Well, it looks like the government's found a loophole to keep the zero corporate tax regime in Estonia and still be in accordance with EU directives - if only just. At the same time they've passed a bill raising excise on fuel, alcohol and tobacco, among other things. All in all, while the income tax will keep falling to 18% (and somehow I'm getting the feeling that's as low as it will go), and additional tax breaks for families with young children are introduced to bolster population growth, a lot of the extra money will be eaten up by the cascading price increases. The point is to cool down the economy - stop discretionary spending, reduce consumer & long-term debt, and prevent the bogeyman that is a "hard landing". I've yet to see a good explanation of this nasty phenomenon, but apparently it'll cause everyone to lose their homes.
Edward Lucas says that we're doing better than most Eastern European countries, because we have a budget proficit (this is a legislative issue, the government is not allowed to spend more than it gets). If you're in the mood for a cheeky chuckle, enjoy master Lucas's elaboration, of high importance to readers of The Economist: quoting "Juliet Sampson of HSBC, a bank."
Now that the economy's sorted, or at least there's a plan of action, we can go on to the next big issue: traffic deaths. Over a hundred people have bitten it on the roads in the first half of 2007 (and somewhat surprisingly for those who know me well, I wasn't among them). This is a major problem now, and a very public one. The reasons are mostly to do with the gung-ho attitude of drivers being inappropriate for the twisting, occasionally dilapidated, all too often slippery highways of this heavily-forested country. The government is getting drastic: besides the standard talk of increasing fines and introducing a point system, they've gone ahead and purchased a bunch of speed cameras. In this first phase they've only got enough hardware to cover about 80km of road, apparently, but if the gatsos are effective, there will be more.
I'm not sure how I should feel about it. As a car enthusiast, I am bound to finding speed cameras repulsive. On the other hand the highway traffic really is getting quite bad. There's a time and place to drive fast, and the behaviour of many drivers on the Tartu-Tallinn road* is quite simply imprudent. Having survived several highway mishaps, I now prefer to stay within reasonable proximity to the speed limit. If gatsos really are an effective deterrent, and if they'll not just be used as revenue generators, I can't in all honesty complain.
There are, however, sillier ideas going around. Reader letters in Postimees have suggested mounting a speed limiter on the cars of rookie drivers and repeat offenders, physically preventing the car from breaking the speed limit - this ties in to the EU idea of banning cars capable of going faster than 160km/h. The problem is that this is presents a safety concern: in some situations, you need power to pull off a maneuver safely, and an arbitrary engine limiter could very well put you in harm's way.
In Tallinn**, they're thinking of reducing the speed limit to 40km/h. Now, a basic principle of legislature is to not pass laws that cannot possibly be enforced. The traffic speed in Tallinn today is more organic than prescribed; very few drivers follow the 50km/h limit unflinchingly. If all the cars around you are travelling at 70km/h, you'd better do it too. Reducing the limit would achieve no more than criminalize the population, which would do nothing for safety, but would generate resentment. Bad idea.
The only things I can think of that would seriously improve traffic safety are road construction - freeways especially, as it's rather difficult to kill yourself in city driving (although there are bright sparks who've managed) - and saturation of the traffic flow with police presense. To the best of my comprehension, raids on the Tallinn-Tartu road during peak hours, when you'll see five or six squad cars over the length of your trip, have been effective. There's no need to enforce the letter of the law rigorously and punish people harshly for every minor infraction, but the mere presense of traffic police in the flow at all times should do wonders. Estonians are sufficiently civilized that they won't break the law while the police is watching. ;)
* The road I'm most familiar with, and the major artery in the country. They're doing things to it - diverting heavy trucks during peak hours, extending the autobahn-style separated sections, etc. Curiously enough, while dangerous, it is not responsible for most of the fatalities - people kill themselves a lot more on country roads. There's a known phenomenon with twisting mountain passes, that it's statistically a lot better to not put up any barriers at the edge of the road - drivers who are scared shitless will drive more prudently and get through safely. The appalling traffic of this freeway probably acts as a similar inhibitor.
** I'm too tired to think of a way to convincingly blame this on Edgar Savisaar, so use your imaginations.
A tale of two countries
5 weeks ago