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PARTISAN REVIEW
wage-dependent productions requiring low skills will be the first ones to
migrate to the east or southeast, to Bosnia or Ukraine.
The automobile industry was at the center of new industrial begin–
nings. Fiat and Opel invested in Poland, Volkswagen in the Czech and
Slovak republics, Audi, Opel, Suzuki, and Ford in Hungary, and Renault
in Slovenia. Since in these countries goods could be produced more
cheaply than in the West, these firms were able to beat their competi–
tion, control a previously unavailable market, and improve the balance
sheets in their home countries. All of this helped integrate the reform
states into Western industry, although on a rather low level. Their future
economic success will depend on whether they can work their way up
during the next few years. That will depend on whether they will be able
to improve their workers' skills rather than simply raise their wages,
and on the creation of a large number of local small and mid-sized firms
which can supply the big international plants while learning about new
technology and management techniques from them.
The key to each country's economy, however, lies in its infrastructure.
When Opel, for instance, sends its motors
to
Spain or Germany, the
heavy freight cars must navigate a number of hours over secondary, sin–
gle-track rail lines before reaching Wiener Neustadt, Austria, to rejoin
the international rail network.
In
other areas, such transport is even
more onerous. Highways and freight terminals are lacking-in coun–
tries which continue
to
mandate strong border controls, and long wait–
ing lines are the rule. Moreover, the reform states' bureaucrats are
unaware of the importance of a modern infrastructure. Hungary and
Slovenia have already begun to build a rough network of new highways.
But in Poland and in the Czech and Slovak republics some of the most
important transportation arteries consist of just two lanes. State budgets
are tight, and private capital is missing, so their plans have remained in
the drawer for the past ten years.
In
telecommunications things have
moved more quickly, primarily because foreign capital has been invested
in that sector.
It
is a vicious cycle: where infrastructures are inferior, as in eastern
Poland, Hungary or Slovakia, new enterprises rarely get started, even
when experienced workers are available. Therefore, the state needs
to
take the initiative by getting the region into the necessary shape for
industry to move in.
Banking, however, thrives in the reform states.
It
keeps expanding,
although there are large differences among the various locations. Many
people in middle-class cities such as Budapest, Prague, and Warsaw,
have credit cards and money in the stock markets, while the rest of the
