May 8, 2013
The financial crisis of 2008 has been touted worldwide as a failure both of an economic system and a political system. More specifically, the apparent inability of democratic politics to handle its aftermath has threatened to undermine the consensus on liberal democracy and lightly regulated capitalism that emerged following the collapse of the Berlin Wall.
Contrary to many expectations, however, political groupings of the left have derived no benefit from the crisis. Socialist movements have waited for more than a century for capitalism to collapse from its own internal contradictions. Yet, when that prospect appeared likely to occur on their watch, leftist governments – especially in the United States and the United Kingdom – vied with each other to avert such a collapse by shoveling public money at the capitalists.
The ‘change you could believe in’, brought to the political arena by Barack Obama and by Francoise Hollande, was principally that they were not their predecessors. The failure of such leftist politics has now opened up opportunities for new political groupings – the Tea Party in the United States and the United Kingdom Independence Party in Britain – designed to destabilize the existing two party systems.
Such new groupings are disparate in nature, seemingly devoid of any unifying political program. What they have in common, however, is a new nationalism:
“Yet they share a resentment of others supposedly responsible for our problems – a media and a political class that supposedly fails to acknowledge popular concerns, and foreigners who do not share our culture or our heritage. United only in grievance, they are so varied because by their nature they can be only national.” John Kay, ‘Sinister or silly, protest politicians are united in grievance’, Financial Times, May 8, 2013
May 5, 2013
Greek Cypriots confront a grim economic future following banking collapse and bail-out by the euro-zone. Gross domestic product will decline by 15 per cent in 2013, by another 15 per cent in 2014 and perhaps by another 5 per cent in 2015..That is comparable to the decline over 1974-1975 following a failed Greek-led coup followed by a successful Turkish invasion and a Turkish-Cypriot-controlled north.
It will take many years for Greek-Cyprus to return to its pre-crisis level of gross domestic product. A more vibrant north currently rivals the lowered living standards of the south.
The island as a unified whole, however, would enjoy two promising sources of growth. One is the recently discovered Aphrodite gas field in the Easfrern Mediterranean. The other is tourism, an underdeveloped industry with plenty of scope for foreign investment.
Without reunification, both sources of wealth are unlikely to be tapped Both governments lay claim to the gasfield while the cheapest route for exporting the gas would through Turkey. Tourists shy away from unstable regions.
Whether Cypriots will respond to strong economic signals is far from certain. Cyprus, it is said, never misses an opportunity to miss an opportunity. However the combination of a Greek-Cypriot meltdown and the Aprhrodite gasfield may just suffice to return the crazy Cypriot people to to a modicum of rationality. Sometimes even irrational peoples recognize win-win situations.
May 4, 2013
Above the entrance to the U.S. Supreme Court four words are carved: Equal justice under law. The message is perfect for a people that pursues inalienable rights to life and liberty and an imprescriptible right to property – even a society that once pursued such objectives very unevenly across the races.
It is tempting for some to request unequal treatment under law designed to benefit those treated badly in the past. Such indeed is a current occurrence in the United States with respect to certain ‘minority groups’. But what may be popular and widespread is fundamentally wrong.
Once equal justice under law has been established, it should never be violated again. For to violate the rule is to suggest that there is a better rule, which is untrue. No society can pursue the goals of life, liberty and property effectively in the absence of the rule of law. And those four words carved above the entrance to the U.S Supreme Court perfectly express the essence of the rule of law.
Hat Tip: Time to scrap affirmative action’, The Economist, May 4, 2013
May 3, 2013
Illinois has the dubious reputation of the worst state pension deficit in the United States: $98.6 billion.In part because of this, Standard & Poor’s gave Illinois the lowest credit rating in the nation.
Democrats, of course, control both the House and the Senate and the Governorship. So it is to their credit that the House has passed a bill to cut state pensions and to increase contributions. The Governor also supports the bill. The Senate is wobbling but may well endorse the bill.
Do not hold your breath readers, that commonsense is sweeping through Illinois. An 800 pound gorilla lurks in the shadows. The public sector unions threaten to sue the state for breach of contract should legislation go through. It is a truly hard battle to take down these dinosaurs who are the principal cause of such budgetary headaches.
Still there is a chance and that is much better than another roll-over by the state,
May 2, 2013
“At the president’s news conference Tuesday, when a reporter wondered whether setbacks on gun control and the sequester suggested Mr. Obama was having problems pushing his second-term agenda, the president replied, ‘Well if you put it that way, Jonathan, maybe I should pack up and go home.’ Whoa, big fella. The presidency is a big game. We want you suited up and on the floor.’” Daniel Henninger, ‘Presidential Followership’, The Wall Street Journal, May 2, 2013
That the presidency attracts individuals focused on Number One is no revelation. That the focus sometimes reaches the psychological condition of narcissism, when a president actually lacks self-love, because of a disrupted childhood, and seeks compensatory adoration from campaign followers, is also not unknown. President Obama suffers from an excessive focus on Number One and a chronic form of narcissism. With 40 months in office remaining, this is a dangerous situation for the United States.
It is dangerous because such a leader essentially becomes a follower of any group of adoring citizens, concerned never to breach their love by an act of statesmanship. Standing essentially aloof from the major branch of government – the Congress – unable to lower his self-esteem by negotiating deals that are helpful to the public at large, Obama is trapped by his followers into a followership mode of governance. That is why he is essentially impotent on gun control laws, on fiscal policy, on Syria, and on Middle East policy.
“Whether Roosevelt, Nixon, Bill Clinton or George W Bush, every second-term president must in time come to grips with the reality that it can’t be about just him. It, the presidency, is unavoidably about offering clear leadership for all the American people and a watching, always unsettled world. If Barack Obama insists it’s about something else, everyone, including him, will have their bags packed for a long 40 months.” ibid.