Democracy on paper – capture in practice!

This paper is based on the research Croatia’s Captured Places conducted in three local and one regional government unit in Croatia (Dubrovnik, Slavonski Brod, Zagreb and the County of Istria). It was focused on actors and mechanisms of governance in which a system or parts of a system are appropriated by powerful individuals, groups or networks to favour their own interests. Furthermore, it explored the extent to which citizens of these communities were aware of such practices and citizens’ attitudes towards these practices.

On the basis on, for the most part, already publicly available information, validated by means of a combination of qualitative research methods, the research confirmed the presence of capture practices in each of the localities, albeit on a different scale, and adapted to local political contexts as well as to the nature and quantity of resources available. Furthermore, it confirmed the astuteness of actors in combining formal rules and informal practices in order to achieve particularistic interests.

The effects of capture produce numerous negative outcomes:

• creating new or widening existing inequalities (access to jobs, access to business opportunities, possibilities of self-actualization),
• generating a sense of inability and pointlessness of public action
• political apathy and disinterest in politics on the part of citizens.

 On its own, each of these elements has a negative effect on the political and social development of local communities, while their combined effects are seriously detrimental to the further development of democracy.

The study identified several policy areas “conducive” to capture in all chosen localities: (1) employment/appointments; (2) communal construction works (3) spatial planning; and (4) social policy measures. Each of them has specific, multiple functions that enable or perpetuate capture, as shown in the Table below:

 Moreover, the study revealed that capture practices are enabled and supported by existing legal and institutional frameworks, and that they are developed in interaction between our identified agents of capture and the leading national parties (HDZ and SDP). The formal aspects of governance, i.e. the existing laws can become enablers which contribute to the further development and sustainability of informal practices and in the end contribute to capture and serve to undermine the declared purposes of measures proposed to safeguard consolidated democracy.

In terms of shared elements across the four localities, the study has identified the invisible hand of the political market in all localities, although the modalities of “political trading” between local and national levels are highly contextualised. Other shared elements fall under the heading of captured control mechanisms – political opposition, media and civil society – where weaknesses of the opposition are again locally highly context specific. As regards the local media, they are financially dependent on local authorities, which constrains almost entirely any type of criticism, and consequentially impedes their working in the public interest. The situation is similar with civil society, which tends to be weak at local level, and in the rare instances when civil society acts as a corrective of local state authorities, CSOs face public defamation and “disciplinary” measures – including the withdrawal of funding and/or working space.

The short-term positive effects of sets of policy measures do not decrease the longer-term negative effects of local state capture on the part of power networks, especially if they are analysed from the perspective of their function – ensuring re-election of those who make sure that particularistic interests are satisfied.

Since many of the identified practices do not represent a breach of legal norms, this, in part, explains the lack of serious and systemic attempts to restructure the country territorially. Namely, an “enabling” legal environment may be interpreted as a means to maintain the status quo, which facilitates power networks’ maintaining their position and status, thus increasing the amount of resources at their disposal. The power of the network largely stems from the value of the resources controlled, while the potential to increase that value in the future is a powerful motivation to uphold the status quo.

Regarding the citizens, the dominant position is that political corruption is the starting point of Croatian politics, so voting for a “benefactor” creating multiple patron-client relationships is not a problem for them. It is precisely in the latter where the biggest danger lies – failure to “punish” the lack of political accountability in elections means that the key mechanism of representative democracy has been lost – the control and eventual political “punishment” of the governing by the governed, i.e. citizens.

The lack of interest in politics and voter apathy suit power networks, since the lower the turnout at elections the higher their chances of electoral success. Electoral success, in turn, ensures the maintenance and spreading of the network. What also contributes are the decisions of parts of the judicial system, which by making contradictory decisions in cases of prosecuting political corruption, with many acquittals often on ‘technical’ grounds, additionally confuses citizens and undermines their trust in the system, further increasing the political apathy of voters.

Recommendations

Given the detected apathy and lack of interest of citizens and captured control mechanisms, the points of resistance to local state capture seem relatively weak, yet with a potential to be strengthened. As a form of contribution to this strengthening, we suggest two directions of possible action: (1) changes in the normative framework and (2) broader social engagement.

1. 1.       Changes of the normative framework

 The relevant parts of the current normative framework are mostly enabling of state capture as it contributes to further development and sustainability of informal practices. The end result of such a framework undermines the declared purpose of suggested measures and normative solutions. At the same time, one should bear in mind that, given the flexibility of power networks, the end result of normative changes might be reduced to merely increasing the transaction costs of capture.  Nonetheless, this risk does not decrease the necessity of these changes to take place. Indeed, if all the suggestions regarding the normative changes were implemented simultaneously, they would represent a revolutionary shock to the status quo. Thus, the primary advocacy goal of actors working towards improving the system and quality of (local) public governance should be the insistence on simultaneous changes to the legal framework.

Specific normative changes required:

• decreasing the amount and level of authority and discretionary decision-making powers on the part of elected mayors/ county prefects by means of:
  • balancing the levels of authority between exective and legislative branches in local and regional self-government units;
  • decreasing the value of resources independently disposed of on the part of the executive;
  • proscribing identical job descriptions and job requirements for civil servant positions in local authorities and annulment of the authority of executive functions to independently define the numbers of positions and job requirements in local administration;
  • proscribing public calls for positions in public companies owned by local authorities, with strict adherence to the principle of meritocracy for employment;
  • annulling the authority of mayors and county prefects to directly appoint members of management and/or supervisory bodies of locally owned companies;
  • democratisation of managerial and supervisory bodies of public institutions and publicly owned companies by means of changing the Founding Acts, to include:
    • proscribing that these appointments are based on public calls for persons with adequate competencies for those functions;
    • proscribing a multi-sectoral composition of these bodies, including representatives of political options represented in local/regional assemblies as well as the interested public – the academic community, professional associations, trade unions, local business community and civil society;
  • proscribing the obligation for an independent needs assessment prior to founding new public companies/agencies; the assessment should clearly identify that no similar public company/agency with overlapping competencies already exists at the level of local/regional self-governance;
  • restricting the number of mandates for direct elections of executive positions, in line with the restrictions imposed on another directly elected function  - that of the President of the Republic;
  • proscribing the incompatibility of functions of mayors and members of parliament;
  • proscribing the incompatibility of holding public office for persons found guilty of abuse of power and/or political corruption, until the period of rehabilitation has expired;
  • annulment of the Law on Strategic Investments in the Republic of Croatia;
  • proscribing transparent procedures and criteria for financing local media from local budgets, and introducing multi-stakeholder commissions deciding on funding;
  • strong institutional support and protection mechanisms for whistleblowers in cases of abuse of power and/or political corruption;
  • less restrictive provisions concerning referenda initiated by citizens at the local level, as a means of resisting decisions ;
    • stronger sanctioning of insider trading with political information (e.g. information on planned changes to spatial planning policy or planned new legislation), benefitting bearers of political functions and connected persons, in line with those proscribed for insider trading offences in stock markets;
    • an analysis and identification of other normative solutions conducive to capture, which have not been detected through this research. 

Broader social engagement

Besides changing the legal framework, broader social engagement is also necessary, and should include at least the following:

• Continuation and widening the scope and depth of activities aiming to increase the level of political culture among citizens. The key role in this segment must be taken on by the education system, with the support of organized civil society and through expanding the few existing, yet very important, independent (non-profit) media outlets;
• Introducing the practice of systemic transfer of information and, where possible, engaging in joint activities between activists and investigative journalists, with the aim of recognizing practices of capture and mobilizing citizens to stand up against such practices;
• Strengthening the capacities and increasing the autonomy of local initiatives resisting practices leading to capture. This includes technical assistance and logistical support of organized civil society with proven capacities for social change to local initiatives and working on developing philanthropy among citizens and SMEs – the losers of capture.