A Call for Debate on Political Decentralization in Ukraine If done right, decentralization can be a great solution for Ukraine

‘Living together in diversity. Learning to accept our differences’  At the entrance to Higashi Honganji Temple in Kyoto, the ancient capital of Japan

Political and economic decentralization is the immediate systemic change needed for Ukraine to become a  stable and healthy democracy. Democratic regional decentralization would have three important and distinct  benefits for Ukraine's nascent democratic institutions.  1.

2.

3.

It would be an effective guarantee that important local economic and social decisions are made by the  people most affected by these decisions, rather than being dictated by whichever party comes to  power in Kiev.  It would reduce the stakes in the conflict in national politics and help focus attention not on whether  one region will impose its will on another, but on the urgent economic and political problems facing  Ukraine.  A vibrant local democracy would do much to strengthen Ukraine's national political institutions and  provide a forum where new local politicians can prove themselves, gain the trust of the people and get  executive experience.

By contrast, the system currently in place, in which local officials are appointed by a centralized, national  authority that often ignores broad interests, prevents any renewal or evolution of the political parties that act to  integrate political elites at various levels of government, and does not offer sufficient protections or  representation to regional interest groups. Instead, political evolution can only express itself through recurrent national and regional mass protests and  Maidans, and skirmishes over regional control. Such mass movements surface new political leaders who are  subsequently overwhelmed by the entrenched system in place. Mass movements undermine the evolution of  the democratic process, generate instability, and provide no assurances to losing or minority parties.  Meanwhile new leaders succumb to corrupt reactionaries, and on occasion evolve into dictators themselves,  creating the vicious cycle. The view "done right, decentralization can be a great solution for Ukraine" is representative of the sentiment  among many academics in Ukraine and in the West. A debate about the merits of decentralization and further  institutional reform should be an important priority in these extraordinary times. A succinct and spot­on perspective was offered by Roger Myerson, Nobel Laureate in Economics, 2007, on  February 24, 2014. Dr. Myerson notes the importance of weakening the power of the center and the  importance of local representation in the choice of regional leaders. The recent appointments of local  governors in the east of Ukraine, intended to allay concerns in the regions, indicate that the Kyiv government  recognizes the importance of decentralization for the future of united Ukraine: “Democracy   is  about  voters   having  a  choice  among  alternative  candidates   whom  they   can  trust  to  exercise  power  responsibly.  When  such  trusted  leadership  is  lacking,   democracy   is   inevitably   disappointing  and  fragile.  A   presidential  election  can  give  prestige  to its   winner,  but  it  does  nothing to 

develop  the  broader  supply   of   trusted  alternative  candidates  on  which  the  success   of  democracy  will   ultimately   depend.  This  essential   supply   of   trusted  democratic  leadership  can  develop  best  in  responsible  institutions  of  local  government  where successful local leaders  can prove their qualifications  to become strong competitive candidates for higher office. Do  people  in Ukraine feel frustrated by a scarcity  of  candidates  who have developed good reputations  for  exercising  power  responsibly  in  elected  office?  In  other  countries,   trusted  candidates   for  national  leadership are regularly found among governors  and mayors who have proven their abilities by delivering  better public services in the government of a province or a large city. But  the  Сonstitutions  of  Ukraine have  given  the  President  the power  to  choose  all  provincial  governors.   The  incumbent President is  the national politician who would have the most to lose from  the development  of  more  trusted  competitive  candidates   for  national  office.  Under  this   constitutional  system,  we  should  expect  provincial  governors  to be regularly   chosen  from  among the President’s  loyal supporters who are  unlikely to develop any independent reputations of trust with the voters. The  transition  to an independent  democracy  in Ukraine was  never going to be easy, but  I  believe that this  deeply   flawed  constitutional  structure  was   also  an  important  contributing  factor  that   people  should  recognize  and  try  to change.  The  best  hope  for developing trusted  democratic  leadership would be from  decentralized  local  politics  in which governors   are  ultimately  responsible to the  local  voters  within  their  province.  Some  who  hope to gain national power might  be tempted by  the prospect of  appointing dozens   of  supporters  to  powerful  local offices   throughout  the  country.  But  those  who  truly  want  to build a strong  competitive  democratic  system  in  Ukraine  should  consider  supporting  constitutional  reforms  that   would  decentralize some share of responsible power to locally elected leaders in each province. Locally   elected  councils  already  exist  in  each  province  of  Ukraine.  A   constitutional  reform  to  give these  local  councils  the  power  to  choose  their  own  governors   could  be  a  vital  step  toward  easing  regional  tensions and building stronger democracy in Ukraine” Decentralizing the choice of governor to the provincial councils or to provincial voters would not imply  federalization, as the Verkhovna Rada of Ukraine would still have significant national powers over the  provinces, including (under Article 75) monopoly on legislative authority and (under Article 85) powers to call  special elections for bodies of local self­government and to change district boundaries.  This decentralization  would, however, empower local authorities and remove secessionist pressure. The merits of decentralization are clear, but any decentralization effort should be undertaken with great care.  Careful implementation with rigorous debate is needed: ● decentralization must be implemented to serve to unite Ukraine and encourage a celebration of  diversity of the Ukrainian nation; ● local authorities will be at risk of being corrupted by the vestigial establishment; ● local officials must be granted the authorities and resources needed to fulfill the responsibilities they  are assigned; ● level at which decentralization should take place ­ roles and responsibilities of local, regional, and  national authorities must be carefully delineated and socialized; ● safeguards to assure appropriate checks and balances between regional and national interests, as  well as between various interest groups, must be in place to overcome the risk of dominance by one  local authority or interest group, to which the country has become accustomed.

Signed Ukrainian academics, economists, and lawyers 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21.

22. 23. 24. 25. 26. 27.

Yuriy Gorodnichenko, PhD, University of  California, Berkeley Tymofiy Mylovanov, PhD, University of  Pittsburgh Andriy Norets, PhD, University of Illinois at  Urbana­Champaign Igor Sanzharovskyy, PhD, EBED Ukraine Myroslav Pitsyk, Cand. Ph.Math.Sci,  Association of Cities of Ukraine Borys Dodonov, PhD, NoSEP Irina Akimova, PhD, NoSEP Dmytro Boyarchuk, MA, CASE Ukraine Dmytro Yablonovskyy, MA Dr. Oleg Zagnitko, LL.M., Ph.D, Ukraine Olena Nizalova, PhD, Kyiv School of  Economics, Kyiv, and University of Kent Denys Nizalov, PhD, Kyiv School of  Economics Alex Nikolsko­Rzhevskyy, PhD, Lehigh  University Oleksandr Talavera, PhD, University of  Sheffield Andriy Zapechelnyuk, PhD, University of  Glasgow Oleg Korenok, PhD, Virginia  Commonwealth University Dmytro Hryshko, PhD, University of Alberta Maxym Chaban, PhD, University of  Saskatchewan Andriy Bodnaruk, PhD, University of Notre  Dame Sergiy Pysarenko, MA, University of Guelph Oleksiy Kryvtsov, PhD, Assistant Chief of  the Model Development Division in the  Canadian Economic Analysis Department Anna Nesterenko, PhD Zoya Mylovanova, LLM Natalia Tovstopyat, MA Oleksandr Demchuk, MA Dmytro Zhosan, PhD, Ripon College Vadym Volosovych, PhD, Erasmus 

Western and Russian academics 1. 2. 3. 4. 5. 6. 7. 8.

9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20.

21. 22. 23. 24. 25. 26.

Roger B. Myerson, PhD, 2007 Nobel Prize  in Economics, University of Chicago Vernon L. Smith, PhD, 2002 Nobel Prize in  Economics Daron Acemoglu, PhD, MIT Gerard Roland, PhD, University of  California, Berkeley  Sergei Guriev, PhD, New Economic  School, Moscow, and Sciences Po, Paris  Konstantin Sonin, PhD, Higher School of  Economics, Moscow Victor Chernozhukov, PhD, MIT Paul Roderick Gregory, PhD, Hoover  Institution at Stanford and University of  Houston Daniel Treisman, PhD, University of  California, Los Angeles Jenna Bednar, PhD, University of Michigan Antonio Merlo, PhD, University of  Pennsylvania Jan Svejnar, PhD, Columbia University Julliet Johnson, PhD, McGill University Scott Gehlbach, PhD, University of  Wisconsin ­ Madison Timothy Frye, PhD, Columbia University  Peter Ordeshook, PhD, California Institute  of Technology Charles Becker, PhD, Duke University Michael M Ting, PhD, Columbia University John Londregan, PhD, Princeton University Ruben Enikolopov, PhD, Universitat  Pompeu Fabra, Barcelona, and New  Economic School, Moscow Dan Berkowitz, PhD, University of  Pittsburgh Jim Leitzel, PhD, University of Chicago Cesar Martinelli, PhD, ITAM, Mexico Steven Callander, PhD, Stanford University Hanming Fang, PhD, University of  Pennsylvania Bent Sorensen, PhD, University of Houston

28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41.

University Rotterdam Svitlana Taran, MA Anna Serdyuk, PhD, Investment  Management industry, Edinburgh, U.K Viktoria Shum, MA Yuliya Demyanyk, PhD Olga Pindyuk, MA, Vienna Institute for  International Economic Studies Oleksandr Zholud, MA, ICPS, Kyiv Natalia Shapoval, MA Dr Volodymyr Bilotkach, Newcastle  University Eugene Milovanov, PhD, Organic  Federation of Ukraine Bohdan Kukharskyy, PhD, University of  Tübingen Roman Sheremeta, PhD, Case Western  Reserve University Svitlana Maksymenko, Ph.D., University of  Pittsburgh Oleksandr Shepotylo, PhD, Kyiv School of  Economics Sergey Sanzhar, PhD, VP at Citigroup, UK

27. Erik Snowberg, PhD, California Institute of  Technology 28. E. Glen Weyl, PhD, University of Chicago 29. Mattias Polborn, PhD, University of Illinois  at Urbana­Champaign 30. Hulya Eraslan, PhD, John Hopkins  University 31. Nathaniel Wilcox, PhD, Chapman  University 32. Marina Azzimonti, PhD 33. Mallesh Pai, PhD, University of  Pennsylvania 34. Guido Friebel, PhD, Goethe University,  Frankfurt 35. Mark Daniel Bernhardt, PhD, University of  Illinois at Urbana­Champaign and  University of Warwick  36. Victor Ginsburgh, PhD, Université Libre de  Bruxelles 37. Arnaud Dellis, PhD, Laval University,  Quebec 38. Alessandra Casella, PhD, Columbia  University 39. Arianna Degan, PhD, Université du Québec  à Montréal  40. Zvika Neeman, PhD, Tel Aviv University 41. Bard Harstad, PhD, University of Oslo 42. Maria Luengo­Prado, PhD, Northeastern  University 43. Al Slivinski, PhD, University of Western  Ontario 44. Moira Daly, PhD, Copenhagen Business  School 45. Irina Murtazashvilli, PhD, Drexel University 46. Richard E. Ericson, PhD, East Carolina  University 47. Evgeny Finkel, PhD, George Washington  University 48. Juergen Wolters, Prof (emeritus) FU Berlin 49. Jon X Eguia, PhD, New York University 50. Richard Van Weelden, PhD, University of  Chicago 51. Keith Darden, PhD, American University 52. Serguey Braguinsky, PhD, Carnegie­Mellon  University 53. Jorge Soares, PhD, University of Delaware 54. Gaurab Aryal, PhD, University of Chicago

55. Orhan Torul, PhD, Boğaziçi University 56. Ross Hickey, PhD, University of British  Columbia, Okanagan 57. Dimitri Landa, PhD, New York University 58. Cathy Hafer, PhD, New York University 59. Ugo Panizza, PhD, the Graduate Institute,  Geneva 60. Camilo Garcia­Gimeno, PhD, University of  Pennsylvania 61. Matt Shugart, PhD, University of California  Davis  62. Navin Kartik, PhD, Columbia University 63. Maria Popova, PhD, McGill University 64. Marie­Louise Vierø, PhD, Queen’s  University 65. Jin Yeub Kim, PhD (expected), University of Chicago  66. Gennadi Pobereżny, PhD, Harvard  University 67. Daniel A. Diermeier, PhD, Northwestern  University  68. Alan Miller, PhD, University of Haifa 69. Célestin Monga, PhD, Association for  Education and Development­­USA 70. Alberto Bisin, PhD, New York University 71. Roee Tepper, PhD, University of Pittsburgh 72. Alistair Wilson, PhD, University of  Pittsburgh

A Call for Debate on Political Decentralization in ...

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