Newsnotes 2009 12

Notes On The News

by Gwydion M Williams

The Rise and Rise of the Tobin Tax

High Street Standardisation [Chain Stores]

Election Round-Up [Romania, Honduras, Brazil, Bolivia]

Nepal: the unmentioned crisis

Carbon Privilege

Truth Is Often Intolerant [Climate Change]

 

The Rise and Rise of the Tobin Tax

Money is there to allow goods and services to be exchanged easily, outside of existing social ties. That makes it a profoundly radical force, regardless of the wishes of those who use it. In a society dominated by money, social ties become optional and social control is lost. And this happens indiscriminately, all social controls and not just the items that any particular person might wish to be rid of.

Most people who spend a lot of money or who control a lot of money don’t like radicalism, but that’s not the point. Smokers are not in favour of lung cancer and drunk drivers are not in favour of road accidents. But wishes and intentions count for little unless they translate into some sort of action. Making some sort of sacrifice, most of the time.

Someone once remarked that farmers were typically conservative because they were in a world of constant change and did not want any extra uncertainty. It would be even more true of those who make their living from money.

Money has no real mysteries, it is an agreed set of social relationships. Mysteries arise from the humans in charge of money, or rather those in charge of lending it out. Central to lending is a human relationship, is this person ‘credit-worthy’? If not, is there still a good chance of making money?

The devotees of Magical Mystical Money insist that their own business is vital to the world’s welfare and must not be interfered with. This view became popular in the 1980s – the old morality was no longer believed in, but attempts to build a new morality hadn’t gone all that well and were bogged down in disputes about what the new morality should be.

Events drifted – Thatcher and Reagan talked tough but were never that much in control. Several things seemed to go well for them – the Cold War ended in the West’s favour. Japan ran into an unexpected economic crisis just at the moment when some people in the West were thinking of defining Japan as the new enemy. China and the Republic of India were rising steadily, but both had relaxed some of their economic controls, and were assumed to be heading for a Western-style system.

Things began to shift rapidly after September 2008, when the bankruptcy of Lehman Brothers turned the already-serious crisis in Subprime Mortgages into a full-scale disaster that would have brought down the entire banking system if ‘free market’ rules had been followed. Governments had to step in and the illusion of ‘free markets’ got exposed.

‘Feed the Rich’ policies and deregulation had let financiers create financial voids to boost share price and justify bonuses. Now the voids have to be filled, no choice. People’s ordinary money has been mixed with the speculation so that there’s little alternative but to support it all.

One way to stop it happening again would be a ‘Tobin Tax’. A fixed percentage charge on all transactions, meaning that speculation becomes less profitable. Gordon Brown had been against them for years, but in November he suddenly switched:

“Mr Brown said the International Monetary Fund would review the possibility of a global transaction tax and report back in April next year — signalling the G20 had agreed as a group to take up the matter more seriously….

“Britain has repeatedly rejected a long-standing idea for a so-called Tobin Tax on cross border foreign exchange transactions.

“G20 officials said the levy mentioned by Brown would be broader and could be on all financial transactions or bank earnings. The levy would be small, perhaps around 0.005 percent, much lower than a Tobin Tax.” [A]

He’s not alone in this, the idea is being taken much more seriously than ever before. It seems likely that nothing will happen during the current crisis: the USA is still committed to the Reagan notion of less taxes and a small state. Cameron and the Tories are likely to win the next British election on the same basis. But the wider world is changing and the era of Anglo hegemony is clearly drawing to a close.

[Sadly, right-wing propaganda and the 1960s legacy still make state control of finance unpopular in the West. The speculators have been stuffed with public money and seem certain to have at least one more bout of anti-social finance as a marginal recovery occurs.]

 

High Street Standardisation [Chain Stores]

“Music, games and books retailer HMV has said its losses have shrunk as competitors run into trouble.

“The company’s pre-tax loss shrunk to £24.9m for the 26 weeks to 24 October, compared with a loss of £27.5m in the same period last year.

“It has converted 32 stores of former rival Zavvi, while Borders, competitor to HMV’s books chain Waterstone’s, recently went into administration.”

Waterstone’s was “founded by Tim Waterstone after he was sacked by W H Smith. In 1989, W H Smith took a share in the chain, and Tim Waterstone sold out to them in 1993. In 1998, Smiths sold the chain for £300(along with private equity firm Advent International) to HMV Media (now HMV Group plc), a new venture in which EMI was a major shareholder and which already owned the rival Dillons chain.” [N]

Whatever the original intention, the big chains have imposed themselves on books and music. There is less and less choice.

The more people allow money to dominate, the more life will feel unrewarding for most people. In the name of the Free Market, people find changes happening all around them with no way for them to control events.

 

Election Round-Up [Romania, Honduras, Brazil, Bolivia]

Romania has just followed the standard pattern of a bad-tempered election followed by accusations of fraud. The only difference is that the Centre-Right is the official victor and it is the Centre-Left that is making the protests. The official result is very close and exit polls indicated the opposite result.

Always supposing they get over that, Romania’s multi-party politics is currently unworkable, with Social-Democrats balanced against two sets of liberals who are bitterly hostile to each other. President Basescu’s Liberal Democratic party are at odds with Antonescu’s National Liberal party:

“International observers said the vote largely met their standards. But social democrat officials contested the result, saying that with only 70,000 votes dividing the candidates there was scope to manipulate the outcome, for example in mishandling 138,000 void ballot papers….

“Mr Geoana’s social democrats and Mr Antonescu’s party would together have a parliamentary majority. By contrast, Mr Basescu’s parliamentary allies, the democrat liberals, lack a majority and the president’s uncompromising approach has alienated potential allies. Mr Basescu has already failed twice in appointing a post-Boc government. If he fails twice more, he has the right to call parliamentary elections.” [B]

Meantime the USA has got what it wanted in Honduras, the original ‘Banana Republic’ and still under US domination. President Manuel Zelaya had been duly elected and was ousted in a coup that the USA raised no objection to. Now they’ve managed to carry through another election and get someone compliant.[C] But it makes a mockery of US claims to be the champions of democracy.

They don’t like democracy when it produces a government that won’t go along with SubAmericanisation, the attempt to drag everyone into a globalisation run by the USA on whatever rules the USA chooses to lay down. But outside of Honduras, their control is slipping. In Uraguay, a left-wing President has been succeeded by another left-winger, Jose Mujica. Remarkably, Mr Mujica was one of the Tupamaros urban guerrillas in the 1960s.[D] He’s not the only one: President Lula in Brazil has chosen a former Brazilian urban guerrilla, Dilma Rousseff, to be his party’s candidate in the Presidential Election of 2010.[E]

Things are also going well in Bolivia. President Evo Morales has been returned with an increased majority, according to exit poles. He is Bolivia’s first indigenous president, part of the general rise of Native Americans in Latin America, where descendants of European settlers had traditionally dominated. The surprising thing is that they were inert for so long: they remained either the majority or a large minority in many of those countries.

“Exit polls suggest that Mr Morales’s party, the Movement to Socialism (MAS), has won at least 24 seats in the new 36-seat senate, which would give him a two-thirds majority.

“However, it is unclear if the MAS has won enough seats in the new Chamber of Deputies to win a similar majority and ensure an easy passage for the 100-plus laws necessary to fully implement a new constitution.

“Final official results will be known later this week…

“The preliminary results suggest that the MAS has increased its vote in the wealthier eastern departments, where the opposition to President Morales has traditionally been based.

“In the Santa Cruz department for example, exit polls suggest that Mr Morales’ party increased its vote to 40% from 33% in 2005.

“In Tarija, Beni and Pando, MAS also improved its vote significantly.

“According to Oxford Analytica, a research organisation, the degree of support in these areas ‘means that the prospect of secession is ever more remote’.

“In 2007 and 2008 there was considerable speculation that Santa Cruz and other departments might break away from the highland, more indigenous, departments where support for Mr Morales is overwhelming.” [F]

 

Nepal: the unmentioned crisis

If you were following Western news sources, you’d suppose that the biggest event there was the cabinet meeting part-way up Mount Everest as a stunt in the context of global warming. Only if you look elsewhere do you learn of a new round of confrontation, with the opposition Maoists confronting a government

The Maoists launched the war that ended the rule of the monarchy. They formed an alliance with other parties that led on to an election, with the intention to form a new constitution.   They won 40% of the votes in that election, way ahead of any other party. Second came the Nepali Congress Party and third the UML, which calls itself a Communist Party but has in practice been centre-left.

With this split and a host of smaller parties, the initial outcome was a government led by the Maoists and supported by the UML, with the Nepali Congress Party in opposition. This lasted until the Maoist Prime Minister tried to dismiss the Army Chief of Staff, who was breaking an agreement to integrate troops from the Maoist Army into the army that had fought for the King. The man was dismissed, but this was reversed by the President, who was from the Nepali Congress. The Maoists chose at that time to resign and a new government was formed by the UML and Nepali Congress. That was in May: it was unlikely to be stable.

What’s happening now – and not being reported in the West – is a new wave of protests by the Maoists against this new government.

“Maoists’ supremo Prachanda has warned that his party may declare a ‘parallel government’ in Nepal if the ruling coalition fails to address the key dispute over ‘civilian supremacy’, which has forced them to take to the streets.

“Prachanda, who headed Nepal’s first post-royal government, said even as they had withdrawn their plan to announce ‘autonomous states’ the party may declare a ‘parallel government’ if it was forced to move into the next phase of its protest to dislodge the alliance, the Nepalnews online reported.

“Responding to the stepped up security and threats to mobilise the army to maintain law and order in the face of the Maoists agitation, Prachanda warned the government that they would be compelled to take up arms if force was used to quell the protest.

“He challenged the 22-party government to mobilise the army to subdue the Maoists, saying the Nepal army is not the private property of some parties and that the army would not act at the behest of these parties, according to the Nepalese news portal.”[G]

There are some particular issues, but obviously it is basically about power. The Nepali Congress Party and UML don’t seem to want to change much. They are happy to keep unchanged the army that previously upheld an absolutist royalist government. And which has a lot of dirty deeds not so far paid for:

“The council of ministers Wednesday decided to appoint as the officiating chief of the Nepal Army an official against whom there are allegations of gross human rights violations by the UN itself. With the chief of the army, Gen Chhatraman Singh Gurung leaving for New Delhi Friday on an eight-day visit at the invitation of the Indian Army chief, Gen Deepak Kapoor, the cabinet has named as the officiating chief in Gurung’s absence Major General Toran Jung Bahadur Singh.

“Singh remains embroiled in serious allegations about his human rights record, which has forced the current government to put the proposal for his promotion on the backburner after objections by the Office of the UN High Commissioner for Human Rights (OHCHR). Three years ago, the OHCHR had released a report of its investigation into arbitrary detention, torture and disappearance at the army barracks in Maharajgunj in Kathmandu which was under the control of the Bhairabnath Battalion. Singh was reportedly the commander of the 10th Brigade in 2003-2004 during which period, nearly 50 illegally held prisoners disappeared, never to be seen again.” [H]

Of course it’s not just the army: the civil war has been called off for now but everyone knows it could resume soon. Words can be as effective as bullets, sometimes more so. So reporters are not treated as neutrals:

“The Maoists have also come under sharp criticism for continuing lawlessness. On Thursday, journalists also held protest rallies nationwide and sat in protest before government offices, condemning the attack on a young journalist in western Nepal, that is suspected to have Maoist involvement… Journalist Birendra Shah was killed in the Terai in 2007 but the two Maoist cadre who are believed to have been involved, were recently promoted by the Maoists.” [H]

Interestingly, the deposed King of Nepal chose just this moment to visit relatives in the Republic of India, which still has a large thought mostly powerless aristocracy.[L] He left on 6th December, in part to attend the wedding of a niece. But he plans to be away at least four weeks. The power-struggle might be over by then: if not he could stay away longer.

One solution to the crisis would be another election. The present government are unlikely to take this, because it seems unlikely that the Maoists would get less than the 40% they got last time. It’s been suggested that they might win outright, that the current governing parties are losing prestige with those who want a real change in backward semi-feudal Nepal:

“Although the UCPN-M has not totally given-up its armed struggle and if cornered from all sides, they are going to re-launch an armed struggle against the traditional enemies, but the party has given priority to capture state-power through ballot. The UCPN-M has carried out a survey on how they can bag two-thirds majority in the upcoming general elections after introduction of the new constitution. The present scenario is that the Nepali Congress organization is limited within urban areas and the same is true of the UML, as most of its grassroots cadres have already joined the Maoist party. Presently too, none of the political leaders, except from the UCPN-M, are able to go to the villages. In fact, the UCPN-M has developed the strategy of not allowing any of the political parties to carry out political programmes in villages. This strategy has been initiated by the party considering the upcoming general elections.” [J]

The USA is calling the Maoist action ‘undemocratic’, but they always do that when politics go in a way they don’t like. They are stuck in Iraq and Afghanistan and facing possible disaster in both. They can’t do much more than protest in Nepal:

“The US has expressed deep concern over stalled peace process in Nepal and the ongoing ‘undemocratic’ agitation launched by the Maoists that has led to political instability in the country.

“Chargé d’ Affaires of the US Embassy Randy Berry met Prime Minister Madhav Kumar Nepal yesterday and conveyed his government’s concern on the Maoists’ ‘undemocratic actions’ including the on-going House obstruction, the planned declaration of the autonomous states and seizure of crops and land.” [K]

It’s not undemocratic if the majority want it. The USA hasn’t observed any real rules in its various overseas adventures, knocking over elected governments and generating crises wherever this seemed a smart move. But the USA is now visible weakening. China is staying neutral, taking a general view that other country’s politics are their own business.

What else could happen? India could send in their army, as they did in neighbouring Sikkim, once an independent state but now absorbed. But Sikkim was tiny and traditionalist. Nepal is much bigger and has its own well-developed modern politics. Intervention in Nepal would mean a merger with Maoists in the Republic of India, themselves a growing force. That’s unlikely to be what they want.

I don’t know if the Nepali Maoists decided to time things for weeks in which the West was likely to be much more interested in celebrating Christmas. If so, it might well pay off.

[This was mistaken. The Coalition was able to win an election called in 2013, in which the Maoist vote slumped. The Coalition still have not produced a new Constitution or effective government.]

 

Carbon Privilege

The Kyoto Protocol was adopted in 1997 and ratified by 187 countries – but not the USA. It would have required industrialised countries to bear the main burden of combating global warming. The USA would prefer the cost to be born by the poor, something that the poor in the USA have cheerfully done. Globally, it has failed to work.

The first few days of the Copenhagen meeting have been dominated by an attempt to entrench ‘carbon privileges’, a system in which citizens of richer nations allowed to have a ‘carbon footprint’ seven or ten or twenty times as those in Brazil or China or the Republic of India. The idea was to burden the poor, not the rich. But I reported last month, China and the Republic of India had already got together and done a deal to prevent this. At the time of writing (11th December), it looks likely something more equal will be agreed.

Quite apart from having the largest ‘carbon footprints’, rich nations have done most of the historic polluting. That the fastest increase has come from developing nations is also true, but less important.

 

Truth Is Often Intolerant [Climate Change]

2% of Climate Scientists Can’t Be Wrong” is one of the better slogans of the Climate Control movement. There might be a one-in-a-thousand chance that the Climate Denialists are correct in saying we’ve got nothing to worry about. But if a fire alarm rings, any sensible person reacts as if the building is on fire? They don’t sit around because it may be a false alarm, as it usually is.

By the same token, Russian Roulette is considered a bad idea, even though one might expect more than 83% of those who try it to survive and maybe ease their inner turmoil. There’s too big a risk of being wrong.

There are also partisan interests with an interest in spreading confusion. George Monbiot put it quite nicely in a recent article. He noted “the contrast between the global scandal these emails have provoked and the muted response to 20 years of revelations about the propaganda planted by fossil fuel companies. I have placed on the Guardian’s website four case studies; each of which provides a shocking example of how the denial industry works.

“Two of them are drawn from Climate Cover-Up, the fascinating, funny and beautifully written new book by James Hoggan and Richard Littlemore. If every allegation it contained could not be traced back to leaked documents (I have checked all the sources), their findings would be unbelievable. Nothing exposed by the hacking of the Climatic Research Unit’s server is one tenth as bad as the least of these revelations.

“When I use the term denial industry, I’m referring to those who are paid to say that man-made global warming isn’t happening. The great majority of people who believe this have not been paid: they have been duped. Reading Climate Cover-Up, you keep stumbling across familiar phrases and concepts which you can see every day on the comment threads. The book shows that these memes were planted by PR companies and hired experts.” [P]

Even though Monbiot specifically said that most of the Denialists were duped rather than paid, he still got denounced in the comment columns by someone who proudly declared that he himself had not been paid by anyone.

Monbiot also notes the tactics used by the power-company lobbies – material has been leaked but not received the same publicity. “One of its findings was that ‘members of the public feel more confident expressing opinions on others’ motivations and tactics than they do expressing opinions on scientific issues’.

“Remember this the next time you hear people claiming that climate scientists are only in it for the money, or that environmentalists are trying to create a communist world government: these ideas were devised and broadcast by energy companies.”[P]

When Galileo argued that the Earth went round the sun, he left out the ideas of Tycho Brahe, who suggested that the planets went round the sun but the sun went round a stationary Earth. That doesn’t mean he was wrong. People who care passionately about ideas often go too far in defending them. This is foolish, because the people with money can always cheat much more efficiently and bias the reporting. Still, it is always likely to happen.

People who think they’re being cheated will often over-react, damage their own interests. But I think that’s an inevitable part of what makes us human. A cooperative group has to enforce standards. Smart professionals have learned how to use this to magnify the impact of the sins of one side.

Much more significant is what the weather is doing. Forecasts at the start of 2009 suggested a risk of a major heatwave in Britain, which did not happen. It was still a warm year, part of a trend

“The Met Office figures indicate that the years since 2000 – the ‘noughties’ – were on average about 0.18C (0.32F) warmer than years in the 1990s; and that since the 1970s, each decade has seen an increase of about the same scale.

“Although the Met Office has 1998 as the single warmest year, that coincided with strong El Nino conditions – the warming of surface waters in the eastern Pacific that releases heat stored in the deep ocean into the atmosphere, raising temperatures globally.

“Now, after a period of La Nina conditions which depressed temperatures in 2008, another El Nino is developing; and it is this, combined with greenhouse warming, that is pushing temperatures upwards again, according to Dr Pope.

“She declined to give a forecast for the next few years – the Met Office is releasing that later during this summit.

“But Nasa’s GISTEMP unit – the division of the agency that maintains the temperature dataset – suggests further warming is coming, with the temperature record for an individual year likely to be set within the next year or two.” [Q]

If 2010 turns out to be a record-breaking hot year, as seems likely, will that settle the matter? I fear not: it has become a matter of pride for some people.

 

References

[A] [http://www.ft.com/cms/s/0/594673f2-cba8-11de-924d-00144feabdc0.html]

[B] [http://www.ft.com/cms/s/0/6a14719e-e425-11de-bed0-00144feab49a.html]

[C] [http://news.bbc.co.uk/1/hi/business/8308459.stm]

[D] [http://news.bbc.co.uk/1/hi/world/americas/8385092.stm]

[E] [http://www.economist.com/world/americas/displaystory.cfm?story_id=14845301]

[F] [http://news.bbc.co.uk/1/hi/world/americas/8400639.stm]

[G] [http://timesofindia.indiatimes.com/world/south-asia/Nepal-Maoists-may-declare-parallel-government-Prachanda/articleshow/5209451.cms]

[H] [http://timesofindia.indiatimes.com/world/south-asia/Impunity-flourishes-as-Nepal-marks-Human-Rights-Day-/articleshow/5323347.cms]

[J] [http://www.peoplesreview.com.np/index.php?option=com_content&view=article&id=1713:fooling-everyone-ucpn-maoists-plan-to-capture-state-power-through-ballot&catid=34:weekly-news&Itemid=54]

[K] [http://timesofindia.indiatimes.com/world/south-asia/Maoists-agitation-in-Nepal-undemocratic-US/articleshow/5305279.cms]

[L] [http://timesofindia.indiatimes.com/world/south-asia/Gyanendra-leaves-for-India-amid-Nepal-bandh/articleshow/5308025.cms]

[M] [http://news.bbc.co.uk/1/hi/business/8407378.stm]

[N] Entry for Waterstone’s at the Wikipedia.

[P] [http://www.guardian.co.uk/commentisfree/cif-green/2009/dec/07/climate-change-denial-industry]

[Q] [http://news.bbc.co.uk/1/hi/sci/tech/8400905.stm]

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