The tuition issue will probably always haunt Nick Clegg

Paddy Ashdown's 2012 decision  to lead on the LibDems' General Election campaign is great but I am afraid that the damage done to the credibility of the LibDems due to the tuition issue will, alas, probably always haunt Nick Clegg.

Agorocracy vs. Democracy

Four years ago (June 2010), I was pointing out how Agorocracy vs. Democracy were fighting it out in EUrope and the world. How the financial system had gone out of bounds compared to other aspects of our lives. Since then, 44 months have passed. The speaker has slimmed down (see video) and so have the budgets of Greece, Spain and other troubled Euro member states.

Cyprus banks got a haircut last year.

But what is the state of the competition between Agorocracy and Democracy today, February 2014?

2012 Review: US vs EU models (dreams vs quality of life)

Even in 2012, US and EU systemics point to:

US best to pursue your dreams, EU best for quality of life.

In 2012, quality of life in the EU27 took a further beating and the European Social Model (with its variations) is under threat, with the "excuse" of austerity. As I have pointed out before, various private sector interests are eyeing the "filet" and other parts of the EU27 health "market"/pie, encouraged, inter alia, by the block of the Obamacare public option in the US in the first 2 years of the Obama admin.

The US, in spite of the continuing bureaucratization of US life and economy (to some extent one could label it, Europization), by comparison to EUrope, the US continues to be a better place for one to pursue one's business, tech, entrepreneurial, artistic, sports, etc dreams, and succeed or fail (and wind up even homeless) when doing so (hence the relative absence of safety nets compared to EUrope).

In 2013?

2013: What the times call for is for governments to ...

Topic (summary):

What the times call for is for governments to get their act together and govern, via better planned and implemented policies.

Topic (introduction):

In countries such as the UK, one has seen a rise in voters and parties that are anti-Brussels and increasingly anti-Whitehall, in a way resembling the Tea Party ideology and dynamics. They challenge the role of the state as well as of governments.

How can this dynamic be addressed? In my opinion, what the times call for is for governments to get their act together and govern, via better planned and implemented policies. Policies that address the real issues faced by citizens in their daily lives, in policy/comprehensive ways not in theoretical or crisis management manner. There is an urgent need for better public policy rather than PR/image making by governments and political parties.

My reference sample is the EU27 (EU and national levels) and the US, two regions I monitor closely.

Merkelian logics

Merkel's Euro policies qualify for a saying: It's all German to me (compare with the origin of the original saying).

In other words, "Europe" is not "speaking" German, as Volker Kauder of the CDU hoped/argued/boasted at a CDU conference one year ago.

Note: He meant German (CDU) policies not German per se.

Btw, Merkel today said that she does not rule out another CDU-SPD coalition after next year's elections. With FDP doing the way it is, of course not.

Scylla or Charybdis in modern economics

National oligarchs or international oligarchs and corporate and other bureaucrats? Scylla or Charybdis? Where/who is "Ulysses"?

Oligarchs or free grazers? I remember a Kevin Costner cowboy movie on this type of dilemma!

Should all economists live in Greece of 2012?

My first two university degrees were focused on decision sciences as applied to transport(ation) systems: traffic, public transportation, trains, corporate logistics and of course, at least in my case, airports and airlines. I have not really practiced the trade, except for policy analysis of EU transport policy. I used to say and I believed it that any transportation analyst/planner should spend some time working as a taxi driver. I have always been inspired by international (long haul) tracking as well. Maybe I should have practiced one of these two professions anyway. Maybe.

But my point, by some analogy, is that any economist should spent significant time living the life of "people in the streets" of economies such as the Greek economy in 2012 (the econ stats of which are, they say, comparable to the ones in the US during the great crash 80 years ago). How long for? I would say at least 4 months, maybe 6. Maybe even a year.

Living in too financial times

We do live in (too) financial times! Ie cursed interesting times. A combo of high finance and China effect, that is.

The oxymoron with/ modern finance is that if your rating is undermined in/by any way, you are thrown down a cruel spiral. Good luck getting out.

Does it make systemic or logical sense? In my opinion, no!

Systemics and Dynamics Live NP Blog, October 31, 2012

Read bottom up to follow the flow:

Evening:

Euro crisis/Troika:
I thought memorandums were supposed to be brief, not as brief as executive summaries, but brief.

There seem to be 2 divergent views re the effect of Sandy on US economy: a) disruption of the recovery b) growth stimulus effect by money spend on the damages, multiplied by a greater than 1.0 factor. As per electoral effects, some think it may prove beneficial for Obama and Dems if seems presidential in his dealing with Sandy effects is deemed effective. Or could backfire. Will it also restore some faith of people in "government" and make collective esprit (eg health care) more popular. Guess we shall see.

Early morning:

EU/Euro/econ/fin crises:
Many admire the Iceland "model" of dealing with it. But they should recall it has a population of 320,000, a total area of 103,000 km2 out there in the Atlantic and a volcano!

More philosophical:
The problem with parents raising their kids with prince/princess aka noble values is that unless they also give them a Principauté, they are in for a rough ride in the "streets" of life.

Philosophical:
Hard times for "princes" and "princesses" (not the real ones, the other ones). Also hard for vagabonds, though. Unless in warmer climates.

Jobs/Career:
For decades now, searching for a job had become a job. In recent years, it has become a career.

Systemics and Dynamics Live NP Blog, October 30, 2012

Read from the bottom up to follow the flow:

USA:
Time for allegiance between people > Obama to the Rescue | The Big Dog Barks | No Time for Politics? http://t.co/bZw1okwP Nature is showing who is the real boss, and should make lots of people think about human-to-human allegiance and the role of  government in the US. May thus help the Dems + Obama

Greece:
Had the Greek gov't in the 1980s established a real unemployment benefits system, like other EU, maybe Greece would be different today.

Econ:
No kidding! RT @ForexLive: Merkel/Lagarde: Global Economic Recovery Remains Uncertain http://t.co/B3yRytd6 Oct 30, 2012

Info, what info?
What unrest(s) in ATH/GRE? Most if not all events have taken place on/near 1 square. Intern media have made it seem wider.
 
Roesler/FDP:
Roesler "strikes" again re Greece, but will this campaign save his FDP "Empire" in next GER elections? #EuroWars #EmpireStrikesBack

Greece:
Now all Greece needs is a Tea Party. #stoicgeek
Was it a 2-way call? Mobile or landline? Roaming fees? Smartphone or not?

Merkel:
She is a politician too, But that is why she gave GR such a hard time, to make sure, she thought, no one else would ask 4 for same. So she thought,

Banking Union:
The EU or Euro or Euro+ shouldn't be banking on banking union as a facility towards political union. The road is different, political/civil

Labour Market (EU27):
Call me again when the #EU gets a labour market, instead of 27. By that time, there will be no labour, only robots and stepford workers.
For labour market reforms to have a raison-d-'etre, there has to be a labour market, dear Troika! #EU\

News vs Opinion:
Who cares what someone said about anything? That's not news, that's opinions. Cool but not real news, is it?
Sandy left death and damages, some member wants to leave EU, EU squabbles, GR is complicated, etc etc. The news? Oh c'mon, you know the news (EU, UK, US, etc). Same old, same old.

EU27:
If the 27 cannot agree on EU budget, why not make it a federal one with 26, 20, 17 or 10? Anyway, not the budget but the policies that count

Caprica:
NYSE re-opening tomorrow! Sure, finance does not need humans anymore! #Caprica #Sandy Oct 30, 2012

Troika/Greece:
I don't care what Troika says, the Greek competitiveness-growth-employment model has to be based on free lancers, and exporting micros+SMEs
For whom are the labor market reforms many in GR oppose??? Most of the "private sector" was always free lancers and even more so today!


EU Regional Policy:
EU funds diverted the attention of Objective 1 (PIIGS) from EU policies and effects. PIIGS would have been, I know it's a heretic view, better off w/o them

EU?
Let's face it. EEC/EU has not really been a union, more of a FRA-GER-UK thing with associate members the rest
Maybe EU better off w/o GER, FRA, UK, tho. A more real union.

EU and PIGS as family:
Some would even say a family is not real unless there are internal fights. Look at ancient Greeks! lol Oct 30, 2012
Greeks fight each other all the time they r still a family.The best of families do. But they unite when needed
3//3 Or Germans., Dutch, Finns, Slovaks, Austrians et al can move to the PIGS now and enjoy real life! #MoveToTheMed4RealLife
2/3 Of course they can wait 50-100 yrs, global warming will turn Euro core etc into PIGS and PIGS into Sahara
1/3 The truth is that many other EUROpeans envy the PIGS cos of their sun, sea, sand, zest, instead of rain, cold, esp Humidity.
 EUROpeans want(ed) a stable currency but not the extra hard EURO-DM it turned out to be (at 1.4, 1.5 times USD etc) Oct 30, 2012

About the UK:
It's complicated: Everything is simple. So simple that it's complicated.

Not quite. "Other" economies had been spoiled by Eurozone's impors from them. RT @MStarDirect: Eurozone's troubles hurting other economies, chiefly E. Europe & Latin America. Latin America also feeling pinch fr ...

My take on Greece:
My main "take" on Greece is that no one's take, including mine, is accurate. That's Greece. Un-takeable. That's my main take on Greece.

A new EU industrial policy? Can the EU be re-industrialised?

I read on Twitter yesterday that the Cyrpus presidency of the Council of the EU, is focusing on a new EU industrial policy.

These are some of my thoughts on the subject (fuller analysis available upon special request):

New EU industrial policy? Horizontal (Bangemann) or sectoral? Inside or outside the WTO?

The EU cannot be re-industrialised w/o a different trade policy and/or w/o radical EU integration into a single force. The rest is wishful thinking, imo.

The EU2020 "strategy" was naive to begin with plus was undermined by austerity (see cuts and/or privatisation of education in many member states (eg UK, Spain, Greece, etc) and cuts in R&D spending due to austerity).

Real policies for the real economy

Real policies for the real economy

And real regulations for the financial economy/matrix.

They are both urgent needs.

In search of (some) consistency

There is a case to be made for:

a) free trade
b) managed trade
c) fortresses

But each model has to be consistent not "have a cake & eat it too" stances by some countries that think that they can adapt the rules of the game as (they think) it fits them.

If you want to be a game changer ...

Game changing is a buzz-concept these days.

But IMO:

If you want to be a game changer, first you need to understand the game

Searching for the centre

Both Britain and Greece (as well as other countries, including the US) urgently need a genuine centrist political party that can address the policy challenges of the era without ideological sclerosis, using right of centre and left of centre and other policy tools to solve real problems of real people, in the real economy, the real society, in an ever complicated EU and world (WTO, UN, etc).

Can the LibDems be that centrist party in Britain?  They can, but they are not and do they want to?

Good houskeeping, the European social democratic way

Good "housekeeping" in the EU member states is always a must but Sarkozy, the current Dutch government, Merkel and others must be sacked for obsessing about it!

For setting targets that are too unrealistic, in terms of the actual numbers as well as the whole philosophy of setting strict targets and obsessing about reaching them. That is also a problem with inflation (the 2% "magic" target), even the targets of the Europe 2020 "growth Strategy". Economics, including fiscal and budgetary ones, are not like Physics or Chemistry, they are part of social sciences and as such they must be treated with a grain of salt. People are not robots, neither are their economic, social, political and policy  actions.

Some politicians are willing to bend to the demands of financial markets.

Since many years ago I have written about the demands placed on listed companies by the financial market. The pressure to meet specific targets on a quarterly basis. And the negative impact that this has on the medium term performance of the corporation.

In recent years, the same pressure is being put on countries, their economies.

Time for that to stop! That should be one of the philosophies of the social democrats in the EU27.

Of course states, as companies do, need to improve their accounting procedures, know what they are spending and why (the why part is management accounting as opposed to financial accounting). To keep their finances solid but without "human sacrifices" of the obsession austerity kind. The preservation of the European Social Model and the need for the recognition of the positive role economic immigrants can play in the funding of the social model of an ageing EU27 (instead of scapegoating them).

To make a humanist EU the beacon for others in the world, since the American beacon has been dying out in recent decades (see also the resistance to not only HillaryCare of the Bill Clinton 1st term but also of Obamacare, especially the public option).

In a secular Europe, economic religions such as growth via austerity, classic, neo ir ordo liberalism and of course neo-Marxism have no place! Policy must provide solutions for real problems of real people.

On enterprise and legal certainty in the 2012 world

"Argentina's "unilateral and arbitrary" decision amounts to an attack on the exercise of the free enterprise and the principle of legal certainty" says a resolution adopted by The European Parliament on Friday.

The EP also says that the European Commission should use all appropriate dispute settlement tools available at the WTO and G20 to respond to Argentina's "unilateral and arbitrary" decision to expropriate the YPF energy company.

Whereas I am not taking sides because I am not aware of the full details of the specific issue that involve a private company (and a formerly private one), here are my POLICY related comments.

1) Does Cristina Elisabet Fernández de Kirchner's (Argentina's President) concept of national sovereignty vs David Cameron's one. Compare and contrast.

2) Not sure WTO rules cover such issues (as well as many other global economic ones). Is the EU asking the WTO to become an agency of global economic "governance" (compare and contrast issue with the issue of "economic governance in the Eurozone). What can G20 do or can do withiu its present and appropriate role? This case is maybe one more reason in favour  what I have been arguing re EU and US exit from the WTO and reliance on bilateral full topic agreements (covering trade, investment, economics, immigration, etc) between eg the EU and Argentina or EU and Mercosur or UNASUR.

3) Re the EP's claim that "Argentina's "unilateral and arbitrary" decision amounts to an attack on the exercise of the free enterprise and the principle of legal certainty. Are there not many many other factor that "attack" free enterprise and especially legal certainty inside the EU and the Eurozone? Such are polynomia (over-legislation) and red tape? Eg the absence of EU direct tax competency and laws?

4) I have commented before that the G20 membership is high on anti-protectionist rhetoric and low on reality,  with many and significant hidden protectionist practices and barriers to trade.

Thus, no matter who is "right" in this case, this case serves as yet another food for thought stimulus for the policy issues I raised above.

PS. I have argued that given the global dynamics it is maybe time for the EU to raise its walls (economic fortress), rely on bilateral agreements, not WTO (see China effect) and develop a common and humanist immigration policy for economic immigrants (after all, the EU27 population is ageing and needs external population boost, for reason including the viability of its Social Model). Bilateral economic agreements are a good place to include bilateral economic immigration agreements.

Sacrifices in 2012

The Incas  (see article) and other ancient civilisations were sacrificing humans to the gods, the modern world to the "markets" esp. the financial one. O tempora!

Until when?

What's really wrong with austerity a la Merkel et al?

What's really wrong with austerity a la Merkel et al?
Greece is a good case study of that. Too much, rigid, austerity, without a growth element.
A result of Ordiliberalism? Still not convinced?
Or is it a result of the type of the philosophy Max Weber described in his 1905 book "Protestant Ethic and The Spirit of Capitalism"?
Or a result of austerity that focuses on such rigid targets that even the Dutch or Germany itself has trouble adhering to (thus opening Pandora's box, see eg the German and French violations of the Stability Pact in the previous decade)?

There is no question that not only Greece and other so called "PIIGS" as well as other Eurozone, EU and OECD countries need to consolidate their budgets.

The issue is how. How fast, how strictly,and with what policy tools and side-effects (including unemployment and social systemics).

A somewhat "fundamentalist" approach to austerity is what makes the so called Fiscal Compact, proposed by Germany in December and signed (but not ratified yet) by 25 in March such a hard pill not only for the PIIGS but also for NL and even Germany to swallow.

To paraphrase a slogan re taxes, too much austerity (planned) = no austerity, or failures of the austerity dogma all over Europe!

Ordoliberalism, with its insistence on separation of economic policy between fiscal (by governments), monetary (by 100% independent central banks) and macroeconomic (by market actors, eg social partners) , leads to un-cordinated economic policy, even at national level.

The capitalist dogma that to be helped, "sinners" must prove worthy, is another (faulty) fundamentalist element.

Fiscal fundamentalism is not going to help Europe. No fundamentalism ever did.

The proper economic and other policy mix is needed. But who knows how to get that mix right?

No more economics - and especially finance - please, we are humans!

I am paraphrasing the title of a well know British theatre play of decades ago to reflect the following.

Muhammad Yunus, the inventor of micro-finance has given a most interesting video interview to the Guardian today: 'Economists have misunderstood human beings' is the title and he proposes that humans are multi-dimensional, not one dimensional money making robots!

He also proposes that social enterprises can offer solutions in a world where the profit making ones and the social ones co-exist.

Meanwhile, the Merkozy fiscal pact is having adoption issues not only in Germany (see recent posts of mine) but the Netherlands as well! My POV is not that good fiscal "housekeeping" should not be an element of national and Eurozone policy but that this must not turn into the sclerotic and rather rigid thing that the Merkozian fiscal pact has become! So much that not only a Spanish convervative PM (Rajoy) is having trouble abiding to, but also the Netherlands. Yes the NL which is the closest "ideological" ally Merkozy has to its philosophy,

Via Twitter, I continue to ask my German followers/friends if indeed "Ordocapitalism" is the philosophy that drives the policy thinking of Merkel and her advisers (many of them of CB and/or banking mindset). I continue to get very mixed replies. Too early to write a post on that.

So capitalism and its problems, which was the topic of thus year's WEF at Davos, the Euro crisis, the vendetta between Financial Agorocracy and Democracy, and many other such issues continue to be the core of European, EU, US and world affairs and policy.

Now, back to Yunus. I have many economists friends but as an MBA I agree with Yunus on this argument taht economists have misunderstood human beings.

As per the profit vs social entrepreneurship, I think that there is also a "third kind". The for profit but not profit (shareholder value) maximising one, the one that my father practiced, ie for profit business that does not operate with a single directive: "Maximise Profit, Maximise Profit" (flashes of The Terminator, The Walking Dead and other zombie and vampire movies and series, parade inside my mind for a few seconds). What I call "noble capitalism" (mind you: my father was not a "royal", he was a product of the middle class, the good old middle class that credit capitalism has destroyed in recent decades, IMO).

After all there is such thing as "Socially Responsible Investment" where investors can participate in funds that choose their portfolio based not solely on performance but environmental, social and other non direct profit parameters!

But is it economist who have misunderstood human beings or is Max Weber's 1905 book "The Protestant Ethic and the Spirit of Capitalism" that is more relevant in understanding a) the faults of capitalism and b) Merkel's philosophy?

Food for thought, mes amis!