Why Yugoslavia collapsed

The biggest protests were, even then, around the ethnic conflict in the predominantly ethnic-Albanian Serbian province of Kosova. The Serbs, under the leadership of Slobodan Milosevic, claimed that the Serbian minority in Kosova was being persecuted and demanded that Kosova be re-integrated into Serbia. Serbian nationalism resurfaced in its ugliest form. This Serb nationalist agitation for Serb aggrandisement, and Serbia's drive against Kosova, destabilised the whole of Yugoslavia and eventually led to its destruction.

Meanwhile, Yugoslavia was in the grip of a tremendous economic crisis. Inflation ran at over 200% a year. Around one million were unemployed -15% of the workforce. In some regions - the poorer south - the rate of unemployment was nearer 30%.

Unable to keep up with repayments on a foreign debt of $20 million, the federal government negotiated a rescheduling deal with the IMF; the IMF, not surprisingly, demanded an austerity plan that removed state subsidies to loss-making enterprises, and a wage freeze.

The crisis, and the austerity plan, fuelled workers' protests. In 1988 workers and groups of students demanded an end to the economic attacks on the working class and also the right to organise.

The crisis exacerbated regional tensions. The northern republics - Slovenia and Croatia - were considerably more prosperous and highly developed economically than the south - Macedonia and Montenegro. The Northern bureaucrats resented what they saw as being forced to subsidise the poorer south.

The Yugoslav CP, under Tito, had taken power after a guerrilla war in 1943-4 and broke with Stalin in 1948. They had massive support in Yugoslavia because of their struggle against the Nazi occupation. Stalin could not deal with a ruling CP that had an independent base. Between 1948 and 1950 Stalin withdrew all aid to Yugoslavia.

But Tito's programme remained a Yugoslav version of "socialism in one country". Many socialists saw Yugoslavia as a new anti-Stalinist model of socialism because the system of "workers' self-management", introduced in June 1950, appeared to give workers real power over their factories and communities.

But the "self-management" structures were never more than a top-down system that gave the workers only token power. All real social and political power lay in the hands of Tito and the CP. As time went on, it became clearer and clearer that in the factories the technocrats ruled, and the "power" of the councils was circumscribed by federal government. It was pseudo democracy with no real content.

Tito got Western financial aid after the split with Stalin. Industry was rebuilt and developed. Between 1950 and 1960 the economy grew at an average rate of 13% a year. But the economy was beset from the start by sharp regional variations in development, and by empire-building which meant that regional bureaucrats duplicated production wastefully and ran many plants at a loss, putting a massive economic strain on the central government.

Tito's answer to this was "market socialism". Only profitable enterprises were to qualify for state money for expansion. All central plan directives to enterprises were abandoned. The new scope for market forces led to unemployment, increased inflation, growing foreign debt. It also exacerbated the divide between north and south. The federal government intervened to subsidise prices of basic goods and to direct banks to invest in the poorer regions. The bureaucracies in the richer regions resented this.

Yugoslavia - the state was originally established as the victors of World War 1 tried to sort out the fragments of the collapsed Turkish and Austro-Hungarian empires - comprised six republics and two autonomous provinces in Serbia. There were four main religious groups, 22 ethnic groups, and even two alphabets. In Vojvodina autonomous province, the public notices were all in four languages. Tito had to find some mechanism to avoid ethnic disintegration.

In 1974 a new constitution was introduced, giving considerable powers of self-government, including the right to raise taxes, to the republics. The federal government worked on a consensus basis so that no particular grouping could dominate. Sitting on top of this edifice, and holding it together, was Tito himself, with his huge personal prestige.

After Tito's death in 1980 a "collective presidency" was established consisting of representatives of each of the six republics.

By the late 1970s signs of a deep crisis were beginning to show. Things became steadily worse in the 80s, culminating in the IMF agreement.

Workers struck and protested, but the dominant form of dissent was nationalism, partly for the reasons outlined above, but also because in a state where workers could not organise legally, nationalism was a sanctioned form of dissent.

The nationalist agitation in Serbia broke all bounds. Slobodan Milosevic exploited the discontent of the Serbian population. The leaders of other republics looked on this with horror knowing it would threaten their own power.

The nationalism of Milosevic had nothing in common with the legitimate demands for regional and national rights which would be part of the programme of a democratic workers' movement in Yugoslavia. The demand for control of Kosova was thoroughly reactionary.

Kosova's 90% ethnic Albanian population should have had the right to secede if they so wished.

Despite all its peculiarities, in many ways Yugoslavia as it began to fall apart showed its future to much of the USSR and Eastern Europe: the inability of "market socialism" to cure the crisis of the state monopoly systems, the explosive force of nationalism as the grip of Stalinist repression eased, the unbridgeable conflict between the bureaucrats and the workers. In the 90s the USSR and Czechoslovakia would fall apart like Yugoslavia.

The crisis in Yugoslavia already showed the impasse of "market socialism" even as the other Eastern Bloc countries looked to it as the answer to their problems. It showed that the Stalinist system was fundamentally irreformable.