Smart Links 15 September 2011
Articles on right sizing the state and related thoughts, France’s banks, the five stages of grief as it applies to global markets, the real economy at street level, Marx is back, European shell games, can China save us, and how to preserve French in Quebec.
The first step to an excellent future is to quantify the size of the state as a percentage of GDP. Thanks to Richard of Victoria.
The Globe and Mail -- Canada’s enviable shrinking of the power of the state
[In his book, The Government versus the Market] economist Vito Tanzi predicts the shrinking of the modern state, asserts that it has already begun and regards Canada as an early leader in the process.
Quote worth quoting.
“He simply tracks the trajectory of a central conundrum of the 21st century. The state can’t survive without the market economy – but the market economy cannot survive the excesses of the state.”
centralbanking.com -- Review of Government versus Markets: The Changing Economic Role of the State, by Vito Tanzi
As the full economic impact of the global financial crisis became apparent in early 2009, a chorus of commentators began to predict the resurgence of the state.
Pdf below – Victor Tanzi, The Role of the State in the 21st Century
Quote worth quoting.
“Tanzi’s main thesis is that the modern state has three main functions: resource allocation (broadly the provision of public goods including defence, internal order and a legal system); the redistribution of income; and macroeconomic stabilisation.”
Whatever people think about the power of the market, in the end, the state has the monopoly on legal violence, and forced borrowing.
Financial Times -- Forced borrowing: the WMD of fiscal policy
A spectre is haunting Europe – the spectre of sovereign default.
What ails the French banks.
Wall Street Journal -- What's the Matter With the French Banks?
Whether the market's worst fears are realized or not, the financial system maintains too close a relationship to the state.
Getting to acceptance.
Financial Times –Five stages of grief for global markets
The well-known Kübler-Ross model of grief has five stages: denial, anger, bargaining, depression, and acceptance.
In the guts of the real economy.
Financial Times -- America’s economy: An uncertain outlook for Main Street, USA
Putting struggling small businesses back to work has been placed at the heart of the quest for growth – and for a president under pressure, the political stakes are as high as the economic ones.
What Marx got right, and wrong.
Business Week -- Marx to Market
The economic crisis has made the philosopher’s ideas relevant again, but the world shouldn’t forget what Marx got wrong.
No hiding the truth of Europe’s looming financial disaster.
Bloomberg – European Bank Blowups Hidden With Shell Games
The last time the world had a major banking crisis, fair-value accounting rules were near the top of the list of scapegoats most likely to be denounced by government and industry leaders. Not so this go-around.
China steps forward.
Washington Post -- How China can help Europe get out of debt
The European crisis is no longer a European crisis.
Want to preserve French in Quebec, get the economy growing.
Toronto Sun – Economy at the Root of Saving the French Language
Quebecers are very sensitive when it comes time to talk about language issues.
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Twin Virtues: Inequality of Outcomes & Equality of Opportunity©
Ultimately, the most successful societies find the balance between the twin virtues of inequality of outcomes and equality of opportunity.
The new politics must marry the twin virtues of unequal outcomes and equality of opportunity.
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