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May 24, 2022

We won’t have an economist as president

Opinion polls in Romania present such different results about the candidates’ chances in the presidential elections that almost nobody trusts the information they provide. Certain newspapers or internet news sites even announced they won’t present any opinion poll until elections.

The figures that reflect the voting intention are radically different, depending on the party or institution that ordered the various polls. Not so long ago, sources which preferred to stay anonymous unveiled that one single percent point for the preferred candidate, incorrectly added by the pollster, “costs” those who ordered the poll some EUR 5,000.

After all, this is party money and those who paid it probably consider a biased poll is worth the expense. Yet it is certain that all recent opinion polls coincide at least with one respect: almost two thirds of the population thinks Romania goes the wrong way.

However, the main candidates – Traian Basescu, Mircea Geoana and Crin Antonescu – apparently read only those figures in a poll that refer to their individual chances to get the presidential chair. Campaign speeches are reduced to accusing the rivals and emphasizing their responsibility in starting the political crisis, and stating their own will to impose a candidate for the position of premier. The president wants to impose his will upon the opposition-controlled Legislative, while the Parliament supports its own candidate, Mr. Klaus Iohannis. No concession is made, but everybody incessantly speaks of political crisis. On the other hand, the economic setback – the real crisis that threatens each Romanian’s life – is left to the background. The candidates thus make a fatal mistake in the heated electoral debate, which they repeat each time they appear on TV.

President Traian Basescu nominated Lucian Croitoru as premier, because he is a worthy economist, saying that Romania needs an economist as chief of the Cabinet during these troubled times, to negotiate with the International Monetary Fund (IMF). This is a strange idea, given the talks with the international financial institutions fall in the responsibility of the Finance minister. One thing is for sure: we won’t have an economist as president, though it is rather in this respect that “improvements” are really needed. An economist would truly understand Romania’s difficult situation and the dangers we risk at this moment. An economist president wouldn’t say the country does not aim at getting out of crisis on its own, because it is unable to do so. Nor would he say that the accord with the IMF must be amended, when it isn’t even clear whether it will be carried on. These ideas, and others that are similar, were stated by Traian Basescu, but the other candidates too have problems when it comes to economic issues. Crin Antonescu claims Romania does not need an accord with the IMF. Perhaps he would be right, if the Liberal governance of 2004-2008 managed more carefully the resources of the state or if in 2009 the Boc government had taken the painful – but necessary – measures to curb public spending and allocate resources to sensitive fields, to stimulate job creation and related industries. None of these measures was taken and Romania reached the point where it must survive from month to month on money from the IMF, the European Commission and the World Bank. In his turn, Mircea Geoana claims his party will do whatever it can to pass the Budget for 2010 in Parliament, but he makes electoral promises with no financial support, which might worsen the budget deficit agreed with the IMF experts. And the examples can go on…

Actually, as we can see things now, from an economic point of view, it does not matter too much who will win the presidential elections. President Traian Basescu clearly proved his options and abilities so far. Analysts are almost unanimous in saying that his economic knowledge is close to nil. Liberal candidate Crin Antonescu too is rather weak with this respect and does not seem to realize that, starting January 1st, Romania might be unable to pay pensions and salaries in the public system. Furthermore, he even plans more tax cuts, as an economic stimulus, even though the major problem for the country, at this moment, is precisely the dwindling incomes to the budget. Coming to Mircea Geoana, any approach that would involve social measures sounds like a recipe for bankruptcy.

Yet, all candidates and the parties behind them seem to understand that the failure to receive the loan instalment from the IMF can be catastrophic. Despite the unusual goodwill it proved toward Romania – in the summer of 2009, when it accepted an increase of the budget deficit target from 4.6 to 7.3 pc, and in dispatching the mission of evaluation without a firm Cabinet in place – the IMF still has a clear message for us: if the Parliament does not pass this year the Budget for 2010, with the parameters agreed by both sides, the Fund won’t release the loan instalment. This is what made politicians so willing to pass any form of budget, in the agreed conditions, even by the dismissed Boc Cabinet. On Wednesday, the Parliament urged the interim government to present a draft budget. Anyway, the next premier will be able to make budget rectifications as he pleases, on condition that he preserves the macroeconomic parameters.

In the absence of major economic reform, today’s measures can only delay the inevitable. The IMF money will only extend the agony of a collapsing economy, allowing the government (any government) to pay salaries and pensions. But without reform, economy seems incapable to get past the limits imposed by the absence of long-term economic strategy. This is the natural consequence of an anarchic economic development, lacking both vision and finality, in a country unable to build motorways as well as hospitals. The present crisis may offer the chance of enforcing long-delayed reforms. None of the player-president, coach-president, or popular president alternatives is sustainable now. Unfortunately, as mentioned earlier, we do not have the chance of seeing an economist-president, someone who would know what are the limits of political game versus real life.

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