Sunday, September 14, 2008

Contemplations after the Latvian referendum summer

Latvian public had to live through two referendums last August. In representative democracy there is no real need after referendums, because referendums would intrinsically show that MP's are unable to reach a consensus in some issue. Perhaps my conclusion would sound to harsh, but "the referendum culture" is viable only in Switzerland and in some Western states in the US. Referendum traditions have developed there as combination of historic development and structural absence of the established political system. Thus, the referendum culture does not really exist in other West European states, because the legitimacy is founded in the quality of the representative democracy. For example, West Germany after passing its Grundgesetz in 1949 specifically tried to avoid developing the referendum culture. Simply its recent past and the example of an Austrian from Linz achieving his political summit through techniques of plebiscite democracy made the FRG politicians to conclude that referendums would only be giving bonuses to demagogues (prämie für Demagogen). Regardless of the suspicious FRG politicians referendums have been making small inroads into the political culture of the Central and East European states.

Grand issues of independence or joining the EU are obvious questions for plebiscitary referendum to take place. When there are issues of language, security or pension laws discussed in referendum it obviously raises the issue - why politicians in Latvia cannot agree on such issues in the parliament? Answer is simple, while issue of language law or non-privatization of the energy monopoly (Latvenergo) took place during the 1990's, when the political system was still democratising, the questions of security and pension laws as well as constitutional amendments in August 2 were caused due to consequences of stolen elections in October 2006. Since August 2006 the trust in democratically elected representatives in Latvia has started its downward slope.

Latvian political culture shows a specific trend. There is a clear correlation between the slump of governing elite's credibility since the last elections, and increased activity of civil society through referendum campaigns. Namely, the opposition parties in Latvia are not taken into consideration. Simply the governing coalition follow the abstract and taken out of context notion of "democracy being simply the majority rule". Instead of developing the culture of debates in the parliament, and consolidating ideologically distinguishable parties in left-right or freedom-authority nexus there is nothing of this kind in Latvia. The totalitarian and Karl Schmidt'ian notion of inability of the representative democracy to represent the interests of the pople, and thus, the culture of caring about the abstract nation (tauta, das Volk, narod, rahvas) still prevails in public domain in Latvia. Such culture inescapably fosters the culture of populist politicians. Populism is the only way to achieve the recognitions in the Latvian utterly stagnated political establishment.

There are now two new parties formed. The Civic Union is considered as the right wing conservative party, while the Society for Other Politics (SCP) is a socially liberal party. Onset of both parties is intimately connected with referendum issues, because for an opposition member there is no way to brake out of the mediocre discussion culture in the Latvian Saeima. Thus, both new political parties were active in supporting the referendum activities. The Civic Union and also the SCP founders were actively supporting the cause for the referendum of the August 2, that would have given the 1/10 of the Latvian electorate the right to initiate the procedure of dissolving the parliament. The Civic Union was not supporting the August 23 referendum campaign where the SCP was the initiator of the campaign together with the Social Democratic party and the Pensioners Federation.

The first referendum campaign failed because the needed quorum was about 150 000 short. Organizers of the referendum after their loss blamed the Central Election Bureau for organizing the referendum in summer, when most of the folks are vacationing. This is very dubious excuse, because the initiators of the referendum (Free Trade Unions) should have known the procedure. The procedure clearly states, that after the needed signatures for initiating referendum campaign are submitted to the parliament and parliament gives it a go, the referendum should take place no earlier than a month or no later than two months after his date. Thus, if the Trade Unions really wanted this referendum to succeed, then they could submit the signatures in Autumn and referendum would have taken place in early Winter. Anyway, the date is not the only issue. The fact that about 900 000 eligible voters did not budge shows very much that the traditional population did not comprehend the significance of the constitutional amendments, and also that the same population either is totally alienated or their basic material needs are met (bottle of vodka, bread and sausage and NO WAR is enough as the traditional proverb goes:).

The second referendum campaign would have made the present governing coalition finally start reforming the Latvian stagnated fiscal policies. Unfortunately, the second election campaign was also about 100 000 signatures short. In the last moment the Pensioners Federation and its outspoken leader Aina Verza withdrew their support. The reason for the lack of support of the prime "potential beneficiaries" was unexpected. The government and the ministry of welfare was creating the horror scenarios explaining that the possibly successful referendum campaign would destroy present pension payment system. Thus, the traditional Latvian voters listened to the simple reflex of survival, because the trauma of continuous transformations since the collapse of the USSR is too heavy. I personally met several elderly ladies in Salaspils who were openly saying that they want to believe in the new proposals of the SCP and referendum organizers, but they better stick to the old ways, because "they at least know that system and after all their representatives would not allow them to die immediately" (funny isn't it:). The referendum organizers did indeed envisage termination of the existing governmental practice to borrow from the social fund whenever there was a need to have a balanced budget. the latter practice allows all these years the Latvian government to continue its status quo governance, and not to worry about the burgeoning government apparatus. Borrowing from the social fund at times when about 200 000 pensioners have hardships in keeping ends meet to support the burgeoning class of administrators is both immoral and utterly irresponsible.

Only about 325 000 people considered it so, whilst the rest of the Latvian electors trusted promises of the government to rise the minimum unemployment rate from 45 to 60Ls prior referendum, and to act decisively if the economy should stall. Now the economy has really stalled (even the Bank of Latvia envisages the 0,5GDP growth this year, and that is the fall from 13GDP growth in 2007(!)) and it appears that both the Prime minister and the Minister of Welfare lied about the rise of the minimum rate of unemployment benefit, and also about decisive actions at times when economy stalls.

This Wednesday Kas notiek Latvijā TV emission clearly showed that Ivars Godmanis was lying. Amidst his number crunching tirades Valdis Dombrovskis (MEP-JL) and Gatis Kokins (SCP) asked the head of the cabinet, why the government does not keep their promises? The PM exploded in rage and suggested that both politicians should better learn mathematics... .

Instead of having a smart economist to support his arguments, he had a visibly drunk (a sober person would not constantly slip his tongue) Minister of Finance Atis Slakteris (TP) next to him. The traditional number crunching, ridiculous shallowness of arguments, and his intrepid style of answering questions makes me reckon that the PM still has not learned to delegate responsibilities, and therefore he does not see the broad picture of governing the EU state. The fact, that PM announced the freeze of promised salary rise for teachers, doctors, and policemen in 2009 prior consultations with the employers confederation heads and the trade union representatives makes me to assume that the inside deals of the top notch politicians and civil servants are more important than the social stability, unfortunately. Also, rather ironically, Mrs Verza from the Pensioner's Federation anounced this week that they will probably have to call for their member's emergency caucus, because the government had lied about the determinantion to increase unemplyment benefits. Now the referendum is over, and with it the only possible way to force the MP's and ministers to govern responsibly. Thus, the only rational issue one may expect from the present coalition government is to continue to sustain their own welfare. And all this amidst expectations of striking doctors, teachers and policemen.....very, very sad.

P.S. The news just came out that the Social Integration secretariat with 48 civil servants (it had only two (!) employees in 2002, when it was founded) instead of doing their assigned work use taxpayers monies to employ private contractors for doing their job... . Also the top notch civil servants remuneration system makes the Latvian civil service the second most expensive after Cyprus, huh, uhh. This will definitely make me to write about the civil service, remuneration system and rationale of governance in Latvia next time.


nelielrīdziniece said...

“The referendum organizers did indeed envisage termination of the existing governmental practice to borrow from the social fund whenever there was a need to have a balanced budget /…./”

Though many of us seem to have known at least 2 + years ago or so that this was going on, do you happen to know *precisely* when this heinous practice began? Has anyone independently (ie., an NGO or investigative reporter) ever calculated - i.e., in lati and santīmes, plus a reasonable annual percentage rate, compounded annually - how much LV’s coalition governments thus far owes those who’ve paid into Latvia’s pension system? I don’t happen to have a choice whether or not to pay my soc.nodokļu contributions. But, it’s hard not to imagine that those who have greater options, might prefer to go back to the aplokšņu naudas sistēma, in light of not knowing in hard numbers whether LV can even meet the obligations it’s incurred.

“This will definitely make me to write about the civil service, remuneration system and rationale of governance in Latvia next time.”

Looking forward to it.

Baltic said...


Just looked into -

The initial 2008 budget was planned with 91 milj. LVL deficit while the social budget had 254 milj. LVL surplus. The amended 2007 budget planned the 268 milj. LVL deficite with the 322 milj LVL surplus in the social fund. THUS, only from 2007-2008 we may roughly calculate -359LVL ... .

I have not heard that any of the NGO's would be paying atention to this irresponsible practice, but your question made me to contact "knowledgable persons" who would lead me to the data:)

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