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Monday
26Oct2009

President of the European Council: No to Tony Blair, Yes to Jean-Claude Juncker

Supporters of Tony Blair’s (unofficial) hope to become President of the European Council normally argue that he’s the right man for the job because he’s a powerful, media-savvy and strongly opinionated individual.

These attributes are, however, exactly the opposite of what you want for the new president of the Council, it would be the right attributes for a “President of the Union”, but that is not what the Lisbon treaty has created.

Saw this in the Independent and probably broke some copyright laws adding it to our blog. But i hope that no one will mind.

In other words, there is a massive misunderstanding that the media in the big European countries has fallen victim of: the Council is an intergovernmental body of the Union, it is the place where all 27 national governments get together to try to agree on a variety of different issues. It is not a federal body, like the Commission, where you would need someone to speak with a powerful voice (and the very weak José Manuel Barroso certainly is not the right man for the job, but that’s a different story).

In the Council you need a president who is able to strike a compromise between the Member States, and not a man like Blair, who has proven before (see Iraq war) that he is incapable of (or unwilling to) listening to others.

Maybe Blair should run for Commission president because this institution would need a strong president, something it has lacked since the departure of Jacques Delors.

Another misreading of the Lisbon Treaty is the belief that the new president will have powers. He won’t. It will be the – I love the catchy name - High Representative of the Union for Foreign Affairs and Security Policy, who will have all the powers.

That is a position we should not forget. I personally thought that Britain’s David Miliband would be a great man for the job, but, as we’ve read in the papers, he has rules himself out; however, I do believe that there is a (ever so slim) chance that he might rules himself back in, if Blair were to decide not to run for the job of the President.

I admit, it is easy to just rule out Blair, who, by the way, I only ruled out for the above reasons and not for any ideological reasons. Therefore I decided to also look at who should take the job.

The first person that comes to mind is Angela Merkel – with her love for consensus, accord and compromise. But then, she should be ruled out again because a) for political reasons, the first President can’t be German and b) she just won a national election and is unlikely to swap her Chancellorship for the job of the President.

Another name that has been floating around the corridors of Brussels is, of course, Jan Peter Balkenende, who has been Prime Minister of the Netherlands for the last six years.

Occasionally some have suggested Mary Robinson, who was President of Ireland between 1990 and 1997. Her chances are rather slim though, although she has some supporters that point out how she empowered the post of the Irish President.

Then there is Jean-Claude Juncker, who has been Prime Minister of Luxembourg for nearly a decade and a half. He, I believe, would be quite the right person for the job, having been a key designer of the Maastricht Treaty and EMU and therewith proven his ability to make national leaders find a compromise. His country is also in the eurozone, which most certainly seems like the right thing for the first president.

For the President’s position is that of a skilled coordinator and not a loud individualist, it seems to me that it is Juncker, who is best suited for the job.

Schreiber

 

Saturday
30May2009

How UKIP and Conservatives decrease Britain's EP influence

The Westminster world has gone mad. “Telegraph-Reader” has become the most offensive word in Westminster these days; it even beats “New Labour”.

With the election to the European Parliament coming up, some parties are, however, doing rather well, while the Big Two remain caught up in the expenses scandal. We will see Labour doing terrible badly (maybe having to accept a fourth place, but certainly nothing better than a third), while the Tories will also not be doing too well (but they can still expect a first place).

Unfortunately, UKIP will be doing rather well during these elections. I say unfortunately because this party is campaigning for something impossible. Many UKIP voters will believe that voting for UKIP means voting against the EU, hoping that Britain will leave the EU. But, having Eurosecptic MEPs won’t meant that Britain will leave Europe, it will just mean that Britain will have (even) less influence in the EP. If the voters want to leave the EU they would have to vote UKIP during Westminster election (if Comrade Brown will ever call such an election). The EP however does not have the power to get Britain out of the EU (which of course would also be economic insanity).

Similarly, Cameron’s ridiculous idea of leaving the EPP-ED and form his own little anti-EU group in the EP is bad news for Britain. The new group won’t be able to win any votes in the EP, nor will it be able to veto a Commission on its own; for everything it will need the support of the EPP-ED, which it is unlikely to receive. It is understandable why Cameron runs on the most anti-European ticked in decades: it’s an easy way to reach voters. However, it is most certainly not in Britain’s national interest. It would have been much more helpful, if he had informed his voters of how the EP works and what it does. That would have diminished the UKIP vote and probably allowed him to remain within the EPP-ED which would have helped Britain to have a greater say in EP votes.

Of course no other party has done much either to explain to the voters what the EP is. Same is true for the media (with the exception of the FT).

Considering that EP elections are Proportional Representation elections, there is an actual chance of Labour coming in fourth (by the way, Labour’s good conscience, Polly Toynbee, argues in a good comment for proportional representation in, read more here). It will certainly be an interesting election day. Shame that the turnout will be so very low...

Schreiber

Tuesday
24Mar2009

Tenuous times: Hack-economics

Who knew that the car crash of the last 20 years of economic thought could be linked to so many things. In an effort to keep track of hack-economics reporting, we'll be keeping details of the things most tenuously linked to the economy.

I

This reporter clearly wanted to write for Top Gear but got trappped in the rivetting vortex of management journalism. He then proceeds to get even further carried away with his pointless metaphor! Crash and burn.

Radial tyres and inflation

 

 

Thursday
19Feb2009

Allen "Goldfinger" Stanford

As the President of Antigua and Barbuda called for solidarity today the only thing that bought the island together was queuing outside of its banks. The only consolation was the better weather than Northern Rock customers were exposed to. As the global banking system continues its disastrous freefall have we learnt anything? Here's why someone far smarter than us should have seen this coming: -

Tiny island nations do not make the best banking hubs

Antigua has a population of 82,000 people, to put this in proportion it would only take about 100 Northern line trains to delay them in their journeys. Their financial system accounts for just less than half of GDP. 'Sir' Stanford became a citizen simply to benefit from its lax legislation which allowed his empire to flourish. However, when dealing with something as volatile as the financial system, it's always the islanders and investors that suffer the worst.

A single owner is not always the best choice for a business empire

SS is an entrepreneur in very sense of the word. He uses the fact that his organisation has only one head, him, to allow quick decisions to exploit new opportunities. As the SEC noted his, "close circle of family and friends with whom he runs his businesses" are his only trusted operatives; a system of checks and balances that leaves a lot to be desired. Unfortunately entrepreneurs tend to display other less admirable traits, an unerring belief in their own superiority, a cutting ruthlessness and a belief that the rules don't apply to them. With no-one to stop them the end seems inevitable. He had shown himself to be a womaniser, a gambler who loves taking great risks and a great charmer. His key phrase, "Value for clients" doesn't ring true any more.

Where there's smoke.....

Over the last decade SS and his close associates have been accused of money laundering, spying for the CIA and massive tax fraud. Obviously someone as rich and powerful as SS will attract a lot of attention and some of it bad but given his personality and lifestyle perhaps we shouldn't be as surprised as we are.


Anyone offering higher than average returns, their lying

The allure of easy money is, well all too easy. If someone offers you consistent double digit returns it can be hard to turn down, you always feel it may be worth the gamble. But the first law of finance is that on average you can't win all the time. As with Madoff, who offered even higher returns to fund his Ponzi scheme the house of cards will always come crashing down. Perhaps though it may be wise not to trust people who imply their financial instruments are safer than those of the Treasury.

With enough money you can buy false credibility, but not for ever

As with Madoff, SS was an extremely charismatic person who surrounded immersed himself in society and public life. The public sponsorship of many high profile sporting events and even appearance at the Democratic National Conference allowed him to buy a lot of influence and credibility. He specialised, again just as Madoff did in attracting big name celebrities into his investment scheme. The irony is, after Madoff's pyramid of lies came down, SS had to assure his investors they hadn't lost any money.

Sports clubs will never be too worried where their money comes from

Even before the 1919 baseball Black Sox Scandal sport has attracted the wealthy and the corrupt. The players themselves simply want to play and leave it to a few select money men to source the funds which allow them to do so. Should ECB have taken the money? Surely SS's crimes are no greater than the alleged crimes of the Godfather of English football, Roman Abramovich. In his time, Abramovich has been accused of bribery, corruption, theft, manslaughter and anti-trust law violations.

So...

Every successful investor surely has skeletons in their closet, so who decides who is safe or right, or downright criminal. Should the sports rulers be held responsible, the players, the islanders of AntiguaFranklin where Stanford Investment Bank is based, or maybe the FSA and SEC. How can our moral compasses hold us true in a globalised world?

 

 

Saturday
14Feb2009

News Quiz IV

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