Current Affairs 2010-05-25

Where’s the pressure on Thailand?
Thailand is a relatively modern developing country. It’s a coherent state, rather than a colonial mash-up of the type found in Africa or the Middle East, with a rich history and reasonably friendly to the West. There’s no indication that Thailand may be heading towards a different ideology, such as totalitarian communism or an islamic theocracy. Thailand is much more open and closer to the West than China. Why, then, do we sit idle while its government is using its army to shoot and kill protesters who are occupying the streets of central Bangkok asking for democracy? It’s a clear enough and understandable (to us) demand. The protesters feel that the ruling regime is illegitimate and want open elections whose outcome is honored. What could they ask for that’s more in line with our highest values, in the West, when it comes to governance? Why aren’t our governments sanctioning the Thai regime already? Why aren’t American and European leaders making it absolutely clear to the Thai elite that from our point of view their time is up, and they must accept a UN-run election if they want constructive engagement with the world?

North Korea should be an easy case
From the point of view of the center-right Western powers, Cuba is a difficult case. There’s communism that actually works well in terms of human development indicators and outcomes are dramatically better than the nearby basket cases of Haiti, Dominican Republic, or Grenada. So if you want to change the regime of Cuba that should be difficult, as it has been. Now look at North Korea. It is an economic and human ruin. The state is as a fascist horror and it is also hollow. There’s no pretense at ideology that might, perhaps, if everyone went along with it, work. North Korea is simply the personal fiefdom of one family of hereditary rulers. Neighbouring South Korea, although not free from struggle and suffering, is a glowing success by any standards. The two countries share a culture. If there was ever an easy case for regime change, North Korea should be it. Why is it so hard to depose one dictator and his sons and allow the country to unite with its powerful developed sibling, just like Germany? I remember in the late 80s Mr Gorbachev did a tour of the Eastern Bloc countries, presumably had a frank chat with each of their leaders, and they all toppled a few months later. Isn’t it time for Mr Jintao to pay a visit to Mr Jong-Il?

The Lib Dems blew it
The worst thing a politician can do, short of being personally caught in corruption, is to openly seek power for its own sake. There has to be a reason for coming to power, such as to fix social ills or otherwise enact positive policies. Seeking power for love of power is, and should be, a signal to vote the politician out of office. While it was reasonable for Britain’s Liberal Democrats leader Nick Clegg to join a coalition with the conservatives, the Lib Dems were voted in because of their stance on policy, which is different from the Conservatives’ policy. An honorable coalition would thus be a compromise, where Clegg accepts a share of government but affirms that his policies are distinct from Cameron’s. The two leaders should be visibly in conflict, most of the time. Instead, Clegg was so delighted to get a shot at government after his party was excluded that he essentially hired his and his MP’s services to the Conservatives. In my view this is not lost on the Lib Dem electorate, and I expect the party to be consigned to the backwaters of British politics for decades due to this mistake.

Why not lose €0.10?
The Euro is clearly in some trouble. The larger EU economies have had to absorb risky debt from Greece, and it looks likely that they may have to absorb some more from Portugal, Spain, or some other weak economy. German chancellor Merkel wants the solution to be fiscal prudence for all member states, so that no-one can run budget deficits. Although a good long-term goal, this is naive as a short-term solution in my opinion. Germany and a few other countries are unusual in being able to run surplus budgets. Even powerful states such as France or the US run deficits. And Germany or China wouldn’t run surpluses if other states didn’t run deficits. For historical reasons Germany doesn’t keep a large army, while Greece and the UK do (for different reasons). EU convergence must run a lot further ahead before member states can be treated like municipalities, which are able to draw on central support but are expected to balance their books. So in the absence of such miracles, there are three ways to resolve the Euro risky debt/deficit issue: Default, austerity, and devaluation. The last option is clearly preferable but it is taboo. Why? Surely a modest drop of the Euro, say 10c, would calm markets while hurting very little, if not benefiting the export economies. What sort of reasoning or interests keep this obvious option off the table?