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Czech Republic: Quo Vadis

Michael Werbowski, October 31, 2008

Outdoor cafe on the Old Town Square, towers of the Tyn Church in the background. (Photo: Murat Taner / Getty Images)

Czechs celebrated the 90th anniversary of the foundation of the erstwhile Czechoslovak republic on Tuesday. Huge flags adorned the public buildings (rivaling for space with the commercial banners advertising cars, mobile phones and mineral water now blanketing historical monuments) and police stood watch vigilantly looking for potential trouble makers. A prominent monument and memorial honoring the Czech fallen fighters from the "great war" in Prague was closely monitored to ward off right wing extremists seeking to cause unrest on the occasion, especially, ahead of the Czech President's Vaclav Klaus visit to the site, on this solemn occasion. In the Czech capital, a huge military parade not seen since the bad old days of the communist regime (in 25 years) took place. For some Czechs watching the scene on the nightly news broadcast, this display of military might almost appeared like a flashback to the days of the Warsaw pact's glorification of the armed forces when Czechoslovakia was then a pact member. Now Czech Republic along with the rest of "new" Europe is a loyal (some say pliant and perhaps even supine) member of NATO.

Armored personnel carriers, tanks and rescue vehicles, even Czech contingents perhaps heading for Afghanistan were all part of the patriotic procession. The young Czech republic is now only 15 years old, since its creation in 1993, after the hastily arranged (by means of back room bargaining) Czech Slovak split. Despite its neophyte status it seeks to reassert itself on the international stage. The country prepares to assume to the EU presidency (to the great dismay and disapproval of Paris) in the new year. This will be a big chance to do just that. The decades long post communist normalization process of political and economic transformations is finally over. The country has moved beyond the post communist era. But now the young and restless republic is facing great uncertainty. Where it is headed now is unsure. There is an air of uncertainty and a sense of drift in the Czech lands. In the pubs and coffee houses of Prague, locals gripe (a national sport they tell me) about rising prices, housing shortages, the influx of foreigners (racial tensions with ethnic communities such as the Roms are rife. The unrelenting pace of privatization, deregulation and other neo liberal reforms have led to great prosperity for some but has also left behind other – as evident by the growing numbers of homeless. Old ladies, even on the day celebrating the birth of the republic, rummage through rubbish bins looking for scraps of food or discarded wares in the city streets.

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Life looks especially hard for pensioners who receive between 7,000 and 10,000 Czech crowns (approx. $500 USD) state pension per month. They above all fear the arrival of the Euro common currency in the region. A recent poll conducted in the country showed the elderly and retired most reluctant to live to see the day when their country joins the "Eurozone." The Euro is already on the Czechs' doorstep. It's neighboring states – Germany, Austria – already use it and Poland has announced an official date – 2012 – to join as well. For its part, Slovakia frantically prepares to enter into the Eurozone on the same day the Czech republic assumes the presidency of the EU – January 1, 2009. The Czech republic has, according to Brussels, all the qualifications to join the EURO, and like its neighbor Slovakia, has met almost all the Maastricht criteria for membership. The two formerly united republics are fiercely competing for Foreign Direct Investment as it dries up in the midst of the global credit crunch. And being in the Eurozone, for Czech entrepreneurs, is a stabilizing factor for the country amid the current market turmoil, as well as lure for more investment. Yet the pleas of small enterprises to adopt the Euro as early as possible has fallen on deaf ears at both the Czech National Bank and the Finance Ministry. It appears as if the countries' politicians fear that growing "reform fatigue" is setting in. And another economic shock to the system, like abandoning a strong (almost overvalued) Czech crown for the EURO, might be too much to bear for the average Czech citizen.

The Czech lands: A playground for rich felons and a faithful US ally

Crime and corruption are rampant. And the domestic political scene looks a bit like bedlam. The current ODS (civic democrats) headed by the Prime Minister Mirek Topolanek are riven with internal party dissent. Pavel Bem, the current mayor of Prague after the humiliating defeat of ODS candidates in the senate, is a potential successor to ODS leadership now headed by the PM Topolanek. A "night of the long knives," whereby a leadership struggle to determine the outcome of who will lead the ODS in the next general elections, looks imminent in the wake of the ODS party's rebuke in the recent local and senatorial elections.

Despite the domestic political mess, the country is now a member of all western organizations and institutions. It is firmly anchored in the western camp. Not surprisingly, Prague is an extremely staunch U.S ally. The country, despite widespread opposition among the populace to the installation of a U.S made radar on its soil, seeks to ratify the treaty in parliament which would give some much needed democratic legitimacy to the Pentagon run radar project. The whole deal may be delayed however, due to last week's regional and senate elections, where the ruling ODS party suffered a drubbing, and the Czech social democrats opposed to the radar won several seats. Nevertheless, Michael Chertoff, the U.S Homeland Security boss, flew into Prague despite the thick fog, on the festive day, to announce visa free travel for Czechs as a carrot enticement for accepting the "third site" - of the U.S missile defense scheme on Czech territory. The question remains though, will Czechs rush to live and work in the U.S as it faces its biggest economic crisis since the great crash of 1929? And is riling the Russians with a radar site worth unsettling the siltation on NATO's eastern front for the Czechs?

Finally, for some EU states, Prague, especially France and Germany, is far too cozy with the Bush administration. But the current banks rescues and EU action plan, drafted by the "new avengers" Gordon Brown and Nicolas Sarkozy to avert the financial crisis spreading east, by injecting billions of Euros from Brussels into central European (and Czech) banks, might make Prague more amiable to their richer EU cousins in the future.

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