SDS | SLEEPING WITH PENGOVSKY

Administrative Reform Packages, pt. 2: On Fiscal Rule

Continuing the series on the sweeping constitutional changes proposed by SDS, SLS, NSi and DLGV, we turn our attention today to the so-called Golden (or fiscal) rule, where – broadly speaking – the constitution would be amended to limit the percentage of GDP up to which the state could borrow against or something along those lines. The idea is fairly simple. In order to keep public spending in check, a top limit of indebtedness should be set and anything above that would simply become impossible. The whole thing makes sense on a certain level, especially if you subscribe to the Thatcherian vision of having to run the economy the was you run home finances. The problem, however, is that should Article 148 of the Slovenian constitution be changed indeeed, we’re pretty much fucked.

(source)

Namely: the last draft does not specify the percentage of GDP against which the state can borrow money, but rather institutes the demand for a balanced budget. And – truth be said – even though it is the coalition which came up with this piece of Merkozy-induced crap (or is that Merkonti-induced crap), Positive Slovenia and Social Democrats happily went along with it. That much became clear after Monday’s huddle chez Janša, despite some reservations being voiced by the two opposition parties. The gist of it: a balanced budget would be mandatory, with an automatix tax increase the following year should a deficit be run in the current year. Lovely, innit?

First and most important of all, the constitution is no place for setting budgetary and tax policy. A budget is an annual thing, basically an elaborate accounting document which is part guess-work, part wishful thinking and all politics. A budget is a government’s primary policy tool, despite the fact that as much of 60 percent of any given Slovenian budget was, is and probably will go for funding various public, state and welfare services. Constitutionally setting the basic outlines of a budget would therefore unnecessarily restrict incumbent and future governments in their policy-making abilities, especially if a tax-hike loomed every time something didn’t go according to plan.

Second: Getting everyone to agree to a constitutional change requires time and energy that would power a small-sized city. This will become even more apparent as more details of constitutional changes emerge and people’s brains finally get in gear. If changes to Article 148 are rammed through and end up having negative effects (which they will) the enthusiasm for any other, perhaps more necessary constitutional changes will have disappeared faster than capital gains in Iceland.

Third: budgets do not exist to be balanced, they exist to be well spent and invested. Balancing the budget is fairly easy. You just slash everything on the spending side until it rhymes with the income side. The trick is to keep everything going while keeping public finances (that is to say, the budget, public debt and various non-budget funds) in some sort of an order in the long term. A balanced budget will do you no good if it means you can’t pay the teachers, cops or soldiers, can’t build new roads or can’t invest in R&D (to give some examples at random).

Fourth: What if the dictate from Berl… eeeer…. Brussels changes? What if suddenly Merkonti were to realise all of a sudden that what we actually need is not across the board austerity but cutting some spending cuts combined with some pragmatic economic policies and – not compulsory, but welcome nevertheless – finally open that can of whoop-ass on the financial and banking sector (not unlike what Sweden did in the 90s and what Iceland is doing today). Will we be changing the constitution yet again? And will we be doing it over and over, every time some economic zealot gets a hard-on for one approach or another?

And last but certainly not least: if and when the political landscape is once again redrawn and the SDS finds itself in the opposition once again, you can bet your ass they will not be exactly reaching out to whatever government will come up with its own set of constitutional changes.

What the government of Janez Janša set out to do could very well be achieved sans all the constitutional hassle, simply pass a few laws and stick to a few pledges. But since this would include having buckets of shit thrown at them, it is much more convenient to point at the constitution and go “look, it says we have to do it!”. Thus, what we are seeing here is nothing more than political parties (the whole parliamentarian lot of them) shying away from their responsibilities thus letting economic ideology become enshrined in the constitution.

To Viktor Go The Spoils

Prime Minister Janez Janša submitted his list of ministerial appointments for parliament approval Friday last and the first hearings were held Tuesday, with the second batch following today, with the government expected to be sworn in tomorrow. So let’s look at who these men and woman actually are (in order of appearance):

The J Team

Ljudmila Novak (NSi) – Leader of the Christian democratic party Nova Slovenija and the only woman in Janša’s administration is set to become a minister without portfolio, tasked with keeping relations with Slovenian diaspora. The single remaining “ministry-at-large” caused quite a stir. It was created by the previous Janša administration and was tasked primarily to keep tabs on the Slovenian diaspora, both immediately across the border as well as around the world.

Aleš Hojs (NSi) – Minister of defence. Last seen as member of the board of DARS, the Slovene motorway company and a relatively high-profile party member. No-one has any clue as to why exactly he gets to oversee the Slovenian Army, but since qualified defence ministers were few and far between in this country and the armed forces are one of PM Janša’s pet peeves, it can only be assumed he will take suggestions on how to run the ministry from the very top. The key to understanding of his exact role in the office will be whom he picks or is told to pick as his state secretary (the number two person in the ministry).

Senko Pličanič (DLGV) – Minister of justice and public administration. One of the merged ministries, this will be one hell of a portfolio to run. He will be directly responsible for negotiations with public sector unions and those can be a bitch to deal with, as the outgoing government of Borut Pahor can tell you with some authority. Public administration was Gregor Virant‘s portfolio in the first Janša government and it was thought that Virant himself would take the post, quit the position of the president of the parliament and let Karl Erjavec of DeSUS take it. But apparently Virant grew cozy in that chair very quick and made Erjavec take another prestigious position.

Janez Šušteršič (DLGV) – Minister of finance. Arguably the mother of all portfolios and the most difficult right now. Also a sure-fire way for DLGV to sink even lower in public opinion polls (if that is at all possible, since they are already scoring on the low side of single digits). Šušteršič aims to cut up to 800 million euro of budget expenses in the first year alone. Since that comprises about 9% of the entire budget, shit is bound to hit the fan really soon.

Radovan Žerjav (SLS) – Minister of economy. Again, no clue as to why exactly he gets to run this particular portfolio, since he is a chemist by trade and a politician by vocation, while the economy in this country is more or less in deep shit. Even more, he was the principal sponsor of a law which prevents people who held top positions in a company that went out of business to start a new company within ten years. As with every other coalition party leader, this particular nomination seems to be more a matter of prestige than actual competence.

Franci Bogovič (SLS) – Minister of agriculture and environment. Apparently capable and knows his way around both primary fields of work. His problem is that agriculture and environment are usually at odds with each other (which is why they were kept as separate portfolios) and Bogovič might have a problem reconciling both.

Tomaž Gantar (DeSUS) – Minister of health. Former mayor of Izola municipality and former head of Izola hospital should generally be on top of things. Hopefully, he will work to improve the reform of the health system which was drafted by his predecessor Dorijan Marušič and will not go back to square one.

Karl Viktor Erjavec (DeSUS) – Minister of foreign affairs. Ah yes, to Viktor go the spoils. Failing to secure the comfy position of the parliament president, leader of DeSUS went for the next best thing. He will now become the diplomatic face of Slovenia. And just when we thought that Dimitrij Rupel is the worst that can happen to a country’s foreign policy. Karl Erjavec has zero mileage in the field. OK, so he did go to NATO and EU meetings, but seriously… As foreign minister he is expected to be proactive and have a general idea of this country’s positions long before anyone asks us our opinion. The European deck of cards is being reshuffled and it will take a master poker player to bluff a country’s way out of this one. With Viktor as the foreign affairs boss, this looks highly unlikely. But then again, he can crack a joke like no other man can. Surely that must be worth something….

Vinko Gorenak (SDS) – Internal affairs. A commanding officer of a police station way back in socialist times (today that would probably translate into senior member of security forces of a totalitarian regime), he knows his way around police and internal affairs. His problem is the fact that he also gets to exert partial control over state prosecution, which was transferred from justice to internal affairs. With Janez Janša still in court over Patria affair, it’s way too close to comfort to have a senior SDS member be able to, say, launch a special investigation into the prosecutor who is trying to get Janša convicted. If you catch my drift…

Zvonko Černač (SDS) – Minister of infrastructure and spatial planning. Seems to be close to Janša lately and has jumped in as his boss’ chauffeur on occasion. Other than having some mediocre experience in the municipality of Postojna, it is a mystery (wrapped inside a riddle, hidden in an enigma) what exactly makes Černač so special as to be awarded the newly crafted infrastructure ministry which will arguably be crucial in any and all attempts to kick-start the economy (if that is at all possible, mind you). Well, maybe he’ll be just there to make sure the right folks get government contracts. Or maybe he’ll surprise us all and actually do something. He could, for example, go about making plans for upgrading Slovenian railway system.

Žiga Turk (SDS) – Minister for education, science, culture and sport. Well, the Ljubljana city councilman (he will vacate the post tomorrow as he is sworn in as minister) has his hands full. While he was busy going over his slides in a parliamentary hearing, couple of hundred of artists and culture-related people were busy decrying merging of culture portfolio with all the other (these were previously three separate ministries) and even burned a contra-bass as a sign of protest (in case you don’t get it: the message is we rather do it ourselves than let you enjoy it). It is ironic that demotion of cultural portfolio to the level of a state secretary brought together people who would usually rather cross a busy street than meet each other on the pavement. Culture is sacred for many a Slovenian (after all, our cultural identity was formed long before we even thought of calling ourselves a nation) and rather than just being a budget item, a lot of people took this a symbolic gesture of anti-patriotism by a coalition which for all intents and purposes draws heavily on patriotic feelings. It is therefore little wonder that the minister-to-be was awaited by protesters and booed to the point of being called “a stink” by a heckler. Which, for the record, was totally uncalled for, below the belt and utterly undeserved. Protesting and marching is one thing, calling names quite another.

And finally, Andrej Vizjak (SDS) as the new minister for labour, family and social affairs. Minister of economy in the first Janša administration apparently has some background in the field so it is expected that he will not be a complete failure, although it should be ridiculously fun to watch how he tackles unemployment while finance minister Šušteršič is shaving 800 million of the budget most of which goes to Vizjak’s portofolio as it is.

At any rate, these are all the king’s men. Nobody was really impressed by the list and even Janša himself said that this is the best possible team under the circumstances. But the trick is that this “best possible team” will have to produce the “best result ever” regardless of the circumstances, lest it go down in history as “the team that couldn’t”. If Pahor’s government way fighting an up-hill battle especially in economic policy, Janša’s ministers will be forced to climb vertically. Well, all except one. It is clear that – once again – Karl Erjavec already came out on top. Question is, will he stay there or is this just the beginning of a quick and uncontrolled descent…

The Real Slim Shady – Slovenian Elections Edition

Ah well, it’s that time of the year, I guess 😀 After the hugely successful Primary Colours and its follow up, the Top Gun, pengovsky gives you yet another round-up of the political movers and shakers. Most of them you already know, a couple of them are new kids on the block. But at any rate, this should be at least mildly entertaining. Hope you like!

The Real Slim Shady – Slovenian Elections Editions from pengovsky on Vimeo.

Naturally, credits, where credits are due: Original videos are the work of their respective authors and/or entities including SDS, SD, LDS, Zares, Vest.si and Idea TV. Songs on the other hand you know, but still: Real Slim Shady (Eminem), U Can’t Touch This (MC Hammer), Money (Pink Floyd), Pass the Dutchie (Musical Youth), Ice Ice Baby (Vanilla Ice), Always Look On the Bright Side of Life (Monty Python), I Will Survive (Gloria Gaynor), YMCA (Village People), Last Christmas (Wham) and Mah Na Mah Na (The Muppet Show version).

And on Tuesday, back to number crunching 🙂

Ljubljana Elections of 2010 (Part Three: The Polls)

For the benefit of the reading public, pengovsky brings you the third instalment of yet another awesome guide. For parts One and Two click here and here respectively.

With local elections exactly a week away, some pretty important polls were ran in the last couple of days. As you will remember, Slovenia still sports this silly little legal provision prohibiting publishing – but not performing – public opinion polls a week before elections. The provision is being challenged before the Constitutional Court by Dnevnik newspaper and pengovsky hears that the court will probably strike the provision down. But be that as it may, some media are making a point of violating the law on this issue. Mladina weekly did it during the Arbitration Referendum hiatus and Dnevnik did it repeatedly, not in the least because it was the only way to actually submit a constitutional challenge (active legitimation is required to do that), but also because it makes for good copy. As in: whoops, we did something really naughty. What has the world come to, if publishing polls less than a week before elections is naughty. 🙂 It must be said, however, that some polls indeed are naugthy. Or, rather: the analysis of certain polling data is naughty and whoever did it, should be spanked.

Ljubljana. The electoral prize. (photo by pengovsky)

There were two interesting polls about Ljubljana elections this weekend, published by Žurnal24 and Delo dailies. Interesting, because they both came up with more or less the same data. The methodology seems to be a bit different, as Žurnal24 provides percentage of support at the time of the poll, whereas Delo also performs some statistical black art and provides both polling results as well as projection of the final result. Allowing for this, both polls come up with rather similar results especially in the race for the city council. However, both interpretations of polls leave – to put it mildly – a lot to be desired.

The Data

As noted, Delo’s poll provides both actual polling data as well as a projection of the final results. According to this poll incumbent mayor Zoran Janković is projected to pick up 66,5 percent of the vote, beating the shit out of, perhaps surprisingly, Mojca Kucler Dolinar of NSi with 11 percent of the vote. Third place would go to SDS’ very own Zofija Mazej Kukovič who is projected to pick up 8,1 percent, thus beating Miha Jazbinšek in the fourth place by a single percentage point. Not at all a promising prospect. Things get more funky on the City Council front. There the List of Zoran Janković is projected to pick up 33 percent of the vote, while Janez Janša‘s SDS is looking to pick up some 17 percent. They’re followed by Social Democrats (10,2 %), DeSUS (9,5%), LDS (8,3%), NSi (4,3%), Zares (3%), The Greens (2,7%), List for Clean Drinking Water (2,3%) and SLS (2%)

Žurnal24’s poll doesn’t do projections and it also deals with a lesser number of candidates, but – published a day before Delo’s poll – the results are similar. In this poll mayor Janković registers “only” 54 percent of support. He is followed by Zofija Mazej Kukovič with 15 percent of support. Third place goes to Mojca Kucler Dolinar with 9 percent and Miha Jazbinšek with 6 percent. Results for the City Council are a bit more in line with Delo’s poll. According to Žurnal24 the List of Zoran Janković enjoys a 31 percent support, followed by SDS with 15 percent and Social democrats with 6 percent.

Knowing jack shit and getting away with it

While the polling data seems to cross-corroborate, analyses in both newspapers show that people who wrote the respective articles know jack shit about the issue at hand. The author of Žurnal24 article thus writes about the possibility of a second round in Ljubljana mayoral race.

Pardon? Zoran Janković scores an ass-whooping 54 percent support, leaving his main rival in the dust with 15 percent and the paper writes about the possibility of a second round? WTF?!? I know that the guy has to pick up 50%+1 vote to win in the first round, but do your homework, goddamit! There’s a 16 percent gap in published results, which (presumably) is divided between the rest of the candidates and the “undecideds”. That’s a lot. Neglecting the fact that the paper didn’t publish the percentage of undecideds, those 16 percent should increase by one quarter (for another four percent) in order for Janković to be forced in the second round. It ain’t happening. But if Žurnal24 thinks their poll could be off by 4% in a race where one candidate has light-years of advantage, they might want to consider changing their pollster.

Speaking of polls being off, Delo doesn’t have the best of track records in Ljubljana either. Four years ago, when Janković’s List won 45% of the vote and thus won an absolute majority in the City Council, Delo’s last poll recorded a meagre 6,5 percent of support for the List of Zoran Janković, while the man himself was just short of the 40 percent mark. Now, presumably Delo’s pollsters got better in the last four years (that’s right, Delo doesn’t outsource public opinion polls, one of the few pluses this paper hasn’t wasted in the past few years) but their analysis still sucks. To their credit, Delo doesn’t have a problem with projecting Janković’s victory in the first round, but their analysis of the City Council vote is about as stupid as they come. Namely, the paper writes that it can very well happen that Janković’s list will have a hard time forming a coalition and may even end up in the opposition.

Exquiz me? Baking powder? You project one group to win a third of the vote and then you say virtually all the other groups in the council, both left and right, will refuse to cooperate and will gang up on the winner? What are you on, ferfucksake. One: do you really see SD, Zares, LDS, the Green party, DeSUS, SDS and SLS joining forces to shut out Janković’s list? And keeping the deal for the next four years? Two: what purpose would that serve? The mayor is not elected (nor can he/she be replaced) by the City Council but directly by the people. He represents the executive branch of the city and will therefore hold office regardless of the balance of power in the council. And three: Even if such a broad front were to be established, it would have no real meaning, as the mayor is not driven out of office for losing a vote, nor are most decisions in front of the council ideological or of a nature that would otherwise demand a vote along position/opposition lines.

Interpretation

Let me state for the record that pengovsky has no problem either with Janković having to go to the second round or with his list being “in the opposition”. If it happens, it happens. However, it my firm belief, based based both in my knowledge as well as experience that both of these projections are false. For the incumbent mayor to go to the second round, all the other candidates would have to receive among them at least 50% of the vote. With the runner up registering only mid-teen numbers, that is about as likely as getting wood while your bladder is still full of cheap beer. Ain’t gonna happen. Ditto for the city council.

However, results for the City Council are a bit tricky. 33 percent is a lot. But it still is some way from the 45% treshold which gave Janković an absolute majority. 12 percent ain’t peanuts and if we for the moment consider the polls as more or less accurate it will be mighty difficult for Janković’s list to make up for the difference in the five days remaining. But… (there always a butt involved)… Pengovsky noted time and again that voter turnout and vote dispersal will be crucial in the final tally.

Electoral mathematics

Out of some 270,000 Ljubljanchans, about 224,000 are eligible to vote. With an estimated voter turnout of 62 percent (as per Žurnal24 article), the number of votes against which the final results are calculated drops down to 139,000. Furthermore, the percentage needed to win one seat in the City Council historically revolves around 2 percent. Anything below that are votes counted, but lost. And this is where the fun starts. If we accept Žurnal24’s predicition of voter turnout, Delo’s prediction of election results and historical threshold data, we can conclude following:

Of 139,000 votes cast, some eight percent or 10,800 votes will get lost to lists ranking below 2 percent threshold (2 percent equalling approximately 2700 votes). This will in turn increase the number of seats won by more successful lists and parties. With the data at hand this puts the List of Zoran Janković closer to their stated goal of again winning and absolute majority, but it doesn’t take them all the way. By that same pattern we should see some gains by SDS and SD, possibly even DeSUS and LDS. The further down the list we go, the less effect this quirk in the proportional voting system has.

As things stand now, Janković’s List is poised to win some 19 seats (thus losing four), SDS is to win 9 seats (gaining one), Social Democrats have their sights on five seats (gaining one), DeSUS is looking at five seats as well (a staggering four-seat gain), whereas LDS is set lose a seat and end up with four. The remaining three seats should go to Zares, The Green Party and the List for Clean Drinking Water.

Analysis

Pengovsky thinks this will not stand. The thing that stands out like a sore thumb is a huge four seat gain by DeSUS. There’s no particular reason why this should be so other than the fact that the party is playing harball on the national level, trying to prevent a freeze on pensions. But DeSUS has had good polling results just prior to elections before (notably in 2004 and 2008) but got a bit of a cold shoulder on voting day. Pengovsky thinks this is likely to happen again.

Also, the List for Clean Drinking Water is suspect as well. True, they made their case opposing the construction of a parking lot below the Central market, but there’s a crowd at that particular issue, with SDS, NSi, SLS as well as The Green Party in the form of Miha ‘Jazby’ Jazbinšek canvasing for votes and there’s not enough to go around. SLS is also problematic, as is Jazby himself, but his ability to land on his feet is astounding.

Projection

This Sunday pengovsky projects the List of Zoran Janković the overall winner of the City Council elections, but with 21 seats they will stop just shy of an absolute majority (23 seats of 45). They will be followed by SDS with 10 seats, SD with 5, LDS with 4, DeSUS with 2 and Zares, SLS and the Green party with 1. In the mayoral race, pengovsky projects Zoran Janković winning in the first round with 56 percent of the vote (I placed a wager on this result. A friend says 65 percent).

But still, there are five days of campaign remaining. A lot can happen. A lot will happen. So watch this space. 🙂