Far from being wedded to each other as claimed, capitalism and democracy are often on a collision course. US rulers find electoral democracy useful when it helps to destabilize one-party socialism or derail a reformist movement or when it serves as a legitimating cloak for capitalist restoration. But when democracy starts to successfully advance egalitarian economic reforms, when it becomes a barrier to an untrammeled capitalism, then it must be undone or diluted in some way.
A striking example is Yugoslavia. Multi-ethnic Yugoslavia was once a regional industrial success, with a fairly high economic growth rate, free medical care, a literacy rate over 90 percent, and a relatively equitable and prosperous economic life for its various peoples. Despite a considerable amount of private foreign investment, the Yugoslav economy was still mostly publicly owned, with a large public sector that was out of line with the march toward free market Third Worldization.
That US leaders planned to dismember Yugoslavia is not a matter of speculation but of public record. As early as 1984, the Reagan administration issued US National Security Decision Directive 133: United States Policy Towards Yugoslavia, stamped “secret sensitive.” It followed an earlier directive that called for a “quiet revolution” to overthrow communist governments while “reintegrating the countries of Eastern Europe into the orbit of the World market” (that is, the capitalist world market). The economic “reforms” pressed upon Yugoslavia by the IMF and other foreign creditors mandated that all socially owned firms and all worker-managed production units be transformed into private corporate enterprises.1 To best accomplish this goal, Yugoslavia itself had to be dismembered.
There came years of US-led boycott, embargo, and wars of secession with US-financed secessionist forces leading various republics to break away from Yugoslavia. In February 1999, western officials made their dedication to privatization perfectly clear, issuing an ultimatum stating: “The economy of Kosovo [a major province of Serbia] shall function in accordance with free market principles.” All matters of trade and corporate ownership were to be left to the private market.2
Then in March–June 1999 came eleven weeks of round-the-clock US aerial attacks against Serbia, Kosovo, and Montenegro, leaving the Yugoslav economy in ruins. The private corporate sites within Yugoslavia were left untouched by the attackers. The bombs fell only on state-owned or worker-controlled factories, enterprises, auto plants, construction firms, municipal power stations and other public utilities, government radio and television stations, depots, ports, railroads, bridges, water supply systems, hotels, housing projects, hospitals, schools, and hundreds of other nonmilitary state-owned targets—in what amounted to privatization by bombing.
In addition, there were some 8,500 civilian casualties, and hundreds of thousands of tons of highly toxic chemicals spewed into the air, soil, and water, including depleted uranium in the Danube River, a source of drinking water for millions of people.3 The US bombing of Yugoslavia was a war crime that went unpunished and almost unnoticed. As George Kenney, a former State Department official under the elder Bush administration, commented, “Dropping cluster bombs on highly populated urban areas doesn’t result in accidental fatalities. It is purposeful terror bombing.”4
The American public was smothered with stories, many of them fabricated, demonizing the Serbian people and their elected leaders as the perpetrators of mass rape and “genocide.”5 More likely, the Serbs were targeted because they were the largest ethnic group in the federation and the most committed to keeping the country together, with a working class that was most firmly socialist. Yugoslavia’s democratically elected president, Slobodan Milošević, who presided over a coalition government, was portrayed as a bloodthirsty tyrant and “Serbian nationalist.” In fact, Milošević and his wife, Mira Marković, herself an active player in Yugoslav national politics, had long argued for multi-ethnic unity and against nationalistic supremacy of any stripe (including Serbian nationalism).6
All sides in the secessionist wars committed atrocities, but incidents of Croat and Muslim war crimes against the Serbs rarely made it into the US press, and when they did they were accorded minimal mention.7 John Ranz, chair of Survivors of the Buchenwald Concentration Camp, USA, asked where were the TV cameras when hundreds of Serbs were slaughtered by Muslims near Srebrenica?8
The Serbs were charged with “ethnic cleansing.” But any number of Western sources including the EU, various UN commissions, Western security agencies, the German Foreign Ministry, UN generals, former State Department officials, Spanish and FBI forensic teams were unable to find evidence of genocide. Nor did the international tribunal set up by the NATO powers succeed in showing Milošević guilty of such a charge.9
In 2000, at the initiative of the European Union, a Stability Pact for Southeastern Europe was set up to create (in its own words) “vibrant market economies” in the Balkans. The Overseas Private Investment Corporation inaugurated a fund “to provide capital for new business development, expansion and privatization.”10 Meanwhile, the US Agency for International Development announced the undertaking of “assistance programs to . .. advance Montenegro toward a free market economy.”11
In April 2001, according to the London Financial Times, the newly installed “pro-West” rulers of Yugoslavia (by now reduced to Serbia and Montenegro), beneficiaries of millions of dollars in US electoral funds, launched “a comprehensive privatization program as part of economic reforms introduced following the overthrow of former president Slobodan Milošević.” This included the sale of more than 7,000 publicly owned companies to private investors.12
The once viable and fairly prosperous social democracy of Yugoslavia was now broken into a cluster of right-wing mini-republics in which everything was privatized and deregulated. Living standards dropped drastically; the public infrastructure was reduced to shambles; unemployment and poverty skyrocketed; and a new class of rich investors strutted upon the political stage, including shady coteries of Kosovar Albanians who, as reported by Interpol, held “the largest share of the heroin market” in Switzerland, Austria, Belgium, Germany, Hungary, and several other countries.13
All sorts of US liberals and other “leftists,” who later opposed the war against a dictator and torturer like Saddam Hussein in Iraq, supported the war against a social democracy like Yugoslavia. They stood shoulder to shoulder with the White House, NATO, the CIA, the Pentagon, the IMF, and the mainstream media, convinced that they were opposing the demonic Serbs in a “humanitarian” war—a war that brought the restoration of free market corporate capitalism.14