Slovenia | SLEEPING WITH PENGOVSKY

A Landslide Win for Danilo Türk

According to the exit polls, Danilo Türk won the second round of Slovene presidential elections in a landslide. He received an anstonishing 70 percent of the vote while the winner of the first round Lojze Peterle received 30 percent, faring far worse than in the first round. Turnout was criminally low – just below 50 percent.

Danilo Türk after the first electoral roud (photo: www.daniloturk.si)

Pengovsky predicted a much more close result, but it seems that the smear campaign only presuaded the undediced voters to support the victim of the campaign, while it more or less failes to galvanise the political right close to Lojze Peterle.

I will comment on the result posthaste, but for starters – just a few thoughts:

-This is a massive warning sign for Janez Janša. I suspect plenty of votes for Türk were actually protest votes agains the government of Janez Janša and its policies.

-Add to that an article ran by Croatian daily Jutarnji list, clamining that Janša and his war buddies made some 150 million euros in arms dealing immediately after independence and you can see that today is not a good day for Janez Janša

–Smear campaigns do not work in Slovenia

-Türk set a new electoral record, as he got ~~more votes~~ a higer percentage of the vote than the legendary Milan Kučan (althoug Kučan won at a much higher turnout and consequently with a higher number of total votes cast).

EDIT @ 2100 hrs: In his first statement Lojze Peterle put the blame on his humiliating defeat squarely on Janez Janša and his government. And he’s not far off. This election was also a test for Janša’s government and he flunked it big time. The question of course is if Janša will get the message. And (if he will), is there enough time for him to change the downward trend. The political left if right now of course euphoric, but it may be that Janša & Co. are about to spiral out of contol. Just to give you two examples:

Janša failed to support Peterle with more than just a quick tap-on-the-back. This will not go down well with Peterle’s Nova Slovenija, which until now was a very reliable coalition partner. And – perhaps even more importantly: More than one third of voters of Slovenska Ljudska Stranka (another coalition partner) voted for Türk. This of course means that the two parties will become increasingly independent from Janša, which means that good old JJ will have a lot on his hands until next November, when parliamentary elections are to be held. And his grip on things is slipping, it seems. Namely, Slovene Press Agency STA (government owned and controlled) ran the already mentioned article about Janša’s arms dealings. Which means that someone wasn’t paying attention and that heads will probably roll.

At this moment Janša’s response it all that’s misisng. But we’re not holding our breath. He would do well to congratulate the new president-elect, but (knowing Janša) he’s just as liable to question the legitimacy of the elecoral result, due to low turnout.

Incidentally, Janša also suffered defeat on referendum on the privatisation of Triglav insurance company. And also incidentally: the new president will probably be sworn in in mid-December

Constitutional Bitchslapping

The political turmoil of the past few days combined with my severe cold has prevented me from blogging about a very important development in Ljubljana- Slovenia relations. Namely: the Constitutional Court has finally ruled on motion of the City of Ljubljana (supported by three other municipalities) to repeal several articles of the Law on Funding of Municipalities.

The inner corridors of Constitutional Court of the Republic of Slovenia

Now, some of you may remember this post, or even this post, when the City of Ljubljana filed a request to review the constituionality of the said law. So you now have the perfect opportunity to see expedience of Slovene judicial system almost first-hand

The fun part is that this actually is expedient. The Constitutional Court took slightly less than a year to rule on a very tricky matter. I won’t go into details, but the gist of it is that the Court decided that theyn (Janša & Co.) pursued a fair goal (spreading funds over several municipalities) but employed unfair (unconstitutional) means to achieve it. Not in the least by spreading funds so thinly that it made most municipalities actually more dependant on the state that they already are. The added “bonus” was that these funds were originally earmarked for the City of Ljubljana, but suddenly the capital was left with virtually nothing.

So, tehnically, the unconstitutionailty was twofold: firstly the effect of the law violated the constitutional provision that municipalities should be as financially independent as possible, and secondly that the change was immediate and absolute, without a transitional period (unconstitutionality here being that the government arbitrarily worsened the plaintiffs’ positions)

And finally, the Constitutional Court ruled that the Parliament must amend the said law within a year.

So what does it all mean politically?

Well, first and foremost, it is a huge political vicory for Ljubljana Mayor Zoran Janković. His political stock went through the roof, but unfortunatelly for him, all he can count on is to cash in on it furhter down the road. Because he ain’t getting the money. At all.

As I said, the Court gave the parliament a year to ammend the law, which puts the deadline for ammending the law well within 2008 election period. Add to that the fact that the state budget for 2008 is already passed and that the government only yesterday passed the 2009 budget proposal, and you can see that city coffers will not see the 60 milion euros that the government has unconstitutionally taken.

But more importantly, this ruling basically kills the proposed regional legislation which was on ueasy footing even before the ruling, as no political decision could be reached on the number of regions Slovenia is to be divided into (the numbers varying from six to absurd twenty-five, with government proposing fourteen). But with this ruling the Minister for Self-Government Janez Žagar is basically dead in the water.

Alongside Žagar, Finance Minister Andrej Bajuk took a beating as well, as it was his ministry which drafted the unconstitutional law which was more or less aimed at throwing cash at rural municipalities whose inhabitants were more likely to support the current government. On the other hand, however, Minister for Civil Service Gregor Virant (chief government negotiator with Mayor Janković) can take silent joy in the ruilng, because he admitted somewhat hastily in February that Ljubljana was wronged by the law (consequently, PM Janša sent lightning bolts in Virant’s direction) and – perhaps more importantly – he was locked in a bitter political struggle with minister Žagar, who wanted to change the structure of the entire civil service en passant while setting up regions. Virant, who – admittedly – has done a pretty good job at bettering the civil service, obviously went apeshit over it, but was until now unable to counter Žagar effectively.

And last but not least – the whole thing is a serious blow to Prime Minister Janez Janša, who exactly a year ago suffered a humiliating electoral defeat in Ljubljana and is now being bitch-slapped by a political newbie Zoran Janković. (do check out the link!). And he’s set for some serious asswhooping this Sunday unless the “october surprise” yields unexpected results.

But the PM’s got more important things on his mind right now. As you read this, he’s in China, asking “who’s president and when’s prime minister“. But not to overdo the joke, the fun part is that Janša (a former hardcore communist with residual dicatorial tendencies) is visiting only remaining communist superpower with emerging capitalist tendencies. It must feel quite bizzare for all of them 🙂

Who Will Mount Triglav?

Sunday’s elections will not only be about choosing a new president. The good, the bad and the ugly will also have us vote on a referendum concerning privatisation of Triglav Insurance company, which is at the moment state owned: a good 66 % of it are owned by KAD and SOD managed – but not owned.

HQ of Triglav Insurance

Triglav Insurance Company was namely another socialist/self-management attempt at reaching past capitalist concept. It was basically a mutual insurance company, with insurees becoming owners as well. Uppon the dissolution of (and disisllusionment with) socialism, Triglav became a typical incorporated-but-government-owned company, so typical for transitional economies. But there was a catch. Noone really knew how much the company was actually worth, because noone exactly knew how much money people have put into the company in the past fourty years.

So, when privatisation began after 1990, it soon became clear that a) Triglav is a goldmine and b) the topic of its value is as explosive as a truckload of ~~natrium~~ soduim near a hydro-power plant. So no government wanted to touch it until it was absolutely necesary. This burden thus fell on the former government of Tone Rop, who (curiously enough) began his carrer in top governmental ranks as state secretary (underminister) in charge of privatisation. So he knew exactly that all hell will break loose eventually. And so it did. His government prepared what was then considered a half-baked attempt at privatising a portion of Triglav, but they did it so late in the game (it was just prior to elections) that noone took it seriously. Most of us even though that they’re just trying to stuff their pockets just in case they lose the elections. Which they did. Lose the 2004 elections.

The plan called for actuall transfer of government owned portion of Triglav to KAD and SOD (which until now only managed but did not own this share), the idea being that the dividends would be used to keep the pension system solvent.

The new government immediately pulled out of the plan, saying that it needed to reevaluate Triglav’s value. And sure enough, they came up with a more than double the value. The mathematics of both calculations are somewhat fuzzy, though. Anyways. The incumbent government basically came up with the exact same plan, but what it failed to include was a provision forbidding KAD and SOD to sell Triglav on.

The government obviously says that it has no intention of selling Triglav, but history teaches that if something can be done, it will be done. And selling the biggest insurance company is not a smart idea.

EDIT: Just so that there’s no misunderstanding – I don’t have a problem with KAD and SOD owning Triglav. I do, however, have a problem with selling family jewels. There is more than enough competition in the market and I strongly support the idea that Triglav’s profits should be partly used to finance the pension system. And I’m not sure that the previous government didn’t want to sell Triglav, either.

Smear Campaign

So, the second round of presidential elections is five… no… four days away and the Peterle Campaign has finally decided to hit below the belt. Namely: during Monday’s debate Lojze Peterle drew a disctinction between himself and Danilo Türk, saying that the latter was still representing Yugoslavia at UN HQ in Geneve in 1991 while he (Peterle) was among those who put their heads in a bag and went for broke during preparations for Slovene independence.

The “incriminating” document

In normal circumstances this would have been a bomb-shell… However, what Peterle and his team conveniently forgot is the fact that Slovenia was recognised by the EU on January 15th 1992 and that it became a member of the UN in June 1992.

So the fact that Türk was technically a part of Yugoslav delegation means that he was resorceful enough (and the UN permissive enough) to find a way to operate in the institution, albeit as a member of the already defunct Yugoslavia. Just to give you a comparison: foreign minister Dimitrij Rupel (whose ministry leaked the above document) attended an OSCE conference at about the same time (pre-1992) as a member of the Austrian delegation and yet I don’t see or hear anyone claiming that he – say – wanted Slovenia to become an Austrian province.

This move by Peterle carries all the trademarks of a panic-attack, not unlike the one in the final stages of municipal elections in 2006, when government of Janez Janša leaked documents supposedly damaging to the then-front-runner Zoran Janković. The documents turned out to be a load of bollocks and Janković went on to become mayor of Ljubljana with a landslide 63 percent of the vote. And those documents were much more substantial than today’s document aimed at bringing Danilo Türk down a peg or two.

While this might galvanise the nationalist element within the political right, it might blow right into Peterle’s face by getting Türk additional sympathy votes of people who don’t care about either candidate, but hate low blows. And there are a surprising number of those out there.

Head-2-Head

The second round of Slovene presidential elections will be held on Sunday and yesterday saw a first head-to-head debate between Lojze Peterle, winner of the first round and runner-up Danilo Türk. The former is supported by Social Democrats, Zares and DeSUS, while Lojze Peterle enjoys support of the ruling right-wing coalition (save DeSUS, which is actually left-wing, but we won’t go there today).

Who will be the king of Sloveve hearts? (photojob by pengovsky, animation by dr.filomena)

According to the law, last polls can be conducted a week before election day and those published on Saturday (and some published on Monday in a clear breach of the said law) showed a not-so-surprising, but nevertheless dramatic turning of tables. Namely: Danilo Türk who only barely made it to the second round, defeating Mitja Gaspari by a fraction of a percentage point, now has an enourmous lead over Peterle. While the latter is supported by some 30 percent of those polled, Türk enjoys a hefty 60 percent support.

Some are surprised, but needn’t be. Although I didn’t cover presidential elections on this blog, I always maintained that Peterle’s only chance of becoming president is winning in the first round. If it comes to the second round (as it did), Peterle stands virtually no chance at all. While he lead a marvelous campaing throughout the year, Peterle fumbled it at the end, when apparently Mitja Gaspari and Danilo Türk (with a little help from the incompetent government) mobilized enough support to chip off a huge chunk of support from Peterle. I’m not saying that these votes transferred directly to them (most likely they went to fourth-placed Zmago Jelinčič of Nationalist Party), but point is that Peterle didn’t get those votes which most likely cost him an entire election.

Because he was deemed a favourite (and failed to deliver), Peterle is now on the run, and conesquently he panicked. He changed his campaign manager Marko Pogorevc and took charge of the campaign personally. Which is of course a clear sign that he’s in deep shit. He also announced that his rhetoric will be much more resolute than in the first round, which means that he admits to making a mistake in the final stages of the campaing. But he’s making an even bigger mistake now, because yesterday he came of as a sort of a bully, jumping and snapping at Danilo Türk.

The main difference between the two candidates (besides their basic political outlook) is the fact that Peterle was always thought of as the “more presidential” of the two and has failed to deliver. Danilo Türk, however, was always considered as a “replacement candidate”, when Borut Pahor of the Social Democrats finally decided to challenge Janez Janša for the more powerful post of Prime Minster. Türk, however, thusfar delivered (contrary to many expectations, including my own) and opinion polls clearly reflect that.

I don’t think I need to explain who or why is my favourite (take a close look at this blog, if you can’t figure it out ;)), so let me just make an electoral prediction:

The way things stand now, Danilo Türk will become the next president with a majority of 55% percent of the vote. Peterle will make a run for it. It will be a valiant effort but it will be too little too late.

It Took a Jew To Give Protestants a Holiday

Just a quick historical note, since today is Reformation day (national holiday), which means that save a tsunami on the river Ljubljanica, a collapse of the government or similar natural disaster… I ain’t doin’ notin’ but chillin’ 😉

Lev Kreft, the man who gave Protestants their holiday

Reformation day was created in memory of Slovene protestants in 1500s, most notably Primož Trubar, who wrote the first ever book in Slovene (he also wrote the second ever book in Slovene). But Slovenia almost forgot this great man and the only indigineous religion of this land. It was up to the man in the picture, Lev Kreft of Social Democrats who – when the parliament was just about to pass the Law on National Holidays, to stand up and note that there is a shitload of Catholic holidays but not a single Protestant one. This was passed and thus, ever since the mid-90s, 31 October is known as Reformation Day.

Funny thing is, that Mr. Kreft is of Jewish faith and it was up to him to stand up for the Protestants. Obivously, noone thought of returning the favour.

Save The Pension Fund!

The future of pension funds (source)

NOTE: As crni noted in the comments, Slovenia does not have a pension fund as such, but rather a pas-as-you-go system. So, do me a favour and in the entire post for “pension fund” read “pension system”.

As I promised to my favourite moose yesterday, I have a thought or two on how to keep the pension ~~fund~~ system solvent for the forseeable future.

The situation in Slovenia today is, that statstically 1,1 employed persons support one pensioner. Only twenty years ago this ratio was 1,7:1, which shows that the population is a) rapidly getting older and b) that there is not nearly enough employment to support the pension fund. The government(s) is (are) trying to cope with this huge problem basically in two ways: One, cutting down on pensions (mostly by trying to keep them for rising together with inflation), and two, by making people work longer with a prospect of a much lower pension.

Which is all fine and dandy, with the slight exception that these measures only postpone the problem and do not slove it at all. Because, on the other hand, we have an increasing number of graduates who cannot find a job, which means that they cannot get a credit line to, say, buy an appartament, which in turn means that they cannot start a family, which in turn means a slow but steady drop in child-birth, which finally brings us to out starting point of an ever older population which needs those who are employed work longer for less pay to support both students and pensioners.

What few people seem to take into account is, that today, when people retire, they are still fit – both mentally and physically. Which of course means that they could still work. So there I was, one fine Tuesday morning, thinking what if we forced these people to retire with a more or less full pension, but then re-hired them part time, just like students.

I know this sounds like a crack-pot idea, but think about it for a second: If you force people to retire at a certain age, you spin the wheel of the labour market a bit faster, perhaps freeing a job or two (or a couple of thousand), making room for young people to get their first job. It needn’t be a glorious job, just something to get them started and allow them to start accumulating work-experience.

At the same time, we need to create another parallel labour market – like the student labour market, but this one exclusive to pensioners. The trick would be that the pensioners could keep all the benefits of a pension, but still work as much (or as little) as they would like to and would not get taxed for it – unless of course their income from this source would surpass a certain census – this tax would have to be quite heavy, because we need to destimulate employers hiring only pensioners and students. Thus, the pensioners would still generated added value, but inside a different labour market, freeing up space in the “real” labour market for young people, who had just left the student labour market.

Of course all this is just a set of nifty ideas, not based on a single calculation or a model. I’m not an economist and I don’t have the foggiest how to do this. I basicallly suck at math 😀

So, what I need…. Scratch that… What this country needs is somenoe to throw numbers at these ideas of mine, to see if they are economically viable. Because if they are, it could be really fun. And if they’re not…. well they still are nifty ideas 😆

Any candidates?