Rhetoric: Living in the Age of Bluff?

Even on this lucky continent, resourceful politicians must learn how to survive periods of constrained resources. There are many tested ways to perform on the cheap: For instance, amend commercial, consumer, and environmental regulations; update the criminal code; make a solid impression at international conferences; and assign blame to others, those who aren't liked by most of their voters.

This new century’s signature ploy may be the bluff, hints of heroic intention that fall well short of heroic action.

Here are a few familiar subjects worthy of heroic treatment: climate change, Russian military aggression, the middle class’s disappearing American Dream, nuclear proliferation, Iran, and North Korea. And here is an eclectic, short list of active practitioners: Barack Obama, Stephen Harper, William Hague, Hillary Clinton, Chrystia Freeland, and all Western neocons and recent premiers of Ontario.

Here are a few illustrations (If you laugh spontaneously, they’re flops. If they remind you of Sir Winston Churchill — out of power — they work):

William Hague, foreign secretary of the most literate and shrinking English-speaking power, declares that the crisis in the Crimea represented the “gravest security threat of the 21st century.”  

Chrystia Freeland, Member of Parliament for Rosedale, calls for sanctions against Russia that “bite.”

Stephen Harper suggests that Russia be kicked out of the G-8.

Barack Obama’s applies the cold war Domino Theory to Crimea.

Hillary Clinton calls for a “mass movement” to stop global warming.

At first glance, I was most impressed by Hague’s alarming historical framework. He implied that brave action by everyone must be taken, that failure to act will haunt us in the history books. But the record of this busy century quickly gets in the way. Is today’s Crimea crisis actually more dangerous than 9/11 and global terrorism, the Iraq War, the Great Recession and the sovereign debt crisis in the Eurozone, and all that’s looming in Iran, China, and North Korea?   

Only Hillary Clinton’s radical sounding exhortation has staying power. Her heroic challenge won’t be taken off the public agenda merely by behind-the-scenes diplomacy. It has awful staying power. More importantly, her statement in no way leaves her accountable. She can make a fortune giving speeches about a terrible problem or, conceivably, become America’s third president waiting for "mass" encouragement to exercise responsible leadership.

Is bluff always dangerous or bad for us? Not necessarily.

In the '80s — when his declaration was meant have effect — Ronald Reagan’s belligerent declaration that the Soviet Union was an “evil empire” struck many as irresponsible, a charge best made by a bishop, not a president in a nuclear cold war.

Even-tempered Barack Obama is not good at bluffing — fortunately.

His “red line” assertion about Syria was taken seriously by the Economist, Senator John McCain, and, allegedly, by factions in Syria’s civil war — but not across America. Consequently, when his line was crossed, America didn’t have to get into another war to preserve its honor and another president’s credibility.

Defiant American and Canadian rhetoric about effective sanctions on Putin’s Russia, however, are probably doing more harm than good. The more we "own the podium," the less that affluent Europe has to sacrifice for its own security.

Finally, should we be embarrassed about our tolerance for and today’s promiscuous use of the bluff? Not this year, for sure.

The year 2014 is the hundredth anniversary of a slaughter that was caused and sustained not by bad intelligence and the stresses of rapid change, but by leaders and peoples seduced by hateful myths about their neighbors and ridiculously extravagant rhetoric about honor.

Better to be alive now — in an age of comics and cynics. Our political leaders can still be persuasive, but we’re not as easily taken in or enslaved by their bluffs.

Nourishment for currency unionists

If North Americans can think constructively about Europe’s problems, maybe they can start thinking a little more creatively about their own. 

In a fascinating interview with Terence Corcoran of the Financial Post, Robert Mundell, American Nobel prize–winning economist and widely identified as the “author of the euro,” challenges the most popular theoretical argument used to attack the logic of Europe’s currency union, as well as the logic of our own.

“[Mundell] dismisses the claims of critics who say that the euro was a mistake because Europe is not a fiscal union. ‘Very few countries in the world have a fiscal union. It would be almost impossible for a large country to have a complete fiscal union. Canada and the United States do not.’

“‘It is curious how American and sometimes North American economists have tried to nail the deficit problem as a 'euro' problem. If the Government of Canada or Newfoundland or Ontario ran up their public debts, and had big current deficits to boot, would that be a debt-deficit problem or a loonie problem? If California is on the verge of insolvency would that be a U.S. dollar problem or a debt-default problem for California?’”

Click on: http://opinion.financialpost.com/2012/06/08/robert-mundell-euro-is-here-to-stay/

Estonia, Germany, France, Italy, and 13 other states; Newfoundland, Ontario, Quebec, Alberta, and 6 other provinces; California, Texas, Michigan, South Carolina, and 46 other states—all using the same medium of exchange and responsible for own budgets. 

For 15 years, for 145 years, for 236 years, three democratic currency unions with multiple fiscal regimes, with uneven business cycles and hot and cool labor markets, have allowed for long-term economic growth and peaceful political change. 

Each currency union, furthermore, includes sub-jurisdictions with significantly different political cultures—some enjoying great power and many carrying on with relatively little.

Europe’s central institutions and federal budget (less than 2% of Europe’s GNP) are, today, relatively small compared to the public sectors of its 17 members. Consequently, political coordination is required to mobilize the credit and power of the whole of Europe to fight a crisis in its member states. This problem hasn’t existed in North America for over a century.

North American federalists don’t face Europe’s currency management crisis. Instead, we imagine ways to stay apart as readily as we bother to act together.

With severe global pressure to be even more innovative, productive, and flexible, tell me again: What’s the conversation-killing argument against a currency union of the two oldest federations—Canada and the United States?

Leadership: please, leave the spin for later

Thanks to popular theories of participatory management, our bloated communications bureaucracies, and film footage of FDR and Churchill’s best performances, it’s now accepted that great leadership and great communication roll-outs go together.

“Grand bargain(s)” on the euro zone and the US federal deficit, actions to reduce escalating health care costs and adapt to the aging Baby Boom long ago stopped being technical or even ethical mysteries.

At a moment less dangerous for Europe than today, Prime Minister Jean-Claude Juncker of Luxembourg, the chairman of euro zone finance ministers, explained: “We all know what needs to be done, but we do not know how to get re-elected after that.”

Click on: www.theglobeandmail.com/report-on-business/international-business/european-business/latvia-shows-how-europe-can-save-itself/article4240590/

Inaction and endless in-camera meetings, in large part, can be blamed on a fair-weather illusion: Leaders can always have a persuasive explanation—a winning communications plan—when they make big decisions.

Responsible leaders—at least in our representative democracies—needn’t feel so fettered. They are assigned the responsibility of making hard decisions—on time—and answering later to the people. That’s the sequence of events that allows democracies to keep up, and often surpass, the pace of decision-making in dictatorships.

Good politicians ultimately need to be good in debate. Canada’s Stephen Harper, for instance, will eventually have to defend his reforms on pensions, unemployment assistance, and environmental regulation. Next year, Obama and Congress will have to explain why they finally had to mess with George Bush’s temporary tax regime.

However, sensitive, democratic, humble, or arrogant leaders needn’t know exactly how to win all the arguments before taking action. Furthermore, often the facts speak for themselves or are so complicated and so susceptible to interpretation that only results will settle the matter.

All the issues raised above can be settled to the ultimate satisfaction of the public at large. Yet, leaders can’t simplify and broker their responses enough that they can be sure that reasonable people will understand and like what’s being done, right off the bat.

Left and right should back the Euro

Escapists chase very different utopias and still end up in hell.

Extreme left and extreme right voices in Europe imagine relief by imagining that the European market—and its cornerstone, the Euro—was misconceived. It’s seen as a straight jacket by the so-called Keynesian left and as a helicopter parent by neo-conservatives.

Nationalist contempt for big federations is logical. Chauvinists exist in provinces, states, and national capitals on both sides of the Atlantic. What they want and what they’ve championed over the last century, fortunately, are understood as well.

In the clutch, the left can be counted on to oppose what the nationalists want. The left believes in the welfare state and activist government but is not naïve about borders or trade barriers per se. Nationalism, they know, invariably rewards privilege and is paid for by the less powerful.  

The muffled amusement of neo-conservatives toward the perilous state of the Euro-zone, however, is logically indefensible. Their renewal of the case for market liberalism has been vital in breaking down economic barriers globally and has supplied much of the policy agenda of the European Union and its moderate left and conservative member states.

All too readily, however, they fall back on a uniquely Anglo skepticism toward federations. They too readily see federal systems as incompetent rather than irreplaceable guardians of open markets. Andrew Coyne of the National Post is uncompromising about the flawed Euro-zone:

“There is little doubt that, as currently constituted, it has proved a disaster, making half of Europe uncompetitive and forcing the other half to bail it out. It was an attempt, as we can now see, to stretch a single currency over countries with very different economies and, more important, very different political cultures. That would have been a problem even if the common monetary authority had been backed by a common fiscal authority, as elementary theory would suggest it should have been. But with every country off borrowing as much as it liked, in defiance of their obligations under the Maastricht treaty, the project was ripe for catastrophe long before the crisis exposed its weakness.

Click on: http://fullcomment.nationalpost.com/2012/05/07/andrew-coyne-frances-vote-against-austerity-is-like-a-vote-to-outlaw-bad-weather/

Setting aside nearly 240 years in the US and 142 years in Canada of regularly falling short of “elementary theory,” our North American federations have operated rather well with two rather over-reaching currencies and often reckless state and national governments.

Texans haven’t asked specifically to bail out Californians or vice a versa. Rednecks in Alberta haven’t been asked to subsidize French Canadians or Tory snobs in Halifax. However, all of them have been electing national governments that cushion hardship in other communities, and ameliorate economic shocks and foolish mistakes half a continent away.

The proposition that the Europe Union is just too divided economically and culturally isn’t reasonable, either. Americans are at least as divided as Europeans on hot button issues. Until this week, in fact, polarization and gridlock were seen as unique and fascinating American vices.

Furthermore, as a basic measure of economic disparity—income inequality—these two great federations are almost the same. After reviewing personal income and national data, Jim Manzi points out in the National Review:

“It turns out that America and Europe as a whole have extremely similar levels of economic inequality—Europe’s is just chunked by country.”

Click on: www.nationalreview.com/corner/290260/america-really-more-unequal-europe-jim-manzi#

Europe should ultimately be able to make its common currency work. If it needs more time to regain its confidence, however, its neo-cons should at least make the case that the alternatives—the economic nationalisms of the past—were truly disastrous.

Angela Merkel and those glorious technocrats

Time magazine’s choice of the Protestor as the person of the year captures the temper and the potentiality of the moment. Also, it honors personal courage. However, as with Barack Obama’s Nobel Peace prize in 2009, its logic seems rather premature.

Protestors in Tunisia, Libya, and Egypt demonstrated that no political order is permanent. However, they didn’t rediscover the idea that the world is changeable. Outside the Middle East, it was already widely asserted that the status quo—the global order of interdependent market economies that the designed and the whole world now operates—would soon break up.  

The biggest story of this year is not what the protestors have changed, but how well the world's young imperfect order has held.

This was to be the year for the center to lose its grip: Washington was to be irredeemably radicalized by the Tea Party, debt-default, and a double-dip recession, and the “fundamental flaws” of the Euro zone were literally going to reverse European integration.

Next year may be different. For this year, however, the so-called technocrats—the central bankers, the economists, and the elected politicians who respect and can comprehend their advise—made the real news, and saved the status quo.

Their prominence shouldn’t be dispiriting. Their accomplishments don’t represent a surrender of democratic politics to robotic bureaucrats.  

It is noteworthy that the two Western leaders holding more political power in December than they held last January—Angela Merkel and Stephen Harper—are both called technocrats. And those whose authority has weakened—Barack Obama, David Cameron, and Nicolas Zarkozy, for instance—are called consummate politicians and great communicators.

Slate magazine noted the technocrat’s impact but misrepresented their vocation.

“An expert, not a politician. Technocrats make decisions based on specialized information rather than public opinion. For this reason, they are sometimes called upon when there’s no popular or easy solution to a problem (like, for example, the European debt crisis). The word technocrat derives from the Greek tekhne, meaning skill or craft, and an expert in a field like economics can be as much a technocrat as one in a field more commonly thought to be technological (like robotics). Both Papademos and Monti hold advanced degrees in economics, and have each held appointments at government institutions

Click on: www.slate.com/articles/news_and_politics/explainer/2011/11/technocrats_and_the_european_debt_crisis_what_s_a_technocrat_.html

Angela Merkel has proven to be a master of details but, also, an architect of political change and a shaper of public opinion.

Addressing the “fundamental flaws” of the Euro-zone, rather than surrendering to them, requires confidence as a politician as well as technical credibility.

Great public projects demand both sets of skills—occasionally in one person, usually in seamless teams. In the spirit of this season of generalities and Time magazine, here are a few propositions about these two sets of political actors:

The technocrats prefer to huddle; the campaigners look for the podium.

The technocrats are called incrementalists and miss deadlines because they like to test ideas.

The campaigners like to force the issues and compromise later.

Euro skeptics: reactionaries without memories?

Politicians on the sidelines of the Euro crisis have been relatively free to think out loud. British Tories are having the most fun, getting fresh attention for diehard positions.

They’re didn’t like the century-long decentralization of their amazing empire and never accepted that political federations in North America, Europe, or elsewhere could ever govern as well as unitary states. The success of the European Union and its Euro-zone has been their longest frustration—since the American union climbed out of a civil war and saved their democracy in two world wars. 

Old ideas can look fresh when first brought in from the cold. Prejudice can sound like dogged principle.

The European Union, under the cover of a multilingual bureaucracy in Brussels, is a mongrel federation of tax and work-loving northerners and hedonist thieves along the Mediterranean. The Euro-zone, they exclaim, is “fatally flawed” because it’s incomplete. And, if its flaws are seriously addressed with greater fiscal integration, it will be run by the Germans!

Every whim of the whimsical bond market buoys their contempt.

British Conservative Prime Minister David Cameron has been cowed into vacuity.  He is now concerned that Germany’s Angela Merkel—who must raise additional hundreds of billions of Euros in Germany to calm the markets and save Europe’s commercial banks—may actually want a more accountable and more coherent EU in return.

Here’s Timothy Garton Ash’s summary of Cameron’s concerns:

Speaking at the Lord Mayor’s Banquet in London, Prime Minister David Cameron evoked a Europe “with the flexibility of a network, not the rigidity of a bloc.” “We skeptics,” he averred, “have a vital point. We should look sceptically at grand plans and utopian visions.” This crisis offers an opportunity “in Britain’s case, for powers to ebb back instead of flow away … and for the European Union to focus on what really matters.” In short: less Europe.

Click on: www.theglobeandmail.com/news/opinions/opinion/clarifying-europes-choices/article2238496/

This is the same wordsmith who claims as Prime Minister that he can close the gap between severe austerity and compassionate conservatism by bringing to life a “Big Society” of community activists.

Former British Labour Minister for European Affairs Denis MacShane provides the rebuttal.

“Euro speculators want to claim victory by seeing Greece forced out of the euro zone – followed by Portugal, Spain and Italy. A return to drachmas, escudos, pesetas and lire will be good for millionaire Brits and Germans with villas in southern Europe, where life was so much more agreeable when their neighbours were poor and used “Mickey-Mouse money”, as one British eurosceptic Conservative described the drachma.

“Only one force can stop the speculators from winning. That is the power of the democratic state organized in an unbreakable alliance with other democracies. More Europe is the answer to the disintegrating Europe we now confront.”

Click on: www.ft.com/intl/cms/s/0/86788aea-1048-11e1-8211-00144feabdc0.html#axzz1dy9XhTJY

The pursuit of a European federation is, first and foremost, a political idea. It is not the surest way to make money or the best stage for a Britain or a German politician to play politics like a true Britain or a true German. It is certainly not a utopian idea.

It is amongst the skeptics you are most likely to find rosy memories and little Utopian visions.

The European Union was created to make it less easy and less profitable for nationalists to divide Europeans as they have so often done in the past. That prudential vision obviously still disciplines Europe’s decision-makers. It fends off so-called “skeptics” who would play dice with Europe’s future.

Brain Candy from Toronto

“In a democracy, fear often does the work of reason.”

—Larry Summers, Toronto, Canada, November 14, 2011, at the Munk Debate on the North American Economy. 

Obama’s Director of the National Economic Council and bad cop intellectual was arguing that gridlock in Congress will not permanently paralyze Washington or limit America’s capacity to restore itself.

As yields on the 10-year bonds soured in Greece and Italy, fun-loving Greek and Italian politicians just crossed party lines and formed national unity governments to implement harsh economic reforms.