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Posted on Sustainabilitank.info on March 8th, 2014
by Pincas Jawetz (PJ@SustainabiliTank.com)

 

 

A Tsar’s Bride Dmitri Tcherniakov has set this Rimsky-Korsakov work, with Olga Peretyatko (in white suit) in the title role, in a TV studio, at the Teatro alla Scala in Milan. Credit Brescia/Amisano-Teatro alla Scala

 

MILAN — The Oprichniks were the murderous henchmen of Ivan the Terrible, torturing and killing the czar’s enemies.

It says a lot about the Russian director Dmitri Tcherniakov’s world view that he has chosen to reimagine these thugs as contemporary television executives in his exhilarating production of Rimsky-Korsakov’s “The Tsar’s Bride” at the Teatro alla Scala here. This lurid tale of jealousy, insanity and the search for a royal wife has become, in Mr. Tcherniakov’s alchemical hands, a vivid, unsettling reflection on the media and the fast-disintegrating line between what seems real and what is.

It isn’t the first time that this director has brought a new angle to an older work. His charged, often claustrophobic interpretations of operas like Mozart’s “Don Giovanni” and Verdi’s “Il Trovatore” over the past few years have revealed fresh narratives and unexpected emphases in well-trodden classics. Just last month at the Metropolitan Opera, his new production of Borodin’s “Prince Igor” added some sections, cut others and rearranged what was left to create a dreamy portrait of a ruler and society thrown out of joint by the hunger for war.

Ms. Peretyatko, left, and the mezzo Anna Lapkovskaja in ‘‘The Tsar’s Bride.’’ Credit Brescia/Amisano-Teatro alla Scala

 

But “Prince Igor” is a torso. Borodin never finished it and, as far as an overarching structure, barely even started it, a fact that even the Met’s strong production couldn’t conceal. While Mr. Tcherniakov’s version of “Igor” showed craft and care, it was bracing on Wednesday, at the second performance of “The Tsar’s Bride,” to see what he is capable of when he actually has a full opera to work with.

Like many Russian masterpieces, this Rimsky-Korsakov piece, which premiered in 1899, is still a relative rarity in the West, and it hasn’t always gotten the respect it deserves. It can seem, at first glance, a rather superficially sumptuous melodrama. But this performance made a strong case for its glimmers of forward-thinking angularity as well as its late-Verdian propulsion: it is an assemblage of set pieces — arias, ensembles, choruses — that presses forward with vigor.

The plot takes its cue from an encyclopedia footnote about which little is known: Ivan the Terrible’s brief third marriage to a commoner who was selected from 12 finalists for his hand and who died mysteriously a few days after their wedding. In the opera, this young woman, Marfa, is the pawn in a tangled love story that leaves her insane, succumbing to poison, and several other people dead.

The odd thing about Rimsky-Korsakov’s telling is that while there’s certainly a bride in it, there’s no czar. The one time in the original libretto that the fearsome Ivan seems to enter the picture, we’re not even sure it’s him: Marfa and her friend think they recognize his dreadful eyes in an anonymous man on horseback.

First at the Berlin Staatsoper in October and now in Milan, and both times with Daniel Barenboim conducting, Mr. Tcherniakov has taken this empty space at the opera’s core and run with it. The curtain rises on a TV studio where what seems to be a storybook pageant about old Russia is being filmed.

Before the overture is over, video projections bring us into an online chat among the Oprichnik-executives, who propose the need to invent a fake czar. A computer-generated leader is swiftly created for the public to revere and fear, and a “Bachelor”-style competition is started to help choose his bride.

At its heart this is yet another iteration of the theater-within-the-theater conceit that has tripped up even gifted directors. (See Stefan Herheim’s London production of Verdi’s “Les Vêpres Siciliennes” last fall.) But Mr. Tcherniakov makes it work with the fresh energy of his concept and the vital performances he draws from his cast.

All the world’s a screen in this “Tsar’s Bride,” a society distinguished most by the ceaseless generation and consumption of “content.” So Lyubasha, driven to desperation by jealousy, performs part of her first-act monologue in front of the cameras in an empty studio.

At the end, the innocent Marfa’s mad scene is filmed — ready to join happier, earlier clips flickering on the studio monitors. Becoming a media spectacle may be the most fitting way for her to go, in a live-by-the-sword, die-by-the-sword way: Throughout the previous acts, the Oprichniks’ product — a manufactured reality, half-news, half-entertainment — has been gobbled up from the television at Marfa’s family’s home. (We glimpse a few seconds of battle footage, too, lest anyone forget what all the fuss about a royal wedding is distracting from.)

Mr. Tcherniakov’s tweaks yield some of the production’s most effective moments. In the original libretto, the vindictive Lyubasha secretly spies on Marfa, her romantic rival. But here the encounter was face to face, making Lyubasha’s furious vows both more terrifying and more pitiable.

This director designed his own set, as is his usual practice, and it is a rotating wonder that makes possible, for instance, an elegant transition into the first-act trio. The world of the opera is rendered as a hermetic, arid interior. Nature is just another image, whether in the form of video of sun-dappled leaves or in the flowered wallpaper of Marfa’s living room.

The intense performances, not least that of the theater’s vibrant chorus, popped against this stark setting. The dusky-voiced mezzo Marina Prudenskaya’s Lyubasha was a small miracle of barely contained despair. The tenor Pavel Cernoch was a bright-voiced wimp as Marfa’s childhood sweetheart, Lykov, and the bass Anatoli Kotscherga a bearish presence as her father, Sobakin.

His baritone husky and lithe, Johannes Martin Kränzle was a bitter cynic at the heart of a cruel game as Gryaznoy, the Oprichnik mastermind of the czar’s bride scheme. The mezzo Anna Lapkovskaja was warm-hearted and warm-toned as Marfa’s friend, Dunyasha. The veteran soprano Anna Tomowa-Sintow was touchingly deluded as her mother, Saburova.

Her voice and manner agile and girlish in the early acts, the soprano Olga Peretyatko was transformed into a bitter Norma Desmond lookalike for a riveting mad scene, her eyes glittering under the studio spotlights. (She gets another descent into insanity next month as Elvira in Bellini’s “I Puritani” for her Metropolitan Opera debut.)

Mr. Barenboim brought out the music’s broad sweep and agitated details in moments like the febrile trembling as Gryaznoy toasts the bride-to-be in Act 3. He led the brass blasts at the start of the fourth act, each of which recedes into quiet unease, with a tautness and weight that revealed their debt to the opening of Wagner’s “Götterdämmerung.”

I wondered how the plusher Metropolitan Opera Orchestra would sound in this score, which has never been performed at the Met. I hope to have the chance to find out before too long, perhaps in Mr. Tcherniakov’s daringly theatrical production, a natural fit if ever there was one for media-driven New York.

The Tsar’s Bride. Directed by Dmitri Tcherniakov. Teatro alla Scala, Milan.Through March 14. teatroallascala.org.

 

 

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Posted on Sustainabilitank.info on February 17th, 2014
by Pincas Jawetz (PJ@SustainabiliTank.com)

 

Surveillance revelations: Angela Merkel proposes European network to beat NSA and GCHQ spying.

 

 

 

 

Tony Paterson of The Independent writes from Berlin, February 16, 2014 – “Chancellor Angela Merkel of Germany has announced plans to set up a European communications network as part of a broad counter-espionage offensive designed to curb mass surveillance conducted by the US National Security Agency (NSA) and its British counterpart, GCHQ.”

{we add here that expected to be left out of the new European defense will be the other Anglo-Saxon partners in the spying conspiracy – the Australian-New Zealand and Canadian allies for the US spying for business deal. We also predict that Germany would love an independent Scotland replacing the present UK membership in the EU.}

The move is her government’s first tangible response to public and political indignation over NSA and GCHQ spying in Europe, which was exposed last October with revelations that the US had bugged Ms Merkel’s mobile phone and that MI6 operated a listening post from the British Embassy in Berlin.

Announcing the project in her weekly podcast, Ms Merkel said she envisaged setting up a European communications network which would offer protection from NSA surveillance by side-stepping the current arrangement whereby emails and other internet data automatically pass through the United States.

The NSA’s German phone and internet surveillance operation is reported to be one of the biggest in the EU. In co-operation with GCHQ it has direct access to undersea cables carrying transatlantic communications between Europe and the US.

Ms Merkel said she planned to discuss the project with the French President, François Hollande, when she meets him in Paris on Wednesday. “Above all we’ll talk about European providers that offer security to our citizens, so that one shouldn’t have to send emails and other information across the Atlantic,” she said. “Rather one could build up a communications network inside Europe.”

French government officials responded by saying Paris intended to “take up” the German initiative.

Ms Merkel’s proposals appear to be part of a wider German counter-espionage offensive, reported to be under way in several of Germany’s intelligence agencies, against NSA and GCHQ surveillance.

Der Spiegel magazine said on Sunday that it had obtained information about plans by Germany’s main domestic intelligence agency, the Federal Office for the Protection of the Constitution, for a “massive” increase in counter-espionage measures.

The magazine said there were plans to subject both the American and British Embassies in Berlin to surveillance. It said the measures would include obtaining exact details about intelligence agents who were accredited as diplomats, and information about the technology being used within the embassies.

Last year information provided by the whistleblower Edward Snowden revealed that US intelligence agents were able to bug Ms Merkel’s mobile phone from a listening post on the US Embassy roof. Investigations by The Independent subsequently revealed that GCHQ ran a similar listening post from the roof of the British Embassy in Berlin.

Intelligence experts say it is difficult if not impossible to control spying activities conducted from foreign embassies, not least because their diplomatic status means they are protected from the domestic legislation of the host country.

Der Spiegel said Germany’s military intelligence service, (MAD) was also considering stepping up surveillance of US and British spying activities. It said such a move would mark a significant break with previous counter-espionage practice which had focused on countries such as China, North Korea and Russia.

Germany’s counter-espionage drive comes after months of repeated and abortive attempts by its officials to reach a friendly “no spy” agreement with the US. Phillip Missfelder, a spokesman for Ms Merkel’s government, admitted recently that revelations about NSA spying had brought relations with Washington to their worst level since the US-led invasion of Iraq in 2003.

Der Spiegel claimed that on a single day last year, January 7, the NSA tapped into some 60 million German phone calls. The magazine said that Canada, Australia, Britain and New Zealand were exempt from NSA surveillance but Germany was regarded as a country open to “spy attacks”.

The move is her government’s first tangible response to public and political indignation over NSA and GCHQ spying in Europe, which was exposed last October with revelations that the US had bugged Ms Merkel’s mobile phone and that MI6 operated a listening post from the British Embassy in Berlin.

Announcing the project in her weekly podcast, Ms Merkel said she envisaged setting up a European communications network which would offer protection from NSA surveillance by side-stepping the current arrangement whereby emails and other internet data automatically pass through the United States.

The NSA’s German phone and internet surveillance operation is reported to be one of the biggest in the EU. In co-operation with GCHQ it has direct access to undersea cables carrying transatlantic communications between Europe and the US.

Ms Merkel said she planned to discuss the project with the French President, François Hollande, when she meets him in Paris on Wednesday. “Above all we’ll talk about European providers that offer security to our citizens, so that one shouldn’t have to send emails and other information across the Atlantic,” she said. “Rather one could build up a communications network inside Europe.”

French government officials responded by saying Paris intended to “take up” the German initiative.

Ms Merkel’s proposals appear to be part of a wider German counter-espionage offensive, reported to be under way in several of Germany’s intelligence agencies, against NSA and GCHQ surveillance.

Der Spiegel magazine said on Sunday that it had obtained information about plans by Germany’s main domestic intelligence agency, the Federal Office for the Protection of the Constitution, for a “massive” increase in counter-espionage measures.

The magazine said there were plans to subject both the American and British Embassies in Berlin to surveillance. It said the measures would include obtaining exact details about intelligence agents who were accredited as diplomats, and information about the technology being used within the embassies.

Last year information provided by the whistleblower Edward Snowden revealed that US intelligence agents were able to bug Ms Merkel’s mobile phone from a listening post on the US Embassy roof. Investigations by The Independent subsequently revealed that GCHQ ran a similar listening post from the roof of the British Embassy in Berlin.

Intelligence experts say it is difficult if not impossible to control spying activities conducted from foreign embassies, not least because their diplomatic status means they are protected from the domestic legislation of the host country.

Der Spiegel said Germany’s military intelligence service, (MAD) was also considering stepping up surveillance of US and British spying activities. It said such a move would mark a significant break with previous counter-espionage practice which had focused on countries such as China, North Korea and Russia.

Germany’s counter-espionage drive comes after months of repeated and abortive attempts by its officials to reach a friendly “no spy” agreement with the US. Phillip Missfelder, a spokesman for Ms Merkel’s government, admitted recently that revelations about NSA spying had brought relations with Washington to their worst level since the US-led invasion of Iraq in 2003.

Der Spiegel claimed that on a single day last year, January 7, the NSA tapped into some 60 million German phone calls. The magazine said that Canada, Australia, Britain and New Zealand were exempt from NSA surveillance but Germany was regarded as a country open to “spy attacks”.

 

 

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Posted on Sustainabilitank.info on July 8th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

THINGS GET MESSIER AND MESSIER – THE FOLLOWING IS A MASTERPIECE!OR SHOULD WE SAY – A MESSPIECE !!


“What If Snowden Was on Board the Bolivian President’s Jet?”

Violeta Ayala* – a *Bolivian “Imdian” filmmaker writes in The Huffington Post on July 4th but shown to us only now.

A month ago I was invited to a lunch in La Paz, the highest capital in the world and the capital of my country Bolivia. It was at the stylish residence of the French ambassador. We were a group of filmmakers, invited to wine and dine at the embassy. Two of us were indigenous and the rest belonged to the traditional ruling class of Bolivia. Sitting around a fancy table with diplomats, a butler served us quiche and wine.

During lunch, the French Ambassador made a comment about Bolivia, saying, it had taken France hundreds of years to become a Republic and that we need to forget in Bolivia about this business of being Indigenous or European. Then he said, “Bolivia is just being born.”

I felt like my head was about to explode and I can tell you, it wasn’t the wine or the altitude!

“Excuse me dear Ambassador, who has just been born? My people have lived on this land for thousands of years. We built an empire that you helped to destroy, but today we have an indigenous President of Aymaran origin, Evo Morales who was elected democratically in 2005. The idea of a Republic might have worked in France, but not in The Plurinational State of Bolivia, a multi-ethnic country with 38 official languages!”

This little incident made me think about how much respect European countries actually have for my people.

Last night, when I was in Paris of all places, I heard the news and I felt the fuzzy feeling of another head explosion. I’d just seen on Twitter that Bolivia’s presidential jet carrying Evo Morales was denied permission to fly through French, Portuguese and Italian airspace on route to Bolivia on the grounds of a rumor. It was suspected Edward Snowden was hiding on board winging his way to safety in Bolivia.

President Morales had been visiting Moscow, as one of the 13 members of the Gas Exporting Countries Forum (GECF). An overlooked fact, however, is that while he was in Moscow, President Morales’ jet was never at Sheremetyevo airport where Edward Snowden is supposed to be waiting in transit. It seems like a bad joke that with all the access the NSA has to everyone’s email and phone calls that they couldn’t figure out if one guy was on a plane.

So, where did the rumor start?

Was it the U.S. government’s intention to stop Evo’s plane? Or was it to scare Bolivia, because Evo Morales had said he would consider an asylum request from Snowden? Or to scare any country who might consider helping Snowden? Or was it to scare Snowden himself so he stays put in Russia and has no other option but to accept Putin’s condition to stop releasing more documents?

The intentions are anyone’s guess, but what would the U.S. response have been if Obama’s jet, Air Force One, had received the same treatment as Bolivia’s president and been forced down while on route to Washington?

As for the rumors about Snowden being on Evo’s jet… Beyond ridiculous. How do you think Russia would react if Snowden disappeared from under the watchful eye of Russian security? I have no doubt President Putin is happy to have Snowden in transit waiting to play him as a pawn at the right time. The U.S. Government can’t be that naïve to think a good-hearted Putin would let Snowden go so easily? Would the U.S. allow a Russian whistleblower to slip through their fingers at the airport in Washington?

I think we can say for certain that all the countries involved in this little saga knew Snowden wasn’t on or anywhere near the Bolivian presidential jet. But what if, hypothetically Snowden was able to sneak past the FSB, Russian police, airport security and get on that plane? The Bolivian government has the right to grant asylum to whomever they decide is facing persecution.

I would like people to know that today the U.S. hosts some of Bolivia’s largest criminals. One such person is the former president, Gonzalo Sanchez de Lozada, and two of his ministers who are wanted in Bolivia, not for information leaks, but to face charges for the killing of 60 people who were protesting against his government’s policies to sell Bolivia’s resources to U.S. corporations. Sanchez de Lozada escaped Bolivia in a jet in 2003 and to this day the U.S. refuses to accept Bolivia’s extradition request for him.

I can only wonder looking out my hotel window in Paris why the French government started this nonsense that could have put the life of Bolivia’s president at risk?

Remember, it wasn’t the U.S. refusing air space to a presidential jet; it was the Republic of France, an independent country founded on the principles of Liberte, Egalite and Fraternite, refusing air space to a jet carrying the first indigenous president of Bolivia.

And now, the French government has said they didn’t know Bolivia’s president Evo Morales was on the presidential jet, the Spanish government say they didn’t do it, and the Portuguese say it was a technical problem.

Today is the 4th of July and the Union of South American Nations (UNASUR) is holding an emergency meeting in my hometown of Cochabamba to formulate their response to what was done to Bolivia’s presidential plane. Evo Morales has threatened to close the U.S. Embassy in Bolivia and the “Poncho Rojos” — Aymara Warriors have burned French flags outside the French Embassy in La Paz as a symbolic declaration of war.

As for me I celebrated the constitution of freedom of the founding fathers of the United States of America, with a glass of champagne next to a canal in the very country that gave the Statue of Liberty to the USA.

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Posted on Sustainabilitank.info on July 8th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)


Daniel Ellsberg: Edward Snowden was right to flee.

The man who leaked the Pentagon Papers says the NSA leaker could not speak out if he had stayed.

That was then – and now is now!!!

Opinions
Snowden made the right call when he fled the U.S.
By Daniel Ellsberg, In The Washington Post of July 8, 2013.

Daniel Ellsberg is the author of “Secrets: A Memoir of Vietnam and the Pentagon Papers.” He was charged in 1971 under the Espionage Act as well as for theft and conspiracy for copying the Pentagon Papers. The trial was dismissed in 1973 after evidence of government misconduct, including illegal wiretapping, was introduced in court.

Many people compare Edward Snowden to me unfavorably for leaving the country and seeking asylum, rather than facing trial as I did. I don’t agree. The country I stayed in was a different America, a long time ago.

After the New York Times had been enjoined from publishing the Pentagon Papers — on June 15, 1971, the first prior restraint on a newspaper in U.S. history — and I had given another copy to The Post (which would also be enjoined), I went underground with my wife, Patricia, for 13 days. My purpose (quite like Snowden’s in flying to Hong Kong) was to elude surveillance while I was arranging — with the crucial help of a number of others, still unknown to the FBI — to distribute the Pentagon Papers sequentially to 17 other newspapers, in the face of two more injunctions. The last three days of that period was in defiance of an arrest order: I was, like Snowden now, a “fugitive from justice.”

Yet when I surrendered to arrest in Boston, having given out my last copies of the papers the night before, I was released on personal recognizance bond the same day. Later, when my charges were increased from the original three counts to 12, carrying a possible 115-year sentence, my bond was increased to $50,000. But for the whole two years I was under indictment, I was free to speak to the media and at rallies and public lectures. I was, after all, part of a movement against an ongoing war. Helping to end that war was my preeminent concern. I couldn’t have done that abroad, and leaving the country never entered my mind.

There is no chance that experience could be reproduced today, let alone that a trial could be terminated by the revelation of White House actions against a defendant that were clearly criminal in Richard Nixon’s era — and figured in his resignation in the face of impeachment — but are today all regarded as legal (including an attempt to “incapacitate me totally”).

I hope Snowden’s revelations will spark a movement to rescue our democracy, but he could not be part of that movement had he stayed here. There is zero chance that he would be allowed out on bail if he returned now and close to no chance that, had he not left the country, he would have been granted bail. Instead, he would be in a prison cell like Bradley Manning, incommunicado.

He would almost certainly be confined in total isolation, even longer than the more than eight months Manning suffered during his three years of imprisonment before his trial began recently. The United Nations Special Rapporteur for Torture described Manning’s conditions as “cruel, inhuman and degrading.” (That realistic prospect, by itself, is grounds for most countries granting Snowden asylum, if they could withstand bullying and bribery from the United States.)

Snowden believes that he has done nothing wrong. I agree wholeheartedly. More than 40 years after my unauthorized disclosure of the Pentagon Papers, such leaks remain the lifeblood of a free press and our republic. One lesson of the Pentagon Papers and Snowden’s leaks is simple: secrecy corrupts, just as power corrupts.

In my case, my authorized access in the Pentagon and the Rand Corp. to top-secret documents — which became known as the Pentagon Papers after I disclosed them — taught me that Congress and the American people had been lied to by successive presidentsand dragged into a hopelessly stalemated war that was illegitimate from the start.

Snowden’s dismay came through access to even more highly classified documents — some of which he has now selected to make public — originating in the National Security Agency (NSA). He found that he was working for a surveillance organization whose all-consuming intent, he told the Guardian’s Glenn Greenwald, was “on making every conversation and every form of behavior in the world known to them.”

It was, in effect, a global expansion of the Stasi, the Ministry for State Security in the Stalinist “German Democratic Republic,” whose goal was “to know everything.” But the cellphones, fiber-optic cables, personal computers and Internet traffic the NSA accesses did not exist in the Stasi’s heyday.

As Snowden told the Guardian, “This country is worth dying for.” And, if necessary, going to prison for — for life.

But Snowden’s contribution to the noble cause of restoring the First, Fourth and Fifth amendments to the Constitution is in his documents. It depends in no way on his reputation or estimates of his character or motives — still less, on his presence in a courtroom arguing the current charges, or his living the rest of his life in prison. Nothing worthwhile would be served, in my opinion, by Snowden voluntarily surrendering to U.S. authorities given the current state of the law.

I hope that he finds a haven, as safe as possible from kidnapping or assassination by U.S. Special Operations forces, preferably where he can speak freely.

What he has given us is our best chance — if we respond to his information and his challenge — to rescue ourselves from out-of-control surveillance that shifts all practical power to the executive branch and its intelligence agencies: a United Stasi of America.

Read more on this topic —- Eugene Robinson: We can handle the truth on NSA spying.

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THAT WAS OUR ORIGINAL JULY 4th posting:

The British Guardian – an American Media — on the run-up to July 4-th, 2013.

By Dan Gillmore

How Did American Become So Fearful and Timid That We’ve Given Away Essential Liberties? Some Are Even Afraid to Speak up
America’s founders would be horrified at this United States of Surveillance

July 2, 2013

I’m a longtime subscriber to an Internet mail list that features items from smart, thoughtful people. The list editor forwards items he personally finds interesting, often related to technology and/or civil liberties. Not long after the Guardian and Washington Post first started publishing the leaks describing the National Security Agency’s vast surveillance-dragnet, an item appeared about a White House petition urging President Obama to pardon Edward Snowden. The post brought this reply, among others:

“Once upon a time I would have signed a White House petition to this administration with no qualms. Now, however, a chilling thought occurs: what ‘watch lists’ will signing a petition like this put me on? NSA? IRS? It’s not a paranoid question anymore, in the United States of Surveillance.”

As we Americans watch our parades and fire up our grills this 4 July, the 237th anniversary of the Declaration of Independence – the seminal document of the United States – we should take the time to ask ourselves some related questions: how did we come to this state of mind and behavior? How did we become so fearful and timid that we’ve given away essential liberties? Do we realize what we’re giving up? What would the nation’s founders think of us?

No one with common sense believes Obama is planning to become a dictator. But the mail list question was indeed not paranoid – because Obama, building on the initiatives of his immediate predecessors, has helped create the foundation for a future police state. This has happened with bipartisan support from patriotic but short-sighted members of Congress and, sad to say, the general public.

The American media have played an essential role. For decades, newspaper editors and television programmers, especially local ones, have chased readers and ratings by spewing panic-inducing “journalism” and entertainment that helped foster support for anti-liberty policies. Ignorance, sometimes willful, has long been part of the media equation. Journalists have consistently highlighted the sensational. They’ve ignored statistical realities to hype anecdotal – and extremely rare – events that invite us to worry about vanishingly tiny risks and while shrugging off vastly more likely ones. And then, confronted with evidence of a war on journalism by the people running our government, powerful journalists suggest that their peers – no, their betters – who had the guts to expose government crimes are criminals. Do they have a clue why the First Amendment is all about? Do they fathom the meaning of liberty?

The founders, for all their dramatic flaws, knew what liberty meant. They created a system of power-sharing and competition, knowing that investing too much authority in any institution was an invitation to despotism. Above all, they knew that liberty doesn’t just imply taking risks; it absolutely requires taking risks. Among other protections, the Bill of Rights enshrined an unruly but vital free press and guaranteed that some criminals would escape punishment in order to protect the rest of us from too much government power. How many of those first 10 amendments would be approved by Congress and the states today? Depressingly few, one suspects. We’re afraid.

America has gone through spasms of liberty-crushing policies before, almost always amid real or perceived national emergencies. We’ve come out of them, to one degree or another, with the recognition that we had a Constitution worth protecting and defending, to paraphrase the oath federal office holders take but have so casually ignored in recent years.

What’s different this time is the surveillance infrastructure, plus the countless crimes our lawmakers have invented in federal and state codes. As many people have noted, we can all be charged with something if government wants to find something – the Justice Department under Bush and Obama has insisted that simply violating an online terms of service is a felony, for example. And now that our communications are being recorded and stored (you should take that for granted, despite weaselly government denials), those somethings will be available to people looking for them if they decide you are a nuisance. That is the foundation for tyranny, maybe not in the immediate future but, unless we find a way to turn back, someday soon enough.

You may believe there’s no possibility of America turning into a thugocracy, that the amassed information – conversations, business dealings, personal health and financial data, media consumption, gun records and so much more – will never be systematically misused that way. But even if you do, ask yourself this: if a young employee of one of the countless private companies administering the surveillance state could get access to so much for idealistic reasons, how vulnerable is this material to people with baser motives? Do you suppose corporate spies or foreign security services might be able to tempt some of the holders of this information with money, or find others who are vulnerable to blackmail? We’re creating the ultimate treasure chest of information, and it’s value is nearly limitless.

America’s founders would be horrified at what we’ve done, and what we’ve become. They would have denounced our secret laws, Kafka-esque “no fly lists” and so many other recent creations of power-grabbing presidents emboldened by feeble lawmakers and compliant courts. While they wouldn’t have understood the modern concept of privacy – though they’ve have wanted to protect it once they did understand – they would have engineered checks and balances to prevent today’s wholesale abuses, made so much worse by active corporate participation, reluctant or not, in the digital dragnets.

I live in California. My senior US senator, Dianne Feinstein, is a former prosecutor and acts like it. In her no doubt sincere desire to protect Americans from harm, she has been a consistent Democratic enabler of untrammeled presidential and law-enforcement powers. She calls Edward Snowden, a whistleblower who unquestionably broke the law, a traitor. But he pulled back the curtain on an increasingly lawless surveillance state. She has helped shred the Bill of Rights. Who, in the end, will have done more to “preserve and protect the Constitution”? For me, that’s an easy call.

Will we confront what’s happening and move now to change our trajectory? There are glimmerings of rationality amid the fear-mongering, including the public’s growing understanding – despite politicans’ foot-dragging and the media’s longstanding refusal to do its job on this issue, like so many others – that the war on (some) drugs has been an international catastrophe and, at home, a useful tool for those who’d curb liberty.

Obama says he wants to have a “conversation” about surveillance, even though his administration works mightily to keep so much of its workings – on these and other matters – secret from the American public, Congress and the judiciary other than opaque, rubber-stamp courts. What we really need is a larger conversation about state power and the actual risks we face, with context and clarity. In the process we need to confront the people who amass power and profits by fueling the ever-expanding, increasingly militarized surveillance state, and insist that they explain and justify what they’re doing. Their “trust us” nostrums are hollow.

I don’t know what the American public will conclude if we ever have that conversation. I would do whatever I could to help everyone understand that a surveillance society is profoundly un-American. I implore journalists to be part of the truth-telling, to take a stand for the Bill of Rights by doing their jobs as the founders intended. If we’re to preserve the risk-filled but noble American experiment of trusting people with liberty, we’d all best get started.

I’m proudly American, in large part because we’ve so often faced hard facts and ultimately, if belatedly, done what’s right. I have faith that the American people want the unadorned truth and will think through what’s at stake this time – and that they’ll take to heart Benjamin Franklin’s eternally wise admonition: “Those who would give up essential liberty, to purchase a little temporary safety, deserve neither liberty nor safety.”

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AND THE INTERNATIONAL ANGLE:

New Rumor of Snowden Flight Raises Tensions.
By RICK GLADSTONE and WILLIAM NEUMAN
Published by The New York Tines: July 2, 2013

It began as a seemingly offhand remark by the president of Bolivia, who suggested during a visit to Moscow that he might be happy to host Edward J. Snowden, the fugitive former security contractor who is desperate to find asylum. It escalated into a major diplomatic scramble in which the Bolivian president’s plane was rerouted on Tuesday, apparently because of suspicions that Mr. Snowden was aboard.

Evo Morales, president of Bolivia, was attending an energy conference in Moscow when he was asked in an interview if he would consider giving asylum to Edward J. Snowden.

Related

*
Snowden Is Said to Claim U.S. Is Blocking Asylum Bids (July 2, 2013)
*
Outrage in Europe Grows Over Spying Disclosures (July 2, 2013)
*
India Ink: India Denies Asylum to Snowden (July 2, 2013)

By day’s end, outraged Bolivian officials, insisting that Mr. Snowden was not on the plane, were accusing France and Portugal of acting under American pressure to rescind permission for President Evo Morales’s plane to traverse their airspace on the way back to Bolivia. Low on fuel, the plane’s crew won permission to land in Vienna.

“They say it was due to technical issues, but after getting explanations from some authorities we found that there appeared to be some unfounded suspicions that Mr. Snowden was on the plane,” the Bolivian foreign minister, David Choquehuanca, told reporters after the plane touched down in Vienna, where Mr. Morales was spending the night.

“We don’t know who invented this big lie,” the foreign minister said at a news conference in La Paz, Bolivia. “We want to express our displeasure because this has put the president’s life at risk.”

Rubén Saavedra, the defense minister, who was on the plane with Mr. Morales, accused the Obama administration of being behind the action by France and Portugal, calling it “an attitude of sabotage and a plot by the government of the United States.”

There was no immediate response by officials in Paris, Lisbon or Washington.

“We were in flight; it was completely unexpected,” Mr. Saavedra said on the Telesur cable network. “The president was very angry.”

Speaking by phone with Telesur, Mr. Saavedra said that Mr. Snowden was not on the plane. Later, Reuters cited an unidentified Austrian Foreign Ministry official as saying the same thing.

Bolivian officials said they were working on a new flight plan to allow Mr. Morales to fly home. But in a possible sign of further suspicion about the passenger manifest, Mr. Saavedra said that Italy had also refused to give permission for the plane to fly over its airspace. Later he said that France and Portugal had reversed course and offered to allow the plane to fly through their airspace after all.

On Monday, Mr. Morales, who was attending an energy conference in Moscow, was asked in an interview on the Russia Today television network if he would consider giving asylum to Mr. Snowden, 30, who has been holed up at Moscow’s Sheremetyevo Airport for more than a week, his passport revoked by the United States.

“Yes, why not?” Mr. Morales responded. “Of course, Bolivia is ready to take in people who denounce — I don’t know if this is espionage or monitoring. We are here.”

He said, though, that Bolivia had not received a request from Mr. Snowden, despite news reports to the contrary.

It was already clear by then that the Moscow conference had been overshadowed by the drama of Mr. Snowden and his disclosures about American intelligence programs, which have deeply embarrassed the Obama administration.

President Nicolás Maduro of Venezuela, who was also at the conference, had suggested he might offer Mr. Snowden asylum but did not plan to fly him to Venezuela.

But Mr. Morales’s remarks appeared to open the door. At least that was the way they were interpreted.

The problems began even before Mr. Morales left Moscow, Mr. Choquehuanca said. On Monday, Portugal, without explanation, had withdrawn permission for Mr. Morales’s plane to stop in Lisbon to refuel, the foreign minister said. That required Bolivian officials to get permission from Spain to refuel in the Canary Islands.

The next day, after taking off from Moscow, Mr. Morales’s plane was just minutes from entering French airspace, according to Mr. Saavedra, when the French authorities informed the pilot that the plane could not fly over France.

There was also plenty of confusion in Moscow over how Mr. Snowden could possibly have left undetected on a government aircraft.

Government planes carrying foreign officials to diplomatic meetings in Moscow typically arrive and depart from Vnukovo Airport, which is also the main airfield used by the Russian government, rather than from Sheremetyevo, where Mr. Snowden arrived from Hong Kong on June 23 hours after American officials had sought his extradition there.

The speculation that Mr. Snowden would hitch a ride on a government jet was discounted by the fact that the plane would have to first make a quick flight from one Moscow airport to the other.

In an interview with the television station Russia Today, Mr. Maduro said he would consider any request by Mr. Snowden. Then, ending the interview with a dash of humor, he said, “It’s time for me to go; Snowden is waiting for me.”

Rick Gladstone reported from New York, and William Neuman from Caracas, Venezuela. David M. Herszenhorn and Andrew Roth contributed reporting from Moscow, and Monica Machicao from La Paz, Bolivia.

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Posted on Sustainabilitank.info on July 5th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

Venezuela’s Independence Day

Press Statement
John Kerry
Secretary of State
Washington, DC
July 3, 2013

On behalf of President Obama and the people of the United States, I congratulate the people of Venezuela as you commemorate the day that Venezuela declared its independence 202 years ago.

Venezuela and the United States have much in common. For example, revolutionary leader General Francisco de Miranda also played a part in our own struggle for independence, participating in the Battle of Pensacola in 1781. His contribution is forever memorialized in a monument that stands in the heart of Philadelphia, the original capital of the United States. When a devastating earthquake struck Venezuela in 1812 the United States sent the Venezuelan people the first humanitarian assistance it ever provided to a foreign country. These two examples demonstrate that Venezuela and the United States have shared ties of friendship and common values since the birth of our two nations, and the ties between our people endure.

I wish Venezuelans everywhere health, happiness, and hope on the anniversary of your independence.

——————————–

The Washington Post of July 5, 2013 tells us:

““As head of state, the government of the Bolivarian Republic of Venezuela decided to offer humanitarian asylum to the young American Edward Snowden so that he can live in the homeland” of independence leader Simon Bolivar and the late President Hugo Chavez without “persecution from the empire,” Maduro said, referring to the United States.

He made the offer during a speech marking the anniversary of Venezuela’s independence. It was not immediately clear if there were any conditions to Venezuela’s offer.

Maduro added that several other Latin American governments have also expressed their intention of taking a similar stance by offering asylum for the cause of “dignity.”

In Nicaragua, Ortega said he was willing to make the same offer “if circumstances allow it.” Ortega didn’t say what the right circumstances would be when he spoke during a speech in Managua.

He said the Nicaraguan embassy in Moscow received Snowden’s application for asylum and that it is studying the request.

“We have the sovereign right to help a person who felt remorse after finding out how the United States was using technology to spy on the whole world, and especially its European allies,” Ortega said.

The offers came following a flap about the rerouting of Bolivian President Evo Morales’ plane in Europe earlier this week amid reports that Snowden might have been aboard.

Spain on Friday said it had been warned along with other European countries that Snowden, a former U.S. intelligence worker, was aboard the Bolivian presidential plane, an acknowledgement that the manhunt for the fugitive leaker had something to do with the plane’s unexpected diversion to Austria.

It is unclear whether the United States, which has told its European allies that it wants Snowden back, warned Madrid about the Bolivian president’s plane. U.S. officials will not detail their conversations with European countries, except to say that they have stated the U.S.’s general position that it wants Snowden back.

Maduro joined other leftist South American presidents Thursday in Cochabamba, Bolivia, to rally behind Morales and denounce the rerouting incident.

President Barack Obama has publicly displayed a relaxed attitude toward Snowden’s movements, saying last month that he wouldn’t be “scrambling jets to get a 29-year-old hacker.”

But the drama surrounding the flight of Morales, whose plane was abruptly rerouted to Vienna after apparently being denied permission to fly over France, suggests that pressure is being applied behind the scenes.

Spanish Foreign Minister Jose Manuel Garcia-Margallo told Spanish National Television that “they told us that the information was clear, that he was inside.”

He did not identify who “they” were and declined to say whether he had been in contact with the U.S. But he said that European countries’ decisions were based on the tip. France has since sent a letter of apology to the Bolivian government.”

———————————–

The bottom line is as reported by the Guardian:

“We are not colonies any more,” Uruguay’s president, Jose Mujica, said. “We deserve respect, and when one of our governments is insulted we feel the insult throughout Latin America.”

Ecuador’s president, Rafael Correa, said on Thursday he and other leaders were offering full support to Morales and called the rerouting of the plane an aggression against the Americas.

Cristina Fernandez of Argentina said Latin Americans treasured freedom after fighting for independence from Europe in the 19th century and then surviving Washington’s 20th-century history of backing repressive regimes in the Americas. She demanded an apology for the plane ordeal.

“I’m asking those who violated the law in calm but serious manner, to take responsibility for the errors made, it’s the least they can do,” Fernandez said. “To apologize for once in their life, to say they’re sorry for what they’ve done.”

Morales has said that while the plane was parked in Vienna, the Spanish ambassador to Austria arrived with two embassy personnel and they asked to search the plane. He said he denied them permission.

“Who takes the decision to attack the president of a South American nation?” Maduro asked. Spanish prime minister Mariano “Rajoy has been abusive by trying to search Morales’ plane in Spain. He has no right to breach international law.”

———————————–

It seems like time has come for a US face-saving diplomacy before true craters open up at US borders – East, West, and South.

We have previously outlined a draft that we did not publish – but think now that the airplane flap justifies a US Presidential pardon to Snowden – just to get the issue of the World table – the damage was done and no sense for the US to dig itself deeper into the hole it created.

———————————-

US senator from New Jersey, Robert Menendez, the Democratic chairman of the Senate Foreign Relations Committee, told little Ecuadoran that he would block the import of vegetables and flowers from Ecuador if Ecuador gives asylum to Edward Snowden. The cost to Ecuador would be one billion dollars in lost revenues. Will he also forbid trips from the US to the Galapagos?

Will he be consistent and close US imports of Venezuela oil? Of Latin oil in general?
Ecuador and Venezuela happen to be also members of OPEC which Bolivia is not. A policy of threats presents many interesting angles and possibilities.
Will there be ways to enlarge this with some reaction to what happens in Egypt, in Saudi Arabia, some more grand-standing anyone?

———————————-

Thursday the leaders of Venezuela, Ecuador, Argentina and Uruguay joined Bolivia’s President Morales in Cochabamba, for a special meeting to address the diplomatic row.

At the end of the summit a statement was issued demanding answers from France, Portugal, Italy and Spain. The United States was not mentioned in the statement.

“Europe broke all the rules of the game,” Venezuelan president Nicolas Maduro said shortly after arriving at Cochabamba airport. “We’re here to tell president Evo Morales that he can count on us. Whoever picks a fight with Bolivia, picks a fight with Venezuela.”

Maduro said an unnamed European government minister had told Venezuela the CIA was behind the incident.

“We are not colonies any more,” Uruguay’s president, Jose Mujica, said. “We deserve respect, and when one of our governments is insulted we feel the insult throughout Latin America.”

Ecuador’s president, Rafael Correa, said on Thursday he and other leaders were offering full support to Morales and called the rerouting of the plane an aggression against the Americas.

Cristina Fernandez of Argentina said Latin Americans treasured freedom after fighting for independence from Europe in the 19th century and then surviving Washington’s 20th-century history of backing repressive regimes in the Americas. She demanded an apology for the plane ordeal.

“I’m asking those who violated the law in calm but serious manner, to take responsibility for the errors made, it’s the least they can do,” Fernandez said. “To apologise for once in their life, to say they’re sorry for what they’ve done.”

Morales has said that while the plane was parked in Vienna, the Spanish ambassador to Austria arrived with two embassy personnel and they asked to search the plane. He said he denied them permission.

“Who takes the decision to attack the president of a South American nation?” Maduro asked. Spanish prime minister Mariano “Rajoy has been abusive by trying to search Morales’ plane in Spain. He has no right to breach international law.”

Before the meeting, Morales said his ordeal was part of a US plot to intimidate him and other Latin American leaders.

He urged European nations to “free themselves” from the United States. “The United States is using its agent [Snowden] and the president [of Bolivia] to intimidate the whole region,” he said.

France sent an apology to the Bolivian government. But Morales said “apologies are not enough because the stance is that international treaties must be respected”.

Spain’s foreign affairs minister, Jose Manuel Garcia-Margallo, said his country did not bar Morales from landing in its territory.

Amid the tensions, the US embassy in La Paz cancelled Independence Day celebrations scheduled for Thursday. In the eastern city of Santa Cruz, Bolivian government sympathisers painted protest slogans on the doors of the American consulate.

Bolivia has said it will summon the French and Italian ambassadors and the Portuguese consul to demand explanations.

Brazil was represented by Marco Aurelio Garcia, President Dilma Rousseff’s top international adviser. The presidents of Colombia, Chile and Peru, who have strong ties to the US, were not attending.

Colombia’s president, Juan Manuel Santos, said earlier on Thursday he supported Morales, but asked other leaders to remain cool and avoid an escalating dispute between Latin America and the European Union.

“We’re in solidarity with Evo Morales because what they did to him is unheard-of, but let’s not let this turn into a diplomatic crisis for Latin America and the EU,” Santos tweeted on Thursday.

—————————————

Our draft started: Thanks to the Egyptian military – their intervention got off the media front line the Snowden, Assage, Manning, WikiLeaks Warning Lighthouses – and replaced them with a renewed attention to the Islamic potential for acts of terror.

Furthermore – Latin America seems split between the go it alone States of the ALBA group – Bolivia, Cuba, Ecuador, Venezuela, their new friends – Argentina, Brazil, Uruguay, and now Nicaragua – and their opponents – the strong US connected, Chile, Colombia, Peru and the Southern European States Italy, France, Spain, Portugal that acted out on unsightly pressure from the White House, and perhaps even Austria – if it turns out to be true that they searched the Bolivian President’s plane. What about Mexico? Will they want to be seen as residing in the US vest-pocket?

Today it seems that just the Greens, the so called Pirates, and some other non-political fringe parties, are left in Europe to stand up for Democracy – The Reds, Blacks, Blues, Yellow, Orange, and Purple – all established political parties – have abandoned the Democracy ship because of the Transatlantic breeze from the Potomac. Europe seems anew like the Europe of the thirties with governments worried about their business-ties. Any infringements of democratic inalienable rights are not noted now, like they were not noted then. But this is totally misleading – just read the Guardian where all these stories started. This at a time the voters in quite a few European States do take position on this – and we would not be surprised if Austria as well took back its “Neutral Mantle” to declare that they too are ready to give refuge to Snowden. The coming days will tell.

————————————–

And as if nothing happened – a US hand to the people of Argentina as if they have now no elected government?:

Western Hemisphere: Argentina’s Independence Day

07/05/2013 02:31 PM EDT

Argentina’s Independence Day

Press Statement
John Kerry
Secretary of State
Washington, DC
July 5, 2013

On behalf of President Obama and the American people, I send best wishes to the people of Argentina as they celebrate their Independence Day this July 9.

The citizens of our two nations have a long history of productive and friendly relations, highlighted by educational and cultural exchanges and fruitful collaboration in the fields of science, technology, health, space, and energy.

The determination expressed by the patriots gathered at the Casa de Tucuman, to forge a free and independent nation, is a fundamental human longing, and one we share.

On this day, the United States wishes Argentina a happy celebration.

We look forward to working together to cultivate a strong bilateral relationship in the years to come.

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Posted on Sustainabilitank.info on June 2nd, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

 

 

 

 

Are We Witnessing the Long-Awaited Turnaround in EU Economic Policy?

 

 

On May 29, the EU Commission (as well as OECD) published its assessment of the budgetary and reform programs of its member states and issued its “country-specific recommendations”  – with the exception of Portugal, Greece and Cyprus which had already received their “adjustment programs” earlier.

Media reporting focused on the extension (by 2 years) of the time by which some countries have to achieve their medium-term objectives, and on President Hollande’s rebuke of the EC’s recommendations for France.

Commission President Barroso spoke of the need to loosen the consolidation efforts and to start combating unemployment, especially for youths. 6 bill EUR should be available for this purpose. Suddenly, promoting growth is no longer a taboo. The recent Franco-German announcement of an impending
“gouvernement economique” or “verstärkter Koordinierungsmechanismus”
also give some hope.

 

Still, Barroso (and the EC) thinks that ”structural reforms” in goods and labor markets are the key to growth, and thus need to be speeded up. His (marginal) slowing down of austerity is not based on the recognition that the EU crisis strategy has proven to be a complete failure, but “only” on the lack of political acceptance by the unemployed citizens of the EU.
A turnaround in policy, a necessary change in the policy paradigm, this is not.

 

It seems to be impossible for politicians, both national and supranational ones, to admit past mistakes. But this would be the pre-requirement for a turnaround. Barroso and the others act as if everything so far had been going according to plan, had been successful, and that now one just adds another element to the heretofor successful strategy. This behavior, repression of facts, has been analyzed extensively by my late compatriot Sigmund Freud.
It prevents new insights from coming onto the radar screen, a requirement for a new direction.

 

Technically, the EC assessed the Stability Programs and the Reform Programs. In its own words, by assessing them jointly, the EC purports to assess the complete economic policy of its member states. Let us look at the Austrian assessment as a case in point.

 

Economic growth is mentioned only with respect to the Austrian forecasts which underlie the programs – which are seen as being too optimistic. The prime objective of the analysis is, as usual, the positively assessed path of budget consolidation. The medium-term objective (as structural deficit of 0.45% of GDP) should be achieved 2 years earlier than originally (2017) planned. But Austria’s public expenditure share path again is seen as too optimistic. With respect to the tax system, the EC tells the Austrians that the least growth-damaging real estate taxes are far below the EU average, and thus could be increased.

 

The most important points of criticism concern the labor market: the participation rates of females and seniors are by far too low, income differences between genders too high, the pension age for women creeps only marginally towards that of men, early retirement is still to prevalent; education achievements are under par, at the same time costs of the system too high, migrants are left behind. All this against the background of the recognition that (measured) unemployment in Austria is the lowest in the EU. The EC criticizes also inadequacies in financial market supervision between home and host countries, as well as too many barriers for professional services and for personal services in health and care sectors.

 

For all these areas, EC gives recommendations to speed up reforms. All these points are well taken (by me, not necessarily the authorities), but: their implementation alone, while important, does not generate growth. There is not enough emphasis on promoting innovation, on real problems with the tertiary education system, no mentioning at all about a positive growth expectation – which would require an increase in effective demand in Europe. The structural problems of the financial sector are largely ignored, with the exception of the possible budgetary consequences of winding down one of the nationalized banks.

 

Macropolicy is not mentioned, not in the Austrian assessment, not in the assessment of the Eurozone. There EC mentions the need to achieve an adequate policy mix by better coordination of budget consolidation and structural policies, but no word is lost on coordination between the fiscal stance of the Eurozone and ECB’s monetary policy. This shows once more that macroeconomic policy is a foreign concept to the EC, that economic policy consists of budget policy cum supply side (micro) economics. Briefly, imbalances in foreign trade are mentioned, plus its necessary “rebalancing”, but that is it. When reading the documents, one sees that the focus on individual countries’ assessment virtually crowds out the assessment of the Eurozone and the EU as a whole. They are seen as the sum of the individual countries, but not as an objective of macroeconomic policy.

 

Conclusion: Nothing much has changed in the EU’s policy orientation. While the soaring youth unemployment is – finally – seen as a major (mainly political) problem, austerity is slowed down and youth training programs are encouraged. But this is not a change in the mainly austerity-driven paradigm. It does appear that the requirements of the financial markets still drive EU economic policy, rather than the life expectations of the EU citizens. The recent news about the watering-down and delay of the Financial Transactions Tax are only one indicator of this. The objective that the EU should pursue the welfare of its populations, enshrined in the Treaty, seems to have been forgotten.

======================================================================

Op-Ed Columnist – THE NEW YORK TIMES.

Prisoners of the Euro

TO its custodians and admirers, the European Union is the only force standing between its member states and the age-old perils of chauvinism, nationalism and war. That was the pointed message that the Nobel Committee sent last year, when it awarded the union a Peace Prize for its role in “the advancement of peace and reconciliation, democracy and human rights.” And it is the message hammered home relentlessly by the Continent’s politicians, who believe their citizens face a stark choice, in the words of Chancellor Angela Merkel of Germany, between continued integration and a return to “centuries of hatred and blood spill.”

But right now, the E.U. project isn’t advancing democracy, liberalism and human rights. Instead, it is subjecting its weaker member states to an extraordinary test of their resilience, and conducting an increasingly perverse experiment in seeing how much stress liberal norms can bear.

That stress takes the form of mass unemployment unseen in the history of modern Europe, and mass youth unemployment that is worse still. In the Continent’s sick-man economies, the jobless rate for those under 25 now staggers the imagination: over 40 percent in Italy, over 50 percent in Spain, and over 60 percent in Greece.

For these countries, the euro zone is now essentially an economic prison, with Germany as the jailer and the common currency as the bars. No matter what happens, they face a future of stagnation — as aging societies with expensive welfare states whose young people will sit idle for years, unable to find work, build capital or start families.

The question is whether they will face ideological upheaval as well. So far, the striking thing about the aftermath of the 2008 financial crisis, both in Europe and the United States, is how successfully the center has held. Power has passed back and forth between left and right, but truly radical movements have found little traction, and political violence has been mercifully rare.

In a sense, Francis Fukuyama’s post-cold-war declaration of the “end of history” — by which he meant the disappearance of credible alternatives to liberal democracy and mixed-economy capitalism — has held up pretty well in the last five years. Amid the worst economic disaster since the Great Depression, illiberal societies like Egypt and Syria have faced political crises, but the developed world has not. There has been no mass turn to fascism, no revival of Marxist economics, no coup d’états in Madrid or jackboots in Rome.

But you have to wonder whether the center can hold permanently, if unemployment remains so extraordinarily high. How must liberal democracy and mixed-economy capitalism look to young people in the south of Europe right now? How stable is a political and ideological settlement that requires the rising generation to go without jobs, homes and children because the European project supposedly depends on it? And for that matter, how well is the Continent’s difficult integration of Muslim immigrants likely to proceed in a world where neither natives nor immigrants can find work?

Already, the Greek electorate has been flirting with empowering a crypto-communist “coalition of the radical left,” even as a straightforwardly fascist party gains in the polls as well. Hungary’s conservative government has tiptoed toward authoritarianism. Spain has seen huge street protests whose organizers aspire to imitate the Arab Spring. And lately, Sweden, outside the euro zone but not immune to its youth unemployment problems, has been coping with unsettling, highly un-Scandinavian riots in immigrant neighborhoods.

These perturbations do not threaten democracy in Europe yet, and maybe they never will. Maybe the liberal democratic consensus is so bred into the bone that no amount of elite misgovernment can persuade Europe’s younger generation to turn against it. Maybe nothing can end the end of history.

But for the countries facing a youth unemployment crisis, that still seems like an awfully risky bet to make.

Yet there’s a Catch-22 facing Greeks and Spaniards and Italians looking for an alternative to just staying the course. As wrenching as it would be, the option that would do the most to defang extremists of the left and the right would probably be to abandon the euro immediately, with each country regaining control of its own fiscal and monetary policy and seeing what options open up. But at the moment, the only people arguing for that course are … the extremists of the left and the right!

For that to change, more of the Continent’s political elites would need to recognize that their beloved integration project may actually be threatening Europe’s long democratic peace. For now, there simply aren’t enough responsible people ready to unwind what should never have been knitted together in the first place. But with every increase in the unemployment rate, the odds get better that irresponsible and illiberal figures will end up unwinding it instead.

Readers’ Comments:   Read All Comments (15) »

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Posted on Sustainabilitank.info on May 13th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

A Festival of singing people – 440 of them – from 18 choirs – in 16 European Cities – May 9-12, 2013 – held with workshops at the reestablished historic Odeon Theater in Leopoldstadt – the previously mainly Jewish Second District of Vienna.

The Festival culminated in a public concert on Sunday May 12, 2013 at the Austria Center back-to-back with the offices of the Vienna UN compound. The Honorary Chairman of the event was Austria’s President – the Honorable Heinz Fischer.

This after the 2011 revival of the European States Makkabi sports-competitions that brought at the time 60,000 out-of-town visitors to Vienna.

The present event was dedicated to the revival of Jewish culture in European Communities – and at times the choirs including non-Jews as well.

The timing seems symbolical – it started May 9th – the Victory Day over Nazism and ended on Mothers’ Day – if you wish in memory of those Jewish self sacrificing mothers that helped continue Judaism in Europe that proving that Hitler was defeated.

At the workshops the choirs were taught new songs that were then performed jointly by all participants at the grand-finale of the Sunday event. These included Adon Olam with the Chief cantor of Vienna’s Jewish Community Shmuel Barzilay, Ose Shalom, and the israeli National anthem – The Hatikah (Hope).

The professional leader of the event was Choirmaster Roman Grinberg of the Vienna Jewish Choir whose President is a Young man Florian Pollack who was the organizer of the Sunday concert. Though performing also liturgical music, this choir is cultural in content – including both men and women, something that might have been difficult to do if it were directly part of the Orthodox stream of the majority of Vienna Synagogues – though quite normal with the Or Chadash Reform Vienna Synagogue. Nevertheless the Orthodox Chief Rabbi of Austria, Rabbi Chaim Eisenberg, who himself has in the past performed with the Vienna Jewish Choir outside the Synagogue, wrote an introductory note to the Sunday program booklet.

The MC on Sunday was Ms. Danielle Spera who is a well known Austrian TV personality, and in 2010 became the Director of the Vienna Jewish Museum. She was the top choice of Vice Mayor Renate Brauner, who is in charge of the Vienna Holding Company that owns the buildings of the two Vienna Jewish Museums that were up for renovation in the 2010-2011 years.

The meeting of the choirs cost 200.000 Euro and the money came from institutional contributions. The main backer was the Bruxells based European Jewish Union that was described by the MC as The Jewish European Parliament.

At the workshops, the nine choirs that belong to the Renanim organization – choirs from Amsterdam, Bruxelles, Dijon, Marseille, Nantes, Nice, Paris, Toulouse, and Utrecht chose to appear in a large united choir – thus reducing the number of choirs on Sunday from 18 to 10 facilitating a more manageable situation.

The Sunday event started with one choir on stage and all the others in various locations in the hall – singing together Uru Ahim- Hava Neranna. . .  with an added 1400 people in the large and full hall of the Austria Center (In the audience I spotted also several women with Muslim head-covers). Then, after the introductory, thankfully rather short  speeches, the line-up was thus as follows:

1. The Vienna Jewish Choir led by Roman Grinberg that was created 20 years ago by Dr. Timothy Smolka with 8 people and counts now on 50 active singers having performed at many events all over Europe. Their contribution was mainly in Jidish – old folk-songs.

2. The Assoziazione Coro-Kol of Rome led by Choirmaster Andrea Orlando that started with Verdi’s Va Pensiero and moved to Hebrew Shabbat and wedding songs. This choir was established in 1993 by the Great Synagogue of Rome and has usually a repertory that includes Ladino as well as Yiddish songs.

3. The Masel Tov Choir of Wuppertal, Germany with Rokella Rachel Verenina, formerly of Odessa, the Ukraine, as choirmaster.It is a choir established 15 years ago by Russian immigrants that finally wanted to express themselves freely. It has now 35 active members – Jews and non-Jews and is one of the best in Germany. They sang Yiddish and German. In the choir I spotted also one black man and many of the singers looked like hardened industrial workers – what they probably are indeed.

4. The Boys Choir of The Vienna City Tempel – the Main Synagogue of Austria Shmuel Barzilai, the Chief Cantor in charge. It had 7 boys under the age 13. This Choir is modeled after the famous Vienna Boys Choir. Their songs were all in Hebrew and from the liturgy and were received with warm applause.

5. The Shalom Chor of Berlin led by Nikola David who is an operatic singer who after graduating from cantorial school has now a position with the Erfurt Synagogue. The 37 active members are from the community and from churches around Berlin. They sang in Hebrew and interestingly wore shawls of single colors – red, green, orange, blue, light green – which left me with the impression that they covered the political spectrum of Germany. I wonder if this was indeed the intent of these colors.

6. The Ensemble Vocal Zamir of Paris with Albert Benzaquen as choirmaster ranging in music from Shlomo Carlebach and Naomi Shemer to Chasidic and Ladino. It was created in 1980 from basically members of families from the Sephardic community. They have had many appearances in France and do not miss the choir festival in Israel – the Zimrya in Jerusalem. Working people – they clearly enjoy what they are doing and we were told meet twice a week.

7. The Jewish Choir “Eva” of Saint Petersburg with Elena Rubinovich as choirmaster. An all girls choir. The teen-age girls dressed in white blouses and blue long skirts. They had a large Magen David attached to their blouses above the heart. They started with Jerusalem of Gold in Hebrew, had a Russian song and moved to Yidddish – “Bei Mir Bistu Shein” the Jewish American song. Interesting – this was different then in the written program and clearly they have a large repertory and were excellent – real singing talent – lurks here. We were told that the girls are children and youth organized by the Welfare and Community Centre. Terrific applause.

8. The Varnishkes of Lviv, The Ukraine with Oleksandra Somysh as Band leader of what was indeed a Klezmer-music group.  Another example of terrific applause. The team was born 6 years ago and as they state it – they adore the magic of Yiddishkeit. They include volunteers and foreign students and are lovely. They reminded me of a similar non-Jewish group I saw in Cracow years ago and Elie Wiesel was in the audience then.
The Lviv group – the singing was all in Yiddish – and we understand that young German audiences love to listen to them.

9. Hor Bracha Baruh a Choir named after the Baruch Brothers of Belgrade. This choir is not by definition Jewish – but it was named after three brothers that were killed fighting in the resistance in WWII, and the choir comes to honor their Jewish culture. The choir was founded in 1879 as the Serbian Jewish Singing Society – perhaps the oldest Jewish choir in the world – then re-established under the present name when Yugoslavia split and the Serbs clearly were looking for Israeli recognition mentioning that it was Serbs that were most friendly in those terrible war-years.Their repertory is eclectic – included Serbian, Ladino and Hebrew and sounded well rehearsed. It is a nostalgic but hope-filled experience. The Choirmaster Stefan Zekic – a clear professional.

10. The Renanim combine with Avner Soudry as choirmaster and Therese Beuret-Sadoul as Administrator that gave us a Paul Ben Haim Hebrew composition, a Suite Judeo-Espagnole and a very appropriate Shir LaShalom, then Mipi El. They remained on stage and were joined by everyone else for the Grand Finale.

There were obviously no encores – but everyone, afyer milling around for a while, happily called it a night.

 

###

Posted on Sustainabilitank.info on April 4th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

The following is a presentation of facts that cannot be ignored anymore. Deserves close reading by those in the North that thought you can bumble your way through without creating a real union capable of calling out “it is all for one and not just one for all!” The EU is not just the fulfilling of the German dream of takeover of Europe by peaceful means. Cyprus dreaming of being the Mediterranean base of Russia? What else? Austria a bridge to the East? Yes, but only after twinning up with Finland.
The article does not mention the UK even once – we interpret this as a sign it has crystallized as the island off-shore that ought to partner with the US and stop bothering the decision making process of the continent at large.
It was the UK interest that created Cyprus in the first place by not letting it split and join Greece and Turkey. Who needed two weak Greek States in the Union? Malta? another UK invention? Slovenia was good – why not also a Catalunya or Catalonia?

————————————–

english banner othernews

A Line Of Demarcation Through The Eurozone Is Taking Shape

 
 
Wolf Richter*  

Everyone learned a lesson from the “bail-in” of the Cypriot banks: Russian account holders who’d laundered and stored their money on the sunny island; bank bondholders who’d thought they’d always get bailed out; Cypriot politicians whose names showed up on lists of loans that had been extended by the Bank of Cyprus and Laiki Bank but were then forgiven and written off. Even brand-new Finance Minister Michael Sarris who got axed because he’d been chairman of Laiki when this was going on. His lesson: when a cesspool of corruption blows up, no one is safe. And German politicians learned a lesson too: that it worked!

“With the Cyprus aid package, it was proven that countries like Germany, the Netherlands, and Finland, if they stick together, are able to push for a strict stability course,” Hans Michelbach told the Handelsblatt. The chairman of the finance committee in the German Parliament and member of the CSU, Chancellor Angela Merkel’s coalition partner, called for deeper collaboration of the triple-A countries in the Eurozone “to strengthen the confidence of citizens and investors in the common currency.”

There are still five in that euro triple-A club: Germany, Austria, the Netherlands, Finland, and Luxembourg. “It would be good if we could also convince Luxembourg to participate more strongly in this stability collaboration,” he said. It would be in the best interest of Luxembourg as major financial center, he added. A reference to Luxembourg’s precarious status, as Cyprus had learned, of being a tiny country with banks so large that it can’t bail them out by itself.

To protect the euro, the alliance of the triple-A countries must be united firmly against large euro countries like Italy and France, he said. “Strong signals of stability would be of great importance for the Eurozone,” particularly now, given the “unclear situation” in Italy, renewed doubts about Greece, and the failure of the French government in its stability policies.

Exactly what French President François Hollande needs: the euro triple-A club breathing down his neck. He’s already in trouble at home. To reverse the slide, he got on state-owned France 2 TV last Thursday to speak to the French people so that they could see how his sincerity, wisdom, and economic policies would stop the country from sinking ever deeper into a quagmire.

And a quagmire it is: double-digit unemployment, a Purchasing Managers Index just above Greece’s, new vehicle sales that plunged almost 15% so far this year, a budget deficit that refuses to be brought under control…. He has tweaked some policy measures here and there. And he dug up a new version of the 75% income-tax bracket that had been squashed by the Constitutional Court. But Jérôme Cahuzac, the Budget Minister who’d tried to get the first version through the system, went up in flames over allegations of tax fraud and “tax fraud laundering.”

Now the people have had it. After the TV appearance, his approval rating, ten months into his term, plummeted another 6 points to 31%, a low that scandal-plagued Nicolas Sarkozy took four years to reach. And only 27% approved of his economic policies. “The French simply don’t want austerity,” lamented an unnamed government insider.

France was suffering the consequences of the “socialist experiments” of its government and was becoming less and less competitive, explained Michelbach. He emphasized that France would remain an important partner of Germany. He wasn’t kidding: France buys 10% of Germany’s exports and is crucial to the German economy. But if France didn’t change course, he said, that could become a “serious problem” for the Eurozone.

As opposed to the mere hiccups of Cyprus or Greece. More banks and more countries will require bailouts­Slovenia, Spain, Italy, and Malta are on the list. And no one wants to see France on that list. Even Italy is too large to get bailed out by other countries­though it’s rich enough to bail itself out, à la Cyprus [ A "Politically Explosive" Secret: Italians Are Over Twice As Wealthy As Germans].

But in Germany, a revolt against these save-the-euro bailouts has been brewing for a while. With elections in September, it’s taking on volume and voices, and the structure of a political party, the Alternative for Germany, not unpalatable radicals but the educated bourgeoisie, and they want to stop the bailouts and dump the euro.

The government is feeling the heat. No one can afford to lose votes. Michelbach’s triple-A club, a line of demarcation in the Eurozone, is one of the reactions. Merkel might benefit from it in the elections. The other four countries might find if appealing, though it will be of dubious appeal in the rest of the Eurozone. But if efforts fail to fix the Eurozone’s problems­and the Eurozone lumbering that way­a tightly knit triple-A club could weather the storm together, more stable and more unified than the Eurozone ever was. And Michelbach had just floated a version of that idea.

Every country in the Eurozone has its own collection of big fat lies that politicians and Eurocrats have served up in order to make the euro and the subsequent bailouts or austerity measures less unappetizing. Here are some from the German point of view…. Ten Big Fat Lies To Keep The Euro Dream Alive

———————————————————————————–
    *    www.testosteronepit.com    www.amazon.com/author/wolfrichter
 twitter.com/TestosteronePit

Wolf Richter wrote also – “White House Hypocrisy And Trade Sanctions Against China.” -  Practically every car sold in the US contains Chinese-made components. But suddenly, in the middle of a heated presidential campaign, the Obama administration decided to do something about it.

Wolf Richter is a  San Francisco based executive, entrepreneur, start up specialist, and author, with extensive international work experience.

In www.nakedcapitalism.com/2013/03/w… he explains “Having worked a bit on international deals, and for companies operating in foreign markets, cross border transactions have an even lower success rate than domestic ones. The big reason is the one mentioned here, which is marked cultural incompatibility between the seller and buyer. Here the Chinese did less badly than they could have (they could have tried forcing Chinese practices on the German operation, which would have destroyed the value of the asset). But the logic of the transaction was unclear. Was it technology transfer? Consolidation? It appears both might have been goals, and neither happened very much.

But I find it intriguing that as lousy as the Japanese were at doing deals  (they found it hard to understand that the contract was the deal, and were too inclined to overpay), they were good at managing workers in manufacturing operations (service businesses were another kettle of fish, there they tended to drive Americans crazy).  This is a skill the Chinese will have to master, since they desperately need to re-invest their surpluses, and they are trying to acquire more real-economy assets.”    FASCINATING.

His insights in Wall Street machinations are also very good.

 

 

###

Posted on Sustainabilitank.info on March 30th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

THIS COULD BE ABOUT SUSTAINABILITY.  SustainabiliTank.info editor}

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Posted on Sustainabilitank.info on March 16th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

from:  Stefania Massari <stefania.massari@unisalento.it>
reply-to:  Stefania Massari <stefania.massari@unisalento.it>

 

The University of Salento (Lecce-Italy) announces the second edition of
the International Summer School “Life-Cycle Approaches to Sustainable
Regional Development”, which will take place in Santa Maria di Leuca (LE)
from July 8th to July 12th 2013.
The focus of the school will be on LCA, Carbon Footprint, Water Footprint
and Integrated Reporting.
For all the details please see: www.lcss.unisalento.it/

###

Posted on Sustainabilitank.info on March 15th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

 

Uri Avnery

March 16, 2013

 

                                    To the Victor, the Spoils.

 IN THE days following the recent Israeli elections, Ya’ir Lapid, the major winner, let it be known that he wanted to be the next Foreign Minister.

 No wonder. It’s the hell of a job. You can’t lose, because the Foreign Minister is responsible for nothing. Serious foreign fiascos are always laid at the door of the Prime Minister, who determines foreign policy anyway. The Foreign Minister travels around the world, stays in luxury hotels with gourmet cuisine, has his picture taken in the company of royalty and presidents, appears almost daily on TV. Sheer paradise.

 For someone who declares publicly that he wants to become Prime Minister soon, perhaps in a year and a half, this post is very advantageous. People see you among the world’s great. You look “prime ministerial”. 

 Moreover, no experience is needed. For Lapid, who entered politics less than a year ago, this is ideal. He has all a Foreign Minister needs: good looks and a photogenic quality. After all, he made his career on TV.

 So why did he not become Foreign Minister? Why has he let himself be pushed into the Finance Ministry – a far more strenuous job, which can make or break a politician?

 Simply because the Foreign Ministry has a big sign on its door: Occupied.

 THE LAST Foreign Minister, Avigdor Lieberman, was, probably, the least suitable person for the job in the whole country. He is no Apollo. He has an air of brutality, shifty eyes and spare vocabulary. He is unpopular everywhere in the world except Russia and its satellites.  He has been avoided throughout by most of his international colleagues. Many of them consider him an outright fascist. 

 But Netanyahu is afraid of Lieberman. Without Lieberman’s parliamentary storm troopers, Likud has only 20 seats – just one more than Lapid. And within the joint party, Lieberman may well replace Netanyahu in the not too distant future.

 Lieberman has been forced out of the Foreign Office by the law that forbids an indicted person to serve in the government. For many years now, a dark judicial cloud has been hanging over his head. Investigations followed suspicions of huge bribes. In the end, the Attorney General decided to content himself with an indictment for fraud and breach of trust: a minor diplomat turned over to Lieberman a secret police dossier concerning his investigation and was awarded an ambassadorship.

 Netanyahu’s fear of Lieberman induced him to promise that the Foreign Minister’s post would remain empty until the final judgment in Lieberman’s case. If acquitted, his lofty position will be waiting for him.

 This may be a unique arrangement. After barring Lapid’s ambition to succeed him, Lieberman declared this week triumphantly: “Everyone knows that the Foreign Office belongs to the Israel Beitenu party!” 

 THAT IS an interesting statement. It may be worthwhile pondering its implications.

 How can any government office “belong” to a party?

 In feudal times, the King awarded his nobles hereditary fiefs. Each nobleman was a minor king in his domain, in theory owing allegiance to the sovereign but in practice often almost independent. Are modern ministries such fiefs “belonging” to the party chiefs?

 This is a question of principle. Ministers are supposed to serve the country and its citizens. In theory, the best man or woman suited for the job should be appointed. Party affiliation, of course, does play a role. The Prime Minister must construct a working coalition. But the uppermost consideration, even in a multi-party democratic republic, should be the suitability of the candidate for the particular office.

 Unfortunately, this is rarely the case. Though no elected Prime Minister should go to the length of Ehud Barak, who displayed an almost sadistic delight in placing each of his colleagues in the ministry he was most unsuitable for. Shlomo Ben-Ami, a gentle history professor, was put into the Ministry of Police (a.k.a. Interior Security), where he was responsible for an incident in which several Arab citizens were shot. Yossi Beilin, a genius bubbling with original political ideas, was sent to the Ministry of Justice. And so on.

 I remember meeting several of the new ministers at a diplomatic reception soon after. They were all deeply embittered and their comments were of course unprintable.

 But that was not the point. The point was that by appointing ministers quite unsuitable to the tasks entrusted to them, Barak did great damage to the interests of the state. You don’t entrust your body to a surgeon who is really a lawyer, nor do you entrust your money to a banker who is really a biologist.

 YET THE idea of political entitlement was hovering over the whole process of forming the cabinet. The awarding of the ministries more closely resembles a dispute among thieves over the spoils than a responsible process of manning or womanning the ministries which will be responsible for the security and well-being of the nation.

 The quarrel that held up the formation of the new government for several crucial days was over the Ministry of Education. Lapid wanted it for his No. 2, an orthodox (though moderate) rabbi. The incumbent, Gideon Sa’ar, desperately clung to it, organizing petitions in his favor among teachers, mayors and what not.

 This could have been a legitimate fight if it had been about questions of education. For example, Sa’ar, a fanatical Likud man, has sent the pupils to religious and nationalistic sites in Greater Eretz Israel, to imbue them with proper patriotic fervor. He is also more intent on his pupils winning international capability tests than on education as such.

 But nobody spoke about these subjects. It was a simple fight over entitlement. In medieval times, it might have been fought out with lances in a tournament. In these civilized days, both sides use political blackmail. Lapid won.

 I AM not a great admirer of Tzipi Livni and her air of a spoilt brat. But I am happy about her appointment to the Ministry of Justice.

 Her last two predecessors were intent on destroying the Supreme Court and putting an end to “judicial activism”. (This seems to be a problem in many countries nowadays. Governments want to abolish the court’s power to annul anti-democratic laws.) Tzipi can be relied on to buttress the Supreme Court, seen by many as “the last bastion of Israeli democracy”.

 Much more problematical is the appointment of Moshe Ya’alon as Minister of Defense. He inherited the job because there is just nobody around who could be appointed instead. Israelis take their defense seriously, and you cannot appoint, say, a gynecologist to this job.

 “Bogy”, as everybody calls him, is a former Chief of Staff of the Army, and a very undistinguished one. Indeed, when he finished the standard three years on the job, Prime Minister Ariel Sharon refused to grant him the almost automatic fourth year. Bogy was bitter and complained that he always had to wear high boots, because of the many snakes in the Ministry of Defense and the General Staff. He may need them again now.

 His many detractors call him a “bock” – German and Yiddish for a goat, symbolizing a lack of intelligence. He is an extreme militarist, who sees all problems through the sights of a gun. He can be sure of the allegiance of Israel’s vast army of ex-generals (or “degenerals”’ as I call them).

  THE MOST problematical appointment of all is the choice of Uri Ariel for the crucial post of Minister of Housing.

Uri Ariel is the arch-settler. He was the founder of a settlement, a leader of the settlers’ organization, the Ministry of Defense official responsible for the settlements. He was also a director of the Keren Kayemet – Jewish National Fund – a major arm of the settlement enterprise. He entered the Knesset when Rehavam Ze’evi, the leader of the extreme-extreme Right, was assassinated by a Palestinian hit squad.

Turning this Ministry over to such a person means that most of its resources will go to a frantic expansion of the settlements, each of which is a nail in the coffin of peace. Yet Lapid supported this appointment with all his new-found political clout, as part of his “brotherhood” bond with Naftali Bennett, who is now the godfather of the settler movement.

Bennet’s party also gained the all-important Knesset finance committee, which is needed to funnel the funds to the settlements. It means that the settlers have gained complete control of the state.

Lapid’s big election victory may yet be revealed as the biggest disaster for Israel.

The brotherhood pact between Lapid and Bennett made it possible for them to blackmail poor Netanyahu and get (almost) everything they longed for. Except the Foreign Ministry.

How will Lapid turn out as Minister of Finance? Difficult to say. Since he is totally innocent of any economic knowledge or experience, he will have to depend on the Prime Minister above and the ministry bureaucracy below. Treasury officials are a tough lot, with a thoroughly neo-liberal outlook. Lapid himself also adheres to this creed, which is called by many Israelis “swinish capitalism” – a term invented by Shimon Peres.

ONE of Lapid’s main election promises was to put an end to the Old Politics, held responsible for all the ills and ugliness of our political life until now. Instead, he said, there will be the New Politics, an age of shining honesty and transparency, embodied by selfless and patriotic leaders, such as the members of his new party.

 Not for nothing did he call his party There Is A Future.

Well, the Future has arrived, and it looks suspiciously like the Past. Indeed, the New Politics look very much like the Old Politics.

 Very, very old. Even the ancient Romans are supposed to have said “To the victor, the spoils!” But then, Ya’ir Lapid doesn’t know Latin.

——————————

Others, like Ari Shavit of Haaretz, look at the Obama visit, with expressed worry – something like -  The President who holds Israel’s fate in the palm of his hand: Israel has recently lost quite a bit of its ability to chart its own strategic future, and this will make Obama’s upcoming trip different than previous ones by U.S. presidents.

Above is potentially much more serious then if Ms. Merkel would pay a visit to Rome as in our second clip. There it is only about restructure and money – in Israel it is about restructure and Near East neighborhood policy.

——————————-

New York Times Editorial – March 15, 2013

Italy, in Search of a Government.

By
Published: March 14, 2013

Italy’s newly elected Parliament convenes on Friday with no clear governing majority. Only a government with a strong popular mandate can push through the kind of radical changes Italy really needs: sweeping labor market and tax reforms, tough anticorruption laws, electoral reform and a new fiscal bargain with euro-zone partners that replaces austerity with growth. All or most of that will now have to wait until new elections, probably later this year, can produce more definitive results.

The vote produced a four-way split among two parties that endorse the European-backed austerity policies that have plunged Italy into deep recession, the anti-establishment Five Star Movement and a bloc led by former Prime Minister Silvio Berlusconi.

That four-way split means that no politically feasible coalition is mathematically possible, especially since the Five Star Movement’s founder, Beppe Grillo, has repeatedly declared that the movement will not support a government led by any of the other groupings. Even if Mr. Grillo does not reconsider that position, there is no need for Italians, their European partners or the bond markets to panic. Mario Monti will continue as the caretaker prime minister until Parliament can agree on a successor. Taxes will be collected, government bills paid and administrative decisions taken. One ratings agency, Fitch, last week downgraded Italian bonds one notch but still considers them investment grade. Bond auctions this week went tolerably well, and Rome has now successfully raised a significant chunk of the money it will need to see it through this year. Democracy’s ways can be frustratingly slow, especially when radical changes are on the agenda and long established parties fail to rise to the occasion. Yet democracy is the European Union’s founding and defining principle. Italy’s partners, though understandably frustrated, need to be patient and supportive. And the European Central Bank must be prepared to deter speculators by stepping in if necessary as a lender of last resort.

Those, like Chancellor Angela Merkel of Germany, who pressured Mr. Monti’s government to tighten the screws of austerity on Italy’s growth-starved economy share some responsibility for his disappointing electoral performance. And they now share some responsibility to stand by Italy as it seeks a democratic way out of the resulting parliamentary deadlock.

A version of this editorial appeared in print on March 15, 2013, on page A24 of the New York edition with the headline: Italy, in Search of a Government.

 

 

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Posted on Sustainabilitank.info on March 5th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

This is serious – a professional clown is a good man trying to make a living. A clown impersonator is something else. While Bepe Grillo is fighting for the cause of change in Italy and everywhere else, it is Mr. Berlusconi who used the facade of government and wealth in order to create a court of clowns to his kingdom and rule. True Conservatives reject his behavior but corralled  to save him because he was in their service.

March 4th, 2013 the  Karl Renner Institute of the Socialist Party of Austria had a reassessment of the Italian elections with the participation of two Journalists from Italy – Tonia Mastrobuoni from La Stampa in Turino, and Franz Koessler  who was for many years the foreign policy commentator at the Austrian “Falter” and is now a freelance in Rome.

I learned that Monti who was seen by the European banking institutions as the man who will save them and Italy, and was seen as  having the baking of over 50% of the Italians – just came in as a poor fourth with 10%. It is the 25% that Grillo’s movement got .and the fact that the other two parties that have less then 30% each – that make it impossible to form a government that is supported by a clear majority.

The popular thinking is that new elections will favor Mr. Grillo and put him in the position to dictate the rules for a coalition government.

Conventional thinking believes that if he has not put forward a real plan, and is not ready to join another party, this is a sign that his group will eventually break up. But why? His Grillini want to see change, and not being politicians that live by having a political job, they may actually relish the idea of having brought about change and be very calculated in their support of any government.

I suggested that the original individuals that started out like them, could actually be the example for the Grilini – and the warning being that eventually politicians from the right got hold of their movement and turned the Tea Party that started out as “Taxes we had enough” ended up backing all sort of ideas that had nothing to do with their original rebellion.

On the other hand, if the Grillini manage to avoid the fate of the Tea Party, they may become the toast of all those in the EU that would want to change the rullling strata in most of the EU Member States.
—————————————————————————————-
The New York Times Editorial

Italy Chooses None of the Above

First Published: February 27, 2013

Italy’s voters surprised and frightened governments and financial markets across Europe with their repudiation of austerity and much of the Italian political establishment.

Europe’s fears of an ungovernable Italy and renewed euro-zone crisis may prove justified. With no party holding a majority in the new Parliament, there is little chance for renegotiating the economic straitjacket demanded by European lenders or enacting needed reforms.

For decades, the political establishment, regardless of party, has failed to deal with Italy’s well-known problems — excessive bureaucracy, official corruption, organized crime, unequal and regressive taxes and anemic economic growth. The past 15 months of growth-crushing austerity policies under Prime Minister Mario Monti have mainly added to the pain. Italy’s borrowing costs declined (at least until the election returns came in).
But recession has deepened, unemployment has risen and living standards have fallen back to the levels of the 1980s. Mr. Monti’s popularity never recovered from the deeply regressive tax he imposed on family homes.

A protest vote driven by public anger is not so surprising. The big losers were centrist supporters of Mr. Monti, who came in a dismal fourth, and the center-left Democratic Party, led by Pier Luigi Bersani, which won only a slim plurality in the lower house and ran a disappointing second in the regionally apportioned Senate. These two blocs were expected to form a coalition government with policies not very different from Mr. Monti’s. That would have pleased Europe, but is now impossible.

The winners were the anti-establishment Five Star Movement, founded just three years ago by the comedian Beppe Grillo, and the People of Liberty led by the disgraced former prime minister, Silvio Berlusconi. Mr. Berlusconi’s slate won the largest number of Senate seats and the second largest contingent in the lower house. Mr. Berlusconi, who bears much responsibility for Italy’s economic and political dysfunction, brought his party back from near oblivion by shamelessly restyling himself as an anti-establishment, anti-austerity populist. He even promised to refund the homeownership tax, offering to dip into his personal fortune to do so.

As the top vote-getter, the Democratic Party gets the first chance to form a new government. Recognizing how tough that will be, Mr. Bersani has begun setting forth a limited legislative program that he hopes can attract support from beyond his own ranks. Mr. Grillo declared Wednesday that his supporters would not form an alliance with Mr. Bersani, or Mr. Berlusconi, who gets to try next if Mr. Bersani fails. But he did leave open the option of backing specific reform measures proposed by other parties. That is not a prescription for stable government and could force another election later this year. But it is probably the best hope for enacting at least some of the political reforms and anti-corruption laws Italy desperately needs and so many fed-up Italian voters desperately want.

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Posted on Sustainabilitank.info on March 4th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

Recovery in U.S. Lifting Profits, Not Adding Jobs

By NELSON D. SCHWARTZ

Experts estimate so-called budget sequestration could cost the country about 700,000 jobs, but Wall Street doesn’t expect the cuts to substantially alter corporate profits or threaten stock markets.

—————–

Opinionator

A Sneaky Way to Deregulate

By STEVEN RATTNER

It’s called a jobs act, but it’s really a con job for small investors.

——————

A Jester No More, Italy’s Gadfly of Politics Reflects a Movement

By LIZ ALDERMAN and ELISABETTA POVOLEDO

In a rare interview, Beppe Grillo said his goal was to do away with a system that had “disintegrated the country” and build “something new.”

——————

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Posted on Sustainabilitank.info on March 4th, 2013
by Pincas Jawetz (PJ@SustainabiliTank.com)

March 3, 2013

Populists or Business (Banking) Lobbyists?

The public media and European mainstream parties’ politicians are unisono lamenting the rise of populism as manifested by the strong showing of Beppe Grillo in Italy’s parliamentary election last weekend. They decry, as they did earlier in the case of Greece, when the “populist” Syriza party nearly won the election, the irresponsibility, the negativism, the “against-it-all” attitude of these parties’ leaders. Let us add to these election results the street demonstrations and battles in Greece, in Spain, in Portugal, in Bulgaria, in Slovenia – all these before the background of people jumping to death from windows of their to-be-repossessed apartments, of soup kitchens, of soaring unemployment rates (especially, and even more tragically, of the young), and of the horrifying increase in poverty rates in many of these and other countries.

It does seem, that in spite of these politicians’ lamentoes, that European citizens are no longer accepting the crisis resolution policies imposed on them by politicians – at the bidding of financial markets. Yes, Mario Monti, the unelected and now defeated prime minister, managed to calm “market fears”, yes, Mario Draghi, the ECB president, managed to do the same – and more – by last fall promising to “do everything necessary” to enable European states’ return to the financial markets, yes, some of the Southern states (plus Ireland) were able during the past months to place bond auctions at “sustainable” yields (i.e. below the benchmark of 6%). But the concomitant “aid programs” by the European Central Bank, the European Commission and the International Monetary Fund, the dreaded “troika” are what the restive populations are no longer willing to swallow. Since governments took over bank debt, the citizens have been called upon to foot the bill, by having their taxes increased, government expenditures, especially social expenditures, cut and losing their jobs as a result of the persistent recession which these programs (and the similar, if less stringent “debt brake” conditions imposed on all EU countries. There is already talk about a “lost decade” for Europe.

With all this austerity (which is portrayed as without alternative) it is completely unclear where future growth should come from even after this decade. The mainstream recipe that balanced budgets (and their corresponding structural reforms) guarantee growth has been proven false, not only in theory, but also in empirical practice. If the second largest economic block in the world (with about 18 trillion $ in GDP, about one fourth of the world economy) reduces public sector demand in addition to falling demand in the private sector, this affects the whole world. This is different from the frequently cited more recent cases, where one individual country managed to export its way out of recession, when all other countries were growing and thus increasing their demand.

In this situation, the EU parliament has achieved a spectacular success, by agreeing (also with EU Finance Ministers) to limit bankers’ bonus payments to 100% of base salary (in exceptional cases to 200%). This is part of a hard-fought package setting new rules for European banks’ equity and liquidity requirements. There are widespread “populism” cries by especially English bankers, but also their colleagues around Europe that this would drive out banking from Europe, that this is a Continental coup to transfer banking business from London to Paris or Frankfurt (??), that this is “unfair”. The more sanguine bankers say (see eg. Financial Times March 2, 2013) that this just means that their base salary will have to be doubled as a consequence. Tory MPs are fuming and using this as an additional argument that the UK should leave the EU as soon as possible. Of course, they do not mention the fact that it was their leader, David Cameron, who pulled the Tories out of the European Peoples’ Party group, which – in the form of the Austrian Othmar Karas – was leading the negotiations of the European Parliament with the Finance Ministers. They also forget to mention that banking lobbies (led by the English) have delayed and watered down the other parts of the Banking package to be concluded.

The Greek and Italian elections, the street protests, the events in many other European countries should lead to a realization by the EU policy makers, both in the Central Bank, in the Commission and in the Council, that it is not just “clowns” (@ Peer Steinbruck, the Social Democratic candidate for the German premiership) who say “no more” to this oppressive economic policy recipe, but it is large parts of the European populations who have not only lost confidence that these recipes will work, but actively are against them – because they see that as in the Great Depression of the late 1920s – they lead to impoverishment and political disaster. Politicians should listen more closely to their populations, and less to the financial sector lobbyists, who have caused this crisis and refuse to play their part in shouldering their part of the burden. It was the lobbyists’ close connection to the politicians who made banking debts into government debt, it was their whisperings which had told politicians fairy tales about the financial markets being the most efficient markets in the world, thus self-regulation and “light-touch” regulation was all that was needed.

What are the alternatives?

The primary policy objective should not be to “return countries to financial markets’ access”, but to have indebted states return to a sustainable economic and social policy path which improves the welfare of their populations. To this end, government debt financing should be taken away from financial markets and turned over to a publicly accountable public institutions (the ECB or the ESM with a banking licence).

As far as bank debt is concerned, a European plan must be developed with a medium-term view of how the European Financial sector should look like in 10-20 years. This would counter-act the present “re-nationalization” trends where every country attempts to save its banks (frequently at the expense of others) at high costs to the taxpayers. Some banks will need to be closed, others restructured, and effective regulation set up. It is clear that (some) debts will need to be repaid, but much of bank debt should be paid by bank owners and their bondholders, not by taxpayers. For highly indebted bank sectors, a European bank resolution fund could take over some of the debt.

It is true that a number of “problem countries” in the EU have pursued wrong policies in the past, e.g. waste of public (EU and national) funds, neglect of innovation and R&D policies, high military expenditures, neglect of industrial policies, neglect of modern education systems, neglect of building up sustainable energy systems (both on the supply and demand side), and many more. Each country needs to develop a positive vision of where it wants to stand in 10 years’ time, and then select the appropriate instruments, and convince its EU partners of its way.
The major political task will be to convince the populations that there is light at the end of the tunnel, that some sacrifices are necessary, but that these will be distributed equitably, that there are positive prospects for this and the next generation, that the social system will cushion the inevitable burdens. To generate the confidence that “we are all in this together” will not be credible, if voiced by those politicians who have gotten us (knowingly or unknowingly) into the present mess. This is the task for new, and credible politicians who not only know what possible alternatives are, but can also muster enough support, both political and technical, from the populations who voted for them. This may and will require new communication methods – as they have been employed during the recent elections.

At a European level, a new more comprehensive economic policy umbrella must be opened. The nearly exclusive attention to budget consolidation was geared to placating the financial markets – who also are getting cold feet seeing what “their” policies do to growth (see the most recent downgrade of the UK). It must throw off the yoke of financial market dictate and turn itself to strengthening the European model, with a view to balance social, economic and environmental requirements for the future.

European civil society is growing together. Public institutions, like the labor movement, are not. In the face of the crisis, labor unions are re-nationalizing, attempting to save jobs for their own members at the expense of their foreign colleagues. They should learn from the business lobby, which has been much more successful in convincing European and national policy makers of their own interests.

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Posted on Sustainabilitank.info on October 24th, 2012
by Pincas Jawetz (PJ@SustainabiliTank.com)

We decided to post this because of reference in the case to engineering failures in the Katrina event and the AAAS intervention in Italy for the defense.  Our concern is in the Industrial Business interests that are behind the interference in full disclosure of true scientific knowledge on subjects like the effects of Human-induced climate change, and their potential cause for higher frequency and strength of what we still wrongfully call natural disasters. What power wield such interests thanks to the way we fund our academic institutions and our political campaigns?

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They invite comments:  Add a comment

Monday, a regional Italian court convicted six scientists and a government official of manslaughter for failing to adequately warn local residents prior to the 2009 L’Aquila earthquake that killed 309 people.   Defendants have been sentenced to six years in prison and ordered to pay 7.8 million euros ($10.2 million) in damages and costs.  In addition, all seven have been barred from ever holding public office again.  Lawyers for the defense have said they will appeal the sentence.

Defendants include six scientists from the Italian National Institute of Geophysics and Volcanology and a government official from the Civil Protection Agency, all seven of whom were part of the National Commission for the Forecast and Prevention of Major Risks.  The scientists are among the most prominent and internationally respected seismologists and geological experts in Italy.

On March 31, 2009, just one week before an April 6th earthquake devastated the region, the seven officials met to discuss a series of small earthquakes and tremors that had shaken the region for weeks.  After that meeting, a memo was issued telling residents that an earthquake was “unlikely,” but not impossible.  Some defendants issued encouraging statements to the local news media, and Bernardo de Bernardinis, former deputy director of the Department of Civil Protection, issued a public statement that there was “no danger,” stating, “the scientific community keeps saying the situation is favorable because of the continuous discharge of energy.”  He reportedly told citizens to relax with a glass of wine.

Residents of L’Aquila claim the predictions and statements made by defendants convinced them to remain in their homes even as the tremors grew worse, when they would normally have fled.  Prosecutors maintained these statements were falsely reassuring, and Judge Marco Billi, after four hours deliberation, determined that the scientists had provided “superficial and ineffective” assessments and disclosed “inaccurate, incomplete and contradictory” information about earthquake danger.

Defense attorneys argued that the defendants had used the best predictions available and accused the court of putting science itself on trial.  5,000 scientists from the American Association for the Advancement of Science (AAAS) signed an open letter to Italian President Giorgio Napolitano in support of the defendants, saying:  ”It is manifestly unfair for scientists to be criminally charged for failing to act on information that the international scientific community would consider inadequate as a basis for issuing a warning.”

In protest, the head of the National Commission for the Forecast and Prevention of Major Risks, Professor Luciano Maiani, resigned yesterday.  “The situation created by yesterday’s sentence… is incompatible with running the commission’s work in a calm and efficient manner and with its role of giving high level advice to the organs of the state,” Maiani said in a statement.  Maiani’s decision to quit was announced by the Italy’s Civil Protection Department, which said the commission’s vice-president, Mauro Rosi, and emeritus president Giuseppe Zamberletti had also tendered their resignations.  Nature magazine has declared, ”The verdict is perverse and the sentence ludicrous.”

More details on the L’Aquilo case can be found in news reports in the BBC, Telegraph, and New York Times.

Note: Reference to In re Katrina Canal Breaches

In his closing statement, prosecutor Fabio Picuti reportedly referred to a U.S. court decision that found the Army Corps of Engineers liable for “monumental negligence” resulting in some of the flooding from Hurricane Katrina (In re Katrina Canal Breaches).  Picuti blamed the same “failure of initiative” to forecast the risks for L’Aquila. [For more commentary on the initial In re Katrina decision, see Director Michael Gerrard’s May 2012 article in the New York Law Journal.]  Picuti does not appear to have noted that the Fifth Circuit reversed its position and issued a new decision Sep 24 2012. In its latest decision, the panel reversed itself on the discretionary function exemption issue.  It found that the US Corps of Engineers’ failure to armor the Mississippi River Gulf Outlet (MRGO) or keep its sides from falling in were discretionary acts, and thus exempt from liability under the Federal Tort Claims Act.  Based on that, it dismissed the lawsuit.

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Posted on Sustainabilitank.info on June 3rd, 2012
by Pincas Jawetz (PJ@SustainabiliTank.com)

George Soros Remarks at the Festival of Economics.

June 2, 2012

Trento, Italy

Ever since the Crash of 2008 there has been a widespread recognition, both among economists and the general public, that economic theory has failed. But there is no consensus on the causes and the extent of that failure. I believe that the failure is more profound than generally recognized. It goes back to the foundations of economic theory.

Economics tried to model itself on Newtonian physics. It sought to establish universally and timelessly valid laws governing reality. But economics is a social science and there is a fundamental difference between the natural and social sciences. Social phenomena have thinking participants who base their decisions on imperfect knowledge. That is what economic theory has tried to ignore.

Scientific method needs an independent criterion, by which the truth or validity of its theories can be judged. Natural phenomena constitute such a criterion; social phenomena do not. That is because natural phenomena consist of facts that unfold independently of any statements that relate to them. The facts then serve as objective evidence by which the validity of scientific theories can be judged. That has enabled natural science to produce amazing results.

Social events, by contrast, have thinking participants who have a will of their own.  They are not detached observers but engaged decision makers whose decisions greatly influence the course of events. Therefore the events do not constitute an independent criterion by which participants can decide whether their views are valid. In the absence of an independent criterion people have to base their decisions not on knowledge but on an inherently biased and to greater or lesser extent distorted interpretation of reality. Their lack of perfect knowledge or fallibility introduces an element of indeterminacy into the course of events that is absent when the events relate to the behavior of inanimate objects. The resulting uncertainty hinders the social sciences in producing laws similar to Newton’s physics.

Economics, which became the most influential of the social sciences, sought to remove this handicap by taking an axiomatic approach similar to Euclid’s geometry. But Euclid’s axioms closely resembled reality while the theory of rational expectations and the efficient market hypothesis became far removed from it. Up to a point the axiomatic approach worked. For instance, the theory of perfect competition postulated perfect knowledge. But the postulate worked only as long as it was applied to the exchange of physical goods. When it came to production, as distinct from exchange, or to the use of money and credit, the postulate became untenable because the participants’ decisions involved the future and the future cannot be known until it has actually occurred.

I am not well qualified to criticize the theory of rational expectations and the efficient market hypothesis because as a market participant I considered them so unrealistic that I never bothered to study them. That is an indictment in itself but I shall leave a detailed critique of these theories to others.

Instead, I should like to put before you a radically different approach to financial markets. It was inspired by Karl Popper who taught me that people’s interpretation of reality never quite corresponds to reality itself. This led me to study the relationship between the two. I found a two-way connection between the participants’ thinking and the situations in which they participate.

On the one hand people seek to understand the situation; that is the cognitive function. On the other, they seek to make an impact on the situation; I call that the causative or manipulative function. The two functions connect the thinking agents and the situations in which they participate in opposite directions.

In the cognitive function the situation is supposed to determine the participants’ views; in the causative function the participants’ views are supposed to determine the outcome. When both functions are at work at the same time they interfere with each other. The two functions form a circular relationship or feedback loop. I call that feedback loop reflexivity. In a reflexive situation the participants’ views cannot correspond to reality because reality is not something independently given; it is contingent on the participants’ views and decisions. The decisions, in turn, cannot be based on knowledge alone; they must contain some bias or guess work about the future because the future is contingent on the participants’ decisions.

Fallibility and reflexivity are tied together like Siamese twins. Without fallibility there would be no reflexivity – although the opposite is not the case: people’s understanding would be imperfect even in the absence of reflexivity. Of the two twins, fallibility is the first born. Together, they ensure both a divergence between the participants’ view of reality and the actual state of affairs and a divergence between the participants’ expectations and the actual outcome.

Obviously, I did not discover reflexivity. Others had recognized it before me, often under a different name. Robert Merton wrote about self-fulfilling prophecies and the bandwagon effect, Keynes compared financial markets to a beauty contest where the participants had to guess who would be the most popular choice. But starting from fallibility and reflexivity I focused on a problem area, namely the role of misconceptions and misunderstandings in shaping the course of events that mainstream economics tried to ignore. This has made my interpretation of reality more realistic than the prevailing paradigm.

Among other things, I developed a model of a boom-bust process or bubble which is endogenous to financial markets, not the result of external shocks. According to my theory, financial bubbles are not a purely psychological phenomenon.  They have two components: a trend that prevails in reality and a misinterpretation of that trend. A bubble can develop when the feedback is initially positive in the sense that both the trend and its biased interpretation are mutually reinforced. Eventually the gap between the trend and its biased interpretation grows so wide that it becomes unsustainable. After a twilight period both the bias and the trend are reversed and reinforce each other in the opposite direction. Bubbles are usually asymmetric in shape: booms develop slowly but the bust tends to be sudden and devastating. That is due to the use of leverage: price declines precipitate the forced liquidation of leveraged positions.

Well-formed financial bubbles always follow this pattern but the magnitude and duration of each phase is unpredictable. Moreover the process can be aborted at any stage so that well-formed financial bubbles occur rather infrequently.

At any moment of time there are myriads of feedback loops at work, some of which are positive, others negative. They interact with each other, producing the irregular price patterns that prevail most of the time; but on the rare occasions that bubbles develop to their full potential they tend to overshadow all other influences.

According to my theory financial markets may just as soon produce bubbles as tend toward equilibrium. Since bubbles disrupt financial markets, history has been punctuated by financial crises. Each crisis provoked a regulatory response. That is how central banking and financial regulations have evolved, in step with the markets themselves. Bubbles occur only intermittently but the interplay between markets and regulators is ongoing. Since both market participants and regulators act on the basis of imperfect knowledge the interplay between them is reflexive. Moreover reflexivity and fallibility are not confined to the financial markets; they also characterize other spheres of social life, particularly politics. Indeed, in light of the ongoing interaction between markets and regulators it is quite misleading to study financial markets in isolation. Behind the invisible hand of the market lies the visible hand of politics. Instead of pursuing timeless laws and models we ought to study events in their time bound context.

My interpretation of financial markets differs from the prevailing paradigm in many ways. I emphasize the role of misunderstandings and misconceptions in shaping the course of history. And I treat bubbles as largely unpredictable. The direction and its eventual reversal are predictable; the magnitude and duration of the various phases is not. I contend that taking fallibility as the starting point makes my conceptual framework more realistic. But at a price: the idea that laws or models of universal validity can predict the future must be abandoned.

Until recently, my interpretation of financial markets was either ignored or dismissed by academic economists. All this has changed since the crash of 2008. Reflexivity became recognized but, with the exception of Imperfect Knowledge Economics, the foundations of economic theory have not been subjected to the profound rethinking that I consider necessary. Reflexivity has been accommodated by speaking of multiple equilibria instead of a single one. But that is not enough. The fallibility of market participants, regulators, and economists must also be recognized.  A truly dynamic situation cannot be understood by studying multiple equilibria.  We need to study the process of change.

The euro crisis is particularly instructive in this regard. It demonstrates the role of misconceptions and a lack of understanding in shaping the course of history. The authorities didn’t understand the nature of the euro crisis; they thought it is a fiscal problem while it is more of a banking problem and a problem of competitiveness. And they applied the wrong remedy: you cannot reduce the debt burden by shrinking the economy, only by growing your way out of it. The crisis is still growing because of a failure to understand the dynamics of social change; policy measures that could have worked at one point in time were no longer sufficient by the time they were applied.

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Since the euro crisis is currently exerting an overwhelming influence on the global economy I shall devote the rest of my talk to it. I must start with a warning: the discussion will take us beyond the confines of economic theory into politics and the dynamics of social change. But my conceptual framework based on the twin pillars of fallibility and reflexivity still applies. Reflexivity doesn’t always manifest itself in the form of bubbles. The reflexive interplay between imperfect markets and imperfect authorities goes on all the time while bubbles occur only infrequently. This is a rare occasion when the interaction exerts such a large influence that it casts its shadow on the global economy. How could this happen? My answer is that there is a bubble involved, after all, but it is not a financial but a political one. It relates to the political evolution of the European Union and it has led me to the conclusion that the euro crisis threatens to destroy the European Union. Let me explain.

I contend that the European Union itself is like a bubble. In the boom phase the EU was what the psychoanalyst David Tuckett calls a “fantastic object” – unreal but immensely attractive. The EU was the embodiment of an open society –an association of nations founded on the principles of democracy, human rights, and rule of law in which no nation or nationality would have a dominant position.

The process of integration was spearheaded by a small group of far sighted statesmen who practiced what Karl Popper called piecemeal social engineering. They recognized that perfection is unattainable; so they set limited objectives and firm timelines and then mobilized the political will for a small step forward, knowing full well that when they achieved it, its inadequacy would become apparent and require a further step. The process fed on its own success, very much like a financial bubble. That is how the Coal and Steel Community was gradually transformed into the European Union, step by step.

Germany used to be in the forefront of the effort. When the Soviet empire started to disintegrate, Germany’s leaders realized that reunification was possible only in the context of a more united Europe and they were willing to make considerable sacrifices to achieve it.  When it came to bargaining they were willing to contribute a little more and take a little less than the others, thereby facilitating agreement.  At that time, German statesmen used to assert that Germany has no independent foreign policy, only a European one.

The process culminated with the Maastricht Treaty and the introduction of the euro. It was followed by a period of stagnation which, after the crash of 2008, turned into a process of disintegration. The first step was taken by Germany when, after the bankruptcy of Lehman Brothers, Angela Merkel declared that the virtual guarantee extended to other financial institutions should come from each country acting separately, not by Europe acting jointly. It took financial markets more than a year to realize the implication of that declaration, showing that they are not perfect.

The Maastricht Treaty was fundamentally flawed, demonstrating the fallibility of the authorities. Its main weakness was well known to its architects: it established a monetary union without a political union. The architects believed however, that when the need arose the political will could be generated to take the necessary steps towards a political union.

But the euro also had some other defects of which the architects were unaware and which are not fully understood even today. In retrospect it is now clear that the main source of trouble is that the member states of the euro have surrendered to the European Central Bank their rights to create fiat money. They did not realize what that entails – and neither did the European authorities. When the euro was introduced the regulators allowed banks to buy unlimited amounts of government bonds without setting aside any equity capital; and the central bank accepted all government bonds at its discount window on equal terms. Commercial banks found it advantageous to accumulate the bonds of the weaker euro members in order to earn a few extra basis points. That is what caused interest rates to converge which in turn caused competitiveness to diverge. Germany, struggling with the burdens of reunification, undertook structural reforms and became more competitive. Other countries enjoyed housing and consumption booms on the back of cheap credit, making them less competitive. Then came the crash of 2008 which created conditions that were far removed from those prescribed by the Maastricht Treaty. Many governments had to shift bank liabilities on to their own balance sheets and engage in massive deficit spending. These countries found themselves in the position of a third world country that had become heavily indebted in a currency that it did not control. Due to the divergence in economic performance Europe became divided between creditor and debtor countries. This is having far reaching political implications to which I will revert.

It took some time for the financial markets to discover that government bonds which had been considered riskless are subject to speculative attack and may actually default; but when they did, risk premiums rose dramatically. This rendered commercial banks whose balance sheets were loaded with those bonds potentially insolvent. And that constituted the two main components of the problem confronting us today: a sovereign debt crisis and a banking crisis which are closely interlinked.

The eurozone is now repeating what had often happened in the global financial system. There is a close parallel between the euro crisis and the international banking crisis that erupted in 1982. Then the international financial authorities did whatever was necessary to protect the banking system: they inflicted hardship on the periphery in order to protect the center. Now Germany and the other creditor countries are unknowingly playing the same role. The details differ but the idea is the same: the creditors are in effect shifting the burden of adjustment on to the debtor countries and avoiding their own responsibility for the imbalances. Interestingly, the terms “center” and “periphery” have crept into usage almost unnoticed. Just as in the 1980’s all the blame and burden is falling on the “periphery” and the responsibility of the “center” has never been properly acknowledged.  Yet in the euro crisis the responsibility of the center is even greater than it was in 1982. The “center” is responsible for designing a flawed system, enacting flawed treaties, pursuing flawed policies and always doing too little too late. In the 1980’s Latin America suffered a lost decade; a similar fate now awaits Europe. That is the responsibility that Germany and the other creditor countries need to acknowledge. But there is now sign of this happening.

The European authorities had little understanding of what was happening. They were prepared to deal with fiscal problems but only Greece qualified as a fiscal crisis; the rest of Europe suffered from a banking crisis and a divergence in competitiveness which gave rise to a balance of payments crisis. The authorities did not even understand the nature of the problem, let alone see a solution. So they tried to buy time.

Usually that works. Financial panics subside and the authorities realize a profit on their intervention. But not this time because the financial problems were reinforced by a process of political disintegration. While the European Union was being created, the leadership was in the forefront of further integration; but after the outbreak of the financial crisis the authorities became wedded to preserving the status quo. This has forced all those who consider the status quo unsustainable or intolerable into an anti-European posture. That is the political dynamic that makes the disintegration of the European Union just as self-reinforcing as its creation has been.  That is the political bubble I was talking about.

At the onset of the crisis a breakup of the euro was inconceivable: the assets and liabilities denominated in a common currency were so intermingled that a breakup would have led to an uncontrollable meltdown. But as the crisis progressed the financial system has been progressively reordered along national lines. This trend has gathered momentum in recent months. The Long Term Refinancing Operation (LTRO) undertaken by the European Central Bank enabled Spanish and Italian banks to engage in a very profitable and low risk arbitrage by buying the bonds of their own countries. And other investors have been actively divesting themselves of the sovereign debt of the periphery countries.

If this continued for a few more years a break-up of the euro would become possible without a meltdown – the omelet could be unscrambled – but it would leave the central banks of the creditor countries with large claims against the central banks of the debtor countries which would be difficult to collect. This is due to an arcane problem in the euro clearing system called Target2. In contrast to the clearing system of the Federal Reserve, which is settled annually, Target2 accumulates the imbalances. This did not create a problem as long as the interbank system was functioning because the banks settled the imbalances themselves through the interbank market. But the interbank market has not functioned properly since 2007 and the banks relied increasingly on the Target system. And since the summer of 2011 there has been increasing capital flight from the weaker countries. So the imbalances grew exponentially. By the end of March this year the Bundesbank had claims of some 660 billion euros against the central banks of the periphery countries.

The Bundesbank has become aware of the potential danger. It is now engaged in a campaign against the indefinite expansion of the money supply and it has started taking measures to limit the losses it would sustain in case of a breakup. This is creating a self-fulfilling prophecy. Once the Bundesbank starts guarding against a breakup everybody will have to do the same.

This is already happening. Financial institutions are increasingly reordering their European exposure along national lines just in case the region splits apart. Banks give preference to shedding assets outside their national borders and risk managers try to match assets and liabilities within national borders rather than within the eurozone as a whole. The indirect effect of this asset-liability matching is to reinforce the deleveraging process and to reduce the availability of credit, particularly to the small and medium enterprises which are the main source of employment.

So the crisis is getting ever deeper. Tensions in financial markets have risen to new highs as shown by the historic low yield on Bunds. Even more telling is the fact that the yield on British 10 year bonds has never been lower in its 300 year history while the risk premium on Spanish bonds is at a new high.

The real economy of the eurozone is declining while Germany is still booming. This means that the divergence is getting wider. The political and social dynamics are also working toward disintegration. Public opinion as expressed in recent election results is increasingly opposed to austerity and this trend is likely to grow until the policy is reversed. So something has to give.

In my judgment the authorities have a three months’ window during which they could still correct their mistakes and reverse the current trends. By the authorities I mean mainly the German government and the Bundesbank because in a crisis the creditors are in the driver’s seat and nothing can be done without German support.

I expect that the Greek public will be sufficiently frightened by the prospect of expulsion from the European Union that it will give a narrow majority of seats to a coalition that is ready to abide by the current agreement. But no government can meet the conditions so that the Greek crisis is liable to come to a climax in the fall. By that time the German economy will also be weakening so that Chancellor Merkel will find it even more difficult than today to persuade the German public to accept any additional European responsibilities. That is what creates a three months’ window.

Correcting the mistakes and reversing the trend would require some extraordinary policy measures to bring conditions back closer to normal, and bring relief to the financial markets and the banking system. These measures must, however, conform to the existing treaties. The treaties could then be revised in a calmer atmosphere so that the current imbalances will not recur. It is difficult but not impossible to design some extraordinary measures that would meet these tough requirements. They would have to tackle simultaneously the banking problem and the problem of excessive government debt, because these problems are interlinked. Addressing one without the other, as in the past, will not work.

Banks need a European deposit insurance scheme in order to stem the capital flight. They also need direct financing by the European Stability Mechanism (ESM) which has to go hand-in-hand with eurozone-wide supervision and regulation. The heavily indebted countries need relief on their financing costs. There are various ways to provide it but they all need the active support of the Bundesbank and the German government.

That is where the blockage is. The authorities are working feverishly to come up with a set of proposals in time for the European summit at the end of this month. Based on the current newspaper reports the measures they will propose will cover all the bases I mentioned but they will offer only the minimum on which the various parties can agree while what is needed is a convincing commitment to reverse the trend. That means the measures will again offer some temporary relief but the trends will continue. But we are at an inflection point.  After the expiration of the three months’ window the markets will continue to demand more but the authorities will not be able to meet their demands.

It is impossible to predict the eventual outcome. As mentioned before, the gradual reordering of the financial system along national lines could make an orderly breakup of the euro possible in a few years’ time and, if it were not for the social and political dynamics, one could imagine a common market without a common currency. But the trends are clearly non-linear and an earlier breakup is bound to be disorderly. It would almost certainly lead to a collapse of the Schengen Treaty, the common market, and the European Union itself. (It should be remembered that there is an exit mechanism for the European Union but not for the euro.) Unenforceable claims and unsettled grievances would leave Europe worse off than it was at the outset when the project of a united Europe was conceived.

But the likelihood is that the euro will survive because a breakup would be devastating not only for the periphery but also for Germany. It would leave Germany with large unenforceable claims against the periphery countries. The Bundesbank alone will have over a trillion euros of claims arising out of Target2 by the end of this year, in addition to all the intergovernmental obligations. And a return to the Deutschemark would likely price Germany out of its export markets – not to mention the political consequences. So Germany is likely to do what is necessary to preserve the euro – but nothing more. That would result in a eurozone dominated by Germany in which the divergence between the creditor and debtor countries would continue to widen and the periphery would turn into permanently depressed areas in need of constant transfer of payments. That would turn the European Union into something very different from what it was when it was a “fantastic object” that fired peoples imagination. It would be a German empire with the periphery as the hinterland.

I believe most of us would find that objectionable but I have a great deal of sympathy with Germany in its present predicament. The German public cannot understand why a policy of structural reforms and fiscal austerity that worked for Germany a decade ago will not work Europe today. Germany then could enjoy an export led recovery but the eurozone today is caught in a deflationary debt trap. The German public does not see any deflation at home; on the contrary, wages are rising and there are vacancies for skilled jobs which are eagerly snapped up by immigrants from other European countries. Reluctance to invest abroad and the influx of flight capital are fueling a real estate boom. Exports may be slowing but employment is still rising. In these circumstances it would require an extraordinary effort by the German government to convince the German public to embrace the extraordinary measures that would be necessary to reverse the current trend. And they have only a three months’ window in which to do it.

We need to do whatever we can to convince Germany to show leadership and preserve the European Union as the fantastic object that it used to be. The future of Europe depends on it.

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And from todays’s New York Times: “In the United States, the ease of borrowing has not made it politically easier to increase the pace of spending. Instead, there is the possibility of “Taxmageddon,” the threat that the unwillingness of politicians to compromise could lead to a combination of big automatic spending cuts and tax increases in 2013 that could devastate economic growth. All this is taking place in the midst of an election campaign that is widely expected to be the nastiest ever.

Moreover, the consensus that financial regulation should be strengthened and standardized has evaporated. In Europe and the United States, banks say that institutions across the Atlantic have unfair advantages, and regulators complain that the other continent has not taken the needed steps.

In the United States, a major push by the banks to weaken rules may or may not have been badly damaged by the multibillion-dollar trading loss suffered recently by JPMorgan Chase. But many in Congress, primarily but not exclusively Republicans, have gone back to the old belief that it was excessive government regulation that created the problem.

The widespread pessimism could dissipate as rapidly as it accumulated. Some surprisingly good economic news in the United States and China would help. More important would be for Europe’s leaders to reach agreement on a course of action that offered hope for recovery in the most stricken areas of the Continent while assuring that the common financial system would have the support of common institutions if needed. Europe has previously managed to cobble together something when disaster appeared to loom, and perhaps it could do so again.

Germany — the country that would have to pick up most of the bill to rescue its neighbors — could decide that not spending the money created greater dangers. The United States could find ways to help out despite fiscal pressures and Congressional hostility to foreign aid. A new consensus on common bank regulation could emerge. But, for now at least, the outlook is far darker than it seemed to be only a couple of months ago.”

www.nytimes.com/2012/06/03/business/in-economic-deluge-a-world-thats-unable-to-bail-together.html?nl=todaysheadlines&emc=edit_th_20120603

NEWS ANALYSIS

In Economic Deluge, a World That’s Unable to Bail Together

By 
Published: June 2, 2012

Less than four years ago, with the world’s financial system in danger of collapsing, major countries managed to come together on a coordinated course that averted a global depression.

Central banks pumped vast amounts of cash into economies, and banks were bailed out, with vows that they would be subject to stronger regulation.

By early 2009, financial markets had bottomed out and begun strong recoveries. Economies were slower to follow; by last year, slow growth seemed to be the global pattern, spurring hope that the crisis had passed.

But within the last few weeks, much of that hope seems to have faded.

In Europe, the crisis has grown worse, not better, and thedisputes among European leaders have intensified as much of the Continent appears to have drifted into a newrecession. In China, growth remains robust by Western standards. But concern is rising over the possible end of a property boom that had been fueled in part by local government borrowing and spending.

In the United States, which had been an oasis of relative calm with a growing economy and rising employment, job growth in May, reported Friday, was a puny 69,000. To make the outlook even gloomier, earlier numbers were revised lower. That capped a series of three disappointing monthly reports.

Moreover, there seems to be little willingness — or perhaps lit-tle ability — for the major countries to act together again. Squabbles have grown, some countries are in fiscal distress, and others face daunting domestic problems. The European situation is the most pressing. Banks are under pressure in many countries, for a combination of reasons. They did not raise as much capital as they might have when markets were more buoyant last year. In some cases, they appear to have been slow to recognize their real estate loan losses.


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Posted on Sustainabilitank.info on May 25th, 2012
by Pincas Jawetz (PJ@SustainabiliTank.com)


UNIS/OUS/146
25 May 2012
Re-issued as received

Italian agency ENEA and UNIDO to jointly promote renewable energy and energy efficiency in developing countries.

VIENNA, 25 May (United Nations Industrial Development Organization)

The United Nations Industrial Development Organization (UNIDO) and the Italian National Agency for New Technologies, Energy and Sustainable Economic Development (ENEA) have agreed to jointly promote sustainable development by transferring knowledge and technology relating to renewable energy and energy efficiency to developing countries.

Through the new partnership, UNIDO and ENEA will provide expertise to promote energy efficiency in industry and the deployment of renewable energy technology, especially for productive uses, industrial applications, and the development of rural areas.

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UNIDO and ENEA will focus on capacity-building and technology transfer in developing countries, providing technical and professional training and support in the areas of ENEA competence, especially renewable energy and agro-industry.

The two organizations will also identify and promote innovative financial mechanisms to support the deployment of renewable energy technology.

To achieve these objectives, ENEA will involve a range of scientists and laboratories to help improve the quality of human resources in countries where UNIDO activities are concentrated. Through its internet platform, ENEA e-LEARN, the Italian agency provides scientific and technical expertise in the energy field, which is vital for industrial and economic growth in developing countries.

The ENEA internet platform currently provides more than 200 online courses and 300 video classes on topics such as planning and management of renewable energy sources (solar and wind energy), eco-building and new technology. The joint cooperation will enhance the dissemination of the e-learning methods developed by ENEA.

The two organizations also agreed to promote the ENEA project, Education for the future, which aims to improve schoolchildren’s knowledge of sustainable development. The project fosters cooperation and partnerships between Italian and African schools, and will help supply schools in rural areas with electricity using solar photovoltaic sources.

* *** *For more information, please contact:

Mikhail Evstafyev
UNIDO Advocacy and Communications Coordinator
Telephone: (+43-1) 26026-5021
Mobile: (+43-699) 1459-7329
Email: M.Evstafyev[at]unido.org

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United Nations Information Service Vienna (UNIS Vienna)
P.O.Box 500
1400 Vienna
Austria
Tel.: (+43-1) 26060-4666
Fax: (+43-1) 26060-7-5899
Email:
unis@unvienna.org
Website:
www.unis.unvienna.org

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Posted on Sustainabilitank.info on May 21st, 2012
by Pincas Jawetz (PJ@SustainabiliTank.com)

Monday, May 21, 2012

G-8 first-timers Noda, Hollande share concerns over European debt crisis

KYODO

Washington — Prime Minister Yoshihiko Noda shared his concerns about Europe on Saturday with new French President Francois Hollande as fears continue to rear up again about the region’s sovereign debt crisis, the Foreign Ministry said.

Noda, in his first face-to-face meeting with Hollande, urged France and the other eurozone economies to make further efforts to overcome the crisis. Hollande, a Socialist, won the May 6 election by advocating more economic growth.

The two leaders met on the fringes of the Group of Eight summit at the U.S. presidential retreat in Camp David, Maryland. Both Noda and Hollande were making their G-8 debuts.

Noda, who recently called Europe’s sovereign debt crisis the “biggest risk” to Japan’s economy, urged France and other eurozone countries to work together to stabilize the region’s economy.

He also reminded them of the money Japan has thrown their way to combat the crisis, a $60 billion shot in the arm of the International Monetary Fund, and the bonds Japan has purchased from the European Financial Stability Facility, the eurozone’s temporary bailout fund.

Hollande was quoted by the ministry as praising Japan’s help while stressing that Greece must be prevented from leaving the euro. He also said Greece should fulfill its international obligations, a reference to the austerity measures Athens promised in exchange for an international bailout.

During their 30-minute meeting, Noda and Hollande also shared deep concerns about the Iranian nuclear standoff and agreed to deal sternly with North Korea.

As for the issue of Japanese citizens abducted by Pyongyang decades ago, Hollande promised to continue to support Japan in resolving the issue, the ministry said.

Noda also called for France’s help in swiftly launching negotiations on a free-trade agreement between Japan and the European Union, the ministry said.

Hollande showed his support for such an FTA but called on Japan to make more efforts to open its markets to foreign products and services.

In a step to boost Japan-France ties under the new French leader, Noda invited Hollande to visit Japan at an early date.

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Posted on Sustainabilitank.info on May 17th, 2012
by Pincas Jawetz (PJ@SustainabiliTank.com)

There is ‘no need to fear a more federal Europe’

Europe needs to rediscover its élan and purpose or we will sleepwalk into disintegration and disunity – warns MEP and ALDE group leader

11/05/2012

There is ‘no need to fear a more federal Europe.’

by Guy Verhofstadt

Europe needs to rediscover its élan and purpose or we will sleepwalk into disintegration and disunity – warns MEP and ALDE group leader

The French and Greek elections last weekend both delivered a body blow to Europe’s austerity drive designed to rein in national over-spending and reduce the enormous debt mountains that have been accumulating over the past 30 years or more. That Francois Hollande picked up on the anti-austerity theme was probably as much to do with pragmatic politics as ideology. He knows very well that he will not be able to keep all his policy commitments from the campaign trail.

France is not Greece, but it does not have any laurels to rest on either. It was recently downgraded by one rating agency, has high youth unemployment at 25 per cent and a budget that has not been balanced in three decades. That the people voted for a candidate promising a brighter future, reversing pension reforms, creating thousands of new jobs and re-negotiating Europe’s fiscal compact is little surprise – but may shortly be rudely confronted by reality.

At least Hollande is a democrat and a good European. Nicolas Sarkozy was too when he took up office. His interventions in the European Parliament during the French Presidency of the European Union could not be faulted by federalists. And his energy and dynamism were deployed in the common interest. That is until he found himself facing likely defeat to his socialist challenger. He then turned abruptly to the right in a vain effort to woo the voters of Marine Le Pen. Time and again, EU leaders who experiment with populist messages have only served to strengthen – rather than weaken – the hand of the initiators of such messages. In the Netherlands, Finland, Greece and elsewhere – populist, racist and extremist parties have all benefitted from such heightened rhetoric. Why vote for a copy when you can vote for the original?

At the other end of the Mediterranean, the Greek elections delivered an anarchic result in which the two main parties rightly got punished for the decades of corruption and clientilism. But the anti-establishment parties that have reaped the benefit and filled the vacuum have largely vented their anger against the EU and international financial institutions that have imposed tough austerity measures in return for bailing them out from certain bankruptcy. The result leaves no party in Greece able to form a government and everyone promising to voters what cannot be delivered.

So the beleaguered Greek citizen continues to suffer from an inept and self-serving political class that now counts neo-Nazis among its ranks. On the other side of the spectrum is a new far left party, Syriza, which has blatantly and opportunistically capitalised on the country’s woes and the tough adjustment plan imposed by external creditors. It is disingenuous of the party leader to pretend he can tear up the bailout conditions, so painfully negotiated over the last two years, and offer a painless alternative.

The tendency of politicians in both France and Greece to blame foreigners – Brussels bureaucrats or third country migrants – for their country’s travails is a telling indicator that the construction of Europe over the last 60 years still remains a fragile structure that can be so easily and quickly overturned by irresponsible and populist rhetoric – leading to a recrudescence of the kind of nationalism that led us into two world wars, in the first half of last century. Growing Euroscepticism across member states must be countered by a radical renewal of those who are convinced Europeans. We cannot afford to become complacent or indifferent to events that are now shaping public opinion. Europe needs to rediscover its élan and purpose or we will sleepwalk to disintegration and disunity.

Ending the current economic crisis must be everyone’s top priority. No stone must be left unturned in finding a solution, even if that means further pooling of sovereignty. Germany for instance is currently deaf to some practical solutions, such as a European debt redemption fund – which would combine discipline with solidarity – because it fears a loss of sovereignty and accepting responsibility for other people’s debt. But the alternative – never-ending taxpayer funded bailouts – is surely worse.

It is too simplistic and economically nonsensical to argue that austerity is wrong and growth is good. They are two sides of the same coin. Governments cannot invest in growth if they are paying huge interest rates on their borrowing to cover their debts. Annual deficits need to be reined in by reducing unnecessary expenditure so that the resources subsequently liberated can be invested in productive jobs and growth strategies. Some countries have more to do than others in this regard but the rules agreed by European leaders and recently enshrined in a political pact on budgetary discipline remain sensible for long-term budgetary planning.

In this week when we commemorate the speech on May 9, 1950, by French foreign minister, Robert Schuman. The words launched the idea of European integration and pooled sovereignty. His message remains as relevant now as it did then. Europe will not stand still. It will either collapse under the weight of growing nationalism and scepticism or it will recover its sense of purpose, agree to make a qualitative leap in integration in response to the crisis and therefore offer the next generation the kind of peace and stability that we have enjoyed over the past half century. It is not enough to hope that the latter scenario will prevail for there are forces actively working to destroy it. There is no need to fear a more federal Europe, but every reason to embrace it.

Guy Verhofstadt MEP is leader of the Alliance of Liberals and Democrats for Europe group in the European Parliament
 www.alde.eu/press/press-and-relea…

[This article has been also published on PSblicserviceeurope.com and www.EUobserver.com ]

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Posted on Sustainabilitank.info on May 13th, 2012
by Pincas Jawetz (PJ@SustainabiliTank.com)

Greek Tragedy.

By ARIANNA HUFFINGTON
Published, The New York Times as Opinion: May 12, 2012

{please note – she writes this on Mothers’ Day Weekend – and she knows how to write – then she must have inherited as well some genes from her unsuccessful father attempts at owning media. Clearly – for the Greeks it is all in the family – and  EU is not family.}

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As I follow the modern Greek tragedy unfolding in Europe, I flash back to the 18 years I spent in Athens, walking to school in Plaka (the old part of the city), on the same streets that have recently been filled with protesters and violent clashes.

When I was growing up, my family was a tiny microcosm of the current Greek economy. We were heavily in debt; my father’s repeated attempts to own a newspaper ended in failure and bankruptcy. Eventually, my mother took my sister and me and left him. We all lived in Athens and we continued to see my father, though we had our own one-bedroom apartment. (It wasn’t the bankruptcy that got to my mom in the end, but the philandering; “I don’t want you interfering in my private life,” my father had told her when she complained.)

Further austerity was coming, but my mother was clear about one thing: she would cut back on everything except our education and good, healthy food. She owned two dresses and never spent anything on herself. I remember her selling her last pair of little gold earrings. She borrowed from anyone she could, so that her two daughters could fulfill their dreams of a good education — me at Cambridge, and my sister at the Royal Academy of Dramatic Art in London. At the time, Greek girls still offered dowries to be married. My mother used to tell me, “Your education is your dowry.”

As I contemplate the statistics — especially the 54 percent unemployment rate among young Greeks — I think of all the stories behind this appalling data. All the dreams dashed. All the promise unfulfilled. And all the guilt, shame and fear that so often go hand in hand with intractable unemployment and little hope for a better future.

The punitive path of austerity and relentless economic contraction is, not surprisingly, likely to lead to further stagnation in 2013 and cannot be allowed to continue. And as last week’s election results show, the Greek people are not going to allow it to continue; they will instead demand change through either the ballot box or violence in the streets — or some combination of both.

The dangers of violent protest are obvious. But there are dangers in the ballot box, too: an extreme right-wing anti-immigration party received almost 7 percent of the vote, while Pasok, the establishment party of the left, lost 119 seats in Parliament in a humiliating third-place finish. If the European Central Bank does not abandon its destructive obsession with austerity, Greece will have few options but to leave the euro zone. This would be fraught with its own dangers, of course, but the European Union has left Greece with few sustainable alternatives.

Argentina, which defaulted and restructured beginning in 2001, offers a point of comparison. The austerity crowd warned that Argentina would collapse if it stopped pegging the peso to the dollar and defaulted on its debt. There are many differences between Argentina and Greece. But Argentina’s default was followed by a few short months of economic crisis and then many years of steady economic growth — a dramatically different direction than the one Greece is now taking toward a potentially endless path of contraction that is destroying millions of lives and crippling the indomitable Greek spirit.

Yes, the Greeks acted irresponsibly before the economic collapse — the same way my father had acted irresponsibly in his private and professional life. But that is not reason to punish the children, to destroy their future as part of a remedy for a past for which they bear no responsibility.

I spent many nights last summer in Syntagma Square, directly across from the Greek Parliament. The protesting crowd was mixed, full of young people and old, self-employed, unemployed, activists, pensioners. Millions of outraged Greeks — who famously relish connection, expansiveness, intimacy — used social media to connect with the rest of the country and the world; those in the square itself connected and organized the old-fashioned way, face-to-face.

Everywhere waiters, taxi drivers, salespeople, storekeepers, people at the table next to you at dinner, were talking about the same thing. They were — and still are — giving voice to a desire for more say in their own future, a future with more choices than those on offer from the European Central Bank.

When George Papandreou, who was prime minister at the time but resigned last November, visited The Huffington Post newsroom, he expressed the same feelings: “People think they’re being punished unjustly, because they feel they weren’t to blame for this crisis,” he said.

Greece, like my mother, has always been devoted above all else to its children. When the future of those children is diminished, the future — and life — of the country will be diminished, too.

My favorite picture from the protests shows a young man pumping his fist at a line of riot police officers while his mother stands beside him, holding his jacket, to make sure he doesn’t catch a cold. If Greece stays on its current dead-end path of austerity-fueled recession, the children will revolt, and the parents will be right there beside them, cheering them on and watching protectively over them.

And if having a future means leaving the euro, that’s most likely what the Greeks will choose. They invented democracy, and now it’s time to rekindle that Greek spirit of innovation and ingenuity — before economic trouble generates further despair and its dangerous progeny in the streets and in the ballot box.

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Arianna Huffington is President and editor in chief of The Huffington Post Media Group, and author, most recently, of “Third World America.”

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Recent elections in France and Greece pose significant challenges to the strict economic austerity policies Germany has called for in response to the eurozone sovereign debt crisis. Still, Germany has resolutely rebuffed any efforts to alter the European fiscal compact agreed to late last year, explains Council on Foreign Relation’s Sebastian Mallaby. “There’s a battle coming up between Hollande and his European partners as to quite what a growth agenda might mean,” he says. At the same time, the political situation in Greece is “more potentially cataclysmic in its consequences,” Mallaby argues, because it could not only signal a Greek exit from the eurozone, but also undermine European financial institutions and facilitate further sovereign debt contagion.

Voters in Greece rejected the country’s mainstream political parties, and, by extension, the latest EU-IMF bailout. In France, voters elected François Hollande to implement pro-growth policies in a worsening economic climate.What are the implications of these recent elections on EU efforts to resolve the eurozone debt crisis?

In the case of France, what François Hollande has done by defeating current President Nicolas Sarkozy is basically to put on the agenda a “growth pact.”

The question is how to define that rebalancing of European policies away from the austerity formula that has driven it so far.

We suggest – read some of the material that goes into the RioDialogues, throw out the books on Economics 101, and start formulating new economic policies that bring the interest in FUTURE GENERATIONS into your present CURRENT ACCOUNT policies. Oh Well! we know it is hard to create change when under pressure – but talk please to the mothers of Greece as depicted by Arianna Huffington.

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