Tag Archives: Baltic

Hilmar Þór Hilmarsson, The Economic Crisis and its Aftermath in the Nordic and Baltic Countries: Do As We Say and Not As We Do (London: Routledge, 2019)

This is a timely book written by a macroeconomic expert with a broad theoretical and institutional knowledge of the region under consideration. The pivot question to be answered in this book concerns how small northern European countries came through the economic crisis, and what prospects they may experience should a new crisis hit them. From the very beginning, it becomes clear that a ‘small economy’ is not necessarily a well-defined analytical concept. In economic terms the so-called Continental Nordic countries are large compared to the three Baltic States and Iceland, approximately in the proportion 10:1, although in size of population the disproportion (except for Iceland) is somewhat smaller.

The author quite quickly reduces his analysis to focus on how the ‘small’ small economies managed the crisis. He is undertaking a rather broad-ranging scrutiny of the economic development of the Baltic States compared to Iceland and, to a much lesser extent, the bigger Nordic economies as well as transitory economies in central Europe (Poland, Slovakia and Czech Republic). He wants to figure out why the Baltic States had the worst macroeconomic record of all these countries with regard to getting through the aftermath of the financial collapse of 2008/09. These three countries had the steepest fall in GDP, the highest rise in unemployment, the highest rate of inequality and, without any comparison, experienced a large emigration rate (close to 10 percent of population) of mainly young people.

Chapter by chapter the author goes through the likely economic explanations of this poor performance. One overall conclusion is the lack of economic and political autonomy and the very Anglo-Saxon inspired welfare regimes of all three Baltic states, which is a striking difference when comparison to the economic development in Iceland is analyzed.

The relatively weak automatic budget-stabilizers made GDP and employment plunge dramatically, causing a kind of exodus of mainly young (educated) people to leave these countries. Furthermore, the political elite felt themselves very committed to make the countries become a full member of the euro-zone as soon as possible. This political ambition made a fixed exchange rate policy an indisputable request from the EU. Hereby, a re-start of an economic up-swing by a strategic devaluation of the currency was blocked, even though the IMF recommended, at least in the Latvian case, such a policy.

The author is also pointing at the dominant position of foreign, especially Swedish, banks. In practice, the Baltics had no financial autonomy. The private sector had to borrow at subsidiaries of foreign banks. Credit policy was decided in Stockholm rather than in Tallinn, Riga and Vilnius. All three countries ran heavy balance-of-payments deficits in the boom leading up to 2008 – foreign loans were seemingly without limit. When the credit turn-around suddenly came, governments had to ‘do as we say’ (part of the book’s subtitle), meaning that the foreign banks had a large word to say in economic policy (i.e. fixed exchange rate and austerity) and requested a (partial) bail-out of some insolvent banks – causing public debt to rise. The parallel to Southern Europe (see Jespersen 2016) is striking, whilst the contrast to Iceland is revealing: dramatic devaluation, limited and socially balanced austerity, and no bailing out of private banks.

The content of this thought-provoking book, I think, can be summarized by a quote (found in the book, p. 14) by Joseph Stiglitz: “This book is about economics and economic ideologies and their interactions with politics: it is a case study of how, even the best intentions, when new institutions and policies are created on the basis of oversimplified views of how economies function, the results can be not only disappointing, but even disastrous” (Stiglitz, 2016, p.7, emphasis added).

The over-arching hypothesis is vindicated: that the Baltic States came through the economic crisis more poorly than neighboring states due to an inadequate economic policy dictated by their political elite and foreign stakeholders (i.e. the EU and the Swedish banks). But, and this is an important “but” which the author stresses several times, their specific history and the present somewhat tense security situation along the Russian border (in relation to a significant Russian-speaking minority in Estonia and Latvia) called for a tight political integration to Western Europe (economics) and the US (defense).

Having emphasized this extraordinary political challenge and the limited sovereignty of the governments, the author is still rather critical when it comes to social policy. It is, according to him, mainly a national prerogative to decide on how the burden of public expenditures and the economic crisis is shared among people. The Baltics are the most unequal societies in the Northern region, and here the governments could take lessons from the more mature Nordic welfare states, where the burden is much more equally shared. The Anglo-Saxon welfare model only works (if at all) in countries with a high degree of fiscal and monetary autonomy, like the US (and perhaps also the UK). It is in this light that the somewhat subtle subtitle of the book, “Do as we say and not as we do”, can be understood. The author is hereby making an accusation against the external advisers (especially representatives from Sweden and Finland) that they recommended/required a fixed exchange rate and austerity policies of the Baltic governments; but when they were in a similar situation, in the early 1990s, these two countries devaluated the currency strongly and kept their welfare system intact. The word of ‘hypocrisy’ is written between the lines, whereas Iceland stands out as a strong counter-example.

The book is to be recommended to anyone who takes a serious interest into the economics of the Baltic States and wants to go beyond prejudice and conventional wisdom.



Jespersen, J. (2016). The Euro – Why it failed, London: Pivot-Book, Palgrave/Macmillan.

Stiglitz, J.E. (2016). The Euro – How a Common Currency Threatens the Future of Europe, New York and London: W.W. Norton & Company.

Felice Vinci, Omero nel Baltico. Le origini nordiche dell’Odissea e dell’Iliade (5th edition; Rome: Palombi Editori, 2009)

The book tells, and documents, the author’s journey following his original intuition: can the geography described by Homer in his epics be related not to the Mediterranean coasts and towns, but to the Scandinavian ones? Vinci pursued such an ‘experiment’: he tried to fit Homer’s places into the Scandinavian context. And according to Vinci’s studies, partially supported by further studies by Nilsson and Tilak, the protagonists of the Iliad and the Odyssey could have actually lived and performed their heroic deeds on the coasts of the Baltic Sea. One of the starting and strongest points of Vinci’s research is already suggested in the ancient historical sources: Plutarch stated that Ogygia island, where Calypso kept Ulysses for several years, was in the Northern Atlantic, five days of navigation away from Britannia. Then, the evidences mingle with an unstoppable sequence of facts and hypotheses, reasonings and dreams. For example, why is it said that the island of Faro, in front of Egyptian Alexandria, took one day of navigation from Egypt?

As Vinci bears witness to with his studies, the names of Homeric places still overlap with the names of Northern villages and cities. The same applies to the distance between towns, the description of the warriors’ garments and habits, as further substantiated by well-documented archaeological and historical studies that match Vinci’s peculiar theory. Furthermore, there is an answer to the issue of the climate described in Homer’s poems: the Baltic Sea was warmer at that time, just before the end of the ‘climatic optimum’ that forced Nordic populations to move to warmer places, i.e. to the Mediterranean area.

As the cooling of the climate is concerned, I must confess that I felt myself shivering: what an intellectual vertigo does induce Vinci’s notion, whereby Europe’s classical culture shifts suddenly northward. Torn between my Mediterranean birth and my sympathy for Nordic countries, having visited Greece and the ‘epic’ places of Achilles and Telemachus, I still find it difficult to accept the idea that Ithaca may be one of the Danish islands, Troy to be in the Gulf of Finland, Crete in Pomerania, and Mycenae, perhaps, the ancestral cradle of today’s Copenhagen. Not to mention Ulysses–thus interpreting Tacitus’ definition–being a forerunner of the Vikings, maybe even the Ull recalled in the Edda.

Yet, as the classical scholar Rosa Calzecchi Onesti states in the foreword to Vinci’s book, none of the great previous researches on Homer’s geography is in doubt, because Vinci argues that such Northern populations recreated a second ‘Baltic’ along the Greek coasts and islands. As historical novelist Franco Cuomo writes in the preface, Vinci’s book must be “read like the memory of a population who, moving elsewhere, brings along its own myths” (p. 9) . Vinci’s book evokes Homer’s epics as a primordial portrait of a ‘greekness’ that we have learned to know and imagine through classical texts, visual arts, movies, travels, etc. We know that history is crowded of misunderstandings and misinterpretations, and Vinci’s theory shall be seriously considered as a new approach to Homeric and classical studies.

The book suffers from the poor quality of the pictures contained therein. Also, I cannot comment on the conclusiveness of Vinci’s revolutionary thesis. Still, I can appreciate its originality, the personal approach of Vinci when he recalls his journeys throughout Scandinavia, the careful descriptions of the landscapes he visited and their comparison with well-known Homeric places, and the wealth of historical sources cited to support his stance.

Vinci copertina Palombi

Felice Vinci, The Baltic Origins of Homer’s Epic Tales; The Iliad, They Odyssey, and the Migration of Myth (Rochester, Vermont: Inner Traditions, 2006)

For a similar instance, in his linguistic argument suggesting Ogygia lies in the Faroe Islands, he points out that Hogoyggj, the name of the mountain, is very similar to Ogygia as referenced in the story. Finally, while walking through his geographic and linguistic arguments that these epics are of Baltic origin, Vinci refers to the many times the weather is cold, misty, freezing, foggy, and with deep velvet colored seas, pointing out that this bears little resemblance to our warm, sunny, and blue understandings of the Mediterranean. This is but one series of examples in a few pages, with the book explicating many more throughout its length.

I found Vinci’s arguments compelling, although scholars more familiar with the epics will want to review the evidence for themselves. As this was new information for me, it set my imagination alight, and I found myself looking into other similar scholarship. This is a burgeoning literature, including Vinci’s other writings, and stretching back to Olof Rudbeck’s discussion of Atlantis as Sweden. It is worth noting that Vinci also gives a treatment of Atlantis in this work – but the reader can find out for him or herself where Vinci stands. Vinci’s work comes across as competent, separating it from some of the pseudo-scientific work which was propagandized by the Nazis. But this is where familiar scholars will be able to more quickly separate the legitimate and paradigm-challenging work from the rest.

As a sociologist with an interest in cultures, the follow-up question is intriguing. If these epic tales took place in the Baltic region, then how did they eventually take on a Mediterranean home? By what mechanism does a piece of culture move from one corner of the globe to another, but forgetting key such key elements as Sweden = Ithaca? Vinci addresses this in the 4th part of the book, appropriately titled “The Migration of Myth.”

A key component to the migration of myth here is the role of climate. Vinci locates much of the narrative in the climactic optimum (4000-3000 BCE) when a warmer climate made regions near the arctic much more pleasant and habitable. With the ending of this warm and favorable period, at least some of the northern people migrated southward. He argues that in the mythologies of many cultures, there are remnants of climatic collapse, and provides several examples of cultures that were disrupted or dislocated by the negatively changing climate. For examples of these possible migrations he draws from several northern Europe locations for sources of Indo-European cultures. He provides numerous cultural and mythic references creating potential links. These include possible cultural origins of several peoples in the Scandinavian or Russian Arctic, Aryan migrations southward and potential northern links to Egypt and Rome. Much of this argument is built on similarities between mythologies, biblical tales, and place names.

This part of Vinci’s work is much more speculative in my opinion, and creates something of a “kitchen sink” feel by throwing in all the possible connections. In looking for the potential northern origins of mythologies and peoples, Vinci brings in enough possibilities that it feels much more exploratory than the first half of the book. In all fairness, the research may only be at the exploratory level at this point. Nevertheless it is not as convincing as the argument that the origins of the epics themselves are Nordic – regardless of how those tales ended up in the Mediterranean.

The base outline of Vinci’s argument is as follows (p 327)

  • The Iliad and the Odyssey are properly situated in northern Europe
  • The original sagas on which the epics are based on Baltic regions
  • The tales travelled from Scandinavia to Greece at the end of the climactic optimum by blond seafaring Mycenaeans
  • In rebuilding their world in the Mediterranean, familiar place names and mythological events were reused
  • Through the epics, the tales of their ancestors were preserved, although their homeland was lost

He finishes his work by suggesting several lines of archaeology to investigate this line of reasoning, and provide physical evidence reinforcing the mythological and linguistic evidence.

This work is broad in scope and presents an utterly fascinating reordering of the epic sagas of the western world. As such, the realm of possibilities for new research and analysis is deeply exciting.