Transition  Crime   


by Matthew Weinshel

Illegal and unethical activities continue to plague Eastern Europe's economies. Although East Europe has begun the transition from the Soviet-type Command Economy to a free-market system, many of those governments have failed to legislate, produce regulations, and enforce any effective laws. Organized crime has filled the legislative vacuum in such places. Some activities, defined as illegal in the Soviet-type system, may or may not continue to be illegal in the free-market type economy. However, the transition from one system to another has created new, challenging problems for officials, for which they remain quite unprepared. Romania has experienced some unique results to its transition; the proximity of the Soviet Union has especially hurt its transition.

In the Romanian economy, the Marxist government was and still is the employer of a majority of its citizens. In such a situation the major illegal activities consist of the theft of time, raw materials, semi-finished products, and finished products from state enterprises by their employees. Workers would come into work late, fail to actually work, and steal materials for private use or illegal production at home. Conductors or bus drivers also sold transportation tickets without turning revenues over to the state-owned transportation firm. Conductors and passengers split the proceeds between themselves. The conductor would simply fail to issue an official ticket and passengers would pay a discounted price.

Often there were black market sales in exchange for extra money or services rendered by the buyer. Government officials could be bribed to obtain an access to goods and services that were scarce in the "legal" economy. Toward the end of the centrally commanded economy era, Romanians also traded a tremendous amount of convertible currency on the black market.(1)

Much of the "illegal" activity in the former Soviet-type economy of Romania resulted from the lack of incentives of the system. Although the system probably distributed goods and services more equally, no worker or manager ever seemed to pull ahead through hard work and dedication to the functioning of that system. It was much more profitable and comfortable to sell on the black market products that were produced either in the "official" economy or that were produced unofficially or illegally. In addition, Marxist economies maintained a soft budget constraint. Businesses would be subsidized in the event of financial loss. The soft budget constraint greatly enhanced opportuninties for intraenterprise theft and cheating. It also decreased monetary value of Romanian currency. People quickly learned that they could reap high profits by trading "hard currencies" on the black market.

The transition also provided some new approaches to illegal activity. Many of these activities plague Western governments as well as the other East European countries but Romania's geographic location and lower level of development aggravates the problem. Recently, officials have expressed concern over five major issues: drug trafficking, nuclear material smuggling, automobile theft, illegal immigrant smuggling, and the organization of Mafia gangs or crime families. Officials from the Czech Republic, Slovakia, Bulgaria, Poland, Romania and Hungary met to sign the latest "Berlin Declaration." This declaration promised cooperation among the former Eastern Bloc nations."...[They] promised no delays in returning illegal immigrants to officers, to share experience in the field of forensic policing and use compatible technical procedures [to catch traffickers.]"(2)

The Berlin Declaration also called for cooperation over "controlled deliveries," which make it possible for officials to catch traffickers. These states agreed to install equipment in ports and airports to detect radioactive goods. However all officials present agreed that the radioactive materials that had been seized came directly from the former Soviet Union. Art of smuggling has also increased as organized criminals realized that many of the former Eastern Bloc nations contained lost treasures in its public museums and state houses. Auto thefts have drastically increased, especially with the new freedom of travel and the influx of Western tourits and businessmen.

In Romania, a police report said that the crime rate was about 3.9 per cent higher in 1992 than in 1991 and that the police investigated more than 6000 corruption cases, which was 22 per cent more than in the previous year.(3) Although this increase does not seem high, it is important to note that the Romanian government still remains hesitant to reveal too much negative information about the country. It wants to prevent a loss of public support for the transition. In addition, many of the crimes that seem rather new to the Eastern Bloc nations have remained undetected to governments ,officials. Many of the criminals are internationally connected and many have more power than any government official after .

According to Romania's Interior Minister, "In the conditions of a legislative vacuum, new types of crimes have proliferated in Romania: narcotics and human beings smuggling, illegal immigration connections, stolen car trafficking, while in the last period Romania was traveled by nuclear products smugglers."(4)

The main question remains: Why has Romania and the other former Eastern Bloc nations experienced such an increase and change in crime patterns? One of the reasons results from geography. Romania's proximity to the former Soviet Union plagues it with a double-negative effect. First, Romanians have more difficulties with imports and exports to the west because of Romania's location and high transportation costs. Second, the increase in Soviet Mafia has spread to include passage through Romania as well as cooperation with Romanian Mafia.

"The opening of borders has meant a huge rise of the number of people, vehicles and goods getting in and out of Romania. This situation was used by the trafficking rings using Romania as a `bridge pillar' making the link between East and West..The foreign rings of organized crime send messengers to establish links with Romanian criminals."(5)

Another reason for Romania's crime spree during and after the transition arises from the criminals filling the legislative "vacuum." Although the Communists lost power and free-market advocates took power, the new government certainly never commanded the same type of respect or fear. The power vacuum had to be filled, and organized criminals filled it. The last reason for the increase in organized crime stems from the new market-type system itself. Romania has simply not developed as much as many other states. Its economy and consumers relied heavily on subsidies and social welfare to maintain a low, but adequate standard of living. Romanians have suddenly been placed into a system where they must earn their living and jobs become scarce with increased market efficiency. Market forces reward those who are willing to work hard, but many Romanians have become frustrated, especially in the early part of the transition, when prices were liberalized. Romanians do not have much to lose by engaging in illegal criminal activity, but they stand to gain a great deal.

Although most of the world applauds Romania's transition to a free-market, it has not been easy for the average citizen or legislatures. Less jobs exist as the system loses its subsidies and the economy becomes more efficient. The young government does not command the same respect or authority as the authoritarian, and cruel, central command government. Many Romanians have simply observed the disadvantages of working toward a financial goal and taking financial risks. They would prefer to make money quickly and organized crime seems to be the most powerful and attractive option available.




  • (3)Timothy Heritage, "East Europe Struggles Against Crime," THE REUTER BUSINESS REPORT, January 5, 1993.

  • (4)"INTERIOR MINISTER VIEWS GROWTH IN ORGANIZED CRIME," Romanian Press Agency news agency, Sept. 12, 1994.

  • (5)Ibid.


  • "EU Joins Forces with Eastern Europe Against Organised Crime." European Social Policy. Sept 15, 94.

  • Heritage, Timothy. "East Europe Struggles Against Crime." The Reuter European Business Report. Warsaw. January 5, 1993.

  • "Interior Minister Views Growth in Organised Crime." Romanian Press Agency, Bucharest. 12 Sept 94.

  • Los, Maria. THE SECOND ECONOMY IN MARXIST STATES. St. Martin's Press, New York, 1990.



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