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Wednesday Night 1503
Written by Diana Thebaud Nicholson // December 22, 2010 // Emerging markets/economies, Government & Governance, Herb Bercovitz, India, Kimon Valskakis, Microcredit, Reports, Ron Meisels, Wednesday Night Authors, Wednesday Nights // Comments Off on Wednesday Night 1503
We Earthlings witnessed a complete lunar eclipse on December 21, Winter solstice, an event that last occurred in 1638. The more spiritual (read less technical) Wednesday Nighters may possibly have been influenced by the miracle of this happening in our lifetime or perhaps more likely, by the recent rapid changes in the pecking order of the nations of the world. This might possibly explain the differences in predictions by Wednesday Nighters concerning the social and economic order of importance of nations or, perhaps not. It would appear that although crystal ball technology may be considered reliable, it is at times, subject to misinterpretation.
In the investment world, the predicted end of year recess has thus far failed to materialize, but the signs are clear for a lot of selling of securities after December 28 -29, to be followed by a January, 2011, recovery.
One Wednesday Night guru sees the world as being in a precarious situation, not doing well at all. He sees the economy fraught with the fallout of social unrest, the United States in a precarious position, perhaps foreshadowing another crash.
On the other hand, the Technical guru sees the stock market as a leading indicator, the bellwether rather than the victim of the economy. He explains that all shocks and favourable events have been factored in. There has been a bad jolt to the system in both the economy and the stock market. Following the crash, the stock market became very oversold, foreshadowing the slower, as yet completely unrealized economic recovery.
There remains a lot of cash looking for a home, patiently waiting out the post-crash economic and social realignment of the pecking order of nations. Europe is in distress but unable or unwilling to face the reality of having to tighten its belt. This economic view favoured the conservation of cash over investment.
In contrast, the emerging markets have cash, are not concerned with human rights, are investing heavily in infrastructure, creating employment and enhancing prosperity. Those Wednesday Nighters sharing this view, predict that the emerging markets, as well as Canada, Australia, Asia and Latin America will do well. Canada, fortunately, does not share the U.S. burden of heavy debt and balance-of-payment problems.
Age, Wisdom and Leadership
1939 marked the beginning of World War II. The Maginot Line, the continuous concrete defence line on the French-German border that had been predicted to deter any attempt at invasion, proved absolutely useless as the Wehrmacht rapidly crushed the French resistance and overran the country. It is believed by some that the major factor in this humiliating loss was the age of the defending French General. The influence of youth on society has increased over the years for numerous reasons, perhaps most significantly the rapid changes in the nature and complexity of technology and increasing human longevity significantly increasing the age gap between the young and the old. The rapid rise in computer technology has provided universal access to information, further favouring youth over the older sector of the population. Traditionally, the craft of the father was passed on to the son. In the twenty-first century, with increasing longevity and rapidly developing technology, there has been a shift in leadership qualities in many fields to the younger generation. Wikipedia does not necessarily bestow maturity but at the other end of the scale, old age does not always bestow wisdom. The concepts of wisdom and leadership have become less fixed, with a focus both on leadership qualities and expertise. An unfortunate truism is that leadership and wisdom do not necessarily travel together.
Immigration, Multiculturalism and Accommodation
The laudable objectives of the French Revolution of liberty, fraternity and equality appear to conflict with France’s obligatory acceptance and integration of immigrants from that country’s former African colonies. Integration appears to be proving difficult at this time.
Asia’s current financial success does not necessarily translate into quality of life.
The Canadian approach to multiculturalism is said to have been a disaster when an attempt was made to apply it in Germany although it has been successfully applied here, albeit provincially rather than nationally.
The story of microcredit empowering women and reducing poverty has, over the past few years, been one of success. Recent reports of a number of suicides in India by women following their inability to repay their debt, clash with previous reports of an extremely high percentage of debt repayment. It would appear that although initially, the purpose of microcredit was to empower women, it became victim of its own success, with some banks charging interest rates so high that that repayment becomes virtually impossible. Thus, in a number of cases, what began as a social mission has become an opportunity for banks; business having overtaken altruism. It is to be hoped that regulation and greater charitable involvement will renew the original goals of microcredit.
The struggle in Haiti for continuing existence and emergence from poverty appears to be ongoing without letup. As Pierre Arbour details in his fascinating monograph on Napoléon, much of the problem originates with the intransigence of successive French governments in the face of Haiti’s struggle for independence, and the 1825 demand for an indemnity equivalent to some $12.7 billion (finally paid off in 1947). Debt payments to France for the independence of Haiti contributed to the underlying dire situation (see The fault line in Haiti runs straight to France), but the issue is not that simple. Corruption, the devastation of the earthquake, and the onslaught of cholera are all contributing factors to the ever-worsening conditions. There are multiple non-governmental organizations present, but little or no coordination between them. Food is being delivered but there appears to be little effort to deliver Haitians from poverty; a cloudy future is foreseen. One aspect of the problem is the number lack of coordination between NGOs; the provision of immediate aid, but the absence of a common plan for the future emergence of a self-sufficient independent nation. All ten thousand NGOs are said to be centered in Port au Prince and uncoordinated. KANPE is a Haitian organization dedicated to coordinating the aid and rebuilding villages, one at a time, addressing not only hunger but all factors contributing to poverty. If it is as successful as hoped, the entire country may be expected to slowly emerge from what has been to date, a study in intractable poverty and suffering.
The New School of Athens
The first of a series of conferences organized and hosted by the New School of Athens was recently held in Bordeaux under the patronage of former French Premier Alain Juppé. The series, titled Governing Globalisation: Lessons from the Past, Strategies for the Future, examines different models of governance (projets de société) from the perspectives of the public sector, civil society and academia. The second, chaired by Kimon Valakakis and Angéline Fournier, and which will look at what is to be learned from the Canadian model, is to be held in Montreal April 13-15, 2011. The honorary co-chairs are Monique Jérome Forget and Thomas d’Aquino .
Everyone is so busy in this period doing commercial and social things that there is little time for exercising that most important part – the intellect. We are happy to offer the solution – in the company of our Global Governance Guru, Kimon Valaskakis; Wednesday Night’s expert on emerging markets, Germain Bourgeois; and the vibrant Madeleine Féquière – come exercise your brain in pleasant, intelligent company. We promise not to play The Little Drummer Boy, or any other Christmas elevator music.
In the fine tradition of potluck, we offer only a few dishes and encourage guests to bring their own contributions to the table.
Thus, our first item is microcredit/finance, a topic Madeleine knows well and whose application in Haiti we have been following avidly, partly because of our friend Katleen Felix ’s involvement.
Marie Cormier writes of her concerns as follows:
Salué comme une initiative de solidarité sociale et économique permettant à des gens démunis d’avoir accès à du capital afin de partir de petites entreprises pour sortir de leur pauvreté, le micro-crédit connaît certains dérapages. En raison d’une utilisation du micro-crédit à des fins de consommation et non de production et d’abus des collecteurs de prêts, on en réclame maintenant la réglementation. Lire à ce sujet, l’article Le micro crédit en crise dans l’Andhra Pradesh dans le Newsletter Aujourd’hui l’Inde
La problématique semble de trouver un juste équilibre entre la protection des personnes vulnérables économiquement et socialement et le développement des FMI qui ont atteint un stade de développement plus avancé.
Meanwhile, Sheila Arnopoulos writes: “There has been a lot of trouble around microcredit in India in Andhra Pradesh where I did a lot of my research due to the lack of balance between social mission and the push for profits by the Microfinance Institutions. 56 women that had been taking loans committed suicide. The story was covered in the Globe and Mail and the New York Times as well as The Economist.
I have written an article on my website that discusses the best way to protect the women. It is based on interviews with both Ela Bhatt, head of the Self-Employed Women’s Association (six chapters in my book) and Vithal Rajan who has done an article on it for a major economic and politics journal in India.
On another topic, Kimon calls our attention to Gail Collins’ recent commentary : “Mitt Romney is pushing No Apology: The Case for American Greatness, which is doing well in sales despite the fact that Romney’s central concern is whether America will become ‘the France of the 21st century.’ Given all our problems, does that sound so bad to you, people? Your medical care would improve, your life expectancy lengthen and dinners would be much tastier.”
[Note: the rest of this column is a highly entertaining review of Republican candidates’ literary offerings]
Kimon, recently returned from an examination of the French model by the Dialogues de Bordeaux – and busily preparing the April 2011 conference on the Canadian model –undoubtedly agrees with Ms Collins.
We might also look at governance in the context of how, when pressed to do some serious work over the run-up to Christmas, the U.S. Congress is suddenly doing things it should have done months ago – repealing Don’t ask, don’t tell, ratifying the START treaty, etc.
No table d’hôte would be complete without reference to WikiLeaks and all of the fascinating views on this topic. What’s really wrong with WikiLeaks is one you may have missed … worth considering in relation to governance issues.
Finally, do join us in commiserating with our friends who are attempting to fly to Europe, or in fact anywhere through the backed-up international airports. There are certainly some advantages to staying home at this time of year.