Today's Coming Crisis Movie

Wednesday, December 28, 2011

Dear Santa, please get rid of the Euro

On 15 December in London, Phil Mullan took part in the annual Institute of Ideas lecture, an event titled ‘Christmas in Euroland’. An edited transcript of his introductory comments is published below.

Christmas is a time we wish for things. Sometimes, as many a ‘Dear Santa’ letter will testify, these wishes can seem, at least at first, a little outlandish, maybe even utopian. So in good seasonal tradition, here is mine: my wish is for a speedy decision to dissolve the Euro, and for this to happen as part of a political, democratically infused campaign for a stronger, united Europe.

First, a small piece of good news – and to be blunt there’s not a lot of it around when it comes to the Euro, not least as the risk is ratcheting up, on a daily basis it seems, of a re-freezing of the credit markets with bank collapses and an even deeper economic contraction in Europe than is already on the cards. The small positive development I’m referring to was the break-up between David Cameron and the other European leaders recently, because it made the realisation of my wish a tiny bit easier. Whatever his motives, and although probably by mishap rather than intention, Cameron’s veto made a little crack in the whole no-politics, anti-politics regime which so far has dominated the life of the Euro, and especially has characterised the technocratic machinations of trying to save the Euro over the past two years.

These days, bringing politics of any form to bear in the councils of Europe is a good thing in itself. And that’s what we saw at the recent summit: a split, accidental as it most likely was, between an expression of political interest – personified by Cameron’s veto – versus that endemic tradition of bureaucratic Brussels stitch-ups, isolated from people and closed away from accountability, and obsessed instead with technical process and procedures. This aloof approach was epitomised in the summit’s main but so-narrow outcome: an attempt to strengthen the fiscal rules surrounding the existing Stability and Growth Pact.

In any such counterposition between politics and technocratic process, we should always side with national politics, whatever the complexion of the politics, because it at least has the virtue of bringing discussion back closer to people. It makes political debate around alternative approaches a little more open. So, ‘more public politics, no more bureaucratic stitch-ups’ is the parallel wish I’ve added to my Dear Santa letter.

To get back to my initial wish: for an end to the Euro. Of course, to question the survival of the Euro has become a taboo subject, not only in Europe but across the Western world. President Barack Obama, for example, is constantly claiming to the American public that the biggest danger to the American economy is ‘headwinds’ from Europe and the risk of the Euro failing. At least until Cameron’s treaty veto, no Western leader, including, I would stress, Cameron himself, had appeared to countenance that anything should take precedence over ‘Saving the Euro’.

The mainstream position makes it clear that we’re in TINA-land again: ‘There Is No Alternative’ to saving the Euro, everyone says. I want to argue the opposite: that the Euro should not be saved, not because it has recently become no longer worth saving, but because in its specific institutional form this common currency should never have been established in the first place. Read More

Government snipers prowl Homs, Syria

South Korea is the key now that Kim Jong Il is dead

Kim Jong-il is dead. Now, what's going to happen in North Korea? That's the question the world is thinking aloud, trying to peep into North Korea. But they are wrong. They should look at South Korea - what happens next will be pretty much determined by the South Korean government's strategy and its reactions.

With Kim Jong-il no longer around - his death at the age of 69 was officially announced in Pyongyang on Monday morning - many experts will look at China, which has been touted as wielding more influence on the reclusive nation than any other country in the world.

But this time, it's South Korea that holds the key in managing the course of the situation in North Korea. South Korean presidential advisers might see this as an "opportunity". Depending on how they interpret that opportunity, the trajectory of the Korean Peninsula will be dramatically different.

Any thought of "regime change" on the part of President Lee Myung-bak's security advisers will hold more risks to the peninsula than opportunities to goad the country into a soft landing. Read More

Arab league monitors views child's corpse

The Exchange: Currency Wars

"Kim Jong-Un may be even more hard-line"

China Debts Dwarf Official Data With Too-Big-To-Compl Alarms

A copy of Manhattan, complete with Rockefeller and Lincoln centers and what passes for the Hudson River, is under construction an hour’s train ride from Beijing. And like New York City in the 1970s, it may need a bailout.

Debt accumulated by companies financing local governments such as Tianjin, home to the New York lookalike project, is rising, a survey of Chinese-language bond prospectuses issued this year indicates. It also suggests the total owed by all such entities likely dwarfs the count by China’s national auditor and figures disclosed by banks.

Bloomberg News tallied the debt disclosed by all 231 local government financing companies that sold bonds, notes or commercial paper through Dec. 10 this year. The total amounted to 3.96 trillion yuan ($622 billion), mostly in bank loans, more than the current size of the European bailout fund.

There are 6,576 of such entities across China, according to a June count by the National Audit Office, which put their total debt at 4.97 billion yuan. That means the 231 borrowers studied by Bloomberg have alone amassed more than three-quarters of the overall debt. Read More

A Union is Born: Latin America in Revolution

While much of the world is in crisis and protests are erupting throughout Europe and the United States, Latin American and Caribbean nations are building consensus, advancing social justice and increasing positive cooperation in the region.

Social, political and economic transformations have been taking place through democratic processes in countries such as Venezuela, Bolivia, Ecuador, Nicaragua, Uruguay, Argentina and Brazil throughout the past decade, leading to a massive reduction in poverty and income disparity in the region, and a substantial increase in social services, quality of life and direct participation in political process.

One of the major initiatives of progressive Latin American governments this century has been the creation of new regional organizations that promote integration, cooperation and solidarity amongst neighboring nations. Cuba and Venezuela began this process in 2004 with the founding of the Bolivarian Alliance for the Peoples of Our America (ALBA), that now includes Bolivia, Ecuador, Nicaragua, Dominica, St. Vincent’s and the Grenadines and Antigua and Barbuda. ALBA was initially launched in response to the US government’s failed attempt to impose its Free Trade Agreement of the Americas (FTAA) throughout the region. Today ALBA is a thriving multilateral organization with member nations that share similar political visions for their countries and for the region, and includes numerous cooperation agreements in economic, social and cultural areas. Read More

4.6 Magnitude Earthquake SOUTHERN PERU - 29th Dec 2011

A magnitude 4.6 earthquake has struck Southern Peru at a depth of 197.3 km (122.6 miles), the quake hit at 03:32:46 UTC Thursday 29th December 2011.
The epicenter was 38 km (23 miles) WNW of Juliaca, Peru
No Reports of Injuries or Damage at this time

5.5 Magnitude Earthquake PACIFIC-ANTARCTIC RIDGE - 29th Dec 2011

A magnitude 5.5 earthquake has struck the Pacific Antarctic Ridge at a depth of 16.9 km (10.5 miles), the quake hit at 00:30:56 UTC Thursday 29th December 2011.
The epicenter was 1826 km (1134 miles) NNW of Mount Siple, Antarctica
No Tsunami Warning Issued - No Reports of Injuries or Damage at this time

5.1 Magnitude Earthquake TONGA - 28th Dec 2011

A magnitude 5.1 earthquake has struck Tonga at a depth of 238.9 km (148.5 miles), the quake hit at 21:55:43 UTC Wednesday 28th December 2011.
The epicenter was 131 km (81 miles) Northwest of Neiafu, Tonga
No Tsunami Warning Issued - No Reports of Injuries or Damage at this time

4.4 Magnitude Earthquake OAXACA, MEXICO - 28th Dec 2011

A magnitude 4.4 earthquake has struck Oaxaca, Mexico at a depth of 64.3 km (40 miles), the quake hit at 21:45:53 UTC Wednesday 28th December 2011.
The epicenter was 50 km (31 miles) Northeast of Salina Cruz, Oaxaca, Mexico
No Reports of Injuries or Damage at this time

4.5 Magnitude Earthquake SOUTHWESTERN SIBERIA, RUSSIA - 28th Dec 2011

A magnitude 4.5 earthquake has struck Southwestern Siberia, Russia at a depth of 10 km (6.2 miles), the quake hit at 21:35:01 UTC Wednesday 28th December 2011.
The epicenter was 44 km (27.6 miles) East of Saryg-Sep, Russia
No Reports of Injuries or Damage at this time

5.4 Magnitude Earthquake SOUTH SANDWICH ISLANDS REGION - 28th Dec 2011

A magnitude 5.4 earthquake has struck the South Sandwich Islands Region at a depth of 31 km (19.3 miles), the quake hit at 20:32:31 UTC Wednesday 28th December 2011.
The epicenter was 182 km (113 miles) South of Bristol Island, South Sandwich Islands
No Tsunami Warning Issued - No Reports of Injuries or Damage at this time

Chavez: Is U.S. behind bout of cancer?

A day after officials announced the cancer diagnosis of Argentina's president, Venezuelan President Hugo Chavez wondered Wednesday if the United States could be infecting the region's leaders with the illness.

Five current or former Latin American presidents have battled cancer in the past few years, including Chavez himself, who claims to have beaten an unspecified cancer.

Chavez prefaced his remarks at a military event in Caracas by saying, "I don't want to make any reckless accusations," but the Venezuelan president said he was concerned by something he finds "very, very, very strange."

"Would it be strange if (the United States) had developed a technology to induce cancer, and for no one to know it?" he asked.

Chavez cited the revelation this year that the United States, between 1946 and 1948, had carried out human experiments in Guatemala where subjects were exposed to sexually transmitted diseases.

That was 50 years ago, Chavez said. Will it be discovered 50 years from now that the United States was infecting presidents with cancer, he posited?

"I don't know. I'm just putting the thought out there," Chavez said. more

4.3 Magnitude Earthquake PAKISTAN - 28th Dec 2011

A magnitude 4.3 earthquake has struck Pakistan at a depth of 286 km (177.3 miles), the quake hit at 019:18:59 UTC Wednesday 28th December 2011.
The epicenter was 17 km (10.5 miles) Northwest of Baffa, Pakistan
No Reports of Injuries or Damage at this time