Remember the democratization of the Ukraine? Anders Aslund offers a sorry update:
For the past eight months…Ukraine’s economic policy has been nothing short of disastrous. Economic growth has plummeted from an annual 12 per cent last year to 2.8 per cent so far this year, driven by a fall in Âinvestment.
The blame for this startling deterioration must lie with the government’s economic policies. By agitating for widespread nationalisation and renewed sales of privatised companies, the government undermined property rights. In addition, it raised the tax burden sharply to finance huge increases in welfare spending and public wages. Very publicly, Ms Tymoshenko interfered in pricing and property disputes, criticising individual businessmen. Chaos and uncertainty prevailed. This populist policy had little in common with the electoral promises of Viktor Yushchenko, the president, about liberal market reforms.
There is much more, read the whole thing.