"Olukorrast riigis": State lacks projects for quick investments
Journalists Andrus Karnau and Harry Tuul discussed the government's issue of long-term debt instruments on Raadio 2's "Olukorrast riigis" talk show, finding that the state lacks projects where quick investments could be made.
The government is debating what to do with 50,000 coronavirus rapid tests worth around €450,000 donated by businessman Parvel Pruunsild. Karnau described it as baffling that the issue has landed on the government's desk as the decision could just as easily be made by a ministry department head.
Tuul said it raises questions when the government is discussing adopting tests picked and donated by a specific businessman, considering that the Health Board says a reliable or certified rapid test doesn't exist. "Accepting half-baked things creates a lot of noise, false positives and negatives," Tuul said.
The hosts discussed Estonia's decision to borrow a billion euros by issuing long-term government bonds. Karnau said that one problem is that the state does not have enough projects were rapid investments could be made. "The government might say that it is willing to borrow because state investments help liven up the construction sector and overcome the recession," he said.
"But if we come to the Saaremaa bridge, for example – that sounds great, could create a lot of local jobs and even attract a foreign main contractor, considering the size of the project – actual construction work could begin when the state has long since recovered.
"Planning takes 4-5 years, and by the time they get to construction or the point where the money starts coming back to the economy, we could have a new boom and it could have a negative effect for the economy instead," Karnau said.
Tuul said that while having a countercyclical fiscal policy is all well and good in theory, no agency is ready to adopt it. He gave the example of four-lane highways that do not even have a preliminary plan at this stage. The journalists agreed, however, that borrowing to maintain standard of life is the correct path instead of opting for austerity measures.
The hosts also discussed the EU's planned joint loan. Tuul said there have been skeptical voices also from the opposition and politicians are waiting to gauge the public's reaction. He said that European officials see it as a life raft for the European project.
Karnau and Tuul also discussed the €50,000 donation by Jana-Helen Juhaste to the Center Party. Karnau said he would like to know whether the bank took no interest in the origin of the money and why would a person who has never donated anything to the Center Party suddenly cough up €50,000. Tuul agreed that such events could raise questions in today's strictly anti-money laundering climate.
He said that it is an established practice among businessmen who want to remain anonymous to have their friends make donations to political parties. However, donating through someone who is unknown and not wealthy is not exactly wise.
Juhaste was previously a member of the Conservative People's Party (EKRE). Businessman Ivar Vendelin's €100,000 donation to Center from last year also raised questions. Karnau said that newfound right-wing sponsors may suggest the Center Party's ideology is leaning toward the radical right and national conservatism since the formation of the current government.
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Editor: Marcus Turovski