Friday, January 21, 2011

Back in the USSR... You Don't Know How Lucky You Are

My relationship with Eastern Europe goes way back to 1994, when I was an exchange student in Slovakia, which had recently separated from the Czech Republic (the so-called "Velvet Revolution"). The country was in the early stages of developing a market economy and a European-style political culture and was widely considered poor and underdeveloped.

Actually, it seemed perfectly fine. People seemed as happy as they can be at this latitude, the culture was a healthy, middle-of-the-road mixture of individualism and collectivism, people could travel freely and engage in many kinds of activities, and one did not sense the presence of a ubiquitous suppressive government machine. Perhaps I was too young to pick up on some adult things like politics and societal structure. I believe there was some suppression of freedom of speech regarding political matters, but I am not aware of any other ways that the Slovaks were not free.

Next stop was Russia in 1996-98. Going there, I knew it would be "Slovakia times 2" relative to my country of birth (USA). That turned out to be exactly the case. Things were more run-down than in Slovakia, people were more helpless and desperate, the economic hardships were greater, there were fewer opportunities and less sense of personal freedom of movement, speech, and opportunity.

At the same time, Russia was an interesting place. I didn't fully realize what this meant at the time, but Russia had just suffered a monumental collapse of society. Production had fallen by 50%, everyone had lost their life savings, and many societal institutions had ceased to function. At the same time, almost everyone was living in their own apartment and had no debt and, essentially, no taxes to pay. Many basic services were provided free by what remained of the state machine.

Few people at the time knew English or were interested in it. I had full Russian language immersion for nearly 2 years. There was little motivation yet to learn English, since it was nearly impossible for most people to leave the country, and the modern corporate juggernaut of Russian pseudocapitalism had barely begun to grow out of the rubble of the collapsed economy.

The Russians were tangibly dissatisfied with life. Their education and profession, once important social assets, now meant almost nothing. The system they had grown up in had ceased to function. One often had to do demeaning things to get by. The American ethos of "making a difference in the world" seemed laughably inadequate when transplanted to Russian soil. You can only "make a difference" by creating a system or transforming a system, which itself can function only by integrating with existing foundational systems of society. People were busy simply trying to get by and make the best of their situation.

Then came Ukraine, which I first visited in 2000. By then the "rambunctious 90s" had basically ended, thugs and mafia had either died off or institutionalized, and a semblance of law and order had returned to most of the former Soviet Union. My young Ukrainian friends were earning under $150 a month except for rare exceptions. People received their salaries in envelopes, and US dollars were the main currency in use for "anything serious."

Ukrainians were tangibly lacking freedom of speech and access to government. People talked of the "regime" and of the difficulties of getting by in the shadow economy. Everyone was outside the law in some way or another. Government was either avoided (by individuals) or bribed (by businesses).

In the 2000s, the economy started to pick up after years of contraction. More and more consumer goods were making their way into the country, and real salaries were rising faster than expenses. People started investing money in real estate (banks were still not trusted), and prices rose by leaps and bounds. Cell phones became popular, dial-up Internet was replaced by cable, flat-screen monitors appeared, and rumors of wireless Internet began to seep in.

The mood of the country had changed perceptibly. A sense of optimism had appeared that had formerly been absent. People sensed that their life was actually improving and that stable economic growth was occurring. They began to plan for the future. Banks accommodated them by offering loans and mortgages, first for just a few years, then eventually up to 10 years. 10 years of predictable economic conditions in Ukraine! -- the thought seemed almost believable for the first time in decades.

In the middle of the 2000s, there was a blip called the Orange Revolution. Widespread economic optimism about the future demanded a more accommodating government with more modern ideals. The new leaders made optimistic statements in the spirit of the time and enjoyed widespread support from a little over half of the population.

Despite the new government's incompetency, basic economic fundamentals pushed the economy forward and contributed to a rising standard of living. I discontinued my internship program because it just seemed too expensive now to come to Ukraine and work without pay at some organization for a period of time. It used to be that one could get by on $400-500 a month, which is not too much for students and young professionals from the West, but now living expenses were pushing $1000 in Kiev and other big cities.

Within just a year or two of the Orange Revolution, the new government was deemed a failure by a vast majority of the population. Legislation and development projects were at a standstill, and campaign rhetoric had not translated into actual deeds and government policies. At the same time, government offices were as corrupt as ever or even worse.

Then came the financial crisis of 2008. Real estate prices fell by half, credit dried up almost overnight, and the Hryvnia lost 40% of its value against other currencies. Construction projects in Kiev were shut down, and large numbers of labor migrants had to leave the city and return home for lack of work. Suddenly, people who had taken out dollar loans were barely making their debt payments, and people began to go bankrupt.

The mirage of economic stability disappeared once more. Even after the semi-recovery of 2010, national debt payments hang over the country's head, and there are persistent rumors of a coming wave of economic difficulties and further declines in real estate prices. The mood is cautiously optimistic to overtly pessimistic.

The new government leaders have proved to be more organized and coordinated in their actions, and infrastructure projects have been boldly resumed, but government decisions are making life harder for people, not easier. Procedures are becoming more difficult to perform, the tax burden is growing, and doing business is becoming more and more difficult, particularly for small and medium-sized business.

But Ukrainians are now better acquainted with the rest of the world. People have been to Egypt, Turkey, Vienna, Poland... Ukraine even got its first low-cost airline. Ukrainian "gastarbeiter" know the ropes in Spain, Portugal, Italy, and Russia. Everyone is either using their English, trying to learn English, or self-flagellating over not being active enough about learning English. Internet use is widespread and ubiquitous for the under-30 crowd (at least in cities).

Awareness about how things could be in Ukraine is growing continuously. The older generation only knows how things are now and how they were in Soviet Union times. The consumer culture has become more and more internationalized and cosmopolitan, while politics is still dominated by people who began their careers in the Soviet Union and continue to gravitate to time-tested authoritarian and Soviet models of governance.

My experience with government bodies of late has convinced me that very little has changed in the operations of the government machine in the past 20 years. Dealing with these offices is like stepping back in time several generations. No one with any power has, as of yet, taken any decisive steps to transform the actual workings of the government machine.

After 15 years of visiting the former USSR, I can say that what is holding Ukrainians back most from a happy life is not a lack of money or economic development, but things like a lack of solidarity and community, a lack of trusting relations with their own government (the phrase even sounds comical), a sense of helplessness due to corruption in the law enforcement and justice systems, the difficulty of legalizing one's activities and residence, etc.

No amount of iPads and personal automobiles can compensate for the underlying sensation of oppression and helplessness permeating Ukrainian society. By working hard and having the right connections one can jump up the corporate ladder, rise above the hardships of the common man, and physically separate oneself from the unpleasant elements of Ukrainian society and the innumerable "tragedies of the commons," but an enduring sense of security is always unattainable.


  1. Very fascinating insider view. Thanks!

  2. Hi Rick, you are starting to sound like a Ukrainian who has lived abroad..

    The people will not become happy overnight for many reasons. I think the big picture is that it is in their national identity, borrowed from the Russians. The Russians think of themselves as "narod-stratadeletz." Now, Ukrainians have been oppressed by the Russians.
    Every history page in the books is covered with examples of the oppressions by the Russians, the Vikings, the Mongols, the Turks, not in that order. It seems the it is the part of the national identity that the people do not even think about much.

    It is not in our blood to be happy, so it seems.
    Happiness in Ukraine is a fleeting moment, but it is that way everywhere. Having lived here for over 13 years - there are few people here, and many of them do not know that.
    I recently read a book of national happiness:

    There are some excellent insights into this enigma of national happiness.

    Overall, I believe that just as people are individuals, so is their moment of happiness. The same goes for countries.

    Keep up the writing, it is good to follow and think about.
    I am from Ukraine but have been away for a while.

  3. Thanks for writing such a great article, Rick! I've spent at least a year in all 3 countries - Slovakia, Ukraine, Russia. Based on my personal experience, I totally agree with your statement that Ukraine has a "lack of solidarity and community". The Slovaks are in general the best as far as that goes. There are also pockets of it in Russia (St.Petersburg comes to mind). I've never seen a trace of national pride in Ukraine.

  4. Purpose In Everything, I think Ukrainians aren't much unhappier than other nations, but it seems to be more acceptable to display unhappiness in public than happiness... It's like people keep their happiness to themselves but put on their unhappy masks in public.

    I know a country where just the opposite is true... :)

  5. This is a very thoughtful assessment of Ukrainian culture (and other cultures relative to it). Almost 2 and a half years after this was written, not much has changed, but I do see glimmers of hope. My wife and I took part in a permaculture course last summer in a Ukrainian village. We lived with a group of like minded, cheerful, optimistic people for two weeks during the course. The atmosphere was so different I felt like we had traveled to a different country. In Lviv we see a lot of young people making a difference. They are being creative, fun, and inspirational. I'm seeing quite a few American style hipsters around. It's refreshing to see people that are "different" from the mainstream.