RE: Serbian political democracy reverses economic democracy?

[jdoggett <jdoggett@kent.edu>]

David Erda wrote:
to enforce
contracts and to catch fraudsters


I think that this is an important point to consider when viewing the entire 
piece of legislation in Serbia that reduced shares given to workers.  The 
amount of fraud that entered privatization was enormous.  If I understand 
correctly, then for a BMW and some wine, literally, an evaluator of company 
worth would significantly alter figures.  The result would be that the buyers 
got a company worth more than they paid.

Another problem to consider was coercion.  A big problem faced in transition 
was that employees bought shares in a company, the director threatened 
employees who did not sell their shares to him, and the director enriched 
himself at the expense of the employees.  A good question might be: Who 
were/are the directors?  The answer could be that they were old friends of 
Milosovic.

A method for overcoming both of these issues is to reduce self-purchasing in 
favor of an outside buyer.  If the government wants the best bid and wants to 
reduce personal enrichment of one individual (or a small group of 
individuals), then they can do so by eliminating the very structure that 
enables it.  Do I think that this is problematic in the long-run?  Yes.  Do I 
think that this new arrangement opens the doors to other, possibly worse, 
problems?  Yes.

Sincerely,
Joseph Doggett