Confounding the Voter: Political Corruption in Late Democratizers

Südosteuropa 61 (2013), H. 1, S. 114-145

DANIELA IVANOVA

Abstract. If elections in the new EU member states are free and fair, why do voters simply not vote the corrupt parties out? This paper goes beyond regime legacies and looks at voting patterns on the issue of political corruption in order to explain why voters in democracies vote for corrupt parties and when they stop to do so. Italy, Bulgaria and Latvia have different historical legacies, but all of them have been suffering from high perceptions of political corruption. The three countries have been formally committed to fighting corruption for over a decade, but have repeatedly seen periods of popular discontent with political corruption expressed via street protests or protest voting. In a chronological overview of anti-corruption voting, I shall look at patterns of voting for anti-corruption opportunists and reformists and try to determine whether they are part of a learning curve for both the public and politicians. An important outcome is that elections are rarely decided on corruption issues alone and that preference formation among voters about the issue of ethical politics is a complex process. In terms of what can be learnt, research shows that the public’s right to dissolve parliament mid-term and popular independent institutions such as the presidency, an anti-corruption agency or external monitoring can help resolve accountability crises. Revelations of corruption have the strongest effect when the economy is in decline. As anti-corruption reforms do not make a lasting impression in times of prosperity, an economic crisis is the best time to make a clean sweep.

Daniela Ivanova holds a BA in Social Studies, Wesleyan University and a M.Phil. in European Politics, University of Oxford.

“The very existence of widespread, persistent political corruption in a competitive electoral system constitutes a puzzle”, assert Miriam Golden and Eric Chang in a study on political corruption.1 The reason why such systemic graft is baffling is because even according to minimalist theories of democratic competition, politicians have an interest in being honest so that the voting public

1 Miriam A. Golden / Eric C. C. Chang, Competitive Corruption: Factional Conflict and Political Malfeasance in Post-War Italian Christian Democracy, World Politics 53 (2001), no. 4, 588-622, 588, available at . All cited internet sources were last accessed on 12 March 2013. Political Corruption in Late Democratizers 115 does not elect their opponents.2 While electoral uncertainty inspires discipline in political parties, the lack of elections inspires corruption. However, for a long time statistical analyses concluded that non-democratic regimes were often less corrupt than young democracies. In 2002 Montinola and Jackman used data from 1980-1983 and 1988-1992 to demonstrate a non-linear relationship between corruption and democratization – there was less corruption in some dictatorships than in states with intermediate levels of political competition, i.e. unstable democracies.3 Using data from 1996-2003, Rock confirms this finding, but demonstrates that it takes a relatively short period of time before the practice of democracy begins to reduce corruption – somewhere between 4 and 15 years since the inception of the democratic regime.4 Rock’s analysis confirms that democratic competition has an anti-corruption effect, but it might take a while to have an impact. What is the explanation for this time-lag? In other words, why do voters vote for corrupt parties in young democracies and when do they stop to do so? This research question presumes that the incidence of corruption committed by elected politicians cannot be explained using traditional approaches. Political- economic explanations such as a large public sector or incomplete structural reforms run into methodological hurdles.5 Firstly, some of the least corrupt countries have large public sectors. Secondly, it is not clear whether incomplete reforms create conditions for corruption or corruption causes reforms to stall in the first place. Another set of explanations treatselected politicians as principals and state officials as their agents, hence corruption is caused by poorly designed monitoring systems for officials.6 In the same way, the inadequacy of checks and balances such as criminal legislation, judicial autonomy, a free press, civil society, and functioning law enforcement are said to prevent the public from monitoring politicians.7 Yet again, one runs into a causation issue: did corrupt politicians capture the checks and balances or did the latter simply malfunction? Finally, cultural explanations refer to legacies that make the existence of disin-

2 See Joseph Schumpeter, Capitalism, Socialism and Democracy. London 2003, 269-284. 3 Gabriella Montinola / Robert W. Jackman, Sources of Corruption: A Cross-Country Study, British Journal of Political Science 32 (2002), no. 1, 147-170. 4 Michael T. Rock, Corruption and Democracy. New York 2007 (DESA Working Paper No. 55, August 2007), available at . 5 Vito Tanzi, Corruption Around the World: Causes, Consequences, Scope, and Cures. Washington/DC 1998 (IMF Working Paper 98/63, May 1998), available at ; George T. Abed / Hamid R. Davoodi, Corruption, Structural Reforms, and Economic Performance in the Transition Economies. Washington/ DC 2000 (IMF Working Paper 00/132, July 2000), available at . 6 Susan Rose-Ackerman, Corruption: A Study in Political Economy. New York 1978. 7 Eadem, Corruption and Government: Causes, Consequences, and Reform. Cambridge 1999. 116 Daniela Ivanova terested institutions impossible.8 However, Schleiter and Voznaya object that even in the context of widespread clientelism, e.g. in Latin America and Africa, respondents in popular surveys hold politicians accountable for malfeasance by public officials, i.e. the principle of democratic accountability holds even in less institutionalized contexts.9 Cultural explanations also have a causality problem. Various studies depict a causal chain that starts with political corruption and spreads to everyday norms, rather than vice versa. Corruption generates more corruption either by decreasing returns from honest behaviour or by presenting itself as ordinary citizens’ only means of protest against a predatory system.10 Even if people consider petty bribery to be part of survival and a cultural norm, it is hard to imagine that they endorse political corruption to the same extent. Hence this author will adopt a Principal-Agent definition of political corruption: corruption is an agency problem that voters face when the politicians they elected deviate from the public’s interest in clean government. In line with Schleiter and Voznaya, I will avoid making a distinction between political and bureaucratic corruption because politicians are ultimately responsible for reigning in bureaucracies, designing disinterested institutions and propagating ethical behaviour.11 However, I shall explicitly adopt an electoral view of corruption and will use the term “political corruption” to distinguish my approach.

Literature Review

There is scant literature on corruption as an electoral issue. Most studies on political corruption in democracies take an institutional perspective and do not question voter preferences.12 These works focus on institutional features such as

8 See for example Guillermo O’Donnell, Illusions About Consolidation, in: Larry Dia- mond et al. (eds.), Consolidating the Third Wave Democracies. Baltimore/MD 1997, 40-57, 46f.; Letitia Lawson, The Politics of Anti-Corruption Reform in Africa, Journal of Modern African Studies 47 (2009), no. 1, 73-100, 76. 9 Petra Schleiter / Alisa M. Voznaya, Party System Competitiveness and Corruption. Oxford 2011 (University of Oxford, DPIR Working Paper 11-01), 5, available at . 10 See Alina Mungiu-Pippidi, Corruption: Diagnosis and Treatment, Journal of Democracy 17 (2006), no. 3, 86-99, 90; Luigi Manzetti / Charles Blake, Market Reforms and Corruption in Latin America. New Means for Old Ways, Review of International Political Economy 3 (1997), no. 4, 662-697, 669; Donatella Della Porta, Political Parties and Corruption. Ten Hypotheses on Five Vicious Circles, Crime, Law and Social Change 42 (2004), no. 1, 35-60, 56. 11 Schleiter / Voznaya, Party System Competitiveness and Corruption (above fn. 9), 5. 12 John Gerring / Strom Thacker, Political Institutions and Corruption: The Role of Unitar- ism and Parliamentarism, British Journal of Political Science 34 (2004), no. 2, 295-330, available at ; Daniel Treisman, Decentraliza- tion and the Quality of Government. Los Angeles/CA 2000 (UCLA, Department of Political Science, Preliminary Draft, 20.11.2000), available at ; Jana Kunicová / Susan Rose-Ackerman, Electoral Rules Political Corruption in Late Democratizers 117 presidentialism, federalism, electoral rules and electoral district magnitude, but yield inconclusive and often contradictory results.13 Another group of authors look at party systems and how they shape voter choices: poor information and the lack of credible challengers prevent voters from identifying and coordinat- ing against corrupt politicians.14 In a cross-country empirical study, Djankov et al. find that government control of the broadcast media is associated with poor government outcomes.15 Bes- ley and Prat find that media capture reduces political turnover by preventing voters from being informed about corruption.16 Schleiter and Voznaya show that information and effective choice are determined by the competitiveness of party systems in two ways: party system fragmentation affects corruption in a non-linear way (corruption is widespread with both few and with too many parties) and dominant parties create corrupt systems.17 Others argue that political systems such as coalitions, one-party systems and cartels between government and opposition parties are inherently secretive and do not give voters a real choice.18 One emerges from this literature with the idea that well-intentioned voters are captive to captured democratic systems. A different set of literature examines the interaction between attitudes to corruption and the political process. Davis et al. demonstrate that in societies with deep ideological divides, government corruption primarily affects opposi-

and Constitutional Structures as Constraints on Corruption, British Journal of Political Science 35 (2005), no. 4, 573-606; Eric C. C. Chang / Miriam A. Golden, Electoral Systems, District Magnitude and Corruption, British Journal of Political Science 37 (2007), no. 1, 115-137. 13 Daniel Treisman, What Have We Learned About the Causes of Corruption from Ten Years of Cross-National Empirical Research?, Annual Review of Political Science 10 (2007), 211-244, 232. 14 James D. Fearon, Electoral Accountability and the Control of Politicians: Selecting Good Types versus Sanctioning Poor Governance, in: Adam Przeworski / Bernard Manin / Susan C. Stokes (eds.), Democracy, Accountability, and Representation. Cambridge 1999, 55-97; John Ferejohn, Accountability and Authority: Toward a Theory of Political Accountability, in: Przeworski / Manin / Stokes (eds.), Democracy, Accountability, and Representation (this fn.), 131-153; John Ferejohn, Incumbent Performance and Electoral Control, Public Choice 50 (1986), no. 1, 5-25; Roger Myerson, Effectiveness of Electoral Systems for Reducing Government Corruption: A Game-Theoretic Analysis, Games and Economic Behavior 5 (1993), no. 1, 118-132. 15 Simeon Djankov et al., Who Owns the Media?, Journal of Law and Economics 46 (2003), no. 2, 341-382, available at . 16 Timothy Besley / Andrea Prat, Handcuffs for the Grabbing Hand? Media Capture and Government Accountability, The American Economic Review 96 (2006), no. 3, 720-736, available at . 17 Schleiter / Voznaya, Party System Competitiveness and Corruption (above fn. 9), 12. 18 See Kenneth F. Greene, Why Dominant Parties Lose. Mexico’s Democratization in Com- parative Perspective. New York 2007, 40; David Hine, Political Corruption in Italy, in: Walter Little / Eduardo Posada-Carbo (eds.), Political Corruption in Europe and Latin America. New York 1996, 137-157, 141; Margit Tavits, Clarity of Responsibility and Corruption, American Journal of Political Science 51 (2007), no. 1, 218-229, 22. 118 Daniela Ivanova tion activists.19 Evidence from the US, Japan and Italy shows that in polarized societies, allegations of corruption are perceived in a partisan way and hardly affect the re-election chances of the implicated politicians.20 In less ideologically polarized settings in Latin America, Davis et al. find that those voters who are most concerned about corruption become alienated and abstain from voting.21 Fieschi and Heywood investigate the phenomenon of alienation produced by corruption scandals in West European countries and conclude that it can produce different electoral results. While some alienated voters abstain, others lend their support to traditional populist parties, and a third group, which they call “cynics”, are drawn to a novel type of “entrepreneurial populism”.22 “Entrepreneurial populists” offer a clientelist alternative, where voters will also be able to benefit from the corrupt system.23 This type of populism emerges from voter disenchantment with corruption, but instead of a clean alternative, it offers a pragmatic alternative usually communicated by a highly successful and charismatic political outsider. Although Fieschi and Heywood’s observation of “entrepreneurial populism” is limited to Italy, its characteristics are shared by what Pop-Eleches refers to as “new/centrist-populism” in Central and Eastern Europe (CEE).24 “New/ centrist-populist parties” serve as vehicles for the political ambitions of a charismatic leader, and “promise weary electorates they will square the transition circle by pursuing Western integration and punishing mainstream elites widely associated with declining living standards and rampant corruption”.25 For Pop- Eleches, the rise of “new/centrist-populist” as well as radical left-and right-wing parties in the 2000s in CEE is a result of voters’ disappointment with incompe- tent and/or corrupt mainstream parties and their desire to punish them at the polls. While protest voting is motivated by the poor economic performance of the incumbent government, the economic platforms of the parties disgruntled voters actually vote for are weakly correlated with hardship and economic

19 Charles L. Davis / Roderic Ai Camp / Kenneth M. Coleman, The Influence of Party Sys- tems on Citizens’ Perceptions and Electoral Response in Latin America, Comparative Political Studies 37 (2004), no. 6, 677-703, 689. 20 Eric C. C. Chang / Miriam A. Golden / Seth J. Hill, Legislative Malfeasance and Political Accountability, World Politics 62 (2010), no. 2, 177-220, 214. 21 Davis / Ai Camp / Coleman, The Influence of Party Systems (above fn. 19), 696; Alberto Chong et al., Looking Beyond the Incumbent. The Effects of Exposing Corruption on Electoral Outcomes. London 2012 (CEPR Discussion Paper 8790, January 2012). 22 Catherine Fieschi / Paul Heywood, Trust, Cynicism and Populist Anti-Politics, Journal of Political Ideologies 9 (2004), no. 3, 289-309, available at . 23 Ibid., 292f. 24 Grigore Pop-Eleches, Throwing Out the Bums: Protest Voting and Unorthodox Parties After Communism, World Politics 62 (2010), no. 2, 221-260, 232. 25 Ibid., 232. Political Corruption in Late Democratizers 119 expectations. In other words, populists do not win because of their economic programs. In an experiment conducted in Bulgaria, Pop-Eleches finds that a party can win an election with a vague platform as long as it is pro-European and anti-corruption.26 In the unusual electoral context of CEE, correlations between political platforms and electoral cleavages are hard to distinguish. In an earlier paper on anti-incumbent voting, Fidrmuc finds that the major electoral cleavage in CEE is that between winners and losers of the transition: private entrepreneurs, urban residents, white-collar workers and highly educated voters tend to vote for pro-reform parties, while the unemployed, retirees, blue-collar workers and rural residents tend to vote against reforms.27 This divide has been ac- companied by falling turnout rates due to disillusionment with the economy and with corruption.28 However, Pacek et al. do not find convincing evidence for systematic abstention (or mobilization) due to disenchantment.29 They find a more convincing correlation between what is at stake in a given election and the level of turnout, e.g. parliamentary versus presidential elections, and elections prior to EU negotiations versus elections under EU conditionality. Still, anecdotal evidence suggests that abstention is more prevalent among one particular group – educated urban residents, while the losers of the transition mobilize to secure clientelist gains. If, as found by Davis et al., those most concerned about corruption in a corrupt political system (i.e. the reformist camp) tend to withdraw from politics, then the clientelist electorate will usually have the upper hand in elections, be the stakes low or high. As to the eventual impact of anti-corruption populists, the evidence is scarce. Many “new/centrist-populist” parties have campaigned overwhelmingly on the corruption issue, but have achieved mixed results.30 As Bågenholm shows, anti-corruption parties in government, many of which are also in Pop-Eleches’ centrist-populist category, are often subject to the same anti-incumbency bias that mainstream parties suffered before them. They often do not last in sub-

26 Ibid., 254. 27 Jan Fidrmuc, Economics of Voting in Post-communist Countries, Electoral Studies 19 (2000), no. 2/3, 199-217, 211f., available at . 28 David S. Mason, Fairness Matters: Equity and the ransitionT to Democracy. World Policy Journal 20 (2003/04), no. 4, 48-56, 48, available at . 29 Alexander C. Pacek / Grigore Pop-Eleches / Joshua A. Tucker, Disenchanted or Discern- ing: Voter Turnout in Post-communist Countries, The Journal of Politics 71 (2009), no. 2, 473- 491, available at . 30 Andreas Bågenholm, Do Anti-Corruption Parties Matter? The Electoral Fate and Policy Impact of the Third Wave of Niche Parties in Central and Eastern Europe. Göteborg 2012 (Uni- versity of Gothenburg, Quality of Government Institute (QoG), Working Paper Series 2011:22, March 2012), available at . 120 Daniela Ivanova sequent elections and if they do, they tend to rebrand themselves. Even so, Bågenholm highlights cases where anti-corruption parties in government were able to improve a country’s corruption scores: NMSII in early 2000s Bulgaria, Res Publica in Estonia, New Era in Latvia and PiS in Poland are such cases. Why these parties fared better than, for example, Slovakia’s anti-corruption crusad- ers, remains an unanswered question in the published research. I intend to revisit the phenomena of misinformation, partisanship, cynicism, anti-incumbency bias and anti-corruption populism in order to present a more complete picture of how voters in corrupt democracies vote on the corruption issue and why it takes young democracies a long time to reduce their levels of political corruption. For this purpose, the approach of this study is twofold: testing the various explanations as to why voters might vote for a corrupt party on the one hand, and examining how anti-corruption voting in one election can affect subsequent elections on the other. I shall not use statistical methods due to data limitations in terms of longitudinal voter preferences, inadequate corruption measures and a dearth of corruption lawsuits in low-accountability settings. Instead, this study will rely on a rich database of secondary sources: domestic and international monitoring reports, political analyses and secondary research. Acknowledging the limitations of these sources, I will develop a longitudinal analysis that will attempt an evaluation of existing explanations for pro- or anti- corruption voting (Hypotheses 1-4). At the same time, this study will investigate the role of anti-corruption electoral politics for the long-term development of the party system (Hypothesis 5).

Theoretical Approach

Hypothesis 1: Voters will prefer corrupt parties, if information about their ethical records is unavailable.

As suggested by the institutionalist literature, voters might face a lack of information about the corruption records of different parties or a lack of viable clean alternatives during elections. Whereas Schleiter and Voznaya theoreti- cally link these concepts to party-system competitiveness, a concept that is easily operationalized with existing measures, this study will look at the issues of information and adequate choice in qualitative terms. Evidence of media capture, media parallelism or systematic voter preferences for some types of media over others, e.g. public or private, print or electronic, will be examined as factors determining access to information. Whether voters actively seek and use political information in a discerning manner is also an important question, but one that is harder to gauge and investigate using this study’s database. This factor will be examined where adequate evidence exists. Political Corruption in Late Democratizers 121

Hypothesis 2: Voters will vote for corrupt parties, if there are no meaningful alternatives.

The second institutional concept, meaningful choice between political alternatives, is also conceptually challenging. In many cases, the Opposition is too fragmented and internally divided to offer a viable alternative. Even if opposition parties rally around the corruption issue, it might be hard to distinguish corrupt from clean alternatives. “Clean” parties might be too weak to campaign or govern on their own, which can reduce their impact. Coalition partners in the incumbent government tend to shift the blame for corruption scandals to each other, which also makes adequate choice harder. In addition, the incumbent government might be able to prevent effective voter coordina- tion between the opposition and its electorate by influencing communications or electoral resources. Due to the complexity of the concept, it might not lend itself easily to systematic investigation, but its significance will be considered where evidence exists.

Hypothesis 3: Voters will vote for corrupt parties as long as they are effective in defending their particular interests.

Both partisan and ethnic divides have been associated with voter myopia. Vot- ers might not only find it hard to believe in allegations of corruption against their preferred party, they might also choose to disregard them if the party is able to defend other vital interests of theirs – ideological, economic or ethnic. The concept of partisanship in modern democracy is problematic, because studies of both Western and Eastern Europe point to declining partisanship as one of the factors behind rising political corruption and disillusionment with democratic institutions. For Fieschi and Heywood, technocratic ability has replaced ideological competition in Western Europe. According to Pop-Eleches, the oppressive legacy of one-party rule and the policy consensus generated by popular desire to join the EU has blurred ideological distinctions in CEE.31 At the same time, anecdotal evidence from Italy and some CEE states with large ethnic minorities suggests that partisan divides are still able to deflect attention from the corruption issue.

31 Fieschi / Heywood, Trust, Cynicism and Populist Anti-Politics (above fn. 22), 296; Pop- Eleches, Throwing out the Bums (above fn. 24), 235f. 122 Daniela Ivanova

Hypothesis 4: The type of anti-corruption party that voters will prefer in a given election (reformers or opportunists) will depend on the voter’s socio-economic background.

The way the corruption issue is combined with other electoral issues might have an effect on voter preferences. If, as Pop-Eleches and Bågenholm assume, discourse on corruption is not diversified, then the identity of its leader becomes the only signal to voters of the true intentions of a party: honest technocrats are often pitched against pragmatic businessmen.32 Technocrats tend to favour anti- corruption reforms, liberal economic policies and austerity measures in times of crisis, while pragmatic entrepreneurs like to use anti-corruption instrumentally while trying to keep everyone happy, often using tax breaks and handouts to potential clienteles. Technocrats are less likely to employ anti-EU, anti-capitalist or anti-immigration rhetoric, while entrepreneurs do not have such inhibitions. Technocrats are reformers, while entrepreneurs are opportunists. In highly un- equal winner-loser contexts like that of CEE, it is likely that educated urban voters will prefer anti-corruption parties of the reformer type, while disadvantaged and low-income groups would tend to vote for anti-corruption parties of the opportunist type, if not for mainstream clientelist parties. This distinction will matter in contexts with multiple populist alternatives and in recurrent elections. If educated voters decide to abstain, opportunists will gain the upper hand, furthering clientelist policies and pursuing piecemeal anti-corruption measures as a reputational strategy. Election surveys are rarely detailed enough to allow for such an investigation, but conclusions will be drawn where information exists and results will be qualified accordingly.

Hypothesis 5: The type of anti-corruption populism that eventually prevails will ultimately depend on the economic performance of reformers and on the ability of opportunists to maintain their clienteles.

Finally, whether one type of anti-corruption agenda prevails over the other and what impact they will have will depend on long-term developments. Demand for anti-corruption parties and the supply thereof are likely to vary between elections. This study departs from a point where corruption scandals have discredited many mainstream parties and caused newcomers to offer alternatives, promising prosperity for all and punishment for the corrupt. Both reformists and opportunists are likely to thrive in this environment, but their conduct in government will impact future elections. If governing in coalition, they are likely to suffer equal blame for bad economic outcomes. Internal disagreements and

32 An example is offered by Italy’s recent experience with PM Mario Monti and former PM Silvio Berlusconi. Political Corruption in Late Democratizers 123 poor governance outcomes might undermine the cause of reformers as their electorates are more sensitive, while the clienteles of opportunistic parties might be less affected. If governing alone, their economic and ethical record will impact not only their re-election chances, but their brand of anti-corruption politics in general. If they are successful, new populists might have a chance to consolidate their positions and become the new mainstream. But times of economic hardship can backfire on reformers imposing liberal economic policies as well as on extravagant opportunists who cannot satisfy their clienteles. Voters might swing between the different types of populism or abandon the political brand altogether in favour of the old mainstream. In order to test these hypotheses, I have selected countries from the pool that has already been covered in the literature: highly corrupt EU member states with proportional (or mixed) parliamentary political systems. Although some evidence regarding electoral behaviour vis-à-vis corruption issues comes from Latin America, the task of examining voter preferences and the formation of new parties in presidential systems is too complex for the scope of this study. As for corrupt democracies in Africa and Asia, the instability of democratic regimes and low economic development makes it hard to isolate the variables this study is interested in from other major factors such as conflict, dominant parties, development issues, unfair elections and electoral fraud. Although not a young democracy, Italy features a lot of the independent variables of this study. It has high corruption levels, a deep partisan divide, and suffered economic hardship and large-scale corruption scandals in the early 1990s that discredited mainstream parties. A new highly successful opportunist force personified by media and construction tycoon Silvio Berlusconi benefited from these circumstances and won three mandates in close competition with the mainstream left until economic mismanagement and sex scandals resulted in Berlusconi’s downfall in 2011. He was then replaced by the technocrat Mario Monti. Of the other Southern European states, Spain and Portugal do not display the same high level of corruption as Italy, and neither they nor Greece experienced anti-corruption campaigns comparable to Italy’s. Starting in 1992, Italy was shaken by a chain reaction of corruption revelations that came to be called the “Clean Hands” campaign. By the end of 1993, one third of all MPs and four former prime ministers had been charged with corruption and a major trial was being shown on prime-time TV.33 The 1994 parliamentary elections returned a new house led by a political outsider. Only 12 % of MPs had served in more than three legislatures and 71 % were elected for the first time (compared to

33 David Nelken, The Judges and Political Corruption in Italy, Journal of Law and Society 23 (1996), no. 1, 95-112, 109. 124 Daniela Ivanova

44 % in 1992).34 Italy’s mainstream parties all but disappeared from the political landscape. Among the CEE states covered by Pop-Eleches and Bågenholm, several countries emerge with a rich history of new populist parties that have won elections in the aftermath of corruption scandals and economic crises: Bulgaria, Estonia, Latvia, Poland and Slovakia. In Lithuania, Romania and Hungary anti- corruption parties have not had much success, while in Slovenia and the Czech Republic their history in government is too recent to be analysed here.35 Out of the five countries with significant anti-corruption politics, Estonia has never suffered from high degrees of corruption, while Poland’s anti-corruption politics has been dominated by one party, the PiS, which had a short tenure in government. Slovakia has seen two anti-corruption parties (ANO and SMER) either becoming mired in scandals or dropping their anti-corruption rhetoric. Bulgaria and Latvia exhibit a more persistent political scene of anti-corruption parties, with a greater variety of anti-corruption populists and some stark voter divides. In Bulgaria the new populist NMSII, headed by Bulgaria’s exiled king Simeon II (hence the party’s name, National Movement Simeon II), won a surprising victory in the 2001 elections shortly after it was founded, and governed in coalition for the next eight years. In 2009 another anti-corruption populist party, this time founded by a figure with a law enforcement background, won a resounding victory and went on to form a minority government dedicated to putting criminals and corrupt politicians behind bars. The background of Latvia’s anti-corruption leaders is more traditional. In 2002 Einars Repse, a former central banker, founded an anti-corruption party of the reformist type, while a number of entrepreneurs affiliated themselves with opportunistic parties catering towards niche electorates: conservatives (People’s Party), farmers (Union of Greens and Farmers) or religious Latvians (Latvia’s First Party), while maintaining a wider “pragmatic” appeal. Repse’s party, New Era, governed in coalition between 2002 and 2006, with an intermission of nine months in 2004, and again from 2009 onwards, merging into the liberal clean-hands alliance, Unity, in 2010. The 2011 elections decisively eliminated entrepreneurial populist parties from the Latvian parliament. Bulgaria and Latvia also represent unique party systems. Bulgaria has a substantial core electorate on the left (the losers of the transition) and an ethnic- voting core of about one tenth of the population, which supports the ethnic Turkish Movement for Rights and Freedoms (MRF). Latvia has a substantial ethnic Russian minority, which comprises roughly one third of its population and mainly votes for left-wing Russian-oriented parties that do very well in elec-

34 Donatella Della Porta / Alberto Vanucci, Corruption and Anti-Corruption. The Defeat of “Clean Hands” in Italy, West European Politics 30 (2007), no. 4, 830-853, 837. 35 See Bågenholm, Do Anti-Corruption Parties Matter? (above fn. 30). Political Corruption in Late Democratizers 125 tions, but are never invited to form a government. The two countries also differ in their wider politico-economic circumstances. Latvia joined the EU in 2004, while Bulgaria had to wait until 2007 and even after that continues to be subject to monitoring related to judicial reform and law enforcement. In 2008 Bulgaria suffered an unprecedented EU sanction for corruption, while Latvia narrowly avoided bankruptcy by negotiating an IMF bail-out in the same year. These events rocked domestic politics and led to a generation of new parties as well as a big change in voter preferences. Escalating in 2011, Italy’s sovereign debt troubles also had a profound impact on voters and on the political landscape. Spotting common patterns in the demand for and the supply of anti-corruption parties in these countries’ politics is a challenge, given their differences in democratic age, regime legacies, the varying conditions of checks and balances such as the judiciary and law enforcement, and the varying extent of structural reforms in their economies. However, their European heritage, the similarity of their political systems, their advanced economic development36 and the fact that an anti-corruption discourse has been prominent during and between elections suggests that political corruption in these countries can be safely examined in terms of voting patterns rather than other factors such as regime instability, unfair elections, a state-run economy, ethnic strife, a dominant party or a dominant presidential apparatus.

Analysis

In the three countries examined in this study, the issue of anti-corruption was brought to the political agenda amid corruption revelations and economic crisis. In Italy the “Clean Hands” campaign coincided with a period of economic recession. Italian economic growth in the 1980s had been fuelled by fiscal defi- cits that weighed heavily on the economy and on Italy’s chances of meeting the Maastricht criteria for forming a European currency union by 1999. In response, a technocratic caretaker government, led by former treasury minister Giuliano Amato, passed Italy’s most austere post-war budget, began selling Italy’s massive state-owned holding companies and devalued the lira.37 Public pressure forced the government to abandon an attempt to pass what would have been in effect an amnesty for corrupt politicians.38 To conciliate the public, the electoral

36 Nevertheless, Bulgaria and Latvia, together with Romania, have the highest relative poverty rate in the EU. Although not the subject of this study, an investigation into whether poverty spurs the development of populism and if so, under what conditions, is a useful avenue of research. 37 Richard H. K. Vietor, Italy’s Economic Half-Miracle, strategy + business (01.04.2001), no. 22, available at . 38 Della Porta / Vanucci, Corruption and Anti-Corruption (above fn. 34), 836. 126 Daniela Ivanova system was changed from proportional to mixed with a heavy majoritarian element39 and deputies’ immunity from prosecution was lifted. In Latvia a banking crisis that started in 1994 fed into conspiracy theories surrounding the then governing party, Latvia’s Way. This party had been founded by Club 21, an elite grouping of liberal-minded politicians, businessmen and members of the intelligentsia.40 The 1995 elections returned a fragmented house and a governing coalition that could not agree on a leader. Eventually, they brought in Andris Šķēle, a successful non-partisan entrepreneur, who backed much needed austerity measures,41 got a conflict of interest law approved and sought advice from the World Bank on how to fight corruption.42 In Bulgaria the democratic right won a resounding victory in 1997 in the aftermath of a banking crisis that had escalated into a food crisis the previous winter. The Union of Democratic Forces (UDF) helped organize the mass protests that brought its predecessor down and presented itself as a liberal alternative to the left and its business clienteles that were blamed for the crisis.43 While in Italy and Latvia anti-corruption measures were led by mainstream incumbent parties headed by a non-partisan technocrat or entrepreneur, in Bulgaria corruption charges led to an electoral victory for the traditional right. What followed next were attempts to manipulate the anti-corruption agenda to the benefit of opportunists and mainstream parties. Regardless of Amato’s reconciliation attempts in 1994, Berlusconi’s Forza Italia, founded only a few months earlier, won the Italian elections with promises of “new politics” and “one million jobs” and formed a coalition with the extrem- ist Northern League (Lega Nord), which had captured much of the protest vote. Ironically, before the year’s end, Berlusconi and his brother Paolo had been charged with corruption in connection with their private businesses. Berlusconi denounced the indictments as a “conspiracy of red judges”.44 Berlusconi lost his

39 This happened in order to combat factionalism and intra-party competition for funding, see Miriam A. Golden, Electoral Connections. The Effects of the Personal Vote on Political Patronage, Bureaucracy and Legislation in Postwar Italy, British Journal of Political Science 33 (2003), no. 2, 189-212, available at . 40 Juris Dreifelds, Latvia in Transition. Cambridge 1997, 88. 41 Latvia: Andris, Meet Andris, The Economist, 11.05.2000, available at . 42 Open Society Institute, Corruption and Anti-Corruption Policy in Latvia. [Budapest, New York] 2002, 292, available at . 43 Venelin Ganev, Preying on the State. The Transformation of Bulgaria After 1989. Ithaca/ NY 2007, 139. 44 Della Porta / Vanucci, Corruption and Anti-Corruption (above fn. 34), 839. Political Corruption in Late Democratizers 127 coalition partners’ confidence, but he managed to thwart the ambitious agenda of his technocratic successor Lamberto Dini from the opposition benches.45 In Latvia the daily Diena revealed in 1997 that PM Šķēle and half of his cabinet had violated the Conflict of Interest Law.46 This, in addition to disagreement over large privatization deals, led to the break-up of the governing coalition. Latvia’s subsequent coalitions manifested a habit of shifting the blame for scandals, while defending particular interests. In 2001 the scandal surrounding the privatization of the Latvian Shipping Company confirmed this diagnosis: members of different coalition parties first levelled corruption allegations at each other and then denied everything later, accusing the NGO monitoring the deal of having engineered the allegations.47 In Bulgaria it was the leftist opposition that hijacked the corruption issue. The right-wing UDF government cracked down on a major industrial cartel, limited the scope of organized crime (disguised as insurance companies), and began negotiations for EU membership,48 but fiercely denied the existence of corruption within its ranks in the face of noisy accusations by the opposition49 and an aggressive media campaign.50 Thus, the anti-corruption agenda was quickly transformed into anti-corruption politicking by opportunistic figures in Italy nda Latvia or by the mainstream opposition in Bulgaria. The demand for anti-corruption reforms caused an influx of anti-corruption parties. Some of them had serious reformist intentions, but they faced consider- able challenges from opportunistic and mainstream parties. In the 1996 Italian elections, the left capitalised on the loss of reputation by the new right after Berlusconi had been charged with corruption. The victorious coalition of mainstream and reformed leftist parties headed by Romano Prodi, a technocrat with a Christian Democrat past, established two commissions to produce reform proposals on fighting corruption in the public administration

45 John Tagliabue, Italy Coalition Moves Closer to Elections, New York Times, 11.01.1996, available at . 46 Alexandru Rusu, A Diagnosis of Corruption in Latvia (ERCAS Working Paper No. 9, September 2010), 19, available at . 47 Ilze Arklina, Shipping Company’s State Trustee Loses Job Over Accusations of Bribery, The Baltic Times, 01.02.2001, available at . 48 Timothy Frye, Building States and Markets After Communism. The Perils of Polarized Democracy. New York 2010, 206-208. 49 [Profile:] Kostov, Ivan, Omda.bg, 29.02.2012, available at . 50 Center for the Study of Democracy (CSD), “Clean Future” Public Awareness Campaign. Sofia 2001 (Coalition Building and Monitoring in Transition Countries, 3), 16, available at . 128 Daniela Ivanova and in areas such as lobbying, party finances, corporate governance and public procurement. However, only a few of these proposals became laws before Prodi was forced to step down in 1998.51 By the late 1990s, an informal agreement had emerged among politicians of all colours to de-emphasize the issue of corruption. In the words of Prodi’s successor, Massimo D’Alema, “Clean Hands only unravelled what everybody already knew”.52 Under D’Alema, a bi-cameral commission outlined a constitutional reform restricting judicial autonomy, which was thought to have enabled “Clean Hands”.53 In the 2002 Latvian elections three major anti-corruption populist parties emerged victorious: former PM Šķēle’s People’s Party, former Central Banker Einars Repse’s New Era and businessman Ainars Šlesers’ Latvia’s First Party. Initially, the coalition led by Repse made tangible progress on fighting corruption: KNAB, an anti-corruption agency, was operational by the end of 2002 and charged with monitoring party finance; a judicial reform was under way; and a revised conflict of interest law was adopted.54 However, in 2003, protesting against what they called Repse’s “authoritarian manner”, MPs voted down his candidate for the Director of KNAB and refused to lift the immunity of an MP charged by the anti-corruption agency.55 Parliamentary obstruction grew fierce in 2004, when Repse’s coalition partner, Latvia’s First Party, blocked a new party finance bill. Repse had to resign, but the public outcry and the support of the president ensured the adoption of the party finance bill.56 In 2001 the party formed by and named after Bulgaria’s exiled king, the National Movement Simeon II (NMSII), was one seat short of a parliamentarian majority and formed a coalition government with the ethnic Turkish Movement for Rights and Freedoms (MRF).57 The government of Simeon Saxe-Coburg-Gotha (SCG) performed well on the macroeconomic front, earned international praise, made some inroads in the fight against administrative corruption by overhaul-

51 Andrea di Nicola, Anti-Corruption Measures in the Italian Experience. Towards the Re- duction of Opportunities for Corruption. Trento 1998 (Trento University, Transcrime Working Paper No. 26, August 1998), 6, available at . 52 Della Porta / Vanucci, Corruption and Anti-Corruption (above fn. 34), 830. 53 Ibid., 850. 54 Freedom House, Nations in Transit 2003: Latvia, available at ; Freedom House, Nations in Transit 2004: Latvia, available at . 55 Valts Kalniņš et al., Report on Corruption and Anti-Corruption Policy in Latvia, 2005 Second Semiannum. Riga 2006 (Centre for Public Policy Providus, Corruption °C report No. 2), 21f., available at ; More Corruption °C reports are available at . 56 Inese Voika, Latvia, in: Transparency International, Global Corruption Report 2005, 172-176, 173f. available at , 57 Freedom House, Nations in Transit 2003: Bulgaria, available at . Political Corruption in Late Democratizers 129 ing the customs agency in 2001 and cracked down on informal employment.58 However, high-level corruption remained unchecked. In 2002 groups within the Ministry of Energy prevented a German company from obtaining a coal mining concession, while a high-ranking official in the Ministry of Regional Development openly favoured a certain contractor in a gas pipeline tender.59 The sales of two big companies – the Bulgarian Telecom and a tobacco concern – were blocked allegedly because of the lack of political will to withdraw the state from the economy.60 Under EU pressure, a motion to close down the ubiquitous duty-free shops, which encouraged contraband by exempting bulk imports from customs duty, was twice submitted for a vote and failed because the MRF and the opposition voted against it.61 In 2005 experts noted that the government feared high-profile measures. This would cause a “chain reaction” that would destabilize Bulgarian politics.62 Thus, in all three countries mainstream and opportunistic coalition partners joined forces with the opposition to thwart reforms. The mainstream and opportunistic parties got away with their manoeuvres against reformers because the public was preoccupied with other issues such as the economy. Although by 2000 Italy’s finances had been brought under control by the leftist government and Italy’s economic competitiveness had improved, growth continued to be disappointingly slow compared to the rest of Europe, the unemployment rate was the second highest in the EU and the coalition was riddled with disagreement.63 The governments’ ploy of passing an extremely generous pre-election budget in 2000 did not help the left.64 In the run-up to the election campaign, Berlusconi made a smarter move by making bold campaign promises and pledging not to run for re-election if he failed to fulfil them.65 Even

58 Bulgaria, Romania and the EU: In the Waiting Room, The Economist, 30.10.2003, available at ; Center for the Study of Democracy (CSD), Corruption Assessment Report 2002. Sofia 2003, 81; enterC for the Study of Democracy (CSD), Corruption Assessment Report 2003. Sofia 2004, 6; Center for the Study of Democracy (CSD), Anti-Corruption Reforms in Bulgaria. Sofia 2005, 9. All three aforementioned reports are available at . 59 CSD, Corruption Assessment Report 2002 (above fn. 58), 88. 60 Ibid., 86. 61 Center for the Study of Democracy (CSD), On the Eve of EU Accession. Anti-Corruption Reforms in Bulgaria. Sofia 2006, 23, available at . 62 CSD, Anti-Corruption Reforms in Bulgaria (above fn. 58), 7. 63 Vietor, Italy’s Economic Half-Miracle (above fn. 37); Italy: Muddle, The Economist, 24.08.2000, available at . 64 Italy: Payback Time, The Economist, 05.10.2000, available at . 65 John Foot, Silvio Berlusconi, the 2006 Elections and the Future of Italy, The Political Quarterly 77 (2007), no. 4, 501-520. 130 Daniela Ivanova so, under the following Berlusconi administration Italy’s competitiveness and productivity declined as wages and the public debt kept rising.66 At the next elections Romano Prodi won by pledging to revive the inheritance tax for the wealthiest, abolished under Berlusconi, and to cut payroll taxes.67 However, faced with a widening budget deficit, the Prodi government increased taxes and cracked down on tax evasion. The country’s finances improved, but the tax burden rose.68 Again, the left proved to be its own worst enemy due to internal squabbling, and after two failed votes of confidence Prodi resigned in 2008, being unable to implement anti-corruption bills in procurement, party finance and asset confiscation.69 In the early elections that followed, Berlusconi won by criticising the left for increasing taxes and failing to boost the economy.70 In Latvia, Repse’s departure coincided with a decline in trust in the parliament and the political parties.71 His successor became mired in appointment scandals for the directorship of KNAB and for Latvia’s representative to the European Commission and had public trust ratings that were only half of those Repse had enjoyed in 2003.72 Experts attributed the strong showing of nationalist parties in the June 2004 European Parliament election as a protest vote against Repse’s successor.73 In late 2004 New Era joined a new coalition government led by Aigars Kalvitis of the People’s Party, but resigned in protest in early 2006, when another coalition partner, Latvia’s First Party, was implicated in a municipal vote-buying scandal and refused to step down. Even so, the Kalvitis government presided over the fastest-growing economy in the European Union (10.6 % GDP growth in 2005) and over a credit boom that led to sharp rises in consumption, real wages, property prices and a roaring construction sector.74 In 2006 Repse was re-elected along with his opportunistic partners.

66 Italy’s Election: Basta, Berlusconi, The Economist, 06.04.2006, available at . 67 Prodi Victorious in Italian Poll, The Guardian, 11.04.2006, available at . 68 Italy’s Government: The Enduring Mr Prodi, The Economist, 10.05.2007, available at . 69 Della Porta / Vanucci, Corruption and Anti-Corruption (above fn. 34), 849. 70 Maria Rita Latto, Newsweek and “Veltrusconi”, i-Italy, 01.04.2008, available at . 71 Freedom House, Nations in Transit 2006: Latvia, available at . 72 Ibid. 73 Freedom House, Nations in Transit 2005: Latvia, available at . 74 Pauls Raudseps, Comes the Fall, Transitions Online, 12.12.2007, available at ; Bertelsmann Stiftung, BTI 2010 – Latvia Country Report. Gütersloh 2009, 2, available at . All BTI reports are available at . Political Corruption in Late Democratizers 131

In Bulgaria, the SCG government lost two-thirds of its national vote in the 2003 local elections despite its macroeconomic successes, and split up in 2004.75 One reason for the NMSII’s loss of popularity were its political compromises: it had formed a coalition with the unpopular MRF and had appeased the left with two ministerial posts.76 Another reason was the fact that it had failed to deliver on its promise to raise Bulgarians’ living standards within 800 days and was seen as being too close to powerful lobbies.77 In the 2005 elections, a record low number of voters went to the polls and forced the NMSII to govern in coalition with the mainstream Bulgarian Socialist Party (BSP) and the MRF – two parties that benefited from the vote of their respective social and ethnic clienteles.78 This rudimentary analysis suggests that, although not oblivious to palpable corruption scandals, the public in all three countries demonstrated a preoccupation with economic well-being when evaluating anti-corruption reformers. However, the public had to pay a price for their oversight as re-elected mainstream and opportunistic parties formed governing cartels with solid parliamentary majorities and acted with a sense of impunity. Berlusconi’s victory in 2001 enabled him to pass laws favourable to his business empire and thwarting judicial proceedings against him.79 In 2002, false accounting was decriminalized, thus ending two on-going trials against Ber- lusconi.80 In 2004, the “Gasparri Law” undermined anti-trust regulations and allowed Berlusconi’s media empire to grow.81 The 2003 “Schifani Law” granted immunity from prosecution to the five highest-ranking office-holders of the state despite an opposition boycott and street rallies against it.82 In 2004/05 the

75 Freedom House, Nations in Transit 2004: Bulgaria, available at ; Freedom House, Nations in Transit 2005: Bulgaria, available at . 76 Freedom House, Nations in Transit 2003: Bulgaria (above fn. 57). 77 Daniel Simpson, An Ex-King Slips Fast As Bulgaria Languishes, The New York Times, 13.12.2002, available at ; Lyubka Slavkova, Europe and the Parliamentary Election in Bulgaria, 25th June 2005. Colchester 2005 (EPERN Election Briefing No. 21), 2, available at . 78 Cf. International Institute for Democracy and Electoral Assistance (IDEA), Voter Turnout Data for Bulgaria, available at ; Freedom House, Nations in Transit 2006: Bulgaria, available at . 79 Della Porta / Vanucci, Corruption and Anti-Corruption (above fn. 34), 848. Alberto Vanucci, The Controversial Legacy of “Mani Pulite”. A Critical Analysis of Italian Corruption and Anti-Corruption Policies, Bulletin of Italian Politics 2 (2009), no. 2, 233-264, 255. 80 Ibid., 264. 81 Della Porta / Vanucci, Corruption and Anti-Corruption (above fn. 34), 843. 82 Ibid., 848; Donatella Campus, Defeated and Divided? The Left in Opposition, in: Daniele Albertazzi et al. (eds.), Resisting the Tide. Cultures of Opposition Under Berlusconi (2001- 06). New York 2009, 71-82, 73. 132 Daniela Ivanova

“Castelli Draft”, a judicial reform that would limit judges’ ability to investigate and vest more powers into a hierarchical prosecution responsible to the executive, resulted in several near-total judicial strikes.83 When Berlusconi came back to office in 2008, he accused the Constitutional Court of working with the left in order to overturn another executive immunity bill.84 A controversial “gag law” proposed in 2009 restricted the use of special investigative techniques for privacy purposes, while endangering investigations of organized crime and corruption, and imposed heavy fines for journalistswho published information acquired through the use of wiretaps.85 In Latvia Kalvitis’ second term was dominated by corruption scandals and special interest legislation. People’s Party founder Andris Šķēle was implicated in a scandal involving the introduction of digital television in Latvia.86 The Union of Greens and Farmers was implicated in an illegal funding scandal involving Aivars Lembergs, an oil transit tycoon and mayor of the port city of Ventspils.87 The slew of investigations might account for the notorious national security decree of January 2007, which would have given MPs access to secret information on NATO affairs, criminal investigations and witnesses. The decree would have come into force for the duration of the parliamentary recess had the President not called for a referendum, which automatically suspended the laws.88 In September 2007, prior to KNAB’s announcement of fines for election campaign irregularities, PM Kalvitis suspended the head of KNAB for minor book-keeping errors, but mass protests – the “umbrella revolution” – forced him to resign.89 However, the next government was drawn from the same opportunistic parliamentary majority and headed by Ivars Godmanis of the Latvia’s First Party / Latvia’s Way coalition. In Bulgaria the triple coalition that came to power in 2005, led by the socialist Sergei Stanishev, rested on mutual distrust as its members had accused each

83 Della Porta / Vanucci, Corruption and Anti-Corruption (above fn. 34), 849; John Hooper, Strike over Berlusconi Bill Closes Italian Courts, The Guardian, 25.11.2004, available at . 84 Vanucci, The Controversial Legacy (above fn. 79), 253; Freedom House, Countries at the Crossroads 2011: Italy, available at . 85 Ibid.; Vanucci, The Controversial Legacy (above fn. 79), 253. 86 Valts Kalniņš et al., Report on Corruption and Anti-Corruption Policy in Latvia (above fn. 55), 23. 87 Freedom House, Nations in Transit 2008: Latvia, available at . 88 Ibid. 89 Latvia: Update No. 322, Free Geopolitical Newsletter, 25.10.2007, available at . Political Corruption in Late Democratizers 133 other of corruption during their campaigns.90 Informal politics took prevalence as a “Political Council” all but replaced the government as the main decision maker.91 Public finances were subject to a non-transparent ractice:p the government allocated the end-of-year budget surplus as subsidies to businesses without clear selection criteria, including state-owned companies and agricultural funds, traditionally allied with the BSP and the MRF.92 Further corruption scandals included cases of embezzlement by a senior civil servant in the tax administration and the director of a public utility company, links between the minister of the interior and organized crime, a minister soliciting bribes from a Canadian gold mining company for granting a concession, the loss of 5 billion USD in illegal swaps of highly valued state-owned land for cheaper private land, and the unprecedented withdrawal and freezing of EU accession funds due to two scams with EU funds for agriculture and infrastructure.93 In all three countries the public quickly came to regret electing opportunists and mainstream parties that serve particular interests and cultivate clienteles. In retrospect, it is worth asking what enabled this impunity. In Italy a highly fragmented and polarised party system and an electoral system designed to favour broad coalitions constrained voters’ alternatives. The partisan legacy of the cold war helped Berlusconi portray his corruption trials as a conspiracy of “red judges”. In both 2001 and 2006 the Italian left was so divided and dysfunctional that it presented a less viable alternative than Berlusconi’s centre-right coalition, which was kept together by an iron fist and generous spoils.94 In addition, the voters of the left were not united in their aims: white-collar workers and intellectuals protested against corruption, while the trade unions protested against labour market reform.95 Since Berlusconi controlled public media as Prime Minister, in his second term he was able to remove public TV-hosts and punish right-wing newspa-

90 Daniel Smilov, Political Liberalism in Bulgaria: Achievements and Prospects. Sofia 2011 (Friedrich-Ebert-Foundation –Office Bulgaria, Analyses, June 2011), 25, available at ; Freedom House, Nations in Transit 2006: Bulgaria (above fn. 78). 91 Center for the Study of Democracy (CSD), Anti-Corruption Reforms in Bulgaria: Key Results and Risks. Sofia 2007, 35, available at . 92 CSD, Anti-Corruption Reforms in Bulgaria (above fn. 58), 82; Center for the Study of Democracy (CSD), Crime Without Punishment: Countering Corruption and Organized Crime in Bulgaria. Sofia 2009, 76, available at ; CSD, On the Eve of EU Accession (above fn. 61), 24. 93 Irina Ivanova, Factbox: Seven Scandals from Bulgaria, Reuters (US edition), 29.06.2009, available at . 94 Campus, Defeated and Divided? (above fn. 82),73. 95 Ibid., 74f. 134 Daniela Ivanova per editors for discussing his corruption trials.96 Unflattering reports about his corruption problems were only accessible to left-leaning voters who consumed left-leaning channels.97 In the same way, Berlusconi was able to keep information about unpleasant issues out of the news. He criticized publications that covered Italy’s economic recession for being “defeatist” and for having caused it themselves by undermining consumer confidence.98 Reporting on the Mafia was also discouraged: Berlusconi declared he “would strangle” writers and filmmakers who tarnish Italy’s image by focusing on Mafia affairs.99 Instead, he added other issues to the agenda such as immigration.100 Another factor that helped de-emphasize corruption was the inefficiency of “Clean Hands”, which by 2000 was running out of steam due to delays and red tape, and a slew of corruption scandals within the judiciary itself.101 By 2008 only 0.2 % of Ital- ians considered corruption the most important issue facing Italy compared to almost one third in 1996.102 In sum, voters not only lacked viable alternatives to Berlusconi, but media capture might have prevented them from making a realistic assessment of his policies. In Latvia expensive media campaigns, disoriented voters and an ethnic cleavage played into the hands of opportunists. On the eve of the 2006 elections, Neatkariga Rita Avize, a newspaper allegedly owned by Ventspils mayor and oil transit tycoon Aivars Lembergs, ran a campaign against anti-corruption NGOs titled “Soros is Privatizing the Baltic States”.103 The People’s Party splurged on third-party advertising campaigns reminiscent of US Super-PACs.104 Led by the opportunistic incumbents, the “no” campaign prior to the 2008 referendum

96 Andrea Cairola / Susan Gray (directors), Citizen Berlusconi – The Prime Minister and the Press. Arlington/VA 2003 (Public Broadcasting Service – PBS)[documentary-film], available at . 97 Alexander Stille, The Corrupt Reign of Emperor Silvio, The New York Review of Books, 08.04.2010; Ruben Durante / Brian Knight, Partisan Control, Media Bias, and Viewer Re- sponses: Evidence From Berlusconi’s Italy. Cambridge/MA 2009 (NBER Working Paper 14762, March 2009), available at . 98 Stille, The Corrupt Reign of Emperor Silvio (above fn. 97). 99 Freedom House, Countries at the Crossroads 2011: Italy (above fn. 84). 100 Deepa Babington, Berlusconi’s Anti-Immigration Comments Spur Outcry, Reuters (UK edition), 10.05.2009, available at . 101 Della Porta / Vanucci, Corruption and Anti-Corruption (above fn. 34), 840; Freedom House, Countries at the Crossroads 2011: Italy (above fn. 84). 102 Ibid., fn. 67. 103 Freedom House, Nations in Transit 2007: Latvia, fn. 19, available at . 104 Valts Kalniņš et al., Report on Corruption and Anti-Corruption Policy in Latvia. First Semiannum 2006. Riga 2006 (Centre for Public Policy Providus, Corruption °C report No. 3), 28, available at . Political Corruption in Late Democratizers 135 on the popular right to recall parliament relied heavily on russophobia.105 A 2008 survey showed that these campaigns mainly resonated with uninformed voters.106 In 2010 the electorate was divided between those who were outraged by revelations of excessive salaries and bonuses in a bailed-out-bank and state- owned companies, and those who thought corrupt politicians can be supported if they also take care of the rest of society.107 Lembergs gained popularity by criticising Latvia’s IMF bailout as “blackmail” and “neocolonialism”.108 Concerns about media capture emerged in 2010, when the political bloc Unity filed a complaint against the opportunistic Alliance For a Good Latvia for slant- ing election coverage on the public broadcaster LTV. The latter responded with similar accusations against the corruption coverage by watchdog media such as IR and TV3 as well as the NGO Delna (TI Latvia), allegedly influenced by the clean-hands alliance Unity.109 In brief, Latvia’s governments were effectively elected by only two thirds of its electorate who were split into a clientelist and a reformist camp and who consumed different media. In Bulgaria different factors were at play: disillusionment, clientelist voting camps, ineffective checks and balances and the lullof continued EU monitoring contributed to widespread apathy towards the topic of corruption during elections. Since the early 2000s, one third of Bulgarians regularly abstained from voting, while a core electorate of about 10 % formed around the MRF (consisting mainly of less educated rural Bulgarian Turks) and one of 15 % around the BSP (consisting mainly of retired people and rural inhabitants), while the remaining voters tended to float.110 Prior to the 2005 elections, the NMSII’s support had

105 Vita Dreijere, “Diena” jautā politiķiem: Vai jūs iesiet uz referendumu? Kāpēc?, Diena, 31.07.2008; available at and (partly) in English . 106 Valts Kalniņš et al., Report on Corruption and Anticorruption Policy in Latvia. Second Semiannum 2008. Riga 2009 (Centre for Public Policy Providus, Corruption °C report No. 8), 26, available at . 107 Latvian “Robin Hood” Hacker Leaks Banks Details to TV, BBC News, 24.02.2010, available at ; Rusu, A Diagnosis of Corruption in Latvia (above fn. 46), 16. 108 Arne Bengtsson, The Baltic Berlusconi. Recovery Takes Place in Silence, Baltic Worlds 4 (2011), no. 2, 28f., 29, available at . 109 Jānis Juzefovičs, Mapping Digital Media: Latvia. New York 2011 (Open Society Foun- dations report, 09.11.2011), 33, available at ; Emelie Lilliefeldt, A Coalition of Coalitions: The 2010 Parliamentary Elections in Latvia, balticworlds.com, 09.10.2010, available at . 110 Based on data from Gallup International Institute, Information System for Historical Data from Socio-Political and Election Surveys since 1991, Political Surveys (in Bulgarian), available at . 136 Daniela Ivanova declined due to poor economic performance, and without a new anti-corruption alternative, core electorates and clienteles had the final say. Awareness of corruption was on the increase in the second half of the decade. In 2007, the EU’s decision to continue monitoring Bulgaria’s judicial and rule of law reform after the country’s EU accession coincided with corruption becoming the number one issue facing society.111 In 2008 EU sanctions for abuse of EU funds damaged the reputation of the government beyond repair. Three out of four Bulgarians did not trust their government, whereas every second Bulgarian continued to trust the European Commission.112 It did not help that there was no anti-corruption agent that could coordinate public action: the anti-corruption service was mired in intrigue and information leaks, the president was compromised by revelations of his unexplained wealth, the NGO sector was discredited by reports of its capture by politicians and civil servants.113 Social activism was limited to protesting against unregulated construction in or near natural reserves and against low public sector wages.114 In late 2008 the government managed to forestall public anger at declining economic conditions due to the global financial crisis by applying the budget surplus towards social security and public sector wages.115 As a result, public sector employees, a major clientele, were appeased. Only students, farmers and environmental activists took part in a January 2009 protest against government corruption and low living standards.116 The protest led the Prime Minister to invite the European Commission to get directly involved in implementing Bul- garian legislation, which, he insisted, was beyond the government’s reach.117

111 CSD, Anti-Corruption Reforms in Bulgaria. Key Results and Risks (above fn. 91), 7; Antoinette Primatarova, On High Stakes, Stakeholders and Bulgaria’s EU Membership (EPIN Working Paper No. 27, 06.04.2010), 9f., available at . 112 European Commission, Eurobarometer 70. Public Opinion in the European Union. National Report: Bulgaria. Executive Summary, Autumn 2008. Brussels 2008, 5, available at . 113 Freedom House, Nations in Transit 2010: Bulgaria, available at ; Freedom House, Nations in Transit 2007: Bulgaria, available at ; CSD, Crime Without Punishment (above fn. 92), 38; Freedom House, Nations in Transit 2008: Bulgaria, available at . 114 Freedom House, Nations in Transit 2009: Bulgaria, available at ; Lyuben Tomev, State Railway Protest Ends in Favourable Collective Agreement, eiroline, 30.07.2007, available at . 115 Bertelsmann Stiftung, BTI 2012 – Bulgaria Country Report. Gütersloh 2012, 4, available at . 116 Irina Ivanova et al., Bulgaria Anti-Government Protest Turns into Riot, Reuters (US edition), 14.01.2009, available at . 117 Kerin Hope, Peaceful Protest Turns to Riot in Sofia, Financial Times, 14.01.2009; The European Union and Bulgaria: A New Colonialism, The Economist, 19.03.2009, available at . Political Corruption in Late Democratizers 137

This unusual request reflected the reliance on the EU that many Bulgarians felt. Yet, bringing down the Stanishev government would have been a futile effort mere months before the next regular elections were scheduled in July 2009. It seems that the major factors for the apathy of the Bulgarian public were the lack of vocal anti-corruption institutions, the lack of viable anti-corruption alternatives, and over-reliance on EU monitoring. In all three countries drastic changes in the economic and political circumstances caused opportunistic parties to get discredited. In Italy a combination of sex scandals surrounding the Prime Minister and encroachment on the freedom of the press drew protesters to the streets. Fol- lowing lawsuits filed by Berlusconi against two newspapers critical of him, hundreds came out to protest in Rome in October 2009 and an estimated 350,000 came out for a “No Berlusconi Day” in December.118 Italy’s main newspapers across the board called for a 24-hour strike on July 9, 2010 in response to the “gag law” proposal.119 A hint that the end of public patience was near was the pronouncement of the Italian Church criticizing Berlusconi’s private life in Janu- ary 2011, which has been interpreted as a shift of the traditional conservative establishment away from Berlusconi and his party.120 The public expressed its disapproval in the municipal elections in May 2011, casting “massive majority votes for candidates outside the political mainstream” in Naples and Milan.121 In a referendum in June, voters also voted overwhelmingly against government proposals for the privatization of water services, a return to nuclear energy, and protecting cabinet ministers from prosecution.122 By 2011 Italy had the third highest public debt in the developed world and its rankings on ease of doing business and competitiveness were below those of some developing countries.123 In early July 2011, Italian bond yields began to rise alarmingly and an austerity package with most measures scheduled for

118 Stille, The Corrupt Reign of Emperor Silvio (above fn. 97). 119 John Hooper, Silvio Berlusconi’s “Gag Law” Sparks Media Strike in Italy, The Guardian, 09.07.2010, available at . 120 Philip Pullella, Italian Church Warns Berlusconi Over Sex Scandal, Reuters (US edition), 24.01.2011, available at ; Carlo Ungaro, After the Fall of Berlusconi, Who Reaps the Benefits?, openDemocracy, 30.11.2011, available at . 121 Ibid. 122 Italy Nuclear: Berlusconi Accepts Referendum Blow, BBC News, 14.06.2011, available at . 123 Silvio Berlusconi’s Record: The Man Who Screwed an Entire Country, The Economist, 09.06.2011, available at . 138 Daniela Ivanova after the elections in 2013 did not inspire confidence.124 By October international pressure to pass austerity measures and mistrust in Berlusconi resulted in widespread defections from his party. In November 2011 he was only able to get an austerity package through parliament by promising to resign.125 Thousands cheered at his resignation.126 In Latvia heavy-handed government decisions on the financial crisis coincided with a pattern of egregious pro-corruption gestures, which regularly led media watchdogs, the civil society and the presidency to galvanize the public in protest. Although the Kalvitis government withdrew the controversial national security laws of January 2007, the automatic referendum procedure triggered by the outgoing president saw half the electorate cast their vote against it, thus expressing their discontent with the government.127 When the “umbrella revolution” of October 18, 2008 proved insufficient to change parliament’s decision to dismiss the KNAB’s director for a minor irregularity, civil society groups staged a bigger mass protest on November 3.128 While the Latvian economy contracted drastically in 2008, the secrecy and unaccountability of government decisions only added to economic discontent.129 In a failed referendum in 2008, an overwhelming majority of those who did vote cast their vote in favour of granting the public the right to dissolve parliament.130 An ill-judged statement in late 2008 made matters worse: PM Godmanis told Latvians to “huddle together” like penguins to survive the crisis.131 Public frustration culminated in a 10,000-strong protest march on January 13, 2009 – the “penguin revolution”.132 On the next day the president issued a memo-

124 James Mackenzie, Italy’s Berlusconi Pledges Growth as Markets Plunge, Reuters (US edition), 04.08.2011, available at . 125 Gavin Hewitt, The Last Days of Silvio Berlusconi, BBC News, 09.11.2011, available at . 126 Philip Pullella / Giuseppe Fonte, Berlusconi Resigns, Crowds in Rome Celebrate, Reuters (US edition), 12.11.2011, available at . 127 Freedom House, Nations in Transit 2008: Latvia (above fn. 87). 128 Mike Collier, Latvian Government Rallies around Kalvitis, The Baltic Times, 23.10.2007, available at . 129 Dorothee Bohle / Béla Greskovits, Capitalist Diversity on Europe’s Periphery. Ithaca/ NY 2012, 236. 130 Freedom House, Nations in Transit 2010: Latvia, available at . 131 Mocking T-Shirts, Penguin Jibes Lighten Mood in Latvia, Mail and Guardian, 20.02.2009, available at . 132 Freedom House, Nations in Transit 2010: Latvia (above fn. 130). Political Corruption in Late Democratizers 139 randum to the ruling parties to adopt accountability measures or face new elections.133 Under public pressure, the government pushed through a new law on election campaigning, but lost support and made way for a new government led by Valdis Dombrovskis of New Era.134 Dombrovskis presided over austerity measures, pushed through the popular right to dissolve parliament, passed a bill introducing partial public funding for parties and abolished the electoral option to list so-called ’star’ candidates as members of more than one electoral district.135 He was rewarded with a second mandate in the 2010 elections, but so were opportunistic parties. Dombrovskis had to govern with one of them – the controversial Union of Greens and Farmers.136 The coalition partners clashed over measures for prosecuting unexplained wealth, appointments and the criminali- zation of illegal party financing. Disagreement culminated in May 2011, when the Union of Greens and Farmers aligned themselves with the opposition to block the motion to allow KNAB to search the home of a celebrity businessman MP. The President responded by calling a referendum to dissolve parliament.137 Over 90 % of votes cast were in favour of the dissolution of parliament. Shortly before the elections, an embattled parliament finally passed a measure that criminalized illegal party financing, which had been on the floor for five years.138 The elections in September returned a house that was free of opportunistic parties. Unlike Latvia, but very similar to Italy, Bulgaria suffered from an under- supply of viable anti-corruption alternatives in the 2005 elections. In 2009 Bulgarians seized the opportunity created by the party Citizens for a European Development of Bulgaria (GERB). The party was created in 2006 and had ample opportunity to organize nationally and locally by participating and winning the largest share of the vote in the 2007 European Parliament and local elections.139 In the 2009 general elections, the party won close to 40 % of the Bulgarian vote,

133 Juris Rozenvalds / Ivars Ijabs (eds.), Latvia. Human Development Report, 2008/2009: Accountability and Responsibility. Riga 2009 (Advanced Social and Political Research In- stitute – ASPRI), 29, available at . 134 Freedom House, Nations in Transit 2010: Latvia (above fn. 130). 135 Ibid.; Latvian Political Parties Starting to Receive Public Funding as of 2012, KNAB news, 16.01.2012, available at . 136 Freedom House, Nations in Transit 2011: Latvia, available at . 137 Zatlers Dissolves Parliament, The Baltic Times, 30.05.2011, available at . 138 Latvia in Review (6.-12.12.2011), no. 36, 4f., available at . 139 GERB – “Citizens for European Development of Bulgaria”, expats.bg (July 2012), available at . 140 Daniela Ivanova including 26 out of the 31 single member seats that the previous government had created with a last minute amendment.140 The socialist BSP tried to lure voters away form GERB by linking its liberal ideology to that of the declining UDF which had imposed harsh austerity measures in the late 1990s.141 However, offering a pragmatic liberal alternative to the old right was not the only reason for GERB’s success. An electoral promise to fight corruption and organized crime seemed believable coming from its leader Boiko Borisov, who is a former karate champion, has been the bodyguard of two prime ministers, is a former Chief Secretary of the Interior Ministry and former mayor of the City of Sofia. GERB even accommodated the extreme right by distancing themselves from the ethnic Turkish MRF, which might have galvanized MRF support to a record 15 %.142 Whether due to Borisov’s popularity, to the EU sanctions or to ethnic politicking, turnout was 5 % higher than in 2005, reaching 60 %.143 Borisov’s victory resulted in a minority government that was supported by independents and nationalists. Reforms in the agencies distributing EU funds and a transparent procurement procedure for a landmark infrastructural project convinced the European Commission to unlock the funds it had frozen in 2008.144 The Borisov government pushed through a radical reform in the confiscation of illegally acquired assets, which no longer had to be preceded by a court sentence.145 In addition, a specialized court and prosecution agency for corruption and organized crime were created. A number of indictments in organized crime and high-level corruption cases were reached, among others against two members of parliament, three former ministers, three former deputy ministers and, for the first time, an acting minister.146 Desperate to see the rule of law applied without bias, Bulgarians recorded their highest institutional trust in Borisov and the police.147 What remains to be seen is whether these developments mark a sustainable change in the way politics is conducted in the three countries.

140 Bertelsmann Stiftung, BTI 2012 – Bulgaria Country Report (above fn. 115), 6. 141 Clive Leviev-Sawyer, Bulgaria’s Elections 2009: The Personalities that Defined the Nar- rative, the sofia echo, 05.07.2009, available at . 142 Nikolai Genov, Radical Nationalism in Contemporary Bulgaria, Review of European Studies 2 (2010), no. 2, 35-53, 44f., available at ; Bertelsmann Stiftung, BTI 2012 – Bulgaria Country Report (above fn. 115), 15. 143 Ibid., 6. 144 Freedom House, Nations in Transit 2010: Bulgaria (above fn. 113); Freedom House, Nations in Transit 2011: Bulgaria, available at . 145 Ibid. 146 Bertelsmann Stiftung, BTI 2012 – Bulgaria Country Report (above fn. 115), 11. 147 Ibid., 16. Political Corruption in Late Democratizers 141

In Italy the fallout of Berlusconi’s rule undermined the efforts of his technocratic successor Mario Monti to return morality to politics. The political shake-up allowed funding scandals in the main centre-right parties and rampant corruption in regional governments in Lazio, Calabria and Lombardy to be revealed.148 As a result, the rate of confidence in political parties is below 5 % and in late 2012 half of Italians were thinking of abstaining from voting in the elections in February 2013.149 In October 2012, public discontent finally resulted in a bill that increases penalties for corruption and prevents those charged with corruption from running for office.150 Additional legislation for an anti-corruption agency and reining in regional spending were also on the floor. But Monti’s unpopular economic reforms led to his defeat in the recent elections in favour of the mainstream left and right.151 The Five Star Movement, an anti-political and anti-corruption formation, won a surprising 25 % of the vote, but is doing more to hinder the process of government than to reform it.152 In Latvia the new government, composed of the liberal anti-corruption alliance Unity, the former president’s party and the right-wing National Alliance, has passed important measures that had been delayed for years. In December 2011 they introduced the so-called initial asset declaration, which will allow KNAB and the State Revenue Service to detect suspicious changes in the assets of state officials.153 The start of 2012 also marked the beginning of partial public funding for political parties. However, the lack of progress in so-called “oligarch trials”, involving leaders of opportunist parties such as Lembergs and Slesers, remains a challenge.154 Other issues that threaten good governance have taken

148 Italian Politics: Pig’s Head Masks and Togas, The Economist, 29.09.2012, available at . 149 Rachel Donadio / Elisabetta Povoledo, Corruption attlesR Italians’ Already Shaky Trust in Politicians, The New York Times, 17.10.2012, available at ; Italian politics: Pig’s Head Masks and Togas (above fn. 148). 150 Philip Pullella, New Italy Law Tackles Rampant Corruption, Reuters (US edition), 30.10.2012, available at . 151 Lizzy Davies, Italian Elections: Mario Monti’s Centrist Alliance Set for Fourth Place, The Guardian, 25.02.2013, available at . 152 Gavin Jones / Francesca Piscioneri, Analysis: It’s About to Get Serious for Italy’s Tri- umphant Comic Grillo, Reuters (US edition), 26.02.2013, available at . 153 Latvia – Saeima Adopts the Act on Initial Asset Declaration, Lexuniversal, 27.12.2011, available at . 154 See e.g. Prosecutor’s Office too Weak for Lembergs, Baltic News Network, 26.07.2012, available at . 142 Daniela Ivanova the place of corruption, namely hostility to Latvia’s large Russian minority and international concern about facilitation of money-laundering.155 In Bulgaria under the GERB government the public’s preoccupation with law and order helped create the foundations of a police state. In its reports the European Commission commended Borisov’s anti-corruption legislative work, but noted that implementation was lacking, especially regarding judicial proceedings against organized crime and high-level corruption. Members of the previous governments, indicted in landmark corruption cases, were acquitted.156 The fact that two cases for abuses of EU agricultural funds in 2008 ended with lengthy prison sentences in the first instance only to be promptly reversed at the second instance due to gross irregularities in the proceedings, is indicative of opportunism by magistrates and government members alike.157 An on-going verbal confrontation between judges and the executive, the dismissal of a critical judge on dubious grounds, the refusal to improve the selection procedure for the judiciary’s self-governing body and a failed appointment to the constitutional court have led the European Commission to question the independence of the judiciary in Bulgaria.158 Finally, an increase in the use of wiretapping in investigations, arbitrary electronic data collection, police brutality and humiliating televised arrests, with the approval of the authorities, have led to comparisons with a police state.159 A perverse dynamic occurred, whereby the public suffered under painful austerity measures and poor welfare provision but supported a “strong hand” as the solution to the country’s social and economic problems.160 Yet, in a bizarre twist of fate in February 2013 mass protests against exorbitant electricity prices, allegedly due to the capture of the state’s energy regulator by private interests, resulted in the GERB government’s resignation.161 Although the reformist Bul-

155 Latvia Rejects Making Russian an Official Language, BBC News, 19.02.2012, available at ; Aleks Tapinsh, Latvia Sees Good and Bad as Russian Money Haven, Reuters (US edition), 23.10.2012, available at . 156 Anna Zarkova / Vladimira Georgieva, Procesite sreštu vlastta – v sljapa ulica, Trud, 25.10.2012, available at . 157 Petja Vladimirova, Provalăt na znakovite dela: lošata i dobrata novina, Praven Svjat, 28.09.2012, available at . 158 Ralitsa Kovacheva, The Court vs. the Interior Ministry: Operation “The Fools” against Society, euinside, 28.07.2010, available at ; EC Warns Bulgaria about Interim Report over Judicial Election, Novinite.com, 31.10.2012, available at . 159 Bertelsmann Stiftung, BTI 2012 – Bulgaria Country Report (above fn. 115), 12f. 160 Ibid., 2, 16. 161 Bulgarian Politics: Power Protests, The Economist, 23.02.2013, available at . Political Corruption in Late Democratizers 143 garian President has appointed a capable team of technocrats as interim government until the upcoming elections in the summer, widespread disillusionment with political parties of all colours might yet cause a bigger political crisis.162

Conclusion

This study set out to examine the validity of several explanations of why voters might vote for corrupt parties in a democracy: lack of information, lack of an effective choice, partisanship, and clientelism. The test has been challenging given the patchy nature of the data, but some useful results emerge that can serve as the basis for future empirical study. In Italy high election turnout163 can be explained with a strong left-right partisan divide, kept alive more rhetorically than in political practice, as the left has reportedly achieved more economic liberalization than the right.164 However, anecdotal evidence points to a lack of viable alternatives – the left was simply too divided and could not provide a stable government in either 2001 or 2008. Media capture, although not explored in detail, is potentially a very significant factor as it gave Berlusconi a highly effective agenda-setting tool. In addition, the fact that Berlusconi’s hallmark electoral strategy (promising tax cuts) has managed to propel him into second place in the recent elections165 might demonstrate the strength of clientelist voting. In Latvia a combination of expensive electoral advertising, occasional smear campaigns, nationalist rhetoric and skilfully deployed anti-IMF rhetoric created a captive “uninformed” clientele that helped to keep opportunists in parliament. Fortunately, strong links between watchdog media and civil society, an activist presidency and a great deal of experience with anti-corruption protest prepared the ground for a drastic measure in 2011 – new elections in response to a highly opportunistic decision by the MPs. In Bulgaria a lack of alternatives is as likely to be the main factor for pro- corruption voting as clientelism. In 2005 there was no new liberal anti-corruption alternative to the NMSII that could rally the Bulgarian majority, and in 2009 the

162 Tsvetelia Tsolova, Bulgaria Taps Experience for Interim Government, Reuters (US edition), 12.03.2013, available at . 163 Voter turnout in Italy has consistently been close to or over 80 % until 2013, based on data by the International Institute for Democracy and Electoral Assistance (IDEA), available at . 164 The Italian Crisis: Addio, Silvio, The Economist, 12.11.2011, available at . 165 Lizzy Davies, Silvio Berlusconi Accused of “Dangerous Propaganda” over Italy Tax Cut Vow, The Guardian, 03.02.2013, available at . 144 Daniela Ivanova only such alternative was a party founded by a charismatic leader with a law enforcement background. Lack of alternatives is likely to mark the upcoming elections as well. Regarding the continuity hypothesis, both the public and the political class in the three countries have shown varying degrees of learning ability, mostly determined by the linkage of the issues of corruption and economic performance. Latvia saw a long uninterrupted period of coexistence of both types of populism in a period of economic growth from 2002 to 2007. The economic crisis that engulfed Latvia in 2008 helped put political extravagance in perspective. In the meantime, a vibrant civil society, an activist presidency and an effective anti-corruption agency were establishing a tradition of anti-corruption social activism, which reversed the MPs’ pro-corruption decisions in 2004, 2007, 2008, 2009 and 2011. This tradition helped anti-corruption reformers and the Latvian public to react swiftly and coordinate their vote in the decisive 2011 elections. Italian voters played with the left alternative in 1996 and 2006, but rewarded Berlusconi for maintaining the status quo rather than restructuring the economy or raising taxes. In the end, it was less anti-corruption activism than an aver- sion to Berlusconi’s private life and the pressure of international markets that led to the collapse of his coalition in 2011. Therefore it is not surprising that in the 2013 elections, Berlusconi came second with his old brand of populism. A weak victory for the left and the substantial protest vote for the anti-political Five Star Movement have resulted in a political impasse in Italy. In Bulgaria clienteles punished the liberal economic policies of the SCG government in 2005 and fell back on the mainstream left, which preferred to extract rents without taking responsibility for governance failure. In 2009 voters flocked to the next easily available alternative – the “strongman” Boiko Borisov and his GERB party – and gave it a decisive mandate. Worryingly, the long- term effects of such choices might jeopardise democracy in Bulgaria. During the protests of February 2013 one anti-democratic sentiment was replaced by another: a chronic longing for law and order ceded to vocal hostility towards the party system as a whole. In summary, several lessons emerge for beating political corruption at the polls. In the first place, both the public and politicians need to agree on their priori- ties. If the public is more preoccupied with fighting crime, obtaining tax cuts and benefits or minority issues, then liberal anti-corruption reformists might not obtain a decisive mandate. Secondly, corruption can be transformed into a salient issue. Vocal and independent checks and balances can serve as a trigger for social activism. Ironi- cally, Italy’s and Latvia’s indirectly elected presidents have done a better job Political Corruption in Late Democratizers 145 than Bulgaria’s popularly elected presidents, who are also dependent on their party’s campaign support. Thirdly, if a corrupt governing cartel with a parliamentary majority is un- willing to resign, the popular right to recall parliament might be a useful constitutional provision. Finally, revelations of corruption have the strongest effect against the background of a free-falling economy. Anti-corruption reforms do not make a lasting impression under conditions of economic well-being. An economic crisis is the best time to make a clean sweep. On a cautionary note, prolonged economic crisis and perceived impunity of the traditional political class may cause anti- political sentiment that jeopardises democracy. Such sentiment put the balance of power in Italy in the hands of an unwieldy anti-political formation and is threatening to undermine the party system in Bulgaria.