Month: June 2005

The European Union is a great success story

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The European Union is the biggest and wealthiest continous trade zone in the world, and ten new members joined last year without a hitch. Other countries are lining up to follow, and are doing everything to shape up and meet the Union’s standards. The EU is thereby spreading rule of law and democracy ever wider eastwards. There is a reason why the United States pushes the EU to take in ever more countries, you know.

Now, why don’t I see anyone in the so-called ‘Anglosphere’ acknowledging this success story, instead of endlessly obsessing about its faults?

Hitch’s Journey

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In a panel discussion on the Iraq War, Christopher Hitchens tells the tale of his journey away from the modern International Left, which has become more a party than an ideology, to his chagrin.

Andrew Marr – You, I suppose fell out with quite a lot of people on the left over your support for Iraq and that’s the thing that probably dominates this collection more than anything else …

Christopher Hitchens – … I made a lot of friends on the Iraqi and Kurdish left on the other hand which more than made up for it.

Andrew Marr – But did all of this start with 9/11? Is that the moment of, sort of …

Christopher Hitchens – … Oh, by no means, no. It starts for me at the end of the first Gulf War, the one in 1991, which I was very critical of until the closing stages, when I was in Northern Iraq bouncing around in a jeep with some Kurdish guerrillas. They taped a picture of George Bush senior to their windshield, on my side, so that I couldn’t see out. And after a bit I complained. I said “look do we have to have this, I can’t see” (and also it would be awfully embarrassing if I ran into anyone I knew). I remember that the Iran-Contra business was very vivid in my mind. They said “the fact of the matter is we can move it to a side window if you like, but we think that without his intervention, without the umbrella in Northern Iraq, that we, and all our families, would be dead”. And I realised that I didn’t have a clever answer to that. And I began to re-work back to the origins of the war and realised that co-existence with the Saddam Hussein regime was no longer possible. And that was in 1991. Anyway, if you hadn’t concluded it by then you were obviously not going to be persuaded – as since we have found out.

Hitch has always been an outspoken critic of human rights abuses, and the United States hasn’t escaped his criticism. However, unlike some on the International Left, such as Amnesty International’s Irene Khan, Hitch gets it right when it comes to apportioning blame. He has traveled extensively in some of the hotspots of the world, and as a consequence, he gets an opportunity to see things as they really are. No panty-waisted CNN journo hiding in a safe hotel in Baghdad, he actually spent time traveling far and wide. I’ll take his word over that of the Khans or Galloways of this world any day.

[Cross-posted at Between Worlds]

Quote of the Day

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(5) I was both amused and angered by Justice Stevens’s paean to the democratic process as the appropriate avenue of relief for advocates of medical marijuana at the end of his opinion. Every Justice who joined Stevens’s opinion voted to prohibit states from regulating homosexual sex in Lawrence and [if they were on the Court at the time] voted to limit the government’s power to regulate abortion in Casey. Why was the democratic process not the appropriate avenue of relief for the victims of overzealous government regulation in those cases? It seems we do to some extent live under a system where the personal preferences of the Justices, having nothing to do with the history, text, or logic of the Constitution, dictate when the Supreme Court will or will not intervene to overturn particular regulations.

-David Bernstein, commenting on the Supreme Court’s decision in Ashcroft v. Raich.

One of those voices calling for leaving the Eurozone

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Quite amusing, given the context:

Italy’s labor minister called for a referendum to see if Italians want to temporarily bring back the lira after widespread popular discontent over high prices that many blame on the introduction of the euro.

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A leader of the euroskeptic Northern League party, Maroni appeared to realize his proposal, made in an interview with Rome daily La Repubblica, would be attacked.

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Industry Undersecretary Roberto Cota, also from the Northern League — one of Berlusconi’s main coalition partners — insisted on Sky TV24 news that going back to the lira was technically possible.

When the euro came into circulation, many merchants steeply raised prices on goods and services from fruit and vegetables to plumbing repairs and dining out.

What makes this so amusing is that

a) The Northern League is a coalition of cranks and oddballs whose ultimate goal is the secession of Northern Italy from Southern Italy (how’s that for a meme?)

and

b) Italians and the Italian government are blaming the Euro because Italian merchants used its introduction as an occasion to raise their prices. They’ll use just about anything as an occasion to raise their prices, and it would have been up to Italy to prevent it by proper supervison. It’s too late now anyway, for the merchants wouldn’t take the increase in prices back, even if the Euro would be exchanged for the Lira again. And last but not least: Why is this anybody’s goddamn business except the Italians’, huh?

As it happens, none of the arguments now suddenly brought forth against the Euro are any more convincing than Maroni’s, as I’ll demonstrate in the posts I’m going to put up over the next days.

Some European governments get the vapors, take potshots at the Euro – and miss

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This started out as a comment to Jonathan’s post below, but became too long, so I’m putting it here:

The most important point to remember here is that Europe’s problems are almost exclusively the work of the individual members, and not that of the European Union, which is not a huge disembodied entity, but an organization that can make only such decisions which are approved by all of its members’ governments.

Take the example of Italy: Whenever they ran into problems in the past, they devalued the Lira to make their products more competitive. At the same time imports, especially imports of raw products, and parts the Italian companies need to buy abroad to make their own products, became more expensive. The result was a double-whammy: Increased demand for Italian products and an increase in prices for imports drove up inflation, which in turn led to higher wages and therefore higher inflation. To compensate for these problems, the Italian central bank again devalued the Lira etc, etc, ad nauseam.

This vicious circle led to ever higher inflation, and also ever higher interest rates. Italy gained two benefits by joining the Eurozone: Their inflation was suddenly under control, and they had much lower interest rates. If they had reformed their ruinously expensive social systems, all would have been well, but they didn’t, so that the government now needs a scapegoat. As most governments here do, the EU and the Euro are first choice when it comes to that.

Now to the really sad truth: If Italy hadn’t joined the Euro, it now would be in the same situation Argentina is in – the high inflation and and high interest rates would have dragged it down by now. If they left the Euro, that’s exactly what would happen, only a lot faster – government debt of 106 % of GDP would see to that, if they had to pay the market interest rate rather than the interest rate payable by members of the Eurozone. And if they don’t change their ways, they might even get kicked out.

The problems of France, Germany etc are somewhat different, but these, too, aren`t caused by the EU or the Euro, but rather by the behaviour of the governments in Berlin, Paris etc. It also should be remembered that there are similar, and sometimes even greater, differences in growth and general economic cycle between different regions of the United States, without anybody calling for the abolishment of the Dollar.

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