With the release of Abdel Baset al-Megrahi, who was convicted of the 1988 Lockerbie Bombing, has reflected a broader international “coming out” for Libya. It is as if, like the Al-Megrahi, Libya has served its time as a terrorist-funding pariah state, and now sufficiently punished for its crimes, the global community can accept a rehabilitated ex-con into their fold.
Yet, Libya has had a difficult relationship with the world since Muammar al-Gaddafi seized power in 1969 with his unique brand of “Islamic Socialism”. The international ostracisation peaked in the 1980s, with a string of terrorist incidents ranging from targeting foreign air carriers, to bombing a disco in Berlin. The UN, as well as the US and EU, established a strict series of sanctions to formalise the regimes isolation.
But after the admission of culpability, the sanctions were quickly removed, which, in tern, broad rapidly improved relations. Nicholas Sarkozy was one of the first world leaders to court the Libyan leader, with France and Libya releasing the following joint statement in 2007 which aims to:
“affirm their desire to give new momentum to bilateral relations, and to build a strategic partnership between the two countries,”
The UK Government has recently admitted to arms sales worth £9.4 in 2009 so far, adding to £14.4 million contracts for the whole of 2008.
Although Venezuela has never held the same notoriety as Libya, it is also an oil-rich nation with a maverick reputation. After characteristically bold comments by Hugo Chavez that Venezuela is seeking to support Iran’s nuclear programme, the UN threatened that punitive action may be taken for flouting a Security Council Resolution. The US has also frozen foreign bank accounts of close allies to the Venezuelan president for supposed terrorist links.
The way these two outsider states have dealt with the Western powers attempted containment, however, has been markedly different.
Chavez has returned to his home in Venezuela after an 11-country tour of the world, including Belarus, Iran, and Libya amongst others black-balled states. The official reason for this shuttle diplomacy was principally to strike new oil deals and re-equip an aging army, but the mission also sought to forge new ties in a burgeoning global anti-American movement.
Chavez, with Fidel Castro of Cuba and Evo Morales of Bolivia, founded the Bolivarian Alternative for the Americas (ALBA) in an attempt to find a Latin American alternative to Washington Consensus neo-liberalism.
Venezuela is keen to promote bilateral, social schemes, such as the internationally recognised El Sistema, a Children and Youth Orchestras of Venezuela, and with oil-based trade programme, such as the oil-for-doctors scheme with Cuba.
A lot of Venezuela’s success is due to the charisma and canny ideological manoeuvrings of the president. Chavez has channelled and united much anti-American sentiment, which has grown rapidly under the controversial stewardship of George W. Bush. Whether these feelings have seen their high-water mark, with Barack Obama using a more conciliatory approach, it remains to be seen whether Chavez can carry forward serious geopolitical momentum.
Libya, on the other hand, differs from the Venezuelan foreign policy in two crucial ways. Firstly, it tends not to conduct its overseas relations by grandstanding through the media. Although a controversial and rather eccentric, Colonel Gaddafi does not match Chavez’s speechifying rants. The Libyan leader has had quarrels with the Italian Government, and has also called for Israel to be “pushed into the sea” he has moderated his views and comments on both these matters, and now prefers to operate behind the scenes.
Secondly, instead of rejecting the Western powers, Libya has directly enticed European powers to take advantage of Libyan oil reserves. Libya is a key stepping stone for illegal immigrants on their way from West Africa to Europe, and now the EU is providing direct assistance to secure Libya’s extensive desert borders. Direct bilateral relations over technical matters have softened the tone, and Libya is enjoying the foreign direct investment that normalised relations bring.
It is important to remember, though, that Libya is still a repressive regime that regularly subject to international condemnation. Whereas, Venezuela, no matter how flawed, is still a democracy. Chavez’s stronger moral mandate allows him to indulge in visionary multi-lateral schemes, yet Gaddafi is struggling for basic recognition. But, nevertheless, there is a sense that the two countries are moving in opposite directions in relation to their respective foreign policies.
Libya is courting its powerful neighbours, and rejecting its historic dubious associations, whereas Venezuela is rejecting its neighbourhood superpower and embarking on new alliances with international rebels. Gaddafi’s conservative strategy of wooing the EU seems reasonably successful, showing hard results immediately. Whether Chavez’s high-risk gambit of uniting the diverse enemies of American capitalism can hold together, is another matter.
Sunday, 20 September 2009
Sunday, 13 September 2009
Health Reform in Europe and the US: Converging or Diverging?
As with many of the political differences between Europe and the United States, we tend to view the Atlantic as a simplistic division; in this case a division between state-run hospitals and market-based healthcare. Alternatively, the ocean separates socialist dictatorship from free-market poverty trap, depending on your prejudice of choice.
Arguments regarding healthcare are never seen through rational eyes however. President Barack Obama has tried to align the United States with the rest of the advanced democracies, by introducing some system of public healthcare. Unfortunately for him, the debate that followed has been clouded, contentious and far from evidence-based.
Similarly, European politicians, burdened with often high health and welfare costs, at a time of deficit-spending, are beginning to look at the American laissez-faire administration with some envy. Although, any considered change is condemned as non-egalitarian. Angela Merkel’s posited reforms, mild by American standards, brought thousands out onto the streets in protest.
Yet, there is some truth in some knee-jerk reactions. Britain’s National Health Service is reportedly the fifth largest employer in the world – nestling behind the Chinese People’s Liberation Army and the nationalised Indian railway system. In the US, of a population of 300 million, 47 million Americans have no medical insurance cover. A further 25 million are thought to have inadequate insurance. Moreover, it is reported that doctors’ bills accounted for 60% of US bankruptcies in 2007. Adding to the pain, in the past nine year premiums for employer-provided schemes have inflated four times faster than wages, and have now doubled in cost.
President Obama’s attempts to reform the American system has been chided by a highly activitist grass-roots movement, and received a bruising in Congress. The most controversial aspect of his plan is the so-called "public option". This seeks to establish a system of Health Insurance Exchanges that would provide government-run care for those eligible – the extent of this eligibility is still subject to political negotiation.
Further still, Mr Obama plans to cover all Americans under the "individual mandate" which individuals would be required to sign into, or face a fine. Disadvantaged citizens may be offered subsidise to assist in the payment on this insurance. The bill would increase healthcare provision to 97% of the population.
The United Kingdom, on the other hand, proudly operates a highly centralised, state-run service, in which the Government provides “cradle to the grave” assistance. For the overwhelming proportion of British subjects, the state is deeply involved in their lives.
And yet, the system is perceived as expensive and inefficient. Condemned by former Vice Presidential candidate Sarah Palin as “evil”, where the lives of patients hung in the balance before unaccountable “death panels.” This may be an exaggeration, but it is wrong to think that state involvement in providing universal healthcare, necessarily means provision of care by and through government. Indeed, although some lazily refer to the UK, when they discuss the "European system" (or communist Russia), there may be tempting alternatives on the continent.
In the German system, clinicians are encouraged, cajoled and incentivised to provide social healthcare through the insurance system. All those earning below €48,000 must subscribe to a state “statutory fund”. The statutory insurance premium is progressive in its claim on an employee’s income, and usually accounts for about 15% of her wages.
Yet, there is no government monopoly of healthcare. Of Germany’s 2,030 hospitals, 790 are publicly-owned, 820 are private not for-profits, and 420 are private for-profits.
Even the briefest walk around any German city will reveal a flourishing cottage industry in healthcare providers. Signs for single-practitioner, privately-operated clinics pepper even shopping high streets. Whereas, primary care in the UK is dominated by a combination of vast general practitioner surgeries and immense NHS hospitals.
Similarly, in France, citizens are subject to compulsory social health insurance contribution. Although private “top-ups” are available, most procedures are reimbursed by the social insurance fund, once the private doctor has performed the issued a bill.
Moreover, government involvement does not necessitate centralised administration. Sweden’s healthcare system is highly decentralised. Although the National Board of Health and Welfare (Socialstyrelsen) plays a broad regulatory and supervisory role, the local county councils and minupicalities are charged with prodivding care – with 71% of all health expenditure funnelled through local taxation.
The assumption that universal healthcare results in government monopoly is false. There are many market-based system available to potential reforms that, in themselves, refute that crude distinction between public and private systems as reflecting broader political dichotomies between sinister Marxism and cold libertarianism. In any case, the provision healthcare will always be at the hands of clinicians, not governments, regardless of the over-arching administrative system.
The healthcare system astride the pond is no conceptual division. The system in each jurisdiction is unique. Like Hume’s billiard balls, it still interacts with those around it, but there is no sign of them moving in the same direction, let alone resting in the same pocket.
Arguments regarding healthcare are never seen through rational eyes however. President Barack Obama has tried to align the United States with the rest of the advanced democracies, by introducing some system of public healthcare. Unfortunately for him, the debate that followed has been clouded, contentious and far from evidence-based.
Similarly, European politicians, burdened with often high health and welfare costs, at a time of deficit-spending, are beginning to look at the American laissez-faire administration with some envy. Although, any considered change is condemned as non-egalitarian. Angela Merkel’s posited reforms, mild by American standards, brought thousands out onto the streets in protest.
Yet, there is some truth in some knee-jerk reactions. Britain’s National Health Service is reportedly the fifth largest employer in the world – nestling behind the Chinese People’s Liberation Army and the nationalised Indian railway system. In the US, of a population of 300 million, 47 million Americans have no medical insurance cover. A further 25 million are thought to have inadequate insurance. Moreover, it is reported that doctors’ bills accounted for 60% of US bankruptcies in 2007. Adding to the pain, in the past nine year premiums for employer-provided schemes have inflated four times faster than wages, and have now doubled in cost.
President Obama’s attempts to reform the American system has been chided by a highly activitist grass-roots movement, and received a bruising in Congress. The most controversial aspect of his plan is the so-called "public option". This seeks to establish a system of Health Insurance Exchanges that would provide government-run care for those eligible – the extent of this eligibility is still subject to political negotiation.
Further still, Mr Obama plans to cover all Americans under the "individual mandate" which individuals would be required to sign into, or face a fine. Disadvantaged citizens may be offered subsidise to assist in the payment on this insurance. The bill would increase healthcare provision to 97% of the population.
The United Kingdom, on the other hand, proudly operates a highly centralised, state-run service, in which the Government provides “cradle to the grave” assistance. For the overwhelming proportion of British subjects, the state is deeply involved in their lives.
And yet, the system is perceived as expensive and inefficient. Condemned by former Vice Presidential candidate Sarah Palin as “evil”, where the lives of patients hung in the balance before unaccountable “death panels.” This may be an exaggeration, but it is wrong to think that state involvement in providing universal healthcare, necessarily means provision of care by and through government. Indeed, although some lazily refer to the UK, when they discuss the "European system" (or communist Russia), there may be tempting alternatives on the continent.
In the German system, clinicians are encouraged, cajoled and incentivised to provide social healthcare through the insurance system. All those earning below €48,000 must subscribe to a state “statutory fund”. The statutory insurance premium is progressive in its claim on an employee’s income, and usually accounts for about 15% of her wages.
Yet, there is no government monopoly of healthcare. Of Germany’s 2,030 hospitals, 790 are publicly-owned, 820 are private not for-profits, and 420 are private for-profits.
Even the briefest walk around any German city will reveal a flourishing cottage industry in healthcare providers. Signs for single-practitioner, privately-operated clinics pepper even shopping high streets. Whereas, primary care in the UK is dominated by a combination of vast general practitioner surgeries and immense NHS hospitals.
Similarly, in France, citizens are subject to compulsory social health insurance contribution. Although private “top-ups” are available, most procedures are reimbursed by the social insurance fund, once the private doctor has performed the issued a bill.
Moreover, government involvement does not necessitate centralised administration. Sweden’s healthcare system is highly decentralised. Although the National Board of Health and Welfare (Socialstyrelsen) plays a broad regulatory and supervisory role, the local county councils and minupicalities are charged with prodivding care – with 71% of all health expenditure funnelled through local taxation.
The assumption that universal healthcare results in government monopoly is false. There are many market-based system available to potential reforms that, in themselves, refute that crude distinction between public and private systems as reflecting broader political dichotomies between sinister Marxism and cold libertarianism. In any case, the provision healthcare will always be at the hands of clinicians, not governments, regardless of the over-arching administrative system.
The healthcare system astride the pond is no conceptual division. The system in each jurisdiction is unique. Like Hume’s billiard balls, it still interacts with those around it, but there is no sign of them moving in the same direction, let alone resting in the same pocket.
Wednesday, 2 September 2009
Japanese landslide may not lead to earthquake
The sweeping victory of the Democratic Party of Japan over the Liberal Democratic Party has stunned the world.
The election of Yukio Hatoyama’s party ends 54 years of nearly LDP uninterrupted rule.
Although the victory had long been predicted by pollsters, it was the thumping mandate for reform that surprised observers.
The DPJ has increased its seats from 112 to 308 in the 480-seat lower house, coupled with its dominance of the Diet’s Upper Chamber, now can forge ahead with its new agenda unencumbered with parliamentary obstacles.
A change of government in Japan in itself is healthy sign and an expression of democratic will that it has hitherto been reluctant to realise. The LDP has shuffled through an ineffective cadre Prime Ministers, yet none were able to satisfy the public’s demand for change.
Yet, the LDP has been competent in its administration of the nation’s economy – overseeing its transformation from a war-battered, defeated people to the most developed country in the world. This success partly hinged on the “iron triangle” the close relationship between the LDP, the banks, and big-business representatives.
Japan was badly hit by the 1997 Asian Financial Crisis, and its economy has been in the Doldrums since. The inability of the establishment to find any alternative beyond the old institutions sapped national confidence from the LDP on an unprecedented level.
So now, will we see a “revolution” as the new Prime Minister suggests? It is important to note that Hatoyama is himself the grandson of a former LDP prime minister, and is a product of the old conservative institutions.
Quite how revolutionary the new administration will be is unclear. The DPJ seems to advocate a more Asia-centric foreign policy, although still wishes to retain the US as the bedrock of its defence.
There are confusing messages on dealing with public debt – which currently stands at 170% of GDP. The DPJ promised to remove some education fees, and providing a minimal guaranteed income for farmers, but has denounced media expenditures on the 2009 Budget "wasteful spending." Including the cancelling of a ¥11.7 billion Media Centre.
Japan’s economy urgently needs reform. Specifically, its public and business sectors require genuine transparency and accountability.
Currently, unless the new government develops a much needed ambitious new vision of Japan, the DPJ is in danger of finding itself as a LDP Mark II.
The election of Yukio Hatoyama’s party ends 54 years of nearly LDP uninterrupted rule.
Although the victory had long been predicted by pollsters, it was the thumping mandate for reform that surprised observers.
The DPJ has increased its seats from 112 to 308 in the 480-seat lower house, coupled with its dominance of the Diet’s Upper Chamber, now can forge ahead with its new agenda unencumbered with parliamentary obstacles.
A change of government in Japan in itself is healthy sign and an expression of democratic will that it has hitherto been reluctant to realise. The LDP has shuffled through an ineffective cadre Prime Ministers, yet none were able to satisfy the public’s demand for change.
Yet, the LDP has been competent in its administration of the nation’s economy – overseeing its transformation from a war-battered, defeated people to the most developed country in the world. This success partly hinged on the “iron triangle” the close relationship between the LDP, the banks, and big-business representatives.
Japan was badly hit by the 1997 Asian Financial Crisis, and its economy has been in the Doldrums since. The inability of the establishment to find any alternative beyond the old institutions sapped national confidence from the LDP on an unprecedented level.
So now, will we see a “revolution” as the new Prime Minister suggests? It is important to note that Hatoyama is himself the grandson of a former LDP prime minister, and is a product of the old conservative institutions.
Quite how revolutionary the new administration will be is unclear. The DPJ seems to advocate a more Asia-centric foreign policy, although still wishes to retain the US as the bedrock of its defence.
There are confusing messages on dealing with public debt – which currently stands at 170% of GDP. The DPJ promised to remove some education fees, and providing a minimal guaranteed income for farmers, but has denounced media expenditures on the 2009 Budget "wasteful spending." Including the cancelling of a ¥11.7 billion Media Centre.
Japan’s economy urgently needs reform. Specifically, its public and business sectors require genuine transparency and accountability.
Currently, unless the new government develops a much needed ambitious new vision of Japan, the DPJ is in danger of finding itself as a LDP Mark II.
Tuesday, 1 September 2009
China still a risky investment
After Rio Tinto rejected China’s Chinalco investment offer of $19.5 billion, the Chinese Government arrested four of the Anglo-Australian mining company’s executives for “stealing state secrets." Although these charges were dropped, the men still remain imprisoned.
One of the four, Stern Hu, is an Australian passport holder, and will be trialled for “bribing internal staff of Chinese steel companies" causing "huge loss to China's national economic security and interests." China alleges that the accused cost the country a total of $100 billion in over-priced raw materials over three years.
These allegations may be true and the Australian Government have not sought to defend Hu from consequences of his claimed criminality. Nevertheless, the case underlies the politicisation of Chinese life – even in the commercial sphere - and the danger this represents for investors.
China’s geo-economic strategy has attempted to wean its dependence from foreign-owned iron ore providers. Rio Tino, BHP Billiton (BHP) and Brazil's Vale (VALE) account for an estimated 70% of global iron ore sales. The future of China’s heavy industry-based economy, and its plans for continued expansion, requires a reliable source of raw materials.
China has sought to address this by a new aggressive merger and acquisition policy. China Minmetals Corp recently acquired Australian copper-gold mining company Oz Minerals Ltd for $1.39-billion. China’s Yanzhou Coal Mining Co. has also commenced proceedings to buy Australia’s Felix Resources Ltd. for $2.9 billion. Bloomberg reports that Chinese energy companies have acquired $12.6 billion worth of on overseas assets and since December 2008.
Australian-Chinese relations have also been damaged by Canberra’s refusal to block a visit from the Uighur leader, Rebiya Kadeer. Chinese official have vigorously pressed Australia not to issue the Xinjiang exile a visa. Kevin Rudd reacted just as forcefully:
“The government I lead is one where Australia makes decisions on who it issues visas to or not.“
Chinese sensibilities face further embarrassment with BHP Billiton and Rio Tinto finalising their $US116 billion deal to merge their West Australian iron ore operations. This only adds to the backlog of trade disputes, intellectual property rights and currency rows which serves to increase the pressure the business community works in during an international recession.
That China still can behave like an authoritarian dictatorship can come as a shock to a historically pro-market economy. But it is important to note that the country is still not free, and its business community still not secure from nationalistic interventions.
One of the four, Stern Hu, is an Australian passport holder, and will be trialled for “bribing internal staff of Chinese steel companies" causing "huge loss to China's national economic security and interests." China alleges that the accused cost the country a total of $100 billion in over-priced raw materials over three years.
These allegations may be true and the Australian Government have not sought to defend Hu from consequences of his claimed criminality. Nevertheless, the case underlies the politicisation of Chinese life – even in the commercial sphere - and the danger this represents for investors.
China’s geo-economic strategy has attempted to wean its dependence from foreign-owned iron ore providers. Rio Tino, BHP Billiton (BHP) and Brazil's Vale (VALE) account for an estimated 70% of global iron ore sales. The future of China’s heavy industry-based economy, and its plans for continued expansion, requires a reliable source of raw materials.
China has sought to address this by a new aggressive merger and acquisition policy. China Minmetals Corp recently acquired Australian copper-gold mining company Oz Minerals Ltd for $1.39-billion. China’s Yanzhou Coal Mining Co. has also commenced proceedings to buy Australia’s Felix Resources Ltd. for $2.9 billion. Bloomberg reports that Chinese energy companies have acquired $12.6 billion worth of on overseas assets and since December 2008.
Australian-Chinese relations have also been damaged by Canberra’s refusal to block a visit from the Uighur leader, Rebiya Kadeer. Chinese official have vigorously pressed Australia not to issue the Xinjiang exile a visa. Kevin Rudd reacted just as forcefully:
“The government I lead is one where Australia makes decisions on who it issues visas to or not.“
Chinese sensibilities face further embarrassment with BHP Billiton and Rio Tinto finalising their $US116 billion deal to merge their West Australian iron ore operations. This only adds to the backlog of trade disputes, intellectual property rights and currency rows which serves to increase the pressure the business community works in during an international recession.
That China still can behave like an authoritarian dictatorship can come as a shock to a historically pro-market economy. But it is important to note that the country is still not free, and its business community still not secure from nationalistic interventions.
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