Let’s Deport Poor People! A Modest Proposal for Latvia’s Unemployment Problem (with apologies to Jonathan Swift)

By Marshall Auerback

In 1729, Jonathan Swift wrote an essay — “A Modest Proposal” — suggesting that the impoverished Irish ease their economic troubles by selling children as food for rich gentlemen and ladies. In that spirit, we would like to assist all governments who claim to be broke and therefore cannot deal with the persistent problem of unemployment. Latvia clearly shows the way.
On June 2009, the newly appointed Latvian Prime Minister, Valdis Dombrovskis made a national public radio address and said that his country had to accept major cuts in the budget because they would allow the country to receive the next installment of its IMF/European Union bail-out loans. He said the country was faced with looming “national bankruptcy” and then proceeded to ensure the validity of that claim, by implementing the economic equivalent of carpet bombing, in effect turning the Baltic republic into an industrial wasteland via the most virulent form of neo-liberal economics.

Having broken free from the chains of the former Soviet Empire, Latvia promptly surrendered its currency sovereignty by pegging its currency against the Euro. What this means it that it has to use monetary policy to manage the peg and the domestic economy has to shrink if there is are downward pressures on the local currency emerging in the foreign exchange rates. So instead of allowing the currency to make the adjustments necessary, the Latvian government handled the “implied depreciation” by devastating the domestic economy (public sector pay has been cut by 40 per cent over the last year, whilst the economy has contracted by almost a third).

9 responses to “Let’s Deport Poor People! A Modest Proposal for Latvia’s Unemployment Problem (with apologies to Jonathan Swift)

  1. Not so far from reality.Latvia have had a declining population since 1990. Since entering EU they have had net emigration. Probably a drain of people in attractive age and skills. Latvia is among the top rate in suicide. When the ten eastern European and former soviet block countries should enter EU there was referendums in a number of countries. In general the interest to vote in the referendums was poor, in man y countries they even had problems to get enough people to vote so the referendum was legally binding. The interest to vote was highest among young people, in many places due to the opportunity to leave/emigrate that the EU membership entailed. Economic/political systems that make the countries future want to leave is seriously flawed.P.S.While Greece is down on knock out, the referee is still counting, and the rest of the piigs is hanging on the ropes EU is filling the ranks from the farm teams.The European Commission on Wednesday recommended admitting Estonia to the euro area on January 1, 2011

  2. Love it."Ratio of money to citizens" is a great way to view the issue. I've never seen it stated quite that way but I like it.

  3. And you don't think that something along the lines of Swift's solution hasn't been operant in the West for a few decades now? What to make, then, of the unceasing advocacy of elitist, white, feminist academics and professionals for government funded abortion services for the poor, particularly blacks and Hispanics? Having concluded that children are something to be despised and arrogant enough to envision their own outlook as oh so much better informed, one can see little difference in what they envision and what Swift had. Could it be that some of these folks even sell books and pass themselves off as economists? I'll never tell. Andrei Vyshinsky

  4. How do we stop this madness of our governments? Current decision makers simply are not listening.

  5. A neo-liberal ideological failure.The incorporation of Eastern Europe descending from the Soviet block in to EU is in large a great economic failure of EU. If one compare to post WWII, Marshall plan and US incorporating the former European powers as US vassals EU have failed miserably. One can say many things about cold war, imperialism, and so on but rebuilding, with US guidance and currency, of war ravaged Western Europe to modern democratic states was in large great success for the common people in Europe and the era was duly successful for the Americans. In the same amount of time that Eastern Europe have been incorporated in western Europe no less than a economic miracle was achieved in the same amount of time in post war western Europe when it comes to infrastructure and common prosperity.Same thing can be said about US present adventures in Iraq and Central Asia (trying to incorporate them in the "free world" and keep them away from China and Russia influence), it is not primarily a military failure and havoc in some of the sphere but an neo-liberal ideological failure bee it US-army or bloomy colorful "revolutions".

  6. Oh, Marshall! Not posting comments that express views with which you disagree even though they employ no off-color language or identifiable ad hominem? What's "progressive" about that, pray tell?Andrei Vyshinsky

  7. Andrei,First of all, it's not my blog and your comments don't come to me. Second, you've got your comments published, so what on earth are you going on about? Reasonable people can disagree on the difficult issue of abortion. I don't think it's particularly germane to the conversation at hand, but you've got your platform, so you can stop whining now about not being heard.

  8. Marshall,Oh, please, "whining". One posts into a dead silence here that continues on for days and its not reasonable to suspect that one is being censored? And as to relevance, if you don't want commentators doing riffs on your Swift allusion and its baby killing, don't lead with your chin, eh?Andrei Vyshinsky

  9. Andrei – not sure whether it was an attempt at humour, but your contribution came across as a mean-spirited dig. This blog is about economics, not about the moral issue of abortion; other blogs might well gladly embrace your theories. Also, the blog is very open-minded (read how patient many of the bloggers are with some of the more inane/demanding commenters) so it was silly to assume censorship.To your actual theory, it seems that you are seizing upon individual feminists in the 70s being less inclined to have their own families than prior generations, and inferring that the feminist campaign to (ostensibly) universalise access to abortion therefore MUST have been motivated by some nefarious eugenics campaign. Sounds pretty whacko to me, but if you can back this up at all I'd be interested to hear it.Best wishesPeteD