FORMER ROMANIAN RULING PARTY FACES LEADERSHIP

C O N F I D E N T I A L SECTION 01 OF 02 BUCHAREST 000199

SIPDIS

STATE DEPT FOR EUR/NCE - WILLIAM SILKWORTH
STATE ALSO FOR INR/B

E.O. 12958: DECL: 01/21/2015
TAGS: PGOV PREL KDEM SOCI ECON PINR RO
SUBJECT: FORMER ROMANIAN RULING PARTY FACES LEADERSHIP
STRUGGLE, CONFRONTS INTERNAL DIVISIONS

REF: 04 BUCHAREST 3478

Classified By: POLITICAL SECTION CHIEF ROBERT GILCHRIST FOR REASONS 1.4
B AND D


1. (C) Summary. The formerly ruling center-left Social
Democratic Party (PSD) is roiled by internal divisions and
faces a leadership struggle, with former President Ion
Iliescu and ex-PM Adrian Nastase the principle contenders to
lead the party. The PSD recently reestablished its
"Permanent Delegation," most of whose members are
long-standing Iliescu allies. After four years in power, the
PSD faces an identity crisis as it attempts to redefine
itself as an opposition party. End Summary.

Jockeying for Position in Former Ruling Party
--------------

2. (C) The PSD first tried to take stock of itself after it
suffered surprising losses in major urban centers in June
municipal elections. Arguably, the attempt to reinvent
itself as a more vigorous, younger, less arrogant and less
corrupt party failed. The voters' verdict in parliamentary
elections in November gave a slight majority of Senate and
chamber seats to non-PSD parties, and with Bucharest mayor
Basescu soundly defeating ex-PM Nastase in the race for the
Presidency. The knives have been out ever since and the
number of explanations for the PSD's loss of power are
numerous. According to PSD insiders, the party will likely
hold a congress in April to elect the party's leaders and
restore a semblance of unity. PSD members paint a picture of
a party divided into several factions, with the principal
contenders for the party's leadership being former President
Ion Iliescu and ex-PM (and losing 2004 presidential
candidate) Adrian Nastase.


3. (C) Iliescu has publicly declared that he offers the
party "experience and credibility." Rather less believably
he also claimed to represent "new thinking," since his
presidency over the past four years supposedly kept him above
the party fray. Iliescu's supporters include many
influential, long-standing PSD local politicians - referred
to derisively by ordinary Romanians and the independent media
as the PSD's "barons." A senior PSD politician told PolOff,
however, that many rank and file PSD members are furious at
Iliescu for his decision just before the expiration of his
mandate to pardon notorious miners' leader Miron Cozma (Ref).
Another commonly heard criticism of Iliescu, both within and
without the PSD, is that he represents the "old face" of PSD,
attracting mainly older and rural voters and not appealing to
younger, urban citizens. Iliescu recently publicly called
efforts to reform the party "crude" and "primitive," while
offering no obvious alternate vision.


4. (C) The loose faction clustering around Chamber of
Deputies President and ex-PM Nastase probably has less
influence within the party than the pro-Iliescu group; some
PSD members opine that his loss to Basescu in the
presidential contest disqualifies him from leading the party.
Many Embassy interlocutors have also noted that Nastase
lacks the personal appeal that Iliescu has with voters in the
rural portion of the country -- one contact asserted that
Iliescu has an image as "Romania's collective grandpa," while
Nastase's alleged possession of multiple homes and luxury
cars, together with habitually prickly reactions to
criticisms, contributed to his image as "aloof and corrupt."
Although Nastase has attempted to keep his hat in the
political ring by launching a steady stream of criticism
against President Traian Basescu and PM Calin
Popescu-Tariceanu, recent press reports have mocked Nastase
for reportedly maintaining a staff of 46 "assistants," noting
that such a large contingent is more suitable for a PM than
the President of the Chamber of Deputies. Incoming PM
Tariceanu also complained that Nastase and his staff prior to
their departure had basically cleaned out much of the prime
ministerial palace of furniture and equipment, even removing
telephones and canceling service in many offices.

PSD Reform Movement?
--------------

5. (C) Meanwhile, a January 10 gathering of fourteen party
leaders from Transylvania, coordinated by ex-Interior
Minister Ioan Rus, called for internal reforms and
democratization of decision-making processes within the PSD.
Party activists have told us that many PSD leaders,
especially those from Transylvania, are dissatisfied with the
choice of either Iliescu or Nastase to lead the party and
would welcome a "reform" leader. Names bruited include Rus,
former FM Mircea Geoana, and ex-Justice Minister Cristian
Diaconescu. One PSD insider described Rus, despite his
popularity among PSD members in Transylvania, as lacking the
political will to mount a leadership struggle against Iliescu
and Nastase.


6. (C) Although both Diaconescu and Geoana are personally
popular within the party, especially among younger members,
neither man has the backing of a powerful local machine. Nor
do they have noticeable support from those in the party with
access to resources or influence outside of Bucharest.
Additionally, the party's senior leaders will insist on an
open ballot leadership vote at the April party congress, in
lieu of a secret ballot, and few rank and file members will
dare to publicly challenge the barons' "recommendations."
Finally, PSD sources tell us that Iliescu and Nastase are
discussing a possible compromise under which Iliescu would be
elected PSD "Founder and President" and Nastase would be
elected PSD "President." Leadership questions aside, local
PSD activists are impatient with the PSD's "top-down"
management style. One bone of contention among the rank and
file was the party's "primaries" last year, derided as a sham
process in which senior leaders selected the PSD's
parliamentary candidates, despite public proclamations that
the process would be transparent and democratic. This
dissatisfaction could spill over into the party congress.

Return of the Barons (They Never Really Left)
--------------

7. (C) According to reliable reports, PSD's senior leaders
have decided to reestablish the party's so-called "Permanent
Delegation," essentially a steering committee of the party's
most senior leaders. In an attempt to whitewash the party's
image following the PSD's surprisingly poor results in June
2004 local elections, party elders replaced the Permanent
Delegation with a "Coordinating Bureau" that excluded some of
the PSD's most notorious local leaders (although they
continued to play key behind the scene roles). The new
Permanent Bureau comprises 23 prominent PSD members. Most
are long-standing Iliescu allies (read: barons) and many cut
their political teeth during the communist era. The
Permanent Delegation's members include reputedly corrupt
figures, such as former Transport Minister Miron Mitrea and
former Tourism Minister Dan Matei Agathon. Other key Iliescu
allies among the 17 member Bureau include respected former
Defense Minister Ioan Mircea Pascu and former Trade and
Economy Minister Dan Ioan Popescu. The minority of
non-Iliescu supporters includes ex-FM Geoana, ex-Interior
Minister Rus, and ex-FM Mihai Tanasescu. Most analysts
conclude that the re-establishment of the Permanent
Delegation and its majority make up of Iliescu hands amounts
to a tactical victory for Iliescu in his ongoing struggle
with Nastase for control of the party.


8. (C) Comment. The former ruling PSD faces an identity
crisis as it comes to grips with the unpleasant reality that
after four years of governing it must now decide who will
lead it in opposition. Many rank and file PSD members have
expressed hope that the party would reinvent itself as a more
modern social democratic movement. However, the persistence
at the core of the party of local barons and former senior
communist officials, including in the reestablished permanent
delegation, gives little hope for real reform in the short
term. One Basescu advisor told PolChief that the PSD is
banking on eventual failure by the Basescu and Tariceanu-run
government and in a few years hopes to return to power, as in
2000, as the voters' "only option." The advisor said Basescu
is "absolutely committed" to preventing this scenario. Over
time, the PSD has attracted modernizers or technocrats such
as Geoana, Rus, and Diaconescu. However, despite popular
support, thus far such members have failed to capture control
of critical levers of power within the party. Therefore,
true reform will likely be delayed. End Comment.


9. (U) Amembassy Bucharest,s reporting telegrams are
available on the Bucharest SIPRNET Website:
www.state.sgov.gov/p/eur/bucharest

Delare

DELARE