Tunisia: Freedom and the pursuit of unhappiness

 
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By Khaled Diab

With greater freedom has come greater unhappiness in Tunisia. Behind this apparent paradox is economic hardship and nostalgia for a past that never was.

Photo: ©Khaled Diab

Tuesday 6 November 2018

In these dark times for the Middle East and with democracy on the retreat even in its oldest and most established strongholds, Tunisia is the exception that proves hope is not just for optimistic fools.

With the revolutionary wave that began in Tunisia at the end of 2010 and swept the region with its infectious demands for economic empowerment, social dignity and political freedom, this small North African country is the exception that proves that despotic rule need not be the rule in the Arab world.

Across the region, many pro-democracy, progressive and liberal activists, opposition figures, human rights defenders and ordinary citizens who believe in freedom, Tunisia inspires them to believe that they are not being delusional in believing their own countries can be reformed.

Over the past almost two years of living in Tunisia, I have found the country’s newfound freedom remarkable, as have other Egyptians based here or visiting. For a start, despite fears that freedom would lead to extremist-led chaos, Tunisia has managed, unlike so many revolutions throughout history, to maintain stability and pass or draft landmark legislation to ensure fundamental rights and equality.

“Tunisia has a vibrant civil society, exceptional record on women’s rights in the Arab world, as well as, overall, a politics, while far from perfect, that is continuously being negotiated forward,” contends Amro Ali, an Egyptian sociology professor whom I met during his recent visit to Tunisia. “What started with them was no ordinary feat; they raised the standards and they’ll be held up to it. So they will be treated like a political beacon, whether they like it or not.”

The street continues to be a major pillar of Tunisian democracy and political direct action continues apace, albeit with less intensity than in the heady early days of the revolution. Barely a week goes by without a demonstration or a strike somewhere in the country, to protest economic hardship, unemployment, government action or government inaction.

Tunisians, both friends and strangers, have plenty of opinions on politics and other issues and they have no reservations about sharing them, even during brief encounters at cafes, parties or on the street, especially when they find out you are an Egyptian.

Although I have no personal pre-revolutionary reference point, Tunisians tell me that this is a far cry from how things used to be in the days of the dictatorship of Zine El Abidine Ben Ali. Tunisian broadcasters have built up an impressive track record in a short span of time, and I am regularly impressed by the depth and breadth of public debate on the airwaves.

Taxi drivers have been a colourful, engaging, eccentric and diverse source of political commentary, and I have compiled enough amusing anecdotes to write a short book. But this was not always the case. One taxi driver admitted to me that, in the past, he would have been afraid to even think Ben Ali’s name while on the job, whereas now he had turned his taxi into a political salon on wheels.

Tunisian broadcasters have built up an impressive track record in a short span of time. Whereas there has been a trend in the media of maturer democracies towards dumbing down their content, Tunisia has been wisening up its coverage. For instance, many FM music radio stations in Europe and America either carry no political content or cut it up into tiny, bite-sized morsels, out of fear their audiences will switch off. Not so in Tunisia, where even the most commercial music stations carry hours of news, in-depth coverage, discussion and debate.

Despite the immense political, social and cultural progress, the sense of widespread disillusionment and despondency is palpable, and this is confirmed by surveys and polls. The number of Tunisians I encounter who are unhappy with the situation, are sceptical about the path the country is taking and are pessimistic about the future is truly astonishing.

“I think that the Tunisians had built up high expectations about what the revolution could bring, but the political class quickly disappointed,” observes Sarah Ben Hamadi, a blogger, former journalist and deputy secretary-general of the Tunis-based Democratic Lab think tank. “The economic crisis felt by the middle class, which is making the daily lives of Tunisians increasingly more difficult, makes it harder to appreciate progress in terms of freedom.”

Although Tunisia’s economy has slowed down, it continues to grow, but not at a rate that has enabled it to make any serious dent in joblessness numbers nor to improve people’s sense of economic welfare. In fact, with a weakening currency, rising inflation and the phasing in of austerity measures, including the removal of subsidies and raising of fuel and other prices, Tunisians feel worse off today than before the revolution.

“[Tunisians] don’t really count social and political progress as wealth,” asserts Karim Benabdallah, a blogger, activist and photographer. “They usually see things in their own narrow perspective.”

Tunisia’s economic woes have hit young people, who spearheaded the revolution but still make up the bulk of the unemployed, particularly hard, leading them to “feel neglected, unheard and invisible,” according to Omezzine Khelifa, the founder of Mobdiun, which researches the status of youth from neglected neighbourhoods in Tunis and seeks to find ways to empower them politically.

“Those who live in marginalised areas feel the state is not doing anything for them and have witnessed how any form of protest can turn against them in a violent way,” she adds. “They say police is not here to protect us, rather to harm us.”

Although Ben Ali’s repressive state is largely gone and protest is a protected constitutional right, police brutality and violence remain a problem, with class and age affecting how the police treat citizens, as reflected in how the police overreact to protests in poorer neighbourhoods.

In addition, youth in marginalised areas are more likely than their better-off counterparts to experience other forms of violence, including from their peers on the street and domestic violence at home. The alienation and frustration feeding this violence can also be turned inwards. According to Mobdiun, between 6% and 10% of teenagers in one poorer neighbourhood of Tunis have attempted to commit suicide. More alarmingly, similar suicide rates exist among youth in better-off areas.

This points to an existential crisis among young Tunisians, with dreams of emigration their escapism from their dispiriting reality, with some numbing the pain and the unbearable heaviness of being through self-medication. “I said to myself: I’ll find a job, I’ll manage, I’ll find… and nothing, I did not find anything,” confessed one young man who spoke to Mobdiun. “A friend comes to me and suggests we ‘fly’ on a train (i.e. ride on the outside) because we have no money, we are obliged, how else will we buy cannabis to smoke in the evening and to escape a little?”

Some find escapism in the past. While many young Tunisians appreciate the freedom under which they are growing up, others see it as overrated, especially since a whole generation is now emerging that never experienced the bad old days first hand. “The social and political progress seen by outsiders, it’s honestly a big joke,” contends Malek, a law student. “It only proves that they have no idea about how it used to be before.”

This sense of a paradise lost actually originates with and is more common amongst older people, who have established a veritable nostalgia industry, which is slowly trickling down the age pyramid. To hear Tunisian nostalgists speak, one is left with the impression that everything was better prior to the revolution: the economy was better, people were better off, people had a greater sense of civic duty, etc.

Some of those who subscribe to this sort of narrative do so out of frustration at their present hardships or fear of what lies ahead. Others do so as an expression of their authoritarian tendencies. They believe, or have been conditioned to believe, that Arabs do not understand or are not ready for democracy, and that they need a “strong” leader to keep them in check. The number of times I have heard this view, often combined with admiration for the likes of Egypt’s Abdel-Fattah al-Sisi or, worse, North Korea’s Kim Jong-un, is shocking.

“The fact that no leader has emerged also means that there is always a certain nostalgia for a time when the president enjoyed great authority,” explains Sarah Ben Hamadi.

However, what nostalgists do not seem to comprehend is that if the calibre of leadership that has emerged since the revolution has been found wanting compared with the Ben Ali era, which I am not sure is the case, this is, in reality, the legacy of decades of dictatorial monopoly over power and the accompanying elimination or sidelining of a viable opposition. In addition, Tunisia is no longer a one-man show and is founded on consensus politics and pluralism, which appears messier but is fairer and holds leaders to greater account and scrutiny.

A similar confusing of cause and effect, of symptom and disease, afflicts the question of economic welfare and prosperity. If life was so great under Ben Ali, the question begs itself: why was there so much desperation, symbolically represented by the self-immolation of Mohamed Bouazizi and Hosni Kalaya, and why did Tunisians rise up to demand not just freedom but also bread?

Linking the current economic crisis to the revolution, as many Tunisians do, is wishful thinking, in my analysis. Decades of economic mismanagement and crony capitalism cannot be reversed in a few short years.

If anything, the reason why Tunisia’s economy is performing relatively poorly, failing to create enough jobs and to distribute wealth more evenly, is not because the revolution demolished what came before but because the revolution left the country’s previous economic architecture too intact. In fact, I am personally convinced that if Ben Ali were still in power, the Tunisian economy would likely be in crisis.

In addition to Tunisia’s own internal faults, there is the regional and global dimension contributing to its economic woes. Not only is the fallout of the global economic crisis of 2008-09 still hurting Tunisia, the upheavals and conflicts across the region, especially in neighbouring Libya, have had a negative impact on the Tunisian economy.

The austerity-driven approach of international financial institutions are making a bad situation worse, as is the unfair structure of the global currency regimen, which excessively rewards rich countries and penalises poorer ones. In fact, with an economy barely larger than that of a multinational corporation, Tunisia is being crushed by the old titans of the West, who are desperately clinging on to their old privileges, and the new titans, foremost among them China, who are carving out a space for themselves, not just at Europe and America’s expense, but more brutally at the expense of developing countries with higher labour costs and smaller economies.

Constructing an a-historical narrative about the splendour of the Tunisia of Dictatorship Past will not restore a lustre which never existed. Instead, if believed by enough Tunisians, it risks leading to the Tunisia of Dictatorship Future, and the deconstruction or destruction of the most significant gains the revolution has delivered: freedom, dignity and collective decision-making.

The creativity, intelligence, wisdom and guts that overthrew a dictator and built a vibrant democracy should and can be harnessed to develop an economy that serves all Tunisians.

—-

This article was first published by The New Arab on 18 October 2018.

 

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Egypt’s dollar woes

 
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By Khaled Diab

Hopes are devaluation will resolve Egypt’s dollar crisis, but the situation could spin out of control without a global currency for international trade.

100le

Monday 11 April 2016

As Egypt’s economy continues to nosedive, the country has been gripped by a chronic dollar crisis in recent months, exacerbated by falling revenues from tourism and the Suez Canal.

The dollar shortage has fuelled inflation and severely hurt importers and domestic manufacturers who depend on imported raw materials or components. For instance, many imported medicines have become totally unaffordable and there is a shortage in locally produced generic alternatives due to the inability to import active ingredients.

The hard currency shortage has even affected the black market, with a number of reports in the Arabic media over hours-long searches for dollars at inflated prices.

To tackle the situation and to cool the overheated black market, the Egyptian Central Bank decided to devalue the Egyptian pound by 13 percent and to sell $198 million to commercial lenders at 8.85LE, from its previous level of 7.73LE.

The Cairo stock exchange, along with financial analysts, was jubilant at the news, recording its largest single-day rise, of 7%, since July 2013, and ending the week a massive 14% up.

However, the effect on Egypt’s long-suffering poor and vulnerable will be far less benign – their underpaid labour has also been devalued.

“Egypt’s poor are enduring the brunt of Egypt’s economic crisis,” observes Timothy Kaldas, a non-resident fellow at the Tahrir Institute for Middle East Policy, in a reference to the high inflation, removal of subsidies, and increased unemployment which have corroded living standards. “The devaluation will undoubtedly increase the cost of certain essential goods, particularly food.”

Continued and worsening hardship for the masses is also bound to hurt the regime. Support for President Abdel-Fattah al-Sisi was predicated on his much-hyped capacity to bring Egypt to a safe port of stability and prosperity.

So far, the Sisi regime has demanded of ordinary Egyptians to tighten their belts, while cushioning the wealthy, has given activists and critics a royal belting, and has been unable to keep a rein on spiralling terrorism and insurgency. In addition, despite escalating repression, industrial action continues to sweep across the country (Arabic).

And this disaffection and instability is only bound to grow if the regime delivers only immense pain and no gain.

The Central Bank’s devaluation and loosening of the official exchange rate may not be enough to salvage the situation if Egyptians continue to face dollar shortages and if those receiving remittances from abroad find better prices on the black market, argues Kaldas.

Central Bank Governor Tarek Amer has vowed to do whatever it takes to keep the currency market in check.

However, the early signs were not promising. Despite the devaluation and dollar injections, the Egyptian pound weakened on the black market, reaching 9.55LE to the dollar shortly after the devaluation, while the devaluation is further fuelling a property bubble. In early April, it stood at 10.30LE, according to Reuters, though the official rate has remained stable at 8.78LE.

This has led financial analysts to expect further cuts in the official rate, with the attendant pain it will cause ordinary Egyptians. JP Morgan forecasts that the Egyptian pound will be devalued by a total of 35%this year, with a projected inflation of 14%.

And as has been demonstrated elsewhere in the world umpteen times in the past, from Argentina to Germany, the situation could easily spiral out of control, if these measures elicit panic rather than confidence, or if speculators run the pound into the ground.

Beyond Egypt’s specific economic woes and poor governance, this points at a deeper, wider malaise: how the global trading system is stacked and loaded against smaller economies.

The main reason Egypt and other countries suffer from “dollar crises” is because the US dollar is the world’s dominant reserve currency and the main medium of international trade, though the euro has closed the gap in recent years.

Obliging smaller and poorer economies to trade in the dollar and other reserve currencies makes them vulnerable to the whims of the currency markets and forex speculators.

In addition, the dollar and euro distort trade in favour of the United States and Europe, enabling them to import and borrow far more cheaply than their fundamentals should allow.

But there are downsides for top-dog economies, such as making their exports less competitive and the inevitable trade deficits caused by the “Triffin Dilemma”. The unnaturally low cost of credit has played a central role in the US’s dangerously high public debt – on which it has come perilously close to defaulting – and contributed to the US subprime crisis and the European sovereign debt crisis.

The solution to this, in my humble view, is the introduction of a single global currency for the purposes of international trade. This would help remove the volatility of currency markets, end speculation, eliminate the currency black markets, and even the global economic playing field.

This is not a new idea. John Maynard Keynes, the legendary British economist, proposed just such a currency as the lynchpin of the post-war economic order, but was torpedoed by American opposition. Following the volatility and crises which have afflicted the global economy in recent years, China, Russia and other emerging powers have also called for just such currency reform.

A world trading currency would not only help stabilise and boost the global economy, it would also reduce the social fallout caused by dollar shortages and the immense inflationary pressures they create.

____

Follow Khaled Diab on Twitter.

This is the updated version of an article which first appeared on Al Jazeera on 28 March 2016.

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The Brussels press corps: Shaken, not sunken

 
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By Christian Nielsen

Despite the crisis in traditional media, the Brussels press corps continues to survive and thrive, but not without difficulties.

Yanis Varoufakis, Greece's radical new finance minister, addresses reporters in Brussels. The drama surrounding Greek austerity and the EU financial crisis have helped keep the Brussels press corps on the global map. Image: europa.eu

Yanis Varoufakis, Greece’s radical new finance minister, addresses reporters in Brussels. The drama surrounding Greek austerity and the EU financial crisis have helped keep the Brussels press corps on the global map.
Image: europa.eu

Thursday 26 February 2015

Europe’s financial crisis and the Greek tragedy may not be good news for those affected by them, but for the Brussels press corps, these events have helped keep their stories on or near the front page for several years, according to Gareth Harding, managing director of Clear Europe, a media consultancy company, and co-curator of a new book, Mapping Foreign Correspondence in Europe.

The book charts the major changes and challenges foreign correspondents face across Europe in the context of new media trends, the shifting political landscape in the European Union and the broader impact of the economic crisis on the industry.

“Print is still the king,” according to the book’s editor Georgios Terzis of Vesalius College (VUB), but online and cross-platform reporting are growing outlets for the foreign correspondents surveyed. The economic pinch can be seen in other trends observed in the book. Greater emphasis on generalists, travel budget cuts, and limited resources also affect the type and depth of coverage.

“Journalists say they are more prone to follow the official line and use think tanks or NGOs to get the other side of the story,” noted Terzis at the book launch. They lack resources, time and sometimes access to primary sources to check the story out. The journalists feel “kidnapped” by official sources, he added.

The mapping took two-and-a-half years to realise and involved a survey of more than a thousand foreign correspondents, hundreds of interviews and contributions from authors Europe-wide.

Perhaps surprisingly, the UK has the biggest press corps in Europe with some 1,700 registered foreign correspondents, followed by France (945), Belgium (931), Germany (729) and Spain (258). The industry is still predominantly a “boys’ club”, according to one journalist, and there has been a shift towards more single bureau offices with one correspondent wearing multiple hats, supplying content for print, online and social media channels, which is leading to increased pressure and stress.

In Brussels, despite what was purported in The Economist in 2010 (‘The incredible shrinking EU press corps’), the number of foreign correspondents accredited by the European Commission has remained quite stable in the decade following a ‘big bang’ expansion when 10 new member states joined in 2004.

“The single biggest problem is clearly economic,” noted the columnist Charlemagne. “The industry that has fed and clothed me for 12 years –being a full-time foreign correspondent – is in desperate straits everywhere. The internet has broken the link between news and advertising, establishing the idea that news as a commodity should be available for free.”

But while the EU press corps is not in “free fall”, as The Economist put it, there is some substance in the claims that new forms of online reporting, but also Belgian tax complications and the disconnect between traditional advertising and news have all hit the Brussels news business particularly hard. As too the suggestion that many, mostly older, member states have grown weary or just plain bored of the EU story unless – it should be added – it involves some sort of pain or grief that audiences in the more euro-sceptic  countries can ‘relate to’.

But the withdrawal of old Europe from the Brussels reporting bubble has not reduced the overall interest in Europe, nor its status as the new king of news and reporting, spearheaded by such outlets as the Financial Times and Der Spiegel. Terzis and Harding suggested correspondents from the former eastern countries and other regions, including China, have made up the numbers in Brussels, and where full-time posts have become rarer, the army of freelancers, bloggers and other ‘new’ journalists fill the gap.

Harding commented on some of these trends, including the growing pressure to publish or Tweet first and check later, the blurring of the line between reporting and opinion, and the need for more innovation and mashups in the sector.

Buzzfeed in the EU would shake things up, he concluded.

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The clash within civilisations

 
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This year marks the 20th anniversary of the clash of civilizations theory, but Samuel P Huntington was wrong.

Thursday 28 March 2013

A decade has passed since the blood-drenched invasion of Iraq began, unleashing a wave of destruction not seen in that part of the world since at least the Mongol sacking of Baghdad in the mid-13th century.

Unsurprisingly, the 10th anniversary has prompted immense media attention, in the United States and Europe, as well as in Iraq itself and the broader Middle East. In light of the carnage that has ensued following that fateful decision to invade, a lot of the public debate has focused on whether the war was justified and worthwhile.

The cheerleaders of the war argue that the invasion was just, the subsequent carnage was an unfortunate but collateral consequence of a benign act of goodwill, and that errors were made in the execution of the campaign but the principle was essentially sound.

Critics, like myself, see the wholesale destruction of Iraq and the chaos besetting it – which was chillingly illustrated by the deadly car bombings which rocked Baghdad on the 10th anniversary – as clear proof that the US-led intervention was not only unjustified but flawed.

In order to understand why, we need to rewind another 10 years, back to another important anniversary which has largely fallen under the media’s radar. Through some fluke of history, the theory which largely justified the Iraq war and provided it with its ideological underpinning was formulated exactly a decade earlier.

In an incredibly influential essay published 20 years ago in Foreign Affairs, the late Samuel P Huntington first outlined his clash of civilisations theory, which he later elaborated on and fleshed out in a book published in 1996.

Huntington argued that “the fundamental source of conflict” in the post-Cold War era would be not ideological or economic but “cultural”. “The clash of civilisations will dominate global politics. The fault lines between civilisations will be the battle lines of the future,” the Harvard professor argued.

Huntington divided the world into some half a dozen major civilisational groups which, he posited, would clash at two levels: local “fault line conflicts” where civilisations overlap and “core state conflicts” between the major states of different civilisations.

On the 20th anniversary of this controversial theory and given how influential it has been and remains, it is useful to analyse whether or not Huntington was right. Has a clash of civilisations emerged, as Huntington predicted, over the past two decades?

Supporters of Huntington’s hypothesis answer with an unequivocal “yes”. They point to the inhumane atrocities committed in the United States by Islamic extremists on 11 September 2001, the subsequent clash with al-Qaeda, the wars in Afghanistan and Iraq, as well as the rise of Islamist parties during the “Arab Spring” as confirmation that a clash is underway.

Critics, like the scholar Noam Chomsky, have maintained that the clash of civilisations is simply the symptom of an empire, i.e. Pax Americana, in search of another justification for its imperial aspirations after the Cold War paradigm fell apart with the collapse of the Soviet bloc.

The late Edward Said, the renowned author of Orientalism, saw in Huntington’s theory an extension of the pseudo-scientific Orientalist scholarship which had been used for at least a couple of centuries to justify European and Western hegemony. In an essay entitled The Clash of Ignorances¸ published shortly after 9/11, Said argued that Huntington ignored “the internal dynamics and plurality of every civilisation” and “the fact that the major contest in most modern cultures concerns the definition or interpretation of each culture”.

Personally, I find that, though the idea, in one form or another, of a clash of civilisations is as old as the hills – examples include the historical notions of jihads and crusades, not to mention the idea of “civilisation” versus “barbarity” espoused by most dominant powers throughout the centuries – this does not make it any more valid or true.

Far more often than not, what has been dressed up as a clash of values is really just a clash of interests parading as something less selfish than it actually is. Although culture and ideology can, on rare occasions, lead to conflict, for the most part, societies enter into conflicts due to clashes of interests.

And in such a context, proximity is traditionally a far greater cause of friction than culture. That is why conflicts within self-identified cultural or civilisational groups are often greater than those between them. Over the centuries, Christians and Muslims have gone to war and killed more of their coreligionists than each other, as the carnage of two world wars in Europe shows all too clearly.

That would explain, for instance, why the United States decided to invade Saddam Hussein’s secular Iraq, even though it was a sworn enemy of al-Qaeda and jihadist Islam, yet is bosom buddies with Saudi Arabia, the hotbed of reactionary Wahhabism, which it exports around the region and the world, and the home of most of the hijackers who took part in the 11 September attacks.

And alliances which cut across supposed civilisational lines have an ancient pedigree. Examples include the Arabs allying themselves with the British and the French against the Turks, or the Ottomans fighting alongside the Germans in World War I against the British, French and Russians. In fact, throughout its centuries as a major power, the Ottoman Empire’s alliances shifted between various Christian European states, including France, Poland, as well as the Protestant Reformation against the Catholic House of Habsburg.

Moreover, Huntington’s hypothesis is further undermined by what I like to call the “mash of civilisations”. Each so-called civilisation is actually a volatile, constantly changing hybrid of ideas and cultural influences.

In fact, if we must group civilisations together, then I would place the West and Islam in the same group because they both share common roots in the Abrahamic tradition, not to mention the Greek and Hellenistic, Mesopotamian and Egyptian influences, as well as the modern importance of the Enlightenment, not just for Western reform movements but also for secularising and modernising movements in the Middle East. I would go so far as to say that Europe and the Middle East, especially the Mediterranean countries, have more in common with each other than they do with their co-religionists in Africa and further east in Asia.

So, if there has not been a clash of civilisations, what has emerged since the end of the Cold War?

At one level, there are the brewing clashes of interests between the great powers, as America tries to hold on to its waning global reach, Russia tries to claw back the influence it lost following the implosion of the Soviet Union and China, after years of quiet growth in the background, begins to flex its muscles on the foreign stage, both to advance its emerging “strategic interests” and for prestige.

On another level, cultures have clashed, but not between civilisations, as Huntington believed they would, but within them. This clash within civilisations is currently playing itself out most visibly in the Middle East.

In addition to the sectarian monster unleashed by the anarchy in Iraq, the revolutionary wave that has swept through the region has brought to the fore, and into sharp relief, the major fault lines and clashes within each society and, to a lesser extent, between them. There are the conflicts between the secular and religious, between majorities and minorities, between women and men, between the young and old, between modernists and traditionalists, between the haves and have-nots, and so on.

Although less pronounced, at least for the time being, these same internal tensions are being witnessed in the West, as reflected in the rising influence of Christian fundamentalism in the United States and the extreme right in Europe, as well as the large-scale social protests, from years of street battles in Greece to the Occupy Wall Street movement of the “99%”.

In Europe, particularly, class conflict is intensifying on the back of the economic crisis triggered by neo-liberal excess, as the poor and middle-classes are forced, through bailouts and austerity, to finance what has effectively become a welfare state for the rich. This is putting in jeopardy not only the much-vaunted European social model but also the EU enterprise itself.

If the European Union is not reinvented along more equitable lines and emerges out of this crisis, instead, much weakened, then it will likely leave a petty-nationalistic sized hole in the European arena which could eventually cause the conflicts currently taking place within individual countries to spill across borders.

In the second decade of the 21st century, a major challenge facing us all is not the clash of civilisations but the clash within civilisations. This internal cultural struggle is largely caused by the growing socio-economic inequalities that have emerged in just about every country in the world.

If these inequities are not addressed effectively, at both the local and global levels, then intolerance will grow and conflicts will continue to consume individual societies, with the danger that they will spill over into other countries, potentially spiraling out of control.

___

Follow Khaled Diab on Twitter.

This article first appeared in The Huffington Post on 21 March 2013.

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From right to far-right in Spain

 
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By Andrew Eatwell

Why is there no prominent far-right party in Spain? Well, there is and there isn’t.

1 August 2011

It is a question that gets asked every time the extremist right goes on the rise elsewhere in Europe. Typically, the response from Spaniards, especially those on the left, comes as a half-joke, half-truth: “There is,” they say. “It’s the People’s Party,” comes the punch-line.

The truth is that the People’s Party, which brands itself as a conservative centre-right force similar to Britain’s Tories or Germany’s Christian Democrats, does have its roots – at least historically – in the ashes of General Franco’s fascist regime. Its 88-year-old founder and honorary chairman, Manuel Fraga, was a former minister in Franco’s government and several of the party’s prominent members are relatives of regime figures. But that’s all old history. And, all jokes apart, only the most extreme leftists would seriously describe the modern PP as a far-right party.

Spain’s history, and memories of the repression that existed until Franco’s death in 1975, make the far-right less appealing to Spaniards than voters in other countries. Therefore those Spaniards who worry about the right’s traditional pet peeves, such as immigration (a growing majority) or Christian and family values, and who might vote for far-right parties were they in another European country, tend to vote for the mainstream PP in Spain.

That is likely to be the case come November, with the PP looking likely to win a landslide victory in early elections as voters turn against the Socialist government, blaming it for the economic crisis that has given Spain the highest unemployment rate in Europe at more than 20%.

Immigration, that bugbear of right-wingers everywhere, will certainly be one issue in the election. One recently published report noted that between 2004 and 2008, the number of people who thought Spain’s immigration policies were too lax rose from 24% to 42% – and that was before the economy completely stalled. Half the population thinks that the presence of immigrants lowers the quality of social services, specifically health and education, and it is widely believed that they take jobs that would otherwise go to Spaniards.

The PP has certainly tried to stir up the immigration issue to its benefit, but there are signs that some people feel the PP is not – and will not – take a hard enough stance on the issue. As a result of unemployment and the economic crisis, for the first time, more radical parties are gaining a foothold. 

In local elections in May in the wealthy northeastern region of Catalonia, a far-right xenophobic party, Plataforma per Catalunya, sprung out of almost nowhere to win 65,000 votes, returning 67 councillors, 50 more than in the previous elections.

Its campaign featured a video showing three attractive young women in miniskirts skipping with a rope in the city of Igualada to the accompaniment of a traditional Catalan folk song. Suddenly, the image changes to “Igualada 2015” and shows three women dressed in burkas skipping to the rhythm of an Arab song. 

The party, led by Josep Anglada, a former disciple of fascist figure Blas Piñar, espouses the kind of anti-immigrant rhetoric more commonly associated with the likes of France’s National Front or the British Nationalist Party. It is now a major player in Catalan politics.

If anti-immigrant sentiment continues to rise, it is possible that other extremist parties in other regions – and even nationally – may see gains like those of Plataforma per Catalunya, and the old joke about Spain not having a far right may no longer hold true.

This article is part of a special Chronikler series on far-right extremism. It is published here with the author’s consent. ©Andrew Eatwell.

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The rise of far-right politics on both sides of the Atlantic

 
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On KALW’s weekly media round table, Khaled Diab took part in a radio debate on the rise of far-right politics on both sides of the Atlantic following the ‘Tea Party’ victory in the United States.

This week, KALW’s Media Round Table discussed coverage of the US mid-term elections. What role did the media play in shaping the conversation about the elections? The programme also talked about rise of right-wing political parties in Europe.  Your Call iq hosted by Rose Aguilar.

Guests:
Arthur Delaney, reporter with The Huffington Post

Khaled Diab, a journalist and writer who works in the Belgian and EU capital Brussels. He writes a regular column for The Guardian and also freelances with other publications.

Davey D, a nationally recognised journalist, syndicated talk show host and radio programmer with Hard Knock Radio on KPFA

Listen to the Media Round Table

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Making globalisation pay

 
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By Khaled Diab

Big corporations are using the banking crisis as an excuse for exploiting cheap labour. Is it time for a global minimum wage?

4 February 2010

For beer lovers, Belgium is the nearest place to heaven on earth. The country’s 125 or so breweries produce an estimated 800 standard beers, each of which is served in its own distinctive glass. This mushrooms to nearly 9,000 when special editions are included.

Given this ocean of booze, you would expect that the temporary loss of a handful of beers would cause hardly a ripple. In a country where beer receives the kind of appreciation reserved for wine in other cultures, the recent threat to supplies of some of Belgium’s favourite tipples captured headlines and caused distress.

The “Beer Crisis”, as it became known, was caused by striking workers blockading three breweries owned by the world’s largest beer giant, AB InBev, which, among other things, produces the popular but bog-standard Stella Artois and the more upmarket Abbey beer Leffe.

The immediate cause of the blockade was AB InBev’s plans to trim its Belgian workforce by 300 (with another 500 to be scrapped in the UK, Germany, the Netherlands and Luxembourg), ostensibly because of falling beer consumption in western Europe.

Despite the inconvenience to the beer-drinking public, most Belgians are sympathetic with the strikers. “We’re with the strikers,” declared one regular at a café in Halle. “If the beer flows dry, that is only a relative problem.”

This is because, InBev (previously known as InterBrew), though it is admired for raising the global profile of Belgian beer, has become infamous for its cavalier attitude towards its workforces, which have endured several ‘restructurings’ in recent years to cut costs, while the management pays itself lavish bonuses, engages in expensive prestige acquisitions (such as the US makers of Budweiser), and exports jobs to countries where labour is cheaper.

Faced with this public relations disaster and the loss of market share to smaller breweries, InBev’s management has backed down for the time being and the blockade is being lifted.

Workers at the nearby Opel plant in Antwerp have not been so fortunate. Despite an offer of a €500 million bailout from the Flemish government, and voluntary pay cuts agreed by the unions, troubled US car giant GM has decided to close the 85-year-old Antwerp plant, axing 2,600 jobs in the process. The decision is all the more puzzling because the plant still turns a healthy profit.

It seems that InBev and GM are taking advantage of the current financial crisis. Both are shifting jobs to countries where labour is cheap, while GM seems to be subsidy shopping and has successfully pitted the German government against the Belgian government.

And they are not alone. With their massive revenue streams and the mobility to shift their assets rapidly, countless multinationals have used globalisation to hold governments to ransom and stack the global trading system unfairly in their favour by ‘outsourcing’ their operations to so-called low-cost countries while selling their output in higher-cost wealthy countries.

So what can be done to curb this kind of corporate excess and greed and put a brake on this undignified race to the bottom?

One idea could be to develop an international minimum wage and integrate the concept into the architecture of the World Trade Organisation, especially since the Doha round of trade talks is ostensibly aimed at triggering sustainable development. What could be more sustainable for the global economy than affording all workers a decent income?

But, even assuming that WTO member states can muster up the political will to set such a global standard – after all, both rich and poor countries would have their own reasons for opposing it – attempts to set an international minimum wage would face umpteen practical hurdles.

For example, if you set it as an absolute amount, what would you take as your reference? Universalising, say, western European levels would be unaffordable for developing economies and unfair to European workers who have to contend with some of highest costs of living in the world.

Instead, we could determine a minimum standard of living to which all workers should be entitled and use that to calculate a fair wage for each country using purchasing power parity. However, given the magnitude of global income disparities, this would disadvantage local companies in poorer countries who, compared with multinationals, do not possess the resources to pay such wages – nor can the domestic markets they cater for absorb the extra cost.

So, until we have true global economic convergence, it would be far better to start the process of fairer trade at home, and more strictly regulate our multinationals. Today’s giant corporations are often likened to small countries. However, there are important differences: they are not tied down by geography and, given the paucity of international regulations, they can get away with practices that would be considered unscrupulous or even illegal in their home territories.

Just as the vast majority of developed economies from which most multinationals hail have minimum wage systems in place, it’s time global corporations were made to apply similar practices in their overseas operations in poorer countries.

In addition to an absolute rock bottom wage which they cannot go below, multinationals should be obliged to implement an indexed salary system in which workers in their overseas operations cannot earn less than, say, half of what a worker doing a similar job in their home territory earns.

Complaints are bound to be heard about how this interferes with the efficient functioning of the free market. But I doubt CEOs and top managers would be so blase if it was their own jobs that were to be outsourced. I’m sure India and other developing countries are teeming with intelligent, capable entrepreneurs who could probably do a better job than many of our current crop of avaricious business leaders, and at a fraction of the cost.

Besides, the free market already functions inefficiently – the rich domestic markets of multinationals are still quite well-protected fortresses. And, though we may have freer movement of goods and services than in the past, the movement of labour is severely restricted. In a truly free market, workers would go where the best-paying jobs are, rather than the jobs going to where the worst-paid workers are.

More importantly, at its core, economics is about human wellbeing and if free-market orthodoxy fails to deliver on this, then something needs to be done to balance efficiency against ethics.

This column appeared in The Guardian Unlimited’s Comment is Free section on 31 January 2010. Read the related discussion.

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Huff and puff brought the economic house down

 
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By Christian Nielsen

How the Mr Bigs and their biglettes unwittingly (or not) brought down the world’s economies – and the hotly contested prize for ‘America’s worst investor’.

5 October 2009

Two stories in The Economist have more in common than perhaps the magazine intended. One, accusing the MBA factories of doing little to mend their habit of churning out ever-smarter greedy buggers. The other, announcing a Golden Raspberry-inspired prize for the worst small investor in the United States.

I’ll deal with the MBAs first. But before starting, I must confess to having a Belgian derivative of this certificate. It never did me any good, bar an excuse to stay in the country. But the Mr Bigs of MBAs – I’m talking about the likes of London Business School, Harvard Business School (HBS) and others on the yearly ‘best MBA’ courses list – deliver a cohort of big achievers year on year, at a not inconsiderable cost to the students or their organisations.

These Mr Bigs and their biglettes have done sweet f-all to mend their Gekko-esque educational model moulded round the mantra that “greed is good for everyone, especially me”.

The bankers have, at least in principle, been stripped of their pinstripes and, if France gets its way, their future fiduciary roar as well. But until I read this trumpeting repost by Schumpeter (‘The pedagogy of the privileged’), I hadn’t considered the degree of culpability that the elite education machine should perhaps also bear. He says these institutions of learning have been “churning out jargon-spewing economic vandals”, the likes that lined the executive tables of such feted organisations as Enron, Lehman Brothers and half of the Wall Street walkers now offering good CV and an ego-massage to anyone who‘ll now listen.

Yes, blueprints for betterment have been drawn up by some of these fine establishments, The Economist says, but little has emerged of note. No, wait, HBS has introduced a voluntary pledge “to serve the greater good” and a group of Harvard students have set up an oath of “responsible value creation”, according to BusinessWeek’s website.

(Makes you wonder  if that ‘greater good’ is of the kind you would hear espoused at a GOP rally: ‘make shit loads of profit and let the rest take care of itself’. Sound familiar?)

So, if the bankers are going to be made to pay – just a little, and even that isn’t a given because, like a mugging, as the economy starts to show signs of improving, it’s easier to forget the trauma – why not the manufacturers of the greed-is-good method of wealth creation?

Perhaps business schools could start teaching history as well, it was suggested, to remind graduates that the laws of gravity work for money markets too. Taking a knife to the climate of “boosterism” – puffing up the models and methods of certain businesses, people or consultancies – prevailing at some business schools was also put forward as an antidote to acolyte-building academia.

“Business schools need to make more room for people who are willing to bite the hands that feed them: to prick business bubbles, expose management fads and generally rough up the most feted managers,” Schumpeter concluded.

Perhaps we need a matrix to help explain this. Any bright MBA grads want to help us out with that?

Spurious connection

I’m going to make another confession; I didn’t really have a strong ’connector’ for this second story. It just sounded like a really fun idea to highlight: the folly of investment-envy and the slavish adherence to the sort of MBA-inspired confidence that drove people to think they were on to a winning investment strategy for ever.

With some careful analysis, you could probably make a fair case for one relating to the other, but I don’t have the smarts for that – my MBA was a bottom-shelf affair.

The deadline to apply for the ignominious title of ‘America’s worst investor’, the contest organised by Hedgeable.com, is 12 October. Don’t miss this train too! With no shortage of contenders, this is an admirable effort to poke the wounds of this year’s economic fiasco, and perhaps in doing so, remind us that even smart people can make some dumb decisions.

Read Reuters Blogs for some commentaries on how some small and medium-sized American hedge funds and asset managers got their clients (a lot of them retirees) in the hock with exotic derivatives.

Watch this space for expert commentary and sharp(ish) analysis on the winning losers.

Side note: Chronikler would be happy to publicise any effort to set up a ‘Europe’s worst investor’ prize. The Americans are offering the winners – I mean losers – trips to Rome, Las Vegas and Iceland, all home to decent collapse some time in the last 2000 years. Perhaps the European winners could win a trip to Wall Street or the City. Just a thought.

©Christian Nielsen. All rights reserved

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Introducing equanomics

 
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By Khaled Diab

Governments need to rethink their economy policies to make them more equitable and responsive to citizens’ needs.

January 2009

Reading the business pages is like wading through a nuclear wasteland littered with ‘toxic assets’. Gordon Brown is now working to limit the damage from this radioactive debt with a multi-billion pound safety net for the financial system. This, along with the hundreds of billions the government has already pledged, not to mention the tens of billion it has already spent, has sparked warnings of possible bankruptcy for the UK.

Since it rippled out from the subprime scandal in the United States, the global financial crisis has seen taxpayers exposed to mind-boggling liabilities, potentially counting in the trillions. While the financial sector sends the wider economy into a recessionary tailspin, what have the architects of the disaster been up to?

Rather than face paying the price for the ruin they have visited on others, top executives have been giving each other golden handshakes before donning their diamond-encrusted parachutes and leaping out of the blazing wrecks they have left for governments to keep airborne with both engines burning.

But even in the United States, it seems that people have lost patients with the executive caviar train. Last week, the Senate said it would not approve any more bailout money without strict limits being imposed on executive pay.

The brewing outrage is hardly surprising when you consider that, as millions face the prospect of the dole and losing their homes, top managers are sitting pretty and laughing. Take the Merril Lynch executive who got $25 million for three months work or, on this side of the Atlantic, the €4 million payoff received by the former chief financial officer of Belgian-Dutch Fortis Bank, which benefited from a government bailout to the tune of €11.2 billion.

Even George W Bush, a leading cheerleader of neo-liberal economics who has probably done more than any other president to fatten the bottom line of corporate America, has been making ominous threats. “Anyone engaging in illegal financial transactions will be caught and persecuted,” he recently said. Appalled as I am by the exuberant excesses at the top, as a strong believer in human rights, I cannot tolerate talk of persecution.

What needs to be done is not only to limit executive pay in banks receiving government bailouts but across the board. We need a general cap on earnings, which would be high enough to provide an incentive for people to perform and strive but low enough to prevent major economic injustice.

But that, in itself, is not enough. We need to rethink our approach to the economy and herald in a new age of what I call equanomics, where the success of an economy is judged by how well it improves citizens’ well-being, narrows the gap between them, and truly provides them with equal opportunities.

At present, there is too much of a tendency to regard the economy as somehow existing outside of society. But this false separation has led policy-makers in many countries to put the interests of the market ahead of the interests of the people. Equanomics would remove the false barriers between the economy, markets and society, and social indicators – such as quality of life, education and health – would count as much as macro- and microeconomic indicators.

In addition to maximum and minimum limits on income, under equanomics, salaries would be determined not only according to a job’s market value but also its social worth through, say, an impartial index which draws on the views of experts and the general public to assess the social value of different jobs. Of course, this might mean that top executives will be taxed extra to raise the pay of nurses.

Some will argue that only free markets can create the wealth needed to improve people’s lives and that communism only succeeded in impoverishing societies in its quest for equality. I am not advocating the imposition of a communist dystopia, but the sort of enlightened blend of socialism and capitalism that served Europe well in the post-war years and has helped Scandinavia to have its cake and allow the majority of citizens to eat it.

Besides, free market capitalism has failed dismally to create the utopia it promised. Despite the laudable talk of equal opportunities, economic disparity robs millions of the opportunity to shine and succeed. For example, an upper-class boy in the UK is 30 times more likely to land a top job than a boy from the unskilled working class. Contrast this with the countries with the highest social mobility, such as the Nordic countries and Canada, which also happen to be the countries with the lowest inequality. This means that there can be no equal opportunity without greater economic equality.

The free market, as we currently know it, is actually not an ‘invisible hand’ that dispenses impartial economic justice. The big players, from oligarchs to dominant or pseudo-monopolistic corporations, have a massive distortionary effect on the efficient functioning of the market.

This is reflected in the rapidly rising levels of global income and wealth inequality, which has led the UN to sound the alarm on the possibility of widespread social unrest, not only in developing countries, but also in the United States, Britain, Spain and Greece (which was recently plagued by riots).

In the UK, since income disparity rose at unprecedented rates in the 1980s, those Thatcherite levels of economic inequality have been perpetuated, with the super rich racing even further ahead, the middle classes getting a modest piece of the action, and the lowest income groups being left behind to eat everyone else’s dust.

Of course, given the fact that multinationals are of a size to rival small, prosperous nation states and the financial markets can punish governments for stepping out of line, the need for coordinated intergovernmental action has become all the more urgent. In this regard, governments can harness the power of the EU and other regional blocs, and even reinvent the World Trade Organisation, to make globalisation fairer and more equitable.

The current crisis risks deepening the wealth gap, as millions in the middle and lower income brackets face the prospect of imminent unemployment and pay cuts, while government funds are exhausted underwriting the welfare of the wealthy. We need governments to put equanomic principles at the heart of their policy if we are to avoid widespread social conflict and enhance socio-economic justice.

This column appeared in The Guardian Unlimited’s Comment is Free section on 19 January 2009. Read the related discussion.

This is an archive piece that was migrated to this website from Diabolic Digest

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Trouble in the Baltic

 
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By Khaled Diab

The turmoil submerging Latvia is an example of ‘drizzle-down’ economics in action and has implications for the rest of Europe.

February 2009With a population of just over 2 million and a GDP about the size of the Bank of America bailout, the tiny Baltic state of Latvia does not make the headlines very often.

While attention is distracted by the deafening popping of bubbles in larger economies, Latvia has been imploding dramatically in one of the world’s most extreme versions of ‘bubblenomics’. The latest chapter in Latvia’s unnoticed turmoil occurred this weekend with the collapse of the Latvian government.

Prime Minister Ivars Godmanis, who led the march to independence but has been embroiled in corruption allegations, was forced to resign. This makes Latvia the second European country, and first EU member state, to lose its government as a result of the global economic crisis. Although Latvia has been through about a dozen governments since independence in the early 1990s, this time the public mood is very different.

The day before the collapse, disgruntled citizens of Latvia’s second city Daugavpils, borrowed the (by now) world famous Arab insult, immortalised by Iraqi journalist Muntadar al-Zaidi, and hurled shoes at images of the country’s parliament, the Saeima.

This was the culmination of weeks of turmoil and civil unrest, which peaked with mass peaceful demonstrations – which descended into rioting – in January.

“I’m surprised it’s taken so long to get to this point,” said one protester at the January demonstrations, accusing politicians of “robbing” the people for years. This scepticism and pessimism is a far cry from the hopeful psychological crescendo of the Singing Revolution.

“Latvians are not given to protests or public displays of any sorts, [so] their recent actions indicate the gravity of the crisis,” observes Jeffrey Sommers, a professor of economic history at the Stockholm School of Economics in Riga, the Latvian capital.

And their frustration is easy to understand. The economic crisis has hit Latvia harder than other EU states. In the final quarter of 2008, the country’s economy contracted by a staggering 10.5% and, the ‘Alice in Wonderland’ shrinkage is expected to chop 12% off GDP in 2009, while unemployment, already high, is expected to rise by another 50%.

Until last year, Latvia, with the fastest growth rate in Europe since 2000 (reaching nearly 12% in 2006), was trumpeted as the plucky little ‘tiger’ among the older EU turtles. However, the figures were illusionary in that some of the growth was really a case of climbing back from the 1990s crash. Moreover, its economic boom was based largely on a property bubble and reckless financial speculation, while macro-economic reforms imposed by the World Bank and IMF pushed resource-poor Latvia to dismantle most of its industrial and productive capacity.

Like its neighbours and other former Soviet bloc states, ‘free market’ reforms have largely benefited politicians, a select oligarchy of entrepreneurs with massive political clout and foreign corporations. Rather than ‘trickle down’, Latvia has experienced what could be called ‘drizzle down’ economics in which the few enjoy the sunshine years while the many endure the economic storms before and after.

The immense financial crisis in Latvia prompted the IMF and the EU to offer Latvia a €7.5-billion rescue package in late December. However, the strings attached make clear that this is exclusively a bailout for banks and offers no relief for ordinary Latvians.

In fact, at a time when western economies are raising public expenditure to Keynesian levels, the most hard-pressed Latvians will be expected to pick up the tab through painful austerity measures.

But it’s not just foreign pressure that’s unlikely to bring change. “A new government will likely keep similar economic policies in place,” expects Sommers. “Many privileged Latvians, especially politicians, benefited from the asset inflation in real estate. Many speculators took out loans in euros and they would be hurt by a devaluation of Latvia’s grossly overvalued currency.”

With other central and eastern European countries tottering on the brink of an economic abyss, capitals in western Europe are seeing a different kind of ‘red threat’ coming from the east.

New battle lines are emerging between ‘old’ and ‘new’ EU member states. As the EU’s big four – Germany, the UK, France and Italy – gathered in Berlin, the Union’s eastern member states revealed plans to hold their own mini summit.

“We want to send a clear message that we support the European Union’s position in favour of defending the common market and that we are against protectionism,” said Poland’s Europe minister, Mikolaj Dowgielewicz, in response to aid packages unveiled in France, Spain and Italy to help their domestic automakers.

For its part, Brussels insists that the EU can weather the storm. “Europe is equipped to help the weakest economies,” said Economic and Financial Affairs Commissioner Joaquín Almunia.

The trouble is that, while funds seem to be quite readily available to bail out the financial sector, little of this has trickled into the real economy. EU governments need to find mechanisms for directly stimulating the economy and boosting employment perhaps by channelling funds directly to SMEs.

Excessive protectionism could well hurt Europe, but the single market needs to be complemented with robust common labour standards, as well as an increase in or more effective use of solidarity instruments, such as the structural funds.

This column appeared in The Guardian Unlimited’s Comment is Free section on 25 February 2009. Read the related discussion.

This is an archive piece that was migrated to this website from Diabolic Digest

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