Archive for the ‘Uncategorized’ Category

Easter in Italy

April 6, 2016

Norcia 1

Norcia 2

I won’t pass any comment.

These two were taken in Norcia, in the south of Umbria.

The Thin Controller

March 21, 2016

Osborne weight loss

George Osborne, who I used to call The Fat Controller, has become the Thin Controller after eating less and running more. But he is still Sir Topham Hat, insensitive nemesis of poor Thomas the Tank Engine (and all other members of the working classes).

In case you missed the Thin Controller’s latest, last week he decided to reduce taxes for the rich and the middle classes at the same time as chopping a further £4.4 billion over five years from the budget to support disabled people. The Institute for Fiscal Studies estimated that 370,000 people with a disability would lose an average of £3,500 a year. This comes on the back of an already-implemented big squeeze on various direct and indirect forms of welfare support for the disabled.

Most of the groundswell of anger at the Thin Controller — he has already abandoned the disability benefit cut in a standard ‘oh my god, what have I done this time?’ volte-face  — focused on his increase to the level at which higher earners begin to pay the 40 percent income tax rate. However this change has at least the merit of rewarding middle class work.

What gob-smacked me in the Thin Controller’s budget was the decision to make big cuts to already ridiculously low rates (compared to income tax rates on work) of Capital Gains Tax (CGT). Britain is fast becoming a rentier society, but the Thin Controller’s determination to turn us into some proto-feudal squirearchy seems to know no bounds. He cut the lower band of CGT from 18 percent to 10 percent, and the higher rate from 28 percent to 20 percent.

The old rates do remain in force for profits on one’s second, third, fourth and fifth, etc homes (i.e. for non-primary real estate). However the adjustment is a huge bung to the share- and bond-owning leisure class, of which I regard myself as an aspiring member. Thinking today about whether I should not perhaps take the next three months off and go on safari, I decided to check the HM Revenue and Customs web site and learn more about the Thin Controller’s commendable policy to encourage my indolence. Here is what I found:

<Policy objective>

<The government wants to create a strong enterprise and investment culture. Cutting the rates of CGT for most assets is intended to support companies to access the capital they need to expand and create jobs. Retaining the 28% and 18% rates for residential property is intended to provide an incentive for individuals to invest in companies over property.>

This statement has three great qualities. First, it is pure gibberish. Companies (the supposed subject of the second sentence) do not pay CGT, they pay Corporation Tax. Second, it is dishonest. Following from 1., what the Thin Controller really means is that he wants to support the stock-owning rentier class, who don’t need to work because tax rates on passive capital invested in shares and bonds were already low, and are now even lower. Annoyingly, he can’t actually say this, but we know who we are. Third, the statement is misguided. This is because no British rentier with half a brain is going to invest much of their unearned capital in British companies when the Thin Controller has created such an anaemic growth environment. One gives one’s capital to American companies like Apple, Amazon, Skyworks, Gilead, Amtrust Financial Services, American Express, American Tower, Verisk Analytics, and so on. (Disclaimer: oh yes, I own them all.) And then one pays sod all tax to the Thin Controller on the profits. Of course, in the final analysis this doesn’t matter because the Thin Controller doesn’t need the tax because he’s dismantling the welfare state.

Got it?

 

On journalism

March 17, 2016

Tombstone cover

Yang Jisheng, author of Tombstone, a forensic account of the Great Leap famine that killed 30-40 million Chinese, just won a prize given by the Nieman fellows in journalism at Harvard. So he has written them a nice little piece on how he thinks about journalism. Of course the Chinese Communist Party wouldn’t let Yang go to America to collect the prize…

I cannot upload the Harvard page directly into WordPress because the typeface is not supported. So click here to read an English translation of what Yang wrote, or to find a link to the Chinese original. If you are a journalist you might want to print the document and stick it on the bathroom wall.

 

Siberia

March 2, 2015

On the way to town from Krasnoyarsk airport, I ask the lady from the foreign ministry about the only two buildings I plan to set foot in in this city in eastern Siberia: the hotel, and the conference centre.

‘Beautiful,’ she says.

‘Beautiful?’ I repeat. ‘Do you mean the hotel is beautiful, or the conference centre is beautiful?’

‘Everything is beautiful,’ she clarifies.

We enter the city and I am conscious of the sound of people eating breakfast cereal, loudly, outside the car window. The eating stops and starts again each time we stop and start at a traffic light. After a while I realise that this is in fact the sound of the little nails on the car tires that enable vehicles to have traction on ice.

Arriving at the hotel, the nice lady from the foreign ministry insists on helping me to take my luggage to the room. We enter. ‘Let me see how your view is,’ she says. She pulls aside a curtain and peaks out: ‘Very good.’

Later, I take a photograph that approximates to what she was looking at.

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It is thus that I arrive for the XII Krasnoyarsk Economic Forum, of which the 2015 theme is Economic Integration with Asia (Mr Putin, you remember, having fallen out with everyone in Europe).

Since the organisers have invited many more people to speak than there is time for, I am asked to reduce my remarks to a maximum 15 minutes. That equates to about one minute for every thousand kilometres of round-trip travel, but still constitutes top billing. After the Plenary Session, there is a High Level Luncheon, to which very few people turn up. One of those who does speaks loudly into his mobile phone as I am asked to say a few more words.

I am not sure that I understood anything that was going on at the conference.

Possibly, people in business were intimating that the central government does not do much governing.

Fortunately, the bigger point turned out to be that there was time before I left for the foreign ministry lady to give me a tour of key Krasnoyarsk beauty spots.

Paramount among these is a hill with a very small, windmill-shaped church from which Krasnoyarskians enjoy panoramic views of their city.

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We were at this Elysium on a Friday, which is one of the days (along with Thursday) when people like to get married, since it allows for the requisite three- or four- day weekend of drinking.

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Descending to the city, we stopped at the bridge over the Yenisei (one of the Three Great Siberian Rivers, along with the Ob and the Lena), which is so famous that it appears on the 10-rouble note. (That equates, following the latest devaluation, to the 10 pence note.)

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Not far from the bridge, the Soviet-era water pumping station is being restored for the benefit of future generations.

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At the other end of town, the second-most famous beauty spot in Krasnoyarsk is another bridge. The foreign ministry lady told me that in the summer romantic couples stroll across it in droves.

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You just have to try to imagine the droves.

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Naturally enough, there was another wedding couple there.

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Nearby is a triumphal arch erected in 2003 to celebrate the 375th anniversary of the city’s founding. (This appears to be the first anniversary to be architecturally commemorated.)

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The arch will make French people think of Paris. As a British person, my favourite landmark is the iconic Krasnoyarsk time-piece known as Little Big Ben.

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There is a train from Krasnoyarsk to Moscow. It takes three-and-a-half days.

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I travelled by plane, which takes just five hours. To Moscow.

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As I was leaving, I noted in the VIP lounge of Krasnoyarsk airport that management has been quick to amend the map on the wall to include Crimea and its administrative centre, Simferopol. I wondered whether the contractor has yet prepared a piece for the eastern Ukrainian (should I say Western Russian?) region of Donbass.

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I hope you find these images of the best sights in Krasnoyarsk useful. Before my visit, Internet searches under terms such as ‘Krasnoyarsk best sights’ failed to elicit anything.

 

New year’s resolutions wanted

December 30, 2014

Two articles pasted below remind us how far China has to go before it can be deemed a ‘developed’ country.

First, from the 29 December Washington Post, the well-known Chinese lawyer Teng Biao says that China under Xi Jinping has no serious commitment to rule of and by law.

Second, from Caixin, Sheila Melvin recounts the story of Hu Feng, a writer and Party member whose belief in the rights of the individual within a socialist state brought him into head-on collision with Mao Zedong and the doctrines set out in Mao’s Yan’an Talks. It is the utilitarian logic of the state as representative of the ‘mass line’ that continues to make rule of law impossible in today’s China.

China’s empty promise of rule by law

By Teng Biao December 28 at 6:52 PM
Teng Biao is a human rights lawyer and a visiting fellow at Harvard Law School.
During the year that is drawing to a close this week, much has been made of the Communist Party of China’s new emphasis on “governing the country according to law.” But those who imagine that fundamental reforms will flow from this rhetoric would do well to remember the warning that Foreign Ministry spokeswoman Jiang Yu gave in response to questions about the legal justification for a 2011 incident of press mistreatment: “Don’t use the law as a shield.” I don’t understand why some are so willing to believe what the party says while disregarding what it does.

This is hardly the first time the Communists have raised the banner of “rule of law.” Even before they seized power and established totalitarian rule, they promised liberty and constitutional democracy. In 1997, the idea was written into the report delivered at the party’s 15th Congress, and in 1999 it was written into the Constitution. But that same year saw the savage repression of the Falun Gong. Since President Xi Jinping came to power, hundreds of rights defenders and intellectuals have been thrown into prison for political reasons. Properties have been expropriated or demolished, free speech has been restricted, religion has been suppressed, women have been forced to have abortions, and torture has multiplied. In Xinjiang and Tibet, the authorities have carried out one shocking human rights catastrophe after another. The abuses have never stopped.

To the Chinese Communist Party, “governing the country according to law” does not mean rule of law as you and I understand it. The essential element required for rule of law — using the law to limit the power of the government — stands in ideological opposition to the purpose of the party. In reality, the rule of law that the party talks about is “Lenin plus Emperor Qin Shi Huang” — modern totalitarianism combined with pre-modern Chinese “legalism.” It is nothing more than a tool to further control society. Rule of law is always superseded by the rule of the party, and there is not a shred of doubt about this.

The legislative organs controlled by the Communist Party have promulgated volumes of statutes. The judicial organs, also controlled by the party, are busy with cases. The legal professions have been developed. But is the law at the center of the governing order?

As University of Hong Kong law professor Fu Hualing has pointed out, many extra-legal processes — and extra extra-legal processes — stand above and apart from the law. These include shuanggui (an extralegal detention and interrogation system used to enforce discipline within the party), media restrictions, house arrest, secret police, “black jails,” chengguan (a para-police force that works with police across the country to enforce minor city rules and regulations), spying on citizens, torture, disappearances and Internet police. Without such tools, how long could the Communist Party continue to rule?

This year’s “governing the country according to law” is just another attempt by the party to address its crisis of legitimacy. Such slogans may help the party fool people within China and the international community. But legitimacy can come only via recognition given through free elections, and here the party is stuck. Clinging to one-party rule, it completely rejects general elections, even in Hong Kong. True rule of law would mean the end of the one-party system. This is the limitation on the legalization process that cannot be overcome.

Over the past 10 years, I and other human rights defenders have consistently sought to use Chinese laws to carry out our human rights work, and occasionally we’ve had success. But the limitations are obvious. Whenever the authorities begin to feel a threat from civil society, they move to suppress it. I have had my lawyer’s license revoked, been expelled from my university and been kidnapped several times. When the security police were torturing me, they shouted: “Don’t talk about any of this law stuff with us.”

In enumerating the progress being made in China, some observers have pointed out the falling number of death sentences, a new criminal procedure law, the abolishment of re-education through labor, reform of the local courts, the government’s willingness to release more information and the ongoing anti-corruption campaign. But it is questionable whether this represents progress. And even if it does, the major driving force for these changes has been not the party but the people — each change a result of pressure by rights lawyers, democracy activists and countless Chinese on the lower rungs of society.

Xi Jinping once talked about locking up power in a cage, but this is not much different than a magician wrapping an iron chain around himself. In reality, what party officials would like to do, and are doing, is to lock the people in a cage. Sycophants are able to imagine a “spring” for rule of law that doesn’t exist only by ignoring human rights disasters suffered by Ilham Tohti, Xu Zhiyong, Cao Shunli, Gao Zhisheng, Uighurs, Tibetans, petitioners, Falun Gong adherents and house churches.

This kind of selective blindness has prevented Western readers and politicians from understanding the reality in today’s China. It’s no surprise that this type of seemingly even-handed wishful thinking has become the excuse for Western governments to adopt short-sighted policies of appeasement in dealing with autocratic regimes and for favoring trade over human rights.

 

In praise of Hu Feng

By Sheila Melvin

Hu Feng (1902-85) is a name that most students of PRC history have undoubtedly encountered at one time or another. I remember reading it for the first time years ago in Jonathan Spence’s “The Search for Modern China.” It stuck in my mind because back then I found it incredible that a nationwide campaign could have been launched against a lone writer who was himself a loyal member of the Communist Party, his only “crime,” in essence, to suggest that China’s creators and consumers of culture needed a little space in which to breathe.

Later, I heard Hu’s name in a more personal way from my friend and teacher Gui Biqing, because her beloved younger brother, Wang Yuanhua, had been an associate of Hu’s, both men active leftist writer/critics from Hubei working with the League of Left-Wing Writers in pre-liberation Shanghai. One day in 1955, Shanghai’s chief of police asked Wang to admit that Hu was a counter-revolutionary – warning Wang that if he did not, the consequences would be “severe.” Wang spent a long sleepless night in detention and the next day told the police chief that he did not consider Hu a counter-revolutionary. He was thus declared a member of the “Hu Feng counter-revolutionary clique” and jailed for the prime of his life; his wife was punished, too, and later, in the Cultural Revolution, even his sister, my teacher, was locked-up for eight months.

But, beyond the bare bones of his case and my teacher’s stories, I knew little about Hu Feng and always felt that I should learn more. The opportunity recently presented itself when I came across Gregor Benton’s 2013 English translation of “F: Hu Feng’s Prison Years,” a 1989 memoir by Mei Zhi – Hu’s wife, an established writer in her own right – that recounts in gripping, heartrending detail the Kafkaesque detentions, disappearances, and arrests to which her husband was subjected by a Communist Party so intent on crushing those who refused to tow its line that it ate its own, destroying the best and brightest intellectuals of an era.

Hu Feng was a product of the May Fourth Movement and a disciple of Lu Xun, a committed leftist who believed that literature should inspire social transformation and reflect reality, but who also insisted on the role of the individual in the creative process. In the lingo of the era, he supported “subjectivism” and argued that artists and writers should not be dictated to and controlled by political bureaucrats – instead, they should be granted some autonomy so they could actually be creative.

This stance earned him enemies early on – well before 1949 – but he refused to back down, instead warning that a blind insistence on obedience to Party dictates would turn China into a “cultural desert” and founding several literary journals – like “July” and “Hope” – in which he promoted the works of like-minded young writers (among them the poet Ai Qing, the father of Ai Weiwei). Hu’s beliefs became increasingly problematic after Chairman Mao gave his speech at the Yanan Forum on Arts and Literature, in which he decreed that “There is no such thing as art for art’s sake, art that stands above classes, art that is detached from or independent of politics” and after which the Party began exerting ever tighter control over writers, artists – and the individual in general.

Nonetheless, Hu survived the transition to the PRC and was appointed to the editorial boards of the prominent journal People’s Literature and the Chinese Writer’s Union. He used these positions to promote professionalism, criticize the nation’s stagnating intellectual life, and decry the idea that writers could only focus on the lives of workers, peasants and soldiers – didn’t other people’s lives matter, too? In March of 1954, he drafted a 300,000 word “Report on the Real Situation in Literature and Art Since Liberation” and submitted it to Xi Zhongxun – the father of current president Xi Jinping, who then supervised cultural policies for the Party – who reportedly welcomed it. For good measure, Hu appended a long letter to the Politburo complaining that he had been ostracized and deprived of his right to work, and asking them to intercede.

Chairman Mao did not respond well. On the contrary, he personally helped launch a campaign against “Hu Fengism,” which was rolled out nationwide to drill home the dictate that every individual must subsume his will to that of the Party and the State. Members of Hu’s “clique” – most of whom he had never met – were rounded up and arrested. Hu and his wife were taken away in the middle of the night while their three young children slept – she was imprisoned for 70 months and he for 10 and a half years. Mei Zhi’s account opens at this point, in 1965, when she has heard nothing from her husband for a decade and fears he may be dead – but he isn’t.

Out of the blue, she is informed that she can visit him at Qincheng Prison. “Ten years without ever seeing someone dear to you. What will he be like? Will he be the man of my dreams? Will I recognize him?” They talk about family and, inevitably, politics, since she is under intense pressure to make him confess and repent, even though she knows he won’t – “Hu Feng didn’t know how to play it safe and always ended up saying what he thought, so he became the victim of an unprecedented onslaught.” Hu bemoans all the people who were implicated and suffered because of him but steadfastly maintains his innocence. “I was always being told to confess but I had nothing to confess,” he tells her at one point, at another, “I have not lost faith in the Party.”

The visits continue – she brings food, but he wants books, so she lugs him a Japanese edition of the complete works of Marx and Engels – and finally he is released. He sees his children, now grown, they celebrate Chinese New Year and plan to rebuild their lives. The reader sees the Cultural Revolution coming like an impending train wreck, but they do not. They are sent to Sichuan – for their own safety – and live in exile, carving out a life together even as they are sent to ever more remote areas. Then, in 1967, Hu is arrested again and Mei Zhi is left to fend for herself in a mountain prison camp. When Hu is returned to her five years later, he is a man broken in body and spirit, afraid even to eat a tangerine: “If I eat that, they’ll denounce me.” He leaps to attention in the middle of the night, calls himself a murderer, spy and traitor and becomes increasingly paranoid. “I would restore him,” Mei Zhi vows. She makes progress, but after the death of Zhou Enlai, which leaves him sobbing, he worsens, hearing voices talking to him through the air and threatening her with a kitchen knife while imagining he is trying to save Chairman Mao. She begs him to recover: “If you can survive, we will have won. You must live.”

He does live, he is freed, he is exonerated. And then his body betrays him, just as his Party had, cancerous cells devouring his heart. “How he longed to stay alive!” Mei Zhi, ever faithful to the man for whom she has sacrificed so much, promises him, posthumously, to “spend the rest of my life washing the remnants of dirt from your face and showing your true features to the world!”

Mei Zhi is gone, but her mission remains important – Hu Feng still matters and his case is well worth our study. Artistic and literary expression still sometimes get writers and artists detained, and jailed – and, in the worst cases, innocent spouses suffer too, just like Mei Zhi. Hu’s ideas also remain critically important. Debates between those who advocate the May Fourth Spirit and those who prefer something closer to Mao’s Yanan vision remain very much alive – and Yanan, in recent years, is gaining ground. President Xi has called for “innovation, innovation, innovation” and the Chinese government has done much to promote the creative arts. But history has proven that Hu was correct – real innovation and creativity can happen only when artists and innovators are given the space and the freedom to test their own ideas, express their own creativity, and make their own mistakes, without fear of punishment. We should all continue to support Mei Zhi’s quest, and learn from Hu Feng.

 

Black-eye Fridays all round

December 19, 2014


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Of all the great Cambridge traditions — wearing silly capes to dinner, jumping in the river, spying for the Soviets — Black-Eye Friday is surely the finest spectacle. On the last Friday before Christmas (today!) the good townspeople of the city remind us of their presence by getting as drunk as possible and fighting in St Andrew’s street, between Downing and Emmanuel colleges.

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So seriously is this tradition observed that a special medical team from the 254 Medical Regiment Army Reserves is called in to attend to the wounded. A legion of Black-Eye Friday ‘street pastors’ roams the city through the night, sweeping up broken glass, offering flip-flops to inebriated women in high heels, and ‘reasoning’ with those who just want to get on with a good fight. Police gobble up precious overtime and get to tell people to ‘spread ’em’ against the railings of Emmanuel college (through which those detained can conveniently vomit while awaiting their fate).

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So far the build-up to the most violent day of the year has been auspicious. Sub-editors at the Cambridge News were gifted the most prized headline in journalism before dawn on Monday when a man involved in a violent altercation allegedly bit a dog before dying of a heart attack.

In mid-week, the News sent its crime reporter to test the waters of St. Andrew’s street and he was pleased to report on a large-scale drunken brawl between a group of men dressed in Christmas jumpers. In a separate incident, a pastor offered a blanket to a young, insensible woman whose lower half was clad only in a pair of black lace knickers; she told him to go away, explaining that she had ‘come out like this’. Sadly, the News declined to publish photos of these interesting incidents.

Global link with Chinese food reference

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But it is not only in Cambridge that people are getting black eyes today. Over in Hong Kong, spooky-looking mega-billionaire Thomas Kwok, of Sun Hung Kai fame, has been found guilty of bribing the man who was about to become the second-most powerful politician in the territory (FT sub needed). Tommy might well be sent for a bit of prison congee when sentencing happens next week.

It is all rather shocking. The judge apparently failed to understand the Asian culture of gift giving, in which a consultancy retainer while holding public office, a couple of rent-free flats and an interest-free loan are simply ways of saying: ‘Hello, how are you?’ The sort of treatment that has been meted out to church-going born-again Christian Tommy suggests that almost any act of friendship can be called into question — as, for instance, when uber-billionaire Li Ka-shing gave retiring HSBC chief executive Michael Sandberg a metre-high, solid gold statue of the HSBC headquarters building. Thank god that black-eye Friday is only one day a year.

More from Hong Kong

Bloomberg details testimony from the trial about money, mistresses and paranoia. The ransom paid to Big Spender, who kidnapped elder brother Walter, was also stated in the trial, as HK$600 million. (Big Spender later kidnapped Li Ka-shing’s eldest son, Victor. It is all in Asian Godfathers…)

 

Ferguson versus Perugia

November 27, 2014

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As Ferguson, Missouri smoulders (literally and figuratively) following the decision not to indict a police officer who shot an unarmed black man dead, it is interesting to read Joshua Rozenberg’s opinion piece about the systemic failings of the arcane grand jury system that is still used in around 20 American states. It was a grand jury that decided not to indict the police officer.

What leaps out at me are the similarities between the functioning of grand juries (which only decide if there is a case to answer) and the functioning of Italy’s actual court system, as seen in the Sollecito-Knox satanic ritual murder trial in Perugia, about which I have blogged a great deal (see the ‘Italy to avoid’ tab).

The basics of a grand jury are that the prosecutor decides which witnesses to call and which witnesses to grant immunity from potential prosecution. There is no screening of jurors for potential bias and no objections can be raised about the choice of jurors. Proceedings, framed by the prosecutor who asks the questions (there is a theoretical right for jurors to ask questions at the end of testimony), are held entirely in secret and the grand jury decision is final. A longer outline of grand jury rules is here. Mostly it is the good ole boys of the south who still use grand juries, but a good number of supposedly more liberal states in the north-east do too; see here.

Well, if you look at the Sollecito-Knox satanic ritual murder trial in Perugia, several things that shocked me were: no capacity to screen jurors for bias, prosecution framed by the prosecuting magistrate (Giuliano Mignini) without any independent oversight, and jury deliberations framed and overseen in camera by the presiding judge rather than taking place independently. I am not saying this is a perfect analogue, but the excessive power granted to prosecutors and the lack of transparency do appear to be commonalities.

Of course in America the problem afflicts the indictment system in some states. In Italy it afflicts the entire national judicial process.

 

Later:

Here is another recent grand jury, in New York, failing to indict police officers over the death of a black man who was put in a choke-hold, and kept in one despite saying ‘I can’t breathe’. It was all captured on video. Coverage from the FT (sub needed). And here is coverage from The Guardian of protests in many US cities against the decision not to indict; again, the video of the police action is embedded.

Tits and bums

November 24, 2014

Oh, so now you’re paying attention.

In the past couple of weeks I have posted blogs that seemed to me important. About the Xi Jinping-Obama understanding on emissions that paves the way for a global deal to arrest climate change in Paris next year. And about Adair Turner’s argument that governments may have to print money to pay for fiscal expenditure and monetise part of their debts if we are to head off another asset bubble by raising interest rates while at the same time avoiding global economic depression.

Well, these momentous developments have garnered little more than the usual rate of traffic on this blog. So, looking at email addresses of the several hundred people who now subscribe to every single post (dear oh dear), I note that most of you are academics, researchers, money managers, NGO-types and ‘activists’. So it occurs that what you really want is a bit of gratuitous demi-porn to take the edge off your lives of monotonous intellectual mind-wrestling.

Fortunately I am in a position to indulge you. The peg is the recent APEC summit in Beijing, which was important not just for an apparent meeting of minds between the Chinese and US presidents, but also for an alleged pass made by the Russian president, Vladimir Putin, at Xi Jinping’s wife.

Personally, I don’t think there is much to it, although Putin is now officially a single man, which puts him (even more) firmly in the frame in terms of motive. However the extraordinary reaction of Chinese censors, who moved immediately to expunge any trace of Vlad’s let-me-get-your-coat-darling moment from the Chinese Interweb, reminds us that in Chinese Communist Party cultural terms Vlad was indeed on quite thin ice. Here, side by side, are the photo (similar to the one below) briefly posted by Chinese state news agency Xinhua and, to the right, the notice you got shortly after/still get at the same URL saying in Chinese that the page has been deleted.

Obama to Xi: 'Looks like Ukraine is not the only thing Vladimir wants to get into.'

Obama to Xi: ‘Looks like Ukraine is not the only thing Vladimir wants to get into.’

And here is a brief story from Foreign Policy about the whole incident, including a link to video if you really want more.

The Putin-Peng Liyuan (yes, she has a name) frisson got me thinking, as I am sure it has you, about the broader subject of global leaders hitting on other leaders, their wives and partners. So here, in no particular order, are some memorable moments I have been able to come up with:

 

1. Henry Kissinger’s ever-penetrating analysis. These must surely be among the most famous images of the genre, as Henry first enjoys a full frontal review of Lady Diana’s strategic assets, and then follows up from behind with a sly ass-check.

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2. The Brezhnev. But did you know that back in 1973 Kissinger’s own date, former Bond girl Jill St. John, was subjected a famous occular eye-over by the leader of the Unfree World, Leonid Brezhnev? In the photo below you can almost see Brezhnev calculating out the potential upside of detente with the Americans. Coincidentally, it was in 1973 that Kissinger was quoted in the New York Times saying that: ‘Power is the ultimate aphrodisiac.’

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Here is a shot that shows Kissinger (back to camera) and Jill as another guy (described in Walter Isaacson’s Kissinger biography as a ‘naval aide’) gives Jill’s ass a caressing gaze too.

Brezhnev and Jill St. John at Nixon Pool Party

 

 

 

 

 

 

 

 

3. Size doesn’t matter. Deng Xiaoping. There is no killer photo here, just various official ones like that below. However, when Ronald and Nancy Reagan visited China in 1984 and were received in the Great Hall of the People, Deng said to Nancy (in range of the foreign press corps): ‘I hope you’ ll come the next time and leave the president home.’ After translation, the ever-cool Ron batted the remark away.

Deng XP Nancy R and Ron R

 

 

 

 

 


 

4. Obama-Gucci Helle. These images are so recently famous they hardly bear posting. Except to tee up the less well-known 5., below. Here Obama flirts with Danish prime minister Helle Thorning-Schmidt, known to her countrymen as Gucci Helle for her rather un-Danish love of branded designer clothing.

obama helle 1

 

 

 

 

 

 

 

And here is the US president after a bollocking from his wife, who was sitting on the other side of him all along. (There is another image of Brave Dave Cameron forcing his way into Helle and Obama’s selfie, but it is just too depressing to post.)

obama no-helle michelle

 

 

 

 

 

 

 

5. Obabma and Lil sis’ Yingluck. Now here is the collector’s item. It is Obama and Thaksin’s little sister Yingluck, who was running Thailand after Thaksin was thrown out in a coup, at least until Yingluck was also thrown out in a coup. What was that song about ‘One night in Bangkok’?

Obama Yingluck

 

 

 

 

 

 

 

 

 

To be fair to Obama, however, I think the story may have been that it was young Yingluck who was providing the come-on.

Obama Yingluck 2

 

 

 

 

 

 

 

Vacuous China

November 21, 2014

Xi Jinping’s anti-corruption campaign shows no sign of abating, with admirals and generals fearing for their futures as much as mere civilian bureaucrats and Party cadres. Meanwhile Xi’s vicious clamp-down on dissent goes on apace, with more human rights lawyers being themselves tried on trumped-up charges and Internet censors now firing blunderbusses at great swathes of the webosphere. Today, Ilham Tohti’s life sentence has been confirmed by an appeal ‘court’ that held its ‘hearing’ inside his detention centre.

So, what better time to discover a video of Chinese rich kid students in California flaunting their Bentleys, Maseratis, Porsches and more?

Are you watching, Mr Mao?

 

A little clear thinking

November 18, 2014

I am posting a number of documents by Adair Turner relating to the concept of ‘helicopter money’. The term was coined by Milton Friedman and refers to the idea of simply dropping money into an economy to expand the monetary base without any commitment by a government or central bank to ‘pay’ for the money. Indeed, the point is to increase money supply, possibly permanently, in order to pay for government expenditure.

Printing money to cover a government’s bills is never going to be an easy policy to sell. But Turner has bravely put this option on the table because the place to which the major economies of the world are heading under current policy may actually be worse.

How so? Turner’s point is that the policy of central banks expanding their balance sheets and flooding financial markets with cash to force down interest rates to zero is merely fuelling asset bubbles – in real estate, in stocks, and even now in things like fine art. What the world needs is a return to somewhat higher interest rates to head off another speculative bubble and bust (selling some Apple shares yesterday at 18 times earnings and more than four times what I paid for them reminds me we may already be in bubble territory). The problem, of course, is that higher interest rates cannot come at the expense of another collapse in the demand in the real economy and hence a spiral of 1930s-style deflation. Logically, as Turner argues, the only option may therefore be to expand the monetary base, create a bit of inflation to allow a meaningful rate of interest, and simultaneously use the printed cash pay off some government debt and fund expenditures that maintain real economic growth.

Such a policy would (probably) put the fiscal boot on the other foot compared with the past six years. Almost all UK and US policy since 2008 has favoured those with assets – real estate, stocks and bonds — as asset values have been restored by the near-zero interest rate policy. If rates rise, those who hold assets under leverage will pay more debt service and asset prices will come under pressure. On the other hand, a positive real interest rate gives those with only a bit of cash (the young, the poor) some return on their money in the bank, while money creation can pay for lower taxes on work and investment in things like infrastructure. In other words, such a policy tilts the table away from those with assets and towards those without assets but with a willingness to work for a living. You begin to see quite how outrageous this proposal is…

The proposition is indeed shocking. However it is a measure of the times in which we live that you really should read what Turner is saying. He is not a red, and nor are the economists (like Milton Friedman and Irving Fisher) whom he cites in support. Turner is pretty much an Establishment figure…

The lightest iteration of what Turner is saying is an FT opinion piece from last week. I have not done this before, but I am reproducing it in the hope the FT won’t pursue me for breach of copyright. (Having only been paid £250 for my recent opinion piece for them, perhaps they will decide they owe me a bonus; one notes that deflation is already haunting the Pink’Un.)

November 10, 2014

Printing money to fund deficit is the fastest way to raise rates

By Adair Turner

No technical reasons exist for rejecting this, only the fear of breaking a taboo, writes Adair Turner

What is the right course for monetary policy? The International Monetary Fund seems to answer with forked tongue. Its latest World Economic Outlook urges that monetary policy should stay loose to stimulate growth. Yet its Global Financial Stability Review warns that loose monetary policy risks creating financial instability, which could crimp growth. In fact the best policy is to print money and raise interest rates. That sounds contradictory, but it is not.

The global economy is suffering the hangover from many decades of excessive private sector credit growth. In 1950 private credit in advanced economies was 50 per cent of gross domestic product; by 2007 it was 170 per cent.

After the 2008 crisis, households and companies began trying to pay back what they owed. This depressed consumption and investment, generating large fiscal deficits as tax revenues fell and social expenditure rose. It then seemed essential to balance public sector accounts, which has depressed growth further and made deleveraging harder.

Debt owed by the public and private sectors has actually increased as a proportion of GDP, from 170 per cent five years ago to 200 per cent today. Weak demand has led to below-target inflation in all major economies.

Economists agree that this is how we got into the current mess, but they disagree about how to get out of it. Some, such as Paul Krugman and Lawrence Summers, argue for more relaxed fiscal policies. Cutting taxes or increasing public expenditure is the most certain way to stimulate demand. In Milton Friedman’s words it is an injection directly “into the income stream”. But this route out of recession would increase public debt even further. It seems blocked.

Instead, most countries have opted to combine fiscal tightening with ultra-loose monetary policy, setting short-term interest rates close to zero and using quantitative easing to reduce long-term rates and boost asset prices.

There are no technical reasons to reject such measures, only the fear of breaking a taboo.

But there are dangers. Sustained low interest rates create incentives for highly leveraged financial engineering. They make it easier for uncompetitive companies to survive, which could stymie productivity growth. And they work by restarting growth in private credit – which is what led to our current predicament. The Bank for International Settlements therefore argues that monetary policy should be tightened as well as fiscal, but that would depress demand yet further.

We should indeed seek a swift return to higher interest rates, to remove the dangerous subsidy to high leverage. But paradoxically, the best way to do that, particularly in Japan and the eurozone, would be to deploy a variant of Friedman’s idea of dropping money from a helicopter. Government deficits should temporarily increase, and they should be financed with new money created by the central bank and added permanently to the money supply.

Money-financed deficits would increase demand without creating debts that have to be serviced. This would lift either real output or inflation and allow interest rates to return to normal more quickly. True, banks might amplify the stimulus by creating additional private credit, but they can be restrained with higher reserve requirements.

There are no technical reasons to reject this option, only the fear that once we break the taboo, money-financed deficits will be used on too large a scale.

Despite that fear, de facto monetisation is inevitable in some countries, even if policy makers deny it.

Japan’s official policy involves using sales tax increases to make government debts sustainable, while massive monetary stimulus spurs inflation and growth. In fact there is no believable scenario in which Japan will generate fiscal surpluses sufficient to pay back its debts, nor one in which the Bank of Japan will sell all its holdings of government debt back to the market.

All the same, the pretence undermines the effectiveness of the policy. Japan should either delay the next sales tax increase, or announce a temporary fiscal stimulus financed with new money. It should make clear that the debt the government owes the central bank will never need to be repaid, dispelling fears of a massive future fiscal tightening.

Orthodox theory sees helicopter money as risky. But current quantitative easing policies are at least as risky, and have produced adverse side effects. In the UK the Bank of England has bought £375bn of government bonds to try to stimulate the economy through swollen asset prices and rock-bottom interest rates. It could instead have created new money to finance a smaller one-off increase in the fiscal deficit. If it had done so, a return to normal interest rate disciplines would now be nearer.

 

More. Turner for grown-ups:

Turner’s original CASS business school speech on this subject (2013)

And the slides that go with the CASS speech. (Lots of them, but many worth having if you live in the UK and are about to have people knocking on your door in the run-up to the May national elections asking you to vote for them. ‘Come in,’ you can say. ‘Have a seat and let’s look at the slides together!’)

A bit of Q&A with Turner and Michael Woodford from the Institute For New Economic Thinking blog.

Finally, on Thursday 20 November, the UK parliament will hold a backbench debate on the topic of ‘money creation and society’. It will be the first time that the issue has been addressed in a full debate in the House since the 19th century. You can watch here on Parliament TV and discover just how ill-equipped our politicians are to deal with the aftermath of the global financial crisis.

 

 


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