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July 25th, 2008
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A reminder of the need for a global outlook


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July 23rd, 2008 issue

Conventional wisdom holds that it’s better to be lucky than good. And by any measure, the Czech Republic is a very lucky country these days.

While markets around the world are reeling from the sub-prime mortgage crisis, barely a ripple has been felt here. Local markets have not taken a serious hit, and the crown, if anything, is too strong. Nor have soaring fuel costs cut into transportation, though food prices rise by the week, allegedly because of increased transportation costs.
Conventional wisdom also holds that smart people make their own luck, which is the only way the Czechs’ construction of the expensive IKL oil pipeline in the 1990s can be viewed in hindsight. Because of that lifeline to Western oil supplies, the recent reduction in the flow of oil from Russia barely made a dent in the country’s energy reserves.
But this is no time to sit complacently. That kind of foresight will be needed in the months ahead, as the Czech Republic navigates some treacherous political waters.
Russia’s response to the Czechs signing a radar base treaty with the United States reinforced what the world already knows: Anger the big bear, and you risk serious consequences. Russian defectors, dissidents and journalists routinely end up in jail or dead. When Estonian officials dared to relocate a Russian war memorial last year, their country was bombarded by a vicious three-week cyber-attack. And after the Czechs signed the radar base treaty, Russian President Dmitri Medvedev didn’t even try to hide his reaction, pronouncing himself “extremely upset” and promising “retaliatory steps.”
This is underhanded, immoral, inexcusable — and smart. The days of achieving what you want in the world by brute force are over, as the U.S. misadventure in Iraq has demonstrated. The Russians have cannily built themselves into a dominant economic power, and shown repeatedly that they will exercise that power for their own ends, no matter who it hurts.
What is the lesson in this for the Czech Republic? That no action stands in isolation. This shouldn’t need to be pointed out in a country ravaged by foreign powers for much of the 20th century. But one wonders whether Czech leaders have it in mind when they’re jetting off to cut private deals at the White House, or talking about trading votes to ratify the Lisbon Treaty in exchange for radar base support.
These and other critical issues have global implications. They’re not fodder for internal political squabbles or ego-stroking. Obviously the welfare of this country and its citizens come first, but no serious decision should be made without considering its international ramifications, particularly as they may affect the Czech Republic in the future.
If there’s any discussion along those lines among the political leadership these days, it’s well-hidden.
That said, it’s also important not to be cowed, by the Russians or anyone else. In the case of the radar base, the Russians were briefed about it long ago, invited to visit missile defense sites in the U.S. and even offered a cooperative role in the project. Instead, they chose to cast it as a threat.
Right or wrong, it’s a grim reminder that Central Europe stands once again on a political fault line. The challenge is to walk that line reasonably and intelligently, balancing the country’s needs and obligations with its role in an increasingly interconnected world.


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[01:58 25/07/2008] : The positive remarks in the related article are very pleasing as far as the Czech economy is concerned. However, there are several matters that need immediate and serious consideration. Firstly, President Klaus has ridiculed those who believe the effects of climate change can have lasting and detrimental effects on the world. This issue must be addressed and action taken by the Czech government to not only make people aware of the issues, but what is needed to deal with the future problems. Secondly,the effects of smoking are totally ignored by the Czech government. Where is the anti-smoking advertising? Why are the supposed EU regulations regarding smoking in public places totally ignored or ridiculed? Lastly, the banks need to take a long look at their policy of NOT paying decent interest to those who wish to save money. The greed by banks is extraordinary, and in a short time, the effects of a non-saving nation that is cynical regarding money, spends without care, will swipe Czech citizens in a way that at present cannot be imagined. There are other issues - support of culture, better pay for teachers, a reasonable health system not based on selfishness and government greed. One could go on!
Elinor Morrisby
Sandy Bay, Tasmania, Australia
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