From Bureaucratic Socialism to Peripheral Capitalism

The importance of the student protests owes not only to Albania’s particular social formation, but also the crisis from which it emerged. The country’s peripheral capitalism built on the ruins of the previous bureaucratic socialism, but also partly inherited its productive infrastructure and social composition. Most importantly, in this peripheral capitalism there is no clear functional dividing line between the state bureaucracy and the emerging bourgeoisie.

Although heavily tainted by bureaucratic and despotic distortions, until the mid-1970s at least Albania’s socialism had a propulsive rhythm. It contributed to the partial industrialization and urbanization of a very backward country, to the emancipation of women and the spread of education and health care to the remotest parts of the country. It created a substantial working class almost out of nothing, on the back of capital accumulation from the collectivized peasantry and the grants from the Soviet Union (until 1961) and, most importantly, the People’s Republic of China (until 1976).

The stagnation of the 1980s and the deepening economic crises — followed by the very weak opening-up of the regime after the death of Enver Hoxha, president from 1944 to 1985 — led to growing discontent especially amongst the working class and intelligentsia. In 1990, students, as the most active part of the intelligentsia, took the initiative and started mass demonstrations against the socialist bureaucracy. But it was only after the working class of the main cities entered the scene in 1991 — by joining the students’ demonstrations and calling a general strike — that the bureaucracy gave in and accepted its political dismantlement and a transition to what at that time was called a market economy.

If the highest echelons of the socialist bureaucracy left the scene, this was not the case with its middle cadres. Most of them reemerged as the new political bureaucracy in the context of a newly established capitalist system. They were the main figures of the newly established political parties. More importantly, some of them — in concordance with the state apparatuses — were transformed into the new bourgeoisie. This was the most important and secure way of building a bourgeoisie, the others being capital accumulation through organized crime and economic entrepreneurship in its classical form (from small to big businesses).

The process of capital accumulation was triggered by mass privatizations. During the Stalinist-type of socialism, every economic activity or enterprise — to the smallest ones — was controlled by the state. In the 1990s all of the small and medium state enterprises were privatized. Except for some mines and the oil sector, the entire industrial base of the economy was not only privatized, but almost wiped out. Lamenting the outdated technology and lacking the necessary capital to regenerate them, the new owners just dismantled the factories, selling them off piece by piece. Ironically enough, what started as a working-class struggle against the bureaucracy soon produced mass unemployment.

In order to understand the level of deindustrialization, one could look at the number of industrial workers. In 1990 there were 339,000 industrial workers, while in 2004 there were only 79,000 In 2016, only 10 percent of employees worked in industry, while more than 40 percent still work in an almost precapitalist agriculture (the majority of the peasants are neither farmers, nor rural proletarians, but till their small plots of land using premodern tools according to the principles of subsistence agriculture). Below them there is an enormous mass of urban plebeians, a myriad of small vendors, permanent unemployed, precarious workers, self-employed, workers in very small businesses (one-third of workers are employed in enterprises which employ 1–4 people), etc.

Work dispersion has led to the obliteration of almost any kind of trade unionism. In 1991, 93 percent of the urban workforce was part of a trade union. In 1997 the number had fallen drastically to 12 percent. Nowadays it is so minute that nobody cares to count. A few years ago, the current prime minister, Edi Rama, invited a group of Italian businessmen to invest because Albania “fortunately lacks trade unions.”

Fortunately enough for the guardians of the new social formation, from the early 1990s onwards there has been a way out: emigration. Instead of fighting to defend their industries, the largest part of the Albania’s working class opted to work abroad, especially in Greece and Italy, where work remuneration was several times higher. Today almost one-quarter of Albanians are emigrants.

Despite its industrialization, even during socialism Albania remained mostly an agricultural country, where up to 60 percent lived in the countryside. In 1991 the state-run cooperatives were dismantled and a new agrarian reform divided land equally among peasant families. The agricultural infrastructure was all but destroyed, and the process of economic differentiation is still very slow; meaning that most peasants resist proletarianization and cling to subsistence agriculture. The countryside’s exceptional poverty explains the higher rate of migration abroad or towards big cities shantytowns.

From the early 2000 onwards, the process of privatization swept across what had remained of the state’s giant corporations, especially in the service and banking sector. Most of them are owned by foreign capital. Extractive sectors such as oil fields and chromium mines are also rented to foreign capital or joint ventures.

Trade liberalization and the opening of the economy have meant that the Albanian economy could have only a subordinate and peripheral function in global capitalism. Deindustrialization has paved the way for a kind of revival of manufacturing, which exploits low-skilled workers. The shoe and garment sector are expanding, subcontracted by foreign large corporations, where local bosses represent a kind of middle bourgeoisie. Wages and working conditions are miserable (a shoe and garment worker isn’t paid more than 200 USD a month). The same subcontracting logic also applies to the call centers, whose workers — mostly students speaking Italian — are paid an average 350 USD.

Above them lies a speculative economy, where the big bourgeoisie, in close concordance with the state bureaucracy, accumulates capital in various illegal and quasi-legal forms and invests it in construction, real estate, trade centers, TV stations, hotels, and restaurants. Organized crime, moreover, is one of the main sectors of capital accumulation. Previously engaged in criminal activity abroad, in the recent year mafia bosses have invested in marijuana production and traffic, bribed central and local authorities, and in a few years were transformed in respected businessmen — helping the main political parties to buy and capture votes. In return, some of them have been elected as members of parliament or mayors.

This big bourgeoisie lives off the state. They gain lucrative state contracts to build ill-advised public infrastructure — especially roads — which led to growing indebtedness to international financial institutions. After the IMF veto on raising debt-to-GDP ratio (currently on 69 productive), the government is trying to finance its clients in the speculative economy by public-private partnerships. Now that anything productive is privatized, the state is left to partially privatize its basic services — like hospitals, schools — or subcontract some of its basic activities (like customs).

Higher Education as a Prize and a Way Out

Higher education was one of the last islands to be engulfed by the new social formation’s capitalist logic. Its successful commodification, which went full-speed after 2013, was modelled on the similar transformations of the public health care system. And yet since 2014 public universities have also been the main site of resistance against neoliberalism.

Historically speaking, when the Communist Party took over in 1944, the illiteracy rate in Albania was 81 percent. There was a gigantic education and emancipation effort during the four and a half decades of socialist rule. In 1957 the first Albanian university (the University of Tirana) was established. Universities produced a qualified workforce for the emerging industry, state, and party cadres, and a plethora of employees in basic state service sectors (teachers, doctors, nurses, etc.). Graduating meant not only higher work remuneration, but also a more respectable social status. University admission was tightly controlled by the state and party authorities, where subjects considered disloyal to the party were discriminated against (although there was no written law preventing certain social categories’ admission in universities, students, in addition to good grades, needed a party recommendation to be enrolled).

Nonetheless, socialist industrialization and modernization, although extensive, was never deep. The most advance technology came from 1970s China. There was no computer-based industrialization or a cognitariat. Therefore, the university-qualified workforce and intelligentsia continued to form a marginal part of Albania’s socialist society. There were approximately 25,000 university students in 1990, in a population of more than 3 million.

In the early 1990s a democratization of university admission took place. Political discrimination was lifted. However, the weakening of state apparatuses, the disconnection of higher education with better-paid jobs and high social status, the continual expansion not followed by proper state financing, and the emergence of clientelist relations within the university and among professors and political parties led to the deterioration of the university system.

The growth of university admissions was slow until the early 2000s. The number of students in 2004 had reached no more than 43,000. From 2005 onwards the numbers skyrocketed, reaching the climax of 173,000 in 2013.

What happened? Firstly, the early 2000s saw the rise of private universities. They engaged in a predatory approach towards student recruitment, promising almost anything — from secure employment to abusively high grades. Secondly, the center-right Democratic Party government expanded public universities’ quotas in an attempt to postpone youth unemployment until after graduation and gained electorally by the initial enthusiasm of newly enrolled students. Naturally, there hasn’t been any increase in the public universities’ budget, meaning that tuition fees rose annually by 5 to 10 percent. Although the Albanian economy did not need much of a graduate workforce, the social desperation of unemployment and the normally illusory hope of using clientelist connections with political parties to find employment in the state administration led to massive enrolment.

These private, for-profit universities were made possible thanks to a 1999 law introduced by the center-left Socialist Party, then expanded considerably after the Democratic Party took power in 2005. There was a need for a new investment outlet for the capital accumulation of the 1990s, and private universities were actively supported by the government. Firstly, the latter lent or sold them cheaply important state-owned buildings, which were transformed in university campuses. (In the beginning, they were rented and then, after fulfilling the formal condition of investing in the regeneration of the building, they were privatized on preferential terms for the buyer). Secondly, it granted them tax privileges. In 2009 private universities were the sole for-profit enterprises which were exempted from the value-added tax. In those years the government asked long-employed teachers to hold a master’s degree and nurses to gain a bachelor’s degree as a condition to keep their jobs. That created an enormous effective demand for diplomas in private universities, where you could almost buy such a qualification.

Until 2013, the commodification of higher education affected only private universities. That year the newly formed Socialist Party government started an aggressive neoliberal reform in higher education. Private university bosses — also owners of construction firms, TV stations, or newspapers — asked for direct public funds. Inspired by the Chilean university reform during Pinochet’s rule and formally modelled on the British university reforms of the Blair era, this shift was based on the principle of financial competition between public and private universities, the control of the university boards of administration by government employees, and the reduction of student participation in university governing bodies. The student was considered as a customer, professors as wage laborers, and the university as a cost-effective institution. Advertisements in university campuses were becoming common and curricula were expected to transform in accordance with market needs. Impoverished public universities were forced to raise tuition fees, especially in master’s degrees, and start a plethora of new programs whose sole purpose was “to look interesting from a market perspective.”

The barons of public universities — rectors, deans, senators, old professors etc. — played the role of zamindars in colonial India. The “feudal” character of their rule supplemented and supported the partial commodification of public universities. They were the powerful enablers of this process, especially by subduing internal resistance.

Despite these efforts, the main problem of university life in Albania continued to be the unemployment and underemployment of graduated students. A peripheral economy doesn’t need a large stratum of intellectual workers. Conversely, the state administration is overly burdened. As time goes by, the number of disillusioned graduates and students grows. Some of them emigrate. Especially in the last years, a lot of doctors and engineers have migrated to Germany. (Annually, on average 150 doctors and 800 nurses migrate legally.) For the rest there’s only one solution: alienating work in call centers, where the sole required qualification is to speak fluent Italian. While a decade ago working in call centers was considered a temporary job, nowadays it is viewed as the most important horizon of intellectual employment.

Young students start working in cafeterias or other unqualified jobs from the first years of their study. Most of them come to Tirana (where the majority of universities are based) from peripheral areas of Albania. For them, graduating is the only hope of social mobility, the other being crime. Needy, poorly paid, thrown in a city where everything is expensive, most of the time discriminated against culturally — they are forming the new precarious proletariat. They are nonetheless mostly eager to learn. The internet and social media have an empowering potential, where young students could improve their foreign languages competence, learn from a wide world, and be inspired by student revolts elsewhere.

These were the social agents of December’s political upheaval. Protesters asked for everything, immediately. Almost all of the ideas and slogans of the leftist Lëvizja Për Universitetin’s (a student movement founded in 2014 to counter the neoliberalization of higher education) were embraced by the mass of students involved. What may, amidst the wider neoliberal ideological context, have looked like utopian demands rapidly became politically hegemonic. The center-right Democratic Party promised that once in takes power, it will implement a program of tuition-free higher education and serious financial support for poor students. Media pundits were forced to revise their political views, and move leftwards, at least during the peak of the protests. During the first three weeks of December the students totally paralyzed the government (Edi Rama was forced to fire more than half of his cabinet) and put the whole political system into a crisis. The shared demand called for an anti-systemic political alternative that would spring from the student movement.

In January, massive protests gave way to faculty occupations. The most distinguished site of resistance was the Faculty of Social Science, where for five weeks 200–300 students (10–15 percent of all students) have transformed its everyday operations. Boycotting classes, they have gathered in the faculty hall — improvised as an agora — and held discussions on almost any subject. Inspired by their students, the lecturers of this and other faculties also gathered in assemblies, for the first time in Albanian history. In solidarity with students’ demands, the lecturers of the Faculty of Social Science have mounted a three-day strike and are now holding assemblies together with the students in order to side-line the faculty’s official bureaucracy.

During these two months students have achieved a lot. They have managed to secure a 50 percent reduction in tuition fees for undergrad students and the promise that something will be done to improve their studying and living conditions. Though they did not explicitly demand anything outside the university realm, they also pushed the government to raise the official minimum wage by 8 percent and promise to withdraw from the most predatory aspects of public-private partnerships. However, there remains a lot to be done. Masters’ tuition fees have not been cut, student representation in university governing bodies has not changed, while the corpse of the higher educational law continues to stink.

Yet the students’ success also goes beyond specific demands. Their powerful movement has fractured neoliberal hegemony: in the streets you can hear ordinary people talking about the students’ struggle. And it has also raised common people’s expectations of what they themselves can achieve, as we saw in the oil refinery and shoe factory strikes in January. The student protests have been a historically important movement. But they are just the beginning of a long emancipatory process.