Now and then one is struck by the antediluvian quality of labour relations in the US. The confrontational rhetoric and negative-sum bargaining of some US unions, warmly endorsed by progressive intellectuals and the New York Times, is straight from the Arthur Scargill handbook. You remember Arthur Scargill.
Why a European, even a talented one, should not lead the IMF. The Economist. Well said. Also:
Let there be a real contest. FT editorial.
Background on the succession. Alan Beattie, FT.
Stan Fischer may run. Bob Davis, WSJ.
Who pays the taxes in the US? Chuck Marr and Brian Highsmith, Center on Budget and Policy Priorities. The income tax falls lightly on the less well-off, but the tax system as a whole does not. “When all federal, state, and local taxes are taken into account, the bottom fifth of households paid 16.3 percent of their incomes in taxes, on average, in 2010. The second-poorest fifth paid 20.7 percent.”
Is World War II still “the good war”? Adam Kirsch, NYT. “[A] necessary but terrible war is simplified into a ‘good war’, and we start to feel shy or guilty at any reminder of the moral compromises and outright betrayals that are inseparable from every combat.”
Martin Feldstein argues that Greece must (a) default and (b) take a leave of absence from the euro. Neither will be easy to arrange, but it is difficult to say what the second course even means.
The design of the debt restructuring that everybody thinks is coming will be important. Angelo Baglioni argues for a “leveraged buyback“. This would involve Greece buying back its debt using money borrowed from European Financial Stability Facility–with the crucial proviso that this loan would be senior to Greece’s existing bonds. This would keep Greek bonds cheap as it bought them back, thus transferring more wealth from creditors and letting Greece lower its debt burden more effectively. Baglioni says a buyback done this way would mitigate the knock-on effects of a conventional default (partial repayment or stretching out of maturities) through global financial markets. Looks right to me.
Jeffrey Frankel’s blog has a couple of good posts on learning from the Europe’s mistakes over Greece: where the ECB went wrong, and what to do about it next time.
Incarceration is the great American exception. The rest of the world contemplates the US prison system with disgust; here, it arouses surprisingly little controversy.
You would expect American progressives to be far more exercised about it than they are. They are properly concerned about prolonged detention of terrorist suspects and the treatment of leakers of official secrets such as Bradley Manning, but apparently not much worried about criminal-justice issues that are quantitatively far more significant: questionable court practices (including default recourse to the plea bargain, which has made trial by jury a comparative rarity); extended periods of remand in custody; astonishingly long sentences (including for non-violent offenders); the erosion of judicial discretion in sentencing; outrageous “three strikes” laws; and often deplorable prison conditions. These things affect literally millions of US citizens. Waterboarding rightly shocks the progressive conscience; rape in prison is permissible material for chat-show comic monologues.
Even criminals have rights. Yet for every liberal I’ve heard complain about conditions in US prisons, I’ve heard ten say it’s a disgrace that white-collar (ie, non-violent) offenders get off with short sentences at “Club Fed”.
Good for the Supreme Court, therefore, in voting 5-to-4 to require California, whose prisons are especially notorious, to reduce its prison population and curb overcrowding. The judgment included photos of inmates crammed together, and tiny cages in which some are confined. It is a shame that the order was necessary–the courts should not have to make prison policy this way–but what was the alternative? As an FT editorial put it:
It is indeed a desperate and unsatisfactory measure – yet warranted under the circumstances, which are extreme.
Democrats are reading a lot into their unexpected win in the New York special election. The election was about Medicare reform, they say: voters roundly rejected the House Republican plan. Republicans are dismissing the defeat, citing special factors such as the split in their vote caused by a phony Tea Party candidate. After allowing for special factors, argues Michael Barone, the GOP still did worse than it should have, and the Medicare issue was one reason why. The GOP started this fight, but is not winning it. See also Dan Balz:
Democrats should not read too much into Tuesday’s results. But it is the Republicans who have the most to learn from what happened there.
Republican leaders believe in their agenda and are not likely to back away from it just because they lost one House seat, particularly one that they could very well win back in 2012. But they have not yet won the argument over how best to deal with the country’s fiscal problems. They have accepted the responsibility to propose. Now they will need to learn how to persuade.
The next head of the IMF is expected to be Christine Lagarde. Europe’s leaders are converging on this appointment and if the US goes along the deal will be as good as done. Lagarde is a reasonably well-qualified candidate but this choice, guided by the desire to perpetuate the arrangement under which a European heads the Fund and an American the World Bank, is a mistake.
Moises Naim powerfully makes the case against an outrageous dispensation. He detects the stench of colonialism and I agree.
Even the leaders of the Group of 20, the assembly of nations that accounts for more than 80 percent of the world’s economy and two-thirds of its population, recognize that leadership selection at these institutions must change. When they met in early 2009 in London on the heels of the financial crisis, the G-20 leaders asserted that “the heads and senior leadership of the international financial institutions should be appointed through an open, transparent and merit-based selection process.”
That this is not already the standard is outrageous. No more outrageous, of course, than how European countries are offering countless excuses for why Strauss-Kahn’s replacement must carry a European passport.
Deference to the politically powerful is a hideous trait, not least when it leads to a code of silence (de facto or de jure) about improper conduct. I can see why Americans are pleased that Strauss-Kahn has been denied the privileges of rank that France would no doubt have accorded him. On the other hand, you have to wonder what the presumption of innocence is worth in a case like this in the United States. Press and television are tirelessly laying out evidence for the prosecution–untested facts, leaks of dubious provenance, and assorted rumour and innuendo–before a salacious and semi-attentive public. In Britain and Europe much of this would be contempt of court. And so it should be, if the presumption of innocence means anything.
Philip Stephens is right.
Junking the myths and emotional baggage wrapped up in the idea of a uniquely special bond between London and Washington is long overdue.
The US and Britain have a natural alliance based on a close alignment of interests and values. But that is all it is. Neither side should expect any more or any less. The British preoccupation with the “special relationship” is embarrassing–and it is worse than merely embarrassing, when decisions not in Britain’s interests flow from a desire to prop up the conceit.
The Queen in Ireland: A sovereign’s debt. David Gardner and John Murray Brown, FT. A better case for the monarchy than royal weddings or funerals. Obama of Moneygall. Mark Landler, NYT. Is there anywhere the president does not have roots?
Obama gets real on Israel. Daniel Levy, American Prospect. Obama is trying to help Netanyahu, but is Netanyahu interested? Obama at AIPAC. “There was nothing particularly original in my proposal… What I did on Thursday was to say publicly what has long been acknowledged privately.” The Syrian Problem. Steve Coll, New Yorker. “The time for hopeful bargaining with Assad has passed.”
I’m hoisting this valuable comment from Roger Algase in response to my column last week on immigration up to the main page.
The last paragraph of this article, about the need for executive action in favor of liberalizing the immigration system is especially apt. However, few people who do not deal with the immigration system on a day to day basis, which I do as an immigration lawyer, realize how much executive action on immigration there has been since Obama took office. The problem is that almost all of it has been in the direction of making the immigration system harsher and more punitive, with regard to both legal and illegal immigration.