Wednesday, July 18, 2012

Wealthy political segregation from the poor is neither sustainable nor ethical

So the Bavarian wing of the Christian Social Union, another conservative political group on whom the Merkel coalition is dependent, threatens to scupper her plans to bailout euro economies, according to Doug Saunders of the Globe and Mail. (see article below)
Doesn't this sound more than a little reminiscent of the Tea Party threatening to sabotage all attempts by the Obama administration to turn the American economy around, in the hope of rebuilding the middle class?
Or the oil-rich province of Alberta turning a blind eye to the eastern half of Canada, as they attempt, with the federal government's support, to grab big bucks, from the U.S. or other off-shore buyers for               their unrefined tar-sands heavy crude, without even considering a pipeline to eastern Canada both for supply and for refining "their" oil?Doesn't it seem more reasonable and responsible to view that oil as  a   Canadian natural resource, not just an Albertan windfall?
Have we got the beginning of an even tighter squeeze around the necks of the "poor" by the "rich" as they blindly, and somewhat arrogantly, parade their forms of separation, superiority and inward-looking thinking and power-shifting, like a fiscal tidal wave in effect silencing the needs of their brothers and sisters?
It would seem that financial independence, and the power that accompanies that wealth, could easily take over the world, in ways that would render the 99% impotent, and if these rich "blocks" of people think, by restraining their "hand-ups" they will retain both their wealth and their power, in the face of starving hordes who have no work and no prospects for either work or a decent income, they are living in a technicolor dream world of epic proportions.
Just because a province, or a country or a region is less affluent than her wealthy sister provinces or regions does not automatically mean the wealthy are, or have to be in charge. It is their narrow interests they are trying to protect, and such protection is simply neither sustainable nor worthy of being sustained.
We have to help such narrow perspectives to widen their range, lengthen their look into the future which, as they are proposing, they would control, when everyone knows that merely purchasing control of the debates is a very short-term and faulty game plan.
We need some longer-term thinking, sharing and planning and less hostage taking of public policy, in all corners of the world, including, I'm afraid, the re-education of the extremely wealthy, whose wealth, in too many cases seems to leave them deaf and blind to the big picture, that includes their unwanted need of the poor as much as the poor need them. That is not only an ethical goal, but a pragmatic necessity in terms of the much larger reality of interdependence. Denying support where it is needed is the kind of seed that will, like the wildest weed, snuff out the best and the brightest ideas and crops in the field of public policy. Gating rich political communities, in an attempt to preserve both their privacy and their wealth, while denying the poor and the starving and the restless unemployed on the other side of those gates, will only bring those hordes crashing through the gates, in some form at some time, probably sooner rather than later.

By Doug Saunders, Globe and Mail, July 17, 2012
Until now, it seemed that the greatest threats to the future of the euro were the collapsing economies of Greece, Italy, Spain and Ireland. But in recent days, a less likely threat has emerged: Bavaria.

This southern German state, known for its staunchly conservative politics, has launched a multi-pronged mutiny against German Chancellor Angela Merkel, her efforts to build a bailout plan for the euro economies, and the whole notion of European integration.
The rebellion, which has the potential to bring down Ms. Merkel’s coalition government, is led by two stalwart Munich conservatives who had once been strong backers of the Chancellor and her conservative Christian Democratic Union.

It began when Bavarian Premier Horst Seehofer, who is also the head of the Christian Social Union (CSU), the Bavarian branch of Ms. Merkel’s party, declared two weeks ago that he would pull all the Bavarian seats out of Ms. Merkel’s coalition if she allowed the European Stability Mechanism to finance bailouts of more countries.
Without the backing of Mr. Seehofer’s bloc, Ms. Merkel would not have a majority in parliament and would rely on the wavering support of the left-wing opposition parties.
“The time has come when the Bavarian government and the CSU can no longer say ‘yes’ any more,” Mr. Seehofer told reporters, “and the coalition has no majority without the CSU’s seats.”
While Mr. Seehofer is known for such bombastic declarations – and he has reason to be distancing himself from Ms. Merkel because he faces a difficult re-election campaign next year – most observers feel that he has tapped into a nerve of public discontent over Germany’s economic responsibilities toward the European countries that form the main market for its exports.
“German politics have always been largely consensus-driven, and just as it seemed all the parties were agreeing that more European unification is something good and right and everyone should support it, Seehofer has come in and really opened up the debate and challenged everything,” says Almut Moller, an analyst with the German Council on Foreign Relations.
Indeed, on Tuesday Mr. Seehofer launched another attack on Ms. Merkel by asking Germany’s constitutional court to challenge the legality of Germany’s own internal “solidarity transfers,” in which wealthy states like Bavaria pay about $9-billion a year to help the impoverished states of the former East Germany.
While ostensibly a matter of internal German politics, many Germans saw it as an indirect attack on aid to crisis-ridden European countries.
“There is a real mood among many voters in Bavaria that they don’t want to pay for the rest of Germany, and even less do they want to pay for the rest of Europe,” said Mr. Moller. “It is a message that many people in Germany will recognize.”
Indeed, a poll this week conducted by Stern magazine showed that 60 per cent of German voters oppose giving up any fiscal sovereignty in order to preserve the euro.
The second attack was launched last week by the outspoken Munich economist Hans-Werner Sinn, who organized a widely published letter signed by 190 other conservative economists that condemned Ms. Merkel for allowing the euro-zone bailout fund to create a “banking union” in which troubled banks will be subject to common funds and standards – another key component of Ms. Merkel’s euro package.
The letter warned that “taxpayers, retirees and savers in the still-solid countries of Europe” would be unfairly burdened by the rescue of economies in the periphery and that the policy would result in catastrophe. The Munich revolt has shown that Germany’s consensus is far from stable and that a significant number of people, including some senior officials, are more interested in maintaining national sovereignty than in taking the measures that would prevent a euro failure.
“I wanted to initiate a public debate about the consequences of a banking union,” said Wolfram Richter, an adviser to Germany’s finance ministry who signed Mr. Sinn’s letter. “I feel there is a need to discuss whether the people of Europe are ready to give up national autonomy for the sake of the common currency.”
Mr. Sinn and his Munich-centred movement have struck a chord with voters, and many see Mr. Sinn’s interventions as the vanguard of a political movement that is likely to play a strong role in German politics during the next year.

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