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First, without knowing it, it would be difficult to guess which party or ideological leadership developed this program. Some would even call it eclectic, without a strict and obvious ideological backbone. In this case, however, the mosaic of green, conservative, liberal and social democratic values is an advantage rather than a disadvantage: the program emphasizes the intention to seek compromises, cooperate without leaving anyone and reconcile the interests of all sectors of the community. society.
Those who lack a strong ideology might remember the definition proposed by the Germanist American writer Erik Jarosinski: an ideology is a false belief that their faith is not false nor is it faith.
Second, the program sets measurable goals and criteria not only until 2024, the next Seimas elections, but by the end of the decade. To some, this may seem like an unfounded ambition to stay in power, but this innovation must be seen as an attempt to go beyond a political cycle.
The program establishes measurable objectives and criteria not only until 2024, the next elections to the Seimas, but by the end of the decade.
Many of Lithuania’s long-standing problems cannot be solved in a few years, and the results of its decisions, such as increasing healthy life expectancy or improving student achievement due to better and more accessible preschool education, may not be evident until the end of the decade. Such practices could also be followed by future governments, in which case the country’s development success indicators established for a decade would not have to be forecast every four years, but would be sufficient to update and complement them.
Third, one of Lithuania’s oldest and most sensitive problems, the weakened education system, is being addressed through a national agreement that will allow for smoother and faster implementation of reforms. Two years ago, all parties managed to sign an agreement on the financing of national defense and the Lithuanian defense policy guidelines. It would be strange and sad if such an agreement could not be reached on the basis of education, which certainly contributes no less to national security, independence and prosperity.
To address one of Lithuania’s oldest and most sensitive problems, the decaying education system, a national agreement is being sought that will allow for faster and smoother implementation of reforms.
The government’s program contemplates educational reform from its roots, that is, from preschool to fruit, and lifelong learning. Early childhood education, which is of particular importance in families at social risk and on whose quality academic and professional success depends, is not yet universally available or of sufficient quality.
The well-being and performance of students are not guaranteed by a dense network of schools, therefore the intention to abandon the legacy of the last century: joint classes and create a rarer network of good schools accessible to all is welcome.
This year’s math test, which was not passed by one in three graduates, had to be opened, and in some schools, only one in three passed.
The OECD Student Ability Survey shows that we are leaders in our region in terms of the number of students not meeting minimum skills; in some smaller schools, their share reaches 42 percent. This year’s math test, which was not passed by one in three graduates, had to be opened, and in some schools, only one in three passed. It is a pandemic that started in the last century and will not end next year, so it requires more than the attention and effort of this government.
Fourth, there is no intimidation or unsustainable promises on the fiscal front. On the contrary, it is emphasized that the tax system must be compatible with the need for public spending. In the past, commitments to increase public funding have often been inconsistent with promises of tax cuts. Still, the program’s ambitious goals, from education and health to social and regional policy, mean that this will require more financial resources than the state currently has.
There is no intimidation or unsustainable promises on the fiscal front. On the contrary, it is emphasized that the tax system must be compatible with the need for public spending.
However, taxes won’t necessarily go up, especially for those who already pay a lot of them. The tax burden on employees is significantly higher than for those who formalize their economic activities differently, so it is planned to assess the justification of the benefits and address the problems of tax inequality.
Tax relief is also promised for reinvested earnings. Such an exemption is already in force not only in Estonia, but also in Latvia and Poland, so in order to increase the attractiveness of Lithuania for foreign investment, according to which we are still in last place in Central and Eastern Europe, it should not be considered for too much time.
Like previous governments, this one does not forget the problem of tax evasion and the shadow.
The program forgets, but will hopefully recall later, a similar benefit not only for businesses but also for citizen investors: legalizing an “investment account” would allow GPM to pay for capital income only when the money earned is gone. .
Like previous governments, this one does not forget the problem of tax evasion and the shadow. Reaching the specific goal of reducing the VAT gap, from 25% to 10% of how much is collected in the budget and how much must be collected, depending on consumption and the tax rate, would add more than 500 million euros to the state budget every year.
Fifth, along with more favorable tax policies, an unforgettable innovation ecosystem, the promotion of entrepreneurship, greater access to capital, deregulation, and a better business climate. “Maximum freedom to do business is a key guarantor of economic transformation and further growth,” said one of the priority projects, which includes many welcome initiatives.
However, when it comes to “bureaucratic” supervisors and constraints, we cannot have the preconceived notion that they are all bad and impede self-actualization or value creation. We must look at all prohibitions and restrictions through a clear prism: if an activity has a negative impact on the environment, the surroundings, or future generations, then certain restrictions and rules are necessary.
We have seen promising and comprehensive government programs in the past.
Freedom to act freely is not absolute, and its limits are well illustrated by a quote, sometimes attributed to US President Abraham Lincoln, sometimes to philosopher and economist John Stewart Mile, sometimes to legal philosopher Zechariah Kafe, sometimes to other public figures and thinkers. the nose of the other person begins.
We have seen promising and comprehensive government programs in the past. It should come as no surprise that this also shows the continuity of the work of some previous governments. It would be strange if, in the face of the same long-standing problems and similar challenges in the state, different governments in a democratic state dragged the country in completely opposite directions. It is true that the government program alone is not enough: from its presentation to the concrete action plan, its support in the Seimas and its implementation, there are often many sinks.
The program of the 18th government may seek and find deception, but it would be difficult to call it unambitious and without the potential to create a more open, smarter, competitive, fairer, more harmonious and healthier Lithuania. It remains to wish you good luck.
Dr. Nerijus Mačiulis is the Chief Economist at Swedbank.
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