Tuesday, May 17, 2016

Migration, Not Labor Markets, is the Issue of the Current Era

By Václav Klaus
Thank you for inviting me to attend this conference and for giving me a chance to speak here. I am most honored by it. I was here, in the International Institute for Applied Systems Analysis, only once before – it was four years ago, in January 2012. I spoke at the conference entitled “Economies in Transition – 20 Years After” which was devoted to the debate about economic transformation in countries of Central and Eastern Europe and in ex-Soviet Union countries in the era after the fall of communism.[1] It is still a relevant issue.
Today´s topic “Labor Market and Migration across the Eurasian Continent” is different. Straight at the beginning, I feel obliged to make two comments as regards the title of the conference:
- the mass migration we experience here in Europe now is – strictly speaking – not a Eurasian phenomenon. This migration wave goes from the Middle East and North Africa into Europe. There are no migrants coming from Central and Eastern (or Southeastern) Asia. At least until now;
- the current migration is in my understanding not connected with the labor market.The migrants we see in Europe these days do not come here as a labor force.These two phenomena shouldn´t be, therefore, put together. It is a wishful thinking of some European politicians (and their fellow-travelers in the media and academy) to see it that way.
In a recent book of mine (written together with my long-term colleague Jiří Weigl),[2] we – among many other things – reject the views repeatedly presented by irresponsible, migrants welcoming European politicians who claim that migration can help to solve European labor-force shortages, as well as a the low birth rate in Europe.
I am not aware of such shortages, I don´t see them. I am aware of the rigidities of European labor markets. We all know that there are 23 millions unemployed in Europe (the unemployment rate is more than 10 % in the Eurozone countries, as compared to only 4.5 % in the Czech Republic). Any reasonably thinking person must admit that in absolute terms, the available labor force reservoir in Europe is sufficient. The incoming migrants cannot be expected to solve the remaining structural problems which are caused by labor market inflexibility, not by labor shortage.
The same is true about the European “demographic problem”, about the low birth rate and the aging of the European population.
These phenomena, however unpleasant, are not caused by “demography”. They are caused by ideologies attacking the traditional Christian concept of the family and of the natural differences between men and women, by ideologies struggling for the emancipation of women and fighting for gender equality. This is the current European problem. Demographic developments should remain a natural evolutionary process. They cannot and should not be changed by government policies, especially not by irresponsible organizing and encouragement of mass migration. As I said, Europe does not suffer from a lack of people. All past generations living in Europe were much less numerous than the present one. Europe is and will remain the world´s most densely populated continent, there is no empty space waiting for settlement there. The economic consequence of a low birth rate (perhaps even of population decline) will be an increase in the price of labor and a change in the capital-labor ratio. Higher labor costs will encourage technology substitution and innovation. It requires, however, free markets and easy movement of people, resources, capital and ideas.
The massive stream of migrants from the Middle East, Western Asia and Northern Africa into Europe, and especially into Germany, which had started in 2015, continued even in the first “cold” months of 2016. What we are experiencing nowadays is Europe's most serious crisis since World War II. Migration brings about not only rapid changes in the ethnic composition of countries the migrants travel to. It creates substantial cultural, social and political conflicts, shocks and tensions. It undermines the – for centuries and millennia gradually developed – habits, customs, behavioural patterns, ways of life. It leads to chaos in the otherwise bureaucratically (and boringly) run dealings of the European Union institutions, and it creates hitherto unfamiliar uncertainties and confusions in the individual EU member states.
Migration has, however, different repercussions in different parts of Europe. I will speak here today from the perspective of countries in my part of Europe which means east of Germany. It is not only geography. The current mass migration affects Central and Eastern Europe in a development phase that is very different from the western part of the continent. Great Britain as well as countries of Southern and partly also Western Europe are, therefore, not experiencing the current migration shock as intensively as Central and Eastern Europe and the Balkans. They had been the target of strong flows of migrants from its former overseas colonies in the past. They are to some respect used to a steady influx of people of different cultures, religions and colour of skin. Even there, however, the difficulty if not impossibility of assimilation of migrants coming in increasingly large numbers has become a first rate political and social problem.
The current migration wave is strengthened by the very fact that EU borders have been open and remain open even after all what happened last year. The inability, lack of will or even an intentional behaviour of key European politicians to protect those borders serves as a strong motivation for migration to continue. The European politicians – used to operate in post-democratic EU institutions – probably still believe in the half-baked and ill-conceived utopian idea of Schengen which has – as we see it – proved to be fundamentally wrong and untenable. Borderless society can´t exist.
The migration crisis created a deep rift between the official position of countries of Western Europe, headed by Germany, which are supporting migration, and the position of smaller states of Central and Eastern Europe, as well as the Balkans, which reject the idea of artificial settling of migrants on their territory, based on the decisions of European superpowers. We should insist that this is not a conflict between humanism and xenophobia, or between solidarity and egoism, as argued by some European politicians and media. The large group of nations situated between Germany and Russia has a long-standing tragic history of fighting to protect their national identity and state sovereignty, as well as a rather sad history of struggle against attempts by large neighbours to conquer their territory and change its ethnic structure.
This region also remembers the history of hundreds of years of fighting against the violent expansion of Islam into Europe. Wars against the Turks had been part of history in Central and Eastern Europe (and the Balkans) for centuries. The current plans for quite illogical settling of Muslims in Europe, masterminded by Brussels, seem totally absurd in this context. They can be justified or defended only by the failed doctrine of multiculturalism. I suppose we all know that it is a blind alley, a wrong way, via mala. For countries to function, they need a minimum (which is not low) degree of homogeneity and unity, not a maximum of heterogeneity (and diversity). The ideology of multiculturalism tries to deny this.
It is also important to note that the 20th century – with Nazism and Communism – was the time of another fatal existential threat to countries of Central and Eastern Europe, resulting in millions of innocent victims. This region was much more severely affected by these totalitarian regimes than Western Europe.
It should not be, therefore, forgotten that the people of Central and Eastern Europe have a long and tragic history of social experiments, similar in nature to the current migration project, including unauthentic solidarity forced from the outside, calls for self-sacrifice in the name of the future, and attempts to create a new species, a new, truly European, man. What is happening today is not far from such failed ambitions.
The small nations of Central and Eastern Europe have won their freedom only recently – after the collapse of Communism. They believed that membership in the EU would safeguard their future existence. This is not how they see it now. Suddenly, their fate is being decided by Germany and some other West European countries, regardless of their own will and opinion. Again, there are talks where – just like in Munich 78 years ago – the big countries decide who should live on the territories of other countries. The slogan – which is a part of our elementary school education – "about us without us" has come alive again.
We should know that the current migration wave is not primarily caused by the failure of countries of the Middle East and Northern Africa. Its apparent unstoppability is a by-product of the already long existing European crisis, of the systemic defects of European policies, of the built-in defects of EU institutional arrangements, of the weakness of European political elites, and of the absurdity of their ideology as well as practical policies. The current policy of Germany and of the Brussels establishment proves to be a bigger threat to the future of Europe than the migrants themselves.
My criticism is not aimed at the migrants. It is aimed at the present day Europe, embodied in its temporary organizational form, in the EU. The very causes of the current migration crisis can be found and fixed only in Europe. I very much hope that conferences like this one can come up with the much needed arguments and thus contribute to a more rational and reasonable behavior of European politicians.
[1] Klaus, V., The Political Economy of Introducing Free Markets, IIASA, Vienna, January 14, 2012, http://www.klaus.cz/clanky/3022.
[2] Klaus, V., Weigl, J., Europe All Inclusive, A Brief Guide to Understanding the Current Migration Crisis, Olympia, Prague, December 2015, in Czech (German, English and French translations are under preparation
Václav Klaus is a Czech economist and politician who served as the second President of the Czech Republic from 2003 to 2013.
The above speech was delivered at the conference “Labor Market and Migration across the Eurasian Continent”, IIASA, Laxenburg, Austria, April 13, 2016

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