Fleeing the enemy

Few people blog seriously on a daily basis. You simply run out of thoughts – or get diverted by life or novels. And my excuse for the silence of the past few days is that Ive been hooked on the atmosphere and characters of Olivia Manning’s The Balkan Trilogy - which covers the travails of a British Council staffer and his new wife in Bucharest in the months before the German troops arrived in 1940, their escape to Athens and the intrigues and dangers they face there too. The sense of transience and uncertainty is well caught – with Harriet and Guy Pringle embodying such different views of people and life – Guy the gullible, sociable left-winger; Harriet the romantic realist. I’d no sooner finished thatbook than I was fleeing the Bolsheviks with Lev Nussimbaum – the amazing character born in Baku in 1905 or so to a rich jewish family (with a communist mother who commited suicide)which was twice chased out of the city by uprisings. During the first communist soviet, they went east across the Caspian to what we now know as Turkmenistan and Uzbekistan and back via Iran; in 1917 when the Russians took over, the father and son escaped separately north to Georgia, then west across the Black Sea to Istanbul. From these and other fantastic pre-war experiences (reconstructed from notebooks discovered by Tom Reiss in The Orientalist - in search of a man caught between east and west), Nussenbaum wrote books under various names – mostly socio-econmomic (one about Stalin with whom he claimns to have conversed at his Baku home when young). But his most famous is his great love story Ali and Nina – which is a celebration of life in Baku before the killings and published under another of his pseudonyms, Kurban Said. Reiss’s book is quite riveting – and essential reading for anyone who wants to understand the Caucasus.

Anyway I’ve discovered one original and tireless voice amongst the bloggers to whom I can turn for both information and provocation – Boffy’s blog. He had a good post recently on one option for the current British economic problems
And also his interesting thoughts on pension funds.

Finally a booklet from the Institute of Development Studies which addresses the issue I;ve been wrestling with for some years about the inappropriateness of much instituion-building in fragile states.

If building best-practice institutions in poor countries is not a short-term option, and if relationships between private investors and public authority are likely to remain highly personalised and informal in the medium term, the question becomes in what circumstances might such relationships lead to productive investment rather than crony capitalism? That is the issue addressed by this stream of the CFS research.

a few words in favour of anarchism

The priest’s singing was echoing around the hills the last 2 days – the new priest has had a broadcasting system fitted so that we are all involved in the services. The call to worship starts with what sounds like a wooden drumbeat which quickens to merge into the peel of bells. It’s actually a long wooden instrument called a Toaca which is struck against wood. The last 2 days have apparently been celebrating The Elevation of the Venerable Cross – on Tuesday I came across my neighbour reading a bible as his wife was at church. But village ways continued – as his 2 sheep were slaughtered in his yard on Wednesday. Coincidentally this morning, Valentin Mandache’s posting was about village life here – and is worth a look.
Yesterday was busy – with the sawing removal of the branches I had cut last week which were threatening our electricity line (yes we do have electricity!); varnishing of the terrace; and erection of a lamp for the terrace. Daniela was very proud of her first piece of electrical work! We duly toasted her success with the local Palinka in the twilight.
I don’t think the word “anarchism” has yet appeared on this blog – and yet it is a strand of thinking to which I have always been drawn. And I have to recognise that my recent interest in systems thinking and my more long-standing revulsion against construction and many aspects of modernity is rooted in that approach. The villages here are fairly self-sufficient. Some other blogs have also been musing on this – first the blog which is devoted to complexity and development. Then one of my favourite blogs
And finally an article about one of the guys who first disposed me in the direction of anarachism – Ivan Illich

limits of political power

When policies, institutions or leaders fail, they are quickly replaced by others. I have often wondered about how few people pose the simple question “Why should we believe it will be any better with this?” In the 1970s, academics gave a lot of attention to policy failure and problems of implementation. Indeed it was an important intellectual strand in the breakdown of the post-war consensus allowing the rise of neo-liberalism. And the Cabinet Office of the new Labour Government of 1997 recognised that implementation issues needed as much attention as policies themselves. Those who think in linear fashion credit leaders, managers, institutions and policies with power they simply do not have. System thinkers and marxists in their very different ways recognise this. Systems thinkers would urge experimentation and decentralisation. I am less ceratin of the practical steps Marxists would suggest for our various social and economic ills.
These thoughts were sparked off by a good essay on the Open Democracy site by Jeremy Gilbert about the current Labour leadership contest which poses a basic question no one has really posed - How did Blair, the advocate of a communitarian politics,
weakly informed by the traditions of Christian socialism and Catholic social teaching, become Blair the fanatical advocate of merciless market liberalisation? And why on earth should we imagine that the next Leader will not also betray the promises of the campaign?

There is a simple answer to this question available, which is to say that in any society dominated by liberal capitalism, political opposition from either right or left will inevitably find itself having to make communitarian noises, because the lack of community is the most obvious failing of a competitive market society and one which most of its inhabitants will keenly feel. Isn’t this what ‘The Big Society’ is all about, along with ideas of ‘Red Tory’ Philip Blond?
Just as with New Labour, but in a shorter time frame, we’ve witnessed an opposition come to power speaking a language of community and fairness, only to see it bow to the demands of the financial markets and the Whitehall monetarists by promising a historic assault on the remaining institutions of social democracy.
We must then assume that the story was similar, if slower, for Blair: pressure from elites in the City, the Civil Service and the media, gradually winning him over to the cause of full-blown neoliberalism. David Miliband and Jon Cruddas would probably argue - with some justification - that Blair’s personal commitment to communitarianism had never been run very deep, and that their own is far more serious. But this is really beside the point. Whatever his personal convictions or lack of them, Blair was elected leader of the party on a prospectus almost identical to that which they now propose, but within 5 years was trying to drive a programme informed by an almost diametrically opposite set of principles; and the party was apparently powerless to stop him.

The question which this leaves open for all of the Labour leadership contenders, or their supporters is: why should we believe that their leadership will be any different? How will they react when their civil seravnts and their friends with the yachts and the hedge funds and the influential newspapers, tell them that, no matter what they might once have believed, what they have to do now is to cut taxes and privatise public services?
Will they have put in place institutions and a movement which enables them to resist such pressure better than New Labour - bereft of any real political or social base after its deliberate evisceration of the party’s democratic structures - was able to? Should we trust any of them to resist the seductive pressure to defend the interest of the elite of which they have themselves become a member? Most importantly of all: will they at least acknowledge that such pressure will inevitably be brought to bear, and will reveal genuine conflicts of interest within our society between the rich and the poor, the employers and the employees, the upper-band tax-payers and the low-paid hospital cleaners?

Right now, there are at least two possible futures implicit in the forms and symbols of modernisation which we can see all around us: an world of vicious competition, new forms of authoritarianism and a dreadful narrowing of personal and collective aspirations; a YouTube world in which the authority of centralised media and corporate capital is severely weakened by the power of decentralised democracy and collective creativity. The latter is a real possibility, immanent to the most transformatory tendencies of our age, but it will prove unrealisable without a programme of institutional and democratic transformation far more radical than anything envisaged even in the days of Labour’s halting half-conversion to the cause of constituional reformin 1992.

Of course, we know which world all of the Labour contenders would say they want to lead us to. But then the question comes back round again, almost unchanged: will they recognise that there are powerful forces which will try to stop them, to push them in the other direction, to ensure that it is only Murdoch’s version of modernity that can possibly triumph, and that ‘community’ becomes just an alibi for the decimation of public services? Will they tell us what they plan to do about it when such pressure is brought to bear? Until they do, I’m reluctant to vote for any of them

Great expectations

Romania has been in crisis for the past few months – but not quite the same as the rest of Europe. They have been in thrall to the IMF for the past year – despite many of their indices (such as public debt) being much better than almost all other EU members.
The latest 20 billion IMF loan package led in May to government proposals to cut pensions causing, in turm, serious public protests and demonstrations. The Constitutional Court, however, ruled that this was unconstitutional – perhaps not surprising given the incredible pensions the judges and other members of the political class enjoy.In one case an ex-judge is known to have a monthly pension of 8,000 euros and generals (of which Romania has an extraordinary number) can expect about 5,000 euros a month. This in a country whose average monthly wage is 150 euros. And a 25% cut in public service wages has gone through – making life even harder for teachers and others. Not surprisingly, then, there was a government reshuffle last week which got no mention in the UK press (apart, presumanbly, from the FT) and it deserved little – except that a related blog from an excellent political analysts – Sorin Ionita – helped me understand the role which political parties here in Romania play in sustaining the corruption which everyone rails against. His site referred me to an articleeleven things which Vladescu won’t tell us (in Romanian only I’m afraid) which is an attack by an esteemed Romanian financial journalaist (Soviani) on the previous Minister of Finance for his dishonesty and hypocrisy in concealing eleven sources of income he had. As Minister, he was on the Board of several state companies – and apparently received 96,000 euros a year for attending their Board meetings which he forgot to declare. For an example of the financial asset declaration forms which have recently became compulsory you can see one filed by a State Secretary in the same Ministry - Bogdan Dragoi. The only problem is that although this 30 year-old official has been working in the Ministry for more than a year, his form (dated 10 June 2009) tells us that he is working in the municipality of Bucharest! However his brief CV (on the EIB website since he was appointed in Feb 2009 to its Board) tells us that he finished the municipal job exactly one year earlier than he completed and signed his declaration - in June 2008!
His declaration form also tells us that his net annual earnings were 50,000 rons (about 1250 euros - perhaps he made a mistake and this is actually monthly?) – although he also admits to owning 25,000 sq metres of land in Bucharest and another 25,000 sq metres of land in Calarasi). Of course he is now a State Secretary - actually earning 9,600 euros a month! He obviously hasn’t been using his Rolex, Breitweiler and other 2 watches (which he values in total at 14,000 euros) and does not therefore realise that it is now mid-September 2010. Rip van Winkle rather than Midas!
Just imagine yourself in such a situation - your boss has been sacked and is being publicly pilloried for having failed to declare external earnings. The first question of a normal person would be "Is my own declaration form in order?" But no, people like Dragoi enjoy such patronage (with no experience - he became a State Secretary at the age of 26 after an extended education!)and protection and seem so contemptuous of these forms that he doesn't even bother to update his form which understates his income by a factor of 40! 250 euros he says when it is actually 9,600!
His out-of-date form does, however, declare some of the additional revenues he earned as a committee member of various state funds.
I alighted on his declaration form by accident – just choosing his file at random from the list of officials’ forms. These assets, earnings and concealments reveal systemic immorality which, in Romania’s case, seems to be shaped and sustained by the role of its political parties which grabbed significant amounts of property in 1990 and which now determine the career path of young characters like Dragoi (nationally and internationally) and take in return a significant part of his earnings. For more on this issue see Tom Gallagher's recent article.

When people talk about pinning their hopes on the younger generation, I will always think of this face. It is when these scams are revealed that I feel some shame for having spent time working trying to reform such systems.

where do we go to understand countries?

I am still musing about the apparent paucity of insightful writing about individual European countries - by English writers at any rate. But I have initially to test my hypothesis. First I have to establish a standard or (in the modern jargon) a benchmark. And am I talking about articles, books, blogs or broadcasting? Clearly we are overwhelmed with information about events all over the place – but generally in short pieces of broadcasting or articles. The article in Vanity Fair about the Greek crisis which so impressed me was 11,000 words long – and was a superb balance of technical information and quirky interviewing and analysis (of the Mount Athos monks). Where else can someone write in such length except in journals such as New York Review of Books, London Review of Books, New Left Review, New Yorker. And it is generally specialists (academics) who get through these editorial hoops – and not just any academic but those who have learned the difficult art of writing both clearly and creatively - such as the historians Timothy Garton Ash and Tony Judt. Such people are fairly rare – since communicating with the general public is not a skill which is good for one’s academic career. I am a great fan of all these journals – but have to ask also about how they decide which topics will be of interest to their readers. The mainstream media make judgements about the short time-span and limited subject matter of interest to their readers. The upmarket journals may credit their readers with more intelligence – but make equally questionable assumptions about the range of their interests. So lots of stuff about the economy and education in New York Review of Books – but little about European countries. Italy, of course, is always good for knock-about comedy.
As far as books are concerned - the need for publishing niches has created a good market for travelogues which are generally well-written but which focus on a very narrow aspect of a society –eg construction workers, the fez, carpets, And academics writing on particular countries also focus on such narrow aspects (politics, economics, history) as to leave us with no real insights.
Was there a golden age? France had Richard Cobb and, more recently, Theodor Zeldin; Spain, Gerald Brennan: the USA, Alaister Cooke; Italy, Luigi Barzini. But note - only the countries where the Brits would go on holiday.
The painting is from my collection - L Minkov's Razgrad mosque only 3 hours down the road from here in Bucharest!

Balkans basket-case

I find it astonishing that I learn more about the Greek crisis from an article in the US Vanity Fair than in any serious British journal or blog. And what a story it is.

In just the past decade the wage bill of the Greek public sector has doubled, in real terms—and that number doesn’t take into account the bribes collected by public officials. The average government job pays almost three times the average private-sector job. The national railroad has annual revenues of 100 million euros against an annual wage bill of 400 million, plus 300 million euros in other expenses. The average state railroad employee earns 65,000 euros a year. Twenty years ago a successful businessman turned minister of finance named Stefanos Manos pointed out that it would be cheaper to put all Greece’s rail passengers into taxicabs: it’s still true. “We have a railroad company which is bankrupt beyond comprehension,” Manos put it to me. “And yet there isn’t a single private company in Greece with that kind of average pay.” The Greek public-school system is the site of breathtaking inefficiency: one of the lowest-ranked systems in Europe, it nonetheless employs four times as many teachers per pupil as the highest-ranked, Finland’s. Greeks who send their children to public schools simply assume that they will need to hire private tutors to make sure they actually learn something. There are three government-owned defense companies: together they have billions of euros in debts, and mounting losses. The retirement age for Greek jobs classified as “arduous” is as early as 55 for men and 50 for women. As this is also the moment when the state begins to shovel out generous pensions, more than 600 Greek professions somehow managed to get themselves classified as arduous: hairdressers, radio announcers, waiters, musicians, and on and on and on. The Greek public health-care system spends far more on supplies than the European average—and it is not uncommon, several Greeks tell me, to see nurses and doctors leaving the job with their arms filled with paper towels and diapers and whatever else they can plunder from the supply closets.
“The Greek people never learned to pay their taxes .... because no one is ever punished. It’s like a gentleman not opening a door for a lady.”
Where waste ends and theft begins almost doesn’t matter; the one masks and thus enables the other. It’s simply assumed, for instance, that anyone who is working for the government is meant to be bribed. People who go to public health clinics assume they will need to bribe doctors to actually take care of them. Government ministers who have spent their lives in public service emerge from office able to afford multi-million-dollar mansions and two or three country homes. Oddly enough, the financiers in Greece remain more or less beyond reproach. They never ceased to be anything but sleepy old commercial bankers. Virtually alone among Europe’s bankers, they did not buy U.S. subprime-backed bonds, or leverage themselves to the hilt, or pay themselves huge sums of money. The biggest problem the banks had was that they had lent roughly 30 billion euros to the Greek government—where it was stolen or squandered. In Greece the banks didn’t sink the country. The country sank the banks.
The author interviews 2 tax inspectors who were punished for whistle-blowing – the first just took it for granted that I knew that the only Greeks who paid their taxes were the ones who could not avoid doing so—the salaried employees of corporations, who had their taxes withheld from their paychecks. The vast economy of self-employed workers—everyone from doctors to the guys who ran the kiosks that sold the International Herald Tribune—cheated (one big reason why Greece has the highest percentage of self-employed workers of any European country). “It’s become a cultural trait,” he said. “The Greek people never learned to pay their taxes. And they never did because no one is punished. No one has ever been punished. It’s a cavalier offense—like a gentleman not opening a door for a lady.” The scale of Greek tax cheating was at least as incredible as its scope: an estimated two-thirds of Greek doctors reported incomes under 12,000 euros a year—which meant, because incomes below that amount weren’t taxable, that even plastic surgeons making millions a year paid no tax at all. The problem wasn’t the law—there was a law on the books that made it a jailable offense to cheat the government out of more than 150,000 euros—but its enforcement. “If the law was enforced,” the tax collector said, “every doctor in Greece would be in jail.” I laughed, and he gave me a stare. “I am completely serious.” One reason no one is ever prosecuted—apart from the fact that prosecution would seem arbitrary, as everyone is doing it—is that the Greek courts take up to 15 years to resolve tax cases. “The one who does not want to pay, and who gets caught, just goes to court,” he says. The easiest way to cheat on one’s taxes was to insist on being paid in cash, and fail to provide a receipt for services. The easiest way to launder cash was to buy real estate. Conveniently for the black market—and alone among European countries—Greece has no working national land registry. “You have to know where the guy bought the land—the address—to trace it back to him,” says the collector. “And even then it’s all handwritten and hard to decipher.” But, I say, if some plastic surgeon takes a million in cash, buys a plot on a Greek island, and builds himself a villa, there would be other records—say, building permits. “The people who give the building permits don’t inform the Treasury,” says the tax collector. In the apparently not-so-rare cases where the tax cheat gets caught, he can simply bribe the tax collector and be done with it. There are, of course, laws against tax collectors’ accepting bribes, explained the collector, “but if you get caught, it can take seven or eight years to get prosecuted. So in practice no one bothers.” The systematic lying about one’s income had led the Greek government to rely increasingly on taxes harder to evade: real-estate and sales taxes. Real estate is taxed by formula—to take the tax collectors out of the equation—which generates a so-called “objective value” for each home. The boom in the Greek economy over the last decade caused the actual prices at which property changed hands to far outstrip the computer-driven appraisals. Given higher actual sales prices, the formula is meant to ratchet upward. The typical Greek citizen responded to the problem by not reporting the price at which the sale took place, but instead reporting a phony price—which usually happened to be the same low number at which the dated formula had appraised it. If the buyer took out a loan to buy the house, he took out a loan for the objective value and paid the difference in cash, or with a black-market loan. As a result the “objective values” grotesquely understate the actual land values. Astonishingly, it’s widely believed that all 300 members of the Greek Parliament declare the real value of their houses to be the computer-generated objective value. Or, as both the tax collector and a local real-estate agent put it to me, “every single member of the Greek Parliament is lying to evade taxes.”
The Greek state was not just corrupt but also corrupting. Once you saw how it worked you could understand a phenomenon which otherwise made no sense at all: the difficulty Greek people have saying a kind word about one another. Individual Greeks are delightful: funny, warm, smart, and good company. I left two dozen interviews saying to myself, “What great people!” They do not share the sentiment about one another: the hardest thing to do in Greece is to get one Greek to compliment another behind his back. No success of any kind is regarded without suspicion. Everyone is pretty sure everyone is cheating on his taxes, or bribing politicians, or taking bribes, or lying about the value of his real estate. And this total absence of faith in one another is self-reinforcing. The epidemic of lying and cheating and stealing makes any sort of civic life impossible; the collapse of civic life only encourages more lying, cheating, and stealing. Lacking faith in one another, they fall back on themselves and their families. The structure of the Greek economy is collectivist, but the country, in spirit, is the opposite of a collective. Its real structure is every man for himself. Into this system investors had poured hundreds of billions of dollars. And the credit boom had pushed the country over the edge, into total moral collapse.

And space does not allow me to excerpt what the author has to say about how even the Greek monks (on the Athos peninsula) were sucked into the cauldron of corruption.
There are perhaps 3 issues from such a story - one for the Greeks themselves and others in the Balkans; about how a country can be brought to its knees in such a way and how it can get off its knees. All credit to the new government and its Finance Minister that they were determined from the very beginning to be so transparent about the scale of the fiscal lying and cheating they found.
The second issue is the role of the European Union - where it was in all this in the last 2 decades. And the final issue is the poverty of foreign reporting in Britain - that it has to be an American journalist to write such an exposure. Only the academic Perry Anderson has written such insightful stuff about various European countries - in London Review of Books and New Left Review.
The painting is Bosch's The Ship of Fools,

Bucharest

Coming down to the plains for a few days requires a careful choice of books – it was the intriguing John Lane book on art and ecology; David Harvey’s The Enigma of Capital; the Amos Oz Reader; Mazower’s The Balkans; and Pearce’s When the Rivers Run Dry which made it. I have skimmed through the Lane book – which initially charmed me with its attempt to explain cultural activity with reference to the loss of community following on the humanistic spirit of the renaisance, reformation and capitalism. I am always a sucker for overarching theories (except economic!) but was disappointed to find no reference to Art Nouveau, Georg Grosz or Brecht!!
I was then amazed to find a reputable US journal actually arguing that the global financial crisis was not another market blip – but a sign of the Marxist contradiction
A strange posting in Open Democracy put me onto a powerful article by Simon Jenkins a year ago about the Saxon villages of Transylvania.
Initially I was glued to the television - Foyle's War and a black and white with Frank Sinatra and Tony Curtis fighting at the end of the 2nd WW in France. One of the many attractions of the Sirnea house is that it has no TV, fridge or washing machine. I never miss them - but have to admit that it is nice to enjoy the occasional ice cream (particularly sorbet)and access Hallmark, BBC Entertainment, TNT, MGM channels
Today I defrosted the fridge here in Bucharest (we have no washing machine here)