Thursday, December 29, 2011

Now Synchronize Your Calendars

Set your calendars ahead one day - at least, if you live in Samoa (capital, Apia).

Samoa will have no Friday this month. At midnight tonight, Samoa will leap forward to Saturday, December 31, 2011, skipping Friday, December 30.

This decision reverses the change made July 4, 1892, when Samoa changed its date to conform to the Western hemisphere and have the same date as American Samoa, capital Pango Pango.

This isn't the only recent change intended to conform to practices in New Zealand and Australia, Samoa's closest trading partners. In 2009, Samoa switched to driving on the left side of the country's roads. Among other things, this made it easier for Samoans living in Australia and New Zealand to ship used cars to relatives living in Samoa.

Monday, December 26, 2011

Ghost Of Christmas Past

Today was a lovely Christmas Day. Good friends visited for coffee ( The Bean was closed) and for Christmas Dinner.

It caused me to recollect the first Christmas I remember. It was 1940. My parents divorced in 1938. Mother remarried in August of 1940 to a young soldier in the United States Army Air Corps. We moved from Tulsa to Tampa to begin a new life.

Here I am on the porch of our upstairs apartment with all the Christmas gifts spread out to admire. It appears that two sets of grandparents had a Christmas present competition.

I'm not sure who won the competition, since I don't remember who gave me what gift. But I remember my favorite present. It was the Erector Set leaning against the wall. I spent countless hours building different structures and machines from designs that came with the set.

This was the last prewar Christmas. Never again would there be so many toys.

But I didn't mind. The best thing about Christmas was always the family get-togethers.

By Christmas of 1941, I had a little brother. Oh, yes, and by then we were at war.

Monday, December 19, 2011

Hungary - Back To The Future?

Disturbing post today on Hungary's authoritarian revolution.  It sounds like a more extreme version of what has been happening in Wisconsin, Michigan and other states in the United States.

The post appears on Paul Krugman's web site, but it is written by Kim Lane Scheppele, Director of the Law and Public Policy program at Princeton University.

It sounds like what is happening in Hungary is a reappearance of the kind of authoritarian regime that has characterized Hungary in the past, including the notorious period of Admiral Horthy's dominance from 1920 to 1946. The forms of governance may resemble those of democracy, but the content is increasingly that of authoritarianism.

By the way, Newt Gingrich's recent diatribes against judges would fit right in with the new Hungarian system.

Sunday, December 18, 2011

Vaclav Havel, 1936-2011

A great man died today.

Vaclav [pronounced "Vatslav"] Havel had been a literary figure and dissident under the Czechoslovak communist regime. He spent four years in communist prisons, but managed to inspire a large following through his plays and other writings. He was an eloquent advocate of democracy.

Havel was one of the first spokesmen for the Charter 77 human rights movement (after the abortive "Prague Spring" of 1968), a leading figure in the Velvet Revolution of 1989, the last president of the state of Czechoslovakia and the first president of the Czech Republic. He died Sunday night  at the age of 75 at his country place in North Bohemia. He was one of the greatest Czechs of modern history.

Despite his international prominence and popularity, Havel had become something of a controversial figure in  his own country. Radio Prague has published a detailed obituary, describing Havel's accomplishments and related controversies.

The New York Times has a slightly different take.

A curious feature of most biographies of Havel is that while mentioning that the Havel family was wealthy, that Havel's father founded the Barrandov subdivision and movie studio near Prague, and that the family's property was confiscated in 1948 by the communists, no mention is made of the Havels' activities during the Nazi occupation. In fact, the elder Havel collaborated with the Nazi regime, including producing Nazi propaganda films at Barrandov. Here is one account of that period.

It would be unfair to brand the younger Havel with his family's collaboration (he was only three years old when the Germans invaded Czechoslovakia in 1939), and it is hard to imagine Havel himself as a collaborator. Still, it is curious that Czechs still avert their eyes from some details of that period.

Havel himself, during the communist period, referred to Czechoslovakia as "Absurdistan."

Havel's grandfather developed a Prague landmark, the Lucerna ballroom and theater, near Wenceslas square. One hall is decorated with an ironic sculpture of Wenceslas astride a dead horse dangling from the ceiling.

It's a Czech thing.

Friday, December 16, 2011

A Mug's Game

Starting a war is a mug's game.

This has been true in almost all cases in international wars over the past two centuries. Just think of the examples:

British invasion of the American Colonies after having earlier withdrawn all forces (1776);

Napoleon's invasion of Russia (1812);

Santa Ana's attack on American forces along the Nueces River in 1846 (President Polk provoked the Mexican attack and then took full advantage);

Confederate States of America attack on Ft. Sumter (1861);

Austrian declaration of war against Prussia (1866);

French declaration of war against Prussia (1870);

Austrian attack on Serbia (1914);

Russian attack on Germany (1914);

German attack on Belgium and France (1914);

Italy's attack on Ethiopia (1935);

Germany's attack on Poland (1939);

Germany's attack on the Soviet Union (1941);

Japan's attack on Pearl Harbor (1941);

North Korea's attack on South Korea (1950);

US intervention in Vietnam, Cambodia and Laos (1964).

There are other examples. There are also a few examples of apparent successful aggressive wars, but the more normal outcome is temporary advantage, followed by stalemate or back-sliding.

It is too early to say what the long term effects of our adventures in Iraq and Afghanistan will be.

By the way, soldiers don't start wars. Civilians do that.

Tuesday, December 13, 2011

Mission Accomplished?

Tonight's TV news showed joyous scenes of our military members returning from Iraq to be united with their families.

Those who answer their country's call have every right to be proud of what they did.

Those who sent them into Iraq with the flimsiest of excuses and a bodyguard of lies have nothing to be proud of.

I have not forgotten the air of triumph exuded by the neocons who pushed this policy. From their standpoint, getting the United States to go to war against Saddam Hussein, who had nothing to do with 9/11, was a great accomplishment.

There was no wisdom here.

It is well to turn the future of Iraq back over to the Iraqis. Where will this lead? No one knows. There are those who believe our presence has accomplished little in the long run other than to strengthen the political and military influnce of Iran in the region.

I'm not prepared to accept this view, either. We shall see.

For a cautionary tale, one might read the triumphant celebration of victory penned by the leading neo-conservative, Richard Perle, in USA Today in the spring of 2003:

Posted 5/1/2003 5:44 PM

Relax, celebrate victory

"By Richard Perle
From start to finish, President Bush has led the United States and its coalition partners to the most important military victory since World War II. And like the allied victory over the axis powers, the liberation of Iraq is more than the end of a brutal dictatorship: It is the foundation for a decent, humane government that will represent all the people of Iraq.
This was a war worth fighting. It ended quickly with few civilian casualties and with little damage to Iraq's cities, towns or infrastructure. It ended without the Arab world rising up against us, as the war's critics feared, without the quagmire they predicted, without the heavy losses in house-to-house fighting they warned us to expect. It was conducted with immense skill and selfless courage by men and women who will remain until Iraqis are safe, and who will return home as heroes."

How long is a quagmire? How many lives is a quagmire? How much blood and treasure  is a quagmire?

Election Protest Grantsboro

Yesterday morning the Pamlico County Board of Elections met to complete the hearing on the protest of the Grantsboro election. We sustained the protest and forwarded it to the State Board of Elections for action. The State Board plans to hear the protest on December 22.

Sunday, December 11, 2011

Wealth Comparisons

Here is an interesting graph by Sylvia Alegretto, labor economist. I finally managed to edit the graph down to size. By the way, the Waltons got their money the old fashioned way - they inherited it. Read the article here.

Democracy: What Is The Recipe?

I have spent my adult life in defense of democracy.

Even so, I sometimes find democracy puzzling. What is it, exactly? How do you get it? How do you keep it?

I have some ideas on the subject, which I hope to share from time to time.

The first question to examine is, what is the relationship of democracy to elections?

Can you have democracy without elections? Possibly. There may be other methods of popular choice of leaders than elections. Offhand, I can't think of any historical examples, though.

Can you have elections without democracy? We have seen all too many examples of that.

Tentative conclusion: "popular choice of leaders is a necessary but not necessarily sufficient condition for democracy."

Give it some thought.

Saturday, December 10, 2011

Above Politics

“I don’t want politicians who are ‘above politics,’ any more then I want a plumber who’s ‘above toilets.’”

(Ta-Nahesi Coates)

Future Politics (Not Necessarily Imaginary)

“Young men and women, educated very carefully to be apolitical, to be technicians who thought they disliked politics, making them putty in the hands of their rulers, like always.”

(Kim Stanley Robinson, Red Mars)

Friday, December 9, 2011

Aristocratic Anarchists

“The poor have been rebels, but they have never been anarchists; they have more interest than anyone else in there being some decent government. The poor man really has a stake in the country. The rich man hasn’t; he can go away to New Guinea in a yacht. The poor have sometimes objected to being governed badly; the rich have always objected to being governed at all. Aristocrats were always anarchists.”

(G. K. Chesterton, The Man Who Was Thursday)

Isn't Thanksgiving Over?

Another post from Making Light that I feel compelled to share. I think the insights can be recycled for those who have turkey for Christmas, also. This from November 24:

November 24, 2011

Happy Thanksgiving
Posted by Jim Macdonald at 10:38 AM * 42 comments Q. Why do turkeys go “gobble gobble”?
A. Because they have terrible table manners.
Q, What’s big and green and goes “gobble gobble”?
A. Turkeysaurus Rex
Q. What’s inside a genie’s turkey?
A. Three wishbones.
Q. How many cranberries grow on a bush?
A. All of them.
Q. Why did the turkey cross the road?
A. The chicken gets major holidays off.
Q. What happened when the turkey got into a fight?
A. He got the stuffing knocked out of him.
Q. What does Godzilla eat on Thanksgiving?
A. Squash.
Q. What do mathematicians do on Thanksgiving?
A. Count their blessings.
Q. What always comes at the end of Thanksgiving?
A. The letter G.

Twisted Blogs

One of the delights of reading other people's blogs is the occasional encounter with a telling, humorous phrase. This may even happen in blogs devoted to the dismal science or, worse, to literature.

One such blog is "Making Light." I especially like the column of bon mots at the left hand column of the home page.

The blog's readers contribute some of the most interesting comments I have seen on blogs.

Today's winner (in response to a blog post about Newt Gingrich, Aasimov's Foundation trilogy and Paul Krugman):

"Ein Volk, ein Reich, Ayn Rand."
- Antonia T. Tiger

Thursday, December 8, 2011

Wednesday, December 7, 2011

December 7, 2005

We got a late start from Patuxent River Naval Air Station Marina on December 7, 2005.

We had sold our apartment and moved aboard our boat, a Pearson 390. Destination: Caribbean. First stop: Norfolk.

The weather was ok, but not as fine as we had hoped, and a cold front was on the way. Ice storm cold.

We left after one o'clock (1300), first refueling across the river at Solomons. By sunset, the wind picked up and the temperature was dropping. We kept on under power. The waves grew, and steering was a bit of a challenge with the sea directly astern. By midnight, we were surfing down the leeward side of ever-growing waves.

We could see the lights of Norfolk in the distance. The closer we got to Norfolk, the more confusing the lights became. By 0200 we were in Norfolk ship channel, dodging container ships, barges under tow and Navy warships. We kept on down the channel, entering the Elizabeth River about 0245. Finally, about 0330 we spotted the Navy hospital at Portsmouth, Virginia and worked our way in to an anchorage.

Woke up about 0900, had breakfast and got ready to weigh anchor. The engine started up and ran smoothly. I put it in gear and nothing happened. I finally thought to open the hatch over the engine and watch what happened when I put the boat in gear. No shaft rotation. Shot transmission.

Had the boat towed to a nearby marina and spent the rest of that day and much of the next locating a rebuilt transmission. Wouldn't arrive until the following week. Boat was cold (though we did avoid the ice storm). We decided to rent a car and tour coastal North Carolina while waiting for the transmission.

Just at dusk the evening of December 9th, we reached the edge of Oriental. Saw flashing blue lights ahead. Cautious, we asked a passerby what it was. "Oh, the Spirit of Christmas Parade."

We parked near Hodges and Midyette and watched the parade from the corner of Hodges and Broad. later sampled hot cider, cookies and such like as we strolled around town. Decided to spend the night. Got up on the 10th and were directed to The Bean for coffee and bagels. Met some colorful locals. Liked what we saw.

Went back to Portsmouth to finish having the boat repaired. Sea trials along the way. Finally reached Oriental by boat December 22. By December 27 we were looking at real estate.

We have not yet sailed any further south.

Infamy: December 7, 1941

Seventy years ago today, I was playing with toy cars in the living room of our upstairs apartment in Tallahassee, Florida. just two days earlier, my stepfather, a staff sergeant in the US Army Air Corps, had returned from several weeks at the Carolina Maneuvers. Earlier in the summer, he had been away at the Louisiana maneuvers. My little brother, born in Yazoo City, Mississippi during that absence, was in his play pen.

Suddenly there was a loud knock at the door and landlord announced: "the Japs have bombed Pearl Harbor."

The only thing I didn't understand about his announcement was, what was Pearl Harbor.

The other part of the landlord's announcement was that all military personnel were recalled to their bases. My stepfather put on his uniform and left. We didn't see him for a couple of days. When he returned, it was to pack his foot locker and take it to the barracks.

Not long afterward, we moved into base housing and stayed there until my stepfather received orders to a unit in Mobile, Alabama, to prepare for overseas movement.

None of this was a great surprise. Those who write about the period often emphasize that America was unprepared for war. Not exactly.

Even at the age of four and a half, I understood that we were getting ready for a war. I had seen the evidence with my own eyes. And heard it with my own ears, as we lived next to newly constructed airbases. On our way to Tallahassee from Mississippi, we had traveled along two-lane highways through small towns filled with the moving vehicles of vast convoys. Maybe people in the interior of the country didn't understand what was going on, but it was obvious to those of us in the South.

Tuesday, December 6, 2011

Fourteen Part Message, Dec. 6, 1941

At 7:20 a.m. Saturday, December 6, 1941, a Navy intercept station near Seattle intercepted a message from Tokyo to the Japanese Embassy in Washington, announcing that the situation had become very delicate and that Japan would shortly send a fourteen-part message in reply to Secretary of State Cordell Hull's memorandum of November 26.

Soon afterward, beginning at 8:05 Seattle time, the message began arriving, in Japan's diplomatic code, known to American cryptographers as "purple." The intercept station had received the first thirteen parts by 11:52 a.m. By midafternoon, the thirteen parts had been sent to Washington, where Navy cryptographers (OP-20G) began breaking the message.

The fourteenth and final part was intercepted at 2:38 a.m. Sunday, December 7, decrypted and delivered to the White House about 9:45. At 4:37 another intercept directed Nomura to deliver the message to Hull precisely at 1:00 p.m. Washington time, and an intercept at 5:07 directed the embassy to destroy all remaining codes, ciphers and secret documents in the Japanese embassy.

The embassy had already discharged all of its locally hired typists. While frantically trying to destroy classified material, inexperienced foreign service officers had to type the documents into proper diplomatic form.

They missed the delivery deadline.

Unsuspected by the Japanese, President Roosevelt and Cordell Hull had already read the Japanese response well before Nomura called on Hull to deliver it. Apparently the "time of delivery" and code destruction intercepts were not delivered to the president until after news of the attack had reached Washington, though General Marshall attempted to warn General Short and Admiral Kimmel in Pearl Harbor about the two messages. That communication didn't reach its destination until after the attack.

Pacific Ocean, 6 December, 1941 Heating Up

From: Tokyo To: Honolulu Date: 6 Dec. 41 (Tokyo Date - Honolulu date 5 Dec.)

Please wire immediately movements of the fleet subsequent to the fourth."

From: PEARL HARBOR: Why, How, Fleet Salvage and Final Appraisal, Vice Admiral Homner N. Wallin USN(Ret), Naval History Division, Washington, 1968

From: Honolulu To: Tokyo Date: 6 Dec. 41

1. On the American Continent in October the Army began training barrage balloon troops at Camp Davis, North Carolina. Not only have they ordered four of five hundred balloons, but it is understood that they are considering the use of these balloons in the defense of Hawaii and Panama. In so far as Hawaii is concerned, though investigations have been made in the neighborhood of Pearl Harbor, they have not set up mooring equipment, nor have they selected the troops to man them. Furthermore, there is no indication that any training for the maintenance of balloons is being undertaken. At present time there are no signs of barrage balloon equipment. In addition, it is difficult to imagine that they have actually any. However, even though they have actually made preparations, because they must control the air over the water and land runways of the airports in the vicinity of Pearl Harbor, Hickham, Ford, and Ewa, there are limits to the balloon defense of Pearl Harbor. I imagine that in all probability there is considerable opportunity left to take advantage for a surprise attack against these places. " 2. In my opinion the battleships do not have torpedo nets..."

From: PEARL HARBOR: Why, How, Fleet Salvage and Final Appraisal, Vice Admiral Homner N. Wallin USN(Ret), Naval History Division, Washington, 1968

From: Honolulu To: Tokyo Date: 6 Dec. 41

The following ships were observed at anchor on the 6th: 9 battleships, 3 light cruisers, 3 submarine tenders, 17 destroyers, and in addition there were 4 light cruisers, 2 destroyers lying at docks (the heavy cruisers and airplane carriers have all left). " 2. It appears that no air reconnaissance is being conducted by the fleet air arm."

From: PEARL HARBOR: Why, How, Fleet Salvage and Final Appraisal, Vice Admiral Homner N. Wallin USN(Ret), Naval History Division, Washington, 1968

From: Tokyo To: Washington Date: 7 Dec. 1941 (6 Dec. Washington Time)

Will the Ambassador please submit to the United States Government (if possible to the Secretary of State) our reply to the United States at 1:00 p.m. on the 7th, your time.

From: THE CODEBREAKERS; The Story of Secret Writing, David Kahn, Weidenfeld and Nicolson, London,1967

USS Jenkins (DD-447)

The ship John Bond served in during WWII was USS Jenkins (DD-447), a Fletcher Class destroyer. This was a brand new class, first built in 1941. Jenkins was the third ship of the class, but the first to see wartime service.

Here is a link to a brief summary of USS Jenkins' career.

I have always admired the Fletcher class destroyers, though I never served in one. They were heavily armed, with a main battery of five 5"/38 caliber guns, two five-tube torpedo launchers, depth charge racks and radar-controlled anti aircraft fire control. They were fast and beautiful. Here is a link to a more complete account of USS Jenkins' career.

Isn't she a beauty?

Sunday, December 4, 2011

A Congressional Christmas

This lunatic [Cratchit], in letting Scrooge's nephew out, had let two other people in.  They were portly gentlemen, pleasant to behold, and now stood, with their hats off, in Scrooge's office.  They had books and papers in their hands, and bowed to him.

"Scrooge and Marley's, I believe," said one of the gentlemen, referring to his list.  "Have I the pleasure of addressing Mr. Scrooge, or Mr. Marley?"

"Mr. Marley has been dead these seven years," Scrooge replied.  "He died seven years ago, this very night."

"We have no doubt his liberality is well represented by his surviving partner," said the gentleman, presenting his credentials.

It certainly was; for they had been two kindred spirits.  At the ominous word "liberality," Scrooge frowned, and shook his head, and handed the credentials back.

"At this festive season of the year, Mr. Scrooge," said the gentleman, taking up a pen, "it is more than usually desirable that we should make some slight provision for the Poor and Destitute, who suffer greatly at the present time.  Many thousands are in want of common necessaries; hundreds of thousands are in want of common comforts, sir."

"Are there no prisons?" asked Scrooge.

"Plenty of prisons," said the gentleman, laying down the pen again.

"And the Union workhouses?"  demanded Scrooge.  "Are they still in operation?"

"They are.  Still," returned the gentleman, "I wish I could say they were not."

"The Treadmill and the Poor Law are in full vigour, then?"  said Scrooge.

"Both very busy, sir."

"Oh!  I was afraid, from what you said at first, that something had occurred to stop them in their useful course," said Scrooge.  "I'm very glad to hear it."

"Under the impression that they scarcely furnish Christian cheer of mind or body to the multitude," returned the gentleman, "a few of us are endeavouring to raise a fund to buy the Poor some meat and drink and means of warmth.  We choose this time, because it is a time, of all others, when Want is keenly felt, and Abundance rejoices.  What shall I put you down for?"

"Nothing!" Scrooge replied.

"You wish to be anonymous?"

"I wish to be left alone," said Scrooge.  "Since you ask me what I wish, gentlemen, that is my answer.  I don't make merry myself at Christmas and I can't afford to make idle people merry.  I help to support the establishments I have mentioned -- they cost enough; and those who are badly off must go there."

"Many can't go there; and many would rather die."

"If they would rather die," said Scrooge, "they had better do it, and decrease the surplus population.  Besides -- excuse me -- I don't know that."

"But you might know it," observed the gentleman.

"It's not my business," Scrooge returned.  "It's enough for a man to understand his own business, and not to interfere with other people's.  Mine occupies me constantly.  Good afternoon, gentlemen!"

Seeing clearly that it would be useless to pursue their point, the gentlemen withdrew.  Scrooge returned his labours with an improved opinion of himself, and in a more facetious temper than was usual with him.

John Bond, 1922-2011

They that go down to the sea in ships, that do business in great waters; These see the works of the LORD, and his wonders in the deep.
-- Psalm 107

I wish to have no connection with any ship that does not go fast; for I intend to go in harm's way.
— John Paul Jones 

We all remember John Bond as a golf cart driver and companion of Goldie, the (mostly) golden retriever.

Seventy years ago, John Bond answered his country's call and went down to the sea in ships. Fast ships (destroyers) that went in harm's way.

Once one has been in peril on the sea, there is little in later life that will seem intimidating. And the experience prepares a person to meet life with calm determination. John Bond was such a person.

I admired John's engagement with the community; his determination to keep up with what was going on and to offer his wisdom to anyone who would listen. He would often stop me as I bicycled around the village. He would talk about what was going on at town hall. Sometimes he would relate a bit of local history, always something pertinent to current issues. He was always up to date and full of wisdom.

It seems just a few days ago, but it must have been a couple of months - John drove his golf cart down Academy Street and beckoned for me to come have a chat. We must have talked for an hour, covering the gamut of local affairs. I don't remember the specifics of our conversation, just that I was impressed yet again with his wisdom. Finally, Goldie became bored and John took his leave.

I will always treasure my conversations with John Bond, model citizen. I will miss him.

Saturday, December 3, 2011

Class Differences

One of the delights and frustrations of the internet is that one often receives compelling information or thoughts passed on from some unknown source. It makes footnotes problematic.

Here is one such comment that came my way today. I don't know where it originated. Maybe it is a new apocrypha.


"In the US we are all expected to work. Here is how the system is set up:
"If we are in the moneyed class, we can create toxic assets, sell them to unsuspecting marks, short the market with these same assets, and win billions, while getting tax-payer money from the government to pull our institutions out of disaster. We end up with even more money than before and collect handsome, even obscene, bonuses, while the country gets shafted, the economy takes a dive and millions lose jobs, 401(k)s and homes. It’s called capitalism, the best system in the world for building wealth for the “job creators”. But it might also be called socialism for the corporate caste.
"If we are in the not-so-moneyed class, middle-class people and working-class stiffs, especially the 33% who are poor, should begin to work at the age of nine (or earlier) and start with mopping the floor, checking books into libraries, and various other menial and non-menial tasks. They have no role models who work nor do they know what work means (Gingrich knows that this is a fact, although he won’t reveal his sources). This is called introducing the poor to the work ethic. But it sounds like the 19th century all over again. It’s actually capitalism for the rest of us.
"The Newtster, meanwhile, works hard at influence-peddling and collects his own share of the pie, parlaying his hard-worn insider’s knowledge about government into a method for making his clients rich. But that might be called legalized corruption."

Friday, December 2, 2011

Why Study Economics?

"The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists."

-- Joan Robinson, Economist (1903-1983)

Has Robert Reich Been Reading My Blog?

A recent article by Robert Reich, former President Clinton's Secretary of Labor, calls attention to the history of Republican adherence to Social Darwinism in the nineteenth century. He ties the current policies of the party to that history.

Last April, I mentioned the same phenomenon in my post on altruism and politics. Robert Reich adds some useful detail.

A German's View Of America

Speaking of Germany; here is a link to an article in Spiegel on line magazine analyzing the US presidential election to date The title says it all :

The Republicans' Farcical Candidates

Thursday, December 1, 2011

Europe In Perspective

Lord Ismay, the first Secretary General of NATO, once observed that the purpose of the alliance was to "keep the Russians out, the Americans in, and the Germans down."

That worked for about twenty-five years, but the dynamics of Europe began to change about halfway through the decade of the seventies. Germany began flexing her economic, political and military muscle about that time. General Alexander Haig, Supreme Allied Commander, Europe (SACEUR) from 1974 to 1979, embraced that change by supporting the appointment of a German general as Deputy SACEUR, filling a position vacated by France when they withdrew from the NATO integrated military structure in 1967.

The truth is, Europeans were never as concerned about the Soviet Union as they were about Germany. Admitting Germany into NATO worried the Soviet Union, but in fact it was aimed more at controlling Germany by embracing them than it was aimed at defending against Moscow.

At the same time, Ismay's goal of "keep[ing]...the Americans in..." was to a great extent for the same purpose. Only America could serve as a counterweight to Germany. In addition, persistent animosities among European nations were so strong that only an outside, neutral power (the US) could moderate these ancient passions.

Reading today's headlines, it seems that nothing much has changed in the past three decades. (I served on the staff of the Supreme Allied Powers, Europe (SHAPE) from 1978 to 1981.) Even in the Euro zone, it appears that the United States continues to be a necessary counterweight to Germany.

Is Taxing The Rich A Good Idea? Yes!

The most interesting thing about our current political debate on fiscal policy is that not only Warren Buffet, but the most successful stock market investors (speculators, if you will) all say that the best way to insure the prosperity of the rich is to insure the prosperity of the middle class.

Don't believe me? Check out this article by Nick Hanauer, a venture capitalist who has started more than twenty companies, including He says, "I’ve never been a “job creator,”  going on to explain: "I can start a business based on a great idea, and initially hire dozens or hundreds of people. But if no one can afford to buy what I have to sell, my business will soon fail and all those jobs will evaporate."

Actually, that sounds a lot like Henry Ford, who recognized that if his workers couldn't afford to buy his cars, his enterprise would be in trouble. Accordingly, he paid his workers more than the prevailing wage.

Hanauer drives the point home: "That’s why I can say with confidence that rich people don’t create jobs, nor do businesses, large or small. What does lead to more employment is the feedback loop between customers and businesses. And only consumers can set in motion a virtuous cycle that allows companies to survive and thrive and business owners to hire. An ordinary middle-class consumer is far more of a job creator than I ever have been or ever will be."

In case you still don't agree, he amplifies the point: "When businesspeople take credit for creating jobs, it is like squirrels taking credit for creating evolution. In fact, it’s the other way around.

"It is unquestionably true that without entrepreneurs and investors, you can’t have a dynamic and growing capitalist economy. But it’s equally true that without consumers, you can’t have entrepreneurs and investors. And the more we have happy customers with lots of disposable income, the better our businesses will do.
That’s why our current policies are so upside down. When the American middle class defends a tax system in which the lion’s share of benefits accrues to the richest, all in the name of job creation, all that happens is that the rich get richer."

"And that’s what has been happening in the U.S. for the last 30 years."

The Occupy Wall Street movement has finally figured it out.

Wednesday, November 30, 2011

Debt Ceiling Analysis (Apologies To Sistine Chapel)

Here is a link to an article in GQ magazine with illustrations of the major players in the debt ceiling controversy.  Take a look. How many can you identify?

Tuesday, November 29, 2011

Debt Ceiling Update

Not long ago headlines were screaming about our supposed debt crisis - we had to fix it by taking away benefits for Americans with modest incomes or we are all doomed.

We may be doomed, but not because of the federal debt. Not in the short or medium term, at least.

It is amazing, after all the hype, how little uproar there has been at the failure of the "super committee."

In my view, it would be good to get the debt level down, but by putting people back to work so federal expenditures decline and revenues increase. We need greater aggregate demand and an effective industrial policy as well.

A bigger debt problem is the overhang of private indebtedness. As the most recent data shows, Nonfinancial private sector debt is about 170% of GDP, but is declining. The last time private sector debt exceeded 170% of GDP was at the height of the depression, when it exceeded 230%. At that time, GDP plunged but existing debts retained their nominal values.

The recent decline in debt to GDP ratio is good for individual debtors, but not good for the economy. If everyone tries to pay off their debts at once, the economy will contract.

Unless the Europeans do something different than they have been doing, this seems likely to happen in the Euro Zone. Both economists and investors seem to believe the US economy will follow Europe into contraction.

Monday, November 28, 2011

OECD Joins Critics Of Economic Dithering

Today the Organization for Economic Cooperation and Development (OECD) joined the chorus of economic observers and major players calling for urgent action to put "weakening global [economic] activity back on track."

The OECD calls for action both by Europe and the United States. OECD's latest Economic Outlook report foresees serious risks to the global economy.

OECD Chief Economist Carlo Padoan observes that “Prospects only improve if decisive action is taken quickly.” 

The Outlook’s baseline scenario assumes that policy-makers take sufficient action to avoid disorderly sovereign defaults, a sharp credit contraction, systemic bank failures and excessive fiscal tightening. It sees GDP across the OECD countries slowing from 1.9% this year to 1.6% in 2012, before recovering to 2.3% in 2013. Unemployment in the OECD area is also projected to remain high for an extended period, with the jobless rate staying at around 8% through the next two years.

“We are concerned that policy-makers fail to see the urgency of taking decisive action to tackle the real and growing risks to the global economy,” Mr Padoan said during the launch of the report in Paris. “We see the US  growth recovering only slowly, the euro area entering into mild recession and Japan growing faster because of reconstruction, but this boost is temporary and will fade away.”

Saturday, November 26, 2011

Japanese Carrier Force Gets Underway

Exactly seventy years ago, November 26, 1941, a Japanese carrier force, the Kido Butai, under command of Vice Admiral Chuichi Nagumo, got underway from Hitokappu Wan in the Kurile Islands, under strict and effective radio silence. The force of six aircraft carriers, with 359 airplanes embarked, was the most powerful carrier force with the greatest concentration of naval air power ever assembled up to that time.

Accompanying the force were two fast battleships, two heavy cruisers, one light cruiser, nine destroyers and three fleet (long-range) submarines. An advanced expeditionary force including twenty fleet submarines and five midget submarines, had already departed Japan enroute to the objective area. The force also was accompanied by eight oilers for refueling along the way.

The day the Kido Butai left the Kuriles, Japanese negotiators in Washington received a note from US Secretary of State Cordell Hull proposing a solution to the crisis in the Far East. Japanese leaders dismissed the Hull note as the same old proposal they had rejected before.

Japan had not yet made an irrevocable decision for war. Nagumo got underway with the understanding that if "negotiations with the United States reach a successful conclusion, the task force will immediately put about and return to the homeland." The final decision was to be made early in December.

November 26th was a particularly active day on the diplomatic front in Washington as Ambassadors Nomura and Kurusu frantically sought agreement with Secretary of State Hull. Messages to them from Tokyo (intercepted, decoded and translated by US Army and Navy intelligence) emphasized the importance of oil. Tokyo wanted agreement for the US to supply 4 million tons of oil per year.

Nomura and Kurusu reported diminishing hopes for agreement, and dutifully reported that Hull was meeting with the Chinese ambassador as well as with them. Nomura and Kurusu knew nothing about the Kido Butai's movements.

The clock was ticking.

Spelling Assistance

Those of you who are "spelling challenged" may wish to know that even the venerable New York Times occasionally gets a word wrong. But the "gray lady" knows how to fix it without making a fuss.

Two minutes ago, I was reading the front page of the on-line edition of NYT, adorned with a photo of Governor Rick Perry in his uniform as a Texas A&M cadet. The caption explained that he was in his "core of cadets uniform." I began reading the caption to my wife, to point out the error, and as I was reading it, the spelling changed to "corps of cadets uniform."

No fuss, no muss, just quietly change it. There was not even a strike-through as in "core corps of cadets uniform."

I'm waiting to see if they acknowledge the error.

Friday, November 25, 2011

Euro - The First Decade

Next year will be the tenth anniversary of the introduction of the Euro into circulation.

We were living in Europe (though not in the Euro Zone) at the time. As I recall, the Euro was worth about 85 cents when it was introduced. It was a great convenience to travelers, who over much of Europe no longer had to convert dollars into a dozen different currencies.

But I always wondered how the common currency would work in practice. We now know the answer - not very well.

Unless the Europeans get their act together, the first decade of the Euro may well be the last.

Wednesday, November 23, 2011

Greece, Italy And Now...Germany?

News from Europe isn't improving. Today, Germany attempted a bond auction and couldn't find buyers for about a third of the bonds. Looks like investors are casting a jaundiced eye even on Germany as a safe haven.

In truth, by some measures (primary deficit), Italy is performing better than Germany.

Austerity doesn't seem to be working for anyone. Investors, both in Europe and in the US, seem to be less concerned about deficits and sovereign debt and more concerned about the possibility of further deflation, recession and economic contraction. Americans should worry about what is happening in Europe, because a breakup of the Euro could drag the US economy down with it.

Keep your fingers crossed.

By the way, the US Treasury is having no trouble marketing securities at historically low rates.

So much for Standard and Poor's.

Tuesday, November 22, 2011

Oriental Election Recount

At the request of Mr. Hugh Grady, candidate for Oriental town commissioner, the Pamlico County Board of Elections met today to conduct a complete recount of votes for the commissioner race.  The recount confirmed the count reported after the official canvass held November 15. The bottom line: write-in candidate Warren Johnson defeated ballot candidate Hugh Grady by three votes, to win the fifth seat on the board.


1 of 1 Precincts Reporting
Percent       Votes
Michele Bessette
13.29%        211
Hugh Grady
10.01%        159
Sherrill Styron
20.34%        323
Larry Summers
17.76%        282
Barbara Venturi
16.62%        264
Candy Bohmert (Write-in)
0.63%          10
Pat Herlands (Write-in)
8.63%        137
Warren Johnson (Write-in)
10.20%        162
Jennifer Roe (Write-in)
0.44%           7
Write-in (miscellaneous)
2.08%          33

Monday, November 21, 2011

Have We Put The Fools In Charge?

I keep trying to disprove the working hypothesis that the world is run by fools. I have so far not succeeded.

The Swedish diplomat Axel Oxenstierna formulated the concept some 360 years ago in a letter to his son: "Do you not know, my son, with how little wisdom the world is governed?" (in a letter to his offspring written in 1648, in the original Latin An nescis, mi fili, quantilla prudentia mundus regatur?).

The lament seems to apply most especially to the field of economics. Just this past weekend we have seen the European Central Bank pursuing policies likely to destroy the Euro, after first destroying the individual economies of the Euro Zone. In the US, we have had the failure of the "Super Committee."

The latter failure is just as well. Republicans on the committee seemed bent on destroying the US economy. Whether this is from ignorance, ideology, erroneous concepts, or just to make sure Obama's efforts to put people back to work are obstructed, I can't say. Probably all of the above.

No wonder the powers that be have resorted to violence against the Occupy Wall Street movement. OWS was beginning to figure out how the system works.

Sunday, November 20, 2011

American Exceptionalism?

Were the police on the campus of the University of California, Davis, exceptionally annoyed? Perhaps they were exceptionally incompetent.

One of the mysteries of the Occupy movement is how, from coast to coast, authorities have acted with disproportionate force to a petty annoyance. A justified petty annoyance, at that, but it hardly matters.

Just more evidence of how little wisdom informs the world's governance.

Saturday, November 19, 2011


Today we attended the 16th Annual American Indian Heritage Celebration in Raleigh.

It was a lovely day for a beautiful event.

We usually think of Indian country as being out west. But North Carolina is Indian country, too. Our state is home to some 122,000 Indians, by US census count - more than any other state east of the Mississippi.

The two largest tribes in NC are the Lumbee and the Cherokee. The NC Cherokees, known as the Eastern Band of the Cherokee Nation, have a particularly sad but heroic history. The Eastern Band are descended from those Cherokees who evaded US and state militia troops bent on rounding them up in the late 1830's and forcing them along the Trail of Tears to Oklahoma.

Resisting a century and a half of efforts to take away not only their lands and possessions, but also their customs, religion and culture, the Cherokee have survived. But today's observance was not a lament - it was a celebration of the strength and beauty of a culture that survived.

At one point in the celebration, young girls from each of the tribes in North Carolina, each dressed in elaborate and lovely native dresses, introduced themselves to the audience. The four Cherokee girls introduced themselves in fluent Cherokee before translating what they had said into English. An impressive accomplishment for a people whose language they had been forced by authorities to forget.

But the language hasn't been forgotten. So long as members of the tribe speak the language, so long as they keep their the tribal customs, so long as they pass down the traditional stories and share the life of the tribe, the nation will survive.

Friday, November 18, 2011

But Officer, I wasn't Much Over The Speed Limit

Two months ago, scientists reported that a packet of neutrinos (don't ask) traveled 450 miles from the high energy physics laboratory (CERN) near Geneva to the Italian laboratory at Gran Sasso, faster than the speed of light.

The experiment has been somewhat improved and tried again, with the same results. The packet of neutrinos traveled the 450 miles and arrived 62 nanoseconds before a beam of light would have arrived. How fast is that?

Admiral Grace Hopper, a pioneer computer scientist, used a visual aid in her lectures to show students how long a nanosecond is - that is, how far would a pulse of light travel in a nanosecond. She would hold up a length of copper wire 11.8 inches long. That's a nanosecond.

So the neutrinos exceeded the speed limit by about 62 feet.

Not much, but enough to shake up the world of high energy physics.

CERN is using their new Large Hadron Collider, completed in 2008 - 2009, for high energy experiments. The LHC is about a third of the energy level of the United States' Superconducting Super Collider (SSC) near Waxahatchie, Texas, which was cancelled by Congress in 1993 as it neared completion. Had SSC been completed, it seems likely that the new discovery might have occurred a decade earlier in the United States rather than in Switzerland.

Thursday, November 17, 2011

Vegetable Patch Diversity

I'm planning to put in a garden this spring. All the usual vegetables: corn, beans, cabbage, broccoli, beets, carrots, radishes, lettuce, tomatoes, pizza.

Anyone able to recommend a good seed catalog?

Seventy Years Ago Japan Underway

Seventy years ago yesterday, the first Japanese naval units scheduled to join the attack on Pearl Harbor, slipped out of their home ports. These were the fleet submarines assigned to patrol around Pearl Harbor in advance of the air attack. Some of the submarines carried midget submarines to be used in the final hours before the attack.

The Kido Butai, the Japanese navy's main battle force of six aircraft carriers, remained in the Kurile Islands, undetected by the US Navy's communications intelligence specialists.

Negotiations continued in Washington.

Wednesday, November 16, 2011

Elections - Not Over Yet

Late last summer the County Board of Elections attended two days of training in Raleigh. Among the things we learned: the General Counsel of the State Board of Elections informed us that historically, there are more election protests and challenges in odd year elections (municipal election years) than in even year elections, when more eminent officeholders and aspirants seek election.

The explanation: perhaps familiarity breeds intensity.

So far in Pamlico County, elections protests are proceeding quietly and politely. Next Monday, we meet for a preliminary hearing on a protest of the Grantsboro election. On Tuesday, we meet to commence a recount of the election of Oriental town commissioners. The margin between commissioner Johnson's vote for another term and candidate Grady's vote is three votes. That is less than 1% and therefore qualifies for a recount. This is the third election in a row that the fifth seat in Oriental has been within three or fewer votes, including one tie.

The next time someone says to you, "oh, my vote won't count," let them know that sometimes it counts for a great deal.

And never forget: in a democracy, there are no unimportant elections!

Monday, November 14, 2011

On Understanding Herman Cain

Never mind.

Super Committee Discussions

If you want to know what's really going on inside the Super Committee working on the nation's budget, here's an insight:

Raising Cain

I didn't watch last weekend's republican debate, and no new polls are out yet. Still, one of the surprising results of polling to date is the continued strong showing for Herman Cain.

I just came across a blog post from a couple of weeks ago by Bruce Bartlett, an experienced republican operative, titled "The Secret of Herman Cain's Success." It is worth reading, for the view it gives of the post-civil war history of partisan leanings by African Americans.

His post includes useful reminders of the history of the Democratic Party as a pro slavery party and a racist party for a century after the Civil War. I think he gives insufficient recognition to support of some white southern democrats during this period for economically progressive and populist measures. I totally reject Bartlett's view that republican policies at the present time are at all beneficial for racial minorities or anyone else not in the top one percent economically. Herman Cain, of course, is in the top one percent.

If you read Bartlett's post, be sure to read the comments. They contribute a lot to understanding the context.

I'm working on my own detailed critique of Bartlett's views.

Sunday, November 13, 2011

Mario Monti, Technocrat, To The Fore

So now, at the insistence of Brussels technocrats, economist Mario Monti has become Prime Minister of Italy.

This completes the process begun in the 1980's and 90's when Italian technocrats, briefly in control of Italy's government, sought to exchange Italian economic independence for German central bankers.

There were many economists who warned that a plan where countries had to borrow money in someone else's currency would eventually not work.

Eventually may be this year, next year or the year after, but looks like sooner rather than later.

Many Italians cheered the departure of Berlusconi and the arrival of the technocrats. Lat's see what they say a year from now.

Businessmen In Government

For those pining to turn government over to a businessman to run, I have a one-word response: Berlusconi!

Saturday, November 12, 2011

So How's The Football Team Doing?

I confess. Over the years, I have enjoyed watching college sports. When I was a student at Ole Miss, I even watched some of the games from the sidelines, wearing a press pass and carrying a 4x5 Speed Graphic press camera. I can still, fifty odd years later, give a rousing "Hotty-Totty," the Ole Miss cheer.

But I never understood what big time college sports have to do with education. Lately, I have to conclude that college sports interfere with education.

Last September, I received a weird e-mail from the Chancellor of the University of Mississippi complaining about "anonymous, malicious and public attacks" on the athletics director, including threats on the chancellor that it "will get real ugly" if the director isn't removed. A month later I received an e-mail from an organization seeking my support in their effort to get rid of the athletic director. Earlier this month I received a letter informing me that both the football coach and the athletic director have resigned.

All of this came to mind as I heard the news about Joe Paterno and the Penn State football team. Plainly in both cases, the tail is wagging the dog.

I imagine few members of the public in either Pennsylvania or Mississippi know the name of a single college professor or the head of the institution, but they know the name of the coach. And to most of them, the most important fact about a public university is the football team's won-loss record.

In the face of this set of priorities, any talk by our political leaders of a need to improve higher education is whistling in the wind.

The distortion of priorities starts well before college. This morning I read that a group of high school parents has filed a suit in New Mexico seeking to insert their high school into the state playoffs. The issue? Game officials started the clock too soon at the end of the game (by three seconds), depriving the team of the chance to kick a forty-one yard field goal and possibly get three additional points in a game they won, that would have improved their ranking enough to make the playoffs.

Does anybody really care about education?

Friday, November 11, 2011

Pamlico County Election Results

For those who want to look at the complete unofficial election results for Pamlico County, here is a link to the State Board of Elections web site. There are still a few provisional ballots to be counted. They will be counted at the official canvass at the Pamlico County Board of Elections office Tuesday, November 15 at 11:00. The count announced at that time will be certified as the official count unless there has been a protest or challenge filed before the canvass.


At the eleventh hour of the eleventh day of the eleventh month of 1918, along the trench line from the English Channel to the Swiss Border, the guns that had first sounded in August, 1914, fell silent. The greatest human conflict up to that time, that set in motion the fall of empires and the creation of new nations, had come to a pause.

The silence of the guns was not because one side or the other had won or lost. There was no surrender. It was only an armistice - a temporary agreement to stop fighting. It was a truce, not a surrender.

Even that truce almost didn't happen. In late October, the German Naval Command, without authority to do so,  organized a final great sea battle with the Royal Navy. They were only prevented when sailor's mutinies broke out in Wilhelmshavn and Kiel. The mutiny grew into a revolution that overthrew the Kaiser and established a republic.

During subsequent peace negotiations, the Western allies treated Germany as a defeated power. John Maynard Keynes, who viewed the punitive provisions of the Versailles treaties as disastrous, wrote a short book, The Economic Consequences Of The Peace, that foretold many of the events that led to the renewal of conflict in 1939.

Still, we continued to celebrate Armistice Day as a day of hope that war would be no more. The custom began of wearing a poppy on Armistice Day, a custom visible at yesterday's session of the British Parliament during the interrogation of James Murdoch.

The wearing of poppies was inspired by the poem, "In Flanders Field:"

In Flanders fields the poppies blow
      Between the crosses, row on row,
   That mark our place; and in the sky
   The larks, still bravely singing, fly
Scarce heard amid the guns below.

We are the Dead. Short days ago
We lived, felt dawn, saw sunset glow,
   Loved and were loved, and now we lie,
         In Flanders fields.

Take up our quarrel with the foe:
To you from failing hands we throw
   The torch; be yours to hold it high.
   If ye break faith with us who die
We shall not sleep, though poppies grow
         In Flanders fields.

Thursday, November 10, 2011

If You Wish Upon A Star

Just came across some amusing observations about libertarians, anarchists and other utopian visionaries in a blog post by Belle Waring. A quote that conveys the main idea:

"Now, everyone close your eyes and try to imagine a private, profit-making rights-enforcement organization which does not resemble the mafia, a street gang, those pesky fire-fighters/arsonists/looters who used to provide such "services" in old New York and Tokyo, medieval tax-farmers, or a Lendu militia. (In general, if thoughts of the Eastern Congo intrude, I suggest waving them away with the invisible hand and repeating "that's anarcho-capitalism" several times.) Nothing's happening but a buzzing noise, right?

"Now try it the wishful thinking way. Just wish that we might all live in a state of perfect liberty, free of taxation and intrusive government, and that we should all be wealthier as well as freer. Now wish that people should, despite that lack of any restraint on their actions such as might be formed by policemen, functioning law courts, the SEC, and so on, not spend all their time screwing each other in predictable ways ranging from ordinary rape, through the selling of fraudulent stocks in non-existent ventures, up to the wholesale dumping of mercury in the public water supplies. (I mean, the general stock of water from which people privately draw.) Awesome huh? But it gets better. Now wish that everyone had a pony."

Wednesday, November 9, 2011

Europe - Is Anybody Watching?

Europe doesn't seem to be getting its act together. The new head of the ECB does look more willing to take action, but the pressure for austerity in the peripheral countries is strong. This seems likely to drag those countries further into debt and economic distress.

I believe this is economic foolishness on a grand scale. These are contractionary policies and European countries aren't going to be able to reduce their debt burden without expanding their economies. The big question is whether they have already entered a death spiral. The Euro zone is looking more and more shaky.

Last month I mentioned that the discussion blaming Greek and Italian debt entirely on improvident actions by Greece and Italy reminded me of discussions in the sixties and seventies about balance of payments issues.

British economist Gavyn Davies makes the connection explicit and clear in a recent blog post "The Eurozone Decouples From the World."

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"It is normal to discuss the sovereign debt problem," Davies explains,  "by focusing on the sustainability of public debt in the peripheral economies. But it can be more informative to view it as a balance of payments problem." I think that analysis is exactly right. He goes on to provide statistics: "Taken together, the four most troubled nations (Italy, Spain, Portugal and Greece) have a combined current account deficit of $183 billion. Most of this deficit is accounted for by the public sector deficits of these countries, since their private sectors are now roughly in financial balance. Offsetting these deficits, Germany has a current account surplus of $182 billion, or about 5 per cent of its GDP."

So what should be done?  If it is a balance of payments problem, Davies explains, "it is clear that there needs to be a capital account transfer each year amounting to about 5 per cent of German GDP from the core to the periphery. Without that, the euro will break up. Until 2008, this transfer happened voluntarily, by private sector flows, mainly in the form of bank purchases of higher yielding sovereign bonds in the peripheries, and to a lesser extent via asset purchases (notably housing in Spain). Since 2008, these private flows have dried up, and in fact reversed, so the public sector has had to step in. It has done so in the form of direct sovereign loans, and more importantly by international transfers which have been heavily disguised within the balance sheet of the ECB. Although disguised, these transfers are very real." What Davies fails to explain as clearly as he might, is that the reason the current account balance is a problem is that: a) the periphery countries don't have their own currency, but are forced to borrow in a currency over which they lack control; b) they are precluded from achieving balance by devaluation (that is, they have a very fixed exchange rate); and c) they still have all of the burdens of sovereignty with respect to things like funding armies, police forces, social programs, etc.

Davies goes on: "The eurozone’s proposed solution to this problem – budget contraction plus economic reform in the debtor nations, with no change in policy in the creditor nations – is very familiar to students of balance of payments crises in fixed exchange rate systems such as the Gold Standard or the Bretton Woods system in the past. It is not impossible for these solutions to work, but they are very contractionary for economic activity, and very frequently they fail. When they fail, they lead to devaluations by the debtor economies, normally because the required degree of contraction proves politically impossible to undertake. That is where Greece probably finds itself today. Others may be in the same position before too long."

Now Davies reaches the crux of the matter. The EU has decreed a punishing regime for Greece and soon will for Italy. It isn't clear how long Greek and Italian voters will stand for the solution. Leaving the Euro zone will not be painless, but it may turn out to be the best solution.

"The reason why the eurozone strategy is so difficult to implement is that both of its required actions are likely to make the European recession worse in the immediate future. This has already become clearly apparent in the negative feedback loops which have developed as budgetary policy has been tightened. None of the austere budgetary plans which have been announced during 2011 will achieve their fiscal targets in 2012 in the context of the recessions which will probably be encountered by many countries, and that includes France. There is no such thing as “expansionary austerity”, certainly not in countries which cannot devalue or reduce their long term interest rates. These countries are now chasing their own tails."

"Less widely appreciated," Gavyn explains,  "is the fact that structural economic reform will also make the recession worse in the next couple of years. This reform is absolutely essential in countries like Italy, which are otherwise facing a future of indefinite stagnation, but IMF research shows that in previous similar examples, labour market reform has initially led to higher unemployment and lower GDP as workers are shaken out of unproductive employment. The IMF warns that these reform programmes work best when economies are beginning to recover from recessions, and when there is scope in government budgets to compensate the losers through tax cuts or other measures of support. Neither of these conditions apply today."

"Is there," Gavyn asks,  "any way of improving the chances of success for the eurozone’s chosen strategy? Theoretically, yes. Germany, as the main creditor nation could choose to grow faster, and accept higher domestic inflation for a while, in order to ease the process of adjustment. In practice, Germany shows no sign of accepting this, but it is the best solution available, not only for the debtor economies, but also for Germany itself."

So the logical conclusion is, if the Euro zone collapses, it should not be Greece or Italy which shoulders the blame, but Germany.