The honourable practice of in-depth debate

Introduction

Sherry Jarrell wrote a response on the 6th November to the idea posed earlier by John Lewis about consumer protection for financial products. Her words included the sentence, “The reason the U.S. economy is as strong and vibrant as it is is because of our labor market, our capital market, and free enterprise.”

This, in turn, was picked up by Patrice Ayme who referred to this in a recent Post on his own Blog and also submitted a long comment in Sherry’s Post.  Rather than have a debate within the comments section of Sherry’s Post it seemed better to make it a separate Post.  As Patrice compared the USA unfavourably to France, where he presently is, it seemed appropriate for me to contribute my thoughts, as I lived and worked in France for many years.  Chris Snuggs.

What follows is now my response to Patrice, with Patrice’s words in bold:

It may be argued that the worldwide power of USA based corporations, and supply chains directed towards the USA, go a long way to explain the riches of said USA. Cause and effect confusion, no? The supply chains and military power came from the business, not the other way round!

In any case, the assertion that the “US economy is strong and vibrant” needs to be stridently revised. So Sherry is asserting that at the present time! I personally am still giving Obama some more time for a final judgement. At least he’s got his health bill through (unlike the  Clintons) which may help to remove a national disgrace in the US. As for “strong and vibrant”, experts can better comment than I, but from where I sit it is of course nonsense. What IS true is that the US economy has fantastic underlying strength, but what you have at the moment is a stupendously productive cow that is on its knees, having been over-milked and basically abused. Do you really doubt that once it gets up, it will once again surge ahead?

California, where everything seems, weak, decaying, falling apart, and crucial elements of society seem on their way out. I can’t argue with your local knowledge (though other locals may have something to say!), but I did spend a week in NW New Jersey some 15 years ago, when I went to stay with my au-pair daughter. I was staggered at the reality of New York compared to the image. It was clean, well-organised, and stupendous. The taxis seemed new, Liberty and Ellis Islands were sublimely well-done. Central Park was amazing; Harlem looked to me far nicer place to live than Brixton in London. True, I didn’t get to visit the Bronx …..

The train we came from Edison into New York Central seemed to be made out of stainless steel. We went on a tour to Atlantic City, then Washington, West Virginia, Gettysburg. Everywhere we met wonderful, friendly, courteous people, excellent value for money. The White House was amazing; I remember some kids playing street hockey in front of it.

My overwhelming impression was one of deep, genuine human values and a terrific interest in quality in all respects. No doubt all is not rosy in all the USA; it is a vast country, but let’s not carried away by our “Europe is better” illusions, shall we? Have you been to the satellite towns round Paris recently?

The French built the world’s tallest bridge in three years, a few years ago, with a freeway on top (the five kilometer long Viaduc de Millaut, built by Vinci, a private contractor). The French have great engineers. Who denies it? But the USA has some of the world’s most amazing bridges, skyscrapers, buildings …. do you deny THAT? I am not sure of your point. What DOES seem to me true is that many people, many States, many countries and the Human Race as a whole are LIVING BEYOND THEIR MEANS.

This is true of the British government and clearly of California as a State …. it has been technically bust for years and is now approaching the precipice I believe ….. Sadly, it is only when the depths have been plummeted that people come to their senses and start to put things right …. I believe the Yanks can do this, but the process hasn’t really started yet.

The bridge elements were built in France, on the spot, not in China. Industry is not all about financial tricks to make Wall Street critters richer, it’s also about common sense. You can’t lump all American business along with the crass, incompetent and venal bankers. Yes, America has relied too much on cheap, Asian imports, but then so have we all. This will even itself out ….. what you should be worried about is that the Chinese are starting to build their own machine tools and robots …… how is the French robot industry? Probably at least better than the British …. thank God at least that we have the Germans in Europe.

The USA has become increasingly an unreal place which has frequently assigned other parts to war. The USA as “Warmonger”? Oh Dear ……

• It got sucked into World Wars I & II – (both started in and by Europe) and in both cases saved Europe from dictatorship.
• It defended Europe during the Cold War and without this help we may well have been overrun by the Soviet Union. Even WITH their defence it was sometimes a very close thing.
• It defended South Korea and at enormous sacrifice saved the people there from 50 years of horrendously-gruesome dictatorship, which is what they have in the North, where the scale of human misery over decades is frightful.
• It tried to do the same in Vietnam, but failed. The consequences there have not been so terrible as in North Korea, but who can predict these things in advance?
• It has notoriously defended some very indefensible regimes in South America, partly because of the belief that the alternative to these horrible regimes was something even more horrible and partly to promote economic and political interests it had there. With hindsight, democracy would have been better served by it staying out.
• It even – and inexcusably – supported Sadaam Hussein’s murderous attack on Iran to the point – I believe, but am prepared to stand corrected – where it gave Iraq military intelligence it used to gas young Iranians. Once again, it supported what it believed at the time to be the lesser of two evils; one can hardly deny that Iran is a basket case; the antithesis of democracy and ruled by a bunch of ageing lunatic fundamentalists.
• It is in Afghanistan because an act of war against the WHOLE planet (I believe innocent citizens of over 70 countries died in the Twin Towers) was committed by a terrorists aided and abetted by that country’s then government. Once again, this is a case of the lesser of two evils; we are inevitably supporting a corrupt government (since practically all governments are corrupt, particularly in non-democratic and developing countries) against an evil, nihilistic and basically lunatic sect, the Taliban. Incidentally, if the Allies are struggling, it is because the rest of the world is doing little to help the forces of good against those of evil. Including, once again, France but excluding the usual suspects, the Brits, Canadians and the Germans (sort of) –  If the Taliban take over again, prepare once more for video of beheadings on football fields converted into “correction facilities”, the burning of libraries, the denial of education to women, the burning of books, paintings and music media and all the rest of it. If we have to leave, it is going to be very, very distressing for ordinary people there.
• It invaded Iraq because that country’s leader was a megalomaniac dictator who had already started one war against Iran, invaded Kuwait, not stuck to the deal drawn up after Kuwait and was attempting to develop nuclear weapons. This last point can be debated endlessly, but the facts are that he was not cooperating with the IAEA inspectors, had in previous years been trying to develop WOMD and when none materialised during the invasion even his own troops were astonished that they had nothing, so good was his own propaganda and perhaps fantasy. Saddam Hussein was a mass-murdering, megalomaniac dictator and that France – so keen on doing business with SH before the invasion – should so long and loudly campaign against the so-called warmongering Americans who in fact liberated (a bit of a habit of theirs) Iraq from their gruesome leader is really a great shame from a country that itself had to use force to rid itself of dictatorship in the Revolution and therefore – until recently – was widely admired as a symbol of freedom. Now it is a symbol of realpolitik.

The Americans almost always defend democracy; that should make them the bosom allies of France. They saved France TWICE (quite apart from 200 million Russians and all the rest of us); that should make them the ETERNAL friends of France.

Now the long term, sustainable, much more democratic European model is rising. That is an assertion of yours. We’ll see how long-term and sustainable the European model really is. Some would say it is over-bureaucratic, over-dogmatic, and lacking in moral and physical courage. You may have forgotten that it was the YANKS (at no real advantage to themselves) who liberated Kosovo, a defenceless Muslim minority. It helps little to see all this in black and white; Europe has many great virtues, but for your description, the jury is out in terms of a flourishing civilisation as against a supposedly decomposing American fading dream.

“much more democratic”? When a European country votes against a Brussels treaty (they can rarely vote, of course), the Brusselcrats just wait a while and get them to vote again till the “right” decision is made. The British were promised a referendum on the Lisbon Treaty by its government, which then refused it. The recent treaty has gone through WITHOUT referendums in most countries, because that suited the political elites there. “Much more democratic”? You are having a laugh, aren’t you?

I would guess that a majority of people DO NOT WANT a European President. They DO NOT WANT a United States of Europe, but that is what Brussels is slowly forcing on them. I am surprised that France seems to want that. This is possibly because it still thinks it can control the EU just as it did in the early days; this could be an illusion.

“the decomposing system in the USA.” – I believe that a study of the history of the USA will show a country prepared to reinvent itself through the dynamism and inventiveness of its people and its work ethic. They are going through tough times – and they will get tougher – because the political and business elite got too greedy and forgot the basic virtues of thrift, hard-work, decency and honesty that made the country great. But the pendulum will swing back and then Europe may have to look to its sclerotic, over-regulated business model to see where it went wrong.

It may be time for the USA to learn, from overseas. Are you suggesting that European banks were somehow blameless in this fiasco? The rot may have started in the USA, but there were plenty of stupid and greedy bankers in Europe, and of course governments benefiting from this temporary and insane feeding frenzy.  I see no particular signs that Europe is developing a banking model that will stun the world with its integrity and efficiency. The whole of Britain’s economy was built on the sands of easy credit during the 90s, and the greatest of ironies is that the British Finance Minster responsible for all that is now lecturing the rest of the world as a so-called “Global Giant” on how to put things right. You couldn’t make it up, except that with successive supine, incompetent and short-termist European governments, we are so used to it that we know what’s going to happen almost before it does.

By “we” of course, I mean the mass of the people, who often seem to me to have far more common sense than the political heavyweights of Europe that seem to impress you.

If the “game” organized by the government is biased in favor of a few particular individuals (as it is right now in the USA, be those individuals private-public politicians, or Big Bankers, friends and clients of the preceding, and vice versa), what has happened to democracy, equal opportunity, freedom and the like?

Yes, a good question …… Democracy is in pain … the industrial, military, political power elite in the USA has too much power ….. this is obvious to me, but we’ll have to wait and see when it becomes so obvious to the people of the USA that they start to put it right. They voted for Obama in the hope that he WOULD start to put this right …… the jury is still out, but real change certainly won’t come overnight …..

As for the favoured elite, are you implying that this doesn’t exist in France? I am sorry to say that it is not only existent but thriving …. Many of the top people all go to the same few Grandes Ecoles.  Someone told me recently that 30% of the French education budget is spent on just 4% of the elite schools. Hence the decaying, inefficient, sub-standard university education for the plebs. And this is from France, that likes to think itself superior in culture, education and so on. YES, there are world class French companies with brilliant engineers, but they train at super-privileged schools while the masses put up with a sclerotic, conservative and basically crap education system. I should know; my stepsons are in it because I couldn’t afford the fees for a posh school.

On French coins it proudly boasts, “Liberty, Equality and Fraternity”. It is a LIE. There is little equality when it comes to higher education. And when the elite get their fancy diplomas, most are recruited by Old Boys of their elite schools; the cronyism and inherent corruption are easily as bad as anything in the USA, so let’s not get too self-righteous, shall we?

The elite? When Chirac became President, he said that the exaggerated power of the ENA (the top school for Administrators of the French state) would be cut back as it was not good for France. He was right, but did nothing whatsoever about it. He either lied or couldn’t deliver against the powerful vested interests, and by golly those are just as powerful in France as anywhere else. More so; they are completely institutionalised. I can’t list one single profound, structural reform that Chirac achieved.

Take just ONE small example. They have a lunatic system of taxi-licences in Paris. Basically, you buy your licence to run a taxi from an existing driver who retires or dies, the current price being about €100,000 ($148,000). Paris has the fewest proportion of taxis to people in the whole of Europe, I believe, but they can’t issue more licences or the price of licences would fall and the taxi-drivers would be cross. So when you arrive in Paris A) there aren’t enough taxis and B) those there are cost too much.

The dying embers of Chirac’s lame-duck administration tried to reform this, but the taxi-drivers instantly blocked the peripherique and the reform was abandoned just as instantly. Not for nothing do they say in France: “Plus ça change, plus c’est la même chose.”

Democracy, the Law and Equality? Before becoming President, Chirac ran Paris for 15 years and it is common knowledge that there was a whole raft of illegal activities going on to finance his party; fictitious jobs, diversion of funds and in general a regime of corrupt political chicanery, cronyism and corruption. This was kinda tolerated by the French people because, well, “c’est comme ça”. One is so used to it one can only shrug one’s shoulders. At last, nearly two decades after Chirac ceased to be Mayor of Paris, he is about to appear in court for the crimes that occurred under his leadership. He couldn’t be prosecuted while President because the French President is “too important” and is therefore above the law. Let’s compare that to the USA, shall we, where wrong-doing by Nixon drove him out of office? The Clinton affair was ludicrous nastiness by the Republicans, but shows at least that the Americans put the law above politicians, not the reverse. “Egalité”? The French Presidency (which is even more elitist and powerful than the Washington version) is currently reeling under allegations of nepotism ionvolving Sarkozy’s son Jean. Not yet fully qyualified, he was earmarked to run a prestigious multi-million project at “La Défencé until even the French could not stomach it and he was forced to back out.  So let’s not have lectures from France about “democracy”, shall we? There is a world-wide problem of corruption almost everywhere among political leaders (except possibly in Scandinavia, Switzerland, Canada and a few other enclaves of hope), but let’s get the US in perspective.

What sort of integrity was it to give or lend or guarantee to Big Bankers so many trillion of dollars, without anything in return from them? Are the richest people in the USA so used to get money for nothing (thanks to a perverse tax structure, and decades of buying the most powerful politicians), that they cannot even say thank you? It wasn’t any sort of integrity at all; it was panic. But never under-estimate the power of the elite and rich, either in the USA OR in Europe (especially France) . All the banks should have been allowed to go bust and their directors go on the dole. Then the assets would have been bought up by someone else who would have installed new directors and started doing business in a better, wiser way, while we waited for a more efficient regulatory regime. Instead, governments panicked, poured in billions overnight, telling us it was for OUR OWN benefit, allowed most managers responsible for the mess to keep their jobs and – surprise, surprise – a year or so later the banks are at it again with their vast bonuses. It is no wonder the average Joe is mighty angry, and this could have bad consequences down the line, even for democracy itself.

Western, civilisation needs a massive reality check; the mad consumerism – and greed of the elite – have to be checked. ENRON gave us a warning we didn’t heed. There you had directors already rich beyond the dreams of most people and yet who even so wanted more, to the point where they engineered false breakdowns at power-stations to put up the price of electricity. That was a wake-up call that went unheeded as far as Wall Street was concerned.

People with a democratic and republican mind ought to ask these questions, instead of celebrating. Who exactly is celebrating? Seems to me that only those at Goldman Sachs and in comparable positions are celebrating … your average American is suffering, mostly through no fault of his own.  If some are talking up the economy it is of course because morale counts for a lot … I believe that standard economic thinking is that if people feel better they’ll spend more and the economy will grow …..  Well, the people may indeed at some stage “feel better”, but they will need to SEE and EXPERIENCE it rather than believe it in the mouths of pundits, since as far as I can see the average pleb is fed up with “talking”, spin and image.

an incomparable rot.: there is rot, but it is not incomparable. All “empires”, and in its size, wealth and power the US is comparable to an empire (a demopire, perhaps?) go through these cycles, and in many cases they go into terminal decline. However, I believe in the Americans’ inherent qualities to get them out of this, but it will not be easy.

Nobody can predict the future, but I will be very interested to see – if I am still around – how Europe and the USA compare in 20 years’ time. I don’t think I will be surprised, but maybe you will be, Patrice …..

What’s good in France? Technicians are highly-skilled; civil works are good; I mean public gardens, parks, infrastructure. But of course we pay very high taxes for all this, and especially employers. It is so expensive to employ people that employers try not to. Instead, they find ways of working better, which results in the productivity per worker being higher in France than in the US but unemployment in France being persistently higher than almost anywhere else, especially among the youth. Successive governments in France seem not to understand the connection between very high labour costs and high unemployment. Or they understand it and don’t care.

Sorry – this was supposed to be about good things in France!! Well, motorways are very good, but increasingly more expensive. They are much safer, but poor people prefer the normal roads, which are free but more dangerous. Ergo, better-off people are safer!! Vive l’égalité!

Food is excellent, restaurants cheap, except in chic parts of major cities. Wine is cheap. Standards in general are high, healthcare is excellent but the system is creaking under heavy costs. The bureaucracy is appalling for an Anglo-Saxon, but the British are becoming as bad. (French bureaucracy – which I lived under for 10 years – deserves an article of its own …..)

Let’s retain a sense of proportion, however …..

By Chris Snuggs