Tuesday, December 30, 2008

Time to get back at it

Uhhhh. Sorry. Just shaking off the cobwebs. I've hardly read a newspaper in a week, barely even saw 20 minutes of televised news. So, not much to offer on the big doings of the day (or week) - yet.

Tuesday, December 23, 2008

Losing our competitive edge

Economists Anthony Leddin and Brendan Walsh explain why being in the Euro is such a problem for us and advise potential applicants - Iceland, Poland, Denmark, etc. - to have a good look at Ireland before making the leap.
Between 2000 and 2003, the Irish economy suffered a 30 per cent loss in price competitiveness relative to all our trading partners taking both exchange rates and relative inflation into account. This loss of price competitiveness hurt domestic export and import-competing firms, leading to a fall in the growth rate and inflation but placing the economy closer to a sustainable trajectory.

An independent Central Bank of Ireland would undoubtedly have started the adjustment process earlier - raising interest rates as inflation rose and unemployment fell. But, as a member of the European System of Central Banks, the Irish authorities were limited to sounding unheeded warnings in the Quarterly Bulletin.

… Contrary to what was required under Irish conditions, the ECB cut interest rates from 4.75 per cent to 2 per cent between 2001 and 2003. Given the high Irish inflation, the result was negative real interest rates which added fuel to the already unsustainable boom.

… Following two years at a sustainable growth rate in 2001/02, the economy again picked up and the real growth rate averaged 5.3 per cent per annum between 2003 and 2007. Unemployment averaged 4.5 per cent and another 290,000 net new jobs were created. But inflation remained well above the EMU average and price competitiveness continued to deteriorate.
They don't argue that we should leave the Euro, but an obvious sub-text here is that we probably shouldn't have joined in the first place.

Friday, December 19, 2008

Thursday, December 18, 2008

Thanks Dave

A friend of mine sent me a present. A hat. Not just a hat, but a hat with the symbol of the #7 subway line on it. The 7 train is the Flushing line, the train to Shea Stadium Citi Field (sigh). It's also the first line I was ever on - we lived along the 7 line when I was a little kid.

And, unfortunately, I've recently been noticing the cold on my head a bit more than in years past. The once-thick-thatch on the top of my head is not providing the warmth it did in years past. So my new hat is perfect.

Where were you in 1500?

The Irish sure have scattered. Of the descendants of people living in Ireland in 1500 only 12% are in Ireland today. 76% are in America.
Using the McEvedy and Jones (1976) estimates of populations in 1500, the Penn World Tables 6.2 population estimates for 2000, and the matrix’s estimates of origins, we find that there were 31.6 million descendants of the Irish population of 1500 alive in 2000, with less than 12% of these living in Ireland, 76% in the US, 5% in Australia, and so on. In contrast, the vast majority, although not all, of the descendants of China’s year 1500 inhabitants live today in China.
Not earth-shattering, but kind of interesting.

Can we take the euro-pain?

It seems like a lifetime ago, but it was only in January when Matt Cooper was asking the question: 'Is it time to leave the euro'?

I've always thought the decision to join the euro was wrong. Why? Well, it was all due to an economics lecture I attended in 1992. The topic was the currency. According to the lecturer (can't remember his name right now) being part of the single currency or not was not a major issue, but it would be catastrophic if we joined and Britain didn't. Well, looks like he knew what he was talking about.

I was reminded of all this last night watching George Lee's report on the news last night. He never mentioned the possibility of leaving the euro, but anyone listening to him had to have that question somewhere in their head? Can we endure the pain that being part of the euro is causing?

I've mentioned this to a couple of people and they all come back with references to Iceland. And, yes, Iceland is a scary example. Okay. How 'bout this? It makes more sense for us to have a single currency with the UK than with the rest of the Eurozone? That's almost heresy, I know, and bordering on a topic I never touch here, but really we'd better off with Sterling than with the Euro. Our economy more closely matches Britain's than Germany's, France's or Italy's. We can rejoin the euro when (if) the UK joins.

We should rerun two EU Treaty referendums next year: Lisbon & Maastricht. A 'Yes' to Lisbon and 'No' to Maastricht might set things right.

We're too small ...

That's the gist of Ivan Yates's column this morning. Too small for anyone in the EU to really take our complaints with Lisbon seriously. Just too small.
While they respect our sovereignty and right to self-determination, this has not extended to allowing one of the smallest and most peripheral states to dictate to the rest of Europe how EU procedures should be reformed.

They are not prepared to reopen the ratification process of the treaty within their own respective states. They are unwilling to revisit their parliaments or electorates with an additional protocol — let alone alter the treaty. Some may argue that our Government didn't try hard enough. Whether this is true or not, it is wholly irrelevant because we now have to face the collective reality of "no renegotiation".
I admire that honesty and believe there's a lot of truth in it. Look, the pro-EU forces in Brussels and in the various EU capitals were more than happy to engage in a bit of trickery - basically changing the title on the EU Constitution - to override the French & Dutch 'No' votes in 2005. That they'd have little patience with us is hardly news.

At least Yates is willing to admit the full truth; many on the 'Yes' side are not. We have no say. Not really. Not in how the rules are made. All we get to decide is whether we agree with the new rules whenever they're changed or we can leave. That's it.

Yates continues his pro-Lison argument saying that these treaty referendums are not the place to take out your frustrations on the government. That's true.
A constant characteristic in the vox pops of no voters was a "whatever you're having yourself" disenchantment. If you were fed up due to the smoking ban, drink driving rules, economic recession, Dustin's Eurovision defeat, fishing and farming woes, taxation system, health cuts or tribunal revelations — you found the referendum a suitable repository for your angst.
However, he's wrong about fishing & farming woes. Those two industries can obviously point to EU rules and regulations as having an impact on their profitability. That means those who are interested in farming and/or fishing are right to take an interest in the Lisbon Treaty and to make a case for or against.

I also believe that someone who is opposed to taxation laws being changed to mirror those in France or Germany can be at least concerned about the increasing centralization of power in Brussels. It defies belief that we can keep integrating - not just our economies, but almost all aspects of governing - without some equalization* in the tax laws. And, as Yates notes, when the big boys decide the time has come for forcing the tax laws to be essentially consistent throughout the EU, again, we'll have little say in how those new rules are written. We can agree or we can leave.

* Equalization is not the word I was looking for, but it didn't come to me.

Tuesday, December 16, 2008

Highest turnout since 1968? Maybe.

Today's NY Times says that with all districts reporting "61.6 percent of Americans eligible to vote went to the polls this year, the highest since Richard M. Nixon beat Hubert H. Humphrey in the close 1968 race". This year's turnout was a bit better than in 2004, when turnout was 60.1%. Okay, but ...

In 2004 the total ballot was around 122.3m and this year it was 125.2m. What I find interesting is that with those vote totals that means the base population was the same in both instances - 203m. That means that turnout is (probably) based on the census of 2000. That makes no sense to me seeing as the population changes over the years after the census. That means you can only really compare turnout between elections in years ending with the same digit. {E.g. 2008 with 1988 and 1968, 2004 with 1984, 1964, etc.}

I stand by my belief that turnout was not really greater this year than in 2004.

RTE & the Irish Times on Ganley

I finally watched the Primetime report on Declan Ganley* last night. I was actually expecting it to be much worse. Maybe an Irish viewer would have been more alarmed by Ganley's American colleagues? I don't know, but I found them to be likable guys. I thought they were straight shooters too.

Sure, some of Ganley's 1990s dealings in E. Europe might be a bit shady (maybe), but I wonder how many businesses dealing in the former Soviet states just after the fall of The Wall were any different? Even big companies operating there were probably engaging in 'local customs' when it came to some business dealings. Overall, despite the sinister music and tone I actually thought the criticisms were mostly pretty thin and those who defended Ganley were credible.

Funny enough, after I watched the interview I picked up last Saturday's Irish Times where I found this column by Noel Whelan. Whelan has a go at Ganley too and, to be honest, I think his criticisms may be closer to the truth. Whelan's argument is that Ganley is simply on an ego trip and the "he's sinister" stuff is a distraction. Could be right that Ganley's on an ego trip. But what harm?

* I'm not sure if the videolink to the report will work outside Ireland.

Thursday, December 11, 2008

Mets in peace

For that special Met fan in your life, the gift of a (after)lifetime.

The "Best" has come and gone

Marc Coleman writes for the Sunday Independent and is the Economics Editor (I think) at Newstalk. Anyway, for reasons I can't explain I have something of a soft spot for Coleman. Maybe it's pity? I don't know, but if I didn't have this 'soft spot' I'm sure I'd make sport of him frequently. Recently he's been saying the economy's in bad shape, etc., but he was pretty late to that game. When other economists - George Lee & David McWilliams to name two - were warning us that things were starting to unravel, Coleman was still talking things up regularly. He released his book - The Best Is Yet To Come - at the end of 2007.

Why do I bring this up? Only because I read this article from The Spectator and the essence of what it says seems frighteningly possible to me. Jonathan Ruffer's column could have been titled, "The Worst Is Yet To Come".
The Americans allowed a depression to develop in the 1930s because they were afraid of the consequences of losing the principles of sound money. In an effort to avoid a re-run of the 1930s, the Western world is imposing the opposite, equally unbalanced and intemperate solution. We might thereby avoid a depression — but the bad stuff which follows currency compromise will crash down upon us with great vigour. This is the one and only one, and probably last, shock that the credit crunch has yet to impose on a still unsuspecting world.

Roy Keane — "Enraged by the jejune"

Only the New York Times. Even its blog wants to sound a cut above. I'll admit I enjoyed John Doyle's blog/column from the Times's web site, but really? Jejune?

The gist of what Doyle had to say is that Keane's rise and fall exactly mirrored the Irish nation's fortunes.
Uncannily, just as Ireland lurched from Tiger economy to stark recession, seemingly with nothing saved, nothing learned, Keane spent too much and gazed at a shambles of his own making, before he just resigned and walked away. Now, the economic bubble has burst in Ireland and Keane seems fallible.

At that, every Irish person is unnerved. Everyone projects dreams and meaning into the celebrities and sports stars we admire. But with Keane it was even more profound - an entire country obsessed about him and a nation’s psyche, all its pride and enterprise, seemed to reside in him. He is us. We are him. As he goes, so do we. The Celtic Tiger is tamed.

Wednesday, December 10, 2008

The Land of Lincoln

Illinois is a place apart when it comes to politics. According to Kathleen Parker, "[t]hree of the past eight governors have spent time in jail or prison". Current Governor Blagojevich is bidding to make it 50%.

Still, I kind of find it reassuring. The charges against Blago are so old-school. And, although the language might be a bit salty, I doubt his words would have been out of place coming out of the mouths of many of the old Tammany Hall Mayors. Yes, reassuring.

Monday, December 08, 2008

Why did I throw away my ham?

We hit the panic button yesterday. And, by we, I mean everyone living in Ireland. We were told to throw away all our Irish pork products and we did. We did this even though we were reassured that there was no real health scare risk in having eaten potentially contaminated pork/ham/etc. We were advised to throw away all such products bought since September 1.

When I first heard this I almost thought it was a joke. I mean, how much pig meat have I already eaten since September 1? Loads, but don't worry because there's little health risk. So, why do I have to throw away the ham and pork chops that are still in my fridge? Surely if there's little to worry about after 3 months of eating the stuff, one or two more portions are hardly going to matter. Right? Or not?

This has been bothering me for the past 24 hours. Finally, I think I understand. This drastic measure has virtually nothing to do with the consumers' health and all to do with the pig meat industry. The dire warnings to convince us to dispose of (almost) perfectly good meat - unless we're being lied to about the risks - were to reassure us that when we return to the supermarket or butcher that the pork or ham we buy is 100% top of the line, nothing to be concerned about.

I didn't come to this revelation by myself. I had to be practically hit over the head by Dr. Patrick Wall, formerly of the Irish Food Safety Authority and former Chairman of the European Food Safety Authority. Dr. Wall was on Liveline and he first laid out the case for how low the risk to consumers is and then explained why the meat had to be recalled.

The government basically was afraid repeating Belgium's 1999 chicken problem. In that case the Belgian government played the whole thing down and waited a long time to reveal what it knew, feeding the fear when the story first broke. Their poultry industry was badly hit.

The Irish government was determined not to duplicate that experience. Ireland is a big exporter of food, which makes this sort of scare even more damaging potentially. So, they hit the nuclear button. I don't know why they couldn't explain that the food was contaminated, but could be safely eaten if you really wanted to. Instead, we were all encouraged to throw €10, €20, €30 worth of food away. And, throwing food away drives me nuts. I could have eaten those last few slices of ham.

Friday, December 05, 2008

The Barmaid and the Minister

Hmm. These are different times. A barmaid and the Belgian Minister for Defense, Pieter De Crem, are caught up in a scandal, but it's not what you might think. No, the scandal is that the barmaid was fired for blogging about the Minister's boisterous behavior in the New York restaurant where she worked.

Look, the restaurant owner is perfectly within his rights to fire this woman. And, if I owned a restaurant or bar I'd like to think that my customers would at least be safe from the employees blabbling about what went on. Other patrons? Well, that can't be helped.

At the same time, I can't read Flemish, but her post seems innocent enough. Considering the Minister was in New York he should be happy enough that the Cindy Adams wasn't in the same place or it would have been a much bigger deal for him. So, although I can understand (maybe) why the restaurant owner fired this woman, Mr. de Crem (the crumb?) has gotta get real.
Mr de Crem went on threaten legal action against bloggers and warned Belgian MPs "every one of you is a potential victim".

"I want to take this opportunity and use this non-event to signal a dangerous phenomenon in our society," said during a debate last Friday.

"We live in a time where everybody is free to publish whatever he or she wants on blogs at will without taking any responsibility. This exceeds mud-slinging. I find that it's nearly impossible to defend yourself against this."
Come on! How precious is he? He's a government minister for God's sake and he's moaning because he was caught having too much fun (a problem for the Flemish?). What he did was hardly a big issue, but he turned it into a big issue. Why he couldn't have just said that he might have let his hair down a little too much while in New York is beyond me. He's an uptight so and so who doesn't like the fact he was spotted behaving this way.

And blogging has nothing to do with it, really. In the past the barmaid might have passed this tidbit onto a gossip columnist, but nowadays everyone does their own reporting.

Tuesday, December 02, 2008

Fly Pottersville Air

It's Christmas time and Michael O'Leary is making another bid for Aer Lingus. Ever notice how much O'Leary's portrayal in the press makes him seem like Mr. Potter from It's A Wonderful Life? Aer Lingus is the Bailey Building & Loan. Only the truth is it's O'Leary who's serving the "rabble", flying people around for next to nothing, which is something the press seems incapable of accepting.