One of the important issues discussed at the two-day EU summit in Brussels was proposed changes in the mechanism of EU decision-making, which would allow some EU members to push ahead with integration faster. For the Czech Republic, which is still outside the Eurozone, this could present a serious problem.

There is general consensus in the 27-member block on the need to improve decision-making which has at times proved frustratingly slow and inefficient, but finding the right solution is not proving easy.

The President of the European Council Donald Tusk, who drafted the proposed changes, said the need for unity must not serve as an excuse for stagnation, but neither should ambition lead to division. He said improved communication on sensitive issues was essential and ahead of important votes he would provide an overview of the points on which members agree and disagree in order to facilitate agreement. Tusk stressed that unity was essential on issues of crucial importance.

The Czech Republic welcomed his proposal that consensus-decision making should be implemented wherever possible, and EU members should always seek broad consensus before giving space to closer cooperation within a smaller group. Prime Minister Bohuslav Sobotka in particular welcomed the agreement that on some sensitive issues consensus decision making would be the rule.

“I particularly appreciate the proposal to seek consensus on the EUs asylum policy since this would give the Czech Republic and member states of the Visegrad Group the chance to say no to the compulsory redistribution of migrants.”

The prime minister said too many decisions by a select group of states would present a risk of EU fragmentation into interest groups pursuing their own ambitions and the EU hard core tailoring the rules to its own benefit.

Even now there are groups in the EU with different levels of integration and leaders such as French President Emanuel Macron have been pushing for a multi-speed Europe which would enable the countries in the Eurozone to integrate faster. The Czech Republic, on the other hand, is one of the countries with a cautious approach to the idea.

The Czech Republic is not a Eurozone member and the outgoing government has not set a time frame for euro adoption. Unless it moves fast the country could be left in the slow lane with decisions made in the EU’s hard core which would inevitably have an impact on the export-dependent Czech economy. Risks do exist for the Czech Republic in this respect, Sobotka admitted, saying it would be up to the next government to decide whether the Czech Republic should not reconsider its stand and join the Eurozone as quickly as possible.

However, in the Czech Republic scepticism to the single currency remains high and many parties have tried to boost their chances in the elections by voicing their opposition to the euro. Out of the eight parties expected to cross the 5 percent threshold needed to win seats in the lower house six said they did not want the euro for the time being or they did not want it at all. The prime minister’s own Social Democrats said they did not want to adopt the euro for the time being but paradoxically they do want to be part of the EU’s hard core.

Europe’s year of political upheaval isn’t over. In the Czech republic, a charismatic, controversial billionaire dubbed the ‘Czech Berlusconi’ – and more recently the ‘Czech Trump’ – is poised to take power.

Hot on the heels of Austria’s hard shift to the right, this weekend’s legislative election in the Czech Republic could be another shock to the EU which is still digesting the results in France and Germany, not to mention Brexit.

In his 2017 book What I Dream About When I Happen to be Sleeping, Andrej Babis set out an agenda that would transform, and some claim destroy Czech democracy.

He wants to abolish institutional checks and balances such as the Senate and regional government, he wants to ditch proportional representation and have the country vote first-past-the-post.

Read the full story in the Sydney Morning Herald.

As L. Todd Wood reports in The Washington Times the Czech Republic is on the verge of slipping back into Russia’s “iron embrace”. Excerpt below:

One of the hallmarks of the ex-Soviet countries is the reign of the self-serving elite, which evolved from the old communist “nomenklatura” — the top party cadre. Oligarchs usually run the country, skimming off the top.

Unfortunately, in the Czech Republic, powerful business interests are coming into power. Exhibit A is Andrej Babis, a very influential billionaire. His ANO party and the powerful media empire he controls are ascendant. On Oct. 20 and 21, Czech voters will choose the members of the Chamber of Deputies, which will elect the prime minister. Opinion polling suggest ANO is the country’s most popular political party, making Mr. Babis the favorite to be the next prime minister.

Mr. Babis is viewed as a billionaire media mogul who is more interested in his own business interests than in cleaning house.

Another corrosive influence is the uncomfortably close relationship of President Milos Zeman with the Kremlin. Soviet and Russian security services’ involvement in European politics is legendary. Russian President Vladimir Putin, who worked in neighboring East Germany, would like nothing better than to have outsize influence on a NATO member seen as a model for Central European success. Currently, Mr. Zeman, a sympathizer of Mr. Putin who has supported Russia’s policies in Syria and Ukraine, may be re-elected in January 2018.

Allowing Kremlin confidants into the inner sanctums of Czech political power sets a dangerous precedent. It is no secret that Martin Nejedly, chief executive of the Czech branch of the Russian energy firm Lukoil, is a close confidant of President Zeman.
Mr. Babis and Mr. Zeman could be the agents of change to move the Czech Republic away from the EU and NATO and into the Russian bear’s iron embrace. Before bringing to power a government that accelerates the decline of the rule of law and politicizes the court system further, 

Czech voters should consider the inevitable fruit of their choice. Elections have consequences. The consequences of this election could be a weakening of NATO and the EU as we know them today.

Cynthia Kroet writes in Politico that Andrej Babiš has been formally charged by Czech Police. Excerpt below.

Police filed charges against Babiš, a former finance minister, and his deputy Jaroslav Faltýnek for subsidy fraud linked to a farm and conference center nearly a decade ago. Babiš is believed to be behind a plan to acquire the EU funds that were only meant for small businesses.

PM candidate Andrej Babiš already lost his parliamentary immunity this summer. If the case is brought to court and if the men are found guilty, they face potential prison sentences.

Babiš is the leader of the centrist ANO party, which looks set to win the most votes in next week’s legislative election, according to polls, but it could fall short of an overall majority. If Babiš does become prime minister, he would again be immune from prosecution.

As Peter Laca writes in Bloomberg  Czech voters may have found their own version of Donald Trump. Excerpt below.

Like the U.S. in 2016, voters in the Czech Republic look set to hand power to a populist billionaire who attacks traditional parties and promises to run the state as one of his businesses. Andrej Babis is leading in opinion polls by a wide margin before Oct. 20-21 elections despite being a target of criminal investigation over alleged fraud — he denies any wrongdoing — as well as facing accusations of conflict of interests stemming from his chemical, food and media empire. Anti-establishment sentiment often spreads at times of economic malaise; Babis’s rise, more unusually, has come amid strong growth, record-low joblessness and robust wage increases under a coalition he’s shared with the Social Democrats.

1. What explains Babis’s rise?

The second-richest Czech, with a fortune estimated at $4 billion, Babis stormed the country’s politics four years ago, when his ANO party was the runner-up in legislative elections. (ANO means “yes” in Czech and is also an acronym for Action of Dissatisfied Citizens, the name of a Babis’s political movement.) ANO depicts traditional parties — the ones that have held power since the fall of communism in 1989 — as corrupt and incompetent. As finance minister from 2014 until his firing in May 2017, Babis got credit for overseeing an economic rally that helped cut the republic’s budget deficit – a badge of honor in a nation averse to debt and proud of its industrial heritage. One of his main initiatives forced businesses to link cash registers to the tax office via the internet, significantly improving tax compliance.

2. Won’t the criminal charges derail his campaign?

It doesn’t seem like it. Less than a month before elections, Czech police filed criminal charges against Babis over the alleged misuse of European Union funds at a recreation center belonging to his business empire. (At a 2016 parliamentary hearing, Babis said the center was owned by his children and brother-in-law when the application for EU funds was filed.) Babis calls the case politically motivated. The immediate fallout may be limited, since it’s highly unlikely that a court could issue a verdict before the election. Earlier this year, the Social Democrats teamed up with the opposition to tighten the law on conflicts of interest, forcing Babis to transfer his assets to two trust funds. The affair had a negligible impact on his popularity, and he’ll become the owner of the companies again if he leaves politics.

3. What kind of prime minister would he be?

As with any election, that depends on the strength of his prospective victory. All of ANO’s potential coalition partners reject Babis’s most radical idea — changing the electoral system from proportional to majority representation, which would require amending the constitution. Babis also proposes reducing the number of ministers in the government and simplifying parliamentary procedures to expedite the adoption of laws. He promises to streamline state management by, for instance, centralizing purchases of office supplies and limiting the use of outside contractors. Babis says he wouldn’t meddle with the judiciary, distancing himself from the kind of measures seen in neighboring Poland that sparked a conflict with the EU over the rule of law.

4. Would he try to shake up the economy?

Almost certainly not. ANO isn’t seeking a stronger state role in the economy, other than Babis’ relatively modest aspiration to assert more direct control of the government-controlled utility, CEZ AS. As finance minister, Babis stopped the Social Democrats from slapping special levies on banks and utilities. The $193 billion economy is highly resilient to government change, following a decade in which the country had five different prime ministers. The biggest industries and banks are in foreign hands and the state has largely avoided any major interference.

5. How might ANO go about forming a government?

Even the most optimistic polls for Babis indicate he will probably need a ruling partner. With as many as eight parties possibly crossing the 5 percent election threshold, building a coalition may be difficult in a fragmented legislature. Babis has ruled out cooperation with extreme parties like the Communists and the anti-immigration Freedom and Direct Democracy. Apart from that, the tycoon has been vague about a possible coalition make-up, saying only that he sees some people inside other parties that he could work with. 

6. Could he try to maintain the current coalition?

That’s one of the options. Though he calls the Social Democrats lazy and fiscally irresponsible, Babis has stopped short of rejecting future cooperation with them. After all, their ruling alliance, despite many differences and constant bickering, became the first since 2002 to survive a full four-year term. Before Babis was formally charged with a crime, President Milos Zeman had said even that scenario wouldn’t stop him from asking the billionaire to form a government if ANO wins the elections. There’s always the chance that Babis’s opponents could team up in a broad coalition to prevent him from taking power. But polls indicate it might be impossible to form a government without ANO.

7. What are the biggest risks of a Babis-led government?

Babis lacks the traditional political philosophy or ideological anchor that defines mainstream parties. He has shown he can reverse a stance if he sees a political advantage. He initially spoke in favor of joining the euro area — a move long supported by most Czech export-oriented companies — but then became a vocal opponent of the currency switch, in line with the euroskeptic views of most Czechs. While he’s critical of the EU, and blames German leader Angela Merkel’s migrant policies for opening her nation’s borders to terrorists, he isn’t seeking a referendum on leaving the bloc. He says sanctions against Russia are ineffective and opposes closer economic integration within EU.

Slovakia’s Constitutional Court has ruled there is sufficent evidence that Babiš was an agent of the StB, the communist secret police. The Slovak keeper of communist police archives has uncovered at least 12 documents outlining Babiš recruitment, under the code name Bureš, as well as extensive records of spying activities.

Thursday’s ruling means any new court action (which Babiš has pledged to launch) will play out differently. The Constitutional Court ruled that the former StB police officers whose previous statements helped clear Babiš’ name should not be accepted as evidence. The former officers were previously compromised by their own actions and can’t be relied on as objective witnesses. 

The Constitutional Court added the original case should not have been brought against the National Memory Institute, since it is only a keeper of archives and not responsible for their content or interpretation.

The ANO leader reacted quickly to the ruling, saying that he regretted that the court cases would re-start. And he suggested that the timing of the ruling, just over one week ahead of Czech elections to the lower house of parliament, was not by chance, adding that his Czech political rivals were taking advantage of their Slovak connections. 

Even if the ANO leader were found to have been a former communist secret police agent it would not disqualify him from being prime minister or a member of the government under the current Czech rules. 

Nonetheless, there were a chorus of reactions from other Czech political leaders that with such a shadow about his past, Babiš is not fit to be prime minister or a government member. Babiš also faces criminal charges for fraud in connection with European funds. Political analysts forecast this pre-election scandal will not affect the ANO’s lead in the polls.

Writing in Foreign Policy, journalist Peter Feaver argues that Russian influence is growing in the Czech Republic, with serious ramifications for the next election:

On Oct. 20, voters in the Czech Republic will go to the polls for Parliamentary elections. Opinion polls show that the anti-EU, anti-immigrant ANO party will win a convincing victory.

The Czech Republic has long been a bastion of pro-Western, liberal, tolerant, cosmopolitan pluralism. The Prague Spring of 1968 challenged Soviet domination of Eastern Europe, and the Velvet Revolution of 1989 ended it.

Never one to forgive or forget, Russia has for the past 20 years pursued a single-minded yet sophisticated counterrevolutionary campaign to roll back the changes wrought by heroes such as Czech Nobel Laureate Vaclav Havel, the playwright-president. Their covert action aims to undermine public confidence in state institutions, weaken the rule of law, and put an end to the dream of a united Europe “whole and free.”

The Kremlin has achieved stunning successes. Britain voted to leave the EU. NATO ally Turkey is now installing Russia’s most sophisticated air defense system, not compatible with the Atlantic Alliance. Far-right movements have made historic gains in France and Germany. Russian fingerprints are all over the Catalan independence movement in Spain. Governments or politicians whose interests align more closely with Moscow than Brussels have taken power in Hungary, Serbia, Moldova, and Bulgaria.

In 2017, the Czech Republic risks becoming the latest in the ever-expanding club of oligarch-riddled regimes that Russia has helped engineer. The disruptive populism promoted by Andrej Babis, the leader of the ANO party and the putative prime minister, may make the Czech Republic the latest casualty in Putin’s relentless campaign to weaken the West from within.

Babis is a billionaire who owns Agrofert group, a conglomerate of more than 250 companies spanning chemicals, agriculture, and media, valued by Forbes magazine at $3.4 billion. He served as minister of finance from 2014 to 2017, when he was fired due to allegations of tax fraud. In addition, Parliament has recommended that he be prosecuted for EU subsidy fraud.

Despite these setback, or perhaps because of them, Babis has successfully positioned himself and ANO as outside disrupters who can “drain the swamp” in Prague and return power to the people. His record as a successful businessman and manager appeals to voters, as do his calls to curb immigration, impose fiscal discipline, and limit ties to Europe. Unfortunately, the line between public good for the Czech people and private gain for Babis becomes quickly blurred in ANO’s slick campaign marketing.

The party’s close association with the president of the Czech Republic, Milos Zeman, considerably strengthens the political fortunes of Babis and ANO. Zeman has supported Putin’s intervention in Syria and endorsed Russian actions in Eastern Ukraine. He defined the Ukrainian conflict as a civil war between rebels and the state, effectively denying any Russian aggression or military presence on Ukrainian soil. Zeman opposed EU sanctions on Russia, calling them “ineffective” and “stupid.”

Zeman’s ties to senior Kremlin figures and Russian oligarchs are no secret. He is a friend of Vladimir Yakunin, former director of Russian Railways, and the former high-ranking officer of the KGB. Martin Nejedly, the CEO of the Czech branch of the Russian energy firm Lukoil, is an official adviser to Zeman.

Zeman and Babis share a strong Eurosceptic streak. Despite proclaiming support for remaining in the EU and NATO, Zeman told Czech Radio that he “will do everything for [Czechs] to have a referendum and be able to express themselves” on membership in both organizations.

A determined and relentless Kremlin is systematically dismantling the security architecture of the post-Cold War international order. Nations that were once beacons of principled resistance to tyranny — first Hungary and now the Czech Republic, are succumbing to a new form of Russian power projection: weakening from within.

In this 21st-century assault on democratic values and Euro-Atlantic institutions, there are no invading troops or tanks. Rather, the forces of subversion are less visible and subtler. They are to be seen in corruption investigations that go nowhere, or independent newspapers that go out of business, or corporate mergers without a clear money trail.

Central Europe and the Balkans are slowly but surely slipping away from the West’s embrace. This is clearly not an accident, but can it be prevented?

The United States should be neither blind nor passive in the face of this danger. America and its European allies must resolutely resist Russia’s efforts to restore the Soviet sphere of influence to the countries once behind the Iron Curtain.

Hopefully, it is not too late. And here’s a prediction: Whither goes the Czech Republic, so goes the rest Eastern and Central Europe. If the heirs of Tomas Masaryk, Aleksander Dubcek, and Havel surrender the legacy of honor, integrity, principle, and freedom that these men of greatness bequeathed to them, the forces of darkness will have won a great and strategic victory.