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November 28, 2010
 by Steven Hill

ATHENS, BIRTHPLACE OF DEMOCRACY...DEMOCRACY, THE CORE OF THE WESTERN CANON...One of the places I had been most eager to visit in Athens is the Agora, the 2,500-year-old birthplace of democracy. Located at the base of the Acropolis and just across the rail tracks from the tavernas and cafes of the Monastiraki district, the ancient Agora site today is only a few sparse acres hemmed in by a modern city. But its importance looms large in the western canon.

A few of the Agora’s ancient buildings have been reconstructed, but most of the site is still in ruins, with stubs of columns, old walls, and headless busts poking out from the earth that has swallowed them. You have to use your imagination a bit to visualize it. I came to this ancient place to see if these old stones and walls would talk to me. These shards hold a secret I wished to unlock, a pulsing in their mortar and fragments that I can feel when I touch my palms to their gritty gray surface. “Agora” means “assembly place,” and this spot was a crucial intersection for a throbbing polis that began over two thousand years before the first settlers reached what would become the United States. Physically the Agora was a large public square flanked on several sides by major civic buildings, inside of which merchants sold their goods and services from shops and stalls amid the colonnades. It was a beehive of commercial activity, with everything from fruit and livestock to perfume, hardware, money-changing, and even slaves trading hands.

But the Agora also was where Athenians gathered for the exchange of ideas as well as goods. Among the hive of stalls, a ferment of debate over philosophy, ethics, democracy, and politics unfolded on a daily basis. Philosophers, statesmen, orators and dramatists, little known outside Athens at the time but who were to become giants of the western canon, traded ideas and policies at the Agora. Pericles, Thucydides, Aristophanes, Plato, Alcibiades, Aristides and Themistocles were regulars. Socrates was a constant presence there. “He was always on public view,” wrote the historian Xenophon, “for early in the morning he used to go to the walkways and gymnasia, to appear in the agora as it filled up, and to be present wherever he would meet with the most people.”

This hotbed of intellectual and commercial bustle was fed by a particular innovation in human organization that had appeared on the scene just a few years before. After several million years of human anatomical evolution, and a few tens of thousands of years of social evolution, at this moment in history something ground-breaking appeared, a revolutionary game changer: democracy. Around 508 BC the nobleman Kleisthenes organized Athens into 10 tribes. Each of the tribes were empowered to choose by lot fifty of its citizens who together comprised a 500 member Boule (Senate). The Boule prepared legislative bills to be voted on directly by an Assembly of All Citizens (Ekklesia of the Demos). Some 30,000 adult males of Athenian birth were eligible to vote out of a total population of around 250,000 men, women, and children, free and unfree. Of those 30,000, perhaps 5,000 might regularly attend one or more meetings of the Assembly of All Citizens, of which there were at least forty a year in Aristotle’s day. Those at the Assembly did not elect representatives to vote on their behalf, they voted directly on legislation and executive bills.

I stood before the sparse skeleton of one building, which once stood in a row of administration buildings on one side of the main square. This building was the meeting place of the 500 member Boule. Next door is the remains of one of the more significant public buildings of the Agora, known as the Tholos. Originally an enclosed circular structure with six interior columns, today all that is visible is the circumference of the foundation. But it was the headquarters of the 50 citizens who served as administrators for 35 days, after which they were replaced by citizens from another tribe. By the end of the year’s rotations, representatives from all 10 tribes had a turn in the administration. No petty partisans or special interests trying to prevent the other side from governing, or trying to claw their way into power by hook or by crook -- no, in ancient Athens they took turns. Perhaps Kleisthenes , who is considered the father of Athenian democracy, understood something essential about how to avoid the balkanization and polarization that plagues U.S. democracy. Rotation of power ensures compliance with the golden rule, “Do unto others…”, because you know that those over whom you are lording today will soon lord over you.

Not far from these buildings stood a pedestal once decorated with bronze statues of the mythical heroes of each of the 10 tribes, and a relic of it is in situtoday. On the sides of this pedestal hung wooden boards with announcements for the citizens of Athens, including legal decrees coming up for a vote, forthcoming lawsuits, lists of citizens conscripted into the army, civic or honorary distinctions and the like -- their version of a central kiosk or internet message board.

At the time, Athenian democracy was cutting edge stuff, but all was not rosy from a modern perspective. Women were totally excluded, this was a men’s club; foreigners, especially unfree slave foreigners, were excluded as well. The citizen body was a closed political elite with a small electorate, similar to America at its founding in 1789 when only white men of property could vote and many of the founders owned slaves who they agreed would be counted as 3/5 of a free person. And of course, Athenian democracy showed its limitations when it condemned Socrates to death in 399 BC just because he asked too many blunt questions to those in power. The site of the jail where the pesky inquisitor (“the gadfly,” as Plato described him) was imprisoned and suffered his sentence -- death by hemlock poison -- also is located here, occupying an out of the way corner from the central square of the Agora.

The ebb and flow of the democratic tide. Standing there in the dusty middle of what is left of the Agora, scanning the column nubs and half statues that look like rows of broken teeth, I was visited by the ghosts of the past. Down the tunnel of time I thought I could hear the distant cacophony of traders and merchants hawking their wares, and see the ghosts of Pericles’ entourage pushing through the crowds, and spy Socrates off to one side with a knot of impressionable young males gathered round (one of them looking like Plato). I felt momentarily dizzy, lost in a contemplation of democracy’s centuries-long sojourn. Beyond Athens, Europe’s ancient cradle is scattered with nascencies and power spots that mark the ebb and flow of the democratic tide that eventually led to American shores. I have visited many of these democracy birthplaces during my own travels, my personal pilgrimage to the temples of democracy and representative government, and they always inspire and move me. Instead of a pilgrimage to St. Peter’s, Santiago de Compostela, or Mecca, these are the stations of the cross for a different kind of religion: the worship of a free people who cherish equality, liberty, and the pursuit of happiness. These are the ancestral sanctuaries that led, eventually, to the American experiment launched in 1789 and which, by the early 1830s, was so buzzing with pluralism that the Frenchman Alexis de Tocqueville described it as a “tumult” of democracy.

But I digress. There must have been something in the Mediterranean air around 500 BC, because contemporaneously with Kleisthenes’ new code, ancient Rome took its first halting steps toward democracy. It began with the overthrow of a monarch also around 508 BC, followed by the launch of the structures that became the Roman Republic. While the Roman Republic and its representative democracy was dominated by wealthy families and eventually collapsed into dictatorship, for a time it was more representative than any of our modern-day republics. That’s because it granted an explicit “representation quota” to its poorest citizens. In the early Republic’s Centuriate Assembly (where all male citizens of military age were enrolled in one of five voting groups based on economic class), the poorest classes were able to have their say. While the voting was weighted in such a way that the wealthier elements could always outvote the poorest, at least the poor were at the political table. In the middle Roman Republic, the poorer classes exclusively elected ten high-level leaders, called the tribunes of the plebeians, who could use their office to take up the causes of the poor. So even in the oligarchic Roman Republic, class was distinctly recognized and formally incorporated into the voting practices and institutions, yet today the idea of such affirmative action along class lines is ridiculed. Instead, poor people pretty much have opted out of politics in the United States, since there are no class quotas, no tribunes like the Gracchi brothers to speak for them, and little hope that a viable political party might arise that can represent their interests (the poor in Europe, however, vote in higher numbers due to different electoral rules creating multiparty democracy that provides more choices to voters).

Rome’s republic ebbed and flowed, reacting to the times, until it was subverted during a series of civil wars and finally collapsed into an empire when Caesar crossed the Rubicon at the head of his army. But it lasted in one form or another for 482 years. Considering that the American republic has been around for less than half that time, Rome provides a cautionary tale that democracy cannot be taken for granted, it must be renewed and re-nourished by every generation.

The legacy of Luther and Cromwell: political democracy. Continuing on from Rome with my democratic pilgrimage, one of my favorite treks was to a place located twenty miles outside of London. There lies a large, verdant green pasture that goes by the name of Runnymede. The River Thames winds through it, just a silver sliver this far from its mouth, but history rolls down the river from here to London and beyond. Runnymede is a hallowed place and name, it also is one of the birthplaces of modern democracy. Here, in the year 1215, somewhere in this water meadow -- the exact spot is unknown -- King John put his seal to what is known as the Magna Carta, an agreement that required the king to accept that his will could be bound by laws and to respect certain legal procedures. The Magna Carta is considered one of the most important legal documents in the history of democracy, having influenced many common law documents since that time, such as the United States Constitution, the Bill of Rights, and many European constitutions.

As I walked around the field at Runnymede, avoiding the cow pies and mud while lost in a reverie regarding democracy’s earthy roots, I saw its trajectory as if it were written across the sky: Athens in the fifth century B.C., the Roman Republic until the time of Christ, then, the trail goes cold for a long period until Runnymede. After that it slowly gains steam until it emerges in an unlikely place: Wittenberg in eastern Germany in 1517. That’s when Martin Luther nailed his 95 Theses to the church’s door, protesting papal abuses and championing the radical notion that an individual needs no priestly intermediary between himself and God. Within months Luther’s petition had spread like wildfire, sparking the Protestant Reformation against the Catholic Church hierarchy, one of the first controversies fanned by mass publication via the recently invented printing press. While Luther’s name and deed loom large historically, few have recognized how his defiance of religious authority, as well as his championing of individual conscience and spiritual enfranchisement, advanced the pre-attitudes necessary for the rise of the democratic spirit. His religion was informed by a philosophy of equality, one that Alexis de Tocqueville later described as one that “proclaimed that all men are alike able to find the road to heaven.”

A few decades later, in Geneva, Switzerland, the austere John Calvin and sanctimonious others further advanced Luther’s break from papal supremacy, setting the stage for the puritanical Oliver Cromwell’s rupture from political authority a hundred years later. The Englishman Cromwell not only beheaded a king in 1649 and dramatically advanced the notion of a sovereign’s accountability to the people, but he also furthered notions of individual conscience as self-determination, attitudinal milestones on the pathway to democracy. Once an individual's religious rights had gained a foothold, it was a smaller leap from there to a belief in one's own political rights.

That men like Cromwell, Calvin, and Luther -- who shared much with those known today as fundamentalist Christians -- acted as forefathers of Jefferson, Madison, Locke, Montesquieu, and others in the pantheon of liberal democracy’s champions, comes as a bit of an irony. Europe’s centuries-long coalescing of the democratic spirit never was a straightforward path but rather one filled with hypocrisy, violence, and setbacks (Cromwell, for example, was a devout anti-papist who massacred thousands of Catholics at Drogheda and Wexford). Throughout Europe’s bloody history and the push-pull of revolution and counterrevolution, the forces of progress too often transmogrified into ones of empire, suppression, and violent authority. The 17th through the mid-20th centuries saw in Europe a long meandering trail of democratic startups and remissions, with the inexorable march gaining significant steam with the establishment of the American republic in 1789.

Finally, following World War II, with the continent in rubble, western Europe at long last managed to conquer its political demons: democracy gained firm footing in most of the western part of the continent, triumphing over centuries of monarchs, dictators, fascism, religious fanaticism, and the most barbaric of internecine wars. By the 1970s, the democratic spirit had spread to Greece, Spain and Portugal, and following the Berlin Wall’s collapse in 1989, it spread in rapid progression to the former communist dictatorships of east and central Europe.

Democracy’s future. While democracy can be noisy and messy, and can sometimes result in confusion and inefficiency, if implemented fairly with the right institutions the human experience shows that it is capable of fostering remarkable things. Democracy confers the advantage of popular legitimacy to a government, and is the best match for the animal spirits of capitalism since it allows the “genius of millions” to flower even as it harnesses that economic potential for the good of all. It’s not always perfect, of course; it was George Bernard Shaw who said, “Democracy is a device that ensures we shall be governed no better than we deserve.” And the details of specific institutions and practices are important, since in a true democracy the political system must rule over the economic, not the other way around.

In the current era, some see China’s “consultative dictatorship” as a new political model that is challenging the primacy of western-style democracy, but I think they are quite wrong. Over time China will also become more of a representative democracy, even China’s current leadership of president Hu Jintao and premier Wen Jiabao have made statements to that effect. China already holds more local elections than any other country in the world (though many of those elections don’t live up to western standards of fairness) yet progress at the national level remains slow. Chinese democracy undoubtedly will be a unique Sino version; one innovative proposal by a Chinese academic calls for a tricameral legislature, with members of the third house selected by Confucian standards of meritocracy. It's intriguing to contemplate China evolving into some sort of innovative democratic experiment, since even China’s highest leaders recognize that it’s no coincidence that most democracies have resulted in higher standards of living and a more broadly shared prosperity. Winston Churchill perhaps said it best when he groused, in characteristic fashion, “Democracy is the worst form of government -- except for all the others that have been tried.”

Better than China or any previous authoritarian government, a newly democratic Europe has been able to harness capitalism’s extraordinary ability to create wealth in such a way as to better support families and workers, and to foster a more broadly shared prosperity, ecological sustainability and a new type of quiet global leadership based on regional “peace and prosperity” partnerships. The European democracies, despite all their faults, have accomplished this more than even the American democracy (which badly needs to update its 18th century political institutions). These are truly outstanding achievements, historic even, and as I stand here under a bright blue Athens sky, gazing at the shards of what once was, I can’t help but marvel that it all began here, at the Agora, 2500 years ago.

Steven Hill 12:47 AM Permalink | Trackbacks
November 25, 2010
 by Steven Hill

ARRIVAL IN GREECE, EPICENTER OF THE (DEBT) EARTHQUAKE… As I arrived in the airport in Athens, it struck me that I had now been on the road for five weeks, and had trekked my way clear across Europe, from the far west to central to the far east. Greece was to be my next to last stop (Istanbul the final), and as I made my way past news stalls boasting racks of newspapers and magazines from every corner of Europe, with mastheads and headlines blaring as colorfully as the European currencies of old before the days of the drabber Euro, I reflected for a moment over the places I had visited on this journey.

I began my tour in Budapest, once the capital of a grand Hungarian empire which lasted nearly a thousand years. Then it fell to the Ottomans, followed by the Habsburgs, then formed half of another empire with the Austrians, lost 70 percent of its territory and a third of its people in the treaty settling World War I, fell under Soviet domination, staged an unsuccessful revolt against that domination, and covertly opened its borders to Austria in 1989 and accelerated the Soviet dominators’ collapse. Now it has settled into the wobbly life of a democratic but troubled social capitalist nation, slowly inching towards its new destiny at the geographic heart yet still at the economic periphery of a peaceful and prosperous yet itself newly formed union of European nations -- nearly all of whom had fought horrific wars against each other not that long ago.

From there I traveled to France -- a place that has been one of the world’s major powers for centuries and now is proudly trying to learn how to balance that rich history with its current possible futures. A place where there is evidence of human habitation going back hundreds of thousands of years. Vaguely familiar cave ancestors who, through a mysterious and unknown evolution, became the Gauls, the Celts, the Franks, the Romans, Charlemagne, Caesar, the Cathars, the Huguenots, the cardinals and Kings Louis, Henry and Charles, names that roll off the tongue like a schoolbook nursery rhyme. The Renaissance, the Protestant Reformation, the Enlightenment, French revolution, the hard-fought battles for ideals and principles which it turns out you can eat as surely as you can devour baguettes and brie -- and which quickly transmogrified into guillotines and Napoleon, the Thermidorian reaction, the swing back of the pendulum that is sharp-edged like the blade of the executioner’s ax that can take off your head if you don’t learn how to duck. That’s what has preoccupied everyday people for much of human history, learning how to duck, how to avoid the next capricious whim of the empire’s courtiers about to knock on your door. France’s tale, from beginning to end a major chapter of Western civilization, is a cautionary one, full of lessons that cannot be appealed to a higher court.

From France I had moved on to Belgium, the Netherlands, Sweden, Norway, back to France, then over to Germany, then Austria, then Italy. At every stop it was immediately apparent, in an almost visually surreal way, that each of these European nations has an emotionally-charged yet remarkable past, evidenced in the bricks and mortar of the many houses of history that still remain, the castles and churches, the towers and parliaments, the villages and ancient roads, still casting the same shadows over passersby as they did centuries ago. This is a past that stretches back so far into the human memory that it has become part of our DNA (DNA = Descendants ‘N Ancestors). The great historian Arnold Toynbee once wrote, “Countries have characters that are as distinctive as those of human beings,” and that is surely true, it explains why I see in my dreams nations that appear as immense individuals, as Olympian demi-gods that stalk the land lording over all the little people pulsating like the cells of these giant beings, with the tragedies , wars and crimes of passion akin to our collective domestic violence, the victories and treaties akin to our shared celebrations, the royal weddings that are our own matrimony to each other, the harvests and cornucopias of bounty our dinner table of plenty, the famines and droughts our depressions that rip apart the ties that bind, each national episode burned into “We, the Cells” and stored inside our collective carapace. To the extent that those of us of European stock all have psychic sinews that stretch backward into this grand and tragic past, we are all victims suffering from post-traumatic stress. It’s not only the lines of the map that have changed, but the lines in people’s minds. And we are left, we little people, to cope with it all as best we can.

So after leaving Rome, after taking leave of the skeletal architecture of that once powerful empire poking out of seven hills, and the imperious, pious grandiloquence of Catholic basilicas clothed in marble stolen from that empire’s ruins, I finally touched down in Greece, that most ancient of western lands, the cradle of what is known as “western civilization,” located far to the eastern skirt of the west.

Unlike the other countries I have visited where “the fear of the crisis has turned out to be worse than the crisis itself” (as one commentator told me), in Greece the impact of the economic crisis has hit like a small tsunami. My colleagues in Athens talked about declines in service, in the quality of health care and other dents in the Greek system that they had been experiencing. Large and militant protests had rattled the nerves of just about everyone. The government of Prime Minister George Papandreou had ordered sizable budget cuts and the layoffs of tens of thousands of public employees. The Greeks are in a complaining mood, for good reason, and so they bitched pettily that PM Papandreou, who hails from one of the two longtime ruling families that rotate in power and who had studied abroad most of his life (including in the U.S.), spoke better English than he did Greek. This is seen as an apparent indictment of sorts, even though his approval ratings remain remarkably high. Most Greeks acknowledge that some kind of change is necessary, so ambivalence has become the bitter brew that they all drink around the cafes and tavernas.

On the other hand, this is Greece we are talking about. The place still has gorgeous weather, stunning landscape and health care for all, spotty as it is (compare it to California, where a recent report found that 25% of Californians don’t have any health care, and where the unemployment rate is higher than Greece’s). One of the qualities holding Greece back from enjoying the benefits of a more modern economy is its reliance on an informal economy of family and social networks which too often translates into nepotism, back room deals and tax dodging. But during an economic crisis like this, those networks become valuable means of support so that people don’t fall so far through the cracks.

It’s easy to forget that Greece is a country that was plagued throughout the 20th century by bitter schisms between monarchists, democrats and communists, with dictators and elected governments rotating in complicated power alignments right up to the 1970s when the last military dictatorship withdrew and the monarchy was abolished. So while Greece is the ancient birthplace of demos kratia, its modern democratic incarnation is surprisingly young. Not paying taxes to the corrupt honchos who ran things for so long and relying instead on an informal sector of family and social networks became the fiber holding it all together, a well-founded Greek tradition, even celebrated nostalgically in films like Zorba the Greek.

During the crisis, those networks can act as a safety net; longer term, they will prevent the modernization of Greece because in a modern economy designed to provide for a mass society you have to be able to count things: revenues, expenditures, imports, exports, surpluses and deficits, these things have to be tracked as accurately as possible. But if everything is being done hush-hush, on the sly, in backrooms, without receipts or records, stored in cookie jars, under mattresses, in brassieres and petticoats, with a bit of payola in the right palms for looking the other way (“there’s your ‘tax’”), you can’t count anything. You can’t be sure of how much your government has to spend because you can’t be sure how much revenues it has taken in. So you just make up figures and hide that too, deficits become surpluses with a few whisks of the computer mouse. That got Greece into a heckuva lot of trouble last year when it was discovered that its budget deficit was much larger than it had disclosed, and suddenly the bond markets got spooked and turned and attacked.

But it’s not only that the previous government was using the services of Goldman Sachs and others to hide its debt, but that in Greece there is a long-standing tradition of doing everything with a wink and a nod. And that “system” pervades at every level of society, right down to the neighborhood and household levels. In that way it shares much with the corrupt housing mortgage system that came to pervade America, from Main Street to Wall Street, from your local bank handing out mortgages people couldn’t afford to the large investment banks taking those mortgages and bundling them into derivates and credit default swaps and reselling them again and again until they became seeded like “financial weapons of mass destruction” (as Warren Buffet called them) throughout the global financial system. In both Greece and America the dysfunctional systems provided economic stimulus for a time, with nearly everyone sucking from the teat -- until the house of cards came crashing down. Yes, Greece and America have more in common than Americans want to believe, and I don’t just mean that both have large budget deficits. It’s actually far worse: both Greece and the U.S. have development models that no longer work. Yes, in many ways America is just a bigger Greece.

But that needs to change if Greece is going to have any chance of not only solving its current debt dilemmas but also of developing into a modern economy. I met with many Greek officials, including journalists, a deputy minister of the Papandreou government, and finally I interviewed Prime Minister Papandreou himself. I consistently emphasized this message to them, that “It’s important in a modern society that you’re able to count things;” I gave a speech at the Greek Foreign Ministry (which is like their Secretary of State) and articulated this viewpoint there as well (see an article from the Athens press about my FM talk, linked here, but it’s in Greek so you will need to have your Google translator turned on). I think they get it, my interview with Papandreou was extremely interesting. He has a vision not only for the immediate crisis but for a new Greece (more on my interview with PM Papandreou in a future post). Yet the old Greece has deep roots, like weeds and crabgrass, and it is not going to be that easy to dig them up.

Steven Hill 11:25 PM Permalink | Trackbacks | Comments (1)
November 22, 2010
 by Steven Hill

MERKEL, GERMANY, OVERTHROW OBAMA, U.S., AT G-20...I wrote an oped that was published recently in the International Herald Tribune/New York Times. The media missed what really went down at the Group of 20 meeting in Seoul, South Korea. That meeting has emerged as a game changing moment. Not only did President Barack Obama suffer a loss of face, but America’s economic leadership took a major hit. Following America’s catalytic role in bringing the global economy to the brink of disaster, and waging two wars in the Middle East that have revealed military mediocrity more than strength, followed by the Obama administration’s weakened political position after the November 2 election, the U.S. now is losing the global argument over the best development model for the 21st century. The "Washington consensus" appears to be dead, or certainly on life support.

Read more about it my oped, linked below:

Germany Speaks Out
International Herald Tribune/New York Times

Steven Hill 4:43 AM Permalink | Trackbacks | Comments (3)
November 19, 2010
 by Steven Hill

THE MYTH OF THE OVERTAXED EUROPEANS AND OTHER MODERN FABLES… I’m always amazed at the stereotypes about Europe that so easily roll off the tongues of Americans: Europeans are socialists, they have weak, noncompetitive economies, their populations are dying off, they are being overrun by Muslims, the list goes on and on. One of the most prevalent stereotypes is that the poor Europeans are overtaxed serfs. I ran into this stereotype in the form of a know-it-all American who happened to attend one of my lectures in Berlin. He tried to contest some of my observations, and raised the tax bugaboo. “‘No taxation without representation’ Americans would never pay taxes as high as Europeans pay,” he said.

Americans like him always give me a chuckle. They sound so dogmatically sure about things, even when they don’t know much about the subject. I remember attending a seminar in Washington DC along with a couple dozen Members of the European Parliament (MEPs) who invited several members of Congress to participate in their discussions about the global economy, the recent crisis, and the role of China. This one member of Congress, a Republican from Virginia, showed up and rather than participating in a broad discussion along with everyone else seated around a large table, instead he stood to command the floor and proceeded to hold forth. He lectured the MEPs, and the sum total of his erudition was that the problem with China is that -- ready for the punch line? -- it does not have freedom of religion. Say what? These MEPs, all of whom were highly educated people, who speak at least three or four languages, some of whom had been freedom fighters behind the Iron Curtain during the struggle against communism, sat there with eyebrows raised. I sat there holding my breath, mortally embarrassed for my country.

So at my talk I suddenly was confronted by this latest example of the breed, standing in front of me, an American guy smiling out of context, grinning apropos to nothing, over his insistence that Europeans pay so much more in taxes than Americans. So I replied to him, perhaps a bit testily.

“Actually, if you break it down, Americans pay out just as much as Europeans do, we just get a lot less for our money. The fact is, in return for their taxes, Europeans are receiving a generous support system for families and individuals for which Americans must pay exorbitantly, out-of-pocket, to enjoy the same level of support. That includes quality health care for every single person, the average cost of which is about half of what Americans pay even as various studies show that Europeans achieve better results, health-wise.

“But that’s not all. In return for their taxes, Europeans also receive affordable child care, a decent retirement pension, free or inexpensive university education, job/skills training, paid sick leave, paid parental leave, ‘kiddie’ stipends after the birth of a child, generous vacations, affordable housing, senior care, efficient mass transportation and much, much more. To get the same level of benefits as Europeans, most Americans fork out a ton of money in out-of-pocket payments -- in addition to our taxes. Either way, you pay. Yet that factor is never considered when they start figuring out who’s paying out more to receive what services.”

Elaborating further, I told him that, for example, many Americans are paying escalating health care premiums and deductibles (and of course 50 million Americans don’t have any health insurance at all -- a travesty from the European point of view). Not that long ago, Anthem Blue Cross announced that its individual premiums were going to increase by up to 40 percent, and people are going to pay for that out-of-pocket. Many Americans are paying higher deductibles in order to reduce their premiums; I have a friend who bought a health care policy for his family of three children with a $10,000 a year deductible in order to keep his premiums affordable. But Europeans receive health care in return for a modest amount deducted from their paychecks.

Friends have told me they are saving nearly $100,000 for each of their children’s university education, and most young Americans graduate with tens of thousands of dollars in debt (unless they happen to be independently wealthy). But European children attend university for free, or nearly so, depending on the country.

Child care in the United States costs more than $12,000 annually for a family with two children. In some countries in Europe, child care is free. In others, they pay $1000-$2000 per year, depending on their income. So they are paying at most only one-sixth of what Americans are paying -- and the quality is far superior.

Millions of Americans are stuffing as much as possible into their IRAs and 401(k)s because Social Security provides a measly amount towards retirement -- only about 35 percent of one's final salary, which is not enough income for a comfortable retirement. The more generous European retirement system provides 70 percent to 80 percent of one’s final salary (depending on the country), and does a much better job of ensuring that seniors don’t suffer a drop in their living standards. That’s more money that Americans have to save out of their own pockets.

Americans’ private spending on old-age care is nearly three times higher per capita than in Europe because Americans must self-finance a significant share of their own senior care by paying out of pocket. Americans also tend to pay more in local and state taxes, as well as property taxes. Americans also pay hidden taxes, such as $300 billion annually in federal tax breaks given to businesses that provide health benefits to their employees -- that’s $1000 for every man, woman and child in the United States

“When you sum up the total balance sheet,” I told him, “it turns out we Americans pay out just as much as Europeans, perhaps more. Because we pay a lot more out-of-pocket, even as we receive a lot less service for our money.”

Unfortunately, these sorts of complexities are not calculated into simplistic analyses like Forbes’ annual Tax Misery Index, a ‘study’ that purports to show that European nations are the most ‘tax miserable.’ Sure enough, there are the European countries at the top of the list, while down there near the bottom, happy as a clam, is the United States right next to Indonesia, Malaysia and the Philippines. That’s because the Forbes Tax Misery Index only takes into account income tax, Social Security or retirement tax, sales tax or VAT and a few other minor taxes. It doesn’t consider the vast amounts that Americans are paying out of pocket, nor what people are receiving in terms of supports for families and individuals.

Ideologically-bound Americans counter that, at least in the U.S. it’s discretionary about whether or not you purchase these services, the government isn’t picking your pocket through higher taxes. But in this economically insecure age, these kinds of services increasingly are necessary to ensure healthy, happy and productive families and workers. Who doesn’t need health care, higher education or some kind of skilled job training, child care, retirement, senior care? Yet because the Europeans collect the necessary revenue via taxes, they can create all these pools of social insurance -- healthcare, childcare, university education, etc. -- in a way that allows them to plan better and create more cost-effective systems, to reach certain economies of scale with built-in efficiencies. That allows them to offer these services for a lot less money per person than we can offer them in America, with our very decentralized, hodgepodge systems that can’t reach economies of scale and therefore are much less affordable. That’s why Americans pay more per capita for health care, child care, university education and so much more.

So Europeans receive these supports for families and workers at an affordable price, but most Americans do not, unless you pay a ton of money out-of-pocket, which many hard-working Americans can’t afford. Or unless you are a member of Congress, which of course spare themselves nothing and provide European-level support for themselves and their families.

Interestingly, an American acquaintance of mine who lives in Sweden told me that, quite by chance, he and his Swedish wife were in New York City once and ended up sharing a limousine to the theater district with one member of Congress, a U.S. Senator and his wife. This Senator, a conservative, anti-tax southern Democrat, asked my acquaintance about Sweden and swaggeringly commented about “all those taxes the Swedes pay.” To which this American replied, “The problem with Americans and their taxes is that we get nothing for them.” He then told the senator about the comprehensive services and supports that Swedes receive.

“If Americans knew what Swedes receive for their taxes, we would probably riot,” he told the Senator. The rest of the ride to the theater district was unsurprisingly quiet.

Yet that kind of silence only serves to perpetuate this myth and prevents Americans from understanding the vast shortcomings of our own system, which is a real shame. Americans don’t realize how far we have fallen behind our international counterparts because our sense of national identity is clouded in such myths and stereotypes.

Steven Hill 9:21 PM Permalink | Trackbacks | Comments (5)
November 13, 2010
 by Steven Hill

AMAZING GERMANY…DECLINING UNEMPLOYMENT…HOW DO THEY DO IT?...The Wall Street Journal reported not that long ago that Germany is benefiting from its lowest unemployment in 20 years. The Organization for Economic Cooperation and Development (OECD), which uses harmonized unemployment rates (the same methodology for all countries) reports Germany’s unemployment rate at 6.7percent (in the United States, unemployment has climbed to 9.6 percent). What is as impressive as the low unemployment rate is that in Germany unemployment actually has declined since the start of the economic crisis, whereas in the U.S. unemployment has nearly doubled. It used to be that U.S. pundits and economists would wag their fingers and shake their heads disapprovingly at Germany, calling it “weak,” “sclerotic,” an “old man,” and “the land of double digit unemployment.” For years, Germans and other Europeans had to withstand snide economic lectures from the Americans. But now the shoe is on the other foot: Germany, which is the world’s fourth-largest national economy and second largest exporter (perhaps the leading exporter, it’s hard to know if you can trust China’s numbers), now is leading the U.S. Yet neither the U.S. media nor policymakers have examined closely this Deutschland miracle. It’s as if we are determined not to learn from anyone else, because if you admit you have something to learn then you also have to admit that you are not the best. And if there’s one thing that Americans like to be, it’s the best.

So how has Germany done it? How has it managed to dramatically drop its unemployment rate in the middle of the biggest economic crisis in 80 years? The answer is that the government of Chancellor Angela Merkel not only pursued different economic policies than the Obama administration, but Germany also has a greater degree of economic democracy than the U.S. Indeed, Germany has essentially reinvented the modern corporation, and yet very few Americans are aware of it. These differences have given Germany a dramatic advantage.

Kurzarbeit/short work. The first of these policies is called Kurzarbeit, or “short work,” in which, instead of laying off millions of German workers, firms trimmed the hours of all employees. Workers were cut back to, say, 90 percent of full-time, but would still receive 95 percent of pay with most of their lost wages being made up from a special fund squirreled away by the government during more prosperous times. In essence, instead of the government and employers paying unemployment benefits to laid-off workers, they paid to keep workers at their jobs, but at reduced hours. It was a brilliant strategy, producing a win-win-win. For workers, having a job that has been reduced to 90 percent of full time is vastly better than being unemployed, as it keeps them engaged in the workforce and puts far more money in their pockets than if they were living on unemployment alone. For employers, it keeps the workforce intact and ready for an economic upswing. And for the government, supporting a worker whose hours are reduced is much less costly than paying full unemployment benefits.

Furthermore, with more Germans having money in their pockets, it lessened the decline in consumer spending which is one of the primary drivers of the economy. Finally, the policy prevented the utter devastation that occurs to families and communities when the primary breadwinner is laid off, along with the increase in social ills that accompany lay-offs such as home foreclosures, alcoholism, drug addiction, and domestic violence that results from the stress of unemployment. Despite the many concrete benefits of this policy, when Larry Summers, one of Barack Obama’s closest economic advisers, was asked why the president didn’t pursue short work to stem the economic bleeding, he dismissed the idea, saying the White House wanted to create new jobs, not preserve old ones (as if there’s a conflict between the two!).

Co-determination and economic democracy. Beyond its short work policy to respond to the immediate economic crisis, Germany has evolved over several decades one of its greatest contributions to the global economy -- a degree of economic democracy. Institutions that are unfamiliar to Americans, with obscure names like co-determination, supervisory boards and works councils, have been crucial in helping to harness German capitalism’s tremendous wealth-creating capacity so that its prosperity could be broadly shared. This is one of the pillars of Europe’s “social capitalism” which has proven to be more stable and efficient than America’s “Wall Street capitalism.”

To understand codetermination, it’s helpful to contemplate the following questions: The corporation, even with all its considerable warts, is the greatest wealth generator that humans have ever devised, but its success raises the questions: Who gets to control that wealth? Whose pockets should the wealth flow into? Codetermination is Germany’s response, and it is a potent one.

Co-determination has several features, one of which allows workers in a corporation to elect a certain percentage of that business’ board of directors. Known as supervisory boards, they then oversee company managers, who handle day-to-day operations. In Germany, fully half of the boards of directors of the largest corporations--Siemens, BMW, Daimler, Deutsche Telekom and others -- are elected by workers. To understand the significance of this, imagine the impact if Wal-Mart were legally required to allow its workers to elect half of its board members, who would then oversee the CEO. Imagine how much that would change Wal-Mart’s behavior toward its workers and supply chain. It’s hard for Americans even to conceive of such a notion; indeed, when I ask Americans at my lectures how many of them have heard of worker-elected supervisory boards, usually no hands go up. Yet most European nations employ some version of this as a regular feature of their economies.

The impact has been impressive. Klas Levinson, a researcher for the former National Institute for Working Life in Sweden, is one of the world’s experts on co-determination. He has studied Sweden’s codetermination extensively, where workers get to elect a third of the company’s board of directors. A few years ago I met with Levinson at the institute’s Stockholm headquarters, a sleek glass structure with the air of a university campus. “Co-determination is Europe’s little secret advantage,” he told me. “The idea that elected worker directors should sit side by side as equal decision-makers with stockholder representatives, supervising management, is a little-known yet unprecedented extension of democratic principle into the corporate sphere.”

Levinson’s research shows that employee representation on corporate supervisory boards, contrary to fears that it would cause tension or render decision-making too cumbersome, has actually fostered cooperation between management and workers. This, in turn, has benefited the businesses as well as the workers. Workers have input, even into important decisions, so companies are less plagued by labor strife and internal schisms. And workers are well compensated, with high salaries and the most generous social support systems in the world.

One of Levinson’s studies of Swedish businesses found that two-thirds of executives viewed co-determination as “very” or “rather” positive, because it contributed to a positive climate, made board decisions “deeply rooted among the employees” and facilitated implementation of “tough decisions.” Eight of ten chairmen were satisfied with the arrangement and felt it was not important to reduce worker representation. An E.U. directive establishing a continent-wide framework for board-level employee representation went into effect in October 2004, firmly rooting supervisory boards in Europe’s economic culture.

The other pillar of Germany’s co-determination is known as works councils, which are just what the name implies -- elected councils at businesses, through which employees gain significant input into working conditions. Works councils, which are separate from labor unions but often populated by trade unionists, have real clout. They enjoy veto power over certain management decisions pertaining to treatment of employees, such as redeployment and dismissal. They also have “co-decision rights” to meet with management to discuss the firm’s finances, work and holiday schedules, work organization and other procedures. In addition, they benefit from “consultation rights” in planning the introduction of new technologies and in mergers and layoffs, as well as in obtaining information useful in contract negotiations, such as profit and wage data. German labor law stipulates that factory-wide workers’ assemblies must be held at least four times a year, at which a management representative must report on the plant and the business. The head of the works council also reports, and workers use these assemblies to promote their views and, if necessary, criticize company decisions in front of management.

In 1994 the E.U. issued a pioneering directive on works councils, stipulating that every multinational with at least 1,000 workers, and at least 150 workers in two or more EU nations, must negotiate agreements with works councils. Other nations have supplemented that directive by requiring councils in every workplace. Studies by Princeton’s Jonas Pontusson and others have concluded that works councils contribute to efficiency by improving communication, which in turn improves the quality of decisions and legitimizes decisions in the eyes of workers. The studies also found that works councils are associated with lower absenteeism, more worker training, better handling of grievances, and smoother implementation of health and safety standards. It turns out that when workers are given a degree of consultation, it makes them more satisfied and more productive.

Co-determination has proved crucial to Europe’s economic success and its broadly distributed wealth. “The practical effect of co-determination,” says Levinson, “is that corporate managers and executives must confer extensively with employees and unions about a range of issues, even about the future direction of the company.” Co-determination reflects European social capitalism, with its communitarian values and emphasis on manufacturing, much the way huge executive bonuses, quarterly earnings and a bloated financial sector reflect America’s Wall Street capitalism.

Germany has been the most important leader in developing European-style social capitalism. That social capitalism has both produced and benefited from a broader “culture of consultation,” which has also contributed to the creation of cooperatives (like at Mondragon in Spain) and resulted in a vibrant small-business sector that produces two-thirds of European jobs, compared with only half of U.S. jobs. Indeed that culture of consultation, fostered by practices like codetermination (both works councils and worker-elected boards of directors), can take substantial credit for Chancellor Merkel agreeing to adopt Kurzarbeit/short work.

Allied Powers after WWII “punished” Germany with economic democracy. Interestingly, the conquering American military in World War II can take some credit for co-determination. After the war a group of prominent German economists, led by future chancellor Ludwig Erhard, Walter Eucken and others, proposed what they called the “social market economy” in the belief that the market should serve broader social goals. And it was conservative Christian Democrats, not the leftish Social Democrats, who introduced this idea. The Allied powers encouraged this line of thinking, since it decentralized economic power, shifting it away from the German industrialists who had supported the Nazi war effort. In effect, U.S. planners “punished” postwar Germany with economic democracy as a way of handicapping concentrated wealth and power, helping to birth the most democratic corporate governance structure the world had ever seen.

In the decades after Germany’s launch of social capitalism, co-determination spread throughout Europe; it has been adopted in most of the new E.U. member states from Central and Eastern Europe. These distinctly European advances may be the most important innovations in the world economy since the invention of the modern corporation. They encourage both free enterprise as well as a degree of economic democracy and worker consultation that does not unduly burden entrepreneurship and commerce. These advances allow businesses to be both competitive and socially responsible. Sixty years after its genesis, co-determination is a core element of the European economy, and it distinguishes Europe’s social capitalism from America’s Wall Street capitalism.

In effect, Europe, led by Germany, has reinvented the corporation. Yet the latest critiques of capitalism by leading authors like Naomi Klein, Noam Chomsky, and the producers of the popular film The Corporation tend to view all corporations and all capitalisms as the same. American progressives, while searching for effective responses to globalization, appear to be mostly unaware of these intriguing European inventions. Movements to revoke the charters of offensive corporations, while having gut-level appeal, have failed to recognize that European corporations are fundamentally different animals from their “disaster capitalism” U.S. counterparts. When I asked a leading globalization critic from the Economic Policy Institute his opinion of co-determination and works councils, he replied dismissively, “Bah, those just lead to company unions,” a demonstrably false claim. And of course, the American right rejects co-determination as socialism incarnate, ignoring its potential to renew capitalism and support real family values.

“Mr Blair, we still make things.” Another factor in Germany’s economic success has been that is has continued to emphasize manufacturing and industrial policy over the financial industry. German chancellor Angela Merkel once was asked by then-British prime minister Tony Blair what the secret was of her country’s economic success, which includes being the world’s second largest exporter and running substantial trade surpluses in recent years. She famously replied, “Mr Blair, we still make things.” Harold Meyerson, Washington Post columnist, has explained further. “In Germany, manufacturing still dominates finance…German capitalism didn’t succumb to the financialization that swept the United States and Britain in the 1980s” (though Germany’s banks and financial sector did get snared in the Wall Street web).

This focus on manufacturing, as well as on quality and long-term performance over short-term gain, is precisely what is reinforced by Germany’s codetermination. By giving workers a sizable stake in the health of companies and the economy in general, a symbiotic relationship lumps everyone into the same boat. A rising or ebbing tide affects everyone together.

So when assessing the Obama administration’s performance in getting this economy going again, remember that the remarkable resilience of the German economy is directly attributable to shrewd policies and more efficient institutions that have been pursued and that have better stimulated its economy. The Obama administration also could be pursuing these policies and institutions, but it has declined to do so.

Steven Hill 11:13 PM Permalink | Trackbacks | Comments (8)
November 9, 2010
 by Steven Hill

SO HOW’S EUROPE DOING? AN UP CLOSE LOOK…One of my goals during this trip has been to assess the impact of the economic crisis in those parts of Europe I am visiting, which by the end will amount to 12 different countries. Is the highly vaunted European social capitalism, which has provided so well for families and workers even as it has cut its carbon emissions to half that of the US, in danger of erosion?

If it were possible to sum up what I have heard and observed, the most telling comment was made by, curiously enough, an American living for many years in Slovakia. I was chatting with him in the Frankfurt airport after both of us got bumped from our flights due to a screw-up by Lufthansa Airlines (which is usually so efficient). While cooling our heels awaiting a rebooking, we fell to talking. I asked him about the impact of the economic crisis in Slovakia, and Europe in general, and after pausing thoughtfully he replied: "The fear of the crisis has turned out to be worse than the crisis itself." Indeed, in France, Germany, Sweden, Italy and most of the other countries I have visited, the economic crisis has nibbled away at the edges of everyday people's lives but it has not bitten into the bone. Not by a long shot. Certainly there is worry, and a degree of pessimism setting in, but the Germans and the French in particular tend to be pessimistic people anyway, in my experience. Unemployment in most places has remained at manageable levels, and people still have their very generous (by American standards) workfare supports for families and individuals to shield them. These supports really are both a material as well as psychological comfort during times like these, as well as they provide ongoing consumer stimulus to the broader macro-economy.

So the overall picture is it mixed one, yet that nuanced snapshot is not what you read or hear day after day from the mainstream media in the US. The New York Times recently published a series of short interviews called "The Austerity Zone: Life in the New Europe" in which viewers get to listen to the plaintive personal stories of woe from a handful of people from Greece, Spain, Britain, Germany and France. The Times also wrote recently that, “Whether in Spain, France or Italy, European nations remain saddled with heavy welfare obligations — ones that inevitably must be curtailed to meet ambitious deficit targets, even as their tax revenue is constrained by low economic growth.” Yet I have seen another story playing out here, one that is more complex and laced with silver linings as well as green shoots of recovery. But it does vary from country to country, just as economic recovery in the US varies from state to state. And the fear of the future continues to hang like a specter over the continent, as the biggest impacts of the deficit cutting measures being enacted by most governments won’t be felt until 2011 sometime. So that creates a degree of uncertainty that is feeding the pessimism.

Here’s a country by country breakdown of the countries I have visited:

Germany. Europe’s leader and economic engine, Germany is one of the few countries where the unemployment rate actually has declined during this economic crisis to an 18 year low of 6.7 percent (in the US, unemployment has nearly doubled during the crisis to 9.6 percent, according to the OECD’s harmonized unemployment rates). Germany’s exports have soared over the past year, providing a sizable trade surplus and leading the way to its still fragile economic recovery. In the last month and a half I have visited Berlin, Munich, Frankfurt and Heidelberg. Munich, Frankfurt and Heidelberg all seem to be doing fairly well, based on my talks with public officials, elected leaders, as well as people in the street, shopkeepers and taxicab drivers. Here and there you see a vacant shop window, yet several shopkeepers told me that things are better this year than last. In Berlin, which has long been poorer than the rest of Germany due to its point position in integrating the formerly communist East Berlin/East Germany, some of the people I talked to complained about cutbacks in city services, a decline in health care quality, and having less disposable income in their pockets. But the amount of homelessness and begging on the streets is still minor compared to any similar-sized U.S. city. Even with their cutbacks, the average Berliner still has a lot more to fall back on than the average American, in terms of the types of supports that people need today in this economically insecure age.

Luxembourg. I had never visited this small, wealthy country before, it’s the size of Rhode Island with as many people as Wyoming or the District of Columbia. It has the world's highest GDP per capita and an unemployment rate of only 5 percent. It benefits greatly from location, as it is surrounded by Germany, France and Belgium, and workers as well as shoppers from these three countries pour into the capital city Luxembourg on a daily basis to take advantage of still-thriving businesses and fine shopping opportunities. It also benefits from many good government jobs, as it is the seat of the European Parliament's secretariat, as well as the European Court of Justice, the European Court of Auditors, the European Investment Bank and several departments of the European Commission. A former walled city, today it is a quintessential European city filled with a German-style industriousness that mostly seems unfazed by the economic crisis that they see as happening somewhere else.

Netherlands. I only visited Amsterdam, but it seemed to be its usual pulsating self. The restaurants, bars, cafes, pot shops, and plazas were teeming with people. No one I spoke with seemed to think the crisis was biting too deeply. One friend who was unemployed was in no rush to find work; he was “weighing his options” and seemed to think that when he was ready, jobs would be available. Unemployment rate: 4.4 percent (less than half that in the US, which is at 9.6 percent unemployment).

Belgium. I was in Brussels for only a few days, which is probably not representative of the rest of the country since it has a huge number of permanent jobs resulting from its status as the seat of the European Union and other international organizations. Belgium's unemployment rate has increased during the economic crisis from about 8 percent to 8.7 perent, and people I spoke with said that the crisis had made people tighten their belts more. But on the whole, rush-hour traffic jams were still hellacious, usually a good sign that tons of people are commuting back and forth to work.

Sweden. Like Germany, Sweden is another country that has pulled through the economic crisis in fairly decent shape. It didn't have a hyperventilating housing market like the US (and Spain, Ireland and Britain), so it has not suffered the same degree of economic ravaging. And Swedes have an excellent support system for families and workers, which results in consumers having more money in their pockets which helps drive the macro-economy. For example, the people giving me my ride to the airport to catch my flight to Oslo happened to be heading out of town on vacation. In addition to receiving paid vacation (i.e. regular full-time salary while on vacation) the government deposits into their banking accounts a vacation bonus to make sure they have enough money to enjoy themselves. Talk about a "vacation nation!" The unemployment rate is about 8.2 percent, which actually is a tad lower than before the start of the economic crisis. But things around the edges are sufficiently anxiety-producing that for the first time in Swedish history a populist, far right party squeaked above the 4 percent threshold necessary to win seats in the national parliament. This of course threw the justice-loving Swedes into a bit of a tizzy, an overreaction to a fairly typical occurrence during economic downturns, i.e. the rise in popularity of populist parties (see my previous comments in this blog on the recent rise of "far right" populist parties in Europe which, in many ways, are to the LEFT of the Democratic Party in the United States).

Norway. What can you say about a country that, in the midst of a global downturn, has a 3.3 percent unemployment rate? If you have a lot of oil reserves, like Norway does, recessions are events that mostly happen somewhere else. Oslo is a jewel of a city, perched on a glistening fjord, and a land of winter sports, sculpture (including the amazing Vigeland sculptures, written about elsewhere in this blog), Henrik Ibsen, Edvard Munch and Norse hardiness. The people I spoke with didn't think the recession had been much of a factor there.

Austria. Its unemployment rate has barely changed during this economic crisis, still at 4.5 percent, less than half the U.S. unemployment rate. Indeed, this Alpine studded jewel seems to have barely noticed the economic recession. There are signs of the downturn here and there, including a sizable increase in popularity of the populist Freedom People's Party during the municipal elections in Vienna to 27 percent of the seats (written about elsewhere in this blog). But construction cranes seem to lord over several parts of the city, including at the site of a massive new central train station funded in part by European Union money. Salzburg, several hours to the west near the German border, remains a quintessential European fairyland, a place that time passes by leaving it in a time warp of prosperity and healthy Austrian living. However looming on the horizon across Austria, especially in Vienna, is the slow but steady rise in the ethnic population, especially Muslim Turks, with all the tensions and challenges that implies.

Hungary. In Budapest, the largest city in Hungary with nearly two million people, the post-crisis situation appears fairly “EU normal.” I don’t see any obvious signs of deep recession, i.e. numerous shops vacant, more homeless people, empty cafes, restaurants and bars. Quite the contrary, these seem quite full and teeming; I was in Budapest a year ago and I don’t detect any obvious differences between last year and this year. But looks can be deceiving, so I chat with a few shopkeepers, people in cafes, my taxi driver, a bartender (most of whom speak decent English), and some Hungarian politicians at the conference I attended. The consensus seems to be that the crisis was worse last year, that this year things are better. But certainly not all better, unemployment has increased since the start of the crisis from 8 percent to about 11 percent. In 2008 it became the first EU country since the UK in 1976 to take a bailout from the International Monetary Fund. But as one of the politicians tells me, “In Hungary, people are philosophical about it. As crises go, compared to what Hungary (a formerly Communist country) has seen in the past, this has not been a big one.”

France. Yes, protesters are in the streets nearly everywhere. I witness a slow, dirge-like labor march in Toulouse, and a protesting parade of roller bladers in Paris (see more on the latter elsewhere in this blog). I also visit the working-class port city on the Mediterranean, Marseille, France's second-largest city with about 1.6 million people; the sun-splashed tourist city of Nice; the rural town of Lautrec outside Toulouse; and the European Parliament home in Strasbourg, near the German border. Despite the image of France exploding with labor strife, in every place I visited things look pretty "EU normal." In the bigger cities there are a few vacant storefronts here and there, and its unemployment rate has increased from 7.8 percent before the economic crisis to about 10 percent today (not that much higher than U.S. unemployment at 9.6 percent). But the protests and strikes to me seem like a healthy response to a fear that this economic crisis will be used by wealthy interests to erode France's social capitalism model. The front lines of that battle right now has been over the recent increase in the retirement age, which in actual fact only brings it more in line with other countries like Germany and the US. But the French wonder, "Why aren't more Americans out of the streets defending their social contract?" I couldn't agree more.

Italy. It's hard to say with Italy, I only get to Rome, one of my favorite cities anywhere, and the Eternal City of the Seven Hills has always had its rougher edges, more panhandlers, more pesky motor bikers spewing exhaust, less tidiness than the Germanic countries. But things don't look any different to me than the last time I was here before the economic crisis, though unemployment certainly has increased, from 6.8 percent to 8.3 percent. One interesting experience seems worth noting: I gave a lecture at a center-right policy institute there called Fondazione Fare Futuro and the audience is a high level one, with some elder statesmen in attendance who have been advancing the cause of the EU within Italy for decades. These old war horses make impassioned statements about the declines they see around them and their fears over the future. But afterward I went out to dinner with five younger Italians, thirty-somethings, who attended my lecture. I asked them about the gloomy statements of the elders of their organization, but to my surprise they just laugh it off. "Oh, those old people, they are always sounding like that. They are gloomy by nature.” They shake their heads and say that they think Italy and the EU, on the whole, are doing just fine. Their optimism is refreshing, the pasta and red wine absolutely delicious, and by my estimation Rome still maintains its position as one of the world's great cities.

The previous year, in August 2009, I had been in Slovenia, Croatia, Slovak Republic and Hungary. A listlessness was evident in the Slovak Republic, no doubt stemming from its 12 percent unemployment (as high as California's). Slovenia's unemployment stood at 6 percent and Ljubljana still retained the vibrancy of a quintessential European capital, but this year its unemployment climbed to over 7 percent. Unfortunately I did not get to three of the so-called PIIGS countries, Spain (20 percent unemployment, the highest in Europe), Ireland (14 percent unemployment), or Portugal (10.5 percent unemployment). Nor did I travel to the UK, where unemployment has climbed from 7 percent to 8 percent and conditions appear to be fragile, as the new Conservative-led government there prepares for drastic cuts in public spending.

But on the whole, I found the parts of Europe where I traveled to be coping reasonably well, considering that we are in the middle of the worst economic downturn since the Great Depression. But next, I am heading to Greece, the epicenter of the PIIGS sovereign debt crisis earthquake, where I will be giving lectures and interviews to the media, and will have a chance to interview Prime Minister George Papandreou -- from the top of the Acropolis!

Steven Hill 5:42 PM Permalink | Trackbacks | Comments (2)
November 5, 2010
 by Steven Hill

OSLO’S ASTONISHING VIGELAND SCULPTURES -- A CELEBRATION OF HUMAN BODIES AND THE CYCLE OF LIFE…In Oslo, unfortunately, I ran into some bad weather in the form of steady rain and the first cold breaths of winter coming on. But that did not prevent me from having a revisit with the amazing Vigeland sculptures located in Oslo’s Frogner Park. The Vigeland sculptures are the apotheosis of a distinctly Scandinavian sensibility regarding health and human bodies. Oslo is a land of sculpture, and every park, many street corners, even private dwellings, seem to be studded with sculptures, old and new, traditional and modern, with a fair number of them showing naked figures, reflecting the Norwegian sentiment that reveling in the flesh is a sign of health, not license. This refreshing esteem for human bodies shorn of pretense and artifice is expressed in surprising ways.

One day in Oslo I saw the front page of a daily newspaper with a huge color photo showing ten bust-baring, smiling women. But this was not a Hugh Hefner product or a Rupert Murdoch, page-three cheesecake photo, like those that marinate many British dailies. No, most of these women were at least sixty years old, many of them older and wizened. A new form of erotica for the elderly, I wondered? Hardly. Each of the women was missing one of her breasts. All of them were breast-cancer survivors who were unabashedly sharing their stories during a week of breast-cancer awareness. And their topless group photo was right there on the front page of a major daily newspaper, surgical scars and all. These modern-day Amazons smiled into the camera unashamedly, fearlessly, because health and naked bodies are Norwegian values that are inextricably entwined. There is something about it that smacks one as being very balanced, sane, and, well, healthy.

The Vigeland sculptures are the pinnacle of these cultural representations of health and the human body. My first encounter with the Vigeland sculptures several years before had been near to a religious experience, basking in the presence of genius. My return visit accompanied by my Oslo friend Chris Skovsgaard did not disappoint, despite having to view everything through a veil of rain and from under the dome of a large umbrella.

The park contains 192 separate sculptures with more than 600 human figures, all life-size or larger, by the brilliant sculptor Gustav Vigeland. Vigeland expertly rendered his human figures, casting them into bronze or carving them in granite, over a period of nearly four decades, between 1907 and 1942. The outstanding signature of his monumental body of work is the way the hundreds of sculpted men, women, and children are portrayed in various stages of life—male and female adults, young adults, adolescents, toddlers and infants, even a fetus, and finally the elderly and a decomposing skeleton of death. The entire cycle of life is represented, from birth through adolescence through maturation to demise, in all its multiple joys, sadness, and eternalness. All of the sculptures are naked, not a stitch of clothing on any of them, yet the display is modest and appropriately engaging, not lurid in the least. The females are sturdy and solid, the males robust but tender. Male and female genitalia are in abundance. The figures are frequently clustered together in allegorical groups, showing adolescents playing leapfrog, or a mother and father with their child, or a mother with her son or a father with his daughter; or two bodies linked in a sort of yin-yang apposition, or two lovers in a state of bliss, foreheads touching tenderly, and another two lovers in a state of conflict.

Some of the figures are arrayed around a large, grand fountain portraying the cycles of our lives, others line up evenly on either side of a bridge. Still others are scaling a giant granite obelisk jutting into the sky, and they are writhing but not in despair, unlike those in Rodin’s Gates of Hell, instead there is a sense of togetherness, of carefully supporting one another, on their way toward some kind of resurrection or salvation at the summit, which is covered by sculptures of small children.

I walked among these nearly two hundred sculptures as if through a forest of human bodies, overwhelmed and awed. Vigeland’s artistic achievement is on the scale and magnitude of Michelangelo’s Sistine Chapel, Gaudi’s La Sagrada Familia, and Monet’s Water Lilies series. While his sculptures have not received the recognition of those famous works, they are nothing less than an artistic giant’s monument to humanity—to life, love, health, and human relations in all their multiple forms. The Vigeland sculptures are unmistakably ideological in that they represent a celebration of our bodies, female and male, and a celebration of the cult of life as opposed to the cult of death which ravages so much of our oversexed, overly violent media and world. Something about the Vigeland Sculpture Park struck me as distinctly Scandinavian, and European as well, in the sense that it was about health and vitality, a particular idiom of la dolce vita, infused with the mentality of slow food, organic agriculture, urban gardens, and bike paths, but in this case manifesting as these magnificent concrete expressions in granite and bronze. And it was about not only bodies but bodies that are au naturel, lacking embarrassment or modesty, yet not salacious, their nakedness just a normal part of life.

The Vigeland sculptures are a source of great pride for Norwegians. This was apparent when I mentioned the subject to one stoic taxi driver, a typical older Norwegian who had white-streaked hair and a chiseled chin, wore square aviator eyeglasses, and gave one-word or one-line responses and an occasional smile. But his face lit up when I praised the Vigeland sculptures. “Thank you,” he smiled more widely, bowing slightly but in a prideful way that meant he thanked me on behalf of his country.

These were just a few of the many manifestations of the attitudes and policies toward health that I found in Europe. Sometimes the Europeans remind me of hobbits, with a love of leisure, nature, relaxation, good food, a stimulating glass of wine or dark, earthy beer, and steeped in the values of health, family, and quality of life. It is these values and this outlook that they bring to their workfare system and their social capitalism, instilled into them in both intent and design. It’s also the values they inject into their formal health care system, which mostly is based on a principle of "people instead of profits," unlike the U.S. healthcare system which is run as a for-profit commercial enterprise and dominated by corporations and CEOs making hundreds of millions of dollars in annual salary and bonuses. The various European health care systems put people and their health before profits -- la sante d'abord, “health comes first,” as the French are fond of saying.

So if you ever are in Oslo, make sure to check out the Vigeland sculptures in Frogner Park, you will be in for an amazing experience.

Steven Hill 3:13 AM Permalink | Trackbacks | Comments (1)
November 1, 2010
 by Steven Hill

BOMBS, BOMBS EVERYWHERE; EUROPE PONDERS AMERICA’S RETURN TO BUSH-LITE…Yesterday when I was in Istanbul, a bomb went off in Taksim Square, not far from where I was staying. As Taksim is one of the one of the main thoroughfares of this energetic city of 13 million people, chaos ensued and suddenly police were everywhere. My taxi driver, speaking only a few words of English, was able to communicate that he was in Taksim when the bomb went off. “Grand BOOM!” he says, shaking his head, looking grave. He indicates that it was a Kurdish suicide bomber who attacked a police stand, killing 10 cops, but news reports are not so certain. There is much speculation that it could also be an Islamic radical, and the initial news reports say either two, or possibly zero people are dead, but quite a few are injured. Yet within an hour or so, people seem to be back to “shopping normal” in the trendy areas around Taksim Square, though Taksim itself remains shut down.

Later in the day I arrived in Frankfurt airport to the headlines that the German police had found a bomb on a cargo plane (it was later determined that the flight passed through Germany on its way to the UK, where the bomb actually was found). In both the Frankfurt and Istanbul airports the security seems to be about the same, no extraordinary efforts visible to the passing eye, which is surprising but also a relief. Airports already are such a hassle to get through, a constant reminder of the advantage of taking trains in Europe whenever practical distance-wise, since the security is less draconian and you don’t have to arrive an hour or more in advance.

Any Americans who think that Europe’s efforts in the war on terror (perceived as inadequate by many Americans) results from them not understanding or appreciating the impact of the September 11 attacks in New York City aren’t appreciating the fact that Europeans have lived with this kind of low intensity conflict for years. Indeed, blowback from unwise American foreign policy decisions in the Middle East during both the Obama and Bush administrations washes up on Europe’s shores first, since it is in much greater proximity to the zone of conflict. Europeans have learned to live with this kind of insecurity in a way that Americans are still getting used to.

Europe contemplates America’s return to Bush-lite.For the past couple of weeks there has been much speculation in the European media about the U.S. election on November 2. I also have received a lot of questions about it during my speaking tour, both from audiences and journalists. Europeans are perplexed, to say the least: how could Americans have turned away so dramatically, with the election of Barack Obama, from the policies of the Bush-Cheney administration, only now to contemplate a return to them? They also are puzzled by the Tea Party movement, which seemingly wants to roll back the last two years and return to how things were at the end of the Bush-Cheney years, which Europeans pretty uniformly regard as a disastrous time, both economically and foreign policy wise. Even conservatives in Europe are scratching their heads over their transatlantic allies (“What, Americans don’t want health care?”). Asked one Swede, “How can these Tea Party people say ‘Get government out of my Medicare -- don’t they know Medicare IS a government program?” If Europeans could vote in America’s November 2 election, there is no doubt how they would vote.

This in some ways is the greatest measure of the divide in the transatlantic alliance. Even the so-called “far right” in Europe is nowhere near as conservative as the Tea Partiers or GOP Congress members; indeed, in most ways the far right is to the left of the Democratic Party, which is fairly startling to contemplate.

So it has been one of my tasks to have to explain to puzzled Europeans what is happening to American politics. My view is that it mostly boils down to the overuse and abuse of the filibuster in the Senate, which has fostered a toxic obstructionist politics. The filibuster has been used by Republican Senators on average twice a week to stall everything, but it used to be deployed only a few times a year. Obama hasn't even appointed numerous positions a president typically appoints because the Republicans would have filibustered those nominations, thereby clogging the Senate's calendar and leaving less time for his legislative agenda. Paralysis has become the norm. In my view the obstructionist filibuster is the single greatest reason for the gridlock that is frustrating so many Americans. As proof, I would offer this thought experiment: imagine how different things would have been if Obama only needed 51 out of 100 Senators’ votes instead of 60. The health care bill wouldn't have been so weak, AND wouldn't have taken so long to pass, leaving more time for the rest of his legislative agenda. The same with financial re-regulation; the climate change bill would have passed; as well as possibly a second (smaller) stimulus more precisely targeted at infrastructure, shovel ready jobs, etc.

I don’t believe that many Americans agree strongly with the hard core Tea Partiers who grouse about a “government takeover of health care, return of big government,” etc. What most Americans are upset about is the sense that not much has been done for them personally or for people they know (at this point just about every American, or someone they know, has lost their job or their house or both). There’s a feeling that the noose is tightening , even as banks and auto companies got bailed out. The banks and CEOs have returned to raking in handsome profits, but virtually none of it is trickling down. And that has led to a great sense of frustration, anger, even betrayal that Fox News/Tea Party types have exploited effectively (a type of populism that is not all that surprising -- recall the early 1990s recession, which gave a boost to populists like Ross Perot, Pat Buchanan and his "peasants with pitchforks" speeches, etc, -- we should EXPECT to see an increase in populism at this point in an economic downturn, whether in the U.S. or Europe. Their influence will last no more than one or two election cycles unless this downturn proves to be particularly long lasting). For example two of my GOP family members voted for Obama, even though they didn’t necessarily agree with him on everything; but because generally speaking they saw him as the best candidate for moving the country past the Bush years, i.e. in a new direction. Now they are upset at Obama, not necessarily because they disagree with what he has done but they view him as INEFFECTIVE. To people like them, the Tea Party is a thumb in the eye to the system, a pox upon both the Dem and Rep houses. They are not very tolerant of excuses e.g. "blame the filibuster," and the fact that throwing out Dems brings back the same crowd they voted out last time requires a depth of thinking that they aren't willing to engage in. That's the problem with populism/"thumb in the eye" politics -- it's a gut level response that lacks any memory or historical insight.

Like a coyote chewing off its own leg. But the Tea Partiers have little in the way of solutions to offer toward the challenges that America faces. It’s mostly a nostalgic movement, looking backward toward some golden age that never existed. And so the American electorate is going to careen from one side of the aisle to the other, not finding satisfaction, and will only get more frustrated and angry. The best metaphor for understanding the American electorate right now is that of a coyote with its leg caught in a trap, suffering in pain, so now it is chewing off its own leg to get out of the trap. Grisly, I know, but that's about as accurate a description as I can think of.

And just think, much of this situation could have been avoided if only 51 votes were needed in the Senate. I am not generally so reductionist in my thinking, but in this case I really do think the filibuster is the elephant in the living room, in terms of understanding what has dragged down American politics into the current cesspool. That’s what I have conveyed to my European audiences.

Steven Hill 11:40 PM Permalink | Trackbacks | Comments (1)

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