A Czech Billionaire Suffers From Some Trump-Like Problems

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Andrej Babis Photographer: Martin Divisek

Like Donald Trump across the Atlantic, a populist billionaire in Europe is discovering that exercising power is no easier than winning elections. Andrej Babis, the Czech tycoon who has drawn comparisons to the U.S. president and to former Italian Prime Minister Silvio Berlusconi, has failed to form a ruling alliance after his euroskeptic ANO party dominated October elections. He’s now trying to muster support for a minority cabinet. That could mean more political instability in a country where only one government has survived a full term in that last 15 years.

Andrej Babis, Oct. 23.

Photographer: Michal Cizek/AFP via Getty Images

1. What explains Babis’s post-election struggles?

Since his party didn’t win an outright majority, Babis has had to try to seek coalition partners -- to no avail. One big problem is that Babis is facing a criminal fraud investigation. He also fended off accusations during the campaign of having conflicts of interest stemming from the chemical, food and media empire with which he made his $4 billion fortune. And he’s depicted traditional parties -- the ones he would need as partners now -- as corrupt and incompetent. Babis stormed the country’s political stage four years ago, when ANO was the runner-up in general elections. (ANO, an acronym for Action of Dissatisfied Citizens, means “yes” in Czech.)

2. What could come of this fraud investigation?

Less than a month before the election, Czech police filed criminal charges against Babis over the alleged misuse of European Union funds at a recreation center belonging to one of his businesses. Babis says the case is fabricated and an attempt to stop him from taking power. Winning a seat in parliament has renewed Babis’s immunity against prosecution, meaning lawmakers would have to vote again to allow new charges, if the police request it.

3. Does Babis have any allies?

He’s won unconditional backing from President Milos Zeman, who shares Babis’s opposition to allowing anybody who claims Muslim faith to settle in the Czech Republic. The two leaders also have in common a disdain for traditional political parties, media and what they call urban elites detached from real-life problems. All that resonates with a large part of the population despite a booming economy and the lowest unemployment rate in the EU. Zeman and Babis have both also called for the bloc to scrap its sanctions against Russia. By law, Zeman can bestow up to two consecutive mandates to prospective prime ministers; he’s vowed to give Babis both, if needed.

4. How long can a minority cabinet last?

There is no deadline to muster a parliamentary majority. Once the full cabinet is appointed, which is expected after Nov. 20, it will have 30 days to survive a confidence motion. Also, the head of state can technically take as much time as he wants to before granting the second mandate if the first prime minister fails. Zeman, who himself is seeking re-election in a January ballot, relishes what he calls a “creative interpretation” of the constitution. He broke from political tradition four years ago by keeping a hand-picked technocrat administration in power for months without parliament’s approval.

5. How could a minority government get things done?

Whether Babis wins or loses the confidence motion, he’ll have to seek ad-hoc support for legislative proposals. This is where he can use his experience in bargaining. He built his business mainly through a string of acquisitions to create a conglomerate of more than 250 companies employing about 34,000 people in 18 countries. While all parties except for the Communists have ruled out supporting a minority cabinet, Babis is luring other parties with pledges to include parts of their agendas in his government program.

6. Could there be early elections?

The Czech Republic has held snap ballots before. The latest example was four years ago after the collapse of a center-right administration. But early elections now appear unlikely, at least until all mandates to form a government are spent (In addition to Zeman’s two picks, the head of parliament can grant third mandate if the first two attempts fail. Babis’s ANO is seeking the speaker’s post). Some parties that suffered the most in the October ballot might not be willing to contest elections again, because of a high risk they may do worse or even miss the required 5 percent threshold.

The Reference Shelf

  • A QuickTake explainer on Babis’s political platform and his rise to power.
  • The IMF’s June 2017 report on the Czech Republic’s economic health.
  • A story on ruptures in the European Union.
  • The constitution of the Czech Republic.

— With assistance by Ladka Mortkowitz Bauerova

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