The Fall and Rise and Fall Again of the Baltic States

After regaining independence in the early 1990s, the Baltic countries could easily have turned out like Moldova: semifailed states on Europe’s periphery, corrupt, geopolitically hamstrung, and surviving on remittances. Their foreign trade was entirely tied to the collapsed Soviet economy. They had no independent institutions and no civil servants capable of running a modern state. Their politicians were a mix of wily but untrustworthy Soviet holdovers, unworldly professors (Lithuania’s first post-Soviet president, Vytautas Landsbergis, was a musicologist), and inexperienced youngsters (Juri Luik, Estonia’s representative to nato, entered high office at 26). All the while, the kgb used its cash, connections, and intimate knowledge of "the lives of others" to preserve and expand its influence—a task made easier by the unsolved question of how to deal with the hundreds of thousands of Soviet-era migrants and their descendants.

That combination of problems meant that few saw the Baltic states as future members of serious Western clubs. They were too flaky for the European Union, too geopolitically sensitive for nato, and too poor for the oecd. And many in the West told them so. As the Cold War wound down, Baltic leaders aspiring to independence received not warm words of encouragement from the West, but rebukes. Why were they so impatient? Why were they impeding Soviet leader Mikhail Gorbachev’s reforms with their hard-line nationalism? A Finnish official even told me once that Estonian independence would be an economic and political disaster that would prove a "catastrophe”—for Finland! Such points went down badly in the Baltics, and not surprisingly. It was akin to telling a prisoner to consider his captors’ feelings, rather than trying to escape.

So how did the Baltic countries do it, succeeding so brilliantly and so quickly? Part of it was luck: Russia was weak, and its potential for mischief was initially quite limited. In addition, the Baltic diasporas provided a serendipitous assortment of unlikely leaders. Lithuania’s president, Valdas Adamkus, spent most of his life as a civil servant in the U.S. Environmental Protection Agency. His Estonian counterpart, Toomas Hendrik Ilves, was raised in the United States and educated at Columbia University. Former Latvian President Vaira Vike-Freiberga spent most of her life in Canada as a psychology professor. Hundreds of lesser-known others in the 1990s helped rebuild everything from the diplomatic service to business.

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