Saturday, May 25, 2013

What is Needed for a Recycling Mechanism to Start?

A reply to Professor Varoufakis on his proposal of a recycling mechanism from countries with surpluses in his talk to the OECD.

By Con George-Kotzabasis

The working of a recycling mechanism from countries that are in surplus would primarily need the physical stature of Professor Varoufakis, that is, lean efficient competitive economies with no wastage baggage and lean governmental apparatuses. Most economies, however, of southern Europe are in a state of pathological obesity in both regards and thus are being unfavourable turfs for surplus countries to plough their money into them. For the wheels of the recycling mechanism to start therefore, it would be necessary to fundamentally restructure the economies and governments in the former case, on the ethos of a competitive market economy, and on the latter, by removing the destructive policies of government intervention and excessive regulation in the sphere of private enterprise.  Only countries free from the deleterious effects of un-competitiveness and government dirigisme and replete with entrepreneurial dynamism acting within a private enterprise system can be favoured to be the recipients of the manna of the recycling mechanism.

The above argument is reinforced by the two historical examples in Professor Varoufakis’ presentation where he shows that the Americans at the end of the Second World War recycled the major part of their surplus to Germany and Japan, the two countries that were renowned for their economic efficiency and technological feats and operating within the private enterprise system, and the second, when China and the oil producing countries of the Arab peninsula recycled their surpluses to America on the basis of the same principle, that is, of economic prowess and competitiveness. In neither case were these surpluses recycled to “Africanized” economies. Likewise, why European countries, such as Germany, that are in surplus, should recycle the latter to the economically sclerotic countries of the south unless the latter engaged in a radical restructuring of their economies that initially would be followed with a lot of pain as Greece presently shows with the radical changes that are taking place in its economy under the robust and imaginative Samaras government? It is easy to talk about the misanthropy of the elites but what about the misanthropy of those politicians of the left, such as Andreas Papandreou, who for years created a false prosperity for their peoples without telling them of the heavy price and suffering they would have to pay for it and the great crisis that they would be engulfed in?

Can Professor Varoufakis envisage that the great foundational changes that are required, so the recycling river of funds will inundate those countries that are at the bottom pit, can occur without pain? Is the Heracletian profound maxim that out of “great discord rises the greatest harmony” to be negated by the votaries of the “dismal science”?

Guest (Xenos) says,

Incorrect, in every way and on every level.
Per capita, Greece received more than any other country from the Mashall Plan and other forms of financial assistance from the USA. Germany and Japan received the most because (a) they were the largest countries lined up to receive funds, and (b) because they had been decimated by the war. It had nothing to do with your homespun nonsense about “Africanised countries” — whatever you think those might be.
Your speech is nothing more than empty rhetoric and has no relation to historical reality or economic analysis.

Kotzabasis says,

Greece was a special case due to the civil war and the threat of a communist take-over and the fact that America replaced Britain as the plenipotentiary of Greece and its protector from communism. And it goes without saying that part of the reason why funds flowed to Germany and Japan was their devastation. But the major reason was that the Americans wanted to create a locomotive of economic development in these two regions and that is why they chose Germany and Japan renowned for their past economic prowess. Professor Varoufakis himself in his presentation makes it quite explicit that China invested its surplus in the United States precisely because of the latter’s high competitiveness (M.E).

Sunday, May 5, 2013

All the President's Disablers

I'm republishing this paper written in 2007  as the intellectual prattling know-all elite continue to disparage and malign George Bush for his decision to invade Iraq.

A response by Con George-Kotzabasis to:

All the President’s Enablers by Paul Krugman
The New York Times July 20, 2007

The fundamental principle of power and of any political activity is that these should never be any appearance of weakness. Niccolo Machiavelli

The eminent professor of economics Paul Krugman who ditched his solid professorial chair for the ephemeral glitter and celebrity status that accrues from being a peer pundit of The New York Times, ridicules George Bush, in his latest article, of a misplaced confidence that verges to a “lost touch with reality”. Confident to bring in Osama dead or alive, confident toward the insurgents “to bring it on”, confident that the war will be won, when the latest report of the National Intelligence Estimate is so gloomy about the prospects in Iraq and the war against al Qaeda that would make even the most optimistic of Presidents to have second thoughts about his policy, but not George Bush. Krugman states, “thanks to Mr. Bush’s poor leadership America is losing the struggle with al Qaeda. Yet Mr. Bush remains confident”. Such a stand “doesn’t demonstrate Mr. Bush’s strength of character” but his stubbornness to prove himself right despite the grim reality.

But Krugman saves his main grapeshot to fire it against the Republican doyen Senator Richard Luger and General Petraeus both of whom he considers to be the “smart sensible” enablers of the President. He argues that while Senator Luger knows, and indeed, acknowledges, that Bush’s policy in Iraq is wrong, he nonetheless is not prepared to take a strong stand against it. And he cleverly in anticipation of the September report of General Petraeus that might be favourable to the situation on the ground as an outcome of the surge, he launches a pre-emptive strike on the credibility of the general by quoting extensively from an article the latter wrote in the Washington Post on Sept. 26, 2004, whose assessment about Iraq at the time was overly optimistic if not completely wrong. In the article the general wrote, “that Iraqi leaders are stepping forward, leading their country and their security forces courageously” and “are displaying courage and resilience” and “momentum has gathered in recent months”. It’s by such implied non sequiturs that our former professor attempts to discredit General Petraeus. Just because he might have been “wrong” in the past it does not follow that he would be wrong also in the future. And Krugman caps his argument by saying that because of these “enablers” of the President, “Mr. Bush keeps doing damage because many people who understand how his folly is endangering the nation’s security still refuse, out of political caution and careerism, to do anything about it”.

But how serious are these strictures of Krugman against the President and his so called enablers? Let us first deal with the optimism of Bush and his confident statements about the war in Iraq and the struggle against al Qaeda. Krugman is lamentably forgetful that when the President committed the U.S. to take the fight to the terrorists he stated clearly and unambiguously that this would be a generational struggle. And in this long war against al Qaeda and its affiliates and those states that support them, he was confident that America would prevail. Hence all the confident statements of Bush were made in the context of a long span and not of a short one as Krugman with unusual cerebral myopia made them to be. His argument therefore against the President’s optimism and confidence, which he ridicules with the pleasure of one “twisting the knife”, is premised on a misperception. Moreover, did Krugman expect that the Commander-In-Chief of the sole superpower not to have expressed his hopefulness and confidence to the American people, when they were attacked so brutally on 9/11, that the U.S. in this long war would prevail? And is it possible that our pundit to be so unread in history and not to have realized that in all critical moments of a nation’s existence it’s of the utmost importance that its leaders rally their people against a mortal threat with statements of hope and confidence, as Winston Churchill did in the Second World War, that the nation would be victorious against its enemies? Would Krugman have the President of the United States adopt the gloom and doom of the so called realists as a strategy against al Qaeda, its numerous franchises, and the rogue states that support them by sinister and covert means?

Indeed, the liberal’s and The New York Times’  “Bush derangement syndrome…has spread” not only “to former loyal Bushies”, to quote Krugman , but to more than two thirds of the American people thanks to this ignominious coterie of  all the President’s disablers of the liberal establishment, and its pundits, like Paul Krugman. The paramount duty and responsibility of the media, being the Fourth Estate in the political structure of a democratic society, at a time when a nation faces and confronts a great danger from a remorseless and determined enemy, is to morally mobilize and rally its people behind their government and their armed forces that are engaged in war. In the present defensive pre-emptive war--the latter as a result of the nature of the enemy and his potential to acquire nuclear weapons--that has issued from the aftermath of 9/11 and the cogent convincing concerns of the Bush administration of a possible nexus in the near future between al Qaeda and its sundry affiliates with rogue states armed with weapons of mass destruction and nuclear ones, and the portentous and abysmal danger this would pose not only to the U.S. but to the world at large, the media has a “sacred” obligation to unite the American people behind its government of whatever political hue. No errors of judgment or mishandling the planning of the war by the Bush administration can excuse the media from abdicating from this historical responsibility.

There is no fogless war and no one can see and perceive and measure correctly all its dimensions. And the frailty of human nature further exacerbates this inability. But no Churchillian confidence in one’s actions and strategic acumen throws the towel because of mistakes. One corrects one’s errors and keeps intact his resolution to defeat the enemy with a new strategy. (And one has to be reminded that the greatest scientific discoveries have been built on a pile of mistakes.)  It would be an indelible obloquy to one’s amour propre to even consider that these uncivilized obtuse fanatics, and seventy-two virgin pursuers, could come close to conceiving a strategy that would defeat the know-how and scientific mastery of Western civilization and its epitome the United States of America. Only a lack of resolve of its politicians and its opinion-makers, as a result of their fatal embrace with supine populism, appeasement, and pacifism, could lead to such shameful and historic defeat.

America at this critical juncture of its historical and Herculean task to defeat Islamofascism in a long, far from free of heavy casualties, painstaking arduous war  needs a wise, imaginative, and resolute political and military leadership that will overcome all the difficulties and imponderables of war and will strike a decisive lethal blow to this determined suicidal enemy. The new “Surge” strategy of the resolute Bush administration implemented by that “superb commander”, according to his troops, General Petraeus, seems to be accomplishing its objectives. Two prominent and vehement critics of Bush Michael O’Hanlon and Kenneth Pollack of  The Brookings Institution who had accused the President of mishandling the war, after an eight-day visit in Iraq talking to high officials now believe that we are fighting in “a war we just might win”. And Petraeus, like a stronger Atlas, is pushing the rise of the sun of victory in the up till now dark sky of Iraq. Hence, the courageous actions and sacrifices of U.S soldiers in Iraq are not wasted and will be written with adamantine letters in the military annals. At this momentous noteworthy victory all the President’s and the nation’s disablers will be cast into the pit of ignominy by history. 

I rest on my oars:your turn now