Shame, fear and pride - notes on exceptionalism II.

The story of IMF loan for Romania rolls on slowly, it is business as usual. The former premier and leader of the opposition National Liberal Party (PNL) attacked the government as faint-hearted people, who will cause a recession with the IMF loan. More precisely with the conditions imposed by the Monetary Fund. Although it is rather a political manoeuver (this year is an electoral one, and Mr. Tariceanu seeks the president's office for himself, although there is a quite difficult path lying in front of him with a popular President in the race), it is maybe effective but not a very sophisticated one. Anyway recession seems inevitable and it is comfortable to find the responsibles in advance. More interetsting is a passage left out from the english version of the news, once again stating that the EU would be ready to act in favor of Romania without the IMF and the last part of the sentence stresses, that the IMF has nothing to do with EU members, as this orgainisation is well known to assist only countries of the third world. Once again national pride prevailing over rational argumentation.
Not that he would be alone with such line of resonong, the prime minsiter and his government is supposedly under pressure from the IMF to raise taxes or abandon the flat-tax system. Theodor Stolojan, a former prime minister and a jolly joker of the Romanian politics never to be used (it is an interesting story but it has nothing to do with the crisis) announced that the flat-tax can be maintened only in case of a widening of the basis of the taxation. But his assessment of the situation was a bit too dependent on if-s and when-s... Anyway, Emil Boc, the head of government immediately take the posture of the heroic defender of the flat tax (there is a shorter English version again..), using the typical argumenttation (so popular in the Baltics regarding the currency peg), that it is an issue of national honor... Although I'm not really convinced that his assertion regarding the falt tax - it was the main driving force of growth in the years preceding the crisis - are true, but at least comprehensible. But treating it as a problem of national pride and accepting unconditionally that the same will be true after the crisis seems a bit unaware, at least for me. (Not to speak of the fact, that in a country where only 0,79 person contribute to the pension of 1 pensioner it is hard to imagine long term political sustainability of a tax system not yielidng benefits for the bulk of the electorate. It can be irresponsible from the perspective of economists, but democracy tends to work this way...)
Once again I'm hardly in a position to decide whether currency peg or flat tax is advantegeous in real terms or at least it has important psychological effects contributing to investment decisions, for example. I even wouldn't dare to say that it is not comprehensible emotionally that in some of the ECE countries such notions and concepts exist. But this kind of argumentation is not leading anywhere in the middle term and sticking to institutions becoming obsolete, only because of some kind of national pride, is a dangerous development, even though it can be understand from a different perspective.

Update 1: Here is a nice collection of the different opinions and reasonings, unfortunately in Romanian...