Is America on the Albanian path?
Written by Dr. Jack Wheeler
Tirana, Albania. I had a private dinner with an extraordinary man last night (10/09) - just the two of us with one of his key advisors. Albania is very fortunate to have Dr. Sali Berisha (he's a physician with a specialty in heart surgery) as its Prime Minister. He's a man of immense erudition and learning who is street wise in the ways of the world, having dealt with every major leader on the planet for years. The country he admires above all others is America. In this, he speaks for the great majority of Albanians. Albania is probably the most pro-American country on earth today.
Yet it was a strange and scary experience to hear him relate the recent history of Albania - for at one point he seemed to be describing that of America's instead. What I really hoped he wasn't describing was the history of America's immediate future.
This rugged land of mountains north of Greece and along the Adriatic Sea (Italy is only 45 sea miles away) has been inhabited by Illyrians (ancestors of today's Albanians) for thousands of years. In all that time it has fought for its independence, against Alexander, the Romans, the Byzantines, and the Ottoman Turks.
Its national hero is Skanderbeg (1405-1468), who fought off the Ottomans, rejected their religion of Islam, and befriended the Popes of Rome, who named him Athleta Christi (Champion of Christ) for his protection of Christians.
After his death, the Ottomans finally overwhelmed Albania, forced its people to convert to Islam, and ruled it with Moslem tyranny for over 400 years. With the breakup of the Ottoman Empire during World War I, Albania declared independence - which lasted until Mussolini invaded and took it over in 1939.
After the Fascists were kicked out at the end of World War II, the Communists took over, led by a devotee of Stalin, Enver Hoxha. Pathologically paranoid, Hoxha turned Albania into Europe's North Korea, a hermitized hell-hole of medieval poverty and despotism sealed off from the world. Hoxha finally died in 1985, the Soviet Union dying six years later, and free Albania had its first-ever democratic elections in 1992. Sali Berisha was elected president.
Berisha took over a country a quarter-inch off the ground whose utterly poverty-stricken people had no familiarity whatever with private property or capitalism in any form. He instituted free market reforms and privatized both land and state-owned businesses. There were few banks, however, so informal lending companies arose to provide credit and loans.
Some of them began investing on their own account rather than making loans. (Did the term "investment banker" just occur to you?). They began offering higher and higher returns, escalating to 30% a year. ("Flipping houses," anyone?) They were, of course, paying such interest to previous investors with principal from newer investors - the classic Ponzi scheme.
It grew completely out of hand so fast because almost no Albanians had any familiarity with markets or investing. Two thirds of the entire population invested their life savings in the schemes. By early 1996, companies were paying out 8% a month or over 100% a year; two of the biggest, Xhafferi and Populli, had two million depositors between them - out of a total population of 3.5 million.
By the fall of 1996, Populli was offering 30% a month, and Xhafferi promising to triple depositor's money in three months. People sold their homes, farmers sold their livestock. The Ponzi companies' liabilities were equal to half of the country's GDP, $1.2 billion. They began going bankrupt in January of 1997. The economy collapsed in total chaos.
Berisha took the blame and his government resigned. An impoverished and enraged people elected the old Communist Party - now renamed the Socialist Party - in his place. The country descended into crime and corruption, into a loss of freedom and economic hope that lasted eight years.
Does this saga ring any bells? Do any headlines in our own newspapers over the last weeks come to mind? At least the Albanians have some excuse, coming out of Communism illiterate, uneducated, and ignorant. We're supposed to be a little more sophisticated, aren't we, the smartest guys in the world's room? Evidently not.
Everybody wants to blame somebody else - Bush, greedy Wall Street, crooks like Franklin Raines, corrupt Dems like Chris Dodd and Barney Frank (and yes, I loved it when Bill O'Reilly unloaded on Frank and called him a "coward" on national television).
But the bottom line is that in a country as free as ours, people get not only the government they deserve, they get the economy they deserve. Too many Americans went nuts with trying to make easy money, flipping homes, et al. Too many Americans elected politicians who encouraged or allowed it. And now we have Albania in America.
The real question at this moment is will Americans be stupid and suicidal enough to lash out in frustration and place a Marxist Messiah in the White House? It certainly was what the Albanians did. The Communist-Socialists demonized Berisha and made him the fall guy. And he'll be the first to admit he was on too steep a learning curve to handle the situation. It took him eight years to regain the voters' trust and for the voters to accept what they did to themselves.
Berisha was elected Prime Minister in 2005. The economy was still in ruins. You wouldn't recognize it today. There are explosions of new prosperity everywhere - and this time the economy has a solid foundation. Albania now has a 10% flat tax on personal and corporate income, a 15% payroll tax (down from 30% with the goal being 10%), and 11% GDP growth, by far the best in all of Europe.
Foreign investment is pouring in, the rule of law becoming firmly dependable, public safety vastly improved with crime rates plummeting. It's a country of breathtaking beauty with spectacular mountains and beaches. The tourist potential alone is vast, as are so many other business opportunities.
Should the Marxist Messiah win 25 days from now, 26 days from now money is going to start pouring out of the US in search of safe offshore havens. One of those havens will be here in Albania. For Albania - Albania! - will be more pro-freedom, more pro-capitalist, and more pro-America than Obama's America.
I must confess I'm glad I'm here, watching a gorgeous Adriatic sunset and enjoying a sip of raki Albanian firewater in this fascinating place than amidst the insanity enveloping my country. But I also must confess that I can't make myself believe the insanity is real, that my countrymen will actually ruin themselves on November 4.
I can tell you that all of Eastern Europe is holding its breath and praying for a McCain victory. This part of the world has a nightmarish familiarity with Marxist tyranny and recognizes it when it's on the horizon. People here see it in Hussein Obama and desperately want him to lose. They want America to leapfrog over a return to Marxism like Albania experienced after a terrible economic collapse to the political and economic freedom Albania has now. That's the kind of Albania they want in America.
It sure is what Sali Berisha wants. He has met John McCain many times and has a very high regard for him. "I am looking forward to congratulating Mr. McCain on his victory, and inviting him to come to Albania" he told me. "I am a low-tax guy, and I want to show him what low taxes have done for Albanians. I want to tell him that low taxes can do the same for Americans." He raised his glass of raki. "God bless America, Dr. Wheeler," he toasted. "America is the hope of the world. May it always be."
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