Archive for November, 2011

Quality of debate


On the continuing drama that is the reform of the National Health Service in the UK. Max Pemberton highlights the importance of the House of Lords. He notes that the upper chamber is “a stuffy, esoteric and anachronistic institution that rarely registers in the collective consciousness in any substantial way”. He says that after the House of Commons voted to pass the legislation, “attention rapidly shifted to the Lords in the hope that the legislation would be stopped.”

He mentions how the debate was “earnest, sincere and thoughtful way the peers spoke, even those with whom I disagreed. Unlike in the Commons, there is an air of genteel reverence and politeness to the Lords’ debate. No braying and shouting here”. Pemberton again notes his opinions about the Bill saying, rightly that it “is a bad piece of legislation that undermines the very essence of a nationalised health-care system. It only succeeds in opening it to private companies that will place profits before patients”.

He mentions how “The crossbencher Lord Owen tabled a motion to set up a special committee, which would spend the next few months studying the constitutional impact of the reforms. This was rejected by 330 votes to 262. Labour’s Lord Rea had wanted the second reading to be refused altogether, on the basis that the Government had no mandate for the reforms.This was defeated by 354 votes to 220.”

Having watched the debate in the Lords he says that despite the vote, ” I was left with a new-found respect for this chamber. It would be easy to dismiss the Lords as out of touch and arcane. In fact, it is full of people with remarkable experiences who can bring real depth and perspicacity to debates in a way that career politicians in the House of Commons cannot”, he continues saying “it was the likes of Lord Walton of Detchant who stole the show. Aged 89, he was a doctor before the NHS even existed and spoke passionately, without notes, about the horrors he had witnessed before the NHS was created. I listened to his speech intently and was immeasurably grateful that we have in this country an institution that gave him a voice.”.

He concludes that “The Bill is now at the committee stage, where peers examine every line of legislation and debate it. Once again, the eyes of the nation will be fixed on this House to do their best to minimise the most noxious elements of this legislation”. For the common good, society should hope he is right.


Where’s the trust?


Whereas in autumn 2010 opinion in Germany was relatively evenly divided (41% ‘distrust’ versus 39% ’trust’), distrust [of the Commission] now clearly dominates (42% against 33%).”



At a time when German bond yields are rising, albeit slowly, and questions are being asked as to the sustainability of the “German strategy” for dealing with the euro crisis reports note that Germany or more formally the European Central Bank wants to invade the sovereignty of the nation states of the European continent.

It was reported that “Angela Merkel has said the EU should be given powers to strike out national budgets that do not meet tougher euro zone debt rules”. This is quite ironic when Germany refuses to countenance  the fact that making the ECB the lender of last resort and thus propping up the euro and averting economic Armageddon.

The news report goes on to say that “French and German leaders said yesterday they would soon present joint proposals for treaty change, prompting European commissioner for economic and financial affairs Olli Rehn to question if this was “really necessary” as existing oversight rules had yet to be exhausted”. Of course, this is laughable. France wants, and needs, and powerful ECB spending money to buy up its, and other nations, bonds, but Germany refuses to contemplate this. Whatever “treaty” is agreed will almost certainly be a fudge that will not sufficiently solve the problem.

Merkel said that “‘Whoever doesn’t live to the agreed rules will have to reckon with an automatic right of intervention which would mean the national budget is invalid'”. It is unclear however whether the national parliament would have to have to rewrite the budget or would it be the job of the Commission or the ECB. The article notes that “Chancellor Merkel brushed off demands for the ECB to go beyond its current mandate and become a lender of last resort for ailing euro zone members. ‘I don’t think that will work, at least not for any length of time,’ she said, saying markets would soon realise that ‘someone has to recapitalise the bonds on the ECB’s books'”.

Sarkozy was reported to have said that “that treaty change was necessary to prevent euro zone countries from pursuing divergent economic policies”. However Europe cannot pursue one single economic policy as it is too diverse. Citizens may accept the nation states of the continent being crushed underfoot in the short term, but they only tolerate this for as long as they have to.

Highly unusual


After the report of the into the diocese of Cloyne, the Irish Prime Minister’s speech and the closure of the Irish embassy to the Holy See, Rome has finally gotten around to appointing its new nuncio. Pope Benedict named Msgr Charles Brown to succeed Archbishop Giuseppe Leanza.

All seemed to note that Brown never attended the Pontifical Ecclesiastical Academy and is thus has no diplomatic training. However, Rocco notes that is is exactly why he was chosen “the longtime practice of dispatching Italian diplomats at the end of their careers — all of them said to have been “dominated” and sidelined by a strong, insular native hierarchy — the appointment to Dublin of a native English-speaker with an instinctive grasp of the Pope’s mind and no diplomatic experience whatsoever (let alone on his first posting as a mission chief) would make for a significant recasting of the Nuncio’s role as a force to be reckoned with”.

Brown said to be “armed with a blank check for reshaping the troubled, roiled Irish church to B16’s specifications, the ‘urbane,’ widely well-regarded Gothamite is expected to take up his duties as papal legate to the Republic — and, in keeping with long-standing custom, dean of its diplomatic corps — in January”.

Brown will have to decide how many dioceses to fill, with vacancies currently in the dioceses of Cloyne, Derry, Kildare and Leighlin and Limerick. Not to mention the bishops serving past the retirement age; Bishop Colm O’Reilly, Bishop Christopher Jones, and Bishop William Murphy.

Brown needs to decide which dioceses need to be dissolved, or not, in light of the reports. In addition to these duties “reports by the National Board for Safeguarding Children and conducted in Raphoe, Derry, Dromore, Kilmore, Ardagh Clonmacnoise and Tuam archdiocese, were completed months ago.” Brown will have to have all his media skills ready to prepare for what is going to be an embarrassing disgrace to the Church.

Apparently, “The reports are to be published individually and locally by each of the six dioceses, on Tuesday or Wednesday of next week (December 6th and 7th).” The fact that Pope Benedict was so willing to go outside the normal (PEA) route, is encouraging for both for Ireland and the Church.

Business as usual


As has been written here before, the foreign policy of President Obama is not just one of continuity with that of President Bush, but is, as a result of this, extremely successful.

Articulating this point of the success of Obama, Drezner notes that “John McCain said, ‘ I think the administration deserves great credit.’  Lindsey Graham went further, excoriating fellow Republicans for sheer bloody-mindedness in opposing Obama’s Libya policy”. Uncontroversially Drezner mentions that “Herman Cain has managed to vault to co-frontrunner status despite truly astounding levels of ignorance of foreign policy. There’s a reason for that — GOP voters don’t care about foreign policy and the president is increasingly unpopular despite his foreign policy prowess”. He adds that Obama’s “foreign policy approach hasn’t been perfect. He’s botched the tactics of the Israel/Palestine peace process, hasn’t earned all that much from his ‘reset’ with Russia, is pretty damn unpopular in the Middle East, and was slow to realize that his own personal popularity abroad wouldn’t translate into concrete policy accomplishments”.

Predictably, Stephen Walt weighs in saying that Obama has not been a success, this despite the  death of bin Laden, gradual success in Afghanistan as well as the death of Anwar al-Alaki. Of course Obama is only human so not everything goes to plan but by and large it has been a great success. Despite this, Dr Walt’s first objection is that Obama has not done enough to solve the climate change issue. As a supposed realist, Walt should know that states do not submit to any world authority or government so solving this problem is harder than Walt gives Obama credit for.

Walt continues noting that on the subject of Iran that “Obama began with some flashy gestures, but U.S. policy quickly reverted back to the status quo of Bush’s second term: ramping up sanctions and demanding Iranian compliance with U.S. demands as a precondition for progress on any other issues”. On Afghanistan, Walt argues that “NATO has lost the stomach for the fight”, this is despite the fact that Walt has consistently demanded that the US and its allies leave the country. Walt discusses Libya saying that “didn’t the “Mission Accomplished” moment in 2003 in Iraq teach us about the dangers of declaring victory prematurely?”. Yet Libya has been, with a certain amount of luck, a great success. Of course there is still work to do in Libya but solid foundations have been laid.

The world should be thankful that America has not changed its foreign policy, it is to everyone’s benefit.

Logical conclusion


“In a telephone conversation Friday, French President Nicolas Sarkozy suggested to Italian President Giorgio Napolitano that he drum up support for Monti and proposed that he and German Chancellor Angela Merkel visit Rome as soon as a new government is formed”

Refusing to die


Feminism just won’t go away, even though there is no basis to it anymore. Like the “trickle down” theory it refuses to die. Even worse, it is being kept alive by spineless politicians who, in this modern society must relentlessly pander to every ridiculous interest group, in order to stay in power.

The latest example of this is when UK Prime Minister David Cameron has been accused of attacking women in his policies.  Apparently a “20-strong coalition of charities, academics, women’s groups and unions say that women are facing the ‘greatest risk to their financial security in living memory.’ It comes as the Prime Minister faces growing accusations that women are deserting him and the Tory party in their millions over the way he has handled the cuts”.

A pressure group “is urging Mr Cameron and George Osborne to consider their ‘life raft’ measures ahead of next year’s Budget to try and alleviate the pain to women of a number of Coalition policies. Among their recommendations they want childcare costs for low income families restored and a re-think on plans to cut child benefit”.

It may not have occurred to these people that most levels of society have to endure suffering in this time of global financial crisis. Admittedly, the poorest do tend to suffer most, however to say that the cuts are aimed at women is outrageous and should be ignored.

Cameron’s MPs have “set up an informal group to act as a ‘sounding board’ for the Prime Minister to help put a female slant on the Government’s policies”. Laughably the news article goes on to say that “Theresa May, the Home Secretary, who is in charge of equality policy, will today announce plans for 5,000 new women business ‘mentors’. Mrs May will give a speech in which she will make clear how ‘women can play a central role in the recovery and a much bigger part in the economy in the future’. She will announce plans to train relevant volunteers over the next three years to provide a variety of advice in a way best suited to women”.

Worse still Cameron seems to be doing something to fix the problem. When feminism dies society will be better off.

Too big


If Italy and Spain are too big to fail and bailout, what will the markets think of Germany? As a bond auction attracted far less interest that many thought with only €3.8 billion of bonds sold of the €6 billion on offer. Yields rose to 2.15%.

Yet another candidate


Two days ago the infamous Bernard Francis Cardinal Law was retired from his post as  archpriest of the Basilica di Santa Maria Maggiore. Cardinal Law who had turned 80 two weeks previously was replaced by Archbishop Santos Abril y Castelló,76, who serves concurrently as vice-camerlengo of the Holy Roman Church. Archbishop Abril y Castelló will be included in next years consistory.

Rocco notes that “Law’s departure from the oldest church in the world dedicated to the Mother of God has actually come several years earlier than other recent cardinal-archpriests, both at Mary Major and elsewhere”, not only that but Rocco notes that “the Vatican’s midday release announcing Law’s retirement didn’t include the cardinal’s name nor notice of his resignation”. It merely stated “Il Santo Padre Benedetto XVI ha nominato Arciprete della Basilica Papale di Santa Maria Maggiore in Roma S.E. Mons. Santos Abril y Castelló”.

Rocco speculates that the consistory is “predominantly expected to come this time next year”, a late June/early July date cannot at this time be ruled out however.



In a short sighted, nakedly political act, Ireland has closed its embassy to the Holy See. The reason given was that it would save money for the bankrupt nation. The embassies of  Iran and the representative office in Timor Leste are also to be closed.

The report mentions that Minster for Foreign Affairs Eamon “Gilmore noted that while the Embassy in the Holy See was one of the Republic’s oldest diplomatic missions, it yielded no economic return”. The report adds that  “‘The Government believes that Ireland’s interests with the Holy See can be sufficiently represented by a non-resident Ambassador,’ Mr Gilmore said. ‘The Government will be seeking the agreement of the Holy See to the appointment of a senior diplomat to this position.'” The government is set to propose “that the secretary general at the Department of Foreign Affairs act as Ambassador to the Vatican, servicing it from Dublin”. The news report notes that “It is understood that closing the three missions will garner savings of more than €1.17 million annually”.

Sean Cardinal Brady, archbishop of Armagh and primate of All Ireland said that the decision “seems to show little regard for the important role played by the Holy See in international relations and of the historic ties between the Irish people and the Holy See over many centuries”.

Former Ratzinger doctrinal student, Vincent Twomey, has said that the “decision to close the Embassy to the Holy See, reducing Ireland’s diplomatic representation to second-class status, should be a cause of concern not only for Catholics, but for all citizens”. He goes on to argue that “It is ironic that, soon after Russia’s long-term special resident envoy to the Holy See was raised to full ambassador, soon after Britain upgraded its newly established mission to the Holy See, and almost immediately following Australia’s decision to open a resident mission, Ireland should close its Embassy. What should be of concern to all of us, is the narrow-minded, parochial nature of our foreign policy that cannot see the bigger picture and recognise the importance of the Holy See as a major player in the world of statesmanship”.

Cuttingly Twomey asks “it was reported recently that the Government would not be extending an invitation to the Pope for the International Eucharistic Congress in Dublin next year. But it is not in their gift to issue or not to issue invitations to such events. If Pope Benedict XVI were to come, it would be at the invitation of the Irish bishops or on his own initiative. In this case, he would normally be received as a head of state. Are we to understand that our Taoiseach is unwilling to extend that courtesy to the Pope?”

Others have argued that “US government, vastly more powerful and better resourced than we are, can recognise the unique nature of the Holy See. We are prepared to sacrifice our relationship, with a churlish comment that it is of no economic value” and in addition to the fact that “the social teaching of the Catholic Church should be something that the Labour Party would be in broad agreement with, such as the Catholic belief that business should always be at the service of humanity, not the other way around”.

In a terse note commenting on the closure, the Press Office of the Holy See said that it “takes note” of the decision taken by the Irish Government. Indeed  Gilmore, defended what was fundamentally his decision, although the support of the Irish Prime Minister, cannot be ruled out. This is especially true of the upcoming Irish budget that is expected to crush much of Gilmore’s core political supporters. Gilmore, supposedly thinking ahead, decided to close the embassy and gain political support from his base.

On a broader note John Allen mentions a book which argues that “the Holy See’s international influence is in decline”, Allen goes on to note that “the number of nations with which the Vatican has diplomatic relations grew significantly, and today stands at 179. Of those, only 80 have ambassadors living in Rome. Most of the rest assign responsibility for the relationship to a diplomat in another country”.

After the transfer of Archbishop Giuseppe Leanza to Prague, there is currently no apostolic nuncio to Ireland.

“Divisions are sharpening”


Even the Franco-German axis is falling apart, “Paris took decisive steps to renew a campaign opposed by Berlin to deepen the role of the European Central Bank in the battle against the crisis“.

Closed for editing?


After Julian Assange lost his bid in a UK court to be extradited to Sweden to face rape charges, an article in the New York Times examines the future of Wikileaks itself. It notes that the ruling “puts his personal freedom in doubt”. However, the article does not clarify what this means. It borders on the conspiracy theory that both the UK and Swedish governments are in league with the United States to make Assange suffer, although this surely would be a justifiably emotion for what he has done. For this to be the case both governments would have to order judges to act a certain way in addition to a whole other number of highly implausible actions.

It goes on to say how Assange and his co-collaborators “changed the face of journalism and the entire informational ecosystem”. All Assange did was endanger lives of US soldiers and thus more broadly, world security. To say he “changed the face of journalism” is nonsense. It fails to be seen how hacking into highly classified information is ‘journalism’.

The article mentions how “Although stateless and seemingly beyond the reach of the law and its enemies, WikiLeaks was, from the beginning, subject to a number of internal frailties and external vulnerabilities. The fact that WikiLeaks came to be embodied in a single individual, especially one as mercurial as Mr. Assange, was chief among them”. Of course the fact Assange is now the public face of Wikileaks means that if he is charged, in whatever jurisdiction, wikileaks is in danger of collapse as well.

Recently “Assange announced that WikiLeaks was going to take a break from hell-raising and devote itself full time to fund-raising because the financial blockade had eliminated 95 percent of the site’s revenues. He said at a press conference that the organization was fighting for survival.” The paper quotes Assange to say that Wikileaks might not last into 2012.

The paper notes how “Advocates of information transparency point out that even if WikiLeaks founders, the idea it represents — a transnational mechanism to disseminate information beyond the reach of any government, corporation or organization — will live on”. To call what Wikileaks did “information transparency” is streching the truth beyond belief. It seems more and more people are unaware of the need for a certain level of secrecy in specific matters of international relations and national security.

It adds that “It is as basic as supply and demand: There has never been a shortage of willing recipients of classified or private information that has significant news value, but leakers with both the motivation and access are far more rare”. The article implies that Wikileaks may just be a coincidence of all of these factors at a particularly sensitive time for the United States. Significantly it mentions how Wikileaks  “reduced the friction in leaking secret documents, it did not reduce the peril to those who might choose to do so”.

Thankfully it adds a sense of realism when it says that “the Obama administration has a very hard-line approach when it comes to state secrets, one that has not only affirmed the Bush administration’s approach, but has done so with renewed focus. Just 17 months into his administration, President Obama had already prosecuted more alleged leakers than any of his predecessors”. The article also mentions how Assange is his own worst enemy with a “high profile, along with what may have been some poor personal choices, have brought him back to earth with a thud.”

It ends saying that “the notion that state secrets across the globe had been cracked open like a piñata once and for all, and that secrets will be regularly plopping into public view, seems remote”. Assange’s naive, dangerous and individualistic approach to international affairs looks to be at an end. For this we should all be very grateful.

Overtly political


Supreme Court will rule on Obama health care law in summer 2012. Bad for justice, bad for health care, bad for democracy.

America V


In the last post on the current  American issue of Foreign Policy magazine, in an collection of articles covering a number of topics on what is wrong with America.

Among the more interesting is an article on the Imperial Hubris of the United States. The author writes that too much power leads to arrogance which in turn leads to “the childish illusion of omnipotence” and from there “the illusion of being exceptional, the idea that the ‘Greatest Nation in the History of the World’ can do anything, is doubtless fed by the manner of the country’s inception”. The United States, can at times be arrogant, however this can be partly attributed to the lack of understanding of America that is so prevalent. The notion of American exceptionalism has been dealt with here before, many times.

The writer goes on to say that “the American republic likes to claim that it represents not only the hopes of humankind, but universal values. The American way is the global way, or it jolly well should be”. Whatever about the United States being the the only hope for man or indeed universal values, it is understandable that a combination of free(ish) markets and some level of democracy lead to a higher quality of life. Of course, to say that only the United States encourages these is beyond comprehension.

He adds that  “it is not sufficient for the United States to be an example to the world. It is incumbent on the republic to export freedom and democracy, by force if necessary.” However what he fails to understand is that there is as much realism as idealism in how American interacts with the world. As evidence for the view that after 1989 America tried to reshape the world he says that “Bush the Elder was still too cautious to fully embrace Palmerston’s liberal interventionism. His son was not. It was 9/11 that released American hubris in full force”. Didn’t Bush 41 launch something called Operation Provide Comfort?

Outrageously, and wholly without substance he says that the “gradual militarization of American society — the ritual genuflections to ‘our men and women in uniform,’ the bloated military budgets, the fawning attitude to generals — has resulted in something more often associated with tin-pot dictatorships in the developing world”. Bloated military budgets? Is 5% of GDP bloated? He fails to give any evidence foe this “fawning attitude” and this should thus be ignored. He also wildly underestimates the level of nationalism in the country. He does correctly point to how “Europeans and the Japanese have become like spoiled adolescents, almost totally dependent for their security on the big American father. Too indolent, or scared, to take more responsibility for their own protection, they express the humiliation of their dependency in fits of anti-American pique”.

Lastly, in the same section is an article on the presidency. The author says that a one term presidency of six years would be far better. There is an argument for this, as he says “no sooner deliver a new leader into office than he is required immediately to begin a new campaign for reelection”. This of course has only been heightened by a 24 hour media and thus “timidity and trimming invariably become the order of the day for even the most visionary leaders”. Of course this leads to “policy fogs up fast when one is trying to keep potential funders and voters happy. So U.S. presidents spend their days waking to the prospect of bland compromise and turn in having abjectly sold out”.

However he is forgetting one, important, thing. The executive is too weak.

Sealing the deal?


Today Pope Benedict met Bishop Gerhard Ludwig Muller. While it is unclear exactly what was discussed, it is almost certain that Benedict offered Bishop Muller the job of prefect of the Congregation for the Doctrine of the Faith to replace William Cardinal Levada. If Muller takes the job, it is thought that it will be published sometime in the new year, placing Muller first in line for a red hat in 2012.



George Soros seems to have found a way to solve the euro crisis, without burying the continent in debt. The plan would involve using the European Financial Stability Facility, the bailout fund for the euro zone. Essentially, in order for this crisis to pass “Europe needs a bazooka big enough to convince the markets that making a wager against Frankfurt will be futile — and expensive”.

The EFSF has been branded as too weak, too small to deal with the current figures involved, “Mr. Soros disagrees: ‘It actually has the bazooka in its hand, provided it uses it in the right way.'”

His idea is that “the bailout fund is big enough, Mr. Soros thinks, to save Europe in a different way. ‘It needs to be used to guarantee the banking system,’ he said . ‘That would create a lender of last resort, which is currently lacking.’ The bailout fund, he continued, could take the solvency risk, which is beyond the legal right of the European Central Bank. ‘And for that,’ he said, ‘there is plenty of money.’ Thus shored up, the banks would be able to buy the high-yielding government debt of the European countries that are currently struggling to find lenders. Banks would be encouraged to hold their liquidity in Treasury bills, Mr. Soros said, which they could sell to the European Central Bank at any moment. ‘So it is the equivalent of cash, and it would yield more than cash, therefore they would hold it,’ Mr. Soros said. ‘That would allow countries like Italy and Spain during this crisis period to borrow at negligible cost.'”

Just in case that is not implemented or doesn’t work, France, of all countries, is allegedly preparing for countries to leave the euro.

The plan apparently consists of creating “a breakaway organisation of eurozone countries with its own treaty, parliament and headquarters”.  There was the usual British whining about how the plan “would lead to a significant deterioration in Britain’s influence in Europe”. This from a nation that is convinced of its own superiority and how it doesn’t need the EU and should just become like Switzerland, despite the fact that it geographically part of the European continent.

However, the article says little of the future role of France itself, as markets begin to attack that country and its much treasured AAA credit rating. As that were not enough, questions are beginning to be asked of Spain.

Just another day for the EU.

Experience over youth, for now


Now the Saudi Arabia has a new Crown Prince, as was widely expected, who after King Abduallah is “the most senior of the surviving sons of the country’s founder”. The article emphasises Nayef’s age, 78, and notes that “one sign of Prince Nayef’s growing power came in March when the king announced that 60,000 new jobs would be created in the interior ministry”.

She argues that “Nayef’s supporters in Western capitals suggest that as king he would adopt a less conservative approach than is required by an interior minister, but this is likely wishful thinking.” Interestingly she does note that Saudi Arabia “could become increasingly out of sync with a changing Arab region. While seniority remains extremely important in Saudi politics, other Arab countries are being dramatically altered by new youth-led social movements”. This argument taken to its logical conclusion is that the Saudi people will rise up and overthrow the House of Saud. Yet there has not been the appetite for this when conditions were far more unstable than they are now.

She asks who will take over from Sultan as defence minister, a question that has been answered by the appointment of Prince Salman, who she describes as “as more liberal, is said to be popular among younger princes”. Lastly she mentions how “Nayef’s sons, Prince Saud bin Nayef, formerly ambassador to Spain, joined the interior ministry in July as an advisor to his father.”

Indeed some have implied that Nayef might be the last of the al-Saud to rule the kingdom. The writer notes that the kingdom is fundamentally pragmatic and as such “prefers to maintain the regional status quo and would favour forestalling a trend towards democratization in the region that might spread to their borders. Saudi Arabia was strongly opposed to the change in ruler in Tunisia and in Egypt, even offering refuge to Zine El Abidine Ben Ali. This stance does alter, however, if Saudi Arabia perceives the regime change as being in its favour, such as in Libya and Syria where the negatives of unbalancing regional power dynamics were outweighed by the positives of the removal of an unfriendly government”.

She adds that the Saudi’s are using their wealth to shore up support for other conservative regional monarchies, with “King Abdullah pledged 1.4 billion dollars in aid to Jordan in order to offer the Jordanian King Abdullah a bargaining chip against any domestic unrest”, not only that but Oman and Bahrain, “have been pledged a combined aid package of twenty billion dollars over the next ten years. Officially this money is meant to be pledged in equal proportions from the other four GCC states and rolled out over the coming years, but experts such as Steffen Hertog, lecturer in Comparative Politics in the Department of Government at the London School of Economics, claim Saudi Arabia will contribute the lion’s share”. Underlining Saudi regional power, Bahrain’s internal problems with “troops were deployed through the GCC’s Peninsula Shield Force, the region’s collective defence agency, but the impetus behind the action appears to have come primarily from Saudi Arabia”.

Worse still, Saudi Arabia’s long term stability is questioned when she mentions that “The breakeven price of a barrel of oil for Saudi Arabia is now eighty dollars, whereas only a decade ago it was twenty. And Saudi Arabia’s domestic oil consumption is ever increasing. If Iraqi and Libyan oil leads to lower oil prices, Saudi Arabia will face the challenge of maintaining feverishly high public spending in order to continue to appease a growing youth with high expectations, high aspirations and no incentives to pursue either education or a job in the private sector. They are merely kicking the problem further down the road”. Perhaps the kingdom cannot afford regional power anymore?

After all that has, and is, going on, there is still one major question to be resolved. Who will be Saudi second deputy prime minister and thus crown prince in waiting. All of these issues as well as wider regional stability have to a large degree, contingent on what Saudi Arabia does next.

America IV


As part of the analysis of this month’s Foreign Policy magazine, James Traub examines the GOP foreign policy. He goes on to say like the 2008 and 2010 elections, “The world beyond America’s borders just doesn’t figure in the 2012 campaign”. If this were not the case however, and it was a foreign policy election, Obama would romp back to the White House due almost exclusively due to the fact that “As president, Obama has disappointed many of his liberal supporters, but also blunted Republican lines of attack on his foreign policy by pursuing the war on terror much as George W. Bush did”.

Traub argues that the “The Tea Party is the faction of Less — less spending, less government, and, generally, less engagement abroad.”

None of the candidates save Paul can genuinely be called isolationist — and perhaps not even he. But Rep. Michele Bachmann shares the Tea Party’s suspicion of foreign interventions and foreign countries more generally; former Utah governor Jon Huntsman has called for “nation-building at home” rather than “nation-building in Afghanistan” or elsewhere; and Texas Gov. Rick Perry has warned vaguely of “military adventurism.”

Yet surely these quotes are simply a matter of politicians being politicians. In typical Romney style in 2008 he “sought to distinguish himself from the other Bush epigones by proposing the use of soft power as well as hard power in the Middle East by the United States and its allies: ‘We as great nations,’ he said in a debate in January 2008, ‘need to help them have the rule of law, have good schools that are not Wahhabi schools, strengthen their economies.'” The article notes that currently, Romney is keeping to the GOP line of “‘free trade, strong defense, skepticism about China, a robust view of the war on terror.'” The articles goes on to mention how “Romney has relatively little to say about Iraq or Afghanistan and does not share Pawlenty’s enthusiasm for spreading America’s values abroad.”, yet given the funds and political opportunity there is little doubt that Romney would adhere to exactly these policies.

Interestingly he says that “The core of his foreign-policy message is that America is threatened in ways that Obama cannot or will not recognize” which includes China and Russia, irrespective of the fact that Russia is increasingly irrelevant. It notes the Romney does specifically say that “Pentagon spending, excluding the costs of the wars in Iraq and Afghanistan, must be ‘at least 4 percent of GDP.’ This would increase annual defense spending to $600 billion or more, and overall military spending to about $720 billion — though how he would do this while balancing the budget is anyone’s guess.” This however is not a major issue when the relevant facts are taken into account.

Worryingly Romney seems to be following the trend that “the GOP rank and file has less taste for gung-ho internationalism than party elites do. A January poll of self-described conservatives, for example, found that two-thirds thought that the United States should either reduce troop levels in Afghanistan or leave right away”. Much of this is thankfully related to the current economic crisis and should dissipate when conditions, eventually improve.

The article says that old GOP realists of the HW Bush era have been sidelined in favour of “neocons” of the W Bush administration. This ignores the fact that Bush 43 had realist and multilateral talks with North Korea and Bush 41 invaded Panama, to say nothing of Operation Provide Comfort.

Whoever is elected things will, broadly, remain the same.

Extinction II


As has been mentioned here before, Christians are fleeing the Middle East. Their depature not only leaves the area less rich but more risks greater intolerance of those who stay.

Falling on deaf ears


As the disaster that is the current National Health Service destruction make their way through the House of Lords, there is evidence that the previous Labour government made yet another catostrophic error.

The same minister in the current UK government that supports more privatisation has ironically attacked the previous government for doing the same thing. The report notes that “Lansley says he has been contacted by 22 health service trusts which claim their ‘clinical and financial stability’ is being undermined by the costs of the contracts, which the Labour government used extensively to fund public sector projects”. It adds that 60 hospitals and roughly 12 million people are affected by the fianances of their local hospital. The news report notes that “There is already evidence that waiting lists for non–urgent operations have begun to rise as hospitals delay treatment to save money”.

The scheme that was begun under the previous government means that “a private contractor builds a hospital or school. It owns the building for up to 35 years, and during this period the public sector must pay interest and repay the cost of construction, as well as paying the contractor to maintain the building”. In effect the tax payers money is wasted through high interest rates and poor build quality, leaving the public worse off than before. The result is the government must step in and pick up the tab so as not to be in breach of contract. The result in the senario is that “the total cost of the deals is often far more than the value of the assets. As a result, Mr Lansley says, the 22 trusts ‘cannot afford’ to pay for their schemes, which in total are worth more than £5.4billion, because the required payments have risen sharply in the wake of the recession”.

An example is that “Taxpayers are having to pay more than £200billion for schools, hospitals and other projects whose capital value is little more than £50 billion”. Similarly, a hospital in “south east London, will ultimately cost the NHS £1.2billion, more than 10 times what it is worth. Another hospital was charged £52,000 for maintenance that cost £750. The annual cost of the schemes is almost £400 for each household. The public payments for PFI deals are typically linked to inflation and therefore the cost to taxpayers has increased by up to a third since the beginning of the credit crisis, according to the National Audit Office”.

The scheme was meant to provide a service that would save the state money at the same time. Instead the costs are far beyond what it would have cost for the state itself and as always the taxpayers are paying for the mistakes. The role of the market should be strictly limited. The result is services are delived slower but normally in budget and without the huge cost to the citizens.

The arguments for private health make no sense and in pratice deliver little. Yet the UK government is either ignoring the valid arguments against private health care or vested interests are corrupting them.



On this day, 11/11/11, it is worth remembering those who have fought, and who are fighting, for our security at this time.

America III


In the current  American issue of Foreign Policy magazine, Tom Friedman and Michael Mandelbaum take a more nuanced approach of American exceptionalism than Dr Walt did in the same issue. They argue in their articleAmerica Really Was That Great, that “the idea of American exceptionalism does have real intellectual grounding. As used by scholars, it refers to the ways the United States has differed historically from the older countries of Europe: the fact that it was found”. The writers add that “It refers to what makes America special: its wealth, its power, the economic opportunity it has provided for its citizens, and the expansive role it has played in the world, including the example of liberty and prosperity that it has set”.

Crucially they note that “Exceptionalism is not a distinction that is bestowed and then lasts forever, like an honorary degree from a university; nor is it an entitlement like Social Security or Medicare — something all Americans automatically get to enjoy at a certain age. It has to be earned continually”, they add that “To remain exceptional, America must respond effectively to its four great 21st-century challenges: the ones posed by globalization, the revolution in information technology, the country’s huge and growing deficits, and its pattern of energy consumption”.

America’s failure to do fix these problems are an even bigger problem for the rest of the world’s nations, as “since 1945, and especially since the end of the Cold War, the United States has provided to the world many of the services that governments generally furnish to the societies they govern. While maintaining the world’s major currency, the dollar, it has served as a market for the exports that have fueled remarkable economic growth in Asia and elsewhere. America’s Navy safeguards the sea lanes along which much of the world’s trade passes, and its military deployments in Europe and East Asia underwrite security in those regions. The U.S. military also guarantees the world’s access to the oil of the Persian Gulf, and American intelligence assets, diplomatic muscle, and occasionally military force resist the most dangerous trend in contemporary international politics: the proliferation of nuclear weapons”.

The add, justifiably that with the crisis in Europe, China and the wider security situation in Asia, “a dynamic American economy and a stabilizing, reassuring American global presence are as important now as they have ever been, if not more so”.  Presciently they argue that American power is something that “Those on the left often do not fully understand its constructive uses, concentrating instead on the occasional abuses that always attend the exercise of power. Those on the right often do not fully understand its sources — that American power is not simply a matter of will but of means, and those means need to be constantly renewed and refreshed”. The say that America with its flexibility and creativity ” ideally suited to flourish in the 21st century”

“American power and prosperity, and global stability and prosperity, are all riding on the country’s success in meeting its challenges. A world influenced by a United States powerful enough to provide political, economic, and moral leadership will not be a perfect world, but it will be a better world than any alternative we can envision. That means that the status of American exceptionalism is more than an academic controversy or a partisan political squabble in the United States. Everyone, everywhere, has an interest in America taking the steps necessary to remain an exceptional country”.

Warning signs


What has been thought for years, has been all but confirmed. Iran is making a nuclear weapon, “the International Atomic Energy Agency (IAEA) said that credible evidence existed that Iran had carried out activities solely related to the construction of a nuclear weapon.” The news report goes on to say that the IAEA report “acknowledged that some suspected secret nuclear work could have dual use purposes in conventional weapons, it said other activities about which it had evidence were ‘specific to nuclear weapons’. The news article adds that “The report also warned that Iran had acquired a more sophisticated version of the blueprint to make a nuclear weapon than documents seized from Libya in 2004″.

This leaves questions as to what should be done next. In an interesting article on the attempted assassination plot of the Saudi ambassador to the United States, Adel al-Jubeir, Daniel Byman says that the three reasons for disbelief encompass; “the Iranians would never conduct such an operation because it goes against their interests; the Iranians are too competent for such a cartoonish plot; and if Iran did do such a thing, it must have been a rogue operation by junior intelligence officers”. Byman says that one of the suspected Iranian agents charged with preparing the plot, Mansour Arbabsiar met “with Ali Gholam Shakuri, a senior member of Iran’s paramilitary Quds Force, a special unit of the country’s Revolutionary Guards that has carried out many terrorist attacks.  Shakuri in turn informed the head of the Quds Force, who reports directly to Iran’s Supreme Leader.” Byman adds that these details taken with the “intercepted phone calls between Arbabsiar and Shakuri, which is hard evidence to dismiss”, coupled with the $100,000 means that “Together this is pretty damning evidence”.

This flies directly in the face of good realism, which says that all states are power maximising, but fundamentally rational, actors. Byman continues speculating that “Tehran may have felt it still needed to act despite these risks. Iran has suffered serious recent setbacks in the Middle East. Its Syrian ally is under siege. Closer to home, Saudi troops led a crackdown in March in Bahrain”. In addition to this he says that “Saudi officials claim that Shakuri helped to plan Quds Force operations in Bahrain giving him a personal motive to lash out against the Saudis and the United States”. Although this latter cannot be assumed to be true, as Saudi-Iranian hostility is well known. He adds that Iran used a drug gang in Mexico so as to have the maximun level of deniability.  He concludes saying that “responding with a passive shrug or weak-kneed condemnations may look to Iran like a green light for a second try”.

It is of course not the simple as there are increasing tensions within the regime. An Economist article notes that President Mahmoud Ahmadinejad, and supreme leader, Ayatollah Ali Khamenei have come to figurative blows. The article notes the the supreme leader may abolish the presidency altogether as “a pointed reminder that the supreme leader has the final say”. The article worryingly points to the fact that “Ahmadinejad seems reluctant to take the hint. He responded with a defiant speech of his own, declaring that anyone who defied the will of the Iranian people would be ‘destroyed'”. In addition to this power struggle, there have been “Months of simmering mistrust had already boiled over in April when Mr Ahmadinejad sacked Heydar Moslehi, Iran’s intelligence minister, only to see him promptly reinstated by the supreme leader”. Any regime instability will make whatever decision is taken by the West, even more complex and dangerous.

In his article Miller warns Israel and the United States about the consequences of any violent actions. He says that “ Striking Iranian nuclear sites is like mowing the grass. Unless a strike succeeded in permanently crippling the Iranian capacity to produce and weaponize fissile material, the grass would only grow back again”. However, Israel and others are only concerned about the short term, for Iran to develop nuclear weapon(s) now means no turning back, even a tacit acceptance.

Miller does make the valid point that “Even in the unlikely event Iran became a democracy, its own regional image and ambitions might still impel it to develop a nuclear capacity. At a minimum, denying Iran nuclear weapons means fundamentally changing the mullahcracy in Tehran; a military strike by the Israelis might do just the opposite”. There is of course a middle way, the regime is reasonably unstable and deeply unpopular. Perhaps now is the time to covertly step up support for the Green Movement? This would also undo Miller’s otherwise valid assumption of “There’s no better way to mobilize a divided polity or bring out its nationalist and unified character than to demonize a foreign enemy”.  He says the consequences of an Israeli or American strike, “Even if the Iranians could only temporarily block shipping in the Strait of Hormuz (through which 40 percent of all oil sails), the price of oil would spike exponentially, further undermining and sabotaging world markets — and doing tremendous damage to the fragile economic recovery”. This excludes what Iran would try to do in Syria, Saudi Arabia, Iraq or Israel itself. His argument that the strike would legitimise Iran across the region however is flawed. Many countries have either, great antipathy, or are close allies. There seems to be few countries that are between these poles.

Finally, he concludes that “There’s no way that an Israeli strike comes off without major complications and a military response against U.S. interests”, except this is not quite true. If it were done correctly with enough force, it would be a short term fix to an increasingly dangerous problem, that is a threat both to regional and world stability. Whatever is done it needs to be decided with the utmost care. After that it is beyond our control.

Looking over the abyss


Italian ten year debt past 7% interest rate. Contagion to follow and after that, who knows. Unless America intervenes to save the world, again.

Both sides of the aisle


Mitt Romney, in trying to bolster his conservative credentials has taken the usual route of praising American power. The article in the Economist discusses the decline of the United States.

The article, “Romney says that he wants the 21st century to be American too. That seems a little greedy”. This comment seems very short sighted. No other nation except America can be assured of providing public goods, such as international order and the peace and stability that come with it, for so long to so many nations, of which the United States is just one. As has been mentioned here before, it is in the interest of the world that the United States prosper and thrive. It is highly questionable to assume that any other nation would act as benevolently as America has done, if it were in its place as the new world hegemon.

The article asks, “given the economic rise of China, India and Latin America, the spread of nuclear weapons, and the general bolshiness of assorted Russians, Arabs and Persians, to keep America on top for the whole of the 21st century?”. There are a number of highly flawed assumptions that riddle this question. China’s “rise“, if the analysts are correct, will be short lived, and end dramatically. Whatsmore it is more about managing decline than, managing its rise. The question of the rise of India and Latin America, read Brazil, is unclear. These nations are still broadly pro-American in that they want, more or less, the same things, international peace and free trade. They are not however challengers to the United States in any direct way, and will not be, if at all, for decades to come.

The article goes on to note how Romney has brought in a wide range of advisers “from every hue of the foreign-policy spectrum”. It argues, predictably that “Romney set out his vision for a new American century in a speech to military cadets in South Carolina. Unfortunately, the speech and the paper suggest that neither prolonged cogitation nor extravagant consultation have produced much that is new”. However, the article, and indeed the writer fails to realise that there was nothing new produced because there is a general consensus as to how America should act in the world, and secondly, because it has worked, both for the United States and the world.

The writer notes that “a message of broad continuity makes a nonsense of the Grand Old Party’s shrill disparagement of the incumbent president’s foreign policy”. Indeed this is perfectly true. The “shrill disparagement” is nothing more than electioneering and should be taken as such.

Finally, the article mentions how Romney says that “his chief answer to the question of how to ensure American domination of the century is to uphold its military power”. This is broadly true but can only be sustainable with a strong economy.

What hope?


Even the wealthy want to leave China. What hope has it then of being a regional, let alone, global power.

America II


As part of its current American issue, Dr Stephen Walt writes in Foreign Policy about American exceptionalism. Dr Walt notes that “Over the last two centuries, prominent Americans have described the United States as an ‘empire of liberty,’ a ‘shining city on a hill,’ the ‘last best hope of Earth,’ the ‘leader of the free world,’ and the ‘indispensable nation.'”

This topic has been discussed here  before however, yet seeing as this topic is fundamental to understanding the United States it is important that it be revisited. Walt says that exceptionalism implies that “that the United States is both destined and entitled to play a distinct and positive role on the world stage. The only thing wrong with this self-congratulatory portrait of America’s global role is that it is mostly a myth”. No one can prove whether America was or is “destined” to play a role, but the role it has played has been generally positive over the last seventy years or so.

He notes that “the conduct of U.S. foreign policy has been determined primarily by its relative power and by the inherently competitive nature of international politics. By focusing on their supposedly exceptional qualities, Americans blind themselves to the ways that they are a lot like everyone else”. Certainly America has dominated the international system due to its huge power advantage over the rest of the world, but to say that it is like the rest of the world is farcical. Instead of having Germany and Japan pay huge reparations after 1945 as the European powers did, America gave money away to rebuild the economies or these nations so they could prosper and compete with America economically. This has been  a repeated pattern throughout American history. Woodrow Wilson, for all his League of Nations idealism, invaded Mexico, so that he could “teach them to elect good men”. Walt adds that “This unchallenged faith in American exceptionalism makes it harder for Americans to understand why others are less enthusiastic about U.S. dominance”, conversely, it also makes others less understanding of the US, although Walt’s point that the US has an essentially unchallenged belief in its exceptionalism is certainly true.

He argues that “U.S. foreign policy would probably be more effective if Americans were less convinced of their own unique virtues and less eager to proclaim them”, were this the case however, then US foreign policy would not be American! The nations history and founding, whether one believes it or not is based on the belief that it is a light to the world, or “a city on a hill”, that others should follow.

Walt then adds that America, like “Most great powers have considered themselves superior to their rivals and have believed that they were advancing some greater good when they imposed their preferences on others”. What he says is certainly true it is seen through a European, and realist, rather than an American, lens and therefore makes sense to a realist. That is not to say that some systems are not inherently better than others.

Lastly, on Walt argues that exceptionalism, rests “on the belief that the United States is a uniquely virtuous nation, one that loves peace, nurtures liberty, respects human rights, and embraces the rule of law”. He argues fatuously ” the United States has been one of the most expansionist powers in modern history. It began as 13 small colonies clinging to the Eastern Seaboard, but eventually expanded across North America, seizing Texas, Arizona, New Mexico, and California from Mexico in 1846.” Would Dr Walt, like Jefferson, think that it was illegal to expand beyond the 13 colonies?

He “The United States talks a good game on human rights and international law, but it has refused to sign most human rights treaties, is not a party to the International Criminal Court, and has been all too willing to cozy up to dictators — remember our friend Hosni Mubarak?”. Walt accuses  the US of being too realist? This from a supposed realist!

All in all Walt’s overall criticism’s amount to little. As has been said before, exceptionalism is fundamental to understanding how America acts in the world today.

America I


In the current issue of Foreign Policy magazine, America gets special attention in a series of articles. In the lead article, America’s Pacific Century, secretary of State Hillary Clinton, notes that “In the next 10 years, we need to be smart and systematic about where we invest time and energy, so that we put ourselves in the best position to sustain our leadership, secure our interests, and advance our values”. She adds that “Asia-Pacific has become a key driver of global politics. Stretching from the Indian subcontinent to the western shores of the Americas, the region spans two oceans — the Pacific and the Indian — that are increasingly linked by shipping and strategy. It boasts almost half the world’s population. It includes many of the key engines of the global economy, as well as the largest emitters of greenhouse gases. It is home to several of our key allies and important emerging powers like China, India, and Indonesia”.

She argues that US commitment in Asia “will help build that architecture and pay dividends for continued American leadership well into this century, just as our post-World War II commitment to building a comprehensive and lasting transatlantic network of institutions and relationships has paid off many times over”. She mentions how some wish for America to focus on its domestic problems but adds thankfully that “These impulses are understandable, but they are misguided. Those who say that we can no longer afford to engage with the world have it exactly backward — we cannot afford not to. From opening new markets for American businesses to curbing nuclear proliferation to keeping the sea lanes free for commerce and navigation, our work abroad holds the key to our prosperity and security at home. For more than six decades, the United States has resisted the gravitational pull of these ‘come home’ debates and the implicit zero-sum logic of these arguments. We must do so again”. Crucially, she adds that “Open markets in Asia provide the United States with unprecedented opportunities for investment, trade, and access to cutting-edge technology”. Showing the importance that the administration gives to Asia, she proclaims that “I broke with tradition and embarked on my first official overseas trip to Asia”. She explains her regional focus on Asia, saying “it calls for a sustained commitment to what I have called “forward-deployed” diplomacy. That means continuing to dispatch the full range of our diplomatic assets — including our highest-ranking officials, our development experts, our interagency teams, and our permanent assets — to every country and corner of the Asia-Pacific region”.  The details of this encompass “six key lines of action: strengthening bilateral security alliances; deepening our working relationships with emerging powers, including with China; engaging with regional multilateral institutions; expanding trade and investment; forging a broad-based military presence; and advancing democracy and human rights”. In essence, doing what America has always done, but in Asia. She brings greater detail to this by saying that the administration’s principles are keep political consensus at home,  have nimble alliances and “guarantee that the defense capabilities and communications infrastructure of our alliances are operationally and materially capable of deterring provocation from the full spectrum of state and nonstate actors”.

On the subject of China she mentions how “China represents one of the most challenging and consequential bilateral relationships the United States has ever had to manage. This calls for careful, steady, dynamic stewardship, an approach to China on our part that is grounded in reality, focused on results, and true to our principles and interests”. She argues that the relationship between the two countries is symbiotic, yet at the same time says “We are also working to increase transparency and reduce the risk of miscalculation or miscues between our militaries. The United States and the international community have watched China’s efforts to modernize and expand its military, and we have sought clarity as to its intentions. Both sides would benefit from sustained and substantive military-to-military engagement that increases transparency”. She notes the importance of the Strategic Security Dialogue and its role in diffusing the tension. The importance of regional multilateral institutions is emphasised, especially the Association of Southeast Asian Nations (ASEAN) and the Asia-Pacific Economic Cooperation (APEC) forum, in addition to the “a number of ‘minilateral’ meetings, small groupings of interested states to tackle specific challenges, such as the Lower Mekong Initiative” and the “Pacific Islands Forum, where we are working to support its members as they confront challenges from climate change to overfishing to freedom of navigation”. Needlessly she explains “the economic work of APEC is in keeping with our broader commitment to elevate economic statecraft as a pillar of American foreign policy”.

Concluding she says “This kind of pivot is not easy, but we have paved the way for it over the past two-and-a-half years, and we are committed to seeing it through as among the most important diplomatic efforts of our time”. It is important that the US refocus on Asia, but not lose sight of other threats, however negligible.

Fall of the Berlin Wall cont’d


Greek Prime Minister George Papandreou had promised his citizens a referendum on the new aid package that has been cobbled together by the EU. The package “agreed on a 100bn-euro loan (£86bn; $140bn) to Athens and a 50% debt write-off, in a effort to tackle the euro crisis. But there have been large-scale protests in Greece against austerity measures demanded by the EU”. The referendum was expected to have taken place early next year, or possibly late this year. It was thought that if the referendum had been put to a vote it would have been rejected. The reaction of the markets to the announcement was predictable enough.

As if thing’s were not complicated already, the Greek government announced that the heads of the three branches of the armed forces had been strangely removed. The plan for a referendum has now been cancelled, with Papandreou’s hold on power  at best, tentative. It is highly unlikely that he will survive and may now be forced to resign, with Lucas Papademos expected to be the new prime minister. Greece had been given an ultimatum by France and Germany to either accept the loan that has agreed last week or else leave the euro altogether. Not only is this puerile and short-sighted it again shows that the Franco-Germanic axis will not tolerate any opposition to its view of the world.

Watching the euro crisis unfold it is hard not to draw comparisons between the EU and the last days Soviet Union. As dissidents who managed to escape to Finland or beyond, soon realised, the myth that the Soviet people were being sold was shattered as soon as they came into contact with the real world. The ideology of communism that was seen as true, only when reality was ignored. When reality intruded onto the myth reality was ignored. When reality could not be blocked out any more it became unsustainable. This is especially true of at the end when dramatic events like the Berlin Wall fell. People flooded across the border into what was West Germany and realised that what they had been told was a myth. The only reason that the Soviet Union lasted for so long was due to the lack of direct elections or votes.

Similarly, the EU has only managed to last this long, and indeed expand, as a result of them sidestepping or on several occasions, blatantly ignoring numerous votes against the project. Regardless of this they carried on. Now the euro crisis is their Berlin Wall and the myth of the “European project” has been shattered, and as a result of their arrogant attempts to protect it, perhaps forever.

However, the system is now so complicated, entrenched and unstable that any attempt to give people a vote on it at this stage would have consequences so calamitous that it would destroy the world economy and bring an end to any hope of economic growth or recovery, for years to come. The only way the current crisis can be resolved is for deeply undemocratic, rapid and radical integration to take place, with the creation of a powerful EU finance ministry. Only then is there hope that the current crisis will get no worse.

Of course by doing this, the EU will sign its own death warrant, as economic conditions eventually improve the way the euro thugs have acted will linger on, with many leaving the bloc once the crisis eventually abates.

The rich get richer


The poor get poorer, and the common good suffers.

Manufacturing giant?


In a piece that goes against the prevailing wisdom of the age of America’s inevitable decline.

The writer mentions “the ‘shale gas revolution’ that has turned America into the world’s number one producer of natural gas, ahead of Russia. Less known is that the technology of hydraulic fracturing – breaking rocks with jets of water – will also bring a quantum leap in shale oil supply, mostly from the Bakken fields in North Dakota, Eagle Ford in Texas, and other reserves across the Mid-West”. He adds that “Total US shale output is ‘set to expand dramatically’ as fresh sources come on stream, possibly reaching 5.5m b/d by mid-decade. This is a tenfold rise since 2009.”

While fracturing is a way of exploiting the vast fields of natural gas, the technique is still reasonably new and its environmental impacts are uncertain. He mentions that “the China-US seesaw is about to swing the other way. Offshoring is out, ‘re-inshoring’ is the new fashion. ‘Made in America, Again’ – a report this month by Boston Consulting Group – said Chinese wage inflation running at 16pc a year for a decade has closed much of the cost gap. China is no longer the ‘default location’ for cheap plants supplying the US. A ‘tipping point’ is near in computers, electrical equipment, machinery, autos and motor parts, plastics and rubber, fabricated metals, and even furniture.”

If this is true it would help the millions of unskilled Americans return to work, but to say that such moves are assured is naive. There are dozens of other low cost nations that can easily supply unskilled work, in both Asia and Africa. The writer adds that
“The gap in ‘productivity-adjusted wages’ will narrow from 22pc of US levels in 2005 to 43pc (61pc for the US South) by 2015. Add in shipping costs, reliability woes, technology piracy, and the advantage shifts back to the US”, There are of course a whole range of factors that decide where a company locates a manufacuring plant. Some of which the writer mentions, but others such as infrastructure costs and other do not necessarily mean that jobs will flood back to the United States.

He does however mention that “Farouk Systems is bringing back assembly of hair dryers to Texas after counterfeiting problems; ET Water Systems has switched its irrigation products to California; Master Lock is returning to Milwaukee, and NCR is bringing back its ATM output to Georgia. NatLabs is coming home to Florida. Boston Consulting expects up to 800,000 manufacturing jobs to return to the US by mid-decade, with a multiplier effect creating 3.2m in total. This would take some sting out of the Long Slump.”

America still faces enormous challenges that must be overcome but if they are, “The 21st Century may be American after all, just like the last”.