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The Kostunica government has already started to implement deadly IMF "economic medicine." The first step consisted of lifting price controls on fuel and basic consumer goods, and services. Prices have increased, as much as three times, causing extreme hardship for Yugoslav working people.

The country had been impoverished by years of economic sanctions, not to mention the IMF reforms applied in 1989-90, before the break-up of federal Yugoslavia. But a system of state subsidies and price controls nonetheless prevented a total collapse in the standard of living, as occurred in neighboring Bulgaria.

That system of price controls is now being disbanded by the Kostunica government on orders of the International Monetary Fund (IMF):

"When Kostunica supporters forced out most managers in state-owned shops and factories and put their own people in charge, that system of controls collapsed and prices immediately shot up. The cost of cooking oil has more than tripled since last Friday, when Milosevic announced that he was stepping aside. The prices of sugar and cigarettes are about to jump again. After Kostunica's supporters forced out Milosevic-era factory directors, the new ones are moving quickly to make their plants more profitable." (Los Angeles Times, October 15, 2000)

To make sure the government could not finance subsidies, the G-17 economists forcefully took control of the Central Bank and immediately imposed a freeze on money creation ("printing of money"). This held up the outflow of cash, which the government needed to sustain price controls on basic consumer goods.

According to interviews conducted with Belgrade residents shortly after the election, the price of milk had already doubled from 8 to 14 dinars per liter, largely affecting children; the price of cooking oil had more than tripled, from 13.5 to 55 dinars; sugar had gone from 8 to 45 dinars. These interviews support the earlier Los Angeles Times report.

Shoppers are commenting, "Ah, democratic prices!" The Serbian use of black humor masks rising anger among ordinary people. Faced with this simmering rebellion, the Kostunica government, advised by the G-17 economists, have performed a dazzling flip.

Prior to the Oct. 5 coup d etat, the government made some attempt to protect domestic producers and ensure (under very difficult conditions) the distribution of essential food staples, fuel, and electricity at controlled prices. The Kostunica coalition abolished price controls then seemed to be using the suffering it created to justify the dumping of low priced (often inferior) food and products, thus destroying small producers.

The Western media, which just a few days earlier had congratulated Kostunica for removing price controls, now uncritically trumpets the line that it's all Milosevic's fault.

Concerning the rapid increase in prices, the program drafted by Dinkic's G-17 Plus is rather explicit: "Immediately after taking the office, the new government shall abolish all types of subsidies. This measure must be implemented without regrets or hesitation, since it will be difficult if not impossible to apply later, in view of the fact that in the meantime strong lobbies may appear and do their best to block such measures... This initial step in economic liberalization must be undertaken as a "shock therapy" as its radical nature does not leave space for gradualism of any kind.

The G-17 program they wrote attacking Milosevic had stated in no uncertain terms that "they would do it," -- that is, they would get rid of price controls. They have driven Milosevic out and begun to "do it." Naturally if prices have spiraled, it is Milosevic's fault.