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Letter From Lithuania

This year, I spent my sabbatical leave teaching at Lithuania Christian College in Klaipeda, Lithuania. There I was blessed by the opportunity to witness firsthand the successes, failures, hopes, and frustrations of the citizens of Lithuania, Latvia, and Estonia. Despite the fact that they endure much cultural upheaval, these nations have welcomed the first fruits of free market economic reforms. By all means, these Baltic countries are making spectacular progress from a system of socialist slavery to individual freedom.

In fact, Estonia was recently ranked fourth in the world in terms of its economic freedom by the World Index of Economic Freedom, which is a report compiled by a group of economists headed by James Gwartney and published annually by the Wall Street Journal and the Heritage Foundation. This small Baltic country surpasses most of the free world in providing markets with an established rule of law, as well as an overall stable legal environment. Additionally, Lithuania and Latvia are both following the Estonian example. However, this unregulated economic environment is not without its detractors. The Estonian model of reform is now being criticized by statists in the West for its “undue tax advantages” and “unyielding macroeconomic policies.” Indeed, it is interesting to note that all three Baltic countries have the highest rates of economic growth in Europe. In addition, they all have low inflation and nearly-balanced budgets.

The main problems these growing nations face are the ones created by their socialist oppressors in the Kremlin. The most visible one is the issue of Kaliningrad. This is a Russian enclave completely cut off from the Russian mainland, much as Alaska is cut off from the contiguous 48 states. This geographical separation could create a situation similar to Danzig in the 1930s or West Berlin during the Cold War – with the unpleasant and potentially explosive problem of military transit rights.

Another dilemma is that Kaliningrad has become the crime capital of the Baltic area. The city hosts vast networks of organized crime originating in Moscow, St. Petersburg, and the Caucasus. Kaliningrad, the center of organized crime as well as FSB (the new name for the infamous KGB) activities, has become a nasty thorn that threatens the peace and stability of the whole region.

Historically, Russia has no more of a claim on the former Konigsberg than it does on Paris. Kaliningrad was called Konigsberg until it was occupied by the Soviets in 1944, and Stalin renamed it after his henchman, Soviet "President" Mikhail Kalinin who, among other crimes, signed decrees for deportations and mass executions of Lithuanians, Latvians and Estonians in 1940. Prior to 1944, Konigsberg was a part of Germany and the capital of Prussia.

Konigsberg's geographical location is one of the reasons it was included in the Molotov-Ribbentrop Pact. Germany acquired Danzig (now Gdansk), creating "The Corridor", which stretched to Konigsberg from Germany through Northeastern Poland and into what is now Lithuania, and then to Klaipeda, which the Germans called Memel. All of this territory, except the Kaliningrad enclave, has been turned over to Poland and Lithuania. Only Kaliningrad remains, a rotting, rusting reminder of the Stalinist-Soviet era.

Kaliningrad is the last remaining renamed city surviving from the Stalinist era. For instance, Stalingrad has been renamed Volgograd; Sverdlovsk is now Ekaterinburg; Leningrad has been returned to St. Petersburg; and many other cities have reverted to their pre-Soviet names. Only Kaliningrad remains as a constant reminder of the Stalinist-Soviet era to the people who endured and suffered from it more than anyone else – the Lithuanians, Latvians, Estonians, and Poles.

Following the collapse of the Soviet Union in 1991, Russia was faced with the issue of having to absorb more than a million of its occupation forces from East Germany, as well as other troops from Central and Eastern Europe. Destitute Russia made every effort to keep the troops away from the mainland. Indeed, it is a generally accepted fact that Russia paid Germany to keep discharged Russian military personnel and Russian expatriates in Germany, rather than having to face their return to Russia. In addition, military installations in the Baltic States – the Soviet submarine facilities at Klaipeda, Lithuania and Paldiski, Estonia, and the Soviet Navy bases at Liepojia, Latvia and Tallinn, Estonia – were also evacuated to Kaliningrad. Even the Soviet Space Radar Site at Skrunda, Latvia was relocated in Western Belarus. Today, Kaliningrad hosts the headquarters of the Russian Baltic Fleet, and according to Western intelligence sources, it is also a base for nuclear weapons. It is quite true to say that the enclave, as a whole, hosts a dense military presence.

The current President, Vladimir Putin, does not want to remove the military buildup from Kaliningrad since he considers its use to be two-fold: a military policy tool in dealing with the Balts and Poles, and a valuable bargaining chip with the West. The strategic importance of the Kaliningrad enclave increases immensely while it becomes even more isolated due to a complete economic collapse of its economy. In 1996, Russian President Boris Yeltsin suggested that Poland let Russia have “a bit of highway on its territory” to facilitate Russian military access to Kaliningrad. The proposal was vehemently rejected by Poland, and the Russians backed off.

Now Russia's major target is Lithuania, a country with a considerable Russian population. In fact, Russian anti-West propaganda in Lithuania dominates both Russian and Lithuanian language press and TV, creating an atmosphere of uncertainty and panic amidst many Russians residing here. And in marked contrast to his predecessor Yeltsin, Putin has affirmed Russia’s ties with sootechestvenniki (compatriots) in the Near Abroad, stressing that although ethnic Russians may be scattered among fifteen formerly Soviet republics, they make up a unified people.

According to the propaganda, the Russians feel that the West is threatening their presence in the enclave. I am an ethnic Russian and have spent quite a long time in all three countries. Never have I felt harassed or discriminated against. The attitude towards Russians on behalf of the indigenous peoples of the Baltic states looks absolutely impeccable if compared to the attitude of Algerians, Nigerians, Tanzanians, Zimbabweans and other indigenous peoples of formerly French and British empires towards their past French or British dominators.

According to Sergei Glotov, a member of the Russian Duma, this threat against Russia is manifested by the fact that Poland has doubled its military personnel in its border region since 1994 to 22,000, while Lithuania has concentrated 3,000 troops on its border with the enclave. Imagine! The great and mighty Russia feeling threatened by 3,000 troops!

The fact that the Russians make these statements does not mean they are true. There is a Russian army in the Kaliningrad enclave at least 50 times larger than all Polish and Lithuanian presence combined. And rather than Russia being paranoid about Polish and Lithuanian military hijinks, it is these countries that should be nervous about Russia's presence on their borders. For it was the Soviets who destroyed a prosperous and independent Lithuania in 1940, and committed genocide in the Baltic States and Eastern Poland in proportions that would dwarf the Nazis. Beginning in 1940, when the Soviet occupation of the Baltic states (Estonia, Latvia and Lithuania) began, followed in 1941 by the German occupation, and again in 1944 by the Soviet occupation, over a third of Lithuanians, a fourth of Latvians, and a fifth of the Estonian population was forced to leave their homeland by the Soviet and German occupation authorities. Interestingly, the crimes of the German National Socialist regime have been condemned internationally while the horrendous crimes of the Soviet Socialist regime have not been similarly denounced. In fact, they are even praised in Moscow as the “liberation” of the Balts from the “bourgeoisie” first and the Germans second.

In June 1940, Stalin carried out an open and contemptuous aggression against Estonia, Latvia and Lithuania based upon a secret agreement with Nazi Germany. His regime occupied and mutilated three independent and proud countries in violation of all provisions of international law while mocking the existing “peacekeeping” system of the League of Nations. With the blessings of Roosevelt and Churchill, the Soviets completely destroyed the constitutional order, national institutions, and prosperous economies of the Baltic states. An occupation army, along with the NKVD (predecessor of the infamous KGB), carried out genocide, numerous war crimes, and various other crimes against civilians. Along the way, they destroyed the institution of private property – the basis of any civilized society – and deliberately annihilated the national cultures of all three countries.

With the goal of Russification of the Baltic states, Stalin and his successors – Kruschev and Brezhnev – changed the ethnic make-up of the Baltic states via massive and forced migration of Russians, Ukrainians and other Soviet citizens into Latvia, Lithuania and Estonia, in order to destroy the cultural homogeneity of these nations. Today, one can witness the ethnic quandary left behind by Soviet socialism – the integration of Russian and other non-indigenous migrants to the Baltic countries to desegregate their populations and turn them into minorities in their own homeland.

Those individuals that were not integrated were exterminated. Mass executions and deportations to Siberia resulted in at least 1.5 million Poles and Lithuanians being murdered between 1939 and 1956. This massive scale of Soviet genocide, in both countries, is a story practically unknown in the West. In 1939, 3.1 million people lived in Lithuania. By 1952, only 2.3 million remained. Every third Lithuanian was either murdered by the NKVD or German SS thugs, or ended up perishing in a dreadful Gulag. Poland lost one in every six adults.

In its recent statement, the Riigikogu – Estonian Parliament – was the first authoritative institution to declare “the Soviet Union's communist regime which committed these crimes, and the Soviet Union's organizations which implemented such regimes as the NKVD, the NKGB, the KGB, and any tribunals or special meetings, as well as death squads, peoples' defense battalions, and their activities" to be criminal. The Riigikogu emphasizes that "responsibility for the crimes against humanity, and the war crimes carried out in Estonia by the repressive organs of the Soviet Union in Estonia lies with the ruling Communist Party of the Soviet Union and its organization, the Estonian Communist Party."

In declaring the communist occupation regime's institutions and organizations to be criminal, the Riigikogu is standing tall among other parliaments and international organizations. Moreover, some members of the Lithuanian and Latvian parliaments are trying to introduce similar resolutions.

The crimes of the Soviets in the Baltic states were but part of the oppressive activities carried out by socialist totalitarian regimes in the twentieth century. The danger of repetitions of such crimes has not disappeared. Although the Soviet Union exists no more, Russia has declared itself the heir of the USSR, using its state symbols: the anthem and Communist Party holidays. Mr. Putin declared, as a state holiday, the restoration of Day of the Soviet Army – February 23. On this day in 1918, Lenin and Trotsky signed a decree creating the Red Army. Russia also inherited the Soviet KGB, which it renamed the FSB. They also inherited the Army, Navy, and Air Force with over 7,000 nuclear weapons; a huge and illegal chemical and biological arsenal; and a military with at least 1.5 million soldiers that it has ruthlessly used in Turkmenistan, Georgia, and Moldova, as well as against its own citizens in Chechnya.

President Putin, whose professional life revolved around the KGB where he was a career spy, has definitely made the restoration of Russia's superpower status a priority, as he has so stated on several occasions. Under President Putin's leadership, any hopes for freedom and prosperity in Russia are being betrayed as he has effectively wiped out all voices of dissent on national TV, and is steadily moving towards authoritarian rule in other spheres. At one lavish Kremlin reception, he raised a toast to Stalin, and referred to the people of Chechnya as "dark-skinned terrorists who should be prosecuted everywhere, even in latrines and killed there." Putin, using the words of Booker T. Washington, is a "typical problem profiteer" – he thrives on problems whether real, imaginary or fabricated. The war in Chechnya, the bombing of apartments in Moscow and Southern Russia, and the Kaliningrad issue give him excuse to crack down on the freedom of speech, harass his political opponents, and increase the power of the state as well as his own. Yet unlike his predecessors, Messrs. Gorbachev and Yeltsin, he understands that the only way to restore the superpower status of Russia is to rebuild it economically.

Under the guidance of market reformers, like Andrey Illarionov, his chief economic advisor, the Putin government introduced a flat 13% tax on income to replace a sophisticated and confiscatory tax system that emerged under President Yeltsin. Another economic reformer, Minister for Economic Development German Gref, proposed some small business-friendly reforms which should reduce tax and regulatory burdens for small businesses.

In foreign policy, however, the Kremlin continues to treat formerly Soviet-occupied states (including the Baltic states) as "the Near Abroad." The Kremlin even embraced another Stalin fan – the infamous Byelorussian dictator Aleksandr Lukashenko – and keeps its troops in Belarus, propping up and securing his regime. The Russian government continues to manipulate gas and oil supplies to Ukraine, Moldova, Georgia, and other former republics to ensure pro-Russian policies from the Commonwealth of Independent States, which it dominates.

The amount and intensity of hatred by the Russian ruling elite towards individualism associated with the West is comparable only to that of the Islamic fundamentalists. Thus, it was not surprising to learn that during the "idyllic" period in U.S.-Russian relations – during the Clinton Administration – Russian espionage activities in the United States practically doubled.

All considered, maybe the best alternative for Kaliningrad is to be turned into the Hong Kong of the Baltic region, providing its residents with the same rights and liberties as the free people of Hong Kong. Some others suggest buying Kaliningrad from Russia or even declaring it an independent state. On the contrary, none of these options would be accepted by Russia today. Even the "Hongkongization" of Kaliningrad is highly unlikely; it would be difficult to explain to Russians on the mainland why some of their fellow citizens are enjoying rights and freedoms unheard of elsewhere in Russia.

In contrast, if the status quo is the fate of Kaliningrad, then it will remain much as it is now: a haven for crime, espionage, idle military, and a rusting fleet. For it is clear that Russia currently can't afford to even maintain Kaliningrad, much less improve it.

July 10, 2002

Yuri Maltsev [send him mail] is professor of economics at Carthage College and senior fellow at the Ludwig von Mises Institute.