Friday 25 March 2016

Another March 25th Extravaganza

I'm writing this blog post on March 25th, which is Greek Independence Day. I've just returned from an early lunch of bakaliaro skordalia from a greasy spoon taverna in the district of Athens where my parents live.

Some notes:

1. The restaurant was fully-booked, with rush hour expected from 13:00 and later. People were being turned away at the door. This is despite the Greek economic crisis.

2. The managers, knowing there would be a rush, had pre-fried a large batch of bakaliaros (cod), which they served fried in batter. It was perhaps not the finest moment in Greek cuisine.

3. The bill came scribbled on paper. Not printed off the cash register.

4. Three people at three odious portions of cod plus boiled greens and taramosalata for € 30.00

5. Smoking was permitted inside the taverna.

Oh, and I was the youngest person in the restaurant -- for a while.

I wonder why so little in Greece seems to change, despite the very obvious need for it to change. And as usual, I have no answer.

(c) Philip Ammerman, 2016 

Monday 21 March 2016

Wolfgang Muenchau has it exactly right on European policy towards Turkey and refugees

Wolfgang Muenchau has written a powerful article in the Financial Times which accurately describes what many of us in Greece and Cyprus are feeling.

The EU had two assets I have always considered un­assailable, however much I may have questioned various decisions. The first is a lack of alternatives. How else can Europeans confront climate change, a refugee crisis or an over-assertive Russian president if not through the EU?

The second is the moral high ground. Compared with the majority of its member states, the EU is less corrupt, more principled and rules-driven. Whereas the world of national politics is full of tacticians out to seek short-term gain, the bloc manages a better mix of politics and policies. It builds broad coalitions and formulates strategic policy objectives. Its horizon extends beyond the life of a parliament.
Within a few years those assets have been demolished. The mismanagement of the eurozone crisis made it possible to formulate a rational economic argument for an exit.

Then, on Friday the EU lost its other key asset. The deal with Turkey is as sordid as anything I have seen in modern European politics. On the day that EU leaders signed the deal, Recep Tayyip Erdogan, the Turkish president, gave the game away: “Democracy, freedom and the rule of law...For us, these words have absolutely no value any longer.” At that point, the European Council should have ended the conversation with Ahmet Davutoglu, the Turkish prime minister, and sent him home. But instead they made a deal with him — money and a lot more in return for help with the refugee crisis.

I find it interesting to what extent the European Commission has been bending over backwards to accommodate Angela Merkel's decision to open Germany's borders last year. Once again, another European decision is being made which:
  • Contradicts earlier decisions and international treaties.
  • Rewards Turkey for illegal activities occurring on its own soil, that the country has made few substantive attempts to interdict. I refer here to human trafficking, smuggling and the vast and obvious commercial presence built up around the process of moving hundreds of thousands of refugees and migrants at key points on Turkey's Aegean coastline.
  • Ignores the very visible human trafficking and smuggling operations on Turkish and Greek soil, instead deploying a bureaucracy-heavy mechanism to address a problem without understanding its commercial basis. 
  • Rewards Turkey by re-opening accession chapters, despite the fact that Turkey is--according to UN decision and international law--militarily occupying the territory of an EU Member State (Cyprus), which it also refuses to recognise. 
  • Promises visa-free travel for Turkish citizens into Europe without even the semblance of a democratic decision among European voters.
As Muenchau writes, this deal is both sordid and probably cannot be implemented. And it definitely calls into question why sovereignty should be shared, given the repeated, biased and catastrophic errors in European policy-making.

(c) Philip Ammerman, 2016

Saturday 5 March 2016

Stephen Fry on the Parthenon Marbles

I missed this when it was first aired, but it is by far the most eloquent argument why the Parthenon Marbles should be returned to Athens that I have every heard. Stephen Fry has my vote.

Friday 4 March 2016

Ben Hunt On Swedish Central Bankers

Ben Hunt had another superlative post on Epsilon Theory. The following quote is spot-on. No further comment is needed. 3229431

I mean, this is what it's come to, right? Where smirking Ph.Ds who have never spent a day of their adult lives outside of the governmental or academic womb, where earringed, pony-tailed apparatchiks who have never managed a dime, who have never counseled a retired couple trying to live on their savings, now unilaterally and without limitation make political decisions that determine the fate of that retired couple. Not just in Sweden, but everywhere in the world.

Yeah, I shouldn't mention the whole earring and pony-tail thing, but you know what? It's an intentional statement of identity, an identity that I recognize from my decade as a political science professor, an identity that not only elevates elegant theory over practical experience, but more than that, dismisses practical experience as inherently inferior to the tenets of an academic faith. It's the hubris, the overweening pride that oozes from this photo that makes me cringe.

We've seen this movie before, and it always ends in tears. There's a reason that Pride is one of the Seven Deadly Sins, and nowhere is pride more dangerous than when it comes to financial "innovation." What the Gaussian copula was to securitized mortgages in 2008, negative rates are to monetary policy in 2016.