On the competitive advantages of countries (and USPs)

Athens has never had a Manhattan (like NYC) and imo it never should.

Or a City (like London).

The solution is for those who want a City to move to London and for those who want Acropolis, Greek, islands, and a different way of life to stay or move to Greece. Especially true in an EU context, since intra-EU freedom of relocation is high (not perfect or as high as within the USA, but high). That same rationale could apply globally if global freedom of relocation of persons was anywhere near a descent level, but it is not (the WTO and capital freedoms are not enough, humans' freedom is the key premise in my rationale here, because humans are the basis for all econ/fin, biz and other dimensions, w/o humans what the point of economics, biz etc, not a Caprica (see US TV series)).

Trying to import US, UK, German and other models to Greece and other PIGS (and vice-versa) is wrong Strategy (and wrong philosophy).

One does not give up one's USP (unique selling proposition) to try to copy another's. In spite what many think re the success of copycat products in recent years (aka survival of the cheapest).

For example, US and other foreign educated Greeks (and tdes me) have the challenge to develop suitable original models for Greece not try to copy or transpose other models or patches of the UK, US, German, Dutch etc models.

My scepticism includes study of best practices, not in principle, but in practice. Imo, at best, best practices should be examined as a mere part of a brainstorming process, not as an excuse to shortcut original (and systemic) thinking in models of competitiveness.

World systemics: Import this!

After reading the WSJ article: "Germans, Prizing Virtues of Saving, Find Euro Bailouts Hard to Swallow", June 25, 2011, my brain was stimulated enough to make the following syllogisms:

Roughly speaking, it seems some people (eg Germans) are over-saving, some (eg Americans, Greeks, Irish, Portuguese, etc) are/were over-spending (consumer credit).

Some eg Germany, China, S. Korea, etc are over-exporting, others eg USA, Greece are/were under-exporting (or over-importing).

Please import these syllogisms and export your opinion:

Was Ricardo wrong?

Germany's competitiveness: Beyond myths and inside the systemics

On June 8, the German national statistics agency announced that in April (2011) German exports fell by 5.5% to 84.3bn euros compared with March 2011 (see eg BBCnews report).

The March 2011 German exports had been Euros 98.3bn which were:
1) +16% from March 2010
2) the highest monthly total since 1950 when record keeping began!

The April drop surprised analysts, according to the BBC. But it did not quite surprise me.

In my May 9 post, "German exports record high in March vs Euro/USD rate", I had wondered:

"But what was Euro/USD in March compared eg to last week (the week before "the weekend"? See a chart eg here and draw your own conclusions!"

The "here" was (and is) a EUR/USD Elliott Wave Analysis chart (May 9)(here is the latest one, June 6). They show that the price of the Euro vis-a-vis the USD not only had reached a "local" low in March 2011 but had been within the 1.35 - 1.30 USD per Euro range (roughly) from late 2010 until March 2011. One does not expect a country's exports to be correlated with the same month's currency value because after all, orders, especially international, do take some time, depending on the type of good or service (eg in tourism many bookings are made many months ahead).

But the fact that the Euro by March 2011 had been in a range lower than its local 1.5+ high that had been reached around Jan 2010 (then sliding from that 1.5+ high from roughly Jan 2010 to June 2010, when in reached a less than 1.2 "low", and the started to go up again), did pose some questions as to the factors/drivers behind the super duper German export record of March 2011.

Notably, after the March 2011 local low of approx. 1.3 USD per Euro, the Euro climbed somewhat steadily up to the 1.5 territory in the next 2+ months. Did that affect the April exports performance? That I do not know. Does someone? Feel free to comment!

In other words, German exports, which are said to be mostly manufactured "complex" goods, said to be mostly produced by sophisticated small and medium German manufacturing firms to quality levels that justify a higher price (be it due to "national" costs or the expensive Euro (successor of the expensive/hard DM or profit margin) in the world's markets was/is allegedly the "key" to Germany's export success (formerly No 1 in the world and now second only to China of the 1.3 billion people compared with 80+ million Germany).

Maybe it's my MIT education that taught me to ask questions such as "why" and "how" even for things that are pretty much taken as "facts of life" or "given" by many others, maybe it's my systemics analysis - operations research - decision science education as well as an MBA, but in any case, I was and still am eager to get to the bottom of the systemics of the German competitiveness model, beyond the myths and inside the mystique that surrounds them.

A myth that says that hard working Germans, working smart and with quality equipment and a knack for organisation and engineering, produce goods and achieve export power that the likes of Spain, Portugal, Ireland, Italy, Greece (aka PIIGS) and most of the other EUropean and other economies cannot (and should?) achieve!

Not being a believer in national stereotypes, but being a believer in systemics, I am willing to accept, after more research that there may be systemic conditions that render Germany a more competitive economy than eg the PIIGS (and if possible isolate and examine those conditions or, if you prefer, parameters or factors). But I need much more info and data than the ones offered by the analyses of German competitiveness that I have read so far. Feel free to recommend ones (via e-mail) if you are aware of.

One thing that IMO does not bode too well with the myth is the datum that 60% of German exports are to its EU Single Market partners. That means that the rest of the world, outside the EU, only buys 40% of Germany's exports. So 60% of these largely complex and 'expensive but worth it; manufactured goods are bought by a market of roughly 0.420 billion inhabitants, while the rest 40% by the rest 6.4 billion non-EU market of this planet!

And when at least 120 million of those 420 million (ie the PIIGS) are in some kind of austerity, hitting a record month in exports (March 2011) seems quite unsustainable unless there are data that other markets (eg the developing BRIcs etc) are picking up the slack one expects from the "austeritised" PIIGS (and to some extent the rest of the Eurozone and the EU).

More on this in the near future as I will be trying to dig deeper and deeper into the system/model of German competitiveness.

For now, one last note:

I read a lot of commentators, some German, some other EUropean, some from other parts of the world, urging the PIIGS to become (in terms of economic modeling) more like Germany. My question is the following simple (and maybe dumb) one:

If all of the Eurozone moved from production (and export) of simple to complex goods a la Germany, then that would increase up to 300% the volume of such goods produced in the Eurozone (80 x 4 = 320) and 500% in the EU (90 x 6 = 480). Ie for each German complex good produced by Germany now, there would be 3 more of the same produced in the rest of the Eurozone and 2 more in the rest of the EU. Making the total volume of German type complex goods produced in the EU 6 times the existing one.

In such a case, what would be, via the "law" of supply and demand, the effect on the equilibrium price for German+rest EU "complex' goods? To use a Marketing term, if the rest of the economies of the Eurozone or the EU would produce German type of goods, then there would be cannibalisation in the (EU and world) markets. Leading of course to much lower prices for these goods. Food for thought, huh?

The cheap, hard or smart way to EUrope?

In view of Angela Merkel's recent comments re South Europe, some thoughts:

Work cheap, work hard or work smart? Which is Europe's key competitiveness problem (other than the uber hard Euro)?

There are many biases (incl philosophical) in the way dominant Economic dogma defines hard work - productivity. The Merkel comments also show IMO how unaware she is about the work smart (vs work til you drop) model her neighbours the Scandics take pride in!

To paraphrase Bill Clinton, "The (Eurozone) periphery stu...."

Today the ECB decided to keep the Eurozone rates at 1.25%, following the increase from 1% to 1.25% last month (see eg BBC's news report)

Thank god for Eurozone exports (to the rest of the Eurozone, the EU and world markets as well as their competitiveness vis-a-vis cheap third country imports) and tourism (Spanish, Italian, Greek, Portuguese, Irish, etc)!

I am beginning to think that ECB philosophy is either too German or not German enough (or both at the same time)! In any case, it is "off".

I felt that I am not alone in the Universe when I watched excerpts from N. Roubini's speech at the Estoril Conferences in Portugal yesterday: Inter alia, he did point that expensive Euro was a "nail in the coffin" of PIIGS economies! (and still is IMO). He opined (and I so agree) that with the Euro being worth 1.5 or even 1.4 Euros the PIIGS economies have a hard time being competitive vis-a-vis non Eurozone cheap products! And he did "accuse" German economic policy of not increasing its domestic demand to help the PIIGS' (intra-Eurozone) exports!

Updated! Industrial Producer prices hikes among Eurozone members: Cause for concerns

The update include some comparison of March 2011 compared with March 2010 IPPIs with March 2011 compared with March 2010 inflation numbers (as released by Eurostat back on April 15).

Eurostat published today (May 3, 2011) the stats re Industrial Producer Prices (Industrial PPI) for March 2011.

Along with the stats published re February 2011 vy Eurostat on April 2011 (a few days before the ECB rate hike from 1.00 to 1.25%), these stats, for the EU27, as well as the Eurozone and individual members should cause IMO much concern. I have partly already tweeted and blogged some of my concerns.

1) These include a concern of mine that these stats show low integration and lack of adequate competition at least with respect to industry in the EU and its Single Market and even more importantly, in the Eurozone and among its members. Because while the prices of industrial inputs are higher due to hikes in world prices of energy and some foods, the very high Industrial PPIs show that firms choose to pass on a very large part of those down the line, ie to the whole-sellers and these may eventually reach the consumer thus a major concern re CPI (ala inflation) which is already high in the Eurozone by ECB standards (ie 2% target).

What is also notable, and I have to trying to understand why, is that the IPPI for NL and Belgium, ie two economies with a strong industrial capacity and quite integrated, one would think, to their neighbour Germany, are exhibiting, compared with same month last year (February 2011 to February 2010 and now March 2011 to March 2010) very high numbers.]

Let's have a closer look, trying to think systemically:

In March 2011 compared with March 2010, industrial producer prices gained 6.7% in the Eurozone and 7.4% in the EU27. For February 2011 vs February 2010 the corresponding numbers were 6.6% and 7.1%. Note that the IPPI is higher for EU27 than the Eurozone16 and the increase compared to February in March is higher for the EU27!

Also note that (Eurostat, April 15) Eurozone annual inflation (provisional) was 2.7% in March 2011up from 2.4% in February and EU annual inflation (again provisional) was 3.1% in March 2011, up from 2.9% in February.

What will these high Industrial PPI numbers for the Eurozone and EU mean for inflation in a few months from now? And why are they so high?

But what do the IPPI numbers show re the EU single market for industrial goods, especially at the Eurozone's core (Germany, NL, Belgium, etc)? Note that whereas Germany's IPPI was Feb2Feb 6.3% and March2March 6.1% (ie without any effect by ECB rate hike later, in April), the NL's IPPI was respectively 10.3% and 10.8%! For Belgium, another close neighbour to Germany, only the Feb2Feb stat is available for now: 10.2%!

At the same time February annual inflation in Germany had registered at 2.2% and 2.3% in March (Eurostat, April 15). Thus head to head annual Industrial PPI for March stood about 380 basis points above annual March inflation in Germany (down from 410 bp in February).

In NL, annual inflation stood at 2% in February and again a privisional 2% in March. Ie 830 and 880 basis points when compared to the NL annual Industrial PPI for February and March!

Thus the NL spread is about double the Germany one! Why?

In Belgium, inflation was 3.5% both in February and March, ie 670 bps (not IPPI available yet for March in Belgium)! Again, why such large NL and Belgian spreads compared to Germany?

Now add Denmark, another close neighbour yet not fellow Eurozone member, the IPPI jumped from 5.8% Feb2Feb to 9.3% March2March!

What could be driving these large hikes and the wider differences even between neighbouring economies except, I assume, inadequate Single Market integration and inadequate competition? If you have a different explanation, feel free to add it via the comments or a tweet @nppolicyanalyst!

2) Most hikes are largest in the EU27 than in the Eurozone

Industrial producer prices on the domestic market, % change compared with March of 2010

Eurozone (vs EU27)

Total industry excluding construction 6.7% (in the Eurozone) vs 7.3% in EU27
Total industry excluding construction and energy 4.5% vs 4.6% in EU27
Intermediate goods 7.9% same as in EU27
Energy 13.0% (in the Eurozone) vs 14.1% in EU27
Capital goods 1.2% vs 1.3% in EU27
Durable consumer goods 1.8% vs 1.9% in EU27
Non-durable consumer goods (in the Eurozone) 2.9% vs 3.4% in EU27

Note the 3 areas of major differences between the Eurozone and EU27:
1) Total industry excluding construction 6.7% (in the Eurozone) vs 7.3% in EU27

2) Energy 13.0% (in the Eurozone) vs 14.1% in EU27
3) Non-durable consumer goods (in the Eurozone) 2.9% vs 3.4% in EU27

Can you offer an explanation why?

Eurozone systemics: Some crucial considerations, beyond stereotypes

Can anyone deny the effects of the expensive Euro periods since 2002 on the economies, exports, tourism, competitiveness and budgets (tax revenues) of many Eurozone members (PIIGS included)? Even these days, when the Euro is worth 1.4 USD!

And what is the effect of that on Chinese exports to the Eurozone? A "flood"! Not to mention US, UK, even Swedish exports to the Eurozone.

And the effects on the tourism of Greece, Portugal, Spain, Italy and other Eurozone members that compete as destinations with neighbouring or distant non Eurozone and non-EU countries/economies.

Let's be honest: In the last 50 or so yrs, being a neighbour of Germany has been a great advantage (exports) for many economies that are mow member of the Eurozone or at least the EU.

In other words, have NL, BEL, DK, FR, SWE, etc not benefited from their proximity to the German market (the perennial steam engine of European growth) compared with eg POR or GR? In many ways, not mere exports. And of course Germany has benefited too from this "integration" due to proximity.

Also, should one go into a Max Weber type of analysis in order to understand the roots of the difference in economic, biz, social and other systemics, eg between NL and POR? In yes.

Plus, as per the "transfer union" soundbites, the bottom line is that yes, a US of E will have de juris to be a transfer union, much like the USA is. Else it's a Catch 22 European union.


PS 1) At its roots Economics, unlike Physics, Chemistry or Maths, is a social science.

PS 2) Do European countries have the same historical traditions and philosophy re eg accounting and audit? IMO, no, these vary considerably. Some cultures focus on the future instead of over-analysing the past, hence have less of a tradition in accounting, stats, etc than other ones!

Is it a plane, a UFO or the EU (finally) moving forward?

Is it a plane? Is it a UFO? Is it a mirage? No, it is the EU (finally) moving forward, albeit in a clumsy (and confusing) fashion!

In effect, part of what is happening at the moment in the EU is a move to break away from the UK's "union-blocking"! In the midst of quite complicated systemics and dynamics that do contribute to the difficulty and confusion, but also make ever closer ie deeper union in Europe even more of a must.

More specifically, as I tweeted last Friday, there is an urgent need for a sovereign EU in:

a) energy

b) defense

c) economics (internal market)

d) foods, especially staple ones

etc

yet open to the world (eg with a more "open" policy re immigration, be it of asylum seekers or the so called "economic immigrants")

Part of the world systemics and dynamics are:

1) In recent years the US has left a gap that can best be filled by the EU rather than China, provided the EU evolves into a US of E or a Fed Rep of Europe.

Eg the US was a beacon and a magnet for all people who were suffocating in their natives parts of the planet and who wanted to strive for a better future in an environment where it mattered more where you wanted to go and become and less your background or class or birth rights. IMO after the closing of Ellis Island, that US started to wane. And has become immigrant hostile in recent years. Many more examples of the gap, but not to be discussed in this analysis.

So, a fully united, independent and sovereign EU would be a positive factor in world affairs instead of the current situation (see rise of xenophobia, nationalism, grand standing by France, Germany or the UK, a stance that the American diplomat whose cable was leaked eloquently described (referring to the UK, France and Germany) as Europe's dwarves (see "Manipulating the Political Dwarves of Europe" by Gregor Peter Schmitz in Spiegel International 12/10/2010)

etc)

2) China's 2001 WTO entry and its policies have caused major systemic quakes in US & EU, as I tweeted on Saturday.

They have even been a factor in the Euro's probs, IMO.

2 of the interesting articles/analysis that have appeared in recent days are:

"Nine EU countries set out post-crisis growth plan" reported on Friday, March 18, Andrew Rettman in the EUOberver.

"Prepare for a Euro Zone Divided in Two" is the title of an interesting opinion article by Irwin Stelzer, director of economic policy studies at the Hudson Institute in Washington, in the WSJ (March 21).

They both merit reading as valuable food for thought.

Regarding the topic in Irwin Stelzer's analysis, IMO of the 10 non-Eurozone EU members, 3 of the old EU15, the UK. Denmark and Sweden have willingly chosen to be marginalised by staying out of the Euro. The other 7 are still relatively new EU members (5 since 2004 and 2 since 2007) thus have more "excuses" for not having joined the Euro yet (of course at least 1, the Czech Rep., especially under its current President, seems unlikely to want to join, for ideological (libertarian?) reasons).

But the rapid EU enlargement from 15 to 25 then 27 was not meant to be at the expense of deepening, although it did, but the delay has been long enough that a dynamic even somewhat "clumsy" move forward, had become overdue. Not that the delay was a fault of the new members that after all were "owed" EU membership for the suffering they endured by communism (and for what happened back in Yalta and Potsdam). It gave others the excuse to slow the EU's deepening down. But no more, especially after Cameron's UK Sovereignty Bill. As the governor of the Bank of England reportedly told the Americans (according to the famous leaks), the Euro crisis was bound to accelerate the move towards federal Europe. After all, IMO as well as others', the current Euro crisis is caused by the fact that Monetary Union was not preceded or at least accompanied by not only Economic but Political (federal) union as well (as I said, causality in our times is very complex and not open to simple analyses, so bear with me)

So if Sweden and Denmark find themselves left out of key meetings of EU interest as The Economist notes, according to Irwin Stelzer (in effect the Eurogroup meetings that take place 1 day before each ECOFIN Council of Ministers of Finance and the recent first ever Eurozone Summit), they should recall that the Euro was not decided in 1991/92 (Maastricht) as an optional (buffet) feature of the EU, but as the vehicle for a) making the EU common then single market (by 1/1/1993) more effective and b) moving the EU forward!

And I agree with the view expressed by many that non-Euro membership of an EU country/economy, gives that economy an unfair trade advantage inside the Single Market of the EU. Of course, with life on Earth systemics nowadays being complex and in any case not uni-variable, the insistence of Eurozone monetary policy to focus on inflation only (with the dogmatic 2% target) that has led to many periods of expensive Euro vis-a-vis not only the Yuan and the USD but also the Pound etc, has also contributed to the current Euro crisis (and other factors as well).

But given the systemics and the dynamics not only inside the EU and the Eurozone, but the world (Earth) as a whole, what is happening now is probably the most feasible (but maybe not the best) way for Europe to move forward!

As for the 4 proposals of growth after the crisis put forward by 9 EU member states, allegedly with Cameron's leadership, they seem to make worthwhile reading.

They are the proposals of 9 governments of EU member states, not the 9 states. 3 are Eurozone members (NL, Finland, Estonia). The 9 are basically most of the members of the forum UK-Nordics-Baltics Cameron organised a few weeks ago plus the NL. I should also note that at Davos this year there was an attempt to present and market a Nordic Capitalism model as a model for others, in Europe and the world, to "follow"/copy/be inspired by.

So while the 4 points of the 9 sound in principle good, IMO the Tories must realise that

a) regulation driven burden to SMEs comes from national & local regulations too, not just EU ones! And one could argue that national and local ones are more of a burden than the EU ones (ie the regulations and the directives transposed into national laws).

b) that SMEs need EU-wide uniform regulations, rules, etc, which affects the Sovereignty Tories say that they care so much for!

c) Doha completion within 2011 IMO highly unlikely. Inter alia, Obama has no "fast track".

Now, some relatively harsh reminders for the mostly conservative or liberal governments of the other 8 that submitted the 4 points:

As I tweeted on Friday, the pro open-market govs of Denmark, Estonia, Latvia, Lithuania, Finland, Poland, the NL, Sweden (& the UK) must realise that "open market" means not only mobility of capital, goods - and services as they recommend (agreed) - but also workers/labor and humans in general. Because labor needs as much mobility as possible in order to "compete" in relative value to the other factor of production, Capital! Oh yes!

Those nations that wish to conserve their "national" (altho the UK is a mini-EU) "sovereignty" are to miss out on the benefits of EUropean sovereignty

Angela Merkel decided to abstain (along with Russia and China in the Security Council of the UN) from the UN vote on Libya. The issue is out of my areas of experience and activity so I will not comment. After all, from what I read the SPD and the Greens did not take a clear stand on the same matter either. The issue I feel competent (as an MBA and as a public policy analyst) to comment on is whether it is indeed electoral concerns in state (laender) elections (one more took place this weekend and 2 crucial ones next weekend) that affect to a large extent the German government's demands on the other 16 of the Euro (and especially the GIIPS (I refuse to use the PIIGS acronym)) in the "Competitiveness Pact". We know of the hardcore austerity hawkish POV of the FDP. But as far as I know, the SPD is not exactly austerity hawkish. So how would a less hawkish stance by Angela Merkel in the Pact cause her to lose votes to the SPD?

Ah, c'est l'Europe!

Why a 2% inflation target for the Eurozone and other myths & realities!

1) With February Eurozone inflation at 2.4% (Eurostat flash estimate & 2.3% in Jan 2011), above the traditional 2% fixed (ie permanent) target of central banks, the potential for a rise in the ECB interest rate in April exists (with many side-effects for EZ economies & firms).

But is a fixed inflation target the best policy?

a) See "Rethinking Macroeconomic Policy", by Olivier Blanchard, Giovanni Dell’Ariccia, and Paolo Mauro, Feb. 12., 2010.

b) What really bothers me about all that can be described in the following (part of which I mentioned before recently):

How many policy makers at the EU and the 27 national levels really care about what happens to the micros & SMEs? Especially, the Eurozone ones?

If the EU or the Eurozone has a higher propensity than the UK & US for inflation then consider that maybe that is because of its incomplete single market & union! Then rather than monetary policy, the solution, albeit not of immediate application should be more focused towards making the single market more real and in deciding to move to political union (at EU or EZ level)!

But who has the "nerve" to propose that and tear down many myths?

So why this monolithic fear/phobia of inflation? (1A) should shed some light into that!

Note that for a long time now the ECB rate is 1%, the UK 0.5%, the US 0.0-0.25%! To my MBA and policy mind that means that the Eurozone needs (?) to maintain a higher interest rate than the US and the UK in order to be in equilibrium. Or is it something else? Eg the result of economic dogma? Who's dogma?

I would urge policy makers in Brussels and acroos the Eurozone and the rest of the EU to consider the effect on Eurzone firms' ability to a) export b) defend their markets since the Euro will rise vs USD, Yuan, Pound etc. And the effect on jobs.

PLus: If the ECB interest rate goes up next time (because of what I dare call "inflation-phobia" by some) what will be the effect on financing cost & access to funding of SMEs & of the GIIPS?

Who realises that the EU;s micros & SMEs (and ppl) need EU-wide single laws in everything for the EU to work and provide jobs? I do think that a key part of the EU and EZ problems in insuffcient integration. Another reason why sovereignty IMO can only be achieved at EU level instead of UK, French, German, etc levels. The other has to do with systemics and dynamics outside the EU (see developments in China, USA, SE Asia, Russia, South America, Africa, etc).

Finally, for now, there is a way for the German taxpayer (some like to call Germany the "paymaster of Europe", yikes) to bear less burden in the financing of the EU - Eurozone:

A US-style EU or Eurozone "federal" income tax!

Then instead of Germany or the German taxpayer being the "paymaster" of the EU/EZ, the high income earner in the EU or EZ will! Only fair! Right> So, who is in favor of an EU/EZ federal income tax?

A Catch 22? A Gordian Cord? Who will be/prove Europe's Alexander the Great?

2) German-French Competitiveness Pact: EPP & Socialist summits in Helsinki and Athens

It is Saturday morning and news from Helsinki from Friday's intra-EPP discussion (see Bloomberg's "Merkel Rebuffs Bid by Ireland's Kenny to Cut EU Bailout Costs") show that A. Merkel has the choice: a) Win next fed election or b) Make European history but of course there exists the possibility A Merkel, via her tactics, will lose next German fed election as well as "destroy" EUrope!

3) More on the inflation issue and the apparent willingness of some EZ central bankers to raise interest rates. All we know re February is a flash inflation estimate from Eurostat that puts Eurozone inflation at 2.4%. How about January? Back on Feb 28, Eurostat had published the inflation stats for January 2011. These do not show a significant impact of staple foods.

Read for yourselves:

Euro area annual inflation up to 2.3% , EU stable at 2.7%
Euro area annual inflation was 2.3% in January 2011, up from 2.2% in December 2010. A year earlier the rate was 0.9%. Monthly inflation was -0.7% in January 2011.
EU annual inflation was 2.7% in January 2011, unchanged compared to December 2010. A year earlier the rate was 1.7%. Monthly inflation was -0.4% in January 2011.

Inflation in the EU Member States (Jan 2011)
In January 2011, the lowest annual rates were observed in Ireland (0.2%) and Sweden (1.4%), and the highest in Romania (7.0%), Estonia (5.1%) and Greece (4.9%). Compared with December 2010, annual inflation rose in fifteen and fell in twelve Member States.
The lowest 12-month averages up to January 2011 were registered in Ireland (-1.4%), Latvia (-0.7%) and Slovakia (1.0%) and the highest in Romania (6.2%), Greece (4.9%) and Hungary (4.5%).

Eurozone
The main components with the highest annual rates in January 2011 were transport (5.1%), housing (4.5%) and alcohol & tobacco (3.7%), while the lowest annual rates were observed for clothing (-0.6%), communications (-0.2%) and recreation & culture (0.1%). Concerning the detailed sub-indices, fuels for transport (+0.58 percentage points), heating oil (+0.19) and electricity (+0.11) had the largest upward impacts on the headline rate, while garments (-0.14), telecommunications (-0.08) and rents (-0.07) had the biggest downward impacts.
The main components with the highest monthly rates were housing (1.2%), transport (1.0%) and health (0.6%), while the lowest were clothing (-13.3%), recreation & culture (-2.1%), household equipment and hotels & restaurants (-0.5% each). In particular, fuels for transport (+0.18 percentage points), electricity (+0.12) and restaurants & cafés (+0.07) had the largest upward impacts, while garments (-0.71), package holidays and footwear (-0.16 each) had the biggest downward impacts.

4) A key factor is rising prices of oil and many staple foods (a repeat of the 2008 crisis in the world prices of staple foods and oil or worse?)

A BBC News - Q&A (Feb 3): "Why food prices and fuel costs are going up" is insightful!

Note: According to the BBC "the FAO says speculators who trade commodities on the financial markets are not to blame for the huge rise in prices, but they have made matters worse".

5) Some more recent Eurozone and EU stats (from Eurostat), to get a better picture on dynamics & systemics:

5a) On March 3, Eurostat, published EU and Eurozone volume of retail trade stats (1st estimates):

In January 2011, compared with December 2010, the volume of retail trade was +0.4% in the Eurozone and +0.6% in the EU27

In December 2010, retail trade fell by 0.4% and 0.3% respectively.
In January 2011, compared with January 2010, the retail sales index increased by 0.7% in the Eurozone and 1.9% in the EU27.

Food, Drinks, Tobacco:

In January 2011, compared with December 2010, “Food, drinks and tobacco” gained 0.1% in the euro area, but fell by 0.3% in the EU27.

In January 2011, compared with January 2010, “Food, drinks and tobacco” fell by 0.8% in the euro area and by 1.3% in the EU27.

5b) One day before, on March 2, Eurostat had published industrial producer price stats

In January 2011 compared with December 2010, the industrial producer price index rose by 1.5% in the Eurozone and by 1.4% in the EU27

In December 2010, prices increased by 0.8% and 1.2% respectively.
In January 2011 compared with January 2010, industrial producer prices gained 6.1% in the Eurozone and 6.5% in the EU27. Why?

Monthly changes
In January 2011, compared with the previous month, prices in total industry excluding the energy sector increased by 0.8% in both the Eurozone and the EU27.

Prices in the energy sector rose by 3.2% and 2.5% respectively.
Among the Member States for which data are available, the highest increases in the total index were recorded in Spain (+2.4%), the Netherlands (+2.1%), Belgium and Portugal (both +1.9%). Decreases were observed in Sweden (-1.3%), Denmark (-0.5%) and Cyprus (-0.1%).
Annual changes
In January 2011 compared with January 2010, prices in total industry excluding the energy sector increased by 3.9% in the Eurozone and by 4.0% in the EU27. Prices in the energy sector gained 12.5% and 12.7% respectively.
Among the Member States for which data are available, the largest increases in the total index were observed in Bulgaria (+11.1%), Lithuania and the Netherlands (both +10.3%), and the smallest in Malta (+0.8%), Slovakia (+1.9%) and Sweden (+2.5%).

6) To what extent though is growth in some of the EU and Eurozone member states is pushing prices up?

Eurostat 2nd estimates for EU GDP Q4 2010:

+0.2% from Q3 2010 and +2.1% from Q3 of 2009

Eurostat 2nd estimates for Eurozone GDP Q4 2010:

+0.3% from Q3 2010 and +2.0% from Q3 of 2009

Let's see what the Q4 2010 GDP compared to Q4 GDP 2009 stats look like, ie how fast Eurozone and other economies are growing (source Eurostat data):

Eurozone 16 (whole) and Eurozone 17 (whole): both 2.0%

EU27 as a whole: 2.1%

Belgium 1.8%

Germany 4.0% (!)

Estonia 6.6%

Ireland N/A

Greece -6.6%

Spain 0.6%

France 1.5%

Italy 1.3%

Cyprus 2.2%

Lux N/A

Malta N/A

NL 2.4%

Austria 2.7%

Portugal 1.2%

Slovenia 1.9%

Slovakia 3.4%

Finland 5.0%

Estonia and NL based on not seasonally adjusted data

Thus only Estonia, Germany, Finland and Slovakia are growing (Q4 2010) at rates that are above 3%, a threshold many claim is needed for employment creation.

So is the Eurozone overheating with a 2.1% GDP growth rate (Q4 2010 vs Q4 2009)? To the extent that a 2.3% inflation in January and a flash estimate of 2.4% in February (against a traditional and somewhat "dogmatic" target of 2.0%) aided by global issues in the prices of some staple foods and oil justifies serious consideration by "some" central bankers in the Eurozone to raise the interest rate in the near future?

7) On Monday: Employment, Social Policy, Health and Consumer Affairs Council, 7 March 2011, Brussels. Read more via EUROPA - Press Releases

8) On Monday 7 March at 12.00 CET, the European Commission will issue a decision and press release concerning the historical aviation emissions

9) Antitrust: The European Commission closes probe into Hollywood studios after they change terms of contracts for digitisation of European cinemas.

10) Scottish parliament elections May 5. According to the Guardian, the LibDems are trailing very badly in the polls, as low as 8%!

11) Finally: BBC News reports that China says it will boost its defence budget in 2011.

Let me remind you that according to the CIA World Factbook (estimate) in 2006 China tied with Greece at No21 in military spending/capita, way above USA & all EU except Greece!

PS. So, what it is gonna be: pact or reform? EU27 or Eurozone17+? Schengen style or not?

Outsource This: Thoughts on current dynamics (EU, UK, USA, World)

A solid decision must take into account local, national, regional (eg EU) and global regulatory & legislative constraints. Not an easy time for decision makers then!

Eg business in 2011 will have little in common with business in 2008. In that the conditions & working assumptions of 2008 that affect business have changed radically, it's a totally new "ballgame".

Eg (policy) to address the demands of the times governments need to completely overhaul the philosophy & the existing body of legislation & regulations.


Management: From out-sourcing to in-sourcing?

The competitiveness of economies (for business location purposes) is IMO a matter for the Strategy - Corporate Planning Dept of a corporation to determine, on a case basis. Yet most corporations do not have such depts since many decades ago. Maybe that's the "problem"!

In a few years, some corporations will be outsourcing the top management function of the corp. as well!
Is it time for corporation to start "in-sourcing" their advertising, strategy, IT, HR, functions/depts? #management (back to basics).
The decline of the Roman Empire started when they started outsourcing to the Goths, the Vandals, etc.
The decline of Sparta started when they started outsourcing their left flank to "allies".
And the decline of capitalism started when corporations started "outsourcing" their capital needs to the "markets" & banks rather than their shareholders.

By outsourcing important functions, corporations looked lean & mean in the eyes of the "markets" & analysts but in fact became "anorexic".

Plus, many analysts & commentators act as if they are judges in talent shows, "judging" corporations & countriies as if they are hopeful singers, puting even more pressure on publicly quoted corporations to max performance short term.


Exporters = modern heroes?

Are there mindset factors at play in the loss of exports competitiveness of the US and the UK in recent decades?


Information (and analysis) is Power

The US and the UK are used to analysing the world (think tanks, media, etc).
In recent times, the "world" is also analysing the US & the UK!


Are mentalities and attitudes in the UK but also Germany & France the key barrier to a deeper EU?
a) They dub foreign lang TV shows & films about 3 hours ago via web
b) They are pro EU as long as the EU is molded in their national model
c) France after all almost rejected Maastricht and rejected the pre-Lisbon Constitutional Treaty (in May '05).
d) Gernany's participation in a deeper EU seems tied by the decision of its Const Court.

The EU isn't in crisis this year. It has always been in crisis, because the EU & EEC/ECs were/are built via weird design & flawed project management!


Can a leader lead EUrope and his/her country at the same time?
The obvious answer would be: Yes.
Case study to the contrary: A few months ago Nicolas Sarkozy seemed to be the kind of visionary leader that could steer EUrope forward, through the debt crisis etc. A few monhs later, his proposals and actions in the field of immigration (recall of citizenship, Roma etc) in an effort to please a certain section of the French electorate have tainted his and his country's leadership role in EUrope!


The EU and the UK in a prisoner's dilemma!

The issue of a UK referendum on EU membership is kept alive in the UK. Polls indicate a strong lead againt EU memership (ie exit of the UK from the EU).

A few introductory notes:

* It's the Lisbon Treaty Euroskeptics fought against that actually provides a process for the #UK to leave the EU, should it so decide!!!

* The sovereignty card being played by English and other British Euroskeptics and anti-EUers could IMO actually backfire on England!

* I still think the UK could actually lead the EU into a deeper union! But it would require a major change in mentality (via better info). Read what I mean, below!

* Would the UK have a a) better or b) worse balance of payments if it was outside the EU and its Single Market?

* Would the potential for a deeper - fuller European Union increase without the UK (europhobia) & Germany (constitutional constraints etc)?

* Is a) the #UK b) Germany c) both d) other e) no MS holding back a "deeper" #EU (army, taxation, econ gov, etc)?

Here's my take:

Legal systems in Europe tend to have very different philosophies, eg British vs French vs German vs Italian. Yet another Babel!

Actually IMO better law-making could lead to a very large reduction in the number & volume of laws & better "protection" of people.

Those who fear that the EU leads to laws being decided by the EU institutions rather than national ones are right! A single market needs "single" (or common) laws in most areas in order for the market to be single (or common).

The UK's Euroskepticism is in my opinion justified only in that Euro continental policy & law making is more interventionist (see "dirigisme") compared to the British. The solution to that is a pro-EU UK that leads the thinking towards a deeper union that has better but less legislation (federal & national). A deeper yet less interventionist European Union with single yet fewer and "better" law and "statist" intervention! That is the best solution in the "prisoners dilemma" of the EU and the UK.

If UK and EU continue in their current paths, a lose-lose "divorce" seems inevitable down the line. The UK tradition for less interventionist policy & law making has many allies in all other member states but someone needs to lead the way With or without the UK, a dirigist EU will continue to lag behind the US plus lose ground to the BRICs, suffocating entrepreneurship & citizens.

One has to consider how the union system of the EU suffocates not only companies & growth but citizens as well. Let's take a look at the demographics of the "mighty" (in terms of GDP) Eurozone! A single state Europe is the only viable strategy! Plus: Can one argue that the Germanic states were better off before they were united into Germany in the 1870s?

Can a weirdly designed union of 27+ countries of 500 million compete with a solid 300 million US of A, the 1100 million of India and the 1300 million of China (for GDP/growth, jobs, etc)?

There are hundreds of languages spoken in the homes in the USA! But a single one is used in the workplaces and marketplaces. That means that national diversity can exist, even flourish, under uniform parameters, thus a single state Europe need not supress national "IDs". A single state EUrope is indeed a leap compared to the current situation & the socio-political trends in MS. But without vision Europe is bound for bust.

Otherwise, we might as well move back to a city-states system! Like eg pre-1870s Germany! Or Ancient Greece! With Germany, France and the UK vying for the dominant role, like Athens, Sparta and Macedonia or Thebes (Spain?)!
Ancient Greece has similarities to modern Europe. Greece did not become a single state until 1831 and after Roman and other occupations. When will Europe then become a single state? In 3010 or 4010 AD?

Without English as its lingua franca (in the workplaces & markets) the EU will remain a quaint linguistic Babel for American & other tourists! A real single EU market needs banks with connecting branches all over the EU, the ability to be serviced by a single mobile provider no matter where in the EU one lives, an EU-wide "NHS", an EU income tax system that encourages mobility, etc etc!

Anyway, in 50 yrs, Europe will probably either be
a) a single country OR
b) a huge museum for American, Japanese, Chinese, Indian etc tourists.

Probably the latter!

A continued Euro-chaos as now? That option actually leads Europe to the museum I mentioned.

I propose you also read my post: Britain and the heart of Europe, in 2005 (and today)


The pseudo-immigration problem in EUrope:

... of non-EU and intra-EU "immigrants" is IMO one of the reasons the EU will remain un-competitive in the world while the BRICs & US will do much better!

Intra-EU "migration" isn't supposed to be "migration", just like intra-EU sales are not considered exports/imports. Yet it is not treated that way. Maybe that's the problem with the EU. Most things are not clear cut, they are half-way, thus confusing the average person & firm. Everything EU is vague (flou). US-style inter-state relocation doesn't require a single EU state though. And sovereignty is another "flou" subject, globally! Ie what constitutes "sovereingty" in 2010 is quite different than in 1910, 1810, 810!

The population of a new member state should be given the same transition period constraints re relocation to one of the "old members". Not the current pick your choice between 0, 2, 5 and 7 (I think) years. In 2004, the UK chose a 0 years transition period for population of the "A8" new member, while many member states chose 2 years and 7 years (!!) was
chosen (I think) by France & Germany! Quite uneven! 2 years for all by all should be the policy, IMO.

But at present, EU citizens' freedom of intra-EU, inter-state relocation is not as free as intra-US, inter-state freedom. Alas EU laws don't give EU citizens per se freedom to relocate, only give it to those who find job, start biz or have means not to become burden on the state. But does not apply to intra-US "migration", eg when a Californian moves to New York or vice versa.


Certainties about Uncertainty & Economics vs Physics

There is an ongoing debate re the certainties of Economics and its similarities and difference with sciences such as Plysics.

This is my take:

Between certainty and "que sera, sera", there is a lot of room in between! A lot!

Having studied Prob/Stats, OR (Operations Research) - Decision Sciences while at MIT & NU & Finance at INSEAD I wouldn't over-estimate their ability to predict.

How many are aware of the maximum efficiency frontier on a E(return) vs E(risk) table, anyway?

The trade-off between expected return and expected risk (curve) remains one of the most not understood Financial (and decision sciences) concepts.

The use of either perfect markets or perfect information hypothesis in most Economic theories & analyses waters down the realism of the results.

In spite of the use of fancy math formalas in recent decades Economics (including) is still a Social Science. Physics is a Natural Science.

I used math/OR to try to better assign aircraft to flights in my MS thesis (1987) but didn't claim I was actually optimising, ie finding an exact or perfect solution!

A lot of Economic & Financial stuff these days seems more like product of a "religion" (see dogma/dogmae) rather than a science!

Economics, including macroeconomics, is a useful tool, but still not Physics" or able to predict/assess with the certainty we read quoted in or by well known media etc!

In other words, I agree with the conclusion in Legrain's Aftershock book but of course Macroeconomics is not Physics. Riccardo was not Newton!


Spare thoughts:

WTO -Doha: Have the US Congress & Senate given Obama the "fast track" powers GW Bush had?

UK exports in Services: £3.8 billion surplus on trade in services in July, surplus of £3.6 billion in June. Not too bad, eh?

Civil Society will make or break the European Integration

Banking and Finance are not the core of modern economies

SMEs must take a more proactive approach to European Integration

Hungary says will meet euro criteria by 2014-15

Competitiveness. growth and employment in 2010

How many countries nowadays have a competitiveness model that is "working" and takes into account the global systemics? Are global systemics too complex and/or volatile for any country to develop a competitiveness, growth and employment model that works?

Is the present and future type of new jobs in the USA United States mostly low skill - low pay ones? In the EU? Can any model avert that? IMO, yes.

Goals or exports?

What is more important? The performance of a country's national soccer (football) team or of its economy?

Sovereignty in 2010+ terms

Decisions re self/household, company, country require effective awareness of both internal and external systemics and dynamics. Are you aware how economic, financial, political, policy and other systemics in the world affect your household, your company, your country?

How many households, companies, countries have the ability to adapt or capitalise on global and regional new systemics, dynamics, trends? IMO this ability of a country to adapt or capitalise on global & regional new systemics, dynamics, trends constitutes "Sovereignty" in 2010+

Business, socio-economic and competitiveness (systemic) modeling

A lot has been written in about the economic situation in the last 3-4 months re the economy and "systemics" of my native country. So here is a brief view of mine on a potential new "model" for Greece.

IMO, Greece needs a very innovative - tailor made business, socio-economic, competitiveness model that probably defies the conventional thinking in IMF, EU, ECB, etc:

A model that will capitalise on year round tourism services as well as intellectual products & services, driven by uber flexible micro firms.
Complete overhaul & simplification of public sector, laws & regulations re everything; relatively low but simple taxation; decent welfare (NHS, etc) for all; inside the Euro of course. But for, that Greece should ask for urgent creation of a real EU Single Market (as opposed to the existing not-so-well working one) for goods, services & work, for all sectors; and improved EU competition law to protect micros in the EU Single Market. As well as lead most others in demanding new Euro policy vis-a-vis USD, Yen, Pound, etc.

Beyond the national vs global debate

IMO globalization is not cutting it in its present version and that is largely the main cause of the re-focus on national levels in recent years. The same can be said of one of the main aspects of globalization, free trade. Having national leaders and other key figures make pro free trade and anti protectionism declarations, IMO, does nothing to address the systemics factors behind a) the protectionist and b) national focus dynamics of recent years. Free trade does produce extra world GDP but one has to consider and discuss who gets most share of that "added value" from trade and any other benefit of a global focus. And I re-iterate my view on the need to reconsider David Ricardo's "comparative advantage" theory, with relevance to modern systemics and dynamics.

Rethinking Ricardo's comparative advantage theory

The free trade vs. protectionism debate is current these days.

Does David Ricardo's comparative advantage theory hold water, at least in this era?

Irrespective of Paul Krugman's proposal to slap tariffs on Chinese products to confront China's yuan policy, a key question for the US and Europe is: Can economies like the US & EU be sustained by Services & intangible - intellectual products (& their exports)? In other words, can they depend for the industrial products on the world markets?

The effects of US immigration policy on its world competitiveness and lessons for the EU

This is my working theory, from a systemics point of view:

1) How has a much more restrictive immigration policy by the US in recent decades affected its competitiveness + exports in recent decades?

2) What lessons are there for the EU?

Those who frequently read my policy analysis tweets and/or my blog posts know that I like to do compare and contrast exercises between the US and the EU, especially from a systems analysis - systemics point of view, in other words, compare and contrast the US and the EU as socio-economic-political-policy-general models. Not that I think that the US should or can "copy" the US (1) (or vice-versa), but I do think that this type of exercise can yield useful insights re potential EU and US "re-modeling".

In my recent 4050 words submission - contribution to the European Commission's public consultation on an EU 2020 Strategy I argued, inter alia:


IMO, part of the competitiveness of the United States, until a few decades ago, was it near open door immigration policy (this has changed in recent decades). For many decades the US was the natural destination for anyone in the world who felt suffocating in the confines of his/her native country. The EU should IMO adopt a much more open door immigration policy towards third country nationals who wish to make the EU the arena of realisation of their ideas and dreams, thus partaking in the “EU Dream”.

I also pointed that the role of the US as an academic and research "powerhouse" pst WWII seems to have done nothing to avert loss of its industrial base to Japan and others and now China.

My thesis/theory is that a major cause for the loss of competitiveness of the US in the world is that its immigration policy in recent decades has largely deprived it of the "wild spirits" (a la Schumpeter, “Mark I”) that it used to attract.

Why is that?

Because
1) whereas providing a home for political - asylum seekers was of course a noble and fully justified policy
2) whereas PhDs and other highly educated specialists did not cease to be given residence status in the US (and to contribute to the US needs for high level expertise)
3) whereas the "US Green Card" lottery may seem a tad strange but does play some role in enriching the make up of the US population

The above 3 could not and did not IMO contribute per se to attracting the "natural" wild spirits, the venturers of all kinds and entrepreneurs, that used to find fertile ground in the US in previous decades and centuries.

Of course some of the persons who qualified under (1), (2) and (3) above may have incidentally fitted that profile too, but eg one does not need a PhD (or even an MBA) or other "objectively verifiable" skills or knowledge or past achievement in order to turn out to be a venturer or a value adding entrepreneur.

Thus, according to my theory, whereas the near open door policy of Ellis Island and later years did allow the wild spirits to relocate in the US and produce their added value as part of the US GDP, including exports, the later immigration policy of recent decades highly restricted that access. And that the "deficit" in such wild spirits "capital" in recent decades has contributed most significantly in its competitive demise.

For Europe, a place where "wild spirits" (men and women) used to flee from right from the early migrations West, because of its suffocating national situations, especially social and related, in the 17th-20th centuries, it has no tradition of attracting wild spirits, as the US had. On the contrary. In addition, in the last decades, via the EEC and then the EU, and now a common immigration policy, the EU offers at present, even fewer avenues than the current US immigration policy does for attracting "wild spirits" (as I described them) from outside the EU.

Should thus the EU formulate a much more open immigration policy as a mean as attracting among the immigrants from outside the, wild spirit capital that can help it innovate, venture and enterprise more, not only intra-EU (inter-MS) but in the world economy and markets of all kinds?

Of course, this alone may or may not do. Where are the hubs or clusters of world class new thinking and venturing in the EU? Does the EU have any? Examples? But that is a topic for a separate post (or posts).







(1) I have actually argued in many tweets and blog posts that the EU could not become a US style "United States of Europe"even if it wanted to (which it seems not to want to anyway).

Survival of the cheapest?

The "survival of the cheapest" culture.

"Value" seems to be a key word in today's societies. Yet, I argue that "value" is a term without any "real" meaning, at the end of the day. I am even prepared to argue that the notion of "value" is misleading in today's market systems.

I propose that the concepts "I deserve" or "what is my value" have no face .. value in the market.

Cost, utility and price are terms which have more applicability. They are more "real" in market terms. What is more, these terms go well beyond economics. Supply and demand, cost, utility and price are not necessarily measured in money. After all, money is but a measurement tool.

It's about give and take, transactions, exchanges. It's about supply and demand, economic or "non-economic".

And price is after all, as I learned in my college economics courses, the point of equilibrium between supply and demand.

My thinking is not economic, it is interdisciplinary. After all, I have had some training in economics, but I am not an economist.

Utility is also a relative term. What is for example is the utility of a match in a desert island? For a non-smoker, for a smoker? A smoker who has cigarettes nut no matches or a smoker who possesses neither matches or cigarettes?

What is "quality"?

To me, "quality" means standardisation. I.e giving the same every time, with minimum variation.

Machines offer quality. Humans offer "value"

There lies the strategic problem for humans in today's "Globalia".

If humans have a competitive advantage in producing "value", and "value" is an irrelevant term, then where is the bottom line?

With more and more manufactured goods being produced in China and services offered remotely from India, what will Americans and Europeans produce in the future (assuming that globalisation and free trade do not fall to pieces)? How many services, even offered locally, cannot be based on survival of the cheapest?

Maybe our future lies in relocating to China where cost of living is much lower!

I propose that the competitive advantage of the USA and Europe (OECD countries) lies, for a while at least, in capitalising on the relative and volatile utility of intangibles.

The competitive advantage of the human factor (vis-a-vis capital and machines) lies in producing goods and services with high intangible added-utility (e.g. branding).

I also argue that humans, after all, are at their best not in repetitive, but non-repetitive, creative, intellectual, based "products".

When you play not to lose, you play more conservative football (or soccer, if you prefer)!

Humans will beat the machines by capitalising on what makes them human.

Let us assume that in the future, robots and other machines produce most products and services. Humans will then have a lot of time on their hands. But what about money?

Will we all get paid for being poets, painters, singers and doing other ultra-human activities?


Living with "too many" options?

Freedom of choice and availability of many options does requires a "philosophised" person, ie a person who knows what he/she wants and does not want and has developed a personal philosophy on life, as well as not being lazy in using his/her brain. no matter what the IQ is.

I can thus see how some people and daters may prefer totalitarianism, monopolies as well as not like the benefits of online dating, for them and for others!!!!

Economic modeling UK, Germany, EU, etc

Some more thoughts on economic and general "modeling" (socio-economic, etc) in view of current trends and dynamics:

a) Do countries in our era need to be large enough to have a sufficient internal market for economic sovereignty?

"Large" enough in terms of what?


Plus:

b) Is it prudent for a developed + Services based economy to rely too much

1) on the Financial Services sector of econ activity? (is the UK one of them)?

2) On exports (eg Germany, South Korea, Taiwan, China, etc)?

The UK's problem is not "Europe" but ....

Someone has to start telling the British people the truth re the value to the UK from EU membership.

The UK's problem is not its EU membership but the faulty socio-economic and competitiveness model of the UK in recent decades.

The UK's interests are not in leaving or holding back the EU but in leading the EU into a deeper and working Union for all

Another factor that is failing the UK in its ambitions is the quality of the primary education, the basic skills it provides

The English Premier League and its success, at home and in #Europe, is an excellent example of what the UK 's model should be