Imagine suffering for decades in a concentration camp. After being finally liberated, you work and save for five years. Just
when you think there's hope for the future, you're swindled out of your savings and home.
This nightmare has just happened to Albania, a tiny Balkan nation of 3.4 million, where the average annual income is only
$1,000. After 50 years of ferocious Stalinist tyranny that turned the nation into a giant prison, Albania was just beginning to
claw its way back to economic life under the free-market government its capable president, Sali Berisha. Then, disaster
struck.
In a remarkable, bitter irony, the noted Albanian novelist, Ismail Kadere, recently published `The Pyramid,' a brilliant allegory
about Stalinism set in ancient Egypt, where the state keeps the people in servitude by building pyramids. No sooner did this
book appear than Albania went from the pyramid of Stalinism to pyramid schemes of robber capitalism.
One Albanian in three may have lost life savings -and many even homes - to a series of pyramid frauds that could amount to
$3 billion. Furious Albanians have been demonstrating and rioting for the past two months. This week, mobs took over the
southern port of Vlore, where Albanian independence from the Ottoman Empire was proclaimed in 1912.
The pyramid schemes, which were run by Albanians, masqueraded as investment companies that promised to pay up to
300% annual interest. Like chain letters, they worked until momentum was lost. Then, they began to collapse. No one knows
what happened to most of the money.
Last month, the government finally closed down the major pyramids, arresting their principals. But it was too late. Desperate,
hysterical people took to the streets, demanding the pyramids be reopened - or that the government refund their lost
investments. Though President Sali Berisha promised to make good the losses, there is not enough money in threadbare
Albania to do so.
Opposition parties, notably the still-powerful communists and agents of `Sigurimi,' the dreaded Stalinist secret police,
manipulated popular outrage to attack the government, demand its ouster, and promote violence. They accused President
Berisha and his supporters of having been behind the pyramid schemes, or in cahoots with the promoters.
Berisha dismisses all his critics were `reds.,' which is simply not the case. The president lamely explained he had not stopped
the pyramid schemes because he didn't want to interfere in the free market.
I know President Berisha personally. He is a man of courage, keen intelligence, and has a fierce honesty for which Albanians
are renowned. I am sure Berisha was not involved in any of these schemes, though I don't know about other government
officials.
Berisha was so busy trying to rebuild Albania's economy and keep it out of the Third Balkan War that he failed to shut down
the pyramid crooks before they wrecked the economy. A former heart surgeon, Berisha may be forgiven a lack of
understanding of financial frauds. His Ministry of Finance and economic aides have no such excuse - particularly after similar
massive frauds devastated Romania, and caused widespread misery in Bulgaria, Serbia, and Russia.
Instead of scorning non-communist opposition members, the president should have heeded their warnings. Alas, hotheaded
Albanians are not good listeners. Most believe compromise means shooting your opponent between the eyes.
There seems no way the government came climb out of this hole without emergency western financial support. Unless it gets
some fast, it's possible furious, desperate Albanians could evict Berisha's democratic government and restore the communists
to power - a calamity for Albania and a serious blow to the west.
This disaster is a heart-rending example of the perils of lingering socialist mentality, and shows just how far Albanian and other
post-communist nations have to go before they become truly free nations - in their economies as well as in their thinking.
copyright eric margolis 1997
Reprinted with Permission
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Eric Margolis
Syndicated Columnist/Foreign Affairs Analyst
The Toronto Sun
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