Estonian Human Development Report
Estonian Human Development Report - Eesti Koostöö Kogu
Estonian Human Development Report - Eesti Koostöö Kogu
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Table 7.2. Potential economic developments in the<br />
case of different courses of action taken by the government<br />
as well as either a shorter or longer recession in<br />
the external environment<br />
Type of economic<br />
crisis<br />
scenario<br />
A. Postponing<br />
decisions<br />
B. Following<br />
social priorities<br />
C. Following<br />
business<br />
priorities<br />
1. Quickly stabilizing<br />
and improving external<br />
environment<br />
A1 – high risk of failure<br />
B1 – has a chance of<br />
success if additional<br />
resources are found<br />
C1 – chance of success,<br />
requires a social contract<br />
2 External environment<br />
continues on a path of<br />
faster or slower decline<br />
A2 – certain catastrophe<br />
B2 – not sustainable in the case<br />
of a longer period of decline<br />
C2 – may succeed in the case of<br />
the sharper and faster decline<br />
but requires the common<br />
effort of business owners and<br />
employees; likely to fail in the<br />
case of a long downturn in the<br />
external environment<br />
and formulate them as specific goals and criteria for carrying<br />
out project competitions). The greater empowerment of<br />
local and county-level agencies in deciding the uses for EU<br />
funds would facilitate the more flexible employment of EU<br />
funds in reacting to local needs and meeting the demands of<br />
important target groups. The needless waste of time related<br />
to bureaucracy, which hinders the movement of funds and<br />
the implementation of projects is especially inconvenient in<br />
the case of a crisis. The efficiency of the projects with regard<br />
to human development should be analyzed by scientists and<br />
representatives of civil society.<br />
How can we use the crisis situation for<br />
the benefit of human development, for<br />
transforming values and increasing social<br />
capital?<br />
The crisis situation is, among other things, a challenge for<br />
finding new solutions and for adopting new goals and values,<br />
not only for companies, but also for public officials, politicians,<br />
the civil society and every family. At the peak of the<br />
wave of civic activity at the end of the 1980s and the beginning<br />
of the 1990s, the <strong>Estonian</strong> society was able to devise<br />
and implement such social innovations as the nation-wide<br />
discussions regarding the IME (Self-Governing Estonia)<br />
project, the creation of Popular Front of Estonia as a bottom-up<br />
network of support groups, and the voluntary registration<br />
of the <strong>Estonian</strong> citizenry. It is not inevitable that<br />
social tensions created by the crisis be transformed into<br />
negative energy, unleashed by breaking windows and<br />
destroying the state. Guaranteeing a real outlet for the civil<br />
society’s initiatives is the best way to prevent and avoid the<br />
negative social effects of the crisis. The crisis provides an<br />
incentive for the transformation of values, specifically the<br />
replacement of material success-oriented values with social<br />
and intellectual values. In a crisis situation that limits families’<br />
consumption opportunities it is easier to substitute the<br />
impulse to acquire new things with the habit of attributing<br />
a greater importance to health, spirituality, personal relations,<br />
the time spent in families on each other, especially on<br />
children and young people, attention towards the weaker<br />
members of society, and awareness of nature and other people.<br />
Investing into health, education, social capital, and the<br />
value-based upbringing of the youngest generation requires<br />
intellectual alertness and organizational initiative as<br />
opposed to expensive imported goods or costly infrastructure.<br />
We do need to recognize, however, that social capital<br />
does not grow on trees – it needs public space, information<br />
and communication, encouraging symbols as well as dedicated<br />
and selfless leaders. In this regard, cultural institutions<br />
and cultural events that energize the public intellectually<br />
play a very important role.<br />
In order to recognize and use the new opportunities<br />
available to us in the crisis situation, it is necessary to have<br />
a public discussion regarding society’s problems as well as<br />
to provide business owners, officials, heads of organizations<br />
and top specialists, politicians and leaders of civil<br />
societies with training that would allow them to disengage<br />
from routine thinking and inspire them to search for new<br />
goals and development paths.<br />
What social resources produced by Estonia’s human<br />
development can be used to recover from the crisis?<br />
Which factors favour and which ones hinder our recovery?<br />
(see Table 7.1.)<br />
In what aspect should human development<br />
and the social resources of the <strong>Estonian</strong><br />
society be taken into account when<br />
developing strategies for overcoming the<br />
crisis and setting budgetary priorities?<br />
The process of developing crisis strategies has two aspects.<br />
First, the inevitable need for a rather sudden retrenchment<br />
focused on cutting the budgetary expenses of the public<br />
sector; and second, the implementation of an effective set<br />
of measures aimed at quickly readjusting the economy, creating<br />
new employment opportunities, finding investments,<br />
etc. A society’s social resources as well as its attained level of<br />
human development affect both of these aspects.<br />
Limiting budgetary spending requires us to find a compromise<br />
between the level of tolerance of various social<br />
strata, especially those that are less successful, and the ability<br />
to maintain our developmental potential. While cutting<br />
spending related to infrastructure or education can be easier<br />
than limiting social benefits that affect a wider segment<br />
of the society, it may not be a justified course of action in<br />
the long-term. At the same time, we cannot allow our social<br />
potential to deteriorate irreversibly. The successful handling<br />
of this type of complex situation is possible only if the<br />
society has faith in itself and trust in its leaders.<br />
The latter depends considerably on the methods used<br />
and respect for people shown by politicians and officials in<br />
the difficult crisis situation. A complicating circumstance<br />
here is the lack of trust in the government and politicians.<br />
The absence of solidarity in our multi-ethnic society is an<br />
important risk factor, along with the weakness of longterm<br />
forethought both among the people and the elite.<br />
The measures that stimulate economic growth can<br />
provide results only if the corresponding institutions have<br />
the capacity for the fast and carefully considered development<br />
and implementation of such measures. Furthermore,<br />
there needs to be sufficient human and social potential<br />
to utilise the measures. This includes business owners’<br />
initiative, flexibility, aptitude for cooperation, ability to<br />
function internationally as well as another very important<br />
factor – the level of education of the labour force. As a<br />
rule, labour force with a higher education is more flexible<br />
and better at reorientation, a resource which might prove<br />
important for Estonia.<br />
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