Sunday, September 18, 2005

The world is changing. Globalization is here to stay. Globalization essentially got its start in America’s whole-scale subsidization of western Europe in the aftermath of the World War, not only through the Marshall Plan, but also through the opening up of American markets for western European products, in order to bind Europe closer to the US, and to forestall the appeal of communism. America went even so far as to directly subsidize, through the CIA, various social democratic parties in Europe (including that of Finland) in order to split the left. The various social welfare states which received support from these policies (expanding from earlier, but weaker, beginnings) were thus an anomaly: they were born out of the realities created by the artifice of the Cold War. They were only politically necessary; they were not economically necessary.

After the collapse of the Soviet Union, we now have an economic entity in the world which is almost as artificial as that of the Soviets, in the form of the European welfare state. It is an entity which, in its construction, cannot but hoard wealth, in order to survive. It does not act as an economic stimulus to other, less-developed parts of the world, since it is essentially an end-user: no recycling of wealth takes place, as the Europeans fritter away the wealth earned from outside trade by indulging in easy living. And it cannot survive if not for a market for its exports which, by necessity to Europeans, cannot have a welfare state in turn if the European model were to survive (i.e. the less-taxed, cash-flush market composed of the American worker-consumer).

Thus there is exploitation since, ironically, in a globalized world, the fact that some parts get taxed more than others means others get exploited, as the benefits of that taxation is not transferred to others. In fact, high taxation becomes a huge problem, as it winds up restricting global trade, and thus becomes an obstacle to the developing world.

Now, running a trade deficit is not transferring wealth, but the selling of debt instruments certainly is. A trade deficit which is financed by loans from the seller is not exploitation at all: the world is filled with business deals such as these, from car loans from manufacturers, to easy credit terms from banks and realtors. And it has been incredibly useful in helping those who need help – in this case, lifting hundreds of millions of Chinese out of poverty. FDR even had a term for it: “pump priming”, a farming term that referred to water being forced through a pump in order to get it to work. US consumption acts as the necessary pump primer for Chinese growth. The trade deficit, however, could not be financed if not for Asian purchases of US securities. Thus the Chinese and the US have a mutually beneficial relationship – no exploitation takes place. And the Chinese, it turns out, are better than the Europeans in allocating the resources earned in trade, as they don’t fritter away the wealth in easy living, thus increasing the likelihood that the US will have a better trading partner in the future.

Consumption is not a favor one does to someone else, but it is an economic tool, in addition to being an end goal. Its most effective implementation as a tool is realized not by state consumption, but by taxpayer consumption, since outsiders can respond more readily to the tangible consumption needs of consumers, rather than the intangible, untradeable benefits of a welfare state. A taxpayer whose consumption increases because of lower taxes also increases market efficiencies, since the market is always more responsive than the state in allocating resources.

Yet the welfare states refuse to acknowledge the present state of affairs, being ruled by elites who have an interest in maintaining the status quo. So the exploitation continues. However, what we do see rising is a realization that the inequitability of European freeriding cannot be permitted to go on. The justification for the elimination of the European welfare state is there. Whether the extermination process has to happen willingly, or by force, remains to be seen.

Friday, September 16, 2005

This is tremendously BIG NEWS, yet the Main Stream Media has totally ignored it!

I haven't seen any TV news or newspaper cover the story. I just learned about this from the blogosphere.

"Interestingly, these words from Blair, addressing an audience of a thousand at the Sheraton just a few blocks north of Times Square, failed to get any pickup in the media. Even The New York Times, published just down the street, ran a story that dwelt on the star power in the room, including King Abdullah of Jordan, Jesse Jackson, and George Stephanopoulos. "Isn't this awesome?" said one participant, and those words seemed to reflect fully the Times' take on the event."

It's truly flabbergasting that at an event with so many world leaders, where there were so many members of Main Stream Media, the bombshell of a statement by one of the Kyoto Treaty's main proponents doesn't even get a squeak.

Wednesday, September 14, 2005

Are there homeless people in Finland? Of course, for the very same, familiar reasons that there are homeless people in America.

The caption runs something like this:

“A homeless person happened to find herself here in Kaleva one day; she slept long into the day. I’m not sure, but she looks like a woman who’s sometimes seen around the railroad station, whom I’ve christened The Birdlady, as how some Swedish police records named a certain homeless person. This Birdlady also feeds pigeons. Of course I didn’t disturb her, and neither did anyone else. Let the poor one sleep.”

Monday, September 12, 2005

Michael Totten, one of America's most important bloggers, is going to do a very brave thing.

Totten is probably the one blogger with whom I feel any kind of political affinity. A former left-of-center liberal, he was transformed by 9/11, - like so many others - and found himself supporting Bush and the war in Iraq. His blogs are seminal for those who truly seek to understand why Bush won in 2004 (a much better preoccupation than focusing forever on the religious right, which Europeans are so obsessed about).

His most seminal blog entry was one of the first to be picked up by a major newspaper. It is an elegant piece of writing, and captures the dichotomy of contemporary American political stances very well.

Thursday, September 08, 2005

If you wonder how Members of the European Parliament spend their time, take a look at this particular representative from Sweden.

Hat tip: Jussi Salonranta

Tuesday, September 06, 2005

For what it’s worth, New Orleans is America’s Venice. It's main industry is tourism, who flock there because of its historical allure. That same allure also keeps an indigenous city population there; the city has History. But it is also a city whose feasibility is in question; it simply should not be, anymore, as it has sunk into the ground so much that it will constantly have to battle the elements to survive. But the city holds so much allure, especially as a major center for African-American culture (practically the birthplace of jazz) that’s it’s abandonment is untenable.

Thus man tries to fight nature with dams, levees and dikes. And, just like in Venice, and in Holland, dam politics enters the picture. I don’t know how many of you have seen that excellent documentary about the dams engineered to save Venice (with the nice, computer-animated depiction of the dams that would rise from the seafloor, pumped with air, once a storm approaches). The documentarians make the point that the idea, - deemed the best one ? remains just an animation, as it got mired in local Italian politics, with the communist mayorality unable to get the backing of the entire country for such an expensive engineering project. The hope now is that the EU would finally kick in some funds to save Venice; I’m sure Finnish taxpayers won’t mind that one bit.

If we examine the history of the failings for state spending on New Orleans’ levees, then it mirrors in longevity to that of Venice. The debate has stretched for decades, long before this administration, and long before the previous one. The arguments of coulda-woulda-shoulda, of course, enter the picture once the Big One actually happens.

As to all the current political recriminations, that is to be expected. People feel a need to blame authority for every natural disaster. Look how many silly Finns took their anger out at the Finnish foreign ministry, for not being somehow more? responsive? to the tsunami. The ministry’s role in tsunami relief is open to question, but in this case it wound up serving as the needed scapegoat for a public still reeling from the scale of the disaster.

The sad fact is that every one in office at the moment of a natural disaster will be somehow blamed for the natural occurrence. It does not matter that money for the levees were turned down even during the Clinton administration, when there was a budget surplus. And it doesn’t matter that it would take some 30 years to actually update the levees for a category 5 hurricane. People need to find a scapegoat, and the present officeholders wind up serving that purpose.

Now that all the houses in the below-sea level area have been pretty much destroyed, New Orleaners have some new options on the table. The historic district in NO has always been on higher ground than the later development (NO forefathers had experienced enough floods to have the common sense to build on top of landfill). It is the later development that can now be built up, so that residents don’t have to live below sea level. Doubtlessly such a project would take years to develop should it be left for governments. Private developers, however, could do a better job, as they have the necessary capital, and as the storm just provided an opportunity to start with a fairly clean slate.
One of the less-discussed points to the New Orleans fiasco is the reluctance of African-American residents to leave their city, due to their knowledge of the lawlessness in their own neighborhoods. Most people would like to return home as soon as the storm passes, if only to guard them. Looting is a problem in high-crime areas that have experienced some sort of an upheaval. It happened in the NYC blackout of 1977, when the crime rate was quite high, - but did not happen in the blackout of 2004, with a much lower crime rate.

Crime in NO had been rising, defying the general national trend of declining rates in recent years. A lot of analyses and studies have been made as to why, but the one single factor is the reluctance of African-Americans to accept jobs in law enforcement in their own communities, even when the city government is basically all black, and even when affirmative-action policies are in place. This ingrained cultural attitude, - that law enforcement is essentially an obsession of white people, and very few want to join the side that is habitually regarded as inimical to their concerns, - is all the more baffling when statistics show that African-Americans constitute a greater proportion of the criminal population in America, but at the same time the greatest number of crime victims are proportionally African-Americans, too.

In the end, it is freeriding at its worst: a community refuses to participate in the odious tasks of self-management, in order not to lose their status as a class always in opposition to management. It is, actually, a stance engendered by welfare. And welfare, as we all know, makes people less prone to take personal responsibility for their decisions.

I like to follow African-American politics, if only to get clues as to how an underclass that has suffered great historical wrongs can be co-opted into a position where it can thrive with the rest of society. If it could be done more successfully in America - where such an underclass was historically the most opressed in all the world - then lessons from such an experience could possibly be applied to other parts of the world.

The most significant recent development in my mind is the emergence of two factors: the African-American Republican, and the influx of recent African immigrants, mostly from West Africa. If you haven’t noticed, “native” African-Americans tend to resent the influx of these new immigrants, who tend to be - just like all immigrants - very hard working and very civic-minded, if given the chance. These two new forces might actually cause some major changes in the domestic political platforms of the African-American community, perhaps to the point where some of the damage done welfare-statist policies of previous decades can be undone.