Archiv der Kategorie: politics

compulsory reading, German Politics, quicklink

The Slow End Of German Corporatism

Almost unnoticed by the media, an important part of the medieval remnants of German corporatism was silently buried by the Federal cabinet today.

The ‘Meisterprivileg’ – master privilege – effectively keeping people from opening businesses in a lot of markets – mostly those with medieval guild-predecessors – by handing over the right to grant the permission to do so to the “guilds” of those who already own one. It certainly kept the returns high for those who were in the business and thus it was not too surprising to hear them scream today that increased competition will cost employment.

In the short run, this is a possible scenario. In the medium run, this reform is a major step to help create the sort of entrepreneurial environment this country needs so badly, especially in conjunction with the small business tax simplifications about to be implemented. Go Gerhard, go!

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compulsory reading, US Politics, USA

Conspiracy theories in the FT?

Quite to the contrary argues Paul Krugman in today’s NY Times oped piece – the FT is just waking up to the cold and scary truth of how America is being turned into a “Banana Republic” by a semi-feudalist governmental gang –

“The Financial Times suggests this is deliberate (and I agree): ‘For them,’ it says of those extreme Republicans, ‘undermining the multilateral international order is not enough; long-held views on income distribution also require radical revision.’

How can this be happening? Most people, even most liberals, are complacent. They don’t realize how dire the fiscal outlook really is, and they don’t read what the ideologues write. They imagine that the Bush administration, like the Reagan administration, will modify our system only at the edges, that it won’t destroy the social safety net built up over the past 70 years.

But the people now running America aren’t conservatives: they’re radicals who want to do away with the social and economic system we have, and the fiscal crisis they are concocting may give them the excuse they need. The Financial Times, it seems, now understands what’s going on, but when will the public wake up?”

It is difficult to assess the level of truth in his claims. But his interpretation certainly fits my perception of what’s going on. And if “those extreme Republicans” believe John B. Judis and Ruy Teixeira that demographic trends, especially increasing ethnic diversity among the American electorate, would inevitably lead to an Emerging Democratic Majority it would explain the hurry with which they are trying to grab for their constituency whatever they can get hold of as long as they are in power.

In a way, this is a long-run version of my initial interpretation of the Bush economic stimulus programme as bottom-up redistribution that signalled insecurity about the political consequences of the looming conflict in the Middle East and the prospects for a second GWB presidency (can’t access my archives for the link – I wonder when Blogger is going to be working normally again… the service has really been unreliable lately…).

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German Politics

Even More Zeitenwende

Finally online. In this post, I try to address some of the points raised by the two discussants Markus and Hans ze Beeman with regard to my Zeitenwende entry below.

Is there really a “union demonisation game” going on, as Markus alleges? It would be a very interesting academic question to identify in detail the extent of “responsibility” the unions have to bear with respect to this econom’s problems to adjust to a changing economic climate. But that would be a question that would have to be addressed in a multitude of phd theses in economic history and political science. But that’s evidently a bit beyond the scope of this little blog. But to cut the long story short – here’s what I think.

The union’s involvement in the corporatist decision making process in Germany, directly in institutions like the Federal Employment Office (Bundesanstalt für Arbeit) as well as indirectly through political parties, in particular the SPD, in my opinion allows to assert that their organisational interests in combination with the specificites of the German social security system are indeed to a significant extent responsible for a the German economy’s problems to adjust to changing economic climate. In fact,

What I wanted to say in my first Zeitenwende entry was not that the Unions are the only ones responsible for the lack of flexibility in the German economy. But their sometimes healthy, but these days often unhealthy, class-warfare-reminiscent interventions are part of what I referred to as “failed leadership”.

I don’t see them as a victim of “neoliberal discourse hegemony” [neoliberal has become a rather empty label these days, if there ever was a real meaning to it]. But even if, I don’t think scapegoating them would have negative impacts on their functional role – it is not their wage bargaining function that being scapegoated but their claimed general social policy mandate. The latter is mainly a question of discourse hegemony, in my opinion. I agree that an analytical seperation is difficult – where should the line be drawn? In the end, it probably comes down to the question whether the unions can credibly claim to fill the term “social justice” with a meaning.

For a long time, they could. But now, I am sensing that the balance of power has shifted. This country has been debating these questions for ages. There hasn’t been fundamental growth since 1992. While some said back then what others are saying today, timing is very important in politics, especially, of course, when it comes to such a major social policy overhaul as we will be witnessing soon.

It is certainly difficult to separate signals from noise and echos in this debate, but I sense that the union’s constant opposition in the light of continuing economic gloom has led many people to conclude that they haven’t quite mastered the available figures. An example of what I am referring to is that Germany’s most popular satire programme mad fun of unions in its final episode. I can’t remember a single previous episode in which the unions were dealt with in a critical way. Actually, watching this was the original motivation to write an entry about “the end of an era”. In this respect, Hans ze Beeman has posted a link to some interesting ones generated by a huge internet survey carried out by the consultancy McKinsey & Company.

So I stand by my opinion: More and more people are willing to invest in the size of the pie rather than simply fight about their share.

In the end, as we all seem to agree on the necessity of deregulation, the question of union demonization comes down to one of processual ethics in politics. I would say that it is perfectly in order to use the unions as scapegoats, should that be necessary – others might disagree because they fear that this could be taked too far, thereby seriously damaging the fundamentals of corporatist coopration without any real alternative. This clearly is possible. But I don’t think so.

Sure, in an ideal world, I would prefer to have a Habermas’ ideal speech situation and have everyone agree on what’s necessary for everyone. But – Markus guessed rightly that I would say so – such a world does not exist. And in this world, in my opinion, careful union bashing is just what is necessary now.

PS: The comments are not gone. I just don’t know why Reblogger does not display them. I hope I can fix that later. In the meantime, please find the two “lost” comments below. All others are in the comment section to the first entry.

markus(www) said at 12:20 25/5/2003:

the missing part of your post may make this comment stupid, but I’ll risk it nonetheless: why do we need a scapegoat? why can’t we go about this in a rational way?

as far as I can tell, there are some suggestions from the unions which make sense. For instance, downsizing the about 80.000 tax rules Germany currently has (I got the number from a recent documentary). on the other side, there are restrictions, which hinder the economy, which the unions try to keep and in which the unions truly represent the workers in the electorate. job security for instance. so why is this issue tackled by bashing the unions, instead of entering into a dialogue with the electorate and explaining slowly and carefully, without spin and hype, why this step is necessary. You might say, politics don’t work that way, to which I’d respond we can’t afford the traditional ways of politics any more. To me, the purely party-san style of politics we have now, where each side cries “murder” whenever opposing an unpopular but necessary measure might gain some votes is far more damaging to the economy (basically because I believe it adversely affects the psychological requirements for growth) than the unions. They are of course part of it, playing along, just as e.g. the “Bundesaerztekammer”.

If we agree, that the problem is the electorate’s unwillingness to change the status-quo, bashing a scapegoat won’t help. Sure, those doing the bashing may feel better afterwards, for venting some righteous anger but IMHO it’s just a further distraction from the real problem.

That said, I’d like to add I don’t wholly agree with your distinction between the wage bargaining function of the unions and their claimed genral social policy mandate. Please elaborate, why representatives of a sizeable percentage of the employees cannot adress other issues than wages, like for instance job security, working conditions etc. We certainly both have a gut feeling for the point at which the unions are no longer doing their real job, but I can’t think of an analytical solution to this. Ceterum censeo, your input windows are too small, please change width from 122px to a percentage.

hans ze beeman(www) said at 23:33 25/5/2003:

why is this issue tackled by bashing the unions, instead of entering into a dialogue with the electorate and explaining slowly and carefully, without spin and hype, why this step is necessary

because this has been done ad nauseam. It is not time to ponder, ruminate, explain or discuss anymore, it is TIME TO ACT. And the trade unions today showed what they thought about Agenda 2010, which is NOTHING compared to the necessary future changes: they protested in a fully rational way. I predict there will be a grand coalition at the end of the year, and Schr�der will be gone. This would end the immobility and solipsism of the big parties.

If we agree, that the problem is the electorate’s unwillingness to change the status-quo, bashing a scapegoat won’t help.

Errrm, 75% of Germans according to Emnid want changes. And look at http://www.perspektive-deutschland.de for an intersting picture of public opinion. Personally, I bash the unions because they represent socialism and etatism, which is the contrary to freedom. They hide their socialism under the label of “social justice”, which is even more appaling (the representants of the trade unions are either incompetent or cynical and sardonic concerning the people they claim to “represent”). Just look at the renoveling of the “Betriebsverfassungsgesetz”, which produced larger unemployment because those companies having more than 200 employees must now put up with a “Betriebsrat”. See here: Many companies with 20x employees put some out of job or did not hire new ones to stay beneath the 200 border.

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cinema, compulsory reading, US Politics, USA

Bowling For Criticism

A Canadian article criticising Michael Moore’s film “Bowling For Columbine” has made to the top ranks of the MIT’s blogdex today. It’s easy to see why given the linking-power of anti-Moorians on the web. But they, like most of those getting at Moore miss a rather important point:

“Bowling For Columbine” isn’t a documentary. The film is essentially a sort-of fact based cinematographic, cleverly positioned, political pamphlet. It is a well done, important film – but it is hardly a documentary in the classic sense of that term. It is well worth ciriticising that Moore continually claims it is. But that’s about it.

Moore’s main points are important even if, as the Canadian newspaper Star reports among other points,

“[a]ctor Charlton Heston, the head of the National Rifle Association, did not callously go to Denver 10 days after the shootings simply to proclaim to cheering fellow NRA members that he was going to keep his gun until it is pried ‘from my cold, dead hands.'”

This simply doesn’t matter for the film’s fundamental messages.

Moore claims that there is a much higher (physical, not economic) risk aversion in the US than in Europe which is responsible for a lot of paranoid behavior. I have to say, the highly emotionalised American discourse regarding the dangers of rogue states post 9/11 probably underscores this claim – if you want to see it that way.

Moreover, Moore claims that this higher risk aversion is a consequence of what he claims is the central social cleavage in the US – an unresolved racial conflict based on ritualised and inherited slave owner vs. slave identities. A possible conclusion, which I really cannot really say a lot about. But his claim is – here in the realm of social policy – supported by important allies, as for example this paper by Alesina, Glaeser, and Sacerdote indicates. To them, racial animosity is the principal answer to the question “Why Doesn’t the U.S. Have a European Style Welfare System?”. Charlton Heston somehow made the same point in the film – and, if I remember correctly, that section was not even cut in a particularly distorting manner.

“Bowling For Columbine” is not a scientific elaboration. It is an opinionated, scary, but also entertaining film that expressed some of the fundamental anxieties a non-negligeable part of Americans seems to have with regard to the society they live in as well as an attempt to explain some of the fears the rest of the world recently developed with respect to the former land of unlimited opportunities. And – being cleverly marketed by a director who increasingly presented himself as the bearer of truth in a time when people readily swallowed everything that would “verify” their gut felt opposition to the Texan way of life – the film was turned into a huge commercial success.

Again. It is an important film. It is film whose message deserves to be taken seriously. It is a non-fiction film. But is hardly a documentary in the classic sense. Moore deserves criticism for telling the world it is, but again – that’s about it.

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compulsory reading, Economics, German Politics, Germany

Zeitenwende. End Of An Era.

It took some time and more of their money to make Germans understand.

It took more than ten years of subsidizing consumption and unemployment in a previously bankrupt former communist economy and virtual non-growth to make us see that it is not only necessary to think about the problematic long-term consequences of the current incentive structure in the German version of the continental model of the Welfare State but to actually change them.

It was no joke when, earlier this year, two people working in a zoo, who were fired for grilling the animals they should feed, successfully sued their former employer for a golden handshake. An extreme case, of course, but one indicating rather lucidly what’s keeping Germany from growing (possibly apart from too high interest rates, but that’s another story – albeit a connected one).

For ages, Germany’s consensus democracy was unable to get reforms going because, well, there was no consensus to speak of – whichever party was in opposition made a bet that it would pay off to block government reforms as far as possible because the electorate would not believe change was necessary. Sure, such a perception is partly a consequence of failed leadership. But only to a small part. Because they were right – the electorate did not want to see.

Then Schroeder won the 1998 election, largely because of the implicit promise that he would become the German Blair – that he could transform the German Social Democrats into some sort of NewLabour without the need for a Thatcher or a “Winter of Discontent”. But when he had just won his first power struggle and made the loony left’s star propagandist Oskar Lafontaine quit the finance ministry in March 1999, he realized that the internet bubble induced growth (weak, in Germany, but real economic growth nonetheless) would allow him to put off fundamental reforms and to mend relations with the loony left with even more rigid labour market reforms.

Unfortunately, after the bubble burst, it was too late for reforms that would have paid off for the government in last year’s election. A fiscal expansion was impossible and, moreover, unwise given strained public budgets. So Schroeder had to play the hand he was dealt – rectal rapprochement to the trade-unions, exploiting the flood-disaster in East-Germany, and betting on the public’s opposition to the American stance on Iraq.

Having narrowly won last year’s election, Schroeder knew that he would have to deliver on his 1998 promise, even thought the economic climate was far worse than it was back then. And even if though delivering would probably lead to the most serious conflict the SPD ever had with trade unions which, for no obvious reason given the steady decline in their membership, still claim to be speaking for “ordinary Germans” when it comes to “social justice”. The readjustment of the social security system, as well as the “intellectual” separation of the Social Democrats from the unions – developments that will undoubtedly be beneficial to both the SPD and Germany as a whole – will be a lot harder now than they would have been back in 1994, under Kohl, or in 1998.

The difference is that now, for the first time, a growing majority of Germans seems to be willing to give up something for a risky future benefit – or put differently, a lot more people are scared by what they think could happen to them, their children, and this country, if the social security system is not dealt with right now. Let’s hope it remains this way for sometime. The tough reforms are still out there in the think-tanks waiting to be pasted into bills.

Of course, the loony left is barking and whining about its loss of discourse hegemony on “social justice”. But don’t we all know that dogs that bark don’t bite?

If only because they have lost their teeth.

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compulsory reading, German Politics, Iraq, US Politics

Inabilty? Or Willful Wreckage?

So Colin Powell and the German chancellor tried to look forward, not to explain, and not to complain. And what does Geroge W. do? He behaves like a spoilt kid trying to get even by chatting for fifteen minutes with Roland Koch, the premier of the German state of Hessen, a leading figure of Germany’s main opposition party, the Christian Democratic Union (CDU).

No one would have believed the White House affirmations that the meeting happened “accidentally”, that Bush “just walked in” after a scheduled talk between Dick Cheney and Koch anyway, but in an interview with ZDF television’s afternoon programme “Mittagsmagazin”, Koch was pretty much unable not to smirk when the interviewer suggested that a German state premier hardly gets fifteen “accidental” minutes with the US president. GWB’s childish behavior is good news only for those in the US administration who want to strain transatlantic relations even further, and for Koch, who is said to have ambitions to become the next chancellor-candidate for the CDU instead of the current leader Angela Merkel. It is bad news for everyone else.

Was it inability, or willful wreckage? While some people might be tempted to give Bush the credit of inability, the Involvement of Cheney makes it a lot harder to come to this conclusion. So the chancellor is probably quite right to take this as a serious personal attack that he is unlikely to forgive soon. And he, as the German population, will certainly remember that the CDU has chosen to become a pawn in a game originating in the White House.

But Schröder is not the only who has been embarrassed by the latest Bushism. For Colin Powell and the US state department the Bush-Koch meeting conveys an even more serious message – it confirms again and very visibly to everyone abroad who is actually in control of US foreign policy – that Foggy Bottom doesn’t matter and that Powell’s role has apparently been reduced to that of chief messenger. I wonder how long he will go along.

The Cato Institute’s Doug Bandow wrote in October last year with respect to the transatlantic rift that

“… the [US] administration wants doormats, not allies.”

Today, Bush powerfully confirmed this. And while Schröder has repeatedly stated in the last few weeks that Germany does not wish to be forced to have to choose between its most important allies, the US and France, it looks like the American President is indeed waiting for an answer.

I highly doubt he will like it.

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compulsory reading, Political Theory, US Politics

Veto Players On The Move.

Democracy is a tricky thing. That is true not only for the Middle East, where the current US government claims to be implementing it. That is apparently also true for the current US president’s home state of Texas, where the Parliamentary opposition, more than 50 Democratic politicians, has turned into extra-Parliamentarian opposition by fleeing the state before a crucial vote this week, thereby have bringing the state’s political system to a halt but also creating the profound impression that something is seriously rotten in the state of Texas.

What happened – and what is not going to happen. According to the BBC online –

“The lawmakers left the city of Austin just before a scheduled debate on a controversial rezoning plan for voting districts, which Democrats say will unfairly tip the balance in the state in the Republicans favour. They arrived in Oklahoma, but when Texas sent state troopers to ask them to return, they refused to come back. The Democratic boycott means that the Texas House of Representatives does not have the minimum of 100 members needed for a vote to be held.”

Ah, good old gerrymandering.

The Original Gerrymander'

As old as the American Democracy, and probably a neglected factor in the last, problematic, presidential election in the US. But it’s tough to say something about the electoral consequences of current or redefined state-constituencies without detailed knowledge of the demographic composition and clear evidence whether these group characteristics actually are a proxy for electoral results. In cases where demographic composition is a politically correct term for ethnic or class voting, gerrymandering can have severe consequences, as, say, the creation of Northern Ireland amply demonstrates. But as cross-voting increases, the consequences vary a lot more, and politicians suffer from an illusion of control when trying to design their constituencies. Again, it’s hard to speculate about the consequences without a detailed analysis.

However, if, as the BBC explains,

[t]he Republicans had gained control of the Texas House in November for the first time since just after the US Civil War in the 1860s.”

It seems quite understandable to me that they are trying to change that long-time history of losing by rezoning electoral districts to their benefit. Likewise, taking job-security from Democratic deputies is not likely to make them happy.

While their trip to Oklahoma increases the impression of the US being a Banana Republic in terms of democratic procedures, it is actually a smart move to do so – and just another proof of the unintended consequences of designing institutions. I am pretty sure that collective absence from the state by the minority faction was not something those drafting the Texas House Rules were ever even contemplating. But by taking advantage of that omission, the minority faction has indeed become a veto player, something their presence in the Parliament would not have allowed.

So when the Republican leader in the US House of Representatives, Tom DeLay, states that

“Representatives are elected and paid for by the people with the expectation that they show up to work do the people’s business and have the courage to cast tough votes, I have never turned tail and run and shirked my responsibility”

His anger seems to have blurred his political instincts, for by taking that leave, the Representatives are actually living up to their responsibility. If the Parliamentary rules de facto accord the minority faction a veto right, they would be negligent not to exercise it if necessary.

Whatever the eventual outcome in this redistricting battle, redrafting the Parliamentary rules will likely be up next. So, who knows, maybe this procedural quarrel turns out to become a travel industry stimulus package…

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compulsory reading, media, US Politics

Paul Krugman Agrees With Me

that increased scrutiny of media control issues is one of the major policy lessons of the Iraq war [see my recent post]. In addition, his current NYTimes column, “The China Syndrome“, adds an interesting analysis of corporate regulative bargaining with governments. Whatever your opinion regarding the “biased BBC” – or for that matter, biased German tv – discussion, there is only one possible stand concerning the biased “Fox News” debate. And that alone is quite telling in my book.

The issue is of utmost general importance, but today’s Krugman column has been triggered by yesterday’s presentation by Michael Powell, chairman of the Federal Communications Commission of a US bill to relax regulations on media ownership –

“… that will further reduce the diversity of news available to most people…”.

So if Krugman is indeed right in his assessment that

“[w]e don’t have censorship in [the USA]; it’s still possible to find different points of view. But we do have a system in which the major media companies have strong incentives to present the news in a way that pleases the party in power, and no incentive not to.”

Well, if Krugman is right here, and if it weren’t for the Internet, I guess Gleichschaltung could become a concept more and more people might not just identify with partisan news reporting in the Third Reich.

Seems like the “Land Of The Free” could need some more brave publicists these days when even a Larry Flynt is wasting his time chasing an obscure skin-flick allegedly featuring Barbara Bush (the daughter – not the mother…).

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media, US Politics

Criticising the Critics.

The Washington Post’s Jonathan Chait has written an article critizising liberals for the fact that they are allegedly blinded by Bush-hatred –

“Perhaps the most disheartening development of the war — at home, anyway — is the number of liberals who have allowed Bush-hatred to take the place of thinking. Speaking with otherwise perceptive people, I have seen the same intellectual tics come up time and time again: If Bush is for it, I’m against it. If Bush says it, it must be a lie.”

But that’s not the interesting bit about his article, which is being published in a newspaper that – just a few weeks ago – told those of its readers who disagreed with the hawkish oped-line to shut up. The interesting bit is the following –

“[i]t’s entirely appropriate to question the honesty of Bush’s stated rationale for fighting. After all, the arguments he uses to justify his domestic agenda are shot through with deceit. (Consider his shifting, implausible and contradictory justifications for cutting taxes.) And it’s also true that a few elements of the administration’s evidence against Iraq have turned out to be overstatements or outright hoaxes. So Bush’s claims should never be taken at face value.”

How is that different from the above – “If Bush says it, it must be a lie”? Anyone?

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