Moldova: An Old Hot Potato in European Security

Moldovan elections have once more put the country on our mental maps - for a moment. The country deserves to stay there for a while longer. There is indeed reason to fear that Mr. Putin will now help put it higher on Europe's security agenda, as Judy Dempsey suggested today in the Moscow Times (December 4, 2014). In other words, as we shall see, the election results of November 30 reflect more than a passing cleavage between East and West.

The background is this. Part of Moldova has been a de-facto Russian exclave since 1991, when the Soviet Union died and the Post-Cold War Russian Federation was born. The Republic of Moldova arose along with it. In hindsight its modern history might look like a plan conceived by Mr. Putin, only he wasn't there at the time. A combination of chance and foresight allowed ex-soviet loyalists in Moldova, with open and clandestine support from Russia, to retain a military foothold there on the pretext of guarding a soviet-era munitions depot and armaments factory.

Already before Moldova's independence was fully established, the region along the east bank of the Dniester river declared its secession from Moldova and after a short and bloody war managed to solidify its claim. Transnistria has since been run by old soviet army veterans and emigré politicos in the rebel capital Tiraspol, although no other UN member has ever recognized them. To calm the simmering conflict, the OSCE authorized a peace-keeping force to be stationed in the breakaway republic. Somehow this mission ended up consisting only of Russian military personnel. Russia does not need to invade Moldova. It is already there.

Moldova's divided condition is a nearly perfect example of what a relentless campaign of politico-military meddling and influence-mongering by Russia can produce - and apparently is producing in many other places between the EU and Russia.*

But, to be fair, there is also a strong element of pro-Russian feeling even in the population on the western side. This can be seen in the simultaneous victory of a pro-Russian Socialist party (21%), and the likely majority coalition of three pro-EU parties (jointly 45%, yielding a slim majority in the parliament). The Communists (18%) are not unequivocally pro-Russian, but have for some years declared in favor of closer relations to the EU. The present outcome, divided as it is, is nevertheless not new, it is similar to most previous parliamentary elections in Moldova in which blocs have been hovering around a 50/50 split, with the Communist Party previously in a dominating role it has since lost. Presidential elections, indirect through the parliament, were effectively stalemated for nearly three years from 2009 by political infighting and procedural issues.

Two additional problems add to Moldova's woes: endemic corruption, and near-total dependence on gas from Russia. When gas prices are disputed with Russia, the supply is shut off - always in winter, of course. A combination of these two problems recently showed up when Moldova opened a new gas pipeline from Romania to add an alternative, non-Russian source of energy supply: There was no gas in the pipeline. Surprise!**

In formal terms the Republic of Moldova is an independent state, member of the United Nations, the OSCE and the WTO. Moldova signed an association agreement with the European Union in 2014. The question of candidacy for accession to the EU is not yet on the table, however, and Russia has issued a warning against such a move - in itself indicative of the kind of unashamed pressure the Kremlin applies to presumably independent countries.

Informally, Moldova's political status is therefore a bit ambiguous. The EU, on the other hand, has a considerable presence via bilateral agreements to provide assistance to the reconstruction of key sectors of Moldova's public administration.

Among the multifarious pieces and fragments of the old Soviet Union, Moldova fits a broader pattern: footholds, or toeholds, for Kremlin remote control or influence. Partly on legal grounds, partly on military grounds, partly based on popular affinities. Kaliningrad, annexed in 1944, was perhaps the first of this kind; the annexation of Crimea the most recent. Despite the formalities, Moldova was in reality never released from Russian ties since the Soviet Union collapsed in 1991. Endless talks in various formats, involving at different times the EU, the OSCE, Russia and Ukraine, have tried to untangle the security knot of the armaments depots and the political knot of the divided affections of the population. In the process Moldova's Chisinau government has entered numerous agreements with the breakaway government, many brokered by Russia and Ukraine. These agreements have subsequently tied its hands.***

Only the EU has the potential to drag the country out of Putin's clutches. After the elections the Commission issued a conditionally supportive statement on December 1, 2014 (excerpt):

"... A new impetus to key reforms will be crucial for the Republic of Moldova´s political association and economic integration with the EU. The EU will remain a reliable partner supporting the Republic of Moldova´s reform endeavours and working towards unleashing the full benefits of the Association Agreement in the interest of all its citizens, wherever they live."

It also said:

"The EU remains committed to work with the future government towards a comprehensive, peaceful settlement of the Transnistrian conflict based on the sovereignty and territorial integrity of the Republic of Moldova with a special status for Transnistria. ..."

The issues are recognized, and the slow, patient route towards a solution agreed to by all is pointed out. In Moldova, the EU vs Russia is pedagogy competing with the power of money and weapons.

The big question for the EU is whether the 28 members really want to put the resources and serious effort into it that the problem requires. When it comes to spheres of influence, Putin is serious. In Brussels, spheres of influence are known only as ancient history.

*Judy Dempsey, "The Western Balkans are Becoming Russia's New Playground", November 24, 2014, http://carnegieeurope.eu/strategiceurope/?fa=57301&reloadFlag=1.

**"Empty Pipeline Shows Difficulty Of Breaking Moldova's Gazprom Addiction." By Liliana Barbarosie and Robert Coalson. RFE-RL September 29, 2014.

*** For more on this, see: "Executive Summary: Moldova’s Transnistrian Conflict." Prepared by Olav F. Knudsen, Swedish Institute of International Affairs (SIIA) with assistance from Andris Spruds, Latvian Institute of International Affairs and Barbara Kunz, SIIA.

http://transatlantic.sais-jhu.edu/transatlantic-topics/Articles/friends-of-belarus/moldova_exec_summ.pdf

Decision on Catalonia - updated

Catalonia's informal consultation of the public's opinion November 9th about independence from Spain ended with a whimper. While the Catalonian government and friendly foreign press reported an impressive support for independence with 80% yes votes, voter turnout was rarely cited. It was in fact very low, 36 %. Nearly two thirds of the voters stayed home, in other words. No big step forward for the independence movement occurred, rather the opposite. And the chances of some kind of agreement with Madrid are now more remote than ever.

So, why could not reasonable political leaders, who disagree fundamentally, but still inhabit the same country and live under the same laws, sit down and talk like civilized people about the issues that divide them? Probably because the issues between Barcelona and Madrid, or between Spain and its autonomous community Catalonia, are not really substantial (see my blogs January 2014, September 2013, November 2012, October 2012). This is also obviously why so many voters declined to participate. 

Europe supposedly is the home of political reason. But secession, like amputation, is a painful matter. One way to handle such business was recently demonstrated by Russia, who seized Crimea from Ukraine after a sham referendum. No need to talk there. At the other extreme, in September 2014 Scotland and the United Kingdom showed the world how to go about this kind of affair in a civilized manner.

In Spain, as the Catalonian issue has surged during the last few years, the two sides have repeatedly urged negotiations. A few attempts have been made to start talking. Nevertheless, nothing has come out of it. Spain's Premier Rajoy has dragged his feet, bolstered no doubt by the clear letter of the Spanish constitution, the strong legalistic tradition of his country and the absolute majority his party (Partido Popular) enjoys in the national assembly. Catalonian president Artur Mas has been the vocal force behind the Catalonian campaign. He promised nevertheless after one of these sessions in Madrid that he would do nothing illegal. Yet his actions at home leave that in doubt.

Catalonia and Mas have continued to declare their intentions quite clearly, followed up with formal steps. In early 2013 the Catalonian parlament passed a resolution declaring sovereignty and independence for Catalonia. The Spanish government responded by calling for the Spanish Constitutional Court to decide on the declaration's constitutionality. The court responded by ordering the suspension of all efforts to prepare for implementation of the declaration (April 2013).

Still, Catalonia's government proceeded half a year later to pick a date for the referendum (to take place on November 9, 2014). The wording of the questions to be asked at the referendum was decided at the same time. In January (2014) Catalonian members of the Spanish national assembly in Madrid proposed to the Congress to permit a referendum to take place in Catalonia about future relations between Spain and Catalonia, a belated nod to the UK procedure. The proposal was rejected out of hand. Perhaps too hastily.

Scotland's forthcoming decision then kept all in suspense from March to September this year. The subsequent failure of the Scottish independence campaign triggered further immediate steps in Spain. Within days, the Catalonian parlament decided, in spite of the Constitutional Court's earlier decision, to go ahead with preparations for the November 9 referendum. President Mas signed a decree following up on the practical preparations. Madrid responded with dispatch, submitting the case once more to the Constitutional Court, and receiving its preliminary judgement a few days later: Catalonia's decisions were illegal.

President Artur Mas, the self-declared law-abider, was not deterred. True to his demagogic bent, he proceeded from formality to informality. If we are not allowed a formal referendum, then why not go for a spontaneous, informal one? Let the people come forth. We will provide rooms for the occasion. "Bring your own paper and pencil." That certainly cannot be illegal?

Madrid thought otherwise. After first appearing to brush this latest attempt aside as farce, the government on October 31 brought even this matter to the urgent attention of the Constitutional Court, arguing that the realities of the case were the same as before. On November 6, the Court decided to suspend even this alternative version of the referendum.

Secession is indeed difficult.

In legal terms this case is closed. In political terms it might have been possible to solve more smoothly with some give and take. Here, I believe, is where North European and Spanish political cultures diverge. In Spanish thinking "the law is the law". Further north the thinking is, there is always room for discussion. Madrid does not want to discuss with Barcelona as long as the law has the answer. This may be good law, but not excellent politics.

Moreover, there are others queuing up behind Catalonia, above all the Basque Country, which to me has a stronger case for independence, at least politically. Other autonomous regions may also aspire to the same. The central government is bound to deal with all of them if it cannot stop Catalonia now. This points to the larger issue.

Spain would benefit from a structural makeover to let its constituent 17 pieces fit better into the whole. This is a constitutional issue, left only half resolved by the democratic document of 1978. As an insolent outsider, I would suggest the Spanish Constitution must be revised to give the country a clearer federal structure. Several parties in Spain have already had this demand on their program for some time.

The issue is not only a Spanish or a British one. It affects the whole European region, partly with side effects, partly with the contagion of separatist sentiment. It is somewhat problematic in this context that the EU has assumed such great competence and is making such great resources available to regions within member countries, bypassing their national governments, at least in a political (though not juridical) sense.

So to Catalonia's demand, there is a counter-question: What if all the rest of the regions of Spain, of Britain, of France, and of Italy, ... (etc) were to make the same demand? Why should their demands not be met? Yes, why not, indeed? We are approaching the realm of child-rearing here, the problematic sort that raises all kinds of issues. "If the kid wants something, let him have it." Catalonia's case is not a forced union. The last time Catalonia had a referendum - some thirtyfive years ago - it was along with all of Spain, and Catalonia voted yes to the Spanish constitution with over 90%, the highest in Spain. They freely chose it, and they should be made to make the best of it.

Says this supporter of Baltic independence in the 1990s (they left a forced union), and supporter of Norwegian secession in 1905 (also from a forced union). I hate to think what kind of Europe would be the outcome of secession on demand.

Catalonian Games

(This post is no longer relevant, since the Congress of Deputies in Madrid voted a resounding No to the Catalonian proposal on April 8, 2014. I leave it here nevertheless, for whatever interest the details of the proposal might have.)

The Spanish Constitution of 1978 explicitly declares the country is indivisible. That constitution was adopted in a referendum in which more than 80% voted yes, and Catalonians voted more than 90% yes. Times do change.

When I last wrote on Catalonia, its President Artur Mas had just declared that he would not do anything illegal in his quest for independence. Not long after that the Catalonian government made public its proposed questions for a referendum on independence, and announced that it would be held on the 9th of November 2014. The government in Madrid, however, made clear in no uncertain terms there would be no referendum. 

Then, in mid-January 2014, came the next rebellious step from Catalonia. The Parlament in Barcelona decided by a nearly two-thirds majority to ask the Spanish Congress for permission to hold a referendum. 

This request by the Catalonian Parlement has been widely interpreted as a plea to be allowed to vote on independence. But this is not what the proposal says. Anyone who reads the Spanish text will see that it is much more intricately worded than that. The request is framed within a constitutional provision (article 150.2) that enables delegation of extraordinary power to an autonomous community such as Catalonia to undertake exceptional measures for a limited time, in this case a referendum. In the proposal the word "independence" is not mentioned. The stated objective is to allow Catalonians to express their views in a consultative referendum on "the collective political future of Catalonia, taking as its point of departure terms to be agreed with the Government (of Spain)". 

Obviously, independence is not mentioned because it is prohibited by the Spanish Constitution. But then why ask permission for a referendum anyway? I can see a couple of reasons why. 

1. It is the civilized thing to do, what Europe would expect, and what Scotland already did in a similar situation. To refuse to allow a simple advisory expression of popular opinion will be very poorly received outside Spain, and the political battle over Catalonia's future has in large part become a contest over images in international media. Madrid would come out looking exceedingly bad if they refuse.

2. If the request is accepted - along with some kind of (miraculously) negotiated agreement - Catalonia and Madrid might actually come to terms in a way that saves face on both sides, provided the question to be voted upon does not refer to "independence". It is fairly certain that while a Catalonian vote could exceed 50% yes to something phrased akin to independence, it is unlikely to offer a political platform for secession. 

Regardless of all the rhetoric, secession even after a 60% yes vote would be a political non-starter, a project doomed to failure - with Catalonia left outside the EU and with Spain subsequently vetoing its application to become a member of the Union. In my judgment therefore, Artur Mas is already in a dead-end street. A referendum result of about 50% would let him bow out gracefully, and Catalonia could continue in its role as an intransigent region of Spain.

3. It is also possible that the request is simply a political trap, designed specifically to be rejected by Mr. Rajoy. Like practically everyone else, he may brush aside the objection that independence is not mentioned, because (as one can imagine him saying) "everyone knows what the Catalonians want, and this is how they have planned to wangle it out of us". So he and his party will deny the request with his absolute majority in the Congress of Deputies. From the perspective of the independence supporters in Barcelona, such an outcome would be just what they want, and to them politically, utterly insignificant. They would move ahead with their referendum in any case, and the whole thing would simply be a great publicity victory for Catalonia abroad.

But this last possibility will not change the political realities that come after a vote in favor of Catalonian independence. Either Mas gets off the bus at that point, and all will be reasonably well for the great majority of Catalonians - even those who saw their dream crushed. 

Or Artur Mas will charge ahead with an independent Catalonia into the great unknown, with or (if he is fortunate) without Spanish troops at his heels. 

Puzzle of Catalonia's Independence Elections Nov 25

Catalonia's extraordinary parliamentary elections on November 25 was a big let-down for the initiator, President Artur Mas. The point of having a snap election was to have his party benefit from a presumed new wave of support for independence from Spain. That has now proved a mirage. And Mr. Mas had really gone out on a limb during the campaign, promoting his scheme with bold words, raising unfounded prospects of immediate EU membership for an independent Catalonia and offending the Madrid government along the way with brazen statements – all of which now puts his failure in an even worse light.

As it turned out, his center-right party, CiU (Convergència i Unió), lost dramatically, dropping from 62 to 50 seats in the 135-seat parliament. At the same time the leftist republican independence party ERC (Esquerra Republicana de Catalunya) had a very good election result, doubling their number of seats and recapturing the strength they had before 2010.

For two parties with the same main goal to come out with opposite results is, indeed,  strange. It becomes even stranger by the biases at work in the reporting. Many news headlines in Spain and around the world pronounce CiU the winner. Of course, CiU does come out way ahead of all other parties, twice as big as the next party. The only thing is, CiU was even bigger before.

What is remarkable in these election results is that CiU, the strongest independence party, finds itself rejected, while there is still a majority of seats won by parties in favor of independence. Actually, the proportion is almost exactly the same it was before the elections (independence parties CiU + ERC 72 seats until Nov 25, 71 seats after). The strength of independence opinion is also seen in the shares of votes cast: about 57% in favor of independence from Spain if you add in the smaller parties - ICV-EUiA (Greens) with 10% of the vote, and CUP (Candidatura Unitat Popular) 3,5%. Previously, during the election campaign the figure 57% in favor of independence from Spain was measured in polls conducted during November. (Hence, my previous blog on this subject was in error regarding this statistic.) There is, in other words, an undeniable sentiment favoring independence in Catalonia, and it has not become weaker. 

Nevertheless, given all the loud campaigning in favor of a push for a referendum, this election must be deemed a failure for that cause. No wonder Mas has called for a moment of reflection.

In the meantime Catalonia needs a government. There are three other parties that have enough seats to bring about a majority, but only one of those (ERC) is in favor of independence. That is, conservative CiU has no other potential partner to govern with than leftist ERC. The latter's leader, Oriol Junqueras, sounds like he is favorable to a collaboration with CiU, despite their ideological differences. The project of a referendum on independence is still one on which the two parties have the same view. They also have it within their power to bring it about, although such a coalition itself would be unprecedented.

However, the future for an independent Catalonia no longer seems as bright as before. EU Commission President José Manuel Barroso has said in no uncertain terms that a new state seceding from an existing EU member state will not automatically become an EU member. It will first have the status of «third country» with respect to the EU, and will have to apply for membership like any other non-member. New members will need the affirmative vote of all existing members, including Spain. Obviously, a runaway former province of Spain will not receive that crucial vote.

Wisely, by this announcement the EU has dampened the independence zeal of many a discontented province in its member countries, among which may currently be counted at least Scotland and the Flemish part of Belgium.

Catalonia's Challenge to Spain

Is this a soap opera? Four Spanish EU parliamentarians send a letter to the EU Commissioner Viviane Reding asking for protection by the European Union against the Spanish government – their own government! We Europeans know about the claims to independence of Basques and Catalans. These are claims of considerable minorities in the Basque Country and even of a majority in Catalonia, if we discount the wide split between Catalan parties of the left and parties of the right.(*) These claims have been heard for decades, nay for centuries. Their fate has been like that of any other political demands that keep being repeated, but are ultimately not acted upon. Such claims may be (as in these cases they are) respected as legitimate, but in the end not taken seriously; they are filed away as curiosities. This is how Europe has dealt with the aspirations of the Basque Country and Catalonia whenever they have turned up.

So what is different this time? How can an admittedly major region of a major European country suddenly raise such a ruckus about its autonomy that threats of countermeasures of all kinds – bar none, even military intervention - begin to fly?

The notice of Catalan President Artur Mas of an advance election to the Catalan legislature, el Parlament, on November 25 has injected additional nervousness into Spanish politics at a time when there already existed intense pressure from street protests and the hardship of the economic crisis in the country at large. The jittery state of the reactions has to do with the election being a step in the reassertion of the old Catalan claim to independence, previously never taken completely seriously. This time, however, it appears to be different, not least due to Spain's exposed situation in the euro crisis.

The background is the fact that the Spanish system for collecting taxes and dividing authority between the central government in Madrid and the regional governments in the 19 autonomous communities was only sketchily designed from the start (in the 1978 constitution). The legislation and executive provisions of the financial authorities seem at a glance to be adequate, but have obviously not been followed up in practice. This gap in executive follow-up has allowed the regions and their underlying governing levels – the provinces and the municipalities - to amass debt, way beyond what they should have. As long as the economy was booming there was no visible problem, but after the turn of the tide that is all different. The fiscal system has been put to an extreme test in the current hardship and appears not to be able to survive it without major revision. And coping with crisis and revising the system at the same time is not a good approach.

Most of the autonomous communities (regions) of Spain are currently unable to service their debt. Madrid this year set up a sizable relief fund to help them out. Catalonia and most other regions have requested a share of that fund, which they will probably receive. However, Catalonia has later come back and asked for as much more, which would, if granted, leave them in possession of more than half of the entire fund. That second request has (understandably) been denied. Then Catalonia asked for – and was denied – the same fiscal status as two other autonomous communities, Pais Vasco (the Basque Country) and Navarra, who for historical reasons have a so called “fiscal pact” with Madrid.

This is where Spain is most at fault at the central level, and where the constitutional system fails. Catalonia claims to be a victim of an unjust system because they pay much more to the central government than they get back. But for starters, this is a much used system in developed industrialized countries. Among countries with a similarly decentralized structure as Spain, Germany has it, Switzerland has it, Canada and Australia have it. Moreover, in more simply structured, smaller centralized countries like Norway, Sweden and others, rich municipalities pay into a redistribution system that benefits the poorest municipalities. In all of these countries, the richer communities pay more into the country's governmental system than they receive back. Mind you, many of them don't think it is fair, and they all grumble. But it is standard governmental practice within the OECD. Moreover, studies of well-being in the Spanish autonomous communities show that Catalonia's living conditions place it among the four best endowed regions in Spain (figures for 2000 and 2006, Jurado & Perez-Mayo, Social Indicators Research, 2012). It is thus not surprising that they are asked to contribute more to their less favored compatriots.

A cross-national comparison of five countries with similar systems of redistribution (Australia, Canada, Germany, Spain and Switzerland) shows Spain to be quite ordinary among the rest, and indeed less harsh than other systems. In fact, Spain has the second softest of the tax transfer arrangements among these five countries. On the other hand, the monetary effects of these transfers are also less than in the four other countries except Switzerland. In other words, Spain has a fairly benign system with comparatively less impressive transfer results. (See the study by Hierro et al, Revista de Economía Aplicada, 2010.)

What is the problem then? Is Catalonia complaining without reason? Not as I see it. The complaints are just aimed at the wrong target. Where the Spanish system has gone wrong – in addition to not overseeing the communities' observance of the rules in force - is in allowing some of the regions, for historical reasons, to have a more advantageous organization than the others. The foral system has left Pais Vasco and Navarra in what one study has characterized as a “scandalously favorable” situation (Ángel de la Fuente, “Sobre el Pacto Fiscal y el sistema de Concierto.” Fundacion SEPI, 2012).

Although Angel seems to be speaking Catalonia's case, he is actually giving a quite even-handed evaluation in which his first judgment is that no government in a similar situation has allowed its subordinate regions to decide on their tax collection system by themselves. All other Spanish regions have offices of the central tax ministry (Hacienda) located throughout their territories. Not Pais Vasco and Navarra. Their agencies collect the taxes on behalf of the central government. The central government, therefore, is not participating in these communities' tax collection process. Hacienda are just handed over the money bags “at the border”, as it were.

My conclusion is therefore that Catalonia has a point, but the resolution is not to give them the same exceptional system. Rather, the solution must be to remove the foral system in Navarra and Pais Vasco and instate instead the one in force in the rest of Spain. That, of course, would be to challenge all the forces of nationalism in these regions and unleash a new battle of the regions.

Poor Spain.

(* Correction here of previous text. Catalan opinion favoring independence according to polls in November 2012 is 57%, similar results found in election of November 25, 2012, though  people holding this view were split between four parties of both left and right.)