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Showing posts from September, 2010

Facing corruption in Estonia

There has been a certain amount of anguished debate in Estonia over the past few weeks over the way that Lithuania has been successfully attracting inward investment and Estonia has not. To a degree the comments from the Estonian establishment are well taken: Lithuania has been better at marketing and at providing incentives that the Estonian government -as a matter of principle- would not.
However, this is not the whole story, and the Estonian government needs to understand the consequences of several critical decisions that have been taken over the course of the past few years. In short, the country is in grave danger of losing its hard won reputation for open and fair dealing with international investors.
The fact is that few of the major international investments in Estonia over the course of the past few years have gone smoothly. The American investment in Estonian Railways ended in acrimony and a more or less forced renationalisation. The American investors were caught between …

Classification of Books

As I was passing through the bookshop in Heathrow Terminal 3, I noticed that some wag had placed a copy of Tony Blair's turgid tome The Journey in the "True Crime" section. Seemed about right to me, even the prose is an offence against nature... and as for the sanctimonious waffle, words fail me, and I wished they had him too.

The healthy state of the Lib Dems

Just a few brief observations on the Lib Dem conference in Liverpool:
The expected media narrative of party splits and challenges to the leadership and the coalition was never going to happen. The party in a special conference in Birmingham just after the election had already agreed to support the Clegg leadership- even knowing that the coalition was going to be at times quite uncomfortable. In fact the ritual leadership defeat, this time on "free schools" was fairly half hearted and, given the government's significant failures of presentation, totally expected. In fact the conference has been marked more by sycophancy to Nick Clegg rather than challenges to his leadership (If I hear "I agree with Nick" once more, I reserve the right to puke).
The news of significant growth in party membership and party coffers is very interesting and rather off-sets the Labour narrative (enthusiastically promoted by the BBC and the Guardian as the conference began) that the Lib …

Unemployment: a Liberal solution is in our own hands

In the last big recession, at the beginning of the 1980s, Unemployment became a national spectre. News at Ten would intone in doomed tones the details of the latest job losses around the country, and often the numbers of jobs going were truly appalling. Thousands were laid off, and entire towns lost their very reason to exist. This recession, so far, has been different because unemployment has not in fact risen in quite the same way. Given the various changes (read: fiddles) that governments have adopted along the way in order to reduce the official unemployment rate, the numbers might be expected to be lower anyway, but in fact the population of the UK has risen quite sharply over the course of the last thirty years, so even a three million unemployed level would be quite a lot lower as a percentage than three million unemployed was in 1981. In fact we have got nowhere near that level... yet.
The crude statistics hide more than they reveal: public sector employment was about 19.3% o…

Never be rude to an Arab

For those of us of a certain age the fact that the lunatic American "Pastor", who wants to burn the Koran, is called Terry Jones is an occasion of some mirth.
The Pythonmeister Terry Jones had clearly already prefigured his namesake's future difficulties in the lyric melody of "Never be Rude to an Arab":
Click below for details:
http://www.youtube.com/watch?v=F67JhKT5bxU









The Ninny State

The constant invasions of the state into affairs that are purely personal is a matter of critical public debate worldwide in these early years of the millennium.
The Chinese state, historically, gave its citizens few if any defences. At the benign extreme, this led to a rather bland social consensus dictated by state approved Neo-Confucianism; at the other, the murderous horrors of the "Great Leap Forward" and the Cultural Revolution. Even at the highest level of the Chinese Communist Party, there is a recognition that the rights of the individual should be given a lot more voice- indeed there is a substantial minority who would now argue that China should be making moves to full democracy.
In the West where what passes for full democracy is already in place, it is clear that the promise of democracy in terms of personal freedom and fulfilment is not being met. The rights of the individual have often been subordinated to the limited private interests- and corporations can oft…

France, America and China

I am in deepest France- La France Profonde- although my journey here was rather hampered by the usual French strike- in this case Air Traffic Controllers. I was only delayed, but plenty of flights from all over Europe into Toulouse had been cancelled. The ostensible reason for this outbreak of radicalisme was a proposal to raise the retirement age in France to 62. Since the de facto retirement age in the UK is already creeping up towards 67, it is hard to feel much sympathy. As BBC radio was quick to point out a couple of days ago: the French already sleep more, work less hours, have longer holidays, and spend more time eating than any other nation in Europe. You might think that this would be a recipe for health and happiness, but the neuroses of the country remain has angst filled as ever. Also they eat more Macdonalds than the Brits, and to be quite frank the standard fare in a French restaurant is more expensive and far less varied than in the UK- the identikit menus are an exerc…

Education: rationing by scarcity or by price?

The dread news comes through- conveniently enough just at the beginning of the negotiations for the new year's University funding- the UK has fallen drastically in the number of graduates per capita that it is producing. We are now apparently supposed to be shocked that such countries as Slovakia and Slovenia are now above the UK in the OECD ranking. Well, could it be that this is because these countries have only just joined the OECD, so their statistics are only now being included for the first time? In which case, the UK can certainly expect to be behind Estonia, when they join the OECD early next year, since about 40% of the Estonian population takes some kind of further education or training.
Even if there is a genuine problem, given the propensity, even willingness, of graduates from Slovakia or Poland to come to the UK, does it mean that there has to be any change in the UK-s overall competitiveness? The fact is that the British education system, though not quite such a ba…

Taxing? Simples...

Over the past few weeks in the UK we have seen several stories about mistakes being made in tax calculation. These are not just the possible small discrepancies of a few- but a fundamental miscalculation of what is due by the revenue itself 1.4 millions are said to be due to pay more. Yet this morning, it is reported that over 10 million may now qualify for refunds.
Reduced to essentials, it is clear that the tax system is now so complicated that even the revenue themselves can not understand the system.
It is a matter of urgency that the UK simplifies the tax system. Apart from anything else, the mistakes that are being made cost millions, even billions, of Pounds to put right.
There are plenty of models out there, but speaking from an Estonian perspective, the simpler the tax code, and the easier it is to calculate and to pay, then the more tax revenue is raised.
Of course, that then allows the rates of taxation to be lower for any given level of revenue.

Revitalising the cult of Equity

The value of experience in any industry is to identify when something apparently new turns out to be an idea that has been rejected by a previous generation- often for a reason that is fundamental and fundamentally obvious, but which is discounted by a current generation of managers. For some reason, probably because the turnover of staff is so rapid, the City of London seems particularly adept at forgetting some hard learned lessons from the past. Experience in the City takes second fiddle to innovation.
Innovation in finance is part of the fundamental warp and weft of the whole business. It is through innovation that different firms seek to gain a competitive advantage and thus the young whizz-kid, who in most other industries would still be climbing the corporate ladder, in finance commands the highest rewards- including extremely high salaries. Yet, as we have seen from the recent financial crisis, there is a risk in preferring innovation over experience: there are few who dare to …

Looking after number one in Belarus

The last six months have seen an extraordinary change in the political direction of Belarus- sometimes known as the "last dictatorship in Europe". Alas, while "Transnistria", Azerbaijan, Armenia and even Russia are considered European, then Belarus' claim to fame is not as unique as all that.
Nevertheless the eccentric rule of Oleksander Lukashenka has continued. His fairly brutal security police continues to be called the KGB, and the flag of the country remains essentially that of the Soviet Republic. Yet, despite the extremely close relationship with Russia, including participating in the "Russian-Belarusian State Union", the country has managed to maintain its independence, despite continuing predictions of full union under the Kremlin. Historically the dictator has been extremely loyal, not to say slavish, to the Russian government.
It is the relationship between Mi'nsk and Moscow that has changed, rather than any great opening up of democrac…

Darwin award nominees

Not sure why , but the latest crop of headlines gave me a very extreme attack of the giggles:
Firstly, a dullard school student who electrocuted himself by connecting his nipples to mains electricity is trying to sue the teacher at the school where this took place, because he should have warned him that this was dangerous. Frankly the idea that this guy could still contribute to the gene pool is a fairly scary prospect.
The second story, sadly shows that the gene pool does indeed remain contaminated by spectacular stupidity: a father seeking to drive a spider from behind a toilet by spraying a highly flammable aerosol at the unfortunate arachnid... and then lighting a match. The subsequent explosion caused structural damage and put our intrepid spider hunter into hospital. The fate of the spider is unknown.
Just another day of reporting in the Daily Mail...

Looking to the past in Somaliland

Somalia is one of the most benighted places on the planet. Staggeringly violent, desperately poor, it regularly comes last in any ranking of the nations of the Earth. Since the collapse of the Somali state, nearly twenty years ago, the country has become a extremely dangerous anarchy. The capital Mogadishu, once known as the Pearl of the Indian Ocean, now stands in ruins.
Somalia is the number one example of a failed state. It has no government.
In the face of this breakdown, it is worth considering that the state of Somalia, created in 1960, rests on two historic foundations: the former colonies of Italian Somalia and British Somaliland. Under the repressive regime of Said Barre, the two were forced into one. The fall of his regime, and the subsequent collapse of the state led to the emergence of a separate government in the former British Somaliland.
It is by no means a utopian state: it remains extremely poor and undeveloped. However, compared to the rest of former Somalia, Somaliland…

Blair Fantasia wrecks his party

Tony Blair's enemies are legion. Many express themselves forcibly: he is a "political shape shifter", "unprincipled or deluded", "master of lies and spin", "the ultimate hypocrite". Gideon Rachman in yesterday's FT, suggests that the hatred of Blair is overdone, and that eventually a more balanced view will emerge.
Perhaps this may be true about some of his policies in office, but the huge mistakes that Blair made are obvious to even an unbiased observer. The half baked version of devolution that Labour offered will cause us constitutional problems for years to come. Even what Blair regards as his greatest success, the Northern Ireland peace process, was largely the work of Mo Mowlam, and even that -which he was so quick to claim the credit for- remains dangerously incomplete. The huge increase in government expenditure that he presided over led us to a national financial crisis, and his "reforms" of the NHS drastically incre…