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Andrej Grubišić
Episode · #63

RITAM POSLA Andrej Grubišić

Guest Andrej GrubišićHosted by Lidija KiseljakMay 3, 2026
About this episode
What you'll hear in this conversation

The economic challenges facing Croatia are not new, but their persistence raises a fundamental question: are the solutions politicians offer merely symptoms, or do they address the root causes? Andrej Grubišić, a consultant known for his sharp analysis of public finance, argues that the country's economic stagnation and recurring public sector strikes are direct consequences of a state that has overextended its reach. He offers a contrarian view, suggesting that many functions we assume are the state's responsibility are, in fact, individual obligations—and that the current system traps both citizens and public servants in a cycle of dependency. This conversation will make you rethink the true cost of "free" services and the power of individual choice in economic development.

Insights from the conversation
What to take from this episode
01
When public sector workers demand higher wages, Andrej Grubišić notes that "whoever complained always got what they asked for." This pattern of political appeasement has created a system where short-term demands are met, but the underlying structural issues—and the state's ever-growing financial burden—remain unaddressed, leading to a cycle of dependency.
02
Grubišić points out that nearly 70% of Croatian citizens depend directly or indirectly on state spending. This level of reliance on the public purse categorizes Croatia as a "socialist economy" by modern standards, contrasting sharply with other post-socialist EU members that have achieved significantly higher living standards by fostering greater private sector autonomy.
03
Croatia's real purchasing power per capita has barely moved since 2008, even as government spending has grown substantially, and hundreds of thousands of private sector workers have emigrated. This divergence reveals a fundamental imbalance: the state's expansion is happening at the expense of its productive citizens, who either leave or find their economic prospects stagnant.
04
Grubišić argues that the state has wrongly assumed responsibility for pensions, education, and healthcare, functions that currently cost over 80 billion kuna. By treating these as "free" services, the system fosters a false sense of entitlement and stifles market-driven solutions that could deliver better quality and fairer compensation for those providing the services.
05
Public sector workers in education and healthcare are "cornered" by having essentially one employer—the state—due to high tax pressure that prevents serious development of private alternatives. Liberalizing these markets would empower workers by giving them choices beyond striking, forcing employers (public or private) to compete for their talent and pay them commensurate with their contribution.
06
The common argument against individual management of pension and healthcare funds is that "our people are not ready" to manage their own money. This paternalistic stance denies citizens the freedom to choose and disincentivizes rational financial behavior; giving people control over their significant contributions would likely lead to greater personal responsibility and better outcomes.
07
Grubišić describes Croatia's first-pillar pension system as a "Ponzi scheme," where current contributions fund current retirees, offering no individual saving for the contributor. This system relies on an uncertain future promise that subsequent generations will continue to pay in, making individual retirement security dependent on demographic trends and political will rather than personal financial accumulation.
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