Things To Chew On A Saturday Morning (Vol. 4)


With economic activity contracting in 2009’s first quarter at the same rate as in 2008’s fourth quarter, a nasty U-shaped recession could turn into a more severe L-shaped near-depression (or stag-deflation). The scale and speed of synchronized global economic contraction is really unprecedented (at least since the Great Depression), with a free fall of GDP, income, consumption, industrial production, employment, exports, imports, residential investment and, more ominously, capital expenditures around the world. And now many emerging-market economies are on the verge of a fully fledged financial crisis, starting with emerging Europe.
the U.S. financial system is de facto nationalized, as the Federal Reserve has become the lender of first and only resort rather than the lender of last resort, and the U.S. Treasury is the spender and guarantor of first and only resort. The only issue is whether banks and financial institutions should also be nationalized de jure.

(source: Nouriel Roubini for


By the way, since when does leaving a third of the troops on the ground count as a pullout?

A Slap On The Wrist

Remember the Prez’s flying fiasco? To offset the damage, President Danilo Türk asked the Court of Audit to pour over the rent-a-jet procedures which ran up a bill in excess of 90,000 euros. At some point the Anticorruption Commission got involved as well and its findings (published on Tuesday) were intriguing to say the least.

Stojan Tramte (source)

Anti-corruption Commission, headed by Drago Kos, found that while the President legally does not have in influence and power in rent-a-jet and other procurement procedures (and is therefore innocent of any wrongdoing), it was his office which should have exercised more vigilance, restraint and sound economic thinking when organising a flight. Specifically, it failed to perform even basic inquires about prices with flight operators in Slovenia, thus paying far more than the market price at the time of procurement of service. Thus the commission found that the actions of the person responsible are consistent with legal definiton of corruption (failure to act leading to inappropriate use of public funds). However, the Commission also found that no criminal act was committed.

As a result Stojan Tramte, Secretary General of the Office of the President offered his resignation to President Türk on the same day. Yesterday the Prez refused the resignation, citing Tramte’s efforts to improve the procurement procedure within the Office after the affair broke out. The Prez also pointed out that the Commission found there was no criminal activity and that he has already officially reprimanded Tramte immediately after it became obvious that public funds were not spent wisely.

So the whole thing basically amounted to a slap on the wrist. As expected the Anticorrupton Commission went above and beyond the call of duty to clear the Prez of any wrongdoing, pinning the blame on people in the Office. Nothing new there. But although it was probably agreed in advance that Tramte would offer to resign and the President would refuse the resignation, I still like the fact that he indeed offered to resign. Usually in Slovenia public officials excel at shifting the blame around, but Tramte bit the bullet and took the blame.

Obviously this doesn’t make everything alright, but it does hopefully set a precedent for future cases. Both in terms of officials taking responsibility for their actions as well as in terms of actually closing a corruption charge case.

Going About It The Other Way

Yesterday pengovsky busied himself with taking apart a particular initiative to change referendum legislation. The post ended with a call for surgical precision when changing instruments of direct democracy, which implicitly means that even pengovsky recognises certain things must be amended.


I know it’s lame to re-post one’s own comment, but I really think that rather than changing the referendum legislation, the parliament should change its Rules of Procedure (article 169) and no longer ratify multilateral international treaties, where Slovenia is no the primary signatory in a form of a law, unless the treaty falls under the provisions of Artice 3a of the Constitution.

In my opinion this would be quite enough to prevent small bands of referendum raiders from wrecking havoc on key foreign policy decisions. If rules regarding the number of signatures needed to start the process were amended as well (from 2500 non-verified to, say, 7000 verified signatures), things would be just peachy.

And that’s all you need. I think abuse of referendums for one party’s political goals would diminish greatly since it would demand a greater effort on the part of the referendum bidders, leaving the state with more important referendums, where attendance would be higher as well, regardless of the day the vote would be held.

The Road To Hell Is Paved With Good Intentions

In the wake of the initiative to hold a referendum on Croatian NATO entry, changes the referendum legislation are again being mulled.

Gregor Golobič and Cveta Zalokar Oražem of Zares pour over referendum legislation (source)

For starters, just a quick update: After a week of signature-collecting, the proponents of the referendum collected only about a 1000 signatures. As you know, they have 35 days to collect 40,000 signatures, meaning they’d have to collect more than 10,000 signatures a week, meaning they’re falling well behind. Provided that an unknown benefactor does not come to their organisational rescue, the SSN’s referendum bid is as good as dead.

However, should they somehow succeed, the results of the referendum would be binding, meaning that the parliament would not be allowed a decision contrary to the results of the referendum sooner than a year from the referendum. This is an important difference from the referendum on regions, which we followed closely on this blog.

As things stand now, there are four different rerefendums possible on a national level: a referendum on constitutional changes, a referendum on international relations (held when Slovenia joined EU and NATO), a consultative (non-binding) referendum and a legislative referendum.

The relative ease of initiating a referendum bid has time and again sparked the debate on whether or not the conditions for a referendum should be toughened. It is generally agreed that of ten-or-so referendums which were held in Slovenia, most if not all were either

-dealing in marginal issues, concerning a limited circle of population
-dictate of a loud minority over a silent majority
-political ploys for circumventing the will of the parliament by a political faction that wouldn’t take no for an aswer

or any combination of the above. Thus calls for a change in legislation have been frequent are ever louder. Especially in recent days, after a marginal party presented some 5000 signatures calling for a referendum and forced Slovene-Croat relations (which aren’t peachy to begin with) to a grinding halt.

A legislative referendum (the subject of today’s post) can be called for the parliament itself, upon the motion either by the government, the proponents of the debated law, a parliamentary club or by ten MPs. In every case the parliament votes on the motion. Additionally, the referendum can be called, without the parliament voting on it, by a third of the MPs, the National Council or by 40,000 voters presenting their verified signatures. The last provisio is also the most unpredictable, as only 2500 non-verified signatures are needed to start the whole procedure, meaning that marginal groups with slightly too much time on their hands can wreck havoc in a sensitive political climate.

It was also because of this that some parties, most notably Gregor Golobič‘s Zares called for changes in the referendum legislation. Specifically, they call for a turnout quorum below which the results would not be valid, a ban on referendum on basic human rights and deciding on one or two days in a year when all outstanding referendums are to be voted on. They also called for toughening rules collecting the initial 2500 signatures.

Pengovsky disagrees with most of what was proposed, both in terms of general principles as well as in terms of specific potential problems adoptions of the proposal would create.

First and foremost, pengovsky thinks this country has had enough of systemic changes aimed at achieving a specific goal. We’ve seen enough of this during Janša’s rule. One of the more blatant example of that was the change in legislation on financing municipalities where the City of Ljubljana was deprived of 57 milion euros overnight just because the wrong man was elected mayor. The referendum legislation might not be perfect, but changing it now, because a bunch of neo-Nazis took advantage of if would be like changing the off-side rule because your defenders are not fast enough.

Secondly, the very idea of a validity quorum, although practical under normal circumstances, is utterly misguided. Since the power to rule rests with the people and it is executed directly by popular vote, it is unfathomable that this power would come into effect only after a critical mass of people would have attended the vote. Imagine that the quorum is set (for argument’s sake) at 40% turnout. This would mean that if 39,9% of people attended the referendum would be invalid and that although they took the trouble to execute their sovereign right to a vote, their vote doesn’t count. On the other hand, if 40% had attended (and, again for argument’s sake, 3/4 of votes would be in favour), then the referendum results would suddenly be valid, although only 30% of all voters voted in favour.

The other side of the coin of course is that as little as 10 percent of the voters can attend (as happened with the referendum on regions). But if the other 90 percent did not bother to attend, who’s to say that the votes of the 10 percent who attended count less? Yes, there were a number of silly referendums like this, with criminally low turnout. But it is not as if those who stayed at home did not have a chance to participate. If they chose not to, then they put the decision on the matter in the hands of their fellow citizens. Period.

Furthermore, a turnout quorum could actually lead to more unnecessary referendums rather than discouraging them. It could become the perfect tool for stalling the decision making process: calling a referendum that you know will fail, thus eliminating any fear of actual legal consequences, but nevertheless making life infinitely more difficult for the other side. Like

Moreover, I can totally imagine a scenario, when elections are nearing and a political or legal impasse is reached (such as, say, should mayors be banned from serving as MPs) which can only be solved on a referendum. A definitive decision would be is needed to ensure that elections were held on time and under such a scenario a turnout quorum would only add to the confusion rather than clear things up.

A variation of the last argument goes for the proposal to have to days a year set to vote on all outstanding referendums. This could do more harm than good, as a particular decision on which a referendum was called could be put on ice for as much as six months. Right now the “incubation” period is around 50 days. Imagine that this provision would already be in place and that (again, for argument’s sake) referendums were to be held on 21 March and 21 September. In case of Croatian NATO entry the referendum could be held only on 21 September, unnecessarily prolonging the issue which needs to be settled as soon as possible.

Banning a referendum on human rights is an altogether different proposal and I support it fully. The trick is, that it is already in place. Namely, under Slovenian system human rights and basic liberties are executed based on the constitution itself and you cannot have a referendum on that. For example, you cannot have a referendum on the freedom of speech. Were you to hold such a referendum, it could easily be defeated in the Constitutional Court. It is true, however, that someone would have to contest such a referendum, because the Court does not have the authority to pro-actively judge legislation, but only when asked to. So, banning a referendum on human rights would have no practical effect.

And lastly, the idea of toughening the rules for collecting the initial 2500 signatures: this could be very well put in place. Namely, if a proponent of referendum seriously expects to collect 40,000 verified signatures in 35 days (verified as in signed in front of an official), then he/she should have no problem in collecting, say, 7000 verified signatures in seven days. The way things stand now, a proponet of a referendum needs only a list with names, addresses and signatures of 2500 individuals which may or may not be of legal age and may or may not be Slovenian citizens. Sure, all signatures are checked against records, but there is no guarantee that someone didn’t just copy the names out of a phone book and faked the signatures. Of all four proposals this one seems the most reasonable.

The road to hell is paved with good intentions. Referendum legislation was abused time and again, by both sides of the political spectrum. It is time to put a stop to that. But rules concerning execution of direct democracy should be changed carefully and with surgical precision and not cut up with a broad sword