FACES AND PLACES: "Capitalism" in Ukraine (12/27/92)

FACES AND PLACES

by Myron B. Kuropas

"Capitalism" in Ukraine

For a second year in a row, Ukraine will be celebrating Christmas as a declared independent and sovereign nation-state.

I say "declared" because, thus far, Ukraine is not truly independent and sovereign.

Ukraine still is dependent upon the old nomenklatura, that class of government bureaucrats inherited from Soviet Ukraine who still run the state, not because they are the most competent, but because few people outside the bureaucracy have any management experience. Ukraine will remain dependent until a new breed of government managers, committed to assistance rather than resistance, is in place.

Ukraine still is dependent upon a Parliament dominated by former Communists, many of whom seem to be on the take. One hears horror stories of Ukrainian officials bragging about the amount of money they are salting away in Swiss bank accounts. They're preparing for a future in which they will no longer be in power.

Ukraine still is dependent upon the outside world for economic assistance and political education. The United States remains a model, but that model may not be best for Ukraine today. At a time when Ukraine struggles to develop a strong bourgeoisie, long vilified by Bolshevik cant, the middle class in the United States is disappearing.

Ukraine will remain dependent as long as its economy is dominated by greed, corruption and a social order in which the few become richer and the many become poorer. A moral vacuum exists in Ukraine as the nation moves from a command to a market economy.

Ukraine is not alone. According to an article by Jonathon Luxmoore in The National Catholic Register of December 6: "Three years after the euphoria of 1989, the social mood in Eastern Europe remains deeply troubled. The attempted transformation has brought corruption, apathy, insecurity and confusion. Threats to democracy, stability and the impetus of change appear as dynamic as ever."

These pessimistic remarks were delivered at a November 10 conference on the topic "Business and Moral Standards in Post-Communist Europe." Sponsored by England's Cardinal Basil Hume, the conclave brought together some 150 Church and business representatives including Jacques Attali, president of the European Bank for Reconstruction and Development. What appears to be emerging in Eastern Europe, Mr. Attali emphasized, is the emergence of a "mafia economy" rather than a market economy. Totalitarianism has been broken, he noted, but unless another framework, one "based on clear ethical principles is put into place, there will be no peace in Europe."

Is capitalism the answer? Absolutely. But capitalism with a human face.

In her book "Capitalism: The Unknown Ideal," Ayn Rand argued that democratic capitalism is the only system that protects the sovereignty of the individual. "Capitalism," she wrote, "is a social system based on the recognition of individual rights, including property rights, in which all property is privately owned."

Ms. Rand is right, but her statement is incomplete. It ignores the moral, ethical and religious aspects of capitalism. As Michael Novak points out in "The Spirit of Democratic Capitalism," the economic and political successes of capitalism are based on certain moral structures.

With no moral foundation, Mr. Novak argues, capitalism can spawn hedonism, decadence, economic irresponsibility (the root cause of a U.S. national deficit in the trillions of dollars), an ambitious adversarial class always demanding more from the government, indecency ("free to choose, a democratic people luxuriously manifests vulgarity") and a disenchanted intellectual class that has been displaced by a rising and increasingly crass commercial class.

"When the necessary work of society is so organized as to make the acquisition of wealth the chief criterion of success," a group of Protestant theologians declared in 1937, "it encourages a feverish scramble for money, and a false respect for the victors in the struggle, which is as fatal in its moral consequences as any other form of idolatry."

It is precisely this view of capitalism as unrestrained greed, which the Soviets described in their Marxist treatises for decades, that now appears to be flourishing in Ukraine. Ironically, it is those Ukrainians who have retained some sense of "Marxist" rectitude in Ukraine who still believe having too much wealth is improper, if not immoral.

Given its tendencies towards excess, can capitalism make things better in Ukraine? Yes, but only if more changes take place. Mr. Novak argues that democratic capitalism is not a free enterprise system alone. "It cannot thrive apart from the moral culture that nourishes the virtues and values on which its existence depends." Democratic capitalism, he argues, is "a way of life" based on a moral structure and "a sense of sin," a special evolution of pluralism, and a new and distinctive conception of community, the individual and the family."

The necessity of a moral core in democratic capitalism is emphasized by Richard John Neuhaus in his 1992 book "Doing Well and Doing Good: The Challenge to the Christian Capitalist." Elaborating on Pope John Paul II's 1991 encyclical on democratic capitalism, "Centessimus annus," the Rev. Neuhaus points out that although there is the so-called "preferential option for the poor," when it comes to entering the Kingdom of God, this does not mean, as some liberal Catholic theologians argue, that we must all become poor to go to heaven. The solution lies not in destroying markets but in "widening the circle" so that all people can take part.

To succeed, the Rev. Neuhaus argues, capitalism must be based on certain economic, political and moral ideals circumscribed within a solid juridical framework dedicated to the service of human freedom and based on certain ethical and religious principles.

Ukraine has made many political changes and some economic changes. It is in the ethical arena that problems remain.

As we in the affluent West reflect on Christmas in Ukraine in 1992, let us pray for our people's deliverance from the evils of the past, and the government's acceptance of the new moral order heralded by the birth of Jesus nearly 2,000 years ago.

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