Kosor finally opens her parachute

By bringing the government’s focus back to the economy Kosor not only ensured the national economy but also secured her own political fate.

Handle that opens the parachute has finally been activated. After nearly ten months of waiting, Prime Minister comes out with the economic program that could stop the free fall of Croatia's national economy. Instead of improvised announcements in which new measure is introduced each new week, the government presents the public with a comprehensive letter of intent. They clarified their intentions concerning the fiscal and social policies, in controlling liquidity, management of state property, and financial relief of the economy as well as the government. Prime Minister completed a press conference following all the textbook rules, which was something new, compared to her previous PR’s where many of her deliveries were dominated by seemingly casual statements of marginal significance. Considering the measures announced yesterday a lot of things are possibly changing now, but their effect is still lukewarm.

There is no praise or applause. We will see what will happen in a month or two, say careful employers, who have been the most vocal advocates of comprehensive reforms. Government's letter received luke reception among the unions and the ranks of the opposition were almost cold.

Kosor now faces the consequences of ignoring the unwritten rules of politics. All actions that the new government intends to take should be done at the start while public trust and expectations are still high. The current government has already gone in the opposite direction. Professional and political circuits, as well as the general public, are in a certain sense exhausted by the continuation of bad trends and the Government’s passivity. Now that the Prime Minister has finally decided to reveal their intentions and commitment to the public, the content of the measures is actually overshadowed by the public’s disbelief in the ability of its implementation team. Some of the first reactions can be generally phrased as sounding something like - the measures are good, but now we are only missing a capable government who would be able to pursue them...

Prime Minister’s advisers have seemed ‘suspicious’ over the past few months. They rarely disclosed anything in public, and if they did say something, it was usually vague. They seemed careful to reveal as little as possible. They, thus, followed Skegro’s tested method and worked in secret. Timing of the public release was dictated by a political climate. If Kosor continued the debate on Josipovic’s speech in Bosnia and Herzegovina or continued talking about the Veteran’s Registers, her popularity would have reached the lowest possible point.

At the time of rapidly growing unemployment and insolvency, nothing could exasperate the Croatian public more than the unhelpful return to the themes of the past decade. The overall situation was too reminiscent of the year 1999 and they did not need further reminders. By bringing the government’s focus back to the economy, the Prime Minister not only ensured the national economy at the last moment, but she also secured her own political destiny. The paradox of her position is that she will now have to take painful moves if she wants to restore a previous popularity and retain her power.

The paradox of the position parties lies in the fact that they will have to support these unpopular moves, otherwise they will have to do the unpleasant job themselves. Judging by the first reactions from the SDP, they are fully aware this. That means that Kosor will start reforms in a rather clear political situation. Whoever tries to interfere, will be awarded a title of reform-staler. It does not matter if this is Josip  Friscic, who will probably dislike reform’s cessation of agricultural subsidies, or influential media figures who will  oppose the abolition of their tax exemption status.

It is precisely these measures that speak volumes on Prime Minister’s determination. Minister Suker was on this track before, but opposing interests were stronger. And now you can hear opinions on how this is in fact compensation for the abolition of the crisis tax. But what is wrong with that and why would it not be openly acknowledged? What is the logic behind taxing the people with the lowest incomes to favor richer people who can buy homes and invest in insurance? The abolition of tax exemption is seemingly minor measure which, however, requires a lot of courage. The same applies for the compression of the tax burden range, although the highest rate of income tax was hardly ever applied. Almost all of those who have high incomes know how to avoid paying it. Even four tax rates are falsely presented as an expression of social sensitivity.

As for the credibility of the government's proactive role, a lot would have been achieved if they presented not only the draft of the measures, but also plans of implementing the law. At least some of them. Either way, Kosor opened a chance for new opportunity - for reviving the economy and for her own political survival. However, in order for her parachute to fully open, she will have to engage in a fierce fight over the next few weeks and months in an attempt to move Monday’s plans from ‘page to stage’.  Otherwise, her landing will not be soft. In a sense, there is no more time for excuses that rely on the ‘we have tried, but no one agrees with us’ rhetoric