West to the sun - or East to goodness knows what?

This afternoon I had a long phone call from a Latvian who liked my Blogs. It was good natured and educative. But I had a strange feeling from his words that I am inhabiting a strange parallel world here in Riga that many Latvians do not see. Everyone and everything was to blame except normal Latvians for the crisis. I could easily blame the Latvian language. When you translate Articles, Blogs and comments it is clear that no one here knows how to say anything straightforward. The future is never discussed. We go through every historical twist and turn, every shred of irony and call on every allegory we can think of. Every politician stinks, is to blame for something and is dishonest. Or worse all are secret Skele or Lembergs moles under deep deep cover to re-emerge like butterflies from the chrysalis at some later time. Emerging of course to return the country to darkness. And the EU and IMF are totally to blame for all this. No Latvian ever seems to blame themselves, even those who voted for the most corrupt. The language mix is simply impossible to follow for a foreigner. No wonder the Russian speakers stick to Russian to communicate.

But I wonder if we are not reaching a point where something here has to change. This week the Finance Minister Einars Repse has tried (or has actually succeeded - we have to wait and see) to sack the head of the State Revenue Service, Dzintars Jakans. The man has actually been dragging his feet badly on reform. This could be for many reasons and the conspiracy theorists will find loads, but I suspect that he is another past political appointee who like many in power simply has no clue what to do at all. Reform = cuts, doesn't it? The Peoples Party aided by the Goons and Farmers want to use this sacking as an excuse to bring down the government, but conveniently they say they will wait until after the budget is finished at the end of the year. I don't think they know how stupid and weak that makes them look. They had all day Friday to act if they thought they had a real case, but they showed what cowards they are by doing nothing. I guess that's because they know the only person who can do the real budget work is Repse and they have to wait until he is finished.

The real opposition forces in the form of the Oligarchs have been plotting too and Lembergs, Slessers and Skele (he came back the week before last amid trumpets, dancing girls and ribbons to save us all) have formed a new political Axis. Perhaps in half hearted opposition, former President VVF has also thrown her political hat into the ring and started with education reform. The comments were mixed. Many were saying thank God she is back whilst others were more vitriolic about the "Canadian" noting that she was in charge during the 7 fat years and did nothing. Mind she is not an economist!

So what next. If the coalition is going to fall we could be seeing a major turning point in Latvian politics. The end game might be closer than we think. A left turn to corruption and closer ties with Russia, or a right turn to honest government and a chance of a better future. The choice might just come down to the stubbornness of Repse and the decisions of the President. But it is clear that whoever holds the levers of power as we go into the election next summer will have the scope to bribe and fool the population. The big prize is to steal the EU and IMF money - and there are those who eye this greedily.

Sadly, I suspect that good Latvians will wait much longer before they really fight back. They would much rather sing their way to democracy than be active. But that will not work this time folks. The enemy are Latvians too and understand the weakness of this. Those in the countryside just hope the IMF or EU will come on white horses and save them. The Russian speakers keep their heads down and try to get by or even earn enough to live well. Latvian weakness is their political opportunity. And the forces of evil will rub their hands with glee as Latvia becomes more like a failed African state every day. They know that if good men and women continue to do nothing they will be the eventual winners.

And all the while, Russia waits and watches like a hungry vulture.

Have we turned a corner or is this a false dawn?

The last few weeks have been quite difficult for me. I have been trying hard to find new clients and have only found people who were clearly worse off than me. I have been looking at the evidence of what is happening really hard but it is difficult to call. There is a noticeable increase in traffic on the roads, almost back to old times. People are going about their business and daily lives with apparent normality.

But my instinct is to think that this normality covers a whole multitude of sins. The number of Pardod (for sale) signs continues to rise (although I am pleased that my friend Alexanders who runs Mobius selling expensive British Vertu mobile phones has opened another shop in the old town) but in general there still appear to be more businesses closing than opening. There are almost NO adverts on the trams and buses. The exceptions are the big mobile phone companies who are having their own battle royal for our ears and fine words. The prices in most shops have dropped agin. Some have put up prices but they don't seem to have customers. I cannot ever remember seeing any people in one or two shops - but still they stay there. One or two have grasped the nettle and have reinvented themselves to a new lower price level quite successfully. The pubs are mainly empty except for those used by tourists. One nightclub I heard about had no one at all one day last week. Heating bills will arrive this month and that means a direct export to pay for energy- well if people can pay that is. In opposition, the National Bank Governor says we have turned a corner.

We are at the point where the international community (IMF, EU, Swedish banks etc) is demanding that 500m Lats are cut from the government budget. Now some of this will stay in circulation but there are bound to be more effects and they cannot be positive. Tax rises cannot stimulate anything, even accountancy firms!

So my instinct is that what we see is the tip of the iceberg. The big bad bit is under the surface, and with lots of sharp edges. What is amazing is the stoical way society continues its daily round. I suppose that after occupation by the Nazis and USSR, this is just another bit of stress to be suffered. It is just a shame that this time the punishment is being meted out by Latvians upon themselves.

IS LATVIA IN BIG TROUBLE?

Last week a university lecturer in Latvia was arrested by the police for talking down the economy. Speaking your mind is still not a free sport in this democracy. I can quite accept this if is he intended to benefit financially by his actions but it looks as though he merely felt he had to tell his version of the truth. Still there are more twists and turns in this country than a formula one circuit, so it would not surprise me if he does not turn out to be the brother in law of the head of the stock exchange or something. But it is a warning that I must not say anything naughty in my Blogs about the Lat.



My friend was made unemployed last week. She went to the unemployment office yesterday. Apparently the Government has removed 2.5million Lats from the budget of that organisation so they had fired some of their staff. There were not enough people there to process those applying and the awful rumour went around that there would not even be enough money to pay the legal payments. Now that would be interesting. It must be a strange feeling losing your job and then queuing to ask a former colleague for money.


The Government has gone cap in hand to the EU for a figure reportedly to be about 5Bn Euro (although one rumour says 13Bn). That would be half the GDP for this year. It is probably needed but it is hard to see how it can be paid back in a hurry. But it makes Gordon Browns efforts in UK seem cheap by comparison. That much money would be a lot more to waste on expensive and inefficient latvian government building projects.


Another friend of mine got the sack this morning. He was quite good at his job but the company are restructuring - that is Latvian for sacking people to save money - and he just happened to draw the short straw. At 28 he is mortified that his previously upward career has suddenly taken a sharp downward move. But he is sharp enough to move on quickly. Many of those I interview for work are Post Soviet followers by training and inclination and simply without any initiative. I am trying to find a shop manager with drive and it is like looking for the proverbial needle in a haystack

Other evidence of recession is still hard to guage. In many of the shops, the lonely shopgirl stands alone waiting for the weekly customer, but this was always so in Riga. Most shops simply charge far too much for their goods and the items are just not worth it. Better to fly Ryanair to UK and shop in Bishops Stortford. In one of the expensive shops on saturday there were still plenty of active and rich looking women. But this may just be them shopping hard before husband says - enough Olga, we are poor too now too. Our driver is poor, our maid is poor etc etc. In the supermarkets the shopping baskets are still full and there seems little inclination to cut family costs. Many people are still eating out at lunchtime. I watch carefully for signs of change in Chilli Pizza .

I have had a welcoming amount of comments about my previous Blog and without exception they have been supportive about my stand for the law to apply fairly and evenly. We shall see if it ever causes change. Somehow I doubt it will happen soon.

Anyway, off to edit an article on Latvia - Russia relations for Artis Pabriks former Foreign Minister. Then I must do some paying work.....