Tuesday, 30 June 2009

Baltic Tigers?

When I first came to Poland there was a lot of talk of tigers, namely Celtic and Baltic tigers. Regional neighbours in the Baltic States and Slovakia, with very liberal regulations and flat taxes, were seen as a model for Poland to emulate. During the last election one of victorious PM Donald Tusk's main promises was to turn Poland into the 'next Ireland'

Of course, we all know what happened next. Following Cliff's law of gravity-- the harder they come the harder they fall-- countries like Latvia, Eire and Slovakia which were enjoying high rates of growth in the good times quickly found the bad times hard going indeed. Anyway, enough from me: here is a real blogger, Łukasz Foltyn, with his take on things....

Evidence that the supporters of neo-liberal economics use demagoguery and lies to win public support for their position is to be found in the crisis of the Baltic States. Not so long ago these economies were held up as a model for high economic growth which liberals attributed to their liberalism-- in particular a flat tax rate. Among advocates of the 'Baltic Tigers' were Leszek Balcerowicz-- the architect of Poland's economic transition and Poland's leading neo-liberal guru. The current crisis, which has seen GDP fall nearly 20%, proves one of two things: 1) That liberal reforms which were responsible for the growth are responsible for the subsequent recession, or 2) that neither growth nor recession were connected to liberalism, in particular with tax cuts or flat tax rates. The second option is better for liberals, although still embarassing for its propagandists. Either they have no idea about how to run an economy--claiming that a flat tax rate led directly to high growth--or they simply decieved the public. It is hard to say which is worse but maybe I'll choose ignorance.....

Growth in the Baltic States was fuelled mainly by foreign investors, mostly on credit. Now, when the sources of credit are drying up due to loss of confidence in eastern European markets, the economies are collapsing. Now we can compare the previous growth with the current recession: Liberalisation and flat tax rates, had nothing to do with the growth (or very little) However, when the global crisis reached the Baltic, liberalism enabled the sudden flight of credit, especially in the form of currency. Restrictions on credit withdrawals were eliminated in the name of "freedom of market decisions" and low taxes led to more consumption rather than investment, as well as making it impossible for the national budget to benefit from the 'good times.'

These facts should compromise Polish liberals, as should the case of the Republic of Ireland: The most liberal economy of the 'old EU', and now suffering the most from recession amongst those countries. Unfortunately, I don't believe that the liberal authorities--"economic experts who know the best way to fast growth"-- will be in anyway affected.. There was Ireland, then the Baltic countries, now they'll find a new model country which currently has low taxes and high growth rates. Then, once again, they will repeat the mantra that the low taxes caused the high growth. Here in Poland, no-one speaks out against this view. Why should they? "Even children in nursery school" know that "flat taxes are good for everything."

Łukasz Foltyn is a blogger on lewica.pl.

Translated (roughly) by Czarny Kot 30/06/09 Source: lewica.pl

A view of the situation in Honduras from a former Salvadorean guerrilla (Rather surprising and very thought-provoking)

Central America is the most fragile region of Latin America; it includes Guatemala-- the bloodiest dictatorship, El Salvador-- the most violent country, two of the three poorest countries--Honduras and Nicaragua and, strangely enoug, the most stable democracy-- Costa Rica. In the 1980s Central America suffered the bloodiest conflict of the whole continent since the Mexican Revolution. Almost one million dead and several millions displaced in a war lasting more than a decade. In those years, the USA tolerated a genocide in Guatemala, occupied Honduras, governed El Salvador, started a war in Nicaragua and ended up invading Panama in 1989.

Central America always had a reputation as a land of frauds, military coups, caudillos, dicataors, greedy oligarchies, assassins and guerrillas. The peace of the 1990s brought the hope of long-lasting democratic institiutions, but the electoral fraud last year in Nicaragua and the recent coup in Honduras give the impression that 'bananna republics' are back in vogue.

Extremely weak states are receiving a simultaneous bombardment of criminal narco-dollars from the USA and ideological petro-dollars from Venezuela. The former buy favours and corrupt, the latter buy political alignments that are destroying the unity of countries: and both are destroying democratic institutions. After the electoral fraud, the government of president Ortega n Nicaragua seems more and more like a resurection of the Somoza dictatorship. Recently in Guatemala a victim accused president Colom of his murder using a pre-recorded video. It now seems as if this was a perverse conspiracy by drug traffikers to bring down the extremely weak government.

In El Salvador, the first Leftist government in its history looks set to become equally weak as a result of the conflict between a president that wants to remain in the Centre Left, like Lula, while his party, FLMN, will do anything possible to align themselves with Chavez. The most explosive situation, however, has occurred in Honduras, where the influence of Venezuela has managed to polarise a party system, with more than one hundred years of history, and has divided Hondurans like never before. The result has been the ousting of president Zelaya by the armed forces with the unanimous approval of Congress, the Supreme Court and all political parties, including the president's own party.

Honduras, a conservative society with a provincial political culture, a long history of coups and a conservative, pacifist Left, was suddenly subjected to debates about the Bolivarian model of constitutional reform, re-election and 21st-century socialism. Fear is the engine of all conflict and Honduras is no exception. The fear produced by the closeness of Zelaya and Chavez led the Honduran political class to do what they know to do in these situations. Legally judging the president would be too sophisticated for Honduras. Now the problem has become much more serious, as a president forced to leave the country in his pijamas never makes a good impression.

Without doubt one must denounce the coup, but the international community should take into account the fact that the authoritarian policies of Bolivia, Ecuador, Nicaragua and Venezuela have become a series of provocations for the conservative and centrist forces throughout the region.
The expropriation of companies, the closure of media outlets, the street-level intimidation, arbitrary judicial decisions, perpetual re-elections and frauds are like gradual coups. The ideological polarisation of Chavism is weakening societies threatened by thousands of gangsters and powerful cartels. Central America could become a bastion of organised crime that gives refuge to mafiosos and terrorists and at the same time generates endemic instability leading to millions of emigrants.

The international community is determined to save the region but the problem is more complicated than it appears. Not only is it a question of violated institutions but also of provocations, fears and reactions which have already been unleashed. The region needs a plan of ideological depolarisation and a plan to defend it. In Central America there have always been wars and revolutions and the demilitarisation of Guatemala handed this country to the drug cartels. The underlying problem is one of the viability of small states with small economies, managed like personal estates by their leaders. Central America would have been better off as a single republic but Britain and the USA went to great lengths to ensure that they would remain divided into banana republics, in order to control them and the Panama Canal more effectively. Now, these states are so weak that they cannot defend themselves and they can be bought by drug lords, such as Chapo Guzman, or by oil-rich dictators such as Chavez.

Joaquin Villalobos, an ex-guerrilla from El Salvador, is a consultant for the resolution of international conflcits.

Translated by Czarny Kot 30/06/09. Source: ElPais.es

Monday, 29 June 2009

They Fuck You Up, Your Mum and Dad....

Shamelessly using the death of Michael Jackson in order to repost the first ever blog thing I wrote, back in November last year. (Just to see how it's done.) What's the connection? Well, both Michael Jackson and Prince Charles are eccentric individuals (to say the least) and neither of them chose their fame and... well, that's about all really.....

Waiting in Vain?

"Es mas dificil ser un rey sin corona que una persona mas normal"-- Shakira Ripoll

It's harder being a king without a crown rather than an average Joe.

Is it? Ask Prince Charles who has just turned 60. Royal birthdays, weddings and the like do not usually interest me in the slightest but Charlie's 60th sees him become the longest king-in-waiting in history.

We often laugh at their strange ways and denounce their unearned wealth and privilege. Quite rightly so. But ask yourself this-- hand on heart-- would you swap places with him? He has spent his entire life just passing time until he can fulfil his destiny, something which will only become possible with the death of his own mother.

I would label myself as an apathetic Republican-- I can't see the point of the monarchy but I can't really see any point in getting rid of it-- but Charles' situation strikes me as a cruel and unusual birthright. His cage might come with wealth, fame and a servant to put the paste on his toothbrush yet a cage it remains. Maybe there is more of a case for abolishing the monarchy on purely humanitarian grounds rather than for political reasons.

As for Charlie himself, he has at least tried to give his life some purpose and has made an effort to leave the world in a better state than it was when he entered it. Some of his ideas and intitiatives are very positive, some are well-intentioned but misguided and others are either charmingly eccentric or downright barmy. But he has ideas. It would be easy for him to follow the example of many in his family and live a life of golf, G+T's and private jets.

So happy birthday Charles. Yes, you are a freak but who wouldn't be in your situation.....