The Economist: Romania’s reform out of track (Apr 27, 2007)

Apr 27, 2007 (The Economist, Open Democracy)

The Economist: “Romania is destined to struggle on with an unstable minority government and tensions between president and parliament. As such, there is little reason to be hopeful that the country’s reform drive will get back on track anytime soon.” Tom Gallagher: “… the power-brokers of Bucharest will not hesitate to link up with its economic interests (particularly in the energy sector) and become a phalanx of Russian influence inside the EU.”



Romania's scrappy politics

The Economist – From ‘The Economist Intelligence Unit’ ViewsWire, April 26, 2007

Efforts to impeach the president will fail

Romania’s president, Traian Basescu, has decided against resigning and so will face an impeachment referendum on May 19th, following parliament’s decision to suspend him. The president’s popularity and the high bar set by the constitution mean Mr Basescu is likely to stay in office. Yet with Mr Basescu probably unable to force an early election, and parliament unable to oust the president or conjure a stable majority government, the prospects for a revival of reforms are dim.

A parliamentary committee on April 23rd set the date for a national referendum on the impeachment of Mr Basescu. The decision followed a vote by both chambers in the parliament on April 19th to impeach Mr Basescu for a range of offences—trying to usurp the job of prime minister, controlling all state institutions including the security forces, interfering in the law, criticising judges and ordering the tapping of ministers' telephones. In the wake of that vote, it was not clear whether Mr Basescu would proceed to a referendum or else resign and so trigger a fresh election. The following day the constitutional court, which had earlier ruled that Mr Basescu’s misdemeanours were not sufficient to merit impeachment, ruled that the impeachment proceedings were legal. It is not clear whether this altered Mr Basescu’s calculation, or whether he decided to proceed to a referendum because he was likely to prevail and this would offer a swifter end to the current crisis than a fresh presidential election. He may also have been persuaded not to short-circuit the constitutional procedure by the promise of the prime minister, Calin Popescu Tariceanu, that parliament would seek to prevent Mr Basescu from contesting a presidential election in these circumstances.

Prohibitive favourite

To ratify parliament’s impeachment decision, a majority of the electorate must vote in favour. This will be difficult, for it requires very high turnout and an overwhelming majority of votes to be cast in favour of the president’s ouster. Almost 9m voters would have to support impeachment if Mr Basescu is to be ejected from office; it is a challenge likely to prove well beyond the president’s opponents.

Around 2m Romanians of voting age work abroad and at the last parliamentary election, in 2004, turnout was just 56%. The political bickering since then has, almost certainly, increased apathy among voters. Mr Basescu therefore seems certain to return to office. Parliament had tried to make impeachment easier by voting that a president who had not won a majority in the first round of the presidential election (Mr Basescu won in the second round in 2004) could be impeached by a simple majority of votes in a referendum. However, the constitutional court overruled parliament on this issue.

Broken relations

It is difficult to imagine Mr Basescu resuming his duties chastened by the experience; it is simply not in his character. He might curb his most aggressive instincts a little, but he seems likely to continue his assault on the government with the aim of ensuring that his own party, the Democratic Party, emerges as the ruling force after the parliamentary election due in 2008.

Parliament, for its part, is unlikely to soften its opposition to the abrasive Mr Basescu. Three hundred and twenty-two of parliament’s 465 deputies voted to impeach the president. It is telling also that they did so despite knowing that a referendum would almost certainly fail. Quite simply, they could not stop themselves from seeking revenge on the man who has lambasted them in the most vociferous and contemptuous manner since becoming president. It thus appears that Romania is destined to struggle on with an unstable minority government and tensions between president and parliament. As such, there is little reason to be hopeful that the country’s reform drive will get back on track anytime soon.



Romania: the death of reform

By Tom Gallagher*, in ‘Open Democracy’, April 26, 2007

On 19 April 2007, Romania became the first European Union state ever to impeach a sitting president. The previous three months, Romania's first as a full member of the EU, had seen an escalating power-struggle over the extent to which the country's political elite was prepared to abandon serial bad habits and make itself accountable to the law.

It was not supposed to be like this. European Union entry on 1 January 2007 was the moment when Romania's tortuous transition from hardline communism was to end. The crooked businessmen who had invaded the political arena - in order to avoid retribution for transferring billions into their own pockets by engineering spectacular bank failures and looting companies made ready for privatisation - were now due to face their day of judgment.

This expectation was grounded in the series of bold reforms of the Romanian justice system launched - at the EU's insistence - from 2004 onwards. After years when this system had been extremely pliant to those in power, major prosecutions were undertaken against a string of important politicians unable to satisfactorily explain the origins of their fortunes. But instead of recognising that the years of plunder were over and it was time to salvage what they could, members of the Romanian oligarchy mounted a brazen counterattack.

The reforming justice minister Monica Macovei, a human-rights lawyer detested by the establishment, was flung out of office on 2 April. It mattered little that she had been hailed by the EU commission as the main person responsible for Romania joining the EU on schedule. On 19 April, her chief protector, President Traian Basescu, was himself suspended by parliament. This was no simple challenge by a legislature to an overmighty leader; rather, it reflected the fury that someone parliamentarians had assumed would discreetly safeguard the interests of the powerful, instead had spoken out with growing insistence about how many top fortunes were based on systematic theft while millions of Romanians survived on the edge of destitution.

The cynicism of Bucharest's MPs is matched by the dilatoriness of European Union officials. The EU had advised doubtful member-states in 2006 that reforms were sufficiently consolidated for Romania to be able to join and assume the benefits as well as the responsibilities of membership. The Romanian government's part of the bargain was to prepare an extensive set of modernising projects that would, over the next six years, unlock access to €30 billion ($40 billion) of EU taxpayers' money designated for this task. Instead, the government took a holiday from reform, as it expended energies in hounding individuals committed to fulfilling the EU's blueprint for change from their positions in the various ministries, regulatory agencies, and state media.

When EU officials have demurred, government figures have responded with mounting irritation. We are no longer a candidate but a sovereign member-state, is the message, and we resent being ordered around. In truth, there is very little Brussels can do other than impose a "safeguard clause" which prevents Romanian legal decisions being recognised in the rest of the EU.

A warped direction

On new-year's eve in central Bucharest, EU dignitaries should have recognised the warning-signs when they found themselves being shuttled between rival celebration parties: the president's in one square and the prime minister's in another. They assumed - as did the international media when it deigned to give glancing attention to Romania - that such evidence of political division and difficulty could be attributed to the contrasting personalities of the two figures whom the Romanian constitution requires to share power.

Traian Basescu is the former captain of an oil-tanker, an eloquent populist, flamboyant in style, sometimes erratic in judgment, who was narrowly elected president in 2004. Calin Tariceanu, the prime minister, is an uncharismatic and wealthy car-dealer with diversified business interests thanks to an alliance with Dinu Patriciu, who controls much of the privatised oil industry and whose firm Rompetrol is the biggest contributor to the state budget.

The political trouble began in earnest in 2005, when Patriciu was arraigned on corruption charges. Basescu accused Tariceanu of exceeding his prerogative and intervening with other officials (including the chief prosecutor and justice minister Macovei) to try to influence the case. Patriciu showed the scale of his ambition when, at the end of 2005, he launched a multi-million international lawsuit against the Romanian state for damaging the reputation of his businesses. Tariceanu's response, far from one befitting a custodian of the national interest, was to state openly that he respected the decision made by his friend.

In a political system where most parties lacked programmes and were dominated by a shifting coalition of private interests, this frank admission revealed the warped direction Romania's transition from communism had taken. Many of the leading lights in Tariceanu's Partidul National Liberal (National Liberal Party / PNL) had, like himself, been well-paid employees in Patriciu's companies. They proceeded to vilify Basescu; and cooperation with his party, the Democrats, collapsed and for an entire year - until EU entry - government became a mere holding operation.

The president vs the rest Patriciu won the oil franchise under the Social-Democrats (PSD), and in 2004 he handsomely financed the election campaign of both it and his own Liberals. Basescu's unexpected presidential victory upset hopes in other quarters that a cross-party alliance could distribute EU pre-accession and structural funds in the way that much of privatised state revenue had been allocated.

The Social-Democrtas had strenuously opposed the post-2004 reforms the EU insisted on, but in early 2007 it teamed up with Tariceanu's Liberals to depose Basescu and emasculate serious change.

A parliamentary commission of enquiry into the president's conduct was set up on 28 February under Dan Voiculescu, a media mogul who in August 2006 was unmasked by a state commission investigating the Ceausescu era as an informer for the ‘Securitate’ (a charge he denies).

The EU commission was a helpless spectator as these events unfolded; its vice-president rushed to Bucharest in March to defend the reform-minded ministers, but was effectively told to mind his own business by Tariceanu and other Liberals. At the same time, the anti-Basescu coalition was able to obtain backing in the European parliament both from the Socialist group (few surprises there) and - more surprisingly - from the ninety-six-strong strong Liberals. Its head, the British Liberal Democrat MEP Graham Watson, granted Voiculescu's Conservatives membership despite the fact that leading elected members faced trial on very serious corruption charges (Voiculescu himself was issued with an indictment on 16 April).

It is a worrying sign that some European groupings, instead of exercising a restraining role on the more unattractive parties in southeastern Europe, are lending themselves to be manipulated by them. After meeting Voiculescu, Watson declared that Basescu's suspension was justified - even though, the day before parliament had stripped him of his powers, the constitutional court in Bucharest had ruled that none of his parliamentary opponents' charges had any foundation. The court further endorsed the view that the president should have an active role in political life, not the merely ceremonial one desired by his opponents; yet on 20 April, it also ruled that the president's suspension by parliament was legal.

The naïve and the ruthless

The Romanian people will have the chance to judge parliament's actions after 19 May 2007, when a referendum required to validate the president's removal from office is held. Basescu remains the country's most popular politician by a clear margin, but almost all the media is in the hands of his opponents and Tariceanu has hired top advisers used by Republicans in the United States to advance his cause.

As for the EU, it remains to be seen when it will wake up and acknowledge that its efforts to export its values and governing methods have failed in Romania. Its methods were superficial and it never properly audited them or became acquainted with the degree to which the local power-structures were opposed to what it intended. Romania's political cartels were desperately keen to get inside the EU to enjoy the huge economic benefits membership would bring; to them, the EU is yet another entity that they need to suborn. In the attempt, they have seen close up how short-sighted, irresolute and even opportunistic some Eurocrats are in defending the values and processes that made the EU strong over the fifty years of its existence.

A naïve post-modern entity is no match for Bucharest's ruthless cartels. Without a profound and rapid rethink in Brussels, these predatory forces - now with only an isolated ex-president standing in their way - could threaten the stability of the European Union itself.

This is no alarmist statement. My prediction is that despite historic suspicion of Russia, the power-brokers of Bucharest will not hesitate to link up with its economic interests (particularly in the energy sector) and become a phalanx of Russian influence inside the EU. In that event, instead of the EU being a westernising influence on one of Europe's borderlands, Romania instead could help to corrode the EU from within.

*) Tom Gallagher holds the chair of East European Studies in the department of peace studies, Bradford University, England. His book ‘Theft of a Nation: Romania since Communism’ (Hurst & Co, 2005) is published in the United States as ‘Modern Romania’ (New York University Press, 2005).

(First bublished in www.romania-report.ro, on Apr 27, 2007)