Yesterday's article introduced the current political dead-end in Portugal. Today, in continuation we can gather more detailed information about banking rumours and the involvement of the government. So, what are your conclusions?
More unfortunate events
Predictably, and despite the daily media circus, the negotiations were broken by the Socialist Party and no agreement was reached. To the country’s general surprise, the President addressed the nation again. He announced he has accepted the ministerial reshuffle (that had been, meanwhile, on hold) and the show must go on.
But just before the summer holidays officially have begun, for opposition and government alike, a new political scandal made headlines: swap contracts. Making a long story short, swap agreements were initially negotiated between the second Socialist government (2009-2011) and several public companies and, with few exceptions, all represented losses of many euro-millions for the Portuguese state.
Furthermore, as if things were not going bad enough, the new Minister of Finance, Maria Luís Albuquerque and the freshly appointed Treasury Secretary, Joaquim Pais Jorge (who was nominated by the Minister of Finance) faced negative media appearances for different reasons. The first was accused by the opposition parties for not being completely truthful in several parliamentary inquiries, over her knowledge of the existence of the swap contracts. She denied her knowledge, but the former Minister of Finance and other governmental officials from the past Socialist Party publicly declared having informed her during the transition of folders.
The second was, because during the last PS government he was working with the Citigroup Bank which was responsible for several swap contracts. Adding to that, he was not there solely as an intern – he was one of the representatives of the bank in Portugal during the meetings with government officials.
The controversy surrounding swaps was further increased by the current government, alleging that documents had been manipulated and forged in order to incriminate the Treasury Secretary. More precisely, the alleged “forged version” contained an organigram (absent in the original) with the name of the Secretary of State. Some political commentators and journalists noted that this only served as an additional piece of information during the transition of folders between governments. It does not change the fact that the Treasury Secretary did, in fact, hold a position with Citigroup, which is also listed in his Curriculum Vitae.
During a press conference, the Secretary had trouble answering questions posed by journalists regarding his presence at certain meetings. In his interpretation, “not remembering being in a meeting” and “not being in a meeting” mean exactly the same thing.
It is important to underline how the Minister of Finance commented on it at different occasions. She expressed her support or confidence towards the Joaquim Pais Jorge, who finally ended up resigning on the 7th August.
The quality of democratic and public life in Portugal
Portugal has been generally off-radar and absent from European news agencies agenda, even though it is going through yet another "hot summer". This time, however, there are no assassinations, bombings and surely there will be no military coups. Instead, there is a more subtle, nonetheless dramatic feeling of loss of trust in the political institutions and the political class. This reaction by the Portuguese population is the social reality behind interest rates, bail-outs and sovereign credit ratings.
This is the country, where in parallel with popular dissatisfaction and controversy after controversy, the parliament has approved a motion of trust and the government feels empowered to stay on. The country, where one government has an annual budget, ruled unconstitutional twice. The country, where appointed government officials omit certain professional experiences from their official CV. The country, where resignations are rewarded with better “jobs”. The country, where the next municipal elections will be stained by the fact that there are ineligible candidates campaigning, because of different interpretations regarding a preposition, which does not alter the meaning of the law, which intends to limit the number of mandates for mayors to three (twelve years).
There is a natural consequence of this “series of unfortunate events”: the number of candidates with no party affiliation (“independents”) running in the September elections has nearly doubled in comparison to the last electoral act. Whether this is good news, depends on how much one supports the argument that political parties should remain the only main institution of political representation. For my part, I do not.