Eurocrash: how Latvia's boom turned to bust (make that "slump")
Amid the snow and concrete of Rumbula airfield in Latvia, there are still dotted the silhouettes of smashed-up Soviet-era aircraft bunkers. But it is not the wreckage of the communist system I have come to see. It's the wreckage of what replaced it.
Where the Tupolev bombers used to stand there are now parked, bumper to bumper, hundreds of brand new articulated trucks that have been seized from their owners by the banks.
"It feels a lot like the early nineties, just after the Russians went," says Kaspars Virsnitis.
His construction supply company was turning over 8 million Euros last year. Now it's gone bust and his premises have been commandeered as a makeshift lorry park. It was when that filled up that they had to start using the military runway.
"People are losing their jobs; buildings half-finished. We're back to square one."
His order book collapsed last October at the same time as most of the builders who owed him money went bust.
Why didn't you see it coming and plan for it, I ask?
He stands on one leg and pumps his other foot: "Last government. They just said: put foot on accelerator to floor".
Latvia grew faster than any of the boom economies of the Wild East. Last year its GDP was growing at over 10% per annum. This year it looks set to shrink by 14%. Public sector pay, having been cut by 15%, is to be cut by 20% more; 20% unemployment is a realistic figure by the end of the year.
When I ask the country's youthful new prime minister, Valdis Dombrovskis, when he expects the economy to begin growing once again he says, quietly: "Right now we don't talk about that".
Latvia, in short, is at the beginning of a slump. And the tempo of a slump is slow: explosive start gives way to slow onset and slow recovery.
We have to hope that the rest of the world can avoid one, but it is still not certain. The psychological impact on the post-soviet generation here, that has known only the upside of capitalism, can only be guessed at.
Watch my report on the Latvian economic collapse below:
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So why does my tour of eastern European economies matter? Well, the crisis here could pull much of the West European banking system down with it. And economic sovereignty is draining away from places like this. Their fate will be decided in the IMF offices in Washington, not the soviet-era chancelleries.
