A Dog’s Life In Latvia

From Vyacheslav Dombrovsky:

Just when you thought there is nothing that can surprise you anymore in this country, comes this. LNT’s “Degpunktā” reports that Valmiera state prison had four special guards dogs shot as part of the “economy regime”. Apparently, the guards couldn’t bring themselves to do that so they called in an outsider and gave him a gun. I wonder if that’s the kind of measures that Mr Slakteris, the minister of finance, meant when he famously told the Bloomberg TV that “we will be …taupÄ«gi [economical].”

But more seriously, this is another point to the case that “wage devaluation” just does not seem to be working very well in the public sector. In theory, what was supposed to happen is mostly nominal adjustment in wages of public sector employees, without affecting the supply of (useful) services of the public sector. It’s hard to call the above case a “nominal adjustment”. Having fewer guards dogs will make it easier for inmates to escape, which is a pretty real effect as well. Generally, there seems to be growing evidence that the economy regime is largely about cutting the supply of public services, and not just a nominal decrease in wages. This is not how it’s supposed to be.

Meanwhile, it seems that in Latvia, the expression “being treated like a dog” assumes a whole new meaning…

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About Edward Hugh

Edward 'the bonobo is a Catalan economist of British extraction. After being born, brought-up and educated in the United Kingdom, Edward subsequently settled in Barcelona where he has now lived for over 15 years. As a consequence Edward considers himself to be "Catalan by adoption". He has also to some extent been "adopted by Catalonia", since throughout the current economic crisis he has been a constant voice on TV, radio and in the press arguing in favor of the need for some kind of internal devaluation if Spain wants to stay inside the Euro. By inclination he is a macro economist, but his obsession with trying to understand the economic impact of demographic changes has often taken him far from home, off and away from the more tranquil and placid pastures of the dismal science, into the bracken and thicket of demography, anthropology, biology, sociology and systems theory. All of which has lead him to ask himself whether Thomas Wolfe was not in fact right when he asserted that the fact of the matter is "you can never go home again".

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