CZECH REPUBLIC: COMMUNIST PARTY ALREADY DE FACTO

C O N F I D E N T I A L SECTION 01 OF 02 PRAGUE 000173

SIPDIS

SENSITIVE
SIPDIS

E.O. 12958: DECL: 02/17/2015
TAGS: PGOV EZ
SUBJECT: CZECH REPUBLIC: COMMUNIST PARTY ALREADY DE FACTO
JUNIOR PARTNER OF THE RULING SOCIAL DEMOCRATS?

Classified By: Acting DCM Mike Dodman for reasons 1.4 b+d


1. (SBU) SUMMARY. An increasing number of observers are
saying that, for all practical purposes, the governing
coalition in the Czech Republic no longer rules. The ruling
Social Democrats (CSSD) have turned more often to the
opposition Communists (KSCM),rather than their junior
coalition partners, the Christian Democrats (KDU-CSL) and
Freedom Union (US-DEU),to pass legislation of importance.
For the first time, both CSSD and KDU-CSL are now openly
acknowledging the effective end of the coalition partnership.
This alliance between the Social Democrats and the
Communists, who have consistently maintained a slight lead
over right-of-center parties in recent polls, provides a
preview of what the next government might look like. The main
opposition Civic Democrats (ODS) have tried to win support by
warning voters that a victory by the Social Democrats in this
June,s general elections would lead to a minority government
silently supported by the Communists. The Prime Minister has
over three months to show that a minority CSSD government,
supported chiefly, but not exclusively, by the Communists, is
not only not something to fear, but a government that
deserves support.

ACKNOWLEDGING THE OBVIOUS


2. (U) The current Czech government is a three-party
coalition of 101 seats in the 200 seat lower chamber. The
Social Democrats (CSSD) have 70 seats, the Christian
Democrats (KDU-CSL) have 21, and the Freedom Union (US-DEU)
have 10. Early last summer during the initial stages of
debate on a new, pro-union labor bill, the Christian
Democrats publicly turned against CSSD, who then turned
instead to the Communists and their 41 seats for support on
the bill. Since that time, the Communists have supported the
Social Democrats slightly more often than either of the two
official coalition partners, particularly on very visible
social and economic legislation. An excellent example of this
is the same labor bill, which was passed February 8 with near
unanimous support from CSSD and KSCM and near unanimous
opposition from KDU-CSL, US-DEU, and ODS. On the other hand,
CSSD has turned to both ODS and its junior coalition partners
to pass other important legislation, including, also on
February 8, reform of bankruptcy legislation long advocated
by the business community, and late last year on deployment
of Czech troops in Iraq and elsewhere.

3.(U) At the CSSD program conference, January 28, Jiri
Paroubek, the prime minister and the CSSD election leader,
said a minority CSSD government is the most likely
post-election arrangement. He stated that his government has
been successful precisely because it behaved right from the
start as if it were a minority government. Paroubek used his
speech to say, "Our success in the Chamber of Deputies is
given by the fact that the government, under my leadership,
has acted right from the start as a minority government.(...)
Let us ask ourselves how successful we would have been in
passing laws if we had stuck to the 101-strong majority of
the ruling coalition when negotiating support across the
Chamber of Deputies, or, in other words, if we had remained
on the basis of unproductive anti-Communism" (i.e., treating
one-fifth of the lower chamber as off limits).

4.(C) On January 29, in a debate against the Prime Minister
on one of Czech Television's Sunday afternoon political talk
shows, KDU-CSL chief Miroslav Kalousek conceded that the
three-party coalition "no longer exists." He warned that
Paroubek would have to offer the Communists program
concessions and posts in the civil service and state-run
enterprises in exchange for their support. (Comment:
Kalousek's acknowledgment of reality is in part an element of
KDU-CSL's pre-election strategy of highlighting the dangers
of bringing the KSCM closer to power. But it also fits with
previous KDU-CSL behavior as the small party has previously
tried to disassociate itself from coalition partners prior to
an election. Having been criticized in the past for
abandoning coalitions, and for bringing down the Gross
government last year, Kalousek has apparently decided to
stick it out within the coalition this time around.)

YOU GO YOUR WAY AND I'LL GO MINE


5. (C) CSSD parliamentarian Milan Ekert, in a February 2
meeting with the Embassy, also expressed the opinion that the
CSSD/KDU-CSL/US-DEU coalition no longer functions. Ekert
explained the coalition partners are going in opposite
directions. He said, &one train, with CSSD aboard is going
this way, and another train with KDU-CSL aboard is going that

PRAGUE 00000173 002 OF 002


way. They can not cooperate.8 In a separate meeting on
February 8, the Embassy asked Petr Necas, Deputy Chair and
shadow Defense Minister for the opposition Civic Democrats
(ODS) whether parliament was now ruled by CSSD in conjunction
with KSCM. "Absolutely. Without a doubt," was his reply.


6. (U) Commentator Bohumil Dolezal, warned in a January 31
editorial, that a CSSD minority government tacitly supported
by the Communists would lead to nationalization of health
care and restrictions on media independence. The next day,
Jiri Pehe, former advisor to Vaclav Havel and now an
occasional advisor to Prime Minister Paroubek, wrote a reply
in the national daily, Pravo, saying, &Every citizen may
expose himself to a simple test. Has he or she been stripped
of any of his civic rights as a consequence of the alleged
CSSD-KSCM co-governing? Does he or she feel that our
democracy is emasculated? Does he or she think that, after
the election, Paroubek will start to regulate media,
nationalize companies, or introduce a police state? The
answer to these questions is easy for most people with common
sense: No! Hence, the mobilizers' warnings are in fact
advertising future cooperation between the CSSD and the KSCM.
If we are already living in emasculated democracy, it is not
all that bad, in fact.8

7.(U) The Communist Party also had their program conference
January 28. Party Chair Vojtech Filip confirmed that KSCM is
ready to support a minority CSSD government. His predecessor,
former party chair Miloslav Grebenicek, who had always
opposed cooperation with CSSD, failed to attend the
conference. The conference's program was drafted by party
vice chair, and relative moderate, Jiri Dolejs, who has also
expressed a willingness to work with CSSD.


8. (SBU) PM Paroubek has said all along that he would never
invite the Communists into his cabinet, and almost no one
expects the June elections will produce a formal CSSD-KSCM
coalition. But most observers have been predicting that the
Prime Minister will offer them seats on lower-level state
boards, or positions at the level of Deputy Minister, in
return for their agreement to support CSSD in a vote of
confidence. ODS Deputy Necas also predicted that the
Communists would put forward the names of sympathetic
non-party members who could be considered among the "experts"
that Paroubek intends would fill one-third of the cabinet
positions in a minority government. In what is perhaps the
first sign of this, on February 2, CSSD and KSCM joined
forces to remove two ODS politicians from the Supervisory
Board of the Czech Consolidation Agency, the state-run body
that bails out failing firms. ODS Deputy Chair and shadow
finance minister Vlastimil Tlusty was ousted by a
parliamentary vote 94-43. Fifty two of the fifty three CSSD
deputies present and thirty seven of the forty KSCM deputies
present voted to remove Tlusty. The votes supporting Tlusty
came from ODS and KDU-CSL. On February 3, parliament voted to
replace the two ODS figures with KSCM parliamentarian Zuzanna
Rujbrova and CSSD parliamentarian Miroslav Svoboda. This
marks the first time that a Communist has been on the board
of supervisors of this agency.


9. (C) COMMENT: PM Paroubek continues to impress both
supporters and critics alike with his political skills. By
freeing himself from the confines of his fragile coalition
and bringing the Communists back to the table, he has made
himself the strongest and most productive of the three CSSD
prime ministers since the 2002 elections. As will be
discussed further septel, his record on issues of importance
to the United States is generally positive, but with several
notable areas of concern on both foreign policy and business
climate.


10. (C) The CSSD's main contender, ODS, has so far run a
rather uninspiring campaign; it will have to come up with
more persuasive policies and appealing candidates if it hopes
to win enough votes to form a government with the Christian
Democrats. The "red menace" strategy that both ODS and
KDU-CSL are falling back on isn't working. In fact, if the
polls are accurate, unless something quite bad happens,
voters are likely to stick with the arrangement that seems to
be winning, ushering in a formal CSSD minority government to
replace the de facto minority government that exists today.
CABANISS