Did Russia come out ahead in the gas crisis?

Expanding on (and slightly copying) my comments in Edward’s post below, I was really shocked to see the spin in the western coverage of the Ukrainian gas crisis. The part that didn’t shock me – just made me groan – is the spin of a western press that seems to have decided in advance that Russia must be the bad guy, so Ukraine must be the good guy. Russia may be the bad guy, but I don’t think is Ukraine is the good guy. From what I can tell from the press, Russian claims that Ukraine was siphoning off gas seem well founded – Russia had been complaining since summer about siphoning, Gazprom was willing to let third parties audit the difference between what was going into Ukraine and what was coming out, while Ukraine refused. Also, it seems that the Russians weren’t the only ones making allegations about siphoning. Yes, Russia’s intentions towards Ukraine are not honorable, nor is this some purely commercial conflict free of political meaning. But, that does not exclude the prospect that Ukraine was screwing Russia.

But what really surprised me was the claim that Russia was the loser here.
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The End of the Dolce Vita?

Are the good times and the good life still going to continue to roll in the Italy of the twenty first century? This is the core question the Economist’s Europe editor John Peet asks in the latest Economist Survey: Italy, Addio, Dolce Vita. As Peet says:

Italy is approaching a crunch. Rather like Venice in the 18th century, it has coasted for too long on the back of its past success. Again like Venice, it has lost many of the economic advantages which underpinned that success. For Venice, it was a near-monopoly on trade with the East that paid for the creation of its beautiful palaces and churches; today’s Italy has benefited hugely from a combination of low-cost labour and a switch of workers away from low-productivity farming (and the south) into manufacturing (mostly in the north). But such good things invariably come to an end.

Italy badly needed a dose of pro-market reforms, liberalisation, privatisation, deregulation and a shake-up of the public administration, all of which Mr Berlusconi had promised. He even pledged to cut taxes. A majority of Italian voters, backed by much of Italian business, were willing to overlook both his legal entanglements and his conflicts of interest and give him a chance to reform the country. But as the next election approaches, very little of what he promised has been delivered, so many of his erstwhile supporters are feeling disillusioned.
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M’s very own locusts.

After starting off this year’s early election campaign with a debate about the dangers of the sometimes problematic short term investment horizons of private equity firms, it was the SPD’s very own loony left’s locusts in the party’s board that forced their chairman, Franz Müntefering, to declare that he would not seek re-election at the party conference next month and that he was no longer certain whether he could then serve as the minister in a grand coalition. Certainly, given that surprises seem to have become the rule in German politics by now, things might look different by then.
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Fischer’s gain, America’s loss?

Michael Moore gives us a thoughtful article about Joschka Fischer (and some priceless Fischer anecdotes) in Slate today. Before going any farther I should make clear that I refer not to the notoriously fat filmmaker but to Michael Scott Moore, an American novelist living in Berlin. Of his fatness or otherwise I am entirely ignorant.

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Is something happening?

As we have been able to witness with unfortunate regularity lately, not every election helps move politics forward. Fortunately, some still do.

While Sunday’s regional election in the Austrian state of Steiermark, which was widely expected to be the decisive reason behind the Austrian government’s determination that the treaty opening EU accession talks with Turkey – which were supposed to start with a (now postponed) signing ceremonyat 5pm CET today – explicitly include the option of a non-standard membership or so-called privileged partnership, did not help to overcome the impasse, the by-election in Dresden seems to have shifted the balance of power in the race for the German Chancellory to the extent that Chancellor Schröder told RTL television – before attending a meeting of the SPD’s steering committee this afternoon – that (my translation, German from Spiegel Online) –

“… this is not about me. It’s about my party’s entitlement to lead, and only the party leadership can decide about it. I will accept whichever decision will be made. I don’t want to impede the development of the reform process which I have started or the formation of a stable government for Germany.”

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German Confidence Indexes

The sharp eyed will have noticed that I have copiously refrained from commenting on the unexpectedly high reading obtained in yesterday’s German Ifo Institute Business Climate index. The index registered a slight unexpected increase, but as Ifo President Hans-Werner Sinn notes: “An evaluation of responses submitted before and after the federal election showed a tendency to more unfavourable expectations after than before the election, so the reading may in fact say a lot more about sentiment before rather than after the election.

More informative in many ways may be the Gfk consumer climate survey out today (follow link and click on button). The survey, which attempts to forecast the climate going forward, saw an increase in the number expressing scepticism about private income expectations and the propensity to buy:

While in August this year the consumer mood was still relatively unaffected by the hike in oil prices and yet fired by the prospects of the elections, both the tax reform and the trend in oil prices seem to have been felt in September. Indicators covering private income and private consumption are particularly affected. Consequently, the consumer climate was also slightly down. In contrast, economic prospects have become more optimistic. The findings of the September survey given below do not reflect the outcome of the recent elections, since the survey was completed just before the date when the elections were held.”

At the present time it is very hard to assess what the impact of Germany’s election stalemate will be on the economic climate moving forward.

Another Grand Coaltion: The Sun of Jamaica.

Over on Crooked Timber, Henry Farrell – I think somewhat accidently, because I get the impression he believes Germans do *NOT* want to change their distorted labour incentive and tax systems – writes about the fundamental reason for the result of last Sunday’s election.
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Catastrophic success?

In one of his many excellent pieces in the run-up to the German election, Alex mentioned the phenomenon of ‘overhang mandates’. These are extra parliamentary seats that a party gains by winning more seats via one of German’s two electoral methods than by the other. This might seem odd enough. What’s even odder is that a party could lose a seat if too many people vote for it.

German electoral law is complex. In a comment to one of Tobias’s posts, Florian recommended the wahlrecht.de website as a good primer on how it works. He also mentioned examples of some of the electoral weirdnesses explained by wahlrecht.de. For example, did you know (asks Florian) that, under certain circumstances, a vote can have ‘negative weight’ — can reduce the parliamentary representation of the party for which it is cast?

Well, it can. And this conundrum is worth looking at closely, because right now it is more than a mere electoral curiosity. There is one electoral district in Germany, Dresden I, that has not yet voted. (Those who’ve been paying a perhaps unhealthy level of attention to the German elections will know that the death of a neonazi candidate has forced the delay of the election.) And in Dresden I, there is a very real chance that a local triumph of the CDU could cause the party to lose a seat in the national parliament. The reason? It’s those overhang mandates that Alex kept mentioning.

Excellent as wahlrecht.de is, it’s in German. Below the fold, then, is a summary explanation of how the CDU could lose a seat by gaining votes. For those who read German and are interested in that sort of thing, there are links to the relevant passages of the BWahlG (German Federal Electoral Act).

In the mean time, we should note that the possible ‘negative weight’ of CDU votes in Dresden I, though perverse and undemocratic, would not affect the overall results in Germany. Even if the CDU are ‘catastrophically successful’ in Dresden I, the Union will still have more seats than the SPD, albeit with a lead of only 2 rather than 3 MPs. The really perverse thing that could come out of the Dresden special election is this: CDU and SPD wind up with an equal number of seats. As the Spiegel explains, however, this is mathematically a possibility, but in real-world terms exceedingly unlikely. To achieve this result, the SPD would need to poll 91% of voters in the district, and every single eligible voter would have to vote.

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Apparently 粗大塵 does not mean what I, judging by the context, had thought it means

I’ve been harshing on the Union and their little dog Toto the FDP pretty nastily throughout the campaign.1 Surely, though, I should spare a thought for Die Linke.

It’s easy to fail to pay the ‘Left Party’ the attention they deserve, mostly because nobody is likely to form a coalition with them. But still it should be noted: they did very well in this election. They should receive the congratulations they deserve.

Congratulations, then, wendebeschädigte East German communists: you polled surprisingly well, once you put yourselves under a West German carpetbagger.

And congratulations, Oskar Lafontaine. Many years ago you were the only major German political leader willing to speak the truth about the cost of unification. What a way you’ve come since then, finishing your career by becoming the first West German head of the SED.
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