Europe: Death Throes


Europe is at a crossroads and its survival may depend on the route taken. It is very clear that large numbers of ordinary folk have fallen out with the concept of ever closer integration, and with mass migration. Multinational companies are advocates of the EU, according to the analysis of focus-economics.com. This body paints a bright picture of vibrant colours for the immediate future of the Eurozone.
While the few, (big boys) find it exhilarating, hundreds of thousands, if not millions, of the poor throughout the EU fear the dark and unappealing clouds. Who is right and why the divergence of opinion?
Since the crash of 2008 not a lot has changed for the poor. Unemployment remains persistently high at around 11% for the Eurozone as a whole. The only country doing well is Germany with the lowest unemployment rate in 25 years.  www.focus-economics.com/germany
In contrast France has seen its unemployed rate rise above 10% as recently as December 2016. In Italy it’s almost 12%. In Spain youth unemployment is a persistent 24%. As the economist.com points out, there is “…high unemployment almost everywhere.” (October 2016).
Therein lies a major problem and to compound it we have the arrival of significant numbers of migrants. The figures vary, according to Frontex the EU border agency 1.8m came to Europe in 2015 with an estimated further one (1) million illegal entrants. Significant numbers continue to arrive. It really doesn’t matter whether you think it is a good idea, the humanitarian thing to do, or not. The crucial point stems from the impact. And the impact has proven seriously negative for the poor.
In highlighting the negative we need only look at the UK and that 73% of local councils take few, while councils in the most affluent areas take no migrants. Whereas, places like Boston in Lincolnshire has witnessed a huge influx. In consequence 72% of the electorate voted ‘Leave’ in the referendum of June 2016. Thus the burden of coping with migration has been firmly placed in areas with a high concentration of working class people. A class issue?
It is slowly being accepted that such an influx of numbers has a direct effect on: housing, rented accommodation and the cost of rent, school places, dentists, doctors’ appointments and the NHS especially the accident and emergency (A&E) departments. The same difficulties are not a part of daily life for those who castigate the poor for stating the obvious.
Therefore, it is the poor who carry the burden of migration. The well-off and the political elite berate the poor for moaning, and are unconcerned by the growing frustration and mounting anger of the people. As a means of demeaning and controlling any outbursts from the lower classes the establishment and their luvvie bedfellows demonize them as: ‘ignorant, uneducated, stupid or racist’ as experienced by Lord King, former governor of the Bank of England. (Daily Mail 2017/02/10)
A blind adherence to their prescribed agenda by the political class and their groupie acolytes has served only to alienate millions of voters. The consequence is now obvious.
Similar patterns are to be found throughout Europe. In Germany the altruism of Angela Merkel and her subsequent rise to fame has waned considerably. When the emotional high withers the harsh reality, the practical everyday environment comes to the fore. Germany was magnanimous but the rise of opposition has increased steadily. The AfD (Alternative for Deutschland) has been growing and estimates that it can now command roughly 25% to 30% of the electorate with an anti EU policy.
Now the Social Democratic Party (SPD) with their new leader Martin Schulz ex EU President, think they can muster a campaign. The youth movement of the party JuSos are filled by enthusiasm and think they could actually steal the election in September. www.theguardian.com/      15/02/2017
However, there are more fundamental consequences as many of the migrants are now feeling trapped in camps. Thousands complain that they cannot find work and their frustration and anger grows. Those who find work are usually a source of cheap labour paid below the minimum wage. Illegal workers are simply used and abused.
Nonetheless, the true horror comes from the sheer number of single male migrants, hundreds of thousands who have needs beyond that of shelter and food. Existing brothels will not cope with the increased need and so the void is likely filled by people traffickers to help satiate the overload. In consequence, thousands of women and children will be brought in and forced to meet the demand.
The sanctimonious will continue to berate their opposition with their abusive language and remain immune to the tragedy behind the closed doors. I’ve met their friends who accompany them everywhere they go:  see no evil – hear no evil – speak no evil! It’s unfortunate but reality cannot by itself break down a fixed ideology.
Throughout Europe there is fallout from the high unemployment, the migrant crisis and the deafness of the political class. In Sweden, once considered the hallmark of social democrat achievement has fallen foul to these undercurrents. In the city of Malmo the local police have asked for national assistance to combat the steep rise in crime.
One area particularly affected is the district of Rosengard which has an 80% migrant population but less than 40% of the total population have a job. A growth in social unrest, gang warfare and multi-ethnic violence has led to eleven (11) murders, 80 attempted murders and a spate of shootings, arson attacks and bombings. Little wonder that the local guys want additional help. (Reuters)
Si se puede
Meanwhile, a Spanish member of the EU parliament (MEP), Javier Lopez has written a piece on the ‘defense of democracy’. By democracy he means the maintenance of the existing order as he abhors the “bigoted populist movements”. Along social democratic lines he is calling for the reconstruction of the EU to incorporate a fiscal branch, harmonization of taxes, a minimum income throughout the Eurozone and better public services.
Lopez believes such a programme will curtail the build-up of populism. However, his ideas will necessitate closer integration which is the opposite of what many of the new parties in the EU want. Also, the Guardian newspaper, (theguardian.com October 2014) points to political scandals and corruption as prime reasons for the existing political parties losing ground.
In his homeland of Spain, has seen the rise of Podemos (We Can) founded in March 2014 and now the second largest party in Spain with a membership of 456,000 as of April 2016. It is also the third (3rd) largest group in the Spanish parliament. The party is a strong left leaning organisation that wants an end to austerity and changes to the Treaty of Lisbon. But to Lopez’s logic all members of Podemos and all those who voted for them are ‘bigoted populists’. Unfortunately for Lopez the motto of Podemos is – se si puede – Yes We Can!
www.socialeurope.eu/2016/12/europe-globalization-unrest
Of course all eyes are on Greece at this time and whether it can meet its debt repayment plan. There is little understanding from the ‘powers’ in Brussels of the political reality in Greece. The parties that once held sway, PASOK, centre left and New Democracy could look forward to 70% – 85% of the vote at elections.
Such numbers create a self-assuredness and in consequence a relaxed approach to the everyday needs of the electorate. The vote for PASOK has fallen to 5% at points and their joint vote to 31% at the May election of 2014. It is difficult to understand how such a change can go unheeded by the Brussels politburo.
The Greek economy has fallen by 25% which is equivalent to the 1929 crash in America. The country is on its third (3rd) bailout with the forth due soon. In the summer it has a debt of €7.5bn to repay before receiving its next tranche.
There is now an open rift between the IMF (International Monetary Fund)) and the ECB (European Central Bank) over how Greece should be bailed out. The debt problem of 184% of GDP which equals some €350bn means it will find it extremely difficult, if not impossible, to pay off any of its debt. The IMF says the debt is ‘unsustainable’.
If Greece had a vibrant economy it could possibly reschedule its debts. However, the country is still in the doldrums; high unemployment, poor investment levels, poor productivity and the fact that the people don’t have a lot to spend means it’s between a rock and a hard place.
Hence the IMF wants the next bailout package to include some debt relief. But, the ECB want more austerity and are really none too happy that the Prime Minister Tsipras gave a Christmas bonus to pensioners and free school meals to children of the poor.
Now you’re aware of the priorities of the ECB and the German finance minister Wolfgang Schäuble. Of course they may argue that the poor in Greece will be better off in the longer term but that don’t help when you’re hungry now. And that don’t help if you’re a political party trying to stay in power. And that don’t help unless it’s a stone cast guarantee!
www.theguardian.com/business/economics-blog/2017/feb/05/                   (A good read.)
BBC Business News 2017/02/15
Poor Greece (literally as well as metaphorically) has suffered years of austerity. And while other nations get a boost from retail sales Greece doesn’t have that luxury. Instead it is under pressure to cut pensions again which would be the thirteenth (13th) time. Unlucky for some – no pun intended. Therefore the Greek debt problem is a headache and perhaps, that’s why the German newspaper Bild has suggested that the German government would welcome Greece leaving the EU.
www.marketwatch.com   www.taieitimes.com/news/editorials/  (2017/02/06)
According to the economist Paul Krugman forcing Greece to suffer austerity which comes with every deal, “…it’s a grotesque betrayal of everything the European project was supposed to stand for.”
https://krugman.blogs.nytimes.com/2015/07/12/killing-the-european-project/?_r=0
CIAO Italy? (chow)
Another nightmare stirring in the background readying to wake the dead is Italy. This nightmare can truly disturb the sanity of the EU: dozing, dozing, dozing; alarm! The banks are described as “…an inexhaustible source of financial instability”. Unemployment hovers around 12%. It has the highest inflation rate (Feb: 2017) since 2013. Public debt continues to rise and there is no sign as yet of any economic recovery.
Interestingly, none of the major rating agencies: Standard & Poor, Moody or Finch is prepared to give the country a rating. The reasoning may be because the country’s debt stands at 132.6% of GDP the second largest in the EU. Bonds sold to keep Italy afloat are not being bought by private investors but by the ECB. Aggressively!!
The Times also reports that Italy has gained little from the euro. The paper also claims that the poorer countries in the EU can’t reach their potential because of poor growth and poor investment. Such a scenario may have fed into the logic of the Mediobanca report that states that many parts of the EU are caught in a “mouse trap” and adds “Without a major restructuring of the Eurozone, there is nothing you can do under these rules”
. www.focus-economics.com/countries/italy   www.times.com/2017/02/08/business/
Business Insider in discussing the problems of the EU concludes that “Actually, a lack of reforms, slow growth, a troubled banking sector and high government debt in Italy may be a bigger risk for the Eurozone.” Than Greece! www.businessinsider.com
La France – la sortie?
France the second biggest economy of the Eurozone has many of its own problems. Unemployment is up above 10% again and tales of political corruption have been in the headlines for a number of years. Add migration and terrorist attacks and the government is under severe pressure.
Since Hollande came to power taxes have risen to an all-time high at 47.9%, the highest in Europe. The real indicator of the well-being of the country is summed up thus, “… no significant economic improvement over the past five years”.
In terms of trade France exports 17% to Germany but imports 19% from the Germans. Their deficit is also high, while debt stands at around 102% of GDP. That only leaves Germany with a positive outlook.
www.ndtv.com/world-news/   citing an article by Reuters 2016/12/04.
It doesn’t look promising as the IMF say that the euro is about 15% undervalued but their analysis suggests that based on the French economy it is 6% overvalued. This is a problem faced by all the economies of the Eurozone but that of Germany. How would the other nations fare if the euro was 15% higher? The alternative is to leave the EU and devalue or a complete overhaul of the EU.
The French election should be an interesting one, Emmanuel Macron standing as an independent is now running high on the polls aided no doubt by the corruption scandal surrounding Fillon the right-wing conservative candidate.
Unfortunately for the French workers Macron is proposing more austerity with a package that includes cutting pensions and severely restricting trade unions to operating at company level rather than across the whole industry. Maggie’s back in town!
Marine Le Pen seems the likely opponent of Macron. The National Front programme is to leave the euro and devalue. Or create bedlam along the way.
Generally, the economic picture is not one to win investment and the policy of austerity has proved a disaster, so much so that it has been abandoned by some countries. Therefore there is no common policy to deal with the desperately slow growth that hangs over the Eurozone like a huge dark and brooding cloud as far as the eye can see.
The chief European economist for Goldman Sachs Huw Pill suggests at best the EU will stumble along making small gains. However, he warns that the EU needs ‘institutional and structural’ changes to overcome the weaknesses of the block.  www.goldmansachs.com
A further nail in the coffin comes from the economist.com (October 2016) and their assessment that there are “…deep flaws in the single currency’s design.” Flaws in the currency have been known for some time through the work of J Stiglitz and Paul Krugman both Nobel Prize winning economists.
Having already bailed out Greece, Spain and Ireland; the question must be how long can this process carry on. How long before the moneymen run for the hills?
On the political front the EU is open to severe attack from several flashpoints. In Austria Norbert Hofer of the Freedom Party lost the presidential election by a mere 0.6%. The latter is far-right politically as is the AfD in Germany and other such movements have sprung up in many areas of the EU.
Austria’s new chancellor Christian Kern has made it abundantly clear that he expects the Eurozone to make big changes. He at least recognises that the writing is on the wall unless the people’s wishes are given a hearing.
The Danish People’s Party has increased its vote by 50% in eight years. In the Netherlands the far-right party of Geert Wilders the PVV with its anti-EU stance could possibly win in the next election. In Italy the Five Star Movement (M5S) has gained the mayor ships of Rome and Turin and is polling nearly 30% of the electorate. www.theguardian.com/world/2016/may/25/
Just over a year ago Martin Schulz, the president of the European Parliament was quoted as saying, “The worst nightmare for the European project is an outbreak of populism or political upheaval in Germany. Now it is looking like a real possibility.” He went on to say that the Schengen area is ‘buckling’. www.express.co.uk/news/world/ (2016/01/15)
Which road will the politicians take? It seems that they have run out of rope but are afraid of the consequences once their actions become apparent. A Hungarian commissioner Sandor Lederer has demanded to know why the EU Commission has not released the extensive report on corruption.
He is of the opinion that “Corruption is rampant in Europe” and that transparency should be a “…top priority at all levels of governance.” Frans Timmermans reputedly told the Civil Liberty Committee that he sees no point in releasing the document. Hmm, interesting!
www.euractive.com/section/justice-home-affairs/opinions
Corruption stories keep coming up all over the continent and yet there are no sackings, no heads roll, it’s a carry on as usual syndrome. Meanwhile, ordinary Joe goes to prison for fraud. Hmm, interesting! The stories of corruption are causing a dust cloud.
It is little wonder that the populace have a growing contempt for the politicians. It doesn’t matter the party in power they follow roughly the same line of thought; it’s just different shades of grey.
There is a sweeping antagonism and a deep mistrust of the politicians and of the opaque bureaucracy they have installed. No one is accountable. No one takes responsibility for any wrong doing. No one admits to failure. Everything is fine in La La Land!
The most telling point comes from an 86 year old Frenchman Maurice Beauzac from Chartres during a street poll held by Reuters:
 “We are living at a time when the word integrity is becoming meaningless to our politicians.”
www.uk:reuters.com   2017/02/09
The crossroads has roadworks! Trapped in the mire of their own making all the politicians can think to do is attack with ever more disparaging language. Sad isn’t?
This year is one of crucial elections in France, Germany and the Netherlands the outcome could seal the fate of the European project.
If we assume that the establishment parties win by whatever margin will they read into the result a clear acceptance of their programme? Or will they note the size of the opposition, an opposition that did not exist a few years ago and concede that change must follow?
It may well be that they will carry on down that same road and continue with the policy of austerity. They may turn a blind eye to the exposé of corruption and continue their role as the proverbial ostrich.
Meanwhile, several notable commentators, Goldman Sachs, Mediobanca have called for serious institutional and structural change. The Economist magazine notes a weakness of the euro as have several leading economists. Many have commented on the sluggish performance of most of the economies of the EU and see few prospects in the near future.
The most recent set of stats from the German official statistical office Destatis paints a bright picture for Germany and the Eurozone. Germany it concludes has achieved 1.9% uplift in activity in 2016 making it the fastest growing of the top 20 nations, due to higher exports and the weak euro.
For the Eurozone it suggests the highest lift since 2011. Destatis also points to the French service sector as ‘booming’. However, this contrasts with France24.com when they highlighted that tourism, a major contributor to the French economy, had a steep decline and that Paris had seen a drop of 1.5m visitors alone.
Martin Baccardax, The Street 2017/02/23  reported in msn.com/news
Unemployment is too high throughout Europe it’s a persistent harbinger of poverty and causing a persistent distrust of the politicians. Ordinary Joe is not feeling any upsurge in their personal well being and there are few good signs on the horizon.
Note the point by the New York Times: 50% of all new jobs since 2010 are temporary jobs in Europe. It’s a job but one without prospects and one that simply keeps the debt man (raptors) from the door.
https://www.nytimes.com/2017/02/09/business/europe-jobs-economy-youth-unemployment-millenials.html?smid=tw-nytimesworld&smtyp=cur&_r=1
Part time work feeds many problems down the line. If people are barely managing then how can they save for a rainy day? They cannot contribute to a pension for their retirement, a tab that will in all probability have to be picked up by the state. Tax increases?
Big business is screwing ordinary Joe now with part-time work and zero hour contracts. And will screw Joe later when Joe has to rely on a pittance of a pension from the government to survive.
Alternatively, people just fuel their own debt by taking out loans at exorbitant rates of interest and spend. Keeping up with the Jones’ is such fun – until the bubble bursts.
Nonetheless, at some point a state of listlessness creeps in, anxiety increases, stress leads to a host of other problems: break up of relationships, increase in violence fed by a growing anger, illness and crime.  Add a less than causal approach to productivity, all of which help to dampen the economy and force more fuel into the fire of discontent that has been growing.
Add to the mix the migrant crisis. These are people with as many aspirations as anyone else but many are finding that Europe is not the Promised Land. Lack of employment, trapped in camps, their culture clashing with local beliefs and other migrant groups. Desperate for the good life many enter illegally and too many become sub-human cheap labour for the profit hungry businesses.
“…traffickers are increasingly bringing in vulnerable people for the sex trade and as slave labour.”
Such is the problem created by traffickers that Frontex recognises that they are a       “…significant threat to the EU”.
On integration: “The high numbers of economic migrants – mostly with low educational qualifications and with a different cultural background – are not truly integrated into European societies. This causes social conflicts and critical perceptions of migration.”  http://frontex.europa.eu/assets/Publications/Risk_Analysis/Annula_Risk_Analysis_2016.pdf

Banksy

And the sanctimonious speak to their best friends: – see no evil – hear no evil – speak no evil!   Happy to smile for the cameras while playing politics with people’s lives!

Such is the political cauldron we live in today. There is but a tinge of hope that one day a door will open and objectivity will enter but alas – don’t hold your breath.
Do some good join – Robin Hood!

The Rape of the Poor

 

Try not to live as a pretender,

But so try to manage your affairs

That you are loved by wide expanses,

And hear the call of future years.

Boris Pasternak – It is not Seemly to be Famous – stanza 3

It is now well documented that while the super rich have grown richer the poor have travelled in the opposite direction. According to several economic writers the blame lies squarely with the neo-liberal economic model*, and, that its demise signals the last rites for capitalism. It’s a stretch to suggest that because one economic model has failed that we must prepare for a new world order.

However, there is one truth and that is that the poor have been raped. They have been raped of income, of opportunity, of prospects, of their self-esteem and of their very dignity. Let’s draw our picture with a few succinct and powerful quotes from notable writers.

The USA, under neoliberalism, boosted profits by impoverishing its own citizens.” Paul Mason (p19)1

“…income inequality has reached extreme levels not seen since the 1920s, and before that, the 1890s.” James Rickards (p236)2

The general thrust of these quotes are supported by other economists that I have previously quoted in earlier posts: Stiglitz, Chang, Rodrik, and Krugman. There can be no doubt that the poor have not kept pace with the distribution of wealth that has been generated. The push to globalization and its fellow rider free trade have cost the poor of the western nations much.

*www.en.wikipedia.org/wiki/Neoliberalism    

 Multinationals have simply used their capital to invest elsewhere, mostly in Asia and China in particular, to utilise the cheap and at times slave labour. A prime example, quoted in several books is that of Apple. This company pays to have its phones etc. manufactured in China by cheap labour but when the finished product comes back to USA and Europe, Apple charge a price that would equate to the phones being manufactured in America or Europe. The company makes huge profits from such an arrangement. Huge!

We are all now aware why the big boys have been promoting globalization and free trade; it’s of great benefit to their profit margin. The rest of the populace can go take a hike!

Banksy

But wait! The hoi polloi have not sauntered off with their cap between their legs. No, they’ve used their democratic right to vote against the elite. They have done what our politicians have been afraid to do.

Stunned, the elite stare in amazement at the audacity of the low-life. Some have voiced their anger at this popular wave of sentiment: the Brexit vote in UK, the Trump victory and the referendum outcome in Italy. Shit! they cry. The bastards are ganging up on us! However, the real reason is that the elite have been blinkered by “decades of denial” Rickards (p230) Paul Mason (p258)

Nonetheless, the elite have sent out their Stormtroopers to defend their rights. Politicians of various hues have marched to the given tune. Jean-Claude Juncker, head of the European Commission has made it clear that events should not be dictated by populism. John Major, ex-Prime Minister of Britain bemoaned the “tyranny of the majority” (John Stuart Mill 1859). Meanwhile, Labour MP Chuka Umunna, speaking on the BBC News channel spoke of the “elective dictatorship”.

·         These little men are so full of their own self-importance.

Let’s try and explain to these political hacks why populism is so in vogue:

“Once the election is over, voters are ignored and winning elites carry out preconceived plans”. Rickards (p238) Ring a bell? Been here before?

This leads nicely to philosopher Michael Sandel, (p13) 3

“Disillusion with politics has deepened as citizens grow frustrated with a political system unable to act for the public good, or address the questions that matter most”.

I would make one quibble with Sandel with his use of the word ‘unable’; I would have used the adjective ‘unwilling’.

Michael Sandel’s book was published in 2012 and was probably written therefore in 2011, if not before. Five years later and the elite still had not grasped the significance of what was happening right under their noses! The logical explanation is that they couldn’t give a shit. And now the shit has hit the fan!

One can only learn if willing to. It seems our political masters are unwilling. Their attack on democracy, for that’s what it amounts to, is a clear attempt to diminish the power of the majority. We cannot as a society, have a democracy that does not adhere to the majority vote, whether we agree with the vote or not. Let those who talk of the “tyranny of the majority” stand up and demand a dictatorship.

I appreciate that Karl Popper in his work the Open Society had a dilemma accepting a majority vote in favour of a fascist party. My response to his concern is that society should never get so low down that it is faced with such a prospect. A democratic society has failed if it reaches that stage.

In the midst of a crisis people hanker for a solution, a solution with the least trouble. The question is should people push forward in a direction of which they are unsure, full of doubt but advised to dare. Or will people be more cautious and look for something vaguely familiar or perhaps rely on the political party that appears to know what it wants and how to get everyone there. The road to fascism!

Democracy: The Only Road Forward

In the general election of 2015 in the UK, the Conservative Party polled 36.9% of the public vote and secured power as the next government. The Labour Party won 30.4% of the popular vote and is now trying to override a majority decision of 52% that voted to leave the EU.

The Scottish nationalist with 4.7% of the national vote are busy screaming in alto from the upper circle; joined by the Liberals who saw their percentage of the vote fall by a staggering 16%. The refrain of this unlikely choir is, ‘All we are saying, is let’s stay in’. They’ll still be singing as the gravy train goes rolling down the track – out of sight.

www.bbc.co.uk/news/election/2015/results

We have reached an impasse, will the political class respond positively and accept that the times are changing or must they be pushed to the wayside. Will it be the death knell of capitalism as espoused by Paul Mason and James Rickards? There is little doubt that neoliberal policies have proved a nightmare for the overwhelming majority. Those at the top end of the table had a feast out of neoliberalism. The question is are they now willing to share?

Perchance they will remain in denial as both Rickards and Mason state. If so what are the consequences? I doubt the elite can carry on much longer on their present course. The deep frustration with the elite will turn increasingly to anger which will beget activist groups taking up the cause of the people.

Such a scenario will not strengthen the elite as the use of force against these factions will break down quickly. It will not bring out the silent majority against the perpetrators. That old reliance was only solid when there was trust and most people felt good about their lifestyle. The rise of populism is a clear indication that many are genuinely feeling downtrodden.

Many of the elite may feel just as Mitt Romney does, “…inequality is the kind of thing that should be discussed quietly and privately.” J Stiglitz (p33)4  Those days I’m afraid are gone, if they ever existed outside the comfort of elite homes and country clubs.

Winter for all Seasons

According to Paul Mason (p262) quoting from a survey from the OECD that world development will be weak for the next 50 years and that inequality will rise by an estimated 40%. If these figures are anywhere near accurate then winter is going to be all year round for the poor. And if winter is all year round people are going to get mighty fed-up! Guy Fawkes might get reinvented for real.

Mason also states that the only way to keep globalization and free trade is by having the costs borne by the poor. Again if he is right – its winter! He gains support for his view from James Rickards (p227) who argues, “Yet free markets and free trade are flawed in theory, non-existent in practice.”

This assertion is proven when we look again at the practises of Apple and other conglomerates. Such businesses gain comparative advantage because their money buys more in China and the cheap labour make it a double whammy. China also gains comparative advantage by having the investment and the jobs. Who loses? The workers in America and other western nations!

Further examples are the manipulation of the Chinese currency the yuan or of their interest rates. Other nations have also made great use of the manipulation of both as well as the corporate tax which for example, is due to reduce from 28% in 2010 to 17% in the UK by 2020. Therefore there are no free markets or free trade; everything has a fix.

Nonetheless, the lack of truly free markets or trade does not spell the end of capitalism. The system has witnessed upheaval before, several times, and by hook or crook the system has mutated or morphed and we carry on. In living memory for some is the horror of the 1920s and 1930s – ‘Buddy can you spare me a dime’.

Another period of uncertainty was in 1968 when many of the young at the time believed they were on the brink of revolution particularly in France. In the USA there was the anti-Vietnam protests, civil rights, the rise of the Black Panther movement, and woman’s lib. The Prague Spring, trouble was brewing all over the world. “Many protests were a direct response to perceived injustices…”

www.en.wikipedia.org/wiki/Protests_of_1968

Most recently the 2008 financial crash has kicked many, right where it hurts. Ouch!

What is increasingly likely is turmoil in the EU. The euro () has never been stable and the single market is hurting many countries. These nations: Spain, Portugal, Greece, Ireland among their number have been on the receiving end of the slump that followed the 2008 crash. For eight (8) years they have held to the philosophy of the single market but, and it’s a big but, for how much longer.

Paul Mason (p261) argues that the EU is just one ‘political accident’ away from collapse. In this I would be in agreement with him. The self-interest of politicians from one of the nations mentioned above may be the trigger in a struggle to stay in power.  Moreover, the euro () was a political construct not a financial one and therefore weak from, GO. The bureaucracy is too big, and wields too much political power. A bureaucracy should never hold political influence; otherwise we enter the realm of Stalin.

However, any possible collapse can and should be managed. The EU needs to reinvent itself and those in power must surely be aware of the need for radical reform. The euro is but a starting point. It’s about the political class’s ability to face reality. If not – KA-POW!

Moreover, Mason and Rickards are not the first economic writers to predict the fall of capitalism. Joseph Schumpeter (1883 – 1950) had a whole school of economics named after him and prophesied the evolution of capitalism into socialism. It didn’t happen, as you are aware.

Schumpeter recognised that capitalism adapted and adopted but felt that the very nature of the system and the changes it goes through would cause its mutation.  Schumpeter  termed it ‘creative destruction’ thus the process of regular change and the growth of multinationals and management teams would stymie the entrepreneur, as a result  the system  would lose its dynamism and, the bureaucracy and the State would play a greater part in the new socialist world.

Of course others preceded Schumpeter. We can look back to Marx and Engels, to the world of Lenin and Trotsky, to Mao and the likes of Ho Chi Minh. With the exclusion of Marx and Engels, the other attempts at the promised land directed by the state from the centre came crashing down. The failure in all these enterprises was the insistence on ‘democratic centralism’ – basically the central committee told everyone what to do. It was the vision of the Politburo or nothing.

The other side of the coin of failure was trying to control development and trade in a predominately capitalist world. In essence they could not compete which forced their leaders to become increasingly totalitarian. And as usual the workers paid the price!

Market Economy?

Nonetheless, the state has a role in the capitalist system. Neoliberalism may want a minimalist state but we’ve never heard the big boys moan when regularly bailed out. In every economic downturn or crash as in 1929 and 2008 the state stepped in with tax payers’ money to prevent the catastrophe that would have followed in consequence.

Ha-Joon Chang (p456)5 is adamant that the state has a crucial role and may even be critical in maintaining a society for the public good. “The economy is much bigger than the market. We will not be able to build a good economy-or a good society-unless we look at the vast expanse beyond the market.” He cites Herbert Simon of the Behaviourist School, that 80% of economic activity happens inside organizations not in the market. (p159)

So what can the state do to help rebuild our broken economy? Many jobs can be created by investment especially by improving infrastructure: build more and better roads etc. Even Donald Trump threatens to help America get going again by infrastructure programmes.   

Retreat is another way to help our economy, retreat to the Bretton Woods agreement of July 1944 and claw back the free rein given to the banking sector through deregulation by Reagan, Bush and Clinton. Perhaps there’s a need for another clever intervention as with the New Deal 1933-1938 which held back the growing tide of anger at the depth and extent of poverty at the time. Of course the economy really took off with the Second World War but I’m not advocating a third.

The Bretton Woods agreement was an attempt to bring lasting stability to the world economy, and it worked until dismantled. The team which drafted the programme described the world of finance as “…a casino instead of a driver of economic well-being.” Rodrik (p97)6 Rodrik (p111) after examining a lot of evidence, stated, “The inevitable conclusion is that financial globalization has failed us.”  

Trade globalization can also be restricted and more power shifted to domestic governments. Let’s leave it to economist Ha-Joon Chang (p446) to lay down the case for a rethink:

“In the last three decades of hyper-globalization, economic growth has slowed down, inequality has increased, and financial crises have become far more frequent in most countries.”

Michael Sandel (p64) adds, “Economists often assume that markets do not touch or taint the goods they regulate. But this is untrue. Markets leave their mark on social norms. Often, market incentives erode or crowd out nonmarket incentives.”

Sandel argues that to put a price on everything diminishes the human interaction. He gives several examples such as the selling of kidneys and blood. Such enterprises hurt the lower class the most; it is therefore unfair, as here survival often necessitates the action. His philosophy demolishes the logic of neoliberal economists that we are all motivated by self-interest.

The trafficking of women and children for sex is a clear example. The kidnappers / sellers are self –interested as are the men who pay to use these unfortunates. But can it ever be justified? Would we or should we ever permit it as a legitimized trade transaction?

The human factor cannot be discounted from any understanding of how the world works. Money is but one example of a motivator. However, it’s also regarded as the ‘root of all evil’. Somebody knew something. Economists don’t like nouns like ‘altruism’ because they can’t quantify it and therefore can’t add it to their constructed model.

Let’s refer once again to the philosopher Michael Sandel (p130)

“Altruism, generosity, solidarity, and civic spirit are not like commodities that are depleted by use. They are more like muscles that develop and grow stronger with exercise. One of the defects of a market-driven society is that it lets these virtues languish.”

This is an area that I don’t think Mason has fully taken on board; emotion is a most powerful part of our makeup and can lead us in many directions. I’m thinking of religion and its hold over people and their decision making. Any move to socialism may be blocked, unless we let God in, because religion can be very intractable.

Obviously, the market is not all that the neoliberal /classical economists would have us believe. But is the capitalist system doomed as Mason and Rickards suggest. I have an alternative view of what is taking place. I believe it’s a war of the elites.

Clash of the Titans

Wealth creation has a direct relation with power and consequently the Middle East has become one of the richest areas on the planet. Therefore, presumably, it could become the prime powerhouse of the globe and its elite the most powerful group. Add to that scenario the emergence of China and its record breaking productivity which casts it into a power player. Then of course, we have the West, led by America.

On the outskirts of this game lies Russia, rejected by the elite of the West because Putin won’t play ball by the set rules. Putin cannot be trusted to conform to the big picture. So, Russia gets up to as much mischief as it can in an attempt to be heard and still retain some credibility as a big player.

So here we have it, three main players at the table and an outcast screeching on a bench nearby. The Middle East has vast wealth and can turn on a tap to get as much as it wants. China has been accumulating significant wealth over the last few decades and can screw its people for more if needed – bang goes their saving plans.

The West has a fair back up but needed a whole lot more, hence the rape of the poor. It needed to replenish the coffers to make the banker feel good. But the West had an ace up its sleeve; it could cause big trouble in little China and particularly in the Middle East.

War! The Iraq war was only partially about oil and more about destabilizing the region. The Arab world was then encouraged to turn against each other. In Libya, under the guise of introducing democracy the West invaded – the nation is still torn apart. A similar ploy was utilized in Syria. For generations the different brothers of Islam, Shiite and Sunni lived in calm cohesion, now there is nothing but killing of their brothers.

 China has built a powerful industrial base but this has been on the back of Western capital. The multinationals can at any time transfer their allegiance back to their home nation leaving China with a major industrial wasteland.

It may seem that the West have the resource to come out on top. Perhaps, but the rise of populism has taken the gloss off their cosy abode, unless they come up with something new damp and rot will set in and they could lose any advantage.

Therefore the contention is that the world is in trouble because the elites are at war. Once this battle is resolved it will be back to business. Thus capitalism is not falling apart; it is being used by the elites to fight their respective corner.

There is so much more to this theory: industrial espionage, the deliberate interference on manufacturing of products. In this war some industrial giants are being forced to recall damaged goods which have been sabotaged, costing them $ millions. It’s nasty out there!

Notwithstanding, neoliberalism has proven a disaster movie: the steadfast, independent and strong individual (read – elites) have fought off the greedy bandits’ (read –poor) and secured world domination. Not quite! Ordinary Joe is back with a new army armed with the knowledge that:

·         Financial globalization has failed

·         Trade globalization has failed

·         That inequality has greatly increased.

The people want a better managed, more fair, more decent society than the ‘grab what you can mentality’ of the present system. Citizens want a ‘civic spirit’; they want to flex those ‘muscles’ to strengthen the positive values to take us forward. The people want a fair share of the goods they help produce.

So we are getting close to the crossroads, there will be change but I don’t think it will be revolutionary, it will be a while yet before the end to the capitalist system. Capitalism will not meld or morph into socialism; we are simply not ready intellectually for that stage of development. How damned unfortunate!

Instead governments will spend as Keynes advised. They will also introduce a degree of protectionism while continuing to promote free trade. Currency, corporate tax and interest rates will be manipulated. The financial world will be regulated as before. This will be a period of stabilizing the economy. Government investment will become a crucial element in future development.

Much may be determined by the political class. Whether they have the nous to change, the strength of will, the character, and a sense of civic duty. Or will they besmirch the aspirations of the people and cry foul as have British politicians over the Brexit vote.

We move on, perhaps a tad slower than before but hopefully happier.

1.       Paul Mason        POSTCAPITALISM A Guide to our Future.

2.       James Rickards The Road to Ruin

3.       Michael Sandel                 What Money Can’t Buy

4.       J.E.Stiglitz            The Price of Inequality

5.       Ha-Joon Chang Economics: The User’s Guide

6.       Dani Rodrik         The Globalization Paradox

 

Bubble Wars

thXJDRNI6Q

Bubble Folk are the creation of a lack of reliable informative information the cause of which is mass media and political spin. It also has to do with peoples need to be a part of something. Television and newspapers promote the views of those who own them or who run them (BBC). Thus the predominant opinions we are given are those of the elite.

It’s increasingly difficult to find an objective opinion out there. Without a truly independent analysis of events that uses ‘why’ at the beginning of each question we never get to the crux of the matter. Basically we are treated as cannon fodder by the elite. We the public don’t need to know the ins and outs of an issue; it is their job to look after our interests. They ain’t doing a good job!

A Case in Point:

Recently after the Brexit vote in the UK and the general rise of people power across Europe I’ve heard Jean-Claude Juncker the EU commissioner state on three different occasions that they, the political elite, should not be held back by the rise in populism. Such statements suggest a number of things to me:

  • He does not accept democratic accountability.
  • There is by association the view that people have no idea what they need or want.
  • The political class see themselves as an elite.
  • That he and his ilk are Bubble Folk!!!
  • They have no desire to listen and no intention to act on the public vote.

 

Thinking.

Thinking.

Notwithstanding, we can only make decisions on the bases of the information we receive. Being bombarded by one view or by two strongly opposing views makes it all the more difficult to reach a rational, objective conclusion.

The other problem is that time on TV isth1zoq2kiv restricted and so much of what we get comes down to political sound bites. We have become the peoples of puerile language: texting, twitter and Facebook and all the rest. Billions of text messages are sent every day, much of the content of little relevance. I know I’m one of the culprits! E.g. what’s for dinner? Put the kettle on etc.etc.. I fancy a pint?

Moreover, politicians are their own worst enemy when it comes to presenting a point of view. Invariably they do not answer the question put to them but chose to state the message they want to get across. In so doing promote their own belief and their political party. They are cheap car salesmen! However, people have started to doubt whether politicians know what the truth looks like.

th13r6b7kgEventually political spin wears thin and the electorate switch off when the politicians start to speak. This acquired deafness is now a worldwide phenomenon as people realise that the political elite represent themselves. Reality of their living situations has forced ordinary Joes to recognise this simple truth.

 

Case in Point:

EU – Canada trade deal due to be signed this month, October 2016. The package was worked out in secret its conditions to be imposed on the populace. Business gets what it wants and the people, well, there might be some jobs created. But others will be lost! There will be some scraps left on the table.

Bubble Orgasm:

The political class were stunned by the recent referendum decision to ‘Leave’ the EU, June 2016. The ‘Remainers’ were apoplectic, overcome with convulsions of disbelief, some wanted to storm the barricades of working class areas and beat the …. out of them. It seems democracy is only permitted when the electorate vote according to diktat.

Those who voted to Remain cannot accept the vote and cannot give up on the issue, so convinced are they that the people have made a mistake. Little or no thought is given to why 17 million voted to Leave. Here in lies the crux of Bubble Folk – only they can be right.

  • Why did so many people vote to leave?
  • Why did they feel so disillusioned?
  • Why had this disillusionment not been addressed before?
  • Why have the ‘elite’ not shared more of the nation’s wealth?
  • Why were the ‘Leavers’ lambasted as racist etc.?

I‘ll go back to a point made earlier that the reality of their living situationthII1V3PKP forced the electorate to think of their needs and not those of the elite. There is a lesson in this situation for the elite to comprehend: – when you treat people like …. they will react.

 

Abortion: the Bubble War

There are few other issues that raise blood pressure more than abortion. This is trench warfare in the modern age. No middle ground, no room for compromise, not even a smattering of space for dialogue. No game of Christmas football here. The antagonists are trapped in their respective bubbles.

While there is logic in both arguments it is absent in the antagonistic approach each side has towards the other. There concrete stance has become the home of intolerance. It has become a war of attrition.

In political terms support in the Houses of power is determined by the numbers in each district. Whichever group has the largest number gets the politician’s backing. In these circumstances democracy is pushed along not by what is best for all of society but who has the loudest gob.

New Picture (1)Shout loud and shout long seems to be the best route to get your way. One more reason why ordinary Joes are fed up with the political system is that they are not heard but any minority with a loud gob is.

 

 

We Trust in God:

All religions are made up of bubble folk. Many use their belief system to promote their political aspirations but cannot identify the hypocrisy in so doing.

It’s a Long Way to Tipperary:

So the old song goes. It may well be a long way but it’s even longer to get to true democracy. It’s a steeplechase with so many ditches and a host of hurdles. We are transient folk, all of us, but politicians take it to a different level by their pre-election pledges that quickly become obscure and the newly elected abstruse when in power.

Our failure to make progress comes from the sheer lack of information that the people receive as to what is best for the whole of society as opposed to the demands of the elite. We have tranche after tranche of interest groups intransigent in their defence of their patch. There is much talk about the need of interest groups in a pluralist society.

Of course very few would like to live in a Stalinist environment or any fascist state. However, when groups become adamant in their approach and almost puritanical in outlook they become a hindrance to progress as they develop Stalinist tendencies.

Numerous environmental groups of various hues claim to have the best interest of society as their prime concern yet never stand together. Their interest seems parochial and in this sense serves the interest of the establishment and not that of society as a whole. They are the bubblers! thm83e71td

Driven Mad

thUZ27UX9O

Two guys in the USA looking at car emission issues were puzzled as to why American cars waltzed through the tougher emission testing whereas the European cars had difficulty. They decided to carry out a number of tests to see if they could come up with an easy solution, and to prove that cleaner cars could be efficient and still retain their power. They tested Volkswagen vehicles. The storm began!

www.telegraph.co.uk/news/uknews/road-and-rail-transport/11883343/

www.en.wikipedia.org/wiki/Volkswagen­_emissions_scandal

The exposé of Volkswagen over the emissions from their diesel cars has led to a bonanza of enquiries about emissions.  We are all now aware that we have been systematically lied to for decades by the automobile industry.

An examination of the testing techniques employed to determine the degree of emissions by Which?  consumer group has revealed a devastating picture of deceit by all the leading manufacturers. The extent of the deception is quite staggering when laid adjacent to the number of deaths associated with the pollution from cars.

Incredibly, 97% of all diesel cars give out nitrogen oxide (NOx) a highly toxic substance. The Which? sponsored tests by Emissions Analytics (EA) under the auspices of Imperial College London (ICL) has burst the protective bubble around the manufacturers. Which? describes the previous lab-tests as, ‘so seriously flawed they’re meaningless’. www.theguardian.com  January 2016.

Another dynamic of testing is that in colder conditions the emissions become worse, e.g. below 18C. A mechanism in the engine closes down which in turn facilitates more miles per gallon (mpg) but at the expense of greater toxicity. Obviously the manufacturer will highlight the better mpg and say nothing about the toxic emissions. Beware marketing!! Professor Ricardo Martinez-Botas of the ICL was taken aback and ‘shocked’ by the findings.  Daily Mail 23/06/2016

The Guardian further reports that by 2020 London will introduce an ultra-low emission zone.

Q? Why ultra-low, why not a definitive NO! Why wait until 2020?

Both car producers and politicians have been aware of the adverse effects of NOx and yet we wait to take action. The technology exists to produce cars of nil NOx emissions!! Note the words of Sir Malcolm Green professor of respiratory medicine when he says that such pollution is ‘shortening people’s lives’.

We may never know the full extent of the death rate from car pollution or how badly it affects asthma sufferers. Particulates from diesel cars are the deadliest form of air pollution and can easily trigger an attack of asthma. We know it brings on emphysema and bronchitis but what else.

  • The number of diesel cars in UK has risen from 1.6million 1994 – 12 million to date.

thE0TWUDA5The death toll is frighteningly high. The Mail online January 2016 suggests a figure of 30,000 annually with 23,500 directly related to diesel cars. The Guardian 2014 gave figures of 42,000 with 29,000 associated.

  •   NOx levels in UK are ‘far above safe levels for human health’. Mail online
  • NOx is at illegally high levels in several British cities. Guardian April 2016

Q?  Why have our politicians allowed this travesty to continue?

The answer may surprise you. Since 1993 the EU has introduced directives (E) to mitigate the pollution. In 2005 E5 was passed, in 2015 we had E6, therefore as far as the politicians are concerned the car industry has been pushed decidedly in the right direction. Hurrah? NO!

  • Those suffering from the effects of the pollution are not dancing in the street.

Taking the sum of 30,000 deaths per annum in UK, add some 40,000 from France and then the rest of Europe and we have well over 100,000 deaths due to exhaust pollution. One hundred thousand + deaths per year! If these souls were war dead, major ceremonies would have been held, plaques would have been placed in various venues and bronze statues raised in honour of our dead. But hey, most deaths are just a scattering of ordinary Joe’s.

thIQB7HPADA staggering death tally and the silence of our politicians’ hammers home a truth, a terrible truth – profit before people. As the death toll rises the EU is set to permit double the official limit of toxic emissions until 2021 and at 50% above thereafter. (Guardian) These targets I can only assume are based on the lab-tests so discredited by Which?.

Our leaders may suggest that their rationale is governed on the available science.

  • They encouraged people to buy diesel.
  • They are allowing the continuation of the pollution, beyond 2021.
  • We have the technology to build better engines. Now!
  • Since 1993 they have had knowledge of the cause and effect of car pollution.
  • The death toll is rising.
  • The number of cars on our roads will continue to increase. Pollution? Dah!

Roads

Roads go on

While we forget, and are

Forgotten like a star

That shoots and is gone.

Edward Thomas 1878 – 1917

The failure to insist on the use of better technology is an act of disdainful arrogance by the parties, the manufacturers and the politicians. The only conclusion to be drawn is that they are in cahoots. That our politicians skewed the advantage to industry is a surreptitious abrogation of their elected responsibility. It illustrates in graphic detail their utter contempt for the concept of democracy.

Q? What was the industry’s motivation? Profit!

Q? Will it ever end? Volkswagen is to pay $15 billion in compensation to USA drivers. Is this the necessary sting in the tail?

Do some good…..Join Robin Hood.

Europe: Moving Politically Right?

  • Our politicians

There are fears that Europe is moving inextricably to the right in politics. The numbers voting for the parties of the right has grown. Nationalism and an increase in xenophobic

If only it was about food waste.

attacks have prompted scaremongering.  The parties of the left in politics are equally loud in protest and actions. The increase of extremism can be laid squarely at the door of politicians; they will not admit it but their poor management has brought us to this juncture.

America is also witnessing a political phenomenon. And this is where our story begins. The decision of the American administrations of Reagan, Bush and Clinton to deregulate the financial system led us directly to the banking crisis of 2008. The repeal of the 1933 Glass – Steagall Act which brought regulation to the banking sector after the great crash of 1929, lead the way. Suzanne McGee (p269). The crisis of 2008 still has us in the doldrums. Thank-you cowboy Ron!

In Europe the crisis was handled badly, made worse by our political leaders. Joseph Stiglitz (pxxv) Greece had been allowed to spend aided by Goldman Sachs bank until the bubble burst. The EU refused to bail Greece out and instead insisted that the country go cap in hand to the IMF. A political farce ensued, Dani Rodrik (p218). Panic engulfed the EU caused by political ineptitude particularly on the part of Germany.

Greece was forced to pass laws on cutting its health service, on trade union rights including collective bargaining and to cut the minimum wage to secure a bail out. Austerity, austerity the catchphrase of the neo-liberal economists had taken hold. Prune back, was the rallying call, in order to pay your debts. Believing in the ‘confidence fairy’, Paul Krugman (p200) e.g. make the markets believe that you are not being profligate and they will continue to invest. Mm, the very people who caused the crash!

Prune, hack, slice; wages, jobs, the welfare state. Prune, hack, slice, the debt man’s at the gate. That was the basic spin from our politicians. Somehow the economic mire we found ourselves in was the fault of the workers and the poor. A telling analysis of the absurdity of such a political logic is given by Krugman (p200)

“The trouble with the current situation, [2012] insisting on perpetuating suffering [austerity] isn’t the grown-up, mature thing to do. It’s both childish (…) and destructive”.

We can add the voice of Stiglitz (p76) to that analysis:

“The irony is that in the crisis that finance brings about, workers and small businesses bear the brunt of the costs”.

Income inequality has been rising since the 1980s. Ha-Joon Chang (p333). The trend is acknowledged by many economists. The trend was marked in the USA and UK who have followed the neo-liberal economic school of thinking — austerity. Thus over a sustained period ordinary people have witnessed a decline in their living standards and the failure of politicians to protect their well-being.

Dissatisfaction has been brewing, the kettle is not yet boiled, but. Wages depressed, jobs scarce at the lower end of the market, the economic crisis not yet resolved, forced cultural change with growing concerns over migration / immigration. A very large section of society is concerned by the onslaught of politically correct doctrine and worry about their culture and way of life. The negative response of politicians has many feeling that their voice is irrelevant.

In the midst of this cacophony the politicians in the UK gave themselves a pay rise. The gulf has just got wider!

The sustained barrage of political correct idioms to be learned coupled by the demeaning labels: racist, bigot, NIMBY, old and backward etc. etc. etc. leaves many feeling they are being brainwashed by New Stalinists. Having to mind your P’s and Q’s every time you speak, support their interpretation of events. Perception is everything!

A note of caution from Howard Gardner the eminent Harvard psychologist (p51);

“…emotion is often a more powerful factor in influencing our behaviour than logic”. He suggests that there are: “…more neural connections going from the limbic emotional centre to the intellectual cortex”.

With the establishment of Sharia courts in the UK and the seemingly endless mention of the rights of minorities tends to suggest that the needs of the majority have already been met. This does nothing to broker acceptance or respect. Frustration and anger builds!

On and on the assault comes with an absence of someone to turn too. No political outlet because all the recognised parties are seen to be in cahoots. There is tiredness with interest groups hogging the limelight and achieving their demands. Politicians have forgotten the wisdom of Edmund Burke: cited in Charles Handy (p103)

“ Because half a dozen grasshoppers under a fern make the field ring with their importunate clink, while thousands of cattle, repose beneath the shadow of the British oak, chew the cud and are silent, pray do not imagine that those who make the noise are the only inhabitants of the field,…”

The real danger of the present situation is that the dissatisfaction with the establishment becomes ingrained. It could make a good Shakespearian play:         Macbeth Act 1V sc.1

“Double, double toil and trouble,

Fire, burn; and, cauldron, bubble.

No surprise that the electorate, middle-left and middle-right scour the horizon for an escape route. The far-right too has quickly recognised an avenue to explore and found many alienated folk standing on the roadside.

 Germany            –              NPD (neo-Nazi???)

France                  –              National Front

Austria                  –              Freedom Party

Netherlands       –              Dutch People’s Party

Sweden              –              Sweden Democrats

Finland                 –              Finns

The list could go on but the point is made.

Much of the anger at this time is generated by the migrant crisis and once again political ineptitude rears its ugly head. However, many of the parties of the far-right are also opposed to the EU – the mammoth without ears. Some of these hard-line groups have secured up to 30% of the popular vote and together hold an approximately 33% of the seats in the European Parliament. Amazing!

www.huffingtonpost.co.uk/2014/05/26/

The crucial point here is that they don’t want to reform the EU. They want to kill it off.

In the UK voters floundered in various directions, some finding solace with Ukip, but the electoral system (first past the post) dented their enthusiasm; 4 million votes but no parliamentary seats. Others took revenge on the Liberal and Labour parties leaving the Tories with a strong hand.

In the USA the republican right are being trounced by Trump, whilst the democrats have found an alternative voice in Bernie Sanders. Why?

The story unfolds with a Sky news correspondent Tuesday March 1 2016. A question of why a woman was voting for Bernie Sanders brought an illuminating response: she said it was not about Bernie but the doors his campaign opened to a wider discussion of many important topics.

Here an articulate, grey hair, voice of reason is seeking an explanation for her feeling of alienation from political life. Her voice is echoed in multiplies of millions around the globe. For decades the political class has ambled on impervious to ordinary folk and disparaging of their concerns. They had been emboldened by the lack of an opposition.

Floundering in the political mire, ordinary Joe felt powerless. Their only source of power they believed was their vote, but all the recognised parties were proving to be equally crap. Along came the extremes and sat down beside them and brushed their powerlessness away.

I can hear echoes of Caliban:      The Tempest   scene 2 187 – 195

No more dams I’ll make for fish,

Nor fetch in firing

At requiring,

Nor scrape trenchering, nor wash a dish.

‘Ban, ‘Ban, Ca—Caliban

Has a new master. Get a new man!

Freedom, high day! High day, freedom! Freedom, high day, freedom!

 

It seems that the political class are akin to an oil tanker, nice and steady when crossing the Atlantic Ocean but slow and in need of a lot of space when it has to turn. It has to turn.

Are we adrift?

Not quite but we are getting there. There is a growing feeling of unfairness out there in the world. Fairness is a powerful psychological trait. It is so strong that it can dictate people’s thinking, tied, perhaps rigidly, to a person’s emotion.

There is a sense of tiredness with the grab society; the, me, me, me philosophy of some. And with the flashy, look at my wealth occultists.

Charles Handy (p198) puts it well, “…it is ultimately not tolerable for the many poor to live beside the fewer rich”. Jealousy? No, disgust! During the so called ‘Golden Age’ of the 50s, 60s, 70s, everyone seemed to share in the prosperity created. Since the 80s times have changed.

The trickle-down effect

Many of the working class accepted the ‘spin’ of government that by cutting taxes for the rich this money would be used to create more employment hence the new wealth would ‘trickle down’. A similar ‘spin’ is given to corporate tax reductions. This view was entrenched until, “…in the face of considerable evidence that it is untrue”. Fukuyama (p465) Further evidence can be found in: Chang (p451), Stiglitz (pp 8, 78), Rodrik (p165) and Krugman (p84).

Quid pro quo

The rich and our politicians appear more focussed on feathering their own nests than being responsible leaders. The concept of clientelism: you scratch my back and I’ll scratch yours, is very much alive in the corridors of power.

In the UK members of parliament (MPs) were able to employ their wife and offspring at the expense of the tax payer. The expenses scandal of recent years is still haunting some of them. Others have been caught doing dodgy deals.

In America clientelism is all but a business whereby interest groups give generously to a politician’s campaign for election and in return gain influence in the corridors of power. Fukuyama (p87) suggests it undermines democracy because it “…strengthens existing elites and blocks democratic accountability”.

Therefore we can see why the people feel alienated from the political system. The feeling of powerlessness is not a fleeting will-o-the-wisp experience. As Ha-Joon Chang (p106) points out, austerity governments in the Netherlands, France, and Greece were voted out in 2012 followed by Italy in 2013. It made no difference; the austerity package of the EU was nonetheless imposed.

Meanwhile, in the UK the conservative government is busy cutting away at areas of the state in the name of efficiency. Slice by slice it is cutting into the National Health Service (NHS).

Perhaps politicians should take note of the wisdom of Fukuyama (p532)

“When governments cease being accountable, they invite passive noncompliance, protest, violence, and in extreme cases, revolution”.

Abuse of power

A further hard hitting policy is the raising of the retirement age in the UK. Women had their retirement age raised from 60 to 65 in line with men. Now everyone has to put in several more years before they can escape the workhouse. The ‘spin’ by the government is that as a result of people living longer the pension bill will be much higher and needs to be offset by people working for longer.

Some women will have had their work life extended by up to 10 years. How much is the government saving by that little manoeuver??

The true implication is that successive governments have sanctimoniously mismanaged the economy. For 50 years many have paid income tax and national insurance tax and god knows how many other taxes and now when retirement looms they are a burden. Shame!!

This is an abuse of power as it leaves large numbers of people feeling anxiety and guilt. It only affects the workers as the better off have the means and can decide when they want to retire. No such luxury for the less well off.

Thus we have the rise of the Tea Party in America and Donald Trump viewed as a saviour. In Europe the rise of the far-right and extreme left. In the UK we have Ukip on the centre right whilst the far-left are still sucking their dummies and waiting for the resurrection of Trotsky.

A few more words of wisdom for our shamelessly needy politicians – from the 17th century

“…government should benefit the people, not those in power”. Wang Fuzhi       www.en.wikipedia.org/wiki/Wang_Fuzhi

Karl Popper adds his voice: we need an open society; “…in which the political institutions can be changed by the governed”.

Do some good join Robin Hood!

 

Suzanne McGee                               Chasing Goldman Sachs

Joseph Stiglitz                    The Price of Inequality

Dani Rodrik                         The Globalization Paradox

Paul Krugman                    End This Depression Now

Howard Gardener           Multiple Intelligences: The Theory in Practice

Ha-Joon Chang                  Economics: The User’s Guide

Charles Handy                   The Hungry Spirit

Francis Fukuyama            Political Order and Political Decay

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Europe: No Highs.

 

Unity???

Unity???

As we spiral towards a referendum in June 2016 watch out for the spin of verbosity. It’s butter-up time at the polls. You will be near deafened by the bald tales from either side. Who has the correct answer about Europe, the stay- put brigade or the opt- out gang?

It should be obvious that big business, multinationals will favour the UK remaining in the embrace of the EU. It serves their business purpose. If Europe did not meet their needs they would be seen leading the charge to leave.

We are bound to hear stories of dire consequences, for jobs, livelihoods and a whole

Talking EU

Talking EU

gambit of other ghouls that awaits us if we depart. There will be ghosts in every unlocked cupboard which will become increasingly terrifying as we get closer to election day.

Nationalism will be bandied around like a worn tennis ball. Only Putin will be happy if we leave! However, an exit will not affect the sanctions that the EU has imposed on Russia over the Ukraine crisis. It will not affect policy on Syria. It’s all a smokescreen to remind the older voter of the Cold War.

Cameron’s position is weak because he gained only crumbs from the EU table. Did he expect anything else? Time will show that the ‘gains’ are meaningless. His cause has only brought about a poorly constructed but definite political grave.

There was no mention of structural change because it would not have reached the table for discussion. No matter that the time frame was too tight, with insufficient space for major issues to be studied and debated. Why the rush? He locked himself in a cupboard by advocating a referendum and, viewing public opinion knew he had to put his skates on.

Being kind I would say that the rush to the polls was bad advice from his advisors. If real change had been on Cameron’s agenda he would have taken his time; we have until 2020 to get a response. So why didn’t we ask for more? The answer is sky- blue; he knew it would not be negotiable.

Look closely at what the Prime Minister brought home and this tells us that the EU has no intention to change. We can have a few crumbs if we close the door behind us and shut up. The electorate has been played, duped and now we need to be herded quickly before we understand.

The EU can only survive with fundamental structural reform. It has been floundering since conception. The euro was another massive mistake. Europe is still recovering from the 2008 banking crisis; it will take several more years to swim clear.

thGUA278IXA lack of an audit and the continual escalation of spend is a sky-blue indication that the whole bureaucratic system has no direction and no leadership. It is a growing giant of an octopus. It will fail and the cost of life support will be huge.

Many leading economists had grave reservations about the introduction of the euro and misgivings about its future. Paul Krugman describes it as Europe’s big delusion (pp177-187) and a mistake from the beginning (p168) Krugman argues that it lacked a central focus such as the US Federal Reserve or the Bank of England. The European Central Bank (ECB) basically followed German thinking.

He illustrates how the euro and the ECB directly affected the countries of: Spain, Ireland, Portugal and Greece driving them deeper into recession. The policy of austerity was foisted on them. It would take seven (7) years before the ECB accepted quantitative easing (printing money to buy debt) and poured 3.2bn euros to support them.

Joseph Stiglitz another Nobel Prize winning economist lays austerity bare when he states,”…there has been almost no instances of countries that have recovered from a crisis through austerity”. (pxxv) Dani Rodrik yet another top economist has much to say on the experience of Argentina and its austerity programme. (Chapter 9 pp184-206) It was a disaster!

In essence the EU has caused many of its own problems rushing forward politically without thought of consequence. It is plagued by indecision and a thought process which operates on the basis of – what’s in it for me- (WIIFM)

The EU apparatus is divorced from the citizenry. The people don’t matter. The WIIFM syndrome is illustrative of its political absurdity. There is no unity of purpose, only agendas. Rodrik (p215) is scathing, “European Parliament operates mostly as a talking shop rather than as a source of legislative initiative or oversight”.

Such being the case gives lobbyists an open door. Francis Fukuyama (pp501-502) points to a quirk, he terms ‘jurisdiction-shop’. It works on the basis that if unsuccessful at their national level lobbyists simply pack their briefcase and head for Brussels. He cites the work of political scientist Christine Mahoney who suggests that ‘outside groups’ those seeking social change have ‘significantly less access to European Institutions’.

To further illustrate the lack of unity Rodrik (p218) is unequivocal when he says that when the EU comes under stress ‘the responses are overwhelmingly national’. The migrant crisis we are presently experiencing is a sky-blue example of such a scenario.

Europe is not for turning!! Unless it is prepared to, we must jump ship!!

 

  • Paul Krugman    End This Depression Now!
  • Joseph Stiglitz    The Price of Inequality.
  • Dani Rodrik         The Globalization Paradox
  • Francis Fukuyama            Political Order and Political Decay

Taming the Beast (5)

Democracy in Peril!

th[3]There is fear in the air, a fear that Europe is about to be sold off to American multinationals via TTIP (Transatlantic Trade and Investment Partnership). Concern has arisen because of a lack of information and of consultation by the EU Commission. Secrecy breeds doubt and scepticism. It allows a host of posits to be formulated and truth becomes the preserve of the speaker. Trust in the government system has been damaged by the Commission.

It is not simply the usual activists bawling their voices hoarse. The number demanding

If only it was about food waste.

assurances is considerable. The bbc1 report a huge demonstration in Berlin with over 100,000 in attendance. Demonstrations also took place in Madrid and other centres, caused by the ‘confidential talks’ that were taking place.

According to waronwant2 an online petition had already secured over 3.3 million signatories Europe-wide. War on Want point to several areas which may be under threat from TTIP: social standards, environmental regulation, labour rights, food safety and an opening up of the public sector to privatisation.

A further challenge comes from German small and medium enterprises (SME). This new group of business people have reservations about how TTIP will affect their livelihoods. They accuse the Commission, “The EU delegation has already caved in, weakening the standards associated with the carcinogenic Captan pesticide”.3   (Apparently it makes fruit look pretty4/5). The group are organising nationwide events to raise public awareness and are hopeful of adding another 5,000 businesses to their growing membership.

Anxiety is further heightened by a report in theguardian6. It notes that several documents from the EU dealing with correspondence between the Commission and oil companies were “heavily redacted”. Also, that detail of meetings with ExxonMobil and General Electric were “withheld entirely”.

Moreover, Lee Williams writing in the Independent newspaper voices7  endorses the analysis of War on Want but adds that most of the available information has come from leaked documents or freedom of information requests.

thHDQGIV03He brings our attention to ISDS (Investor-State Dispute Settlements) which many view as a direct threat to democracy. The case of the Swedish company Vattenfall is cited as they pursue the German government in court for reducing spending on their nuclear power generation. Williams suggests that there are some 500 such cases around the globe.

The article goes on to list a number of concerns with the trade talks. In particular, that th5GR2D1P370% of processed food in America uses GMO (Genetically modified organisms). The use of growth hormones in cattle while widespread in America is restricted in Europe. It is an obvious no-brainer that US businesses will insist on expanding this trade in Europe. The EU has virtually no GMO!

Furthermore, while Europe bans 1,200 substances from cosmetics the US only bans 12. Can we realistically keep our doors firmly locked against these products?

thABKKZDBBHowever, the area which caught my attention was the REACH regulations of the EU. These stipulate that goods must be proven to be safe before use. But, in America use is permitted until proven unsafe. Hands up if you want to be a guinea pig!

Another critical worry is that of data protection. According to opendemocracy8 the European Court of Justice has ruled that the US is not allowed to collect data about EU citizens. However, the article suggests there is “strong evidence” that Google, Facebook, IBM and Hewlett-Packard are lobbying intensely for a relaxation of the ruling. As you may have guessed, America does not have strong data protection.

The Empire Strikes Back

Cecila Malmstrom the EU Trade Commissioner has come back at the critics determinedly. She gives 10 straight No’s to: privatisation, treated beef, food safety and a categorical NO to a reduction in standards describing them as myths9.

In the UK we can already witness creeping privatisation in education and of the NHS. There’s a little procedure in the NHS which allows patients to make a choice of hospital, it’s called ‘choose and book’. It seems a minor intrusion but is a Trojan horse of massive proportions. There is an estimated 1250 private hospitals in the UK and expanding quickly.

The Commissioner claims that the negotiations are as open as possible. The phrase ‘as possible’ is a money sign to a lawyer and a credible doubt to a member of the public. It is well documented that MEPs had to seek permission to read some documents in a closed environment. This restriction has recently been lifted.

Furthermore, the evidence of the Guardian, the Independent, Open Democracy and SME of Germany tends to shed a different light on proceedings. Therefore peoples’ disquiet cannot simply be dismissed. In the latest draft the Commission has made a concession to include better access to information for small and medium companies after severe criticism from SME.

The Commission’s submission on trade and sustainable development, a whole chapter, states that there will be no relaxation on the EU’s present laws and commitments. That it will maintain all regulation based on ILO (International Labour Organisation) Decent Work Agenda. That such a commitment is not negotiable. But, in the small print the Commissioner accepts that the US and EU have different strategies on labour and environment and it may come down to legal interpretation.

We should also consider the view of America’s trade unions that recognise that Europe has much higher standards and warns:

“…U.S. – EU agreement must not be used as a tool to deregulate or drive down these higher standards. If that is the goal, working families of both regions will pay the price.”10

Perhaps the greater concern is ISDS, reassigned by the Commission as ICS (Investment Court System). The whole concept of a court deciding and/or overriding the democratic rights of the electorate leaves me cold.

Cecila Malmstrom believes she has tightened the legal framework by insisting on qualified judges and a guarantee of an appeal. Her proposal will ‘enshrine’ a government’s right to regulate.

There are several issues with this court. It reads like a massive money spinner for legal teams. Interpretation of the law will become critical to any judgement and could be determined by the political bias of the legal mind.

If government can regulate (enshrined) and thus change the law to suit, will this not make the court null and void. When a company decides to challenge a national decision, must the court rule on existing law or EU law? Is there any possibility to introduce retrospective legislation? Or are we all aboard the EU ship?

There are doubts by the boat load. Minor and major concerns and a lack of detail about the process sees these concerns grow deeper.

thKF8B2C69The Commission are undertaking a charm offensive but the damage has been done; trust in the integrity and the ethics of the deal has soured many minds. There is no doubt the deal is about profit not people.

References:

  1. www.bbc.co.uk/new/world-europe-34807494
  2. www.waronwant.org/What-ttip
  3. www.euractiv.com/sections/trade-society/smes-want-ttip-rethink-319822
  4. www.en.wikipedia.org/wiki/Captan
  5. 5. sitem.herts.ac.uk/aeru/ppdb/en/Reports
  6. 6. theguardian.com/environment/2015/nov/26/ttip
  7. 7. independent.co.uk/voices/comment/what-is-ttip-and-six-reasons-why-the-answer-should-scare-you-9779688.html
  8. www.opendemocracy.net
  9. www.ec.europa.ea/trade/policy/in-focus/ttip

www.trade.ec.europa.ea/doclib/press/index.cfm?id=1364      also 1396 + 1393

www.bookshop.europa.eu/en/the-top-10-myths-about-ttip-pbNG0614128/

  1. www.aflcio.org/issues/Trade/U.S.-Free-Trade-Agreement-TTIP

<!– AddToAny BEGIN –>
<a href=”https://www.addtoany.com/share?linkurl=www.upoak.com&amp;linkname=”><img src=”https://static.addtoany.com/buttons/share_save_171_16.png” width=”171″ height=”16″ border=”0″ alt=”Share”/></a>
<!– AddToAny END –>