Tuesday, July 26, 2005

More middleman talk

This is a big part of the problem--Kyiv Weekly:

Meanwhile, Ukraine's premier has her own opinion on the subject. Yulia Tymoshenko stated that 2005 harvest grain will be exported by state traders " State Reserve Committee and JSC Khlib Ukrainy. The objective of this is to minimize involvement of intermediaries who buy grain from farmers at very low prices and sell it at world prices. "The government is not looking to pressure grain traders," added Economy Minister Serhiy Teryokhin. "We are simply creating a system that will not allow a number of major grain traders to dictate prices to producers." On this issue, Tymoshenko and Teryokhin have the same position as the Agrarian Policy minister, Socialist Party member Oleksandr Baranivskiy, who has recently had serious arguments on other issues with the two officials. SPU leader Oleksandr Moroz also insists on holding the price through the state acquisitions: "If the government does that, the grain traders will not lower the prices lower than the state. Farmers should be given an opportunity to sell grain to the state at the price they like."

I wonder how it is they think they can have any real economy and any real jobs without any middlemen, only producers and consumers. It is stunning just how much of the Soviet style there is in this. Middlemen as enemies of the state.

The real problem here is the populism of Tymoshenko. She interferes in the economy with administrative measures and that interference causes shortages but her popularity goes up because she sticks it to the Russians and the new kulaks--the middlemen. The real fear is that Yuschenko gets the blame for any downturn that happens but Tymoshenko ends up the hero of the people and head of state. If that happens any liberalization of government and the economy will, at the very least, be on hiatus.

The people will probably be all for it which is their right as bad as that might be. Reminds me of the line in the Fellowship of the Ring:

"In the place of a dark lord, you would have a queen!"

Much more pretty of course but would there be any real difference? That is the question.


Anonymous said...

I'm so glad that you are writing about this - I could not agree with you more. It saddens me that T. will soon be the recipient of even more political power. I do wonder whether this also points to a political alliance bet. T. and Moroz which could lead to Pres. Y. being deposed or being so politically blocked that it will lead to more concessions and negotiations, in order that his agenda gets completely derailed or stalled.

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