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June 26, 2022

Our crisis

It has always been this way: when something goes well, everyone tries to take the merit, but things go bad, nobody wants to admit being guilty.

We are witnessing, these days, an avalanche of accusations, all over the Romanian politics. The simplest solution (also to everyone’s benefit) would be to say that the present crisis is not ours. It came from the USA. Period! Reality, however is more complex, so supporters of the ruling coalition found the way to dissipate responsibility for the present economic debacle. Lack of money, tax evasion, a poor degree of collecting money to the state budget, the high number of people working in state sector – these are no recent issues, as they have been inherited from the last years of the Liberal governance (2007-2008), and even from the time of the previous Social-Democratic governance.

So, it’s the whole political class, rather than just the Boc government, that must take the blame for authorities being forced to cut salaries and pensions now, because all the parties came to power during the last decade.

At least that’s what the supporters of the acting Democrat-Liberal government and those of President Traian Basescu are saying.

At the opposite end, the Liberals and Social-Democrats reject the accusations and, in their turn, want to sack the Cabinet, for being unable to find solutions and avoid the tough measures that will amputate salaries and pensions. The Liberals say they had to create new positions of civil servants in the past, because they were asked by the EU to form the Local Police and other structures. And the money they spent went to investments, rather than being wasted, they add. However, PNL and PSD avoid accusing each other, as the last two years of the Liberal governance were only possible with the support provided by Social-Democrats to the Tariceanu cabinet in Parliament.

An equally interesting fight is being waged in the media. Part of the press supports any measure taken by the acting cabinet, no matter its effects, while other media see a proof of stupidity in every decision made at the Victoria Palace. And the explanations keep coming. For example, a political magazine explained, these days, that the harsh austerity plan unveiled by president Traian Basescu, with its brutal salary and pension cuts, is just the consequence of the electoral presents given in 2008. Two years ago, everybody had to be seduced: civil servants, retirees, political partners, local barons, friends or donors. Nobody was willing to make a lucid and simple calculation whether these gifts can be paid in the long run.

As we mentioned lucidity, the author seems to ignore the fact that, back in 2008, then premier Calin Popescu Tariceanu was the only voice warning it would be impossible to hike salaries in the education sector by 50 pc (one of the main topics of debate at that time), while the Democrat-Liberals (then in opposition) and President Traian Basescu strongly claimed the contrary. What happened is well known to everybody: not only were authorities unable to pay the salary increase, but they are even forced now to sack teachers and cut salaries by 25 pc. On the other hand, the “opposition” media point the finger at the electoral promises made in 2009, before the presidential elections. The head of state, himself, assured us last year that we got past the peak of the crisis and were on the way of recovery. He even reiterated the idea in his address for the New Year 2010. According to the press, the fantasy promises and the measures delayed in 2009 (which would have averted, or at least alleviated the present crisis in the economy) are the reasons behind today’s problems. We are paying the price of the president getting re-elected, says the opposition press. If unpopular measures were taken last year, Traian Basescu would not have been reinstated as president. So, despite being aware of the hard times ahead, Romania delayed the tough measures and chose to take the “unfortunate” loan worth EUR 20 bln from the IMF, World Bank and the European Commission.

If things are like this, what should the average Romanian understand? In fact, the real purpose of the struggle in the media is to puzzle the population. In the end, fed up with the interminable bickering on the political stage, the citizen will end either by saying that politicians are all the same (so, what good changing the present rulers?!), or by getting weary of what he sees and not going to vote from now on (which leaves the ruling power at a relative advantage, sparing it from a negative vote).

In such a troubled situation, whom should we believe? Political analysts have their preferences, the same as economic experts, and statistic data receive various interpretations, leading to the same uncertainty.

Through the years, the Central Bank was the basis of Romania’s stability. In the ‘90s, it avoided – with much effort – the possibility of Romania defaulting on its payments. Very discreet in its approaches, the BNR administration only launches, every now and then, signals meant to warn those “in the know.” It is not its role to say what can be made, in terms of politics. But when the economic policy goes haywire at state level, the Central Bank gets in the spotlight, even though discreetly, only for those who want to understand. As we are faced with a critical situation, of late, media started even to speak about BNR Governor Mugur Isarescu taking the reins of the Government. Isarescu rejected the proposition and stressed that governance must be politically assumed (an allusion to the electoral promises made by PDL in 2008 and 2009). As the governor won’t come out to settle political disputes, it is his counselor Adrian Vasilescu that does it, in his didactic and economic way. In a recent interview with ‘Gandul’ newspaper, Vasilescu spells it out: “There has been known, for a number of years, that salaries must be cut. The bad news is that the initiative has nothing to do with overcoming the crisis, because the decision to curb state’s expenses with its own employees is unable to restart the economy and only rights a historic wrong. I might say it has been known for a few years. Adjustments and cuts were always needed. Sometimes they were made, sometimes not. They were not made in electoral years, and this is no news. Voices from the Central Bank, even the governor, warned about this – I clearly told you a moment would come when we’ll have to draw the line. And it has come,” Vasilescu concluded.

In other words, today’s opposition has its share of responsibility, as long as the situation has been known for a few years. But PDL too cannot be exonerated from responsibility: if things became clear years ago, how could it make the fantasy promises in the campaigns for the general elections of 2008 and the presidential ballot of 2009? The Democrat-Liberals and Traian Basescu won the elections because of these tempting commitments…

For Romanians, the sands have run out, so they’ll take it to street and go on general strike on May 31. It is still to be seen if the sands have also run out for the Boc cabinet and everything related to its existence.

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