LATVIA,S DYSPEPTIC DOMESTIC POLITICS

C O N F I D E N T I A L SECTION 01 OF 02 RIGA 000138

SIPDIS

NOFORN
SIPDIS

E.O. 12958: DECL: 03/24/2018
TAGS: PGOV LG
SUBJECT: LATVIA,S DYSPEPTIC DOMESTIC POLITICS


Classified By: Ambassador Charles W. Larson, Jr. Reason: 1.4 (d)


1. (C/NF) Summary: Since the relatively dramatic events of
last fall that brought down the Kalvitis government, the
Latvian domestic political scene has been full of sound and
fury but signifying little in terms of action. There is a lot
happening and much noise, but it is hard to see that any of
it is making a difference beyond the small circle of
political elite. The Godmanis government, despite having an
ambitious plan on paper, is likely to remain a low energy,
low results administration for the foreseeable future.
Despite the surrounding noise, this government could likely
stay in office into 2009 barring a major scandal or a
significant economic downturn. End summary.


2. (U) Last fall, Latvian domestic politics were alive and
vibrant. From the September/October attempts to remove
anti-corruption chief Loskutovs, through the two largest
rallies since the restoration of independence, to the
resignation of PM Kalvitis, every day seemed to bring news,
and politics was the main topic of discussion anywhere you
went. There was a sense that a change was coming to Latvian
politics -- that people were deciding that they were tired of
only being heard from at elections and that they expected a
government that did a better job of actually representing the
people.


3. (C) But this enthusiasm was short lived. Even by the time
the next government was being formed, people seemed to tune
out. President Zatlers attempted to create a process for
debate and discussion to inform his selection of the next
Prime Minister, but he made two mistakes borne of his
political inexperience that made the public feel that there
would be no real change in Latvian politics. First, he left
it to the parties to define the candidates for Prime
Minister, instead of retaining that key prerogative for
himself. Second, he very clearly telegraphed that he was
unwilling to recommend dismissal of the Saeima (which would
have required approval in a referendum) if a government to
his liking was not formed. In both of these steps he put the
powers in the hands of the political parties, especially the
four who made up the previous coalition. Zatlers tried to
force them to take in opposition New Era, but that would have
been an unwieldy coalition and by taking dismissal of the
Saeima off the table, Zatlers ceded his leverage to force
their inclusion in the coalition. The result was a new
government that looked shockingly like the old one and public
who was focused more on Christmas holidays than on politics.


4. (C) Since then, we have seen and heard a lot of noise from
the political space, but very little of it has had any real
traction with the public. The most dramatic event was the
fracturing of New Era, with four MPs, led by former FM Sandra
Kalniete, leaving the party. They were joined by former
Defense Minister and current MEP Girts Valdis Kristovskis,
who left nationalist party (and coalition member) "For
Fatherland and Freedom (TB/LNNK). Kristovskis and Kalniete
have announced plans to form a "national conservative" party
with a particular focus on "the regions" and "the next
generation." The reaction has been underwhelming with most
observers asking how the policies of the new party will
differ from the ones its founders left. Its task will be
further complicated because two of the members of Saeima who
left TB/LNNK to join this group have announced that they will
continue to support the Godmanis government. Asked how she
would square this circle, Kalniete explained to pol/econ
chief that "we are not an opposition party, but neither do we
plan to join the government at this time. We will, however,
cooperate with them when we agree with their policies."


5. (C) We have also seen movement by former FM Artis Pabriks
and former local government minister Aigars Stokenbergs, who
left the People,s Party last fall, to establish their new
party. After forming an NGO "For a Different Kind of
Politics," they have announced that they hope to establish
the party in May and that it will be "social democratic, on
the Swedish economic model" as Stokenbergs told us. He and
Pabriks have stressed support for entrepreneurs, but offered
few details. They have made news with two moves though.
First, they have stated that the party will be "of the left,"
which heretofore in Latvian politics has been code for
catering to the ethnic Russian community, and they will face
knee jerk opposition from those who hear "left" and think
"Russian." Second, they succeeded in gathering enough
signatures to start the process for a possible referendum on
ensuring that pension payments keep recipients above the
poverty level.


6. (C/NF) For all this activity in the political arena,
little has transferred to the legislative process -- an
indication that the government feels secure and the
opposition remains weak and disorganized. The weekly Saeima

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sessions since the beginning of the year have tended to be
finished in an hour or less and most legislation is adopted
without debate. The only lengthy session contained debates on
voting rights for non-citizens in local elections and
ratification on two small bilateral agreements with Russia,
proving that Russia and Russians remain the political issues
in Latvia with the greatest traction. The one piece of
legislation of any real significance passed during the winter
session of Saeima dealt with pension indexing and was a
direct result of the Stokenbergs/Pabriks initiative to hold a
referendum on the issue. But even that generated little
discussion.


7. (C/NF) So, for all the seeming activity on the political
front, why is the level of actual results so low and the
level of voter apathy and indifference so high? It seems to
us that after the burst of activity last fall, Latvians have
returned to their default position on politics -- it doesn,t
affect me and there is little I can do to change it anyway.
Politics here remains relatively immature and the continued
drops in interest and involvement are especially unhealthy in
a developing democracy. Both Kalniete and Stokenbergs have
told us they believe they can draw a significant amount of
support from the nearly forty percent of voters who sat out
the 2006 elections, but political observers here and our own
instincts tell us this is unlikely. It,s very difficult to
bring politically inactive people back into the process, even
more so when what seems to be on offer are the same people
who were on the ballot in 2006 when these voters stayed home,
except now they are arranged in different groupings. The one
established name with the ability to come in and truly shake
thing up would be former President Vike-Freiberga, but she
continues to disavow any plans to join politics (although it
is know that her husband has expressed some personal support
for Stokenbergs). Another reason that political interest
seems so low is that there is no election on the horizon.
Local elections and elections for the European parliament are
in June 2009. And even if the constitution is amended to
allow for the public to call for a referendum on dismissing
Saeima (currently only the President can do so),the
timelines are such that no new Saeima election could be held
before the end of 2008 or early in 2009.


8. (C/NF) All of this, plus the fact that the four parties in
the current coalition are best served for now by sticking
together, means that the Godmanis government can be expected
to hang in through at least the end of the year, even if it
produces little in terms of results. We can see three
scenarios that could change that. First, a brazen move
appearing to serve the oligarch over the common interest that
mobilized the public the way they attempted dismissal of
Loskutovs did last fall -- and the upcoming decision whether
to retain intelligence chief Kazocins for another 5 year term
has the potential to generate a public outcry if the
government tries to dump him. Second, a significant worsening
of the economic situation that led to bankruptcies,
widespread layoffs, and/or inflation that passes 20 percent
would likley spur the public to demand a change. Third would
be a change from within. It is widely known that the
People,s Party feels that it was unfairly forced to give up
power last fall (and Kalvitis believes he had the premiership
"taken" from him) and would like to regain the top spot and
could bring down the government from within, but would likely
wait until it thought the worst of the economic news was
behind it.


9. (U) All in all, we expect that the next few months will
see more activity and more noise in the Latvian political
sphere, but little action or change.
LARSON