europe view on mediocrity

Europe.view

Inconvenient truths
Apr 16th 2009
From Economist.com


Why mediocrity flourishes and will only thrive further
POLITICAL freedom means that rulers tremble when voters grumble. Fine. But a healthy political system also needs an opposition that is able and willing to take power.

On that score, the outlook in post-communist countries looks rather bleak. Few have what sport journalists call a “long bench”—meaning a plentiful supply of substitutes who can take the field when the first lot of players are injured, exhausted or overwhelmed.

Hungary’s ex-communist rulers, for example, were dire, and a caretaker prime minister, Gordon Banjai (pictured below, foreground) has now taken over. But it requires quite a leap of faith to think that the likely winners in next year's election, the right-of-centre politicians of Fidesz, led by the volatile and idiosyncratic Viktor Orban, will be much better.


The same goes for the Czech Republic, where what should have been six months of glory running the EU has turned into a farce that disgraces everyone. In Latvia, almost all competent politicians (and some incompetent ones) are deployed on the pitch already. If the economic collapse overwhelms them, who will take their place?

Even countries with talented individual personalities in public life cannot necessarily say that they have a strong, credible opposition. Latvia has excellent journalists, NGO-niks and civil servants—but none of them are warmed up and ready to play on the political field. And individuals, even fit and ambitious ones, don’t make a team. Georgia’s opposition leaders are seasoned and eloquent. They have all, for reasons good and bad, quarrelled with the headstrong president Mikheil Saakashvili and want him to step down. But little else unites them.



So far, political systems across the post-communist world have done a poor job of ventilating pressing political issues, such as sharing the pain of the economic downturn. What will happen to firms and households in, say, Hungary or Romania, who have borrowed in euros and Swiss francs, and now cannot repay their loans? Should governments force foreign banks to reschedule the debts? Will taxpayers help? Or will the market and the legal system be left to take their course? If responsible politicians don’t discuss this, then irresponsible ones will.

Public figures in or close to politics who could credibly run the country are easy to spot in the biggest and the smallest of the new EU member states. Some of them, such as Leszek Balcerowicz or Mart Laar (ex-Polish finance minister and former Estonian prime minister respectively) even have international reputations. They may be the most conspicuous figures, but other impressive potential players are lurking near the substitutes’ bench, their kit already packed in their sports bags. Poland has heavyweight regional politicians, such as the mayor of Wroclaw, Rafal Dutkiewicz; Estonia has a crop of top-quality serving and former public officials, the fruit of the modernisation of public administration in the 1990s.

But for the most part, in most countries, the ebb and flow of sleaze, cynicism and apathy over the past ten years has washed talent out of the political system, while mediocrity has flourished.

Now the downturn makes the political game look even less attractive: bruising economic misery may be a fine spectacle, but it is not particularly tempting for participants. It is a good time to have a sinecure in academia, in a think-tank, or (best) in an international bureaucracy. But taking office means taking responsibility, at a time when even the most inspired political leadership may not bring much in the way of results. Fancy explaining to bewildered and resentful voters that their savings, jobs and hopes for the future are imperilled and that nothing much can be done about it? Please form an orderly queue.

Europe View #106

Cleaning up the act

Nov 20th 2008


The EU’s watchdogs stand in need of better watching

The European Union’s thinking about corruption goes roughly like this. It is a problem for governments, chiefly in the new member states. The best way to fight it is by making entry into the EU conditional on progress. That will create the political will which must, sooner or later, bring results.

That approach is not working. Anti-corruption efforts have stalled or reversed. Countries such as the Slovenia, Romania, Latvia and the Czech Republic have closed down or weakened their anti-corruption offices. Efforts by the two newest members, Romania and Bulgaria, are ineffective. Croatia, though gripped by a ghastly outbreak of gangland violence, is moving swiftly towards the EU.


The real story is that the prospect of EU membership encourages elites to pay lip service to the anti-corruption cause, but no more than that. Once the conditionality is gone, the pressure stops.

Efforts to train officials and create the right sort of structures in ex-communist countries seem to have little or no effect. In a phrase familiar from western development efforts in non-European countries, “the solution is the problem”: in other words, the agencies and officials being entrusted with the means to fight corruption are just as bad (weak, corrupt or incompetent) as the people that they are supposed to be policing.

Those who do try to change things risk being fired, not promoted. Corruption-fighters such as Romania’s Daniel Morar or Slovenia’s Drago Kos are relying increasingly on support from outside to hang on to their jobs.

Awareness campaigns are not the answer: the public is already highly aware of the level of corruption, having first-hand experience of it. Such campaigns stoke a sense of futility: Eurobarometer opinion surveys show that easterners are increasingly disillusioned with the ethical standards of their elected representatives and public servants; west Europeans are morose about the same public officials as well as the impact of corruption on the EU as a whole.

These gloomy ideas—as they came to light in a “lessons learned” workshop at the recent International Anti-corruption Conference in Athens—should give EU decision-makers cause for serious thought. One of the organisers, Alina Mungiu-Pippidi, of Berlin’s Hertie School, argues that in some new and future member states corruption is not seen as “a mostly individual infringement of a norm of government fairness and impartiality” but as the opposite: the normal way of distributing public services; to friends, allies, clients and bosses. Using judicial punishments against something that is largely regarded as normal behaviour (at least among the perpetrators) is unlikely to work. Nor are outside watchdogs such as OLAF, the EU’s in-house fraud-busting outfit, likely to get to grips with the problem, given their assumptions of “perfect functioning of the rule of law and of impartial bureaucracy”.

One answer is to set up a much better means of measuring anti-corruption efforts. The existing benchmarks focus on the creation of formal institutions, not on their impact. They also create an unhelpful mixture of smugness in some countries (“What us, corrupt? No way—try next door!”) and paranoia in others (“Why pick on us? What about them? And you?”). It would be good if new yardsticks included all the EU members, not just the new and future ones.

Perhaps the EU needs a commissioner for anti-corruption, or a special envoy, to be directly responsible for following up on commitments made during the enlargement process.

But the best approach is to use the expertise that can be found outside government, particularly in the voluntary sector. The enemy of corruption is public-spiritedness; the stronger that gets, the greater the chances of both constraint and redress. It is as simple—and as complicated—as that.

Europe View no 93: more on Morar

Europe.view

Corruption for and against
Aug 7th 2008
From Economist.com


Why Daniel Morar deserves the West’s support

CORRUPTION in Romania is a hot topic as the government decides whether to renew the mandate of the prosecutor-general, Daniel Morar. His supporters see him as a valiant scourge of high-level corruption; his opponents think he is an incompetent stooge pursuing political vendettas. These are the five common—but flawed—arguments against him.

First: the West is no better and its criticisms are hypocritical. Certainly since the collapse of communism the ethical underpinnings of the western system have steadily crumbled. The Europe of Gerhard Schröder and Silvio Berlusconi has little authority to condemn anybody.

But the worst features of old Europe should hardly be a model for anyone. Italy’s economy is in a terrible mess; Germany has been nobbled by Russia. And Romania, as a much poorer country, cannot afford bad government. It has a once-in-a-lifetime chance to catch up the lost decades of communist rule and that depends largely on billions of euros from the taxpayers of the richer part of the continent. Corruption endangers that.

The second argument is that Mr Morar has made no difference. Corruption is just as bad as it always was. Again, there is a grain of truth in that. Bribery in schools, clinics and the like is endemic. But to be fair, dealing with that is not Mr Morar’s job: his prosecutors are supposed to go after high-level corruption, not day-to-day sleaze. His lack of results is notable, but hardly his fault: courts hand down derisorily lenient sentences and parliament preserves the immunity of his top targets. Even if Mr Morar is just scratching the surface of the problem and if some or even many of his prosecutors are incompetent, it is hard to argue that things would be better if nothing was happening at all.

Third: the real story is a battle of political clans, one of which is using the “anti-corruption issue” to attack the other. This has a large element of truth, in that the political grouping headed by President Traian Basescu has indeed used the corruption issue to bash its opponents.

And the president’s deplorable way with advisers, plus unexplained parts of his communist-era personal history, when he had a plum job abroad, certainly give his critics some serious ammunition. But that does not mean that anti-corruption fight is a sham. Politics in a free society often involves parties pushing good causes for opportunistic reasons. At the very least the past couple of years have seen an end to the climate of impunity that long characterised Romanian politics.

Fourth: the corruption issue is exaggerated. Most Romanians don’t pay bribes and the non-corrupt bit of the economy is what matters. Certainly growth has boomed and foreign investment has been flooding in. Yet those same foreign investors lament the damage corruption does. In particular, corruption in the education system devalues the “currency” issued by schools and universities—they will eventually become meaningless. And it is hard, if not impossible, for public administration to produce a modern infrastructure in a system plagued by corruption. Without that, growth will be throttled.

Five: this isn’t about morals. Corruption is just a symptom of bad government. True. It would be insane to start an anti-corruption drive by locking up all the doctors and teachers who take under-the-desk payments. But that is no excuse for leaving things as they are. Better salaries in the public sector are a necessary condition for ending corruption. So is more transparency. But it is also essential to punish flagrant wrongdoers, particularly at the top. Without that, no anti-corruption drive will have any credibility.

Daniel Morar

Romania

Mr Too Clean?

Jul 31st 2008 | BUCHAREST
From The Economist print edition

An anti-corruption crusader faces the sack

FIGHTING corruption in a country that tolerates it is a lonely job, and Daniel Morar may not have his for much longer. Intensely disliked by most of Romania’s politicians and vilified in the media, he reaches the end of his term as head of the Romania’s anti-corruption agency on August 12th. A government announcement on his future—and likely replacement—is expected imminently.

If so, Romania’s hottest political issue will become an international one. A European Commission report on July 23rd criticised Romania’s lacklustre effort against wrongdoing, but did not impose sanctions as it did against Bulgaria. It praised Mr Morar’s agency, and a spokesman says his status is a “test case” of Romania’s readiness to curb high-level corruption after joining the EU in 2007.

The Romanian parliament, however, does not share this admiration. It uses its veto to prevent Mr Morar’s hottest cases from going to court. And of the 109 cases that were prosecuted in 2007, only 25 resulted in prison sentences, mostly for the minimum three years, or (with mitigating circumstances) even less.

Critics say that Mr Morar is pursuing political vendettas on behalf of his backers, chiefly Romania’s president, Traian Basescu, whose supporters are the main opposition Democratic Party in parliament. Mr Morar’s agency has indeed chiefly gone after politicians from other parties; but it has prosecuted some important figures in Mr Basescu’s camp too.

Mr Morar’s difficulties are a symptom of something else: a culture in which corruption does not equate with disgrace. Transparency International ranks Romania as the most corrupt EU country. Bribery is endemic, typically to secure medical treatment or teachers’ favours.

At an off-the-record seminar organised by a German think-tank recently, judges said punishing corruption severely would be hypocritical and harsh. The Romanian language has no precise word for “accountability”.

Bulgaria/Romania corruption

Bulgaria, Romania and the EU

Balkan blushes
Jul 24th 2008 | SOFIA
From The Economist print edition


The European Union softens its criticisms of Bulgaria and Romania

BY THE polite standards of Brussels, it was quite tough. On July 23rd the European Commission issued critical reports on Bulgaria’s and Romania’s progress (or lack of it) in fighting corruption and spending European Union money. Yet after intense lobbying, the language was weaker than in the scalding drafts leaked earlier. And the commission dropped an explicit warning that Bulgaria was endangering its chances of joining the euro and the Schengen passport-free travel area.

Even so, the reports hit home, complaining of a “striking” absence of convincing results in Bulgaria’s anti-corruption fight, and of a “grave problem” over the “lack of accountability and transparency in public procurement” when spending EU funds. The commission announced severe sanctions, suspending aid worth as much as €486m ($770m). Without reform, the suspended sum will rise sharply by November.

Bulgaria’s prime minister, Sergei Stanishev, welcomed the softened language of his country’s report and promised an “action plan”. Outsiders treat all promises of improvement, along with such flourishes as the appointment of a well-regarded ex-ambassador, Meglena Plugchieva, to oversee the use of EU funds, with justified scepticism. Despite much shuffling of departments and expensively publicised initiatives, and what on paper look like the right laws and procedures, the glaring fact remains that Bulgaria’s efforts have shown almost no results in terms of convicting fraudsters or corrupt officials.

Indeed, public figures sometimes seem not just weak but malevolent. For example, the EU’s anti-fraud agency, OLAF, has accused high-ranking officials of being a “political umbrella” for gangs who have stolen millions of euros meant for Bulgaria’s backward and dirt-poor countryside. “Influential forces” in politics and the bureaucracy, suggested OLAF’s leaked letter, are “not interested” in punishing those linked to two notorious crime bosses.

Worries about Bulgaria and Romania, especially over their ability to administer nearly €38 billion promised by the EU up to 2013, are hardly new. In January it emerged that the man in charge of Bulgaria’s roads, Veselin Georgiev, had granted contracts worth hundreds of millions of euros to a company owned by his brother. The commission froze €144m for farming and road improvements, and Mr Georgiev resigned. So did the interior minister, Rumen Petkov, after reports that a drug gang had obtained secret internal documents from his ministry, and that illegal booze producers had traded money for favours from a senior crime-fighter. Mr Petkov is in charge of fund-raising for the Socialist (ex-communist) party, which heads the governing coalition and also won the presidential election in 2006.

Crime, corruption and a weak judicial system are overlapping problems. Not one of dozens of gangland killings since 2001 has been solved. The kidnapping of the president of a leading football club and, later, his wife within the past two months has highlighted the authorities’ seeming helplessness over organised crime.

What scandalises ordinary Bulgarians is that their country, the poorest in the EU, is missing a vital chance to modernise. Public services are dire—shown by a crisis this month in Sofia’s rubbish collection, which has left the streets piled with rotting piles of garbage. So foreign criticism, which in some countries might arouse defensiveness, is in fact welcomed. The EU’s popularity has rocketed, whereas the government’s negative rating is now as high as 73%. The country has lost, by some estimates, a quarter of its population since the early 1990s, shrinking from 10.5m then to as low as 7.5m now. That is a huge vote of no confidence by the public.

Parliament is another story. The government looks set to survive a no-confidence vote next week. A general election is due next summer, when a new centre-right party, headed by the mayor of Sofia, Boyko Borisov, is expected to do well. He attracts praise for his dynamism, though fastidious Bulgarians flinch at his background as an ex-wrestler, bodyguard and police chief: emblematic in their eyes of the political milieu that the country needs to dump.

In Romania, by contrast, politicians are relieved after escaping sanctions in a softly worded commission report on their anti-corruption and legal reform efforts. This too was watered down from the draft, itself weaker than some seasoned Romania-watchers had hoped. The commission bemoaned the lack of practical results but welcomed a “move in the right direction”. In Bulgaria, sadly, outsiders find it hard to see any movement at all.

If you wanted to discredit the EU, squandering taxpayers’ money in its most corrupt new members, Romania and Bulgaria, would be one way to go about it. Yet though Brussels is disappointed and even angry about the two countries’ performance since joining the club in January 2007, Eurocrats are not sure what to do. Sharp criticism and tough sanctions might merely demoralise those who are trying to make things better, as well as undermining the membership hopes of other Balkan countries. Despite everything, few believe that any of the new members would be better off out than in.

Romania corruption scoop

This was largely the work of the excellent Economist stringer in Romania, Valentina Pop


Corruption in Romania

In denial

Jul 3rd 2008 | BRUSSELS AND BUCHAREST
From The Economist print edition

The European Union conceals Romania’s backsliding on corruption

HOW bad is corruption in Romania? Somebody well-placed to answer is Willem de Pauw, a Belgian prosecutor who is a veteran European Union adviser on the matter. Last November he wrote a report that concludes: “instead of progress in the fight against high-level corruption, Romania is regressing on all fronts…if the Romanian anti-corruption effort keeps evaporating at the present pace, in an estimated six months’ time Romania will be back where it was in 2003.”

This report has not been published (it is now available here). The European Commission’s report in February was a lot softer. “In its first year…Romania has continued to make efforts to remedy weaknesses that would otherwise prevent an effective application of EU laws, policies and programmes. However, in key areas such as the fight against high-level corruption, convincing results have not yet been demonstrated.”

That falls far short of admitting that Romania’s authorities are wilfully failing to co-operate. Some of Mr de Pauw’s most striking examples did not appear in the official report either, or were buried in footnotes. Mr de Pauw confirms his authorship but refers inquiries about it to the commission. Officials say he was consulted on the issue. Their February report, they add, was a “factual update”, not an assessment of Romania’s progress. That will come in a fuller report later this month.

It would be encouraging if this included some of Mr de Pauw’s points. One hot example is the cases that courts have sent back to prosecutors since Romania’s constitutional court struck down an anti-sleaze law. Mr de Pauw’s report said that “basically all” high-level corruption trials had been rebuffed by courts, which it was “statistically impossible to attribute [to] the coincidental occurrence of procedural mistakes in individual cases. Other factors than legal-procedural considerations have clearly played a major role.” He added that “the Romanian judiciary and/or legal system appears…unable to function properly when it comes to applying the rule of law against high-level corruption. Indeed, more than five years after the start of Romania’s anti-corruption drive, the public is still waiting for one single case of high-level corruption to reach a verdict.”

Events also support Mr de Pauw’s warning that Romania could soon regress to the level of 2003. Take the case of Adrian Nastase, a former prime minister charged with several counts of corruption and bribery. He has now been exonerated by the parliamentary committee on legal affairs. A lobby group, the Initiative for a Clean Justice, complains that “we are witnessing the transformation of parliamentarians into judges and of the judicial committee into an extraordinary court.” A full parliamentary vote on the committee’s recommendation has been postponed until after the EU’s July report. But Mr Nastase and his supporters are already considering a presidential bid in 2009.

In retrospect, the EU relied too much on individual politicians to back Romania’s anti-corruption drive, notably Monica Macovei, a much-admired justice minister. She was fired soon after Romania joined the EU in January 2007. Membership made the political elites feel they were off the hook. Mr de Pauw offers a bleak verdict. “Many of the measures that were presented, before accession, to be instrumental in the fight against corruption, have been deliberately blunted by parliament or the government immediately after accession…all major pending trials concerning high-level corruption, started just before accession and only after many years of hesitation, have now been aborted and are, most probably, definitely abandoned for all practical purposes.” He also cites the weakening of the role of the National Integrity Agency, meant to limit politicians’ conflicts of interests and verify their assets, and also amendments to the penal code before parliament that will “fatally affect” the investigation of corruption.

All this, he says, shows “the intense resistance of practically the whole political class of Romania against the anti-corruption effort”. Mid-level Eurocrats, as well as some foreign diplomats in Bucharest, agree. The problem is that countries such as France pushed to get Romania into the EU early for their own reasons, whether financial or geopolitical. And the political pressure may now be to cover up, not expose, the problem. If the EU’s July report on Romania is as anodyne as the previous one, suspicions will only grow.

Corruption

This with many thanks to my excellent colleagues in Bulgaria, the Czech Republic Poland, Romania, Slovakia, who contributed screeds of excellent material that sadly could not be squeezed in to the story


Corruption in eastern Europe

Talking of virtue, counting the spoons
May 22nd 2008 | BRATISLAVA, BUCHAREST, SOFIA AND WARSAW
From The Economist print edition


Now that they're in the club, new European Union members are failing to deliver on the promises they made to fight corruption

FOR corrupt officials in central and eastern Europe, life has seldom been better. Joining the European Union has produced temptingly large puddles of public money to steal. And the region's anti-corruption outfits are proving toothless, sidelined or simply embattled.

The biggest problems are in Romania and Bulgaria, the EU's two newest members, whose apparent inability (or disinclination) to deal with high-level corruption has led to increasingly acerbic public warnings from Brussels. But other countries have done badly too. “Before accession, governments were under close scrutiny. Now the fight against corruption is not a priority,” comments Drago Kos, president of GRECO, an anti-corruption outfit affiliated to the Council of Europe, a human-rights organisation. “The Europeanisation of political elites was largely taken for granted,” says Alina Mungiu-Pippidi, a Berlin-based Romanian academic.

Even in Slovenia—once seen as a paragon of good government—lawmakers are trying to close down the commission for the prevention of corruption, run by Mr Kos, arguing that it is expensive and unnecessary. The real reasons may be disdain for all public watchdogs (where staff salaries have been cut by a third) and the commission's repeated attacks on the government's anti-corruption credentials. The mooted shutdown has attracted outside protests, including one from the OECD, a Paris-based club of rich countries.

In Latvia, the head of the anti-corruption agency, which had been investigating the financing of the former governing party, narrowly fended off a bid to unseat him. In Slovakia, the justice minister called the special anti-corruption court, which has highly paid, security-vetted judges, a “fascist institution”. His party, a junior member of the ruling coalition, is trying to have it deemed unconstitutional. Another minister wants bribing foreigners to become a legitimate part of public spending.

But the most spectacular cases are still in the Balkans. Barely three months after it joined the EU in 2007, the Romanian government fired Monica Macovei, a doughty justice minister who had attacked corruption head-on. Her successor tried to fire the anti-corruption prosecutor for investigating his political sponsors. The incumbent is a former lawyer for Russia's Gazprom. Procedural snags have held up all high-level corruption cases. Investigation of former ministers now requires parliamentary approval, sending every case back to square one. Although Romania comes out lowest in the EU in the rankings by Transparency International, a lobby group, the government seems determined to attack its critics rather than corruption.

Bulgaria, similarly, prefers talk to action. Multiple new anti-corruption agencies are poorly co-ordinated or have never got going. No case of high-level official corruption has led to a successful conviction, just as not one of more than 120 gangland shootings since 2001 has been cleared up. EU officials (and most Bulgarians) believe that organised crime reaches the highest levels of government. The forced resignation of the interior minister, Rumen Petkov, in April, has made little difference. Brussels is considering cutting billions of euros in aid and withdrawing recognition of Bulgarian court decisions.

Gimmicky special agencies cannot make up for a justice system filled with crooked, timid or inexperienced judges and prosecutors. Indeed, in badly run countries, a powerful anti-corruption agency can aggravate the problem: special powers and privileges can be abused for venal reasons or to settle political scores. This happened in Poland, where the zealous sleaze-hunters of the Law and Justice Party squandered their election win in 2005. Although most Poles seem to believe that wealth is a sign of past lawbreaking, they disliked even more the heavy-handed, selective and publicity-hungry doings of the new anti-corruption agency. The new government downgraded it, and is trying instead to cut back the bureaucracy.

That may be a more promising approach. Corruption crackdowns work only if the public administration is simplified to the point where bribe-taking becomes either unnecessary or highly conspicuous. That has been the secret of success in Estonia, probably the cleanest country in the region. But most east European countries have yet to reform their bureaucracies, creating lots of opportunities for peddlers of lucrative short cuts.

As its economic competitiveness erodes, eastern Europe can ill afford bad government. Voters are generally disillusioned with post-communist politics. Yet from the Baltic to the Balkans, even politicians facing the most startling accusations of corruption seem not to suffer at the polls. A bit like Italy, really.