What Is Worse?

Slow growth is not in itself a negative phenomenon; an economy needs to be developed and strengthened. Countries can only be properly compared by means of discriminant (differentiating) analysis.

Unfortunately, the EU did not do this.

Although I have already published, in my Reminiscences, a six-equation macroeconomic model for designing economic policy, the headline quoted above and the three points accompanying it require me to examine the problems of how an economy functions in greater depth. One has to be able to “see inside” an economy before drawing conclusions; otherwise, what we get are merely inventions and accusations by commentators. The Slovak economy needs expansion, and we must know how to achieve it. That is the task facing our economic policy.

The government must pursue our own economic policy. Not one designed to suit somebody else.

I must begin with the major world-class achievements of our industry — that is, of the Slovak economy.

The years of prosperity, 1960–1989

River-sea cargo vessels and passenger ships

The principal customer became the Soviet Union. The OL-400 became the largest river passenger vessel, with a capacity of 400 passengers. Bucket dredgers were also manufactured for the Czechoslovak Danube Shipping Company. During the socialist period, the shipyards employed almost 5,000 people and formed part of the ZŤS industrial group under the name Slovenské Lodenice Gábora Steinera.

What happened to them after the transition to a market economy?

The largest electric motor in the world

The ZSMK industrial enterprise in Tlmače was where I began my career after university. It employed as many as 8,000 people. SES Tlmače succeeded in manufacturing stators with a diameter of 6.5 metres — a unique technological achievement. The order came from the German company Siemens.

It was a unique project and involved the largest electric motor in the world. Three enormous prototype stators were produced, each with a structural weight of 224 tonnes, a maximum external diameter of 19.8 metres, and a height of 2.3 metres. Because of its dimensions, each stator had to be manufactured in four sections.

The contract was worth SKK 25 million (€829,847.97). Each stator was assembled from 90,000 silicon-steel sheets.

The motor was manufactured to drive gigantic mills used to crush copper ore in Argentina. A single crushing steel ball had a diameter of one metre. The electric motor had an input power of 400 MW. By comparison, one unit of a nuclear power station has an output of approximately 440 MW.

The construction of these two enterprises represented investment in production. These were genuine achievements of the Slovak economy.

What motive lay behind the destruction of both enterprises? What triggered it?

Both cases show where the strength of the Slovak economy once lay. By the strength of an economy, I mean what its enterprises are capable of producing, and the ability of an economy to carry out productive and economic activities based on scientific knowledge — as demonstrated both by the electric motor and by the largest ship — knowledge that we later began to ignore.

Both enterprises employed highly skilled and professionally trained welders. SES alone certainly had at least 300 welders.

Where did they find work afterwards?

They were expected to retrain.

In 1989, many people were captivated by the slogan that the market will solve everything and the state is the worst owner.

That was an illusion. A myth.

Let me put it this way: the Slovak economy contains many contradictions. The degree of these contradictions has already reached a critical level, and that is precisely why we must know what to do with the economy and understand how demanding economic management really is.

The principal contradiction is that a class of oligarchs has emerged alongside a class of poor people.

What caused this?

After 1993, the management of the economy was not based on knowledge, despite the fact that we even have control theory as an independent scientific discipline with a strongly interdisciplinary and systemic character, examining the structure of management processes in the economy.

Indeed, every macroeconomics textbook tells us that the most important issues are the production of output, the accumulation of output, and the distribution of output — in other words, the production generated by enterprises and its distribution within society.

The destruction of these two enterprises therefore could not have contributed to economic growth, which is what the first point in the quotation calls for.

And the statement in the quotation —

“Growth did not even mirror the spring recovery in the euro area”

— is not a professional formulation of the problem.

Our growth should not mirror anything. It should make the fullest possible use of our own resources: land, labour and capital.

Unfortunately, more than 151 enterprises were destroyed or privatised.

And this is what is worse.

That is why the Slovak economy now finds itself near the bottom of the EU in terms of economic performance, even though in the past we were capable of manufacturing the largest electric motor in the world.

Above all, the architect of economic policy must understand that economics always seeks the best possible — that is, the optimal — solution.

I do not know whether the EU does this.

The meaning of an optimal solution is that we define a goal, express the criterion quantitatively, and also express quantitatively the relationships, dependencies and constraints associated with the available natural and human resources of the economy.

In assessing economic performance, therefore, we also seek extreme values — that is, the minimisation or maximisation of a given objective.

The criteria may differ: for example, minimising costs, maximising profits or, at the level of the economy as a whole, maximising investment expressed by the ratio I/S — that is, the ratio of investment to savings — or maximising the satisfaction of human needs.

This was forgotten in the Recovery Plan, while investment declined.

The author of the quotation states:

“The Slovak economy continues to grow slowly. It has failed to exceed one percent for six consecutive quarters.”

Economists do not speak only about growth.

They also speak about economic development.

If a private farmer invests the income from selling potatoes in a modern tractor that, above all, saves labour; or builds an irrigation system so that crop yields no longer depend entirely on rainfall; or purchases new environmentally friendly fertilisers that do not damage the soil and help preserve its quality — all of this represents development of the farmer’s business and of the economy as a whole.

I should also point out that the authors of economic policy appear not to realise how many large-scale models have been studied and experimentally tested in contemporary economic science, models capable — with sufficient accuracy — of determining the long-term prospects for the development of a national economy. The EU vision of the Slovak Academy of Sciences did not make use of them.

Such models can also be used to analyse the ordinary functioning of an economy and its individual components.

Did the EU know how the economies of the individual member states would develop when we joined?

I will mention only Key Theories and Models in Urban and Regional Planning History from 2025 — in other words, key theories and models in the history of urban and regional planning.

The EU Recovery Plan is not based on a regional model. The amounts allocated to individual countries under the Recovery Plan were determined arbitrarily rather than scientifically.

The EU has 27 member states, and first and foremost their particular conditions must be respected.

An economy is a complex, hierarchically organised system — and so is the economy of the European Union as a whole. It is characterised by a certain degree of inertia: its structure cannot be changed arbitrarily, according to one’s wishes, or within a short period of time.

One example is the ratio of investment to savings, expressed by the coefficient I/S.

The architect of economic policy cannot rely on chance.

Conclusion

The quotation did not probe deeply into the problems of the Slovak economy.

I have demonstrated the advanced nature of our industry by referring to two Slovak enterprises during the socialist period. They produced the largest ship and the largest electric motor in the world.

In this essay, I have shown that such technological solutions genuinely require scientific knowledge.

At the same time, I have highlighted another aspect: economies, as objects of management — including the development of their sectors and individual components — require deep knowledge of model construction and the application of such models.

They can provide a completely new insight into how an economy functions, allowing economic measures to be targeted with an expected result.

After 1993, our enterprises increasingly found themselves in financial distress.

Economic theory and control theory were neglected, even though control theory is an independent scientific discipline with a strongly interdisciplinary and systemic character that examines the structure of management processes in an economy.

The economy as a complex system, and especially the economic space of the European Union, requires large-scale models capable, with sufficient accuracy, of determining the long-term prospects for the development of national economies.

Today, such models are virtually unknown in our country.

We have made virtually no use of forecasting models.

I cannot fail to emphasise that our opposition completely lacks a sober, sufficiently deep and comprehensive approach to economic policy.

How could the shipyards have fallen into financial distress?

Why did they not function as they had before 1988?

What was it that came to us?

What is worse?

Prof. J. Husár
Rohovce, 12 September 2026