Nathan’s Musings

I like France. I love the food, the culture, the language. I have family there. But when it comes to French politicians, I find it difficult to understand how such a cultured, intelligent people can put up with an idiot like Jacques Chirac. OK, he got elected because most people held their noses and voted for him the last time around, since the opponent was the neo-Fascist Jean Marie Le Pen. I would have done the same. But still…

What prompts me to pick on Chirac today? A story on the radio this morning. Chirac was attending the EU summit in Brussels, when the chairman of a European business group, who happens to be French, addressed the gathering. And–quel horreur!–he chose to speak in English. When Chirac interrupted him (in French, of course) to ask why he used the language of perfidious Albion, the man sensibly replied that English is the working language of European business and indeed had also been designated as the working language of that particular meeting. Chirac’s reply? He stormed out of the meeting, taking his two ministers along with him.

The French continue to live in a happy illusion that their language is still an important world language. It is indeed spoken by many people, but unfortunately for France, mostly in places that don’t matter much to most people: parts of Africa, Haiti, places like that. Aside from Quebec, half of Switzerland, the poorer half of Belgium, Luxembourg and of course France itself, few people in rich countries speak French.

Like France, Britain is a country that has lost an empire and is a lot less powerful today (in relative terms) than it was 100 years ago. But at least the British can console themselves with the fact that their language is more influential in the world today than ever before. The French have to make do with foie gras.

I know this is a rather strong statement, but let’s face it: with the exception of a few specialised agencies such as the WHO, most of the UN apparatus is a giant talking shop which only serves to provide gainful employment to bureacrats and ex-politicians in places like New York and Geneva–at best useless, at worst directly harmful.

Today, March 21st, has been proclaimed as the International Day for Elimination of Racial Discrimination. Declarations will be issued, lots of words will be uttered, but you can be sure that all of those utterances will have absolutely no impact on the actual extent of racial discrimination around the world. The day is sponsored by that worthy body, the UN High Commission for Human Rights, whose 53 member countries include such illustrious defenders of human rights as: Azerbeijan, Bangladesh, China, Congo, Cuba, Egypt, Eritrea, Ethiopia, Nepal, Pakistan, Qatar, Saudi Arabia, Sudan (!) and Zimbabwe, among others. Enough said…

On the occasion of the anti-racism day, the UN has produced a poster with the tag line “Racism takes many forms” and a most curious choice of symbols: a puzzle and a Lego brick. Is the choice of the Lego brick a coincidence, or did the UN wish to make a point about the oppressive Danish racist regime? One can only speculate; but last week, the UN’s special rapporteur on racism, Doudou Diene from Senegal, strongly criticised the Danish government in his report to the UN Human Rights Commission, claiming that the government had broken its international obligations by not condemning the Muhammed-drawings and by refusing to meet with Arab ambassadors back in October. So, presumably the good Mr. Diene wanted the Danish government to violate a basic human right, freedom of speech, in order to soothe the tender feelings of insulted Muslims.

Any organisation that spews out such nonsense simply does not deserve to exist. At the very least, it does not deserve a penny of taxpayer’s money, most of which comes from liberal democracies like Denmark.

A few days ago I wrote critically of the French and Italian attempts to protect their companies from being acquired by foreigners, even if that meant contravening the EU rules on free movement of capital. Like most economists, I tend to take the strictly liberal line on this kind of issue.

However, this does not mean that state intervention is never justified. Yesterday, the US House Appropriations Committee voted 62-2 to block the proposed takeover of operations at six US ports by the Dubai Ports World. I wholeheartedly support this decision and hope that the US Congress as a whole will pass this legislation by a veto-proof margin.

A storm of protest has arisen. US politicians are being depicted as populist nationalists who play on the dislike of Arabs and Muslims following the September 11 attacks. And I am sure that this is part of their motivation. But there is a perfectly good reason why the US should not allow parts of its vital infrastructure to be acquired by Dubai Ports World. The critics of the Congress say that the legislators had no problems with the ports’ previous owner, UK-based P&O, so why the fuss now? For two reasons: first, P&O was a private company, while Dubai Ports World is owned by the UAE government; second, it does make a difference whether the foreign entity is from the UK, the closest friend of the US and a trusted ally, or from UAE, which, although proclaimed an ally by George Bush, is part of a region which is fundamentally hostile to the US and other Western democracies and which provides finance for terrorist activities around the world. So yes, let us be honest: a US port owned by a private UK company is not the same as the same port owned by a state-owned Arab company. The fact that the UK government does not see it that way and has allowed the takeover of P&O by Dubai Ports World to go through is sad but does not mean that American opponents of the proposed takeover are wrong.

In the first half of 2004 I was working in Spain. Every Monday morning I would fly to Madrid or Malaga, and take a train from there to Seville where my office was located, to return home Wednesday night.

On 11th March 2004 I was not in Spain, having had to stay in the Netherlands that week. But two of my friends and colleagues in Seville had a meeting in Madrid that day. Miguel and Pedro took an early morning high-speed train from Seville to Madrid. After about 1 hour they called me from the train to say that there had been some sort of explosion in Madrid and that their train had been halted midway between Seville and Madrid, the passengers told that the train would go no further, and otherwise left to their own devices. My two friends rented a car and drove the 300 km back to Seville.

As that terrible day wore on, we all became aware of what had happened in Madrid that morning. I was so happy that my friends had chosen the particular train they were on and not the earlier one they had originally planned…

The Spanish conservative government of José Maria Aznar immediately pointed the assusing finger at the Basque separatist group ETA. I remember my own initial doubts from the very beginning; while ETA was clearly a terrorist organisation that had killed 800 people during its 30 years of “armed struggle”, the attack on commuter trains was simply not their style. ETA had always concentrated on targets that were in some way connected to what they saw as the oppressor from Madrid, be they politicians, police, military or judges. They did not have the habit of killing large numbers of civilians.

During the following couple of days it became clear that the Spanish government had lied to its people; they knew full well that the attack on Atocha was the work of Islamist terrorists, inspired by Spain’s engagement in Iraq. The people of Spain did not like being lied to, and in the general election later that week they threw Aznar’s Partido Popular out of office. The new Socialist Prime Minister Zapatero promptly withdrew Spain’s soldiers from Iraq, something he had been promising all along during the election campaign. In my view the timing of the withdrawal was unfortunate, as it essentially rewarded the terrorists, but in fairness to Zapatero, he was simply keeping an election promise made months earlier. Subsequently, he has proceeded to implement many good reforms, including some that finally are relaxing the grip of the Catholic Church on Spanish society, in areas such as education, homosexual rights and other social issues.

Back to Atocha: a week after the bombings, on 18th March, I flew to Madrid and took the high-speed train to Seville from Atocha station. As I walked through the enormous building, it was chilling to think about the casualties that would have resulted if the terrorists had timed the explosions to occur while the train was inside the station–as they undoubtedly intended. As it is, 191 were killed and 1800 wounded; but if the train had exploded inside Atocha station, those numbers would have been vastly higher.

This is what Atocha looked like a week after the bombings. The grief and anger of the Madrilenos was palpable, and they expressed it by turning part of the station concourse into one huge memorial:

Back in the 1990s the US had a president who was reasonably successful politically and was duly re-elected for a second term. He had his flaws, of course, but by and large the American people were quite happy with his performance in office. But the opposition party was not happy at all. Especially the zealots among them were always on the lookout for something that could be used as a weapon with which to attack the president. And one day they found it…in the form of a stained dress. It turned out that the president had a weakness for chubby female interns and a somewhat creative definition of what constituted a sexual act. To put it plainly: he had one or more unauthorised blow jobs on the side and subsequently lied about it.

Now, cheating on your spouse is wrong and immoral, but not illegal. People usually lie about it for obvious reasons. So when the Republicans in Congress wanted to impeach Bill Clinton over the Monica Lewinsky affair, it was nothing more that a desperate ploy by desperate right-wingers.

Now, in the 2000s we have another president, a Republican this time. He has lied to the country and the world about Iraq and started a needless war that has so har claimed more than 2000 American lives, more than 100 British lives, and countless Iraqi civilians. He has led the most corrupt administration in several decades. Most recently, it has been revealed that he flatly lied when he claimed that he did not know how fierce Hurricane Kathrina would be. The truth is that he did not give a shit about New Orleans because it was mainly populated by poor black people who voted Democrat anyway.

So, which of these two presidents deserves to be impeached?

An interesting case of economic nationalism is currently in the news. The Italian energy company Enel announced last week its intention to make a bid for the French company Suez. The French government, which tends to disapprove of foreign takeovers of big French companies, promptly announced its intention merge Suez with Gaz de France, another large French firm in which the government owns a controlling stake. We are talking big money here: the combined Suez/Gaz de France entity would be an energy giant with annual turnover of 72 billion Euro, second only to Electricite de France (EDF) on the French market. Incidentally, in the best dirigiste tradition, EDF is also controlled by the government.

The purpose of the proposed merger of the two French companies is to prevent the Italians from buying Suez. Of course, the Italians are not happy, and Berlusconi and his gang have been making loud complaints about how France is not playing by the rules of EU’s internal market which is supposed to guarantee free movement of capital across borders.

What delicious irony to see France and Italy fighting about who is playing by the rules of the internal market! It is like two drug dealers invoking righteous principles in a disagreement about a street corner. The truth is that both France and Italy are among the worst sinners when it comes to state meddling in the economy. Just last year, the Italian government used so many dirty tricks to try to prevent a takeover of an Italian bank by ABN-Amro of the Netherlands that both the finance minister and the head of Italy’s central bank ended up resigning over the affair.

There is a clear division within Europe between a group of countries which by and large let the market take care of itself and those–like France or Italy or Spain–which stick to outdated notions of “national champions”. The first group includes mainly the UK, Denmark and the Netherlands, plus some of the new EU members such as Estonia. In these countries a deal is evaluated on its merit and the state largely stands back. Ironically, the large companies from the dirigiste countries have taken advantage of this by making large acquisitions in the free-market countries. So, for example, the former Dutch flag airline KLM is now owned by Air France (unfortunately this has not led to any improvement in the food served on KLM flights…); the state-owned EDF supplies electricity to many customers in the UK; and it is highly likely that within the next year or two both the Dutch and the Danish dominant telecoms operators (KPN and TeleDanmark, respectively) will end up as subsidiaries of foreign companies. The governments in those countries assume, correctly, that as long as consumers do not suffer and no anti-competition rules are broken, the national identity of the owner of a company doesn’t matter.

As a final thought, it might be worth noting that the economies of the Northern European, free-market countries have performed much better for several years than those of their meddling, dirigiste Southern neighbours. If I were a French or Italian tax payer, I would be asking some serious questions of my politicians. Of course, Italian tax payers don’t ask questions, they just evade taxes instead…a sensible course of action given the quality of their political system.

A must read: the novelist Salman Rushdie and eleven other European intellectuals, mostly of Muslim origins, have published a manifesto in defense of freedom of speech and secular values. Here it is, reprinted (in English) in the now world-famous Jyllands-Posten newspaper.