Mr. Kuchma’s report in Parliament was probably his weakest ever.
The President’s speech did not justify the expense borne by the propaganda machine which for the whole previous month had been preparing the people for something extraordinary and fundamental.
In the spirit of past Soviet decades the anonymous author of his message decided to liven up the officialese. This was only logical, because to continue to refer to some mythical 1994 course would look ridiculous: this “course” has yielded no practical results nor could it. In addition, new terminology would, in this authors’ opinion, at least allow for some self-deception. In a word, they wanted the people to believe that the course adopted in 1994 had results, in fact, that it had been accomplished.
The President started by reminding the audience of the role and meaning of the unifying national idea. A good subject, except that further on he never mentioned it again, so the impression was that the passage was a last minute’s addition, made just as the motorcade was driving up to the Verkhovna Rada building.
Another touching note was its combination of ideas about national sovereignty and priorities in the strategy of reforms. Especially remembering that the much advertised objectives of the “preliminary phase” (liberalization, privatization, monetary stability) were the conditions Ukraine had to face when being admitted to the International Monetary Fund.
The authors of the report are apparently immune to any comprehension of Ukraine’s actual place in the world in general and Europe in particular, as evidenced by what is formulated in the report as an “innovative approach to development.” What innovative approach can there be in a country whose economy is progressively degrading and popular living standards perpetually declining? According to the Ukrainian-European Consulting Center for Legislation, Ukraine’s GDP in 1997 was a mere 31.29% of what it was in 1990; likewise, real industrial output was 42.1%, and take-home wages 34.2%, tending to drop further early this year. If one were to believe Mr. Kuchma’s comprehensive report, Ukraine is now proceeding along the path of underdeveloped countries in terms of industrial output. Thus, in 1990, ferrous metallurgy made up 9.4% of gross industrial output. In 1997, its share rose to 23.3%, that of light industry dropping from 11.2% in 1990 to 1.4% in 1997. This is evidence of its growing share of unprocessed products. Ukraine’s export structure already allows it to be referred to as an underdeveloped country. Thus, visualizing Ukraine as a hi-tech power looks rather strange, even in the presence of its abstract potentialities.
When working on the text, the authors must have long pondered the idea of “enhancing the role of the state” in regulating the economy. The final copy turned out to have plenty of amazing passages about that role. Moreover, considering Ukraine’s pathological dependence on international financial institutions, they acted according to the best Marxist-Leninist literary standard, inserting the World Bank President’s words about the role of the state in modern conditions.
However, all this was in a draft never to be heard in Parliament. Most likely, they reasoned that such literary masterpieces would meet an unwelcome response from the People’s Deputies, primarily due to the “external factor,” so enhancing the role of the state in the economy was left out. Addressing the Verkhovna Rada, the President even stressed that he did not “support reasonable inflation, rather to the contrary.” And went on to say that the hryvnia exchange rate should be adjusted to growing inflation, which left one searching for the logic.
Talking about logic, from Mr. Kuchma’s report follows that some “program-targeted methods of management” will be dug up, perhaps from the socialist planning archives. And budget policy will open up horizons for “tax stimulation of investment and innovation.” The latter could prove fertile ground for all kinds of abuses - say, trading in alcoholic beverages tagged as “innovative investment.” The President spent a long time talking the audience into easing the tax burden, so much so that one found oneself wondering whether perhaps the Chief Executive was primarily trying to convince himself. Given the absence of real state budget receipts, the thesis about government agricultural price supports sounded unconvincing. Legalizing shadow capital remains easier said than done. And calling on representatives of Ukrainian business to participate in running the economy lent the rendition a singularly quaint touch.
The social aspects were frankly weak. Assuming that the main emphasis will be on working people, what will happen to pensioners along with other underpaid and undernourished strata? The stated vehicle of government regulation of wages and salaries remained a vague scheme, especially the part about guaranteed hourly pay. The whole thing sounded like propaganda rather than a realistic program.
Combating unemployment remains yet another motto, considering that even official statistics point to 4% early this quarter. In this context calling for decentralizing social policy sounds like an attempt to shift the burden of responsibility for all failures onto the local and regional levels.
The overall impression is that the Presidential Administration’s economists are busy attending refresher courses, making what they consider outstanding discoveries. But only within their own walls, caring little if anything about what is happening in the rest of Ukraine.
From the purely stylistic standpoint, the President’s report is dominated by two terms: “innovating” and “deepening.” Whereas the former could be considered some sort of axis, the latter has to be studied, possibly by a psychoanalyst. This is true on only a certain level: reforms are “deepening” only in the sense that they are buried even deeper. The report lacks the main issue on the tip of every tongue: the evaluation of all those carrying out reforms: assessment of both sources and causes of the socioeconomic course being followed, and of the individual ranking bureaucrats claiming the role of vanguard of the national economic theory and practice.
The way the report was prepared and delivered is convincing evidence that the intellectual resources of all those concerned are exhausted. Even the fact that its text was previously circulated for “friendly criticism” and the Presidential Administration nervously collected and summarized all of it did not help. The end product was completely disheartening. Regrettably, the authors, despite years spent with the Administration, did not seem to realize that a message delivered by the President of a country located in the heart of Europe should be something far more substantial than a paper on “Malignant Bourgeois Distortions of the Immortal Teaching of Karl Marx,” and that while preparing it one ought to use other tools and methods. What the Ukrainian people heard last Tuesday was written by the powers that be for the powers that be, so they could continue to be confident and comfortable in power.
Probably intended as a serious presidential action, it did not turn out that way. There was nothing epochal about it. The document offered no substantial adjustments to the socioeconomic course, although they could have been made, given proper preparation. The report left one wondering exactly what Mr. Kuchma is going to offer the electorate in the coming campaign.






