Latvia 2011

General elections were held in Latvia on September 17, 2011. All 100 seats in Latvia’s unicameral legislature, the Saeima, were up for reelection. These 100 seats are split between five electoral districts (Riga, Vidzeme, Latgale, Zemgale, Kurzeme) which elect between 13 and 29 members through open party-list proportional representation with a 5% threshold.

These snap elections, held less than one year after the last elections in October 2010. These elections are the conclusion of a political crisis which began in May when then-President Valdis Zatlers dissolved the Saeima (a presidential prerogative which comes with significant political risks: a referendum is held confirming the dissolution, and if the referendum is defeated, the president resigns) after it had voted against removing the immunity of one of its members, Ainārs Šlesers, investigated on a number of counts of corruption. Days later, Zatlers was defeated for reelection when the members of the Saeima preferred Andris Bērziņš over Zatlers. However, on July 23 Latvian voters by a crushing margin (94%) endorsed Zatlers’ dissolution and set the stage for these snap elections. Valdis Zatlers did not let matters stay there, and turned his crusade against corruption and the oligarchs (which he claims are so prevalent in Latvian party politics) into his own political party, Zatlers Reform Party (ZRP).

In the last elections in October 2010, the centre-right Unity coalition (recently turned into a political party) led by Prime Minister Valdis Dombrovskis was reelected and formed a coalition government with the agrarian populist Union of Greens and Farmers (ZZS). The economy remains a major preoccupation for Latvians, after the country was saved from bankruptcy in 2008 only by a €7.05 billion loan from the IMF plus other loans from the EU, Nordic countries, the World Bank and the EBRD. In 2008, Latvia’s GDP receded by a full 18%. Upon taking office, Valdis Dombrovskis implemented severe austerity medicine to stabilize the banks and the deficit. He made severe budget cuts, job cuts in the public sector and major tax hikes. This year, Latvia’s GDP will grow by roughly 3% but unemployment remains very high at 17%.

The ZRP’s main raison-d’etre is Zatlers’ crusade against corruption and the oligarchs which he claim run Latvian politics. On economic issues, Zatlers’ platform is poorly developed but broadly similar to that of the governing Unity party. In his anti-oligarch crusade, he specifically targets three oligarchs: Ventspils mayor Aivars Lembergs of the ZZS; Ainārs Šlesers, the leader of the populist right-wing Latvia’s First Party/Latvian Way (LPP/LC) and former Prime Minister Andris Šķēle of the now-defunct right-wing People’s Party (TP). Zatlers has expressly refused to cooperate with either ZZS, LPP/LC or the TP and he refused to debate Aivars Lembergs. Corruption and party funding is a major issue in Latvia, and most Latvians deeply distrust the Saeima and its members which are generally viewed as being corrupt. One of the main causes for the pervasive corruption in Latvian politics and the prominent positions enjoyed by oligarchs and crooked businessmen like Lembergs and Šlesers is the lack of party subsidy legislation (the only such country in the EU). Though a recently-adopted law granting a €0.71-per-vote subsidy to all parties winning over 2% will hopefully change this, up until now the lack of party subsidies had meant that parties were bankrolled and controlled by wealthy oligarchs. The control exercised by these oligarchs on political parties has turned many of them into corrupt shells and has impeded the creation of independent, autonomous public institutions and a civil society.

Ethnic Russians accounts for 27% of the Latvian population, roughly 610,000 people. Most of them live in Riga and in the Latgale region in southeastern Latvia near the Russian and Belorussian border. Of these 610k people, it is estimated that up to 335,000 do not have Latvian citizenship and thus cannot vote in elections but can access social services. Russians made up roughly 8% of the Latvian population in 1935 but 34% in 1989. The fact that most Russians in Latvia moved to the country during the Soviet era has made their status so controversial and politically touchy. Latvians want the Russians to recognize the Soviet era as “the Soviet occupation” (which would, Russians claims, make them ‘illegal occupiers’ even today) and recognize Latvian as the sole official language. Russians claim access to full citizenship and political equality with other Latvian citizens. The main opposition party in the Saeima, the Harmony Centre (SC) does not expressly claim to be a Russian party, but it is in all effects the Russian party: its members and voters are practically all Russians, it is allegedly funded by Vladimir Putin’s United Russia party and its political positions represent the views and interests of ethnic Russians. It is led by Riga mayor Nils Ušakovs, a former journalist who has given the party a better image with some ethnic Latvians who are tempted by SC because of their disillusion with other parties. Economically, SC is quite left-wing: it supports increased social spending, pledges to negotiate the terms for reimbursing the IMF loan and would set the deficit goal at 5-6% of GDP rather than the 3% currently demanded by the EU and supported by Unity.

The other main party is the National Alliance, an alliance of the national conservative For Fatherland and Freedom/LNNK and the far-right All for Latvia!

Harmony Centre 28.37% (+2.33%) winning 31 seats (+2)
Zatlers Reform Party 20.82% (+20.82%) winning 22 seats (+22)
Unity 18.83% (-12.39%) winning 20 seats (-13)
National Alliance 13.88% (+6.21%) winning 14 seats (+6)
Union of Greens and Farmers 12.22% (-7.46%) winning 13 seats (-9)
Šlesers Reform Party-LPP/LC 2.42% (+5.23%) winning 0 seats (-25)
PCTVL 0.78% (-0.65%) winning 0 seats (nc)

If this election will be noted for one thing around the world, it is for the victory of the pro-Russian SC. It is the first time since the fall of the USSR that a pro-Russian party like SC has topped the poll in Latvia. But given how polarized Latvian politics remain around the ethnic issue, it seems as if SC may have reached its ceiling. Its vote share is almost identical to the percentage of Russians in Latvia, and SC’s victory is more the result of the split in the Latvian vote than any breakthrough by SC with ethnic Latvian voters. Yet, as the largest party, SC’s power and influence has increased. The ZRP placed second, interestingly performing best in those places where ZZS and LPP/LC had done well in 2010: a backlash against oligarchs where their parties are strongest?

The governing centre-right Unity party led by Prime Minister Valdis Dombrovskis did quite poorly. It is not a corrupt party, but lost a lot of support to the ideologically similar and trendy ZRP. Unity had a hard time dealing with the new ZRP: it lost some members to it, and was unsure whether it should oppose the ZRP or move closer to it as a potential governing partner.

The oligarch parties: ZZS and LPP/LC did poorly, but I am surprised at how strongly ZZS still managed to perform considering polling which had shown them collapsing down to only 4% support. I suppose that they managed to buy a bunch of votes, considering that they performed best in Ventspils, which is the fief of its boss, Aivars Lembergs. On the other hand, Ainārs Šlesers lost all support. He had been at the heart of the corruption probe which launched this whole political crisis, and his attempts to become the anti-Zatlers (he renamed his list the ‘Šlesers Reform Party’) and populist anti-austerity candidate (basically saying that they should spend like there’s no tomorrow) failed quite badly.

The hard part are the coalition negotiations. Given ZRP’s strong showing, a coalition of any party with ZZS is quite unlikely. SC aims to join government, which would be an historic feat for the party and Russian Latvians, but that seems a bit unlikely. Firstly, SC’s governmental participation is judged by the other parties, the EU and the US as being dangerous to Latvia’s economic recovery. Secondly, SC is unlikely to accept the main preconditions for joining government: recognizing the Soviet occupation, recognizing Latvian as the sole official language in the country and support for the economic reform agenda of the outgoing government. A coalition between SC, ZRP and Unity was mentioned often in the past but it seems like an unlikely option. The most likely option seems, again, the exclusion of SC and a three-party alliance of ZRP, Unity and the National Alliance. It would be a right-wing coalition, excluding the oligarchical ZZS but it is not known who would be Prime Minister. The ZRP’s prime ministerial candidate was apparently one Edmunds Sprudz, whose Google search reveals that he is a sailor.