OPINION
IT’S THE BEST TIME TO BUILD THOSE MOTORWAYS (AND MODERNIZE THE RAILWAYS FOR THAT MATTER)
http://www.business-arena.ro
BY OVIDIU CONSTANTINESCU, FACE PR AND NEWS
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Cycling enthusiasts know what I mean: you are happily riding at full speed when, all of a sudden and out of nowhere, a stick finds its way between the spokes and the front fork. The bicycle stops as if it hit an invisible wall, while the rider is propelled forward, tumbling in the air and hitting the ground, crushed by its weight: another one bites the dust. This is precisely the kind of thing that happened to the world economy: out of nowhere, a microscopic THING sends the mighty world tumbling down. Never before has the global economy crashed so suddenly and so deeply. Never before has the crash affected all major economic sectors and never before did they stop working almost simultaneously. Never before did tens of millions of people find themselves unemployed literally overnight. The 2008 – 2010 financial crisis looks like child’s play in comparison with what we are facing now. As for Romania, the economic pandemic could not have come at a worse time: a budget deficit over the EU limit despite economic growth for the past four years, higher and higher public expenditure due to unrealistic growth of salaries in the public sector, a (legal) promise for yet another 20% rise in pensions, a crucial election year, with both local and general
elections. What else can go wrong? Well, something even worse may loom in the future, if the people in power put the short-term electoral gain before the long-term economic rational reasoning. And the signs are not encouraging at all. So far, the government promised milk and honey for everyone: utility bill payments suspended; loans reimbursements postponed; taxes postponed too; financial aid and financial stimulus for various kinds of companies. Is it the right way to buy one’s way out of the current catastrophic situation? Honestly, I doubt it. Mind you, even the electricity companies need money to pay salaries and buy stuff to keep the critical infrastructure up and running. Where do they get cash from? The same goes for gas, for internet, for telephony. And even the dreaded banks, where to they get the money to bankroll the government’s social expenditure or to finance recovery projects? History has shown us that the Romanian government – regardless its political color – is a pretty bad poker player and only sheer and undeserved luck has helped the country to pull through. Right now we are just beginning the game and we really do not know how long it is going to last. Despite not having a clear good hand, we are betting on it, while we don't even have enough cash on the table. Nor do we have someone willing to lend us cheap money until we might get a straight flush or at least a full house. The Romanian government was betting on winning
