Why a growing number of descendants of Holocaust victims are seeking EU citizenship

By Katie Engelhart - Wednesday, May 1, 2013 at 10:30 AM - 0 Comments

Frederic Lewis/Getty Images

About a year ago, Alex Yale became the citizen “of a country I’ve never been to, where people speak a language that I don’t understand.” To Yale—a 25-year-old management consultant from Connecticut—Austria seemed a faraway land indeed. His Jewish grandparents were born and raised in Vienna, but fled shortly before the Anschluss (Germany’s 1938 annexation of Austria). They eventually made their way to the United States, after stints in Cyprus and what is now Tanzania. Once settled, they tried their best not to look back; their children followed suit.

But Yale is one of a growing number of North American descendants—children and grandchildren of Jewish Holocaust victims—who have recently obtained European citizenship through programs that undo wartime and postwar denaturalizations. Germany receives many of the North American applications (717 in 2012, up from 128 a decade ago), along with its Eastern European neighbours.

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The cautionary tale of the EU carbon market

By Aaron Wherry - Thursday, April 18, 2013 at 12:05 PM - 0 Comments

The European Union’s carbon market is in shambles. Bryan Walsh considers what went wrong and what it means.

Backloading failed because even in very green Europe, economic concerns seemed to trump environmental ones. European Parliamentary members worried that any action that would cause the price of carbon to rise would add to European industry’s already high energy costs. Europe, unlike the U.S., doesn’t have relatively cheap, relatively clean natural gas to help cushion that blow. At the same time, European nations like Germany are rethinking some of their renewable energy policies, concerned by the rising cost of electricity. It looks like a textbook example of what Roger Pielke Jr. calls the “iron law of climate policy“: when climate policy starts to hurt economically, even the greenest states start to back away.

It’s possible that backloading may get a second chance before the European Parliament, and even without a viable carbon market, Europe is still the global leader in climate action. Nor is the ETS the only game in town. California launched its own cap-and-trade system this year—though that’s come under political pressure as well—and Australia has introduced a price on carbon. China may do so as well. But the hope that we may be able to reduce carbon emissions the same way we cut pollutants like sulfur dioxide and nitrous oxide—through a well-run cap-and-trade —seems to be dimming, a victim of its own complexity and a sluggish global economy. That might leave the door open for other policies, including a straight carbon tax, more support for renewables or increases R&D funding for carbon-free power. We could use all three, but carbon markets may be finished. If carbon trading can’t make it in Europe, it can’t make it anywhere.

China is apparently undeterred.

The developments in Europe might be interpreted in one of two ways: either it is evidence that carbon markets won’t work or it puts the onus on those who propose carbon markets to explain how their proposal accounts for the shortcomings of the European system.

There is, it seems to me, another looming issue, another one which the NDP will have to account for. Let’s say that, by 2015, British Columbia has expanded its carbon tax (as the BC NDP currently proposes), Alberta has increased its carbon tax (as the Progressive Conservative government there seems to be considering), Quebec has a cap-and-trade system linked with California (as both jurisdictions are moving towards) and, say, one other province has implemented a carbon-pricing mechanism of some kind (Manitoba? Ontario? Newfoundland?). How then does the NDP reconcile its proposal for a national cap-and-trade system with all of that? What do the Liberals—Mr. Trudeau having offered vague support for a price on carbon—propose? Do we end up with a number of different approaches—carbon taxes, carbon markets and regulatory regimes—functioning within the country? Does that make sense? Is it feasible or political possible to build a national carbon-pricing mechanism, or at least a national approach that takes into account provincial jurisdiction?

Jean Charest thinks the country is headed towards a carbon tax. Somewhere Stephane Dion is either nodding grimly or screaming.

Update 4:19pm. Further to this post, I sent along a question to the NDP side: How would an NDP government reconcile a national cap-and-trade system with provincial jurisdictions that already have carbon-pricing mechanisms? The response from Thomas Mulcair’s office is as follows.

We will deal with this as we’ll deal with every other issues of shared responsibility: by cooperation.

I’ve asked a few smart people if they have any thoughts on the way forward and hope to post those in the next while.

EU officials agree to cap bankers’ bonuses at annual base salary

By The Associated Press - Wednesday, February 27, 2013 at 9:25 PM - 0 Comments

BRUSSELS – Top European Union officials late Wednesday struck an agreement on a package of financial laws that includes capping bankers’ bonus payments at a maximum of one year’s base salary.

The bonuses will only be allowed to reach twice the annual fixed salary if a large majority of a bank’s shareholders agrees, said Othmar Karas, the European Parliament’s chief negotiator.

“This overhaul of EU banking rules will make sure that banks in the future have enough capital, both in terms of quality and quantity, to withstand shocks. This will ensure that taxpayers across Europe are protected into the future,” said Ireland’s Finance Minister Michael Noonan, who led the negotiations for 27 governments.

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Will U.S.-EU trade talks put Canada on the backburner?

By Julian Beltrame, The Canadian Press - Wednesday, February 13, 2013 at 5:49 PM - 0 Comments

OTTAWA – Officials on both sides of the Atlantic insisted Wednesday that the Canada-European trade negotiations remain on track and are close to resolution despite concerns the entry of the United States could put the four-year-old talks on the backburner.

On Wednesday, the European Union and the U.S. announced they would pursue the world’s largest and most comprehensive trade agreement, dwarfing NAFTA in terms of both the size of the markets and trade volumes.

Trade analysts said the announcement introduces a wildcard in the Canadian-EU talks that have already missed several deadlines, the latest for the end of 2012.

“I think if we don’t conclude this agreement fairly quickly there will be a sense of drift and the Europeans will start looking elsewhere, in particular the U.S.,” says Lawrence Herman, a trade expert with Cassels Brock.

The precedent that comes to mind is Canada’s protracted and ultimately unsuccessful negotiations with South Korea, which were hung up by stern and unyielding opposition from Ontario and the auto industry, analysts say. While Canada started the process, the U.S. was able to mop up the agreement, including on trade in autos.

Veteran trade negotiator and consultant Peter Clark says the Europeans will be trying to use the announcement as leverage to get Canada to offer greater concessions.

“They are going to get the Harper government to conclude a deal basically on the state of play on terms that are not necessarily that great for Canada,” he said. “They are bigger than we are.”

He added the Europeans are also pleading a lack of staff, which could be stretched once the U.S. enters the picture, likely in June.

But a Canadian government official insists the announcement changes little, saying negotiations are at too advanced a stage.

“We’re down to a basket full of issues being addressed politically, so this doesn’t change anything,” the official. “There’s no worries here the EU is going to focus on the bigger fish down south because the bigger fish down south is waiting to see what the northern pike gets.”

In a news conference from Brussels, EU Trade commissioner Karel De Gucht said reaching a good deal was better than a quick one.

“I’m confident we can reach an agreement in the coming weeks but there are a number of issues that are not ready,” he said.

Although the negotiations have been carried on behind closes doors, trade experts monitoring the talks say there are only a few key issues remaining to be resolved. But they are the most politically difficult.

Canada is looking for greater access for its beef and pork producers, while Europe wants Ottawa to reduce tariffs and increase quotas for shipments of dairy products, particularly cheese. Europe is demanding Ottawa extend patent protection for brand-name pharmaceuticals, a measure that is estimated to wind up costing provincial drug plans and Canadians about $900 million annually once implemented.

And both sides are having difficulty with the issue of government procurement. More than 40 Canadian municipalities have asked out of a deal if it means ending local preferences on municipal bids, while economically troubled southern European countries also want to keep giving a leg up to their local firms.

The concern among trade analysts is that given the volumes involved, Europe will lose interest in Canada once the U.S. negotiations start in earnest.

The Canadian market represents about two per cent of European exports, whereas the EU-U.S. trade relationship is already the world’s biggest at about $1 trillion annually in goods and services trade.

Matthew Kronby of Bennett Jones, who was the federal government’s chief trade lawyer until last July, said the entry of the United States into the dynamic does pose a risk for Canada, but also some advantages.

There is plenty of skepticism in the U.S. about whether Europe is up to making the compromises that will be necessary for a modern trade deal, he said, so concluding one with Canada will be advantageous for Brussels.

“I think this could be helpful for Canada because the EU is facing pressure to conclude before beginning negotiations in earnest with the U.S.,” he said.

On one specific issue — “geographical indications” whereby products from certain regions can claim exclusive naming rights, such as champagne — it would be useful for Europe to show Washington it can be practical, he said.

As well, rules of origin may not be as much of a sticking point for Europe if it can conclude a deal with both Canada and the U.S., given the production integration between the two countries.

Ottawa trade consultant Laura Dawson of Dawson Strategic said Canadians shouldn’t be surprised that the end game of the Canada-EU talks is “long and slow” given the nature of the complex nature of the agreement being sought. Called the Comprehensive Economic and Trade Agreement, the deal would go beyond eliminating barriers to the trade in goods to all economic arrangement, including professional services and investment.

The entry of the U.S. into the dynamic likely doesn’t help, she says, but the process may be too far along to stop.

“I’m glad it’s coming now and not earlier because in some of our other negotiations, Canada has been used as a kind of practice round before the country engaged seriously with the United States,” she said, citing South Korea and Central America.

“I think if the U.S. and EU had agreed to move together sooner, I think that would have taken a lot of the wind out of the sails for Canada. But at this stage, I think there is enough momentum to finish it.”

Eurozone finance ministers to elect new chairman, won’t decide on Cyprus bailout before March

By The Associated Press - Monday, January 21, 2013 at 11:10 AM - 0 Comments

BRUSSELS – The Dutch finance minister was poised on Monday to take over as head of the Eurogroup, the gatherings of the 17 eurozone finance ministers, which would give him one of the top jobs in the currency bloc’s battle to end its financial crisis.

Jeroen Dijsselbloem, 46, appeared to have wide backing ahead of a finance ministers’ meeting in Brussels, where the appointment was due to be announced.

Dijsselbloem (DIE-sell-bloom) served in Dutch parliament as a member of the centre-left Labor party for most of the past decade and only became finance minister in November. His candidacy came as a surprise because of his relative lack of experience, but he emerged as the compromise candidate between Europe’s main political groups and between the economically stronger and weaker nations.

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Now is the time to mount a European army, leaders conclude

By Katie Engelhart - Tuesday, January 15, 2013 at 9:57 AM - 0 Comments

Marcel van den Bergh/Hollandse Hoogte/Redux

Later this year, the leaders of European Union nations will meet in Brussels for their annual European council. On the agenda: a discussion of Europe’s military might. At the summit, it’s likely that two equally bold visions for European defence will be put forward. One would see the union’s 27 member states pool military resources as never before—with an eye to eventually building a bona fide EU army. The other would see the union member with the strongest military, Britain, withdraw from the EU—leaving the Continent sputtering.

In London, it is talk of a potential pullout from the EU that dominates. But elsewhere, calls for a pan-European military are growing—with France and Germany leading the charge. In September, a group of EU foreign ministers spelled it out directly, weighing, in a controversial report, the possibility of a European army.

How exactly that army would function has yet to be decided—or even sketched out in much detail. In the event of another Iraq war, would the EU commit troops as a block? In the case of a major terrorist attack in Paris, would EU troops be called in? What seems unlikely is the prospect of EU leaders disbanding their own militaries. For that reason, a viable EU army would have to accommodate coexisting national forces—and leave room for individual opt-outs. But the question is: should the balance between national and continental defence be shifted? And how far? Last fall, EU defence ministers agreed to develop what sounds an awful lot like a kindergarten rulebook: a voluntary code of conduct on pooling and sharing. Continue…

EU fisheries chief sees ‘healthy’ level of fishing by 2017

By The Associated Press - Thursday, December 20, 2012 at 5:56 AM - 0 Comments

BRUSSELS – European Union fisheries leaders say they are moving towards more efficient and sustainable fishing that should see the stocks of threatened species recover while securing the livelihood of fishermen.

EU fisheries chief Maria Damanaki said Thursday, at the end of three days of negotiations, that “a healthy level for almost all stocks” can be achieved by 2015, with four others reaching that target only four years later.

At the end of a marathon all-night negotiating session, fishing nations like France and Britain were happy their fishermen were given enough leeway for profitable fishing. Environmentalists complained several member states still sought too much short-term gain for their industry but said that after decades of slumping stocks due to overfishing there were finally signs for a turnaround in EU policy.

The danger of a Greek exit and why it matters to Canada

By Erica Alini - Thursday, November 22, 2012 at 2:57 PM - 0 Comments

of Photos

The Commons: Not enough time to explain, so don’t bother trying

By Aaron Wherry - Monday, October 15, 2012 at 5:25 PM - 0 Comments

The Scene. Conservative MP Dan Albas, still new to this place and apparently not yet exhausted of all ideals, lamented last week that the 35 seconds allotted for each response in Question Period were not nearly sufficient to explain the obviously complicated matters of national governance. “While it is possible to ask a meaningful question in 35 seconds,” he explained, “I am certain most would agree that when it comes to governance, very few answers can be given in such a short timeframe.”

Perhaps this explains why the Harper government has spent tens of millions in public funds on television advertisements to explain itself to the public. Perhaps that’s why Diane Finley, questioned repeatedly in the House about a flaw in her reforms to employment insurance, decided to announce a change in her plans via news release on the Friday afternoon before the House went on break for a week.

For sure, difficult questions are not easily answered. Witness Gerry Ritz, who, for another day, was asked not only to explain why the nation’s food safety system hadn’t prevented 15 people from getting sick, but also if he would just go ahead and resign. Continue…

Creditors ask Greece to introduce six-day work week

By macleans.ca - Wednesday, September 5, 2012 at 10:17 AM - 0 Comments

Eurozone lenders are demanding that the Greek government introduce a six-day work week in return for a second bailout, the Guardian reports.

This is one of many stiff terms found in a leaked letter from the three eurozone creditors—the European commission, European Central Bank, and International Monetary Fund. Officials are sharply policing Greece’s compliance with the terms for austerity introduced in return for the bailout, and are demanding Greece make work hours more “flexible” by introducing a six-day work week, lowering the minimum required “rest hours” to only 11 hours a day, and eliminating a mandatory midday break.

In Berlin and Brussels, there is strong evidence to show that EU leaders believe the Greek government has fallen behind in the economic reforms imposed on the country in return for two bailouts in the past two years.

Greek Prime Minister Antonis Samaras is asking for four years to fulfill debt reduction targets and spending cuts. EU creditors are asking for targets to be reached in two years.

There is strong speculation in Berlin and Brussels that Greece may be forced to exit the eurozone, but likely not until U.S. elections have wrapped up in November.

A compulsory happiness survey?

By Lyndsie Bourgon - Thursday, August 16, 2012 at 2:37 PM - 0 Comments

Oli Scarff/Getty Images

Even in the best of times, Britons’ feelings for the European Union were lukewarm at most. In the worst of times — and things are looking remarkably bleak on both side of the English Channel – the treaty-sanctioned ties that link Britain to Brussels, it seems, are beginning to feel like a straight jacket.

And as in many strained relationships, even the little things can set off a scene. That’s what just happened last week. The most recent outburst of British frustration at the ways of the Continent wasn’t about Greece’s fiscal profligacy or Germany’s inertia. It was about a piece of labour legislation in Brussels.

“New EU employment ruling could stifle British business” warned the Telegraph last week about a new proposal that would require businesses to measure employee happiness before and after a layoff. The rules, drafted by Spanish MEP Alejandro Cercas, would make it mandatory for workplaces across the Union to assess mental health after redundancy. The results of such tests would then be used to determine if an employer should provide retraining, interview coaching and general job-seeking counsel to former employees.

Never mind that the directive is still moving through the legislative process and may never see the light of day, British businesses are up in arms. The idea is “burdensome” and “ridiculous,” a rep for manufacturers’ organization EEF told the Telegraph. It is “the last thing the British economy needs,” Tory MP David Nuttall echoed on the Daily Mail.

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‘What does Canada get in exchange for this lost credibility?’

By Aaron Wherry - Tuesday, June 12, 2012 at 8:00 AM - 0 Comments

Scott Clark dissects the Harper government’s loud refusal to be part of an IMF initiative to backstop Europe.

By refusing to join the G-20 initiative to augment IMF resources, Canada’s credibility in the G-20 will be seriously diminished. Canada has been able to “punch above its economic weight” in international organizations and institutions because of the quality of its advice and the seriousness of it commitments to international institutions. Other members of the G-20 will see Canada’s refusal to participate as a weakening in its commitment to the G-20 and the IMF.

Another reason given for not contributing to the G-20 Fund is that this would require the use of taxpayers’ money. Presumably what the government is saying is that at a time when government spending is being cut it would be inappropriate to “give” taxpayers money to the IMF to help wealthy European countries. This is completely misleading. Funds are not given to the IMF; funds are lent to the IMF. More importantly the funds that would be lent to the IMF would not come from Canadian taxpayers. The funds would come from foreign exchange reserves held at the Bank of Canada. As of May 23, 2012 Canada had foreign exchange reserves of $68.7 billion … Were Canada to contribute to the G-20 fund the “contribution” would involve a transfer of SDRs from the exchange reserves to the IMF in exchange for a commitment that the funds would be repaid. There would be no use of taxpayers’ money and there would be no budgetary impact.

In April, Mark Carney appeared before the House finance committee and Peggy Nash asked the bank governor about Europe and the potential impact on Canada. She then asked Mr. Carney for the pros and cons of contributing to the IMF firewall. Continue…

Shell CEO Peter Voser takes questions

By John Geddes - Tuesday, June 12, 2012 at 5:00 AM - 0 Comments

Photograph by Blair Gable

Peter Voser is chief executive officer of Royal Dutch Shell, one of the world’s biggest companies. Shell’s multi-billion-dollar investment in Alberta’s oil sands, along with its new joint venture to build a liquefied natural gas export facility in Kitimat, B.C., make the Swiss-born executive a particularly influential player for Canada’s energy sector these days. On a recent visit to Canada, Voser discussed energy and environmental matters, along with the state of the European economy and doing business with China.

Q: Last year’s decision by President Barack Obama’s administration to delay approval of the Keystone Pipeline, which is meant to link Alberta’s oil sands with Texas refineries, dramatically raised the profile of the environmental clash over the oil sands. How do you see that debate evolving?

A: Maybe it’s best to start by looking at what energy levels the world will need over the next 30 to 40 years. Demand will double. It is our assumption that all energy forms need to be developed in a sustainable, affordable way. We see oil sands as part of that mix on a worldwide basis. Therefore, it will be developed. It’s a legitimate challenge to government, and to industries, to do this in a sustainable way. If I compare oil sands today to 20 years ago, this is an industry that has made tremendous progress. That needs to be communicated in the right way.

Q: Is it possible to win over public opinion when aerial photographs of the massive mining and tailings operations around the oil sands look so ugly to so many people?

A: These are open-mining operations and therefore you have a temporary impact on the land. Reclamation of land is part of the sustainable operation of oil sands. Within the lifetime of the mine, we give the land back in a sustainable and acceptable form.

Q: After BP’s blowout in the Gulf of Mexico in 2010, public concern about offshore activity also spiked. Your company is planning to drill this summer in Alaskan waters, and Canada is contemplating Arctic drilling. What do you say to critics who contend it’s just too dangerous in such a fragile environment?

A: First, the comparison. The Gulf of Mexico is deep water and in many parts high pressure; Alaska is shallow water and low pressure. It’s a different risk profile. I think responsible operators like us have learned [from the Gulf of Mexico blowout] to further improve prevention and containment. On the prevention part, I think we have gone further than anywhere else in the world in Alaska with our safety systems, like double-blowout preventers and various other safety and security systems built in. And let’s be very clear what exploration means—drilling wells, and we’re looking at 10 in two years. These wells will be capped afterwards, and we’ll take the information we’ve gained to prepare development plans for the longer term.

Q: But opponents of developing Arctic offshore reserves say a spill in icebound waters would be impossible to contain and clean up.

A: We have tested and put a lot of money into scientific analysis on how to deal with oil spills below ice. I think today we are of the opinion that we can deal with it. That’s not necessary in the exploration phase, because we will only drill in ice-free periods. It’s a challenging environment, a challenging process. But as an industry, and also as a company, we’ve spent significant money developing technical solutions to that. These solutions over the years will improve.

Q: Canada’s federal government is pushing to streamline the approval process for energy and other resource projects. In the past, have Canadian regulatory reviews been a problem for companies like yours?

A: Canada is really going in the right direction. Let me be very clear: from Shell’s perspective, an efficient, effective, time-bound regulatory process doesn’t mean we are not going to be as thorough and as detailed as you would expect a very advanced country like Canada to be in terms of environmental impacts. What we want is certain boundary conditions so we don’t have to wait five, six, seven, eight years.

Q: Shell’s new liquefied natural gas joint venture in B.C. has PetroChina, which is owned by the Chinese government, as one of several partners. What’s it like doing major deals with China’s state capitalists?

A: I would not call them state capitalists. These are normal companies. They are keen to learn how modern companies operate and are governed. I think you would be surprised how open they are to changes. They are fast learners. There is clearly an overall steering mechanism by the state. Many times I compare it to the Western world, and I have to say: when you get a decision in China, the decision is firm and you can work with it. You might not always get that in the West.

Q: Speaking of the West, how do you assess the European Union’s prolonged crisis? Is the EU going to come apart at the seams?

A: I don’t think so. Common sense will prevail. It needs decisive actions, no doubt, but it will take time. Anybody who thinks this will be solved in the next six to 12 months I think will be proved wrong. I think the common EU market has to be defended. This is key to European competitiveness. They need to stabilize Greece, Italy, Spain. Once they have stabilization, they can move forward.

Q: Does stabilization ultimately mean scaling back the size of government in various countries, shrinking public programs many Europeans hold dear?

A: The EU has really no way around a major social contract adjustment. They need to go through this. It will come in stages. In order to preserve the living standards you have on average in Europe, if you want to stay anywhere close to that, you will need to adjust a few things on the labour policies, you need to start to deal with pensions, you need to deal with retirement age, average number of hours you work a week. That reform is coming and it will have to happen in order to preserve the competitiveness of European business. Otherwise I think we will be left behind.

Q: You’ve recently weathered a minor shareholder revolt over executive pay at Royal Dutch Shell. [Voser’s salary and bonus compensation totalled more than $15 million last year.] Why not pay yourself less and avoid the criticism?

A: Normally I don’t talk about remuneration. My salary is set by someone else. I’ve got a chairman and a board who are setting a competitive salary package, which has been approved by the shareholders. When you’re successful and these packages pay out, I find it rather disturbing that then we have a conversation about the package itself. When you are not successful, I fully agree that you should not earn your high salary.

Q: Your pay is linked to Shell’s performance.

A: In the last three years we outperformed all of our competitors. We had a 70 per cent share price increase. What I’m trying to say is it’s market-based, it’s performance-based, it’s variable-based. That’s the right form of setting incentives.

Q: What about the underlying debate about growing income disparity in so many countries?

A: Now we are really going into the philosophical discussion. I’m a market person, so for me performance is the absolute key. For our employees, they all have a market-based salary. The CEO is no different. When you grow up in Shell and you become CEO, your package in its components doesn’t change. The absolute magnitude does change, but it’s exactly the same system. That’s a key component for me.

Q: To get back to the oil sands, isn’t the toughest problem, when you consider climate change, that producing a barrel of oil from the oil sands generates more greenhouse gas emissions than producing a barrel of conventional oil?

A: Today we’re looking at oil sands [emissions] being five to 15 per cent higher than a conventional crude cocktail. The operations Shell has are at the lower end of that range. With carbon capture and storage [CCS], you can further lower that. With CCS, you don’t get it to zero per cent difference, but pretty close to it.

Q: You’re referring to injecting carbon dioxide underground rather than releasing it into the atmosphere. But at least one CCS project in Alberta has been cancelled recently as too costly. Does the concept remain economically viable?

A: Let’s lift it up to the global scale. If you want to achieve certain climate change goals, CCS has to be part of that solution. Therefore I think it’s up to industry and governments to make this happen. You need the right frameworks. You need a carbon price mechanism. You need incentives to get these projects started, to scale up the technologies. At Shell we have decided to work on and implement various CCS projects, and we don’t wait for government frameworks, global CO2 pricing mechanisms. In our opinion they will come in the longer term, but it’s about taking actions now rather than waiting for political decisions.

Q: You’ve been studying a possible CCS project in Alberta. When will you make a decision on whether to proceed with that?

A: Our project is called Quest. If everything goes normally, you can expect an investment decision on it in 2012. It would sequester a million tonnes [of CO2] in our oil sands operations. I think this is extremely crucial for the oil sands business model.

Despite it all, most Greeks want to keep euro as currency

By Gabriela Perdomo - Tuesday, May 1, 2012 at 10:11 AM - 0 Comments

Greeks will head to the polls in a snap election this Sunday amidst the hardest economic crisis in a generation.

Voters are bitter and frustrated, having been subjected to continental humiliation in the form of severe cuts and austerity measures. But over 75 per cent of Greeks remain supportive of keeping the euro as their currency, The Guardian reports.

Evangelos Venizelos, former Greek finance minister and current leader of the socialist Pasok party, spoke to the British newspaper about the possibility that Greece would have to abandon the euro.

From the interview:

“The Greek people will have to give a clear answer as to whether it wants [to follow] a pro-European course, which is safe and responsible, or something else.”

(…)

“There are certain misconceptions that worry me: for instance, the misconception that whatever happens we are not going to leave the euro.”

(…)

“Europe and the eurozone have no reason, rationally, to push Greece out of the euro. But this is a system in which many parties, many countries, many governments, many electorates participate and we could have events which, rationally, are not controllable.”

Cyprus cozies up to Russia

By Jen Cutts - Tuesday, February 14, 2012 at 10:10 AM - 0 Comments

Andreas Lazarou/AFP/Getty Images

A Russian ship’s clandestine cargo has made plain the country’s cosy relationship with Cyprus, says the U.K.’s Guardian. The MS Chariot was carrying 60 tonnes of ammunition bound for Syria when it made an unplanned stop at the Cypriot port of Limassol. Cyprus, a member of the European Union, should have held up the ship; the EU has banned arms sales to the Syrian regime, to hamstring its brutal backlash to its citizens’ calls for change (Russia is unwavering in its support of Syria, a key ally). Instead, Cypriot officials skipped inspections and allowed the Chariot to refuel and set sail, after its captain gave his word he would alter his course and head for Turkey. The ship then fell off radar screens. It docked in Syria on Jan. 12.

It’s all evidence of Cyprus’s “embarrassing subservience” to Russia, says an anonymous columnist in the Cyprus Mail. The Guardian points to the many Russians now living in Limassol, a resort town offering all the comforts of home. There’s also the siren call of Cyprus’s low corporate tax rate for Russian businesses. And, last but not least, there’s the 2.5-billion-euro loan Russia has promised to boost Cyprus’s flagging economy. The second instalment was delivered on Jan. 26.

The right way for the West to get tough with Iran

By the editors - Monday, January 30, 2012 at 10:00 AM - 0 Comments

Ali Mohammad/AFP/Getty Images

This week the Western world dramatically increased its sanctions against Iran, an effort to stem the country’s nuclear ambitions. While the array of economic deterrents is now quite broad and deep, the history of sanctions as useful policy weapons is hardly reassuring. For everyone’s sake, we should hope they’re sufficient this time around.

The European Union announced Monday that it will no longer buy Iranian oil. The 27 member countries currently consume a fifth of Iran’s output; the loss of this market will put a sizable hole in the country’s coffers. The EU also unveiled sanctions on currency transactions that will further isolate Iran’s central bank and limit the country’s ability to engage in global trade.

Canada enacted similar sanctions last November, banning almost all financial dealings and expanding the list of goods prohibited from sale to Iran. Taken together with strict measures announced by U.S. President Barack Obama in December, the scope of sanctions aimed at Iran represents an impressive display of unanimity and commitment among Western nations.

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Is the ‘Estonian miracle’ just smart management?

By Richard Warnica - Tuesday, November 15, 2011 at 11:20 AM - 7 Comments

Miracles are always more complicated than they first appear. Even the word itself—miracle—is a kind of hedge. It’s a guard against deeper scrutiny, a way of pointing to the wonderful without probing too deeply into the details. Such is the case with the economic miracle in Estonia. The tiny tiger of the Baltic is being hailed as the anti-Greece, both for its fiscal austerity and stoic acceptance of such. But the story of how this nation of 1.3 million crawled out of the 2008 crash, gained entrance to the eurozone and set itself on the path to, fingers crossed, prosperity is both messier and more pragmatic than “miracle” implies.

Beginning in 2009, the Estonian government undertook a policy of “fiscal retrenchment”—it tanked its own economy, basically, cutting spending and raising taxes even as the rest of the West indulged in a binge of Keynesian excess. Between 2000 and 2007, Estonian GDP climbed an average of eight per cent per year. In 2009, it tumbled 14 per cent. Unemployment hit 19 per cent that year, and wages, in the private and public sectors, were slashed, in some cases by as much as 40 per cent.

And for all this, the government was praised. There were no mass protests, no legislative walkouts, no rioters tearing up the cobblestones in the streets of Tallinn. “If you look at what the [polls] said in spring of 2009, before they made the cuts, and what they were in October, November, they actually went up,” says Ringa Raudla, a senior researcher in public administration at the Tallinn University of Technology. In March 2011, the same parties that implemented the austerity plan were re-elected to another term. “People actually supported cutting the budget rather than taking out loans,” Raudla says. Continue…

Acropolis now: Greece may be just the start

By Michael Petrou with Stavroula Logothettis - Friday, November 11, 2011 at 11:00 AM - 33 Comments

Orestis Panagiotou/Keystone Press

“We are finished as a nation,” says Marko Gjini, a 39-year-old unemployed construction worker in Athens. “The country has been sold off. We have no say in anything anymore. Greece is owned by the Germans.”

Like many Greeks these days, Gjini is bitter and despondent because of his country’s financial mess, and the austerity measures that have been imposed in an effort to contain it. His wife, Aleka, a public hospital nurse, has seen her income drop from 1,200 euros a month to 800 euros. Now, facing more taxes and cuts to public expenditures, the family expects to have a net monthly income of less than 500 euros. Marko and Aleka are investing whatever money they can toward English lessons for their twin eight-year-old boys in the hope that they might have a better future somewhere else. “Let the government fall,” says Gjini, “[German Chancellor Angela] Merkel is the boss now anyway.”

Greece’s financial troubles have been accelerating since 2008, and have now reached a crisis point. Unable to pay debts accumulated through years of wild spending and financial mismanagement, covered up by blatant cooking of the books, last May the country accepted a $150-billion bailout loan from the International Monetary Fund and other members of the eurozone—those European Union countries that use the common euro currency—in return for imposing harsh austerity measures. These weren’t popular among ordinary Greeks; strikes and street protests followed. Three bank officials died in May when rioters set fire to their bank branch in downtown Athens.

The Greek government, meanwhile, missed its financial targets. Rescue loans were delayed. And the recession got worse. Facing the very real possibility of defaulting on its enormous national debt, Greece last month negotiated another bailout package involving cash and a 50 per cent “haircut” off all its privately held debt, if Greece would agree to further cuts to public spending and increased taxes.

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Stephen Harper lectures the world

By Aaron Wherry - Thursday, October 13, 2011 at 2:50 PM - 13 Comments

The Prime Minister calls on Europe and the G20 to get their respective and collective houses in order.

Events in the summer of 2011 have made it clear that global economic challenges are by no means behind us. What started as a sovereign debt crisis in smaller countries in Europe has now spread, causing extreme stress in the European financial sector and threatening global growth. Unfortunately, this time, the policy response to our shared challenges has not been as strong and co-ordinated as it needs to be. This slow response has resulted in missed opportunities, with each missed opportunity increasing the cost and difficulty of resolving the crisis.

We cannot afford any more missed opportunities.

Last month, Scott Clark and Peter DeVries noted that Mr. Harper was among those leaders calling on “surplus” countries “to increase their expansion of domestic demand” and thus wondered whether the Prime Minister was willing to participate in a global stimulus package (to the tune of $41 billion).

Can the EU be saved?

By Jason Kirby and Michael Petrou - Friday, August 19, 2011 at 8:00 AM - 16 Comments

Reuters/Yiorgos Karahalis

Until recently, the tiny German town of Guben was best known—to those who knew it at all—for two things. With only the narrow Neisse river separating it from the Polish town of Gubin, it is one of few place where Germans and Poles live so close together. That, and Guben is also where the controversial anatomist Gunther von Hagens, famous for his museum displays of skinless human cadavers seated at poker tables, set up a factory six years ago to treat and preserve corpses.

Now Guben’s mayor, Klaus-Dieter Hübner, has set off alarm bells in Europe by calling for border controls to be put in place to stop Polish “criminals” from looting German businesses. Since 2007, when Poland joined the Schengen zone, a border-free travel area consisting of 25 European countries, Germans and Poles have freely criss-crossed into each other’s countries to shop, dine and work. With his call for security checks at the border, Hübner has challenged one of the pillars of modern Europe: the free movement of people and goods between nations.

Taken on its own, the border squabble in Guben is a seemingly minor concern, but it comes as the twin forces of economic stagnation and surging nationalism threaten to tear Europe apart. Even as European leaders struggle to halt the spread of the debt crisis—a task that they increasingly appear unable to handle—a wider backlash against European integration poses an existential crisis for the continent. Europe is failing, both economically and politically, leading to the question: can it be saved, or is Europe destined for the embalming slab in Guben?

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Down and out in London

By Michael Petrou - Wednesday, August 17, 2011 at 9:00 AM - 0 Comments

When the European Union expanded its borders eastward in 2004, more than half a million Poles took advantage of the newly opened border to pack up and move to Britain. They were joined by thousands more Czechs and Slovenians, and after the EU expanded again in 2007, migrants from Bulgaria and Romania.

Many thrived. Suddenly traditional English pubs were staffed by servers with Eastern European accents. The new arrivals were so ubiquitous in the trades that “Polish plumber” became a catchphrase.

Inevitably, however, thousands have also floundered. Estimates vary, but a disproportionate percentage of homeless in London are from Eastern Europe, most of them Poles. And when they do stumble, they fall harder than the locals. Migrants who have not worked full-time for more than a year do not qualify for many social assistance programs, such as housing benefits. Last year, a charity worker found homeless Poles roasting rats. Continue…

What it takes to get back to AAA

By Erica Alini - Tuesday, August 9, 2011 at 5:50 PM - 7 Comments

By cutting the U.S. credit rating on Friday, Standard and Poor’s may well have pushed the world economy closer to a dreaded second dip into recession. Of course, downgrading the world’s largest economy is bound to have serious consequences, but Washington’s humiliation is not a first. Many of today’s AAA-rated countries have less-than-perfect credit histories. In fact, seven of the 15 nations on the AAA list of both S&P’s and Moody’s either lost their top score for a period, or had to work their way up there from lower ranks.

So how does a country climb back to a AAA rating? In one of three ways, it seems–and not all of them involve austerity: Continue…

A guide to the Anglo-Danish Marmite war

By Colby Cosh - Saturday, May 28, 2011 at 8:04 AM - 7 Comments

Nothing stirs the blood of the British like a nice slapfight over European regulation, and this goes double when food is involved. The UK press has found its latest excuse for tut-tutting and finger-waggling in the unlikeliest of places: at the bottom of the squat, distinctive little jar in which the vile breakfast spread Marmite is sold. This week, English-language journals in Denmark reported that the Scandinavian kingdom’s food regulator was having the dark brown yeast extract cleared from the shelves of shops which serve Brit expatriates.

The British reared up as one, displaying a spirit of indignant unity. “What have the Danes ever done for global cuisine?” thundered the Belfast Telegraph, breaking Godwin’s Law into splinters over its knurled Ultonian knee. (Unfortunately, a good answer might be “Not given it Marmite, at any rate.”) Fans of the quasi-foodstuff gathered on Facebook to form a “Marmite army”. Social campaigners used the ban to call attention to dubious patches in Denmark’s record on human rights and environmentalism.

It’s all good for a laugh, but the slightly overwhelmed Danish Veterinary and Food Administration hastened to point out an awkward fact: the country hasn’t technically banned Marmite. It’s being taken off the market because Denmark has a rule, introduced in 2004, that requires foods artificially fortified with extra vitamins and minerals to be approved in advance before they can be sold. Apparently scientists there were concerned that certain Anglo-Saxon breakfast cereals contained potentially harmful quantities of otherwise healthy (nay, essential) additives.

Marmite’s status as a “fortified food” has apparently only just been noticed, and the DVFA says that “it has not received an application for marketing in Denmark of Marmite or similar products with added vitamins or minerals.” A glance at the DVFA’s procedure for obtaining approval to market these foods reveals why brand owner Unilever might not be in such a hurry to file. (And it also reveals that free-trade fanatics like me should probably rein in their admiration for the EU’s trade barriers just a little.) The agency not only requires compliance with EU-wide regulations, but insists that each product pass an “individual risk assessment” performed using a made-in-Denmark scientific procedure.

In general, as its global leadership on the trans fats front suggests, Denmark seems to be pursuing a regulatory line that supports a trendy Pollanist preference for “real” food over industrial products. Leaving aside questions of libertarian and public-health merit, the conflict could not be better designed to exasperate the British. Even at the level of the corner shop, British cuisine has undergone an astonishing transformation in recent years. But like the British character itself, Brit cooking still bears lash-marks of wartime austerity; the British, though perhaps only subconsciously now, recognize otherwise-unfoodlike war foods like Bovril, Ribena, and Marmite as tokens of resistance.

There may be no reason Denmark should entertain such idiosyncrasies within its borders, but there is certainly one staggering irony created by the spectacle of zealous nutritionists banning Marmite. The brown goo, it turns out, played a critical role in the discovery and isolation of Vitamin B9, or folic acid. B9 is now understood to be pivotal to foetal development and maternal health, a truth first gleaned by English pathologist Lucy Wills when she fed Marmite to anaemic pregnant women in Bombay. Considering the incalculable benefits of this experiment to later generations of mothers around the world, perhaps scientists should consider giving the nasty stuff a free pass?

Goodbye, Ireland

By Patricia Treble - Wednesday, February 2, 2011 at 8:00 AM - 8 Comments

With their economy in a tailspin and bad financial news piling up, the Irish people are voting with their feet—they’re leaving the Emerald Isle at the rate of 1,000 a week. Last Thursday, the Economic and Social Research Institute (ESRI) published a grim forecast: net outward migration will reach 100,000 in the two years ending in April 2012.

Packing up and leaving in dire times is nothing new for Ireland. In the 1800s, millions fled the island’s famines and disease for the chance of a better life in countries such as Canada, the United States and Australia. Even recently, there have been waves of emigration. The last time the emigration numbers were as high as they are now was in 1989, when 44,000 fled the economically depressed nation. Soon after, Ireland cut taxes, attracted massive foreign investment and transformed itself into a Celtic Tiger. Property prices soared along with personal wealth.

Unfortunately, that super-quick growth was unsustainable, and with the worldwide economic downturn, Ireland’s financial and property sectors imploded, dragging down the entire economy. After promising to bail out the banks, the government saw its deficit reach a dizzying 31.5 per cent of GDP in 2010. Ireland needed a $110-billion bailout from the European Union and the International Monetary Fund in November, and it outlined $20 billion of draconian budget cuts over the next four years.

While the economy will grow this year by an anemic 1.5 per cent, the export-led expansion won’t generate enough jobs. For that, the economy needs consumer consumption to improve. And the ESRI is gloomily forecasting the Irish will keep their wallets firmly shut: “Ongoing uncertainty with respect to job stability, wages and taxation are likely to act against any rebound in consumption spending.”

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