Yugoslavia was a land of plenty. Life in Yugoslavia was better. There was no unemployment. They build housing, hospitals, and schools. Young people got a job immediately. There was brotherhood and unity between all Yugoslav nations. It seems most Slovenians (especially those that have never actually lived in the Socialist Federal Republic of Yugoslavia) have only nice memories of the former country. But in Slovenia myths and fairy tales do not exist only in books but also in society and the minds of a “select few” (or their descendants) that were chosen by the former regime. However, are any of the things that they want people to take as gospel actually true?
The fact is that Slovenians were poorer in Yugoslavia than they are today. A list which was posted on Twitter by Dr Božo Predalič shows how much more citizens of former Yugoslavia had to work compared to citizens of Western democracies. For a kilogram of bread, a Yugoslav worker had to work for 29 minutes while in Switzerland he could have earned that in 13 minutes and in Italy in 10 minutes. But how had it come to this?
Economic (under)development after the second world war
Economic development after the second world war was based on state, cooperative, and private property. The war was followed by nationalisation – the main industries were nationalised through confiscation or sequestration. Economic governance was taken over by the state apparatus, and companies operated in accordance with state budget regulations. The economy developed under five-year plans. During the first five-year period, the country became electrified and industrialised. The reconstruction of territory which had been destroyed during the war began as well – it was based on voluntary work. The first important economic measure of the new authorities was the agrarian reform. With the reform, land was transferred to a land fund, and then half of it was divided according to the principle of “land to those who cultivate it”, while half of it was kept by the state. What happened was a so-called “patriotic nationalisation” of the land of big landowners, the church, and banks.
Immediately after the war, general agricultural cooperatives were formed as well. They were established in almost every village, and after 1948 a forced collectivisation that followed the Soviet model started to be carried out, and farmers resisted.
After the Informbiro dispute, Yugoslavia entered a period of self-management and decentralisation. Works councils were appearing in companies. On 27 June 1950, the People’s Assembly of the Federative People’s Republic of Yugoslavia legislated self-management. The state stopped closely managing companies, retaining only a “guiding” role. The new political direction was followed by strong propaganda and ideological pressure. Due to an economy that was based on state property, a general decline occurred in the 1960s, both in industrial production and worker salaries, and the number of unemployed increased.
Decline in value of social democracy
In the 1960s, the standard of living in Yugoslavia began to improve. Numerous Western influences began to appear. Slovenian households were introduced to washing machines, vacuum cleaners, televisions, and eventually cars. Numerous flats and holiday homes were built, and tourism was developing. Nevertheless, life in Yugoslavia was still far behind life in Western democracies. Short shopping trips across the border became part of everyday life. Social inequalities were increasing and a middle class was beginning to form which prevailed over the working and rural classes. This was reflected in protests and demonstrations. In 1968, at a time of increasing stratification, students in Yugoslavia revolted, demanding true self-management and more rights.
The initial increase and growth in the standard of living had mainly been based on an excessive debt. The first signs heralding the subsequent economic crisis were beginning to appear – the inflation that had been kept down artificially was rising, and unresolved national conflicts were smouldering under the surface after they had simply been swept under the carpet for decades. The new policy was for companies to cooperate, not compete, and led to higher prices on the domestic market while abroad Slovenian companies became increasingly uncompetitive.
“Even after Tito – Tito”
Thus, the 1980s were marked by the economic crisis, a general inflation, and a fall in the standard of living. The inflation in 1980 was at 45 percent, but eight years later it already reached 350 percent and was still rising. On December 1989, it had already reached an unbelievable 2,700 percent. Communist Yugoslavia could no longer keep paying off the debts that it had accumulated while creating a pseudo social democracy. But the ruling Communist Party kept throwing dust into its own (and the population’s) eyes. It was “solving” the economic crisis by accumulating even more debt abroad. Foreign creditors forced the government into accepting some economic measures, but those only resulted in general discontent and strikes in the country.
The standard of living plunged. Well-known measures were taken, for example a system of “odd–even rationing” which limited driving based on numbers on licence plates. The widespread scarcity was evident on store shelves – it was impossible to buy coffee, tropical fruits, and washing powder. Cracks in the socialist system and in the brotherhood between Yugoslav nations widened, and it all ended bloodily in the 1990s.