[Kaiserschmarrn]

Who Likes Europe? Czechs Don’t—and That’s a Big Issue in October Elections

Billionaire Babis is poised to win by embracing euroskepticism.


Former Czech Finance Minister Andrej Babis on May 31.

Since joining the European Union 13 years ago, the Czech Republic has become the richest country in the formerly communist east, with a higher living standard than older members Portugal and Greece and the lowest unemployment in the 28-member bloc. Families travel freely, students study abroad, and businesses thrive by exporting to other EU countries. And yet Czechs are less excited than any other European nation about being part of the club: Only a third say that being an EU member is “a good thing”—lower than the crisis-stricken Greeks and the Brexiting Brits—and just a quarter or so want to adopt the euro, according to recent Eurobarometer surveys. “The EU doesn’t bring me anything,” says Pavel Ricka, a 38-year-old lawyer from Prague. “It’s headed by politicians with very socialist thinking. They want to regulate everything.”



That euroskepticism will shape general elections in October and threatens to nudge the Czech Republic toward the kind of isolationism sweeping neighbors Poland and Hungary. Opinion polls give a wide lead to Andrej Babis, a Slovak-born billionaire who crashed the Czech political scene in 2011 and has gained popularity by painting traditional parties as corrupt and incompetent. Like Donald Trump in the U.S., Babis has argued that his business acumen qualifies him to run the country, and he portrays himself as a doer: During his three years as finance minister, he rammed through a bill forcing businesses to link cash registers to the tax office via the internet, significantly improving tax compliance.

Babis remains popular despite the potential for conflicts of interest with a business empire that includes farms, chemical plants, two leading Czech newspapers, and a restaurant in the French city of Mougins that boasts two Michelin stars. A brewing corruption scandal—police say one of his farms illegally received EU subsidies, an allegation he denies—has done little to hurt his appeal to voters.

His party, ANO (Czech for “yes,” but also an acronym for Action of Dissatisfied Citizens), has attracted voters from both right and left, draining support from traditional parties. Babis, 63, doesn’t have quite the authoritarian streak of Hungarian Premier Viktor Orban or Poland’s Jaroslaw Kaczynski, but he mirrors their euroskepticism. He’s said the EU should set up Ellis Island-style immigrant detention centers in Tunisia and Turkey. He wants NATO to seal the bloc’s borders to keep out immigrants. And he’s voiced strong support for maintaining the koruna as the Czech currency. “We don’t want the euro here,” Babis says. The common currency “gives Brussels another area for meddling.”

Babis taps into a long-standing wariness of outsiders among Czechs, honed by traumatic histories with the Austro-Hungarian empire, Nazi aggression, and Soviet domination. “Czechs have always been suspicious of anything that seems to control them from the outside,” says Jiri Pehe, the director of New York University in Prague, who served as an adviser to President Vaclav Havel in the 1990s. “There’s a gaping historical wound in the Czech psyche.”

With the exception of Havel, the dissident playwright who became the country’s first post-communist president, Czech leaders have been at best lukewarm toward Brussels. Milos Zeman, the current president, has shown a greater affinity for Russia’s Vladimir Putin and China’s Xi Jinping than for fellow EU leaders. In July 2016, Zeman floated the idea of a referendum on membership, and he’s criticized German Chancellor Angela Merkel as being soft on immigration. Havel’s immediate successor, Vaclav Klaus—arguably the most influential Czech politician of the past three decades—has over the years shifted from grudging acceptance of EU rules to comparing the bloc to the Soviet Union. “We’ve prospered not because of EU membership but in spite of it,” the 76-year-old former head of state says. “The EU has become a dominant centralized power with very little autonomy for its members.”

Even the ostensibly pro-European ruling Social Democrats have opposed EU policies on refugees and adoption of the euro as they seek to shore up support. Foreign Minister Lubomir Zaoralek, who’s leading the party into the election, says the next government should focus on narrowing the gap with richer neighbors such as Germany before a shift to the euro. And he says the Czechs shouldn’t be required to accept refugees from border nations such as Italy and Greece. Still, he says, “the EU is our only chance. We won’t find anything better.”

The latest survey by polling agency Median shows the Social Democrats getting only 14.5 percent of the vote, trailing ANO’s 26.5 percent and just ahead of the pro-Russian Communist Party, with 13 percent. A decisive ANO victory could cement the Czechs’ anti-EU views at a time when bigger countries such as Germany and France are discussing a multispeed Europe, with core members pursuing greater integration. Its economic success notwithstanding, the Czech Republic risks finding itself on the bloc’s periphery, says Petr Just, a politics professor at Metropolitan University in Prague. “Lots of people think that since we’re doing so well already we don’t need the EU anymore,” he says. “They point to examples like Norway or Switzerland. But that’s an illusion.”

BOTTOM LINE - Rising euroskepticism threatens to turn Czechs away from the ruling Social Democrats, benefiting billionaire businessman Andrej Babis in October’s ballot.

I've corrected the irritating use of Europe instead of EU in my thread title.

With a Bloomberg article we get the usual Czechs are xenophobes and EU is salvation rhetoric. Best ignored.

I was surprised how negative Czechs and to a lesser extent Austrians are about the EU, e.g. both more negative than the UK. Of course, that doesn't necessarily translate into support for leaving, but it would be great if the Czech Republic and Austria would exit the EU in the future. I know it's not happening anytime soon, but a women can dream.

[Decky]

You Hapsburgs just want to rebuild your lost empire. I know your game Kaiserschmarrn! Having said that with the Turkish government being so islamist these days maybe it would be useful to have some sort of cannon fodder state to march against them just like in the good old days...

[foxdemon]

You might be right there, Decky. Kaiserschmarrn is still peeved about old Fritz seizing Bohemia during the confusion of the Austrian Succession. Here is the chance to take it back. My advice to the Austrians is to make an alliance with the Russians to check the power of the Frankish/Prussian/EU/continental system/Fourth Reich/Holy Roman monstrosity. Though I will concede Putin doesn't have balls anything like Catherine did, so the Russians might not be as useful as they were against Old Fritz.

[Rugoz]

From 80% approval in Ireland to 30% approval in the Czech Republic. Quite a span.

[Kaiserschmarrn]

You Hapsburgs just want to rebuild your lost empire. I know your game Kaiserschmarrn! Having said that with the Turkish government being so islamist these days maybe it would be useful to have some sort of cannon fodder state to march against them just like in the good old days...

A Brit would of course think that I have ulterior motives. Projection?

You might be right there, Decky. Kaiserschmarrn is still peeved about old Fritz seizing Bohemia during the confusion of the Austrian Succession. Here is the chance to take it back. My advice to the Austrians is to make an alliance with the Russians to check the power of the Frankish/Prussian/EU/continental system/Fourth Reich/Holy Roman monstrosity. Though I will concede Putin doesn't have balls anything like Catherine did, so the Russians might not be as useful as they were against Old Fritz.

Heh, I'm even more peeved that the Prussians got Bavaria and Baden-Württemberg!

From 80% approval in Ireland to 30% approval in the Czech Republic. Quite a span.

The difference between Ireland and the Czech Republic is even more remarkable, because Ireland hasn't had anywhere near 30% economic growth since 2004. They recorded GDP growth around 26% in 2015 alone.

Ireland’s GDP figures: Why 26% economic growth is a problem

The growth rate may be statistical fact but it is a fiction in reflecting what is actually going on.

[...]

Growth figures distorted by activity in four key areas

Contract manufacturing

The term refers to a form of outsourcing whereby companies, usually big multinationals, engage other entities abroad to manufacture components or products on their behalf.
The fragmentation of the production chains across multiple jurisdictions has become an increasingly common feature of globalisation and makes national accounting very complicated. Irish export volumes have been artificially inflated by contract manufacturing for several years. The Central Statistics Office does not disclose anything about the organisations involved, but the assumption is that we are dealing with a handful of firms in the pharma and tech sectors.
The Government’s own fiscal advisory council first raised concerns it was distorting our headline GDP metric back in 2014. The International Monetary Fund also queried the strength of Ireland’s economic growth in 2015, which was 5 per cent at the time, noting it is being exaggerated by two pharma firms involved in contract manufacturing. Back then, it was suggested it was flattering growth to the tune of about 2.5 per cent. Last year, it appears to have been an even bigger factor. In the past, offshore product or component was returned to Ireland to be packaged, meaning it would turn up as imports, effectively neutralising the effect on trade numbers. However, more recently the product doesn’t appear to entering the domestic economy at all. It was described as a significant component of the 102 per cent jump in net exports in 2015, significantly augmenting the value of economic growth but perhaps not representing a true picture of activity.

Tax inversions

These deals typically involve US companies acquiring a foreign-based firm and relocating their headquarters to where these firms are incorporated. The “inversion” term is used because the company outside the US is typically smaller but often the deal is dressed up to make it look like the smaller entity is acquiring the bigger one when the reverse is the case. The US company thus moves its domicile outsider the US, although typically its operations and management remain there, albeit there is a ripple on the national accounts here. Companies undertaking this strategy are likely to select a country that has lower tax rates, hence the popularity of Ireland. One deal thought to be a factor behind the bounce in Ireland’s GDP involved US medical device firm Medtronic, which moved to Ireland through a merger with rival Covidien in a deal worth $48 billion. US botox maker Allergan also transferred its headquarters to Ireland via a reverse takeover of Irish-based drug maker Actavis in a deal worth $66 billion. A spate of such deals since 2014, roughly in tandem with international efforts to tackle multinational tax avoidance, eventually led to a clamp down by the US treasury. The US action derailed the “superinversion” Pfizer-Allergan deal, keeping the US company’s headquarters in New York instead of Dublin. The inversion deals may overlap with the contract manufacturing element of our accounts as some of the firms involved appear to have large offshore manufacturing operations.

Relocating patents

The transfer of international patents or intellectual property assets from one jurisdiction – typically a tax haven – to another appears to be a direct response to the OECD-led clampdown on multinational tax avoidance. Apple and a handful of other tech companies recently transferred IP assets to Ireland, effectively booking a much greater share of profits through the State. This may go some way to explaining the bumper level of corporate tax receipts currently coursing through the exchequer’s accounts. A common way to shift profits offshore is through transfer pricing, which was central to the now discontinued double Irish arrangement. This involves multinational subsidiaries in different countries charging each other for goods or services sold within the group. It is most associated with tech and pharma companies where the businesses are underpinned by intellectual property, the value of which is subjective. Royalty payments between subsidiaries are priced in a way to minimise profits in high-tax countries and maximise them in low-tax ones. The international outcry over this, however, has led several big multinationals to quietly rearrange their tax affairs, effectively moving their IP out of more obvious tax havens and into low-tax jurisdictions such as Ireland, massively boosting the State’s capital assets.

Aircraft leasing

Investment in aircraft for leasing can result in large additions to the domestic capital stock. One deal suspected of contributing to the bubble in Irish GDP involved leasing firm Aercap, which last year redomiciled the bulk of its €39 billion in assets in the Republic as part of its takeover of rival firm International Lease Finance Corporation. The inclusion of aircraft leasing activities in the national accounts only began last year and it seems already to have had a seriously distorting effect on the breakdown of the national accounts and some impact on the bottom-line growth figures. Ireland is a global hub for aircraft leasing, with approximately 4,000 commercial aircraft leased through companies here, representing a total value of $115 billion. Changes to accounting conventions will now see the purchases of aircraft included as imports. “As well as making the data on exports and imports difficult to interpret, this will also make the policy implications of changes in the current account of the balance of payments more obscure,” economist John FitzGerald says.

[Rugoz]

They recorded GDP growth around 26% in 2015 alone.

Wow!! how the fuck did that happen

In any case, in the case of Ireland it makes sense to look at GNP instead of GDP, because it's such a big difference.

[Decky]

Heh, I'm even more peeved that the Prussians got Bavaria and Baden-Württemberg!

I agree, Catholic Germany and Protestant Germany should be two separate nations, one with a capital in Vienna and one in Berlin. I makes no sense at all having Austria as small as it is now. This is not the ideal of course but a first step, in the long run Protestantism needs to be wiped out to the point it has so little influence on the world that it will only be of interest to historians.

[Kaiserschmarrn]

Wow!! how the fuck did that happen

In any case, in the case of Ireland it makes sense to look at GNP instead of GDP, because it's such a big difference.

When the GDP figures came out in 2016 people used the term "leprechaun economy" to describe it.

GNP is much better but still influenced by some of the same issues. See here if you are interested.

Before adjustment:



After adjustment for re-domiciled PLCs and aircraft leasing:


I'm sure Ireland is not the only country that sees distortions but the difference seems quite large in Ireland's case.

I agree, Catholic Germany and Protestant Germany should be two separate nations, one with a capital in Vienna and one in Berlin. I makes no sense at all having Austria as small as it is now. This is not the ideal of course but a first step, in the long run Protestantism needs to be wiped out to the point it has so little influence on the world that it will only be of interest to historians.

My main issue is that it's Prussia's fault that the world thinks Germans have no humour.

[foxdemon]

When the GDP figures came out in 2016 people used the term "leprechaun economy" to describe it.

Gold at the end of the rainbow.

My main issue is that it's Prussia's fault that the world thinks Germans have no humour.

Don't stress Kasierschmarrn. We didn't come down in the last shower. Danes are laid back, the Bavarians and Austrians are chilled, Bohemians (I hope the Czechs don't mind that term) are cool. We all know who the problem is.

[fokker]

You Hapsburgs just want to rebuild your lost empire. I know your game Kaiserschmarrn! Having said that with the Turkish government being so islamist these days maybe it would be useful to have some sort of cannon fodder state to march against them just like in the good old days...

You Brits need to acknowledge Europe has been a victim of your power games in 20th century. But now you are an object of Europe's power games.

With hindsight it seems destroying the Austrian empire was a mistake as the idea of smaller nations working together got resurected but in much bigger scale. With Austrian and German empires still existing, it perhaps would have never happened on todays scale. You brought it on yourselves.

[Political Interest]

You Brits need to acknowledge Europe has been a victim of your power games in 20th century. But now you are an object of Europe's power games.

But realistically speaking the German power games were equally infantile. If Germany had realised it's General Plan Ost there would be no more Slavic people. Then all of Europe would have been a victim of German power games. England and Germany are some of the most destabilising countries in Europe.

[Kaiserschmarrn]

You Brits need to acknowledge Europe has been a victim of your power games in 20th century. But now you are an object of Europe's power games.

With hindsight it seems destroying the Austrian empire was a mistake as the idea of smaller nations working together got resurected but in much bigger scale. With Austrian and German empires still existing, it perhaps would have never happened on todays scale. You brought it on yourselves.

That's not entirely accurate I think. Europe has been the victim of the power games of all great European powers. To expect Britain to sit idly by while Germany as a potential equal power rises on the continent would be just as unrealistic as expecting Germany to not try and rival Britain and the other great powers. Germany wasn't only focusing on Europe but was building its power projection capabilities through its navy too. So I think Britain viewing Germany as a threat was as legitimate as Germany not accepting that Britain should rule the seas and much of the world.

I don't think the arrangement after WWI can be solely or even predominantly blamed on Britain either. Some of it were rewards for alliances, nationalism also played a role and those countries that bore the brunt of the fighting on their soil insisted on payback.

Anyway, are you from the Czech Republic, fokker? If so, would you agree with the article regarding the sentiment towards the EU in your country?

[fokker]

If Germany had realised it's General Plan Ost there would be no more Slavic people.

20th century in Europe has been decided by WW1 as WW2 was an attempt to restart and win that war. Without German loss in WW1 you won't get WW2, not in the way it happened. In WW1 goals were quite fair and reasonable. General Plan Ost came only with Hitler. Germans got fooled once by a populist and an extremist hard liner, thats probably why they don't trust populists anymore. All politicians have their own agenda. Their newspapers also don't seem to be informing people about refugee attacks.

I don't think the arrangement after WWI can be solely or even predominantly blamed on Britain either. Some of it were rewards for alliances, nationalism also played a role and those countries that bore the brunt of the fighting on their soil insisted on payback.

Brits liked to meddle into things to take part in final decisions. While you can't blame the post WW1 arrangements solely on Britain as they weren't the only ones making decisions, you can blame the the loss of the war on them. They couldn't be invaded or defeated on sea. Their industry (rifles, ammunition, airplanes, tanks) and resources (man power available from the whole empire) significantly tipped the scale in favor of Entente. Without them France most likely collapses and as a result you don't get EU as Germany would be too powerful and smaller European countries (northern, Italy, Spain) not wanting to be its puppets.

My claim is that by weakening Germany, this Britain's achievement lead to the birth of the EU, even worse situation than a strong Germany for Britain. Now the EU is laughing from the little Britain and their brexit.

Anyway, are you from the Czech Republic, fokker? If so, would you agree with the article regarding the sentiment towards the EU in your country?

I agree with that article, it's accurate. Most people in Czech Republic are euro skeptic, don't want euro or more integration. Social democrats are incompetent and weak, they can't go against public opinion. Lubomir Zaoralek is incompetent just as his predecessor Sobotka (funny there are Sobotkas in Austria too). They can't succeed. The times of strong social democrats are over. High popularity of Andrej Babis can be atributed to people getting tired of corrupt politicians, puppets who serve hidden lobyists. A politician that is so rich has his own mind and doesn't serve lobyists. He has his business interests in mind through, so the country can't move in the direction of Hungary or Poland.

[Rugoz]

Now the EU is laughing from the little Britain and their brexit.

The UK is the second largest economy in the EU, in a better shape than France and in a far better shape than Italy. The EU isn't laughing.

A politician that is so rich has his own mind and doesn't serve lobyists. He has his business interests in mind through, so the country can't move in the direction of Hungary or Poland.

So he doesn't serve lobbyists but only his own business interests. What an improvement . At least when serving lobbyists politicians serve a large share of the economy.

[Buzz62]

Ya OK...My wife IS Czech, my daughter was born in Prague, and I lived there for 10 years.
I can tell you that the "impositions" of the EU have been ridiculous and heavily weighted to benefit Germany.
For instance, the stupid regulation that says the traditional Czech rum, can no longer be called "Rum".

Czechs will guard their nation and culture from outsiders who want to either pollute it, or change it.
I see nothing wrong with that.

[fokker]

The UK is the second largest economy in the EU, in a better shape than France and in a far better shape than Italy. The EU isn't laughing.

If we compare UK GDP to that of the EU we can quickly see who is "little" and who has how much negotiation weight.

So he doesn't serve lobbyists but only his own business interests. What an improvement . At least when serving lobbyists politicians serve a large share of the economy.

It doesn't seem so far. These people have to be kept under control but they are good managers. These are not some dumb MBA managers who switch companies every 2-3 years. Far better than incompetent socialists who never had any real job outside politics and depend on lobyist contributions to their offshore bank accounts. I'm not his supporter though.

Btw did you guys know the leader of AfD in Bavaria is Czech? Petr Bystron emigrated to Germany in 1987.

[Heisenberg]

I'm glad we're at least at the stage now where people are prepared to admit openly that the EU is in fact "the continuation of Germany by other means", as Peter Hitchens puts it. It must have been exhausting having to pretend it's really about the good of all member states, rather than German dominion over them.

[Beren]

I'm glad we're at least at the stage now where people are prepared to admit openly that the EU is in fact "the continuation of Germany by other means", as Peter Hitchens puts it. It must have been exhausting having to pretend it's really about the good of all member states, rather than German dominion over them.

So do you believe German dominance excludes the possibility of all member states profiting from the EU and it must be a zero-sum game benefiting Germany and maybe some others only?

[Heisenberg]

Not necessarily. But then, until very recently, most people feigned horror and outrage when our side suggested the EU was in fact a German imperial project. Now, at least, they admit it.

For what it's worth, I don't think it's wholly a bad thing. German domination over continental Europe has been more or less inevitable since 1871, and at least the EU allows it to happen (mostly) peacefully.

[Kaiserschmarrn]

20th century in Europe has been decided by WW1 as WW2 was an attempt to restart and win that war. Without German loss in WW1 you won't get WW2, not in the way it happened. In WW1 goals were quite fair and reasonable. General Plan Ost came only with Hitler. Germans got fooled once by a populist and an extremist hard liner, thats probably why they don't trust populists anymore. All politicians have their own agenda. Their newspapers also don't seem to be informing people about refugee attacks.

Brits liked to meddle into things to take part in final decisions. While you can't blame the post WW1 arrangements solely on Britain as they weren't the only ones making decisions, you can blame the the loss of the war on them. They couldn't be invaded or defeated on sea. Their industry (rifles, ammunition, airplanes, tanks) and resources (man power available from the whole empire) significantly tipped the scale in favor of Entente. Without them France most likely collapses and as a result you don't get EU as Germany would be too powerful and smaller European countries (northern, Italy, Spain) not wanting to be its puppets.

My claim is that by weakening Germany, this Britain's achievement lead to the birth of the EU, even worse situation than a strong Germany for Britain. Now the EU is laughing from the little Britain and their brexit.

It's hard to say whether the goals were reasonable, as they changed throughout the war on all sides. I think it's fair to say that both Germany and France wished to crush each other to the extent that the other couldn't become a rival anymore. When victory seemed possible, goals tended to become more ambitious, although most of them were never publicly declared.

In hindsight it may seem a better strategy for Britain to stay out of the war, but not at the time. A German hegemon on the continent with colonial ambitions would have been a possible outcome, and this wasn't completely unfounded (see for instance German goals in Africa). Why would Britain assume that a victorious Germany wouldn't be a threat, seeking to establish military and economic hegemony in Europe and also looking further afield? It must have seemed far preferable at the time to prevent this possibility in the first place.

I agree with that article, it's accurate. Most people in Czech Republic are euro skeptic, don't want euro or more integration. Social democrats are incompetent and weak, they can't go against public opinion. Lubomir Zaoralek is incompetent just as his predecessor Sobotka (funny there are Sobotkas in Austria too). They can't succeed. The times of strong social democrats are over. High popularity of Andrej Babis can be atributed to people getting tired of corrupt politicians, puppets who serve hidden lobyists. A politician that is so rich has his own mind and doesn't serve lobyists. He has his business interests in mind through, so the country can't move in the direction of Hungary or Poland.

There are plenty of Slavic names in Austria. Names ending with -itz or -ütz are often Germanised version of a Slavic name ending with -ice or -yce. It's interesting that Slavic names seem to be more often based on location, e.g. I think that's true for Sobotka, whereas the most common German names are almost always based on professions.

As for business interests, Bloomberg also has an opinion piece advising Eastern Europe that resistance is futile:

How Western Capital Colonized Eastern Europe

Populist politicians are too late with their nationalist messages.


The East's populists.

Yet another Eastern European country is about to get a populist, anti-immigration, euroskeptic government: Billionaire Andrej Babis's ANO party enjoys a wide poll lead ahead of the October parliamentary election in the Czech Republic. The central European country would join Poland, Hungary and Slovakia. If that sounds ominous, there is at least one bulwark against extremism in the region: Western European capital.

Indeed, Western investment plays such an important role in economies of all these countries that nationalist politicians make their countries look more like truculent colonies than partners in a grand integration project.

In a recent paper, Filip Novokmet, Thomas Piketty and Gabriel Zucman bluntly call Eastern European nations "foreign-owned countries."

"The owners tend to come from EU countries (in particular from Germany)," they write. "So in some sense it is not entirely different from the situation of peripheral regions that are being owned by more prosperous central regions in a large federal country." To Piketty and collaborators, this is a nuisance because it distorts inequality measurements: Much of a country's wealth and income accrues to foreign shareholders who do not belong to the local top one percent, so the country looks more egalitarian than it actually is. But it also has broader implications.

Relative to their economic output, Eastern European nations have the biggest negative net investment positions in the EU, unless one counts Ireland, Greece, Cyprus, Portugal and Spain -- all recipients of big bailouts during the recent financial crisis.

Unlike the crisis-hit "PIGS," the nations of Eastern Europe developed these positions by consistently attracting more investment then they sent out. The foreign investment stock in these economies, relative to gross domestic product, is higher than the developed-country average.

Such levels of investment used to make these nations proud, showcasing their openness and their heartfelt desire to integrate into the wealthier part of Europe. But, until the EU was buffeted by economic storms, these nations didn't fully realize that becoming "foreign-owned" has costs too.

Local companies found out during the financial crisis that the foreign banks were the first to shrink loan origination. In other sectors, a large foreign presence means a huge unemployment threat if a country suddenly becomes less welcoming to foreign capital. In Poland and the Czech Republic, a third of the workforce is employed by foreign companies. And these tend to be the biggest, most economically important companies, too: In Poland, they produce two-thirds of all exports; in the Czech Republic, they are responsible for 42 percent of value added. Losing even a few of these firms could cause a painful reversal of economic trends, something Babis, a businessman and former finance minister, understands well.

Germany, the Netherlands and France are the biggest investors in the Eastern European economies. The advantages of investing in the region are obvious for these countries' firms: They can lower labor costs without moving production too far from their traditional markets or compromising on the protections they have at home. Populist governments can hit foreign banks and supermarket chains with special taxes, as Hungarian Prime Minister Viktor Orban and the Polish government have done and as Babis is likely to do if he comes to power, but only to a point; go too far and foreigners might decide to exit, leaving these relatively small economies in the dumps.

The Hungarian, Polish and Czech governments can resist European directives on refugee resettlement and posture defiantly when their efforts to take over the courts are challenged: "We will not be a colony," Orban and Polish ruling party leader Jaroslaw Kaczynski have told EU officials on separate occasions. That, however, won't change their de facto status as economic colonies of the wealthier West, unless the populist governments move to expropriate the foreign companies -- an unthinkable development.

Milos Zeman, the Czech Republic's populist president, said recently that it might be better to lose EU subsidies -- something Western Europeans have threatened -- than be forced to accept Muslim migrants. But the loss of aid is not the real threat; that would be foreign businesses' unease about a changing business climate. Fracturing EU cohesion -- and especially defying EU courts, which uphold the union's policies -- could in time lead to that because it would lessen the protection of Western European investors. Orban, who has been in power longer than his ideological allies in neighboring countries, understands that well: He has repeatedly softened policies as a result of European court rulings. Orban hasn't directly challenged the recent decision by the European Court of Justice that obliged Eastern European countries to take part in the bloc's refugee resettlement scheme.

The nationalist rhetoric may fool some voters into thinking their leaders are truly independent. But the choice politicians in Eastern Europe ultimately face is stark: Either they content themselves with mainly fig-leaf rebellion, or they raise the stakes and risk losing investment on which their economies depend.

It's not really a choice; Eastern Europe will eventually need to champion integration, just as it once championed membership. My own view is that eventually, it will no longer matter where a European company is headquartered because a united Europe will have a common budget, and economic cohesion will become inevitable. Nationalism may be having a moment, but it's too late: The Eastern European countries have been open to investors for too long, and they've lost too much control over their economic future to hold on to political control.

These people really have no shame. First it's all about win-win and how everybody benefits. Then it become dependence, colonisation and inevitability. No country can be open to foreign investors unless it is in the EU and subscribes to ever more integration, and once colonised there is no way back. Obviously, Eastern Europeans will never manage to invest in their own countries, they'll always be some kind of appendix of Western Europe. Just so you guys know your place.