Oligarchic Party-Group Relations in Bulgaria

mihail petkov

oligarchic party-group relations in bulgaria The Extended Parentela Policy Network Model

Oligarchic Party-Group Relations in Bulgaria

Mihail Petkov

Oligarchic Party-Group Relations in Bulgaria The Extended Parentela Policy Network Model

Mihail Petkov Naples, FL, USA

ISBN 978-3-319-98898-6 ISBN 978-3-319-98899-3  (eBook) https://doi.org/10.1007/978-3-319-98899-3 Library of Congress Control Number: 2018951558 © The Editor(s) (if applicable) and The Author(s) 2019 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. Cover credit: Agata Gładykowska/Alamy Stock Photo This Palgrave Macmillan imprint is published by the registered company Springer Nature Switzerland AG The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

Acknowledgements

Special thanks to my parents Plamen and Lachezara, my wife Irena, my supervisors Andy Aitchison and Richard Parry, my colleagues Francesca Batzella and Lambros Kaoullas and last but not least my first supervisor Grant Jordan, who supported my decision to undertake this project, for your advice, guidance and most of all patience with me and this project. Thank you!

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Contents

1 The Extended Parentela 1 Introduction 1 Definition: Policy Networks and the Parentela 4 Parentela and Oligarchy 11 Methods 18 Structure of the Book 24 References 25 2 The Parentela Through the Eyes of Bulgarian Policy-Makers 29 Primary Venue and Venue Scope: Party’s Interference in the Civil Service 31 Through Political Appointments 31 Through Civil Service Reforms 40 Degree of Access, Cooperation and Power Parity 47 Expertise for Access 47 Voter Support and Ideological Proximity for Access 49 Campaign Funds for Access 53 Conclusion 56 References 56

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3 La Palombara’s Parentela in Bulgaria: The Case of Public Procurement Contracts (Public Tenders) 59 The Law on Public Tenders 2004 and the Parentela 60 Party Interference in Public Tenders 68 Conclusion 73 References 75 4 Type Two Parentela as an Instrument of Coercion 77 An Offer You Cannot Refuse 80 An Insider’s Move 86 Internal Party Dissent 89 External Group Dissent 90 Conclusion 92 5 The Extended Parentela as a Model of Party-Centric Oligarchic Relations in Bulgaria 95 A Contest Between Elites 97 Party-Centric Elites and Centralization of Political Power 99 Oligarchic Dynamics 103 Causes for the Extended Parentela 113 Oligarchic Consolidation: A Hypothesis 115 Conclusion 119 References 121 6 Ukraine Under Kuchma—An Illustration of the Link Between the Extended Parentela and Consolidated Oligarchy 123 Basic Parentela Relations in Ukraine 127 Coercion 129 Consolidated Oligarchy During Kuchma’s Tenure 133 Consolidated Oligarchy Compared 136 Competitive Authoritarianism 137 Neo-patrimonialism 138 The Three Terms Compared 139 Consolidated Oligarchy vs. Biased Pluralism 141 Conclusion 144 References 146

Contents   

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7 The Parentela and Oligarchy 147 References 160

Appendix 161 Extended Bibliography 167 Index 181

List of Figures

Fig. 2.1 Fig. 2.2 Fig. 2.3

Do you believe that political appointments in the state administration happen often/sometimes/never? (Spirova 2012: 60) 34 Structure of political appointments in Bulgaria: central executive 36 Structure of political appointments in Bulgaria: local executive 38

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List of Tables

Table 1.1 Table 1.2 Table 1.3 Table 2.1 Table 6.1

Policy network descriptors 6 Policy network classification using policy network descriptors 10 Respondent pools 20 Levels of PPA (Kopecky and Spirova 2011: 907) 32 Pluralist vs. oligarchic state–group relations 144

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CHAPTER 1

The Extended Parentela

Introduction Democratic policy-making and politics are often equated to elections, Presidents, Premiers and Parliaments. Voters and the media are usually focused on what politicians say and do, creating the impression that this is politics in its totality. Of course, this is not the case. Politics is a highly informal enterprise and many if not all policies originate from some form of informal or semiformal communication among interest groups, civil servants, the Parliament and the party in power. The present book, therefore, looks into one such form of informal interaction between interest groups and political parties known in the literature as the parentela policy network model. It is an analytical extension of a doctoral study, which was conducted from 2012 to 2016, and also which was focused on verifying that model still existed today, and if that was indeed the case, establish how the Bulgarian parentela differed from its original version in 1960s Italy. The main argument here is that not only does the parentela exist in Bulgaria in an advanced form, it also generates an oligarchic dynamic. Ultimately, the final chapters will bring the analysis to the hypothesis that the diminishing inter-party competition will transform the oligarchic parentela dynamic into a status quo. But let us not go too far too soon. The parentela is a netowrk relationship model where an interest group with an insider access to the ruling party extends its reach into the civil

© The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3_1

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service1 usually, but not limited to, nominating new or utilizing existing party political appointees in the Bureaucracy. In the 1960s, Joseph La Palombara observed (in his Interest Groups in Italian Politics (1964)) a type of a party-group relationship which provided the Catholic Action (CA) interest group privileged access to policy-making at the expense of other interest groups competing for the same (e.g. Confindustria). The purpose of his book was to find out how Italian interest groups participated in the policy-making process and influenced it. The success of CA was due to its ability to lend its large supporter base and financial resources to the already ideologically receptive Christian Democrats (DC). In the relationship which he later called parentela, the party insider (CA) assumed influential policy-making access because the DC intervened on its behalf in the civil service. Although the book also mentions civil service reforms, it emphasizes that political appointments were the primary method of intervening in the civil service. Though legal, this practice had the effect of subordinating the bureaucracy with politically dependent bureaucrats acting as conduits of the decisions taken between the party and its insider (parente collectively). Moreover, often La Palombara’s respondents reported that appointed civil servants were nominated by the party insider as opposed to the party. Thus, by nominating new or utilizing existing party political appointments, the CA dominated policy-making in 1960s Italy. Nearly thirty years later, Alan Greer presented another case of the parentela policy network but this time in Northern Ireland (Greer 1994). In his study, he focused on the extent to which the existence of hegemonic political parties explained the parentela formation. In doing so he researched the relationship between the Ulster Farmers’ Union and the Unionist Party’s government of Premier Stormont for the period from the 1920s to 1970s. Accordingly, he found that in line with the parentela dynamic established by La Palombara, the Unionist party appointed as ministers of agriculture nominees from the Ulster Farmers’ Union. This symbiotic relationship rested on the exchange for political support by UFU’s membership in exchange of Stormont protecting UFU’s interests by appointing their nominations as agricultural ministers. Both cases of the parentela demonstrate identical dynamics: a 1 The

terms party, civil service (Bureaucracy) and Group(s) are used in the book whenever the text seeks to emphasize on their theoretical value in the context of the relationship between the agencies of a state, the bureaucrats and interest groups, or simply, policy networks.

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hegemonic political party in cooperation with a sizable trade union in an exchange-based relationship, where the insider nominates new or utilizes already existing party nominations in the civil service. The BPS project was initially set to test the proposition that hegemonic political parties caused the parentela and then how that relationship, if found in Bulgaria, differed from that in Italy earlier. La Palombara’s hypothesis was that hegemonic parties like the DC were the main cause. That remained to be tested with the Bulgarian case. The pilot study defied this proposition, because it discovered strong evidence of party-group forms of cooperation in the presence of active competition between political parties. This indicated that the parentela might exist in competitive party systems, as opposed to predominant ones, where a single dominant party competes amidst a number of other considerably less preferred ones by the voters (as it was the case in Italy and Northern Ireland). By the end of 2015, when final fieldwork of the BPS was completed, where the Bulgarian status quo confirmed the existence of this arrangement. The final results showed that not only La Palombara’s parentela existed, but we can also observe new parentela dynamics in addition to those discovered initially by him, labeled collectively the extended parentela (Petkov 2016, 2017). However, space allowed only for the treatment of the question how parentela relations differed between 2010s Bulgaria and 1960s Italy. The other equally important question about the implication on democracy received only cursory treatment. This book is, therefore, dedicated to that very subject and the extent to which the extended parentela can serve as a process that can bring about a consolidated oligarchic status quo in Bulgaria and in general. In fact, the question on the relationship between the parentela and oligarchy is not new. La Palombara’s respondents confronted him with the possible connection between (alleged) Italian oligarchic practices with the parentela already back in the 1960s. While he vehemently opposed such views (1964: 314), arguing any such line of inquiry feeds conspiracy theories, the BPS does not allow us to be as dismissive. Just as La Palombara’s respondent brought up the issue, the interviewees in this study, too, defended the same view that Bulgarian policy-making is near-authoritarian, premier-centrist without a clear distinction between business and politics: in other words, oligarchic. The book argues, therefore, that the parentela in the Bulgarian context, i.e. the extended parentela, is itself oligarchic and generates an oligarchic dynamic. We can choose to see the parentela and its newly extended version simply

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in terms of relations between groups and political parties, but we can also choose to look at them from a macro-perspective, i.e. on the general level of state-group relations. It is the extended parentela dynamics then that serves here as the possible link to the idea of oligarchy, which La Palombara was confronted earlier. The book ends with the hypothesis that the unchecked extended parentela dynamics in Bulgaria in combination with diminished interparty competition will lead to a consolidated oligarchy status quo. Seen broadly, however, this hypothesis states that it is possible that the parentela dynamics could transform the state-group relations from pluralist to oligarchic. It is important to highlight though that we are not saying that the system of government will change or that the current democratic institutions in Bulgaria will change. Rather we are saying here that if groups in a pluralist status quo find themselves in competition, as it is currently the case in Bulgaria, then an unchecked extended parentela dynamics coupled with a decline in inter-party party-competition will produce a status quo where only those groups in very close orbit to the ruling party will have policy access and will dominate the policy-making process. The extended parentela thesis and the follow-up hypothesis theorize that an oligarchic status quo can be informal and embedded in the democratic institutions of a state. The present chapter, therefore, will proceed by introducing the concept of the parentela policy network and the conceptual context it inhabits. That is we will discuss the system of policy network classification which is used to differentiate between the various policy network types. Then, while keeping the debate on the methods used in the study, we will end with a quick overview and a map of following chapters. Chapters 2, 3 and 4 are dedicated to describing the building blocks of the extended parentela, while chapter five brings all of these elements together, where the extended parentela is presented as whole. Chapter 5 also presents the reason why the extended parentela is oligarchic and with that the section essentially explains what the current oligarchic Bulgarian dynamics are and how they function. Chapter 6, then, applies the oligarchic model to outside polities, which could act as suitable candidates to verify this model.

Definition: Policy Networks and the Parentela The parentela is one of the few forms that state and interest groups relations can take. Precise definitions in the field, unfortunately, are scarce. When looking for the policy network definition Jordan and Schubert (1992: 11–12), and Van Waarden (1992) emphasize that we inevitably are

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confronted with two tasks: to develop a generic policy network definition that refers to network types without conceptually overlapping with any of them, and second to define each network type in a form of network classification, so that each network type is distinct from the other (also Pappi and Henning 1998; Rhodes and Marsh 1992; Peterson 2003). In other words, because the term policy network implies a variety of networks, a policy network definition requires us to tackle two challenges. First, the generic term that refers to all network types has to be as broad and neutral as possible so that its meaning and definition do not overlap with any of the network types that comprise it. And second, each network type has to be defined in a way that makes it distinct from the rest of the network types and the generic term. There are two authors in the literature, whose combined policy network conception satisfies these two prerequisites. Hanf defines policy networks simply as the collection of public and private actors involved in policy-making: the term ‘network’ merely denotes […] that policy making includes a large number of public and private actors from different levels and functional areas of government and society.

If we adopt Hanf’s definition, where policy networks are simply networks of actors involved in policy-making, we then need a way to differentiate one network from the other (as per objective two above). Fortunately, Hanf’s definition is broad and neutral enough to subsume Dowding’s position that we can differentiate between policy networks based on the differences of the relations between the actors they interconnect: ‘Networks are distinguished one from another by the relations between the actors’ (Dowding 1995: 152). In other words, for Dowding, a policy network is essentially a relationship between groups and policy-makers, which may be described, for example, as constructive or destructive, power-balanced or power-asymmetric, or that between a policy-maker and an outsider group (see Table 1.1 below). We can then say that each of the qualities of these state-group relationships can act as that network’s descriptor, in which case we could distinguish between network types based on the combination of the network descriptors. Policy networks, then, are essentially relationship formats between groups and policy-makers, which can take various configurations, where a policy network type is defined by a specific combination of a finite number of descriptors. The network descriptors used in this study in

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Table 1.1  Policy network descriptors Descriptor (Indicator)

Data type

Metrics

Degree of access

Ordinal

Core insider

Network dynamic Power ratio

Binary Ordinal

Primary venue Scope of venues

Categorical Multiple response continuous

Cooperation Group less powerful party party

Group strategy (Yishai 1992: 275)

Peripheral insider Conflict Parity

Outsider

Group more powerful Bureaucracy Parliament Bureaucracy Parliament

Media Media

Frequency of contact with a policy venue

order to define the handful of policy networks currently in existence was governed by a number of principles: • First and foremost, based on the Anglo-Saxon school, in Borzel’s terms (Borzel 1998); • Fewest practically possible descriptors; • Descriptors also have to be applicable to all known policy networks; • Select such descriptors so as to maintain a meso-level focus, as per Marsh and Rhodes (1992: 1–4). We can say that the (extended) parentela here is defined in terms of these descriptors, which can be expressed as nominal, categorical or numerical variables: power asymmetry (power ratio), network dynamics, degree of access, primary venue and venue scope. It has to be stressed that these relationships are labeled from the perspective of the group, i.e. whether the group has access (insider status), whether it dominates the policy venue (e.g. overpowering below) or where it is in conflict or cooperation with venue policy-makers. A more detailed discussion and justification for the descriptor selection and policy network definition could be found in the official report of the study (Petkov 2017) and the original thesis (Petkov 2016). It suffices to say at this time that a number of authors have attempted to classify policy networks in terms of the power relations between groups and

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policy-makers as the starting point (Atkinson and Coleman 1989: 54; Van Waarden 1992: 50; Rhodes and Marsh 1992: 184; Silke and Kriesi (2007: 133–135). This network dimension stands for whether the group is more or less powerful than the policy-makers it interacts with, or that there is a balance between them. The second dimension we can plot policy networks on is network dynamics. It refers to whether there is conflict or cooperation between the two sides. Next is degree of access, which indicates the degree of access the group has: core or peripheral insider, or outsider (Van Waarden 1992; Yishai 1992; Jordan and Schubert 1992; Grant 1977, 1978; Jordan et al. 1992; Maloney et al. 1994). The fourth indicator is primary venue, which describes where the network starts its formation. The parentela begins with a group establishing insider status with a political party and then reaching out to the civil service. In the case of other networks, such as policy community, the group first establishes insider status within the civil service and only then it may extend it to the legislative committees. Finally, venue scope represents the policy venues the group extends into (Van Waarden 1992: 42–50; Atkinson and Coleman 1989: 55–59; Yishai 1992: 282; La Palombara 1964: 306–316, 322–331). The parentela, for instance, covers the party and civil service, while the issue network may span across all major venues such as the Media, Legislature and the Executive bodies. One should probably mention that a policy venue here is any location which can serve as the arena of the political conflict, e.g. a consultative meeting behind closed doors, parliamentary hearing to committees, televised talk shows, public protest. The following table summarizes all of the network descriptors adopted in this study. Though excluded from the study, this last descriptor is mentioned here for completeness. The descriptor measures the frequency of contacts of the group with policy-makers in a given policy venue and with that is very similar to the idea of degree of access. The higher frequency of contacts, the deeper the access. It suffices to say at this time that there is a push for the quantification of all network descriptors used to define the policy networks of the so-called Anglo-Saxon school, part of which the parentela is as well. However, there has been no progress made in that direction since the call was made (Dowding 1995, 2001; Thatcher 1998), which is why a separate study is necessary to address this issue. It is for this reason that the BPS study is qualitative. In any case, what we will see below are the policy network descriptors, which have been used in this study to define the various policy network

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models, including the (extended) parentela. In the later paragraphs, we will very briefly present the network models which will then be plotted in a table using the descriptors below (Table 1.1). It was stated above that the policy networks are defined by the type of interaction between policy-makers and groups and the relationship format they lock themselves in. A relationship format is the combination of the network descriptors (or indicators), which were defined in the table above. In the following paragraphs, we will plot the parentela in the context of the rest of the policy networks from the literature. The point of the exercise is to provide a broader context for our readers that might not be too familiar with the policy network concept. The study formally recognizes five policy networks and highlights the possible existence of another, the prisoner insider, which falls outside our interest here, but is nevertheless included for completeness again. One of the very first patterns of interactions between groups and policy networks are the iron triangles or sometimes subgovernments. These are a network derived from the US policy-making context and represent groups with insider status within the legislative committees, whose influence could extend to the executive administrative structures (Ripley and Franklin 1987: 8–9; Jordan 1990: 319–320, 322, 324). Similar to the iron triangles, the policy community is a network type discovered in the British policy-making context in the 1970s (Richardson and Jordan 1979). Though it may also span from the executive branch into the legislative, the network is usually contained in the civil service departments. Both networks are similar as they represent a cooperative and power-balanced relationship. The cooperation is in the form of provision of expertise to policy-makers. Policies are complex and the needed technical details cannot always be provided by the civil service alone. Technical information provided by interest groups in the delivery of sound legislation is invaluable. And it is here where cooperation lies: expertise is exchange for privileged access to policy-making. Groups in such a position are then are called core insiders, or if some are only occasionally consulted—peripheral insiders, while those entirely excluded, outsiders. The clientela is another similar network. It was first observed in Italy, along with the parentela, by La Palombara (1964). The clientela, in theory, differs from the previous two network types in that the interest groups overpower the civil servants. A clientela typically represents an insider whom the civil service has come to depend on for technical

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expertise and its own internal interdepartmental conflicts (Richardson and Jordan 1979: 55; La Palombara 1964: 262). The parentela is La Palombara’s other network he discovered along the clientela. As we already mentioned, this relationship format is between the group and the party in power. By gaining insider status within the ruling party, the group then seeks to extend it into the civil service (1964). Finally, issue networks are the last formally recognized policy networks by the study. They are characterized by conflict and overpowerment. Politicians, PR companies, along with interest group stakeholders, journalists and scientists are seen here divided into (usually) two camps in a total political battle. Unlike any of the networks so far, the network is based on conflict waged by outsiders and not on cooperation with insiders. If groups aim to be agreeable to policy-makers and willing to make concessions, the issue network then is the opposite relationship: the groups are in open conflict with policy-makers Jordan (1981; 1990: 330; 2005), Grant (2004), Richardson (2000), Maloney and Richardson (1994), Maloney and Jordan (1997), Gais et al. (1984). On the basis of all hitherto reviewed network types and descriptors, the following table was constructed and adopted in the study (Table 1.2). Two points warrant immediate mention. First (in asterisk), prisoner insider is a hypothetical policy network that follows from Wyn Grant’s classification of insider status interest groups, which also included the insider category prisoner (1977). It is the situation where an insider group is overpowered or under the control of the state, e.g. these could be quasi-NGOs or any form of cooption of external administrative structures (those of interest groups) in the central executive. The other point is the reminder that the literature tends to express the network descriptors from the perspective of the group vis-a-vis the relevant venue policy-makers. This perspective is also maintained in table above as well. What we need to take out from the above discussion is that policy networks represent the relationship between (interest) groups and policy-makers from a specific policy venue. This relationship can be described with different indicators, or descriptors. The combination of the values of these indicators (descriptors) defines each policy network type. The parentela, then, is a type of a relationship between party policy-makers and an insider group, characterized by cooperation and with a span from the party into the civil service. Moving forward to the core question addressed in this study, the following section looks at the possible relationship between the parentela and oligarchy.

Subgovernments Policy community Prisoner insider* Clientela Issue network Parentela

Outsiders

Network dynamics

Power ratio

Primary venue (PV)

X

X

X X

X

?

X

X

X

X ?

X

X

X

X X

X

X

X X

X

X

X

X

X

X X X

X

X

X

X X

X

X

X

Political Legislature Media/ party Public

Scope of venues

Core Peripheral No access Conflict Cooperation Group over Parity Group Executive Ruling Legislature Media/ Executive Public adminispowered overpowering adminis- party tration tration

Insiders

Degree of access to PV

Type of policy Descriptors network

Table 1.2  Policy network classification using policy network descriptors

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Parentela and Oligarchy As already mentioned, the present book is an analytical continuation of a doctoral research project which initially dedicated to ascertaining the continued analytical utility of the parentela and policy networks in general. The project was successful because not only we can confirm that network’s existence but it was also possible to identify new dynamics that originated from the same core party-group relationship. Some of the critical methodological strategies have been outlined in a joint-report with Kaoullas (Petkov and Kaoullas 2016), while the core results have been reported for the inaugural issue of Bulgarian Studies (Petkov 2017; also Petkov 2016). The text, again, will refer to this study as the Bulgarian Parentela Study or BPS for short. A few themes emerged from the BPS that were not well integrated in the earlier report. Taken together they seemed to convey another message beyond the confirmation of the parentela. It was only at the very end stages of the writing up process that it became evident that the data allows for another interpretation. It suggested that the Bulgarian parentela can also operate on a macro-level of policy-making, also exhibiting elitist and coercive traits. Results indicated that the Bulgarian parentela was not only an arrangement to provide a legislative advantage of party insiders, but its overall reiteration generates oligarchic dynamics on a macro-level. As it was mentioned in the very beginning the theme on the link between the parentela and oligarchy would have probably gone unnoticed had it not been for the fact that La Palombara, too, had faced the same phenomenon when discovering the model. Let us look into more detail. La Palombara’s parentela merely states that an interest group with privileged access to the party in power is able to further gain insider status in the civil service by having the party interfere in the central administration on its behalf. Examples of such interference, however, so far seem to be primarily in the form of political patronage. This means that the party insider is taking advantage of the ability of the ruling party to make appointments in the civil service. Thus, by participating in this process by offering its own nominees to be later appointed by the party, the party insider ensures that those appointees will intercept any important piece of legislation circulated in the civil service. We could also add—and La Palombara does discuss it—that civil service reforms or reshuffling is another form of party’s interference, but it is merely implied that such

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actions could act in the interest of the party insider and that has not been fully integrated into the model. At first, the BPS confirmed the existence of La Palombara’s parentela by replicating his method of conducting elite interviews among politicians, civil servants, interest groups and other policy-makers. The methodological details of those interviews will be discussed below. What needs emphasis here is that the elite interviews confirmed the existence of the La Palombara’s parentela in Bulgaria. Using in-depth interviews, the respondents were invited to share with the researcher, to the best extent possible, their experiences and thoughts on policy-making and specifically the role of political parties. Again, each of the elements constituting the parentela could be found in those responses, but there was the question whether that was enough? Could we also find a parentela relationship in action? Surely a better test for the parentela would be its discovery in operation. The responses of a number of interviewees were used as pointers where to possibly look for the parentela. As this was a pioneering study in Bulgaria on policy networks and the parentela in particular, there were no preceding policies or legislative proposals that could have aided the BPS in offering any case studies to anyone outside the field. In any case, the case of the Law on Public Tenders (2004) eventually provided the missing evidence on the parentela in action, although by doing so it presented a somewhat altered version of that network, which indicated that the Bulgarian parentela dynamic is more complex. Public tenders or public procurement contracts are agreements between the state and a private company for the provision of a good or a service to the public. All prospective contractors are invited to submit their offers (or bids) of the terms under which they will carry out the service. A special civil servants’ committee ultimately decides on the feasibility of each offer and selects the winning bid. What the case study on Public Tenders observes is that as committee members are appointed by the party in power, that enables it to influence the choice on the winning bid. Therefore, following the logic of the parentela, the party interferes in the work of the civil service in the interest of its party insider ensuring thereby that they win the procurement auction. However, this discovery carried with itself a number of small differences from the original parentela. Ultimately, in combination with the rest of the data these differences suggest that the parentela has a larger dynamic than previously thought. First and foremost, we find the

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parentela outside immediate policy-making. This differs not only from the original version but from policy networks idea in general, which have been developed in the context of policy-making. Instead, we find the parentela in the gray area between formal policy-making and illegality. Second, if earlier parentela studies of La Palombara (1964), Greer (1994) and Yishai (1992) focused on formal interest groups, such as Trade Associations, NGOs or professional bodies, respondents and the Public Tenders case spoke of party insiders in terms of either single affluent individuals (colloquially oligarchs) acting solo or in concert with firms forming thereby a single informal actor. This suggested the parentela insiders from the BPS were informal insider groups. On their own these were significant departures from the original parentela, but their significance becomes meaningful only if seen in combination with the rest of the thematic data that did not receive full treatment in previous reports. A major discovery made in the study was a second parentela dynamic, or prejudiced regulatory inspections (PRIs). In this new dynamic a party has mobilized its appointees in the regulatory agencies to investigate a specific private company, firm, oligarch, or simply a business. The prejudiced inspection in this case serves as an anonymous coercion, aimed to sabotage the business operation of the visited establishment through the creative discovery of legal-administrative malpractice or nonadherence to existing regulations. For example, PRIs can take the shape of police raids conducted under the pretext of pirated software; tax investigations done under the pretext of evasion or rescission of licenses of operation on slim or nonexistent evidence which cannot uphold legal scrutiny. And this is the tricky part. The purpose of such regulatory inspection is not to win a case in court against a targeted business but to stall its market operations long enough (through litigation, revocation of licenses, freezing of assets, or otherwise) so that the target loses its market shares due to market inactivity. Furthermore, this second parentela type dynamic was discussed in the context of political parties. A number of respondents revealed that PRIs can be used by political parties as a form of retribution or coercion, either in the pursuit of own goals or to the interest of their insiders. It is easy to see how for instance PRIs can act in the interest of party insiders. With the use of administrative coercion against their direct business competitors, an informal insider can expand their market shares at the expense of the target.

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There, however, were a number of respondents who also stated that PRIs could be executed solo, by the ruling party for political reasons. Businesses that take part in formal interest groups that oppose governmental (ruling party, that is) policies can be put under PRI pressure. Defecting party members, too can be so coerced. A third individual use of PRIs by political parties was to punish noncooperative businesses. A few respondents reported on the so-called offers made by political parties to participate in specific procurement auctions, where against party’s assurance that the group will win the bid, the latter would have to give back to the party some of the monies provided for project’s completion. One variation of the offer is where the monies will reflect artificially inflated completion costs part of the winning bid’s documentation, so that there is a larger share for all actors involved. As the few respondents brave enough to speak from first-hand experience shared, refusal to such offers is met with a ferocious pressure from the regulatory authorities to bring the firm out of business. The discovery of type two parentela, the fact that the parentela operates outside policy-making and with the engagement of informal groups, creates a dynamic that adds much more depth to the original parentela model. Both parentela types—the original and its second dynamic—construct a much more complex model, which covers the spectrum from policy- to non-policy-making. Type two parentela adds considerable realism because politics is not only about policies. The political battle is fought outside policy-making, too. Politics is also about political subsistence, whose origins might not be particularly palatable to the average citizen. All of the above is half of what the book seeks to communicate to the reader: Bulgaria at present harbors a variation of a policy-making dynamic which has largely been ignored in the literature. The second half of the message of this book is that the extended parentela model is oligarchic, which becomes perceivable only if the model is seen from a macro-level of analysis. Looked from this perspective, the extended parentela can be seen as generating a party-centric oligarchic dynamic, whose reiterations with every new parliamentary elections create elites, pits them against each other and then eliminates them. Ultimately, the book hypothesizes that if unchecked this dynamic will bring about the emergence of an oligarchic status quo. But what does this all mean, and what are elites, how are they created and why party-centric?

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Let us first address the question of why the model is party-centric. We already observed in the parentela discussion above that the model is itself based on the party in power and its ability to interfere in the work of the civil service. However, Bulgarian political parties are significant also in the wider political sense as unchecked and unbalanced centers of political power. This means that instead of a Parliamentary democracy, Bulgaria is seen by some of the respondents as prime-ministerial democracy. A respondent with executive civil service experience observed that the political class (parties, sic) finally learned how to effectively overpower business actors, most of whom are now largely made dependent through the opportunity to make political appointments and the threat of being victims to PRIs (or vice versa). A number of respondents with rich civil service and political experience freely spoke of the community of the privileged or families, for whom a party change was of no consequence as they had equal access to all political parties. Another common theme among respondents was that sectoral groups did not effectively defend the interests of their members because either group leadership itself or major sectoral players defected and colluded with the party in power in exchange for tailored protections, concessions or benefits. Another respondent confided that he denounced his trade association membership because he saw them as colluding with the political elite against the entire sector. The underlying suggestion in both cases was that big sectoral players or sectoral leadership sought to form a community of the privileged with the ruling party. Finally, to the above we can add the case study on the National Council for Tripartite Cooperation (NCTC), which is discussed in later chapters. The case reveals that party-initiated civil service reforms can either grant or block access to civil service consultations, lending themselves as a tool to prevent political opposition. This is another parentela dynamic, which adds to the centrality of Bulgarian political parties. All things political begin and end with them. That is why, political parties are attractive. From the perspective of the group they are the most effective policy venue, because it is at this level that decisions are binding. But whether this route is open to all and any groups is another question. A number of respondents shared from personal experience that political parties were not interested in technical information. In fact, they suffered from incessant need for campaign funds. As practitioners report, regrettably, actual campaign costs are many times higher than what state subsidies could compensate political

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parties for. That is why groups with campaign resources are most welcome. But where is the surprise in that? The importance of that is that the party enters an exchange relationship with informal group. From that moment on, both actors are bound by their mutual assistance. Against privileged access provided by the party, the insider will provide campaign resources. The ability of the one actor to provide the resources they promised means that it is in the interest of the other one to stay in the relationship and support the other. That is, mutual support. We can therefore, see the party and its insider from the larger perspective—as a core of sorts. La Palombara, for example, advances the term parente to refer both the insider and to the ruling party (1964). This is the unit of elite in the extended parentela network. The present book identifies the parente is the elite and it can grow. With its coercive arm, political patronage and the ability to introduce civil service reforms means that the parente has all instruments to exert pressure to political and business rivals or consolidate political power, if so necessary. Again, with PRIs, the parente can counter any political and market rivals, because now the parente is an actor with one foot on the market and another one in politics. With a change in legislation, the business side of the parente can assume better market standing. For example changes in standards affect licensing and it may take precious time for some market participants to adapt. With sudden PRI raids in the offices of politically active firms, the parente can send them a message to stay away. So in short, the more affluent the business half becomes, the more capital the political half can extract in exchange for even more political access. But in any case, the point is that the parente can expand politically and business-wise and that by doing so it further attracts more and more informal participants. But what does it all mean? This means that taken together, the extended parentela dynamic combined with Parliamentary elections establishes an oligarchic dynamic. Of course, the elite expansion does not last forever. This whole process of expansion and of countering other rivals or simply engaging neutral outsiders lasts until the party from the parente loses parliamentary elections. In this case, a new party comes to power, carrying along its own insider, which either retaliates for having been under PRI pressure under the previous government or simply begins to poach neutral businesses. And it is this dynamic that the book focuses on. On the one hand, the extended parentela generates new elites, while at the same time

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eliminates others. For instance, an elite my expand through type one dynamics by assuming key civil service posts and the subsequent promulgation of favorable legislation, by winning public tender contracts or by the privatization of state assets. Or the ruling elite can choose to be aggressive and carve out a market space for itself by engaging some of its past business rivals or pressure neutral outsiders with PRIs. In any case, there are plenty of options to choose from but whichever course is taken, it takes away from other market participants, i.e. the parentela interaction is zero-sum. Dominating the distribution of public tenders or the process of privatization of state assets means that rival companies incur unrealized gains. Dominating the policy-making process and promoting respective legislation, too, allows party insiders the ability to anull the advantages accrued by previous elites. On the other hand and at the same time the parentela can be overtly destructive. A more direct way of engaging those, however, is type two parentela dynamics. They are useful not only with regards to unsuspecting outsiders but in relation to former elites. Prejudiced regulatory inspections, in other words, are the primary instrument of direct coercion available to business elites in power against their former counterparts and the market advantages they had gained previously. And again, all of the above is repeated with every party change. It is this dynamic, which the study identifies as oligarchic and later hypothesizes that could transform the state-group relationships of free competition to that of consolidated oligarchy. The description of oligarchy in the wider literature overlaps with the dynamic of the extended parentela. The final chapters reveal four key points of similarity. Both share: (1) core party insider group dynamics; (2) joint party-group control over state agencies, which are used in turn to coerce common adversaries; (3) shared identity of community; (4) the logic of conversion (Chalakov et al. 2008), or the practice of using political access not for genuine policy-making but to gain some economic capital. As it stands, each elite or parente that forms around the ruling party in Bulgaria conforms to these characteristics. Elites form on the grounds of the reiterated cooperation between the party and a privileged insider. Each successful iteration of their cooperation generates mutual trust and identification with a shared identity, i.e. a community of the privileged. Ultimately, the present book hypothesizes that if left unchecked, the extended parentela in combination of a diminished interparty competition will lead to a consolidated oligarchy. That is to say, a status quo

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where a single elite dominates the political landscape. If we currently observe an oligarchic dynamic, we can expect for it to transform, or consolidate into an oligarchic status quo. The latter does not mean a change of government or institutions, rather a change in the relations between Groups and the state. If current Bulgarian interest groups are able to compete with one another, then this would no longer be the case. In a consolidated oligarchic status quo suggested here, the democratic institutions and form of government remain intact but access to the policy-making process will be blocked by a single, coherent elite, formed around the party leadership which will share the four-point oligarchic features of the extended parentela and its dynaics, and will have at it its disposal its instruments of coercion, which will discourage any form of competition for access among outsiders. In other words, a consolidated oligarchy as seen here is the extended parentela minus the inter-elite competition. In sum, the total message the book seeks to communicate by building on previous parentela research is that present-day Bulgarian policy-making harbors oligarchic dynamics, brought about by the extended parentela, and that if those are not changed, the polity could transform into an oligarchic status quo. To effectively communicate the thesis and by an extension its hypothesis, the following Chapters 2 and 3, will continue by first constructing the parentela, then the extended parentela (Chapter 4) and finish with bringing those together in a single, coherent model in Chapter 5. Chapter 6 will act as another form of verification of the validity of the extended parentela and its hypothesis. Right now, however, before we continue with a more detailed map of the book, we have to address a particularly important aspect of the study—the research methods used in its conduct.

Methods The Bulgarian Parentela Study was conducted from 2012 to 2016. This period includes the processes of respondent identification, approach, interview conduct and also transcription, analysis, drafting and production of the final report. As already mentioned, the BPS study at its core replicates La Palombara’s which was based on 26 anonymized elite interviews. At the same time, the former was also exploratory, as no preceding research on the parentela or any other policy network existed on Bulgaria

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to guide towards any policy areas that could act as cases of the parentela. Therefore, the anonymous elite interviews were the starting point to look for cases of the parentela. Ultimately, this approach yielded results. As intended, some of the interviews provided pointers as to where to look for the parentela, thus the case study on Public Tenders in Chapter 3. In addition, the data was collected into and analyzed using the nVivo software. Let us then, briefly turn to some of the more important aspects of the research process. First is the comparison between the respondent pools. As we stated earlier, the study initially intended to replicate the elite interviews which La Palombara. The assessment of whether a comparable respondent pool was attained in the BPS, however, is based on a number of considerations, because La Palombara provides close to no description of his respondents. A careful read of his work shows that we can divide his respondents in four big categories: political parties, civil service, interest groups and various external observers (category MISC below). The first category, respectively, could be subdivided into MPs, party leaders and party advisers. The second category is further subdivided into Ministers (MIN), committee members or chairmen (COM) and directors of state business enterprises or agencies (DIR). Finally, the interest group category could be subdivided into trade association directors (TA director), members of trade associations (TA member), or single businessmen (B). With regards to the last subcategory, it is introduced in the Bulgarian case and reflects independent entrepreneurs with direct links to policy-making. The last, Miscellaneous category on the other hand is only reflected in La Palombara’s study, and it includes a journalist (J), a writer (W) and an unknown person (U). Such respondent categories were deliberately omitted as it was felt they did were not insiders enough. The very first column in the table below summarizes the respondents from La Palombara’s study in 1964. The question marks indicate that it is not possible to determine whether the civil servants he interviewed fall in any of the three subcategories (Table 1.3). The difficulty in the comparison lies in the policy-making positionality of the respondents, by which term we refer to the policy-making positions a respondent held at the interview or prior. Whether the respondents were active or retired policy-makers at the time of the interviews is impossible to tell in La Palombara’s study. At the same time, as the Bulgarian pool demonstrates, policy-makers usually have multiple backgrounds. One can be an active MP but a former Minister and trade

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Table 1.3  Respondent pools Respoment background

party (MPs) party (Leader of PP) party (ADV) party total MIN COM DIR Administration total Groups (TA director) Groups (TA member) Groups (B) Groups total Total core Misc (J and W) Misc (U) Total misc Total respondents

Conservative estimate

Multipositionally

La Palombara in 1964

BPS in 2013

BPS in 2013

3 3 0 6 ? ? ? 7 5 1 0 6 19 3 3 6 25

2 4 0 6 1 0 1 2 5 0 5 10 18 0 0 0 18

11 5 6 22 4 8 6 18 9 0 6 15 55 0 0 0 55

association leader, for example. Moreover, should we also take into account one’s longevity in policy-making? Surely, interviewing someone who is recently retired from politics but with a 30-year experience carries more weight than someone who is an active politician at the time of the interview but has just made it in. These were the major considerations when comparing the two respondent pools, which were necessary not only for the sake of replicabitliy but of results validity as well. Again, for results to be valid, we are interested in respondents with closest possible access to policy-making and with the richest possible policy-making experience. Therefore, the best way to demonstrate the validity of the results and the similarity of the respondents pool is to convert both respondents pools to a common numerical scale. The study devised, therefore, a points-based system of a respondent’s embeddedness in the policy-making process. For each policy-making position the respondent will be given one point. The higher the points, the greater the embeddedness, hence, validity. This system comes in three types: conservative, multipositional and temporal. In the first

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variant, the counting is limited to the highest policy-making position the respondent holds at the time of the interview. This is a very simplistic counting system and is not reflective of the complexity of a respondent’s positionality. This comparative mechanism, however, can only be adopted in the present study, as again, La Palombara does not provide any details on the background of his respondents. The multipositional approach is a counting system where all policymaking positions of a given respondent are included. A respondent, for instance, might at present be an independent entrepreneur with residual contacts with policy-makers because he himself has been an MP once. Needless to say, this counting system provides considerable depth and allows for the more nuanced pool profiling. This also enables us to observe and potentially measure pool bias and pool saturation. The former refers to some respondent categories better represented in one pool than the other, while the latter refers to the actual multipositionality points count between two subsets. We might have 10 ministers in each respondent pools A and B, but it might be the case that the ministers in pool B have richer policy-making experience in terms of previous positions held in their professional lifetime. In any case, multipositionality brings us to temporal positionality. It stands for respondent’s longevity in policy-making and the period when that took place. Temporal positionality here is measured in terms of parliamentary sessions, i.e. the 21st Parliament of 2000–2004. This, say, is equivalent of saying ‘He was a Director of a Trade Association during David Cameron’s government’. This counting system was chosen also because this is how people measure political time, using someone’s government as a reference point. We adopt the same principle but instead of someone’s government, we use the ordinal number of the Parliament’s session and the time-period that Parliament was convened. This is illustrated in the very detailed table of the Bulgarian respondents in the Appendix. So, again, with temporal positionality, we measure periods of time, while also making a specific reference in time. This adds another comparative dimension between respondent pools, which could also reflect biases in terms of uneven respondent spread in the historical time line of Parliaments. But it is also further reflective of a respondent’s reliability. Again, a retiree might hold no active policy-making position at the interview, but have 30-years experience of policy-making. This is another measure some quantitative potential which was not further developed in the study, because of small scale of the pools and lack of information on La Palombara’s respondents.

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So, having clarified the core principles behind the comparison, is there anything we can say about the actual pool compared? Conservatively speaking, the respondent pools are comparable, although the Bulgarian pool—one might argue—has a better focused respondent base. Looking back at the respondent-comparative Table 1.3 above, we can see that the studies involved the same number of respondents with a background in political parties. At the same time, it seems that civil servants in the BPS are underrepresented compared to in La Palombara’s, with two from BPS against seven, respectively. On the other hand, one might argue that La Palombara’s pool lacks representation of businessmen with close ties to the government (B), which is still an important aspect. So, although, there would normally be parity in the representation of interest groups between the studies (5 + 1(TA director + TA member) for La P. vs. 5 (TA Directors) for BPS) the introduction of business owners would suggest that the Bulgarian pool features a more accurate representation of the interest group sector by including solo business players with insider access to policy-making. Furthermore, the two pools differ significantly in the miscellaneous category, which refers to observers of policy-making, such as journalists or writers. The BPS did not consider those to be valid respondent categories at the time, and so opted for the business category. So, the present author would argue that, in terms of conservative positionality, the BPS respondent pool is comparable to La Palombara’s but better focused on respondents with policy-making background. The other important aspect of the study was the selection, approach and contact of the Bulgarian elite respondents. The major difficulty was that many respondents, including those who agreed to give an interview perceived the researcher as a threat: domestic or foreign. The researcher, for example, was seen with suspicion because of his association with the West, which attitude did not come only from those respondents with socialist/communist background. Some of them distrusted the West simply because there are no friends in business or politics, and so this study and the researchers were an instrument of subversion. The solution was twofold. First, because the researcher was seen with distrust, an emphasis was made to attract those individuals who are at the periphery of policy-making at the time of the study. The study considered the following respondent types when making selections (Adler and Adler 2001: 523): frustrated (dissatisfied/ax-grinding), outsiders (those in the periphery of the policy-making process, while still having a vantage

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point), old-timers (those who are retired and cannot fear repercussions), outs (not involved any more but still have some information), neouveau statused (those who brag about their new position), rookies (those who are too naïve), subordinates and needy (attention seekers). Most respondents in the Bulgarian study were recruited from the outs, outsiders and old-timers. Other respondents also came from the frustrated and the needy (also discussed below). In addition, and specific to this research, a new category could be added. These are the desperate respondents, who do not care of any repercussions, because they feel they have lost everything. The above selection approach was combined with a novel interview approach, namely, the involvement of a new research participant in the interview: the intermediary. Their help was not only in the discovery of relevant respondents, but also in their personal introduction to the researcher, vouching for researcher’s credibility and ultimately participation in the interview. As the subject matter was very sensitive, it was through the intervention of said intermediaries at the actual interviews that relaxed the respondents enough to share with the researcher information that they would not otherwise have. The details of the difficulties in conducting elite interviews in the study are discussed at length in a joint-paper with Lambros Kaoullas (Petkov and Kaoullas 2016). It suffices to say, that the low respondent count is largely due to the rampant distrust in the Bulgarian political system which by an extension translated on the present research. As one respondent intimated, this distrust may be justified as he witnessed the exposure of another social scientist as an agent of a foreign intelligence service. In the interview, one should also mention, the respondents appear in the book with pseudonyms in order to maintain their anonymity. Finally, the research project also made use of case studies. Two case studies out of three from the original BPS study Petkov (2016) will be included here. The important bit to say about them is that they followed the principle of process tracing (Tansey 2007; Falleti and Lynch 2009; Falleti 2006; Checkel 2006). This means that the accumulated data and its interpretation was geared towards the development of causal sequences or processes that link theorized phenomena. Furthermore, in addition to interviews, the case studies also made us of state reports, legislative texts, juxtaposed memoirs, news articles and evidence submitted to Parliamentary consultations. The case on Public Tenders in Chapter 3 is one such example, as the parentela was perceived as a process.

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The process tracing analytical approach was also employed in the analysis of the interview data pertaining to parentela, which has led us to the revision of the second parentela type as a party-centric model of an oligarchic dynamic. Now, without further ado, we will turn to the last section of this chapter, which maps out the remaining chapters.

Structure of the Book The present book is an analytical refinement of a doctoral study conducted recently, referred here as the Bulgarian Parentela Study (Petkov 2016, 2017). The previous report did not only document that the model existed in Bulgaria but it also showed new variations in its dynamics which we have labeled type two parentela, in order to distinguish them from La Palombara’s original model description (type one) (Petkov 2017). What has prompted the present publication is that the earlier report could not fully articulate the view that the extended parentela (i.e. types one and two combined) can also be treated as macro-level model of oligarchic dynamics, that have the potential to consolidate into an oligarchic status quo. And this, in turn, is the purpose of the book. It reimagines the parentela, or more specifically, the extended parentela as a model of party-centric oligarchic relations. But Why, one might ask, is this at all relevant to anyone? What is the significance of the parentela and why should we all care? The short answer to these questions is that because we need to know who actually governs. The objective of the policy network literature was initially to expose the realities of democratic policy-making, by pointing out that formal democratic institutions do not explain the actual policy-making process. The group policy-maker interaction is complex and largely informal. Richardson and Jordan (1979) clearly demonstrated that British policy-making is based on an informal set of rules such as, among others: depoliticization of issues, compromises, consensus-seeking and keeping a low profile. As one such policy network type, we should therefore care about the extended parentela as it introduces much greater realism in present-day Bulgarian policy-making, which should be of immediate concern not only for Bulgarian citizens, but for the wider academic community, because the model could be applicable elsewhere. As Chapter 6 will demonstrate, the tenure of President Kuchma of Ukraine gives credence to the proposed relationship between the extended parentela and the arrival of a new, oligarchic, status quo. This is not a formal change

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of government, one should hasten to say. Rather this is a change of the state-group relationship, where policy-making and non-policy-making will be sanctioned by an elite comprising political parties, insider business groups and obliging civil servants. The model, in other words, has the potential to be applicable to states outside Bulgaria and demonstrates that nondemocratic dynamics can just as well be embedded within formally democratic institutions. That in turn is important to citizens, politicians and academics alike as the extended parentela has the potential to demonstrate the mechanism of a state’s detour from democratic policy-making even if its institutions formally remain democratic. The following chapters, therefore, will gradually construct the oligarchic model, as follows: Chapter 2 will demonstrate the elements of the original parentela in the Bulgarian context as seen from the perspective of the 26 elite respondents from the study. However, it was also mentioned that finding the elements of the parentela is not the same as finding the parentela as a whole and in motion, so to speak. Chapter 3, therefore, is again dedicated to La Palombara’s parentela in Bulgaria, but this time we can observe the model in its totality by looking into the process of the distribution of Public Tender contracts. Chapter 4, then, moves forward to the presentation of the newly discovered prejudiced regulatory inspections as the second parentela dynamic (or type two parentela). The details of this new dynamic and its causes are discussed therein. Chapter 5, next, brings together the two parentela dynamics (that of La Palombara’s parentela and prejudiced inspections) into the concept of the extended parentela. By bringing both dynamics together the chapter constructs the extended parentela as a model of party-centric oligarchic relations and hypothesizes that if left unchecked and in combination with parliamentary elections, the extended parentela will consolidate into an oligarchic status quo. Before concluding with Chapter 7, Chapter 6 verifies the validity of the hypothesis and the extended parentela model by further looking into the case of Ukraine under the tenure of President Kuchma, which bears features both of the model and the hypothesized consolidated oligarchic status quo.

References Adler, P., & Adler, P. (2001). The Reluctant Respondent. In J. Gubrium & J. Holstein (Eds.), Handbook of Interview Research (pp. 515–535). Thousand Oaks: Sage.

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Atkinson, M. M., & Coleman, W. D. (1989). Strong States Weak States: Sectoral Policy Networks in Advanced Capitalist Economies. British Journal of Political Science, 19(1), 47–67. Borzel, T. (1998). Organising Babylon: On the Different Conceptions of Policy Networks. Public Administration, 76, 253–273. Chalakov, I., Bundzhulov, A., Hristov, I., Deyanova, L., Nikolova, N., Deyanov, D., et al. (2008). The Networks of Transition—What Actually Happened in Bulgaria After 1989? Sofia: East-West [Чaлъкoв, Ив., Бyнджyлoв, A., Xpиcтoв, И., Дeянoвa, Л., Hикoлoвa, H., Дeянoв, Д., Mитeв, T., Cлaвeнкoв, Б., Cимeoнoв, O., Чипeв, П., Cтoйнeв, B., Фeлиcи, Cт. (2008). Mpeжитe нa пpexoдa – Кaквo ce cлyчи вcъщнocт в Бългapия cлeд 1989. Coфия: Изтoк-Зaпaд]. Checkel, J. T. (2006). Tracing Causal Mechanisms. International Studies Review, 8(2), 362–370. https://doi.org/10.1111/j.1468-2486.2006.00598_2.x. Dowding, K. (1995). Model or Metaphor: A Critical Review of the Policy Network Approach. Political Studies, 43, 136–158. Dowding, K. (2001). There Must Be End to Confusion. Political Studies, 49, 89–105. Falleti, T. (2006). Theory-Guided Process-Tracing in Comparative Politics: Something Old, Something New. APSA-CP, 17(1), 9–13. Falleti, T., & Lynch, J. (2009). Context and Causal Mechanisms in Political Analysis. Comparative Political Studies, 42(9), 1143–1166. Gais, T. L., Paterson, M. A., & Walker, J. L. (1984). Interest Groups, Iron Triangles and Representative Institutions in American National Government. British Journal of Political Science, 14(2), 161–185. Grant, W. (1977). Insider Groups and Outsider Groups (ECPR Joint Sessions). Berlin: University of Warwick. Grant, W. (1978). Insider Groups, Outsider Groups and Interest Group Strategies in Britain (Working Papers, No. 1). University of Warwick. Grant, W. (2004). Pressure Politics: The Changing World of Pressure Groups. Parliamentary Affairs, 57(2), 408–419. Greer, A. (1994). Policy Networks and State-Farmer Relations in Northern Ireland, 1921–72. Political Studies, 42(3), 396–412. Jordan, G. (1981). Iron Triangles, Woolly Corporatism and Elastic Nets: Images of the Policy Process. Journal of Public Policy, 1(1), 95–123. Jordan, G. (1990). Sub-governments, Policy Communities and Networks: Refilling the Old Bottles. Journal of Theoretical Politics, 2(3), 319–338. Jordan, G. (2005). Bringing Communities Back in? A Comment on Grant. British Journal of Politics and International Relations, 7, 317–321. Jordan, G., & Schubert, K. (1992). A Preliminary Ordering of Policy Network Labels. European Journal of Political Research, 21(1), 7–27.

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Jordan, G., Maloney, W., & McLaughlin, A. (1992). Insiders, Outsiders and Political Access? (British Interest Group Project, 8). Aberdeen: University of Aberdeen. La Palombara, J. (1964). Interest Groups in Italian Politics. Princeton: Princeton University Press. Maloney, W., & Jordan, G. (1997). Accounting for Subgovernments: Explaining the Persistence of Policy Communities. Administration & Society, 29(5), 557–583. Maloney, W. A., Jordan, G., & McLaughlin, A. (1994). Interest Groups and Public Policy: The Insider/Outsider Model Revisited. Journal of Public Policy, 14(1), 17–38. Maloney, W., & Richardson, J. (1994). Water Policy-Making in England and Wales: Policy Communities Under Pressure. Environmental Politics, 3(4), 110–138. Marsh, D., & Rhodes, R. A. W. (Eds.). (1992). Policy Networks in British Government. Oxford: Oxford University Press. Pappi, F. U., & Henning, C. (1998). Policy Networks: More Than Metaphor? Journal of Theoretical Politics, 10(4), 553–575. Peterson, J. (2003). Policy Networks (Vol. 90). Political Science Series. Vienna: Institute for Advance Studies. Petkov, M. (2016). Validity and Variation in the Parentela Policy Network. Dissertation, University of Edinburgh, Edinburgh. https://www. researchgate.net/publication/317230743_Validity_and_Variation_in_ the_Parentela_Policy_Network_Conflict_and_Cooperation_between_Ruling_ Parties_and_Interest_Groups_in_Bulgaria. Last accessed 31 May 2018. https://doi.org/10.13140/rg.2.2.21329.33120. Petkov, M. (2017). The Parentela in Bulgarian Polity: Conflict and Cooperation Between Groups and the State. Bulgarian Studies, 1, 37–59. Petkov, M. P., & Kaoullas, L. G. (2016). Overcoming Respondent Resistance at Elite Interviews. Qualitative Research, 16, 4. https://doi. org/10.1177/1468794115589646. Rhodes, R. A. W., & Marsh, D. (1992). New Directions in the Study of Policy Networks. European Journal of Political Research, 21(1–2), 181–205. Richardson, J. (2000). Government, Interest Groups and Policy Change. Political Studies, 48, 1006–1025. Richardson, J., & Jordan, A. G. (1979). Governing Under Pressure: The Policy Process in a Post-parliamentary Democracy. Oxford: Martin Robertson & Co. Ripley, R. A., & Franklin, G. A. (1987). Congress the Bureaucracy and Public Policy (4th ed.). Ohio: The Dorsey Press. Silke, A., & Kriesi, H. (2007). The Network Approach. In P. Sabatier (Ed.), Theories of the Policy Process. Boulder: Westview Press.

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Tansey, O. (2007). Process Tracing and Elite Interviewing: A Case for Nonprobability Sampling. PS: Political Science and Politics, 40(4), 1–23. Thatcher, M. (1998). The Development of Policy Network Analyses. Journal of Theoretical Politics, 10(4), 389–416. Van Waarden, F. (1992). Dimensions and Types of Policy Networks. European Journal of Political Research, 21, 29–52. Yishai, Y. (1992). Interest Groups and Bureaucrats in a Party Democracy: The Case of Israel. Public Administration, 70(2), 269–285.

CHAPTER 2

The Parentela Through the Eyes of Bulgarian Policy-Makers

The previous chapter introduced the subject of policy networks and the parentela as the network type under scrutiny in this volume. The­ concept stands for the situation where a group with a privileged standing within the ruling party is able to extend her influence in the civil service by having the party interfere in the work of state agencies on her behalf. The chapter also advanced two thesis points. First, that the type of parentela dynamics found in Bulgaria greatly enriched the original model, thereby advancing the term extended parentela as a label unifying the initial dynamic discovered by La Palombara (1964) with the new parentela dynamic found in Bulgaria as part of the recent Bulgarian Parentela Study. The second thesis point, therefore, was that the total dynamics of the extended parentela are oligarchic in nature. From this, the introduction also offered the hypothesis that if left unchecked and in combination of diminished interparty competition, the extended parentela dynamic in Bulgaria will consolidate into an oligarchic status quo. The book will approach the first thesis point in Chapters 2, 3, and 4. Chapters 2 and 3 will reconstruct the parentela model in the Bulgarian political context, using data from elite interviews with Bulgarian policymakers and by presenting the case on Public Tenders, respectively. Chapter 4 will present new evidence, which demonstrates the existence of a second parentela dynamic (or type two parentela). Chapters 5 and 6 will re-imagine the extended parentela as an oligarchic model of stategroup relations, and assess its external validity by presenting the case of President Leonid Kuchma’s tenure. Therefore, this chapter will present © The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3_2

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evidence of the existence of La Palombara’s type one parentela dynamics in Bulgaria. The data below is from the 26 elite interviews that were conducted in an attempt to replicate La Palombara’s earlier study. The argument here is that type one parentela exists because we can identify each of its descriptors when overlapping the elite interviewees’ responses. We defined earlier five network descriptors which taken together can describe each of the known (Anglo-Saxon) policy network types: degree of access, power ratio, type of interaction, primary venue and venue scope. Therefore, we can say that the parentela if the 26 elite interviews described a party-group relation where the interest group has insider status (degree of access) within the ruling party (primary venue) and uses a mechanism to translate its demands into the civil service (venue scope), and is in a cooperative, power-balanced relationship (type of interaction and power ratio, respectively). We will first discuss the venue scope descriptor, which is demonstrated by the practice of political appointments, because those appointed in the civil service act as the conduit of the decisions taken by the party elite. The descriptor primary venue is also evident in the case of the National Council of Tripartite Consultations (NCTC) which shows that through civil service reforms the ruling party has the potential to enforce the interests of its insider, which means that political parties have the potential to act as the pivot in a parentela relationship. This point is further implied in Chapters 4 and 5, which indirectly discuss the primacy of the party over the civil service in the context of Public Tenders and their ability to exploit the regulatory agencies of the state. However, one difficulty is that it is hard to talk about a primary venue without at the same time talking about the venue scope. The mere act of translating decisions from one venue to another means that this dynamic bridges the two venues, hence, is demonstrative of venue scope. Yet, the same translation is also indicative of party’s superiority over the civil service, making the same data indicative of a primary venue. Likewise, the act of civil service interference through civil service reforms can also be seen both as evidence of venue scope and primary venue. As connecting the two venues in a larger dynamic. This difficulty is also true for the rest of the descriptors and the descriptor-based approach in general. It raises the question whether the classification system needs some degree of refinement. Qualitative data is multidimensional as it may pertain to more than one category. For example, the data pertaining to the descriptor degree of access is also attributable to the rest of the descriptors: cooperation and power parity. Thus, when discussing how groups

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gain insider status, we are also saying (though implicitly) that there is a power parity and cooperation. Alternatively, one may argue that it is not that the qualitative data is multidimensional, but that the descriptors are mutually connected (even if nominally discrete), because the political reality is such that certain descriptor value combinations are more likely than others. For example, is it conceivable for a group with an insider status (i.e. privileged access) to be in a conflictual relationship with the policy-makers, or an outsider to be in a balanced power relation with policy-makers? Can an insider actually overpower policy-makers or can policy-makers overpower an insider group in a cooperative manner? Is it possible for a group to cooperate with policy-makers and still be an outsider? These methodological/ theoretical complications need not concern us here, nor do they negate the results. In any case, the elements of the parentela are present, but not in such an orderly way that one would have ideally hoped. What we need, instead, is to focus on is the interview data which demonstrates the elements of the parentela. Without further ado, we will begin by discussing the descriptors of primary venue and venue scope in the following section, which will be followed by a discussion on how groups gain insider status within Bulgarian political parties. As already noted, the latter discussion is also an implicit discussion of power parity and cooperation between the two as well.

Primary Venue and Venue Scope: Party’s Interference in the Civil Service Through Political Appointments There are previous studies that have attempted to document the extent of party political appointments (PPA) in the civil service. Most recent at the time of the BPS were the studies of Kopecky and Spirova (2011) and Spirova (2012) on the prevalence of PPA in Bulgaria and on their causes, respectively. Kopecky and Spirova (2011) argue that the agencies of the Bulgarian civil service are subject to wide-scale appointments. Patronage extends to other administrative structures which ought to be filled strictly on merit and professionalism, such as hospital directors or principals. Spirova (2012) furthermore argues that PPAs are used both as a form of control and reward.

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Evidence from the BPS confirms their findings and offers a number of explanations for these values in Bulgaria. First, ruling parties use political appointments as a form of control because they distrust any external, autonomous experts, be them from autonomous civil service or sectoral interest groups. Such independent participants are seen as a threat, because their technocratic decisions fail to acknowledge party interests. A second form of administrative control spurred by distrust is when parties remove civil servants from office at the turn of a party change because appointees of the previously incumbent party are expected to sabotage the new government. Third, also in agreement with Spirova (2012), parties need political appointments in order to help maintain intraorganizational cohesion by using patronage as a form of reward. Finally, it also needs highlighting that the above practices are facilitated by the legal framework which enables PPA at central and local administrative level discussed below. In a comparative study on political appointments in Eastern Europe for the period 2006–2008, Kopecky and Spirova (2011) develop a coefficient (index) of patronage. At the center of their study lie Bulgaria, Czech Republic and Hungary. Their data shows medium rate of PPA in the three states (2011: 906–911, Kopecky and Spirova 2011: 907). The index values are grouped in three levels of PPA as follows (Table 2.1): Table 2.1  Levels of PPA (Kopecky and Spirova 2011: 907)

State UK Netherlands Denmark Iceland Norway Portugal Ireland Czech Republic Spain Bulgaria Hungary GermanyItaly Austria Greece Mean

Coefficient of patronage 0.09 0.11 0.16 0.23 0.28 0.29 0.32 0.34 0.4 0.42 0.43 0.43 0.47 0.49 0.62 0.34

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0.65 appointments occur in most institutions at all levels; 0.4 appointments occur in most institutions at top levels; 0.1 appointments are very limited and if any, at top levels. An index of 0.42 is a measurement of a medium level of PPA (Kopecky and Spirova 2011: 906) and according to the authors, this value places Bulgaria in the middle of a European-wide rank list of states with political appointments, the coefficient of 0.42 is a mean that hides significant internal imbalances. There is still a wide spread of political appointments both horizontally among top directorial levels of most institutions and state agencies, and, vertically, down to local and middle level in each ministry, reaching to positions far removed from party politics, such as school principals, hospitals, museums, etc. (Kopecky and Spirova 2011: 908–909). In a 2012 follow up article, Spirova, Meir and Kopecky review political appointments in the Bulgarian civil service for the period between 2000 and 2005, conducted by the private polling agency MBMD (2012). The data from MBMD also indicated a high level of political appointments as of 2005. In fact, both studies combined from 2000 to 2005 (MBMD in Spirova 2012) and from 2006 to 2008 (Kopecky and Spirova 2011) indicate an overall upward trend of PPA in Bulgaria. The MBMD study conducted in late 2005 to early 2006 asked 922 civil servants twice the question (in 2000 and in 2005): ‘Do you believe that political appointments in the state administration happen often/sometimes/never?’ The results indicated an upward trend of political patronage. Those who believed no political appointments existed in 2000 (40%), reduced in half by 2005 (less than 20%). Those in 2000, who believed that there were often political appointments, rose approximately 3 times by 2005. Overall, if we add the MBMD results to the results from Kopecky and Spirova (2011) we could observe an upward trend of political patronage in the Bulgarian civil service from 2000 up to 2008 (Fig. 2.1). The above data is enough to claim that the ruling party and civil service venues are connected by the practice of party appointments, which facilitates the parentela formation. Surprisingly, however, a stronger link between this observation and the parentela inadvertently comes from Spirova (2012). Political appointments are so prevalent, that in her attempt to summarize her results, Spirova inadvertently paints the image of the parentela (Spirova 2012: 64–65):

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Fig. 2.1  Do you believe that political appointments in the state administration happen often/sometimes/never? (Spirova 2012: 60) As a result, a lot of the positions in the agencies that regulate the economy [including] agriculture, transport, and infrastructure were staffed with party appointees who could ensure that the important decisions were also taken with the economic interests of the political parties, or of private companies friendly to them, in mind.

The description above identifies political appointments as the result of preexisting agreements between the party in power and its insider groups. Simultaneously, one can also read the above excerpt as evidence of the primacy of the party venue over the civil service. Interview responses from the present study corroborated the findings of Kopecky and Spirova (2011) and Spirova (2012). Interview responses indicated an overwhelming breadth of PPA rendering the question superfluous. Stated with confidence, nearly every one respondent who was asked to address the topic of appointments complained on the depth of appointments down to local level. Some extreme examples included the ejection of school janitors at the turn of elections. Again he prevalent agreement among interviewees on the wide spread of the phenomenon rendered the continued pursuit of this theme unnecessary.

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Other evidence of the extent of political patronage is easily observable in the current legislative framework. The laws on Administration 1998 (LA) and Local Self-Government and Local Administration 1991 (LLSGLA) greatly facilitate political appointments. The early clues as to the importance of these pieces of legislation came from Kopecky, Mair and Spirova (2012: 56) who identify a handful of authors discussing the legislation that governs the conduct of the civil service and the historical origins of PPA (Shoylekova 2004; Dimitrova 2002; Bozhidarova et al. 2002). However, there is very little in terms of discussion on how exactly the Laws facilitate appointments, which is of importance for the present study on the parentela, and which we will address below. The Law on the Administration (1998) reveals the legal connection between the party and civil service venue, as it clearly enables the ruling party to make political appointments. The following Fig. 2.2 charts the vectors of appointment in the Bulgarian civil service. The shape where an arrow starts marks the appointing body and where the arrow ends mark the politically appointed position. The main appointing bodies are the prime minister and individual ministers, denoted with blue triangles. The main and most relevant in our case appointed bodies are the agency directors or commission chairmen, which are denoted with blue rhomboids. Other appointed positions less relevant to our case are political cabinets and oblast governors, which are denoted with blue squares. In addition, there are trapezoid shapes whose purpose is to give more details on the specific articles from the Law on the Administration 1998 that govern the appointment in question. The respective articles are denoted in brackets “( )”. The same reference system is employed throughout all elements in the figure, where relevant articles from the LA 1998 that codify the relationship are noted in brackets. Finally, every one element has a unique reference number, noted between two short dashes, e.g. “-12-”. Overall, a relationship of appointment is expressed as the collection of all shapes that lay in the path of a connector that starts with a triangle and ends on rhomboid or a square (Fig. 2.2). The LA offers direct and indirect procedures available to the central party leadership (the prime minister and party functionaries equal in rank) to make PPA. The direct ability to make a PPA is embodied in the right of the leader of the party in power (the Prime Minister) to and terminate employment of directorial (top-level decision-making) positions in the agencies that regulate the business and public activities in the state, and deputy ministers. The LA is quite clear that the Prime Minister has the right to offer and terminate employment to directors in

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Fig. 2.2  Structure of political appointments in Bulgaria: central executive

the state agencies (LA 1998 47(6), -1, 19, 27, 28-) and state commissions 50(5) (-24, 26, 28-). The former are agencies created by the Ministerial Council (the Government) (LA 1998 47(1), -28-) in order to support the policy-making activities of the Government. The latter is a structure created to manage issues related to permits emanating from and related to legislation (LA 50(1) -26-). The LA 1998 also specifies that the Prime Minister can offer and revoke deputy ministers positions (LA 1998 23(6), -1, 19, 20, 21-). These rights are further facilitated by the provision in the LA (1998

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19a(2)) which states that whoever makes the appointment, be that the party leader (Prime Minister), the Minister or the Government (the Council of Ministers), has the right to an immediate retraction of such contract (-19-). In other words, not only is the central political leadership of the party in power able to make appointments in the central executive agencies, but these are further eased by the ability to remove from office without the obligation to give notice to the respective civil servant. The powers of the party leader to appoint do not stop there. There are indirect ways in which they can influence political appointments in the administration. These powers relate to the employment of directors of executive agencies. These are created by the Council of Ministers (LA 1998 54(1) -18-) in order to help carry out the duties of the Ministry. Here, employment and its termination are vested in the Minister with Prime Minister’s coordination (LA 54(5) -17, 18-). The only positions under the direct control of a minister are the executive agencies established locally to support the operation of their ministry, directorates (-16-), and the staff of each ministry (40(1) -14, 15-). The law states that it is the Minister who has the sole right to offer and terminate employment in their Ministry (LA 1998 42(5) -14-). However, given the fact that the Minister owes their position to the party leader (-2, 3-), it is highly likely that informal coordination occurs for specific appointments of interest to the Premier. This means that even those positions that do not directly fall under the powers of appointment of the prime minister could be informally subject to their influence because ministers owe their positions directly to them. For sake of completeness, we should discuss head secretaries of the central and local administration and political cabinets. The former positions stand for top level civil servants in the state administration whose duties are primarily to ensure the internal departmental cohesion and legality of all taken actions. These positions too are political appointments made by the relevant Minister (-10, 11-). As it was established above, this should not obscure the fact that due to internal party loyalty, a Minister’s right to appoint does not preclude the political leadership of the party in power from influencing the nomination. Political cabinets are committees of advisers in the office (or kabinet in Bulgarian) of each of the organs of central and local executive power: e.g. Minister (-13-), Prime Minister (-32-), Regional Governor (-6, 7, 8-), Mayor (next section). They do not have immediate duties and responsibilities with regards to the functioning of the administration,

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but advise their patron on political and administrative matters. It is possible, in theory that a parentela could occur at these levels, although it was only Petkov who discussed political cabinets as examples of political appointments under external nominations. Powers of appointments vested in town mayors are analogous to those of a prime minister. They manifest themselves in mayor’s or rather the local ruling party’s ability to appoint their deputies and civil servants (obshtina) as permitted by the Law on LLSGLA 1991. Article 39 of LLSGLA grants a mayor the power to appoint deputies. Article 43 refers to the administration of local councils, where ‘[t]he mayor of the obshtina appoints the secretary of the obshtina for an unlimited period of time’ (43(1)). The duties of the latter are to internally organize the work of the administration of the city council. Article 44(1)3 specifies that the mayor appoints and removes deputy mayors, the chairmen of the administrative units on an obshtina budget, directors and servants in the obshtina administration. It has to be stressed that on a local level, the party a mayor represents is able to make political appointments throughout of the city council administration. Figure 2.3 summarizes the discussion.

Fig. 2.3  Structure of political appointments in Bulgaria: local executive

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There are a number of authors who see the practice of political appointments as a heritage from political culture of previous authoritarian political systems. Bozhidarova et al. (2002) link PPA with the heritage of Ottoman political culture and Soviet influence, both of which rested on personal allegiance to a centralized executive. The authors stress that the present practice of political appointments is reminiscent of the Bulgarian civil service during its totalitarian socialist period (Bozhidarova et al. 2002: 3–5). Accordingly, one of the main characteristics of the Bulgarian socialist civil service was the extra layer of civil servants, i.e. the political nomenklatura, which were politically appointed and were tasked to oversee the work of expert civil servants, observing thereby party policies implementation (Bozhidarova et al. 2002: 5–6). The same argument is also made elsewhere by Kopecky and Spirova (2011: 898–901), Raychev and Stoychev (2008), and Chalakov et al. (2008). Data from the present study tends to add some credence to such historical indebtedness to previous authoritarian forms of government. Kuzmanov was probably the strongest supporter of the argument that the predisposition to corruptive behavior is residual from the times of the Ottoman Empire, where informal monetary compensations were the norm when dealing with Sultan’s civil service. Similarly, Georgiev argued that ‘to give in order to receive’, or do ut des, was the core of Bulgaria’s policy-making informal mode of interaction with the central administration. Golemanov was vehement that the informal administrative dynamics employed today are direct reapplication of the repressive style of socialist Bulgaria pre-1989. However, while many respondents had tidbit historical references to socialism, overall with the exception of Golemanov, no respondent made an explicit link between political appointments and any other preceding Bulgarian form of government. The analogy did not suffice for an explanation, it seems. Responses instead suggested that it was the total system-wide political distrust which necessitated the use of political appointments. The ruling party distrusts experts from interest groups, because their loyalty lays elsewhere and their solutions to policy problems do not necessarily reflect the goals of political parties. Reciprocally, interest groups distrust political parties for their cadres’ lack of expertise to arrive at industryefficient solutions. This mutual distrust manifests itself in the appointment of civil service department and agency directors. Party members may promote experts from the party ranks that may combine both recognition of sectoral groups and party’s trust. However, it is doubtful whether this alleviates distrust because, as Petkov explains, regardless

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of the technocratic predispositions the appointee may have at the start, his loyalty will always shift towards the party political patrons soon after assuming the appointment. Ultimately, the distrust towards all other non-insider and non-party actors forces ruling parties to maintain a firm hold over civil service nominations. As a result of the same distrust, newly incumbent parties do not hesitate to sweep out their predecessor’s appointees. Respondents from the study were unanimous that no party in power can afford to retain appointees from rival parties. The threat is that civil servants of rival political parties, acting on the commands of their former, patrons would actively seek to sabotage the new government. As a result, every new election is accompanied by “sweeps” of mass replacement of “old” civil servants with “new” ones. Indeed even where servant nominations originate outside the ruling party, the actual appointment is still sanctioned by the party in power. These are cases of agreements between party and insider groups, or when the party needs to appease party factions and (lesser) coalition partners (Kuzmanov). Party factions in particular may feel un-represented in the executive branch and long-term functionaries may also grow resentful if they do not see their contribution to the party rewarded with a prestigious post. This is a corroboration of the same argument Kopecky and Spirova (2011) and Spirova (2012) made above. In congruence with their findings, evidence suggests that party leadership attempts to appease intraparty factions by endorsing their nominations in order to maintain inner party cohesion. In other cases, appointees nominated from the sectoral associations may be endorsed by the ruling party in order to create an air of impartiality. But as one respondent argued, even if non-partisan technocrats are employed at first, they will eventually subdue to party pressures in the long term. Further in the context of primary venue and venue scope, let us now turn to civil service reforms as another form of party interference in the work of the civil service. Through Civil Service Reforms In the founding study on the parentela, La Palombara cites party’s ability to interfere in the work of the civil service as a key element in the parentela formation. One such form of interference were political appointments, which we discussed above and also which served as an illustration of the primary venue and venue scope descriptors. The basic parentela

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dynamic is such that decisions made between the party and its insider group are enforced onto the civil service. This practice is simultaneously demonstrative that the party is the primary policy venue and that the venue scope encompasses the party and the civil service. Furthermore, the previous section also demonstrated that this enforcement is facilitated by political appointments. The present section, on the other hand, will demonstrate that civil service reforms could also be used to the same end. In addition to political patronage we can say that civil service reforms can act as another form of party control over the civil service. This is best observed in the case of the National Council for Tripartite Consultations (NCTC), which Zlatarov brought up. The NCTC is Bulgaria’s main consultative body where business, workers and the state (civil service) meet and discuss matters of primary interest to the entire economy, e.g. minimum wage, standards, contracts, etc. Respondent Lyubenov argued there are consultations at all levels of the civil service, the treasury, Bulgarian National Bank, but most important of those are at the NCTC. Hristov also singled out the National Council for Tripartite Cooperation (NCTC) as the main and most important consultative body. Other respondents such as Zlatarov, Konstantinov, also highlighted the prime importance of NCTC that has for business. Respondent Zlatarov noted 50 consultative bodies where his peak1 organization (Bulgarian Chamber of Commerce and Industry (BCCI)) was in frequent bureaucratic consultation. While noting the importance of NCTC, many respondents saw the consultative body as a contested ground between Big Enterprises (BE) and Medium/Small Enterprises (SME). The BE/SME distinction was introduced by Respondent Nikolov, where Big Business comprises dominant market actors in the economic niche they occupy, including individual firms, corporations or individual business owners. SMEs consisted of small shop owners, producers, merchants, also including what Respondent Zlatarov termed ‘micro’ firms of just a few people. Reasons to suspect that BCCI was in a secret conflict with a party insider group came from two cases from the life of the NCTC. They were shared by a number of respondents who suggested that core party insiders deliberately attempted to disrupt civil service consultations in order to

1 A

trade association that represents an entire sector(s) of the economy.

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prevent effective opposition from party outsider groups. In the first case, Zlatarov cited the attempted amendments in the Labour Codex from 2011 as evidence of BCCI being targeted for exclusion from the tripartite consultations because it was the only organization, part of NCTC, that did not meet the new participation criteria. Zlatarov’s analysis led him to suspect that their rivals, the Confederation of Industrialists and Employers in Bulgaria (CIEB) were behind it and that BCCI not meeting the legal participatory requirements for participation at NCTC was simply the necessary pretext for their removal from consultations. As Zlatarov explains, according to the amendments in the Labour Codex at the time, any interest groups that received subsidies from the state were forbidden representation as independent actors at NCTC consultations. However, the internal legal analysis of BCCI concluded that it did not receive subsidies from the state, but had been paid for services that had been outsourced to them. According to Respondent Zlatarov, ultimately, that was a move by CIEB to eliminate their rival interest groups from competing for influence in the NCTC policy venue, i.e. BCCI. There are a number of sources that support Zlatarov identifying CIEB as the party insider group that sought to oust BCCI from civil service consultations. A public statement from BCCI from 16 December 2011 also identifies CIEB as the group that stands to gain from the legislative amendments (bcci.bg 2011a): The statement from the (interested in the BCCI’s removal) organization CIEB is an absolute insinuation, namely, that at some point in the past […] the European Commission or any other such body had stated that BCCI was the inappropriate [consultative] social partner.

The MPs Pavel Shopov (bcci.bg 2011d) and Todor Velikov (bcci.bg 2011d) clearly voiced the same concern. From the parliamentary tribune, the latter states (bcci.bg 2011d): You (to MPs from ruling party) are making this in service to CIEB, because these people (BCCI), deprived from their representation, will have to find it in CIEB. But who does CIEB represent at the moment in our country? – Large capital! […] We will deprive small and medium business from representation and we will redirect them to the larger capital which is of a doubtful origin. Why are we doing all this? In whose service? In

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service of someone who at the moment wants to take over the entire employment market, to stand next to the government and say: I am the legitimate one, I want all [public tenders] to be given to me and I will dictate the status quo in this state!

Although not spelling CIEB out, the MPs Rumen Petkov (bcci.bg 2011b) and Martin Dimitrov (bcci.bg 2011c) also confirm the parliamentary opposition’s stance that BCCI is the intended group for exclusion. The gravity of BCCI’s reaction and the numerous MP statements indicate that CIEB most likely were in some sort of a tacit agreement with the ruling party, although no such direct evidence could be found in the course of the BPS. Two points emerge from Zlatarov’s thesis: one, that the Bulgarian bureaucracy provides poor consultative fora, and two, that this is due to the influences from party insider groups. In the case of the NCTC, not only is it a forum that provides unsatisfactory consultations to begin with, but those were manipulated by the rending of BCCI as the ineligible to participate. This was an act, which Zlatarov saw was masterminded by CIEB. There is a host of respondents and documents in clear support of Zlatarov’s first point. Among those most vocal was Nikolov who argued the civil service is not capable to carry out the necessary legislative consultations, otherwise known as: assessment of the legislative effects on business. His observation was also corroborated by the state report on the development of the state administration 2014–2020, We are Working for the People: Strategy for the Development of State Administration (Council of Ministers Accepted 2014; Bulgarian Council of Ministers of Bulgaria 2014). The document clearly specifies that one of the current deficiencies of the state administration and government is the turbulent production of secondary legislation that lacks any assessment of its effects on businesses (Council of Ministers 2014: 10). The report concludes that the Bulgarian civil service does not carry out the necessary level of intensive consultations to determine whether any proposed legislative amendments are acceptable to those potentially affected (Council of Ministers 2014: 11–12). It attributes the deficient consultations in general, to civil servants’ general disinterest in taking up the issues voiced by interest groups and much less, if at all, to the lack of material resources (Council of Ministers 2014: 12). Again, this means that SMEs

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are ineffectively consulted primarily because the administration has limited professional capacity to facilitate such consultations. The civil service administration admits in its own evaluation (Council of Ministers 2014: 12): [t]he directors and civil servants […] do not recognise this duty as primary and do not input the necessary effort to understand better the approach and logic of the effects of the [respective] legislation.

In other words, the deficient consultative access SME experiences is primarily attributable to an inherent civil service disinterest in doing so. The quotation suggests even if groups accessed and dominated the venue, the latter would prove itself an ineffective vehicle to ensure the desired final legislative shape. This may not be due to group’s lack of expertise, as it would be the case with the policy community for example (Jordan and Richardson 1979), but first and foremost, due to an inherent institutional inability to facilitate group consultations. However, against the background of party political patronage, such an inability already implies that effective and binding decisions are taken at the level of political parties. Moreover, if the civil service is subject to party subordination, then it is not surprising that it is disinterested to consult. This leads us to the Zlatarov’s second point, namely, that party insiders disrupt executive consultations. This view is supported by a host of respondents, although they agreed with it in principle, as opposed to with specific reference to the NCTC. They argued that it is commonplace for the more affluent businesses to split away from their sectoral organization and seek direct representation to the party in power. Respondent Nikolov was quite specific that individual Big Business actors sought the access to ruling political parties. In exchange for benefits to individual MPs or the party parliamentary groups, they received favorable legislation. That is why one could observe legislation that directly harms the interests of small and medium size businesses. But the thrust of the argument, however, was that consultations outside the ruling party are meaningless. He argued that once decision is in direct party-group negotiations its parallel deliberations in Parliament serve no purpose. Moreover, the position of the peak association is undermined, when such large splinter corporations express independent, and often opposing, positions in private to the party in power (e.g. the respective Trade Association).

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The view that single big business owners (groups) would seek to circumvent their respective representative body and directly negotiate with the ruling party was also reflected by Kirilov. They argued that sectoral bodies that represent the interests of small and medium size businesses, such as Bulgarian Industrial Association (BIA) are not an effective medium of representation for Big Business. Single affluent businesses find it more effective to engage directly with ruling political parties. This observation is also made by Konstantinov as well. In an overlap with the Council of Ministers Report (2014) he argued that civil service does not inquire into the effects of the legislative drafts to the economy and the reason for that is that the legislative decisions endorsed by the civil service are those taken in direct consultations between the ruling party and its insider. He argued that the civil service consults, but those consultations either sabotaged or nonexistent. Similar to Nikolov above, he also implied that there are more influential party-group relationships which are sustained on the mutual exchange of policy-making access against campaign resources (discussed later). Two other respondents were more direct in their identification of the civil service as the much weaker venue than the ruling party. Hristov shared essentially the same observation with Nikolov and Kirilov that the party route is more effective than the civil service one, as long as the group is able to negotiate its provision of campaign resources for desired policy concessions. Likewise, Zlatarov also agreed that the party route is more effective. Speaking from personal experience and on a different matter, he explained how the large corporation they personally represented sought to amend the details of a piece of legislation that directly affected it. He was very particular that the state administration did not have the capacity to assist them. That is why, the first thing he did was to directly seek immediate personal endorsement from a member of the ruling party who facilitated the contact with the responsible Minister in question, who ultimately resolved the matters. All of the respondent positions so far seemed to support the idea that CIEB—the group representing the interests of Bulgaria’s Big Business could indeed have approached the ruling party. However, the study did not find direct link, plausible as it is. But even if it were true in principle that party insiders can overrule civil service insiders by having the ruling party impose criteria for participation in the NCTC consultations, it may not be true in the case of the NCTC, which in a turn of events might serve us to make another argument. Zlatarov also cited the amendments in the Law of Public Property

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of Former State Workers (term for civil servants, sic) 20132 as another example of the attempt to exclude BCCI from NCTC consultations. He explained that according to those amendments, the chairmanship of all groups seeking representations at tripartite consultations (labor, business and the state) had to declare their income to assume such posts. Access to the consultations was conditional on chairpersons of the boards from all represented groups disclosing all sources of their income. Zlatarov claimed firstly that this is against the spirit of the law, which was originally intended for state agencies only and not interest groups. Second, he also added that interest group board members became unnecessarily vulnerable to intimidation and extortion as they had to reveal publicly personal financial data. The crucial point here is that contrary to Zlatarov’s suggestion that it was again CIEB, this amendment affected equally all group participants at NCTC consultations, including CIEB. In fact Zlatarov’s second argument that the later amendments rendered group consultative participants as vulnerable was clearly manifested on the website of their adversary, the CIEB, where all employer associations at NCTC signed a declaration of discontinuation of participation in the tripartite NCTC consultations (CIEB 2013). The declaration highlights the anti-constitutional provision of the amendment and clearly states that the requirement of income disclosure puts groups’ directorial boards at personal risk (CIEB 2013, emphasis added): II.1. The members of the executive and directorial organs deem that [… requiring] data of their assets be published online, creates conditions for pressure (on them and their families), not only political but criminal as well.

The quotation makes the surprising revelation that all sectoral NCTC participants see this push for redefinition of the consultative access criteria as a mechanism to shape NCTC consultations in a way to dampen or remove any sectoral policy opposition. In the context of the parentela, this turn of events renders the question whether CIEB really tried to oust BCCI as irrelevant. The point we are interested in here is whether the party could act as a primary 2 Law for Publicity of Assets of Individuals Assuming High State Public and other Duties in the Public and Private Sector.

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parentela venue. The answer is yes regardless of the CIEB–BCCI rivalry. The common denominator between the two episodes in the life of the NCTC consultations is that the party is the source of power that can disrupt the civil service consultative process and we can confidently state that it has the potential to lend its powers of administrative disruption through reforms to its party insider. In any case, the main point here is that eligibility rules or civil service reforms in general are the second way in which the party can interfere with the civil service, next to political appointments. With regards to the parentela, this clearly renders the party as a primary venue and indicative of parentela relations because it is an attractive venue for the parentela formation. Let us now turn to the rest of the policy network descriptors whose qualitative contents further align respondents’ description of the party-group relations with the parentela.

Degree of Access, Cooperation and Power Parity Expertise for Access In this section, we will review the rest of the parentela descriptors. The discussion centers around how groups could gain insider status within political parties. The discussion on the other parentela descriptors like cooperation and power parity is implicit, however. As already noted, qualitative data is multidimensional and could be ascribed to more than one category. At the same time, the reason why we will explicitly focus on the degree of access descriptor is simply because gaining insider status appears to be the most important topic among the respondents. The policy network literature is unanimous that it is policy expertise that facilitates the attainment of an insider status. This is evident in the policy networks we reviewed before, such as the iron triangles, policy community and clientela. So, is this the case with the parentela? The answer is that expertise is valued less. La Palombara (1964) does not mention technical policy-related knowledge as an asset to insiders. Greer (1994), too, leaves this question open. Instead, both authors seem to converge that voter support and campaign resources are the most important resources when it comes to seeking insider status within the ruling party. They also note ideological compatibility between the party and her prospective insider as something like an intervening variable. Things work better if both sides think alike, but they work best when the group

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provides electoral support. The BPS did not find any indication that ideology or technical expertise played any role. The account of Petrov indicates precisely that other groups and not those with expertise are valued the most when approaching the party policy venue. He recalled occasions where he was invited to informal meetings organized by political party C to discuss the state of the business environment in Bulgaria, and to formal consultations organized by the party A. In both cases, it appeared that respondent’s policy-proposals were given ample consideration. However, in agreement with Maloney et al. (1994) that access does not mean influence, Petrov’s proposals did not generally materialize into legislation. Few of them were adopted and those portions of the concurrent legislation, which stood as respondent’s earlier lobbying victories, were rolled back. In doing so, Petrov argued that other solo actors in fact had made more effective representation into the party and convinced it to return the previously unfavorable, status quo. The shared position among respondents was that expertise is irrelevant to political parties, or to the extent it is, it is still insufficient to provide a group with core insider status to the party venue. A strong indication for expertise being irrelevant to political parties is also the fact that consultations held by political parties with interest groups are sporadic and ad hoc. Respondents Hristov (party C) and Mitrev (party A) at a given stage in their response addressed the structures designed by their own respective party used to facilitate consultations with groups. However, respondent Lyubenov noted from his personal involvement in party-sponsored consultations that the level of technical engagement at such fora is extremely low to allow groups to be persuasive. Consultations with political parties do not appear to be geared toward establishing the technically correct policy decision. One has to speak in a different language to politicians, who are more interested in the general, macro points, a policy covers (Lyubenov). As Lyubenov also explains, political elites neither grasp the details of the policy options, nor, as Videnov argues, do party political elites trust technocrats in the civil service (in Petev 1998). Lyubenov also made the explicit point that in the course of his advisory sessions with political leaders of party C, the latter were unable to comprehend the details and technicalities of a given policy where civil servants would. As a result, he felt that most appropriate forum for his suggestions would be the civil service consultations.

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In a typical example of a party insider rendering administrative consultations nil, in Gospodinov’s view, the party and its insider resisted the amendments to the Law on Public Tenders that his TA promoted. It also transpired that the insiders in questions were also members of the TA he himself presided over. Similarly, Konstantinov was deliberately vague as to single out the splinter firms that had also benefited economically from a closer relationship with the ruling political parties. Konstantinov still pointed out that those insiders are firms with abnormal profits at times of an average economic downturn. Overall, these cases clearly discredit the view that expertise is the currency of access, let alone influence of political parties. Moreover, these episodes are also attributable to the long string of respondents alarming us that administrative consultations are often void because the party in power approaches them with a commitment to its insider. Finally, a more explicit and frank recognition came from Donchev, who argued that party-group cooperation is driven by common interests that do not rest on improving policies but onto maintain their collective long-term access to political power. Donchev complained from his relationship with the ruling party at the time. He strongly emphasized that meaningful technical consultations are largely limited to the civil service and that political parties are trying to subvert them by trying to impose the views of servile interest groups. While this was said with reference to the consultative process facilitated by the National Council on Tripartite Cooperation, this is stated here to advance another point. According to him political parties collude with a number of affluent participant and act against the interests of the wider civil society represented by interest- and advocacy groups, and Trade Associations. In what he argued to be an oligarchic policy-making model in Bulgaria, expertise did not feature in the party-group relationship. It was reserved for the civil service and those groups who catered to any insider status within political parties had to provide party-relevant resources, such as campaign funds. Voter Support and Ideological Proximity for Access Evidence from the Bulgarian case also suggests that ideology plays no significant part in the calculations of ruling parties whether to partner with prospective groups. Although ideological proximity or its more watered down variants, such as support to the party line, may

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theoretically act as catalysts to a shift to core insider status, precisely ideology seems irrelevant. There is virtually no data, both as direct statements in support of that proposition, nor indirect, i.e. implicit in respondents’ positions, that ideology factors in the calculations of ruling political parties whether to engage in a cooperative relationship with a given group. No respondents addressed the link between party access and ideological compatibility when discussing party-group relations. No evidence was found if whether groups shared the ideological goals is a matter of consideration to the party in power. Instead, a number of respondents emphasized on the absence of any ideological considerations in the policies of certain political parties and in appointing individuals of contrasting ideological background in their own government and civil service (Georgiev, Nikolov, Cenov and Bachvarov). This suggested that in their interactions with groups, too, ideology is irrelevant. Interviews gave ample space to respondents to discuss the party-group relationship, where should ideological proximity have been a factor that would have been aired. Respondent Nikolov on several occasions argued that it is the exchange of electoral resources that counts the most (also Golemanov, Gospodinov, Kuzmanov, Bachvarov, Mitrev and Valentinov). In that context, neither Nikolov nor others saw ideology to be of any significance. Although the passage below has a second interpretation, the main and more evident one is that cooperation is on the grounds of the exchange of campaign resources, i.e. campaign funds. Key names of individuals are deliberately letter coded (// denote respondent’s action while speaking). It also needs clarifying that the quotation below refers to the circles, which in Bulgarian policy-making context stand for companies, oligarchs and firms that may act in concert informally to protect their interests in a close cooperation with the ruling party. But let us turn to Nikolov’s interview3: S: And, that circle around [old party leader L], it was the so called Z, right? R: Yes, /pause/

3 Quotation nomenclature: [ ]—author’s inserts; / /—author’s description of respondent’s action; ( )—clarification by author; R—respondent, S—reSearcher; I—intermediary; A, B, C … —concealed names of policy-making actors.

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I: /inaudible/ with them now? R: Well, they went elsewhere, I want to tell you, that they from [that circle], only one is left, that one – S: V? R: V is left. But V bends over to absolutely everyone, I want to tell you. V is in very good relationship with [the leader of party C]. S: Huh? R: How else! /confidently/. S: But that he worked for [L] in the past – did not that get in the way of V’s cooperation with [the leader of party C]? R: Why should that be a problem at all? He is just now working for [C]!? I: [party Leader of C] obviously does not mind, either! /laughing/ R: But why would [having cooperated with a different political party in the past] be of any consequence, when a bagful of money is emptied in front of [C]? And that is several times? /rhetorically/.

In the exchange above the assumption of the researcher when approaching the topic was that each political party would prefer to cooperate with ideologically similar groups or individuals. The excerpt however exemplifies that former party allegiance is irrelevant in the calculations whether to establish a relationship with a new group. In the quotation, the businessman V found no difficulty in cooperating with two different ruling parties. While in this case, the two parties in question were ideologically similar, it is hard to say that ideological proximity has played any role, because the fluidity of such party–group relations makes it implausible that ideology would provide such a strong bond. Respondent Nikolov cited another case where the oligarch, Mr. W, had contributed a significant sum to the political campaign of party A in exchange of adopting his nominee as Prime Minister H. It was an interesting fact that before their appointment as a prime minister, H had established their political career working for the ideologically opposite party L. At the same interview with Nikolov, the intermediary, an active functionary for party A, gave another example of a high-ranking individual within party A, who also assumed a high post in spite of a contrasting ideological past. The implicit suggestion made by the intermediary was that those party functionaries with a political past with the exact opposite parties on the ideological spectrum were the result of cooperation between party A and oligarchic party donors, who gain access with any political party in power. Intermediary’s other implicit suggestion was that party appointees resting on ideological astroturf were also representatives

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of the oligarchic circle that funded A’s rivals in the past, then A itself. Nikolov agreed to both. The case of this particular appointment of H by party A emerged again, at the interview with Respondent Penchev who in the past was a member of the same party with H. He generously explained his life story and involvement in the policy-making process in Bulgaria, as an active member of party B’s executive bureau. At the end of the interview he showed the researcher a handwritten list of names of nominees for premier sent to party A. He confided he was personally involved in the selection process and recounted their personal telephone calls with the closest aides to leader of party A. Finally, he claimed that he personally advocated the appointment of H as a prime minister, but did not elaborate on any possible involvement of oligarch W. At the time of that interview, the link between W and H had not been established. However, it is possible to connect Penchev, H and W as they share the same ideological inclinations and also because they are united in their association with former party leader L, whose party stands on the exact opposite ideological spectrum to A. Cenov and respective intermediary (below) argued that H owed the start of his political career to L when L had been in power. Likewise, W owed his initial affluence to L’s tenure, as well. Penchev in fact boasted personally to the researcher of his close friendship to the leader of party L, dating from before H’s tenure as a prime minister, as well. However, most importantly, the above indicates that party A’s engagement with W and endorsement of H were devoid of any ideological considerations because A conceded to an appointment of an individual from an opposite ideological background under the influence of the oligarch W. In the same vein, respondents Aleksandrov and Georgiev also identified the same ideological departure of party A from its true ideological riverbed. Both respondents extensively and avidly condemned the cooperation between party A and an oligarch X, resulting in the latter’s monopolistic position on the market. In doing so both respondents independently criticized party A’s cooperation with actors who solely focused on own self-interests. Party leaders of minor coalition partners of A (Valentinov and Mitrev) voiced similar concern regarding that A’s cooperation with economic actors is devoid of any consideration of any ideological compatibility, even if we bring the term down to its lowest common denominator, to mean ‘common good’. Not only was the party devoid of ideological consideration as a guidance determining which

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groups to cooperate with but it was also devoid of any moral compass such as the common good which would help determine partner suitability of aspiring insider groups. Campaign Funds for Access The sections so far demonstrated that neither expertise, nor group’s ideological proximity have an effect on a group’s core insider status to ruling political parties. Data from the Bulgarian case indicates that it is possible for groups to establish core insider status within the ruling party with the provision of campaign funds. That was first exemplified by Petrov, who was fed empty promises at party A’s consultations, only to maintain his support until after elections when respondent’s proposals were watered down by political expediency and according to him in the interest of competing groups. At both seemingly consultative meetings he participated in with party A and C, the consultations lacked much substance. Respondents Petrov and Konstantinov also implied that affluent actors had gained much better access to the respective political party, although both were also reluctant to speak with names. Respondents are unanimous that the high costs of electoral campaigns put political parties at great dependency on campaign funds, which has become the main currency of core insider access to political parties. Although in order to combat the overdependence of political parties on campaign funds each political party is given a state subsidy for the electoral campaigns, respondents who campaigned either for mayoral or MP positions in the past report that actual cost of elections is several times higher than what is declared for reimbursement. A number of respondents from political and business background argued that the cost of political campaigns forces political parties to seek out any reasonably affluent business actors who can contribute (Golemanov, Bachvarov, Petkov and Kuzmanov). Many used the terms oligarchs, grupirovki or circle s to identify the private actors that parties cooperated with in order to receive the rest of the necessary funds for carrying out the campaigns. In the words of Georgiev: ‘do ut des’ or give in order to receive. Groups tend to use campaign funds as the currency of core insider status. However, as already mentioned earlier, and while they may seek favorable appointments in exchange, it seems the prime good they seek in return is privileged access to public tenders. In the words of

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Gospodinov, at the one end of the bargain we have groups who possess campaign funds to cover the actual costs of the campaigns: In Bulgaria there is an absolute merger between the party and business, between party and money, absolutely, because parties cannot function without money, and money is obtained through business and this process is not regulated. There are laws, that specify how much it could be spent [on elections] […] Yes, but I know what the real costs are, say, for TV commercials and the sums parties declare are insulting (under-reported, sic) and ridiculous. And they declare such sums because it is on the basis of such sums that they account to the State Auditor (agency, sic) and this is how much the law permits them. But the money they spend is 2, 3, 4 times higher. […] I have an immediate experience in this respect because I have taken part in many campaigns.

Also speaking from personal experience in politics and political campaigns, Respondent Petkov explains the same: […] We have a mutual interconnectedness between services of the state of the past, the present, and the grupirovki, which are those [actors] who make it possible for a political party to come to power. This happens in two ways. First, through the financing of a political party. It is known that elections cost a lot, [or rather] increasingly cost more. Of course, I do not have statistics with me, but a political party which wants to leap over the 4% barrier, if it does not have 10 million (leva), should not even attempt going to elections. And this is not a question of buying voters; it is a question of [expenses on] one serious and structured organisational work. […] It is very naïve to believe that the members of a given party collect enough money for electoral campaigns. This could not happen because Bulgarian citizens are too poor. […] the grupirovki have [that resource] as well as the interconnected structures with them [intelligence community], […] so grupirovki are of importance and they are of importance for the party infrastructural organisation, financing and resourcing, so that the party can approach elections adequately.

In the same vein, Respondent Golemanov states: So, say you are some party; you have a state subsidy of 2.5 million leva for presidential campaigns. But you cannot do anything with those 2 million leva! Because one interview or debate on national TV costs you 200 to 300 thousand leva! Well, the minute there is between 1.5 to 2 thousand leva!

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That’s scary! You, without you having this economic circle behind your back, the one we are talking about right now, [you cannot make it because] it actually costs you 6 million leva. After that you declare them to the State Auditor. [As for the firm sponsoring you] half of that money is accounted as New Year’s calendars for 1.2 million leva, while in reality these are placards with your muzzle on them! But it is not you who pays for that!

In other words, the actual costs above that political parties declare to the authorities are covered by the party donors directly. No campaign funds, in excess to what the party receives as subsidies, is actually received by the party. To substantiate his point, Golemanov provided an example with their own mayoral political campaign: When I decided to become a mayor […] I went from one firm to another, [and] to those [people] with whom I was on good terms. […] They would say, “Listen, 3 thousand leva, we can give to you!” […] and I bought placards with that, but they did not give the money straight to me! I do not take any money!

By making this analogy, Golemanov argued that political parties need not necessarily possess the campaign funds. Those could be spent on their behalf by their sponsors. The question of actual expenses on political campaigns is intriguing but requires an independent study on its own. Identifying such a discrepancy would require much deeper access to party functionaries and accounting documentation that is not in the public purview. Still, some of the more prominent NGOs, such as Transparency International, who monitor elections, seem to confirm respondents’ concerns. In a recent report, the Hristova-Valtcheva and Toneva-Metodieva (2014: 16–17) argue that there are mechanisms in place to reimburse parties passing a 1% threshold at parliamentary elections, however, Bulgarian parties still do not fully disclose the sources of their funding. With an index scale from 1, lowest, to 10, highest degree of party donor financing, Bulgaria remains at about 4 (2013 Parliamentary Elections), which still means high, and very much likely, deliberate concealment of financing sources. This is clearly indicative of the fact that Bulgarian political parties could be expending more than what they declare to the authorities. Both the report and the results from this subsection, therefore, complement each other.

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Conclusion The main points to take out from this chapter are that the 26 elite interviews on the part-group relations confirm the outlines of the parentela. The interviews revealed that groups can gain insider status to political parties if they are able to provide the much needed campaign funds. This is similar to the other two parentela cases in Northern Ireland (Greer 1994) and Italy (La Palombara 1964), where party insider status was granted because the groups offered political parties the votes of their rank and file. The Bulgarian case reveals the importance of a third kind of resource that allows the group to gain core party insider status: campaign funds. Furthermore, the study so far shows that Bulgarian parties can act as primary parentela venues, because they can control the civil service through appointments and administrative reforms, although the latter is an instrument that warrants further research. In any case, political parties enter cooperative relationship with those groups that can provide campaign funds. The discussion on party access, however, should also be read as relevant to the other two parentela descriptors: cooperation and power parity. The description of the interaction between parties and prospective party insider can clearly be read as evidence of a balanced and cooperative relationship between the two. Neither tension nor attempts at overpowering can be detected in the respondents on the relations between the party and prospective insiders. Finally, as it was already indicated, a better way to demonstrate the original parentela is by presenting a case of it in action, which will be done in the next chapter. The last thing we need to do before going any further is to remember that both parentela dynamics (or types) will be combined together in a single model of oligarchic dynamics in Chapter 5.

References BCCI (Bulgarian Chamber of Commerce and Industry). (2011a, December 16). BCCI Press Release. Retrieved from http://www.bcci.bg/news/2613. BCCI (Bulgarian Chamber of Commerce and Industry). (2011b, December 15). Parliamentary Debates Transcripts, #236. Retrieved from http://www.bcci. bg/bulgarian/parliament/236.doc.

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BCCI (Bulgarian Chamber of Commerce and Industry). (2011c, December 15). Parliamentary Debates Transcripts, #237. Retrieved from http://www.bcci. bg/bulgarian/parliament/237.doc. BCCI (Bulgarian Chamber of Commerce and Industry). (2011d, December 15). Parliamentary Debates Transcripts, #238. Retrieved from http://www.bcci. bg/bulgarian/parliament/238.doc. Bozhidarova, V., Kolcheva, V. & Velinova, R. (2002). Politico-Administrative Relations in Bulgaria at Central Government Level. UN Panel. link: http://unpan1.un.org/intradoc/groups/public/documents/nispacee/ unpan005794.pdf, last accessed 29.09.2018. Bulgarian Council of Ministers of Bulgaria. (2014) We Are Working for the People: Strategy for Development of the State Administration [Paбoтим зa xopaтa: Cтpaтeгия зa paзвитиe нa дъpжaвнaтa aдминиcтpaция]. Retrieved from http://www.strategy.bg/PublicConsultations/View.aspx?lang=bg-BG&Id= 1152. Chalakov, I., Bundzhulov, A., Hristov, I., Deyanova, L., Nikolova, N., Deyanov, D., et al. (2008). The Networks of Transition—What Actually Happened in Bulgaria After 1989? Sofia: East-West [Чaлъкoв, Ив., Бyнджyлoв, A., Xpиcтoв, И., Дeянoвa, Л., Hикoлoвa, H., Дeянoв, Д., Mитeв, T., Cлaвeнкoв, Б., Cимeoнoв, O., Чипeв, П., Cтoйнeв, B., Фeлиcи, Cт. (2008). Mpeжитe нa пpexoдa – Кaквo ce cлyчи вcъщнocт в Бългapия cлeд 1989. Coфия: Изтoк-Зaпaд]. CIEB (Chamber of Industrialists and Employers in Bulgaria). (2013, February 4). Declaration from the Representatives Organizations on a State Level for Their Discontinuation of Participation in NCTC (National Council for Tripartite Cooperation) [ДEКЛAPAЦИЯ OT ПPEДCTABИTEЛHИTE OPГAHИЗAЦИИ HA PAБOTOДATEЛИTE HA HAЦИOHAЛHO PABHИЩE ЗA ПPEКPATЯBAHE УЧACTИETO ИM B HCTC]. KRIB. Retrieved from http://krib.bg/bg/positions/ Deklaracia-ot-predstavitelnite-organizavcii-na-rabotodatelite/. Council of Ministers Accepted a Strategy for the Development of the Civil Service [Mиниcтepcки Cъвeт пpиe Cтpaтeгия зa Paзвитиe нa Aдминиcтpaциятa]. (2014, March 5). BGNES. Retrieved from http://www.vesti.bg/bulgaria/ politika/ms-prie-strategiia-za-razvitie-na-administraciiata-6006775. Dimitrova, A. (2002). Enlargement, Institution-Building and the EU’s Administrative Capacity Requirement. West European Politics, 25(4), 171– 190. https://doi.org/10.1080/713601647. Greer, A. (1994). Policy Networks and State-Farmer Relations in Northern Ireland, 1921–72. Political Studies, 42(3), 396–412. Hristova-Valtcheva, K., & Toneva-Metodieva, L. (2014). Lobbying in Bulgaria: Interests, Influence, Politics. Sofia: Transparency International.

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Kopecky, P., & Spirova, M. (2011). Job for the Boys? Patterns of Party Patronage in Post-Communist Europe. West European Politics, 34(5), 897–921. La Palombara, J. (1964). Interest Groups in Italian Politics. Princeton: Princeton University Press. Law on the Administration [Зaкoн зa Aдминиcтpaциятa]. (1998). (Last amended with State Gazette issue 27 of 25.03.2014). Retrieved from http://www.lex. bg/bg/laws/ldoc/2134443520. Maloney, W. A, Jordan, G. & McLaughlin, A. (1994). Interest Groups and Public Policy: The Insider/Outsider Model Revisited. Journal of Public Policy, 14(1), 17–38. Petev, N. (1998). Beyond the Political Theater Through the View of Zhan Videnov [Oтвъд пoлитичecкия тeaтъp пpeз пoглeдa нa Жaн Bидeнoв]. Sofia: Hristo Botev. Raychev, A., & Stoychev, S. (2008). What Happened? A Narrative About the Transition in Bulgaria and a Bit Thereafter. Sofia: Trud [Paйчeв, A., & Cтoйчeв, К. (2008). Кaквo ce cлyчи? Paзкaз зa пpexoдa в Бългapия и мaлкo cлeд нeгo 1989–2004. Coфия: Tpyд]. Richardson, J., & Jordan, A. G. (1979). Governing Under Pressure: The Policy Process in a Post-parliamentary Democracy. Oxford: Martin Robertson & Co. Shoylekova, M. (2004). Building Capacity for Policy Making: Experience from the Bulgarian Administrative Reforms. Paper prepared for presentation in Working group 3: Strategic Leadership in Central Government, at 12th NISPAcee Annual Conference, Vilnius, Lithuania, May 13–15. Spirova, M. (2012). ‘A Tradition We Don’t Mess with’ Party Patronage in Bulgaria. In P. Kopecky, P. Mair, & M. Spirova (Eds.), Party Patronage and Party Government in European Democracies. Oxford: Oxford University Press.

CHAPTER 3

La Palombara’s Parentela in Bulgaria: The Case of Public Procurement Contracts (Public Tenders)

As noted in the Chapter 2, more convincing method to demonstrate the parentela would be if we could observe it in operation as a complete system. Following the research plan to identify cases of the parentela in the course of fieldwork, the study successfully identified a policy area where one could observe the parentela: the award of public procurement contracts in the construction sector. The case is based on the observation made by the respondents and in a report commissioned by the Bulgarian construction sector (VUARR 2014) that as of 2014– 2015 some construction firms appear to dominate the public tender auctions. In more detail, the case argues that this parentela formation is the result of the combination of two intersecting independent variables: construction firms trying to survive in a market in decline and at the same time political parties trying to find campaign funding. On a more general level, the argument is that the parentela in the Bulgarian case is the result of a common desire by political and private actors to monetize, i.e. convert, political access into capital. For political parties, conversion is providing access to an insider group against campaign funds. For the party insider, conversion means to improve its market competitiveness by exploiting its good relations with the ruling party. In the specific case which we will discuss here, improved competitiveness means dominating over the distribution of public construction project procurement bids. As we will see later, another form of conversion is the exploitation of the regulatory agencies, or type two parentela, where one’s market © The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3_3

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competition is cleared using prejudiced regulatory inspections, facilitated by party political patronage in the civil service. The chapter is structured as follows: In the first section, we will introduce the subject of public tenders, the Law on Public Tenders (2004) and how its provisions enable the formation of type one parentela dynamics. The second section will focus on the evidence of party interference in the process of public tenders, which essentially is network’s manifestation. Only one aspect of the parentela relationship will deliberately be left for the next chapter: the relationship between the insider and the party. Again, because qualitative data is such that it can be attributed to two categories simultaneously, we will discuss the evidence that political parties influence the allocation of public tenders in the interest of their insiders in the next chapter.

The Law on Public Tenders 2004 and the Parentela The Law on Public Tenders (LPT) was first introduced in 2004. It regulates the provision of goods and services to the public by private firms. In many cases, these are large construction projects, such as highways, dams, bridges, etc., the completion of which is carried out in the shape of a contract, known as public tender or procurement contract between the state (i.e. employer or essentially the civil service) and a private firm (contractor). According to LPT 2004, the civil service (the employer)1 has to organize an auction where prospective contractors would compete against each other (bid) which of them would make the most agreeable offer to the employer. Before an auction is convened, however, the employer specifies a list of criteria for eligibility of participation and the criteria according to which offers will be considered. For example, some of the criteria that the offers might have to meet are appropriate price range for project’s execution, years of experience in providing the service, project’s duration and everything else that the employer deems important. The present case on construction tenders began with the observation that most if not all respondents used public tenders to exemplify political malpractice between ruling parties and private companies, particularly in the construction sector. In fact, was also articulated in a 1 According to article 7 from LPT, an employer of public tenders is essentially the civil service, such as ministries, agencies, local level administration.

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report commissioned by the sectoral peak association of the Chamber of Bulgarian Constructors (KSB) and later carried out by the Higher School for Agri-Business and Regional Development (VUARR). The VUARR report is representative of the construction sector in Bulgaria, with about 350 surveys featuring open and close-ended questions (VUARR 2014: 5–11). The study was carried out in the form of a survey among the construction firms in the Bulgarian construction sector in 2014. Based on the personal experiences of the respondents, the VUARR (2014: 76–104) report argues that the prime (if not the only) source of manipulation of the public tenders lies with public bodies that skew the criteria for participation so to narrow the competitors down to the intended ones. The sectoral study reveals that construction company owners complained mostly from the fact that advertised public tenders require such characteristics from the prospective contractors that can only befit only those with connections with political parties. Accordingly, a dominant observation of construction firm owners was that firms with direct party access tend to dominate the market for construction tenders (VUARR 2014). The second (37.5%) most important difficulty that Bulgarian construction firms faced was corruption and disloyal competition, i.e. the firms that won public tenders thanks to party political interference in their favor (2014: 16–17, original emphasis): The fact that the larger category investors are not private […] places the larger sector before the larger problem of corruption, the dictation of foreign and/or those firms having political protection and investors, as well as disloyal competition. This is the position of more than one third of those participated in the questionnaire. Part of the construct[ion firms] and experts describe classical cases of eventual competition elimination with “specific” criteria, which decrease the possible competitors to a few. […]

The report in other words states that a dominant position among construction firm owners is that political parties interfere in favor of party insider groups to the effect that the latter become disproportionate construction tender winners. This is labeled above as corruption and ‘those firms having political protection’ (VUARR 2014: 16). Toward the end, the quotation above also indicates that the most often used mechanism for tacit preselection (of party insider groups) is the careful wording of the eligibility criteria for procurement auction participation.

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The VUARR report is not alone in highlighting that contractors can win public tenders by making the eligibility criteria fit the desired firm. This point is also discussed in the second version of the Motives supporting the October 2014 amendments to the Law of Public Tenders 2004 (reference number 302-01-14). Such “Motives” are compulsory legal text that discusses, comments and explains in plain form the reasoning behind any new or amended legislation. Interestingly, there were two such versions of the Motives behind LPT October 2014 amendments: first one issued on 26.07.2013, and a second version as of 28.08.2013. Of interest here is the latter one. It stated that the proposed amendments intended to address the two difficulties associated with the conduct of public tender auctions, which had been outlined in a much earlier decision of the Bulgarian Commission for the Protection of Competition (CPC) 570/20.05.2010: public and private forms of public auction manipulation. The CPC Decision 570/20.05.2010 classifies public tender manipulation in two categories: public (employer) and private (contractor) (CPC570/20.05.2010: paragraph 9). Out of the two, the present discussion is interested in the former because according to the CPC employer-related forms of public tender manipulation could serve as a mechanism to pre-select party insiders. Paragraph 10 (CPC570/20.05.2010) states that the free competition of offers submitted by prospective contractors can be inhibited by actions, inactions and legal acts that are within the legal purview of the employer, which in the LPT case is the civil service or more specifically the Public Tender Committees (PTCs) (discussed below). Furthermore, Paragraph 11 (CPC570/20.05.2010) directly describes how employers can predetermine or ensure the grant of tenders to desired firms (or to party insiders as this chapter argues) (emphasis added): The public form of tender competition circumscription could be realised by the employers themselves through the introduction of discriminatory conditions and requirements on the participants at the start of public tender assignation procedure, which narrows the circle of potential contractors, creates unjustified access barriers to candidates or favouritises in advance a specific market participant. The violation of the principle of free and loyal competition is possible when some applicants are unlawfully decreed permission to enter the auction and their offers considered when in fact they should have been disqualified.

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In other words, the criteria of eligibility to participate in a tender can be worded and devised in a way so as to render any non-desirable competitors ineligible to compete at the auction. As it will be demonstrated below, respondents from the BPS and VUARR studies report a ubiquity of this practice in the 2010s. The importance of this CPC decision and its Motivation is that they further justified looking into public tenders as an area that harbors the dynamics of La Palombara’s parentela. The definition of the public form of auction manipulation clearly overlaps with the logic of the parentela, where the ruling party intervenes in the work of the civil service in order to benefit its party insider group. True, in the context of public tenders we are not dealing with formal interest groups or policy-making, but none of this violates the parentela dynamic. We are still dealing with a party insider who is capable to indirectly influence the decisions of the civil service by having the party interfere on its behalf using political appointments, as we shall later in this chapter. Some theoretical examples of public forms of auction (bid) manipulation could be found in another, adjoining, paper produced by the CPC, which is to be read in conjunction with decision 570/20.05.2010.2 Titled List of Circumstances whose Presence Allows for Suspicions of Auction Manipulations (CPC 2010) this addendum to decision 570/20.05.2010 is a reference summary and a checklist of suspicious circumstances at procurement auctions which might indicate public or private forms of bid manipulation. It was mentioned that a public form of manipulation is when there are tacit agreements between the employer and the winning bidder. A private form of auction manipulation, then, is when competing wannabe contractors form a cartel and agree in advance on which of them will submit the winning offer. Unfortunately, that document does not explicitly specify which of the listed circumstances relate to which categories, although there are scenarios in the list that would clearly ascribe to public forms of bid manipulation. The first situation that arises suspicion of possible arrangements between the contractor and employer is when, ‘1. […] an offer is submitted by a candidate who is publicly known to be unable to execute 2 The CPC 570 decision is titled СПИСЪК НА ОБСТОЯТЕЛСТВА НАЛИЧИЕТО НА КОИТО ОБУСЛАВЯ СЪМНЕНИЕ ЗА ТРЪЖНИ МАНИПУЛАЦИИ and accompanied by the file CPC Check list Bid-rigging final.doc, md5 2c3399221024edccd69017ceca198577, which lists the scenarios that are indicative of public tender malpractice.

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the tender […]’. We believe this to be true as unbeknownst of this point both respondents Rumenov and Dobromirov mentioned in their experience in construction tenders cases where firms with no such experience won lucrative tenders for road constructions. Another indicator for employer-based manipulation relates to cases where candidates do not include the necessary technical specification for project’s execution, but boldly participate: 3. One or a few of the enterprises who have submitted offers, have not required from the employer the technical specifications on the object of the tender or their offers lack such data that would normally follows to be included […]

At first sight, this scenario seems more befitting a case where private participants have agreed in advance on who would submit the winning bid (i.e. formed a cartel) and so, all save for the agreed participant submit technically flawed offers. However, this could also be read as a form public form of bid manipulation, if a firm lacking such technical specifications, or offering inferior ones is selected as the main contractor. This is analogous situation to the earlier point above. However, point 30 of the checklist directly speaks of the public auction manipulation type, when certain firms become the predominant contractor in a given area or the provision of certain goods/services despite evidence of potent competition: 30. Said participants regularly win the procedures for the assignation of a specific type and volume of public tenders, or procedures opened by specific employers, or in specific geographical regions often win the same participants from the market, although there is evidence of real and potential competition.

In other words, suspicions of party-intervention in the allocation of public tenders arise whenever—despite evident competition—a certain contractor dominates the tenders in a given region, or when they dominate the provision of a certain good/service under near-identical specifications; or, finally, when a certain contractor dominates the public tenders coming from a certain employer. Ultimately, the results of the VUARR study are a clear testament of the unimpeded practice of public tender manipulation as specified in

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paragraph 11 of the CPC decision CPC570/20.05.2010 above and the points from the Motives. The responses are too voluminous for extended discussion but the few quotations here are enough to illustrate the considerable breadth of party interference in public tenders: Sometimes it happens so that the conditions are so specific to one firm that the only thing missing in the [selection] criteria is its name. (VUARR 2014: 104) The construction sector is hostage to politicians. (VUARR 2014: 77) Real market competition is pushed aside by the fight for maximal proximity to party political tenders. (VUARR 2014: 104) The created proximity between politics and the construction sector limits free competition. (VUARR 2014: 104) There is an accelerated liquidation of small construction firms through LPT and more specifically the introduced criterion of “economically most suitable offer [i.e.] technical offer”. The options are: remaining of a small number of big firms that dictate on the market. Which ones would they be depends not on their technological and technical or cadre capabilities, but on whether their owner is in close relations with the ruling political party. (VUARR 2014: 101)

Again, these are excerpts from the interviews conducted with the VUARR respondents. Their importance lies not only in serving as evidence of parentela relations but that the scope of the practice might be under-reported, because the authors of the report might have engaged in some form of self-censorship. The suspicion arises when one reviews the included interview excerpts at the end, which almost all complain from party-sponsored manipulation of public tenders. In any case and in unison with the VUARR (2014) respondents, those from BPS were overwhelming in their identification of political parties as the source of public tenders malformation. There is no deviation from the VUARR view that political parties attempt to preselect party insiders at public tenders in order to reciprocate for latter’s earlier campaign contributions. A considerable number of BPS respondents argued ruling parties are in the position to control the decisions of the Public Tender Committees (PTCs) whose task is to convene and carry out the procurement bids. We will discuss PTCs below. The difference was in the nuances of the argument. Two active policy-makers at the

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time of interview, respondent Hadzhiev and Gospodinov, explained that insiders expect public tenders or appointments in the state administration in return for their campaign resources provided to the ruling party. The idea that public tenders are exchanged for public tenders access is at the heart of Gospodinov’s position: R: So, we start from [the inability of parties to meet the actual campaign costs] and we finish with the sources. Sources [of financing] are clear: the business [for parties], the big Public Tenders [for business]. We [on behalf of industrial sector] are trying to win Public Tenders. At present this is the only source of income for business. When there were big foreign investors in the recent past, there was no such high level of pressure, but now, things are serious. So, parties, coming to power, there is nothing for free. Once you have taken the money, you have to give it back. And this is done through state power (government, sic).

Respondent Bachvarov directly admitted that party political donors approach parties with the intention to exchange that for public tenders and appointments: R: So, the business groups in Bulgaria take part in the entire chain of conduct of politics in this state. From one angle, business participates as early as possible in the formation of the branches of power, which is at the electoral campaign, through sponsorship of various political powers, and in another way – in the formation of the future government. Very often specific ministerial and high positioned civil servants are appointed under the influence of business structures. And third, they (business, sic) participate in the process of real politics, which is primarily through the distribution of public tenders, where every business structure attempts to tear as big a share (contract, sic) as they can for themselves.

As the respondent elaborated further, business groups see campaigns as a form of investment. If the party becomes incumbent, then the group should expect public tender in return. Respondent Gospodinov, spoke in the same vein with particular reference to the entire construction sector: R: Our aim is to try and decrease subjectivism (i.e. administrative preselection of intended tender winner, sic) to minimum. We tried in

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various ways. One was through the direct introduction of the German legislation [… or] with very simple things, such as everything to be uploaded online on the day of opening of the offers. However, we were met with stark resistance, because there is a manipulation between the process of announcing the criteria and the process of the opening of the offers. So, the process of opening of the technical criteria [for the job] lasts until the offers are opened. There is a gap of 2 to 3 weeks between these two processes, when manipulation could be done, such as cross-checking the prices in the offers. S: You mentioned some resistance… R: The resistance comes from the administration which does not want to make the procedures public– S: Why? R: /laughs/because for the reasons I have just told you. So that the ability to manipulate the end result remains. This is done through transparent envelopes and all other ways, nearly criminal. I am telling you like this but there are colleagues claim for such cases. S: It is curious for me, how is it that the administration is doing that on own initiative or under influence from elsewhere R: Well, here things are intertwined. The administration says that the European rules allow it, which is a manipulation and a lie. Here is the connectedness between the administration and the people who rule at the moment and the entire politics is towards directing [the outcome of] public tenders. Overall, the general solution to this problem is transparency, internet transparency and every step of the process be announced publicly. There is no single impediment for that to be achieved. […] but it is not happening […] they are voted in the committees but do not enter into effect.

The lack of progress in the Public Tender legislation at the time of the field-work was explained with the subordination of the civil servants to the political party in power, which refuses to commit to more transparency in the process. Gospodinov’s response also implies that such resistance could be indicative of protecting the interests of party insiders. After all, it takes two to tango when it comes to the public form of public tender manipulation. Respondents Donchev, Kirilov, Bachvarov, Gospodinov, Zlatarov, Rumenov, Dobromirov, Varbanov and Petrov spoke with particular reference to public tenders in relation to insider groups securing insider access as a result of an exchange with ruling political parties. The more important statement is from Donchev who argued that the law is

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deliberately imprecise so as to allow party insiders and the party itself to be able to tilt the outcome of public tenders in their favor. This is also another confirmation of the argument that the core weakness of the October 2014 amendments is the continued facilitation of party interference. Speaking as a director of a peak construction association prior 01.10.2014, Gospodinov stated that LPT’s imperfections allowed for party-appointed experts to take part in PTCs decisions. He was not invited to elaborate because the significance of this statement was not immediately evident to the researcher at the time of the interview. However, documentary evidence later on further supported his claim on the significance of PTCs and how they fitted the overall mechanics of public tender manipulation. The purpose of this section has been to exemplify the point that public tender manipulation could serve as a case of La Palombara’s parentela, and more generally, that public tenders are a contested ground whose dynamics follows the logic of the parentela. The provided examples above are simply a variation of the parentela theme where an informal party insider group, which does not represent the interests of a social or economic sector, benefits from that party’s interference in the work of the civil service, and as a result of which is awarded state procurement contracts. These statements, however, although coming from an authoritative source, still leave a missing link in the chain. Essentially, what is the mechanism, steps or process that unites the party, civil service and the party-privileged public tender winner? So far we read the statements that party insiders win public tenders. If that is so, how? The only hint we were given above was that molding the criteria for auction participation to match the profile of the desired participant ensures that the winning firm will be the intended firm. The actual answer is in the party political control of the so-called PTC. These are the administrative bodies that convene and decide on public tender auctions. As Gospodinov hinted the control of the PTCs through political appointments enables the ruling party to predetermine the outcome of a PTC’s ruling. This is discussed in the next section.

Party Interference in Public Tenders The study found that political parties could preselect party insider firms at public tender auctions by shaping the membership of the administrative body that decides on the winning tenders: the Public Tender Committees.

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These committees are specified in art 34(1) from the LPT (writing with reference to the October 2014 amendments) and they are established by the state employer, i.e. the civil service. The members of the PTCs have to administer the auction of public tenders: from the formal announcement of the prospective auction to the final selection of the winning bid, and the maintenance of necessary legal or administrative communication with third bodies, such as trade associations, EU institutions, and ministries. The controversy around the PTCs is about who will sit as their member, because its members define the criteria for participation and assessment of the offers made by prospective constructors. As we shall see the parentela forms when the PTCs are predominantly staffed with party political appointees. While the October 2014 amendments provide for nonpolitical experts to sit at such committees, the legal provisions are in fact permissive of the continued political appointments. The crux of the matter is that although PTCs are allowed to recruit their expert members from respective trade associations, there is no obligation on the administrative unit director who will act as the employer to do so. They have the discretion to decide whether they have the experts to appoint in the PTC in-house and whether they need to attract someone from outside their administrative unit. In light of the extent of party patronage in Bulgaria, one could imagine that high-ranking servants will always find the experts they need from among their subordinates. This brings us to the next point. There is no criteria according to which a director can decide whether the in-house servants can act as PTC expert members. Obviously, in the absence of any specific criteria defining who can qualify as an expert, any one subordinate servant can be an expert in the eyes of an agency chief. Thus, following the long chain of appointments starting from the ministers downwards, the party controls who sits at the PTCs. In turn, staffing a PTC with political appointees allows insider preselection through a careful definition of the participation criteria to fit the profile of the party insider participant, i.e. public form of tender manipulation described above. All of this ultimately corroborates the VUARR 2014 report which posited that a major impediment to the public tender auctions execution is the party interference in favor of certain firms. The present section explains how this is done. A recent report by Bulgaria’s intelligence agency DANS, presented by Mr. Kalin Krastev concerning oblast3 Shumen states that the 3 Oblast

is the largest regional unit, which consists of smaller units called obshtina (sg; -ni, pl.).

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careful selection of the members of the PTC facilitates the tacit contractor preselection. In his summary to the public (Shumenska Zarya (40/12420)/27.02.2015: 2) he confirms that the main mechanism of preselecting an intended contractor is through the malformation of the participation eligibility criteria and the criteria for assessing offers’ feasibility. However, he also notes that this is in turn is only the result of political parties influencing the work of the PTC. In his words (emphasis added): Interconnectedness exists between the employer, contractor and sub-contractors where in many cases; the servants on a governmental post exert influence on the selection of specific constructor or consortium. […] A defining factor is that the committees are convened by servants of the respective administration which are directly subordinate to and find themselves in hierarchical dependence on persons holding governmental posts.

The DANS report then corroborates the industry-wide observation made in the VUARR and among the parentela study respondents that political parties interfere in the market for construction work in the interest of party insiders. The intelligence report confirms that this is possible since those who preside over PTC decision are subservient to the (local or central) political party. Once appointed as PTC members, the party subordinates produce such procurement contract prerequisites and specifications that can only be matched by the intended contractor. But how, then, is it possible for political parties to shape the PTC membership? In his written statement on the LPT 302-01-14 amendments, Docent Doctor Gancho Popov (reference 167/27.09.2013) argues that ultimately the party is still in the position to predetermine the outcome of PTC decisions. Popov’s critique is that facilitated by a chain of political appointments, the absence of obligation on employers to use experts from the list of external experts (nominated by trade associations) in the PTC allows the administration to continue to use civil servants, who are political appointees, to prepare public tender procedures and who in turn will design the offer feasibility and contractor eligibility criteria in a way that will fit the profile of the party insider firm (section 8.3) (Popov 2013: 1–3). Another factor that enables the use of politically appointed civil servants is that LPT does not specify the criteria that

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determines who is qualified as an expert to sit at the PTC. Therefore, state-appointed experts become an extension of the party in power. This is entirely consistent with former minister Petkov’s position earlier that any individual, regardless of how much they advertise themselves as non-political experts is never free from the party that has appointed them. Popov argues therefore that politically appointed civil servants will always seek ways to recruit experts from the subordinate rank and file of the state administration, when public tenders have to be organized. This is facilitated by the absence of any provisions in the LPT, which enforce objective criteria for any expert appointments. As it stands, experts sponsored by the civil service are left to the discretion of civil service directors to determine their expert status (2013: 2). Popov rests his critique on the interplay of articles 8(7) and 20(1) of the LPT October 2014 amendments, although for completeness, one also has to add the importance of articles 34, 19(2)8, 20(1) from LPT and 19(1–4) from Law on Administration. Article 19(1) from LPT clearly states that the director of the agency that regulates public tenders is a political appointee: ‘the Agency on Public Tenders (APT) is directed and represented by an executive director, who is appointed by the Minister of the Economy, Energy and Tourism.’ This demonstrates the party-civil service link. The party-tender link is evident in article 19(2)8 which states that it is the politically appointed executive director who has to maintain a general list of external experts which are to be employed when preparing for a public tender, i.e. in a PTC: [T]he Executive Director of the agency creates, maintains and updates a list of external experts for participation in the preparation and conduct of procedures for granting of public tenders.

In addition, article 20(1)1 regulates where experts could be recruited from: the trade association of relevant expertise to the tender, the civil service and any individuals who consider themselves as experts in the respective field of the tender auction: The list according to art. 19(2)8 includes persons who have professional competence, connected with the […] public tender, and: 1. are nominated by professional associations and organizations from the respective sector or from bodies according to art. 19(2-4) from the Law on

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the Administration, with a notice of their professional competence, or 2. Individually have submitted such a claim […]

In other words, the APT director is a party appointee, who in turn can make political appointments of experts. Those experts are then used to formulate the specifications public tender offers have to meet in order to be allowed to compete and be considered at the auction. Article 8(7) of LPT states that prospective employers have to include experts in the execution and assessment of public tenders, where if they do not have any such experts at their departmental disposal, they can call external ones: In preparing for the procedure of granting a public tender, employers are obliged to provide for the preparation of technical specifications, the methods of assessment of offers in the documentation for tender participation […] at least one expert who has professional competence connected with the tender object. When the employer does not have at their disposal [civil] servants, who can meet the professional competence requirements, then he provides external experts from the list specified in [19(2)8].

The crux of the matter is essentially here. According to Popov, the law implies that it is up to prospective employers to determine whether they have or not the intradepartmental experts under their subordination to carry out the public tender (2013: 1–3). Because, as we already demonstrated in previous chapters, the entire Bulgarian civil service rests on political appointments. Therefore, any departmental chief is under party’s control and in turn will act in the interest of the party, especially when it comes to selecting the members to sit at the PTCs. In Popov’s parlance, these in-house experts are the appointed experts (2013: 1–3): If the employers have an interest not to observe the suggestions in art. 8(7), [they can appoint] a convenient for them expert, [who] will establish criteria which will only be met by the desired public tender candidate. […] We are left [to depend on] those who will nominate the experts to forego their own personal interests and to demonstrate righteousness in carrying out their mission.

In other words, political appointments in the civil service facilitate the covert selection of the party insiders at public tenders. In the absence of any formally stipulated criteria for assessing one’s level of expertise, there is nothing to prevent a prospective employer to appoint his

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subordinates as “experts” in the preparation and execution of public tenders. Ultimately, because of being dependent on those who have appointed them, those tasked to oversee and select the winning tender will develop such criteria for tender participation and bid assessment, which will narrow the outcome more or less to the only one participant (firm), as desired by the party bosses. The only clarification one could make to the above is to add that this dynamic materializes in the PTC which is the actual body of experts and servants that presides over tender auctions and selects the winning tenders. Article 34(1) states that ‘The employer appoints a committee in order to conduct the public tender.’ Articles 34(2–3) also specify that the membership of the PTC has to be at least 50% populated by experts and if those are not available, those should be recruited as per article 19(2)8. And it is exactly here where Popov’s dynamics above takes place. Employers convening a PTC determine whether they have the necessary experts among their staff to carry out the public tender, without having any obligation to include external experts. In other words, a party’s ability to interfere in the work of PTCs allows it to preselect desired groups as main contractors. This means that articles 20(1), 19(2)8 from LPT (October 2014) and articles 19(1–4) from the Law on Administration allow the party in power to control the membership of the PTCs by first appointing the head of the central or local executive structure and then by specifically allowing the same political appointees to make their own appointments to staff the PTCs.

Conclusion The dynamic revealed in the above paragraphs is essentially a case of La Palombara’s parentela. Granted that these dynamics are a bit further from actual policy-making, the logic under which they unfold, however, strictly follows the parentela. We have observed how a ruling party can exploit political appointments to legally influence the decisions taken by the PTC, which eventually is a civil service structure. We have observed so far that the Law on the Administration and Law on Local SelfGovernment and Local Administration enable the central or local ruling party to dominate the respective administration with party cadres. The same logic of party patronage is evident in the Law on Public Tenders, which enables the ruling party (centrally or locally) to stack PTC

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membership with loyalists, who in turn will mold the auction requirements so to fit the desired party insider firm. The last piece of the puzzle, one might argue, is the link between political parties and the suspected state contractors. After all, the parentela also features the dynamic where the group expresses an interest which the party then delivers through interfering in the civil service. In this case, the question is whether there is any evidence to indicate that party interference in public tenders is the product of a preexisting agreement with an insider? This link will be presented in the following chapter. As already mentioned, this particular qualitative data is multidimensional and although it is attributable to the present chapter, we will discuss it in the much more pertinent case of type two parentela in the following chapter. There we will focus on the party insider relationship and the coercive parentela dynamic that the BPS discovered. Probably here is the space to briefly comment on type one parentela from the perspective of the oligarchic model, which we will discuss in Chapter 5 in more details. At this point, we can say that the parentela could be seen as a mechanism of enrichment of the party and its insider. Against campaign contributions or any such resources provided by the insider, the party will interfere in the civil service in their economic interest. In this case such interference comes in the form of public tenders, although there is nothing stopping us from generalizing further to areas that could have immediate effect on an insider’s standing. The fact that we have strongly corroborated the existence of party interference in the civil service provides us with the confidence to expect likewise interference to the interests of the party insider on all levels of the Bureaucracy. For example, the mobilization of party civil service appointees, say on minor amendments business standards could have tremendous effects on the market dynamics, which might render the party insider as one of the few companies eligible to do any business. Seen from this light we can see both the party and its insider as a form of an elite unit, which is facilitated by the parentela dynamics to expand economically and politically, at least for the duration of the government. In the next chapter, we will see another behavior of the very same elite unit, or rather, parente, where instead of simply trying to occupy the civil service with its own nominations, an insider can have their market competition put under the pressure of intense inspection from the Bulgarian regulatory agencies.

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References CPC (Commission for Protection of Competition). (2010). List of Circumstances, Whose Presence Arouses Suspicion for Auction Manipulations [Cпиcък нa oбcтoятeлcтвa, нaличиeтo нa кoитo oбycлaвя cъмнeниe зa тpъжни мaнипyлaции] (CPC Decision Nr 570 of 20.05.2010). Retrieved from http://www.cpc.bg/storage/file/CPC%20Check%20list%20Bid-rigging%20 final.doc. MD5 checksum: 407ddeb0a8e244a585c89a005d5cf736. Greer, A. (1994). Policy Networks and State-Farmer Relations in Northern Ireland, 1921–72. Political Studies., 42(3), 396–412. La Palombara, J. (1964). Interest Groups in Italian Politics. Princeton: Princeton University Press. Popov, G. (2013). Written Policy Statement on Proposed Amendments on the Law on Amendment and Addition of the Law on Public Tenders 302-0114/29.08.2013. Reference number: 167/27.09.2013. MD5 Checksum: 6a74fc54993c127d49894e0e84804620. Shumenska Zarya. (2015). Issue 40 (global issue) (12420) of 27.02.2015. Copy in possession of author. VUARR (Higher School of Agrobusiness and Regional Development), VUARRIRI (Institute for Regional Research at VUARR), & BCC (Bulgarian Construction Chamber). (2014). Status and Problems of the Construction Organizations in Bulgaria and the Role of the Chamber of Bulgarian Constructors in the Solving Those Problems. Sofia: VUARR-IRI. Retrieved from http://ksb.bg/images/rezultati.pdf [Bиcшe Училищe пo Aгpoбизнec и Paзвитиe нa Peгиoнитe (BУAPP), Инcтитyт зa Peгиoнaлни Изcлeдвaния (BУAPP-ИPИ), Кaмapa нa Cтpoитeлитe в Бългapия (КCБ). (2014). Cъcтoяниe и Пpoблeми нa Cтpoитeлнитe Opгaнизaции в Бългapия и Poлятa нa Кaмapaтa нa Cтpoитeлитe в Бългapия пpи Peшaвaнe нa тeзи Пpoблeми, Coфия: BУAPP-ИPИ].

CHAPTER 4

Type Two Parentela as an Instrument of Coercion

In Chapters 2 and 3 we focused on demonstrating the existence of the— shall we say—classical parentela, as defined by La Palombara. This is namely, the cooperation between a ruling party and its favorite, insider group, where the former interferes in the work of the civil service in order to deliver benefits to the latter. Chapter 2 was compiled on the basis of the 26 elite interviews. When applied one to the other, the totality of these respondent experiences in either observing or participating in the party-insider group relations, we could distinguish the elements of the parentela. However, one particular weakness, one might point out, is that there was no tangible evidence of the parentela as a network in action. Thus, Chapter 3 addressed this complaint by looking at the dynamics in the distribution of public tenders in the Bulgarian construction sector. The analysis was valid in 2015 while the initial doctorate report was drafted, and continues to being valid until the discussed herein legislative articles are amended. The chapter argued that there is evidence of largescale construction tenders given out to party insider groups, which in turn comprise nebulous concertations of firms, (alleged) oligarchs or any companies who act together to protect their collective interest, which is to gain privileged access to policy-making and public tenders. Not disclosing specific company names or those of the individuals involved in parentela relations meant that the chapter did not address the final

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element of a complete parentela: the evidence of party insider group cooperation. Such form of cooperation, particularly in public tenders will be presented here, because this particular data is multidimensional, and in light of the following discussion, it serves a better purpose here. The present chapter, in turn, will focus precisely on the details of the new party-group dynamic labeled type two parentela dynamic or simply type two parentela. It stands for the practice of prejudiced regulatory inspections (PRIs) where the regulatory agencies approach a targeted business for an inspection with the concealed intent to find enough evidence of malpractice which will warrant the rescission of previously granted licenses of operations, the freeze of bank accounts or the discontinuation of any business activity altogether. In other words PRIs are used as an instrument of coercion where the objective is to incapacitate a targeted business with punitive administrative and legal measures so that it loses some or all of its market shares. This is what is identified here as the coercive arm of the parentela, because both the party and its insider use it to affect their rivals. The party insider uses these as an instrument to gain advantage over their market competition, while the party uses PRIs against its internal or external opposition. A third use of these PRIs has also been reported, namely, as an implement of racket by the party and/or its insider. In this case, PRIs are used as a method of extortion against neutral outsiders, who refuse to take part in the public form of manipulation of public tenders. As one respondent will elaborate: you are either with us or against us. This is the second dynamic that comprises the extended parentela, which will be discussed in the next chapter. The important points here are that PRIs follow the general parentela logic, as it is facilitated by the politically appointed civil servants. With that, PRIs constitute another case of party’s interference in the civil service. The difference is that instead of influencing the policy-making process or the award of public tenders, the political appointees are used to mobilize the civil service regulators to act against parente’s rivals: political and economic. We will present the second parentela dynamic in the context of the following uses: as a form of extortion, party insider’s attempt to clear market space for themselves and as an instrument of political coercion. In the course of interviews, the study came across a number of respondents who at first sight seemed to describe parentela relations, when invited to discuss and comment on the relations between political parties, interest groups and the civil service. Upon closer examination, however, it turned out that they identified a new and more conflictual

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parentela dynamic namely, type two parentela. They referred to the fact that ruling political parties and their insider groups not only sought to exploit their access to the civil service for collective benefit, e.g. public tenders, but also to coerce their rivals. Such rivals in this case would be any firms, companies or individual businessmen who act as business competition to the party insider group. Other rivals could be the sectoral trade associations who oppose certain governmental legislation. Internal dissenters, too, could be seen as rivals and be engaged in type 2 parentela. The new dynamic is similar to La Palombara’s parentela (1964). A political party in cooperation with a favored group, i.e. the parente, exploits its access to the civil service through party political appointments. However, instead of accruing benefits to themselves by amending legislation or bending the rules for the award of procurement contracts, the parente engages in administrative coercion. Such coercion in this case is best described as prejudiced regulatory inspections. Usually, the regulatory agencies of the state are tasked with oversight of all business activity in the state and so conduct inspections in order to ensure that the latter complies with state regulation. For example, such inspections could be to ensure compliance with the tax code, health and safety standards or environmental legislation, or that the business has all required licenses of operation, etc. In an environment of civil service subordination to the ruling party, then, such powers of inspections could be used as an instrument to exert undue pressure on select businesses. As such inspections require that companies limit their business activities either because their bank accounts are frozen or their licenses are temporarily revoked, any such inspection has the potential to incapacitate them and bring them closer to bankruptcy. A party insider, therefore, could use regulatory agencies as a way to impede their direct market competitors by exploiting its access to politically controlled state regulator. A political party, in turn, could use such inspections against the businesses that comprise the trade associations that oppose their policies; or target the businesses of inner party dissenters. More strategically and with particular reference to our oligarchic model, prejudiced inspections are a convenient mechanism to affect the business structure of rival party–group elites, i.e. other rival parente: either those who are no longer in power, or those who aspire to be. But this is a point which we will develop in the next chapter. The next question we will deal with in the following sections refers to the forms of application of PRIs.

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An Offer You Cannot Refuse The second parentela dynamic was first detected in the answers of two of the earlier respondents in the study: Golemanov and Kuzmanov. Remarkably their mutually independent thinking was identical in distinguishing not only type one parentela, but its new extension. Both of them also accepted that parliamentary elections acted as an external shock to the existing party-groups relationships, although this theme will be discussed in the next chapter. Most importantly they argued that party insiders could gain better market standing in two ways. The first one is by dominating public tender decisions, which was reviewed in Chapter 3, and the second: through prejudiced regulatory inspections. Respondent Golemanov argued that Bulgarian elections are an opportunity for the formation of a new close party-group relationship. He explained that ruling parties are the natural center of gravity for many individual business players who are eager to take advantage of their possible privileged intra-party standing. Vice versa, political parties are equally open for such possibilities, as long as there is a mutual benefit. The deal between the two rests on the exchange of favors where the party provides some form of business advantage to the prospective insider in exchange for usually campaign contributions from the latter. Accordingly, it may also be part of the party insider deal that the insider nominates their own trusted protégées for party political appointment as key civil servants or vice-ministers. Such appointments will guarantee that the interests of the insider are met. In his view, at the heart of politics lies the battle for appointments in the civil service. In a similar vein, Kuzmanov sees Bulgarian politics as the battleground of political versus economic networks. Accordingly, if the economic elites were once able to exert undue influence in the period immediately after the regime change in 1989, particularly the Multigroup Corporation, now the tides have turned. The ruling political elite today is able to overpower any business actors by mobilizing the politically controlled civil service. In agreement with Golemanov, Kuzmanov also sees the massive administrative sweeps with every party change as the most important action of any political party that ensures that the resources and capacities of the central executive structure are under its control. The prospect of gaining a party’s favor, then again motivates certain businessmen to join or cooperate with political parties with the hope that the latter will support their business somehow. So far these dynamics overlap with La Palombara’s parentela, or type one.

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However, both respondents also converged on an additional, conflictual dynamic between the parente and an outsider group. For example, Golemanov argued that for any ruling party with orbiting insiders, i.e. a circle, to remain in power, it is imperative to coerce former or concurrent rivals: But to establish this circle of [privileged] firms, you need to remove the competition and to create monopoly. /You mean to eliminate the other circles--S/Precisely! Well, not exactly, but to parry them. To parry them! Hence, battle for political power. You use state power for personal interests […] [the] battle is for that appointment [...] /enacting theatrically/ “If Mr. X gets appointed, I will be fine, and my firm will be fine! If not, there is a chance they will “draw the knife on me””.

The respondent’s use of ‘remove the competition’ implies some form of pressure on said third actors, i.e. the market competition. With the phrase “to draw the knife on me” the respondent indicates that the mentality of those groups vying for party insiderness is such that losers face political and business extinction. In other words a ruling parente is using its positioning to extinguish any form of political, economic rivalry, and particularly that from other parente. Kuzmanov, in the same vein depicts confrontation with rival groups as another course of action that might be taken by the parente. In this excerpt he begins by outlining the classical parentela: Politicians want to have enough financial mass so that when they retire, they can transform into business actors. […] That is why every party has its own circle of firms which works with it. If the party is in power - they work together. If the party is not, the latter begins orbiting around the new party in power.

However, he then continues in the unexpected direction where the PRIs are the result of entrepreneurs refusing the offer to cooperate with the ruling party. We are left with the impression that the term is a code word for racket on part of the ruling party, or in our case, by the parente: Now, there are other cases where someone says “I am not going to pay them any more” and of course they pay for it. In the time frame of a few years they can destroy his business using legal means. […] And that is why electrons start gravitating around that political subject […] What

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we observe today is the destruction of business. Say you have a lucrative business. They make you an offer, but you tell them “Sod off!” /enacting theatrically/. “OK!” /replies to self/ But after that some strange legal things begin happening to you until one day your business enters a phase in which it can no longer expand. You then, willing or not, either sell it or go bankrupt. S: Who makes the offer? R: You can never go back and identify the chain of individuals and say: “Here, that one made the offer and he is connected to that one”. Everyone knows that those men are connected /emphasises/, but this is impossible to prove. If after all by accident someone decides to prove said relationships, [they will] get fired.

In a way Kuzmanov paraphrases Golemanov’s argument earlier that as soon as a new party comes to power its insider begins to look for ways to expand its market shares. The offer, then is merely the peaceful form of intimidating the competition. Later interviews also corroborated the idea that those who refuse it will have to brace for PRIs. On other occasions, the offer is a form of intimidation or racket in the guise of an invitation to take part in the manipulation of public tenders. Accordingly, if the target outsider is granted a public tender, they will have to redirect some of the public monies paid for the project back to the party (Rumenov, Dobromirov). Kuzmanov emphasizes in addition that the offer comes from the party in power: S: Is the origin of the offer political? […] R: Entirely political. I am telling you again: We have had periods as with the government of Berov, or that of Videnov, if you will, when the economic actors pursued their interest /unintelligible/ [but] they were interested only to take for themselves. They were disinterested in the politicians. However, there is another scenario […] where the politicians exert powerful pressure on business one way or another – the whole is motivated politically. And I am saying again, how could you explain [seeing] a struggling businessmen rush to enter politics? S: To protect their business? R: And to expand it […] therefore it follows that the political network dominates over the economic one.

In other words, according to Kuzmanov, while in the past business groups may have been in a more favorable power position vis-a-vis ruling

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parties, this is no longer the case. Political parties and their insiders today are in the position to eliminate businesses through the use of prejudiced regulatory inspections. One cannot help but notice that if Golemanov only implies that the ruling party and its insiders can harm their joint opponents, Kuzmanov is explicit and states that this is through both prejudiced litigation and inspections. The importance of Kuzmanov and Golemanov, again, is that their mutually independent thinking reflects the logic of the parentela and, unbeknownst to each other, both of them identified the second parentela dynamic, which we coded here as type two parentela. However, the common theme among both respondents and the rest who also mustered the brevity to speak on these matters in the following paragraphs suggests that the offer is a form of racket, intimidation or coercion where the targeted business is made an unfavourable or a high-risk offer, which will limit its market shares or potentially transfer the ownership to a party insider group. Meanwhile, those who refuse it will be subjected to PRIs. We ended the previous chapter on the malformation of public tender procedures with the promise that the present one will provide the missing piece of the puzzle: the element of cooperation between the ruling party and its insider in the context of public tenders. We will address this deliberate omission here, as the data below is also an example of the offer as discussed by Golemanov and Kuzmanov. Two respondents observed that while businesses might be looking for ways to cooperate with political parties on public tenders, the reverse is also true: that political parties or factions thereof proactively seek out businesses for the same purpose. Again, refusal to accept this offer is met with retribution: According to Dimitrov, it is commonplace for political parties to seek out businesses that could be suitable partners in the bending of public tenders. However, as prospering firms appeared as more suitable candidates, he stated with relief that working at a loss for the past 5–6 years actually spared him from being approached with any such offers that he could not afford to neither accept (transfer ownership) nor refuse (or face PRIs). Rumenov, however, was not that lucky. Operating at a net profit of millions of leva, he was approached by an envoy of the ruling political parties at the time who directly offered him the opportunity to win a fuel sector tender (which was pending public announcement) against giving back some of the monies dedicated to tender’s execution. That would have been party’s fee for doing him this generous favor. As a result of his

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refusal, he underwent a barrage of inspections. Given its importance, the account of Rumenov is quoted at length: R: […] So, a representative of a given party central visited my firm and introduced himself and said “We have reviewed your firm as a suitable economic subject over which we can put an umbrella and calculating the economic interests, there are benefits for the respective party as well.” That is it. Those were parties B and A. And now, what happens when you decline, /rhetorically/, as I did. My question was “This party configuration at present, how long is it going to rule: until New Year, until May, the whole mandate?” [the reply was] “However long we can last, as far as we can make it.” And I said, “Fine, but my firm is 20 years old and so far I have not had such attacks to participate in the circumvention of the law, crudely put, contraband and such things. I have not had such problems and I do not intend to.” […] S: It is interesting for me when that representative came, what did he have in mind by saying “an umbrella”? R: This means the securing of exclusive access to public tenders. In Bulgaria there is no stock exchange market for public tenders. It is fictitious. You just go shopping there. You go in and say, the Ministry of Internal Affairs (police, sic) is seeking to purchase fuel for [some] prisons or whatever, and they tell you for instance that “The respective contract is 5 million leva [and] if following the market prices, you will win 100 thousand leva. However, we will increase the price for delivery with 20% and you will give 40% of the total profits back to us, and if you agree, you will take the tender”. This is what was meant: 20% for the players, 20% for the party coffers. This is only half of the story. The participation – whatever it is – in the Public Tenders /self-interrupts/ even now with my partner, my son, /inaudible/ there is a new tender coming up tomorrow on the stock exchange market for public tenders. It is about the delivery of fuel to army airplanes for 6 million leva [but] with the stern warning [against me]: “Careful what you are doing. Make sure you are not seen here because heads will fall”.

In short, with the change of government at some point in the past, the respondent was approached by a representative of the new ruling political parties with the offer to become a core insider and be privileged in the competition for public tenders in the fuel sector. In this offer, what they have to do in return is give back to the ruling party a fraction of the budget they will receive to carry out the tender. The respondent will specify artificially heightened costs for project’s completion and then the

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difference between thus dedicated budget and the actual costs will be given back to the party. Here is the deliberately omitted evidence from the previous chapter. It is not in construction but that is no matter. There is nothing to suggest that such practices will be limited to fuel tenders and not spill into other tender areas. Again, the emphasis here is that the party initiates the negotiations and that a refusal to cooperate leads to coercion, i.e. type two dynamic. As a result of refusing to cooperate, Rumenov was barred from taking part in fuel-related public tenders with the direct threat that “heads will fall”. On that point, he continues: R: They have organised against me, as soon as I declined, those [men] organised all of that against me. I was now a bit late for the interview because of the commission at the State Reserve is investigating me for a second day now. […] Now on Monday, the state transport inspectorate (STI) will come because I have 15 trucks and the STI decided to check the itineraries […] and whatever you can think of, despite the fact I have never been caught in an offense, neither me nor my drivers, that relate to the Laws on State Automobile Inspection, the Movement on the Roads or on the Transportation of Dangerous Cargoes, but all possible instances (agencies) were sent, to show me that “Since you are not one of us, you are against us.” […] Ever since then, all possible state regulatory agencies – all! /emphasises/ – such as the agency on the environmental protection, on labour protection, fire brigade, customs, labour inspectorate, auto-transport inspectorate, [agency on] emergencies and natural disasters, everything that you – the State Reserve! /exclaims/ – think of. Total inspections, all day long! With the sole aim to justify the issuance of an Act of Misconduct – whatever it is: overt, covert or whatever. This is the situation in Bulgaria at the moment. […] [According to] the Law on Excise and State Storage, with three such Acts of Misconduct one is in danger of being suggested for the rescission of hitherto granted license of operation. So, the excise department of Sofia Customs is holding me constantly with two such Acts (of Misconduct) which I fight successfully in court, but in their place new ones grow like mushrooms for all sort of absurd reasons entirely devoid from fiscal considerations, that is, not because I evade taxes.

In short, the respondent above explains that the number of agencies that were sent to inspect his businesses is in an avid response to him refusing

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to cooperate with the ruling party at the time to malform public tenders to joint benefit. The message is simple: either with us or against us. Dobromirov also confirms the practice of parties proactively offering select groups an insider type of exchange. Just as with Rumenov, he also expressed the common position of his construction peers that it was those “intelligent men” who made visits and offers on behalf of political parties. According to Dobromirov, political parties and their insiders usually study a firm (outsider) for overall profitability before an offer is made. This is exactly how Rumenov was approached by the party envoy “we have studied your firm”. If it is declined, the targeted group can only expect vociferous inspections from all regulatory agencies, particularly tax and police. Similar to the offer made by the party in power, Varbanov reported being made an offer by a party insider group also working in the field of construction. In his case, the offer acted as a condition to participate at a construction tender of a section from a highway. If Varbanov wanted to win the tender, he would then have had to sign off half of his firm away to the insiders. While he did not report any repercussions on his business as a result of that, he strongly agreed with the argument in principle that state agencies are used by political parties and their insiders to destabilize the outsider businesses with a view of absorbing them. The purpose of the accounts above was primarily to introduce the term prejudiced regulatory inspections, as a newly discovered adjunct dynamic to the parentela policy network. The argument is not that the BPS found a new policy network, but that it found a new dynamic the parentela. In the following paragraphs, we will look at other purposes of the application of type 2 parentela dynamics: a move by a party insider, or party’s attempt to quell dissent from interest groups or inner rank-and-file.

An Insider’s Move A number of respondents claimed to be victims of their well-connected competition to oust them from the market through severe regulatory inspections. The director of a trade association, Petrov and their co-director (denoted R2) deserve special attention. Congruent with Donchev, they argued that all amendments in business permits eligibility criteria can be used by party insiders as a mechanism to beat the competition. According to this view a party insider gains advantage over

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the competition by using their access to the party and civil service to influence a change of licenses and standards, so that only the insider group meets the new standards, hoping the competition that finds it harder to adapt and ideally exit the market (also a position advanced by Donchev). However, more importantly, in addition to being sectoral representatives, they were also owners of timber companies. They explained that with the change of government, unusual regulatory activity began in their sector around 2005 until the point their firms were put under continuous and stringent tax inspections. Very much like Rumenov, Petrov and his colleague noted that despite their best attempts to cooperate with the regulator, the latter remained adamant and determined to procede with litigation. Eight years prior to the interview, the court cases are still ongoing with no verdict and with crucial documentation on the case, the respondents argue, deliberately hidden from them. At the time of interview, they were looking into suing the Bulgarian state in Strasbourg. They argued that the absence of firm evidence of wrongdoing against them indicated that the inspections were ill-intended to oust them from the timber market. Mihailov also argued that his only competitor, oligarch Q, was behind some of the regulatory investigations against his business. Unfortunately, that particular respondent insisted on the recording be stopped, save for eight minutes. Accordingly, the mechanism used in Q’s attempts to beat him was to use his access to the regulatory agencies in order to rescind Mihailov’s license of operation. (On that note, Kirilov also commented that this is one tool from the instrumentation on how to eliminate undesirable business actors.) However, after the change of government, Q in turn became the subject of regulatory pressure, with arrests and police raids, as a result of a personal quarrel with the new government (Mihailov; discussed below). Independently from Mihailov and each other, Kirilov and Kuzmanov shared the view that said police activity related to Q was devoid of any legal wrongdoing of his, but was politically motivated as a form of personal retribution by the ruling party or the new insiders. Note that Rumenov argued that police raids and arrests are the first line of pressure against a business that has lost favor with the ruling party. The accounts of Mihailov again demonstrate that the civil service is exploited to perform prejudiced inspection in order to eliminate party insider’s market competitors or party’s political opponents (discussed below).

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Respondent Hadzhiev, too, agreed that the use of regulatory agencies against certain businesses was in fact a sign of conflict between the party insider and outsider businesses. He argued instead that it was not police raids but tax inspections was the main weapon. Along the same lines, respondent Stoyanov argued that the undue regulatory investigations that they were involved in at the time of the interview did not necessarily originate from the party. He disbelieved his own importance stressing his very strong suspicion that his competitors use their access to the regulatory agencies provided by a faction within the ruling party to instigate tax investigations against him. In conclusion, possibly Nikolov provided the best summary of the type two parentela dynamics and the variety of mechanisms used to pressure outsiders (timestamps are provided to accentuate on the four-second silence of the respondent at 5703): 5651 R /repeats to himself researcher’s question/“Otherwise how could they destroy you?” They don’t give you any tenders, they close your markets, they send you control organs (regulatory agencies, sic) – 5703 /Respondent becomes silent; 4 sec pause/ 5707 R You stop him from everywhere 5714 S How can they take your markets away from you? 5717 R […] when they send a Financial Revision team to you and, let’s say, when they claim that you owe them 10 million Euros or Leva, whatever it is. This kills. This is deadly. [Because, g]ood luck trying to prove in court in the next four years that you actually do not owe that money, and you will prove it indeed but you would be done for. In practice you lose your market share because you cannot sell, as [during litigation period] your bank accounts would be frozen, [and] there would be a thorough description of your storages, machines and so on, and this is how you go bankrupt. 5752 S Is it possible to survive in the market without having to cooperate with the parties? 5803 R Possibly there are some people who win their bread honestly and succeed to support small and middle size enterprises. […] but in principle, they are so few that in a city like [the one we are currently in] these are no more than 20–30 firms. 5827 S Some of the previous respondents used the term “racket” on part of the state. I do not understand this. What would they have in mind

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with “racket on part of the state”, and that is why I asked that (previous) question? 5844 R /repeats, annoyed?/“racket on part of the state” /unintelligible/ Someone comes in here and registers that – say they came from the fire brigade – and they tell you: “The fuel tank is improperly fitted, your liquid gas tank is too close to the road, etc.” But the fact that they had earlier given you the license and permission to sell fuel is of no relevance at all, because in the end they order you to stop all sales. You then are forced to relocate down the road but the costs to do that would be prohibitive. If you try to figure out the weak spot of a business in this way, you will always find something. Nikolov clearly demonstrated hesitation whether and how far to disclose, evident at the 5703 timestamp. Nevertheless, he took a decision to share his knowledge although he couched it in as neutral phraseology as possible, i.e. expressing it in terms of a model and dynamics. The statement of Nikolov describes the type two parentela dynamics in its totality and is what is taken here to represent its core dynamic. It is the deliberate use of inspections from the regulatory agencies to either drive a business competitor out of business or pressure them into parente’s submission. The next two sections will discuss type two parentela in the context of party’s suppression of external and internal political dissent.

Internal Party Dissent Respondent Golemanov spoke further from personal experience on the subject of the use of type 2 parentela as a retribution against internal party dissent. He intimated that during their tenure as a town’s mayor, he sought to speak his own mind on numerous occasions at local city council meetings, in total disregard to party B’s hard line. While also having a business and a few years spent in intraparty friction the respondent was subjected to ruthless tax investigations. Speaking in agreement on the use of the state administration as a tool of repression against internal party dissent, Kirilov gave a more recent example with a different political party: R: It is like the seduced and the abandoned and those abandoned from [party S] are doing tricks one against the other. That is, until yesterday you had been in the group of the anointed ones [of those who] had been crushing businesses, and taking it away from others, and that you had

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intimidated their children is of no concern to you because you are on the side of the victor! And you do not notice this, you only smile. But in one moment, however, they make the lists [of parliamentary candidates] and you are kicked out. And then you say, “OK fine, but what we have been doing to the others until yesterday will be done unto me tomorrow, because I am no longer close to the Premier. I have now become equal to the rest. I am no longer part of the strong, of the good and righteous”.

It should be noted that the statement sounds exaggerated somewhat with the claim that business is “taken it away from others”. Nevertheless, the important point here is that it bears the mark of intraparty repercussions under the guise of regulatory inspections geared toward eliminating the businesses of party dissenters.

External Group Dissent Another form type two dynamics resulting from the need to punish politically opposing trade associations by targeting their business members with prejudiced inspections. We already mentioned the case of respondent Mihailov. Similarly, respondent Hristov hinted that not always do professional representative bodies voice the grievances of their members at the civil service forums. Rather begrudgingly he admitted that some groups refrain from voicing their problems for fear of repercussions. Respondent Donchev was adamant that there is a reverse pressure from the ruling party back on formal interest groups, particularly CIEB (emphasis added): S: In the context of the state administration and interest groups, does the state administration provide a more effective access to the policy-making process than the direct contacts with the ruling party? R: […] the representation of business in its standard forms is to some degree well structured, [yet] it is empty from any contents. That is, a huge part of the business organizations are also captured and they are not independent in what they say […] because they are connected to the ruling parties in one way or another and with ruling politicians, or even if they are not directly connected they are highly considerate [of ruling party’s position]. In the moment in which they are considerate not with the interests of their members but with what the power (government, sic) wants, they are not authentic representatives of business’ interests. [As a result], to a great extent the

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classical tripartite dialogue suffers because business managed to create / self-interrupting/ I mean I am personally dealing with this project for 7–8 years, there was a lot of authentic and strong representation [but] later after a line of a series of attacks that business organization was practically diffused and broken. S: What were the attacks? R: All sorts, against the director, attacks on the members /Media attacks? –S/ Media, tax investigations, the whole arsenal. From the means of pressure /pause, self-interruption/[from] the beginning of Transition [the intention] was exactly that, to have fake participants from the civil society, fake NGOs, fake representatives of Labour, syndicates, fake business representatives, fake media. Everyone who took part in the debate had to seem independent, but in fact they had be controlled from one and the same centre.

According to Donchev in other words, interest groups have two options: to brace for a parentela type two conflict or appease the government on legislation that they disagree on. At the same time, the emphasized thread in the quotation above indicates that another strategy of the ruling party is to reciprocally appease dissenting interest group’s leadership by offering them privileged deals. This is not stated directly but it is a probable implication given the practice of making offers one cannot refuse. As if to deliberately support the position of Donchev, Rumenov stated independently at the start of his interview that he deliberately refused membership in the Gas and Petroleum Association because he felt it did not protect his interests, but those of the colluded interest groups and party leaderships. He was particularly disgruntled: R: My business, this is the gas and petroleum association, these are selected /self-interrupting/ not all of us are members in these things, traders and players in this business. Well, there, the party in power and the legislative structures select who to be a member in this interest group (responded did use the term interest groups, sic). Discussing the legislative changes with the group and other normative and sub-normative (primary and secondary legislation, sic) a hidden interest is pursued of a lobbying group. Everything in Bulgaria is subjugated to that. […] So, in the trade associations, only those directors are elected who are convenient to the respective parties in power. And from there on, they play together. No-one explained, for instance,

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where businesses would find money for the increase of the minimum salary […]

The position of Rumenov again reveals the two options interest groups’ leadership face when dealing with the party in power. First, either collude with the party leadership and allow to be seduced (as per Kirilov), or, second, try to oppose the policies you disagree to and be put under tremendous amount of prejudiced regulatory pressure, as per Donchev. Respondent Nikolov, too, advanced the same discontentment from the work of Trade Associations, arguing that they collided with political parties into a “select society” where the role of such groups was to facilitate party’s to stay in power. Of course, the present study is only able to register these relationships as opposed to assess their scope. However, what transpires is that party’s ability to appoint in the civil service is used as a tool of repression against groups, both inside and outside party structures. Moreover, this is true for all political parties. No respondent made an explicit identification nor claim that this peculiar use of regulatory inspections belonged to a specific political party.

Conclusion The present chapter discussed the second and newly discovered strand of the parentela policy network, namely, type two parentela dynamic. As with La Palombara’s parentela, at the core of this dynamic lies the cooperation between the ruling party and a privileged party insider group. The difference here is that instead of eliciting administrative favors related to policy-making or public tenders, the party insider requests prejudiced regulatory action against their market competitors. The ruling party at the same time also takes advantage of its administrative control by exacting the same type of action against its political opponents or actors who refuse to cooperate on arrangements of mutual monetary gain. But the importance of this chapter is that it provided the last piece of the extended parentela model. Both parentela types comprise the extended parentela which looked from a distance, raises the question of its effects on the democratic status of the Bulgarian state. Previous chapters accentuated that, facilitated by political appointments, any parentela relations helped the party and its insider exploit the civil service. For example, we observed in Chapter 3 how the parentela arrangements

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facilitated the malformation of public tenders to the benefit of party insiders. Similar type one exploits are completely feasible anywhere in the civil service where executive and directorial positions are filled in through political appointments. But the most important point here is that the present chapter implicitly states that seen from a macropolitical level, the parentela arrangements facilitate the formation of oligarchic elites. If the parente in type one merely seeks to accumulate political and economic power, rather passively, the parente engaged in type two dynamics is expansive and retributive. This elite kernel, therefore, seeks to eliminate market competition and subdue political dissent (external or internal). In other words, type one and two dynamics are not mutually exclusive but are performed simultaneously. While concentrating power, an elite can also engage in persecuting its political opponents. Thus, we can already say that the two parentela types could be seen as the elements of a single dynamic, i.e. the extended parentela, which both creates oligarchic elites and eliminates them. Why “oligarchic” and what is the extended parentela dynamic in more detail will be discussed in the Chapter 5.

CHAPTER 5

The Extended Parentela as a Model of Party-Centric Oligarchic Relations in Bulgaria

At the start of the present volume we introduced the parentela as a policy network model developed for the first time by Joseph La Palombara (1964). He studied the relationship between the Christian Democratic (DC) political party in Italy and the interest groups that competed for privileged access to its leadership Confindustria and Catholic Action in particular. The parentela was developed with reference to the close working relationship of the DC with Catholic Action, which reflected the interests of the devout electorate. In its core, the relationship is simply about a political party that interferes in the work of the civil service on behalf of its party insider group. In the Italian case, greatly facilitated by a politically controlled civil service, the parentela relationship allowed Catholic Action to control the cinematographic content released publicly in the 1960s Italy (La Palombara 1964). The absence of recent research into the parentela, as well as the other policy network models, raises the question of the analytical utility of those terms, and whether those were in fact Western policy-making arrangements specific for the period 1950s to 2000s. The only other research that has confirmed the existence of parentela relations is that of Ian Greer (1994) who analyzed the relationship between the Unionist party (UP) and the Ulster Farmers’ Union (UFU) in Northern Ireland for the period from 1920s to 1970s. He, too, found that the relationship between the UP and the UFU conformed to the parentela. The government of Stormont consistently elected as Ministers of agriculture nominees from the rank and file of the UFU, who in turn oversaw latter’s © The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3_5

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interests. Again, however, the absence of much research into policy networks of the qualitative approach, save for Compston (2009) most recently, suggests some withdrawal from the field which could be attributed to either distrust of the qualitative method or in the conceptual framework. The initial question that motivated the present study was to address this uncertainty: whether the parentela still exists today, and whether it still has any utility for us? More specific to the Bulgarian context, the study addressed the question whether the parentela relations could explain the party-group relationship described in Bulgarian publicist narratives as circles, where party functionaries were recorded forming close friendly circles with private businessmen, christened by the media with various names, such as Olimp, Monterrey, Admiral, etc., usually after the restaurants where they met. The theory of the parentela itself too posited the question whether the parentela is formed by hegemonic political parties. Bulgaria, then, was chosen precisely because it lacked any hegemonic parties but still exhibited features of the parentela. The results of the Bulgarian Parentela Study that followed confirmed the parentela dynamic, registered earlier by La Palombara and Greer, revealing thereby another one dynaic labeled here type two parentela. We already reviewed both dynamics at length in the previous two chapters. However, the one topic that did not receive proper treatment in the earlier report (Petkov 2016; 2017) was that of the relationship between the parentela and oligarchy. The founding study by La Palombara was confronted with the question whether in fact the parentela was symptomatic or an actual case of oligarchy. The Bulgarian study, too, was confronted with this question and although it engaged with this thread, did not do enough to fully develop it. Moreover, two other points added further weight to the decision to revisit this theme and analyze the data once again from the oligarchic perspective. One is the data from the respondents themselves: its richness allows for the discussion of the parentela as a model of party-group relations on a macrolevel, in which case the network also models macro-level processes. Then there is also the work of Barnes (2007) who argued that the early 1990s Bulgarian politics was an arena of rival elites competing on who will capture the state next (also Ganev 2001). In other words, his view also implies that Bulgaria harbors oligarchic dynamics, which we now appear to have re-discovered.

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In the present chapter we will combine all of the elements of the extended parentela that we discussed previously in order to address the parentela-oligarchy question. The thesis here is that the extended parentela is a model of oligarchic party-group relations in Bulgaria. The extended parentela reveals party-centric relations which seen from a macro-level of analysis outline an oligarchic dynamic. Elites begin to be formed when informal groups achieve party insider status. Once locked in a party-group cooperation, the elite unit or parente is formed and begins to expand politically and business-wise through party’s interference over the civil service until new parliamentary elections depose the party from power. The “expansion” in this case means accumulation of capital by exploiting political access (i.e. public tenders, pressure on market competitors who lack party insider access) and the spread of favorable political appointments throughout the civil service. The two endogenous processes to the extended parentela that run simultaneously are elite expansion by those in power and an elite suppression of those outside. Because the parente in power uses its control over the civil service not only to reap greater rewards for itself at the expense of its competition, but to coerce it simultaneously. The one exogenous process that exerts shocks to these relations are Parliamentary elections, where a party-change is equivalent to a new elite coming to power, reiterating, thereby, elite suppression and expansion.

A Contest Between Elites Let us elaborate on the relationship between the concepts elections, elites and competition. Being one of the few authors to publish on the stategroup relations in Bulgaria, Barnes (2007) engaged with the theory that Bulgarian politics, following the regime change in November 1989, revealed a sequence of elites that captured the state. Bulgarian political life in other words was a competition among elites on who will capture the state next, thus exploiting its political access to own gain (Barnes 2007). The extended parentela model agrees that elites in Bulgaria compete with each other and provides the extended parentela dynamics as the respective mechanism, but it contests the notions that (1) elites are exclusively actors outside political parties and (2) that a force external to political parties and the civil service mysteriously captures both, i.e. the state. To the contrary, the position here is that the advantages of private actors which the public perceives from the outside are not the

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result of state capture but of an agreement of cooperation between the ruling party and that very same private group. This is so because political parties are the actor that generates the elites, that is, they are part of the elite. The present Bulgarian status quo does not only empower ruling parties to resist external attempts to coercive capture but has reversed such odds: political parties are in the position to coerce private actors as demonstrated with prejudiced regulatory inspections earlier. Such capabilities, therefore, transform them in centers of political gravity that attract any private actors who wish to benefit from insider access to policy-making, establishing thereby the elite that from the outside seems to have captured the state. On elite formation we have to highlight Chapters 2, 3 and 4 which revealed how political parties seek to engage political access for campaign funds. It is this reiterated exchange which binds the two actors to mutual dependence and forms the nucleus of the elite, i.e. the parente. It is this parente which then competes with rival parentes or passive outsider businesses through total control over the Executive via appointments and reforms, and administrative coercion. Simply put, the extended parentela reveals that the parente acts as a temporary elite which operates until the party, at its center, loses elections. The purpose of a party’s incumbency is not only to process legislation but also to improve parente’s power-political and capital standing, which appears to be just as important an objective as policy-making. The reiteration of the extended parentela therefore both expands incumbent elites and simultaneously with that destroys others (aspiring or formerly in power). Elites may change as a result of Parliamentary elections, but that does not change the logic of the overall dynamic driven by the elite in power: aggregation and simultaneous suppression of any political and economic rivals. The chapters on public tenders and type two parentela demonstrated an elite expansion. Precisely by removing the appointees of the former party and implanting own in the civil service, an incumbent parente does not only passively monitors and control any legislation of interest but expands its own network of appointees at the expense of (now former) competing elites. More specifically, such expansion was better illustrated with the chapter on procurement contracts where parente’s political patronage effectively denied much needed funds to any rival elites with stakes in construction. Particularly with reference to the construction sector in Bulgaria, where most participants are dependent on

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public tenders, the centralization of tender distribution among a handful of party insiders is a strike at any competitors as well. Moreover, if Chapters 2 and 3 illustrated the executive-administrative expansion of an elite through political appointments, Chapter 4 demonstrated how the same elite expanded its capital. As the chapter emphasized, political parties seek to enter cooperative relationship with private businesses with whom to split the moneys dedicated to the completion of the procurement contract. So it is not only about an insider winning public tenders, as Chapter 3 implies. It is about forms of party-group cooperation which result in the generation of capital both for the party and its insider. However, as all of the above is facilitated by political appointments we have to stress that there is nothing to suggest that this behavior is in any way reserved to public tenders. Such behavior is theoretically possible in virtually anywhere in the civil service where servants are political appointees. For example, legislation on standards, licenses or any form of eligibility lends itself (in theory) as an easy route for a party insider to change the game in an industrial sector, as their market competitors will require time to adjust to any sudden changes of licensing criteria. Chapter 4 furthermore, shows another facet of elite’s administrative expansion through patronage, namely, executive agency coercion. That chapter demonstrated prejudiced regulatory inspections as an instrument of political suppression employed by the political party and its insider against any political opposition coming from businesses members of a peak interest group. However, they can also be used politically to coerce businesses to cooperate in a manner described in the previous paragraph, or be harassed because they are in direct market competition with the party insider. Again, thanks to the party political control of the civil service, virtually any one executive structure could be exploited in the very same way: to extract benefits from a politically exploitable central executive system and to mobilize state agencies to exercise coercion against any rivals.

Party-Centric Elites and Centralization of Political Power It was stated earlier that the extended parentela as an oligarchic model is party-centric. This idea was demonstrated with parentela types one (patronage) and two (prejudiced inspections), both of which depend on the political party in power in order to manifest themselves. Such party-centrism is

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important, ultimately, as it facilitates the formation of the oligarchic elites. There, however, are other indications of the centrality of political parties. The control of the civil service, therefore, and its exploitation can equally be seen as a form of centralization. At present it is only manifested as a dynamic and is not explicitly stated. After all, appointments in the civil service are not made directly by the Prime Minister but by his or hers appointees in a downward chain. Also, the case of the NCTC is indicative of the capability of the ruling party to curtail access to civil service consultations. It can either attempt filtering the groups seeking civil service representation, ignore any such consultative bodies outright, or if need-be a ruling party can coerce any group into submission through prejudiced inspections. These factors make Bulgarian political parties a gatekeeper that anyone who seeks effective political representation of any sort has to consider. But at the same time, these powers are also indicative of centralization proclivities inherent in political parties, which in the end of the day catalyze elite formation. The idea of oligarchic dynamics implies that there must be some degree of political centralization, if oligarchic, or any non-democratic consolidation is to take place. Such centralist tendencies have already made an impression in the language of the respondents in the study who emphasized on the concept of ruling party versus Government. Governments do not rule in Bulgaria, rather political parties. If the former term implies strict policy-making focus, then political parties implies a much broader scope of political pursuits. The Council of Ministers may be the highest executive body but that is only de jure. The elite of the ruling party in fact governs behind any government in power. This view stems from the fact that Bulgarian political parties are headed by party executive bureaus. In the spirit of total party political domination of the civil service the party leadership is the de facto central organ of government. Said otherwise, it is not the Council of Ministers, that governs, but the party elite embodied in the party executive bureau, which in turn is headed by the party chairman, who also acts as the prime minister. This pattern is valid for all political parties in Bulgaria since 10 November 1989. Starting with ministers every one executive position is subordinate to the party bureau which either proactively or tacitly vets the fulfillment of any executive positions and has the power to interfere in any policy it sees fit (Chapter 3). Much further than that, members of Parliament, too, are subordinate to the party elite. At Parliametary elections, Bulgarian citizens vote on closed party lists, i.e. for a pre-set list of names, as opposed to specific

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candidates. All of the Members of Parliament are first selected by the party executive bureau. All of the above, again, speaks of a democratic system ruled by occluded party centrals, and not of the evident government. It is noticeable how rarely, if at all, respondents used the word government. In their mental map, the word government was substituted with political party. The party—so far as they were concerned—was at the center of political life. Respondent Hadzhiev argued that it is political parties who rule the state with insiders in close orbit, and not elected MPs nor the Council of Ministers. The legal perspective on policy-making is blind to the reality that informal pacts between ruling parties and insider groups lie at the core of (Bulgarian) policy-making: Actually in Bulgaria it is everywhere written down that it is a parliamentary republic and respectively the supreme law is the constitution. [However,] since 10th November 1989, the state is parliamentary republic only de jure. De facto […] Bulgaria is ruled by miscellaneous parties. /emphasises/ It is entirely different the question who is connected with those Parties and how is this entire government done more generally.

Likewise, respondent Petkov shared the rather cynical position that power rests exclusively with the prime minister, who—as noted above—is always the leader of the party: By the way Bulgaria is actually only formally a parliamentary republic. The parliament is a structure for psychotherapy for the Bulgarian citizens, who need to know how bad the politicians they themselves elect are.

In other words, the Parliament and parliamentary consultations deflect the attention from the real locus of power. They are meaningless because it is the occluded party leadership that dictates the decisions of elected MPs. The Parliament and MPs are reduced to objects of misdirected hatred of the political system. Like Petkov, Penchev was as also cynical about the same 23-year period of transition to democracy. He argued that the party ruled the state unimpeded and the powers vested in the party in power—i.e. the premier—can also be at the disposal of the party insider groups. Therefore, through the party, an insider group can gain control over parts of the civil service, the judiciary, the prosecution or the secret services:

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After 23 years, democracy has not arrived yet. Everything is [politically] controlled in Bulgaria. And that is something which they see in Brussels. But they have given up on us and say that things in Bulgaria happen only with diktat and pressure. So [… it is all] about the control over the political system and political class through which [those groups] realize this power, [and it is] in the same way they control the judiciary, the state prosecutor and the services.

The above was probably one of the earlier statements directly attributable to the parentela. Penchev argues that the primary objective of any political party is the total control of the political system which includes the prevention of any opposition from Parliament or civil service. And as subsequent political parties, he argues, have also been quite good at preventing opposition, changes inside Bulgaria can only happen with outside pressure. In any case, other respondents also argued that the real power locus lies with political parties, as opposed to the government. Speaking as member of the directorial board, Respondent Konstantinov made the argument that the interest group he represents, was an occasional civil service consultations outsider (peripheral insider) to decisions of core importance to his constitutive members: [Business] does not make decisions; that would be the government. The National Council for Tripartite Cooperation […] is a consultative organ and it does not make decisions [but] we are often witnesses of how without any consultations parameters are changed which influence negatively on the business environment.

That the party is the key venue providing most effective access to policy-making is inferred from the difficulty groups experience in maintaining a long-term meaningful representation at the consultative administrative bodies. The respondent implies that key decisions made, in this case, at the NCTC consultations but by the government unilaterally, which is the party in power. Therefore, according to respondent Kirilov lobbying efforts have to target the prime minister and the party itself. Again, the respondents above speak of the party central and the party insiders as the nebulous seat of power. The implication from all of the above is that informally power is not vested in the democratic structures but centralized the parente. It is then through the hierarchical structure

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of political appointments in the civil service that this power to coerce or withstand policy change is realized. In light of the proposed model of oligarchic policy-making in Bulgaria, it is this element of party centralization that adds further credence and plausibility to the hypothesis of oligarchic consolidation (later below) because that thesis assumes absence of formally strong democratic structures to prevent political parties and their insiders to exploit their control over the civil service for own needs, and particularly to expand as a unit of elite.

Oligarchic Dynamics In the previous section we introduced our model of oligarchic relations and dynamics in Bulgaria. However, nowhere was it discussed why it is oligarchic and what its connection is with the idea of oligarchy. We will address this point here. There are a number of studies on US oligarchy and elite politics that bear strong similarity to the extended parentela. These studies either theoretically or empirically look into the questions of whether an oligarchy exists in the US and if so, how it operates. This section argues that the extended parentela is an oligarchic dynamic because of its overlap with core features of oligarchy voiced in the oligarchic literature. Probably most striking overlap between the extended parentela dynamic and US oligarchy1 is Nonini (2005) and his rendering of Briody’s research on the Carlyle Group. Briody (2003) looks into the network relationships between the Carlyle Group (Carlyle)—a private equity firm—and Washington policy-makers (2003), where the former sought to predetermine the outcome of defence public tenders in its favor, if not circumventing the “bid stage” outright (Nonini 2005: 183–185). In a further match with the case of the Bulgarian type one parentela, Carlyle’s success was due to the help from politically appointed civil servants (1; see quotations below) and obliging party functionaries (2) (Nonini 2005: 183). That ultimately translated to Carlyle’s ability to influence the functions of the military agencies in charge of public tenders (3) (Nonini 2005: 184):

1 A term used herein primarily to facilitate the argument as opposed to a statement of fact.

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(1) The group’s members have also often served in various capacities in the policy-formation network that Domhoff (2002) describes—as directors and officers (and even occasionally as scholars) in conservative foundations, think tanks, and policy-discussion groups.4 More peripheral members of the oligarchic clique serve outside the White House or Cabinet as higher-level political appointees in the Pentagon, CIA, FBI, Home land Security, and the Departments of Commerce and Treasury. (183) […] (2) They are connected to one another not only by common political party ties—the vast majority are leaders in the national Republican party— but also by shared personal and institutional experiences. (183) […] (3) Yes, the highest ranking members of the clique are clearly in charge of the official military, policing, and surveillance organs of the state—the Pentagon, FBI, CIA, and Homeland Security Administration. (184)

Inadvertently, Nonini (2005) above highlights the features of the type one parentela found in the case of construction public tenders in Bulgaria. These are: a ruling political party in cooperation with a party insider group (2 above), which does not represent an economic sector; and (1) the availability of politically appointed civil servants, and by an extension, party-controlled agency, which lent itself to party insider’s control. Moreover, we should also mention the curious fact that the Carlyle group bears its origins from the hotel where its founders conceived it, more or less in secret—the Carlyle Hotel in Manhattan, NY. This is worth noting, because this detail also overlaps with the usually nebulous phenomenon of the Bulgarian circles which the Bulgarian study (Petkov 2017) also discussed as a pop version of the parentela. These are a well-known phenomenon in Bulgarian policy-making and refer to relations between the ruling party and certain businesses. The point is that these circles bear the name of the hotels where they were conceived, e.g. Monterrey, Admiral, Olimp. It would appear that in the US context, we have found a direct counterpart of Bulgarian circles—the Carlyle Group—having been set up at the Carlyle hotel. A more substantial count on which both studies overlap theoretically is the element of coercion. One example is Nonini’s focus on what Hersh (in Nonini 2005: 186) has dubbed stovepiping, or the circumvention of routine procedures of the intelligence agencies that normally

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would assess and verify raw intelligence data. According to Nonini, under the influence of the Carlyle Group, stovepiping was put in place by the US president George W Bush and his closest advisers to intercept any intelligence data as justifying the Iraq invasion (2005: 186). The point is that forcing the intelligence agencies to directly feed the White house with raw intelligence data is a case of party political interference in the interest of the Carlyle Group which completely falls in line with the parentela. Ultimately, Carlyle stood to gain from a US invasion in Iraq, as that would lead to innumerable tender contracts. Arguably one could argue that the above is also an example of a political coercion on the civil service itself as the narrative implies that Carlyle suppressed any resistence to their plans from the respective administration. In any case, there is a much stronger example of coercion which is much more in tune with what was earlier defined as type two parentela. It is evident in Nonini’s emphasis that the core actors from the Carlyle Group had direct access and ability at least in theory to mobilize the work of repressive state agencies against their potential rivals: Through his friends in the Cabinet, the CIA, the FBI, the Justice Department, and the Homeland Security Administration, he is situated at the apex of national policing and surveillance power. In the name of national security under the Patriot Act, he has the power to authorize surveillance of and initiate official harassment or even imprisonment (without benefit of habeas corpus) of any US citizen, not to speak of bothersome ‘alien’ residents. (181–182) […] In addition to the influence of the Carlyle Group, the clique gains its despotic power through control over the formal, legal institutions of the state, but in the peculiar hybrid form of the US neo-liberal state. (184)

In other words, the description of the Carlyle Group, fully overlaps with the description of the extended parentela. Nonini sees the case of oligarchy in the actions of the Carlyle Group because those conform to the definition of oligarchy found in Webster’s Third International Dictionary: ‘despotic power exercised by a privileged clique’ (Nonini 2005: 177). Moreover, given Carlyle’s behavior in relation to public tenders discussed later in his article, he adds that oligarchy has less to do

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with legislative improvements and more to do with exploitation of one’s access to policy-making: one (clique, sic) moreover devoted at the most mundane level to kleptocracy, or rule while engaged in plunder of the public treasury.

In other words, an oligarchy is a network of actors with insider access to policy-making, who seek to exploit it for own enrichment. Both parentela types are clearly identifiable in the case of the Carlyle Group with corresponding logic the conversion of political access to capital, or kleptocracy in Nonini’s parlance (2005). So four characteristics of oligarchy stand out from the above brief comparison: First, (1) an oligarchy is about the exclusive cooperation between politicians, or rather, the ruling party and private groups, who may not necessarily represent an economic sector. It is a network which involves party factions and business actors, which are not formally bound into an association, nor represent one. This oligarchic community is amorphous, however, as Nonini clarifies that its nucleus (or the party insider group in the parentela parlance) seeks to gain simultaneous core insider status with all political parties with a potential to participate in government (2005: 183): […] although the clique does have a Republican slant to it, its members’ quest for wealth in the Carlyle Group through access to power has been resolutely bipartisan.

Again, this is also true for the Bulgarian case, particularly with the now defunct corporation known as Multigroup (scrutinized by Ganev 2001; later Barnes 2007), which the Bulgarian parentela study discussed as a past case of the parentela (Petkov 2016). Accordingly, this was a holding corporation most active in the early 1990s Bulgaria that succeeds to develop insider relationship with both parties with government-participation potential: the Bulgarian Socialist party, the Movement for Rights and Freedoms, and also potentially taking part in the formation of a third party, which was to represent its interests and those of likeminded big businesses at the time. The only exception was the conservative government of Ivan Kostov (Union of Democratic Forces), which

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put Multigroup under pressure through prejudiced inspections in 1998, which also started its demise (Petkov 2016). Second, (2) the party-group cooperation generates the identity of an exclusive community, i.e. the elite. Nonini (2005) for example uses the term clique to communicate the notion that everyone involved and benefiting from those relations is part of a highly exclusive community of actors with privileged policy-making access. In the Bulgarian case, these are the civil servants, party factions and their insider groups that form one such elite clique. Third, (3) the purpose of the cooperation within this community or elite is the accumulation of wealth, where, policy-making appears to be a by-product of the need to gain and maintain political access. Therefore, another characteristic of oligarchy is the logic of conversion of political access to economic capital. We already noted earlier in the present paper that the underlying logic of the expanded parentela is the conversion of power into capital, and vice versa. Finally, (4) there is the element of coercion. In its attempt to maintain its market and political positioning, the clique, or parente will use their access to state agencies in order to harm their immediate rivals or other undesirables. This feature is clearly evident in the Bulgarian case, and strongly suggested in the accounts provided by Briody (2003) above. So the question now is to what extent can we find the same four features in other works dedicated to oligarchy. The overlap above though striking is not enough. If the extended parentela offers one explanation to how oligarchic regimes work, then the features of its dynamics should be evident in theoretical works on oligarchy. In the following paragraphs, the single digits in brackets will act as references to each of the four descriptors of oligarchy noted immediately above. In an article that is explicitly devoted to clarifying the definition of oligarchy, Payne defines the term as a combination of two sets of properties. First in terms types of groups with highly exclusive membership (2) (1968: 440): A.     individuals of greatest prestige (suitably determined); B.     identified families; C.   individuals of greatest wealth (suitably determined); D. employers (determined by size of firm or by number of work-ers, and so on);

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E.      landowners (determined by size of holding or by interest group membership, and so on); F.   the armed forces (or specified parts); G.   the Catholic church (or specified parts); H. the holders of high political office at a given moment. (p. 440)

And then, in terms of the power dynamic that they deploy in order to achieve their interests (1968: 441): I.                     power as the extended tenure of political office; II.           power as the ability to prevail against other members of society on selected issues; III. power as the ability to control opinion so that other members of society do not oppose the group’s position; IV.     (an attribute that, as argued below, embodies a fallacy) power as a group’s presumed ability to cause any state of affairs from which it benefits. (p. 441)

Seen in this light both Briody’s iron triangle (i.e. the Carlyle Group) and the Bulgarian extended parentela fit in the above framework. The extended parentela in particular could be coded as the combination of BCH: I, IV. We would also include the highly contested point IV, because the Bulgarian circles (as a pop version of the parentela) certainly are perceived as omnipotent, although that may not necessarily be the case. The code I is seen as relevant, because it is the political office that facilitates the control of the agencies that determine the outcome of public tenders. In fact the extended parentela entirely depends on the political control over the civil service, which alone reflects the idea that an oligarchy extends to political office. Code B reflects the position of some of the respondents of the Bulgarian study state that there indeed are distinguished Bulgarian families that always enjoy effective access to policy-making regardless of the party in power (below). Code C denotes that oligarchs were frequently reported by interviewees as partners of the party in power. In a similar fashion, the Carlyle Group could be coded as BCH and F, for Carlyle’s focus are military contracts (Briody 2003). And then: codes (I) because that group’s control, too, rests on exploiting formal political authority over the civil service; (IV) because it also creates the impression of omnipotence, and (II) because through stovepiping, the group managed to overcome any opposition to the Iraq invasion.

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In short Payne’s idea of oligarchy is about a limited and an exclusive community whose members are engaged in wealth accumulation and its preservation by converting their party political access to policy-making, as opposed to be genuinely invested in policy-making (1968: 447). Probably, the coercive property that we associated between the parentela and the Carlyle Group is missing or underdeveloped in his analysis but certainly not contradicting the overall oligarchic dynamic as we shall review later in the chapter. The idea of wealth and power accumulation of an elite for the sake of its own advancement, and not for the improvement of legislation appears to be a popular feature of oligarchy. Winters and Page (2009) strictly adopt Aristotle’s intended meaning of the term oligarchy, that it is the rule of the richest members of society who happen to be the fewest (2009: 732). In their review of some of the more rigorous quantitative studies on US oligarchy they cover most of the crucial features of oligarchy described earlier. Again, oligarchy is about the conversion of political power into wealth, followed by its accumulation and protection (3—referring to one of the four points characterizing here an oligarchic status quo) (2009: 731, 732): We argue that the concept of oligarchy properly refers to a specific kind of minority power that is fundamentally material in character. In the US context, as elsewhere, the central question is whether and how the wealthiest citizens deploy unique and concentrated power resources to defend their unique minority interests. In the United States (as elsewhere), to the extent that such minority power is exercised, the political system can be considered an oligarchy. (p. 731) […] That is, highly concentrated material wealth generally brings with it both enormous political power and the motivation to use that power in order to win certain kinds of political-economic outcomes. Possession of great wealth defines membership in an oligarchy, provides the means to exert oligarchic power, and provides the incentives to use that power for the core political objective of wealth defense. (p. 732)

As their research reveals, the US oligarchy is locked in the successful attempts of business interest groups to procure favorable legislation that benefits the richest members of American society, namely: international economic policy (2009: 738), monetary policy (2009: 739) tax policy (2009: 739). While the authors do not primarily focus on the partygroup relations, it is impossible to imagine the success in these three

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policy areas without the cooperation of active politicians. (1) Moreover, the exclusive community of the rich or oligarchs is clearly identifiable in the gross income inequality and the political power they wield when their income is converted into a measurement of power (2) (Winters and Page 2009: 733–737). Winters and Page (2009: 736–737) conclude that the top 1 percent of households are in the position to overpower 90% of US citizenry. Moreover, even if a more conservative estimate is employed, when the research of Kopczuk and Saez (in Winters and Page 2009: 737) is brought to the fore, the results are even more staggering: The Individual Material power Index indicates that each of the top 400 or so richest Americans had on average about 22 000 times the political power of the average member of the bottom 90 percent, and each of the top 100 or so had nearly 60,000 times as much. […] This might be enough to get their way, on selected issues, even if the entire bottom 90 percent of the citizenry disagreed- particularly if the rest of the top 10 percent were neutral or allied with the Forbes 400. (Winters and Page 2009: 737)

Quite clearly, then, save for our point 4 of our characteristics of oligarchy, the Winters and Page study (2009) overlaps with the extended parentela dynamic: an exclusive community, comprising political parties and private groups that is preoccupied with policies that either generate more or protect already existing wealth for the richest members of US society. These results were later corroborated by the Gilens and Page study on the extent to which interest groups, median-income voters and 90th percentile income voters are able to influence policy-making (2014). The results are a resounding win for strictly business-related interest groups, as opposed to their mass-based counterparts (2014: 565, 574). It is also surprising that the meaning of oligarchy in the context of US politics has not traveled much since the 1930s from its formulation as the exploitation of public office. And it is as if Mallet-Prevost (1933: 163) refers to the parentela and the award of public tenders when he describes it as a practice: “to secure for its members the spoils of office and the benefits resulting from the control of governmental operations.” In other words, in his implied party-group cooperation, the underlying oligarchic logic is that of conversion of access to capital (3). But he then becomes more explicit in stating that the oligarchy is primarily about the

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relationship between business groups and political parties (1, 2), with business ultimately trying to monetize its policy-making access (3): It is well known to all that behind the machinery of government […] there is another group that in fact controls. That group selects the persons who constitute the visible government; and it exerts a determining influence upon governmental acts. (163) […] They are men powerful in financial and industrial circles who, recognizing the usefulness and the cupidity of professional politicians, make use of them for own selfish purposes, and secure legislative and executive favours denied to the ordinary citizen. (164)

As with the extended parentela, in Mallet-Prevost’s conception, the core oligarchic dynamic rests on the ruling party and its insider group. In this is exclusive relationship, both actors are united in their combined exploitation of the civil service for personal enrichment. As with the extended parentela, it is notable that the success of any such pursuits exclusively relies on patronage (appointments or otherwise) and party’s control of the bureaucracy: ‘there is another group that in fact controls. That group selects the persons who constitute the visible government’. The ultimate purpose of this party-group relationship is to ensure the continued policy-making access and enrichment of the elite: “make use of them for own selfish purposes, and secure legislative and executive favours denied to the ordinary citizen”. No such favors would be possible without significant political control over the respective agency or branch of power. In short, we have again the same configuration of the parente elite: party, insiders and facilitating civil servants. Furthermore, due to space limitations we will only mention a number of other authors writing on oligarchy, this time on Russia who also adopt the above four points. For example, they agree that an oligarchy is the policy-making arrangement, where policy-making discretion is disproportionately vested in a limited number of extremely rich individuals (and/ or their representatives) (1, 2), who are not representative of the wider democratic polity and by an extension are interested in the protection of their wealth (if not its multiplication) (3) (Barker 2013: 559–561; Zudin 2000; Shlapentokh 2004; Fishkin and Forbath 2014; Shinar 2015; Jacobs 2010; Braguinsky 2009). By this time one might have noticed that none of the authors US or Russian oligarchy, except Nonini, has explicitly highlighted the coercive side of oligarchy. That gives the impression that somehow the chapter

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forcefully argues for the existence of such a dimension but that would be incorrect. In her exhaustive theoretical assessment of oligarchy, Leach (2005) insists that an oligarchic rule is characterized by informal exertion of non-public, i.e. illegitimate power through manipulation and coercion (4) (2005: 322–324, Table 1, p. 323, and particularly the definition of oligarchy on p. 329). Her definition of oligarchy offers another considerable overlap with the extended parentela, particularly as it rests on illegitimate, manipulative coercion (think prejudiced regulation) as the primary trait of an oligarchy: * oligarchy, then, is a concentration of entrenched illegitimate authority and/or influence in the hands of a minority, such that de facto what that minority wants is generally what comes to pass, even when it goes against the wishes (whether actively or passively expressed) of the majority. To put this in terms of the categories in the matrix: * Authority becomes coercive when it becomes illegitimate, i.e., when leaders exceed the scope of delegated authority and/or resort to illegitimate means of exercising formal or informal power (coercion or manipulation) to squelch dissent. * coercion becomes oligarchic when the illegitimate means of exerting formal power become concentrated in the hands of a minority to the degree that that minority can regularly achieve its intended ends against the will of the majority. * influence becomes manipulative when it becomes illegitimate, i.e., when leaders exceed the scope of informal power implied by group norms. They can do this by usurping decision-making authority and/or using illegitimate means (coercion or manipulation) to affect decisions. * Manipulation becomes oligarchic when the illegitimate means of exerting informal power become concentrated in the hands of a minority to the degree that that minority can regularly achieve its intended ends even though a majority would like to oppose them.

In her definition of oligarchy above we can clearly identify type two parentela used to suppress political opposition, ‘when leaders exceed the scope of elevated authority […] to squelch dissent.’ This also allows us to include type two parentela (or PRIs) as another type of political coercion in the sense implied above. The case of party’s intervention in the civil service in the interest of the insider using political appointments is the core dynamic in the extended parentela, and it fits the dynamics Leach refers to in the paragraphs on illegitimate influence and oligarchic

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manipulation above. The case of public tenders shows how it is through the use of political appointees the parente can influence the decisions of the committees considering procurement bids. In doing so, the parente usurps and manipulates the process of public tender distribution, against the interests of all other participants. In this section, we argued that the extended parentela dynamic is oligarchic. To do so, we described the parentela and compared it to one of the more famous US cases on oligarchy and secondary theoretical literature on oligarchy. The extended parentela models an oligarchic dynamic because it contains the four elements that characterize the latter (1) close party-group cooperation; (2) formation of an exclusive community; (3) policy-access for the purpose of its conversion into capital and (4) elements of coercion. Again, the extended parentela does not offer a comprehensive explanation how all oligarchies work, but rather one form of oligarchic mechanics. Further along the lines of presenting how the extended parentela works, the following chapter, in turn, will look at the overall causal dynamics that the extended parentela finds itself in.

Causes for the Extended Parentela In the preceding sections we described the extended parentela as a model of oligarchic state-group relations. In doing so, we also paid particular attention to its main features: competition between elites, centrality of political parties and general behavior consistent with the literature on oligarchy. This section will add a few words on the present and future causal relations the extended parentela finds itself in. In terms of independent variables responsible for the extended parentela formation, the initial study identified the intersection of the interests of the party in power and private groups (Petkov 2016). The existence of political appointments acts merely as an intervening, catalytic variable. From the side of the private group, it is the desire to gain better market standing that drives it to closer contacts with the ruling party. In the case of the Bulgarian construction sector as of 2015, that may be caused by the decline of the construction sector, which in turn forces construction firms to seek closer party connections. But then again, we do not need a formal reason why. Simply some market actors may seek other means to beat their competition—in this case by taking the party route. Why political parties would enter parentela relations, then? As Chapter 2 highlighted the costs of political campaigns are exorbitant

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and political parties are constantly starved out for funds. This drives them to seek out private actors who would be willing to become party contributors and as one would have it sectoral trade associations do not appear suitable. Groups of private companies and/or individuals of considerable wealth may appear a better suited partner. Thus the exchange-cooperative relationship is born: against advantageous administrative and policy-making access, the party insider group will finance party’s campaigns. An extended parentela could emerge also because either the insider or the party, or both, are interested in the suppression of policy dissent. That usually comes as a reaction to outsider groups who disagree with the policies promulgated by the parente, or internal party factions that, too, may be opposing the current party leadership. It also may be the case that the party itself might initiate type two parentela dynamics against the businesses of its political opponents. Overall, at this stage of the research it appears that the parentela is the result of political parties and informal groups (private companies and affluent individuals) willing to convert political access to mutual economic gain (or in theory to tackle political opposition). Each in its own way converts their direct access to the central administration (or policy-making) in some form of economic gain. Chapters 3 and 4 are clear testimony of this conversion, either through by dominating the distribution of public tenders, or through prejudiced inspections where in both cases the private group reciprocates to the ruling party. And here is the place to highlight the study of Chalakov et al. (2008), who researched the network structure of Bulgarian elites in the period shortly before and immediately after the regime change in Bulgaria. With the network which they labeled molecule of conversion, Chalakov et al. (2008) sought to model the process where the waning access, which the retiring communist elite still had, was actively being converted into capital by setting up the very first companies, firms and corporations which were some of the first recipients of the newly privatized state property. While the present study does not give credence to the continued existence of the molecule, it is evident that molecule’s logic of conversion is at the very roots of the extended parentela formation. One might argue that the extended parentela is the molecule transformed. In any case, there is one last question that remains: what does the future hold for the extended parentela? Will we observe a transition from

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consolidated democracy and interest group pluralism to a consolidated oligarchic regime?

Oligarchic Consolidation: A Hypothesis The answer to these questions rests on the extent to which Bulgarian political system will sustain meaningful and effective competition among political parties. Right now, parliamentary elections have suppressed the consolidation of an elitist status quo by rekindling the elitist competition. As we saw above an elite competition is party competition, because political party coming down from power means the demise of the elite that has formed with it. First its appointees will be swept out of the civil service, while the businesses of the party insiders could be subjected to retaliatory regulatory inspections. The forms of pressure exercised by one elite are reenacted by the one that succeeds it. This raises the question, then, how is an oligarchic status quo possible in the presence of parliamentary elections and democratic institutions? The quick answer is by removing the competitive element from political elections. Broad grand coalitions and a party system dominated by a single party will effectively consolidate the competing elites in a single oligarchic status quo. This is so because both of these eventualities force the merger of competing elites in a single community: either because political parties have decided to rule together in grand coalitions, or simply because there is a single political party that dominates the party system, becoming thereby the only party that provides effective access to policy-making. This view, then, is behind the hypothesis that the present book would like to advance namely that: limiting party competition in the context of unimpeded extended parentela relations will lead to oligarchic consolidation. The term oligarchic consolidation here denotes a status quo where the incumbent dominant party or grand coalition along with their insiders and civil service appointees form a distinct and self-aware community of those with privileged policy-making access. The notion of oligarchic consolidation rests on the very same four characteristics developed in previous sections. The distinction here between oligarchic dynamics of the extended parentela and the consolidated oligarchic status quo merely rests on the absence of competition among the parente elites in the latter

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case. If competing parente elites using coercion and expansion are characteristic of the extended parentela, then they would continue to use those levers in an oligarchic status quo, but this time against non-elite actors who would not have a realistic prospect of independently gaining political representation (access). In short, we can look at the consolidated oligarchy as a stage before formal oligarchy and as a stage after the extended parentela. If formal oligarchy is the improbable status quo where the actual institutional setup is explicitly geared towards oligarchic rule, then consolidated oligarchy status quo is the stage where the oligarchic elites are consolidated but operate informally or embedded in the democratic structures. The extended parentela, then, is the dynamic stage where oligarchic elites are in constant competition. So, again, it is hypothesized here that the dynamics of the extended parentela relations can transform into a consolidated oligarchy, if the extended parentela continues unimpeded and the inter-party competition is diminished. In other words, the transition from elite competition to consolidated oligarchy status quo first begins by the elimination of the business elites, following the logic of the extended parentela. More specifically, we would further hypothesize that there indeed will be a decrease of the number of business actors, and that will be paralleled with an increase of the wealth of those who survive these parentela pressures. The case on public tenders and prejudiced inspections suggest that the elite competition is similar to a zero-sum game. A signed contract with the state for one actor is a missed profit for another. This is exacerbated when competitors in the construction sector for example are dependent on public tenders for their survival. Moreover, the expansion of one’s market share through administrative harassment can only be at the expense of the market shares of another. In fact, the logic of the extended parentela dynamics might suggest at first sight that some balance is achieved with the change of political parties, namely, that later insiders will be able to fully eradicate the business benefits and advantages accrued by the previous insiders. The logic of type two parentela seems to suggest that there is a balance or parity between current and former elites when they target each other, once in power. However, one cannot expect such complete checks and balances. Respondents shared the view that it is in party insider’s interest to maintain good relations with all parties with government-forming potential

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(Petkov 2016). Why work with only one party? Others reported the now defunct Multigroup Corporation and a few other popular oligarchic names as examples of individuals who are doing well regardless of the party in power. Another respondent used the term families as a reference to a generic actor that can afford cooperating with any political party. In ideal circumstances, private actors would engage with all possible political parties, if possible. However, as the elitist competition among informal groups is an incomplete zero-sum game we can expect that under the continued influences of the extended parentela some business actors will perish at the expense of others. The few actors who survive will also have the most resources. They will have disproportionate wealth and market share compared to the rest of the players. In any case, this tendency of decreasing business elites could not go forever. At a future point the handful of private actors in a given sector, eligible to partner political parties, will find it impractical to compete among each other and begin acting as a monolithic bloc, which will directly bargain with the party in power. It is this culling of prospective private actors eligible to cooperate with political parties that will dampen the pulse of elite competition on the one hand and initiate the process of elite consolidation. In that situation, regardless of whichever party is in power, that party will be faced with the prospect to cooperate with the same handful of private actors. This scenario renders parliamentary elections as an ineffective mechanism to remove economic elites from power, because every political party in power will be left to partner with them. This brings question How political parties would react in this situation: consolidate with that private elite or fight it?, but this is a matter of another debate. The other independent variable that is hypothesized to contribute to oligarchic consolidation is party system change. What will happen, then, if party competition is stifled? In the context of limited inter-party competition, the extended parentela dynamics will lead to some form of oligarchic consolidation as the number of government-forming parties declines, because this also means that elite-forming partners (parties) for the private groups will decrease. The presence of a single, predominant political party, i.e., one that has won Parliamentary elections at least four consecutive times with absolute majority (Sartori 1976: location 4579–4595; Mair 1997: 53, 203), means that there will be no rivals to the oligarchic elite that would have formed with it. That is, with the continued extended parentela dynamics, any outsider private actors will face

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the choice to either merge with the predominant party or face extinction, as no other political party would have government-forming potential. Note that a change to a predominant party system is entirely within the scope of a democratic government. The same scenario is also possible in the case of the extreme opposite status quo, that of a consociational democracy and grand coalitions. In that scenario the coming together of all political parties into one will also force their insiders to achieve some degree of mutual compromise and merge, or be eliminated under the unchecked forces of the extended parentela. This is the other hypothetical route to oligarchic consolidation based on a limited party-parliamentary competition well-within democratic institutions. Time will tell which scenario will fit Bulgarian realities. Finally, there is also the possibility of type two parentela relations to suppress inter-party competition. We observed earlier how the parente can attack businesses that are members of interest groups which oppose ruling party’s policies. The same, we proposed, could be applied to donors of rival political parties. Therefore, the coercive arm of the extended parentela theoretically could affect the intensity of inter-party competition. At this point some may have noticed some methodological tension on how to conceptualize the causal variable extended parentela and the effect consolidated oligarchy. The tension is whether these terms are conceptually discrete because both of them are models of state-group relations and both of them share the four points that characterize oligarchy derived earlier. The distinction is that of dynamics and statics. The causal relationship here is about the transformtion of the extended parentela from a dynamic model into a static one of state-group relations. We could have just as well labeled the dependent variable extended parentela prim, but that would cause additional confusion. Theoretically there should be more than one way to reach an oligarchic status quo. The extended parentela (in combination with diminished inter-party competition) then is seen here as one of many processes that could possibly lead precisely to a consolidated status quo. But in any case, what this study stands for is that regardless of how a consolidated oligarchy is reached, it will bear the four characteristics derived earlier: it is coercive, party-centric, elite community-forming and access-exploitative (conversion). The future verification of this hypothetical causal relationship would simply mean that under certain conditions the initial parentela derived by La

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Palombara does have the potential to form an oligarchic status quo and the above hypothesis is the process to do it. The final question that stems from all of the above analysis is whether the proposed causal relationship is valid? Are there any other political contexts that would validate these models and hypothesized end status quo? Yes, we have derived these models from both empirical and theoretical literature, but can we re-apply them back to the real world? And would, then, the hypothesis based on them have any relevance and justification for its declaration? Again, the short answer is yes. The next chapter is entirely dedicated to the applicability of the extended parentela and consolidated oligarchy to the real world.

Conclusion In this chapter we pieced together all of the elements of the extended parentela uncovered in previous chapters in a single coherent model of the oligarchic relations currently active in Bulgaria. As the importance of the present chapter was to integrate the material from a few chapters back, it began again by revisiting the initial impetus for the project and how that differs from the current objective of the present book. That is why we began by—again—recapping previous research into the subject and the starting research objectives behind the Bulgarian Parentela Study. Namely, while the study was initially entirely motivated to research La Palombara’s parentela policy network and its possible existence and variation in Bulgaria, the richness of the data in fact allows us to address another question, that La Palombara too confronted during his study—the relationship between the parentela and oligarchy. There were two strong indicators of oligarchic dynamics which were registered in the study. The first of them is the formation of what would appear to be party-centric elites. Again, Barnes (2007) is among the first authors to suggest that Bulgarian politics is subject to the takeover of an array of changing oligarchic elites which the present study, in turn, confirms. At the core of this oligarchic dynamic lie the ruling party and its party insider, which are seen here as the unit of the (oligarchic) elite, i.e. the parente. Political patronage over the civil service enables the parente to engage in both of its institutional embedding and expansion, both of which are at the expense of rival counterparts or neutral businesses. Embedding is best observed with the practice of political appointments

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in the civil service, while expansion is best observed with the practice of prejudiced regulatory inspections. The former practice blocks any attempts by outsiders to gain access or benefits from the civil service, while the latter is a mechanism of direct coercion against rivals. Secondly, an oligarchy implies some degree of centralization of power by the elite group. An oligarchic order by definition cannot function in an environment of checks and balances or in the presence of actors outside the elite clique with effective access to policy-making. Such centralization proclivities are already evident in the Bulgarian Executive. As demonstrated earlier, the case of the NCTC is a clear example of the capabilities of a ruling party to control the process of consultation with interest groups in the civil service. In effect, administrative reforms allow ruling parties to control which interest groups have access to policy-making, which is a mechanism intended to prevent effective group opposition. But more importantly, the present chapter added the position which a number of elite respondents shared, namely, that too much power is vested in the Bulgarian executive. The analysis agrees with this view, but for other reasons. Bulgarian parties overpower any form of internal and external dissent not because they or the Prime Minister are too much vested with political power, but because they are the only route to redress policy grievances. This is so, because parties are capable of suppressing dissent from the civil service and their own rank-and-file: 1) either by type 2 parentela harassment, 2) by political patronage in the civil service and 3) by civil service reforms. That the extended parentela model is oligarchic is evident when looking at the respective literature on oligarchy, where we find four core overlaps. First, an oligarchic order is party-centric, because access is not won by force, as commonly thought but gained through the permission and cooperation of the party political elite. Second, an oligarchic behavior is geared toward conversion of access into capital, and not necessarily to improve legislation. Third, an oligarchic behavior is coercive as the elite in power is seeking to secure its positions. Last, an oligarchic behavior forms a community identity of “the privileged”. Consciously or not, the successful reiteration of the extended parentela creates trust between the actors, which in the long-term delineates a sort of a community. Such a community was reported by the Bulgarian respondents and identified by Briody earlier in the oligarchic literature. Finally, the chapter offers the hypothesis that the unimpeded reiteration of the extended parentela, in combination with a diminished

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competition between political parties will lead to a change of the status quo to an informal oligarchic regime. Again, it is informal because it is envisaged here that an oligarchic order can function under a democratic institutional framework. A diminished inter-party competition, on the other hand, can come in two shapes: either a party-change to the predominant type, where a single party continuously wins absolute majority at parliamentary elections, or political parties decide to pursue politics of grand coalitions and conscocialism. All of this analysis begs the question, whether the thus derived model has further validity, as well as whether its hypotheses are justified? Those are addressed in the following chapter, where we apply the model and its hypothesis to the Ukrainian realities during the tenure of President Kuchma.

References Barker, D. W. M. (2013). Oligarchy or Elite Democracy? Aristotle and Modern Representative Government. New Political Science, 35(4), 547–566. Barnes, A. (2007). Extricating the State: The Move to Competitive Capture in Post-communist Bulgaria. Europe-Asia Studies, 59(1), 71–95. Braguinsky, S. (2009). Postcommunist Oligarchs in Russia: Quantitative Analysis. Journal of Law and Economics, 52(2), 307–349. Briody, D. (2003). The Iron Triangle: Inside the Secret World of the Carlyle Group. Hoboken: Wiley. Chalakov, I., Bundzhulov, A., Hristov, I., Deyanova, L., Nikolova, N., Deyanov, D., et al. (2008). The Networks of Transition—What Actually Happened in Bulgaria After 1989? Sofia: East-West [Чaлъкoв, Ив., Бyнджyлoв, A., Xpиcтoв, И., Дeянoвa, Л., Hикoлoвa, H., Дeянoв, Д., Mитeв, T., Cлaвeнкoв, Б., Cимeoнoв, O., Чипeв, П., Cтoйнeв, B., Фeлиcи, Cт. (2008). Mpeжитe нa пpexoдa – Кaквo ce cлyчи вcъщнocт в Бългapия cлeд 1989. Coфия: Изтoк-Зaпaд]. Compston, H. (2009). Policy Networks and Policy Change: Putting Policy Network Theory to the Test. Basingstoke: Palgrave-Macmillan. Fishkin, J., & Forbath, W. E. (2014). Panel II: Is the Constitution Responsible for Electoral Dysfunction? The Anti-Oligarchy Constitution. Boston Univeristy Law Review, 94, 669. Ganev, V. (2001). The Dorian Gray Effect: Winners as State Breakers in Postcommunism. Communist and Postcommunist Studies, 34, 1–25. Gilens, M., & Page, B. I. (2014). Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens. Perspectives on Politics, 12, 564–581. Greer, A. (1994). Policy Networks and State-Farmer Relations in Northern Ireland, 1921–72. Political Studies, 42(3), 396–412.

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Jacobs, L. (2010). Democracy and Capitalism: Structure, Agency and Organized Combat. Politics & Society, 38(2), 243–254. La Palombara, J. (1964). Interest Groups in Italian Politics. Princeton University Press: Princeton. Leach, D. K. (2005). The Iron Law of What Again? Conceptualizing Oligarchy Across Organizational Forms. Sociological Theory, 23(3), 312–337. Mair, P. (1997). Party System Change. Oxford: Oxford University Press. Mallet-Prevost, S. (1933). United States-Democracy or Oligarchy? The Annals of the American Academy of Political and Social Science, 169, 159–171. Nonini, D. M. (2005). Making the Case for Kleptocratic Oligarchy (As the Dominant Form of Rule in the United States). Social Analysis: The International Journal of Social and Cultural Practice, 49(1), 177–189. Payne, J. (1968). The Oligarchy Muddle. World Politics, 20(3), 439–453. Petkov, M. (2016). Validity and Variation in the Parentela Policy Network. Dissertation, University of Edinburgh, Edinburgh. https://www. researchgate.net/publication/317230743_Validity_and_Variation_in_ the_Parentela_Policy_Network_Conflict_and_Cooperation_between_Ruling_ Parties_and_Interest_Groups_in_Bulgaria. Last accessed 31 May 2018. https://doi.org/10.13140/rg.2.2.21329.33120. Petkov, M. (2017). The Parentela in Bulgarian Polity: Conflict and Cooperation Between Groups and the State. Bulgarian Studies, 1, 37–59. Sartori, G. (2005 [1976]). Parties and Party Systems: A Framework for Analysis (Kindle Edition). Colchester; Lanham, MD: ECPR Press Classics; Rowman & Littlefield International. Shinar, C. (2015). The Russian Oligarchs, from Yeltsin to Putin. European Review, 23(4), 583–596. Shlapentokh, V. (2004). Wealth Versus Political Power: The Russian Case. Communist and Post-communist Studies, 37, 135–160. Winters, J. A., & Page, B. I. (2009). Oligarchy in the United States? Perspectives on Politics, 7(4), 731–751. Zudin, A. (2000). Oligarchy as a Political Problem of Russian Postcommunism. Russian Social Science Review, 41(6), 4–33.

CHAPTER 6

Ukraine Under Kuchma—An Illustration of the Link Between the Extended Parentela and Consolidated Oligarchy

In the previous chapter we constructed the model of oligarchic party– group relations in Bulgaria and ended with the hypothesis that if left unobstructed, the extended parentela dynamics in combination with a decrease of the inter-party competition will lead to a status quo of a consolidated oligarchy. ‘But how much of the above is valid, and can it be applied back to the real world?’, the previous chapter asked at its very end. The answer to these questions is in the Ukrainian case in the present chapter on the tenure of the Ukrainian President Leonid Kuchma (1994–2005) as an example of the extended parentela and consolidated oligarchy in a polity outside Bulgaria. Ukraine was selected primarily based on its media exposure which often refered to the so-called Ukrainian oligarchs. If media outlets report an abundance of oligarchs, then its internal dynamics should also carry oligarchic traits. This exercise is entirely illustrative, which is why only secondary data on Ukraine is used—i.e. it relies on the studies and observations of area experts. Moreover, Ukraine is preferred here over other candidates, such as Russia, which also features an abundance of oligarchs for a few reasons, first of which is the broadening of the comparative scope in the literature. Russia at present dominates the field as a test subject. Second, there are very strong authoritarian tendencies in the Russian state and it seems that the absence of inter-elite competition is rather the result of a single coercive party-center, forcing oligarchic elites into cooperation, as opposed to a status quo defined by the party-group elite that has survived the free-for-all iterations of © The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3_6

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the extended parentela following each Parliamentary election. But that itself is matter of a separate study. But let us now briefly recap the basics of the party-group model of oligarchic relations. The oligarchic party–group dynamic, developed in the previous chapter, is a model comprising the interplay of the extended parentela and Parliamentary elections. If the former refers to the two parentela types combined, then the latter refers to the shocks Parliamentary elections exert on those relations. The successful reiteration of party-group cooperation instances creates trust which binds the actors in a single elite unit which pursues its own political and economic goals. Because such elites are formed on the basis of parties’ control over the civil service, the change from one party in power to another is a change of the incumbent elite. Parliamentary elections, therefore, followed by a party change in effect perpetuate the competition between Bulgarian elites. A small detail is probably worth mentioning here regarding the nature of the party insider. The oligarchic dynamic here does not require that the party-insider be a formal interest group, a Trade Association, for example, as was the case in the parentela in Italy and Northern Ireland. Thus, companies, firms and/or oligarchs are part of the definition of party insider. The model simply states that the merger between the ruling party and such informal insiders forms the parente or the elite core. The model also does not presuppose a continued cooperation between a party and the informal insider group. There is nothing stopping an informal group trying to appeal to any parties with government-forming potential, if any. Based on the above, therefore, Chapter 5 hypothesized that the unobstructed dynamics of the extended parentela combined with a dampening of the inter-party political competition will cause the extended parentela to consolidate into an oligarchic state-group status quo, while still embedded in the democratic framework. This hypothesis, however, first brings up the question of what is meant by consolidated oligarchy in this study? As explained earlier, this is a political status quo which has forced political and economic elites to merge into a single coherent community with close to no outside rivalry. As we will discuss later in this chapter, this concept is contested particularly by pluralism or biased pluralism, and to a lesser degree by competitive authoritarianism and neo-patrimonialism. The latter two have been used in the transitological literature to describe

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and qualify the incumbency of president Leonid Kuchma in Ukraine. It suffices to say at this stage that a consolidated oligarchic status quo differs from biased pluralism on four counts: it is party-centric, it has coercive element, it is focused on the short-term conversion of access to capital and finally, unlike pluralism, oligarchic dynamics primarily engage informal groups comprising affluent corporations and/ or individuals who do not represent wider sectors of the economy or society. On the basis of the extended parentela dynamics, the previous chapter stated hypothesis H1, where: the continued iterations of the extended parentela dynamics and a decrease of the inter-party competition will transform the extended parentela into a consolidated oligarchy status quo. However, in order to discuss the hypothesis in the current chapter, we will restate it as two hypotheses. This is motivated by the fact that if the parente has a political and a business half and if a consolidated oligarchy is the extended parentela minus interelite competition, then the process of dampening of political competition is paralleled by a similar process of dampening business-elite competition. Therefore, the process of the decrease of business elite competition is expressed in Hypothesis 1a: Hypothesis 1a The idea of consolidated oligarchy states that there is a considerably low number of affluent business actors who outperform their market competition. That is to say, there is a decrease of the competition among the business actors in a given sector who can enter parentela relations. These business elites are affluent actors whose wealth has the potential to affect the economy of the state. This may include (near-)monopolists or a number of corporations whose business operations are of such scale that they are in the position to influence the economy of the state. Hypothesis 1a states then that the reiteration of the extended parentela will both decrease the number of market participants (who can partner parties in a parentela) and increase their potential impact on the economy (or “wealth”, crudely put). The reasoning behind Hypothesis 1a is that the extended parentela relations are imperfect zero-sum dynamics. Although advances of one elite can be at the expense of another, this process is not perfect.

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As we have mentioned in previous chapters there is a number of oligarchs whose humble beginnings are in the distant 1990s and they have survived. The reiteration of this practice, the hypothesis states, will lead both the decrease of market actors and simultaneously their size. In other words, each economic sector will feature a monopolist or oligopoly. Hypothesis 1b  The second part of the hypothesis refers to the nature of the political competition. A consolidated oligarchy is a status quo where there is no effective competition among political parties. We stated earlier that possible examples of a party system that is conducive to a consolidated oligarchy is one where parties engage in grand coalitions and consociationalist policy-making style, or where we have a predominant party system. Finally, as we mentioned earlier, PRIs can be instigated against any businesses which are politically opposing the ruling party. This too can have an effect that diminishes inter-party competition, if PRIs are focused on the businesses that support them. However, the Bulgarian Parentela Study did not find direct evidence of that, other than to suggest that it is theoretically plausible. Therefore, Hypothesis 1b states that a predominant party system, a consociationalist government style, or second parentela dynamics decrease inter-party competition. In the following sections, we will observe the extent to which Ukraine during Kuchma’s tenure conformed to the elements of the extended parentela and oligarchy. The following section will look at the basic parentela relations of type one, while the following one will look at type two. The third section will, then look at the extent of oligarchic traits that could be found in his tenure, following the four oligarchic markers derived from the previous chapter. The second half of the chapter is dedicated to advancing the term consolidated oligarchy as another—discrete—qualifier of Kuchma’s regime, which specifically looks at the state-group relations. In doing so, the logic of comparison, however, obliges us to address another much more similar concept, namely, biased pluralism (or simply pluralism) in an attempt to clearly define and delineate the boundaries of consolidate oligarchy.

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Basic Parentela Relations in Ukraine In the present section, we will address Hypothesis 1a, which essentially rested on the idea of prejudiced regulatory inspections and that the extended parentela as a whole is a dynamic which effectively eliminates business elites, because the parente in power seeks to eliminate their business competition. Hypothesis 1b will be discussed in the next section. Some of the most important analyses on Ukraine during Kuchma’s tenure are provided by Puglisi (2003) and Aslund (2003) who are explicitly interested in tracing the relationship between Ukraine’s richest and the President. Their work deserves special attention as the picture they develop clearly fits the parentela in its basic form of a close cooperative relationship between the Executive and an informal business group. In a direct reflection of the general definition of the parentela, Puglisi argues that the economic success of some firms during Ukraine’s process of privatization of state assets was due to their proximity to the Executive (2003: 103): Economic liberalization has been pushed only as far as allowing the privatization of state assets, but not the correction of market distortions. The ‘selected introduction of market mechanisms’ and the consequent generation of concentrated rents has prompted a small group of actors, net winners under these conditions, to lobby for the preservation of this newly achieved status quo.

Moreover, Puglisi clarifies that Kuchma’s tenure and its success rested on the patchwork of alliances with otherwise rival oligarchic groupings, or clans, by exploiting and exchanging the resources available to him under his institution (2003: 103). The close party insider group cooperation in Ukraine quite explicitly followed the contours of the parentela, as directors and executives of affluent companies received political representation using political appointments, which is a core parentela dynamic (Puglisi 2003: 107–108). More specifically, Puglisi provides the example of the so-called Dnipropetrovsk clan—a regional-based grouping of businesses—which were represented in the civil service through nearly 200 appointments vetted by Kuchma (Puglisi 2003: 110–112). Further consistent with the parentela, brightest appointments were future prime minister Valeryi Pustoyvotenko, the secretary of Ukraine’s security and defense council Volodmyr Horbulin or Serhyi Tyhypko

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who was appointed the vice prime minister in charge of the economic reforms (Puglisi 2003: 111). Such relations between Kuchma and the Dnipropetrovsk clan fully overlap with the basic parentela. Furthermore, Aslund, too, sees the Kuchma regime as oligarchic, although not as a stagnant status quo but as a process (2003: 107). In his view it would either transform further into a functioning democracy or a full-fledged dictatorship. The reason for his latter concern, however, is namely Kuchma’s close relations with Ukraine’s oligarchs (Aslund 2003: 108): In November 1999, Kuchma was re-elected thanks to a credible communist threat and heavy financing from the newly minted, billionaire oligarchs, who appeared to have bought the state [… and] proceeded to accumulate still more privileges as the rest of the economy descended […]

Already the general description of the Kuchma regime suggests that the success of said businessmen was thanks to their privileged access to the state. This access was facilitated with the appointment of oligarchs such as Yuschenko (chairman of the Central bank) as a prime minister, Timoshenko (touted gas queen, for her monopolist position in Ukraine’s energy market) as a deputy prime minister (Aslund 2003: 108–109). The description of Kuchma’s regime provided by Aslund and Puglisi above follows the general outlines of the Bulgarian parentela where it is informal groups of affluent business actors that gain privileged access to the civil service. These dynamics eventually lead Puglisi (2003) and Aslund (2003) to explicitly advance the argument that the Kuchma regime is in effect a regime where political and economic elites have consolidated into an oligarchic one. Aslund (2003) and Klein (2012), in other words, emphasize on the competition between Ukraine’s business elites, or clans, whose primary objective was to gain access to the Executive: either by directly negotiating with Kuchma or by taking the longer route to the Executive by forming own Parliamentary faction, with the hope to enter government in the long run. Aslund (2003: 109) for example lists three such competing clans in Ukraine’s Parliament (Aslund 2003: 109–110): First is the Kiev clan, headed by Hryhory Surkis and Viktor Medvedchuk with a monopolist standing in the power utilities sector and are the leaders of the Social Democratic party (SPDU). Second is the Dnepropetrovsk clan, headed by Viktor Pinchuk with a dominant business positioning

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in the steel sector, and leading the Labor Ukraine faction. Last is the Donetsk clan with Rinat Akhmetov as its leader and Viktor Yanukovitch as his deputy. That clan is a large regional aggregation of coal and mining businesses represented by the Regions faction. More specifically, however, Klein argues that it was the very intention of Ukrainian oligarchs, or those who wished to become one, to exploit their access to the civil service through their connections with Kuchma’s presidency by taking political office (Klein 2012: 124–125). Klein (2012: 125) gives an example with the Dnepropetrovsk businessmen with close connections with Kuchma: In addition to the post of prime minister, many other ministerial positions – above all those exercising authority in the economic sector – were divided among the informal regional networks. These networks were also frequently able to gain proximity to the president when their representatives came to be appointed as personal advisers. In that way, not only regional politicians but also the entrepreneurs themselves were able to get a foot in the door.

As we already mentioned earlier, Puglisi (2003: 110–112), too, identified the Dnepropetrovsk clan as the one with insider status with the Kuchma administration. What is more important, however, is that the continued presence of those networks is not only in the civil service but as members of Parliament who were nominated by the oligarchic partners of NDP, primarily the Dnipropetrovsk clan, and which were later included in the party lists (Klein 2012: 129–130). It should be stressed that in light of their, the nomination of MPs from one clan does not violate the logic of the parentela, although strictly speaking the network by definition does not involve the Legislature. Leaving the issue of definition aside for the moment, we will count the inclusion of party insider nominations in the party lists of candidate Members of Parliament as evidence of the parentela, because that is another form of patronage. Instead of a civil servant, the person is appointed as an MP.

Coercion Further in support of Hypotheses 1a and 1b, there is evidence to suggest that administrative coercion was used to decrease political and economic competition. Puglisi (2003), for example, reveals how the Kuchma regime overlaps with the extended parentela on the dimension of coercion.

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Accordingly, Kuchma’s approach to forging his relationships with Ukraine’s affluent business actors also included the elimination of rival economic elites, the code word for which is “ierarkhizatsiya” (Puglisi 2003: 111): The president’s intervention drew a distinction within the business elite and placed on a hierarchy of influence those who were granted access to budget resources, those who enjoyed political connections and those who were altogether banned from the circles of power. 69

In other words, the effects which Kuchma’s insiders intended by supporting him were to benefit from his networks of appointees in the civil service as a way to gain further advantages at the expense of their business competition (Puglisi 2003: 104): The economic elite systematically pushed through measures that would help to preserve their status […] The consequence was the consolidation of a rent-seeking system in which economic advantages were afforded only to those close to the administration, while excluding those who were not part of it.

Note here that Puglisi in fact refers to two processes: one is the process of gradual approximation between the executive and with its insiders, and then the consolidation of this practice into a status quo, e.g. a consolidated oligarchy. Puglisi (2003: 104) implies that those who found themselves as outsiders failed in the overall inter-elite competition. In the same vein Klein’s rendition on the Ukrainian state during Kuchma’s tenure also reveals that the business elites that have party insider status sought to oust their active competition, as was the case with Yulia Tymoshenko, who was pressured towards the periphery by Premier Valerii Pustovoitenko, where: ‘the election of Valerii Pustovoitenko as the next prime minister from Dnipropetrovsk brought down [Tymoshenko’s] business empire’ (Klein 2012: 125). Klein (2012: 128) later re-states the party-centric elite rivalry between Ukraine’s elites, which in turn reflects the extended parentela dynamic: In this context the broader argument would be that since competitive authoritarian regimes revolve around elections, the logical way for opposition forces to gain power in such regimes is to win elections. If the

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opposition can engage in the same kind of manipulations as the ruling elites, the result is just a change in the composition of the ruling elite.

As we will discuss later, competitive authoritarianism is a stage of democratic transition where despite the existence of stable and valid elections, the ruling elite (party) tends to exploit the state resources available through its incumbency to gain campaign advantages. Klein (2012: 128) seems to suggest, therefore, that Ukraine is in a state of perpetual elite rivalry in an environment of competitive authoritarianism where instead of correcting it, rival elites vie for power with the hope of exploiting the opportunities provided by said environment for own gain. The position in this book in relation to the oligarchic dynamics in Bulgaria is the same: political parties are most likely aware of the advantages provided by political patronage and coercion, but instead of rectifying these conditions, they choose to vie at elections with the hope their turn will come one day so they too could take advantage of said opportunities. Thus, in either case, the actors change while the oligarchic dynamics remains the same. Darden (2008) also detected the coercive thread in Kuchma’s tenure, and is much more specific than Klein (2012). On the surface, Kuchma consolidated the more evident state resources of coercion, namely the crowd control gendarme units, such as Alfa and Berkut, which at some point were larger than the army count (Darden 2008: 214). However, there were more tacit and subtle ways of coercion, such as the deliberate enablement of graft by the state, which served two basic purposes (Darden 2008). It, first, induced civil servant’s cooperation with the regime, as graft acted as a second salary. Yet, second, it also provided some incriminating evidence to be used as blackmail by Kuchma against internal political dissenters (2008). That, in essence, is one of the coercive tactics used by Kuchma’s presidency. The graft-ridden civil service during Kuchma’s tenure demonstrates the scope of Kuchma’s control and ability to mobilize the coercive powers of the state to own advantage—and that of the elite associated with him. Darden argues that those were used against any potential internal rivals who deliberately were allowed to accumulate a dossier of malpractice only to be used selectively against them at a later stage (Darden 2008: 47). Consistent with type two parentela, Darden (2008: 49) also argues that the agencies of the state in general were used for coercion against

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political rivals. With the series of secret audio recordings made by Kuchma’s personal bodyguard, Darden (2008: 50) illustrates how Kuchma instructed the head of the Tax Administration Azarov and Leonid Derkatch—the head of the Ukrainian intelligence service to work together and mobilize their agencies to secure votes for the upcoming election. The “mobilization” in this case also included blackmail of opposition and rival political elites on their recorded misconduct. More importantly and in direct overlap with type 2 parentela the tax inspectors were expected to intimidate local administrative and business actors with tax investigations unless they agitate voters for Kuchma. Observers from the Organization for Security and Co-operation in Europe (OSCE) concluded that true to their instructions state civil servants indeed interfered with the elections on the side of Kuchma. Written orders were intercepting detailing how local civil service officials should agitate the electorate for Kuchma, while actual compliance was overseen by the intelligence services. In his review of Kuchma’s regime and cooperative relationship with Ukraine’s oligarchs at the time, Aslund (2003: 108) is far more direct in his exposure of the coercive tactics used against political and business rivals alike. As many respondents from the Bulgarian parentela study have noted, sudden tax investigations by the respective agencies have also been used as a mechanism of coercion by the Kuchma regime (Aslund 2003: 110–111): Kuchma’s first reaction to his miserable election results was to appoint a major oligarch, Viktor Medvedchuk, as his chief of staff. Medvedchuk focused on two tasks. One was to persuade businessmen in Parliament to join the oligarchs. Since most of these businessmen are multi-millionaires, they are not easily bribed, so the regime uses repression instead. Most major businessmen in the opposition have endured raids by the tax police and arrests of their top managers.

Other perceived rivals, such as the media, were subjected to the same tactic of prejudiced regulatory inspections or brought to court (Aslund 2003: 111): Disobedient independent newspapers are sometimes sued for libel and issued prohibitive fines, forcing them into bankruptcy. The government admits that the State Tax Administration inspected no less than 260 media

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outlets in the last year, but merely added insult to injury by complaining about their poor tax morals.

In short, the available evidence provided by Darden (2008), Klein (2012), Puglisi (2003), and Aslund (2003) illustrated two core elements of the extended parentela. The authors demonstrate that Ukrainian oligarchs deliberately sought close party-level contacts with Kuchma in order to exploit the administrative access that he provided to suppress their market competitors, while at the same time, Kuchma used his control over the civil service to suppress any political rivalry.

Consolidated Oligarchy During Kuchma’s Tenure The previous sections started with noting that Kuchma’s coercive practices had an effect of decreasing both political and business competition, which satisfied Hypotheses 1a and 1b. The present section will lend support to Hypothesis 1b. In this case, however, President Kuchma’s behavior demonstrates that it is better theoretically to speak in terms of general political competition. Inter-party competition, as our conception dictated earlier, does not cover all forms of political conflict. President Kuchma sought to preempt political competition, hence opposition, not only by attempting to forge grand coalitions, but also by appealing to the oligarchs for support, and by incorporating key trade associations into the civil service.1 As Puglisi (2003: 113–114) states, Kuchma and his party of Popular democracy (NDP) sought to preempt any political opposition by forming large coalition, with parties that represented big (oligarchic) business. For instance, the party of Regional Revival, the group of Members of Parliament known as Working Ukraine, Social Democratic party and Kiyv Seven were headed or dominated by market monopolists, extremely influential and affluent individuals, or simply, oligarchs (Puglisi 2003: 113–114). However, by appealing to business-centric parties, Kuchma was in effect also appealing to the business elite as a whole. A policy of an expansive coalition was one way of consolidating any political opposition, but as Puglisi (2003: 113–114) emphasizes the actual message 1 The last, by the way, is reminiscent of the NCTC case, where legislative amendments regulating access to NCTC expected top directors to disclose their personal finances, because the trade associations at the NCTC were seen as part of the civil service.

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behind this move was to appeal to the wider spectrum of competing business elites in Parliament, disguised as party factions. Accordingly he announced that all businesses are welcome and that the only viable access to the Executive was through NDP/SDP, headed by Kuchma, which seems to have been well-received. In the same vein, Levitsky and Way (2010: 216–217) explain that Kuchma’s tenure rested on a very broad coalition of ‘oligarchic parties’, such as the party of Regions, Fatherland and the Social Democratic party. Moreover, he also relied heavily on the media comfort provided by supportive oligarchs, such as Medvedchuk, for example, who controlled STB, ICTV and New Channel, and also who headed the Presidential Administration at a later period (Levitsky and May 2010: 217). So, again, in parallel to drawing businesses closer to his institution through the selective award of policy-making privileges, Kuchma also worked towards the dilution of any possible political opposition by attracting any rival parties in a broader coalition. The end result is ultimately a state of oligarchic consolidation, where the political elite, headed by Kuchma, effectively merged with the majority of the business elites competing for access to policy-making, namely that ‘[…] the president and his administration have become instrumental in the rise, stratification and consolidation of the Ukrainian oligarchs’ (Puglisi 2003: 102). Puglisi (2003: 110–111) later reiterates the idea that a consolidated oligarchic status quo is not only a condition of the absence of elite competition but it is is the result of Executive Branch’s interference in the civil service—an idea that directly reflects parentela relations: In the years of the first Kuchma presidency an oligarchic system emerged and consolidated thanks to the special privileges awarded by the president and his administration to the members of his inner circle. The president’s patronage network set relations between political power and business on new foundations. Closeness to the president guaranteed access to the administration, redistribution and utilization of state financial or administrative resources (‘a property nobody knows whom it belongs to’), creating large and unexpected fortunes. As an observer commented, The formula ‘capital forms power’, traditional in all developed market economies has been completely inverted into its opposite – ‘power forms capital’.

Entirely inadvertently, Puglisi links Kuchma’s parentela-like relations with the hypothesized here oligarchic consolidation status quo. The

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relations between Kuchma and the oligarchs also overlap with the view on oligarchy advanced in earlier chapters as a set of party-group relations, which are geared towards the conversion of political access into capital, as opposed to policy-making, and the use of various coercive mechanisms for the elimination of any rival elites from assuming such a privileged positioning. Another, yet indirect, indication of the consolidated oligarchic regime is found in the outsider status of sectoral Trade Associations. We noted earlier that one characteristic of an oligarchic status quo is that those groups in close cooperation with the ruling party do not cater for the interest of the sectors of the economy as a trade association would. This in turn means that a feature of an oligarchic status quo is the emphasis on short term moves by party insiders to convert their privileged policy-making access in capital, as opposed to promulgate policies that would benefit sectors of the economy, which would be a secondary objective. For instance, the interests of Ukrainian sectoral peak associations could not outcompete big business in the fight for party insider status. Coming from big business straight onto the ruling (Puglisi 2003). In addition to being outsiders from the ruling party, they were co-opted by means of state financing. On that note a form of co-option already exists in the Bulgarian extended parentela model as we noted in Chapter 4 how a number of respondents viewed their sectoral organization as colliding with the ruling party and uncritically supporting former’s policies. Their argument was that there was some form of co-option of the leadership of what ought to be opposing trade associations. This was achieved either peacefully through some financial enticing or forcefully through type two parentela. This point rises again in the Ukrainian case, where prospective opposition from professional or trade associations was preempted by integrating those organizations in the state administrative structures through various forms of state subsidies and what appears to be appointments to said the trade associations elite of individuals whose loyalties lie with the party in power (Puglisi 2003: 106–107). Before we conclude this section we have to stress that the descriptions of president Kuchma’s tenure above are also consistent with the elements of an oligarchic state-group relations. In the previous sections we identified four criteria that qualify state-group relations as oligarchic: party-centric, community-forming, (following from the party-centric community) coercion against any political and/or economic rival and emphasis on the conversion of policy-making access into capital, as

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opposed to emphasis on using the privileged access to advance legislative improvements. Looking at the paragraphs above, we can find all of these elements. The mere fact that Kuchma suppressed trade associations and sought the active cooperation of oligarchs clearly indicates a policy-making style dedicated to the protection of the assets of said business actors, as opposed to finding sector-wide improvement of the legislative framework (Puglisi 2003: 102, 106–107, 110–111). The advancement of the so-called Dnepropetrovsk clan is evidence of the development of a selfaware party-centric oligarchic community (Klein 2012: 125). The input from Darden (2008), Puglisi (2003) and Klein (2012) on the coercive methods used by Kuchma in his own campaigns and to aid the insider oligarchs is in agreement with the definition of oligarchy advanced earlier. This final section, again, justified Hypothesis 1b in particular by arguing that the Ukrainian polity during Kuchma’s tenure was a consolidated oligarchy, political and business competition were curtailed through administrative coercion, broad coalition-building and administrative-coption. The next section will address the obvious question, what is, then, a consolidated oligarchy. The danger here is a superfluous terminological saturation with the term consolidated oligarchy.

Consolidated Oligarchy Compared What is a consolidated oligarchy and how does it differ from others used to characterize the Ukrainain polity: competitive authoritarianism and neo-patrimony. The major difference is in the level of analysis. Consolidated oligarchy refers to the relations between the state and Civil Society (Groups), while the latter two refer to the democratic relationship between the institutions in a given polity. The present section argues, therefore, that it is beneficial to introduce the term consolidated oligarchy, because it introduces another, specific, dimension when studying the Ukrainian regime. Moreover, the approach is not region-bound as it has been used to analyze Western polities, such as the US, UK, Italy, Central and Western Europe. This in other words, would stimulate the comparative approach and enrich the study on democratic policy-making and democracy overall. However, in order to promote a more nuanced terminological language, one has to responsibly and carefully define the term not only with a stand-alone definition but define in comparison to other similar terms, in order to avoid any conceptual overlap.

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Competitive Authoritarianism Levitsky and Way (2002: 53) define democracies as having four basic characteristics: (1) Executives and legislatures are chosen through elections that are open, free, and fair; (2) virtually all adults possess the right to vote; (3) political rights and civil liberties, including freedom of the press, freedom of association, and freedom to criticize the government without reprisal, are broadly protected; and (4) elected authorities possess real authority to govern, in that they are not subject to the tutelary control of military or clerical leaders. Although even fully democratic regimes may at times violate one or more of these criteria, such violations are not broad or systematic enough to seriously impede democratic rule. A competitive authoritarian regime, then, is a regime that features all of the above democratic characteristics though in a considerable degree of violation so that at times of electoral or political contestation an uneven playing field is created which strongly favors the incumbent political party(-ies). Accordingly, Levitsky and Way (2002: 52), define competitive authoritarianism as a type of a hybrid regime where: formal democratic institutions are widely viewed as the principal means of obtaining and exercising political authority. Incumbents violate those rules so often and to such an extent, however, that the regime fails to meet conventional minimum standards for democracy.

Examples of such democratic violations are harassment of opposition parties, their supporters, abuse of journalists through persecution, assault, or even murder. Elections, in turn are characterized by abuse of state power geared towards biased media coverage and forms of harassment against the opposition, although technically the electoral process itself remains legal and valid (Levitsky and Way 2002: 55). Another distinctive feature is that all branches of government are highly contested. For example, in the case of the Executive, the ruling party is using all of its resources (legal and other) to remain in power (Levitsky and Way 2002: 56). Similarly, the Judiciary is also subjected to the same kind of intense contestation with “maverick judges” ruling against the interests of the government (Levitsky and Way 2002: 56–57). Finally, there is the control of the media. In a competitive authoritarian regime, there is competition as to who will control the media. While there exist a few independent ones, armed with state-owned media

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outlets and the coercive powers of the state the ruling party counters any opposition political narratives (Levitsky and Way 2002: 57–58).

Neo-patrimonialism Erdmann and Engel (2007) trace the origins of neo-patrimonialism in the field of African Studies of 1990s, which attempted to explain the state of African democratic development and the reasons for its stasis. Accordingly, the 1990s literature on African development attempted to define neo-patrimonialism by mixing in the right proportion a number of concepts: ‘personal rulership’, clientelism, patronage, African traditionalism, modern industrial states and political systems, elites, tribalism, informal politics and Weberian legal-rational bureaucratic rule Erdmann and Engel (2007: 97–104). Dissatisfied with these feeble attempts to define neo-patrimonialism in the literature, Erdmann and Engel (2007) approached its definition by first differentiating it from patrimonialism: Under patrimonialism, all power relations between ruler and ruled, political as well as administrative relations are personal relations; there is no differentiation between the private and the public realm. However, under neopatrimonialism the distinction between the private and the public, at least formally, exists and is accepted, and public reference can be made to this distinction. Neopatrimonial rule takes place within the framework of, and with the claim to, legal-rational bureaucracy or ‘modern’ stateness. Formal structures and rules do exist, although in practice the separation of the private and public sphere is not always observed.

The commonality between the terms is that both refer to a mix between formal institutional behavior versus an informal, subjective policy-maker behavior both within the institutional confines of the state. The authors, then, offer a definition of neo-patrimonialism which comprises clientelism and patronage. Accordingly, the former, refers to the interpersonal networks forged between policy-makers and individuals, which are hierarchical and usually tend to benefit the patron. Rarely distributive and unlike clientelism under patrimonialism, clientelistic networks under neo-patrimonialism constitute much more complex relations, which involve intermediaries and gatekeepers for the provision of select public goods and services (Erdmann and Engel 2007: 106–107).

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The relationships based on patronage, on the other hand, are forged between groups and policy-makers. While the object of the exchange may still be the preferential state provision of public goods and services, the relationship is one among equals. Moreover, unlike clientelistic relations, there are abstract benefits, such as privileged access to the legislative process and the drafting of favorable legislation. While patronage, too, depends on a complex relationship between policy-makers, civil servants or other gatekeepers (brokers), the insider group in these relations may often be ethnic, as the term is derived from the African context. In a broader sense, however, the authors seem to suggest that the groups partnering policy-makers may be of strategic value to the patron as they can mobilize the electorate (Erdmann and Engel 2007: 107).

The Three Terms Compared It was stated earlier that the term consolidated oligarchy (CO) rests on the idea of politicians and top businesses that have converged around a single coherent body that informally presides over most macro-political matters of the state. As already stated, consolidation here means the process of transition from elite competition to a dominant elite status quo. The idea of consolidated oligarchy appears to be closer to neo-patrimonialism (NP) than to competitive authoritarianism (CA). The competitive authoritarianism seems to be primarily focused on the formal institutional relations within a nascent democracy or one in transition. Very little or if anything at all from the description of the CA is in any way applicable to the idea of oligarchy. Moreover, if the focus of competitive authoritarianism is on the macro-level power-relations between a strong Executive Leader, the institutions of a nascent democracy and the Opposition, then oligarchic consolidation refers to a rather different, meso-level cast of characters: civil servants, informal groups, political parties and outsiders (unsuspecting businesses, (sectoral) interest groups, rival businesses and interest groups). Furthermore, if competitive authoritarianism looks at the formal relations and institutions, then consolidated oligarchy refers to the informal mechanisms and relationships which have lead to the formation of elites and their maturity into a coherent community. Probably the only commonality between OC and AC is the idea of limited political competition, although in the end of the CO accentuates on the state of limited number of political parties with government-forming potential, while CA stresses on the

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implements available to the incumbent party to limit political competition, i.e. intimidation, media, blackmail, assassination. Both neo-patrimonialism and competitive authoritarianism are developed with reference to a strong centralist executive in a formally democratic institutional context. One difference appears to be that if both terms analyze the formal relations among macro-level actors, such as the Executive, Opposition, Political Parties in Parliament or the Media/ Public, then neo-patrimonialism looks additionally at the informal interaction between the Executive—be it a prime minister or president (in our case is President Kuchma)—and the rest of the very same actors, including social and business groups. These relations need not always be cooperative and positive, but also confrontational and negative. More specifically, neo-patrimonialism and its definition as a collective term for clientelism and patronage looks at the complex informal dynamics of an Executive which attempts to concentrate political power under functioning democratic institutions. Again, both terms focus on the mechanisms that the Executive—or rather a political leader—with authoritarian inclinations is using to maintain his position. In contrast, the unit of analysis under a consolidated oligarchy is not the Executive, but groups and political parties specifically. The former could broadly be construed as interest-, pressure-, cause or here informal groups, Trade Associations or individual businesses, corporations or plainly oligarchs. As already stated earlier, CO looks at the polity as a whole but from the perspective of the groups and their relationship with the political parties. As mentioned earlier, the extended parentela is a model that depicts the group-relations on a meso-level, which upon magnification to a macro-level assumes oligarchic characteristics. A consolidated oligarchy, therefore, is a reference to the condition of the relationship that the state and the Groups find themselves in by looking at the party-group relations. It is a static, macro-level model of the relations between groups and the state, while the other two terms appear to be a macro-level models of the Executive and its relations and other policy-participants. Still, there is some overlap between consolidated oligarchy and neo-patrimonialism. Both terms share a focus on the informal relations between groups and the Executive through clientelism and political patronage. However, again, if neo-patrimonialism explores this topic top-down, because we are interested in how the Executive manages to preserve its power, then the consolidated oligarchy does so bottom-up,

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being interested in how certain (informal) groups succeed in procuring long-term insider status for themselves by engaging with the party in power. The overlap, therefore, is insufficient to render the terms interchangeable. Before we conclude the present chapter, however, there is one very last term that is relevant to our comparative exercise, not because it is related to regimes in transition but because it overlaps with the idea of a consolidated oligarchy. The term in question is pluralism, and specifically, biased pluralism. We will briefly look into pluralism because this is still the textbook term used to describe the state-group relationships in the West and the US in our example.

Consolidated Oligarchy vs. Biased Pluralism Stated briefly, the overlap between the terms consolidated oligarchy, or simply oligarchy, on the one hand, and biased pluralism, or simply pluralism, on the other, is the inequality of power among groups. Jordan (1990) has argued that authors, who were later dubbed pluralists by their readers and critics, did not associate pluralism with a status quo of equal opportunities and political resources available to all groups, locked in the policy-making fight. Instead (with what later will be advertised as biased pluralism, sic) they associated it with conflict among groups, which is neither equal, nor fair, nor leading to a level policy-making access. That this conceptual tension is still valid today, and that Jordan’s note was left unheeded, is evident in some of the more recent and influential quantitative studies on the macro-political models that best fit the US, namely, Gilens and Page (2014) who confirmed that it is this biased version of pluralism that remains true for the US today. The conceptual confusion becomes noticeable when one observes that their research is in fact a continuation of an earlier one that explicitly focused on oligarchy, namely by Winters and Page (2009). Page is the common scientist in both studies which suggests that some degree of continuity was intended as both studies investigate the very same phenomenon using two different terms: oligarchy (Winters and Page 2009: 731–733) and biased pluralism (Gilens and Page 2014: 567–570, 574). Why is that Page (probably) decided to move away from oligarchy and operationalize the term biased pluralism later is a mater of speculation. The important bit for us is that even if we compare the four-point definition of oligarchy derived earlier to the idea of (biased) pluralism,

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we can still observe some considerable overlap between the two terms. Both of them stress on the unequal access to policy-making, the unequal distribution of power-resources and access, and the domination of some groups over legislation. So then, how do we resolve this conflation between (consolidated) oligarchy and (biased) pluralism? The answer to this question lies again in revisiting the points used earlier to establish the overlap between the idea of oligarchy and the dynamics of the extended parentela. First, while both views agree that power is dispersed unequally among groups, pluralism seems to be more concerned with actual policy-making in the sense of solving societal problems, while oligarchic relations exploit political access. That is, as Mallet-Provost explains, oligarchic policy-making has less to do with policy-making, and more to do with converting political access to economic capital (think Chalakov et al. 2008), or gain business advantage by the spoils of the office (1933: 163, emphasis added): What is the nature of the group? It is essentially a business enterprise organized professedly to represent and guard the public [but] in reality, to secure for its members the spoils of office and the benefits resulting from the control of governmental operations. […] The members of these groups are the men and women who make a business of politics as distinguished from the business of government. […] but there is a difference between the party system that exists mainly for the purpose of advocating governmental policies, and the party system that lives primarily for the spoils of office. Unfortunately, our system is of the latter type.

Oligarchic policy-making then tends to also include the politics of the spoils of the office, which seems to suggest the provision of immediate legislative and administrative benefits to an insider groups. An example of such administrative benefits can be the winning of public procurement contracts, or the subtle change in standards and licensing which can have the immediate effect of advancing certain businesses over others. Whatever it is, the presence of oligarchic insiders in the policy-making process, according to Mallet-Provost, is not motivated by a genuine interest in improving the existing legislative framework, but by a desire to quickly convert that access to capital—or immediate market advantage, if we are allowed to give it a more modern interpretation. Second is the question of the nature of the group in an oligarchic order versus a pluralist one. Mallet-Provost (1933) above suggests that these are groups that only publicly advertise their interest in improving

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existing legislation in public’s interest, which may suggest sectoral and professional bodies, although it is unlikely. His stress on oligarchic politics being business of politics as opposed to governance renders trade, professional organizations and advocacy groups unlikely candidates. That is why, as we already established in the earlier discussion, particularly with the Carlyle Group, and public tenders in Bulgaria, the oligarchic participants are informal groups, which cannot be defined in terms of public organizations tasked with the objective to protect the interest of an economy or social group. Rather these are businesses, companies or single affluent entrepreneurs who work solo or in concert to protect their common interest, unbound in a formal organization. Unlike pluralism, therefore, which is defined by clearly identifiable camps of interest groups, the view of oligarchic non-policy-making implies nebulous groups not interested in actual policy-making. It is this view that is part of the extended parentela and consolidated oligarchy. Third, another contrasting point between pluralism and oligarchy is the role of the political party. Pluralism implies that groups fight for access on any arena. However, as we discussed this point earlier and visible again the Mallet-Provost quotation above, who sees oligarchy as an association between the party system and spoils-minded groups, the oligarchic dynamic is locked between an informal group and political parties. Pluralism does not compel any such specific interaction. Fourth and finally, the competition for power and access in a pluralist order is waged by lobbying or public campaigns, or both, unlike in an oligarchic one, where competition also extends to various forms of executive coercion. As a form of low profile persuasion, lobbying is compatible with an oligarchic order, however, the crucial difference is that coercion is just as prevalent if not the major tool used by the ruling elite against its competitors. Here, the consolidated oligarchy truly manifests an oligarchic order as described in the literature: hosts amorphous sub-sectoral membership, it is party-centric, state-exploitative and coercive of outsiders. In any case, the oligarchic vs pluralist orders comparison is summarized in Table 6.1 below: And again, the point is not to belittle the results of the Winters and Page (2009) or Gilens and Page (2014) studies. The reason for this discussion was to demonstrate that there is a budding terminological overlap between consolidated oligarchy and (biased) pluralism, which needs to be addressed. This, for some, may seem like a cosmetic take on the literature, but the position here is that such a terminological precision will greatly aid us in better understanding the type of political order we live in.

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Table 6.1  Pluralist vs. oligarchic state–group relations Dimension

Policy-making Actors Competition Policy venues aDoes

State-group relations Pluralist

Oligarchic

Actual Sectoral groups Lobbying & public campaigns Any

Exploitative Amorphous, sub-sector specific Executive coerciona Party-centric

not exclude lobbying, though coercion is clearly tangible

Conclusion Throughout Chapters 2, 3, and 4, we looked at the different elements of the extended parentela, which was defined in Chapter 5 as a model of oligarchic party–group relations. The previous chapter concluded with the hypothesis that if unimpeded and in combination with a process of decreasing inter-party competition, the extended parentela dynamics will transform in an oligarchic status quo. The model and subsequent hypothesis were developed both from primary and secondary data. The question then was that in light of this high level of abstraction, can we relate the model and the hypothesized relationship to real-world dynamics. Is the extended parentela dynamic a purely Bulgarian phenomenon? Do we have reasons to believe the model is accurate and that the hypothesis could work outside Bulgaria? While it is beyond the scope of this book to engage in a field-work, the present study instead reviewed secondary literature related to the regime of President Kuchma, as a validity test, which would provide us with at least some preliminary confidence in the extended parentela model and hypothesis. The results confirmed the existence of the model and causal relationship. First of all there is evidence of diminishing inter-party, or more appropriately, political competition as President Kuchma exploited his access to the civil service by mobilizing all central and local servants to campaign for him. Also along the lines of type two parentela, the secret services were mobilized to discredit his opposition and intra-party rivals. He also attempted to diminish competition at the level of formal and informal interest groups, namely, by appealing to trade unions and ultimately controlling them through the provision of state funds, and by attracting the

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support of oligarchic communities. Most receptive to his call of support, among the oligarchic groups, or clans, was the Dnepropetrovsk clan, which as the parentela posits, was in the position to nominate new civil service appointments. Second, further in line with hypothesis 1b there was also evidence of at least attempts to limit the number of business actors on the market and with access to policy-making. Coercive powers as in type two parentela were used against economic rivals, too, where licenses were revoked from rival businesses or the same were subjected to administrative/police raids and pressure from the intelligence services. As a result, the Dnepropetrovsk clan and other equally entrenched oligarchs were in the position to directly benefit from the process of privatization of state assets (analogous to the privileged position of Bulgarian party insiders who took advantage of public procurement contracts). Ultimately and though limited by the scope of the present study, which would otherwise require a specific field-work, the available secondary data allows us to validate the very same elements of the hypothesized causal connection between the extended parentela and consolidated oligarchy. This validation means that at least on a theoretical level, the proposed relationship model and hypothesis are valid constructs. One clarification, however, is necessary. We are probably imprecise to conflate inter-party competition with political competition. As Kuchma’s presidency demonstrates, the former is only one type of the latter. There is political competition between interest groups, just as it is between political parties. And it should be repeated that this does not mean that the Bulgarian regime will transform into one analogous to Kuchma’s. Rather, we are looking at the transformation of the relations between groups and the state. Finally, by validating the causal relationship outside Bulgaria we also promoted the term consolidated oligarchy as the hypothesized end-state of the extended parentela’s transformation from a dynamic to a status quo. As the Kuchma Presidency demonstrates, it is a status quo of diminished political and economic competition, where competing political and business elites are drawn in the same elitist community (i.e. those who support his Presidency). Kuchma certainly made attempts to unify both elite types through enticement and coercion. And for the brief period of stability of his presidency we can say that such consolidated oligarchic status quo did manifest, even if imperfectly as a relationship, which was embedded in existing democratic institutions.

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References Aslund, A. (2003). Left Behind: Ukraine’s Uncertain Transformation. The National Interest, No. 73 (Fall), 107–116. Chalakov, I., Bundzhulov, A., Hristov, I., Deyanova, L., Nikolova, N., Deyanov, D., et al. (2008). The Networks of Transition—What Actually Happened in Bulgaria After 1989? Sofia: East-West [Чaлъкoв, Ив., Бyнджyлoв, A., Xpиcтoв, И., Дeянoвa, Л., Hикoлoвa, H., Дeянoв, Д., Mитeв, T., Cлaвeнкoв, Б., Cимeoнoв, O., Чипeв, П., Cтoйнeв, B., Фeлиcи, Cт. (2008). Mpeжитe нa пpexoдa – Кaквo ce cлyчи вcъщнocт в Бългapия cлeд 1989. Coфия: Изтoк-Зaпaд]. Darden, K. (2008). The Integrity of Corrupt States: Graft as an Informal State Institution. Politics and Society, 36(1), 35–60. https://doi. org/10.1177/0032329207312183. Erdmann, G., & Engel, U. (2007). Neopatrimonialism Reconsidered: Critical Review and Elaboration of an Elusive Concept. Commonwealth and Comparative Politics, 45(1), 95–119. Gilens, M., & Page, B. I. (2014). Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens. Perspectives on Politics, 12, 564–581. Jordan, G. (1990). The Pluralism of Pluralism: An Anti-Theory?. Political Studies, 38(2), 286–301. Klein, M. (2012). Presidents, Oligarchs and Bureaucrats: Forms of Rule in the Post-Soviet Space. Farnham: Ashgate (Kindle Edition). Levitsky, S., & Way, L. (2002). The Rise of Competitive Authoritarianism. Journal of Democracy, 13(2), 51–65. Levitsky, S., & Way, L. (2010). Competitive Authoritarianism. Cambridge: Cambridge University Press (Kindle Edition). Mallet-Prevost, S. (1933). United States-Democracy or Oligarchy? The Annals of the American Academy of Political and Social Science, 169, 159–171. Puglisi, R. (2003). The Rise of the Ukrainian Oligarchs. Democratization, 10(3), 99–123. https://doi.org/10.1080/13510340312331293947. Winters, J. A., & Page, B. I. (2009). Oligarchy in the United States? Perspectives on Politics, 7(4), 731–751.

CHAPTER 7

The Parentela and Oligarchy

The major contribution of the BPS is that it enriched the original parentela model with greater dynamism, which stems from the discovery of the second parentela dynamic and the non-policy-making dimension of the extended parentela as a whole. According to the first parentela arrangement discovered by La Palombara, a parentela insider ensured a privileged positioning in the civil service through the nomination of new or utilizing already existing political appointments made by the party in power (1964). This meant that any legislation, under discussion with interest groups and organized by the civil service would be under the oversight of civil servants who are loyal to the ruling party or the parentela insider. Either way, a parentela insider is strategically positioned to passively oversee and actively shape any nascent legislative initiative. The discovery of the parentela in the Bulgarian polity, however, revealed that insiders may also have non-policy-making objective. If the earlier versions of the model discussed it in the context of specific legislation, the Bulgarian parentela insiders are not exclusively interested in policy-making. First and foremost, with the distribution of public procurement contracts, one can observe that parentela relations have been utilized in a non-policy-making manner. Indeed, it is self-contradictory to state that a group is involved in policy-making but not for the sake of policy-making, yet this is the case. However, this is not anything new. Lukes has argued that the second dimension of power (Lukes 1974: 16–19) is that of resisting political change. Interest groups that have attained insider status among policy-makers eventually are put in the position to defend the © The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3_7

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status quo that they benefit from. And one way of doing so is to remain in policy-making but for the purpose of non-policy-making, that is, to resist policy change. They would fight to control government’s agenda and attempt to filter out any political issues that might jeopardize their insider status, but that is not policy-making, strictly speaking. Another example of non-policy-making is coercion. In the Bulgarian case, we were able to observe the parentela extending into the regulatory agencies of the state. Insiders in the Bulgarian case are no longer satisfied from, or interest in, dominating consultations. Instead, they may seek a direct engagement with their market competition by exercising control over the state regulatory agencies. The type of direct engagement we discussed here were the prejudiced regulatory inspections, or type two parentela. Again, these stand for the practice when a regulator targets a business with the ulterior motive to disrupt its operations to the advantage of the party insider. Another way we can conceptualise non-policy-making is with the concept of conversion. Borrowed from Chalakov et al. (2008) and later re-discovered in the literature on oligarchy, and the Kuchma case, conversion stands for the exploitation of one’s privileged position in policy-making by extracting short-term non-legislative and immediate benefits for themselves. One example could be the privileged distribution of public tenders (Chapter 3), prejudiced inspections (Chapter 4) or the later attempts by the Ukrainian clans to gain preferential standing in the process of privatization of state assets. The impulse to engage in such non-policy-making, according to the BPS, originates from the need to improve one’s market position, or to survive in a shrinking economic sector. The engagement of the Ukrainian oligarchs on parentela terms with president Kuchma could be explained with their similar desire to preserve and expand their wealth, which is just as relevant to the Bulgarian reality. From the perspective of political parties, conversion takes the shape of either exchanging the access they provide to party insiders for campaign contributions or re-directing public monies to themselves. For instance, the case on procurement contracts in Bulgaria also demonstrated that part of the deal between the ruling party and the insider is that the budget dedicated to the completion of the public project (or provision of public service) is divided in some way between the party, obliging civil servants and the group. It is also this conversion performed by the party and its insider that Mallet-Prevost (1933) has labeled earlier as the spoils of office pursued by what he called the oligarchy.

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Finally, prejudiced inspections, could also be seen as a form of conversion, where insiders improve their business competitivenes by influencing the behaviour of the regulatory agencies. The BPS also revealed that political parties, too, could be engaged in non-policy-making. None of the above should deflect from the fact that prejudiced inspections can also be used by political parties in order to suppress political dissent: either from within or from outsider (interest) groups. In this case, the targeted business entities are those of the dissenting party functionaries or of those firms which comprise the interest group opposing party’s policy line. Likewise, in terms of conversion, we also observed in interview responses, the VUARR report and in some of the key statements made in Chapter 5 that political parties may also try to take material advantage, particularly when it comes to the award of public tender. These new dynamics of the parentela, then, paint the party in a different light—as a semi-interest group which is just as focused on its own survival as any other social organism, if we are allowed the luxury of imagining groups in general as organisms. Type two dynamics and non-policy-making, then allow us to see political parties and their insiders, i.e. the parente, in an elitist light, and the extended parentela as an oligarchic dynamic. Parties and party elites are in the position to concentrate power. We observed here that party’s ability to control the appointments in the civil service allows it to control the service itself. The case on the NCTC demonstrated that parties have the potential to shape the structure of consultations, which can effectively filter out opposing groups. Moreover, again through prejudiced inspections, a ruling party can engage its political rivals. Businesses that are members of trade associations that oppose government policies would then be the prime targets from the ruling party. These two scenarios act as instruments of coercion against any political opposition, and, too, can be used against intra-party defectors. All in all, these are instruments that allow the ruling party to concentrate power. Not because such is formally conferred to the institution of the Prime Minister, for example, but becuase these instruments enforce the impression that the ruling party route to an effective participation in policy-making is the most effective one. At the same time, we can see party insiders as the business half of this elite. The reiteration of the cooperation between ruling parties and their insiders breeds trust and begins to take shape of a community of the privileged. This was evident both by the respondents who spoke in terms of families with privileged access, or using the phrase “either with

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us or against us” to describe the dominant mentality at the party-insider level. Another example of such mentality are the so called circles which we introduced earlier. A sense of community is not foreign the policy networks in general. Richardson and Jordan (1979) discovered a similar process of community-formation in the British civil service, when they discovered the policy community policy network type. In fact, the name itself suggests that the preferred policy style in the 1970s–1980s rested on a set of values and principles, whose reiterated observance by those involved in British policy-making granted them an insider status, but most of all—as the name suggests—shapes a community. The extended parentela model, therefore, goes further from its initial definition of La Palombara, because it now reflects the dynamic where (informally) overpowered ruling parties with their privileged insiders compete against other party-centric elites, and unsuspecting outsiders. The dynamic begins with a party winning elections and the elite formation following a reiterated cooperation with an informal group. Once formed, the parente is in the position to expand politically and economically, knowing that the improvement of the positioning of the one partner (say, the business insider) improves the positioning of the other (say, the party). For example, the better market positioning of the insider, the more reliable they become as a donor, and at the same time, the more reliant the insider becomes on the privileged standing which the party provides them with. The better positioned the party becomes in the civil service, the greater the policy-making benefits that it can offer to its insider, e.g. privileged access to consultations or the award of public tenders. Thus, the party and its insider can be seen as behaving as a single elitist unit because each side needs the other for long-term benefits. It is this unit, then, that grows through patronage and coercion. The availability of party patronage enables the parente to populate strategic civil service agencies and consultative bodies with trusted appointees, nominated either by party’s rank and file or the insider themselves. Again—we can see this not only as an advantageous move by the party insider, but rather by the parente as a whole. In other words, what we have described earlier in terms of individual benefits accrued to a party insider through type one and two parentela dynamics, that could just as well be seen as the mechanisms through which the elite embeds deeper in the institutions of the state and the market. Thus, as regulatory coercion for political or economic benefit share the common source—the parente—then it follows we can speak of it as a single unit of elitism.

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Therefore, any move in those directions means the improved standing of that elite at the expense of the others. It is a zero-sum game. The award of public tenders to party insiders means that potential gains have been denied to rival elites. The successful harassment of outsider businesses leads to the vacation of market space, which is then absorbed by the party insider. A control over ruling party’s agenda or consultative process as hosted by the civil service means that ensuing legislation could go directly against the interests of rival elites. Thus, again, the dynamics brought into the model by the discovery of type two parentela and its discovery in non-policy-making contexts have greatly enriched the parentela model not only in terms of causal dynamics but also in terms of levels of analysis, which allows us to perceive the, now, extended parentela as a dynamic which simultaneously generates and eliminates oligarchic elites. Again, this dynamic is seen here as a competition among elites which is re-started whenever a party loses parliamentary elections and another that comes to power. But then again there is the question whether there is other evidence that allows us to state that the observed extended parentela dynamics are indeed oligarchic, and what does that mean? Chapter 5 reviewed some of the literature on the subject of oligarchy and compared the described dynamic to the extended parentela. Four overlapping points became evident as a result of this. Oligarchic dynamics are characterized by: (1) party centrism; (2) community-formation; (3) conversion and (4) coercion. Point one refers to the fact that what we perceive as state capture by a private business is in fact the result of successful negotiations between capturing business and policy-makers. At least in Bulgaria, parties in power act as gatekeepers to the policy-making process, facilitated by political patronage. Therefore, any perceived benefits accrued to a private company cannot be the result of a capture, but permission granted by the party in power. Reviewing the oligarchic literature also reveals a similar stress, particularly evident in the case study of Briody on the Carlyle Group investment fund, which heavily relied on forging close relations with active and former politicians of any party in order to secure privileged access to defense procurement contracts (Briody 2003). Point two refers to the idea that an oligarchy comprises a community. We already touched above on the community-forming mechanics of the extended parentela whenever parties and insiders reiterate their cooperative endeavors. The Carlyle Group is a community, just as are the Bulgarian circles of close interaction between ruling party politicians and select businessmen.

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Point three refers to the idea that parallel to policy-making, ruling parties and their insiders are also engaged in the process of converting their privileged policy-making access into capital. We observed that with the chapter on public tenders and type two parentela. A similar confirmation was found in the oligarchic literature where Mallet-Provost (1933) in particular highlighted that that behavior was a key feature of oligarchic dynamics. Briody (2003) in turn demonstrated the same point with Carlyle’s push for gaining insider status in the defense administration in order to secure lucrative defense contracts. Here is probably the place to make another parenthetical point about conversion and the type of party insiders in the case of the extended parentela which can be seen as another novelty introduced to the intitial model. In all three studies on the parentela (La Palombara 1964; Greer 1994 and Yishai 1992), the partnering insider was a formal interest group. In the Bulgarian case, however, the parentela insider is what we called here, an informal group. An informal group stands for either a single or a number of companies, firms, corporations or extremely affluent individuals (such that would be called oligarchs) who represent their collective or own interest, as opposed to those of a social group/strata (think, advocacy coalitions), profession or sector of the economy (peak association, trade union). This is in turn suggests that there might be a correlation between the type of group assuming insider status and the nature of the demand. Namely, an informal group would seek to convert its access, while a formal group would be more interested in changing the legislation. While this may be subject of future research, this important distinction remains. Finally, coercion is the last feature shared both by the oligarchic literature and the extended parentela. The extended parentela saw type two or the prejudiced regulatory inspections as weapons of coercion employed by the ruling party or its insider. The case on Carlyle whose members attempted to secure access to the intelligence and defense departments of the US and the wider oligarchic literature, too, confirm coercion as part of the definition of the concept (e.g., Leach 2005). Of course, the list may be incomplete. Other researchers might emphasize on other dimensions as defining the parentela. However, the four that were extracted from the literature review considerably cover both dynamics: the one that is labeled here extended parentela, and the one referred to as an oligarchy. That is why they are adopted.

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So far, we re-examined the construction of the extended parentela along with the novelties introduced to the model by the BPS. From the basics of the model, as defined by La Palombara (1964), to the discovery of its second dynamic and leading to the re-conceptualization of the network model as one of party-group oligarchic relations. But in the end of the day, there is the question of the effects of the extended parentela dynamic on the Bulgarian polity and democracies in general? This question is not new and in part motivated the writing of the present monograph. In his study on the parentela, La Palombara was confronted with the question of the possible link between oligarchy and the parentela (1964). Some of his respondents spoke in terms of Italian oligarchy when discussing the party–group relations in Italy at the time. The argument was that everything in Italy was politically decided by the Christian Democratic party, the affluent families and the number of wealthy industrialists. These responses then prompted the question whether the parentela was a synonym of oligarchy or whether there is a link between the two at all. La Palombara is quite dismissive of the idea that 1960s Italy was an oligarchy or that any such links could be established. And so, the study behind the present book initially did not set out to investigate this question. The situation, however, changed when the rich qualitative data from the Bulgarian Parentela Study brought this subject back to light. At first, some of the respondents directly spoke in terms of elites and an oligarchy. That simply reiterated the same confrontation that La Palombara experienced. However, this subject appears again once we look at the extended parentela as a model of state-group relations from a macro-level of analysis. The policy network literature normally operates on a meso-level, that is on the level of interest groups, ministriers, NGOs, corporations, courts, Parliaments, civil service. However, from a macro-level we can discuss the same relationships from a larger perspective—of the policy network as a whole, and its effect on the politics of the state. And again, the macro-view was made available with the discovery of the second parentela dynamic. So, therefore, the short answer to the question on the implication of the extended parentela on the Bulgarian polity is the hypothesis that the continued reiteration of the extended parentela dynamics and in combination of decreasing inter-party (or political) competition can serve as a process that could lead to an oligarchic status quo.

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But what does it mean? The extended parentela as an oligarchic model is a dynamic, and not a regime. The emergence of elites and their competition occurs within the state-group set of relations. For example, corporatism and pluralism are macro-level state-group relationship models within a democratic institutional framework, just as the extended parentela purports to be as well. However, an oligarchic regime, is seen here as the formal institutionalization of an oligarchic rule. This scenario, at this point in time, however, seems hardly possible. It is inconceivable that anyone would openly advocate an oligarchic regime and change institutions accordingly. There, however, are other scenarios that can transform Bulgarian politics to a stage below a regime, namely, a status quo. How does the hypothesized oligarchic consolidation unfold? This is the result of two processes: one of the continued extended parentela which has the effect of reducing the business players per economic sector, who later seek to partner the party in power, and the other of the diminishing inter-party competition. The consolidation hypothesis is partly based on the idea that the reiterated dynamics of the extended parentela will ultimately diminish the number of private actors who would later partner ruling political parties. These actors are essentially the businesses comprising the informal party-insider group. This is idea, expressed as a hypothesis 1a in previous chapters stems from the coercive feature of the parentela. The second parentela dynamic states that businesses with outsider status risk being coerced by the parente in power. As it is a zero-sum game, where any gain by the insider is an outsider’s loss, and where the end result will be that a fewer players will be left, who at the same time will be more affluent than before. We have to remind again that this simple declaration risks suggesting that the type two parentela may bring the impression of some degree of checks and balances between competing elites. In the spirit of biased pluralism, political resources and power are unequally distributed. This means formal or not, groups competing for political access have varying chance of assuming insider status and keeping it. This also means that although the extended parentela creates zero-sum dynamics, given the imbalanced or biased political environment, it does not follow that these are perfect. Not every new elite in power will be effective in checking previous elites. In fact, a safer strategy may not be to engage previous business elites, but engage with unsuspecting outsiders.

7  THE PARENTELA AND OLIGARCHY 

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The other process parallel to the above, and necessary for the arrival of the consolidated oligarchic status quo, is the curtailment of inter-party competition. The study initially hypothesized two major scenarios leading to this effect: a change to a predominant party system or an interparty policy-making approach of grand coalitions and consociational democracy. The first scenario refers to one of Sartori’s party system type characterized by a pluralist party competition where a single party wins absolute majority for at least 4 consecutive terms. The second scenario is a style of governance where political parties decide to unite and govern together in grand coalitions. The Ukrainian case revealed that certain refinement in the above hypotheses is necessary. First of all, grand coalitions and predominant party systems are not the precise term to signify the competition on elite political level. Formal and informal groups, such as Trade Unions and single oligarchs, too, are part of it. This became evident when the case revealed how President Kuchma subjugated one of the more influential trade union in Ukraine by providing it with state subsidies, while at the same time appealing to all oligarchs to support his candidacy, as there will be spoils for everyone. Second, the Ukrainian case revealed something that is theoretically plausible under the extended parentela, but there was no evidence of. We observed type two parentela used both against opposing interest groups and dissenting rank-and-file. This in turn suggests that administrative coercion could be used against the donors of political parties. Though plausible, there was no direct evidence of that in the BPS, although no evidence was found. The Ukrainian case demonstrated that the Kuchma presidency used the resources and agencies of the state to intimidate the opposition. With regards to the hypothesis, this means we should also hypothesize that type two parentela can also diminish political competition. This also means that future research has to be informed by the much simpler generаl hypothesis that the extended parentela causes a process of oligarchic consolidation, which can be catalyzed by a predominant party system or a consociational style of governance. Now that the hypothesis has been stated on the basis of primary and secondary data, there is the question whether it is valid. Has the level of abstraction made the hypothesis far-fetched from the real world? Is the extended parentela at all applicable to other cases? If the hypothesis and the model it is based to are valid then there should be evidence of their applicability to other cases.

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With Chapter 6 we explored these final concerns with both the model and the hypothesis based on it. We looked at the case of Ukraine and the tenure of president Kuchma from mid 1990s to mid 2000s. Limited by the scope of the exercise and available space and resources, the book conducted a literature review of the available secondary data on the democratic state of Ukraine. The objective was to find any evidence of the elements from the hypothesized causal relationship: evidence of the extended parentela dynamics of diminishing business actors, limited political competition and evidence of the characteristics borne by a consolidated oligarchic rule. The exercise demonstrated that, similar to the basic parentela, the Kuchma presidency appointed to top ministerial positions or in the civil service individuals nominated by what is commonly known in Ukraine as the clans. Akin to the informal groups from the extended parentela or the Bulgarian circles, these are informal groups comprising regional businesses behaving as a single unit and usually represented by a single person also labeled an oligarch. Similar to the second parentela dynamic, as well, President Kuchma was able to rely on the coercive powers of the state both in terms of prejudiced inspections and the intelligence forces. A consolidated oligarchic status quo was described as the extended parentela dynamic minus the competitive element and exhibiting the four characteristics of an oligarchy: party-centrism, conversion, elitist community-building and coercion. First, the regime has been defined as neo-patrimonial and competitive authoritarian. Both terms are based on the idea that despite parliamentary and presidential elections, the democratic institutions are under the severe influence from the Executive. In this case, it is President Kuchma. The consensus among the authors— and as evidence demonstrates—is that the President exploited his control of the civil service in order gain advantage over his political and economic competition. This is not to say elections were falsified but that legal-administrative barriers were imposed on the opposition in its ability to organize, e.g. favorable media coverage, forcing the civil service to informally mobilize voters (friends, family, etc.), withhold permits for meetings and protests, etc. All of this renders President Kuchma’s presidency a polity with low political competition, which falls in line with the consolidated oligarchy. With regards to the four oligarchic points, in the Ukrainian case the notion of party-centrism overlaps with the presidency of Mr. Kuchma. His attempts to stifle political competition and control over the civil service

7  THE PARENTELA AND OLIGARCHY 

157

and render the party venue as central vis-a-vis other venues. Any policies had to be coordinated with president’s administration. As the articles suggest, there was a competition among some of the clans for closer access to the president. The community-building element is evident with the clan-culture which the presidency maintained, while coercion was observed with Kuchma’s control over civil and intelligence services. We also saw that conversion, too, was evident in Kuchma’s tenure particularly in the process of privatization of state assets, where certain clans prevailed over others thanks to their close relationship with the Presidency. Finally, the search for the elements of the oligarchic model in Kuchma’s tenure, prompts the question whether there is a conceptual overlap between consolidated oligarchy and the terms used to describe his tenure: neo-patrimonialism and competitive authoritarianism. The closer study of the definitions towards the end of Chapter 6 demonstrated that consolidated oligarchy is a distinct term from competitive authoritarianism and somewhat closer to neo-patrimonialism, although it is not sufficient to render the terms interchangeable. The major distinction is in the unit of analysis of in the extended parentela and in consolidated oligarchy, which is the group—formal or not. Following the policy network approach, the extended parentela and by an extension the consolidated oligarchy look at the relationship formats group engage in with policy-makers. We may then choose to look at those relationships from a larger perspective, but that would be an exercise of generalizations from a lower analytical level of analysis to a higher one; hence, the re-imagining the extended parentela as an oligarchic dynamic. In contrast, the other two terms are focused on the Executive and its attempts at maintaining or concentrating political power in the context of democratic institutions. Competitive authoritarianism focuses on the overt dynamics surrounding the tense contestation of democratic institutions by the Executive and its opponents, while neo-patrimonialism is a reference to the informal mechanisms of patronage and clientelism used to the same ends. And here lies the conceptual overlap between neo-patrimonialism and consolidated oligarchy. Both terms are partly defined with reference to the relationship between the Executive or the party in power, and the groups that be. The distinction here is the perspective. The consolidated oligarchy is a concept derived by the bottom-up approach because it is based on tracing how groups interact with the various policy venues. On the other hand, neo-patrimonialism features a top-down perspective on

158 

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how the Executive—as a macro-political concept—interacts with groups, as expressed by the concepts of clientelism and patronage. Nevertheless, it is not seen here that this overlap is sufficient to render the terms synonymous. The other major distinction is based on what the terms are: descriptive or causal models. Both neo-patrimonialism and competitive authoritarianism are labels describing what the Executive regime does. It may engage in clientelism, patronage, or may opt for favorable media exposure, but these activities are part of the definition. Instead, with the advancement of consolidated oligarchy as the result of the combined processes of the extended parentela and diminished party competition, we seek to advance a dynamic model or a process with an explanatory power. Finally, because consolidated oligarchy insists that its major distinction from the other two terms is its focus on the relationship between the state and groups, then the study ended the comparative section by addressing the question whether it is different from biased pluralism. This term refers to a condition in the state-group relations where groups are freely competing with one another for access to policy-making. Debates on terminological purity aside, the term signifies that power resources and access to policy-making are not equally distributed. Some groups, therefore, are in the position to carve out a dominant position for themselves, while others are peripheral insiders at best. The necessary comparison with consolidated oligarchy suggests that while both terms converge on their focus on the inequality of political participation of groups, the nuances in the relationships under investigation render the terms sufficiently distinct. Consolidated oligarchy, therefore, differs from biased pluralism on the grounds that: it is party-centric, conversion-focused, coercive, and also involving informal interest groups. On the other hand, the pluralist narrative seems to be looking at formally established interest groups, such as Trade Associations, NGOs or any sectoral, professional or advocacy organizations. So, what gains have been made so far with the present book with regards to the parentela? What would be the implications of the hypothetical relationship, should it be validated?What does it tell us about democracy and politics?

Probably the most pressing question right now is the implication of the hypothesis for democracy. The hypothesis suggests that the parentela

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159

policy-network can serve as a process that can explain the formation of an oligarchic status quo. The research so far has allowed us to enrich the initial parentela to the point it has become a process. In its starting version the parentela was merely an observation of the relationship between one interest group and the party in power in Italy, which relationship was later confirmed in Northern Ireland. The discovery of the second arm of the parentela, then, allowed us to look at the network from much greater analytical depth. Horizontally, we can look at the extended parentela strictly as a party–group relationship, from the very same perspective La Palombara did in in 1960s. Furthermore, the rich data allows us to perceive the parentela as a causal and dynamic model of party-group relations: those of conflict and cooperation. Pressured by the need to convert their policy-making access to capital, both the party and interest groups engage in the formation of the (extended) parentela. Parties are drawn because the actual campaign costs will not be tolerated by the public purse, while companies particularly in flagging industries might find political protection as their only solution to inevitable bankruptcy (or simply want to improve their market standing regardless). Vertically, from a higher view-point, we can now look at the extended parentela as a process, which in combination with diminished party competition can transform the party-group relations to an oligarchic status quo. This, in turn allows us to address the question of the relationship between the parentela and oligarchy that La Palombara was confronted with in his initial study. The research ultimately theorizes that under certain conditions the parentela can act as a process of transformation of the relationship between Groups and the state: from an oligarchic dynamic to an oligarchic status quo. The extended parentela reveals how anti-democratic processes can function embedded within a democratic institutional framework. It demonstrated that an oligarchic rule can be enforced through the regulatory agencies of the state and latter’s control over the consultative process in the civil service. Both measures effectively allow the incumbent party to either coerce non-compliant groups (or businesses funding those) or nullify their access in the civil service. A group can still be invited to consultations but any measures accepted by the civil servants would have no weight, if the latter are politically appointed and disfavour. The book therefore argues that the oligarchic dynamic which we can observe in present-day Bulgaria can transform into an oligarchic status quo.

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Having said that and delivered the final accords of this volume, hopefully, we have found a process that can shed more light on the reverse processes to democratic transition. If the democratic literature is concerned with democratic consolidation, one can argue that we were interested in the reverse process of transition towards a non-democratic rule, albeit embedded in a democratic institutional framework. As this research demonstrates, the concern with the formal institutions of the state deflects from the undercurrent processes that may establish a different status quo that is not visible from the outside. So, hopefully, the extended parentela and consolidated oligarchy will prove to be effective analytical tools to detect non-democratic processes early in advance before Bulgaria or any other state transitions away from a democratic policy-making.

References Briody, D. (2003). The Iron Triangle: Inside the Secret World of the Carlyle Group. Hoboken: Wiley. Chalakov, I., Bundzhulov, A., Hristov, I., Deyanova, L., Nikolova, N., Deyanov, D., et al. (2008). The Networks of Transition—What Actually Happened in Bulgaria After 1989? Sofia: East-West [Чaлъкoв, Ив., Бyнджyлoв, A., Xpиcтoв, И., Дeянoвa, Л., Hикoлoвa, H., Дeянoв, Д., Mитeв, T., Cлaвeнкoв, Б., Cимeoнoв, O., Чипeв, П., Cтoйнeв, B., Фeлиcи, Cт. (2008). Mpeжитe нa пpexoдa – Кaквo ce cлyчи вcъщнocт в Бългapия cлeд 1989. Coфия: Изтoк-Зaпaд]. Greer, A. (1994). Policy Networks and State-Farmer Relations in Northern Ireland, 1921–72. Political Studies, 42(3), 396–412. La Palombara, J. (1964). Interest Groups in Italian Politics. Princeton University Press: Princeton. Leach, D. K. (2005). The Iron Law of What Again? Conceptualizing Oligarchy Across Organizational Forms. Sociological Theory, 23(3), 312–337. Lukes, S. (1974). Power a Radical View (1st ed). Studies in Sociology. British Sociological Association. Basingstoke: Macmillan. Mallet-Prevost, S. (1933). United States-Democracy or Oligarchy? The Annals of the American Academy of Political and Social Science, 169, 159–171. Richardson, J., & Jordan, A. G. (1979). Governing Under Pressure: The Policy Process in a Post-parliamentary Democracy. Oxford: Martin Robertson & Co. Yishai, Y. (1992). Interest Groups and Bureaucrats in a Party Democracy: The Case of Israel. Public Administration, 70(2), 269–285.

Appendix

The Appendix features additional tables that shed more light on the respondent pools and respondent recruitment process. Table 1 represents the profile of La Palombara’s respondent pool. The codes are the same as they were mentioned in the methodological section in the Introduction. Table 2 illustrates the profiles of all respondents in the BPS. In addition to the profile, we are also including the map of Bulgarian respondents which illustrates the process of respondent selection. In order to maintain their anonymity, each respondent was assigned a code during the field-work. At the stage of writing up, the codes were substituted with pseudonyms. The map or network is developed on nVivo. In more detail, the study initially divided respondents in three groups: primary—those who belonged to Bulgarian circles; secondary—those who participated in policy-making outside any interest groups or circles, and tertiary: those respondents who were part of interest groups, e.g. trade associations. Primary respondents are denoted with circles, secondary with rhomboids and the tertiary with squares. Intermediaries are denoted with circles or elliptical shapes. In figure comments are denoted with trapezoid or a yellow rectangular shape (Fig. 1).

© The Editor(s) (if applicable) and The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3

161

Servant of the Ministry of Industry and Commerce Servant of the Ministry of Treasury Servant of the Ministry of Foreign Affairs Servant of the Ministry of Treasury Servant of Ministry of Agriculture Servant, “highly placed” in General Accounting Office Servant of the Ministry of Finance Commando Generale “high placed” Socialist deputy Leader of Christian Democratic Party Leader of Christian Democratic Party Leader of Christian Democratic Party Socialist deputy Member of the senate Leader of Confindustria Leader of UILa Leader of UIL Leader of the National Civic Committee Leader of UNURIa Representative of IRIa Informed writer Anonymous

307, 83

314, 46 316, 40 345, 4 337 fn. 37, 29 334, 36 320, 31 311, 98 312, 30 319, 80 336, 20 338, 35 344, 65 309, 33 310, 81

329, 17

309, 3 318, 7 328, 16 344, 37 326, 79

Description

Page number, interview number

Table 1  Italian respondent pool

1 ? ? ? 1 1 ? ? ?

? ? ? ?

?

Groups

? ? ? ?

?

?

? ? ? ? ?

?

1 1 1 1 1 1

COM DIR TA

MIN

ADV

MP

LDR

Administration

Party B

J

1

W

1

U

(continued)

Misc

162  Appendix

aA trade association in Italy MP Member of Parliament MIN Minister, ex-minister LDR Leader of Pol. Party COM Participated in Consultative Committees ADV Adviser to Party HQ, PM, MIN, Department DIR Appointed Director of a state agency/firm TA Director of a Trade Association B Business Owner J Journalist W Writer U Unknown

7

6 25

310, 94 Anonymous 335, 59 Editor of a left-leaning periodical 337, 90 Journalist 303, 54 key observer of the administrative process TOTAL respondents per sub-category TOTAL respondents

Groups

6

COM DIR TA

MIN

ADV

MP

LDR

Administration

Party

Description

Page number, interview number

Table 1  (continued)

0

B

2

1 1

J

Misc

1

W

1 3

1

U

Appendix

  163

Golemanov Dimitrov Kuzmanov Georgiev Aleksandrov Konstantinov Lyubenov Nikolov Mitrev Bachv arov Kirilov Petkov Hristov Valentinov Penchev Hadzhiev Zlatarov Cenov Gospodinov Donchev Mihailov Rumenov

Respondent

1 1

1 1

1

1

1 1

1 1

1 1

1

1

1

1

1

1

1 1

1

1 1

1

1 1

1

1

1

1

1 1 1

COM

1

1

1 1

1

1

DIR

MIN

MP LDR

ADV

Administration Groups

Party

Table 2  Bulgarian respondent pool

1 1 1

1

1

1

1

1

1

1

1

1

1 1

TA B 07* 9091

1 1

1 1

1

36.9194

1

1 1

1 1

1

37.9597

1

1

1

1

1

38.9701

1 1

1

1 1 1 1

1

39.0105

1 1

1 1 1

1 1

1

1 1

1

1

1

1 1 1 1 1

1

1

1

1 1

1

42.1317

(continued)

40.0509 41.0913

Periods of Policy-making activity measured in parliamentary mandates

164  APPENDIX

55

22

11

5

6 18

4

8

1

COM

6

DIR

MIN

MP LDR

ADV

Administration Groups

Party

MP Member of Parliament MIN Minister, ex-minister LDR Leader of Pol. Party COM Participated in Consultative Committees ADV Adviser to Party HQ, PM, MIN, Department DlR Director of a state committee/commission/agency/firm XX.YYZZ Person active during respective Parliament tenure XX ordinal number of the Parliament YY start of Parliamentary tenure ZZ end of Parliamentary tenure 36.91-94 For example: XXXVI Parliament, from 1995 to 1997 37.95-97 7* The VII Great Parliament (double the seats) TA Director of a Trade Association B Business Owner

Stoyanov Dobromirov Petrov Varbanov Subtotal per sub-category Total per category Total positional

Respondent

Table 1  (continued)

15

1 1 9

1

5

36.9194

6

37.9597

5

38.9701

Total temporal representative (above)

56

1 6 5

1 1

TA B 07* 9091

8

39.0105

11

1

10

1

40.0509 41.0913

Periods of Policy-making activity measured in parliamentary mandates

6

1

42.1317

APPENDIX

  165

166  APPENDIX

i0 or 000i [/ (000)]

IF i0 - researcher personally knows intermediary. IF 000i - researcher is not acquainted to the intermediary.

210i / i2

000

i2

i5

i3

210i / i2

Mentioned in Interview Neutral attitude to latter respondent Neutral snowballing

i6

i4

i11

i9

i7

i0 or 000i intermediary; 000i (000) intermediaryturnedrespondent and vice versa

i8

i10

Primary Respondent: circles and grupirovki

ACCESS OK Mentioned in Interview: negative attitude to latter respondent Negative snowballing

NO ACCESS

Respondent-turned-Intermediary

secondary respondent: politicians and civil servants

Colour Codes PARTIAL ACCESS

Tertiary Resp.: interest groups and business

Intermediary Intermediary

000 000

258 i4 259

i5

246

210

237

279 239

277

280 278

274

242

247

i3

14 /

1454

250

001 / Intermediary 1

244(i)

237

28 0

248

260

239

240

24 3

236 241

241i

002

238

205i (250)

208

32184

REL 10125205213

211

REL 1012 5-211

intermediary into respondent

15/

213

REL 002 213

211 i

208i (248)

31869

REL 1011510125

10333 103

31768

30135

10115

REL 101 10125

10129

31667 30131

10118

301 30232

10335 10116

31970

32083 321

1125

REL 10125205

234 Dimitar Ivanov (MULTI CEO) memoirs in Toshev

32185

003 pilot / not used

Researcher

30182

10127 205 block ing risk

31566 300

10117 11

302

10120

30251 10130

31465

i1 2004b.Tos hev.Memo iers

205

Videnov memoirs in petev 2008

10128

10121

30249 31364

10122

2004a.Tos hev.Memo irs

303

10124

30353

30455

i1

10123 10119

i8

31263

30556

212

30381

blocked access to 212

30352 30657

31162

30771 310

30872 30973

31035 10126

31061 31031

Fig. 1  Bulgarian respondent map_redacted

Extended Bibliography

19min.bg, The Circle Kapital Fostered a Party [Кpъгът Кaпитaл Ocинoви Пapтия]. (2010, February 25). 19min [Дeвeтнaдeceт минyти]. Retrieved from http://19min.bg/news/8/26914.html. Adler, P., & Adler, P. (2001). The Reluctant Respondent. In J. Gubrium & J. Holstein (Eds.), Handbook of Interview Research (pp. 515–535). Thousand Oaks: Sage. Administrative Registry. Retrieved from http://ar2.government.bg/ras/. Another Deputy Minister Connected with the Skull Was Appointed [Haзнaчиxa oщe eдин зaм.-миниcтъp cвъpзaн c Чepeпa]. (2013, July 23). Bivol [Бивoлъ]. Retrieved from https://bivol.bg/botev-cherepa.html. Aoslund, A. (2014). Oligarchs, Corruption, and European Integration. Journal of Democracy, 25(3), 64–73. Aslund, A. (2003). Left Behind: Ukraine’s Uncertain Transformation. The National Interest, No. 73 (Fall), 107–116. Atkinson, M. M., & Coleman, W. D. (1989). Strong States Weak States: Sectoral Policy Networks in Advanced Capitalist Economies. British Journal of Political Science, 19(1), 47–67. Bakalov, I. (2011). In the Shadow of Borisov [B Cянкaтa нa Бopиcoв]. Sofia: E-Press. Barker, D. W. M. (2013). Oligarchy or Elite Democracy? Aristotle and Modern Representative Government. New Political Science, 35(4), 547–566. Barnes, A. (2007). Extricating the State: The Move to Competitive Capture in Post-Communist Bulgaria. Europe-Asia Studies, 59(1), 71–95.

© The Editor(s) (if applicable) and The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3

167

168  Extended Bibliography BCCI (Bulgarian Chamber of Commerce and Industry). (2011a, December 15). Transcripts of Parliamentary Debates. Retrieved from http://www.bcci.bg/ bulgarian/parliament/. BCCI (Bulgarian Chamber of Commerce and Industry). (2011b, December 16). BCCI Press Release. Retrieved from http://www.bcci.bg/news/2613. BCCI (Bulgarian Chamber of Commerce and Industry). (2011c, December 15). BCCI Press Release. Retrieved from http://www.bcci.bg/news/2578. BCCI (Bulgarian Chamber of Commerce and Industry). (2011d, December 15). Parliamentary Debates Transcripts, #236. Retrieved from http://www.bcci. bg/bulgarian/parliament/236.doc. BCCI (Bulgarian Chamber of Commerce and Industry). (2011e, December 15). Parliamentary Debates Transcripts, #237. Retrieved from http://www.bcci. bg/bulgarian/parliament/237.doc. BCCI (Bulgarian Chamber of Commerce and Industry). (2011f, December 15). Parliamentary Debates Transcripts, #238. Retrieved from http://www.bcci. bg/bulgarian/parliament/238.doc. Belur, J. (2014). Status, Gender and Geography: Power Negotiations in Police Research. Qualitative Research, 14(2), 184–200. https://doi. org/10.1177/1468794112468474. Berry, J. M. (2002). Validity and Reliability Issues in Elite Interviewing. PS: Political Science and Politics, 35(4), 679–682. Beyrle, J. (2005). Top Bulgarian Money Launderer Shot Dead in Sofia. Telegram, 05SOFIA1847_a. Retrieved from https://wikileaks.org/plusd/ cables/05SOFIA1847_a.html. Bondy, C. (2013). How Did I Get Here? The Social Process of Accessing Field Sites. Qualitative Research, 13(5), 578–595. https://doi. org/10.1177/1468794112442524. Borzel, T. (1998). Organising Babylon: On the Different Conceptions of Policy Networks. Public Administration, 76, 253–273. Bozhidarova, V., Kolcheva, V. & Velinova, R. (2002). Politico-Administrative Relations in Bulgaria at Central Government Level. UN Panel. link: http://unpan1.un.org/intradoc/groups/public/documents/nispacee/ unpan005794.pdf, last accessed 29.09.2018. For an earlier version of the same paper, see Bozhidarova, V., Kolcheva. & Velinova, R. (2001) Chapter 5: Politico-Administrative Relations in Bulgaria, in Verheijen, T. (ed.) (2001) Politico-Administrative Relations: Who Rules? NISPACEE (The Network of Institutes and Schools of Public administration in Central and Eastern Europe): Budapest, http://www.nispa.org/files/publications/ ebooks/Politico-Aministrative-relations-Who-Rules-2016.pdf, Last accessed 29.08.2018. Braguinsky, S. (2009). Postcommunist Oligarchs in Russia: Quantitative Analysis. Journal of Law and Economics, 52(2), 307–349.

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Index

A Appointment, 11, 31, 33–35, 37–40, 51–53, 56, 66, 69, 71, 73, 80, 100, 111, 127, 128, 135, 145, 149 B Biased pluralism, 124–126, 141, 154, 158 C Campaign, 15, 16, 45, 47, 50, 51, 53–55, 59, 65, 66, 74, 80, 113, 114, 131, 136, 143, 144, 148, 159 Campaign funds, 15, 49, 50, 53–56, 59, 98 Catholic Action (CA), 2, 95 Circle, 50–53, 55, 62, 81, 96, 104, 108, 111, 130, 134, 150, 151, 156 Civil service, 1, 2, 3, 7–9, 11, 12, 15–17, 19, 29–35, 39–45, 47–50, 56, 60, 62, 63, 68, 69, 71–74,

77–80, 87, 90, 92, 93, 95, 97, 99–103, 105, 108, 111, 112, 115, 119, 120, 127–134, 144, 145, 147, 149–151, 153, 156, 159 Clan, 127–129, 136, 145, 148, 156, 157 Coerce, 17, 79, 81, 98–100, 103, 159 Coercion, 13, 17, 18, 79, 85, 99, 104, 105, 107, 112, 113, 116, 120, 129, 131, 132, 135, 143–145, 149–152, 155–157 Competition, 3, 4, 17, 18, 29, 60–62, 64, 65, 74, 78, 79, 81, 84, 86, 87, 93, 97, 99, 113, 115–118, 121, 123, 125–128, 130, 133, 134, 137, 143–145, 151, 153–155, 157–159 Competitive Authoritarianism (CA), 124, 131, 136, 137, 139, 140, 157, 158 Consolidated oligarchy, 4, 17, 18, 116, 118, 119, 123–126, 130, 136, 139–141, 143, 145, 156–158, 160

© The Editor(s) (if applicable) and The Author(s) 2019 M. Petkov, Oligarchic Party-Group Relations in Bulgaria, https://doi.org/10.1007/978-3-319-98899-3

181

182  Index D Democracy, 3, 15, 101, 102, 115, 118, 128, 133, 136, 137, 139, 155, 158 E Economic competition, 129, 145, 156 Elite, 12, 14–19, 22, 23, 25, 29, 30, 48, 56, 74, 77, 79, 80, 93, 96–100, 103, 107, 109, 111, 113–120, 123–125, 127, 128, 130–135, 138, 139, 143, 145, 149–151, 153–155 Extended parentela, 3, 4, 14, 16–18, 24, 25, 29, 78, 92, 97–99, 103, 105, 107, 108, 110–120, 123–127, 129, 133, 135, 140, 142, 144, 145, 149, 151–160 G Group, 2–7, 9, 11, 14, 15, 17, 19, 22, 24, 29, 31, 41–51, 53, 56, 59, 63, 66, 68, 74, 77–81, 86, 87, 89, 91, 92, 95–102, 104, 106–114, 118–120, 123, 124, 127, 133, 135, 139–143, 147, 148, 152, 154, 157, 159 I Influence, 8, 12, 29, 37, 39, 42, 48, 49, 60, 63, 66, 67, 70, 73, 80, 87, 102, 103, 105, 110–113, 125, 130, 156 Informal group, 14, 16, 97, 114, 117, 124, 125, 128, 139, 140, 143, 150, 152, 155, 156 Insider, 1–3, 6–13, 16, 17, 22, 25, 30, 31, 34, 40–43, 45, 47–50,

53, 56, 59–61, 63, 67–70, 74, 77–80, 84, 86–88, 92, 95, 97–99, 101, 102, 104, 106, 107, 111, 112, 114, 116, 119, 124, 127, 129, 130, 136, 139, 141, 142, 147, 148, 150–152, 154 Interest group, 1, 2 Interfere, 11, 15, 29, 40, 47, 61, 70, 73, 74, 100 Interference, 11, 31, 40, 60, 61, 65, 68, 69, 74, 78, 97, 134 Intermediary, 23, 50–52 Iron triangles, 8, 47, 108 Issue network, 7, 9, 10 J Jordan, G., 4, 7–9, 24, 44, 141 K Kopecky, P., 31–35, 39, 40 L La Palombara, J., 2–4, 7–9, 11–13, 16, 18, 19, 21, 22, 24, 25, 29, 30, 40, 47, 56, 63, 68, 73, 77, 79, 80, 92, 95, 96, 118, 119, 147, 152, 153, 159 M Mair, P., 35, 117 Model, 1, 4, 12, 14, 15, 18, 24, 25, 29, 49, 56, 89, 92, 95–97, 103, 113, 114, 119–121, 123, 124, 135, 140, 144, 145, 151, 153, 155, 156, 158, 159

Index

N Neo-patrimonialism, 124, 138–140, 157, 158 Non-policy-making, 14, 25, 143, 147, 148 O Offer, 12, 14, 35–37, 60, 63, 65, 82–84, 86, 113, 138, 150 Oligarchic model, 4, 29, 74, 79, 99, 154, 157 Oligarchy, 3, 4, 9, 11, 17, 96, 97, 103, 105–113, 116, 118–120, 126, 135, 136, 139, 141–143, 148, 151–153, 156, 159 Opposition, 42, 43, 46, 78, 102, 108, 120, 130–133, 135, 137, 138, 144, 155, 156 P Parente, 2, 16, 17, 74, 78, 79, 81, 89, 93, 97, 98, 102, 107, 113, 118, 119, 124, 125, 149, 150, 154 Parity, 30, 31, 47, 56, 116 Party, 1–4, 7, 9, 11–17, 19, 20, 24, 25, 29–35, 37–56, 59–74, 77–92, 95–121, 123–131, 133–138, 140–145, 147–159, 162–165 Patronage, 11, 16, 31–33, 35, 44, 60, 69, 73, 98, 99, 111, 119, 131, 134, 138–140, 150, 151, 157, 158 Pluralism, 124–126, 141–143, 154 Political appointment, 2, 15, 30–41, 47, 68–70, 72, 73, 79, 80, 92, 93, 97, 99, 103, 112, 113, 119, 127, 147 Political competition, 124–126, 133, 139, 140, 144, 145, 155, 156

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Political opposition, 15, 99, 112, 114, 133, 134, 149 Power, 5, 6, 8–12, 15–17, 30, 31, 34, 35, 37, 38, 40, 44, 47, 49–52, 54, 56, 66, 67, 71, 73, 79, 81, 82, 86, 91–93, 97–103, 105–113, 115–117, 120, 124, 128, 130, 131, 134, 135, 137–143, 147, 149, 151, 154, 157–159 Pressure, 14, 16, 46, 66, 74, 79, 81, 82, 87–92, 97, 102, 107, 115, 140, 145 Primary venue, 6, 7, 10, 30, 31, 40, 47 Public Tender Committee (PTC), 68–71, 73 S Spirova, M., 31–35, 39, 40 T Type two dynamic, 85, 90 Type two parentela, 14, 17, 24, 25, 29, 74, 78, 79, 83, 88, 89, 91, 92, 96, 98, 118, 126, 131, 135, 144, 145, 151, 152, 154, 155 U Unionist party (UP), 95 V Venue scope, 6, 7, 30, 31, 40, 41 Y Yishai, Y., 7, 13, 152