US embassy cable - 05BUCHAREST982

C O N F I D E N T I A L SECTION 01 OF 02 BUCHAREST 000982 
 
SIPDIS 
 
STATE DEPT FOR EUR/NCE WILLIAM SILKWORTH 
STATE ALSO FOR INR/B 
 
E.O. 12958: DECL: 04/20/2015 
TAGS: PGOV, PREL, KDEM, SOCI, ECON, PINR, RO, election forecast, biographic information 
SUBJECT: FORMER ROMANIAN RULING PARTY PREPARES FOR NATIONAL 
CONGRESS; FEW PROSPECTS FOR REFORM 
 
REF: BUCHAREST 199 
 
Classified By: POLITICAL SECTION CHIEF ROBERT GILCHRIST FOR REASONS 1.4 
 B AND D 
 
1. (SBU) Summary.  The Social Democratic Party (PSD) holds 
its national Congress April 21-22, an event at which 
ex-Romanian President Ion Iliescu will likely be elected 
party president while former Prime Minister Adrian Nastase 
will probably win the number two slot of Executive President. 
 Despite some dissent within the party and a challenge by 
several party "reformers" during the Congress, PSD insiders 
and independent analysts predict that the party's old guard 
will triumph, noting the recent selection of local leaders 
from the ranks of party "barons."  Nonetheless, secret 
balloting during the congress (a first for the PSD) and 
opportunities for dissenters to mount the rostrum guarantee 
that the congress' outcome is not a foregone conclusion.  End 
Summary. 
 
Out with the Old, In With the...Old 
----------------------------------- 
2.  (C) The PSD has faced an identity crisis and internal 
power struggle since PM Nastase's unexpected defeat in the 
December 2004 presidential elections by Bucharest Mayor 
Traian Basescu and the subsequent formation of a center-right 
coalition government led by PM Calin Popescu-Tariceanu (Ref). 
 Soon after the fall elections, former Interior Minister Ioan 
Rus called publicly for revitalization of the party, urging 
vigorous attempts to recruit young supporters.  More than 
four months after the parliamentary and presidential 
elections, Rus remains an influential voice within the party, 
especially in his region of Transylvania, calling for "new 
leadership" and urging former President and party founder Ion 
Iliescu not to run for party president.  His allies include 
popular ex-FM Mircea Geoana, ex-Justice Minister Cristian 
Diaconescu and ex-Finance Minister Mihai Tanasescu. 
 
3.  (C) In the face of these calls for reform, the PSD 
"barons" - Romanian political shorthand for powerful, often 
corrupt local party leaders - have circled the wagons. 
During the first two weeks of April, local party officials 
across Romania chose the leaders of each of the nation's 41 
judeti (counties) plus Bucharest.  They include almost no 
fresh faces and the list of "new" county leaders is heavily 
weighted toward incumbents, including such notorious local 
heavyweights as Constanta Mayor Radu Mazare (who reputedly 
has ties to organized crime), Bacau party boss Viorel 
Hrebenciuc (linked to several corruption scandals, including 
the RAFO-Onesti refinery privatization), Bucharest's Dan Ioan 
Popescu (also linked to corruption allegations) and Vrancea's 
Marian Oprisan (frequently cited as one of the most 
heavy-handed local officials).  Independent analysts point to 
these local elections as proof positive that the PSD is not 
ready to adopt meaningful internal reforms. 
 
Party Congress - Reform or More of the Same? 
-------------------------------------------- 
4. (SBU) Over the past several weeks, senior PSD officials 
seeking election to national party offices have traveled 
across Romania courting local PSD organizations.  According 
to credible inside reports, Iliescu, Nastase, PSD Vice 
President Miron Mitrea and the Rus-led reformers each can 
count on the support of about an equal number of county 
organizations.  Local support is crucial at the congress, 
since the PSD's county leaders are instrumental in selecting 
the 1500 plus delegates for the April 21-22 party national 
congress.  Many, if not most, delegates will probably follow 
the direction of their county's leader.  An important wrinkle 
to this year's congress, however, is the fact that election 
of party national officers, who will serve for two-year 
terms, will be by secret ballot - a first for the PSD. 
 
5.  (SBU) PSD insiders confirm that Iliescu and Nastase have 
temporarily put aside their bitter political rivalry, 
agreeing that Iliescu should be elected party President, with 
Nastase filling the post of Executive President.  The 
Iliescu-Nastase accord averts a confrontation during the 
congress between the PSD's two most powerful leaders.  Miron 
Mitrea, one of the PSD's most effective, longstanding 
political insiders and head of the PSD parliamentary group in 
the Chamber of Deputies, has announced that he will seek the 
party's number three slot, Secretary General, opposed only by 
the young and outspoken, but politically weak Victor Ponta. 
Many analysts view Mitrea's bid for the SecGen slot as proof 
of his tacit assent to the Iliescu-Nastase entente. 
 
6.  (C) Adding a wild card to these calculations was the 
April 19 announcement by Geoana that he would compete against 
Iliescu for the party presidency.   Former party spokesman 
Serban Nicolae has also announced his intention to compete 
for the job, thereby potentially splitting the reformist 
vote.  Geoana declared April 15 that proponents of change 
will consider "a radical strategy" if the congress fails to 
"renew and modernize" the party.  That message was also given 
to the Charge in a recent conversation with ex-Justice 
Minister Diaconescu.  He said that he, Rus and Tanasescu 
would all join Geoana in seeking high office in the party 
hierarchy at the Congress.  Failing that, the door leading to 
a bolt from the party was open. 
 
7.  (SBU) The congress will also decide how many VP positions 
the party will have, but party leaders indicate that initial 
plans are to shrink the total number of VP positions 
(currently at 17), possibly boding for heightened competition 
during the congress for fewer posts.  Many of the PSD's 
current vice presidents, including Senate President Nicolae 
Vacaroiu, Rus, Diaconescu, Tanasescu, and respected ex-DefMin 
Ioan Mircea Pascu have announced their intention to run for 
VP slots.  In addition to selecting national party leaders 
for the next two years, the delegates will also vote on the 
party's internal regulations and platform. 
 
8.  (C) Comment.  Despite battle lines drawn between the "old 
guard" and ostensible reformers, the PSD's leaders are eager 
to avoid the kind of damaging public split that enfeebled the 
party in the late 1990's.  Political analysts stress that the 
PSD faces virtually the same dilemma now as it did in 1997. 
They find themselves unexpectedly in the opposition after 
several years in power.  They are divided by recriminations 
about the reasons for their electoral loss, and split between 
an anti-corruption reformist wing and solidly-entrenched 
party barons (mostly the same barons as in 1997).  The 
difference between then and now is that senior leaders have 
been working behind the scenes to smooth over differences 
before the congress and avoid a public blood bath, viz., the 
Iliescu-Nastase entente.  Geoana remains the single most 
popular PSD politician on a national level, according to 
opinion polls.  However, he, Rus and their supporters lack 
both a political machine that compares with the forces 
wielded by the party barons, or their down and dirty 
aggressiveness. 
 
9.  (C) Additionally, many of the PSD insiders we have spoken 
with are far more focused on internal party politics than on 
expanding the party's shrinking electoral base (currently 
made up primarily of aging and rural voters) or countering 
the wave of popularity that Basescu and the Tariceanu 
government have capitalized on since the fall elections. 
Indeed, one PSD kingpin confided to PolChief recently that 
the party's strategy relies on the center-right alliance's 
"making a mistake," acknowledging with a rueful shrug that 
the PSD lacks a national plan targeting youthful voters. 
Although the PSD remains the largest single party in 
parliament, with about 34 percent of Deputies and Senators, 
it has not regained the morale and focus it lost after last 
fall's elections.  There is no indication that the PSD will 
rise reinvigorated from this week's party congress.  End 
Comment. 
 
10. (U) Amembassy Bucharest,s reporting telegrams are 
available on the Bucharest SIPRNET Website: 
www.state.sgov.gov/p/eur/bucharest. 
DELARE