Tag Archives: social

Confronting Demographic Change

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Confronting Demographic Change is the title of a two day conference currently being organised by Employment, Social Affairs and Equal Opportunities Commissioner Vladimir Spidla. The emphasis of the conference is on gender and family impact issues.

You can find a background briefing paper here.

This is also an interesting presentation.

Here’s a summary of the objectives. It’s very ‘commission speak’ of course, but at least it marks a growing recognition of the problems we are all going to face. I’m also intrigued by something: “Demographic changes, globalisation and rapid technological change are the three major challenges facing Europe today”. I’m intrigued to know when the hell they figured this out, especially since (if for globalisation you read China) it is something I have been arguing for over five years now, in this precise combination.
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The Low-Fertility Trap

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I suppose by-now every right thinking and reasonably well read adult knows what the ‘poverty-trap’ is, even if most of us aren’t too clear about what there is to do about it. Being stuck in one of these traps could be thought to be like being stuck in a (not necessarily very deep) well with a slimy surround wall. The more you struggle to get out, the harder it gets: your strength disippates, and the walls get to be even more slippery. This could also be called a negative feedback loop.

Well now there is the suggestion that something similar may exist in the world of fertility. As Wolfgang Lutz suggests in this power point presentation, the critical level may be 1.5. No society which has fallen below this level has -to date – returned above it. (Many thanks here to commenter CapTvK who sent me the link).
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Cannons To The Right Of Me, Cannons To The Left Of Me

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Gerhard Schröders electoral troubles only seem to increase. With Merkel’s lead seemingly consolidating rather than reducing, a recent poll now shows the alliance between the former communists in the east and Election Alternative in the west set to win 8% of the vote:

Experts say the new group could attract votes from Social Democrats in the west unhappy with Schroeder’s efforts to trim social programs, and from unemployed people in the economically depressed east fed up with his recent cuts in unemployment benefits.

A poll showed the alliance getting 8 percent ? well over the 5 percent barrier needed for representation in parliament. Schroeder’s party had 27 percent, trailing the conservative Christian Democrats of challenger Angela Merkel at 44 percent.

The poll, for ZDF television by the Mannheim Election Research Group, surveyed 1,175 people June 21-23. The margin of error was plus or minus 2.7 percentage points.

The new group showed its appeal Tuesday when veteran Social Democratic legislator in the state of Baden-Wuerttemburg defected to take up its cause. Ulrich Mauer, the party’s former regional head, said he was joining the left alliance because it was “the only chance” to stop the advance of the center-right.

Promising Elections

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The Guardian today has a short profile on Angela Merkel, while the FT looks at some of the proposals which may well form part of the SPD campaign manifesto. Far be it from me to worry about ‘sting the rich’ tax proposals, but as far as I can see the main isssue is getting Germany back to work, and Schr?der’s time might be better spent adressing this issue.

Talking of which, this could be a good moment to mention the whacky world of Hans Werner Sinn.
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Prodi Strikes Back

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I think one of the topics for next years election in Italy is just being decided. Romano Prodi (former President of the EU Commission) has just spoken out against Sinascalco. He is in favour of making cuts. Prodi is quoted as saying that:

“Credit downgrades will follow if there is not quick action in fixing the situation, and I do hope Finance Minister Siniscalco makes some decision……The government lost control of current expenditure. The situation is very serious.”

Prodi is about to become the whipping boy, having to go into an election with the ‘popular’ policy of making widespread spending cuts.

Incidentally,
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Germany On The Road To Reform?

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“Voting for the C.D.U. Sunday meant putting a stop to Schr?der’s reform agenda…..But in the future, if the C.D.U. has power, there is no stopping the reforms.” says Morgan Stanley’s Elga Barsch (remember her?). This argument draws attention to an important enigma which must be puzzling a lot of people. As the New York Times puts it:

“If voters are angry about economic legislation that rolls back the social welfare state, and they take out their anger on the governing party, does that make more such legislation inevitable?

As undemocratic as that might sound, investors in Germany seem to think so. As financial analysts said chances of new legislation had increased, the country’s stock market rallied Monday after a stinging defeat in regional elections for the Social Democratic Party of Chancellor Gerhard Schr?der, which led him to call for national elections in the fall.”
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Kapitalismus III

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More from behind the great PPV firewall. Unfortunately only the reproduced extract is available to non-subscribers (like me):

The German economy, once the economic powerhouse of Europe, is stalling. Annual average growth in gross domestic product since 1995 has been just 1.2 per cent, unemployment has increased since 1970 to 11 per cent, the social security system could no longer be financed even if the population were not ageing, and the government’s finances are in disarray. This is a knot of problems, and it is difficult to disentangle the many threads, isolate one issue and solve it.

Unfortunately, Germany also finds itself in a political trap. Germans have become accustomed to the current high level of GDP used for social protection. In the west, this is due to earlier expansion of the welfare state; in the east, to the expectation of equal treatment created by the one-to-one exchange rate chosen for unification of the two halves of the country in 1990. Unfortunately, expectations determine voters’ behaviour, and political parties anticipate how the electorate will vote. Politicians are reluctant to tell the true story and to propose the reforms that are necessary. Witness the campaign leading up to Sunday’s regional election in North Rhine-Westphalia, where Gerhard Schr?der’s Social Democratic party, facing defeat, has stepped up its anti-capitalist rhetoric.

I think this is a clear statement of the problem from Horst Siebert. Of course we may all agree on the diagnosis, and yet beg to differ over the medication needed. Even if you can’t get through the firewall, you can browse his complete book at Amazon.

21st Century Socialism.

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As all of Germany seems to engage either in market or Marx bashing these days, I thought it is time to add my two cents to the debate – and I’ll do it with the help of the US Europhile Jeremy Rifkin, who gave the “Stuttgarter Nachrichten” an interview about an old book of his, “the end of work.” The current German debate – the “Kapitalismuskritik” (“capitalism critique”) – is the result of a surprising lack of political imagination, a lot of disappointed social democrats, an important regional election in May, and the lack of a referendum about the European Constitution that would serve to channel the electorate’s fears, as it just happens in France.

Despite the fact that almost everyone, including business professors, in Germany – just as everywhere else – agrees at least theoretically, that there are issues to be debated with respect to the way our economy works, including obvious CEOcratic excesses, the political participants don’t seem to be able to update their class-struggle vocabulary to the needs of the 21st century. While I always thought “the left” had won a conceptional edge over so-called free-market fetishists by accepting that markets are “one coordinational mechanism among others”, I’m not sure about that anymore after having to endure the conflicting and confusing use of so many economic terms by leading German Social Democrats.

Thus, I suppose it was a good idea of the German government to invite Jeremy Rifkin to talk about his ideas concerning the future, or rather the end of work as we know it.
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