The Great Debate UK

from Felix Salmon:

Britain’s fiscal failure

Never mind Sachs vs Krugman: by far the most interesting and important fiscal-policy debate right now is Cameron vs Wolf.

David Cameron, of course, is the prime minister of the UK, and last week he gave a rambling 4,000-word speech on the national economy which is almost impossible to read. For some reason the speech appears online in what you might call teleprompter format, with a single sentence sometimes spanning three separate paragraphs. It's a clear indication that Cameron is more interested in rhetoric than he is in substance.

Meanwhile, Martin Wolf, who for many years has been the most respected and important economic commentator in Europe, has in recent weeks become much more accessible. Check out his column on bankers' bonuses, for instance: it's a smart and rollicking read, arguing persuasively that the UK government is being idiotic in its opposition to European bonus caps.

Wolf's immediate response to Cameron was solid, but his second go-round is just devastating: we're now officially in a world where the wonkiest columnist in the driest newspaper in Britain is stating his case far more simply and clearly than the populist PR man turned prime minister:

“Tobin Tax” is a step backward for financial markets

–Tanuja Randery is the CEO of trading services firm MarketPrizm. The opinions expressed are her own.—

As the economic downturn continues to drag on, the cynics amongst us might be forgiven for thinking that the “Tobin Tax” is a move by politicians to curry public favour by taking punitive measures against the financial services sector.

from The Great Debate:

Chávez’s death leaves Venezuelans with hard choices

Venezuela has kicked off a presidential election campaign whose charismatic central figures are a governor and a ghost. The victor, however, may well be the flesh and blood heir of a revolutionary regime left to grapple with real and deepening crises.

The opposition has seized upon the death of President Hugo Chávez last week as an opportunity to break the 14-year grip on power of the self-styled socialist revolutionary and send their candidate, state Governor Henrique Capriles, to the Miraflores palace in elections set for April 14. But the outpouring of grief following El Comandante’s death from cancer showed the polarizing figure will continue to grip the national psyche.

from The Great Debate:

Without coordinated leadership, Europe will falter

There is an increasing probability that financial markets will respond negatively to the unfolding economic and political drama unfolding across Europe. So far, the European Central Bank has pumped out cash and calmed the nerves of investors, but it needs to do more. A cut in interest rates by the ECB is crucial to contribute to a revival of growth across the euro zone. On its own, however, that is not enough. Europe’s political authorities need to counter the increasingly widespread perception that they lack the will to confront the zone’s economic ailments and promote a clear path to growth – austerity policies alone will not work.

The situation has become far more serious now that the crisis has moved from the zone’s periphery to its major economies: Spain shows no signs of emerging from prolonged negative growth, Italy is now facing mounting difficulties and France is sliding into recession.

All pain, no gain for Germany

By Laurence Copeland. The opinions expressed are his own.

Whenever the question of the future of the euro zone comes up, you can always rely on someone (often a German) to say something like “Yes, of course the Germans don’t like having to foot the bill for the weaklings… but at the same time, they do get enormous benefits from having a fixed exchange rate. I mean, just look at their trade surplus. All those Mercs and BMW’s you see in Milan and Athens and…”

This argument is utter nonsense, and the economists especially ought to know better.

from The Great Debate:

With Chavez gone, what of ‘Chavismo’?

“The End of the Chávez Era” That was the headline on Colombia’s major newspaper, El Tiempo, the day after Hugo Chávez’s death.

True, Chávez’s controversial and colorful 14-year rule has ended, and Venezuela has lost a president who evoked uncommonly intense passions among followers and detractors.   Venezuelans will not easily forget a leader who, for better or worse, was the consummate showman and left an indelible mark on a highly polarized society.

If only more CEOs were like Andrew Mason

Photo

By Kathleen Brooks. The opinions expressed are her own.

Groupon’s ex-CEO won’t be remembered for his stewardship of the internet deal company, but he is likely to go down in history as writing one of the best and most honest goodbye memos of all time when he was sacked at the end of last week.

Two things in the memo to Groupon employees announcing his departure stand out: humour and honesty. This has to be the best opening line in the history of the departure letter: “After four and a half intense and wonderful years as CEO of Groupon, I’ve decided that I’d like to spend more time with my family. Just kidding – I was fired today.” How many times have we heard CEOs, politicians and other leaders use the “family” card to disguise the fact they have been unceremoniously dumped from their role of authority?

from The Great Debate:

A blueprint to make banks behave

Banking integrity has become an oxymoron. Top bankers need to change this and take responsibility for tackling ethical issues. For this to happen, every part of the organization – from senior management to human resources managers to those on the trading floor and beyond – should be assessed according to the contribution it makes to promoting ethical values, not just the bottom line.

The investigations into the LIBOR rate-rigging scandal showed how commonplace bribery among dealers had become. For example, between September 2008 and August 2009 a single trader at the Royal Bank of Scotland had made corrupt payments to interbank brokers on 30 occasions, by means of risk-free transactions known as "wash trades."

from The Great Debate:

Can diplomacy prevail with Iran?

New talks with Iran ended Wednesday with a surprising forward spin. More meetings are planned in the now decade-long American-led effort to ensure the Islamic Republic does not get nuclear weapons.

Iran must now accept or reject a proposal that offers some sanctions relief in return for Tehran’s reducing its stockpile of uranium enriched close to weapon-grade. This hopeful note – Tehran’s reaction was positive – comes as a showdown looms, because Iran continues to inch ever closer to being able to make a nuclear weapon.

from The Great Debate:

How close is Iran to nuclear weapons?

Israeli Prime Minister Benjamin Netanyahu claimed last week that new second-generation centrifuges, which Iran plans to start up at its Natanz uranium enrichment facility, could cut by a third the time needed to create a nuclear bomb – underlining his deadline of this summer to take military action against Iran.

Netanyahu’s prediction, however, appears to be based on some unsubstantiated assumptions regarding Iranian intentions and capabilities. Yet it can provide ammunition to the hawks in Washington and Jerusalem, who could rush us into another needless and counterproductive war in the Middle East. Netanyahu’s assertions do not stand up to technical scrutiny.

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