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Poisonous politics lurk behind the EU recovery fund – Financial Times



The writer is director of the centre for economic policy at Esade business school in Madrid and former economics spokesperson for Ciudadanos

A friend working at a city council on the coast of southern Spain wrote to me the other day. “The whole management of the European funds is going to be a nightmare . . . we have too much money!” she said. “I have been told to spend €10m on the installation of photovoltaic plaques in 100 public buildings. But I don’t think we have 100 public buildings! This is a small city!”

This example is a microcosm of the problems surrounding the €750bn in spending to be unleashed under the Next Generation EU (NGEU) fund to aid economic recovery after the pandemic.

The initiative is a unique chance to transform Europe’s southern economies. But there is a risk that the money will be wasted in boondoggle projects. Given the poisoned politics across the continent, this poses dangers for the EU. Europe’s currency union was conceived as a way to reduce competitiveness gaps among countries. But progress on structural reforms has been slow. In terms of productivity, the gap between the core and the south is widening. The Covid-19 crisis will just accentuate these diverging trends.

Reforms in the south have failed in the past because too little attention has been paid to how to make them actually happen. Without a better understanding of this problem, NGEU is likely to repeat previous failures.

At present, the incentives for reform could hardly be worse in the south. Governments are fragmented and weak. More political parties have a veto power over reforms. Populist forces on the extremes will reduce the ability to reach agreements through the centre.

Moreover, thanks to the European Central Bank’s actions, market pressure on governments has disappeared. Low borrowing costs will make it easier for them to postpone reforms. The Recovery and Resilience Facility, through which 90 per cent of NGEU funds will be channelled, lacks teeth on economic conditionality. 

The debate on conditionality has been misleading. Nobody argues that, having been hit by a pandemic, populations in southern Europe should be exposed to fiscal austerity or more social suffering. But that does not mean we should forget about reforms.

Column chart of Minimum number of parliamentary groups needed to produce an absolute majority (including the PM's party) showing Governments in the southern countries are fragmented

Money alone will not solve structural problems. Think of Spain’s active labour market policies. Spain has the EU’s highest school dropout, youth jobless and temporary employment rates. It already spends more than €6bn a year on ALMPs.

However, according to Spain’s independent fiscal authority, there is no evidence that this money is improving employment opportunities for workers. Throwing more money into the system without reforms will simply reinforce the system’s flaws.

In the coming months, it will not be hard for the European Commission and national capitals to agree on a 50-point reform plan. The problems will start after agreeing to that plan.

Without a governance framework for NGEU that makes reforms actually happen, governments will spend the money satisfying their short-term electoral needs rather than implementing politically costly reforms. Why would they behave differently this time?

Bar chart of Forecast change in GDP in 2020 (%) showing Southern EU economies are likely to have been hit hardest by  Covid-19

To ensure good governance, consider a proposal made 15 years ago by Harvard economists Ricardo Hausmann, Dani Rodrik and Andrés Velasco. They called for a strategy that would set policy priorities for governments “in a way that uses efficiently the scarce political capital of reformers”. Rather than trying to implement long laundry lists of reforms, which are “seldom helpful”, they proposed a framework for identifying the most binding constraints for economic growth in a given country.

EU governments and the commission should follow this framework, engaging in an honest conversation that results in a smaller set of structural reform goals. These should focus on two or three truly binding constraints for growth in areas such as human capital or institutional modernisation, where reform is necessary and politically achievable.

If nothing changes, it is not unrealistic to imagine that five years from now Dutch retirees, for instance, will be asked to take pensions cuts, while their newspapers are full of stories of EU money wasted on useless projects in southern Europe. Such an outcome could prove fatal for the EU. 

In 2020, the EU has done the hardest part, putting together an extraordinarily generous package as a response to the crisis. In 2021, Europe’s priority should be to make it work.

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COVID, Politics Make Dry January Harder Than Ever – WebMD



Sarah Moran, Chicago.

Denise Hien, PhD,  director, Center of Alcohol and Substance Use Studies, Rutgers University, Piscataway, NJ.

Carl Hart, PhD, Ziff professor of psychology, Columbia University, New York City.

Angela Voulangas, Brooklyn, NY.

Aaron Ahearn, Southern California.

Twitter: @RepBrendanBoyle, Jan. 8, 2021; @zachbraff, Jan. 12, 2021; @007, Jan. 8, 2021.

Instagram: #dryjanuaryfail.

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Politics Briefing: Trudeau says appointment of Payette was 'rigorous' – The Globe and Mail




Prime Minister Justin Trudeau says the federal government will take another look at its process for nominating governors-general, in the wake of Julie Payette’s resignation last night.

Ms. Payette, an accomplished pilot and astronaut who took office in 2017, has had a rocky tenure and appeared to have struggled with the public demands of the office. An independent investigation of her office, which the government ordered last year and received this week, appeared to validate concerns of harassment in the workplace.

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Mr. Trudeau was asked at his midday news conference whether Ms. Payette should have been vetted more carefully for the job, given she had earlier left a position at the Montreal Science Centre in a similar cloud.

“For all high-level appointments, there is a rigorous vetting process that was followed in this case,” Mr. Trudeau told reporters. “Obviously we will continue to look at that vetting process to ensure that it is the best possible process as we move forward.”

This is the daily Politics Briefing newsletter, written by Chris Hannay. It is available exclusively to our digital subscribers. If you’re reading this on the web, subscribers can sign up for the Politics newsletter and more than 20 others on our newsletter signup page. Have any feedback? Let us know what you think.


The drop in Pfizer-made COVID-19 vaccine doses coming to Canada is set to worsen, but the pharmaceutical company insists it can still catch up by the end of this quarter.

Newly released documents show that a Montreal manufacturer that won a $282.5-million contract to make ventilators last year produced machines that initially had serious problems that caused delays to delivering on time. The case illustrates the challenges associated with companies that pivoted in the early months of the pandemic to make medical technology that they had not previously made.

The U.S. Senate will receive the articles of impeachment against Donald Trump on Monday.

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And here is your weekend reading: Power Gap, a new Globe and Mail series by investigative journalists Robyn Doolittle and Chen Wang that gives a data-driven examination of how and why so many women are held back from positions of power and prestige in the workplace. While so much attention is paid to women in the top-most positions, the series explains how the real issues are at all levels – particularly middle management.

Campbell Clark (The Globe and Mail) on the original appointment of Julie Payette as governor-general: “Less than four years ago, she was Mr. Trudeau’s celebrity pick. A former astronaut, an accomplished woman, bilingual, someone who already had schools named after her. On the surface, she was the very image of the modern governor-general the still-newish Trudeau Liberals wanted. But we now know that proper vetting might have shown her temperament was ill suited for the job.”

John Fraser (The Globe and Mail) on changing the appointment process: “Whatever anyone thinks of Stephen Harper and his Conservative administration, it had developed a good system for searching out and vetting possible candidates for all the vice regal positions in Canada – the lieutenants-governor of the provinces, as well as the governor-general. It was rejected by the Trudeau PMO, although officials there liked the system well enough to adopt it for appointments they made to the new-style Senate.”

Shachi Kurl (Ottawa Citizen) on repairing the office’s public image: “In 2021, at a time when worries about being seen as too elitist have the Prime Minister himself too scared to fix the house in which he’s supposed to be living, and given that Payette herself refused to even reside at Rideau Hall, should a home and all its associated domestic trappings still come with the job? Would Canadians be better served if the whole building were opened up to them, as a gallery, or museum, or place of learning?”

Andrew Coyne (The Globe and Mail) on Canada’s slow pace of vaccinations: ” Vaccinating as many people as we can isn’t just a matter of saving lives – although the faster we do it, the more lives we will save. It’s also a matter of some economic urgency. The country that emerges quickest from the pandemic, and from the curbs on activity most countries have adopted in response, will not only save that much more in lost GDP.”

Robyn Urback (The Globe and Mail) on making lockdowns more targeted: “At this point in the pandemic, we should know better than to extend curfews to homeless people, close down skating rinks and issue fines to mothers in pursuit of childcare.”

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Bria Hamilton (The Globe and Mail) on why the healthcare system needs to build more trust with Black Canadians: “My grandmother, my mother and I have all had extremely negative experiences with Canadian medical care. The most atrocious story was the removal of my grandmother’s uterus without her permission during unrelated surgery.”

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A pick between dark politics or collective resistance – The Hindu



The democratic world has a choice — either accept the politics of violence or kindle the urge to resist the status quo

All politics is a struggle for power; the ultimate kind of power is violence.” — C. Wright Mills

Donald Trump’s drive to upend a legitimate election has shaken faith in the functioning of democracy worldwide. When a president of a country himself condones the rioters or calls them “patriots”, a grim reality awaits democracy in the face of the pervasive political polarisation ripping apart the very political fabric of a nation. Politicians across the globe sink to new levels of unwarranted incitement of a malleable public, a disastrous and politically debasing tendency of constitutional democracy.

U.S. Capitol | The siege of a historical power centre

History as a pointer

The loss of faith in the ruling elite points towards a disturbing future. The long and cyclic dark history of civilisation, of wars and violence, of religious fanaticism and irrationality is a loud indication of the failure to model society on rational principles. Our inherently dialectical history confirms the simultaneous birth of opposing forces at the very moment of assertion of any “truth”. For example, the trajectory of liberal democracy evolving into totalitarianism is evidently present in the brute forces of Italian fascism or German Nazism, two striking examples of the birth of vulgar nationalist fervour and racial superiority.

The shock of Capitol Hill

In the wake of the debacle on Capitol Hill, the world awakes to the reality of the scourge of violence within democracy, rousing a serious national debate on what comprises aggression, who perpetuates it, and why. It is imperative to halt the runaway course of democracy towards an environment increasingly subsumed in the violence of fear and hatred, an overwhelming plague in any civil society. Breaking, therefore, through the intellectual vacuity of the official discourse and coming to grips with the history of electoral violence we see that what happened on the Potomac is nothing new in the long history of racist and electoral violence.

But it is not Mr. Trump who is solely responsible. The people are as much to be blamed. Jason Brennan, in his valuable and bracing book, Against Democracy, makes the contrarian conclusion that democratic participation promotes human beings to forget common sense and common politesse. Voters, as he puts it rather uncharitably, are “biased, ill-informed football hooligans” who “can present arguments for their beliefs, but cannot explain alternative points of view”. Along with them are the “hobbits”, a section that lacks fixed strong views on political matters. These two categories have their antithesis in the “Vulcans” who, Brennan argues, “think scientifically and rationally about politics”. Nazism, Trumpism or Hindutva are outstanding examples of this syndrome and the analogy fits in aptly with the credentials of the demonstrators in Washington DC, the “superbiased” who mindlessly fall in line with the manifesto of the ruling dispensation.

Editorial | Fruits of incitement: On the mob attack on U.S. Capitol

Evasive promise

Philosophical democratic theory is, therefore, rather perplexing. One aspect is the idolised view of democracy as an inimitably just form of government where people have the right to equal share of political power that empowers the people. However, judging by the history of violence, this could be an absolutely off the mark argument within real-world politics. It only shows that political participation has the potential of making people more irrational, prejudiced and mean. It pulls apart, impedes the social order and creates antagonists of civic order. A higher form of life that democracy promises seems to evade the public.

The debatable questions, therefore, would be: Does democracy leave you smart and active, or dumb and uncivilised? Does it give us a broad outlook or is it selfishly limiting to one’s immediate needs? Does it not make people live in a world of delusion and deceit expediently passing the blame on to the Left or the “professional anarchists” responsible for violent acts of arson and loot, while thousands of protesters sustaining the powerful state apparatus are labelled as “peaceful” or as “patriots”. Death, pain and physical injury of people fighting back for civil liberties and human rights are of no consequence.

Also read | Arnold Schwarzenegger compares U.S. Capitol mob to Nazis

The power and brutality of state violence therefore stands legitimised while justifiable or innocent violence accompanying demonstrations against racism or police ferocity result in ruthless consequences. The nightmare of history indeed, brings us face to face with sinister times that impel the need to oppose the offensive right-wing narrative that discourages dialogue, economic welfare and freedom of expression. The erosion of egalitarianism and freedom through unprecedented challenges from anti-humanist forces pushing democratic institutions to the brink of failure is effectively in operation globally.

At the irreducible moment of confronting the nightmare of history, we have a choice before us. Either we accept the politics of ethnic intolerance, inequality and violence or arouse within us the unfaltering urge to resist the status quo. In the absence of activism, people are bound to fall prey to irrationality, resentment, xenophobia and the inexorable yearning for fear-inducing power. Shockingly, the right-wing fringe element anywhere in the world, America or India, seem untouched by the state brutality on the innocent and the marginalised.

In pictures | Chaos, violence, mockery as pro-Trump mob occupies U.S. Capitol

Political beginnings

Recognising the failures of the past while retaining hope for the future, we need to develop a critique of violence within democracies that is adequate to the times. Understandably, there is always a political struggle basic to the recognition of evident and hidden forms of injustice and violence that make people mindful of it, deliberate on it, and act. These are the “political beginnings” that Hannah Arendt optimistically spoke of in her perennially relevant book, Men in Dark Times. To her, the collective power of the people mattered more than the power of the state, but only when the struggle is against authoritarianism and bigotry, not when the masses begin to prop a fascist disposition.

Shelley Walia, a professor, has taught Cultural Theory at the Department of English, Panjab University, Chandigarh

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