Without A Common Market

The Constitutional debate has resulted in stormy reactions. Nobody is neutral, everybody either supports a federation or opposes it. Only the ruling Socialist Party of Serbia (SPS) is maintaining an aloof image. But this is just an illusion. Quietly and without much fuss the SPS proposed a draft law on referendum last Friday, thus bypassing the complicated procedure on amendments in the Republic of Serbia Constitution. They opted for this move because none of the proposed amendments to the Federal Constitution are to their liking.

Is Yugoslavia a federation or a confederation; which is better: the principle of one man one vote, or that of one republic one vote? As far as I am concerned, I would like to see the problem solved along the lines of one state one market, one dinar one DEM. If we have a single market and strong dinar, we will have settled accounts and many dilemmas concerning the state's organization will become unimportant.

The prerequisite legal condition for a single Yugoslav market is the inviolability of private property and the definite transformation of sociallyowned property. This, however, is where the problems crop up. A federation is empowered to organize only ``basic ownershiplegal relations.'' Everything else comes under the competency of the republics. The transformation of sociallyowned firms into privately owned ones came to a standstill in Montenegro last year. It is practically finished in Serbia: it was carried out with the help of inflationary profits, or the firms became stateowned. A fundamental coordinating of both ownership systems is impossible. This is why laws on firms, on the transformation of socially owned property and the civil law are late in regulating the situation. Serbia got its civil legislature in 1844, during the heyday of pig merchants and illiterate rulers. We are more literate today, but we still don't have a civil code.

Serbia and Montenegro staged a customs war last year. It was the direct result of the lack of free trade and a single Yugoslav market. Last year the Federal government tried to harmonize economic policy, and all pulled the dinar their way, thus rushing headlong into hyperinflation. The budgetary laws of the republics and the federation allow them to run into longterm debts with the National Bank of Yugoslavia, and to finance their debts by printing fresh money. Last year this was done until the dinar was destroyed as a means of payment.

In order to maintain a strong dinar, the money printing policy must be coordinated with taxes and public expenditures. And this is where matters have not been regulated properly. The Federation sets down only the ``basics of the tax system'' and there are no constitutional guarantees for determining a consolidated balance of public expenditure.

The Federal law on the fundamentals of the tax system cannot be adopted because the two republics cannot agree on matters. Then again, the harmonization

of economic policy is achieved by consolidating public expenditure; this is the result of current political agreements and not longterm constitutional solutions.

This agreement broke down last year. One of the key participants has changed this year, so that this modern version of the former ``interrepublican committees'' is functioning well. It remains to be seen, however, how long we will be able to play this game of chance and when new rules will be introduced.

If the citizens of two states wish to live in a single state, they must have a better standard of living than when each lives independently. Emotions do not keep countries solvent in the long run. In Europe, the advantages of a single market have united countries which fought continuously through history. Serbia and Montenegro have never fought against each other, but the lack of a common market threatens to separate them. In a single state, taxes and ownership must offer equal opportunities to all who wish to live well off their work and capital. Otherwise, there will always be suspicions that others are to blame for our economic problems.