Out of debts came capitalism

The best, biggest and most profitable deals are made with the state. This is what every major businessman knows, a phrase they have pinned on the wall, as a perpetual slogan.

The statement is universally applicable in any country, so we shouldn’t be complaining. A more or less significant bit of wealth does come from dealing with the state.

The state always pays, it is the most lenient creditor, so why wouldn’t everyone try to do business with it? One paradox of the capitalist world is that some businesspeople, 100% private, are the most interested in maintaining large state-owned structures, because they can thrive by becoming one of the many suppliers. Suppliers “to the royal court.”

Take the most famous cases in Romania: Petrom, Romgaz, Sidex, state banks, and everything else classifiable as “national interest.” Many a businessman prospered on their account. How would anyone in the world want these state firms to become private? The first to oppose are the businesspeople themselves, because one of the most capitalist concepts of the Romanian society applies here. Profits are privatised, losses are nationalised.

The scandal of Ordinance 95, on the payment of budget obligations owed by economic agents who will supply products and services to public institutions involved in national defence, public order and national safety, qualifies as one of the most capitalistic concepts in Romania. That is, companies indebted to the state can deliver products in exchange for their debt. What you have to do first is make a lot of debt, and the state is the most “generous” in these terms. It lets you grow debt, and then compensates you. The state doesn’t erase debt, it compensates it, that’s the Government’s official phrasing to explain Ordinance 95. It’s a nuance, isn’t it? Overnight, some firms turn from debt-ridden to wealthy. With help from the state. They’ve sold all their products on stock. And skipped the queue, to be sure.

The scandal of the Ordinance reveals how ministers can shake hands when it comes to helping companies’ capitalism prosper. And it shows something else. That between the Government and the Official Gazette there is a long way for a law. Great scores are pulled and the wealth of many is decided here.

To approve something in Government, and have a bit of something extra printed in the Gazette. It takes a lot of nerve and party support to change or add something in an official Government paper. It’s unlikely that humble officials made these changes. They only carried out orders.

Prime Minister Mugur Isarescu recalls having accepted a list of companies eligible for this compensation, but, pending publication in the Official Gazette, the list happened to “grow.” Just like that! Did these companies just add themselves to the list? That cannot be done.

The second problem is that some companies have said their place was not there, because they have no debt. Whoever added them to the list mocked not just them, but the Government and Premier Isarescu, too. In the most direct way, with documents up to date and with every signature in place. Not to mention the premier’s delicate position before international financial institutions, with which he has struck, if at least verbally, a lot of arrangements.

Perhaps the ordinance is right because it breathes fresh air into some companies, as the Government says. But it breaches many other principles. Or better yet, it promotes a new one: mount debt to the state and get a better chance of striking it rich. The state will compensate you, rest assured.

Capitalism and the condition of businessperson are a genuine adventure that begins and ends with the state. And one of the great truths, which life underscores even more boldly, is that… debt is what capitalism is made of. In Romania, of course.