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Nobel Prize Winner Roger Myerson: In Healthy Democracies, Future Presidents Prove They Can Manage Public Funds In Local Governments


Kyiv, 18 March 2014 – Roger Myerson, a Nobel prize winner, professor of economics at the University of Chicago, during a round table discussion held at the Ukraine Crisis Media Center, posited that governors of Ukraine’s regions should be elected rather than appointed. This will create a broader supply of trusted alternative candidates for top government positions. “The best national leaders are those who have already proven themselves in local governments. To restore public trust to the country’s government, part of the authority should be delegated to local leaders elected by local communities”, said the economist.

Together with Tymofiy Mylovanov, professor of economics at the University of Pittsburgh, Myerson initiated a debate on decentralization in Ukraine. He cited Austria as an example where approximately 10% of public funds are spent by municipalities, 25% are spent by provinces, and the remaining two-thirds of public funds are managed by the central government. The economist calls this a “healthy” distribution.

Members of the Ukrainian Parliament and experts discussed the so-called Myerson & Mylovanov Initiative to decentralize power in Ukraine at a roundtable at the Ukraine Crisis Media Center. Director of the Civil Society Institute, Anatoliy Tkachuk, who authored most of Ukraine’s bills on local self-government and administrative reform, believes that the executive authorities should be organized into a strong vertical power structure. “A concept has been adopted in Ukraine where councils are elected at the regional and district levels while the governor – an appointed public official supported by a small staff – performs the control function”, said the expert.

Member of the Ukrainian Parliament Gennadiy Zubko (Batkivshyna faction) said: “The elected regional councils had trust but lacked powers since they had to delegate them to regional administrations. The governors appointed ‘from above’ had the powers but lacked the trust. This is why we are now looking for a tool which to help us balance the situation.” The MP says that with decentralization, regions can compete in terms of economy rather than politics.

Experts believe that a sound public decentralization strategy could be an efficient response to the federalization idea which is now being forced upon Ukraine by Russia. Andriy Pavelko, an unaffiliated member of parliament, said: “A basis for new ‘referendums’ similar to the one held in Crimea is being prepared in the south and east of Ukraine under the pretext of increasing the scope of powers at the local level. Centralization and monopolization of power which has been happening since 2010 is the reason why people took to the streets.” The new government has already included the principle of decentralization in its program. It should be implemented in the most transparent way possible, on the basis of the experience of other European countries, the politician says.

According to Volodymyr Polochaninov, member of parliament, Batkivschyna Party, decentralization will facilitate social mobility in the regions: “Electing the governors means there will be another 27 persons capable of creating a political competition to the officials of the state. The infamous ‘stability’ will be gone, and we will be able to establish real democracy.”

Executive Director of the Sofia Center for Social Studies, Volodymyr Lupaschiy says that administrative reform can be launched with a month: “It needs to be done in two phases: increasing the powers of territorial communities and transition to regional self-governance. There is already a package of laws in place for that.”

According to a poll conducted by “Rating” Sociology Group on March 14 2014, 61% of Ukrainians believe unitary state is the best form of government for Ukraine. The highest percentage of federation supporters – 59% – was recorded in Donbas while the western regions showed the lowest percentage, only 4%.

Victoriya Podgorna, Director of the Center for Social and Political Planning, said: “Today, Russia’s demand to federalize Ukraine has become the official position of the Russian Federation. However, the Ukrainian society does not agree. We need to oppose this demand with our own decentralization strategy.”

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