By 1965, it was obvious that fundamental changes were necessary. The economic reforms introduced that year promoted profitability (profit had been taboo before); the subsidies for firms producing at a loss were to be discontinued; and a market economy was to be introduced. In this, Yugoslavia was ahead of the Soviet Union by two decades. But the reforms did not work because they did not touch the overgrown bureaucracy. In fact, in Yugoslavia, as in the rest of the communist countries, the socialist economic system could not be reformed. It could only be abolished, which is what happened after 1989.
Davico J., and Bogoslavjevic M., The Economy of Yugoslavia ( Belgrade, 1966); Rusinow Dennison , The Yugoslav Experiment 1944-1974 ( New York, 1977); Vucinich Wayne, ed. Contemporary Yugoslavia ( Berkeley, 1969).
Panic, Milan ( 1929- ). Panic, who was born in Belgrade, joined Tito's partisan army at the age of fourteen. He became a sportsman, a bicyclist after the war and rode to a bicycle championship. In 1956, while on his way to a bicycle race, he defected to the United States. He settled with his family in California, in 1963, Panic became a United States citizen. He attended the University of Southern California and was trained as a chemist Between 1957 and 1959, he was a graduate teaching assistant at the university. With capital of $200, he started his own company in 1960, which burgeoned into ICN Pharmaceutical Inc., based in Costa Mesa, California. The company's annual sales amount to about $500 million. In 1986, he was one of eighty Americans awarded the Ellis Island Medal of Honor by the Congress of the United States to honor emigrants who made distinguished contributions to the United States. Although he was totally without political experience, Panic was elected prime minister of the Federal Republic of Yugoslavia ( Serbia and Montenegro) on July 14, 1992, by the Federal Assembly. He promised peace and prosperity. His first effort consisted of bringing peace to the warring republics and ethnic groups, hoping that this would lead to the lifting of sanctions against Serbia by the United Nations. Panic repeatedly declared that the war in Bosnia and Herzegovina was not one of hate and ethnic conflict, but was the product of the actions of unscrupulous politicians who were benefiting from the slaughter. He also declared that not more than 1,200 hoodlums, criminals, and other assorted ugly characters were responsible for the troubles.
Opinions are divided over the relationship between Panic and Slobodan Milosevic (see Milosevic, Slobodan). Some believe that Milosevic has been using Panic to gain time. Panic has called on Milosevic to resign in the interest of Serbia. Although Panic survived two non-confidence votes in parliament, he subsequently lost the presidential election to Milosevic.
Andrejevic Milan, "What Future for Serbia?" Radio Free Europe Research Report, 1. 50 ( December 18, 1992), pp. 7-17.