Dragotescu Questions Proposed Wage Slave Law


Just recently I was complaining to The Woman that there aren’t enough journalists in Romania doing a good job at actually, you know, being journalists, digging into secrets, asking tough questions and writing well-researched pieces. Looks like I definitely spoke too soon!

Corina Dragotescu

Yesterday during an otherwise “boring” press conference, the journalist Corina Dragotescu got Traian Basescu on the ropes, peppering him with questions, causing him to completely flip his wig.

So far this story has only appeared in the Romanian (language) press, so all the translations below were done by Yours Truly, and therefore any errors are mine and mine alone.

If Romanian is your first language, you can read the text of the press conference here, a brief analysis of Ms. Dragotescu’s participation here and a somewhat hyperbolic analysis of the whole thing here (which clued me into this story).

First, however some background. The issue here is what in Romanian is called the Noul Cod al Muncii, which I have translated as “The New Labor Law”. If you’re British or Australian or Canadian, just pretend there’s a “u” in Labor ;)

I’ve never held a job in Romania but I know lots of people who work here and essentially, like most European countries (“western” or “eastern”), workers have a lot of rights. They get compensated for injuries on the job, illnesses and for being fired or laid off. They get guaranteed vacations and certain rights concerning how and when they can be fired (or hired). Romanian workers also “earn” a future pension (or “retirement money”) based on how much money they make at their jobs. Furthermore, all (legal) jobs consist of a contract between the employee and employer, stating in (remarkably) clear language the terms of their employment.

The long and short of it is that Romanian workers are fairly well-protected at the moment. The “New Labor Law” is a proposition that’s unique in Europe and eerily resembles the indentured servitude laws under which I slaved away for many years in the United States.

What I’m translating as “black market” jobs refers to people who have jobs but are not legally “hired”. That is to say, no contracts are signed, no vacation days are earned, no future pension payments are accrued, etc.

I’ve skipped over some of the text concerning other issues like Schengen accession and a long-winded passage about how the United States’ productivity levels are so much higher than in Romania or anywhere else in Europe. There are also some related issues mentioned (such as union contracts, etc).

From the press conference, speaking about Romania’s labor force. All bolding and other formatting is my doing:

President Traian Basescu: We have a uniquely attractive value [the labor force in Romania] but a labor market that’s extremely rigid. It is not just this rigidity that makes us less attractive but it also puts burdens on the workforce. Currently we have a huge deficit in the [government-run] pension funds, for example. Therefore the solution is to increase the number of workers, to make the workforce more flexible, which will allow us to reduce the burdens on the labor market.

Concerning this, what I must tell you is that it is essential that we adopt the New Labor Law. I do not want a confrontation, nor do I want to seem like an expert in these matters – there are others who are much more knowledgeable about the problems concerning the workforce in Romania than I – but I know of what I speak.

We have the advantage of having a work force with a unique value and therefore we also need a flexible Labor Law that will permit employees to hire a fluctuating work force on one hand and on the other hand will allow those who are looking for work a lot of options. Thusly, using the new Labor Law we can regulate this, legalizing temporary workers.

We must adapt labor contracts to suit the needs of economic agents and the requirements of theoretical options which no longer address Romania’s need to become attractive to investors. I do not wish to go into detail about the specifics of the new Labor Law but I must tell you that I know them quite well.

We could discuss, amongst other things, and I don’t know if you all remember this, but in 2009 the European Council launched a new concept: “flexible security”. This refers to making the labor force more flexible to give employees a chance to find a job more easily, that is to say a job for a limited period, or in other words being temporary employees, but it is also about hiring for longer periods, and the adaptation of employers to two essential things: the needs of the employees and the interest of the employer.

…We need the new Labor Law to address two fundamental interests: the employer, who spends and risks their money, and the employee, who needs a job. I believe that the new Labor Law exactly addresses these issues. I have heard absolutely ridiculous statements about this, talking of the “introduction of slavery”. This isn’t true. The employee will remain protected and the employer will be able to protect their their business. But if you all really want to, you can debate it as much as you wish.

I also want to stress that I don’t want you to misunderstand me and think this is about eliminating unions. But the project, the project of implementing a new Labor Law, I will spell it out very clearly to you: union bargaining agreements on the national level [and some other issues] will not be addressed by the (new) Labor Law. These will be addressed via other existing laws [blah blah].

The Labor Law establishes the relationship between employer and employee and nothing else. I believe that when the new Labor Law is eventually adopted, it will begin eliminating “black market” jobs, which are an alarming proportion of the current job market in Romania.

Indeed the primary reason that black market jobs exist is because of the lack of flexibility in the [current] Labor Law. Employers are currently hesitant to hire temporary workers because they must sign a [long-term] contract with employees. If they need to complete a project for a few months, employers [currently] prefer to hire “black market” workers because otherwise they must go through all the difficulties that come with hiring a full-time worker with a collective bargaining contract.

It is incorrect to say that full-time workers will be the most vulnerable under the new Labor Law. They are vulnerable right now because of what happens with the approximately 1.6 million Romanians who work at both part-time and longer-term jobs, many of them without a proper labor contract. This is a risk to their future.

Employees without a labor contract don’t pay social security, nobody contributes to the pension system, and nobody will pay if there’s an injury on the job. Therefore I believe we need to be realistic about what we must do. In the first place, we need to make Romania more attractive, and it is attractive already, because of our labor market, which is second after Poland in the region, third amongst European Union members if we also include Ukraine. That is to say, Romania is an important labor market and can be quite attractive but we must do everything possible to be attractive to investors.

All of this is what I wanted to tell you all about today. I have involved myself somewhat with the terms of the Labor Law because this was the topic, as I’ve outlined today concerning the problems of the labor market. And it is a fundamental subject as we look to our own future needs. Indeed it is important to make the Labor Law and the Romanian labor market more flexible.

I’ll take questions now.

Corina Dragotescu: I have two questions. The first concerns what you said, that salaries will be tied to productivity.

Basescu: That’s the proposal.

Dragotescu: Logically speaking, that means salaries won’t increase if productivity doesn’t increase.

Basescu: Mrs. Dragotescu, if you know another way to…

Dragotescu: No. First I wanted to verify…

Basescu: If you’ve understood what I’ve said.

Dragotescu: Yes, that’s what I want because you know it’s difficult for me to grasp.

Basescu: I don’t doubt it.

Dragotescu: I want to ask you concerning these conditions of the new Labor Law, don’t you think that this will prompt a new migration in the labor market, further worsening the imbalance that currently exists in the [government-run] pension funds? Realistically speaking, we won’t really have more people working but more retired people. This question is because of what you said about…

Basescu: Ma’am, this is your interpretation. If that’s what you think I said, I’m telling you that you didn’t understand a word I said therefore there’s no point in answering your question.

Dragotescu: No, that’s the logical conclusion based on what you said.

Basescu: I spoke very clearly: flexibility in the labor market will give many more people a chance to get a job. If you want to twist my words around, be my guest! But I told you very clearly…

Dragotescu: No, I am responding logically to what you said. If salaries do not increase, people will go somewhere where salaries are better.

Basescu: Mrs. Dragotescu, thank you for your questions. I’ve given you my response. You have nothing but a question. Thank you very much.

Dragotescu: But you didn’t answer my question.

Basescu: My response is the following: you don’t understand what I said. The new Labor Law, if it is adopted, will create many new jobs because employers will be able to hire temporary workers. Knowing there are no more difficulties in signing contracts for unspecified periods of time, employers will be enticed to open companies to hire people, temporary workers, and so on and so forth.

Dragotescu: But I am asking you about what you said, sir, about tying salaries to productivity levels.

Basescu: Mrs. Dragotescu, thank you so much. I have given you my response.

[other questions by other people on a variety of topics]

Dragotescu: Still on the subject of the Labor Law, Mr. President, how do you explain that this Labor Law, this new project to make the labor force more flexibile and to eliminate black market jobs, how do you explain all the opposition by the unions and organized labor? And how do you explain the fact that the only one, besides the government itself, in support of this new Labor Law is the Romanian-American Chamber of Commerce? Thank you!

Basescu: Jeez, you know I figure it? The same way that some 80% of the military, when they had their pensions increased still whistle and jeer when the national anthem is played, just as if their pensions were reduced. The same way everyone says their pensions were reduced but starting on January first Group 1 and 2 pensions were increased. A kind of strange fervor and disinformation coming from the leaders, those in the Army, those of the unions, appear on television shows that specialize in these feverish displays. I’m referring to the shows “Trustul Realitatea” and “Intact”.

Dragotescu: Can I ask a second question, even if you don’t answer? Because I have some colleagues here for whom you’ve answered a second question.

Basescu: Mrs. Dragotescu, I cannot refuse you a second question because I see you’ve waited your turn in line.

Dragotescu: Thank you very much for noticing, because I am quite disciplined.

Basescu: And I am aware of…

Dragotescu: Of women’s self-discipline, I know.

Basescu: Even if you were a man, we wouldn’t give up…

Dragotescu: That’s what I’m saying – self-disciplined women will like it. Mr. President, I wanted to know if the current Prime Minister’s skill set addresses Romania’s future needs? You mentioned the fact that the deadline of April 1 exists to put forth the proposal and the protection – the budget proposal – with a three year projection. You mentioned increasing surveillance of macroeconomic imbalances. Are you saying that there is a need to concentrate further on other issues before we address financial ones?

Basescu: Competitiveness!

Dragotescu: Exactly! Do you believe that the current Prime Minister’s current skill set addresses Romania’s future needs? I ask about the immediate future as well as the next three or four years down the road, if you like.

Basescu: Ma’am, you’re bringing up a personal issue and I’m sorry but you know that in Cotroceni [the Romanian “White House”] we don’t involve ourselves in the kind of speculations you’re making. Good day!

Dragotescu: Thank you!

Basescu: Good day! This is probably par for the course where you work. But here we demand decorum. Your presence here obliges you to a higher standard of decency, ma’am!

Dragotescu: Mr. President, how has my question offended you? I only asked if the skill set of the current Prime Minister… a man who specializes in legal issues, corresponds to what you sir, have stated.

Basescu: Mrs. Dragotescu, you know very well what you said and what you have done. You know very well what you said and what you did. If you want to be vulgar, don’t be here. Next question please, if there are any more questions.

[other questions by other people on a variety of topics]

Later in the day, Corina Dragotescu appeared on Realitatea TV wearing a bright red wig just to show that she could be vulgar ;)

A lot of issues were raised in this press conference but you can see that Dragotescu got under Basescu’s skin, particularly on the subject of the Labor Law.

The last little jab there on the subject of the Prime Minister was referring to some inside baseball that’s a little too complicated for me to get into at the moment.

I will tie together this article with some other things I’ve been working on in a future article. There’s absolutely no way to know if the new Labor Law will be implemented the way Basescu is advocating. It looks like several of his political opponents are threatening to dissolve the parliament if this happens.

What I can tell you is that it is remarkable just how testy Basescu was on this subject and how interesting it is that it seems to be the brainchild of the Romanian-American Chamber of Commerce, the same bastards who worked so hard to get Ceausescu’s highly indebted dictatorship Most Favored Nation status in the 1970’s and 80’s.

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13 Comments Add yours

  1. Mihaela says:

    Finally, I have read the new law. It’s here: http://www.hotnews.ro/stiri-esential-8344715-guvernul-reuneste-sedinta-ora-10-00-cel-mai-probabil-adoptat-noul-cod-muncii.htm
    I have also found few articles which summarize the differences between the old and the new law, like this one:
    http://www.cogitus.ro/administratie/codul-muncii-2011-principalele-modificari
    As everybody can see, the system is roughly the same. There are only few changes, important, but not so important to justify all this war against the law. And definitely there is no need for a passionate discourse à la Realitatea TV, Antene & OTV…

    Like

    1. Sam R. says:

      Thanks. Soon as I heard on the radio this morning that they were going forward with it, I promised myself to look for the full text. MUCH APPRECIATED

      Like

  2. Daniel says:

    Aaaah, nothing like engaging in left-wing intellectual masturbation. Nothing like throwing around words like “wage slave” with nothing to back them up, eh ?

    Oh, and that article by Cornel Ban, the “Brown University professor” ??
    An ignoramus who has no idea what inflation is or how it happens, yet feels confident enough to pass judgement.

    And a question for all of you – if economic freedom (which Romania obviously does not need, if I’m to believe what the people around here are saying) is not correlated with prosperity, how come Romania’s doing so bad ? Can’t be only those evil furriners keeping us down, can’t it ?

    Like

    1. Mihaela says:

      Vorba bancului: si tu ai dreptate! Aaaah, aurea mediocritas!

      Like

  3. fLoreign says:

    From what I’ve seen, this is a part of Basescu which can be explained mainly by two factors:
    – think about the political context when he was elected. Yes, Republicans, now the champions of shutting down unions all across the US. He is indebted to a certain extent (and there must be some ongoing friendship going on there) to them, to a certain approach, considered “truly American”, as opposed to Socialist.
    – the business contacts he has : think Smithfield. These friendships of his were not static, but moved into the Romanian landscape. Obviously, these business persons brought with them in Romania “the neo-protestant ethics and the spirit of ultra-capitalism”, to paraphrase Max Weber’s work.

    I see where you are coming from, on the other hand I also see what can be done. Probably the economic and political isolationism could have been the only alternatives, and frankly even under the wavering (and fake) Iliescu, who did not make steps toward EU and US (but rather to Russia, and here’s the historical curse, you have to choose which side you’re on, and I’m definitely in the same camp with Basescu on this one), things did not go any better, but on the contrary, the elite was uncontrollable, and of a post-Soviet model.

    This is the strangest misalignment to see for someone watching in parallel Romanian and American politics: a reformist Romanian president, who has ties to the conservative US wing. Both these have specific causes and curiosities. First, Romanian economy did not recently experience the full-blown private economy boom, the kind which ruled US for quite a while, and is still not very well developed in Ro. And second, OTOH, the Americans (or some of them) have a strange amnesia when it comes to the causes of last recession: it wasn’t the unions or Obama, but the well-developed private sector. Now what to do? Unfortunately even the unions in Romania are not what they’re supposed to be.

    For this last part, here’s an article written by a Brown University professor, directly in Romanian: http://www.contributors.ro/dezbatere/pentru-munca-sindicalizata-motive-nediscutate/

    Like

    1. Sam R. says:

      Damnit, you just reminded me I have an old copy of TAROM’s magazine somewhere around here because I wanted to write an article on Smithfield. I was dismayed to learn that the woman who brought those devils here is from Cluj.

      Like

    2. Mihaela says:

      @ fLoreign
      I subscribe to your comment. I hope Sam R. will take it seriously. He doesn’t need to follow Corina Dragotescu & co, in order to keep his crown as King of Romania… :)

      Like

  4. Mihaela says:

    The comparison with the space station is very nice, but not when it comes to social behavior. Ask a sociologist.
    Your argument “Basescu family” is a locus in the discourse of the opposition. What about Nastase family?! And all the other families that gravitate around Romanian politics, no matter if it’s left or right?! I do not consider myself “orange” and I have no intention to praise Basescu, but I am worried to see the Manichean trap that most of the people are ready to embrace.
    The only mission of the opposition is under the slogan “Jos Basescu!” And what? What it will happen after Basescu leaves? Do they have a real plan for the country? They compare Basescu with Hitler?! Do we really have to subject ourselves to this aberrant rhetoric? Because that’s what Realitatea TV does and that’s what Antena does. Until recently, Realitatea TV was under the total control of Vantu (a criminal) and Antena is under Voiculescu’s control (a proved “securist”). Vantu and Voiculescu have declared open war to Basescu and people still think that those two “moguls” are right and actually Basescu controls Romanian media.
    Fortunately, there are some people who try to get out of this cheap Manichean vision (http://www.contributors.ro/editorial/reteta-pentru-noul-partid-cati-v-ati-baga/). Unfortunately, I am afraid that their number is not enough to help the country get out of the hands of left & right corrupt politicians. Most of Romanians would rather believe in the violet flame than learning from history. They have even forgotten the recent history…

    Like

  5. Ayceman says:

    Mihaela: Just because the present set of regulations isn’t enforced sufficiently isn’t an excuse to remove worker’s rights. It’s like saying that because the O2 supply on a space station is insufficient, the supply should be shut down. The situation is as simple as the govt. stepping down already and letting the replacements reduce the financial burden to encourage people to start contributing at a rate similar to the pre-2008 period, after which the rate of evasion dramatically increased.

    The problems in the system have always been there, but they have been exaggerated by 3 factors now:
    1. The crisis hitting us in our most vulnerable moment debt-wise.
    2. More uncultured and shady people (including confirmed criminals and murderers) getting into govt. and related state institutions on the back of the PD-L, which needed to acquire a strong territorial structure, and floating around the Băsescu family.
    3. The huge financial strain of pulling off a (fraudulent) win in the last elections, where the beneficiaries greatly indebted themselves to a lot of people that are now lobbying (aka blackmailing) them to implement legislation that serves their interest. Some of these interests were American => the American Chamber of Commerce providing support for this code.

    This situation does have a good side: it provides a serious shock to the system (the people that will replace the ones currently in power will be forced to include real experts and let them do their job to provide for a few years of real stability) and the people (they’ll be more careful about who they vote for in the next decade of so – less voting for a bottle of cooking oil, for being an ass, for using election themes that have long passed their period of relevance and have a tabloid-like shock value).

    As for journalism: It’s true that Romania has very few really good interview journalists, especially among the reporters. She posed a simple, but really annoying question and stuck to it. The way he reacted, even if it doesn’t include a real answer, is enough to realize that the “it will encourage employment” spin is a load of BS. I’m a bit worried about the good journalists of the Realitatea Trust. This is because the current program director has state contracts. Last week, without warning, the most watched show of Realitatea TV, Ora de Foc (Fire Hour) was canceled in the middle of the week at noon. The moderators stated on Antena 3 this week that they believe it was on command from high up. They are good journalists that know how to get to people that are lying in their faces. The show that probably prompted this canceling was the one where Sorin Blejnar (head of ANAF – the Romanioan IRS) was accused by court evidence and declarations by an ex-customs worker and the head of the a major opposition party (PSD-Victor Ponta) of being the head of a nation-wide smuggling and tax-evasion ring dealing primarily with border trafficking. He would be the guy at the end of a chain (or close to it’s end) that starts with the ordinary customs officer that collects €3,000-€20,000 a day in bribes. Blejnar’s nervous intervention on the air indicated even more that he was involved, and he inadvertently revealed some of his breaches of procedures and of the law while acting as head of ANAF.

    Like

  6. Mihaela says:

    Firstly, for the reasons that I am not going to discuss here, Corina Dragotescu is not the best example in the Romanian journalism. Sorry…
    Secondly, the new labor law tries (I am not saying that it will perfectly succeed!!!) to eliminate the black market jobs. Under the actual law, people have rights ONLY on the paper. Practically, there is no respect for that law. Just an example: many people are “convinced” by their employers to sign contracts with the minimum wage. That also means minimum benefits, less taxes, etc. What it is kept “secret” is that the employee will get more money, under the table. So, let’s say, on my contract I get 670 lei per month but, in real world, my boss is going to pay me 1200 lei per month (I can tell your for sure that this method works in Poland and other ex-communist countries, too). It sounds fun, your boss helps you cheat on taxes (your boss pays less taxes too!). The sad story is in the whole black economy, which is not something that any country would be proud of. And you will personally feel the moral of this story when you get the smallest pension ever (because that is your “right”, according to your work history) and than you have to pay the medicines from your own pocket, although you have access to free healthcare.
    Thirdly, I did not see ANYBODY trying to contribute to improving the new labor law. All people do is to emphasize its flaws in order to conclude that the government&president “camarilla” is working on destroying the country. Dragotescu is just one of those people. I am not interested in this kind of discourse.
    My question is: what is better, to have a less-protective law that most of the people would tend to respect or an ultra-protective law that NOBODY respects?

    Like

    1. Mihaela says:

      I can reply to Corina Dragotescu’s question about why the unions don’t like the new labor law, but I have a feeling that she just pretends not knowing the answer.

      Like

  7. Filozofu' says:

    Indeed, Basescu is an embarrassment. Everybody knows that.

    Like

  8. Andy Hockley says:

    Basescu appears to me a man entirely trapped between his desire to appear statesmanlike and presidential, and his sense that he is seen as a man of the people. So he ends up with this bizarre self-parody persona which is somewhere in the middle and which fails at both ends. A prototypical Basescu speech would go: “Ladies and Gentleman, phhwoooar look at the tits on that, nudge nudge wink, know what I mean guys, I am here tonight to talk to you all about Romania’s standing in the world”

    Even George W Bush couldn’t carry this “President Thickbloke” thing off, and he had a compliant and slavish media. Basescu is just an embarrassment.

    Like

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