Showing posts with label economics. Show all posts
Showing posts with label economics. Show all posts

2011-06-21

Why did Lithuanians stay quiet during the crisis and why Greeks don’t

Lithuanians in general are not into public protests
Today I was interviewed by a colleague journalist based in Latvia Talis Saule Archdeacon. He is writing a piece about what Greece can learn from the Baltics in dealing with their crisis for AP.

Not sure if I gave him the right perspective from Lithuania but here are some thoughts I shared with him and he seemed quite happy with them.

First of the differences between us and the Greeks is that Lithuanians in general are much less emotional nation than those living in South of Balkan peninsula.

My second insight was that during Soviet times Lithuanians learned to complain about governments in small groups of friends and families, but not in public. During the Soviet period it was dangerous, so till now Lithuanians just complain about their politicians while sitting at home with their friends and family, but not so much publicly. If they do it publicly, then they do it on news portals commenting articles anonymously. So more or less in the same hidden manner.

The other reason which could explain why Lithuanians did not go rallying as much (or almost not at all) as Greeks did and do, could be because we don’t have strong labour unions who could lead people, organize protests etc. Our labour unions are driven by different interests and ambitions.

Also Lithuanians already know what they need to do if things get tough at home – leave. The numbers of those emigrating went up during this crisis. Lithuanians left where they could get jobs and salaries. And this, in my opinion, had a good influence in the short term. These people not just took tension from Lithuanian labour market (even if unemployment became one of the main issues, but still not as big as it could be), but they also financially support their families and relatives who stayed at home. During the first 4 months of this year emigrants transferred 995 mln. Litas to Lithuania – that is 410 mln Litas more than last year during the same period. And it’s almost as much as Lithuania got from EU funds – during the same period EU supported us by 1,2 billion Litas.

I think that in some way being silent enough helped us and our government to deal with this crisis quite well. And on the other hand I agreed with Talis, that yes Greeks are more spoiled than us, our people (at least a larger part of them) still remember difficult Soviet times and not easy first years of Independence (with Russian pressure, including the economical blockade etc.). Lithuanians did not have the opportunity to become accustomed to the good life, like for example the Irish did. We had a very short period of the good life and even then it was not as good as in Ireland. So, I presume, this crisis was less shocking for us.

2011-05-16

The Spoilt Suffer Most (published December 2009)

One topic of discussion regarding the current economic crisis is - who is worst affected?

Some argue that pensioners brought up in the tough Soviet climate are better able to adapt to the present hardships, others that the 40 - 60 year olds who can’t adapt as quickly to the new way of doing things have been the greatest casualties, not just now but over the last 20 years as well.

Deimantė suggests it is the unprepared 25 – 40 generation that is suffering most in this economy. Tell us what you think.


Some say that pensioners, teachers, social workers, librarians or other civil servants suffer from this economical downturn most. But I think that it is my generation – people who are 25 – 40 years old who suffer from it more than others.

A couple of years ago they were living very successful lives. They took loans from the banks and bought cars and flats, and couldn’t imagine a day when their salaries being reduced would ever occur, the prognosis was all just up, up up. They couldn’t imagine that they could lose their jobs, they thought just about the next promotion.

Just imagine a young Lithuanian family, parents in their early 30s, they have two children. They took a loan to buy a flat which cost let say half a million litas several years ago, now worth maybe LTL200,000 (and even worse - nobody wants to buy it anyway). Both parents have cars; they took loans to buy them. They used to go on vocation twice a year – in summer to Turkey and during winter perhaps skiing in Italy or Austria.

And now one of them has lost their job, and for the other a salary reduction of about 20%. It doesn’t sound cool, does it? But this is exactly what is happening in Lithuania nowadays.

Of course people try to find ways out of such difficult situations, some move back to their parents where all four share one room at their parents house, some move to a some smaller flat and rent their apartment to somebody else.

But the thing is that a couple years ago everything was about this generation. They were the main consumers, they were also the ones not afraid to take loans, who weren’t scared to spend and didn’t care much about savings.

They frequented bars and restaurants, spending their money in all the popular wineries, they were the ones attending the theatre, cinema, concerts, sports events, taking dancing and photography classes, taking trips and trying unusual foods, buying clothes, shoes (more than one pair per season like our parents used to do), the latest computers, dishwashers, cosmetics. And yes, they were the ones who helped to create the real estate bubble.

They were sure that things would keep getting better, never worse. Because people of this generation started their working lives in good times, their careers continually improving.

They didn’t live through the tough periods, they were children or teenagers when Lithuania was going through especially difficult times like the Russian blockade, Russian crisis etc. So it wasn’t them who learnt to cope with hardship, it was their parents. They weren’t prepared for this economic crisis, and they never imagined it could be like this.

Hopefully this one lesson will be enough to teach them to understand more about responsibility and how to appreciate values other than just money and work. Maybe the Lithuanian proverb saying ‘don’t be happy when you find something, don’t cry then you lose something’ suits this situation perfectly.

So perhaps that’s why pensioners and the elder generations can cope better, because they are the ones who expect something like this economical downturn to happen. And generation 25-40 were taken suddenly and without any preparation.

This article was published in December 2009 in newspaper LiTnews