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 1. Introduction

Many people nowadays recall the times of former Yugoslavia with nostalgia, and often in this connection raise up the issue of possible options for the re-establishment of the former Southern-Slavic Federation: various scenarios for the development of the situation - from denial of such possibility to blind faith in the prospect of a new unification of the country in the conditions of the 21st century. What are the prerequisites for the development of such feelings and moods, additionaly backed up with a lot of public political speech, and what are the objective circumstances related to the phenomenon "Yugoslavia", possessing the minds of several generations of the citizens in the Balkans?  In a great extent, this issue is be related to the actively spreading nationalist idea that has been over Europe for several centuries, becoming one of the essential factors transforming former territorial empires and creating in their place national states of a new type that no longer rely on the leading role of a particular religion or communist ideology, as a variation of the already existing religious teachings as a basic element of the state construction. The question under consideration is sufficiently relevant in the light of the events that have taken place in the last few decades when countries which put the national idea on a pedestal are being set up in the place of the ruining empires. This delicate and controversial topic is insufficiently investigated, due to the contradictory nature of its treatment by the person interested and the strong emotional burdens imposed on it. All these issues related to the role of the national idea in the formation of  the modern countries have a strictly economic implication, and in this specific report exactly this particular goal is set - to briefly describe the history of the problem, the genesis of its development and the economic issues that the creation of national states in the last few centuries of the development of human civilization is solving, and in particular on the territory of the former Yugoslavia.

2. The idea of the nation in the context of the industrial revolution - history and contemporary projections. The regional project for Yugoslavia as one of the attempts to build a country outside the national paradigm.

At first this idea of one nation (in its current version) is offered by the Catholic Church in its fight against the secular imperial powers in the Western Europe Middle Ages. In the context of conflicts with the empire, the church authorities need to support the proto-national possessions that split from the territory of these same empires, in which local monarchs rule. These possessions and the source of their power do not, however, enter the traditional notions of the world, which requires the church to admit that, from the point of view of the divine laws, individual nations have the right of a legitimate existence. In this case, the source of power of the "national" monarch is not the entire Christian people, but only its separate part - the "nation" from which it gets his legitimacy. The idea of democracy is being born, and its basis is based purely on pragmatic considerations, according to which the monarch is the only legitimate representative of the executive power. At the same time, it is necessary that the legislative powers are being transferred to the people, who are a part of the large Christian population. In the everyday life people are being controlled by priests in every aspect of the life of an ordinary person who is under the leadership of the Catholic Church. Thus, indirectly, the latter is able to fully use its powers in the legislative branch and strengthen the power of the local feudal lords, who do not always agree with the decisions of the imperial center. The very idea of a separate nation fits very well into the doctrine of the Reformation - a new religious movement that sets itself a goal to update and modernize the rituals and structure of the Roman Catholic church itself. As a result of the Reformation, a new course in Christianity is identified, called Protestantism, within which later the first national Protestant churches appear. Thus, in Western Europe, the first national states of the modern type – Richelieu France and the first Protestant national state structures - are segregated. The last ones are developing until the second half of the nineteenth century, when the unification of all German lands under the leadership of the Prussian King Wilhelm I, which after the unification was proclaimed by the German Emperor, is being realized.

Since the XV century in the northern and western Europe the process of the economic boom is parallel, in the frame of the ongoing industrial revolution. What are the background, causes and results of the last one? The industrial revolution is, at first and foremost, a sharp leap in the level of division of labor of producers within the framework of new structures that have emerged in large numbers - firms. The industrial revolution is a long and massive process. Initially, there is a creation of firms in one industry, as a result of which the amount of production sharply increases. After that, a wave of demand is created in related industries, and firms are gradually formed in them. The process of embracing all new territories in the same way continues further, capturing gradually almost the entire economy and demanding access to foreign markets.

To explain the genesis of the industrial revolution, it is necessary to look for and describe some powerful bend in the structure of the world economy of that period, and to explain the reasons for its appearance. Let’s recall that in the XIV-XV century the western part of the Old Continent is a backward periphery of the world, and the center of the world"s economic prosperity lies far in the East, in China and on the islands of Indochina. Within the framework of the Eurocentric view of history, it is generally accepted that the roots of the industrial revolution must be sought in Europe itself. But actually, the goal of the geographical discoveries of that time was precisely the search for direct roads to the center of the then world trade - the rich East, so that more intensive contacts could be made with the latter. Even after the Great geographical discoveries, for a long time the amount of the European trade remains too insignificant towards the global ones. It is exactly the peripheral position of Western Europe in the then system of the division of labor that is one of the basic prerequisites for the subsequent sharp leap to its development in the next few centuries. In the period before the industrial revolution, Western Europe plays the role of raw material appendage of the world economy, in the form of mining and production of minerals and their subsequent exportation to the rich part of the world. However, this is a rather specific raw material resource - noble metals, which in this era fulfill the role of money.

A successful country can’t become such in itself, but only within the framework of a certain configuration of the world economy and a set of complex factors at a certain point in the economic history. The specificity of the Western Europe of the early Middle Ages after the collapse of the Roman Empire is that economic life is completely transformed into a natural exchange. During this period, money almost disappears, moving to the treasuries of the Catholic Church and local military leaders, later turned into feudal lords ( lets recall that we are talking  about gold and silver coins). What remains in circulation, gradually flows into Byzantium, and further to the shopping centers of the then developed world. In such conditions, the government functions without being able to use money as an instrument of influence within the framework of reward and punishment systems. There is only one left: the distribution of land[1]. Thus, for the first time in the modern known world, there is a phenomenon that manifests itself in the fact that power is separated from money. That is why today in the "civilized" world there is a widely held opinion that unlike the West, the "wild" East could not perceive the "useful" idea that money should be separated from the authorities. Even more - in many cases in the East, corruption is not even perceived as such. In the Middle Ages, the main form of wealth in Western Europe is the possession of land. Feudalism is manifested exactly in this: the merging of power and land wealth, and not wealth in monetary form.

However, at some point, money in Europe becomes abundant. How does this happen? This is a long process, in which parts of the Western Europe are gradually turning into a kind of offshore zones of the then world. In that period, as today, in the east, money always goes along with the authorities - the loss of the latter is linked with the loss of monetary wealth. Moving their money (or a part of them) to Europe, every medieval (and today"s) philistine from the East can guarantee a certain standard in case of loss of position in the homeland. And not only! He can continue to develop trade, already moving (along with his wealth) to Europe. In this case, the difference for the trader is that he already receives all the profits realized by him on his account, in contrast to his previous status, when it was necessary to work for the eastern ruler (a kind of court trader). Repatriation of capital in those times becomes a mass practice. Once the money was on the European territory, it turns out that for them you can find a fairly profitable application in local markets, which subsequently leads to a general revival of domestic trade in the Old Continent. It is quite natural that local feudal lords accept on their territory with open arms these fresh cash flows, with which they can finance, for example, their endless wars with their neighbors, and sometimes even with the central imperial authorities. Gradually moving to the west, eastern traders buy entire urban areas, thus creating the first medieval free cities in Europe [2].

The constant state of lack of money in the early Middle Ages requires from European owners continuous seek for solutions of this problem. It is on this wave that mercantilism becomes popular, and its representatives offer a lot and a variety of recipes to the respective owners about how to get and hold money within their estates. Later, Max Weber formulates the thesis that "competition for mobile capital is the most important phenomenon that predetermined the course of the new European history." A variety of measures arise in the search for a solution to this existential question, among which direct support from the state in the development of local crafts and manufactures (including the application of customs tariffs). We remind you that at the same time, world trade is absolutely free, and the rich eastern countries do not even think of applying any protectionist measures towards the outside world, which is a complete surprise for European countries when making the first contacts between the West and the East. Gradually, with the strengthening of Europe, the principles of protectionism and trade are increasingly being applied in the rest of the world, and the practice of monopolizing sources of raw materials and processed goods, as well as delivery channels with specific private benefits, extends to the whole world, and world trade itself is more and more being built on the basis of the colonial policy pursued by leading European states.

Another trend, which can be observed due to the separation of money from power in this period, is a sharp increase in the concentration of the financial sector in certain territories of the Old Continent. Important prerequisites for such a concentration are the presence of the so-called logistical factor - the possibility for relatively inexpensive transport links with external territories, and the overall security of the corresponding territory. Originally the absolute favorites in this sense are the Italian coastal city-states, which have already used the best way of an uninterrupted conflict between the secular and ecclesiastical authorities, receiving, on two sides, the most diverse privileges and guarantees for their existence. In such circumstances it is quite natural that initially the financial sector finds its "quiet harbor" in places like Venice and Genoa. However, over time, the costs of protecting such cities increase dramatically, and gradually Italian cities begin to lose financial entities at the expense of the Netherlands. Thereafter it goes back to England, and then the United States of America.

An important feature of the territory on which financial activities are concentrated is that labor costs are consistently higher than those that are characteristic of neighboring territories, including activities that do not have direct links to the financial business. Thus, the high price of labor forces leads to an increase in incentives for the mechanization of production operations and the introduction of innovations that lead to a reduction in labor intensity. For example, England is no exception to this rule - the concentration of the population in its large financial centers, and primarily in London, leads to a chronic shortage of labor in agricultural production and to sharp increases in its price, which naturally stimulates the introduction of more effective methods for implementing business in this sector[3]. Continuing the theme of European protectionism, it can be noted that the so-called "Grain laws" that prohibit the import of grain crops to the island, also contribute greatly to the modernization of the agricultural business in this period.

Since the beginning of the XVI century on the world markets a great imbalance is beginning to develop, which is expanding over the next several centuries. It is about the discovery of America by Europeans, after which huge amounts of precious metals are transported to Europe. This causes a significant inflation. Just a few decades after Columbus, in 1568 the French researcher Jean Boden formulates the connection between the unusual rise in prices and the growing amount of money coming from the American continent. Very soon, inflation extends to the periphery of the European continent. For example, in 1589 the first insurrection of the Janissaries was registered in the Ottoman Empire, provoked by a sharp devaluation of local gold money and a two-time price increase in the empire[4]. Gradually, the Ottoman Empire begins to lose its geopolitical and economic positions and soon turns into a "sick man of Europe", which creates fertile ground for the development of ideas external to the empire, including the idea about the "separate nation" in the Western European understanding of this concept.

As a result of the European inflation, a serious gap between the East and the West in the levels of nominal (and subsequently real) incomes of the labor force appears. In general, inflation in Europe (recalling that precious metals are money) makes local production absolutely uncompetitive in world markets. Countries in Western Europe are forced to continue to implement protectionist policies and reduce the labor intensity of their products, in their attempts to stop the outflow of money from their territory. But money continues to follow its traditional course towards the eastern markets, from where the goods flow down backwards, with labor costs several times lower than in Europe. However, because of undeveloped transport infrastructure, initially it is mainly about import of luxury goods that are not available to mass consumers[5].

And then the cotton comes to the forefront, which is at the heart of the industrial revolution in England (this issue is discussed in detail in the monograph "The International Forecasting and Planning Phenomenon" (Hitov, 2018). Only for a few decades, factory production defeats in the competition with the manual labor market at the production of cotton fabricks. After the British fabrics decisively seized the European and American markets at the beginning of the 19th century, in 1822 they registered a presence in Indian colonies. Just 12 years later, the representative of the British Crown in India, William Bentink, notes that the bones of local weavers are whitenning along the roads of the Indian valleys. The Industrial Revolution is a fait accompli, engendered by a unique combination of a multitude of political and economic factors that at the right time have manifested themselves in England and nowhere else in the world. Financial and commodity flows are changing their direction of movement - the goods are already moving to the east, while money, in the form of precious metals, is sent by a powerful stream to an increasingly industrialized Europe. In the face of widespread protectionist measures on the part of individual European states, industrial production is gradually beginning to spread by exporting production facilities and entire enterprises to nearby areas, which are characterized by a high level of nominal prices (money is expressed in precious metals). The industrial revolution continues its spread, initially in the most Western Europe, then in the central and eastern, and towards the end of the nineteenth century to the Russian Empire.

In the new conditions, the countries of the East are already organizing attempts to close and to save themselves from the powerful flow of industrial goods pouring from Western Europe. However, the latter already has not only an economic but also a military and ideological advantage, which it actively uses for its own purposes. In the East, deflationary processes begin, which eventually turn into chronic ones - it is known that deflation leads to a reduction in economic activity. In its new configuration, the world economy is divided into two parts - the rich West and the rest of the poor world. The only problem facing this rich West is that it must continuously seek new markets for the realization of increasingly efficiently produced industrial products.

How does the situation look like in the middle of the nineteenth century? At that time, two industrial centers of Europe had already formed, which confrontation, especially after the unification of all German lands, sharply increased - the British Empire and the German Empire. The rivalry, especially after seizing all areas accessible for economic expansion, is greatly exacerbated. We remind that within the framework of the existing model of development, innovations become possible only with expanding markets, which give access to additional consumers for an increasing amount of products. The crisis that began in 1873, largely characterizes the situation, which is repeated later (recall the Great Depression of 1929-1933), and in which the modern world lives in the last decade - the inability to expand markets within the existing technological zones. We remind you that at the end of the 19th century the world has four independent technological zones - British, German, American and Japanese, and in the beginning of the 20th century there is also a Soviet technological zone.

Let us return, however, to the half and the second half of the nineteenth century! The first global deflationary crisis of the development model is in full swing. How, in these conditions, are the two most ardent competitors on the European (at that time equivalent to the world) stage - the British and German empires? Let us recall the alignment of forces between the two opponents! The British technological zone includes the Ottoman Empire, and the Russian Empire in the German Technological Zone. Both these semi-feudal empires (the Ottoman and the Russian) are already hopelessly backward from the most developed industrial countries of the time, their internal state structure based on the supremacy of a certain religion (Orthodoxy in the Russian Empire, Islam in the Ottoman Empire) is faced with actively promoted new for that time national ideas. Throughout the nineteenth century, Germany actively promotes them, especially in that of the religious empires, where the influence of the enemy (the British Empire) is undeniable - the Ottoman Empire. Within the framework of the Russian Empire, which is clearly embedded in the German Reich"s economic interests by many threads as its raw material appendage, the national question is not raised very much, except in a latent order, where it is carefully developed for those Orthodox who were outside the Russian Empire (let’s remember that in it the Orthodox people is also a state-forming one). It is mainly about the Orthodox who inhabit Austria-Hungary (also in the German division of labor system). Let’s recall that today there is such a denomination of the Orthodox, who obey the Catholic Pope - Greek Catholics.

Due to the national movements actively supported on the Balkan Peninsula, by the end of the 19th century the Ottoman Empire was completely pushed out of Europe, and after the departure of the troops of the Russian Emperor[6], the newly created Balkan independent states are invaded by German capital, desperately seeking new uses in the face of the most severe deflationary economic crisis of that time [7]. In the conditions of victorious national ideas, national states are formed[8]. And the whole process is accompanied by genocides over "alien" peoples, mass migration of millions of people from all sides - Turks are evicted from Bulgaria (people speaking one of the Turkic dialects and professing Islam) and Greeks, from Turkey (first created) are evicted Bulgarians and Greeks, Bulgarians and people with muslim self-consciousness are evicted from Greece (we recall: they have not yet been made Turks). One of the representatives of the last-named category of people is himself Mustafa Kemal[9], the future Ataturk (the father of the Turks), whose pedigree roots are in the area of today"s Thessaloniki! For many decades on the German capital finds its active use on the Balkan Peninsula, right up to the end of the Second World War. It is the processes of this kind that lead to the fact that during World War I, Bulgaria and its centuries-old puffer, the Ottoman Empire, are fighting together as allies for the interests of German capitals within the Central Forces, against the Russian Empire and Serbia, who in that war are fighting for the interests of the British capital in the Entente.

After the end of World War I, the fate of the late medieval monarchic territorial empires, such as Austro-Hungarian, Russian and Ottoman, was decided. In their place are created national states that gradually integrate in the then world centers of technological development. By the end of World War II, the USSR, which had implemented the last successful project of catching up development in the 1930s and successfully defended it in the battles of the Patriotic War, appeared on the European scene. Under the influence of the proliferation of communist ideas, a socialist Yugoslavia was created in the western part of the Balkan Peninsula, which unifying idea was not national, but a specific religious idea - the communist ideology. With the end of the Cold War, connected with the collapse of communism[10], this ideology comes out of the scene, and on its territory Yugoslavia is actively starting to impose national ideas, and besides from of all the concerned parties.  This regional project, built on the basis of communist ideology (equated with religion), ceases to exist. The formation of the new nation states practically fully repeats these grave ethnic and social conflicts that accompany the creation of national states after the collapse of the Ottoman Empire. It is interesting to note that to a large extent the formation of the modern national state Ukraine is accompanied by the same processes of "national self-determination" that the individual ethnic groups as part of the former Yugoslavia passed through.

3. Conclusion

With the collapse of the Soviet system of division of labor in the late 80"s, early 90"s of the twentieth century the processes of national self-determination continue to develop. And in these processes, each of its newly formed element looks for its place in the global world under the auspices of the United States. This is a new wave of activating national ideas, repeating, as already noted, those phenomena that were characteristic of Eastern Europe at the end of the nineteenth and beginning of the twentieth centuries. However, there is a difference between the two periods, and it is expressed in the fact that in the beginning of the 20th century there are still several independent technological zones, and in modern conditions the whole world (including its raw appendages) lives in one single American technological zone. It is objective that the latter also reached its natural limits of development and, despite its attempts to expand its presence in all corners of the world, the latter can’t give that tangible beneficial effect that is necessary for the normal development of this most global technological zone.

Based on the above, it can be summed up that the idea of ​​Yugoslavia, as it was realized in the second half of the twentieth century, is not subject to reincarnation. Another question is that, within the framework of the objective processes of consolidation of economic systems, the constituent elements of the former Yugoslavia will gradually rejoin such a unified system of division of labor that will not only repeat the Yugoslavian one, but will even extend it far, given that the European Union is a community of more than half a billion high-paying consumers.


-        Grigoriyev, O., The Age of Growth. Lectures on neoconomica. Bloom and decadence of the global economic system. East-West Publishing House, S. 2016 (2014);

-         Hitov, M. Phenomenon of International Forecasting and Planning, UNWE University Press, 2018

-          Smith, A., The Wealth of Nations, IK "Rata", 2006;

-       Durankev, B., The Beginning and the End of the Third World War, Internet Publishing House "Chitanka", S., 1999

- Finkel, К., The history of the Otoman empire. The vision of Osman: АST, 2014

[1] This period lasts long enough (the Dark Middle Ages).

[2] It is known that Venice emerged as a trading colony of the Byzantine Empire.

[3] For more information check: Smith, A., The Wealth of Nations, IK "Rata", 2006.

[4] For more see: Finkel, К., The  history of the Otoman empire. The vision of Osman: АST, 2014

[5] For more see: Grigoriyev, O., The Age of Growth. Lectures on neoconomica. Bloom and decadence of the global economic system. East-West Publishing House, S. 2016 (2014), Ninth lecture: „Formation of the modern economical system“.

[6] Let’s recall - a kind of economic vassal of the German Emperor.

[7] Once again: capital needs constantly expanding applications, otherwise innovations stop, and the entire already constructed division of labor system begins to crumble.

[8] Therein, the Balkan peoples repeat the stages of the formation of the nationality, done by the "advanced" peoples of Europe before. It is known, for example, that before the beginning of television broadcasts, representatives of individual communities living in different territories of France, difficultly, and sometimes completely did not understand each other during a conversation.

[9] An interesting fact about the future father of all the Turks, that in his youth he worked in Bulgaria as a military attache under the Ottoman emperor (the language of his parents was one of the dialects of the Bulgarian). Apparently, he was well imbued with the national spirit, which in those first years of the independent Bulgarian state was felt in the local society (it is known that Mustafa Kemal actively communicated with representatives of the Bulgarian political elite and even managed to fall in love with the daughter of one Bulgarian general). It was this national spirit that he transferred to the Istanbul soil, where he began his rise in the efforts to create a new Turkish nation, through the transformation of a huge mass of Muslims who live their last days in the Ottoman Empire into the Turks.

[10] For more see: Durankev, B., The Beginning and the End of the Third World War, Internet Publishing House "Chitanka", S., 1999


18.02.2019 17:18
The New Ottoman Empire process started long ago and it is unstoppable and inevitable.
This configuration of the Balkans is developed and imposed by the US imperialism.
2. x111 - What CIA thinks....
18.02.2019 17:43
The Next 100 Years is a 2009 book by George Friedman.
3. x111 - Some remarks
18.02.2019 21:27
"will gradually rejoin such a unified system of division of labor that will not only repeat the Yugoslavian one, but will even extend it far, given that the European Union is a community of more than half a billion high-paying consumers."
But Croatia,Slovenia and Montenegro are already a part of the European Paradise Union,it"s a matter of time for Northern Macedonia,Great Country of Albania and Serbia also to step in.
Of course ex-Yugoslavia once had an aircraft industry,automotive industry with highly internal localization and concentration of production,shipbuilding industry and so on.
Today highly fragmented economies of ex-Yugoslavia have totally lost their financial and economic sovereignty, nowadays Croatia,Serbia and Slovenia have a partition type of economy,economy of narrow range of operations and components production with no need of fundamental and applied science,logically as a result of the primitivization,simplification and disintegration of the bigger yugoslavian system of division of labour, and predominantly after the fall of giant for countries like Yugoslavia market of USSR and Comecon.
Explanation and basic observation which compeletely fits into the theory of Neoconmics developed by bulgarian academician Mateev and later by Grigoryev and Khazin.
When the external source of economic growth,mainly export of goods and services, will be exhausted by these countries with the growing of salaries and prices,and after all consumer niches of the internal market of ex-yugoslavian republics will be lost beyond retrieve-these states will be forced to live on credit by perpetually increasing the external debt in order to preserve the amount of gross consumption.
As we know from our own experience this situation can't go on forever.
4. x111 - Basic theorem of world economic development
18.02.2019 21:53
Sustainable economic development and successful economic integration are possible only between countries with similar level of economic progress and structure.

Basic principle derived from the law of synergy effect.
5. x111 - External Debt in Croatia decreased ...
18.02.2019 23:40
External Debt in Croatia decreased to 43557.58 USD Million in October from 44890.44 USD Million in September of 2018. External Debt in Croatia averaged 42386.02 USD Million from 1999 until 2018, reaching an all time high of 70907.14 USD Million in April of 2011 and a record low of 9867.01 USD Million in February of 2000.
August 13 (SeeNews) – Slovenia's gross foreign debt increased 0.8% month-on-month to 43.53 billion euro
6. krizata - Военные преступления совершали все. Кровавый распад Югославии:
23.01.2020 19:14

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