Eye on Europe 14 by Paul Healy

EYE ON EUROPE STOCKHOLM NETWORK THE LEADING PAN-EUROPEAN THINK TANK AND MARKET-ORIENTED NETWORK ISSUE FOURTEEN

WINTER 2007

IS RUSSIA RUNNING OUT OF GAS? Listening to Western media reports over the last few months, one could be forgiven for thinking that we are witnessing the birth of a new Cold War. Expectations that after the isolation, belligerence, and economic failure of the Communist years, Russia would ‘return to Europe’ like a prodigal son have been seemingly shattered by recent developments. Much has been made of Russia’s slip back into authoritarianism, its use of energy as a political tool, its increasingly ‘difficult’ stand on international affairs, whether over the status of Kosovo or the placing of US missiles in European countries, and its emphasis on beefing up its military capacity.The conclusion drawn from these developments has been that Russia poses a threat to Europe. However, this simplistic assessment of Russia’s relationship with Europe misses out its most fundamental truth – Europe and Russia are interdependent. What is more, as things stand Russia is the more dependent of the two parties. Unless it realigns its political ambitions with economic reality it risks moving in a retrograde direction. CONTINUED ON PAGE 2

Russia’s Near Abroad

IN THIS ISSUE: Alan Greenspan

Less state, more wealth: the evidence from Slovakia

The Lisbon Strategy – a perpetual start

Spotlight on the Health and Welfare Programme

Eastern European Think Tank Profiles

P8 –11

Europe has nothing to fear from Polish plumbers

P12

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When the East European countries in various ways threw off the Communist regimes, their immediate aim as far as foreign policy was concerned was to “rejoin Europe”. In actual fact, this did not mean an immediate desire to be part of the European Union. What they wanted was membership of NATO and some kind of a free-trading agreement with west European countries, their greatest fear being that the Soviet Union or, after its collapse, Russia might think of reinvading. As things stand, that is an unlikely scenario. Russia may still be one of the largest arms producers in the world but that is largely to bring badly needed income into the country.The military forces are in something of a mess: still a call-up army, it nevertheless badly under-recruits year after year, partly because of the low birth-rate

that has been Russia’s problem for several generations and partly because anyone who can avoids the nominally compulsory service; its performance in Chechnya has been lamentable, though historically Russia has never done very well against guerrillas; and its own equipment remains less than cutting edge. A recent issue of the Eurasia Daily Monitor, produced by the Jamestown Foundation, talks of the Georgian President Mikheil Saakashvili deciding on modern Western military equipment for the small regular force, leaving the old Soviet era stock for the reserves. “Modern U.S. and Israeli equipment and arms are being procured, in some cases giving the Georgians capabilities the unreformed Russian forces do not have, like intelligencegathering drones.” Those East European and former Soviet states that have joined NATO have also started rearming with Western weaponry, which may well put them ahead of the Russian forces, should it ever come to that. CONTINUED ON PAGE 3

EYE ON EUROPE

IS RUSSIA RUNNING OUT OF GAS? CONTINUED

However, now in the leader’s second term, there has been a definite and notable shift in political emphasis and rhetoric. Sky-rocketing energy and commodity prices have swelled Russian state coffers, and Putin has used these riches not only to strengthen his position domestically by both neutralising political opposition and increasing social spending, but also to remind the world that Russia is a ‘great power’. Energy is the means by which Russia now seeks to establish a pole position for itself in the international system. It is true that Europe depends heavily on Russian energy. By 2020 the EU expects to be importing up to 70% of its energy, most of it from Russia. Pundits, such as The Financial Times’ Philip Stephens, have summed it up thus – Russia will use energy as a political tool against Europe. They point to Russia’s heavy-handed tactics with the Ukraine and Belarus, to Putin’s increasingly provocative and belligerent manner and choice of words, as well as to a number of international spats, including the sinister killing of the former Russian FSB agent Alexander Litvinenko in London last year.

The importance of energy for Russia cannot be underestimated. It accounts for over half of its exports and the majority of its federal income, in terms of both profits by state monopolies and taxes. Hikes in prices have led to unprecedented growth in Russia’s federal budget. Its surplus has been growing since 2001, reaching $64 billion in September 2007. High prices have also enabled Russia to pre-pay a large part of its Paris Club debt, and to create a Stabilisation Fund to maintain budgetary levels in the event that commodity prices, which reached $127 billion by mid-2007, should fall. It now also has the third largest foreign exchange reserves in the world. 2

Photo: Moaksey

In stark contrast to the 1990s when Russia experienced severe economic and social chaos, the first few years of the 21st century have been kinder to the world’s largest country. In Putin’s first presidential term, Russia not only saw political stabilisation and economic growth, but also a return to international respectability and participation in multilateral decision-making.

However, this overall influx of cash has also allowed the state to increase its social spending, greatly adding to Putin’s popularity; arguably the highest of any world leader. As domestic energy consumption is heavily subsidised, energy profits essentially stem from exports, the bulk of which go to the EU, and unlike Russia’s former Soviet allies, the EU pays full market price.The EU is also Russia’s largest investor. Its energy production has reached a plateau and is increasingly relying on a small number of mature fields. Rising demand, both internally in Russia, and externally in Europe and Asia, mean that unless Russia does something drastic to step up its production, it will soon be unable to fulfill its energy obligations – there could be a gas crunch as early as 2010. Additionally, although Russia is interested in expanding its energy exports to Asia, limited progress has been made in developing the necessary infrastructure. Russia’s pipelines lead to Europe, but Europe has other options where Russia does not: renewing its efforts for access to Middle Eastern energy, fortifying its already-strong links with North Africa and actively pursuing LNG (liquefied natural gas) development. Another matter for Europe to ponder is the fact that Russia has stated that it has two crucial aims on its foreign policy agenda – to create a multi-polar system in international relations and to simultaneously strengthen Russia’s sovereignty and protect its interests.These objectives are set out in a Russian Ministry of Foreign Affairs paper, which states that Russia ‘must be ready for the use of all of its available economic levers and resources to defend its interests’, and this is something that Russia has subsequently done. The significance of this statement could easily be overplayed to read that Russia will try to regain its former Soviet glory and ruthlessly use energy to this end – something which is evidently in conflict with its immediate interests.

Russophobia and doomsday-thinking is surely skewing realities in the minds of western politicians. Russia was right to raise energy prices to international levels; subsidising its neighbours makes no economic sense. Furthermore, it will have to eventually raise its domestic prices too – subsidies are due to be phased out by 2013. Russia, however, has to learn how to deal with these matters in a less brutish manner; the political opportunism evident in its choice and timing of these decisions simply feeds European mistrust. Secondly, Russia’s pursuit of multi-polarity appears entirely understandable. And, many would say, merely mirrors objections to US domination of the world system by emerging economic giants such as China, India and Brazil. Russia, however, is aware that these days economic power is absolutely crucial for international leverage. In order to have any kind of legitimate influence on world politics, it must first and foremost become a respected economic power, and one that is integrated into the global economy. If we are to believe Andris Piebalgs, the EU energy commissioner, the main impediment to progress at the moment is the EU’s lack of a single voice, and not Russian actions. Russia may, in fact, prove to be its own worst enemy, as its political ambitions are simply not matched by economic reality. If Russia genuinely wants to become an important international power, it should move towards developing its economy as a long-term aim in itself, and not use it as a means for pursuing short-term political ends. Gulya Isyanova is a Research Fellow at the Stockholm Network

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Book Review: Age of Turbulence: Adventures in a New World By Alan Greenspan Given Mr Greenspan’s deliberately wooden public persona, this should not be an interesting book. His statements as Fed chief were famous for their obfuscation.This is a man who memorised America’s train timetables by the age of eleven, missed the Draft because of a lung problem, and filed tax returns for his chums while they got high. But 40 years is a long time in politics, and this bookish, introverted man has a fascinating story to tell. He has worked near every American President since Richard Nixon, and under his stewardship, the US economy weathered the 1987 Stock Market Crash, the Russian, Asian and Latin American financial crises, and the dotcom bubble, not to mention the War on Terror. As chairman of the Fed since 1987, he has come to embody today’s fiscal orthodoxy of inflation targeting and liquidity control. The better half of this book is the autobiography. Mr Greenspan is humble but can be strikingly candid – he describes Bush Senior’s position on interest rates as ‘not a thoughtful view’. But what fascinates this reviewer is the paradox at the book’s heart. On the one hand, Mr Greenspan clearly feels that the US economy has become so complex as to be unknowable. Indeed, his RUSSIA’S NEAR ABROAD CONTINUED

That is the negative reason why there will not be a military show-down between Russia and Eastern Europe in the foreseeable future.The other reason is that Russia has found, or thinks it has found, a different way of pressurising its erstwhile colonies – economically. Apart from the many Russian firms, all of which have to pay obeisance to the government or end up like Mikhail Khodorkovsky or Boris Berezovsky have done (one in labour camp, one in exile under a permanent guard) that invest or take over business in Eastern Europe, there is the big question of energy supplies, on which these countries rely to a lesser or greater degree. Relying on Russia for energy would not be a problem if one could be certain that economic rather than political considerations were WINTER 2007

Staff Chief Executive Helen Disney Director of Research Dr Meir Pugatch Director of Development Dr Tim Evans Head of Communications Cara Walker

oft-quoted line ‘the American economy’s greatest strength is its resilience’ becomes touchingly meaningless on close inspection. On the other, most of the decisions he took were stupendously successful. In short, he doesn’t have a clue what’s going on, but he knows exactly what to do about it.This is the genius of Greenspan, and his career is a rare example of good, far-sighted leadership unfettered by the vice of democracy.

Network Development Manager Susie Squire

The second half of the book consists of a set of speculative essays which, while slightly ponderous, cover most of the big issues facing the global economy.These ideas have a pleasing logic to proponents of limited government: public spending is unproductive; using money unproductively debases it; debased money equals inflation. As a theory, it surely deserves greater research.

Research Fellow Gulya Isyanova

There is a great deal to take from this book, but the irony is that Greenspan’s insight is still likely to die with him. As the sub-prime mortgage fiasco mirrors the banking travails caused by the mid ‘90s real estate crash and Venezuelan hooligans test their populism to destruction for the hundredth time, the lessons of the Greenspan years are ones we must learn, re-learn and learn again.This book is an excellent place to start.

Energy Fellow Paul Domjan Research Fellow Jacob Arfwedson Research Fellow David Torstensson

Energy Research Officer Helen Davison Health and Welfare Research Officer Kristian Niemitz Intellectual Property and Competition Research Officer Sukanya Natarajan Office Manager and Events Co-ordinator Paul Healy Media Director Katie Perrior Adjunct Research Fellow Simon Moore

By Lawrence Freeborn

uppermost in the Russian government’s calculations.The nastiness of its government would not really matter as most oil and gas producing countries leave something to be desired in the democracy stakes. But Russia is special.The easing out of western oil and gas companies may have made short-term political but little long-term economic sense. Similarly, the supply of cheap energy to supporters in Ukraine and Belarus, with prices suddenly raised when those countries show signs of recalcitrance and supplies cut off as a threat of worse to come, indicate that the old thinking of politics above economics has not died. Russia’s aim in dealing with the European Union, for instance, appears to be an intention to drive a wedge between the older, western members and the newer, eastern ones.The Russo-German

pipeline that is planned to run under the Baltic Sea and has encountered a number of political obstacles, will, if it is ever completed, bypass Poland and the Baltic States and will, these countries fear, enable Russia to control their own supply of energy without affecting Western Europe, thus making it easier for her to put pressure on them. The question remains whether the European Union, having taken the former Communist countries in as members instead of negotiating trading agreements, will stand up to Russian pressure on their behalf. Helen Szamuely is a Research fellow at the Centre for Research into Post-Communist Economies in London.

EYE ON EUROPE

Less state, more wealth: the evidence from Slovakia With 8.3% GDP growth in 2006, Slovakia was the fastest growing OECD country last year. But this is no “one hit wonder” – the outlook remains very positive.

channelled to private pension funds, which manage and administer savings of the productive population. More than 1.5 million people choose a pension administration company and save their money in such private accounts.

In 2007, Slovakian growth will speed up to 8.7% and despite a predicted slow-down in 2008 (7.6%), there will still be no OECD country that can keep up.

3) In the health sector, introduction of a profitbased health insurance system led to the entry of 2 new private health insurance companies onto the market and the share of state owned health insurance companies has dropped from nearly 80% to 65% in the last 2 years.

This fast economic growth is accompanied with low inflation and falling unemployment rates; a combination which may rewrite books on economic theory. As recently as 2003 and 2004, inflation was high as a result of administrative changes (VAT increase) and price deregulation in the energy sector. In that period, the coreinflation remained very low and stable. In 2002 the unemployment rate was 18.6% – in 2008 it will drop to 10.3%.

In health care, reforms were aimed at increasing the responsibility of the consumer for his/her own health (user fees, higher co-payments on drugs, co-payments for non compliance), increasing the responsibility of health insurance companies in purchasing health care services (for profit orientation, hard budgetary constraints, corporate governance, solvency monitoring) and increasing the responsibility of providers in assuring quality (mandatory systems of quality, strong oversight by the Health Care Surveillance Authority, separation of rules creation and oversight).

Last, but not least, during recent years the general tax burden has been reduced. With 29.6% tax revenues on GDP, Slovakia has the fifth lowest overall tax burden among OECD countries.

Neighbouring countries have taken inspiration from the Slovak approach:

Measured per capita, in 2008 Slovakia will be the biggest car producer in the world. With Volkswagen, KIA and Peugeot Citroen within a circle of 200 km, Slovakia has been dubbed the Detroit of Eastern Europe. Production next year will reach more than 850,000 cars which will make up more than 30% of total exports.

Evidence from Slovakia shows that flat tax:

1) The Czechs introduced a light version of flat tax (with a promise to extend it next year) and from 1 January 2008 the Czech Republic will have user fees for doctors’ visits or hospital stays and is aiming to introduce for-profit health insurance companies as of 2009.

1) Increases motivation to work and decreases tax evasion – between 2003 (last year before flat tax) and 2005 (first year after flat tax) the overall tax base rose by 48.4%. Within these two years, the tax base of corporations rose by 90.2% and the tax base of individuals rose by 33.7%.

2) In 2007 the Hungarians introduced user fees in health care and as of January 2007 established the Hungarian Health Care Surveillance Authority and are preparing the de-monopolisation and liberalisation of health care insurance.

The causes Unlike in the 1990s, when economic growth was accelerated mainly by state investments, the main driving forces of GDP growth are private consumption, foreign investments and exports. This structural change is the consequence of a market friendly environment created by the previous liberal government from 2002 to 2006.

2) Is “pro social”. Research clearly shows that in the flat tax regime, low earners pay much less tax than before. Moreover, 45% of taxpayers do not pay personal income tax and receive money from the state due to high deductibles and negative tax effects in the form of child bonuses.

As our neighbours are inspired by Slovakia, however, the new Slovak government has slowly begun deconstructing the symbols of the pro-reform government. User fees in healthcare have been abolished, an unsystematic 10% VAT rate has been introduced for certain products, and on 25 October 2007 the government nationalised the profits of health insurance companies via the exclusion of profit distribution to shareholders. Let’s hope Slovakia will find the courage to learn from its own dazzling economic history and uphold economic stability, growth and opportunity.

The reforms The 19% flat income tax, with single 19% VAT rate and 0% tax on dividends is considered the core of the Slovak reforms.

In line with this general pro-market orientation, the role of government was reduced in many sectors:

2) In the pension system, half of the monies accrued through social insurance have been 4

Peter Pazitny` is the Director of the Health Policy Institute in Bratislava

Photo:Veronika Kunderova

1) In the energy sector, 66% of shares of the monopolistic electric power producer Slovenské elektrárne was sold to Enel and 49% of the Gas Transport and Distribution Company Slovenky` plynárensky` priemysel was sold to Ruhrgas and Gaz de France.The Slovakian state controls 51% of shares in the electricity distribution companies – the remaining stake was sold to EON (Western Slovakia), Electricité de France (Central Slovakia) and RWE (Eastern Slovakia).

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The Lisbon Strategy – a perpetual start We all know what was agreed at the European Council meeting in 2000 in Lisbon. By 2010 the European Union will have become the most dynamic and competitive knowledgebased society with balanced economic growth, more and better jobs, greater social cohesion with a focus on the environment. Not only ambitious, but also difficult to read and to remember. Ask a civil servant from the Commission: what is the Lisbon Strategy? I can predict the answer: ‘The Lisbon Strategy is made up of four pillars: growth, innovation, employment and social cohesion.’ But how one can ‘sell’ this miraculous explanation to the average citizen? The Lisbon Strategy is not a ‘pillar construction’, nor a programme of national reforms, it is simply a better future for Europe. It is hard to challenge the Lisbon goals. In fact, they virtually command universal support. Governments are committed to them.The European parliament supports them. Both the European Employers’ Federation and the European Trade Unions Congress strongly endorse them. So why do most people think the EU, represented by all the above mentioned actors, is unable to deliver on such a seemingly uncontroversial reform agenda? Lisbon rests on the belief that the member states have a common interest in co-ordinating structural reform policies.The underlying rationale draws on two series of arguments. First, it assumes that countries may gain from undertaking reforms jointly. Second, it is expected that they may learn from each other’s experience and that the EU may help provide an assessment of what works and what does not. At the normative level, the Lisbon Strategy has been quite a success. A lot of the legislative measures announced in the year 2000 have in fact been adopted during the last seven years. At the EU level, for example, more than 70 directives have been adopted that enable the greater harmonisation and monitoring of the internal market, increase competition and create further potential for economic growth. But the perception is still that the Lisbon Strategy is a failure. Ultimately, a journalist would rather WINTER 2007

write about the imminent failure of the Strategy and sometimes it feels that we are competing as to who will bury it in a more poetic way. Furthermore, the harshest critics of the Lisbon Strategy are being hypocritical.There is no institutional reform to establish a less rigid decision-making system. The European Union is a community of diversity. The same table is shared by a prime minister of a country boasting a GDP of €50,000 per capita, and a leader of a state in which the average citizen produces a mere €7,500.The same table is shared by decision maker of a country that invests 4.3% of its GDP in R&D and representatives of a member state that allocates only 0.3% of its GDP to this sector. Yet, despite this, GDP growth in the EU was 2.9% in 2006 and is projected to remain at that level in 2007. Europe’s business sector is blossoming.The EU created 3 million jobs in 2006. Unemployment is down to 7.5%; still too high, but going the right way. The EU is simply a miracle.There is not a single democratic entity in the world like the EU: 23 official languages; meetings open to the general public and even broadcasted online; the European Ombudsman. President of the European Commission Mr. Barosso told the participants at the March meeting at the Centre for European Reform:

‘Too often, we talk about Lisbon in terms of abstract policies. But Lisbon is about people. Jobs, pensions, access to healthcare, children’s education.’ Concrete, easy-to-understand words, that’s what we need. Due to its word gymnastics Europeans still tend to regard the EU as a laboratory for what the world of tomorrow could look like. In the Stockholm Network paper Beyond Lisbon you speak of several reasons for the possible failure of the Lisbon Strategy. Among other things, you regret the fact that the EU has not managed to harmonise legislation relating to intellectual property and that the attempt to harmonise the EU patent system via the standard EU political track has failed. Here you hit on the core of the problem. The March EU Summit headed up by Slovenia will provide the first opportunity to obtain a realistic estimate of how far Lisbon II has brought us. I am convinced that we will see that it is worthwhile putting extra effort into the next round so that Lisbon III will provide effective answers to future challenges. In the words of the President of the European Commission, ‘We are talking about a job started, not a job done.’ He is right: the Lisbon Strategy is a perpetual start. Anze Logar is Head of the Government Communication Office, Slovenia

EYE ON EUROPE

DIRECTOR’S REPORT

As this issue of Eye on Europe went to press, Slovenia was on the cusp of taking over the Presidency of the European Union, being the first of the new member states to assume this important role. Never one to rest on its laurels, the Stockholm Network has already opened up a debate with the Slovenians over one of the key issues for the next 6 months – the issue of innovation and the Lisbon Agenda. Our Brussels event on the issue, addressed by Anze Logar is summarised here and will form part of a wider project the Stockholm Network will be working on in 2008, looking at the progress of innovation across the EU. 6

Central and eastern European themes are becoming more integral to European policy debates since the accession of new member states in 2004 and 2007, in a host of areas from energy policy to labour markets, to healthcare. Our Winter issue reflects this growing influence with articles from our research fellow and Russian national, Gulya Isyanova on Russian energy policy, updates from SN member think tanks in the region, as well as a report from a recent Amigo Society debate on the advance of the hot topic of immigration and the so-called ‘Polish plumber’.

experience and what do they still have left to do to bring the region’s healthcare provision into line with modern expectations of patients? A new section of our website, a series of events and a programme of research under our Health and Welfare platform will examine these issues over the next 12 months and beyond. We hope you will provide us with feedback from your experiences of reform and help us to continue to share best practice in policy thinking from east or west – indeed, wherever it may be found.

Last but not least, this year we are launching a new initiative looking in more depth at modernisation and reform of healthcare in CEE countries. What can we learn from their ISSUE FOURTEEN

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Spotlight on the Stockholm Network Health and Welfare Programme:

NEW FRONTIERS Our Health and Welfare programme is working on some key, yet often overlooked, areas of policy. One area where the Stockholm Network is breaking new ground is Health Technology Assessment (HTA). Roughly speaking, HTA denotes the use of ‘cost-effectiveness-analyses’ to determine which benefits a public health care system should provide and which they should not. Politicians increasingly rely on the findings of these appraisals. One might expect that such a significant policy shift would involve intense public debates. But peculiarly, the rise of HTA has largely taken place without a major debate accompanying it or a political theory grounding it. It is even stranger that opinion formers such as journalists and even think tanks are still neglecting the topic. If one finds position papers on HTA, they are generally issued by a patient group or a pharmaceutical company, opposing the recommendation of an HTA body against a drug of particular relevance to them. The Stockholm Network has decided to fill this gap and systematically ‘study the beast’. In a topical paper series, we have analysed which factors drive the dissemination of HTA, how this evaluation technique works and what it can and cannot achieve. We also think of potential policy alternatives. Our next plan is to set up an ‘HTA task force’, which will organise topic-related conferences with acknowledged experts. As well as analyzing the technicalities of specialised government policies like HTA, think tanks also need to step back and look at the big picture, from time to time we re-visit some really fundamental questions regarding the broad role of both government and free markets within social policy.This is what we have aimed to do in our upcoming think piece Can Free Market Solutions Salvage the Collapsing Welfare State? The publication examines what the modern welfare state looks like and what the major challenges are in 3 important areas of public policy: education, health care, and pensions. At the same time, we have sharpened our profile on a different front: the demographic time-bomb threatening European public pension systems. Some observers have asked whether funded pensions, where each individual WINTER 2007

accumulates capital reserves in a retirement savings account throughout a working life, could be a more robust alternative. But why do we discuss the feasibility of such a concept only in hypothetical terms, when an excellent showcase already exists? Our publication Private Pension Provision: What an Ageing Europe Can Learn from a Latin Tiger analyses the fully funded pension system that was enacted in Chile 27 years ago. Its findings are various, but one point can already be pre-empted: the arguments usually made by critics, such as the assertion that private pensions are unstable, have all been thoroughly refuted by the Andean republic. Chile, however, is not Europe.This paper puts special emphasis on the driving forces behind the outcomes, to show which aspects of the Chilean experience are transferable to Europe and which are not.

which has recently been re-launched. Gesundheit! informs our readers about interesting recent developments in social policy across Europe, and beyond.The first issue features contributions from José Piñera, the father of the abovementioned Chilean pension privatisation, and Peter Tatar, one of the movers behind the market-driven health care reforms of Slovakia in recent years. Gesundheit! also introduces an debate forum in the form of a Head-to-Head section.You can subscribe to Gesundheit! through our website www.stockholm-network.org All publications of the Health and Welfare programme are available under the ‘Publications’ section on our website. For more information, please contact kristian@stockholm-network.org

Does a Chilean pension reform of 1981 bear any relation to the Slovak health care reform of 2005/06? Of course it does! Both shared a common goal: to permit passive recipients of government welfare to become selfdetermined consumers, who make independent choices.This is also the it of the Health and Welfare programme’s bi-monthly newsletter, 7

EYE ON EUROPE

PROFILE: The Ludwig von Mises Institute Romania www.misesromania.org The Ludwig von Mises Institute Romania was officially created in 2001 by several participants – mostly students and young university professors – of an existing informal seminar led by Cristian Coma˘ nescu.

The Mises Seminar has a year-old sibling called “Small Books, Great Ideas” designed for the (usually first year) university students who are interested in the Austrian School but are very new to it.

a good understanding of sound economic principles is the prerequisite for the introduction of good and durable policies.

Done To Our Money and a collection including Mises’ Bureaucracy – his crucial article on calculation and its postscript by Salerno.

In line with the above, we have decided since 2001 to create a translation and online publishing programme.The purpose of the programme is to make available in Romanian and at virtually no cost on our website as many important works of the Austrian School as possible.The translation of Mises’ masterpiece Human Action is a big project that is expected to finish in 2008.

We are also planning to continue and extend our efforts to disseminate fundamental ideas. For the near future we are thinking about an international seminar on Orthodoxy and Liberty. Also we are planning to have Human Action printed in a deluxe edition.

“We believe in the social order of ultimate private property and in the free markets and peace that would result thereof ”

In the six years since its creation the website has grown tremendously and, as well as the many books and articles hosted, it now also features an online publication called The Private Property Order, and a blog.

We believe in the social order of ultimate private property and in the free markets and peace that would result thereof. We are also studying to what extent a sustainable order of private property relies on widespread Christianity, with its beliefs about the personality of the human being and its continued existence after death.

“We believe that a good understanding of sound economic principles is the prerequisite for the introduction of good and durable policies”

On a more tactical level, we believe that in Romanian culture there is a great need for basic economic education. We believe that

For the coming years we want to make ourselves more visible to the public and especially to students, placing emphasis on influencing the thought of university professors.

We have started printing books for people who do not have access to the internet on a daily basis and/or prefer more traditional methods of research.Thus far we have published Rothbard’s What Has Government

Photo: Dmitry Ivanov

Since 1993, this seminar called the Mises Seminar, has been discussing, the ideas of the Austrian School of Economics and can be considered the heart of the institute. It is the medium through which new students approach our Institute and it encourages them to progress into accomplished thinkers. It consists of bi-weekly meetings of up to twelve people discussing an essential work in the tradition of the Austrian School of Law and Economics. It has an interdisciplinary nature, attracting students from Economics, Philosophy and Law.

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then it should not be an issue.This raised the third question: what kind of society will you have if the ballot box is the sole arbiter of justice?

www.itdis.org The crisis-point of the post-communist period for Hungary occurred in the summer of 2002.The reformed communists had just been re-elected and within weeks of their victory, a leading daily published evidence that the new prime minister had been an officer in the secret police. A parliamentary committee was established to investigate the allegation that Peter Medgyessy had been officer ‘D-209’ in the III/II, the directorate responsible for combating western espionage in communist Hungary. I served on that committee as an independent expert and was at that time known in Hungary simply as an expert on national security affairs and counter-terrorism. This raised the question: can you build a stable, functioning democracy on lies? Second, many people in Hungary seemed willing, even eager, to accept this situation. Once Medgyessy admitted to having been officer D-209, he then told how his sole task had been to defend Hungary’s entry into the IMF from Russian interference. Finally, there was a third aspect of the crisis, and this was much more personal. As a result of having served on this committee, I was forced to resign from my position as head of an independent policy institute and was black-listed by the Hungarian media after having been a regular commentator on security affairs. I discovered, painfully, that it is not considered good form to discuss the communist past. Even friends at Western embassies, whom I assumed would take a stance similar to mine, argued that if the electorate does not care that their prime minister was an officer in the secret police, or that anyone in an elected position was a former communist,

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The answer to all these questions lay in the very nature of the transition itself.Through that social and political crisis, which began in 2002 and continues in Hungary to this day, I came to see that democratic institutions and free markets could not, by themselves, create healthy functioning societies from the wreckage of communism.Yet that is how transition has been conceived. It is viewed primarily as an institutional process: if we simply change one set of institutions for another, all will be well. We fail to recognise that institutions cannot create a certain type of society (to think that they can was communism’s greatest error); institutions merely reflect a certain type of society. In trying to help our countries recover from communism, we should have concentrated much more on healing and rebuilding subsidiary institutions—families, churches, schools and NGOs. It is largely through these institutions, and not through the state, that you create the cultural foundation on which democracy can stand, a culture which understands and respects the rule of law, which respects private property, which upholds the dignity of the human being, holds truth above lies, kindness above cruelty, decency above misdeed, right above wrong. This crisis helped me see more clearly the real challenges facing Hungary, challenges that I think are common to many post-communist countries.Together with my wife, an American who has been working in the region since1990, we decided to create ITDIS in the months after the Medgyessy Commission because we realised that we could not say the important things that needed saying without true independence. And secondly we saw the very grave need to reformulate the nature of democratic transition. In countries that have been devastated by tyranny or conflict, as important as the institutions of free societies, notably democratic government and market economies, is the reestablishment of the values on which free societies can be founded. Therefore we see our work as multi-faceted. We address issues such as dishonesty and corruption among our public officials, the nature of individual freedom, the importance of individual responsibility and active engagement. In Hungary, particularly, there is also a lot of work to be done in making clear the link

between individual liberty and free markets. There is still a great attachment to state paternalism. People do not realise the price they pay for that paternalism in terms of high taxes, poor services, inadequate health care, lack of choice, and lack of accountability by service providers. Tackling these issues in post-communist countries remains a difficult task. Foremost, it is difficult because of the financial environment. Most policy institutes are funded by the government. We have been very fortunate and have found another organisation of very likeminded individuals—the Educational Initiative for Central and Eastern Europe (www.eicee.org). EICEE is a U.S.-based organisation that comprises the Neuwaldegg Institute in Vienna, the Civic Institute in Prague, and now us, in Budapest.The task of bringing about meaningful and long-lasting reforms in Central and Eastern Europe that will safeguard individual security, freedom, and prosperity is bigger than any one individual or organisation can accomplish alone. But by bringing together our diverse talents and resources we greatly improve our chances of success. Freedom and prosperity in Central and Eastern Europe depend on it. Sebestyén L. v. Gorka is the Director of ITDIS

Photo: www.flickr.com/photos/natashap

PROFILE: Institute for Transitional Democracy and International Security

“What kind of society will you have if the ballot box is the sole arbiter of justice?”

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PROFILE: F. A. Hayek Foundation www.hayek.sk The F. A. Hayek Foundation Bratislava is an independent and non-political, non-profit organisation, founded in 1991, by a group of liberal oriented Slovak economists. “The core mission of the F. A. Hayek Foundation is to establish a tradition of market-oriented thinking in Slovakia – an approach that did not exist before the 1990s in our region,” explains Dr. Jan Oravec, President of the Institute and one of the Slovakia’s leading economists. “Our main mission covers two issues; economic and social reforms, and improving basic economic understanding in the public,” adds Martin Chren, the Institute’s Director.

“I strongly support the approach of the F. A. Hayek Foundation which regards the freedom of the individual as the key objective of a good society” – Milton Friedman 10

Another achievement which, at least in part, holds the Hayek Foundation’s signature, is the introduction of a flat, 19% income tax in Slovakia in 2004.The idea of a flat tax was introduced by the Institute, and followed by a mass media campaign in the years before it was adopted. In 2003, American media owner, presidential candidate and flat tax campaigner Steve Forbes accepted the Foundation’s invitation and persuaded several Slovak political parties to include this idea into their political agendas, which was later adopted. One of the most successful projects of our institute was the founding of the Slovak Taxpayers’ Association, which fights against excessive financial tax burdens on citizens and businesses and tries to increase public awareness about tax matters. Promoting a balanced state budget, lower taxes and public expenditures, the Slovak Taxpayers’ Association has become of the best recognised public policy organisations in Slovakia, with 51% public recognition according to a recent public opinion poll.

“A retrospective look at our activities provides satisfaction,” says Dr. Oravec. “Thanks to the activities of the Foundation there are more and more people who – unlike in the past – do not believe any more that it is the responsibility of the government to take care of them, but they themselves must be their own masters and take care of their own fate. And thanks to the activities of the Foundation there are more and more people who believe that the government’s responsibilities are too many and should be reduced so that the government’s interference with the implementation of their own plans is minimised.”

Photo: Anthony Citrano

The F. A. Hayek Foundation remains active in several areas of public policy: pension reform, taxation, public finance, EU integration and harmonisation, privatisation, education reform, and many others. Experts from the Foundation created most of the pension reform team in Slovakia back in 2002 and 2003.They were responsible for the privatisation of part of the country’s unfunded pay-as-you-go system. Ivan Svejna, chairman of the F. A. Hayek Foundation’s board, became the leader of the pension reform team. “Thanks to us, Slovak workers were given the choice to opt out of the unfunded and unsustainable governmentrun pension system, and start contributing 9% of their gross wages to their own private personal retirement accounts,” explains Mr. Svejna.The team of Hayek Foundation experts also cooperated with Jose Pinera, the world renowned reformer from Chile and author of the first pension reform in the world.

In 2004,The F. A. Hayek Foundation was awarded the Templeton Freedom Award for Institute Excellence for its impact and efforts in promoting liberty and market principles in Slovakia.

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PROFILE: Centre for Liberal Strategies A daunting task. Europe seems as ambiguous and confused about political and economic freedom and about the importance of human individuals and the opportunities they are given to improve their lives as we Bulgarians are.

www.cls-sofia.org CENTRE FOR WHAT? We at CLS have had to face this question ever since our founding in 1995. As we insist on freedom, we feel free to answer it backwards.

For this reason, we would appreciate contacts with other research organisations, who perceive the issues facing the EU in a similar way.

So we start with strategies. We are in the business of strategies, because when confronted with the highly irritating question of how to implement what we recommend, we want to be in the position of the owl who advised the rabbit to become a lion, and on the question how, replied with a touch of disgust: “Oh, this is not our business, we deal only with strategies!.”

We continue with liberal. While we feel strongly about the meaning of strategies, we have decided to let everyone feel free to think of liberal whatever they like. In short, we are a bunch of people who believe that if freedoms exist citizens have guaranteed rights and access to opportunities and initiative, they will live better and happier lives.

“The CLS strives to be an analytical bull in the china shop of practical politics” The CLS is a think tank in Bulgaria – a culture where think tank is an untranslatable word. It is an independent policy institute in an environment where both politics and policy are translated with one word: politika. It strives to be an analytical bull in the China shop of practical politics. To make the long term perspective operational, we try to study as rigorously as possible the deep, structural processes of Bulgarian society.

WINTER 2007

That includes examining its democracy, but also the deeper attitudes towards public sphere in general, towards social life and its structure, towards security and justice and their upholding. We have done this through a series of research projects we call “the state of society”. Another direction of deeper research is the economy. Besides the usual analysis of current indicators we also look at the fundamental beliefs of Bulgarians about how the economy works, about markets and the alternative mechanisms of allocating resources. Recently a more than ten year research effort in this direction came to fruition with the book Communal Capitalism which brings to the surface seemingly whimsical, but very deep links between yesterday and today and shows the long-standing, resilient roots of the communal (statist, clan, or collectivist) principles, which have never stopped undermining full-blooded competition in the economy. Since the late 1990s we have tried to expand this type of highly local and contextual knowledge to our fellow societies around Bulgaria in the region known as “the powder keg of Europe” – the Balkans. Even more recently we are trying to grasp the same types of issues in the context of the European Union.

Photo: Iliyan Hristov

In other words, we do strategies because we believe the short term always takes care of itself, while the necessity to think about long term implications is always present and always in short supply.

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Europe has nothing to fear from Polish plumbers since an ever-increasing share of our prosperity comes from solving problems – developing new medicines, environmentally-friendly technologies and original business models. Look at Silicon Valley: Google,Yahoo! and eBay were all co-founded by immigrants who arrived not as university graduates, but as children. Nearly half of America’s venture-capital-backed start-ups have immigrant co-founders. Since diversity boosts innovation, which is the source of most economic growth, critics who claim that immigration has few or no economic benefits are profoundly mistaken.

No government, except perhaps North Korea’s, would dream of banning crossborder trade in goods and services, yet it is seen as perfectly reasonable to try to ban the movement across borders of most people who produce goods and services. Even within the EU, for which the free movement of labour is meant to be a fundamental principle, restrictions still exist. Europe’s labour market remains firmly closed to most people from developing countries. This is perverse. Immigrants are not an invading army, they are mostly people seeking a better life who are drawn to western Europe to fill the lowend jobs that our ageing and increasingly wealthy societies rely on but which our increasingly welleducated and comfortable citizens are unwilling to take. Polish plumbers, Filipino care-workers and Congolese cleaners are simply serviceproviders who ply their trade abroad, just as European IT specialists do. And just as it is often mutually beneficial to import computers from China, IT services from India and investmentbanking services from Americans, it often makes sense to import menial services, such as cleaning, that have to be delivered on the spot. Our efforts to keep poor people out while the rich and the educated circulate freely are economically stupid, politically unsustainable and morally wrong. Freedom of movement is a basic 12

human right, as anyone who is denied it can confirm. We in rich countries take it for granted that we are free to move around the world more or less as we please. We go on foreign holidays; many of us study and work abroad for a while; some of us end up settling elsewhere.Why, then, do we seek to deny this right to others? Freeing up migration makes economic sense. One study suggests that abolishing all immigration controls could double the size of the world economy; even a small relaxation would yield huge gains. Migrants from poor countries can earn wages many times higher in rich ones, and the money they send home – perhaps some $600 billion in total – dwarfs the $100 billion that Western governments give in aid. And when migrants return home, they bring with them new skills, ideas and the money to start new businesses that boost the local economy. Rich countries also benefit from receiving immigrants, both high and low skilled.To compete in global markets, companies need to draw on the widest possible pool of talent – not just for foreigners’ individual skills and drive, but for their collective diversity. Immigrants tend to see things differently, and as outsiders they are more determined to succeed. 21 of Britain’s Nobel-prize winners arrived in the country as refugees. Foreigners with different ideas, perspectives and experiences can help solve problems better and faster, as a growing volume of research shows.That is crucial,

Europe also benefits from low-skilled migration. Many low-skilled services cannot readily be mechanised or imported: the elderly cannot be cared for by a robot or from abroad; cabdrivers have to operate locally; hotels, hospitals and streets have to be cleaned on the spot. And as people get richer, they increasingly pay others to do arduous tasks, such as home improvements, that they once did themselves, freeing up time for more productive work or more enjoyable leisure.Thus as advanced economies create highskilled jobs, they inevitably create low-skilled ones too. But while low-skilled jobs account for over a quarter of the labour force in western Europe, the supply of low-skilled workers is shrinking. Whereas only half of western Europeans aged 55–64 have finished secondary school, four-fifths of 25–34 year olds have, and high-school graduates understandably aspire to better things, while even those with no qualifications don’t want to do certain dirty, difficult and dangerous jobs. But immigrants face a different set of alternatives: since wages in London are much higher than in Warsaw, Poles are happy doing such work.This is not exploitation: it makes everyone better off. It does not undercut wages, since Britons do not want to do these jobs in any case. And it need not undermine social standards: if there is abuse, legal migrants have recourse to unions and the law. Fears about jobs are misplaced. Just as women working have not deprived men of work, immigrants don’t just take jobs, they also create them – as they spend their wages, which fuels demand for people to produce the goods and services they consume, and as they work, which stimulates demand for complementary workers. An influx of Polish builders, for instance, boosts demand for those selling building supplies, as ISSUE FOURTEEN

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well as for interior designers. While Spain has had the highest immigration in Europe in recent years, its employment rate has shot up. Far from competing with natives, immigrants often complement their efforts: a foreign childminder may allow a local doctor to return to work, where her productivity is enhanced by hard-working foreign nurses and cleaners. And because immigrants are more willing to move to where the jobs are, and to shift jobs as conditions change, they make the economy more flexible, allowing it to grow faster for longer without sparking inflation. France and Germany would have much to gain from allowing in the much-maligned Polish plumber.

ABOUT THE NETWORK The Stockholm Network is the leading pan-European think tank and market-oriented network. It is a one-stop shop for organisations seeking to work with Europe’s brightest policymakers and thinkers. Today, the Stockholm Network brings together over 120 marketoriented think tanks from across Europe, giving us the capacity to deliver local reform messages and locally-tailored global messages across the EU and beyond. Combined, the think tanks in our network publish thousands of op-eds in the high quality European press, produce many hundreds of publications, and hold a wide range of conferences, seminars and meetings. As such, the Stockholm Network and its member organisations influence many millions of Europeans every year. WINTER 2007

Psychological studies confirm that opposition to immigration tends to stem from an emotional dislike of foreigners. Intelligent critics then construct an elaborate set of seemingly rational arguments to justify their prejudice. When immigrants are out of work, they are scrounging on welfare; when they are working, they are stealing our jobs. One British politician bemoaned that Poles were earning misery wages and living in squalid conditions twelve to a room, and then blamed them for rising house prices. Immigrants can’t win: they’re damned if they do and damned if they don’t. So while it’s important to address people’s fears and consider their arguments, it is also important to see them for what they often are: a rationalisation of xenophobia. Immigration also broadens the range of cultural experiences available, and this mingling of cultures leads to distinctive innovations: fusion food, R&B music, power yoga. It provides the opportunity to lead a richer life by meeting people from different backgrounds: friends, colleagues and even a life partner. As John Stuart Mill said: “It is hardly possible to overrate the value, for the improvement of human beings, of things which bring them into contact with

persons dissimilar to themselves, and with modes of thought and action unlike those with which they are familiar… there is no nation which does not need to borrow from others.” We have every interest to make the best of immigration, because governments cannot stop people moving across borders. Draconian policies mostly drive migration underground. Instead of fighting a costly and unwinnable war against migration, we should treat it is an opportunity to create an open, dynamic and progressive society. Allowing people to move freely may seem unrealistic, but so too, once, did abolishing slavery or giving women the vote. Campaigning for open borders is a noble cause for our time. Philippe Legrain is a visiting fellow at the London School of Economics’ European Institute. His latest book, Immigrants:Your Country Needs Them, was shortlisted for the Financial Times Goldman Sachs business book of the year award. He blogs at www.philippelegrain.com

POLICY ISSUES

WHAT DO WE DO

The Network is a forum for sharing, exchanging and developing pan-European research and best practice. Interested in ideas which stimulate economic growth and help people to help themselves, we promote and raise awareness of policies which create the social and economic conditions for a free society.These include:

We conduct pan-European research on, and create a wider audience for, marketoriented policy ideas in Europe. Our website contains a comprehensive directory of European free market think tanks and thinkers. We advertise forthcoming events (our own and those of partner organisations) and facilitate publication exchange and translation between think tanks. We also post regular news flashes and updates on European think tanks and their activities.

Reforming European welfare states and creating a more flexible labour market. Updating European pension systems to empower individuals. Ensuring more consumer-driven healthcare, through reform of European health systems and markets. Encouraging an informed debate on intellectual property rights as an incentive to innovate and develop new knowledge in the future, whilst ensuring wide public access to such products in the present. Reforming European energy markets to ensure the most beneficial balance between economic growth and environmental quality. Emphasising the benefits of globalisation, trade and competition and creating an understanding of free market ideas and institutions

Would you like to join the Stockholm Network? Please contact us on +44 20 7354 8888 or email info@stockholm-network.org

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The Stockholm Network is the leading pan-European think tank and market-oriented network. Spanning almost 40 countries and 130+ think tanks, our unique organisation has the capacity to deliver local messages and locally-tailored global messages across the EU and beyond.

Through our publications, weekly newsletter, and special events, members are able to exchange ideas and make an impact on a wide range of public policy topics and ideas. If you know of a new organisation you think would benefit from Stockholm Network membership, please contact our office at info@stockholm-network.org and let us know.

“Too many of Western Europe’s economies are sclerotic and in desperate need of reform.The Stockholm Network plays a crucial role in linking Europe’s market-orientated think tanks, promoting the ideas that are essential if Europe is to have a brighter future”. Nick Herbert MP

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Adam Smith Institute www.adamsmith.org United Kingdom Adam Smith Society www.adamsmith.it Italy Adriatic Institute for Public Policy www.adriaticinstitute.org Croatia Albanian Liberal Institute www.liberalb.org Albania Anders Chydenius Foundation www.chydenius.net Finland Association for Liberal Thinking www.liberal-dt.org.tr Turkey Association for Modern Economy www.ame.org.mk Macedonia Avenir Suisse www.avenir-suisse.ch Switzerland Bulgarian Society for Individual Liberty www.libertarium.net Bulgaria Captus www.captus.nu Sweden Causa Liberal www.causaliberal.net Portugal Centre for Economic Development www.ced.bg Bulgaria Centre for Economic Development www.cphr.sk Slovakia Centre for Economics and Politics cepin.cz Czech Republic Centre for Entrepreneurship and Economic Development www.visit-ceed.org Montenegro Centre for European Policy www.cep.eu Germany Centre for European Reform www.cer.org.uk United Kingdom Centre for Institutional Analysis and Development www.cadi.ro Romania Centre for Liberal Strategies www.cls-sofia.org Bulgaria Centre for Liberal-Democratic Studies www.clds.org.yu Serbia Centre for Policy Studies www.cps.org.uk United Kingdom Centre for Political Thought www.omp.org.pl Poland Centre for Research into Post-Communist Economies www.crce.org.uk United Kingdom Centre for Social and Economic Research www.case.com.pl Poland Centre for the New Europe www.cne.org Belgium Centre for the Study of Democracy www.csd.bg Bulgaria Centro Einaudi www.centroeinaudi.it Italy Centrum im. Adama Smitha www.smith.pl Poland CEPOS www.cepos.dk Denmark Cercles Liberaux www.cerclesliberaux.com France CFACT Deutschland www.cfact.eu Berlin Civic Institute www.obcinst.cz Czech Republic Civita www.civita.no Norway

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34 Civitas www.civitas.org.uk United Kingdom 35 Club 2015 www.club2015.org Bosnia 36 Conservative Institute of M. R. Stefanik www.institute.sk Slovakia 37 Council on Public Policy www.council.uni-bayreuth.de Germany 38 E.G.West Centre UK www.ncl.ac.uk/egwest United Kingdom 39 ECIPE www.ecipe.org Belgium 40 Economic Policy Research Institute www.epri-macedonia.org Macedonia 41 Ekome (Society for Social and Economic Studies) www.ekome.gr Greece 42 Eudoxa www.eudoxa.se Sweden 43 Euro 92 www.euro92.com France 44 European Ideas Network www.epp-ed.org/europeanideasnetwork Belgium 45 EVA www.eva.fi Finland 46 F. A. Hayek Institute www.hayek-institut.at Austria 47 FAES www.fundacionfaes.org Spain 48 Fondation pour l’innovation politique www.fondapol.org France 49 Foundation for Market Economy www.fme.hu Hungary 50 Friedrich August von Hayek Stiftung www.hayek-stiftung.de Germany 51 Frédéric Bastiat Stichting www.bastiatstichting.nl The Netherlands 52 FREE (Forum Rozwoju Edukacji Ekonomicznej) www.free.org.pl Poland 53 Free Market Centre www.fmc.org.yu Serbia 54 Free Minds Association Azerbaijan 55 Friedrich Naumann Stiftung www.fnst.de Germany 56 Friedrich von Hayek Gesellschaft www.hayek.de Germany 57 Fundacio Catalunya Oberta www.catalunyaoberta.net Spain 58 Gdansk Institute for Market Economics www.ibngr.edu.pl Poland 59 Global Vision www.global-vision.net United Kingdom 60 Hamburg Institute for International Economics www.hwwi.org Germany 61 Hayek Foundation www.hayek.ru Russia 62 Health Consumer Powerhouse www.healthpowerhouse.com Belgium 63 Health Policy Institute www.hpi.sk Slovakia 64 Health Reform.cz www.healthreform.cz Czech Republic 65 Hellenic Leadership Institute www.hli.gr Greece 66 iFRAP (French Institute for Research into Public Administration) www.ifrap.org France

67 INEKO www.ineko.sk/english Slovakia 68 Institución Futuro www.ifuturo.org Spain 69 Institut Constant de Rebecque www.institutconstant.ch Switzerland 70 Institut Economique Molinari www.institutmolinari.org Belgium 71 Institut Hayek www.fahayek.org Belgium 72 Institut Montaigne www.institutmontaigne.org France 73 Institut Turgot www.turgot.org France 74 Institute for Economic Studies Europe www.ies-europe.org France 75 Institute for Free Enterprise www.unternehmerische-freiheit.de Germany 76 Institute for Free Society www.isloboda.sk Slovakia 77 Institute for Market Economics www.ime-bg.org Bulgaria 78 Institute for Strategic Studies and Prognosis www.isspm.org Montenegro 79 Institute for Transitional Democracy and International Security www.itdis.org Hungary 80 Institute of Economic and Social Studies www.iness.sk Slovakia 81 Instituto Juan de Mariana www.juandemariana.org Spain 82 Instytut Globalizacji www.globalizacja.org Poland 83 Instytut Liberalno-Konserwatywny www.ilk.lublin.pl Poland 84 International Policy Network www.policynetwork.net United Kingdom 85 Intertic www.intertic.org Italy 86 Istituto Acton www.acton.org Italy 87 Istituto Bruno Leoni www.brunoleoni.it Italy 88 Jerusalem Instiute for Market Studies www.jims-israel.org Israel 89 Liberales Institut eng.libinst.ch Switzerland 90 Liberalni Institute www.libinst.cz Czech Republic 91 Libertarian Alliance www.libertarian.co.uk United Kingdom 92 Libertas www.libertas.dk Denmark 93 Liberté Chérie www.liberte-cherie.com France 94 Liberty Ideas www.liberalismus.at Austria 95 Lithuanian Free Market Institute www.freema.org Lithuania 96 Ludwig von Mises Institute Europe www.vonmisesinstitute-europe.org Belgium 97 Ludwig von Mises Institute Poland www.mises.pl Poland 98 Ludwig von Mises Institute Romania www.misesromania.org Romania 99 LVSV www.lvsv.be Brussels

100 M.E.S.A. 10 www.mesa10.sk Slovakia 101 Magna Carta Foundation www.magna-carta.it Italy 102 New Economic School www.economics.ge Georgia 103 New Social Market Economy Foundation www.insm.de Germany 104 Nova Civitas www.novacivitas.org Belgium 105 Nova Res Publica www.novarespublica.org Italy 106 Nurses for Reform www.nursesforreform.com UK 107 Open Europe www.openeurope.org.uk United Kingdom 108 Open Republic Institute www.openrepublic.org Ireland 109 Poder Limitado www.poderlimitado.org Spain 110 Policy Exchange www.policyexchange.org.uk United Kingdom 111 Policy Institute www.policyinstitute.info UK 112 Politeia www.politeia.co.uk United Kingdom 113 Project Empowerment www.project-empowerment.org United Kingdom 114 Ratio Institute www.ratioinstitutet.nu Sweden 115 Reform www.reform.co.uk United Kingdom 116 Riinvest Institute for Development Research www.riinvestinstitute.org Kosovo 117 Romania Think Tank www.thinktankromania.ro Romania 118 RSE (Centre for Social and Economic Research) www.rse.is Iceland 119 Sauvegarde Retraites www.sauvegarde-retraites.org France 120 SME Union www.sme-union.cz Czech Republic 121 Sobieski Institute www.sobieski.org.pl Poland 122 Social Affairs Unit www.socialaffairsunit.org.uk United Kingdom 123 Stiftung Ordnungspolitik www.sop-cep.de Germany 124 Stiftung Marktwirtschaft www.stiftung-marktwirtschaft.de Germany 125 Taxpayers’ Alliance www.taxpayersalliance.com United Kingdom 126 The Copenhagen Institute www.coin.dk Denmark 127 The F.A. Hayek Foundation www.hayek.sk Slovakia 128 Thomas More Institute www.institut-thomas-more.org Belgium 129 Timbro www.timbro.se Sweden 130 Venezie Institute www.venezie.org Italy 131 Veritas www.veritas-iceland.com Iceland 132 Walter Eucken Institut www.eucken.de Germany 133 Work For All www.workforall.org Leuven

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PUBLICATIONS Stockholm Network Weekly Update

ONLINE LIBRARY We have recently launched the Stockholm Network’s online think-tank publications library, our unique one-stop catalogue of European think tank publications. After surveying our members, this initiative was given overwhelming support.We are now seeking all our members’ permission to upload into the library as many of their publications as they would like to see reaching a larger audience, across the Europe and the world. Our aim is to include all languages in the

library, so if publications exist in more than one version, we would like to host it in all available languages.

BOOK FEATURE

of labour, but also less well known works, such as The Theory of Moral Sentiments, the lectures, and the writings on the history of science. Butler therefore provides a comprehensive, but concise, overview of Adam Smith’s intellectual achievements.

Adam Smith – A Primer By Eamonn Butler An authoritative introduction to the life and work of the great economist and philosopher.

Despite his fame, there is still widespread ignorance about the breadth of Adam Smith’s contributions to economics, politics and philosophy. In Adam Smith – A Primer, Eamonn Butler provides an authoritative introduction to the life and work of this ‘founder of economics’. The author examines not only The Wealth of Nations, with its insights on trade and the division

For more information about the library, or if you wish to submit publications, please contact Susie Squire: susie@stockholm-network.org

Whilst earlier writers may have studied economic matters, it is clear that the scope of Smith’s enquiries was remarkable. In relating economic progress to human nature and institutional evolution he provided a completely new understanding of how human society works and was very much a precursor of writers such as Hayek and Popper. Indeed, with poor governance, protectionism and social engineering still commonplace, Smith’s arguments are still highly relevant to policymakers today. Adam Smith – A Primer includes a foreword by Sir Alan Peacock, an introduction by Gavin Kennedy and a commentary by Craig Smith. http://www.iea.org.uk/record.jsp? type=book&ID=414

This weekly e update keeps subscribers up to date on all Stockholm Network member think tank activities including events, announcements and publications as well as featuring insights into news stories from our 3 programme areas.To subscribe, email susie@stockholm-network.org

Books Over the last ten years the Stockholm Network has produced a large number of books, research reports, and compendia of its own and in collaboration with member think tanks and others.These publications have sought to address and clarify many of the big public and social policy issues facing European policymakers and political leaders. If you wish to order a publication please email paulh@stockholm-network.org

Climate of Opinion

A Sick Business £10 Apology for Capitalism £10 Beyond the Borders £10 Coincidence or Crisis? £10 Does the West Know Best? £8 European Dawn £10 Europe needs Saving £10 Flat Tax £10 Intellectual Property Frontiers £5 Impatient for Change £12

Please send news, publications, information on upcoming events, and updates on the work you are doing in the fields of health and welfare to kristian@stockholmnetwork.org for inclusion.

To register for the Stockholm Network Energy and Environment programme’s newsletter, entitled Climate of Opinion, please email helend@stockholm-network.org. Each month, we will focus on a different aspect of energy and environment policy, featuring expert opinion and comment.

European Health Matters

Know I.P. Receive monthly information about the critical I.P. issues in Europe as well as expert analysis and insight into current I.P. debates. Sign-up – www.stockholm network.org/newsletter.php

Stockholm Network Newsletter Want to keep updated with all the Stockholm Network’s latest news, views and events? Sign up for one of our newsletters and receive regular, informed updates in our three programme areas.

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