Still Trying to Fool the West

After the tough talking to President Kuchma got in Washington, an old truism has been demonstrated yet again: the former nomenklatura running this country will promise anything, like fighting corruption and starting serious reform, in order to get money but has absolutely no desire to do either. Take the land “reform” announced on December 3. There will now be “private property in land,” which can be bought from collective farms to be “reconstituted” on the basis of “private property,” which, however, cannot be either resold or mortgaged. This means anyone so intrepid as to try to start a private family farm will have no collateral to use in order to take out a loan for startup capital. The collective farm, which is to be “abolished,” is really just going to be relabeled as the collective farmers become collective “owners” of entities that will continue to work as they always have, running up debts without the slightest danger of foreclosure or bankruptcy for years on end. One really could not have expected much more, because nobody in power is seriously thinking of taking on the barons who run Ukrainian village life, collective farm heads. Real agricultural reform would mean doing just that, and it is simply not going to happen.

Under current circumstances, the authorities here could not do more than pretend to fight corruption even if they wanted to. I hate to repeat myself, but if those in a position to engage in sleaze do not get paid enough, virtually everybody will do it, and even the toughest laws against it will be openly flouted. The only way to even begin to fight corruption is to create a situation such that officials are at least not forced to be corrupt, and this can be done only if such people are paid decently and on time. This in turn cannot be done unless the structure and functions of the state are reduced to the point where the need for resources to support it are not so great as to either strangle economic activity or push it into the shadows but actually encourage it. After all, a massive shadow economy is only a response to the fact that the pressure of taxes and regulation render legal economic activity impossible. Reform means downsizing the state itself to the point where the economy can pay for it and engage in legitimate business. Anything else is just window dressing.