Tuesday, June 20, 2006

The populist choice

Jun 19th 2006
From The Economist Global Agenda

Victory for a left-leaning opposition party in Slovakia is a blow for one of the best-regarded reforming governments in the post-communist world

AP - Reuters
AP - Reuters

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SPECTACULAR success followed by tragic failure. That might seem the verdict of the weekend’s general election in Slovakia, where one of the best-regarded reforming governments in the post-communist world was booted out of office amid big votes for left-wing and populist parties.

Both parts of the judgment need qualification. Slovakia’s coalition government under Mikulas Dzurinda had indeed done well in stabilising the economy, attracting foreign investment, cutting taxes and boosting growth. But it had not managed to reform public services convincingly, or to convince voters that the benefits of prosperity were going to the poor as well as to the rich.

And the election outcome is not as bad as it looks. It is true that the left-wing populist Smer (Direction) party of Robert Fico was the winner, doubling its share of the vote to win 50 seats in the 150-member parliament. And it is true that Smer’s programme is both opaque and ominous. The party is against Slovakia’s successful flat tax, and favours more government intervention in the economy.

But there are encouraging bits of the result too. Mr Dzurinda’s freemarket conservative party did better than expected, polling 18.4%. That will give it 31 seats in the parliament. Its allies did well too. A party representing the country’s large Hungarian minority gained 20 mandates, and a centrist Christian-Democrat outfit won 14. Unfortunately for Mr Dzurinda, two reform-minded small parties failed to pass the 5% threshold necessary to get into parliament. Had they done so, his party could have squeaked back into government.

A combined 65 deputies is not enough to recreate the previous coalition. But Mr Fico has to find allies too. The obvious, but unlikely, choice for him is the 20 hardline right-wing deputies of the Slovak National Party: its leader, Jan Slota, once said that the country’s Roma “problem” could be solved with a “big whip and a small yard”. On other issues its programme is vague. The one thing it is committed not to do is share power with the Hungarian party; the feeling is mutual.

The other potential partner from the previous opposition is the party of Vladimir Meciar, another populist who, as the country’s authoritarian leader until 1998, presided over a disastrous period of isolation and corruption. Mr Meciar’s party did worse than expected, getting 15 mandates.

Mr Meciar is a shadow of his former self, and his party has evolved a lot from its sinister, thuggish past. His party is, just, a potential partner. But including the nationalist Mr Slota would risk international opprobrium. Liberal-minded outsiders are already worried about the outspoken social conservative government in Poland, and would be quick to condemn Mr Fico for bringing a racist-tinged party into government.

The most likely outcome, therefore, is that at least one party from the outgoing coalition joins Mr Fico in a new one. The Hungarian party has already said it is willing to talk—but insists that the flat tax, among other things, must stay. Weeks of negotiation and bickering may lie ahead, and the new government will certainly be less reformist than the outgoing one. But Slovakia’s many foreign investors are not panicking yet.

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