World

Europe's Deal: So Who Wins?

The grand bargain between Germany, France, and the European Central Bank (ECB) is being hailed as a diplomatic breakthrough that will save the euro and the European Union (EU). The essence of the deal is this: EU nations commit to an enforceable austerity program, which is ad hoc for now but will eventually become a formal part of the EU treaty. It will take the shape of tight limits on budget deficits, with penalties. That, in turn, gives the ECB the fig leaf it needs to heavily support purchases of bonds from countries like Italy, whose debt has come under speculative attack. All of this reassures markets, and the cost of borrowing comes down. In turn, bank holdings of sovereign bonds retain their value. To make this deal possible, Germany has backed off its absolute opposition to supporting weaker economies and using the ECB to tacitly support sovereign debt. And France has agreed to give up some of its cherished fiscal sovereignty to the EU. Isn’t this wonderful? No, it’s terrible...

Die, Faggots

I have a tendency to hurrah, regularly, about how vastly American attitudes toward lesbians and gay men have improved. (Attitudes toward transgendered folks are much further behind, as I will discuss here soon, as that column of the movement started later and includes fewer people.) But whenever I write about how amazing it is that I never worry that someone will call me a f***ing dyke on the street, or that The New York Times not only uses "gay" instead of "homosexual" but actually profiles same-sex couples in the wedding section, I am reminded that it's not this way everywhere. For instance, while adults can choose to live in parts of the country that are more or less welcoming, children have no choice in the microcultures we call "family" and "school." Some of those are welcoming; some, not so much. Belatedly, I came across this YouTube video , posted in August, by a boy who said he had been bullied since first grade ("fag! homo!"), had been cutting himself, was terrified to enter...

Why Egypt Matters

(AGF s.r.l./Rex Features via AP Images) A woman votes at the polling station during parliamentary elections in Cairo, Egypt. Egyptians flocked to the polls for the first post-revolution elections after a week of violence and political crisis. T he women banter with the soldiers and get through the checkpoint carrying bombs in their handbags. We see them in black and white, which sharpens the lines in their faces and shows their fear more starkly. They arrive at their target. One enters a restaurant. The camera pans the people eating as she pushes her bag under the counter and leaves. As individuals, the victims are innocent, but seeing the world from the camera's perspective has already told us that the explosion that will rip them apart belongs to revolutionary necessity. This is a sequence from The Battle of Algiers , the classic 1966 drama about the uprising that drove France from its central North African colony. The film is worth watching again this week, when the Egyptian...

The Cost of Free Trade

Every president asserts that the next trade treaty will turn America into an export powerhouse, but that's just not true.

A ny renaissance of American manufacturing must begin by fundamentally reversing our trade policies—both in general and in particular toward China. Over the past two decades, leading U.S. manufacturers, both the venerable (like General Electric) and the new (like Apple), have offshored millions of jobs—by one recent estimate, 2.9 million—to China to take advantage of the cheap labor, generous state subsidies, and low currency valuation that are linchpins of China’s mercantilist development strategy. Other factors, including increasingly automated production, have also taken a toll on America’s manufacturing workforce, but it’s the mass exodus of American production to China and, more recently, the rise of indigenous, state-subsidized Chinese production that have decimated American industry and reduced the incomes of American workers. The United States government did not have to stand idly by while the nation’s industrial base was disassembled. It could have preserved and promoted key...

So You Think You Have Problems?

Even if your parents didn't like who you dated, they didn't send him to Siberia. And while they may haunt you in various ways after their deaths, that haunting can never weigh on you as much as Stalin's overhanging ghost. Do read this sad obituary of someone who, because of her father, could never find a place in life: “Wherever I go,” she said, “here, or Switzerland, or India, or wherever. Australia. Some island. I will always be a political prisoner of my father’s name.” Yes, the sins of the fathers are indeed visited upon the children, often in very peculiar ways.

Good News, Bad News for Europe

The good news? France and Germany seem to be in agreement. The bad news? They agree Europe needs more belt tightening so that bankers can get more relief. The leaders of France and Germany, reportedly, are discussing ways to compel European nations to have a common fiscal policy without resorting to the cumbersome process of amending the EU treaty. This was enough to reassure stock markets for the moment, which are nothing if not subject to herd instincts. But who are we kidding here? More austerity may appease the bankers’ need for their pound of flesh, but it will only make the Great Deflation worse. A common fiscal policy is a good idea, but one biased towards austerity is exactly the wrong medicine Before this crisis is over, the Europeans will need to find their way to a common invest-and-grow strategy, which includes debt relief for struggling countries; as well as Euro-bonds and a real crackdown on banker abuses. And the European Central Bank will have to function as a true...

For Europe, High Stakes in Greece

Stabilizing one teetering economy won't end the eurozone's dance of death.

T he problems of the euro turned critical when the Greek government nearly defaulted in May 2010 and the International Monetary Fund and European Union agreed to a bailout. In truth, the 17-nation euro area had deep troubles long before that. Its oversized and undercapitalized banks, its common monetary policy but diverse and fragmented fiscal policies, the persistent economic imbalances among nations that use the euro, and a cumbersome decision-making structure all made the euro-area economy vulnerable. The crisis, which still bears the mark of the Greek tragedy that first set it off, has now spread far beyond Greece. The euro was created for normal times, but the EU lacked good mechanisms for crisis management. At every step of the Greek drama, policy-maker responses have remained behind the curve of economic deterioration. Slowly but surely, this erosion of confidence ensnared other countries, such as Ireland and Portugal, then spread to Spain and Italy, both perceived to be...

Woe Is Europe

A week of credit-rating downgrades and skyrocketing interest rates fuels fears the monetary union is doomed.

(AP Photo/Michael Probst) T hings are now hanging by a thread in Europe. In a disastrous auction of two-year bonds and six-month bills on Friday, Italy was forced to pay interest rates of 7.8 percent and 6.5 percent, respectively—levels far higher than those that sent Greece into the arms of its troika of lenders. Spain, despite the emphatic election a week ago of a new right-wing government committed to austerity, on Tuesday paid an average yield of 5.11 percent on three-month bills and 5.23 percent on six-month bills. The three-month yields were more than double what the country paid a month ago, while the six-month bills had cost it only 3.30 percent in October. Rumors have begun circulating that the new government is planning to ask for some form of outside help to service its debts. Belgium’s credit rating was downgraded by Standard & Poor’s and Portugal was downgraded to junk by Fitch. Even Germany felt the tremors of market turbulence, managing on Thursday to sell only 3.64...

Why Are They So Angry?

An Israeli dove in Jewish America

"He's lying! He's lying!" the man at the back of the hall shouted, in a tone as desperate as it was angry. "He hasn't read the Geneva Conventions. You haven't read them, so you don't know he's lying." The primary object of his rage was me. The secondary object, it seemed, was his fellow congregants, who'd allowed me to lecture at his New York-area synagogue. I'd spoken about threats to Israel's democracy, including those posed by ongoing expansion of West Bank settlements. This was the first time, I'd been told, that the congregation had hosted a speaker on Israel from outside a spectrum running from right-wing to very right-wing. During the question-and-answer period, I was asked about my statement that the legal counsel of Israel's Foreign Ministry had warned before the first West Bank settlement was established that it would violate the agreement of the Fourth Geneva Convention. That's when the man in the back came unstuck. The congregation's rabbi, who was moderating the Q&A...

The Body Politic

Criticism of an Egyptian blogger's nude photos underscore liberal worries about seeming too radical.

Aliaa El Mahdy
As the now historic Tahrir Square filled with protesters over the weekend, the tension between the hope and momentum of the February uprising that ended a 30 year dictatorship and the aggressive, violent military response to a mass civilian demonstration almost one year later was startling. After three days, 23 dead, and over 1500 wounded, it is clear that the transition to a new Egypt is not going to come easily. Surprisingly, the group that has proved to be the most awkward fit into the new Egypt are the youth who engineered the uprising that brought President Mubarak’s reign to an end. Idealistic, peaceful, and largely secular, the success of the Egyptian youth movement became an instant promise of change and possibility. Now, however, their moment in the sun seems to be fading, eclipsed by a military stronghold and the emerging power of the Muslim Brotherhood that was -once outlawed, and is now the main challenge to the military controlled government. With the state under a...

Lies, Damn Lies, and Adoption

Over the past two months, I’ve posted a few items about fraud and corruption in international adoption, a subject I’ve reported on extensively . Of the many articles I wrote on the topic, one story in particular broke my heart—and illuminated how such frauds occur. I’ve just heard, again, from one of the principals in the situation, and I’d like to post his letter. Before I do so, here’s a summary of—and links to—the articles that offer background. In brief: In 1998, Americans adopted 29 children from a town in Sierra Leone whose birth families now say they were stolen. At the time, the Americans believed they were saving desperate orphans from a brutal civil war. But the birth families have now testified that they were offered a free education for their children and were never told that those children would leave the country—much less that the children would be permanently taken away by foreigners. In reporting that story, I ended up talking to people at every stage of the adoption...

Exit Berlusconi, Enter Uncertainty

AP Photo
It was a busy weekend in Italian politics. The Chamber of Deputies passed the latest round of austerity measures, Prime Minister Silvio Berlusconi resigned, and President Giorgio Napolitano mandated Mario Monti, a respected economist and former EU commissioner, to form of a new government of national unity. The backdrop to all this frenzied activity was the country’s growing liquidity crisis: As Italy, the world’s third largest bond market, saw its borrowing costs rise to unsustainable levels in recent weeks, the rest of the planet could only watch in numb horror, as if observing a slow-motion car crash. On Monday, as Monti was in talks with the political parties for the formation of the new cabinet—made up almost exclusively of unelected technocrats—the main index of the Milan stock exchange opened with a 1 percent jump. By the end of the session, though, it was down 2 percent as were the main indices in Spain (-2.2 percent), Germany (-1.2 percent), and France (-1.3 percent). The...

A State of Chaos

How political failures and stagnant institutions brought Greece to the brink of collapse

A protester chants slogans during a protest in front of the Greek Parliament in Athens on Saturday, Oct. 15 2011. About 2,000 protesters turned up at Syntagma Square, outside Parliament, to protest against a new austerity package that is to be voted upon on Thursday. (AP Photo/Kostas Tsironis)
(AP Photo/Kostas Tsironis) About 2,000 protesters turned up at Syntagma Square, outside the Greek parliament, to protest against a new austerity package agreed to in October. G reece is at the breaking point. The autumn air is filled with despair at falling living standards and the inability to meet ever-burgeoning tax burdens and with fury at the political class, members of which are routinely mobbed, showered with eggs and yogurt, even occasionally beaten. Because of striking public-sector unions, Athens regularly lacks public transport, and its streets are often strewn with garbage. The young, with little hope of productive work, divide their time between rioting and looking for a promising place to emigrate. The older generation, those with families, medical bills, and after-school tuition fees, grimly hold on, cutting consumption down to the absolute necessities and eating into their savings to survive. Sometimes, they take to the streets, too. The middle class, such as it was,...

We're Not in Athens Anymore

The selection of Loukas Papademos as prime minister heralds a new era in Greek politics.

Greek and international media cover the statements of the new Greek Prime Minister Lucas Papademos , centre, outside the presidential palace in Athens, Thursday, Nov. 10, 2011. Papademos was named Thursday as the prime minister of the new Greek interim government, charged with keeping the debt-strapped country out of bankruptcy and firmly in the 17-nation eurozone. After four days of intense political negotiations, the 64-year-old former vice president of the European Central Bank was chosen to lead a coalition backed by both the governing Socialists and opposition conservatives that will operate until early elections in February. (AP Photo/Thanassis Stavrakis)
Greeks, Europeans, and anyone else who knew the score breathed a huge sigh of relief at the news that Loukas Papademos, the former deputy head of the European Central Bank, will be Greece’s new prime minister. His appointment, especially compared with some of the other names that were bandied about during the past few days as candidates for the post, is the best one could have hoped for if—at least if one believes that Greece belongs in the eurozone and that an exit from it, which became an ominously fashionable topic of discussion among Europe’s leaders the last few days, would be a disaster not only for Greece but for the whole euro project. As I mentioned Monday, Papademos is a serious man, who has the background and the respect among European leaders that will allow him to guide Greece through the treacherous months ahead. As the country moves forward—his term is expected to last about four to five months, though as he said yesterday, there is no fixed date for new elections—his...

Banker's Choice

In this, Monday, Oct. 30, 2006 file photo provided by the Italian presidency, Italian President Giorgio Napolitano, right, shakes hands with Mario Monti on the occasion of the opening of the academic year at the Bocconi university in Milan. Italy's president has unexpectedly named Wednesday, Nov. 9, 2011, as a senator-for-life Mario Monti, the former European competition commissioner who is widely considered to be a top contender for the Italian premiership, now that Silvio Berlusconi has pledged to resign soon. The surprise move Wednesday night could be a prelude to Monti's getting the nod to head the next government. President Giorgio Napolitano's office announced he had chosen Monti, who now runs prestigious Bocconi University in Milan, for the honor. Senators-for-life include notable figures outside of politics and have voting privileges in the Senate. (AP Photo/Enrico Oliverio,Italian Presidency Press office, File)
So Greece has a new prime minister – Lucas Papademos – and Italy looks about to have a new one, too – Mario Monti. To which not just you and I but damn near every Italian and Greek responds, “Who?” Neither Papademos nor Monti has ever held elective office, or even run for one. Neither has been a minister, sub-minister or even civil servant in one of their nation’s ministries. Neither has developed, or sought to develop, a public following from their careers as economic technicians, chiefly on the European supra-national level. Yet each is about to lead a major nation. Papademos and Monti are something new under the sun: national leaders elected by the markets. Imposed, not as pro-consels by foreign occupiers, but by the European banking community, by the finance ministers of the Eurozone powers – chiefly, Germany and France. Each has an impressive resume and a good reputation with the centrist political and economic elites of his own nation, but there’s no reason why the person on the...

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