Book review

European Business Review

ISSN: 0955-534X

Article publication date: 1 December 2004


(2004), "Book review", European Business Review, Vol. 16 No. 6.



Emerald Group Publishing Limited

Copyright © 2004, Emerald Group Publishing Limited

Book review

A question of scale

David BeattieLiechtenstein: A Modern HistoryI.B.Tauris LtdLondon2004399 pp.ISBN 1-850-43-459-X

Speakers' Corner is an area of London's Hyde Park, close to Marble Arch, which is the site of the notorious Tyburn, place of public hangings. What was once a place of blood sacrifice and a symbol of oppression is now, ironically, a shrine to freedom of speech. For at Speakers' Corner, men and women of all manner of backgrounds and interests declaim from soapboxes to passing crowds. It is a place where, by convention, every point of view, however, eccentric or unpopular, is freely expressed. I recall that on a visit to Speakers' Corner as a schoolboy, I found amongst the assorted anarchists, vegans and religious sectaries an Indian gentleman with an acerbic wit and bitter anger against an unwelcoming Britain. When one man in the crowd revealed that he came from Liechtenstein, the Indian dismissed him with: "Oh, that tiny dot in the middle of Europe". The crowd roared with laughter.

The story of Liechtenstein is that of evolution from backward agrarian province buffeted by powerful neighbours to wealthy principality, financial and high-tech centre and active member of the Council of Europe, European Economic Area and United Nations. It should convince any reader that "tiny dots in the middle of Europe" (or anywhere else for that matter) are not to be sneered at. However, there is a curious sense in which Liechtenstein's development mirrors that of Speakers' Corner. The small, landlocked state also has a bloody history of invasion, feuds, executions and witch hunts. It is only in the last two hundred, and especially the last fifty, years that Liechtenstein has become a secure modern democracy underpinned by powerful local traditions. Speakers' Corner, at its best, is an example of participatory democracy in action. In Liechtenstein, a state of 32,000 souls, participation is also important, as shown by the referendum, influenced by republican Switzerland next door. Liechtenstein has survived because its resourceful inhabitants have learned, over the centuries, to absorb the best influences of its powerful neighbours and give them a distinctive local flavour. At the same time, Liechtenstein has learned to recognise and sift out threatening or undesirable influences, which is why it avoided the tyranny and irrationality of Nazism. In its avoidance of totalitarianism, and its gentle but determined preservation of its identity, Liechtenstein is one of the 20th century's greatest success stories.

Liechtenstein is, therefore, less a dot and more a point of intersection between different aspects of Europe: North and South, neutral and aligned, traditionalist and modern, egalitarian and hierarchical. It is not even wholly Germanic, for the Latinate Romansch language still influences the state's distinctive dialect. David Beattie, who has served as British Ambassador to Switzerland and Liechtenstein, has provided a thorough and comprehensive survey of Liechtenstein, its history and its modern economy and political culture. He begins the book with an epigraph from Aristotle's Politics:

  • Most men think that the happiness of a state depends on its being great. They may be right; but even if they are, they do not know what it is that makes a state great or small. They judge greatness in numerical terms, by the size of the population; but it is capacity, rather than size, which should properly be the criterion.

The reference to Aristotle is appropriate, as Beattie, being a classicist, will know. Modern Liechtenstein resembles closely the "mixed constitution" advocated by Aristotle, which balances monarchic and oligarchic principles with those of direct democracy. He was conscious of the need to balance permanence and change, and would probably believe that Liechtenstein had achieved this balance, after some trail and error.

Aristotle was writing at a time when the Greek city states were expanding and he saw this expansionism as a political mistake, reducing the state's sustainability and creating dangerous divisions between rulers and ruled. He had an organic view of the state, and argued that its size has natural limits, like the sizes of "plants and animals". This theme of natural limits is taken up by Sir Richard Body in his book The Breakdown of Europe (New European Publications, 1999), in which he argues that the European ideal is better realised through an emphasis on variety and decentralisation, instead of the monolithic tendencies of the present EU. Sir Richard is strongly influenced by E.F. Schumacher (Small is Beautiful) and more particularly by Leopold Kohr (The Breakdown of Nations). Both books, Kohr's especially, are influenced by Aristotle's Politics. Kohr and Schumacher were responding to an age in which, as in Aristotle's day, growth was equated with progress and enlightenment. This idea extended well beyond the size of states or confederations to economics, urban planning, architecture and education - indeed to all areas of "civilised" life. Schumacher focussed his critique of growth on economics, whilst Kohr concentrated on statecraft. In the same mid-late 20th century epoch, Rachel Carson and Jane Jacobs applied the same critique to environmental policy and urban planning. In all these areas, it was becoming apparent that the emphasis on expansion was not progressive but destructive. It was making us lose our sense of the human scale, and hence our respect for our fellow human beings and ourselves. More dangerously still, perhaps, it threatened the delicate balance between humanity and nature.

Liechtenstein, according to Mr Beattie's account, would seem to be an exemplar of the "small is beautiful" school of thought. It has a flourishing local economy, industrial and agrarian, an open society, modified by a sense of shared values, and has avoided environmental despoliation. From this, it would be easy to jump to an idealised view of small states. To do this would be mistaken, unfortunately, and would be a mere reversal of the growth-is-best fallacy. Many small states, Haiti, for example, have consistently tragic histories. In others, such as Uruguay, an apparent idyll is destroyed by external pressure and internal contradictions. Small states are as likely to be blinkered and tyrannical as they are to be just and free. Those that succeed, like Liechtenstein, do so by a combination of extremely hard work and good luck. Nonetheless, the idea of the small state retains a powerful hold over the political imagination, reminding us that - in the words of a slogan popular with the left - another world is possible. In the larger Europe, we have much to learn from Liechtenstein, including the value of the local over the central, the human scale over the grand design and a sense of history over the shock of the new.

Aidan Rankin