Rallies and strikes are a good thing, but disturbances will not solve anything," Repse pointed out after a meeting with Latvian Free Trade Unions Association representatives today. As the finance minister explains, he realizes that "people are really concerned and desperate", however, damaging government buildings will not contribute to improving the situation in any way as repairing the buildings would have to be paid for with state budget money anyway.
I'm sure he can't have quite put it like this - if he did then a Finance Minister actually supporting strikes against his own measures would be a first, I think (what is happening in Latvia is surreal, but not this surreal, surely) - and that the question is a translation one, but still. It does illustrate the difficult position local politicians are being put in when it comes to defending the EU Commission and IMF inspired measures in the face of their own voters - as I already forecast it would be in my post The Long And Difficult Road To Wage Cuts As An Alternative To Devaluation back in January. More to the point is this, which is real enough:
Working pensioners' pensions will be slashed 70%, all other pensioners will see their pensions shrink by 10%. Also maternity and child care benefits will be cut by 10%.
Now, I know the aim is to bring prices down, but how can a country which is effectively dying for lack of children (post coming on this later) be actually cutting child allowances. Frankly I find this even harder to believe than the idea of a Finance Minister supporting strikes against his own policies. It is nevertheless true. Everything, I see, is possibile in Latvia, except, of course, devaluation.
2 comments:
Progressive income tax was a good idea... As an idea. The proposal was just awful: in case of becoming a reality this tax would reduce salaries of people earning around 1000 lats on paper for about 20% (e.g. to 590 on hand). This would automatically mean I-don't-know-which wave of younger people migration abroad. But the progressive income tax is a really good idea, maybe even a must for stable society, but not now and not in the way it was proposed.
There are some other things in the budget that are even worse. The healthcare budget is being cut by 42 mln - that's 25% of what was left after the previous cuts. I don't quite imagine how our hospitals can keep functioning after that.
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