By Serhiy Kirshyn, The Day
Elections to the Verkhovna Rada, allowing the Communists to take a quarter of the seats in Parliament, are eloquent evidence of the economic preferences of the Ukrainian electorate. However, the final historic choice will be made at the end of the presidential campaign in 1999. It would be erroneous to assume, however, that the struggle of ideas and interests with an eye to this campaign is just starting. The fact alone that noted and influential persons are named among the presidential contenders shows that this campaign has a prehistory.
Most political analysts believe one of four candidates have a chance to become the next President: the current Chief Executive Leonid Kuchma, ex-Speaker Oleksandr Moroz, and two ex-Premiers - Yevhen Marchuk and Pavlo Lazarenko. All four have been exposed to enough political temptations and even acquired an individual economic visage. The latter is especially important, because three of the four (Kuchma, Marchuk, and Lazarenko) worked together for quite some time and at first glance nominally were carrying out the same economic policy.
The said course is usually associated with President Kuchma and its beginning coincides with the signing of a memorandum on cooperation with the IMF and World Bank. Therefore, Mr. Kuchma’s economic image was shaped on the crest of a wave of liberalization of fiscal, monetary, and foreign trade policies, along with the struggle against hyperinflation. He is perhaps the only of the four political figures to have proclaimed (but not necessarily implemented) the most daring liberal market ideas - which did not prevent him from making openly anti-market decisions. Another key factor of this course made a noticeably weaker impact on his image: in reality Mr. Kuchma had constantly to steer a middle course between the interests of various Ukrainian industrial groups supporting him and IMF requirements. In practice, such compromise meant constant top level personnel shifts, replacements along with an incoherent and eclectic industrial policy. As a result, in all this period (second half of 1994 to early 1998) the government has not been able to provide conditions for economic growth or for a more independent economic policy.
Over the past several years the Ukrainian people has been constantly reminded of the need to “correct economic reforms” and has never heard a single comprehensible reply to the natural question: What corrections? Every new aggravation of the economic crisis was followed by the Premier’s retirement who was then blamed for all the mistakes that were made. Yevhen Marchuk acted as Premier starting in mid-1995. His replacement in mid-1996 took most by surprise and was at the same time something well to be expected. Awhile later it transpired that Mr. Marchuk had brought forth a number of problems and that the time was simply not ripe to solve them, in that there were no political forces capable of handling them. Among other things, he insisted that any solution to a problem would automatically eliminate its innermost causes, rather than resolve it formally, depending on which political force was then predominant, and leave it at that. In fact, coming up with such acute problems was premature and making sharp declarations about the need to solve them caused an aggravation of the internal political struggle. After all, how could the Premier have possibly changed the course of events if the President did not want to? Yevhen Marchuk’s Premiership vividly demonstrated that there was very little in common between the “export” and “domestic” versions of the so-called presidential course.
Numerous experts noted that Mr. Marchuk’s retirement was not only the result of the President’s political jealousy but also an indication of the problems in the structure of political power in Ukraine. In other words, this post had on more than one occasion been sacrificed to achieve a temporary compromise among major political and economic groupings in Ukraine. It is also true, however, that the Premier’s replacement did not eliminate the main causes of the crisis; it just created prerequisites (still to be implemented) to search for a less politicized strategy to overcome it. The next in line, Pavlo Lazarenko, was given a freer hand than his predecessor, whose options had been limited by the Constitutional Agreement, but he was also led to understand by the Presidential Administration that it would not be up to the Premier to formulate the political and economic course. Instead, he was expected to untie a number of economic knots, primarily back wages and suchlike, and in this context he would be given something akin to the carte blanche. Alas, he did not measure up, either, because he understood a combination of the “targets of the monetary policy and restructuring” in his own way. The Lazarenko government would be remembered by setting up whole “barter empires” receiving staggering revenues as a result of half-way reforms.
Regardless of what Pavlo Lazarenko and his Hromada Party may have declared, he like no one else got the most out of the deformed post-Soviet economy, creating a powerful financial group of supporters. Remarkably, he never demanded laws protecting private business, lowering taxes, or simplifying privatization procedures, because the structures behind him were monopolists with monopolist incomes precisely thanks to these laws.
As a matter of fact, he would have never been appointed Prime Minister with support by the Left and personally by Oleksandr Moroz. It is also true that the economic doctrines of both have much in common (it seems safe to assume that if the ex-Speaker were the head of the government the effect would have been the same). Here the only difference is the degree of resistance to market reforms and the resolution with which Socialist Moroz is striving to restore socialism.
Yevhen Marchuk’s economic views are closer to Kuchma’s than Lazarenko or Moroz. He supports the currently unpopular idea of cooperation with international financial institutions. He says he knows how to combine a transparent economy, protection of the domestic manufacturer, and private land ownership (the latter while banning speculation with the land). Perhaps these ideas in some respects resemble the Presidential NDP’s declarations. However, Mr. Marchuk has one undeniable advantage: he has never said one thing and done another. Besides, no one could ever blame him for the corrupt Ukrainian economy, which is rather important these days.






