Little to cheer about this September 26: First anniversary of 1998 elections a sombre affair for a government racked by disputes

How can victory...
BRATISLAVA, September 26, 1998: Evening falls on the second day of voting in Slovakia's 1998 elections, and several hundred people cram the headquarters of the opposition SDK party. A huge TV monitor hangs over the heads of the politicians and journalists who have gathered to await the latest exit polls. "Quiet! Everybody quiet!" cry hidden voices as the face of a Markíza TV announcer fills the screen.
"The HZDS 22%," reads the announcer, "and the SDK 30%."

illustration: Igor Lyskov

affair for a government racked by disputesHow can victory...

BRATISLAVA, September 26, 1998: Evening falls on the second day of voting in Slovakia's 1998 elections, and several hundred people cram the headquarters of the opposition SDK party. A huge TV monitor hangs over the heads of the politicians and journalists who have gathered to await the latest exit polls. "Quiet! Everybody quiet!" cry hidden voices as the face of a Markíza TV announcer fills the screen.

"The HZDS 22%," reads the announcer, "and the SDK 30%."

Pandemonium sweeps the room. SDK politicians, fists clenched in victory, embrace each other fiercely. For the first time since 1994, victory over Prime Minister Vladimír Mečiar and his HZDS party seems within reach. The wild cheering gives way to a chant - S-D-K! S-D-K! - in which all join, feet stamping the floor. SDK leader Mikuláš Dzurinda releases himself from an embrace with party colleague and campaign manager Ľudovít Černák, and shakes his head in disbelief. "Fantastic, just fantastic," he mutters, his eyes still on the screen.

...Turn to ashes?

Barely one year later, the bloom is off the rose. A poll conducted in late September, 1999 found that almost 50% of people surveyed did not expect the government to survive its entire four-year term in office, while over 81% claimed to have been somewhat or very disappointed with the cabinet so far.

As the poll results were released, however, Prime Minister Dzurinda was pulling off one of the government's greatest foreign policy coups so far - a meeting with US President Bill Clinton, and an address in front of the UN General Assembly, honours that had been denied his predecessor.

How does one explain the contrast between the government's solid foreign policy achievements and its miserable domestic record? How can a government that constantly appears on the verge of falling apart be also on the verge of winning EU acceptance?

It is largely scandal, and a sense that partisan interests still rule decisions involving public money, that has cost Dzurinda the popular support he captured on that September weekend in 1998. The same scandal, and bitter divisions within his SDK party, have also turned the Prime Minister into a lame-duck leader within the cabinet; some government members are now calling for the coalition agreement to be rewritten, while others are demanding cabinet resignations.

In the words of one analyst, the Dzurinda government's first year in power was "a year of missed opportunities" - a year in which early government unity was allowed to turn to confrontation, in which public euphoria melted away to disillusionment, and in which the necessary economic and political reforms were put off until the will to enact them was lost.

Here is how it happened.

Coming to terms

The final results of the 1998 election, which the HZDS actually won with 27% to 26.1% for the SDK, gave the four parties of the opposition 93 out of 150 seats in parliament. The day after polls closed, the SDK, the Hungarian SMK party, the former communist SDĽ party and the SOP of Košice Mayor Rudolf Schuster, announced their intention to form a government. After a month of intense negotiations, Dzurinda emerged in the early hours of October 28 to announce a deal. "At half past three this morning," he said, "a new government was born."

The new government - in which the SDK had nine posts, the SDĽ six, the SMK three and the SOP two - was sworn in during the inaugural session of parliament on October 29. Deputy Prime Minister for EU Integration Pavol Hamžík remarked that "everything is going as we expected. The passions are gone, and the hard work lies ahead."

Primitive politics: "Hej, Slovaci"

As it turned out, the 'hard work' ahead lay more in keeping the peace between governing coalition members than in dealing with the country's domestic and external problems.

The "coalition of coalitions," as the government came to be known, actually united 10 parties from across the political spectrum, whose only real reason for coming together had been to deny Mečiar another four years at the helm. Such a disparate government, analysts reasoned, would need a strong opponent to keep it united.

But with Mečiar's virtual disappearance from politics, and the failure of the opposition parties to participate constructively in the political process, the government found itself in a vacuum.

Bills and programmes were debated largely within the coalition itself rather than with the opposition. Amid such a din of debate, the government was rarely able to speak to voters with a unified voice, and thus rarely able to convince people of the need for austerity measures or for language law reform.

The unity of the would-be coalition was first shaken in early October when the SDĽ declared it would prefer to form a government without the SMK Hungarian party, which SDĽ deputy Robert Fico explained "contains more problems than advantages." Hungarian leader Béla Bugár compared the SDĽ's tactics "to those of [Nazi propaganda chief Jozef] Goebbels," while the Helsinki Civic Assembly in Slovakia called the SDĽ "anti-civic and anti-democratic."

More bad blood was spilt in March, when Agriculture Minister and SDĽ member Pavol Koncoš actually threatened to sue SMK leader Béla Bugár for libel during a dispute over the directorship of the Land Fund (which had been promised to the Hungarians). And on July 10, after parliament had approved an SDĽ-amended Minority Language Law over the objections of the Hungarians, SDĽ deputies rose and joined the opposition in singing the nationalist song 'Hej Slováci,' in apparent provocation of their Hungarian colleagues.

Childish they may have been, but disputes between the SDĽ and the SMK hurt the coalition's image far less than squabbles within the government's largest member, the SDK party.

The unity of the SDK, which had united in 1998 to circumvent an unfair election law, was suspect from the beginning. The joint programme of the party satisfied few of its founding members, who ranged from socialists to free market conservatives, and who were loath to see their political identities subsumed in Dzurinda's SDK.

Less than a month after elections, Justice Minister Ján Čarnogurský and several of his Christian Democatic faction colleagues refused to support the government programme, leading some analysts to predict that the SDK would break up into its five constituent factions before the year was out. "It's getting really tense, but discussing the break-up of the party is still a taboo topic," said the SDK's Jaroslav Volf.

Things continued 'really tense' throughout the year. By March, eight Christian Democrat deputies had left the SDK and re-joined their mother party, while several more left in May in protest at having to support Rudolf Schuster for president. Members of the break-away faction completed their revolt on September 11 by deciding to contest 2002 elections alone without the SDK or any of its member parties.

The Christian Democrats were joined at the barricades by another right-wing SDK faction, the Democratic Party (DS), which took umbrage when Dzurinda blamed DS appointee Ľudovít Kanik for the Nafta Gbely scandal. Fully 18 SDK deputies refused to support Kanik's recall from his post as the head of the FNM privatisation agency, while another eight did not support a government amendment to the Law on Large Scale Privatisation, passed on September 16.

One year after 1998 elections, the SDK barely functions as a party, with member factions regularly refusing to support the line taken by the party leadership. Such defiance has seriously undermined Dzurinda's strength as Prime Minister, and has empowered the more united SDĽ. Virtually the only thing now preventing the break-up of the SDK is the opposition of the other three coalition partners, who worry that coalition agreements signed by the SDK will become void if the party splits up into its constituent elements.

The SDĽ's sham populism

Divided against itself politically, the cabinet has been unable to enact harsh measures to lower the country's fiscal and current account balance deficits, despite the warnings of international groups like the International Monetary Fund (IMF) and domestic economic analysts. Most of the blame for this has been apportioned to the former communist SDĽ, which has used every opportunity to portray itself as the defender of the interests of the common people.

The first casualty of the SDĽ's political posturing was a set of increases in energy prices approved in December 1998. The party managed to have a 100% increase in gas and electricity rates shot down, and replaced by a much more modest hike on December 16. Transport and housing price increases were put off until 1999, while a plan to introduce an import surcharge was scrapped. "These soft measures will help the cabinet maintain social peace, but at what cost?" asked Martin Barto, a senior economist at the SLSP state bank.

The potential cost of delay kept mounting, tthrough another package of soft measures passed on April 14, until a sudden plunge in the value of the crown stung cabinet into action on May 31. The lower VAT rate was raised from 6 to 10%, an income surcharge was installed and electricity, gas and housing prices hiked by 35 to 70%. While business professionals were happy to see the measures, however, they regretted that half the fiscal year had been wasted before cabinet acted, meaning that the measures would have only limited impact on the country's 1999 results.

Other economic laws, such as the recently approved Large Scale Privatisation Law, have also been heavily criticised as leaving the job half done. At fault, again, has been the SDĽ, which has cut the heart out of government bills in order to serve its own populist agenda as 'defender of the people.'

Scandal prone

And then the scandals - Nafta Gbely, Devín Banka, Priemyselná Banka, Deutsche Bank's victory in an advisory tender for the sale of Slovak Telecom, the GSM 1800 tender, the resignation of Telecom Minister Gabriel Palacka. The government managed to make a hash of every high-profile tender it held over 12 months, even after it began to invite corruption watchdog Transparency International Slovakia to oversee proceedings.

This incredible record is not simply one of corruption, although much has been said about how state companies are being used by the government to funnel lucrative contracts to its business friends. Incompetence has also had a large role to play, as has the cabinet's tendency to wash all of its dirty laundry in the press.

Whatever the reason, however, the impact on foreign investors and particularly the Slovak public has been painful. "The Dzurinda government is deader than a doornail if they don't get their act together," said one foreign analyst this spring after Devín Banka's connections with the Finance Ministry first surfaced. "Things like this just make investors want to pack their bags and leave," said another investor during the height of the Nafta Gbely affair in June.

If the Dzurinda government is to survive, it clearly has to eliminate corrupt practices inherited from the past. But as Miroslav Kusý, a political scientist at Comenius University in Bratislava, warned in October 1998, the legacy of the Mečiar era may not be erased overnight. "We have to distinguish between Mečiar and Mečiarism," he said. "The latter is characterised by a primitive style of politics, by populism and disregard for legal structures, and it will last in Slovakia long after Mečiar's departure."

Kusý's warning was prophetic. The government's primitive political style - the public squabbling between cabinet members, and their tendency to communicate with each other through the media - has given the strong impression that the country's leaders do not care a fig for the public interest. The populist tactics of the SDĽ party have watered down almost every significant economic idea the government has had, and have prevented cabinet from explaining to the public why austerity measures are needed. And disregard for legal structures - principally those governing tenders for state contracts of property - has had cabinet ministers in hot water for most of this year.

Vladimír Mečiar may have been defeated in September 1998, but his political legacy continues to torment the country.

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