Tuesday, 2 September 2014

Ukraine: the risks of transition

Ukraine misrepresentations and lies, coupled with ignorance are fuelling  widespread displays of media propaganda.  There exists a factual skeleton that cannot be propagandized away though.

It is not in Ukraine or Russia's interest to partition the country.

The Kiev government has lost control of eastern and southern Ukraine.

Calling parliamentary elections in Kiev when so much of the country, with millions of voters,  is no longer governed from Kiev, is a democratic farce.

The current Kiev caretaker government  is widely regarded as Fascist by many and, in some parts of Ukraine, the majority of voters.  Any attempt to validate the agreement with the European Union by the current Kiev government will be regarded as illegitimate by much of the population.  And by Russia.

The response to this has so far been disastrous.  At least 2000 people have been killed.   The EBRD has produced a worst-case scenario in which the sanctions implemented and threatened against Russia will precipitate a Russian recession and bring growth to a halt in the area; there will be serious contagion throughout the global economy and, first, for Europe.

All European former socialist economies have distinctive features arising from their soviet-type starting model.  Escorting them and assisting them through transition is now a well-understood process, if hotly contested by those who want to punish the former socialist errors (and socialists), and those who seek to provide the best route to an economically and politically successful society.

Such a society would not  conform to the hyper-liberal, crony capitalism so beloved of the corrupt of all capitalist economies (sadly only too well-represented in some of the already 'transited' states that fought back to create a more balanced and indeed moral, as well as efficient,  economic and political system and thus largely completed the transition). 

Abolishing or reducing to a minimum the role of the state in transiting economies is not clever.  Market institutions must be created, there must be investment in modern infrastructures (just consider the backwardness of the highly inefficient energy consumption levels of Ukraine industries), market regulation must be a state function, and for any reasonable person there must be great importance given to the provision of employment, the alleviation of poverty, and the assurance of social peace.

Russia will not accept Ukraine (or any other near-abroad state) practising the politico-economic aggression of hyper-liberal, crony capitalism.  In the interests of its defence requirements it has formally annexed the Crimea.  Informally, bluntly, it has annexed also Ukraine as a whole, rejecting the kind of development that will lead to  an unstable and inegalitarian capitalist free-for-all.

Central Europe - Austria, Germany, Hungary, Poland, The Czech Republic - really doesn't need this pseudo Europe of the UK, US, and Baltic peripherals, trying to put tanks on Russia's lawn.  

Wednesday, 23 July 2014

Plus ça change

https://www.youtube.com/watch?v=gjndTXyk3mw


Monsieur le Président je vous fais une lettre
Que vous lirez peut-être
Si vous avez le temps
Je viens de recevoir
Mes papiers militaires
Pour partir à la guerre
Avant mercredi soir
Monsieur le Président
je ne veux pas la faire
je ne suis pas sur terre
Pour tuer des pauvres gens
C’est pas pour vous fâcher
Il faut que je vous dise
Ma décision est prise
je m’en vais déserter
Depuis que je suis né
J’ai vu mourir mon père
J’ai vu partir mes frères
Et pleurer mes enfants
Ma mère a tant souffert
Qu’elle est dedans sa tombe
Et se moque des bombes
Et se moque des vers
Quand j’étais prisonnier
On m’a volé ma femme
On m’a volé mon âme
Et tout mon cher passé
Demain de bon matin
Je fermerai ma porte
Au nez des années mortes
J’irai sur les chemins
Je mendierai ma vie
Sur les routes de France
De Bretagne en Provence
Et je dirai aux gens
Refusez d’obéir
Refusez de la faire
N’allez pas à la guerre
Refusez de partir
S’il faut donner son sang
Allez donner le vôtre
Vous êtes bon apôtre
Monsieur le Président
Si vous me poursuivez
Prévenez vos gendarmes
Que je n’aurai pas d’armes
Et qu’ils pourront tirer.

Friday, 13 September 2013

Italian Meltdown

Prime Minister Enrico Letta, the Uriah Heep of Italian politics, has admonished us all for our persistent lack of respect for and acceptance of his administration.   We are costing the country billions of euros which could be invested in economic recovery if only we would settle down under the informally installed Troika-style arrangements agreed and steadily installed, over every political democratic resistance, since 2011.

Looking out over the smouldering ruins of the country's institutions, with the only edifice left standing being that of  the president of Italy, now almost 90,  attention is caught by the  new front opening in the real economy.  Entrepreneurs have been shutting down plant for years and shifting to production in Serbia, Romania, Bulgaria, Turkey, Poland and even the United States - shifting production to China is a decades-old practice - but the abandonment of factory and plant without hope of any further subsidy-farming is now being replaced by the abandonment of work-forces without provision for their welfare support.  Not to mention the physical trucking of machinery and key-skills workers to new, extra-Italian sites.  The Italian workforces have no redress; if they want to take up their jobs in Poland, for example, they can.  Only they can't really, can they?  For obvious reasons. Czy Pan mowi po Polsku?

Fiat has been the first example of a major industry exporting itself out of Italy, leaving only a fig-leaf structure behind but now the Italian steel industry seems to be taking its chance to shut down here.  Following the sequestration of its assets throughout Italy over a dispute in a southern Italian steel plant (whoever thought making basic steel is a clean and non-polluting undertaking?) about environmental conditions around the plant, the company has closed its sophisticated northern Italian production and research and logistics companies and sacked the workforce.  1500 highly-skilled workers in northern Italy are now out of work and (after a frantic meeting of Enrico Letta's government) on welfare benefits wholly funded by the tax-payer (no contribution from their erstwhile employer; after all, their industry has had its assets sequestered). 

No government truly running an advanced capitalist European country would find itself scrambling to contain the actions of a magistrate in a mean little town in a depressed area acting off their own bat to affect industrial policy and sophisticated output for export in the productive sectors of the national economy.  

It wouldn't really matter for most of us what Italy does, except, these  repellent incompetents are sliming round European capitals being ever so 'umble,  pushing their agenda for their 'presidency' of the European Union after the New Year.  

Their agenda consists of mutualising their debt, allocating European tax-payers' resources to their elitist local expenditures, demanding we take their banks and themselves at their own estimate, maintaining  themselves in national power at any cost,  and insinuating themselves into European power whenever and wherever they can.   If Italy is taken seriously in its claims to being a worthy counterparty to anyone or anything we will have only ourselves to blame for losses.

Monday, 15 July 2013

Rather Here Than There

The government so ardently desired and forcibly installed by Napolitano is now beyond description revolting.  The Deputy Speaker of the Senate has called the Minister for equality of opportunity an orangutan.  Leading members of his party have called for apologies not to the minister but to orangutans.  Napolitano, in an attempt to discard responsibility for the imposition of this coalition protested at the unheard of and degrading insults and was told to be quiet and mind his own business as this is the administration he engineered and sustains.

Napolitano has tried to assert that F35s and their worth and purchase is a decision for him and his puppet Executive, and to push aside Parliament's central decisional importance on expenditure;  he has been sharply put in place by constitutional analysts and even his own 'Commission' of constitutional experts but continues to insist that he and his army can do as they choose with their yet-another-special 'Commission', meeting in the presidential palace.

This corruption of politicians posing as an elected government has rendered the wife and daughter of a refugee to Kazahkstan  after informal meetings in Sardinia between the Kazahkstan dictator and Berlusconi.  Insult was then added to injury by the Italian state declaring the rendition shouldn't have taken place and the wife and daughter are welcome to return to Italy.  They have neither passports nor means or permission to go, and who would willingly return, considering the manner of their leaving? 

At what level of political and moral degradation  any member of the Letta government will resign is a source of speculation.  Economic failure, mass unemployment, social repression, law-breaking, state officials' and ministers' racial abuse (it's not just the Minister for Equalities, the illegally rendered wife was attacked by Ministry of the Interior paramilitaries screaming 'Russian whore' as they dragged her out of her house); and the suspension of Parliament for two days in protest at Berlusconi's final appeal being brought forward to deny the statute of limitations cancelling his conviction and condemnation - a suspension supported and voted for by the Democratic party and minor members of Napolitano's coalition administration - has not been enough.

In an appalling way it's technically interesting to watch how a fascist regime is put in place.  From London, that is.  Even the weather is better here than there.

Friday, 5 July 2013

La Miseria

The grocer in the village has stopped selling bread unless you have an order.  He explained the bakers have stopped taking back unsold bread and reduced the kinds of bread and other bakery products on offer.  It's a classic.  You can now order un pane once more, like all those years ago, and get what you're given.  It'll be un chilo di ciccia next and a lump of unidentified meat will be wrapped and handed.

The Italian statistical office has just issued its latest household consumption data [in English, should you care to look at the miserable collapse into ever-lower living standards and widespread poverty in all its detail, ed.]  Italian household consumption has fallen by the most since records began. 

Wednesday, 3 July 2013

Bailing In

Italy's economic distress is matched by its political and institutional debacle.  Starting from the top Italy has a head of state arguably unconstitutional in that second terms of office while not specifically forbidden are excluded by every provision noted within the constitution: by the fixed  length of term of office, 7 years, which implies no repeat -14 years is far too long for a non-hereditary system; by the characteristics sought of candidates,  extensive senior civic and  political experience which of itself implies  relatively advanced age in any candidate; by there existing no precedent for any re-election.

Next Italy has a prime minister wholly unsupported by the electorate's votes.  The election was held with entirely other candidates for office - none of whom was asked to form a government by a then out-going president, who positively precipitated governmental crisis by refusing to invite any Party leader to face Parliament, and then acted extra-constitutionally in appointing a committee to delineate the characteristics of both premier and policies regardless of expressed electoral choices.

The Parliament itself has been elected under  rules that have been rejected as unlawful by the supreme court but its decision, though available on line, has not been officially transmitted to the constitutional court - some half a kilometre away - because various official  practices required for its transmission have not yet been carried out in the last 8 weeks. 

The iffy Parliament is now altering the articles of the Italian constitution that set out the regulation of changes to the Constitution.  The finalisation of the removal of safeguards to the integrity of the Constitution will be during August, while no-one is around and looking. 

The reform of the Constitution will include altering the role and powers of the head of state (retrospective cover there, then) but excludes specifically any alteration to the sections of the  Constitution dealing with the judiciary and its independence -  while the newly and increasingly empowered head of state will remain as head of the judiciary.

The imposed prime minister is ruling ad hoc and  by decree, such decrees to be voted eventually by the Parliament, without normal legislative initiation procedures from parliament, and without any publicly discussed programme, let alone voted-upon manifesto. 

The Democratic party, of whom the Prime Minster is a member, delays electing a leader (having installed a temporary leader who is not the prime minister, in the interim, by appointment not election) and flouts every aspect of its own rule book (for, like the Labour party, when in office the party Leader is prime minister) to prevent any disturbance of the imposed prime minister's tenure.  A Party congress to choose a leader by election is repeatedly deferred and next year (sometime) is now being mooted.   

The minority Coalition partner in government has just seen its leader convicted repeatedly, at various levels for various crimes, and the People of Liberty party is to re-form with most of it in a newly founded Forza Italia party whose self-selected Leader will once more be Berlusconi (what happens to the remnants is not clear).

The third largest grouping within the ruling Coalition, Monti's Civic Choice party, is at last (and at least) demanding a  setting out and agreement of Coalition policies, on the German grand coalition model -  which demand has been refused, dismissed, by the Head of State (not even bothering to have the fig-leaf prime minister make the statement) as not serious, 'not a threat'.  Threat that is to the  novel administration being inflicted on the country.

Meanwhile unemployment is at its highest since 1977 and to say just that there's no money left would be positively reassuring given the state the country's economy is in.   Italy is far too big to bail out using the procedures applied to Greece, Cyprus and Ireland - even Spain, by Troika or the EU currency union alone.  The Cyprus template for financial response to currency union weakness  may not be the only template being trialled by determined europhiliacs. 

Italy is a template, a trying out of a total bail-in: not just in failing banks and financial areas but of the entire country's democratic institutions and procedures, including financial.  Every means of response short of unacceptable gestures in a civil society is being blocked-off and the country delivered hog-tied for whatever-it-takes financial and economic, institutional and political measures that will preserve the Project. 

Tuesday, 2 July 2013

It's Not Just Berlusca Who Can Embarrass For Italy

Silvio may have said out loud his assessment of the German Chancellor's bottom but there are public figures in Italy who display worse forms of vulgarity.  Consider these profound economic assessments delivered oh so sententiously in that washing-the-words-round-the-palate, plummy tones of the President of the Republic; he is addressing Confindustria (whose members enjoy  a certain entrepreneurial capacity).

Napolitano feels the need  for removal of "normative and administrative inadequacies which  prevent Italy from acquiring such significant potential resources [inward foreign investment].... "Today",  we are told by the Head of State, no less, "the flow of foreign investment is crucial to give an innovative stimulus to  production and employment recovery: not just to  provide fresh capital, but contributions from people, and ideas, of production and organisational models, of new technologies and systems."*

Who would ever have thought this?  Such innovative freshness of economic thought  from our 88 year old.  Take us away, Giorgio!

At least Berlusca knows what he's talking about.


* [only fair to put in the rotund phrases, the jejeune advice, as offered in the original, ed.]
".....rimuovere le inadeguatezze normative ed amministrative che impediscono di acquisire all'Italia così significative potenziali risorse». ..."Oggi l'afflusso di investimenti dall'estero in Italia é cruciale per dare uno stimolo innovativo alla ripresa produttiva e all'occupazione: non solo per l'apporto di capitali freschi, ma il contributo di persone e di idee, di modelli produttivi e organizzativi, di nuove tecnologie e sistemi".