Transformacija iz nacionalne u tržišnu državu zahtijeva novi pristup reguliranja odnosa centralne vlasti i lokalnih vlasti
The Transformation from National to Market State Demands a New Approach to the Regulation of the Relationship between the Central Authority and the Local Authorities

Summary/Abstract: The objective of the paper is to indicate the wider context that should be taken into consideration when conducting a reform of the existing system of relationship between the local authorities and the central authority. The paper identifies not only the limitations, but also the possibilities available to the holders of the reform of the relationship between the local authorities and the central authority. Furthermore, the paper particularly stresses the necessity of respecting the relationship of the system towards the subsystems and the elements thereof as a necessary prerequisite for the introduction of a new system of satisfactory entropy level. The share of public income exceeds the tax capacity of the Croatian economy. Since, on the one hand, the existing tax pressure is unsustainable, it is, on the other hand, necessary to considerably increase the share of the local administration and self-administration in the income collected from taxes. By becoming a member state of the European Union, Croatia has waived one part of its national sovereignty. Abandoning national sovereignty in general redefines the system and the politics, which for its part makes the existing relationship between the central authority and the local authorities counterproductive. In order to reduce development-related differences among counties, and to secure the minimal standard of public goods for all citizens, it is necessary to establish a new system starting from the market state. The existing system regarding the relationship between the central authority and the local authorities was unsatisfactory in the circumstances of the national state. In a market state, it is unsustainable as such. In a market state, counties ought to take over the responsibility for the development of economy in their areas in order to 1) increase tax capacity that 2) enables a larger quantity and diversity of public goods. Though introducing economic principles into specifying the relationship between the central authority and the local authorities does not mean giving up interregional, interpersonal and intergenerational solidarity, their relationship ought to be based on the principles of competitiveness growth, as a foundation of the survival and development of any market state. The paper proposes a change in the approach to observing the problems, and the manner of solving economic issues at state level; possible solutions regarding the relationship between the central authority and the local authorities may thereby be observed and derived in order to actualise the necessary public goods within democratic processes, whereby the public sector should not jeopardize the competitiveness of the economy. The paper furthermore stresses the need to define the minimal standard of public goods at state level ensured by the central authority, accompanied by stimuli (including the intervention-related ones) granted by the counties, which are meant to accelerate the development and present the starting point for the equality of all the citizens of Croatia.

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