Mohawked Prince Channels Sex Pistols in Czech Elections

Bloomberg: Karel Schwarzenberg, a bow-tied 75- year-old prince whose estate includes castles and forests, is channeling the Sex Pistols in a bid to be Czech president.

Schwarzenberg has emerged as the surprise challenger to ex- Premier Milos Zeman in the nation’s first direct election for president. Campaign images created by artist David Cerny, portraying the prince in a mohawk hairstyle fashioned after the U.K. punk band and screaming “Karel is Not Dead,” are appealing to voters generations younger than the candidate.

“He represents the better, modern side of our nation,” student Klara Dvorakova said late Jan. 14 after Schwarzenberg leftMlejn, a smoky pub in a historic mill near Prague Castle where he often grabs a beer alongside young supporters in T- shirts sporting his mohawked image. “He’s noble, elegant.”

His advance to a Jan. 25-26 run-off vote highlights a rift in the former Soviet satellite. A recession and corruption are fueling support for the political heirs of late President Vaclav Havel’s Communist-era jailers, who have endorsed Zeman. Schwarzenberg, a former Havel aide, wants to bolster U.S. and European Union ties after a decade under President Vaclav Klaus, a euro skeptic seen by critics as too warm with Russia.

Havel’s Legacy

Schwarzenberg represents a “continuation of Havel’s legacy, which contains much deeper values than just the battle between left and right,” Jiri Pehe, a former Havel adviser, said by phone. “This includes representing the Czech Republic abroad with dignity, attention to human rights, and much less desire, compared with Klaus, for dividing Czech society.”

Besides holding the sole right to name central-bank board members, the president picks the leader to form a Cabinet after elections. That’s often a key role in a country where balloting frequently fails tor produce a majority. The president also has a bully pulpit to influence policy.

The Czechs this year are due to award their biggest public tender ever, a $10 billion contract to build reactors at the Temelin nuclear plant. U.S.-based Westinghouse Electric Corp. and a consortium led by Russia’s Rosatom Corp. are vying for the deal.

Schwarzenberg, who is currently the foreign minister, discussed the issue last month in Prague with Secretary of State Hillary Clinton, who said the Czechs should diversify their energy sources away from Russia and that Westinghouse offers the best safety guarantees. Zeman has said the Russian-led bid doesn’t threaten Czech security and Klaus welcomed the proposal as it offered work to Czech suppliers.

Pussy Riot

Schwarzenberg, who hasn’t tipped his hand on the issue, is a keen promoter of closer ties with the U.S. and human rights. He supported members of Russian punk band Pussy Riot last summer when they were convicted for a stunt against President Vladimir Putin and said Premier Petr Necas’s view that backing the group may hurt Czech exports to Russia was “shocking.”

His foreign outlook has shaped his fondness for Mlejn, whose owners organized a campaign to support a Bush administration plan to install part of a missile-defense network in the Czech Republic.

In 2008, Schwarzenberg took Condoleezza Rice, then U.S. secretary of state, to Mlejn to meet the system’s supporters. President Barack Obama scrapped the plan a year later as part of his “reset” of relations with Russia.

Mohawk Images

Mlejn’s walls are full of photos of Schwarzenberg, including one with the late U.S. rock starFrank Zappa, a favorite of Czech anti-communist dissidents like Havel.

Cerny, the artist behind the mohawk images, was there on Jan. 18 a few steps from Tomas Sedlacek, chief economist at CSOB AS in Prague. Cerny won notoriety when his sculpture “Entropa,” parodying stereotypes of the EU’s 27 nations, was installed at the European Commission in 2009.

“This place is full of artists, writers, creative people, all Schwarzenberg supporters,” Sedlacek said. “I’m probably the only economist here.”

In an effort to reach out to the generation born after the fall of communism two decades ago, Schwarzenberg is mobilizing voters with updates on his pages on Facebook Inc.’s social-media website and Twitter Inc.’s network. A recent post said about 700 bars and restaurants joined the campaign “Pubs Vote for Karel.”

Candidate Slammed

With the country mired in its second recession since 2009, austerity policies have been a focus of the race. Zeman, 68, a former Social Democrat leader who forged a grand coalition in 1998 with Klaus’s center-right party, has slammed Schwarzenberg for backing tax increases and cutting spending on public wages.

The government credits austerity policies with helping cut borrowing costs to record lows. Theyield on the 5-year state bond fell 172 basis points, or 1.72 percentage points, last year, the biggest decline in a decade. The rate was 0.84 percent today, according to generic data compiled by Bloomberg.

Klaus, who often clashed with Havel, has said that his successor should be a person who spent his life in the country, a swipe at Schwarzenberg whose aristocratic family was forced to leave to Austria when communists took over in 1948.

Klaus’s second and final five-year term ends in March. As Europe’s debt crisis raged last year, he refused to back the creation of a permanent bailout fund. If elected, Schwarzenberg has indicated he will support it.

Rarely seen without his trusty pipe, Schwarzenberg refuses to discuss his family’s assets, which include Vienna’s Schwarzenberg Palace and Orlik Castle in southern Bohemia. His estate earned income of about 13 million koruna ($676,000) in 2011, according to a parliamentary filing. As president, he would make about 2.2 million koruna annually.

Too Close

After Schwarzenberg defied the polls to finish a surprise second in the first round, the race appears too close to call. Oddsmakers at the largest Czech betting companies initially saw the prince as the favorite, though the odds reversed today, putting Zeman ahead. He also trailed Zeman, 46 percent to 54 percent, in a poll of 1,061 Czechs published on Jan. 18 by Ppm Factum Research company, which gave no margin of error.

Even if he does win, the prince won’t stop going to his favorite pubs, said Jakub Niemiec, manager of Malostranska Beseda, a restaurant near parliament that Schwarzenberg often frequents. “I have no doubt he’ll keep coming, even if he’s elected.”

Czechs voted today in a presidential runoff with the leading candidate opposing the government’s economic program as the minority administration extends its austerity measures amid a recession.

Former Prime Minister Milos Zeman was favored in opinion polls over Karel Schwarzenberg, the millionaire prince and foreign minister who’s promoting closer ties with the European Union after a decade under Vaclav Klaus, a critic of the bloc and the euro. Two days of voting ended at 2 p.m. in Prague and results were expected within hours.

As the eastern EU member of 10.5 million struggles to exit its second recession since 2009, government deficit cuts were the campaign’s focus. Zeman criticized his opponent for backing increases in sales taxes and an overhaul of the pension system.

“There’s a bit of a ’Sarkozy-Hollande’ feel to the Czech presidential contest, with Mr. Zeman positioning himself as the anti-austerity candidate at a time of economic malaise,” Nicholas Spiro, managing director of Spiro Sovereign Strategy in London, said in an e-mail. “But unlike the French presidency, the Czech head of state’s powers are much more circumscribed given the role’s largely ceremonial character.”

Voters will elect the ex-communist EU member’s third president since the country gained independence 20 years ago. Klaus, an economist who as premier oversaw the transition from a centrally-planned to market economy two decades ago, replaced the late Vaclav Havel in 2003 and is forbidden by law to seek the post again.

Austerity Benefits

The government credits its austerity measures with helping to cut borrowing costs. Yields on five-year koruna notes fell 172 basis points, or 1.72 percentage points, in 2012, touching a record-low 0.66 percent on Dec. 27. The five-year rate stood at 0.87 percent yesterday, according to generic rates compiled by Bloomberg.

The president, who until now had been elected by lawmakers, selects the leader who attempts to form a government after elections and influences monetary policy by holding the sole right to name central bank board members. The position’s powers haven’t changed under the new voting system.

Zeman, 68, and Klaus were rivals in the 1990s, heading the two largest political parties. Zeman, an economist who worked as a forecaster in the academy of science after the fall of communism in 1989, won the premier’s office in 1998 when his Social Democrats formed a minority government that ruled in an agreement with the opposition Civic Democrats, then led by Klaus.

More Investment

His economic program for the presidential race included calls for more state investment and restoring progressive taxation for higher earners. He has opposed Premier Petr Necas’s pension overhaul, a program designed to boost private retirement savings that was among reasons cited by Standard & Poor’s when it lifted the rating on the country’s debt two steps to AA-, its fourth-highest investment grade, in 2011.

Zeman said he would name central bankers who support economic growth and not strive only to meet the inflation and currency-stability goals mandated by law.

The run-off vote comes as a recession and corruption fuel support for the political heirs of Havel’s Communist-era jailers, who endorsed Zeman. Schwarzenberg, a former Havel aide, wants to bolster U.S. and EU ties and advocates human rights across the globe.

Pussy Riot

He supported members of Russian punk band Pussy Riot last summer when they were convicted for a stunt against President Vladimir Putin and said Necas’s view that backing the group may hurt Czech exports to Russia was “shocking.”

Schwarzenberg, whose estate includes castles and forests in the Czech Republic and Austria, defied the polls to finish a surprise second in the first round. Campaign images created by artist David Cerny, portraying the prince in a mohawk hairstyle fashioned after the U.K. punk band and screaming “Karel is Not Dead,” appealed to voters generations younger than the candidate.

While the largest Czech betting companies initially made the prince the favorite, the odds reversed this week. Zeman also led in the only opinion poll published between the two election rounds, 54 percent to 46 percent for Schwarzenberg. The survey by Ppm Factum Research company was taken among a representative sample of 1,061 Czechs and published Jan. 18.

Schwarzenberg sparked a wave of fresh publicity yesterday by failing to follow the required procedure while voting. He cast his ballot without placing it first inside the obligatory envelope, invalidating his own vote, the public Czech Television channel reported, citing spokesman Marek Prazak.

reporter on this story: Peter Laca in Prague