After government officials’ electronic income declarations have been made public, the country is experiencing a shock. Of course, the public was hardly ignorant of our so-called political elite’s cynical nature and wealth they had accumulated over the years, but the latest statement of fact became for many people yet another confirmation of the moral catastrophe of our leadership. Mass media and social networks are literally drowning in comments and analytics on the e-declaration issue.
WHAT ARE THE POSITIVES?
First of all, we should note that it was a positive step. Despite the complicated history of this issue, when the authorities themselves repeatedly tried to block it (which was significant in itself), the decision was still passed. “Through a joint effort of many great people, we first pushed this measure through, and then miraculously saved it,” chairman of the Center for Combating Corruption Vitalii Shabunin posted on Facebook. Let us recall that introduction of e-declaration is a prerequisite for visa-free travel with the EU. The software package for collection, storage, and processing of Ukrainian officials’ electronic declarations was developed with funding from the UNDP and later transferred to the National Agency for Prevention of Corruption (NAPC).
“As someone who was involved in it all from the initial idea to the end product, I will say that everything that was declared today, even if it does not really exist, will be subject to financial monitoring, and not only in Ukraine!” MP Viktor Chumak posted on the social network. “Using it abroad without explanation of sources of income will be impossible. In this country, too, each subsequent transaction will be public. One should not expect to see a massive amount of criminal cases and court sentences, because it is just a starting line today. Still, it offers fantastic material for new disclosures by investigators. And their materials may well lead to new arrests.”
Thousands of officials’ e-declarations (made available at the special website public.nazk.gov.ua) list outrageous details. Let us offer just a few examples. People’s Will MP Oles Dovhy declared 95 paintings of the 19th to 21st century, 10 sculptures, 11 watches, and 1.5 million dollars in cash in his declaration for 2015. Meanwhile, Petro Poroshenko Bloc (PPB) MP Anatolii Matviienko’s properties even include the Dormition of the Mother of God Church in Berlivtsi, Vinnytsia oblast. Minister of Internal Affairs Arsen Avakov declared, apart from three apartments and two plots of land, a collection of fine wines, coins, paintings, stamps, and vinyl records. Another PPB MP Ihor Kononenko’s Kyiv home has floor area of 1,643.6 square meters. This is a record among officials.
President Petro Poroshenko declared stakes in more than 100 companies in Ukraine, Russia, Poland, Spain, Cyprus, Hungary, Lithuania, the PRC, the British Virgin Islands, and the Netherlands, the salary in the amount of 121,054 hryvnias, interest income in the amount of 12,375,404 hryvnias, and investment income in the amount of 49,665,361 hryvnias. The president submitted his declaration just a few hours before the deadline. It may well be that he wanted to let the public vent its anger at previous declarants. Poroshenko’s cash holdings, amounting to 60,000 dollars and 900,000 hryvnias, are stored, just like other abovementioned money assets, in the MIB JSC, where he owns 9,000 shares of nominal value of 13,518,000 hryvnias. His contributions to credit unions and other non-bank financial institutions are assessed at 8,190,000 hryvnias. Poroshenko also has 540,478 hryvnias; 26,324,870 dollars; 14,372 euros in his bank accounts.
Facts which were made public by officials’ e-declarations will long be a matter of public interest, involving lowly clerks as well as the nation’s top official. Many facts and details are startling. “Right now, Ukraine needs urgent help from artists. Preservation of most Ukrainians’ mental health depends on the ability to understand the new reality through cultural means in all their diversity. Remains of moral guidelines are melting under the pressure of a new declared post-genocidal aesthetics. Mountains of cash, stacks of paintings, piles of watches, neighborhoods of apartments, endless fields of land...,” civic activist Serhii Koshman posted on Facebook.
THE ROOTS OF THE ISSUE AT HAND
How could it happen that one of the poorest countries in Europe, whose officials travel the world and beg for money, has these same officials ranking among the richest people in the world? After that, how should Western politicians negotiate with the Ukrainian government’s representatives? “Against this background, the German chancellor or American president look outright losers and beggars when compared to a middling Ukrainian MP,” Hennadii Druzenko posted on the social network. “And this is happening in a country that begs for money worldwide, borrowing wherever possible, having the heaviest debt and the lowest GDP per capita in Europe, a country where poorly dressed soldiers die in combat every day, and volunteers still buy for army food, drugs, thermal imagers, etc., etc., etc.”
THIS PHOTO WON AN AWARD AT THE 2013 PHOTO CONTEST. IT CONTRIBUTED MORE TO ANALYSIS AND PROGNOSIS THAN A GREAT DEAL OF “EXPERTS,” JUST LIKE MANY OTHER ICONIC IMAGES OF DEN/THE DAY. YOU JUST HAVE TO LEARN HOW TO SEE THINGS. YURII LUTSENKO, INITIATOR OF “UKRAINE WITHOUT KUCHMA” CAMPAIGN, HAS NOT ONLY PAVED HIS WAY TO KEY GOVERNMENT POSITIONS IN THESE 15 YEARS, BUT HAS ALSO BECOME ONE OF THE RICHEST PROSECUTORS GENERAL IN THE WORLD / Photo by Natalia KRAVCHUK
“Wealth was not declared for 26 years,” political analyst Serhii Zhydko posted on Facebook. “This does not mean that no legislators or officials had shadow incomes. The foundation was laid by Leonid Kuchma’s inner circle and Kuchma himself. Then everything just multiplied, and several waves of power-holders have stolen their millions and quietly departed, leaving their representatives in the forefront of plundering the country.”
Volodymyr Lanovyi, minister of economy of Ukraine (1992), head of the State Property Fund (1997-98), MP of the 2nd, 5th, and 6th convocations of the Verkhovna Rada: “In order to correctly assess the situation associated with e-declarations, or rather with insanely large fortunes declared by civil servants, we should pay attention to the past of this issue. After all, it did not appear yesterday, and it was preceded by a sequence of events. Of course, the primitive accumulation’s first stage benefited the so-called ‘red directors’ who looted the USSR’s state property. Almost all of them now live abroad. They own villas and palaces. The second wave of accumulation of insanely large fortunes took place in the late 1990s, when the new owners appeared and effectively appropriated by force a large number of enterprises. They were so-called oligarchs. Their businesses were created by privatizing state enterprises, seizing public cash flows and the like.
“In that way, Ukraine became an oligarchy by the late 1990s during the presidency of Leonid Kuchma. Ultimately, it is the oligarchic class that de facto runs the country, its Cabinet, Parliament, and changing presidents. The oligarchs have state officials in their pockets. Anatolii Matios recently said that Viktor Yanukovych and others exiled figures were still sending money here, filling pockets of law-enforcement officers and attempting to stop any efforts to find them and prosecute them for their crimes. The period of oligarchic domination of Ukraine has brought money-filled suitcases to bureaucratic offices.
“Another reason for some officials-turned-MPs having great fortunes is the nature of the latest election, which was, to put it mildly, dishonest, not really open and unfair. There were huge monetary contributions involved and a lot of money was stolen from election funds. I think that a lot of people who are holding seats in the legislature are controlling these flows. Common bribes could not have been enough to accumulate such great fortunes.
“The story of electronic declarations has shown that the MPs want to hold to their seats at any price. They see that there have been no reforms in Ukraine, the nation is in the bottom of rankings on key measures, and they should be ashamed to look in the eye the elderly, the sick, and the war invalids, but they still want to complete their terms. I often hear them saying: ‘We must complete full terms.’ What are you good for, if you are not capable of genuine reforms? They just do not care.”
“Therefore, the confrontation between the government and the public is getting worse. Social protests occur when people feel that social profits are distributed unfairly. Typically, democratic revolutions against the oligarchs, who may even be called feudal lords, stem from the fact that these oligarchs obtain billions and direct them to amplify their capitals instead of raising wages and increasing the standard of living of the people in general.
“In our case, there is an even more shameful situation. Not only the oligarchs, but also corrupt government officials brazenly declare that they have created huge businesses in the short stints spent away from government jobs. No normal business may bring these large fortunes so quickly, because our country lacks necessary conditions for development, investments, and job creation.
“One should not forget either that such disrepute befalling our government is very harmful to the nation’s international standing, because its image influences the trust of investors, creditors and the fate of sanctions against Russia. It seems that our officials just do not realize that Ukraine is at war. One can recall here the MPs voting down pieces of vital legislation while raising their own salaries without any justification.
“So, we have an oligarchic parliament at the moment. Almost all the factions of the Verkhovna Rada have entered it due to huge infusions of oligarchic money. These factions may declare their democratic beliefs and aims, but their surprising votes are actually due to their dependence on their true sponsors. Incidentally, the oligarchic clans themselves are now in a state of major division and crisis. One oligarchic team has fled abroad, the other is now ruling Ukraine. But the oligarchs who have come to power apparently seek accommodation with others so as not to persecute each other. They all want to stay at the top forever, and for this purpose, they work out the principles which their world runs on, and they are far from the realm of national priorities, state objectives and popular needs. They do not direct their huge funds to speed up the development of the country, do not invest in production capacity to enhance the nation’s competitiveness in the international markets, do not care about social standards. Their goal is to maintain their own influence, and to achieve that they finance their puppets, who lobby their interests and provide cover for them in government positions. We must realize that the oligarchs are not really businesspeople or entrepreneurs. Their ways are quite different. One oligarch may have a hundred companies, if not more. How can one owner manage them all? This hinders the development of Ukraine’s economy as a whole, because we have not modernized over the past few decades.”
