[Mb-civic] What's Left

[Michael Butler]

------ Forwarded Message
From: Hawaiipolo at cs.com
Date: Thu, 22 Sep 2005 13:12:23 -0400
To: michael at michaelbutler.com

 

    What's Left?
    Three Elections, Three Outcomes
    By Stirling
Newberry
    t r u t h o u t | Perspective

    Tuesday 20 September 2005


Over the weekend, two of the core industrialized nations voted in national
elections, and they were joined by New Zealand, which, if it is not a major
economic player, is still among the world's most advanced economies. The
lens of left and right does not give a clear or accurate picture of what
was, in fact, decided. Which was very little.

    In Japan, Prime Minister
Koizumi went to the electorate asking for a mandate to break up the large
public corporation that, while it is called "the post office," resembles the
postal systems of a century ago, in that it is really a state financial
services and mail company. At that time, the postal system was used to
provide access to what we would now think of as banking services, as well as
delivery of mail. In most nations, things like "postal money orders" are the
remainders of the time when many people did their banking through the postal
system. Japanese politics lacks a left and a right as most of the world
understands it; instead, all of the major parties are pro-business parties,
with the dominant LDP party being a combination of rural subsidies along
with mercantilist economic policies. As many observers have noted, the
"Liberal Democratic Party" isn't really any of the three, but instead a
giant tent under which various important factions vie for control.


Koizumi's plan to break up the postal system - which includes insurance and
banking - had been stymied, not by the opposition, but by members of his own
party who worried that the loss of the state-run financial company would
hurt both their patronage and their constituents. Koizumi rolled to power
because many in Japan's cities, their savings locked up in low-paying postal
accounts, are hoping that a free market future would allow them to keep
better pace with inflation, and at lower costs. In Japan, the postal banking
system is used by the government to enforce industrial and monetary policy -
in effect, a giant tax on the public.

    In Japan, there was a decisive
result, and the public worries: they voted for liberalization of the postal
service, but they now realize that the LDP has an overwhelming majority and
the Prime Minister is the most personally powerful individual to hold the
post in decades. After 20 years of weak government, the Japanese are not
quite sure they are comfortable with the change.

    In New Zealand the
results were different - for years, the politics of that island nation have
been divided between several parties, allowing the Labour Party, which is a
neo-liberal left party, to govern even with a minority of the vote. However,
in this election the various parties of the right and right of center
finally merged into the "National Party" and were able to give Labour a run
for power. In the end, their appeal for "closer relations with the United
States" - a phrase we will hear again shortly - failed to carry the day.
Unlike the United States, New Zealand has seen robust economic growth over
the last few years, growth which has been broadly reflected in the society
at large.

    The last and most difficult election to interpret was held in
Germany. The ruling left of center coalition - the "Red-Green" alliance -
was voted out of power, but very little else can be said with certainty.


Some background will help, however. Chancellor Schröder came to power at the
wrong moment: in 1998. He had only two years of general prosperity before
the downturn associated with the global stock market crash and financial
crisis of 2000-2002 was upon him. Thus, he did not have a mandate to blame
the past and redo everything, but instead undertook a policy of gradual
change. These policies have failed to deal with mounting unemployment,
pressures on the German social system, and the inflationary pressures that
are, largely, the result of American Federal Reserve pressures. With the
restrictions of the European Monetary Union, he could not spend his way out
of the problem as the previous Christian Democratic government under Kohl
had done, nor could he use monetary policy, since that is under the control
of the European Central Bank. This meant that he had only one lever, and
that was to reduce the regulatory burden on German industry and hope to
export more and produce at lower costs. However, he was attempting to do
this without wholesale changes to Germany's egalitarian social system.


His challenger, Angela Merkel of the Christian Democratic Party, was billed
as a German Margaret Thatcher, ready to go in and take the ax to state-run
industries, slash tax revenues, and obliterate worker protection laws.
Needless to say, the Wall Street Journal editorial page had turned her into
this year's political pinup girl. For most of the race she held a huge lead,
only to see it collapse as the public realized that she was not merely a
more business-friendly version of the present, but wanted to bring in "Der
Flat Tax" and other changes which most Germans see as dangerous to both
social equality and to the way of life, centered around an industrial
Germany, that has been the heart of the national economic identity for 150
years.

    The election results seem to be designed to produce deadlock:
225 seats for the CDU and 61 for the "Free Democratic Party," an even more
free-market party than the CDU - which, totaled together, are 21 seats short
of a majority. But the election becomes much easier to understand by looking
at the other part of the equation. The other three parties in the lower
house of the Bundestag will be the SDU, with 222, the Greens with 51, and a
new party, the "Left Party," composed of former communists and the left
flank of the SDU.

    What this result and Schröders's insistence on being
chancellor show is the nature of his political gamble. The new feature in
the political landscape is the "Left Party," whose votes have largely come
from the SDU and the Greens. Schröder gambled that by dumping the left flank
of his own party and forming a grand alliance with the CDU, he could push
through soft liberalization, accepting neither Merkel's radicalism nor the
full weight of the blame for a condition that he inherited. A grand
coalition would leave both of the major parties responsible for the results,
and give neither an advantage in the period of prosperity to come.

    That
gamble is half way to paying off. Merkel did indeed collapse in the polls,
and the one person who can prevent this gamble from working is Joschka
Fischer, the foreign minister and member of the Green Party. The stumbling
block to the Greens' crossing the aisle is precisely that: any Merkel
government would have to make exporting to the US a top priority, even to
the extent of undercutting other members of the European Union. The price
for this is what Merkel called "closer ties to the US." This is code for
"supporting George Bush's policy in Iraq," since that is the price for any
major nation to have closer ties with the Bush executive.

    Fischer,
however, is the architect of the continental European policy of avoiding
precisely this entanglement, while still being deeply involved in the NATO
war on terror in Afghanistan and other locations. To join what has been
called "the Jamaica government" - after the colors of the three parties that
would make it up - he would have to lay high explosives to his major
accomplishments as foreign minister, and become, in effect, Condoleezza
Rice's tour guide around Berlin. It is a prospect that the very proud
politician will find difficult to stomach.

    This means that the future
of German politics rests on who - Merkel or Schröder - can command personal
loyalty. While Merkel has the first road to the Chancellorship - by
persuading the Greens to join the government - it is Schröder who has the
last, because a minority government of the left could stand, since the Left
Party could be persuaded to support the government from the outside, if the
alternative is a hard turn to the right. Merkel, on the other hand, would be
facing three parties eager to bring her government down on the first
misstep, as soon as her leadership faltered.

    Looked at from the broad
picture, the question that was put to three different electorates was really
very much the same, how to liquidate many of the specific promises of 20th
century left-of-center politics, without disrupting the larger promise of
universal participation in the benefits of a national economy. In the end,
all three electorates voted to continue this process, but slowly, rather
than with shock therapy. Observers in Europe have already pronounced
Merkel's economic plan dead, and point to the size of the left vote as a
clear indication that, while the demands for a free market Germany have a
growing vocal base of support, it is still a minority position of the
electorate as a whole.

    The pressures on other nations to play to the
Federal Reserve's tune are growing, because of the triangle of the United
States, OPEC and China. OPEC supplies oil, which allows the US to build
houses, which increase the money supply, which allows the US to buy cheaper
manufactured goods from China, and more oil. The profits from this are
dumped back into the United States, where they become more money for lower
mortgage rates, which allows the cycle to repeat. Increasingly, the rest of
the world is being pushed out of the cycle, with the exception of those
nations that produce oil. Norway is flush with cash, and the UK economy is
being buoyed by high demand for oil.

    Other nations are facing a clear
and sharp division of the future. Either they must accept much higher energy
prices in their own currencies, or they must export to the US to get enough
dollars to buy energy. Since there are no new supplies of energy that can be
brought on line quickly, this pressure has been most acute in those nations
with no energy supply and no easy ability to pull in higher paying jobs from
other nations: South Korea, Brazil, France and Germany are all wounded
economically, not so much because of government policies, but because of the
global financial pressures on their economies.

    So far none of these
nations has found an economic formula that will allow it to cope. The
failure of the European Constitution has pushed the pressure down on to
individual nations in Europe. The first casualty of this is Turkey's
entrance into the European Union. Turkey, as a source of cheap labor, would
be welcomed in an expanding Europe, but in a Europe that is struggling to
create jobs, it is suddenly a threat to the constituencies of major
governments.

    Koizumi and Schröder, in different ways, have gambled very
big. Koizumi on releasing the pent up funds in the postal system, hoping to
produce a domestic boom, and Schröder by backing the CDU into a corner and
liberalizing Germany enough to manage the current squeeze. Because, of
course, the oil triangle has its own problems: OPEC cannot pump more light
oil, the US consumer is close to giving out, even as the US government is
hemorrhaging money fighting two wars and rebuilding the Gulf Coast. And
while China has received a great deal of hype, it has an insolvent financial
system, and more people living in poverty than there are people in Europe;
China's own restive population will not tolerate a large slowdown in an
economy that is already experiencing double digit inflation.

    And in
three nations, Germany, New Zealand and Japan, the decision, while it took
different forms, was to play for time, rather than joining in what Daniel
Altman has called the "neoconomy." The pressure to cave in will grow,
however, here in the United States; the willingness to pursue the root
policies of the neoconomy - including perpetual occupation of Iraq, falling
real wages, little job growth, rising commodity prices, and an increasingly
corrupt political system - are fading. There may not be a "next time" for
the attempt to neoconomize Europe.



------------------------------------------------------------------------
--------
    Stirling Newberry is an internet business and strategy
consultant, with experience in international telecom, consumer marketing,
e-commerce and forensic database analysis. He has acted as an advisor to
Democratic political campaigns and organizations and is the co-founder,
along with Christopher Lydon, Jay Rosen and Matt Stoller, of BopNews, as
well as the military affairs editor of The Agonist. 
  -------

  Jump to
today's TO Features:    
 Today's TO Features t r u t h o u t  Roberts for
Life? t r u t h o u t  Mayday Mississippi Delta t r u t h o u t  Cindy
Sheehan: One Mother's Stand -------------- FEC Sues Pro-Republican Political
Group Molly Ivins | An Ill Wind That Can Blow Texas Some Good Woolsey
Hearing Begins Debate on Exit Strategy Schroeder Vows to Stay as Germany
Enters Limbo Ex-Tyco Executives Sentenced to 8 1/3 to 25 Years in Prison
Ex-Iraqi Defence Minister Wanted over $1bn Fraud Fitrakis and Wasserman |
How the GOP Stole America's 2004 Election and Is Rigging 2008 The Endless
Ending of the Taliban in Afghanistan Stirling Newberry | What's Left? Bush
Suspends Affirmative Action for Gulf Contractors Bush Proposes Private
School Vouchers for All Displaced Students Sheehan: 'Katrina Proves America
Not Safer' Stephen J. Fortunato Jr. | Roberts Bad on the Basics Nominee for
Immigration Chief's Credentials Questioned Robert B. Reich | Bush
Administration Paradox Explained Simon Wiesenthal, 'Conscience' of
Holocaust, Dies Harry Reid to Vote against Roberts Michael T. Klare | More
Blood, Less Oil Former FEMA Chief Brown Bought Votes in Florida Five
Soldiers Killed in Three Separate Iraq Bombings Ex-White House Official
Charged with Obstruction -------------- t r u t h o u t  Town Meeting t r u
t h o u t  Home 

  Print This Story  E-mail This Story

 
 
   
  © : t r u
t h o u t 2005

| t r u t h o u t | town meeting | issues | environment |
labor | women | health | voter rights | multimedia | donate | contact |
subscribe |

 




------ End of Forwarded Message