Grandmaster level chess

In chess, the quality that separates the ‘grandmaster’ from the ‘talented amateur’ is the number of moves ahead that each player can mentally keep in mind and manipulate. Something similar is said to be true for champion tennis and snooker players.

I am not one for conspiracy theories as experience has to date shown me far more evidence supporting the ‘Murphy’s Law’ theory of management of human affairs.

None the less, there are in all realms, whether jurisdictional or professional, at any given time a handful of competent persons with both a breadth of vision and a depth of ability.

The ‘European Project’ was built by men widely adjudged to be ‘political grandmasters’. Adenauer, de Gaulle, Brandt, Mitterand, Delors; none of these were, or are, regarded as vain or shortsighted or incompetent. Patiently and with great care and at considerable cost and in the face of much dissent, the various layers of the EU have been put together.

Yes, there have been many compromises and the ‘project’ is far from complete and the final form is not clear to anyone. But there was a vision behind the efforts of these men and there was, most certainly, a bitter awareness of what the possible costs of failure could be and what the outcome of failure would look like.

In the context of all that wisdom, ability and effort we now have to re-examine the crisis that envelopes the ‘European Project’. The ‘design flaws’ in the single currency were clearly enunciated before its adoption. The bumpy evolution of the ERM gave ample warning of how tough life might be for some members of the monetary union.

The driving ambition of the proponents was not merely to enhance European trade or the reduce the profits of foreign exchange traders. They did not seek some empty token of pseudo-unity for Europe.

What they wanted was a means of preventing a repetition of the abuse of power and the greedy expropriation of financial wealth that the US imposed on the rest of the world when it unilaterally and with warning or dialogue abandoned the Bretton Woods agreement in 1971.

The only way to achieve this would be to build a currency with the strength and depth of the ‘mighty dollar’.

That level of integration has always been regarded as politically impossible to achieve and, in many ways, has been ‘tabu’ to both those who would propose it, as well as to its instinctive opponents.

Nobody ‘walks the plank’ out of choice. Standing at the end of the plank, one jumps into the water because certain death awaits at the other end and there is some hope, however slight, amongst the fish and the sharks.

The designers were well aware of the risks and the flaws of the design of the Euro. They had knowledge of, and personal experience of, financial disasters of national and supra-national scale and impact. A crisis of the type we are currently dealing with was inevitable with only it’s timing as a matter of debate. Almost certainly it has come sooner than most observers expected and has probably been brought on and exacerbated by the US debt crisis.

We are now hearing calls for the ‘federalization’ of problem debts from predictable and from most unlikely sources. Of course, no one mention the corollary of this federalization which would have to be federal tax raising powers. At which point the EU project would be complete.

There is an alternative to the disintegration of the Euro and the EU as a solution to the unviability of the debt mountain that has been piled high in the storehouses of Europe. And as solutions go, while unpalatable to many, it looks less painful than the alternative.

So I leave you with this thought and a quote.

Did the designers of the Euro hope to achieve, through a crisis, a level of European integration that would never be possible by normal negotiations?

“And whether or not it is clear to you, no doubt the universe is unfolding as it should.”
– Desiderata by Max Ehrmann

First published on the Progressive Economy blog by TASC on Friday, July 11th, 2011.

DD,SS.

Greetings and apologies for the long silence. It was engendered by a preoccupation with other delusions and a generalized despair at the “state o’ chassis”.

My congratulations to EK and the gang on an interesting victory.

EGilmore shot himself badly in the foot at the start of the campaign with his arrogance toward the electorate in general and, again, in the immediate aftermath with his arrogance towards women in particular.

I have much to say about FF and the Greens but I was taught not to speak ill of the dead.

EKenny ran a careful campaign, much mocked but perfectly rendered and made a fine, indeed a very fine, speech on assuming office. It transcended most people’s expectations of the man and the moment.

Sadly, I fear that such transcendence will be short-lived. EK is already being slapped around by his EU seniors. Overall, the situation reminds me of the inauguration of BObama. The situation is extremely parlous and almost all options have been squandered by the outgoing administration, making the task of the incoming administration Sisyphean and bound to disappoint.

Lets face it, folks. He cannot walk on water, despite our hopes and ambitions for him. He has been dealt an impossible hand and in the coming months I will not condemn him for not being a miracle worker nor any of his colleagues.

We are riding the whirlwind now.

Good News?

There is little new under the Sun and precious little of that is good news but the uprisings in the Middle East are both.

They are novel in that they genuinely seem to be popular uprisings unmediated by elites or provocateurs. They are good news for those of us who believe liberty and self-determination.

It is a measure of American hypocrisy that after 30 years of expensively propping up the Egyptian client dictatorship that they are now urging accommodation and reform while keeping the money spigot flowing. It may also be a measure of American weakness that they have so quickly jumped on the bandwagon.

There are always concerns about how these uprisings evolve. If they descend into revolutions then it becomes impossible to predict the outcome as all sorts of opportunists interfere and manipulate to suit their preconceived agendas. If they lead to bloodless displacements, as in Tunisia, then we may hope for the best.

I believe that once freedoms are granted they are very hard to remove save in cases of near complete state failure such as Afghanistan has endured for 30 years. So, let us hope for swift and bloodless popular coups everywhere that American satraps have lingered for so long and that Arabs can show Bush et al. what ‘Let Freedom Reign’ is really about.

It would certainly be wonderful to see another ‘domino effect’ of dictatorships toppling in succession as we saw in 1989. There is unlikely ever to be a better time for the Arabs. America is weak in blood and treasure after two stupid wars and a property bubble. Russia has not fully recovered and China has not yet established itself.

I don’t think this good news for oil consumers, though.

More Farces

It is 15 months ago since the GreenParty held a Special Convention on PfG/NAMA.

I told that Convention that I did not believe that any of the lovely promises offered to them as the payoff for sustaining FF in power and agreeing to NAMA would be delivered, let alone the fact that they were not worth the price that NAMA was being quoted at, let alone the price that NAMA was going really cost.

The vocal minority that I was proud to be a part of lost that argument.

Today, after the Greens have bolted from a Government that they solely had enabled, we have been proved wholly correct.

There is no ban on corporate donations, there is no Climate Change bill, the incinerator is still going ahead. In the last year the Greens have passed an EU mandated change to marriage contracts, a change in dog breeding and deer hunting laws and, erm, that’s about it.

The cost has been the utter loss of our ‘reputation’, the emptying of the State coffers and the exodus of the young.

Green incompetence has cost them dearly. Showing their hand in November started the avalanche of resignations and other electoral posturing that has derailed their legislative agenda and the entire Government with it.

Now we are being offered a General Election.

This GE is a much of a farce as the machinations which have led to it. Elections are usually fought (and ought to be) over what direction the voters think that the country ought to go in over the coming years from between the choices offered by the competing parties.

But what alternatives are on offer to the people – FF, FG and Lab are all endorsing the G’tee, NAMA & the EU/IMF bailout. There is nothing for the people to choose from. There is nothing to do except settle down and pay bills for 10years or emigrate.

The Greens, despite their much vaunted democratic principles, have robbed the people the chance to choose their destinies and are now forcing the timing of the peoples rubber stamping of the Greens arrogant choices on the people’s behalf.

The best thing that could happen would be the abandonment of the Finance Bill and someone, anyone, offering a policy of burning the bondholders and repudiating the Guarantee. It would be painful but it would be a lot quicker than the pain we are going to endure over the next decade. The most important thing is that it would be sure. The economy would be repriced to competitive levels (back to 2000) and we could stop being the source of Europes debt-gangrene.

Good luck now.

Qui bono?

Once again I was wrong because I did not think ‘things’ could get any stranger.

Mr. Cowen has resigned as leader of FF but intends to remain as a caretaker Taoiseach, all the while citing the benefit of the Nation principally and his party secondarily as the intended beneficiaries of his actions.

But who can possibly gain from this refusal to go on drinking from the poisoned chalice of the Taoiseach-ship?

Any new leader of FF will not be able to bring about any changes of policy because they will not be in office and have scant chance of it after. But to announce new policies will mean repudiating the work they did and supported immediately heretofore.

The new leader will be tarred with the brush of these current failures as well as the unlamented and lamentable Mr. Cowen. So FF will suffer a double loss of leadership over their current incompetence, which is possibly no more than they deserve but is still not helpful for them.

Legally, there should be no obstacle to the idea of the Taoiseach not being the leader of the largest party but the semiotics of this at this juncture are unhelpful. The people and the markets need to see a steady firm hand on the tiller and at this stage a dead hand is preferable to a skittish new unpredictable one.

Mr. Cowen should have done his duty and continued to quaff deep draughts from the poisoned chalice that is his Taoiseach-ship. Instead, he has added to the count of bungled maneuvers and bolted when the normal political processes needed to be reaffirmed and have him stay on to take his reprimand from the people.

Despite all his protestations, this maneuver has be undertaken for the benefit of his party primarily. It will shortly be seen as such and will be another nail in the coffin of FiannaFail. The only remaining issue is how many more will it take to ensure that the beast can finally be buried for evermore.

New Year’s Wish

Greetings and a happy New Year.

In an Irish context, the ‘and prosperous’ addition to the traditional salutation is inappropriate. I have been shocked at the number of people who have contradicted or corrected me when I used the full traditional form of the greeting. Clearly, a very sombre mood has settled over the country as everyone now realizes the scope of our problems and uselessness of the ‘remedies’ applied so far.

I have spared the readers (all 6 of you, according to Google) any mutterings over the festive season mainly because I was having some fun but also because events were moving so fast and so farcically that any comment of mine was superfluous.

On the cusp of the Fianna Fail ‘heave’-let I have little to say that has not been said before by me and better by others. The old are eating their young in Ireland or at a minimum the hopes and dreams of their young. It is a terrible Swift-ian nightmare that we are living through with vampire banks, zombie political parties and predatory priests roaming the land.

But it also true that people get the politicians they deserve. FF were voted in in 2002 and in 2007. Legally, they have done little wrong apart from a consistent negligence but there is no court that would convict them.

The morality of their conduct is a moot topic when it comes to political parties in general and FF in particular but one can say with some certainty that they had no mandate for the changes they have imposed on the electorate and they have gone to great lengths to avoid seeking one.

My own party, the Greens, make themselves more hypocritical and farcical by the hour. Lately, they have described themselves as ‘semi-disengaged from Government’ while desperately propping up the Government and staving off the General Election in order to drive through legislation that is of concern only to themselves. Pontius Pilate was never this good at public hand wringing/washing.

The short term outlook is worsening by the day.

Capital is fleeing the country at an accelerating rate. The Central Bank is resorting to stratagems that would be considered fraudulent in any other bank. Inflation, through the price of energy, is increasing. The General Election seems sure to be a repeat of 1983 with an inconclusive result dominated by ‘independents’ and unlikely to be stable or enduring.

I sent out a New Years greeting to friends saying that “I wish you all the health, strength, luck and pluck needed to face the coming challenges and that you may end the year with more friends than you start with.” I repeat that good wish to those of you who did not get it via SMS.

I wish you luck this year. You are going to need it if you live in Ireland.

Status Update

The reader will be aware that up until now I could be described as being, emotionally, somewhere between ‘pissed off’ and ‘very, very angry’.

I have now moved on to being just plain scared.

All of Europe’s political elite are living  in a ‘Wonderland’ where they believe they can defy economic gravity by printing fiat-money debt. Granted the EU and the Euro are fantastic feats of political will but this is a case of “Ye canna change laws o’ physics, Jim…”

America is unravelling fiscally and poltically.The domestic economy is imploding despite more QE, the Republicans have morphed into theologians and the Democrats into war-mongers.

Mexico is about to become a net oil importer and thereby lose it’s foreign exchange earnings at the same time as its ‘narco-war’ is intensifying. Similar outcomes are expected in some of the other minor oil exporters.

In Cancun the bickering about not addressing the on-rushing climate catastrophe is going round in circles while adding more data points to the ‘hockey stick’.

It feels like we are repeating the Great Depression. A massive contraction started in the US and was compounded by bank collapses in Europe two years later in Europe. And, yes, there is an overarching debt burden between different sections of Europe, this time between the periphery and the core instead of between Germany and France. Nor are we short of would-be demagogues and racial problems for them to exploit should the hardship worsen.

Yes, I am now just plain scared.

Political Culture – Part 2

I was at a meeting of political ‘types’, from the Government side of the fence, a short while ago.

In the general discussion that preceded the ‘ business’ of the meeting, I brought up the subject of the dramatic rise in the suicide rate and, in particular, the awful murder/suicide in Cork that occurred recently.

There followed a long discussion on the awfulness of it, the sadness of it, the stupidity of doing it over money or status and the tragedy of the absence of or loss of services to remediate it.

But not one person hinted, suggested or admitted that the decisions that they had promoted, instigated or agreed to had brought about the losses, debts and fears that were driving these people over the brink of despair.

They have blood on their hands but they are not aware of it. I guess that is how they can sleep at night.

Oh!, the joys of the ‘unexamined life’.

Political Culture

There is a fascinating article in the FT today wherein the truly hypocritical nature of the political culture of Ireland and its dominant party, Fianna Fail, is laid bare, almost accidentally.

It is worth a read but two quotes stand out.

“I voted for Fianna Fáil in the past simply because I was getting favours done on planning,” Mr Duffy adds. “But no more.” He is now shifting his allegiance to Sinn Féin.

Mr Duffy, the builder, adds: “You see the true colours of Fianna Fáil coming out now, after years and years of scratching people’s backs and siphoning off money. They’re rotten to the core and people are fed up with them. They [have] not a hope of getting my vote.”

The 4-year conflation.

Too little, too late and with the wrong orientation and emphasis.