For almost a month, Romania has had an interim prime minister and government with limited powers. It will not be able to submit a fiscal plan adopted to reduce the budget deficit to 7% to Brussels on June 4, a reform without which the European funds risk being blocked.
It is possible that a small extension has been obtained from the European Commission, until the end of June, for the adoption of the plan through emergency ordinance, as there is no other viable solution, by a government with full powers.
In order to at least fit into this extension, this week we should have at least the name of the prime minister, and the formation of the government should be on the right track.
The Inevitable Fiscal Reform
As Kelemen Hunor has already pointed out, somewhere around 30 billion lei need to be found, and the reduction cannot come solely from cuts, which only produce effects at least several months later, or solely from tax increases.
The government needs additional funds immediately, and as Minister Boloș suggests, even the European Commission is no longer willing to believe the same old story, repeated too many times, about expense reductions and improved collection. Not because they are unnecessary, but because they have never happened.
So, the increase in VAT is not really a matter of if at this point, but only a matter of how much? How many percentage points? And/or an increase in income tax. Tax increases are looming, in any case, as inevitable.
Moreover, let's not forget that it's not just about this year when we need to reduce the deficit from over 9% to 7% in 2024. After that, in seven years, we need to go below 3%.
Beyond the hesitations of the past week, the concrete details of the fiscal decision can only be credibly established with the prime minister at the helm, because he is the one who must implement them, and he is the one who pays the political price first and foremost.
So, the elephant in the room is the name of the prime minister. That's the issue, and that's where the government program will start from.
The Complicated Equation of the Prime Minister
There is one politically credible name, from a distance, for the citizens: Ilie Bolojan. But the largest party, essential for governance, is PSD. However, the very existence of the government depends on it, and normally it could rightfully claim the position.
PSD is not particularly keen on it, it does not have a name for it, it is not in the mood for the political cost either. But it cannot give it away for free. So, it demands compensations. And there is a large dowry on the table, from the leadership of the SRI, which the president only proposes, the majority decides in Parliament, the leadership of the Chamber of Deputies, the Senate, if Mr. Bolojan becomes prime minister, two positions in the Constitutional Court, key ministries, leadership of public radio and TV, the People's Advocate, etc.
Sorin Grindeanu must present a substantial price to the party in order to justify the largest party in the current parliamentary configuration relinquishing the position of prime minister, one that ensures the essential concerns of the Social Democrats in the territories: money and tranquility.
Ilie Bolojan is willing to be the prime minister during the most challenging period in Romania's history, but if you are sending him on this extreme mission, you must provide him with the necessary equipment. The Moor does his duty and may die, ultimately, as the political savior Leszek Balcerowicz did in Poland, but at least he should be able to do his duty.
And for that, the key elements are authority and solidarity.
Ilie Bolojan needs the guarantee of real authority over the team of ministers and state secretaries that he can dismiss without seeking permission from any leader or coalition if they fail to carry out the tasks outlined in the government program. This program is his main evaluation tool for the ministers, and for that reason alone, it cannot be created in his absence.
Is PSD willing to grant him such power? Therefore, the party leadership has also tested the option of a technocrat prime minister, and the rotation, hoping somehow that they will let Bolojan take the tough measures now and they will come in the second part to share before the elections.
And, of course, there is another key question. Can Ilie Bolojan trust PSD, in their solidarity during tough times, even if he secures a comprehensive agreement within the coalition?
On one hand, PSD only has a provisional leadership until the congress in August. Sorin Grindeanu will sign now, but that doesn't mean that the future president will agree with the understanding and that a new leadership formula will not try to reshape it under the pressure of toppling the government.
On the other hand, future measures will certainly generate social tensions. For example, there is already talk about increasing the teaching workload. There will surely be protests, perhaps even on a large scale. Where will PSD, a governing party without a prime minister, stand? Alongside the prime minister or, primarily, with the protests, possibly with banners in hand and vuvuzelas in mouth?
These are the sensitive questions around which discussions are revolving in these days. Of course, it would be ideal to have a government program agreed upon to the smallest details, as it happens in other countries, but time is not patient. Moreover, as I have mentioned, I cannot recall a signature on a mutually agreed document preventing the breach of the agreement in Romania.
Ironically, the only political figure who has respected what he signed was Ilie Bolojan, regarding his candidacy for the presidential elections, and he was harshly criticized for it.
It would be serious, therefore, for another week to pass with all sorts of commissions and hesitations, without appointing a prime minister.