People wait months in queues to see a doctor because the quotas have run out (the state has no money)...
Schools, fire stations and post offices are being closed due to a lack of funding, there are insufficient resources for road repairs, there is no money for that...
Unfortunately, messages of this kind, the main point of which is that there is no money, have become a daily occurrence in the media and in the statements of politicians and officials at all levels. There are many problems, they need solutions, but... there is no money. We can only hope for the resolution of today's pressing issues in 2025. This is a daily reality that must change!
Nearly 34 years after the restoration of Latvia's independence, we are living in a near-constant whirlwind of reforms and problem-solving, while our neighbours, as various sources suggest, have surged far ahead of us. How so? It is harsh and unpleasant, but it seems that with the current attitude and capacity of the public sector – politicians and officials – we will be unable to move forward rapidly and decisively. Perhaps we don't need to? Are we really going to boast about being in third place in the Baltics?!
Latvia is a member state of the European Union, the movement of labour is free, and our people are building and developing the economies of Ireland, Germany, Great Britain, as well as Estonia and Lithuania, while contributing to the treasuries of those countries. Employers complain about a shortage of labour, more than one school is now desolate because there is no one left to attend it, and service providers and retailers are “shrinking” because of a lack of buyers and consumers. Is this “shrinking” still an objective way of overcoming the consequences of the Soviet legacy? In the three decades since the restoration of Latvia's independence, can the Soviet system, which has long since ceased to exist, still be blamed for our problems (long queues for doctors, the elimination of jobs, new restrictions on economic activity, and excessively servile bureaucracy (which, apart from its “creators”, no one needs))? That is an answer worthy only of empty talkers. Should the country be turned into some kind of reserve where more things are forbidden than allowed?!
To achieve what was listed at the beginning of this article, funding is and will be required. Money “comes in and remains” in the state purse from the taxes paid by entrepreneurs and residents, as well as from various types of EU co-financing. No one has promised that co-financing for Latvia will last forever, and it must be remembered that those providing it set requirements that consume time and resources. It would be more useful to use both time and resources to create value. Public administration in Latvia must understand and accept what the officials and politicians of Estonia, Lithuania, and Western European countries understood long ago – what the public can afford to spend, and how much (if anything), depends on the success of entrepreneurs and their actions within the environment shaped by politicians and officials. The more effectively entrepreneurs invest and work, the more people they will employ, the higher the added value they will create in each workplace, and the greater the ability of entrepreneurs to pay higher wages and taxes, which in turn sustain the state and fund what is necessary for society – education, healthcare, security, etc.
It must be taken into account that the state collects a large portion of the wealth created by employees, entrepreneurs and the self-employed in the form of taxes to pay salaries for those employed in the state and municipal sectors and to carry out other tasks. For the state to be able to spend, it must first create what is to be spent. Without that, we will not be able to buy trains, maintain an army, look after our security, or help Ukraine. If entrepreneurs do not create this wealth, there will be no funds!
The time has come to stop viewing entrepreneurs as undesirable and to stop cultivating myths about entrepreneurs being tax evaders, crooks and fraudsters. Instead, we must think about how to attract domestic and foreign investment that would create new jobs with higher added value, as well as exportable products and services. We need simple, or perhaps complex, solutions that would make the business environment in Latvia both attractive and competitive throughout the region.
It seems the very first and most essential task would be to identify the decisions, requirements, guidelines and regulations that are destroying or hindering the competitiveness of Latvia’s business environment, followed by their dismantling, cancellation or significant easing. We must not introduce new measures that restrict or prohibit business sectors, as these will undoubtedly provide opportunities and advantages to competing countries. Since it is very naive to cherish illusions about attracting very large-scale foreign investment in the current geopolitical circumstances, we must talk to entrepreneurs who are already operating here (both local and foreign) and understand exactly what is hindering faster development and what the state must do so that entrepreneurs invest in expanding existing facilities or building new factories.
If we do nothing or continue to look for reasons why we cannot do something in Latvia, we will have to reconcile ourselves to a stable position in the rear-guard of the EU, where there will be even less money to fund the services society needs, and living on credit in the long term will be impossible.
Entrepreneurship must not be pitted against teachers, doctors, firefighters and vice-versa, because that is how those in power act when they favour the principle of divide and rule. Turning different social groups against each other, as they try to fight or restrict one another, is the best way to hold onto power. If everyone were to collectively turn against the decision-makers and the idiotic implementation conditions, those sitting on the Olympus of power would have to vacate their comfortable seats.
New bans and restrictions on economic activity in land management will reduce not only the number of employees but also the total population of the country. If there are no alternative jobs, at least for now, this will mean yet another “shrinking” of an already thinly-populated Latvia. Consequently, there will be less demand for the work of firefighters, police officers and librarians, and tax revenues will also shrink. The fewer consumers there are, the more the “remedy” for the lack of money in the state purse will be increased tax rates, new and unprecedented taxes, or the cancellation of existing tax relief. The fewer inhabitants there are, the higher the costs for electricity, gas and road infrastructure that those remaining will have to cover! Which of these solutions do you like best?!