Senate Rejects Tax Hikes

The Czech Senate vetoed proposed tax increases Thursday – the second piece of major legislation it has turned down in as many days. Coming on the heels of its rejection of a church restitution bill Wednesday, the upper house voted down an increase of the value added tax (VAT) along with a proposed “solidarity tax” to be imposed upon the country’s highest earners.

Social Democrats led the resistance effort as 52 of 70 senators present voted against the tax hikes. The Christian Democrats and Communists joined ČSSD in their blockade of the legislation, while all but one of the voting members from center-right parties ODS and TOP 09 supported the reforms.

Senator Jaroslav Kubera (ODS) was the only right-winger to break party ranks. “Raising taxes in a recession is nonsense,” Kubera said.

Finance Minister and TOP 09 Deputy Chairman Miroslav Kalousek defended the austerity minded legislation as a “necessary evil”. Spending cuts account for a majority of deficit reductions in the package, he noted, while only one-third come from increased revenue.

The country’s two VAT rates would be raised by one percentage point each to 15% and 21%, respectively. A 7% tax would be levied on citizens earning a gross salary of four times the national average, about 100,000 crowns ($4,950) a month.

The proposal now returns to the Chamber of Deputies, where an absolute majority can enact the reforms despite the Senate’s rejection. While tax increases are likely to garner the necessary Chamber support, rising opposition complicates second-round passage.

Social Democrats recently found an unlikely ally in their campaign against tax increases in President Vaclav Klaus. “The increase in all taxes and VAT in particular harms our economy, hinders it. It is an unwise move,” the former ODS leader said recently.

Prime Minister and ODS Chairman Petr Nečas brushed aside Klaus’ criticism of the austerity package aimed at keeping the deficit below 3% of GDP, noting that it was easy to make such remarks without the burden of responsibility for the state budget. Nečas said that the government’s ability to put together a budget is tied to the tax increases and implied that their failure might mark the end of the ruling coalition. “The government stands or falls with it,” he said.

Senate Sends Back Church Restitution Bill

The Czech Senate rejected church restitution legislation Wednesday. The country’s upper house was long expected to vote down the proposal, aimed at compensating religious entities for property seized under Communist rule. The bill, approved by the Chamber of Deputies in July, would grant religious groups property and financial reparations valued at 135 billion Kč ($6.6 billion).

The bill will now be sent back to the House of Deputies, where it was approved in July. Prime Minister Petr Nečas (Civic Democrats, ODS) expressed confidence that the ruling center-right coalition has the 101 votes needed to override the Senate’s veto.

The proposed deal would award property worth 75 billion Kč ($3.7 billion) in an effort to atone for losses suffered by religious entities at the hands of the Communist regime. An additional 59 billion ($2.9 billion) in financial compensation would be paid to Czech churches over the next 30-years to account for property that could not be returned. The Catholic Church stands to receive the majority of reparations, while Jewish and Protestant groups would receive the remainder.

Several prior attempts to resolve the matter have failed. Most post-Communist countries have already addressed the issue of religious property seizure under Communism.

The bill’s rejection by the upper house was widely anticipated. The Social Democrats (ČSSD), who hold the largest presence in the Senate, have been the proposal’s most vocal critics.

A Contentious Public Debate

The Social Democrats have spearheaded a controversial public campaign against the legislation. Their posters and billboards show an arm, clothed in the Civic Democrats’ (ODS) blue, handing over a sack of money to another outreaching arm in a priest’s garb. Catholic leaders condemned the campaign as reminiscent of Nazi and Communist propaganda. Social Democrats responded by calling into question the role of the Catholic Church during World War II.

“ODS & TOP 09 want to donate 134 billion korun to churches”

ČSSD questions the scope of the settlement, asserting that the compensation is overstated by some 54 billion Kč ($2.7 billion) and would return more than was taken away. The left-of-center Social Democrats also express skepticism over how Churches will prove prior ownership and to what extent the churches owned the property in the first place, arguing that prior to 1948 they managed it as a public corporation. Read more

Christian Dems Seek New Name, Comeback

In 2010, Czech voters sent the Christian Democrats packing. For the first time in post-Revolution politics, the party failed to gain seats in the House of Deputies. A debate rages within its ranks over the return path to relevance. Many members claim it’s all in the name.

The party’s full name, Christian and Democratic Union – Czechoslovak People’s Party (KDU-ČSL), is rarely used in its full, hyphenated glory. “Lidovci” frequently serves a moniker for the mouthful. In an interview with Právo (link in Czech), KDU-ČSL chairman Pavel Bělobrádek said that a name change is under consideration.

Some members object to the continued presence of “Czechoslovak” in the title, nearly 20-years after the Velvet Divorce. Others, insist “Christian” has no place in the party name, citing the implications in one of the world’s least religious countries. Bělobrádek noted that only one in three supporters is a practicing Catholic.

Given that we are not just supported by Christians, we wondered if this wasn’t an anachronism.
-Lucie Kmentová, of the progressive “Yellow” wing of KDU-ČSL

At least eight new names have been proposed, according to the chairman. The party will address the issue when it convenes in December. “People’s Party”, its pre-Revolution title, is emerging as a favorite. It was scrapped largely to distance the group from its role as a puppet party and member of the “National Front”: the coalition that governed in the aftermath of World War II and saw the Communists seize control.

Primed for a Comeback?
In 2010, voters rejected the political establishment. The emergence of new parties TOP 09 and Public Affairs dealt KDU-ČSL a death blow into obscurity. The Christian Democrats hope to play the role of Lazarus in the next legislative elections.

Their fall from grace stemmed from a plunge in preference in the country’s Bohemian regions, where they saw their vote tallies halved versus the 2006 contest.

The party has always been more popular in rural areas and small towns in Moravia, the country’s eastern region. But its support became more regionally confined than ever as conservatives in Prague and surrounding areas turned out for younger parties in higher numbers. Though they lost some ground among their traditional power base, the Christian Democrats fared far more respectably in the east. The map below shows KDU-ČSL’s support by region in the 2010 contest:

For a return to Parliament, KDU-ČSL must bolster its Bohemian support. In Prague and the Central Bohemian Region that encapsulates it, the Christian Democrats averaged a mere 2.1% of the vote. Those two regions alone comprise nearly a quarter of the country’s population.

But as disgust with the ruling coalition continues to rise, the party appears to be improving its chances of once again taking its seat at the table. For the fifth straight month, it’s polling above the threshold for representation in the Chamber of Deputies

This party-to-be-named-later may play a decisive role when the next government is formed.

Czech Lurch to the Left: Part Three

Previous entries: Part One, Part Two

In 1990, more than 100,000 Czechs turned out to celebrate the overthrow of Communism with Vaclav Havel and the Rolling Stones. “The Rolling Stones roll in, Soviet tanks roll out,” posters blared. Last April, the Communist Party helped bus nearly 100,000 Czechs to Wenceslas Square to demonstrate against the ruling coalition.

Soviet tanks aren’t rolling back in, but there’s a red tide rising.

Sympathy for the Devil

Czech Communism dwindled but never disappeared after the 1989 Velvet Revolution.  KSČM, the Communist Party, has averaged 12.7% of the vote in the five legislative elections since the Czech Republic and Slovakia split. Its base is old, undereducated and loyal (see part two). Demographics alone suggest the Party will shrivel in coming decades.

Yet support for the Communist party spiked above 16% in May, June and July. Current projections call for a 40% increase over its share of the 2010 vote. Despite its post-Revolution status as a political third rail, KSČM is now positioning itself as a power broker when the next government is formed.

What’s driving its reemergence as a political force?

Can’t Get No Satisfaction

Throughout the history of Czech elections, voters have supported the Communist Party in greater numbers during times of economic pessimism.

Under the ruling, center-right coalition the Czech economy has underperformed its neighbors. The chart below compares the GDP growth rate of the Czech Republic and bordering countries over the last seven quarters: Read more

Zeman’s Summer Surge

Miloš Zeman’s summer surge has the rest of the field feeling the heat. Time will tell if the mood for Miloš is mercurial or set to stay.

The former prime minister’s political momentum swells on two fronts: party and presidential bid.

Crossing the Threshold
For the second straight month, Zeman’s Party of Civic Rights — commonly called Zemanovci — is polling just above the 5% threshold necessary for the representation in the House of Deputies, the Czech Parliament’s lower house. Founded in 2009, the fledgling left-of-center party failed to gain seats in the 2010 parliamentary elections. If it can maintain its current level of voter preference, it may be an ideal coalition partner for the Social Democrats, despite Zeman’s differences with the party he once led.

Surging into Second
The most recent surveys show Zeman surging into second place for the upcoming 2013 presidential contest, the first direct election to that post in modern Czech history; he trailed economist Jan Švejnar in all previous polls. If Czechs filed into voting booths today, Zeman would face off against favorite Jan Fischer in a runoff election. A chart of voter preference over the past five months follows:

Hitting the Ground Running
Zeman has outpaced opponents in laying the organizational framework for pursuit of the presidency. The first candidate to collect the 50,000 signatures required to appear on the ballot, he did so in just over two months. Weekend warriors journeying to their countryside cottages can’t help but notice the “Zeman to the Castle” (Zeman na hrad) billboards plastered along Czech highways. Read more

The Baseless Herding of Romani Children

Romani children have long been herded into “special” schools in the Czech Republic, drawing international attention and condemnation. A study by the British charity Equality shows that such students, supposedly incapable of normal academic achievement, have little difficulty adapting to mainstream curricula after immigrating to the United Kingdom.

The study, “From Segregation to Inclusion“, represents the first research analyzing the aptitude of Roma pupils that have emigrated from Slovakia and the Czech Republic.

From “Equality”

Equality interviewed 61 resettled Romani students, 85% of whom had been placed in special, practical or de facto segregated schools prior to emigration. Yet only 2-4% of pupils assessed were deemed to require special education needs, according to the report.

The study found little difference between the Roma children who had attended mainstream schools and those who were regarded in their former homelands as incapable of carrying out a normal course of studies. More importantly, researchers noted little to no difference between the attainment and potential of Czech and Slovak Roma children placed in special schools versus that of recently arrived non-Roma peers.

Logically, the report concluded that “the way that Roma children are currently educated in special or de facto segregated settings in the Czech Republic and Slovakia is not justified by their educational, social or cognitive abilities.”

An Overview of the Problem
Nearly a third of Romani children in the Czech Republic attend schools intended for students with “mild mental disabilities”, according to recent estimates by the Council of Europe’s Commission on Human Rights. This stands in glaring contrast to the 2% of the rest of the student population placed in such institutions.

This systemic discrimination toward Roma pupils gained exposure and notoriety following the European Court of Human Rights’ watershed ruling in D.H. and Others v. Czech Republic. The 2007 case, filed on behalf of 18 Romani students in Ostrava, highlighted the pattern of segregation pervasive in the Czech school system. According to the Court, the prejudicial effect of these practices constituted a violation of the protections against discrimination laid out in the European Convention on Human Rights. Read more

Czech Lurch to the Left: Part Two

Yesterday, in part one of our look at the Czech political landscape, we introduced the puzzling rise in Communist support in the Czech Republic. The Communist Party of Bohemia and Moravia (KSČM), widely loathed for its repressive rule prior to the Velvet Revolution*, finds itself projected to place second in the next legislative elections.

Today we’ll take a look at who still votes red in the ex-Communist Czech Republic.

Who Votes Communist These Days?

People who tend to be older, less educated and not from Prague.

1) Communist supporters are older.

As I noted yesterday more than 70% of KSČM members are at least 70-years-old. Member loyalty has been a driving force behind the continued Communist presence in the Czech legislature. Most party members have spent the majority of their adult lives under Communism. Two-thirds have been faithful to the party for more than 40-years. These older loyalists tend to be leerier of the political institutions and economic development that have replaced the decades-long Communist lead stagnation. Younger and less nostalgic left-leaning voters have gravitated to the more pragmatic Social Democrats.

2) Communist supporters are less educated.

More specifically Communist supporters are less likely to have attained secondary and tertiary degrees. They do, however, have the highest rate of vocational education among major parties and consequently are more likely to have worked as laborers. Unsurprisingly, given their educational tendencies and proclivity to work blue-collar jobs, Communist party members have a lower standard of living than voters loyal to other parties. Read more

Czech Lurch to the Left: Part One

As the new year dawned, Czech Communist Party (KSČM) leader Vojtěch Filip found himself in political hot water and potential legal trouble. His decision to offer the party’s formal condolences to North Korea for the loss of their Dear Leader, Kim Jong-Il, had evoked public outrage. Czech papers teemed with speculation as to whether or not he’d violated a statute that bans public support for totalitarian regimes. Three months later, the Czech government abandoned its pursuit of legal avenues to outlaw KSČM. Yet, Filip’s Communist Party finds itself riding a wave of increased support.

Vojtěch Filip, Communist Party Leader

A new poll from Factum Inverio (note: link in Czech) shows that 16.1% of Czechs would vote Communist if elections were held today – an increase of more than 40% over their share of the votes in the last elections to the House of Deputies, the lower house of the Czech Parliament (2010).

For the past several months, the Communist Party has been locked in a back-and-forth battle with the Civic Democrats for a second place finish in the polls.

The rise in support for KSČM started to emerge in mid-2011. Initial skepticism of the staying power of such a spike is giving way to the realization that the trend is more than a blip.

The Communist Party’s relevance in the post-communist Czech political scene is nothing new. KSČM has won over 10% of the vote in each parliamentary election since it was removed from power in 1989. It’s a (typically) quadrennial reminder that while the former regime is scowled upon by most Czech citizens, there were beneficiaries and supporters remain. But heads turn in Prague when a party viewed as dying slowly sees a sudden uptick in support.

KSČM has operated on the fringe of Czech politics throughout the post-communist era. It’s the only former ruling party in the region to have kept “Communist” in its name*. Whereas deposed regimes in some of the other former Soviet satellite states re-branded themselves as “social democrats” and embraced a more pragmatic form of leftism (see: Hungary, Poland), the Czech communists have tended toward orthodox Marxism and away from public opinion. Read more