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Industry
They’re coming for us – Image by okano via Flickr

Maybe all I need here is a good hug. Ideally, one that will last years.

But I must get it together. We’re under attack. Market forces should be making entertainment industry conglomerates less relevant these days. But why accept the market, when you have the influence and – despite all the protests of enormous theoretical losses – the wealth to get laws passed?

Laws that could make you richer than ever.

It is my view that, under the guise of desperately needing protection, the entertainment industry is trying to pull off an outrageous power-grab. What big businesses know better than anyone is that the secret of success is not making the best product, but controlling the marketplace. They know the Internet is their only future marketplace. They want it.

SOPA and PIPA, their US bills, have been pushed back for now, but there’s a new threat looming from an intergovernmental treaty called ACTA. Ostensibly to control the trade in counterfeit goods (including, it should be noted, generic medicines), it actually concerns all types of intellectual property – suggesting that governments (or their industry sponsors) wish us to think of copying a song or video as “counterfeiting” now – a serious crime of intentional deceit.

Among ACTA’s many negative effects, it appears that it would make your Internet service provider (ISP) liable for any illegal online activities, forcing them to monitor you. That is not different from requiring the postmistress to read your mail and report anything suspicious she finds, and I don’t think it’s acceptable in democracy.

If Big Entertainment gets its wish, the Internet will eventually cease to be a way for people to freely communicate with one another, becoming instead just a secure channel it can use to deliver its goods to us. And to keep us monitored, of course.

High-Speed Chicken Crisis

This is an actual serious real statue
This is an actual serious real statue

Today a pair of chickens that flew off in opposite directions came home to roost. I’m needlessly introducing the concept of flying chickens here, but bear with me. We are seeing two long processes reaching the crunch simultaneously: EU integration, and Thatcherism.

That these would reach a joint crisis point was perhaps predictable. They were two trains going to different destination while trying to use the same tracks. I’ve already given up on keeping my metaphors coherent. This has been on the cards for… Well, about thirty years. Ever since Margaret Thatcher brought a value-for-money attitude to bear on the idealism of the European process. Since then, Britain has been avowedly in Europe for what it can get out of it, and this has grown into a weird political schizophrenia as politicians, Tories especially, cynically portray a Britain-versus-Brussels conflict for domestic electoral advantage while their businesses reap the rewards of the Union.

The chicken of integration has come up against the buffers of political reality too though. It was never likely that a single currency would succeed without real central monetary authority, but the project was started – in typical political compromise fashion – with only the bits everyone liked. I’m sure deep down they knew it would take a crisis to complete the process; I doubt they envisaged this though.

That it should turn into a crisis over the direction and even definition of the Union was also perhaps foreseeable. Creating EU-wide financial controls that have a hope of stabilising the European economy would entail reversing some of the banking deregulation that, while bringing vast profits to relatively few, helped precipitate the recent crises. And which, since the Thatcher revolution, has been so championed by the UK – perhaps because that same few has a disproportionate influence over the Conservative party.

So we just saw the UK use its veto to block a decision that the Eurozone countries see as vital to their financial survival. Now there is no other option except an international, multilateral treaty between – it now appears likely – every EU country except Britain. A treaty that will, if you will, be a massive Fuck You, UK.

Address To The Nation

Enda Kenny making a speech in the Burlington H...
The Taoiseach, saying things. For some reason

The country stood by today as our leader Enda Kenny addressed the nation – only the sixth time in history that a Taoiseach has done such a thing. His speech left but one question on lips across the country.

What the hell was that for?

The speech contained much that would have been bad news, if it had been news. It was depressing, sure, but confusingly it did not contain the really awful tidings that would have justified its existence. So it’s pretty much as we expected.

No mention of any welfare rates being further cut, but no mention of them not being cut either. So expect that.

Direct taxes will not be raised, but indirect will. In other words, money will be extracted not just from those who have it, but rich and poor alike. Or as Enda put it:

“I wish I could tell you budget won’t impact on citizens in need, but it will.”

It seems the poor and sick aren’t actually going to be rounded up and shot though. Presumably they’re dying off at a rate sufficient to give markets confidence in our government’s international-finance-friendly ruthlessness.

The highlight I think was when he told us that the economic collapse was not our fault, even if we were all going to have to pay for it. Nice of him to mention that I suppose. We did know though.

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Our Man In Luxembourg

European Court of Auditors
The Headquarters of the Society of Shepherds. 

Minister for Jobs, Enterprise & Innovation Richard Bruton has said the Government wants to see the nomination process of Kevin Cardiff to the European Court of Auditors through to its conclusion. (RTÉ News)

Why – what did he ever do to them? This is just going to be humiliating.

You can see the government’s standpoint – while also seeing how hopeless it is. They want to emphasize that they are a different regime from the one that let the Irish economy down the plughole. Well and good, but they have an uphill battle merely to convince the European Parliament that any Irish nominee deserves to be on the Court of Auditors.

We just had an economic collapse due largely to the ridiculous lack of oversight by our Department of Finance, with every sign of excessive personal closeness between government and the money industry. Why should anyone from a country like that be even allowed a nominee? The “Court of Auditors” is a rather dull-sounding name, but this is the EU body specifically tasked with fighting corruption. It’s like having the wolves nominate their shepherd representative. There’s really only one reason why they will accept any Irish representative at all: They have to. It’s in the treaties.

So there was every reason to expect that a nominee to the court from Ireland was going to come under the closest possible scrutiny. Yet what do we send? A man who held a top position in our disastrous Department throughout the boom and bust. A man who was actually present when the inexplicable bank guarantee was given.

They must think we’re joking.

Shed A Tier For Social Justice

Aztec ritual human sacrifice portrayed in the ...
Multi-tier medical systems in history

The €50 charge for the medical card is surely a decoy, on the list purely to make increased prescription costs and bed closures seem more acceptable. Don’t let them away with it. There are ways to save money – or save the euro – that don’t involve ritual human sacrifice. We have a two-tier health system more wasteful than you’d see in any nightmare, even if you regularly dream about inefficient public resource allocation.

Consider a moment: We have to maintain a huge national infrastructure, staffed by public employees with all that entails, and then not let the majority of people use it because they’re not poor enough. Those who don’t qualify are forced into the hands of the profit-making health industry – which we then subsidize by allowing them to use the huge public infrastructure. We’ve basically taken on their capital costs.

This government was elected on the promise of introducing a single-tier health system. OK, they could have got elected on the promise of doing a little dance, but this is the one they made and it’s a highly desirable – in fact a necessary – thing. Problem is, it looks as though they’re employing the simple expedient of killing the lower one off.

German Oversight

Reichstag building seen from the west, before ...
Head Office

Whatever the exact mechanism, it seems beyond dispute that the German parliament knew details of our budget before ours did. It may not have been the whole budget of course, but it still doesn’t look good.

Particularly in this context. What Merkel has proposed for the Eurozone is EU oversight of members’ budgets. Critics will say that that amounts to German oversight. So this is embarrassing even more for Germany than it is for Ireland.

How The Euro Exploded, Part 2

Various Euro bills.
Money. It's the root of all ****-ups

Why has the Eurozone gone awry? Why have the economies of Ireland, Greece and – it looks likely – Italy shot off the precipice like runaway trains? Well as in any transport disaster, several things had to go wrong at the same time. Yesterday we looked at Problem one, the credit boom. That was hardly surprising. The next piece of the jigsaw though may be a little more unexpected…

Problem two: The success of the euro. Mad I know, but in many ways the euro crisis was caused by it acting exactly as intended. It immediately improved the economic prospects of the poorer countries of Europe. Well, the poorer ones that were rich enough to join. Currency stability made the ‘peripheral’ economies attractive to money from the richer ‘core’. They became more profitable places to find investment opportunities.

But there were downsides. When a small economy with its own currency enjoys boom times, one immediate consequence is of course inflation. This reduction in the effective purchasing power of the currency generally causes it to drop in value – as if there was a divine law saying the more money you earn, the less it’s worth. But though that’s frustrating, it at least exerts some moderating influence on the economy. It wasn’t long before a strong currency was the very last thing the rapidly-growing peripheral economies of Europe needed. But adjusting it for their sake was out of the question, their interests were secondary at best. The primary goal of the euro, nearly its entire raison d’être indeed, was to be strong. With no possibility of the currency falling it was almost inevitable that these economies would badly overheat.

This was a foreseeable structural problem with the euro. Loosely-attached economies at the fringes were bound to get yanked about violently by the slow but inexorable movements of such a leviathan currency. Yet we still haven’t decided how to deal with it. Had the credit bubble not coincided, we might have had greater time to adjust and put compensating mechanisms in place. But with the bubble and the fluctuation-amplifying mechanism, well, what we got was bursting boilers and third-degree scalding.

And you know what’s the crazy part? With all this turmoil on the bond markets, with all this panic and fear that countries won’t be able to pay their debts, need international aid from the IMF, be forced out of the euro, you might be forgiven for thinking that the euro itself was in trouble. Yet it sails on, imperturbable, as strong as ever. Indeed, many would argue, quite overvalued. Which is really not what you want from the currency that you have enormous debts denominated in.

There is no escaping this: The euro was devised mainly for the benefit of the larger economies, and it is those economies that have benefited most. Yet it is we in the smaller and more vulnerable ones who are being made to suffer for its failings. Here, we’re even expected to return the investments that outside institutions made into our over-inflated property market – the very money that caused it to explode. They want it back.

The enormity of that has still not really sunk in.

Psychodrachma

Photo of a young Hoagy Carmichael, published b...
My name is Bond. Collapsing Bond

I woke up this morning with just one thought in my head: As James Bond does most of his work outside his home country, he should apply for an International Licence to Kill.

The subconscious mind is weird, yet annoyingly trivial.

Anyway, the G20. Thought this is basically just another of those international showcase conferences where everyone makes the right noises and little of real substance is done, it did act as a deadline for the EU leaders to have their house looking pretty. Like a station mass, if you will. So they – Sarkozy in particular, as host – were not well pleased when Greece crapped on the doorstep. Batting the EU leaders’ kind offer back with a referendum threat has sent the markets into turmoil once more, just when Sarkozy and Merkel wanted to impress the world with their authoritative grip on the situation. It makes them look helpless and incompetent, so naturally they are enraged. It is now all right therefore to talk openly about dumping Greece unceremoniously out of the euro.

Greece will probably not hold the referendum – there is severe doubt that Papandreou could win the parliamentary vote necessary to hold one anyway – but I am making plans in case the opposite manifests, and it returns to its own currency. It’s a nice place to live. It has weather and wine, as well as all the olives and history you can eat. And when its currency is free to float again it will float ever downwards, as their relaxed taxation chases after their optimistic expenditure. So if I move there, but live on what I’m making here, I’m going to be relatively wealthy – increasingly so indeed. I’ll hardly need to work at all.

So that’s my retirement sorted. Unless Ireland leaves the euro too, in which case I’m buggered.

Economics For Dummies

A Kouros, from the Archaic period. Archaeologi...
Beware Of Greeks Bearing Left

The Greeks played a game of brinkmanship and got a huge debt write-down from it. What did they learn from that? To do more brinkmanship.

So they’re getting a referendum on whether they’ll accept better terms, while we give it away without even a vote in parliament. €700 million to people who should, if they were treated like anyone else in a free market, have simply lost their money.

From this the banks learn that they can lend to people who can’t afford it and still make a profit, because those who did not the make the mistake of borrowing will be forced, by their government, to pay them back.

So what do we learn? That major international banks are our enemy, that the only way to fight them is to threaten the whole European economy, and our government is too supine to do that for us so the people will have to do it themselves.

Yes, some interesting lessons today.

Three Billion Between The Couch Cushions

Nuclear weapon test Mike (yield 10.4 Mt) on En...
You can't tell me that's not pretty

What’s three billion here or there?

Well… On the whole I think it’s better over here. If no one minds. Can I help you search for any more loose change? Whatever help you need, just ask. I’m not an accountant, but I could hardly be less competent than the shower you seem to have now.

Maybe it’s time to look more closely at the Department of Finance. While Ministers and Taoisigh must bear primary responsibility, the Department was the enabler of their problem. Could they be, you know, not actually very good? If they can just stumble across three billion here, how can we be sure that another few haven’t fallen through the cracks over the years?

Or maybe we could just forget about that for now and emphasise the upside. It’s three billion we didn’t know we had, the repayments we’re making on our children are already scheduled, so the obvious thing to do is get some real value out of it – with a big treat to cheer us all up.

As it should happen, today is the anniversary of the first hydrogen bomb – “For those times when ordinary nuclear weapons just aren’t enough”. Fifty-nine years they’ve been around, isn’t it high time we had one? And maybe a nice missile to show it in.

Then we’ll see how the bailout renegotiations go.