Political support of the competition state in the Visegrád Four : The comprador service sector and its allies

A variety of foreign-led economies has emerged in Central and Eastern Europe in the late nineties. This paper explains the emergence of the competition state in the region and analyzes its political support and institutional underpinning. While the structural power of transnational capital and integration into the European regulatory framework had major roles in steering the state into the competitive direction, the externally oriented strategies were implemented only when both the structural opportunities and political possibilities of the moment allowed domestic groups linked to transnational capital to come to the fore in individual social formations. These social forces, the comprador service sector, became the nodal point and organizer of a wide coalition of forces centred around foreign investors — a power bloc promoting the competition state. attraction of foreign direct investment has become a priority throughout the region (Bohle, 2002; Bohle & Greskovits, 2006). State economic strategies in the Visegrád Four region (V4) have converged towards a distinct model of the competition states (see Drahokoupil, 2007d, 2007b). While strategies aimed at promoting national accumulation dominated the region up until the mid 1990s, in 1999, the V4 states found themselves competing for the favour of foreign investors. Inward oriented regimes had been transformed into the states that were fine-tuned to compete for mobile transnational capital. Why did this transformation happen? What is driving the competition state? What are the fields of force pushing the state strategies in the competition direction? What is the political and institutional support of the transnational strategy? The structural power of transnational capital and integration into the European regulatory framework had major roles in steering the state into the competitive direction. The economies in the V4 became structurally dependent on foreign capital, which controls access to technology, know-how, and major distribution networks. EU regulation gradually locked the state strategies in the competitive direction. The emergence of the competition state, however, cannot be understood without taking account of the agency of domestic social forces. Such forces must come to the forefront if " structural conditions " or " structural power " are meant to actually work; they cannot do without. The externally oriented strategies were implemented only when both the structural opportunities and political possibilities of the moment allowed domestic groups linked to transnational capital to come to the fore in individual social formations. These social forces, the comprador service sector, became the nodal point and organizer of …