A New President?

If President Kuchma is serious about slashing government employment by 40% and curbing the power of the feudal landlords running Ukraine’s collective farms, this could be the first step in getting Ukraine off its knees economically, because it could mean downsizing the state to the point where it could cease to strangle the private business activity that alone can create the wealth needed for national economic recovery. And as Canadian Ambassador Derek Fraser and US Ambassador Steven Pifer are making absolutely clear, the West is ready to help financially. Nobody wants Ukraine to remain the new sick man of Europe. Everybody wants it to be stable, prosperous, and capable of at least thinking seriously about taking part in European integration.

Of course, the President did not have much choice. He has been told in no uncertain terms that without such reforms there would be no rescheduling of the country’s backbreaking debts and the country would simply go bankrupt. Finally the West has done the right thing, and we who have been calling for such a policy for years have every right to feel vindicated. But now comes the hard part, making the enunciated moves reality. Everyone understands that bureaucrats threatened with pink slips will cling tenaciously to their posts, and every bureaucrat can justify why his specific function is so necessary. In principle, you can come up with a justification for every single regulation, and the battle of the memoranda will be fierce. The collective farm aristocracy will also do everything in its power to sabotage any changes in a system that suits them just fine. The various corporative interests in Verkhovna Rada will also get into the act.

The President has said some very good things. Does he really intend to do them? Does he have a clear idea how to do so. In any case, Ukraine’s friends in the West would do well to monitor every step taken and not be shy in suggesting just where cuts can be made. Personally, I would start with the sector industries. After all, if enterprises are private and making money, you do not need ministries to manage them. And if enterprises are not, they will have to be shut down as something this country can no longer afford, the sooner the better.