Quotulatiousness

February 10, 2012

Before Watergate the FBI had to put together files using wiretaps, informants, and detective work

Filed under: Government, History, Liberty, USA — Tags: , , , , , — Nicholas @ 11:03

Nowadays, of course, they wouldn’t need to do any of that: most of what they collected then could be gathered by looking you up on Facebook:

Bud Abbott and Lou Costello are perhaps best known for their comedy sketch Who’s on First?

But in the 1950s, the duo caught the FBI’s attention for other reasons.

“A police informant furnished information to the effect that Bud Abbott, the well-known motion picture and television star, is a collector of pornography, and alleged he has 1,500 reels of obscene motion pictures,” an agent wrote in an FBI file.

Of Costello, agents reported: “Information was secured reflecting that two prostitutes put on a lewd performance for Lou Costello,” for which they were paid $50 each.

[. . .]

During the era of legendary FBI director J Edgar Hoover, “you could find a reason to open a file on anyone”, says Steve Rosswurm, a historian at Lake Forest College in Illinois and author of a book about the FBI’s dealings with the Catholic Church.

“The reasons for the surveillance are as varied as the people being watched,” said British writer Nicholas Redfern, author of Celebrity Secrets: Official Government Files on the Rich and Famous

“It was very much dependent upon the character or the situation the subject of the file was in.”

Today, the bureau’s Cold War-era fears of communist infiltration, obscenity and homosexuality sound almost quaint..

February 9, 2012

The heady mix of politics and religion: this is why there’s supposed to be a separation of church and state

Filed under: Government, Liberty, Media, USA — Tags: — Nicholas @ 10:55

At Reason, A. Barton Hinkle on the different ways the media reacts to religious issues under different presidents:

George W. Bush had one small office devoted to faith-based initiatives, and was savaged for it. Barack Obama, on the other hand, says faith drives much of his domestic agenda—and no one even blinks.

We are in “the fourth year of the ministry of George W. Bush,” cracked novelist Philip Roth in 2004. By then, several million gallons of ink already had been spilled warning that Bush’s “faith-based presidency” was “nudging the church-state line” (The New York Times) and was “turning the U.S. into a religious state” (Village Voice) and was “arrogant” and “troubling” (St. Petersburg Times) and was “pandering to Christian zealots” (Salon) and “imposing its values on the rest of us” (too many to name).

Obama has been just as overtly religious as Bush — “We worship an awesome God in the blue states,” he said in his 2004 keynoter at the Democratic National Convention — and even more aggressive about injecting faith into politics. In 2006, he praised a religious “Covenant for a New America.” In a 2008 speech in Ohio, he said religious faith could be “the foundation of a new project of American renewal” and insisted that “secularists are wrong when they ask believers to leave their religion at the door before entering into the public square.” He has kept Bush’s office of faith-based initiatives. In fact, “Obama’s faith-based office has given religious figures a bigger role in influencing White House decisions,” reported USNews in 2009.

At the National Prayer Breakfast last Thursday, the president began by noting that he prays every morning, and then devoted the rest of his speech to explaining the manifold ways in which his faith guides his policies. “I am my brother’s keeper and I am my sister’s keeper,” he said. That somnolent silence you hear is the guardians of church-state separation taking a nap.

Frankly, it still boggles my mind that there’s such a thing as a “National Prayer Breakfast” outside of the annual general meetings of churches.

Michael Pinkus: Apathetic Ontario and the LCBO monopoly

Filed under: Bureaucracy, Cancon, Economics, Government, Liberty, Media — Tags: , , , , , — Nicholas @ 09:12

In the latest issue of his OntarioWineReview.com newsletter, Michael Pinkus again expresses frustration with the government-run monopoly on retail sales of wine and spirits in Ontario:

I have made this point before when talking about the LCBO Food & Drink magazine, which competes directly with other publications in the province for advertising dollars; a magazine that is paid for by the people for the people, which sounds great and a pillar to build a country on, but not when you are competing against the very people who paid the money in the first place (magazine editors, publishers, writers, etc. are taxpayers too). One of the sad realities is that with each bottle a publisher buys they are paying to put themselves out of business.

It’s bad enough that the LCBO are the only game in town to buy booze … it’s bad enough that they waste millions of dollars a year on fancy stores (when they don’t have to) … it’s bad enough that a government run monopoly competes against their own populace and private enterprises for advertising revenue … but now they have to blow dollars on advertising themselves, buying expensive jingles and song rights … is that where you want your tax dollars to go? Could we not find better uses for this money, seriously? And what happened to social responsibility? They are advertising so we’ll buy more — does that seem counter-productive to the social responsibility pact. Heck, I don’t see this many ads for Premier Liquors out of Buffalo, and they have competition.

In the coming weeks we’ll look a little deeper into the LCBO, see what the Auditor General had to say, and read what the pundits are talking about. Find out why our booze prices are being raised mainly because we can’t be trusted as a society to police ourselves when it comes to drinking the devil’s liquid. I just can’t believe that all this is going down and nobody seems to be saying anything on the subject. Over the past few weeks I have been listening to CFRB: John Tory and Jim Richards both made mention, Richards went as far as to speak with Chris Layton (media relations mouthpiece for LCBO) — while both announcers shared their outrage with listeners over various aspects of the LCBO’s conduct (John: advertising; Jim: price raising), the apathetic Ontarians who bothered to call in had very little to say on the matter, many believing the LCBO is doing a bang up job.

A quick search of the blog shows that just about every mention of the LCBO is a negative one. No surprise there: the LCBO is a relic of the post-Prohibition era and is still run in a way that would be familiar to the state-owned “stores” of the old Soviet Union. They are undeniably better both in selection and in service than they used to be, but just about every positive change was wrought by the mere threat that the government of the day was looking at privatization as an option. As soon as the threat went away, the positive changes could be slowed or even stopped: after all, where else are you going to go to buy your wines and spirits?

Boardroom quotas are a bad idea

Filed under: Britain, Economics, Government, Politics — Tags: , , , — Nicholas @ 09:05

James Delingpole on the British government’s half-baked notion to introduce quotas for female board members in business:

I love women. Women are great. I’ve married one, I’ve personally bred one and I’ve got lots who are my friends. And after years of close observation, here’s what I’ve concluded: chicks are definitely the superior species. They’re more intuitive, more versatile, more articulate, more competent. Plus, of course, they have breasts.

Given that all this is so, I really don’t understand why David Cameron feels he needs to impose quota systems on boardrooms. Not for the reasons he gives anyway. I could understand it if he said: “Look, I have no shame, no principles, no moral or ideological core in my blubbery, spineless, Heathite body. My Coalition government is run by Lib Dems, a marketing man and focus groups. And what they all tell me is: “Suck up to the female demographic.” So that’s why I’m saying this crap.”

But that’s not what Cameron has said in Stockholm. He’s actually trying to claim that he’s doing it for the good of British business.

    Government figures suggested that Britain’s slow progress was costing the economy more than £40 billion in lost potential each year, roughly equal to the defence budget.

Yeah right. I’m sure there are also “government figures” which suggest that green technologies will create millions of new jobs; “government figures” which suggest wind farms are a vital part of Britain’s energy package; “government figures” which suggest that a 50 per cent upper band tax rate is really healthy business.

Doesn’t make it so, though does it?

Update: Megan Moore says that the tokenism on display in Cameron’s comments “represents the ultimate triumph of style over substance”:

The first and most obvious objection to boardroom quotas is that they don’t actually work. A 2010 study by Amy Dittmar and Kenneth Ahern of the Ross Business School, University of Michigan, found that in Norway, a 10 percent increase in female board members in a company — enforced through a quota introduced in 2003 — caused the value of the company to drop. After all, if quality is no longer the sole criterion for choosing board members, it is highly likely the quality of the board will suffer.

You’d just as easily make a case for boards being required to match the ethnic, racial, religious, and sexual profile of the country: “Oh, sorry, due to the quotas we can’t invite you to join the board unless you’re Irish or Sikh and are either handicapped or left-handed. Bonus points if you’re transgendered.” Rather than emphasizing the needs of the organization — hiring someone who brings skills, talents, or connections that the organization can benefit from — this kind of social engineering only values people for their plumbing or their skin colour, or their sexual lifestyle.

February 7, 2012

Finns vote to stick with the EU

Filed under: Europe, Government — Tags: , , — Nicholas @ 10:48

A summary of the recent presidential election results in Finland, from The Economist:

Those who argued that Finland is fast becoming a Eurosceptic country that is against the country’s membership of the European single currency, the euro, have been proved wrong by its presidential election. The run-off on February 5th was contested between the two most pro-European candidates. Timo Soini, leader of the anti-euro True Finns, which took a spectacular 18% of the vote in the general election last April, was humiliatingly pushed out in the first round. The winner, Sauli Niinisto, a former centre-right finance minister, took 63% of the vote to 37% for the loser, Pekka Haavisto of the Greens (who was also the first openly gay candidate for the post).

Mr Niinisto declares himself to be firmly in the pro-EU, pro-euro camp—indeed, as finance minister he helped get the country into the euro in the first place. That matters because the Finnish presidency is more than a ceremonial post, especially in foreign policy, even if recent constitutional changes have made it weaker than it once was. Most power, especially in domestic issues, rests with the government, a cumbersome six-party coalition led by Jyrki Katainen, the conservative prime minister. The arrival in the presidential palace of Mr Niinisto, a fellow conservative, will strengthen Mr Katainen’s hand. Yet strains within the coalition, which was designed largely to keep the True Finns out of power, are likely to persist.

February 6, 2012

America’s boom in “Moocher Culture”

Filed under: Books, Economics, Government, Politics, USA — Tags: , , , , — Nicholas @ 00:08

Glenn Harlan Reynolds in the Washington Examiner explains why the growth in something-for-nothing attitudes can and will come to grief:

“Fifty thousand for what you didn’t plant, for what didn’t grow. That’s modern farming — reap what you don’t sow.”

That’s a line from a song about farm subsidies, “Farming The Government,” by the Nebraska Guitar Militia.

But these days it applies to more and more of the U.S. economy, as Charles Sykes points out in his new book, A Nation Of Moochers: America’s Addiction To Getting Something For Nothing.

The problem, Sykes points out, is that you can’t run an economy like that. If you tried to hold a series of potluck dinners where a majority brought nothing to the table, but felt entitled to eat their fill, it would probably work out badly. Yet that’s essentially what we’re doing.

[. . .]

But the damage goes deeper. Sykes writes, “In contemporary America, we now have two parallel cultures: An anachronistic culture of independence and responsibility, and the emerging moocher culture.

“We continually draw on the reserves of that older culture, with the unspoken assumption that it will always be there to mooch from and that responsibility and hard work are simply givens. But to sustain deadbeats, others have to pay their bills on time.”

And, after a while, people who pay their bills on time start to feel like suckers. I think we’ve reached that point now:

  • People who pay their mortgages — often at considerable personal sacrifice — see others who didn’t bother get special assistance.
  • People who took jobs they didn’t particularly want just to pay the bills see others who didn’t getting extended unemployment benefits.
  • People who took risks to build their businesses and succeeded see others, who failed, getting bailouts. It rankles at all levels.

And an important point of Sykes’ book is that moocher-culture isn’t limited to farmers or welfare queens. The moocher-vs-sucker divide isn’t between the rich and poor, but between those who support themselves and those nursing at the government teat.

February 4, 2012

“Fake the oath” to become the new “Jump the shark”

Filed under: Cancon, Government, Media — Tags: , , — Nicholas @ 12:26

Chris Selley wonders why anyone outside the Ottawa media bubble would care about the Sun Media (or as Paul Wells usually spells it in his tweets, “Sun Meida”) faking the citizenship ceremony for a TV broadcast:

“Let’s do it. We can fake the Oath.” That is the universally accepted money quote, courtesy of a Sun News producer, to come out of this week’s fracas involving the fledgling cable news network, the Ministry of Citizenship and Immigration and a citizenship ceremony that wasn’t quite what it seemed. On Oct. 19, during Citizenship Week, Sun viewers were told they were watching 10 people become Canadian citizens. Instead they were watching 10 citizens, six of whom were federal bureaucrats, reaffirm their Canadian citizenship.

“Congratulations to all of the new Canadians here,” co-host Alex Pierson gushed. “Ten of you here at Sun News Network, finally Canadian citizens!”

“Fake the Oath” certainly has the ring of legend. I think it could be to the Canadian media what “jump the shark” is to situation comedy. An example: “Oh for God’s sake, [insert media outlet], a talking dog on YouTube is news now? You guys have finally faked the Oath!”

But having gone through the documents behind this story, which were obtained by Canadian Press through Access to Information, I’m struggling to understand the amount of coverage this story got. Well, OK, I sort of understand it: Pointing and laughing at Sun Media is a national pastime among journalists and liberals these days. What I can’t figure out is how this matters.

When Canada’s Department of Transport became transphobic

Filed under: Bureaucracy, Cancon, Government, Liberty — Tags: , , , , — Nicholas @ 11:48

Tabatha Southey has an interesting article in the Globe & Mail. I was unaware that the Canadian Forces now support transitioning transgendered soldiers (and have done for more than a decade), but that another branch of the government headed in quite the opposite direction last year:

While I think we should take the transgender community’s word for it — that transitioning works to transform often excruciatingly unhappy gender-dysphoric people into contented people — there are lots of studies that back them up as well.

It’s hardly something that anyone would do for kicks. Transitioning isn’t for sissies, which is why it’s heart-warming that our military made a practical and humane decision to accommodate transgender soldiers. And it’s also why it’s unfortunate that since July, 2011, a Department of Transport rule has been on the books that could prevent those same transitioning soldiers from flying home for Christmas.

The existence of this rule was brought to light this week by blogger Jennifer McCreath. It states that if “a passenger does not appear to be of the gender indicated on the identification he or she presents,” that person is not allowed to fly.

I’m prepared to believe those who say transgender and inter-sex people aren’t the demographic the rule aims to catch, but that leaves me wondering who it is the authorities are trying to nab.

February 3, 2012

Paul Wells: Harper and the Tories acted like “trust fund kids”

Filed under: Cancon, Economics, Government — Tags: , , , — Nicholas @ 11:06

An interesting column at Maclean’s this week, where Paul Wells recasts Stephen Harper’s recent speech at Davos as autobiographical confession:

This passage should be read as thinly veiled autobiography and confession. This week a former senior public servant told me that when the Conservatives came to power in 2006, they inherited structural surpluses, booming oil prices and shrinking public debt, and they acted the way trust-fund kids do. “These were like kids in a candy store who had all this allowance. ‘Wow, we can do all this stuff?’ ”

But don’t take my nameless source’s name for it. Take Jim Flaherty’s. His first budget speech, in 2006, carried the title “Focusing on Priorities.” And what did he describe as priorities? In order: “Providing immediate and substantial tax relief,” he said. “Encouraging the skilled trades.” “Families and communities.” “Investing in infrastructure.” “Security.” “Accountability.” “Expenditure management.” “Restoring fiscal balance for our Canadian federation.” And right down there at the bottom, “prosperity.” So you can’t say it wasn’t the No. 1 priority. It’s right there in ninth place.

In Flaherty’s 2007 budget speech, the word “growth” appeared once.

But sometimes the world changes and the trust fund goes bust. For Harper, that happened in the first week of December 2008, when he had to fight like a street gang to keep the job he thought he’d just been re-elected to. So much changed after that. He won in 2011 by running on the economy after years of running away from it. And now here he was in Davos to tell everyone about “the good, growth-oriented policies. The right, often tough choices.”

Flaherty is my local MP, so I’m well acquainted with his habit of talking like a conservative, but running the finance ministry like one of Pierre Trudeau’s acolytes. It must really be galling him that he has to act like a grown-up for the coming budget. As I’ve said more than once, if you factor out the military and foreign affairs aspects, there were few things that Harper did that wouldn’t have been done just as readily by Paul Martin. And I mean Martin as PM, not in his more successful guise as minister of finance.

Lemonade stand economics and government accounting

Filed under: Economics, Government — Tags: , , — Nicholas @ 10:14

An amusing illustration of the differences between real world profit and loss and the government’s accounting methods:

Parents, wanting to encourage the idea that working and making money is a good idea, drive around to buy the lemon, sugar, designer bottled water, cups, spoons, napkins, a sign or two, and probably a paper table cloth.

Aside from time and gas, the outing adds up to something north of $10. At the opening of business the next day, the kids find business is slow to nonexistent at $1 per cup. So, they start to learn about market demand and find that business becomes so brisk at only 10 cents per cup that they are sold out by noon, having served 70 cups of lemonade and hauled in $7.

[. . .]

There is a strand of economics, we’ll call it the K-brand, that sees all this as worthwhile. They add together the $10 spent by the parents to back the venture and the $7 spent by the customers and conclude that an additional $17 of spending is clearly a good thing. Surely, the neighborhood economy has been stimulated.

To the family it is a loss, chalked up as a form of consumption. If this were a business enterprise it would be a write-off. In classical economics it is a “mal-investment.”

[. . .]

But that is not how it works in government accounting. While a private business must adjust its books to reflect the losses from an intended investment that went bad, governments never do that.

When a government “invests” in, say, an airport in Johnstown, Pa., all the expenditures for labor and materials are recorded as investments and are additions to national output. Never mind that when it is later discovered that only three people a day want to fly to or from the airport, no adjustment to national wealth will reflect the folly of this “mal-investment.”

If the airport had been financed by purely private, commercial enterprises, the initial expenditures would have been recorded as investment spending, but when reality struck and the entire project was written off as a total loss, the business-profit component of national output would decline. That is, a previous bad “investment” reduces, rather than augments, current national income.

New economic ideas on employment and stimulus

Filed under: Economics, Government — Tags: , , , — Nicholas @ 10:03

Arnold Kling, writing in the Wall Street Journal, explains why (if his new theories are validated) governments have been doing exactly the wrong things to help the economy recover:

… I believe that the process of creating employment is explained not by the theories of Keynes, but rather by the theories of Adam Smith and David Ricardo. Smith famously described the advantages of specialization and division of labor. Ricardo pointed out the gains from trade that come from consuming goods that others produce more efficiently. From the perspective of Smith and Ricardo, real jobs emerge in the context of patterns of sustainable specialization and trade.

Unfortunately, the patterns of specialization and trade that had emerged five years ago were not sustainable. Many jobs in home construction, durable-goods manufacturing and distribution, and mortgage finance were dependent on housing markets with ever-rising prices. In the U.S. and the U.K. in particular, the finance industry expanded well beyond its true economic value. Once the property bubbles burst, these jobs were exposed as not viable. Meanwhile, ongoing creative destruction brought about by the Internet and globalization have continued to allow substitution of capital and emerging-market labor for industrialized countries’ labor in many sectors. Together, these phenomena have caused widespread dislocation.

More government spending will not bring back the days when supposedly triple-A-rated mortgage securities could be fashioned out of dodgy loans to unqualified borrowers. Doing so would not halt the ongoing improvements in productivity in manufacturing and retail trade. It would not facilitate the adjustments that are needed in the mix of skills in the labor force. The necessary adjustments can only be made by the decentralized efforts of entrepreneurs.

[. . .]

The word “sustainable” in “patterns of sustainable specialization and trade” refers to profitability. Patterns that are profitable can be sustained. Patterns that are not profitable must eventually be shut down. That is the problem with patterns of trade created by government borrowing and spending: They are not sustainable, as has been illustrated in the U.S. by the failure of many of the “green energy” companies supported by President Obama’s stimulus package. Moreover, as European policy makers have discovered, there are limits to how much governments can borrow to fund their experimentations in specialization and trade.

February 2, 2012

Is Sino-Forest a typical Chinese company?

Filed under: China, Economics, Government, Law — Tags: , , , — Nicholas @ 09:52

Colby Cosh posted an initial article on the investigation into Sino-Forest’s business back in June:

Timber company Sino-Forest is locked in a fascinating battle for survival against Carson Block, a stock analyst with a mixed record of publicity attacks on Chinese-based enterprises. With professional analysts reluctant to say what they make of Block’s “strong sell” report on Sino-Forest, I’m in no position to endorse it as a piece of financial advice or investigative journalism. Considered strictly as entertainment, however, the report is remarkable.

Block has documented that Sino-Forest operates with extraordinary opacity for a company whose holdings are surely very widely distributed — particularly, one assumes, within Canada. Sino-Forest claims to be doing hundreds of millions of dollars’ worth of sales through mostly unidentified “authorized intermediaries” in China — traders who are apparently happy to let the company buy title to trees, hold them as they appreciate, take on the bulk of the costs and risks in the meantime, and then snap up revenues when the trees are eventually converted into wood products. Block, having poked around a bit in the literal Chinese backwoods, questions whether much if any of the reported underlying activity is happening.

[. . .]

Sino-Forest is refusing, despite intense pressure, to make a full disclosure of the identities of the “authorized intermediaries” who are making its money. The company claims that to do so would put it at a competitive disadvantage, which makes one wonder why its business model ought to depend so heavily on sheer obscurity. One possible answer is that Sino-Forest’s real, fundamental business is some sort of cryptic regulatory arbitrage; that seems like a game potentially worth playing with paper assets in places that have a strong rule of law, but it is surely a dangerous one in a nominally Communist country, where a nationalization could be arranged in the space of an afternoon. (Or where some regional Party functionary could simply be bribed to “lose” crucial paperwork.)

Today, he posted a follow-up report:

Could a curious investor look at actual maps of timber controlled by Sino-Forest agents, you ask? Well, you see, it’s not exactly kosher for foreigners to carry around maps of remote parts of China. You can borrow them from forestry officials if you really need to. Will the local forestry bureaus confirm Sino-Forest’s claims about plantations operated by its agents? Well, sometimes they’ll give you a certificate of sorts, for all the good it might do. “The confirmations are not title documents, in the Western sense of that term,” the committee report notes. (As I understand it, the Western meaning of “title document” is that it gives one an unquestioned, justiciable claim to ownership of something, whether the Party or the Army or the good Lord in heaven approve or not.)

[. . .]

The impression given is that you need influential “backers” to do business in China. The question for the Western investor, though it’s probably now moot, is whether the real role of these backers is to help exploit Chinese resources for the benefit of the Western shareholders or to help fleece Western shareholders for the benefit of Chinese suppliers and bureaucrats.

As Jon, my former virtual landlord puts it, this is a hobby horse I like to ride now and again.

February 1, 2012

The “Iron Lady” was not good for women

Filed under: Britain, Government, History — Tags: , , , — Nicholas @ 11:06

Barbara Kay on the “failings” of Margaret Thatcher (that is, not advancing the cause of women in a way that organized feminists would have preferred):

The “Iron Lady” is, of course, not only a sobriquet for Margaret Thatcher, but the title of the wonderful new Meryl Streep biopic about the former British PM. Bagnall’s predictable answer is that no, Thatcher was not good for women: “She did not pave the way for other women, as they had every right to expect her to, since she was one of them.”

Bagnall’s stated beefs are that Thatcher urged women to leave the workforce, and only nominated one woman to her cabinet. Well, so did unions of that era ask women to leave the workforce — to open up more jobs for men. And Thatcher’s appointments were based on who was good for Britain, not who was good for women.

Politically, Thatcher despised tokenism (“I owe nothing to women’s lib,” she once said), but it is true that personally she preferred men to women. This was made clear in the film by the non-judgmental tenderness the older widowed Thatcher lavishes on her negligent son (who rarely visited, but inconsiderately telephones her from South Africa at 3 a.m. English time) and the casual verbal cruelties Thatcher tosses at her attentive, under-appreciated daughter.

I think it’s Thatcher’s lack of fellow feeling for women that’s really bugging Bagnall and other feminists. How could Thatcher not like women if she was “one of them”?

I daresay it’s for the same reason most of us hold prejudices about the opposite sex. I don’t think most gender antipathy is rooted in doctrine; I think we drift toward doctrines that confirm our lived experiences. So in spite of (fictional) Thatcher’s protestations to the doctor attending her in her old age that she prefers “thoughts” to “feelings,” Thatcher’s bias toward men sprang directly from her lived experiences and the feelings they engendered (pun intended).

January 31, 2012

Andrew Coyne on the sudden appearance of Stephen Harper’s “hidden agenda”

Filed under: Cancon, Economics, Government, Politics — Tags: , , , , — Nicholas @ 12:19

We’ve been waiting for it to appear since the 1990’s, so it’s about time that it finally put in a cameo:

At last, the hidden agenda, and not a moment too soon. Vague, indirect and overseas as it was, Stephen Harper’s Davos speech was perilously close to a vision statement, of a kind the prime minister has seldom made until now, and will henceforth have to make often.

It would be nice if he had shared with us his concerns about the ageing of the population, and the threat it poses to our long-run social and economic health, sometime before the last election, rather than joining in the all-party consensus that there was nothing wrong with Canada that could not be fixed with more and richer promises to the elderly.

[. . .]

How serious is the cost side of this conundrum? The president of the C. D. Howe Institute, Bill Robson, has projected the “net unfunded liability” implied by this unprecedented demographic shift — that is, promises to pay benefits out of public funds for which we have made no provision in taxes, “net” of any savings from having fewer children about — at about $2.8-trillion. With a T, ladies and gentlemen: about 160% of GDP. (That’s in addition to the $800-billion unfunded liability in the Canada Pension Plan and its Quebec counterpart — yes, they are pulling in enough each year to meet their current obligations, but that does not mean they are “fully funded,” the prime minister’s claims to the contrary — to say nothing of the $600-billion national debt.)

Germany issues “secret” document to Greek government on debt repayment

Filed under: Economics, Europe, Germany, Government, Greece, Politics — Tags: , — Nicholas @ 09:41

Mick Hume recounts the machinations within the European Union:

One outraged Greek government minister described it as ‘the product of a sick imagination’. Another called it ‘absolutely laughable’. The formal title of the document in question is ‘Assurance of Compliance in the Second GRC Programme’. It is neither a joke, nor a sick fantasy. It reads more like the draft of a death warrant for democracy, first in Greece and then elsewhere in Europe.

This supposedly secret document was issued by Angela Merkel’s German government to its partners in the Eurozone — and then carefully leaked, to ensure maximum impact. It sets out two extraordinary measures that the Germans want to impose to ensure that the Greek authorities comply with the swingeing budget cuts which they promised but have apparently failed to deliver to the markets’ satisfaction.

First, it says Greece must ‘legally commit itself to giving absolute priority to future debt service’. All state revenues must go first to paying debts and interest due, before a cent can be spent on public services. And the Greek government will not be allowed to threaten to default on its debts in future; if it cannot pay, it must accept that ‘further cuts’ will be ‘the only possible consequence’.

Second, the Germans want the Eurozone to oversee the ‘transfer of national budgetary sovereignty’ from Greece to ‘the European level’ under a ‘strict steering and control system’. The plan is for the Eurozone group to appoint a budget commissioner to oversee Greek finances, with the power ‘to veto decisions not in line with the budgetary targets’ set by European and international officials. If that was not humiliating enough, the Greeks would also have to look happy to bend the knee by ensuring that this new system of outside control ‘is fully enshrined in national law, preferably through constitutional amendment’.

To get the Greeks to agree to these unprecedented conditions, the German document also offers incentives — or as we used to call it, threats. If Athens does not accept the compliance measures, then ‘the Eurozone will not be able to approve guarantees for GRC II’. That is the second huge bailout of €130 billion which Greece desperately needs if it is not to go officially bust in weeks. The ‘Assurance of Compliance’ document is a ‘secret’ blackmail note.

Update: Ah, Monty captures the absurd state of the EU perfectly in a throw-away line in today’s Daily DOOM — “Like German porn, the politics of the Greek bailout just keep getting weirder and more complicated.”

« Newer Posts — Older Posts »

Powered by WordPress