It is an open secret that the election campaign is a war of myths. One should not despise the word myth because it is part of society’s culture. There were the myths of Ancient Greece, the Vikings, and Slavs. Ancient as well as modern myths did not come out of nowhere: they were based on people’s real everyday life. But interpreting some phenomena, problems, and standards is a different thing. Here one can see all the culture, range, and level of myth-makers. But while ancient myths are the property of ethnographers, modern myths are a serious political instrument for coming to power. They are based on the real problems that a nation must solve one way or another. The point is that while some ways of solution will cause still more acute problems, others can help remove many obstacles, and still others have only an indirect bearing on what is going on (such myths are especially abundant in Ukrainian politics: suffice it to recall the Red peril and “struggle of reformers against oligarchs”). A genuine revolution might well have occurred in Ukraine’s political myth-making, but will it help solve the problems? For the quality of Ukraine’s prospects depends not least on the quality of the myths offered its people.
Election campaign time in Ukraine has always been something like a time of wonders. An amazed electorate watches suddenly born political colossusi who promise to solve once and for all, in the shortest possible time, the most vital problems that this electorate faces, if, of course, these colossusi find support at the polls.
The coming 2002 elections will, of course, also be no exception. It seems advisable in this context to take stock of the main significant problems in the economic sphere, for these will in fact be the pivot, on which will turn the ideas, slogans and generous promises of major political forces irrespective of their coloring and proximity to or distance from the current authorities. In general, this list is quite short.
1. The level of incomes of those working in the public sector. Although wage arrears have mostly been paid off, the remaining problem is the low level of remuneration among most public sector employees compared to those employed in other productive sectors of the economy. There also are ample reasons to expect a certain drop in budget funding in the fall and winter caused by problems of raising revenues.
2. Wage arrears at non-state enterprises. Considerable arrears remain at enterprises of different organizational forms and sector affiliations. This applies primarily to the remuneration of collective farmers. In contrast to the previous problem, it is impossible to promise to solve this one by simply increasing budget expenditures. With this in view, there can be a wide range of slogans in this area, from opposing the “graft-master managers” to creating favorable conditions for the indebted enterprises to get back into the black.
3. Pension provision. The gradual increase in and prompt payment of pensions has somewhat defused the issue but still failed to fully make up for the actual reduction of pensions as a result of last year’s inflation. The size of a pension is still well below the subsistence level. This will make raising pensions a very pressing issue.
4. The return of public savings that disappeared in the USSR Saving Bank. This problem remains acute because of the great value of the funds lost. What has been recently done to compensate for the losses and restructure these arrears cannot entirely solve the problem. Moreover, seeing that debt restructuring turns thousands of erstwhile rubles into miserable kopecks, the hapless depositors only become more embittered.
5. Compensating for the loss of public deposits in the Ukrayina Bank is a similar problem. This fresh problem is perhaps going to be far thornier because the number of this bank’s depositors is quite large, especially in the countryside. In practice, liquidating the bank and paying compensation for the lost deposits is not such a simple thing and could trigger still greater discontent among the unfortunate depositors. In addition, returning deposits worth over 500 hryvnias will be dragged out.
6. The overall performance of the public sector. The payment of wage arrears has been welcomed by the part of the electorate directly employed in the public sector. Yet, the social sphere as a whole remains inadequately funded. Education, culture, health care, and law enforcement, especially in the provinces, are still in a quandary, which has a negative effect on the social climate as a whole. What in no way contributes to the warming of this climate is also the privileged allocation of funds to official and fiscal structures. Thus, the determination to streamline expenditures, especially on the local level, to ensure an equitable distribution of budgetary funds, and cut short likely embezzlement is likely to enjoy considerable popularity.
7. Public utilities. As a result of changes in the subsidy granting pattern made during the consideration of last year’s budget, a number of social groups lost subsidies they in fact needed. What further worsened the social climate was the cancellation of privileges for some population categories. Still acute remains the problem of excessive public utilities charges and the glaringly low quality of these services. Moreover, even the usually docile villagers are no longer inclined to suffer from the continuous breakdowns of the outdated water and electricity infrastructures. Moreover, new electricity, gas, and water outages in residences and social facilities, quite possible as a result of the recent privatization of six regional electricity authorities, will also become a major factor exacerbating the situation. What will also contribute to this are the attempts to solve the utilities nonpayment problem through force, i.e., by the individual disconnection of utilities and confiscation of personal property.
While these problems relate to the overwhelming majority of the Ukrainian electorate and could be exploited by all political forces and, let us be blunt, are sure to become the object of the greatest pie-in-the-sky promises, there also is a number of mass problems that require more sophisticated and constructive solutions. Let us single out the following among them.
1. Public employment. Obtaining a paid job still remains one of the leading motives for a sizable portion of Ukraine’s socially active individuals. This is why plans to restore or expand local production facilities that are visibly increasing their output throughout Ukraine, granting the opportunity of temporary employment or conversion training, etc., seem to be winning mass interest and approval.
2. The problems of regional development are closely tied up with the previous ones. The recent activity of regional elites allows us to forecast more attention to regional problems. This particularly refers to center-periphery relationships, exploitation of the status of a so-called donor region, and rivalry between the regions (for example, banning the processing of farming raw materials at other regions’ enterprises in order to load one’s own enterprises). In addition, depending on the specialization and geographic position of a region, some all-Ukrainian problems can also appear pressing, such as emphasizing the East and West vectors in foreign policy with the aim to develop cross-border cooperation of western and eastern regions, encouraging and protecting the industries that promote urban development, or are leading in the region, etc. It is noteworthy that all these ideas effectively combine (as far as the campaign is concerned) the interests of the public at large and those of regional elites.
3. The debt crisis of enterprises. Although this problem seems an elite one and one that should worry primarily the managerial corps, the debt crisis still has a social coloring. First, the debt problem can be directly linked with wage and salary arrears. Secondly, converting the debt into material liability and withdrawing the property of enterprises and some specific parts of the economic complex deals a staggering blow to the employees of these enterprises. Clear proof of this is the recent conflict over the confiscation of farm machinery as debt payment in Vinnytsia oblast, which was highlighted in the central press. As material liability will be invoked more and more, it could lay quite solid groundwork for political agitation.
There are also a number of other problems faced primarily by the economically active population which, owing to shuttle trading and other small-scale commerce, is large enough today to be the object of the minute attention of election campaign organizers. Here are some of these problems:
1. Deregulation of entrepreneurship. The issue is to simplify the procedure of launching one’s own business and current accountancy, to protect small business (whether a corporate entity or natural person), as well as to ease the tax and duty burden on entrepreneurs. A serious battle is likely to be fought over the preservation of simplified tax and unitary tax on the subjects of entrepreneurial activities. The latter is not envisaged in the official draft Tax Code, which jeopardizes the business of a large number of small- scale traders.
2. Macroeconomic stability. Slogans about the hryvnia’s stability, curbing inflation, and budget consolidation will be used by political forces oriented toward the economically-active population, primarily entrepreneurs, although it is doubtful they will succeed. On the other hand, such bogeys as inflation and devaluation, which will eat up the real incomes, will also be intended for the grassroots.
No doubt, the rank-and-file voter will come under a shower of narrower special details, such as interest rate dynamics, money aggregates, stock market development, investment and industrial policies, etc., which the experienced expert will regard as a true indicator of the level of pie-in-the-sky or the actual background of the proposed solutions and which will be intended to make an impression on the masses. But, by all accounts, these slogans will have no substantial effect on election campaigning.
I think that, no matter how the elections come out, their most constructive effect will be in triggering a massive brainstorming about Ukraine’s real problems by the best domestic and foreign intellectual forces. In this way society will have to undergo a test of its ability to distinguish between myths, pie-in-the-sky, and realistic ways to solve its current and future problems. For, as we all know, a properly defined problem is one already halfway to being solved.
