This is an archived USAID document retained on this web site as a matter of public record.
Administrator J. Brian Atwood
"Sustaining the Momentum: Reform at a Crossroads"
Radio Free Europe/Radio Liberty
Prague, Czech Republic
Washington, D.C., 27 May 1997
U.S. Agency for International Development
Thank you for the kind introduction. It
is truly a real privilege to speak to you from the
headquarters of Radio Free Europe/Radio Liberty
in Prague.
These radios were on the front lines in
the battle for freedom in this region and it is
only right that they are now situated in one of
the countries they helped free from communism.
One of USAID's best and brightest, Tom
Dine, our bureau chief for Europe and the New
Independent States, will soon be the new
president of Radio Free Europe/Radio Liberty.
USAID is very sorry to see Tom go, but I am
gratified he will have the opportunity to continue
making such a positive impact in this region.
Less than a year ago, First Lady Hillary
Rodham Clinton and America's most famous
Czech-American, Secretary of State Madeleine
Albright, spoke in this same room. Mrs. Clinton
stressed the rich symbolism of Radio Free
Europe operating in the former Czechoslovak
Parliament. She pointed out that just a few years
ago, when members of the old Soviet-style
parliament filled the room, this was a place
where free speech was a stranger; a place where
ideas were suppressed. Today, we can proudly
say, this is a place where the free exchange of
ideas is flourishing.
Tomorrow, I will be in the Netherlands to celebrate an important hallmark of freedom, the
50th anniversary of the Marshall Plan.
To this day we regret that the Marshall
Plan did not extend to Central and Eastern
Europe. The Foreign Minister of
Czechoslovakia, Jan Masaryk, wanted it to cover
this land but the Soviets refused. Masaryk ended
up a martyr in the cause of freedom, one of
many who stood up to Soviet communism.
Masaryk and people like him were the
inspirations for the cause that these radios --
these voices of freedom -- took up. For so many
years yours was the voice of truth, yours was the
voice that confirmed the correctness of this
region's democratic past. And now you have a
new role. Now you speak to the people of the
region about its democratic future. Now you
speak of membership in NATO, of European
Union, of peace and prosperity.
The Marshall Plan is often called the
most successful foreign policy initiative ever
undertaken by the United States. It laid the
groundwork for the bold, brave steps which had
to be taken to help Western Europe pull itself
out of the tragedy and chaos of World War II.
When the Marshall Plan was first
proposed, there was strong opposition in the
United States. One columnist wrote that
believing U.S. aid would work was "like
believing that the Atlantic could be bailed out
with a soup ladle." Opposition in our Congress
was considerable. Polls indicated that only one
third of Americans supported U.S. participation in a European recovery program. Fortunately,
the skeptics did not prevail. George Marshall,
and others like him, convinced the American
people that peace and stability in Europe were an
investment we could not afford to neglect. And
they were right.
More than 40 years later the nations of
Central and Eastern Europe and the former
Soviet Union face a challenge as difficult as
rebuilding Western Europe after World War II.
Once again, many skeptics in America argue
against U.S. assistance. They say there is little
we can offer. They say that America has
fulfilled its promise with the collapse of the
Berlin Wall. But destroying a wall, destroying a
system of control and oppression is not the same
as building democratic nations.
As in 1947 and 1948, this region's nations
also faced an historic turning point following the
collapse of communism in 1989 and 1990. They
had to make hard choices about whether or not
to liberalize their economies and establish
participatory democracies. Some opted to pursue
reform whole-heartedly. Others were obsessed
with fighting their internal demons.
The forward path of reform is not easy,
and the difficulties along the way can fuel
cynicism. Opponents of reform -- often those
who enjoyed power in the old autocratic systems
-- wanted to push nations back in time, back
toward less freedom, greater state control and
discredited economic schemes. These anti-reformers are still eager to exploit economic,
social and ethnic tensions to hold on to their
power. But the cost of taking the backward path
is high.
The United States and the European
Union must continue to invest in freedom. We
still need radio stations that reach millions who
do not trust their own media. We still need
development programs that create partnerships
for democratic reform. We still need to work
with our friends from this region to create the
policies, the institutions and the attitudes that
will enable market democracies to thrive.
There is much to be done but great
progress has been made. At least two-thirds of
the population of the former Soviet Union and
Central and Eastern Europe now live in countries
where politicians are more accountable to the
people who elected them, where courts -- not
apparatchiks -- mediate civil affairs, where
markets determine prices, and where market-based institutions such as stock exchanges and
small privately owned businesses are contributing
to the development of dynamic economies.
I am proud that the United States has had
the opportunity to work with this region to
achieve these changes. We have not helped by
simply providing resources. We have learned
together that reform and the creation of an
"enabling environment" must precede large
infusions of private and public capital. That
means respect for the rule of law, strong
democratic institutions, open and accountable
capital markets and political stability.
USAID has joined nations in this region
as they have privatized their economies. Well
over 60 percent of gross national product in
Central Europe is now generated by the private
sector, compared to about 15 percent when the
Berlin Wall fell in 1989. That is remarkable in
a region that did not know the concepts of
private property or supply and demand one
decade ago.
Remarkable strides have also been made
in advancing fiscal reform. Throughout the
region, USAID has worked with governments to
adopt more effective budgeting and spending
procedures, reform tax regimes to make them
more conducive to business growth, and to
improve tax administration to raise the revenues
essential for good governance.
In nearly every country in the region, we
have worked to assist enterprises to operate more
competitively, and help reduce government
interference in the marketplace.
We are also helping establish stock
markets and improve commercial banks so that
businesses have access to investment and operating capital and can buy and sell assets.
We provided technical expertise to help establish
the Prague Stock Exchange in 1993, and the
Over the Counter Market in Romania, or
RASDAQ, which opened in 1996. And we
helped create the regulatory institutions -- the
Securities and Exchange Commissions -- that are
essential in combating corrupt practices and
insuring the integrity of trading and financial
systems.
USAID is also helping improve efficiency
in energy production and use, while reversing the
effects of decades of indifference to the
environment. For example, we were a major
partner in the privatization of the Hungarian
power system, which in its first phase has
attracted over one billion dollars of foreign
investment.
The difficult individual and societal
sacrifices required by economic restructuring are
starting to pay off. Economic growth since 1994
throughout much of Central Europe has outpaced
the European Union. Foreign investment
continues to grow, particularly in those nations
which are aggressively combating corruption and
creating the right kind of enabling environment.
In the New Independent States of the
former Soviet Union, significant progress has
been made toward price stability, a precursor to
higher economic growth. Furthermore, the
severe output declines experienced by most NIS
countries since the collapse of the Soviet Union
appear to have bottomed out.
Clearly, remarkable progress has been
made. And obviously, the transition is not over.
Reform has not yet affected the personal
economic well-being of many workers and
families. This will, of course, be the ultimate
indicator of successful reform.
Despite the hardships, continuing down
the reform path is the only viable option.
History has taught us that a market-based economy is the only means of achieving
sustainable economic prosperity. This is a hard
lesson that has been learned and accepted on
every continent.
There is an equally important lesson,
however, that is perhaps less accepted -- bad
politics is bad business.
Healthy, stable societies cannot persist
without participatory democracy. Entrepreneurs
must operate in a free environment. They must
know that growing businesses will not be
undermined by social or political unraveling.
Mutually reinforcing economic and political
reform is the best guarantee of equity, growth,
good governance and democratic pluralism.
The command approach of the communist
system nearly destroyed civic culture. In the era
of communism, people had little awareness of
how they could participate in government to
change their lives and those of their neighbors.
Governments, in turn, did little to encourage
citizen participation.
Today, reformers in new democracies
face the challenge of educating citizens, long
coerced into civic involvement, about the virtues
and benefits of true civic participation.
Voluntary association and active civic
involvement are critical to sustain democracies.
Citizens must organize not just to place new
demands on already beleaguered governments,
but also to build capacity to do more for
themselves and to do more in partnership with
government and the private sector.
A perfect democracy is perhaps an
oxymoron. As Mrs. Clinton said in this room,
"For more than two centuries we Americans have
been striving to perfect democracy, and we will
continue to do so but without any assurance we
will ever fully succeed. Human nature
guarantees that democracy requires constant
nurturing and vigilance."
There is a lot we still have to learn in
America, and there is much Americans can take
from the courageous transitions being made
across Central Europe. However, there is a
universal lesson we all must heed, and that is the
importance of tolerance and respect of fellow
citizens whatever their ethnic background, gender
or religious belief.
Religion teaches us to "love thy neighbor
as thyself." In its purest form, citizenship might
reach that standard, but democracy does not
require you to love your neighbors. It asks you
to respect them. It asks you to preserve their
right to speak out, to associate, to vote, to
participate in the life of your society. Whatever
their religion or their place of origin or their
ethnic background, if a person qualifies for
citizenship in your country, then he or she IS a
citizen -- he or she IS a Pole, a Czech, a
Hungarian, a Romanian, a Russian.
That is not an easy concept to grasp in
this region. Ethnic conflict may be the greatest
threat you face as you seek political stability and
economic growth. The only antidote to this is to
embrace the concept of citizenship. If you do,
you may even come to understand, as we do in
America, that strength comes from diversity.
Strength comes from a society that exploits all of
the talents of its diverse citizens -- all of the
experiences of its different cultures, its different
languages, its different peoples.
Minority rights, and not just majority
rule, are the foundations of democracy. The
region's challenges in this area are immense.
History has taught us that these matters cannot
be ignored. The U.S. applauds the efforts of the
European Union and the Council of Europe to
address these issues, and we will continue to
support the involvement of the Organization for
Security and Cooperation in Europe through its
special representative on national minorities.
Nowhere in the region has there been a
greater display of intolerance for diversity and human rights than in Bosnia. Secretary Albright
and I will be visiting Bosnia in a few days to
witness, firsthand, the worst destruction on this
continent since World War II.
The war in Yugoslavia was fueled by
leaders who spread the rhetoric of hate through
the media to exploit societal divisions. This
exploitation must stop -- and politicians and the
press must contribute to the healing process and
pull communities and people together.
Important first steps towards recovery in
Bosnia are being taken through the
implementation of the Dayton Peace Accords.
Great strides, for example, have been made
establishing joint institutions and a working
presidency.
Formidable challenges remain. The
Balkans must move quickly to establish
economic institutions and adopt significant
structural and economic reforms. Secretary
Albright has said, we will not allow the Dayton
Accords to die. In the coming months, you will
see the alliance pursue peace in Bosnia with
renewed vigor.
We understand that ethnic conflict in one
country in this region affects all countries in this
region and Western Europe as well. Immigration
destabilizes new democracies and it threatens to
resurrect old nationalist movements even in the
stable democracies. So, as NATO and the
European Union expand, we cannot allow
extremists to exploit fear and hatred. We cannot
allow Bosnia to return to civil war.
The importance of Serbia and Croatia in
the political and economic recovery process in
Bosnia likewise cannot be ignored. Alliances
between the governments of Croatia and Serbia
and nationalist leaders in Srpska and parts of
Bosnia are undermining the legitimacy of a
unified Bosnian state. Greater progress in these
areas is vital to the region's short-term prospects
for stability. Creating a security and policy environment in which Dayton's potential can be
realized is essential.
Let me close by thanking the quiet heroes
who through courage and perseverance overcame
totalitarianism, a system of oppression some said
could not be overcome. I refer to the dissidents,
the people who fought communism with printing
presses and leaflets and radio broadcasts, people
some of whom served as prisoners of conscience.
Many of these people came to the West and
many came to Radio Free Europe and Radio
Liberty. We thank you for being the voice of
freedom for millions of your countrymen and
women.
But the dissidents who gained prominence
are the few. Remember the many parents, who
by educating their children at home in the ways
of democracy, ensured that their own heritage of
freedom would not die. These are the many.
These are the people who are building the new
societies of Central-Eastern Europe and the
former Soviet Union. These are the people who
are building the foundations for societies of
tolerance, diversity and citizen participation.
These are the people who never want to go back.
So trust them and honor them as you do the
dissidents. They are the future.
Thank you.
This is an archived USAID document retained on this web site as a matter of public record.
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Last Updated on: July 18, 2001
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