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Friday, February 06, 2009

Pynzenyk Memo Divides Cabinet

The Pynzenyk memo refers to a written wake-up call from Finance Minister Viktor Pynzenyk that extrapolates current economic data and warns of an impending economic meltdown.

Leaked to the media, the memo created negative publicity for Premier Tymoshenko and even inspired President Yushchenko to quote it in his recent address.

From day one, spokespersons for Tymoshenko have denied the memo's authenticity. And so did Vice Premier Oleksandr Turchynov, on Wednesday:

It surprises me when such a responsible person as the President draws his conclusions regarding the state of the budget based on reports from the Internet. I am not aware of any such official letter from the Minister of Finance, and that upon this letter, with such-and-such addressor and addressee, the head of state’s conclusions could be based. That is, [we’re dealing with] the Internet, that is, [we’re dealing with] some other opinion, which has nothing to do with reality or with what’s going on in the government.

However, at least two senior government officials had already confirmed the report, speaking on last Friday’s “Svoboda” talk show on Inter.

The “whistleblowers” are: Interior Minister Yuriy Lutsenko, who backs Tymoshenko, and Customs-Chief-Cum-Deputy-SBU-Director Valeriy Khoroshkovsky, backed by Yushchenko.

Interior Minister Yuriy Lutsenko: There’s nothing secret or extraordinary about this document. Every Cabinet member got one on their desk. Nobody forbade it from being sent, contrary to what some media outlets have written about it, and the way you’re now emphasizing the word secrecy is divorced from reality.

Talk show host: What’s your take on…

Lutsenko: It’s a working document of the Ministry of Finance, just like all other documents at the Ministry of the Interior, at the Ministry of Economy, and at the Ministry Transport.

Deputy SBU Director Valeriy Khorshkovsky: Yes, I’ve seen this memo. Moreover, we even discussed it with the Finance Minister, and I want to say that I even made certain amendments because some of the figures there were beyond my comprehension.’s a real document...uh...frankly, I don’t know why it has stirred up such a commotion because, frankly, all that’s in there is a systemic look at all the problems that have been piling up during a rather long period of time.

So which one of them is not telling the truth?

Not only do they have conflicts of info in the Cabinet, but they also seem to have conflicts of interest.

Tymoshenko has admitted to “inviting” what she called “foreign investors” to participate in the Inter acquisition talks. Earlier, Khoroshkovsky, who calls himself the channel’s official owner, mentioned in an interview that Tymoshenko had expressed interest to buy Inter.

Khoroshkovsky, in his own words, had insisted that the money should be “clean,” citing transparency concerns arising from the channel’s IPO preparations. This requirement had upset Tymoshenko. “Actually, it was after this that talk of some investors began,” Khoroshkovsky said.

Tymoshenko links Inter to Firtash and accuses the channel of bias and propaganda, a claim not without foundation. Firtash owns an option to buy a 50% stake in U.A. Inter Media Group Limited, which controls Inter.

On Thursday, the Party of Regions, whose MPs have lobbied on behalf of RosUkrEnergo, failed to gather enough votes to sack Tymoshenko, after calling her on the carpet in the Verkhovna Rada.

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elmer said...

Well, I tend to believe Lutsenko. And I certainly don't agree with Tymoshenko's dictatorial edict forbidding circulation of the memo.

What is puzzling is this - why is such a memo secret?

In the US, for example, the executive branch, the legislative branches, independent organizations all produce economic forecasts on a very frequent, periodic basis to keep track of the economy - and to know how to deal with it.

Such documents are freely and widely available to the public. So are the underlying data, including economic indicators that are used to keep track of inflation or the Consumer Price Index.

Here's just one example, of myriads -

Here's another:

There are private organizations that do this as well.

I can provide more.

In order to deal with a problem effectively, one has to know what the problem is.

What is harmful in this case is that during a crisis, there should be no politicization of how to deal with it.

Well, of course, except in Ukraine, where politics is no-holds barred, where the politicians are insulated from the effects of the economic crisis, and where the modus operandi is to screech, scream, squeal and piss at one's political opponents every minute of the day - instead of dealing with the crisis.

It is bothersome that Tymoshenko is acting like some kind of a sovok dictator/games player with respect to this memo.

It is bothersome that Victora Baloha, from the President's secretariat, continues to hurl accusations at Tymoshenko, trying to blame a world-wide economic crisis, with effects in Ukraine, on her.

Tymoshenko needs to stop acting like a dictator.

Taras said...

Our feudal system of government uses transparency for feudal purposes.

Yushchenko made a striptease of that memo. Tymoshenko keeps acting like the empress who has no clothes.

That’s the grotesque government we have.

elmer said...

Here is yet another link - to the US Congressional Budget Office, which is set up as a non-partisan entity in order to analyze proposed and actual budgets.

This includes addressing the current economic and financial crisis.

There are links to the publications for the public to see and review.

Taras said...

Thank you for the link, Elmer!

We don’t have that kind of transparency yet, but the Pynzenyk memo seems to have already generated a transparency effect.

Alas, Vice Premier Oleksandr Turchynov, who previously denied knowledge of the memo, has changed the tune.

Having admitted the scale of the crisis, he is now beating the war drums for a police state.

elmer said...

So, Turchynov thinks he's in a war zone, and it's necessary to conduct war against the courts.

What a dufus!

All they have to do is to balance the budget and reform the banks.

But that would eliminate too much corruption, including corruption of Yulia's oligarchs.

As I have said before, in Ukraine, it is impossible to get from A to B.

In order to get from A to B, one goes from A, to H, to M, to D, and continues bouncing around all over the place - but one never gets from A to B.

The sovoks really did a number on the people in Ukraine.

elmer said...

I notice the comments under the article about Turchynov's call to war.

Noone's buying it.g

elmer said...

Has anyone of the general public actually seen the Ukrainian budget?

Is it available anywhere for the public to view?

Why is there a $5 billion deficit?

Does anyone know?

Taras said...

We have a budget deficit of Hr. 31.1B.

elmer said...

Yes, Taras, but why?

Why can't anyone explain - why would it not be possible to balance the Ukrainian budget?

For example, there are the "privileges" that are paid for the benefit of members of Parliament - housing allowance, car allowances, all sorts of other things.

I notice that the Ukrainian budget lists revenues right up front.

Try to find a comprehensive listing of expenditures!