(Chinese proverb).

Introduction: The bet is made

I can still remember those moments, although I was only three and a half back then. I remember the general effusion and optimism following the great fear that had captured the imagination of every Romanian for a couple of days at the end of December.

My father, a genetics researcher at the local Fruit Tree Institute, had guarded the premises, with an old pistol, for most of the period of the Revolution. He did not fear the terrorists, but rather the maddened crowds that might have decided to pillage the vast orchards of the Institute. My mother, a doctor, stayed home taking care of her two children. It was a period of general paranoia: everybody suspected everybody.

And then, on Christmas Day 1989, everything ended: Ceausescu, the Dictator, was executed and we, the People, were liberated. It was as if a huge iron cast had been lifted from everybody’s legs: we were free and rapidly heading for democracy and capitalism. Or, at least, that’s what everybody thought.

In January 1990, political scientist Silviu Brucan issued a prophecy that would haunt Romania up to our days: “To learn democracy and capitalism, Romanians will need twenty years”. This was a prophecy that both perplexed and enraged a society that was just starting to learn the tricks and trades of capitalism. Over the years, the obsession of the two decade deadline would be a recurrent theme of Romanian society. And would mark the beginning of a subconscious bet our country had made with itself: we need twenty years to become a real, consolidated democracy. But could Romania actually win this bet?

Scene one: Help comes from abroad

In June 1990, my father went abroad for the first time, to attend an international conference in Italy. What he saw there shocked him: a rich, consolidated society, where everybody knew his place and did his job right. When he came back, he brought us, his children, a couple of kilos of bananas (which were still a difficult find in the Romania of those times) and a comics magazine, with all the Disney characters.

The West was starting to arrive to Romania, although president Iliescu’s policy was still nationalistic and somehow anti-western, forbidding much of the needed privatization of the large, state-owned companies (he used to promote the slogan “We will not sell our country to strangers”). Still, western acculturation was inevitable for a population that had waited for the Americans to come and save them from the Soviets for the past fifty years. American films, music and food were quickly adopted, and those really rich were able to buy themselves western cars and TVs.

Western aids for Romanian maternities and asylums became a common thing and many Western Europeans, impressed by the situation in our country, came over and adopted children who had no families.

Consumerism was the word of the day: people bought everything they could get their hands on. I remember the purchase of the first family TV, which had cost a small fortune and was regarded as a national holiday by my parents. The smarter of the Romanians were already speculating on this: they would go to Germany for TVs and other electronic equipment, to Poland for clothes and to Turkey for jewellery. Many of those that did this back then are some of the city’s rich nowadays. Others could not keep the pace and soon went bankrupt. Almost every decent Romanian dreamt in those days to have a business of his own. I remember that even my father was animated by such an ideal: he went, with the family’s savings, to Hungary, to buy gold and resell it in Romania. He did so a couple of times until he had enough money to buy a van, with which he transported people from one place to another. He made a decent amount of money which he decided to invest, afterwards, in a pyramid game, CARITAS, which promised everyone eight times the sum they deposited, in just a couple of months.

Scene two: The smart guys and the suckers

The beginning of the nineties was a very wild period in Romania, and this could be seen from the conflicting opinions at the time: some feared the country was heading for anarchy, others that it was marching towards another period of dictatorship. Economically, everyone tried to manage for himself, but soon one could see that some were more equal than others. Former members of the Securitate, the Romanian secret service of the communist period, and the former communist dignitaries held the edge over the rest of the population. Some became incredibly rich incredibly fast. Factories were closed down and either bought for nothing or dismantled and sold piece by piece. Others profited from the general state of confusion and misappropriated many of Ceausescu’s monetary funds, diverting them to their own accounts. Still, others managed to build businesses on a more solid base, creating local brands of genuine value.

This was also a period of general naivety, with people investing foolishly in games like CARITAS or in banks that offered huge interest rates. “Get rich or die trying”, this might very well had been the motto of the day. When CARITAS fell, the country was threatened with massive popular unrest. Many had invested in this game, and the sensation that they had been fooled was very stringent. Wild tales of political involvement in the scheme made the Romanians feel even more that the country started to be split into two: the smart guys and the suckers.

By the 1996 elections, things were apparently starting to settle down: a class of the newly rich was already coagulating, the country had become more stable and had already started to consider access to NATO and the European Union and, foremost, the political elections of the year swept away the final concern, both of foreign investors and of the local intelligentsia, over the democratization of the country. The change of power was made in a peaceful manner.

Scene three: Hope and despair

The year 1996 was filled with hope for everyone. Everybody saw the new government as one that might finally save Romania and end the painful economic transition period. There will be no more sacrifices, the new president promised, and many people were ready to believe him.

And things apparently went better, for some time. Romania opened itself towards the West like never before. Foreign investors were allowed to come to the country and the privatization process accelerated. Old, state-owned enterprises, which could not keep pace with the private sector, were sold for as little as a couple of thousands of dollars, and the bureaucratic system for registering new firms was also simplified.

I remember well the first days when Jean Valvis came over to our town to buy the old Dorna dairy factory. He was a Swiss investor who was determined to make the factory an efficient one and produce items at a level of quality similar to that of the western countries. There was much hope, both from his part and from the part of the locals, who saw his coming as a chance of reviving our old, little town.

But things did not turn out as expected. The investor came with the best of intentions but did not take into consideration one thing: Romanian “customs”. The general directors, as well as the local workers, stole as much as possible from the company: the directors would take the funds and the workers would steal cheese manufactured there and resell it on the local market, at very low prices. Soon, the entire cheese market was collapsing: Dorna from the heavy financial losses and the other companies from not being able to keep up with the low prices practised on the market. In a couple of years, Valvis sold the company and moved out of town.

By 1999, hope had turned into despair. The discussions about no more sacrifices had been proven cheap demagogy. My father’s Fruit Tree Institute had been closed down and for some time he had been forced to look for work. Finally, he resumed his former job, as the Institute was bought by its ancient director, who had purposely bankrupted it to buy it for himself from the state at a low price.

Dark times loomed ahead. And they were becoming even darker: in May 2000, FNI, an investment fund attracting over 300,000 investors from all over the country, collapsed. It was a second CARITAS and it proved that the Romanians had learned almost nothing from the mistakes of the past.

Near the elections of 2000, the president, Emil Constantinescu, declared on press that he had been defeated by the system and that he would not run for a second term. The road was clear for the old, crypto-communist social democrats to come back to power.

Scene four: back to basics

The year 2000 was seen by many as a return back in time, to ten years before. The FNI scheme, the miners’ protests and the return of the old president Iliescu to power were seen as a setback. Still, soon enough, things started to look different.

A solid class of rich entrepreneurs had already been created, some owning large media companies that fought vigorously for the people’s attention. Actually, one might say that the year 2000 marks a sort of deadline for becoming extremely rich: those that had made it by this time managed to guard and enhance their fortunes. Few others managed to enter the top positions after this year.

The country’s economy started to stabilize: banks, which had been going bankrupt all throughout the nineties, became more and more reliable. Romania entered NATO and was preparing for EU accession. More and more foreign investors were coming over, attracted by the low prices and by the evermore improving conditions.

Still, the civil society started to accuse the country’s government of too much “stability”. Stories of abuses, of media control and of high corruption became more and more common. In the far-away counties, “local barons”, as they were named by the press, started to control every aspect of local life: they decided who invested where and asked for a form of “protection taxes” (bribes) from those that wanted to start off large scale businesses in the area.

Travel requirements for the European Schengen area became more and more lax, and this provoked a large exodus of Romanians to countries like Italy, Spain or France. More than a million people left the country in just a couple of years, and many never returned. The exodus continues up to our days, but if at first those that went abroad were mostly unskilled workers, nowadays there is a massive brain drain, of doctors, pharmacists and engineers.

Those that were rich became even richer during the period, and soon Romania became a semi-oligarchic state, where a few controlled most of the national assets. Privatization continued, and by the end of the term, in 2004, almost all large-scale Romanian companies were sold to foreign companies. The biggest scandal was related to the privatization of the state-owned oil company Petrom, but the selling of other companies were also linked to allegations of corruption.

Romanian economy was starting to grow and living conditions were also better, but the general impression was still that of disappointment, as the government was seen as an extremely corrupt institution.

Scene five: the Two Romanias

When the social democrats lost the 2004 elections, their president at the time, Adrian Nastase, talked about the existence of two Romanias: the Romania of the young, living in big cities and working in the private sector, which lived in conditions similar to those in the West and the old, rural Romania, having little or no income, dependent on the state system.

This was cynical but true. For years, Romania had been torn into two, between those that, encouraged by the years of general economic growth, became employers of multinational companies and adopted western customs of living and the rest of the country, made up of those socially assisted and of the oversized public system. The first were in charge with the acceleration, the others with the breaks. But the breaks were more powerful than the acceleration, and this made the country flounder many times.

The liberals that came to power in the 2004 elections tried to change some of this. Their first measure was to impose a flat tax of 16%, some of the lowest in all of Europe, in order to reduce the underground economy and to bring money to the state budget. Aided by Romania’s accession to the European Union and by the global economic bubble, as well as by the large amounts of money sent to the country by those working abroad, they imposed an overall trend of economic prosperity, despite the country’s political instability, caused by the constant arguments between prime minister Tariceanu and president Basescu.

This is a period of general economic effusion but also of great budgetary expenditures, which make the country vulnerable for the economic crisis which announced itself as imminent. A crisis from which both Romanias would have a great deal to suffer.

Scene six: The end of the bet

And here we are: 2010, Romania. The much feared and prophesied twenty years have passed and our country still seems to be a long way from discovering both democracy and capitalism. So, is Romania’s bet with itself lost? Yes and no.

Romanian society has certainly gone a long way from the naïve consumers of the early nineties, and so has the national business class. Access to the top group of the rich is nowadays ever more difficult and local businesses are based on ever more solid bases. Foreign investment is not only allowed, but also encouraged, and with some of the lowest production prices in the EU, Romania has become, in the past years, a favourite destination for large multinational enterprises.

One of the major issues with which the country is confronted is the massive brain drain of Romanian specialists to western countries, which threatens to turn the country into a second-hand nation, useful only for the production of goods to be consumed by the western societies.

Another important shift in the last two decades of Romania’s history is the change of emphasis, from social relationships (which were the most sought-after quality during the nineties, when knowing the right person meant actual success) to financial power (the major quality in any capitalist country).

And how have these changes affected the common Romanians? My father, after twenty years of fighting the economic transition, has finally retired and is awaiting a pension that is little more than 250 Euros. My sister, after eleven years of theory and practice in the Romanian hospitals, has decided to quit the country for France, where doctors are far more appreciated than in Romania. My mother has also retired and has set up a private clinic with other doctors from the town, and things are working pretty well for a town as small as ours. As for me, I have come to Bucharest to study and am soon preparing to enter in the work-field myself, ready to continue Romania’s long journey towards the light.

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