FORMER ROMANIAN RULING PARTY PREPARES FOR NATIONAL

C O N F I D E N T I A L SECTION 01 OF 02 BUCHAREST 000982

SIPDIS

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

E.O. 12958: DECL: 04/20/2015
TAGS: PGOV PREL KDEM SOCI ECON PINR RO
SUBJECT: FORMER ROMANIAN RULING PARTY PREPARES FOR NATIONAL
CONGRESS; FEW PROSPECTS FOR REFORM

REF: BUCHAREST 199

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


1. (SBU) Summary. The Social Democratic Party (PSD) holds
its national Congress April 21-22, an event at which
ex-Romanian President Ion Iliescu will likely be elected
party president while former Prime Minister Adrian Nastase
will probably win the number two slot of Executive President.
Despite some dissent within the party and a challenge by
several party "reformers" during the Congress, PSD insiders
and independent analysts predict that the party's old guard
will triumph, noting the recent selection of local leaders
from the ranks of party "barons." Nonetheless, secret
balloting during the congress (a first for the PSD) and
opportunities for dissenters to mount the rostrum guarantee
that the congress' outcome is not a foregone conclusion. End
Summary.

Out with the Old, In With the...Old
--------------

2. (C) The PSD has faced an identity crisis and internal
power struggle since PM Nastase's unexpected defeat in the
December 2004 presidential elections by Bucharest Mayor
Traian Basescu and the subsequent formation of a center-right
coalition government led by PM Calin Popescu-Tariceanu (Ref).
Soon after the fall elections, former Interior Minister Ioan
Rus called publicly for revitalization of the party, urging
vigorous attempts to recruit young supporters. More than
four months after the parliamentary and presidential
elections, Rus remains an influential voice within the party,
especially in his region of Transylvania, calling for "new
leadership" and urging former President and party founder Ion
Iliescu not to run for party president. His allies include
popular ex-FM Mircea Geoana, ex-Justice Minister Cristian
Diaconescu and ex-Finance Minister Mihai Tanasescu.


3. (C) In the face of these calls for reform, the PSD
"barons" - Romanian political shorthand for powerful, often
corrupt local party leaders - have circled the wagons.
During the first two weeks of April, local party officials
across Romania chose the leaders of each of the nation's 41
judeti (counties) plus Bucharest. They include almost no
fresh faces and the list of "new" county leaders is heavily
weighted toward incumbents, including such notorious local
heavyweights as Constanta Mayor Radu Mazare (who reputedly
has ties to organized crime),Bacau party boss Viorel
Hrebenciuc (linked to several corruption scandals, including
the RAFO-Onesti refinery privatization),Bucharest's Dan Ioan
Popescu (also linked to corruption allegations) and Vrancea's
Marian Oprisan (frequently cited as one of the most
heavy-handed local officials). Independent analysts point to
these local elections as proof positive that the PSD is not
ready to adopt meaningful internal reforms.

Party Congress - Reform or More of the Same?
--------------

4. (SBU) Over the past several weeks, senior PSD officials
seeking election to national party offices have traveled
across Romania courting local PSD organizations. According
to credible inside reports, Iliescu, Nastase, PSD Vice
President Miron Mitrea and the Rus-led reformers each can
count on the support of about an equal number of county
organizations. Local support is crucial at the congress,
since the PSD's county leaders are instrumental in selecting
the 1500 plus delegates for the April 21-22 party national
congress. Many, if not most, delegates will probably follow
the direction of their county's leader. An important wrinkle
to this year's congress, however, is the fact that election
of party national officers, who will serve for two-year
terms, will be by secret ballot - a first for the PSD.


5. (SBU) PSD insiders confirm that Iliescu and Nastase have
temporarily put aside their bitter political rivalry,
agreeing that Iliescu should be elected party President, with
Nastase filling the post of Executive President. The
Iliescu-Nastase accord averts a confrontation during the
congress between the PSD's two most powerful leaders. Miron
Mitrea, one of the PSD's most effective, longstanding
political insiders and head of the PSD parliamentary group in
the Chamber of Deputies, has announced that he will seek the
party's number three slot, Secretary General, opposed only by
the young and outspoken, but politically weak Victor Ponta.
Many analysts view Mitrea's bid for the SecGen slot as proof
of his tacit assent to the Iliescu-Nastase entente.


6. (C) Adding a wild card to these calculations was the
April 19 announcement by Geoana that he would compete against
Iliescu for the party presidency. Former party spokesman
Serban Nicolae has also announced his intention to compete
for the job, thereby potentially splitting the reformist
vote. Geoana declared April 15 that proponents of change
will consider "a radical strategy" if the congress fails to
"renew and modernize" the party. That message was also given
to the Charge in a recent conversation with ex-Justice
Minister Diaconescu. He said that he, Rus and Tanasescu
would all join Geoana in seeking high office in the party
hierarchy at the Congress. Failing that, the door leading to
a bolt from the party was open.


7. (SBU) The congress will also decide how many VP positions
the party will have, but party leaders indicate that initial
plans are to shrink the total number of VP positions
(currently at 17),possibly boding for heightened competition
during the congress for fewer posts. Many of the PSD's
current vice presidents, including Senate President Nicolae
Vacaroiu, Rus, Diaconescu, Tanasescu, and respected ex-DefMin
Ioan Mircea Pascu have announced their intention to run for
VP slots. In addition to selecting national party leaders
for the next two years, the delegates will also vote on the
party's internal regulations and platform.


8. (C) Comment. Despite battle lines drawn between the "old
guard" and ostensible reformers, the PSD's leaders are eager
to avoid the kind of damaging public split that enfeebled the
party in the late 1990's. Political analysts stress that the
PSD faces virtually the same dilemma now as it did in 1997.
They find themselves unexpectedly in the opposition after
several years in power. They are divided by recriminations
about the reasons for their electoral loss, and split between
an anti-corruption reformist wing and solidly-entrenched
party barons (mostly the same barons as in 1997). The
difference between then and now is that senior leaders have
been working behind the scenes to smooth over differences
before the congress and avoid a public blood bath, viz., the
Iliescu-Nastase entente. Geoana remains the single most
popular PSD politician on a national level, according to
opinion polls. However, he, Rus and their supporters lack
both a political machine that compares with the forces
wielded by the party barons, or their down and dirty
aggressiveness.


9. (C) Additionally, many of the PSD insiders we have spoken
with are far more focused on internal party politics than on
expanding the party's shrinking electoral base (currently
made up primarily of aging and rural voters) or countering
the wave of popularity that Basescu and the Tariceanu
government have capitalized on since the fall elections.
Indeed, one PSD kingpin confided to PolChief recently that
the party's strategy relies on the center-right alliance's
"making a mistake," acknowledging with a rueful shrug that
the PSD lacks a national plan targeting youthful voters.
Although the PSD remains the largest single party in
parliament, with about 34 percent of Deputies and Senators,
it has not regained the morale and focus it lost after last
fall's elections. There is no indication that the PSD will
rise reinvigorated from this week's party congress. End
Comment.


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