Wages were severely slashed. Benefits largely disappeared. Economic deprivation left vast numbers "severely materially deprived."
Fo ordinary people, crisis conditions persist. Anyone out of work on earning subsistence or sub-poverty pay understands what's going on better than talking-head economists.
Many people left and won't return. They include some of Latvia's best and brightest. Why endure IMF harshness.
Riga-based Stockholm School of Economics Professor Morten Hansen said Latvia's unusually open economy enabled relentless wage and benefit squeezing.
"You can only do this in a country that is willing to take serious pain for some time and has a dramatic flexibility in the labor market," he said.
In other words, it's only possible where workers have no rights, those most vocal and angry leave, and others know resistance faces stiff crackdowns. It's also easier perhaps in tiny countries. Larger ones are harder to control.
Hansen added that "The lesson of what Latvia has done is that there is no lesson."
Jeffrey Sommers and Michael Hudson addressed Latvia. Their article is titled "Latvia's Economic Disaster as a Neoliberal Success Story: A Model for Europe and the US?"
Latvia is today's "most highly celebrated anti-labor success story," they said. It's called a country "where labor did not fight back, but simply emigrated politely and quietly."
Workers endured austerity instead of resisting, it's claimed. Many voted with their feet and left. Most remained and suffered. Tax burdens are "decidedly on (their) backs"."
Latvia is praised for being "business friendly." It comes at a high price. It reflects 19th century harshness. It's a cruel unacceptable social experiment.
The New York Times article is discussed. Human misery is called the "Latvian Miracle." The newspaper of record "has fallen in line with the surrealistic Orwellian attempts to depict Latvia's austerity and asset stripping as an economic success"."
Wages and benefits are stripped to the bone. Workers endure unconscionable tax burdens. Real estate interests get off lightly. So do capital gains and other business-friendly initiatives.
Latvia became "de-industrializ(ed), depopulat(ed) and de-socializ(ed)." It's a model dystopian state. It became a "Protestant morality play."
"(S)toic Balts confront(ed) crisis" by avoiding "histrionics (and) getting busy with work." These type notions appeal to "smug middle-class prejudices and stereotypes in countries whose populations have not had to suffer economic experiments in neoliberal horror."
"Anyone with actual experience in Latvia will see the dissonance between myth and reality regarding the government's response to the crisis."