Four Qualities of the Latvian Ruling Class

The image of any state is determined by its ruling class. It is it that shapes the public consciousness through the media that belong to it. It selects and appoints the entire layer of managers and bureaucrats. It organizes and finances parties and slips the electorate those candidates in elections who will do its will. Within this class there are also various rival factions. But they all have one thing in common: the desire to preserve the existing state system. Let’s try to abstract away from distinctions and determine the common qualities which unite that group of persons, which already familiar to us, which rules modern Latvia already almost three decades, pushing, swearing, periodically devouring each other, sometimes temporarily reconciling, jumping from one party in another and sharing positions and property. And let us try not to make a snapshot, but to look at the dynamics of development and to continue existing trends into the future. In doing so, it will be useful to simulate a kind of stress test, that is, to imagine what would happen to us if the more or less calm progression of our society toward an uncertain future made some kind of a zigzagging away from the normal parameters.

So what are the qualities that define the Latvian ruling class?

First, it is bourgeois

This is the basic definition of it. The whole system is built on it. The lion’s share of society’s entire product is appropriated by a small minority at the top. The exploitation of man by man is legalized and morally approved. The capitalist laws, which burst into the economy of Latvia almost thirty years ago, cheerfully and with songs, are still in force and steadily going their way. The social sphere is shrinking, becoming less accessible and more and more paid for. The working conditions of employees are deteriorating. The cost of public services is rising. It is more accurate to say, of course, that the same ruling class, the collective capitalist, whose main goal is profit, is shrinking, making them less affordable, and making them worse. Maximum profit in minimum time. Hidden and official inflation is rapidly eating away at nominally increasing wages and pensions. These trends, long described in detail by the classics, will surely continue. Capital is always striving for self-growth and will stop at nothing, not only because of the proverbial 300% profit, but also when its own existence is threatened.

Stress Test

And such threats do exist. First of all, these are the usual cyclical crises inherent in the capitalist system. We experienced the penultimate one in 2008, and it was very painful, barely recovering even in all indicators. Exactly at the time predicted by the classics of Marxism, another crisis struck. This time it coincided with a global pandemic and Brexit. The safety valve of social tensions, which had been leaking excessive pressure into Europe, was closed. The European subsidies that had been used to fuel Latvia’s chronically deficit budget have been cut. In the case of a prolonged recession of the world economy, Latvia is threatened by a social explosion.

Secondly, it is peripheral, dependent on external players

Latvia’s declared independence turned out to be only formal. In fact, as a member of the EU and the eurozone, Latvia does not have full national sovereignty. Monetary policy is dictated by the European Central Bank. Even the government cannot draw up its own budget without the risk of being fined by the European Commission. It has to fulfill not the will of its own people, but the will of foreign capital. And the government itself is headed today U.S. citizen. Latvia was allowed into the club of the richest countries not to make it happy, but to use it for their own purposes. The position of a poor relative receiving handouts is pleasing to some, humiliating to others, but it is not about feelings, but about the country’s fundamental interests. What, for example, did a Latvian guy forget in Iraq or Afghanistan? He had to take part in their occupation which resulted in hundreds of thousands of deaths and the formation of radical Islamist groups. Why strain relations with your neighbor and largest trading partner? However, Latvia is at the forefront of any anti-Russian campaign. But the greatest evil of this dependence is the country’s economy.

Privatization was carried out largely in the interests of foreign Latvians, “trims” at the expense of the Latvian population that, in particular, has generated an acute social problem of the inhabitants of the denationalized homes. The whole branches of the Latvian industry have been completely or partially destroyed in favor of foreign competitors. The lion’s share of the country’s banks today belongs to foreigners, siphoning off the profits earned by the labor of Latvians. Profits are also withdrawn from other sectors of the Latvian economy. Our largest taxpaying companies are owned by foreigners and their profits flow abroad as well. Only an insignificant number of Latvian businessmen have business abroad. The main financial flows are directed out of the country. The government spends a lot of money on inefficient projects, such as Rail Baltica or the construction of a liquefied gas terminal, which will bring profits to foreigners and losses to the local population.

Stress Test

If the economic situation of foreign partners deteriorates, they will save their business at our expense. The dependence of Latvia’s political elite on external players was clearly demonstrated in the ABLV bank case. The economic interests of the country were not hesitated to be sacrificed at the first wish of American bankers. Approximately the same scenario should be expected in case of a more serious crisis.

Third, it is nationalistic

Although externally Atmoda began with painting over Russian street names on signs, at first they tried not to emphasize nationalism too much. The disenfranchisement of most of the non-Latvian population was covered up by the law on citizenship by blood. Though timid, but at first, the slogan “Latvia is our common home” sounded. But soon it was forgotten. Nationalism went on a slow, but systematic attack. The special position of the titular nationality was already inserted in the constitution. Education in the language that is native to over a third of the population is being systematically destroyed. Openly xenophobic statements by officials are not suppressed, instilling confidence in impunity. Comparing the Russians with lice, calling them genetic deviation, calling to get rid of them – formerly this was the privilege of privileged fringe groups. Today, it is not the last people in the country, including politicians, who talk like this openly. At the same time, a Russian publicist is convicted by Latvian court (https://rus.delfi.lv/news/daily/criminal/sud-prigovoril-politicheskogo-aktivista-aleksandra-gaponenko-k-uslovnomu-sroku.d?id=52766219) under the broadly interpreted article “for incitement of ethnic hatred”. The nationalistically inclined ruling class blocks all attempts to abolish Europe’s infamous institution of non-citizens. The Latvian official media is doing its best to cherish and exacerbate the historical grievances of the Latvian people. Latvian Waffen-SS legionnaires, who served the bloodiest regime of the 20th century and swore an oath to Hitler personally, are officially declared patriots and freedom fighters. A generation of nationalist-educated people is growing up in the country, who have been inculcated with love and respect for SS runes and Sturmgeviers since kindergarten.

Stress Test

In the event of a deterioration of the economic situation in the country and workers’ attempts to stand up for their rights together, the easiest way for the ruling class to split the workers’ movement would be to further foment smoldering national discord, which immediately threatens to develop into Nazism of the most brutal kind. This has already happened in history, including the pre-war history of Latvia.

Fourth, it is inefficient

Even by the standards of neighboring Baltic countries, Latvian national business looks very pale. The Lithuanian trade networks aggressively operate in the country, Latvian companies register in Estonia, if possible, because of the easier tax regime. Not to mention the Scandinavian, German, American, English and other foreign capital, which has bought a significant share of the most profitable sectors of Latvian economy. One of the reasons for this dependence is described above. But there is another one. The Latvian bourgeoisie was shaped not on creation, but mostly on destruction of the Soviet inheritance. During the first years of independence, many enterprises were privatized in favor of the right people, and then either were quickly squandered, or were exploited in a predatory and inept way. Then came the period of redistribution of property between the newly formed oligarchic groups, which feverishly and sometimes drove to bankruptcy of what was still working. In principle, similar processes were going on in one way or another in all post-Soviet republics. But in Latvia, another important factor was added to it. The ruling class had the idea of changing the national composition of the state by pushing out of the country the industrial workers, most of whom were non-Latvians. In order to do this, even those plants and factories, which could work successfully under the new conditions and bring profit to the state, were pushed to close down, giving jobs to the population. As a result, most of those “successful businessmen” found themselves on the top, who were not able to work under the conditions of capitalist competition and whose mentality was aimed not at the development of production, but at the creation of corruptive schemes. Not without reason the most highly paid profession in Latvia today is that of insolvency administrator. Another indicator of inefficiency of the ruling class is the share of civil servants among all employed, which we have above the EU average.

Stress Test

In the event of deteriorating economic conditions, Latvia’s ruling class is likely to be unable to take effective measures to keep the situation under control, to ensure the minimum acceptable performance of government functions.

Thus, the main trends in the development of the existing qualities of the Latvian bourgeoisie lead to a negative scenario. Capitalism develops towards crisis, dependence on external players aggravates this crisis, nationalism develops into Nazism, and general inefficiency of management will not allow to cope with these challenges. Probably, it is time for Latvian oligarchs to study the work of V. I. Lenin “The impending disaster and how to fight it”.