Scary Stuff: Part I

Given that it is Halloween one of the blogs I read decided to come up with a few "scary" graphs to show where we are and where we might be going.

It was scary, to a point.

The charts in question were G7 Debt to GDP Ratios; Health Care Costs and Aging Populations; Income Inequality; and Global Food Consumption.

Taking them briefly one at a time I have the following comments.

It is no surprise that the Debt to GDP ratio of the G7 has risen steadily since the financial crisis such that they have risen from 80% to 120% in the last 6 years (according to the IMF).  This ratio is in and of itself neither surprising nor overtly disturbing-unless we have another financial crisis.

If we do have another debacle, assuming it will hit the G7 nations hard, then they will have much less flexibility to finance their way out of the problem then they did the last time around.  This is why there is such a fine balance between austerity programs designed to decrease deficits and unemployment which could trigger declines in real estate values and social unrest which just might require either less austerity or none at all.

The second chart, Health Care Costs and Aging populations showed that health care costs are creeping up as the population ages combined with lower birthrates in the industrialised world resulting in lower social payments being made to the system. 

This can't be good- and it isn't.  But declining birth rates in these countries reflect in many instances a realisation that children have a financial responsibility associated with them and therefore many people choose to have less children than they might have liked.  Of course there are many people who ignore the cost of children either out of ignorance or a misguided belief that to have children is either a right or even a requirement to have children.

Which takes me to the last chart, Global Food Consumption. 

Thomas Malthus predicted that there would come a time when population growth outweighed the increase in farming productivity such that at some point there would not be enough food.  This was 200 years ago.  To date we keep coming up with new means of increasing agricultural productivity, but there is a tipping point out there lurking around the (next?) corner.

Which takes us back to the third chart, Income Inequality.  This is perhaps the scariest chart.  It showed the wealth distribution to the bottom 50% of the top 15 industrialised nations and that held by the top 10%.  The chart essentially says that the bottom 50% are in trouble-and they are in the industrialised world.  Except for the USA, where despite its' claims of political and economic democracy it looks more like a third world state, these are relatively wealthy states with social policies one would have thought would have presented this inequality.

Without wanting to be alarmist, or Marxist, one cannot deny the fact that as food prices go higher, health costs go higher, and debt ratios to GDP preclude a sustainable increase in social spending that the threat of social unrest will increase.  This could have far-reaching effects on democratic institutions and ideals, and could conceivably result in an increased probability of revolution.

If social cohesion does come apart at the seams- the future could look very scary.

More Spying

It was brought to my attention that perhaps the unnamed NSA source mentioned in the Bild am Sonntag article was none other than Edward Snowden.  Now Edward started leaking information June 5th so I have to assume that his source of on-going information was cut pretty quickly around that time so I am not sure how relevant he would be as to at-the-minute revelations about Obama and Merkel.

If it were Snowden they were speaking with then it throws a very different light on his self-proclaimed  intentions where he said that he was just trying to help the U.S. national security by prompting a badly needed public debate about the scope of the intelligence effort.

If that is truly the case then either he is very stupid or someone else has taken over the responsibility of the time and nature of the continuing leakage of information. 

In May of this year Snowden arrived in Hong Kong with 4 computers which allowed him to access the highly sensitive information he then leaked/handed over to journalists from the Guardian newspaper.

He then travelled on to Russia where after a convoluted process was granted asylum.

His initial interview with the Guardian opened up the existence of numerous programs run by the NSA which allowed them to eavesdrop apparently on anyone anywhere through some form of collaboration with the big internet/phone networks.

Without question the ensuing articles touched off a debate in the US and in Europe.  It didn't create the same debate in China or Russia although one has to assume that the same sort of surveillance was taking place there as well so either the NSA was not able to breach their defences or the Russians and Chinese were very quick to clamp down on any distribution of the eavesdropping taking place in their countries.

But if Snowden really just wanted to spark a debate about the intelligence effort why has he gone on to leak information which is potentially seriously damaging to the geopolitical relationship between the US and Europe in general and with Germany specifically?

I fully understand that Snowden was full of righteous indignation at what he considered to be the invasion of privacy on a massive scale by the NSA.

I would however think that either he is totally naïve and has no understanding of the damage he is doing to the US-rightfully or wrongfully- potentially opening doors to the Russians or the Chinese to exploit.

Does he think that there is any internal debate about anything in either of those countries let alone the activities of the Federal Security Service (FSB) in Russia or the Ministry of State Security (MSS) in China.

Two wrongs don't make a right. 

But geopolitics is not kindergarten.

What's your Angle?

As an avid reader of articles and commentaries in every form of media one of the first checks I make to try and establish the likelihood that the information is bonifide- or not- is to check the source. 

One of the blogs I read claims to try and give a balanced account in their reporting although its' founder does admit that "we have a frustration all conservatives have", which is "the bias in media against conservatives, religious conservatives, [and] Christian conservatives" and so I have to take an extra large pinch of salt when I read their articles.

That being said I guess I had expected more of them than their recent article on NSA spying on foreign nationals in general and Frau Merkel specifically. 

The cause of my dismay is that they chose to use quotes from "Bild am Sonntag" to legitimise their claims that Obama not only knew that the NSA was bugging foreign national's phones, but that he had specifically asked them to bug Frau Merkel.

Now using Bild am Sonntag as your source of information is one step above using the National Enquirer.  A small step I might add.  It is the lowest common denominator of the intellectual capacity of the "mob"-apart from their sports pages which are actually quite entertaining.

So why did they choose to quote Bild Zeitung using an article predicated on a report from unnamed sources inside the NSA?

"Unnamed" sources from the NSA would be breaking their confidentiality clauses and given the nature of their employer quite likely could be construed to be committing treason-but that is sort of beside the point.  Itis extremely likely that anyone within the NSA willing to offer information harmful to Obama is doing so exactly to harm Obama-casting extreme doubt on the veracity of their claims. 

The idea that a member of the NSA would be so against Obamba that they would damage not only Obama but the relationship of the US with one of our most important allies sounds very similar to the mindset that was willing to close the US government and even risk default just to attack Obama. 

What is even more curious is that in indicting Obama they also had to indict G"W" Bush.  Throwing Obama and Bush into the same pot is a bit strange- unless you are just outright anti-US so I wonder just what this "unnamed" source was trying to achieve.

Of course that presumes that there was as unnamed source.

Which takes me back to my original question: why did this conservative blog choose to quote Bild am Sonntag in the first place and what were they trying to achieve.

Who is Spying on Whom....

Today the American Ambassador to Germany was called in for a meeting by the German Foreign Minister Westerwelle to discuss the charge that the American National Security Agency (NSA) has bugged Frau Merkel's mobile telephone.  Just to make it more exciting the Bundesanwaltschaft or the Federal Prosecutor's Office has also been brought in to the investigation which ups the stakes considerably.

Now there are a number of points to be made here.

As the first allegations of wiretapping of foreign nationals by the NSA hit Germany Frau Merkel was noticably quiet.  There were grumblings that of course it didn't surprise her.  Wasn't the Bundesnachrichtendienst (BND)-the German Intelligence Service-doing the same thing?  And, even if they weren't, than surely spying by the NSA could not possibly impact her-she was not a mere mortal, she is the Chancellor.

But now, all of a sudden, she too has perhaps been dragged down to earth and suddenly she too is annoyed.

But back up for a second.  The NSA is responsible for the security of the United States.  Unsurprisingly in a capitalist country in addition to the political and military security of the USA they are also responsible for the economic security of the country.

Suddenly wiretapping the German Chancellor's mobile who is not only Germany's leader but to a large degree also the defacto leader of Europe is less surprising.  Without a question Frau Merkel puts Germany's interests first followed very closely by Europe's interests-they are in many instances one and the same-and often not necessarily in the interest of the USA.  Just think of the various stimulus packages, banking controls or Germany's lack of support for some American military ventures which are not easily construed to be in America's interest.

Add to that the fact that she is much more willing to engage with countries like Russia and even China- countries that the USA is much more suspicious of than she is-and wouldn't it be nice to know what she is saying.

No, I am not surprised that her mobile phone most probably has been tapped by the NSA.

I would be surprised however if the German Counterespionage Agency had not provided her with a secure phone, and I would be surprised if she didn't use that phone for all non-personal business.

I am however actually somewhat disappointed that despite her humbleness as one of the most powerful policitians in Europe if not the world, she has suddenly just now realized that she too is a mere mortal and that (of course) the NSA would try and tape her phone.

Ideology is Easy. Principles are Difficult

There are those who maintain that the current paralysis in American politics is a direct result of the intentional inefficiencies incorporated into the Constitution to ensure that the government did not become an all-powerful institution which could easily fall prey to tyranny.

Why else would there be so many checks and balances throughout the structure be it the three centres of power at a federal level or the byzantine relationship between the individual states and the federal government.

These men were trying to emulate the Roman ideal of the Senate. They were honorable men. They were moral men. And they were virtuous men. 

So far so good. 

The first thing was to declare independence.  Then, after winning a war, was to write a Constitution.  From the start it took a lot of discussion, negotiation and in the end compromise.  It was also recognized that there could/would be amendments to it which would serve to clarify certain points but would not change its basic premises.

Despite all the intellectual capacity involved in the creation of the Declaration of Independence and the writing of the Constitution it must be remembered that this was a move from monarchial to democratic rule. The Declaration is a very measured document giving rights and responsibilities to the People. It opens the door to change, and in the same breadth cautions those thinking of change that it should "not be changed for light and transient causes" and essentially should only be invoked in the face of despotism.

They were not ideologues.  They certainly were not fanatics.  Indeed they were pragmatists. 

So how would they have addressed our current debt/default debacle?

Their approach to debt was that it was not a good thing under normal circumstances, but there were of course instances when it was necessary.  Their understanding of default was something that happened because one could not repay their debts.  Self-inflicted default as a result of ideological fanaticism would have been outside their realm of thinking.

They certainly would not have allowed a fanatical group- the Tea Party-to try and hold the government hostage.  They would not be happy with the debt burden we have, and so they would have worked hard to try and work out a reasonable way to find relief.

They would have had their own interests to mind, but would have put the interests of the United States above all else.

Those were the days.

The 200th Anniversary of the Battle of the Nations

200 years ago The Battle of the Nations took place in and around Leipzig signalling the beginning of the end for Napoleon. Although often seen as the catalyst for the idea of a united Germany, in the end it heralded the restoration in France and was actually viewed as a war against the ideas of the French Revolution by Europe’s monarchs and members of the ruling classes such as Count Metternich.

Indeed, the victorious "German" Generals Stein and Gneisenau thought they were fighting for their freedom and liberty from occupation and oppression from a foreign power, not to put the old guard back in power.

They were wrong.

Almost immediately after the battle the political reforms which had been introduced in the years from 1807 to 1812 were either delayed or outright blocked.

This was followed by a rapid expansion of the political police and a highly organised secret police apparatus which drove many people into what later under the Nazis became known as "internal emigration.

This created a peaceful un-politicised time with a brief interlude in 1830 and 1848, setting the stage for a German Nationalism personified by Kaiser Wilhelm I yet managed by the Realpolitik of Bismarck.

Unfortunately for Germany, and eventually the world, Kaiser Wilhelm II wasn't impressed by Bismarck's approach, pensioning him off and taking matters much more into his own hands.

There are those who would maintain that Napoleon's defeat at The Battle of the Nations and the collapse of the ideals of the French Revolution outside of France gave rise to a "Prussian" Germany. They would also draw a straight line from Leipzig through Paris by way of Koeniggraetz up to the World Wars I and II.

That is understandable, but I would deem it to be too subjective.

I would rather look at the weaknesses of Wilhelm I and the lack of checks and balances inherent to a Monarchy.

Regardless it is interesting to see that representatives from all the various participants in The Battle of the Nations have gathered in Leipzig for the 200th Anniversary.

Next year is the 100th Anniversary of the start of World War I. I wonder how that is going to be marked and if 100 years is enough to bury hatchets.

 

 

News Flash-There Otta Be A Law....

The US Congress was able to get its act together enough to reopen the government and to kick the proverbial can to the next "closure" date of January 15th and deficit rollover date of February 7th.