Wednesday, April 9, 2008

Forget economic downturn says Latvian "elite" (updated)

Today's Apollo published a quick review where two simple graphs show actual and percentage increase of salaries of the 20 Latvian public sector top managers. Previous and incumbent PM keep reiterating to the Latvian folks that they should seriously limit their expenses, because of expected economic downturn. Latvian top managers seem to care less. Actually it seems that hefty 38-70% annual increase for "some" in public sector from 2006-2007 is due to their brave determination to "fight inflation (!)", and thus allowing Latvian economy to pass the economic abyss:) Day after tomorrow in April 11 preliminary results for initiation of the referendum will be known as well there will be special session on Lattelecom privatization deal.

In the meantime, tomorrow there is the day of reckoning for the Transport Supremo. Opposition New Era party (JL) demanded the vote of non confidence about Mr Šlesers because of his incompetence whilst overseeing the work of the Latvian Post Plc., impeding competition in RIX, allowing mismanagement and not providing competition in Latvian road building sector etc, etc.

Transport Supremo studied in the same school I went, the Riga Secondary School No. 25. Differently from most of us he finished elementary school at No. 25, and further continued in vocational school. He was a grade older than me and I do remember how Mr Lešinskis (he took his wife's surname after the marriage) was very active selling jeans and other items at school in the late 1980's. He is a good manager, and he actually fits well into the post-Soviet management culture in Latvia. The major tenet of such "management culture"is that the you cannot manage anything without political networks, and state administrative capacity is undermind with the lack of transparent rules.

Such management culture still thrives in Latvia, but simulataneous challenges from globalization (trade and financial liberalization) and EU legal norms turn the "traditional Latvian management culture" into a drag on economy. Changes are in the air and Transport Supremo should better think about exiting from politics. Actually, today's Kas notiek Latvijā TV show is devoted solely to the question of "to be or not to be transport supremo". It is going to be a good show and update would probably follow.


The TV debates ended with the usually high number (7902) of telephone voters saying that Transport Supremo is simply not up to his task. Opponents to such opinion were scanty 300. There is an opinion that teledebate has no direct effect on the way realpolitik works. Obviously in the parliamentary system minister should not resign just because spectators in some TV debate deem it right. Nevertheless, temperature of the public opinion is a very serious factor for stability of the government in "old democracies" and I would argue that increasingly so also in "new democracies". If not Kas notiek Latvijā show we would not have even budding civil society today. Every quality discussion I believe gradually brakes the untouchable oriole of Latvian politicians and civil servants. In effect the teledabate was created for upgrading the culture of political discussion in Latvia, and those were prominent intelligentsia members who promoted creation of Kas notiek Latvijā.

For the sake of the signature collection campaign the manner Mr Šlesers rebuked arguments of opposition actually worked well. The fact is that Transport Supremo proved that he has learned only couple of maxims of Machiavellian politics - to avoid answers to direct questions with auxiliary "number crunching" and to speak eloquently. In fact Mr Šlesers "number crunching" looked silly and his eloquent speech is balancing on shallow demagoguery. In addition it was just sick to hear his Communist Youth style bragging about the megalomaniac plans to have roads better that in Estonia in five years whilst the latest report of IMF(pp.85-88) just came in. Transport Supremo is not just academically unprepared (he does not have university degree), but he is also caught unawares about the fact that Machiavelli usually stressed the virtue of promoting interests of res publica and not just una famiglia!!!

Whilst answering about the sorry state of the Latvian Post Plc, his excuse was that there are too many redundant workers and that he tried to get more help from the government, and that he succeeded in this endeavour. Talking about the sorry state of Latvian Roads Plc, lack of competition in road building his excuse was absolute under financing of Latvian roads before him, because Mr Repše (New Era party) had liquidated state roads financial fund, and the fact that European companies are not interested to enter into the small Latvian market. Direct questions from opposition members were not answered.

In nutshell following questions were asked. Ceteris paribus, while costs of road building in the Baltic states are almost the same, why is it so that street signs and 1 km or road expenses are twice as expensive in Latvia, why sand expenses in Latvia are twice as expensive in Lithuania, why Finnish and Swedish raodbuilders work in Estonian market that is actually smaller than Latvia??? All these questions were unanswered and I am sure the scattered opposition members will repeat the same questions tomorrow in the Saeima where they have initiated the Minister of Transport vote of non confidence.

In the meantime the coalition still looks rock solid and even opposition Reconciliation Party said that they would not support the vote of non confidence, because ...guess what?? You are right, because Mr Šlesers is the only minister who supports allowing non-citizens to participate in municipal elections!!! Such thing as consistency of issues debated in any municipal council or in Saeima, or rational policy making is simply ABSENT so far...still sad:(


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