Post communist countries ds - 2020 (1)

PA theories

1. Public Administration in the Central-East Europe and Russia during the Communism and the Transition By Prof. Dr. Maria Bordas National School of Public Service Faculty of Public Governance and International Studies Doctoral School of Public Administration Public Administration Theories and Public Administration Sciences 2020.

2. The reasons for slowing down the modernization process are: Civil Revolutions in Mid-19th Century-Reconstruction C onservation of Feudal Conditions: - Second serf: bondage, robotic system, tax-exempt noble estates - In the absence of capital, no large-scale agricultural enterprise will be established Slow development of goods production: -L ittle effect of the industrial revolution : no c apital accumulation, no large geographical discoveries, inventions, - Expansion of the Turkish Empire in the south

3. Modernization of Central and Eastern Europe German-Roman Empire (abolished in 1806) - Left Rhine: French Influence - The State Economic Order of Capitalism - East: reforms from above by absolutist rulers New states in the early 20th century: - 1918: Hungary, Czechoslovakia, Poland, Yugoslavia, Austria - Fragile democracies: danger of Communist takeover, strengthening of extreme right, Nazi occupation

4. Feudal Absolutist Reforms 1. Habsburg empire: - Maria Theresa: Public Duty, 1767 - Patriarch of the Lord - Jozeph II. : abolition of the serf system, modernization of public administration Austria: - The Civil Revolution of 1848-49: a setback - Austrian Constitution of 1867: - National independence, democratic institutions, political and liberties - Economic modernization

5. Prussia: (from 1525) Reforms in the 17th Century: - Economy: mercantilism, support of manufactories, distribution of land to peasants - Public administration: develop a strong army, public education and transport - State: Absolute monarchy, with the economic and political power of the junker landowner s Feudal Absolutist Reforms 2.

6. Prussia after the Civil Revolutions of 1848-49 - The „ Prussian Way Model ” : Constitutional monarchy (dominance of the junker landowner s ) Economic reforms: modernized large agricultural estate, industrial development, unified customs union, infrastructure, railways Modernization of public administration: Strengthening municipal self-government, rationalization Abolition of the Serf System: Ownership - Compensation with Treasury Bills Public service: expertise Feudal Absolutist Reforms 3.

7. The „ Prussian Way Model ” 1. Eff icienty Prussian state and administration: A utocratic , able to adapt to socio-economic challenges even in a militarized system Chancellor Bismar ck : "The great questions of the age are not decided by speech or majority decisions, but by 'blood and iron.' (1862) - Modernized administration: - Industrial Law: abolition of guilds (1869) - freedom of enterprise - Social security: impact of left-wing movements

8. The Prussian Way Development 2. Militarized state system : General liability for military service Act on Servicemen : supply for the military - Liability of Civilians for military service Military administration : above the civic administarion 1871. – Second German Empire : Protestant party : modernization Prussian Junkers : military- bureaucratic centralization Because of the communist danger they temporarilyput aside their conflicts .

9. Organization and administration of the fascist state 1. Causes of Fascism: - Fragile democracies - Lack of democratic traditions - Communist threat - Economic crisis: poverty, unemployment Solution: concentration of power, centralized state It is based on a far-right party representing a monopoly-knife layer No t : in the old democracies

10. Organization and administration of the fascist state 2. Traditions in the Weimar Republic: - Centralized and militarized state organization - Modern and efficient public administration Weimar Constitution: Civil C o nstitution Possibility of establishing a dictatorship: - President of the Republic: right to d issolution of the Imperial Assembly, emergency ordinances in the form of presidential decrees , right to suspension of the constitution, use of armed force, restriction of freedom of assembly and of the press - Emptying the legislature

11. Fall of the Weimar constitution Economic crisis: reparation, social problems, unemployment 1918 German Communist Party - formation of Soviet republics - Bolshevik influenc 1932 Election: Nazi Party in Minority - Communist and Social Democratic Party Majority 1933 Hitler C h ancellor 1934. President Hindenburg: Full Power for the Government Outcome: public investment - jobs, wage increases, land and tax exemption for peasants - support for the masses

12. State and administrative system of Third Reich 1. Adolf Hitler: Chancellor and leader of the Nazi Party "Imperial Chancellor and Fuhrer of German Nation „ Governance: through emergency orders Member States: Under the control of Deputy Lords subordinate to the Minister for the Interior Parliament: Members of the Nazi Party only Political parties: banned except Nazi party Local authorities: Under the supervision of the supervisory authorities attached to the Minister for the Interior Corporate bodies: economic and labor administration - close monitoring

13. State and administrative system of Third Reich 2. Justice: - Military courts - people's tribunals - static procedure - Extending anti-state crime - Ministry of Justice: may order the courts - Gestapo: i nvestigation , prosecution, review of court judgments - Judgmental aspect: "healthy people's sentiment" - Lack of civil rights: particularly racial and political discrimination Militarized state: SS ( Schutzstaffel ) and Wehrmacht

14. The Russian feudal state Traditions of Byzantine rule: - Isolated from Europe - Conquering wars from the 13th century - No Renaissance, Enlightenment and Reformation - Despotic Power – monolpoly of the Orthodox Christian Church - Byzantine public institutions: the dominant role of the church, despotic gover nance (combining canon law and secular law) Russia: Extreme authoritarianism - the merger of monopoly capital, the feudal landlord and tsarist power

15. The Russian state organization Czar: - Right to make laws and regulations - Management of public administration - with full power - Informer network - Siberian Exile - Police Ministry - Political Police - Imperial Gendarmerie - at local level - Militarized administration: military courts, military coercive measures - There is no constitution or liberal institutions (liberal capitalism is omitted )

16. Peculiarities of Russian state development No Civil Movements (Except: Early 1800s: Dec em brist Movement) Institutions of Capitalism: with Tsarist support, within the framework of feudalism No strong civic class - no representation of liberal values Monopol Capitalist Class : Ally of Tsarist Power People's movements: with anarchic and terrorist means - violently overthrowing the existing social order (Narodnik and anarchist movement) Wage laborers: due to the capitalization of large agricultural estates

17. Reforms of the T sarist S ystem Aim : establishment of capitalist economic relation with maintaining the base of feudal order Means : Support of foreign capital in order to develop economy Contradictory reforms : Local government system : have no autonomous rights – voting rights and positions are based on the asset cesus Iurisdiction : secret police and gendermarie – means of police state General taxation – but not on the basis of burden sharing Abolition of serfdom : dissolve of feudal bonds – large agricultural estate – peasants are not free ( justice of the peace ) – wage-workers - peasants

18. The collapse of the tsarist regime Civil Revolutions: Weak Liberal Citizenship - No Social Base (1917 Provisional Civil Government) Soviets: Bolshevik Party apparatus (United Soviets for Workers' and Military Deputies) Dual power system followed by Bolshevik victory - Bolshevik exclusivity - Menshevik and SRs (Social Revolutioners )

19. The Soviet state and public administration The Soviet government organization: - Congress ( represented by workers, peasants) Central Executive Committee; - Committee People’s Political Commissars: local representatives of the Bolshevik Party - Full Authority Revolutionary Committees: Revolutionary Acquisition s Political Comissar system, Red Army Police: State Security and Armed Forces Unions: Defender of the Bolshevik Party

20. Building the Soviet economic and social order Exclusivity of state ownership – confiscation without compensation - close control of state-owned enterprises Central distribution of wealth - military communism - ticket system - benefits in kind Forced manpower management: work discipline, excessive standards, long working hours, 'sabotage' sanctions, general obligation to work, mobilization of workforce Confiscation of agricultural land - compulsory supply of crops (attic sweeps) Ideology : necessity based on violence

21. Establishing Soviet economic governance - war communism Nationalization: ( confiscation without compensation ) Land ownership, banks, industrial companies, transport p roduction assets can be owned only by the state Economic naturalization: Bypass commodity and money markets Black market, bartering With state compulsion: Ideology: Necessity (Communism is superior – Economic development in a short time ) – Buharin : violence is allowed Violence: peasant riots, 'sabotage' actions, class hostility to labor camps (Gulag)

22. NEP New Economic Policy (Novaja Ekonomicseszkaja Polityika ) Military communism is in crisis: the economy is at its bottom, famine, disconten t 1920s - NEP: ( elaborated by Lenin) - Financial interests of business bodies - Introduction of market elements - Agriculture: crop tax, later kolkhoz - Industry: Small businesses in commerce and craft - State-owned companies: self-accounting ( hozraszcsot ) and contracting

23. The direct plan - instruction system Its purpose: efficiency by creating economic interest Tool : Plan Mechanism (Incentive Scheme) - Economic Plan (State Plan Committee) - annual, medium and long term Plan Instruction: Ministries and Executive Committee directives for state-owned companies Content: range of goods, quantity, number of employees, wages, prices State-owned company: paying taxes, investing the rest in investment - strict financial regulation

24. Low efficiency of the Soviet economic model 1. János KORNAI’s book : „ The Shortage ” The communism wanted to shape the market into its own image: ignoring the law of the market - Demand control: demand was adapted to the production of goods - „ Shortage " means queuing, authority distribution, low consumption - Forced industrialization: did not serve development of economy - service sector was underdevelo ped - Market bargaining mechanisms: profit is based on subsidy vs . withdrawal in the state-owned enterprisen (political factor . Subject to political relationships of the director )

25. Low efficiency of the Soviet economic model 2. Soft budget constraint: the system does not encourage efficient operation (does not lead to loss and bankruptcy) “Gateway unemployment” : to have job is a constitutional right (full employment) and duty (criminalized) - low efficiency "Who does not work, do es not eat„ : capital is forbidden, no exploitation, equality Price and wage regulation: was adjusted to the preference of the Bolshevik Party , e.g . foods are cheap , car is expensive - Puritan lifestyle – li ving on is guaranteed by the Communist state

26. The crisis of the Soviet model 1980s: - Low economic performance - Low living standards - Wages and salaries pensions are devalued - Shortage of goods, low level choice for the customers , queuing - Low level public services and social health care

27. " Glasnost " and " perestroika " Gorbachev: Openness and Reforms - Social Debat e People's opinion: the communist system is unviable - it has no mass support Modernization attempt: 70 years later failed He could not make compromise with the market economy or democratic institutions - contrary to the ideology of communism The backwardness of the communist system vis-à-vis the West is increasingly evident

28. Reasons for the low efficiency of the Soviet model Turning off market mechanisms: low economic performance - no increase of individual welfare - a futile sacrifice Dismantling Democracy: Bolshevik Party Defines Public Interest and Political Decisions – Political Power for its Sake Low state efficiency: It questions the belief in a higher order of communis m Goal does not justify the means : mission consciousness – state system based on Bolshevik ideology and violence should be failed Personal cult: Increases dictatorship within Bolshevik Party - concept and showcase lawsuits by Stalin to eliminate his enemies in the Party

29. The Soviet government organization 1. Democratic institutions exist formally, but in reality, dictatorship: "All power belongs to the working people„ - promise : people's sovereignty, equal rights, prosperity (workers - peasantry) - No political pluralism: only the Bolshevik Party - Election s : general and equal, but only for Bolshevik candidates was allowed to vote - Government posts: based on political loyalty - There is no real separation of powers: the Bolshevik party dominates the state organization – form of government : "state party"

30. The Soviet government organization 2. Centralization: the only amim is to implement the central political will (excluding local autonomy) People's Commissars: oversee implementation Councils : under dual direction – by second level council and executive committee Justice: under political influence Trade unions: executives of Bolshevik decisions Use of Terror: If the instruction is not executed or criticisms are made

31. The Soviet model in Central and Eastern Europe after WW II Local Communist Parties : Got political power with violence v. unfair political games Scenario : Communist parties under Bolshevik leadership - People's front elections - Left parties can start – Disqualify them after taking office - Intimidate voters - Falsify elections - Hungary : 1945: FGKP Absolute Majority - Forced Rape of MKP Coalition - Acquisition of Ministry of Interior and Law Enforcement by the Bolshevik Party - Merger of SZDP Peasant Party – Squeezing out the FGKP (Show trials , Defamation , Intimidation , Political Murder ) 1947: " Blue Label Elections „ ( falsified by the Bolshevik Party ): MKP ( Hungarian Communist Party ) wins

32. Communist takeover 1. S teps : Economy: - Nationali zation ( confiscation without compensation ) in industry and agriculture - Forced industrialization - Collectivisation of agriculture ( land confiscation from the owners and establishment of a state-owned large enterprise ) - High rate of state investment Constitution: Communist Party Leadership, Worker Power, Collective Property, Trade Unions, Close Relations with the Soviet Union

33. Communist takeover (2) Reckoning with class enemies: old ruling class (landlord aristocracy, capitalists, churches, civic parties, small-holder peasants) arrests, imprisonments, deportations, internment, exciles – using the political police to it Criminal Sanctioning: Offenses Against the State and Collective Property Protection – declared asserious crimes Show trial : against own members - public form: "s hopwindow trials „ Cult of personality : leader of the Communist Party should be admired by the people

34. Reform of the Stalinist system , after the Death of Stalin More liberal politics - national special path policy - debate, criticism Socialist legality: abolishing police-state method s KGST: economic support to Member States Dissatisfaction movements: low standards of living and lack of political and libert y rights Economic reforms: unsuccessful - wage increases, welfare benefits

35. The Hungarian model - attempts at reform Imre Nagy: Political-economic reforms - Legality: Review of show trials , amnesty, abolition of internment camps, crackdown on political police - Economic reforms: state subsidies, moderate taxes, price cuts, wage increases, rehabilitation of kulaks ( small landowners ) - Political reforms: Opportunities for debate with the opposition, more liberal political life - Re construction : Mátyás Rákosi – reaction of people : 1956 Revolution against communism

36. Attempts at economic reform in Hungary 1. Economic reform of 1968 : estableshed the "indirect plan directive model ” Economic autonomy of state-owned enterprises : it is more efficient if can achieve own economic decisions and to make profit Economic Regulatory System: Instead of Direct Plan Directives - Incentive, in legal form , but with economic content (financial regulation, labor management, price and wage regulation) Central administration: fewer ministries, functional (Ministry of Finance, Price and Wage Office, Planning Office Ministry of Labor) - sectoral (industry, agriculture, foreign and domestic trade, etc.)

37. Attempts at economic reform in Hungary 2. 1984 organizational and legal reform: Organizational and legal guarantees for economic autonomy of state-owned enterprises Self-governing bodies: Employees of the state – owned enterprises are elected as members - Exercise of all property rights Supervision from Legality : Public Administrations Can Only Investigate L awfull Operations, but Not Decide on the Economic Issues of the state-owned enterprises „ S econd Economy ” : A competitive market on the periphery of the economy Small business companies - I nstitutions of market economy: competition law, company law

38. Impact of economic reforms in Hungary "Goulash Communism" - "The Happy est Barrack" - The standard of living of the population has increased: car, apartment, weekend house, higher consumption - It has become possible to run small businesses - State housing construction - a symbol of value - Low food prices, utility tariffs - Full employment Paternalist tradition: population expects the state to provide increased care - "Pre mature welfare state" ( Kornai ): unable to meet welfare and social expectations , neither the promise of the communist state

39. Anomalies of social and economic reforms in Hungary The Dilemma of Economic Reforms: Ownership by the State - Ownership Rights excercised by self-governing bodies of the State-Owned Enterprises – Not in the form of business enterprises (no company law ) R esults : - Lower efficiency than expected - The self-governing body of a state-owned enterprise does not behave like an owner – follow employee interests Environment: Centralized and bureaucratic economic governance - Limited market mechanisms - State control Impact of social reforms: (Kádár system) - Tradition: bargaining with political power - accepting political leadership in return a higher living standard - no political pluralism

40. The period of the Hungarian transition 1990: Which model is the "round table negotiations " - institutions of liberal democracy – which modell to follow ? Contradictory modernization: (failure of reforms) Extreme confrontation between the two political sides ( right wing and socialist liberal wing ) - lack of consensus - other ideas of market economy, state intervention, state ownership, privatization, welfare institutions „ Paraseline ” (business companies close to political parties ) : Role : Financing Elections , Building Media Empire from financial resources of the state budget – high level state corruption The „ spoil system " in public administration: importance of political loyalty, not expertise – who serves public interest?

41. „ Majority democracy ” 1. I deology : - Political will is disintegrated by political divide of the two political sides – unmanageability Criticism of the left - wings : the successor of the Communist Party, having excessive economic power, neoliberal, supportive of globalization - it supports the downtrodden, does not represent the middle class, not the interests of the national economy, etc.

42. „ Majority democracy ” 2. „ Central Field of Power” : - People's sovereignty: broad authority - 2/3 majority in P arliament - Legitimacy for the formulation of the public interest: national economic and social policies - Central political will can be executed quickly and unhindered - limiting control ling bodies (especially AB) - strong state intervention in the economy - Centralization of public administration: restriction of local government autonomy Price: eradication of liberal democracy

43. Centralization of public administration 1. Issues of the organization of public administration : - Administrative tasks: at what level - Administrative body: independent or subordinate - Nature of the administrative task: authority, service provider, organizer 1990. municipal system: low efficiency - Decentralized, with strong autonomy - Fragmented: the county is weak - the powers of the municipalities are wide

44. Centralization of public administration 2. R eforms : - Association of municipalities: voluntary - Regions: Non-genuine Local Government ( Questions of Having Development Resources) 2010: Restriction of municipal rights (was a constitutional fundamental right unit that time ) - Government Offices: Decentralized administrative bodies - District Offices: Non-local authority tasks - under the direction of a government delegate - "Nationalization" of local public service tasks (public education and health)

45. Economic constitutionality 1990: Constitutional Court - wide review right - "invisible constitution" - actio popularis 2010 : Reducing the powers of the Contstiutional Court : - Reduction of ex-ante and ex-post control of norms - Appointment based on political loyalty - Opposition divided (no parliamentary majority to query the decisions of the CC) Reason: Unhindered implementation of government economic policy Result : Lack of constitutionality and state under the rule of law ( lack of public policy approach, stability, predictability, accountability, quality legislation)

46. Building institutions of the market economy - privatization 1990 Constitution: Market Competition and Freedom of Entrepreneurship (Competition Law, Price Law, Company Law, Employment Law, Social Law, Social Security Law) 1989. Privatization - Spontaneous Privatization – at the end of 1980-s by the communists - "Political Privatization" ÁVÜ by the first democratic government since 1990-s - "Privatization of Privatization„ by the left wing-liberal government since 1995 - Privatization of infrastructure sector (concession) since 1995

47. Privatization Objective: Establishing market economy institutions in the short term, at all costs Results : corruption and drastic decrease of the state assets , i.e. waste , law efficiency Intense political debate: - The state is necessarily a bad host ( liberal conception ) - State ownership is a tool of economic governance ( right wing conception )

48. Privatization of public infrastructure services 1994 : sale of gas and energy sector Concession: telecommunications, highway, water service, local and long distance road transport Price Control Anomalies: - Ineffective price regulation system - Energy prices are the subject of political struggle 2000 : Liberalization - Price doesn't matter 2010 : "Utility Cuts" - Forcing Businesses Out of the Market (Price Rise, Re-bidding Monopolies) Result: Political profit but low efficiency

49. State subventions 1. State subventions: low efficiency European Union: if a market anomaly needs to be resolved - Left wing : supports multinational companies - Right wing : Hungarian small and medium-sized enterprises ( Széchényi plan) – since 2010 German nultinational enterprise in return of political support in the UE by German politicians Agriculture: (of EU importance) - Compensation of the former owners : non-competitive small estates - Poor market structure: monopoly position of purchasers - Concentration of the land : pocket contracts for the foreigners , since 2010 for the domestic enterpreneurs loyal to the government

50. State subventions 2. 2010. agriculture Rural development strategy: - Tendering for State Land - Farmer Landing (Corruption : those are selected who are loyal to the government ) - Re-regulation of the agricultural market: protection of interests, price regulation, state aids, mandatory content of contracts - Agricultural Market Order : regulation of agricultural production conditions in its own sphere, risk management funds, elimination of "pocket contracts"

51. State monopolies Since 1990: gradually decreased 2010: Number increased (unusual in market economies) Reason : Acquire new markets for your own paraseline close to the government Instrument: Establishment of state-owned enterprises and creation a favorable market position for them ( by s tate aid and by public procurement) Public Procurement: (Party State Traditions) - Objective: Provatizing public tasks (contract ing out , PPP) - In fact: the conversion of public funds into private property and the financing of parties – establishing an own capitalist class for the govrening party in order to compensate the advantages of the let wings .

52. Rationalization and efficiency of public administration E xperiments : - Organizational reforms: no two-thirds majority to it , but from 2010 centralization - Legislation: There is no tradition of quality legislation - impact assessments, public policy approach, evaluation of implementation - Reducing Administrative Burdens - Deregulation: Legally over-regulated public administration - Controlling bodies: State Audit Office : no legal consequences, government audit bodies : not independent from the government

53. Attempts to reform the welfare and health systems 1. Two aspects : - Solidarity - Efficiency in the use of public funds Traditions : - Excessive expectations - Gray economy - Avoid paying taxes - Widespread and subjective welfare services

54. Since 1990: loss on the state budget – state debt - grey economy , unemployment , declining class R eforms : - „ Bokros Package ” (1995): Reducing Welfare Services – Constitutional Court Review Economic Stabilization : ( harsh conflict on the economic policy between the two sides ) - Filter out "free-riders" - Establishing an autonomous social security fund - 2010: Work-based society: Public work, drastic cuts in social benefits - Pension system: anomalies of pay-as-you-go system – nationalization of private pension funds Attempts to reform the welfare and health systems 2.

55. Attempts to reform the welfare and health systems 3. H ealth : Failed reform attempts (lack of consensus) several conceptions : - Adequate level of care - Guided patient care - Liberalization of the insurance market - Co-payment practice - Privatization: "blackmailing" and corruption 2010 : Nationalization Financing: dual and inefficient Pharmaceutical market : s tate aid - p ublic health care – requires h igh budget expenditure - 2010: Cutting subsidies and redistributing the market by pharmacies

56. Economic policy 1. Since 1990: budget deficit - government debt (gray economy - unemployment - lagging behind - low efficiency – high state corrupt ion ) 1995: Bokros package - cuts in social spending Intense opposites: neoliberal vs. fiscal instruments : - Curbing the population - Tear layer support - Developments: support for investments, domestic businesses, housing construction - Family allowances, minimum wage

57. Economic policy 2. 2010 . 'unorthodox economic policy’ - Powerful state intervention Objective : against globalization, interests of national economy, welfare of population Instrument : Increasing state ownership and monopolies, strong financial market regulation, special taxes on multinational companies, boosting employment, supporting small and medium-sized enterprises, more favourable middle-class taxation, reducing social backing

58. U northodox economic policy 1. Nationalization: Putting the Lunar Court in a favorable position - crowding out business Government acquisitions - price regulation - making losses Re-tender - Establishment of state-owned enterprises Welfare Measures: Forced Labor, Poverty Increase, Utility Reduction, No Health Reform

59. U northodox economic policy 2. Taxation of Multinational Enterprises: - Putting the l oss for the consumers - price regulation - mass layoffs - regulation: wage supplement Middle class: more favorable taxes but no increase in consumption Investments: Decrease in business investment - prestige investments Improvements: for own paraseline – extremely high state c orruption

60. U northodox economic policy 3. Results: - Widespread Support: Emphasizes Welfare Principles and National Economic Interests - Anti-Neoliberalism Economic Stabilization: Low Budget Deficit and Low Economic Growth (EU Resources) Employment: wide public work - apparent growth – controversial Rearrangement of economic positions: conscious - to compensate for the economic dominance of the left wing party Eliminating the state under the rule of law: controversy over whether you have a more efficient system - controversial

61. ANY QUESTIONS?