Sunday, January 21, 2018

Making Greece attractive to foreign capital

Protesters clash with riot police outside the parliament building during a demonstration against planned government reforms that will restrict workers right to strike in Athens, Greece, January 15, 2018. REUTERS/Costas Baltas
Protesters clash with riot police outside the parliament building during a demonstration against planned government reforms that will restrict workers right to strike in Athens, Greece, January 15, 2018. REUTERS/Costas Baltas

Reuters reported recently about protests in Greece against "reforms" demanded by the Troika of the European Commission, the European Central Bank, and the IMF:

"Greece’s parliament on Monday [January 15] passed a swathe of reforms demanded by international lenders in exchange for fresh bailout funds, a success for the government but a blow to thousands of people protesting outside.
The bill introduces a new electronic process for foreclosures on overdue loans and arrears to the state, opens up closed professions, restructures family benefits and makes it harder to call a strike.
About 20,000 people rallied outside parliament during the vote. Bus, subway and city rail services were disrupted and some flights were grounded as workers went on strike to protest against the bill."

My sister Barbara, who lives in Greece, commented in a letter to me:

"The consequences will be felt in the course of this year for many people in benefits, by auctions of houses, privatizations, restrictions on the right to strike, etc. The slogan of the government is: "just development ", which refers to making Greece attractive to foreign capital, the sale of ports, airports, railways, electricity, water, etc. while the population is kept alive by occasionally giving them some extra money in the form of a one-off benefit, alms, as it is called, but on the other hand to limit wages and benefits. And the brain drain still goes on ...."

Wednesday, January 17, 2018

The Dutch Have Solutions to Rising Seas. The World Is Watching.

I read an interesting article about Rotterdam and the Netherlands in the New York Times of which I will copy the first paragraphs below. I read it because of a a conversation I had with the director corporate strategy of the Port of Rotterdam. In preparing the interview I read a couple of articles and power point presentations about Rotterdam and the Paris Climate Agreement. Very interesting stuff!

ROTTERDAM, the Netherlands — The wind over the canal stirred up whitecaps and rattled cafe umbrellas. Rowers strained toward a finish line and spectators hugged the shore. Henk Ovink, hawkish, wiry, head shaved, watched from a V.I.P. deck, one eye on the boats, the other, as usual, on his phone.
Mr. Ovink is the country’s globe-trotting salesman in chief for Dutch expertise on rising water and climate change. Like cheese in France or cars in Germany, climate change is a business in the Netherlands. Month in, month out, delegations from as far away as Jakarta, Ho Chi Minh City, New York and New Orleans make the rounds in the port city of Rotterdam. They often end up hiring Dutch firms, which dominate the global market in high-tech engineering and water management.
That’s because from the first moment settlers in this small nation started pumping water to clear land for farms and houses, water has been the central, existential fact of life in the Netherlands, a daily matter of survival and national identity. No place in Europe is under greater threat than this waterlogged country on the edge of the Continent. Much of the nation sits below sea level and is gradually sinking. Now climate change brings the prospect of rising tides and fiercer storms. 

From a Dutch mind-set, climate change is not a hypothetical or a drag on the economy, but an opportunity. While the Trump administration withdraws from the Paris accord, the Dutch are pioneering a singular way forward.

It is, in essence, to let water in, where possible, not hope to subdue Mother Nature: to live with the water, rather than struggle to defeat it. The Dutch devise lakes, garages, parks and plazas that are a boon to daily life but also double as enormous reservoirs for when the seas and rivers spill over. You may wish to pretend that rising seas are a hoax perpetrated by scientists and a gullible news media. Or you can build barriers galore. But in the end, neither will provide adequate defense, the Dutch say.
And what holds true for managing climate change applies to the social fabric, too. Environmental and social resilience should go hand in hand, officials here believe, improving neighborhoods, spreading equity and taming water during catastrophes. Climate adaptation, if addressed head-on and properly, ought to yield a stronger, richer state.
This is the message the Dutch have been taking out into the world. Dutch consultants advising the Bangladeshi authorities about emergency shelters and evacuation routes recently helped reduce the numbers of deaths suffered in recent floods to “hundreds instead of thousands,” according to Mr. Ovink.
“That’s what we’re trying to do,” he said. “You can say we are marketing our expertise, but thousands of people die every year because of rising water, and the world is failing collectively to deal with the crisis, losing money and lives.” He ticks off the latest findings: 2016 was the warmest year on record; global sea levels rose to new highs.
Rowing teams practice at the Eendragtspolder, a site intended to be both a public amenity and a reservoir for floodwater.
He proudly shows off the new rowing course just outside Rotterdam, where the World Rowing Championships were staged last summer. The course forms part of an area called the Eendragtspolder, a 22-acre patchwork of reclaimed fields and canals — a prime example of a site built as a public amenity that collects floodwater in emergencies. It is near the lowest point in the Netherlands, about 20 feet below sea level. With its bike paths and water sports, the Eendragtspolder has become a popular retreat. Now it also serves as a reservoir for the Rotte River Basin when the nearby Rhine overflows, which, because of climate change, it’s expected to do every decade.
The project is among dozens in a nationwide program, years in the making, called Room for the River, which overturned centuries-old strategies of seizing territory from rivers and canals to build dams and dikes. The Netherlands effectively occupies the gutter of Europe, a lowlands bounded on one end by the North Sea, into which immense rivers like the Rhine and the Meuse flow from Germany, Belgium and France. Dutch thinking changed after floods forced hundreds of thousands to evacuate during the 1990s. The floods “were a wake-up call to give back to the rivers some of the room we had taken,” as Harold van Waveren, a senior government adviser, recently explained.
“We can’t just keep building higher levees, because we will end up living behind 10-meter walls,” he said. “We need to give the rivers more places to flow. Protection against climate change is only as strong as the weakest link in the chain, and the chain in our case includes not just the big gates and dams at the sea but a whole philosophy of spatial planning, crisis management, children’s education, online apps and public spaces.” TO READ FURTHER, click HERE

Monday, January 8, 2018

Global Financial Crisis - An opportunity, or a threat?

When those responsible for global financial policies say they want to avoid another global financial crisis, I do not believe them because a crisis suits both private capitalists and state capitalists (eg the Chinese). It gives them the opportunity to get "assets" such as ports (eg Piraeus) and other utilities at a low price, creates the legitimacy to reduce labour costs, dismiss workers and make their employment contracts more flexible and, more generally, allows them to prescribe and apply austerity policies.

Another reason why politicians were not really dissatisfied with earlier global financial crises that have occurred since the sixties of the twentieth century is that they created the opportunity to maintain the military supremacy of the United States. In each international crisis of the dollar the countries have taken the deliberate political decision to continue supporting the global financial system based on the dollar, thus financing the military costs of the US, or have been forced to support it since there was no alternative.

Do the euro and renmimbi threaten the survival of the global financial system based on the dollar? No. The European Union continues to support the dollar-based system, as it continues to support NATO, and China may say that it favours a larger role for SDR, but that is not a threat to the current system, nor is the incorporation of renmimbi in the SDR basket a threat.

Will the current global financial system based on the dollar be with us forever? Here we have the famous saying, I think (but I'm not sure), of a well-known Dutch central banker, Jelle Zijlstra: 'When we had a crisis of the pound sterling as the key currency of the IMS, we were able to move towards the adoption of the dollar. But, where can we go when there is a crisis of the US dollar? To the moon?'

However, I still believe in the possibility of transforming the current global financial system into a better system, eg by adopting an updated version of Keynes' proposal of an international clearing agency (see Jane D'Arista's upcoming book "All Fall Down: Debt, Deregulation and Financial Crises", and Jan Kregel's A Blueprint for Reform of the International Monetary System (2)).

Why do I believe that? Because at a certain moment it will be in the interest of those responsible for global financial policies to reform the system.

So far the poor have suffered from global or regional financial crises, while the rich have benefited from them. But that does not mean it will always be like that. Climate change is now seen by the rich as a threat.

When will global financial crisis be seen by global financial policymakers (businesses, central banks and ministries of finance) as a threat rather than an opportunity?

Saturday, January 6, 2018

The 'Sister' of Percy Mistry


Percy Mistry
For ten years, Percy Mistry was the man with whom I worked most closely within FONDAD. A friend of mine who worked at the World Bank said to me at the end of the eighties: maybe he will soon leave the World Bank and if I were you I would immediately contact him. A large number of books that I have published as director and editor-in-chief of FONDAD have been written by Percy (see Fondad publications by Percy Mistry).

But here I want to talk about his 'sister' or the lady he introduced to me as his sister when we saw each other again after 20 years, but who is actually his cousin: her mother is his father's sister, but the two families have lived in the same family building in Bombay and they grew up like sister and brother. Percy lives in Bombay for the winter part of the year, his permanent home is in Oxfordshire in the UK.

Percy and I saw each other back at CCI, or the Cricket Club of India. Just like at the Willingdon Sports Club we sat at a table on the lawn, a kind of outdoor terrace, and because there was a lot of noise and I was sitting next to Percy's sister, I had a conversation with her, while Aafke on the other side of the table had a conversation with Percy and his protégé who worked at the OECD. Percy has a serious illness and after half past eight in the evening is only capable of falling asleep or watching TV.

His sister told me about her mother who gambled money at horse racing, but she also told me about another cousin of hers who is committed to teaching children from slums. That cousin has already made thousands of slum (and disabled) children happy with education that was not only focused on learning but also on drawing and sports. And so for me, and later also for Aafke, the first-class lady became a lively, sweet woman with whom Aafke had a conversation about her youth at Catholic boarding schools in India and in Switzerland.

I still found a warm bond with Percy.

Monday, January 1, 2018

Bombay - Buying a SIM card

Mahendra and Aafke
At the exit of the cruise terminal they trudged around me, the taxi drivers. "Sir, I can take you to all the places you want to visit," "Sir, do you want to go to the Gateway?", "Sir, I can bring you to the Museum, it's very cheap."  
"Thank you for offering your services but I do not need a taxi," I kept answering. "I just walk to the traffic light to buy a SIM card."
It was a wide avenue that I walked from the gate, with high, thick trees on the left. There was little traffic. A man approached me and asked modestly if I might need a taxi. "Not now," I said, "but tomorrow. My wife and I are still on the cruise ship for another night and tomorrow morning we will go to our hotel and have an appointment somewhere in the city." " I can take you anywhere for $ 15 a day," he said. I looked at him a bit better, he looked back quietly. "Okay," I said, "can you be at the gate at 8 o'clock in the morning, then my wife and I will come with our suitcases?"
The next morning he walked towards us calmly and confidently. When we said goodbye to each other a week later at the airport, both Mahendra, Aafke and I had tears in our eyes. 

At the junction with the traffic light there was an open shop on the other side, actually more like a wide, open booth, like the one where Aafke and I bought a SIM card in Shanghai, with a man who constantly received smartphones that customers gave to him for a number of hours. I could only buy a SIM card with him if I had a passport photo, because forms had to be filled in with a photograph of me stuck to it. He told me where I could have a passport photo taken in the neighbourhood. 
I came to a photo shop, a pipe lettuce, with staff in the front, light section and in the back, in the dark, the boss. A calm, friendly and confident man, with whom I soon started talking about black and white photography, the development of negatives, the emergence of the image in developer, the type of paper that was our favorite - he sepia, I Record Rapid from Agfa - and the film rolls from initially 8 and later 36 photos. I still  have a few rolls in my closet and also photo paper, developer, fixer and tongs to pick up the wet, developed photo paper and first put it in a container with fixer and then rinse it in a bucket. But the conversation about those details was not until after he had taken off his pants and shirt and suddenly stood in front of me in half-length underpants and with calm and controlled movements pulled on a perfectly ironed shirt and white trousers to walk with me to a telephone store to buy a SIM card.  
He took me by the arm to cross a busy road and that's how I got my first lesson in crossing a street where cars on the wrong side run and crawl past each other alongside you. That lesson was useful later, when I crossed busy roads with Aafke. For me it soon became routine and an adventure without danger, because I saw that the traffic chaos and the drivers of the always honking cars, scooters and motorcycles respectfully interact with each other and with the pedestrians: they never bump against each other, even though it seems that they will do that every moment.
Together with the photographer I found a suitable telephone store. On the way back he told me about the beautiful sepia wedding photo he had of his parents, about his daily yoga exercises and the skipping of the evening meal, so he stayed so fit. He was 72 and I thought he looked younger than me. Later I introduced Aafke to him when she also had a passport photo taken to get an Indian SIM card. In the end she did not buy one: one working cell phone was sufficient.

Sunday, December 3, 2017

Triffin, Tinbergen and Preventing the Next Global Financial Crisis


When Robert Triffin died I asked Jan Tinbergen if I could interview him about Triffin. As Tinbergen had much sympathy for Triffin and was on the Board of Advisors of FONDAD, he immediately sent me a postcard saying he was sad to hear about the death of Triffin and would be delighted to talk about him. He asked me to call him for an appointment.

I went to his home in The Hague, in Haviklaan, a rather modest house where he lived alone (his wife had died). I had been there before. In one of my visits I had proposed to arrange a taxi for him to facilitate his attendance to a FONDAD Conference at the Ministry of Foreign Affairs. "Thanks for the offer," he said, "but I prefer to go by tramway." And there he sat quietly at a table when I entered the conference room on the morning the conference started. I greeted him, we exchanged a few words and later, when I welcomed other participants, I pointed at the man with white hair sitting modestly and quietly at the table. "Is he really the great Jan Tinbergen?" asked one participant.

Tinbergen and I had a long conversation about Triffin and I incorporated part of what Tinbergen said in an article I wrote for the Duch newspaper NRC Handelsblad, "Robert Triffin, een bevlogen monetair genie" - Robert Triffin, a passionate monetary genius. Tinbergen reminded me of the key role he had given to Triffin in preparing the Report of the so-called RIO Group chaired by Tinbergen. He had asked Triffin to write the first technical report included in the report ("Reshaping the International Order") about the need to reform the international monetary system.

Triffin and the next global financial crisis

In that NRC Handelsblad article, I also included memories of Triffin's activities by Johannes Witteveen, Emile van Lennep and Tom de Vries, whom I had interviewed as well. The first two were also on the Advisory Board of FONDAD. Emile van Lennep's conclusion was: "In the long run, I always see a Triffin problem: how can one prevent international inflation or deflation."

Van Lennep's conclusion is shared by members of Robert Triffin International (RTI), a think group about the international financial system to which I also belong. 

A FONDAD Group of 40 experts (FG40) is currently engaged in a discussion about how to prevent the next global financial crisis. I hope to inform you soon (within 3 months) about the outcome of that discussion. 

Below is the first page of the article in NRC Handelsblad I wrote about Triffin in 1993. On the picture you see a meeting of the so-called Bellagio Group of academics and policymakers, which was similar to meetings organised by FONDAD. Emile van Lennep and Robert Triffin were key members of the Bellagio Group. I felt honoured and supported when both Triffin and Van Lennep (and others including Johannes Witteveen) helped me in making FONDAD a successful policy research centre and international forum for policy discussion. It was a pity that the Dutch Ministry of Foreign Affairs stopped providing core funding to FONDAD in 2007. However, thanks to the enthusiasm and free of fee cooperation by members of the FONDAD Network we are still active. I am very grateful for that cooperation and hope it will contribute to preventing a next global financial crisis.

Tuesday, November 21, 2017

I have six blogs

I have six blogs and each of them plays a different role. This blog helps me to have a dialogue with people from the FONDAD network. I also use it for publishing articles by others and posts by myself on political economic issues. Sometimes I make summaries of what people in the FONDAD network are saying. 

I also have a blog, Tutto è possibile, in which I write in Spanish. It's the only one I use for maintaining a dialogue with my readers. It deals mostly with personal and emotional matters.
I think, read and write on these two blogs in several languages. I write in Tutto è possibile in Spanish and, rarely, in Italian. I think and write in Thoughts in English, Spanish and French. I read about politics and economics in English, French, Spanish, German, Dutch, Italian, Portuguese and, rarely, in Catalan.Besides Tutto è possibile and Thoughts I have another public blog, Wondertje. The last three Wondertje entries are:

   -
Reportage with a broken camera / Reportage with a b ...
   -
Emmen: 1948-1950
   -
Who are you? Diaries and self-portraits. New book by Aafke Steenhuis
   

The fourth public blog is Golfgroep where I publish from time to time things that have to do with the discussion group that we formed more than 25 years ago.
The other two blogs are for my literary writings and for the book project about ports in the world that my wife, Aafke Steenhuis, and I are doing.