Archive for ‘governance’ Category

Playing us for suckers.

datePosted on 14:39, December 7th, 2010 by Pablo

John Key has announced that changes to the SIS enabling laws that will expand its powers of surveillance of cell phones and computers as well as its use of electronic tracking devices will be pushed through parliament before the Rugby World Cup. He claims it is necessary to do so because “many world leaders” will be visiting during the RWC and appropriate security measures must be in place that require changes to the 41 year old SIS charter. The Privacy Commission advised for a three year review of the pertinent laws but was ignored.

This is the second time that Mr. Key has used the RWC to justify a modification of a security measure, the first being the withdrawal of the NZSAS from Afghanistan in 2011 because they are needed for duty at the RWC. Just as it is ludicrous to believe that NZ’s most elite troops would be used as guards or stand-bys for a sporting event held in Aotearoa, it is also an insult to the NZ public intelligence to claim that the RWC is the reason for the law changes that expand the SIS powers of search and surveillance.

The changes are actually just another continuation of the steady expansion of the NZ security apparatus over the last ten years. It runs in parallel with the proposed Search and Surveillance Bill, which gives wiretapping and eavesdropping authority to a range of local and national agencies that have nothing to do with security. Each year the SIS budget increases, as does its personnel. Police intelligence has also increased in numbers and seen its role expanded. The question is, first, what threats exist now that require such an expansion of the coercive powers of the State?  Are these threats of such a magnitude that basic civil liberties must be curtailed in the purported interest of national security? If so, why are they not publicly identified and enumerated so as to raise public awareness of them? If not, why, in an age of public bureaucracy down-sizing and privatisation, is the repressive apparatus growing, especially in its internal dimension?

Truth be told, all claims about terrorists notwithstanding, from where I sit there appears to be very little in the way of new, imminent and developed threats that constitute a clear and present danger to NZ national security so as to justify the continued expansion of the repressive apparatus at the expense of civil liberties.

We will never hear an answer to the questions I have just posed because John Key says that “it is not in the public interest” for hearings on the proposed changes be open to scrutiny. Instead, submissions on the proposed changes will be open to the public but the hearings on them held in private because–you guessed it–it was “not in the interests of national security” for the hearings to be heard openly. In sum: for John Key, the public logic is that for the sake of a one-off athletic event that is limited to a handful of former rugby-playing Commonwealth countries and some joiners (unlike more universal competitions like the World Cup, the Olympics or Commonwealth Games), the entire fabric of (mostly domestic) intelligence-gathering must be expanded and domestic liberties further curtailed.

One wonders what National’s  private logic is.

What are Mr. Key and his pipe dream team smoking that he can bald-faced say such utter nonsense and expect the NZ to be so gullible as to believe him? Or is the NZ public that stupid that it will believe that these proposed law changes are needed to protect visiting world leaders at the RWC and are so sensitive that their merits cannot be debated openly? Does he think that Kiwis do not care about legislation that curtails their basic rights, or that they believe that it is best to allow the government to just push through tougher ‘anti-crime” laws without public debate?

It could well be the case that the proposed changes are due to the fact that advances in telecommunications have allowed criminal and extremist groups to transfer funds and send instructions more easily and securely in and out of NZ. It could well be that criminal and extremists groups are scheming and plotting in NZ, and the proposed law changes will allow the SIS to better counter them. But that should be publicly explained and justified, not considered privately within the confines of the Parliamentary Security and Intelligence Committee, which is comprised of a grand total of 5 people and in which the government has the majority.

The bottom line is that the proposed legislation has nothing to do with the RWC and all to do with an ongoing expansion of the State’s powers of coercion at a time when its ideological apparatuses are increasingly failing to reproduce mass consent to the elite’s preferred ideological project. Having supported the equation of dissent with terrorism while in Opposition during the 5th Labour government, National is keen to ramrod more encroachments on basic rights in pursuit of the challenged elite project. Having eroded the right to organise and collectively defend worker’s interests while opening up the country to a variety of investors, yet having its hopes for asset sales to foreigners  and de-regulated mining on public lands thwarted by public resistance, National has turned to the old canard of “security” to dupe the public into giving up more rights to the State.

Raising the spectre of security threats provides a convenient cloak for the assertion of State powers of control and punishment on all those who challenge it, criminal or benign. That is why Mr. Key wants hearings on the proposed changes to be held behind closed doors, because if they were made public then open challenges can be made to the justifications for an expansion of SIS powers as well as the underlying reasons for them.

Mr. Key and his minions must be resisted as the closet authoritarians that they are.  In democracy. law changes need to receive a full and open airing, it is changes to security and intelligence laws that threaten the fundamental rights that lie at the heart of democratic society. The proposed changes are one such instance, which makes it too important a matter to be left to the privacy of the Parliamentary Security and Intelligence Committee in the run-up to the RWC. Mr Key cannot have it both ways: either he believes in democratic accountability when it it comes to national security matters and its impact on fundamental rights and restrictions on them, or he believes in elite perogative, to include the issue of balancing of security and rights.

The only way to find out is to force him to choose, and for that to happen requires an Opposition that understands–surprise, surprise– that political advantage can often be gained by standing on principle. One can only hope that is now is such a moment of realisation for Labour, even if it means turning on the monster that it created nearly ten years ago.

Squandering Political Opportunity.

datePosted on 12:51, October 31st, 2010 by Pablo

The dramatic reversal in the Democrat’s fortunes since November 2008 and their impending defeat in Tuesday’s mid-term elections raises the question of how things went so wrong for them in such as short time. Needless to say, the situation they inherited did not help: a major recession with near record unemployment, bankruptcies and home foreclosures, two wars of occupation, immigration concerns and a deeply polarised electorate. Even so, President Obama had a wave of popular support, the Democrats gained control of Congress, there was a mood for change in the country and the world was sympathetic to the incoming administration. Inherited obstacles notwithstanding, the scene was set for a major shift in direction under consolidated Democratic leadership for years to come.

Instead,  the Democrats have foundered while the GOP-Conservative opposition has rebounded and mounted a formidable challenge that threatens to undermine any hope for significant alterations in US policy direction. The immediate reasons for this Republican resurgence and the pallorous state of the Democratic Party (and the President) in the run-up to the midterms has more to do with the latter’s strategic and tactical errors rather than the former’s platform for governance. The Democrat errors can be enumerated, and will be summarised here.

The first strategic error was to believe that playing a centrist game was going to work. That may have succeeded in years gone by, but with an Republican opposition operating off a script of obstructionism, fear-mongering, personal denigration, xenophobia and cultivation of populist ignorance, it was never going to prosper in today’s political climate. Appeasing a disloyal opposition simply encourages it to become more vicious in its attacks, particularly when it has a partisan media working on its side. Thus the “Kenyan-Muslim-Socialist” and “Pelosi-Reid deficit spender” memes that have reverberated from the moment the Obama administration took office and the Democrats gained control of Congress.

What the President and his party should have done is staked out an explicitly Liberal-Left policy agenda that starkly differentiated their (relatively, given that it is in the US) progressive and pro-active  approaches to the nation’s woes. They were going to be vilified anyway, so the stark differentiation of their platform from the reactionary and failed GOP approach would have clarified the lines of debate in ways that the public could clearly understand, both in terms of where the fault lay with regards to the economic woes of the country as well as in the solution set being offered as an alternative. After all, the US has not had anything remotely close to a “progressive ” policy agenda (and I say this phrase advisedly simply because what passes for progressive in the US is centrist is most other liberal democracies) since the early days of Jimmy Carter’s presidency, and the inherited economic and political conditions were ripe for a bold move away from the failed policies of the Bush 43 administration. That would have been a real agenda for change.

Since the Democrats did not do so, they failed on a second strategic level: they failed to impose the terms of the policy debate and ceded that space to the Fox and talkback-led conservative opposition. Since the latter had little to offer other than invective, this allowed them to turn to the usual diversionary wedge issues in order to gain political traction: ethnic conflict, cultural mores, “socialism,” and taxation. Whatever the administration’s accomplishments (and there have been a number, including nuclear arms reductions with the Russians and the gradual military exit from Iraq), these have been lost amid the din of conservative outrage about sins more imaginary than real.

Thus the Democrats found themselves on the defensive even as they tabled their policy agenda. Since those who dictate the terms of debate are those who win the debate, that meant that they were fighting a losing battle from the get-go.

They compounded these strategic errors at a tactical level. President Obama granted leadership of the legislative agenda to his Congressional counterparts. That was a mistake. The November 2008 elections were about him, not the Congressional leadership. The Democratic take-over of both Congressional majorities was more a result of coat-tailing on the President’s popularity than on the intrinsic merits of Democratic candidates themselves. Obama had a mandate, and he had the political capital surplus to spend; Congress did not, and in fact remained one of the country’s most detested institutions even after his election. Thus, by delegating leadership on the legislative agenda to the likes of Pelosi and Reid (which he likely did in deference to his former senior colleagues), President Obama ceded his bully pulpit to the circus on the Hill. That gave the impression that he was weak and insecure, which in turn gave the Republicans space to go on the attack against “entrenched interests” and all the other failures of the DC-based “liberal elite.”

The tactical error was compounded by the choice of battles to commence with. Instead of focusing on mortgage relief and rescue for desperate homeowners, serious financial market reform, education opportunity enhancement, immigration policy adjustment and re-orientation of US military commitments abroad (among any number of policy areas), the President and Congress chose to address health care first. Although it is obviously needed given the deficiencies of the US private health care system, it was simply too contentious and big a problem to tackle at the onset given the image of Presidential lack of experience and his conciliatory nature. Democratic strategists may have believed that they had to spend the President’s political capital early so as to ensure its passage, but in fact taking that policy issue as the first order of business under Congressional leadership direction hamstrung the Democrats even if they succeeded in passing a watered-down version of health care reform that provides some level of universal benefit to all citizens.

Put another way: the last thing the American public wanted to hear at a time of deep recession and after the financial bail-outs of the banking and automobile industries was that more public money would be spent of health care and that future taxes would reflect that increased level of deficit spending. Compared to the billion dollar figures being bandied about with regard to health care reform, Obama’s “middle class tax cut” (for those earning US$250,000 or less) and tax rebate (amounting to $500 per household) were seen as negligible drops in the bucket and meaningless political sop thrown for opportunistic purposes. For those who had spent a lifetime of paying for private insurance, it also seemed be a case of the indolent, irresponsible and unmotivated being gifted, at taxpayer expense, benefits that they did not deserve. Once the Republican-conservative spin machine got a hold of the issue, the spectre of “socialised” medicine replete with “death panels,” lack of individual choice, limits on care, endless delays and assorted other deficiencies soon dominated public discourse regardless of Democrat attempts to clarify the issue.

The combination of these four factors–failure to head to the Left and carve out a distinct position, ceding the terms of political debate to the opposition, allowing Congress to set the legislative agenda and choosing to reform health care as the first priority–set the stage for the political train wreck that is the Democrat’s midterm election campaign. To that can be added a failure to realise early that Republican operatives are using the Tea Party movement as a Trojan Horse with which to re-gain political momentum and a return to power. Similarly, the White House chose to ignore rather than frontally confront the “Kenyan-Muslim-Socialist”  allegations until they were well entrenched in the public consciousness–a full twenty percent of the US electorate now believe that the President is one, the other, or all three. It is too late to bolt the door against such attacks.

Some argue that the Democrats are playing to lose because the inevitable gridlock that will follow from Tuesday’s vote will allow the President to paint the Republicans as do-nothing obstructionists without a real agenda for solving national problems. That could be true if the Republicans do not win the Senate as well as the House, but if they win both branches then they will have the ability to impose a legislative agenda that among other things will repeal the health care reforms and other aspects of the Democrat’s agenda that have been accomplished so far. That puts the ball in the President’s court because it forces him to exercise his veto in order to salvage his original program, which in turn casts him as the obstructionist during the two years leading into the 2012 presidential election.

The bottom line is that although the Republican-conservative opposition play extremely dirty, the Democrats have no one but themselves to blame for this impending election fiasco. If Clausewitz is correct in his assertion that war is politics by other means, than the reverse is equally true: politics is war by other means. The goal is to win, pure and simple, and that means that if the opponent is going to play dirty then the governing party must understand what it is up against and counter it decisively without equivocating about the niceties involved. Rather than understand this very simple logic, the Democrats returned to form, tried to play nicely to the center, tried to respect the separation of powers mythos that is ingrained in US political folklore, tried to be civil in the face of a disloyal opposition and tried to embark on big policy reforms before the the President and his new Congressional counterparts had fully moved into their offices. For their efforts they are going to get hammered on Tuesday.

Drawing Blood from a Stone.

datePosted on 19:59, October 8th, 2010 by Pablo

The government’s decision to file a civil suit against the “Waihopai 3” is vindictive and a gross waste of taxpayer dollars. Much like the Zaoui case, which could have been concluded years before it actually did at far less cost than the amount on the final bill, this is a classic example of a vexatious state litigation. Vexatious state litigation, to coin a phrase, is an instance when the state (exemplified here by the Crown) continues prosecutions, appeals or defenses long after legal defeat is obvious and, as in the case here, judicially administered. Even so, there are a few aspects of the case worth reviewing.

As I mentioned in an earlier post titled “Political Idealism Trumps the Law,” the Waihopai 3 expertly exploited the claim of right defense to defend their direct action against the eavesdropping station. Contrary to most direct action proponents, they did not admit their crimes and accept their due punishment, but instead used the claim of right defense to argue their innocence based on moral grounds. Among other things that defense states that even if mistaken in their motives, people who honestly believe that their acts will prevent a greater harm are exonerated of responsibility for the consequences of those acts. Thus, although I (and presumably the government) believe that they are mistaken in claiming that the Echelon station at Waihopai facilitates torture, war crimes, crimes against humanity and human rights violations, the important point is that Peter Murnane, Adrian Leason and Sam Land were found by a jury of their peers to be innocent because they sincerely believed that their actions were helping to prevent a greater harm. So long as the claim of right defense exists in the law and juries are willing to accept that defense as legitimate, then the verdict should stand and, in the absence of irregularities in the administration of the case, no appeals or civil lawsuits filed. In other words, that should be the end of the story.

If the government does not like the claim of right clause in the law, it can work to change it. But suing for civil damages to the tune of 1.2 million dollars, including the cost of pies, beer and savories for repair workers, smacks of imperial hubris. Moreover, the claim is unrecoverable even if the Crown were to win the lawsuit. Father Peter has no tangible assets, and since neither the Dominican Order or the Catholic Church were party to his actions, they cannot be made parties to the suit. As for Land and Leason, what is the Crown going to do–confiscate Land’s organic farm and repossess Leason’s house while garnishing his salary, thereby throwing their families onto the street (and dole)? Even if it did so, the amount recovered from the sale of the assets of all three men would not come close to paying the full bill. So what is the point if the full costs are not anywhere close to recoverable?

The Crown also has not thought through the consequences of its lawsuit. The GCSB refused to front up at the original trial in order to refute the defendant’s allegations. That pretty much left their claims uncontested, which was instrumental in the jury’s verdict. Is the GCSB now going to show up at a civil trial and be prepared to re-litigate the original claims under the claim of right defense? If not, then there is no case for damages because a verdict of innocence under the right of defense absolves defendants of financial liability stemming from their acts. To put it bluntly: a verdict of innocence under the claim of right defense means full absolution from liability. That is why the right of defense is such a dramatic line to take and so difficult to argue successfully, which is why most direct action militants do not even bother with it and opt to plead guilty and ask for judicial mercy citing mitigating factors. But in this case the right of defense was made and it prevailed. Unless the GCSB wants to testify as to the merits of the claim of right defense as well as to the extent of the damages incurred (which I believe have been exaggerated) then there is no case to be made. If there is no case to be made, the pursuing the lawsuit is a waste of time and public money.

If the government allows this civil suit to continue it will be another example of politicians and state bureaucrats playing loose with taxpayer money in order to prove a vengeful point regardless of the merits of the case. The suit is clearly designed to be a warning to others who would dare to use the claim of right defense for direct actions, and therefore not only a form of vexatious state litigation but also an act of official intimidation against those who would dare speak (their) truth to power. For a supposed liberal democracy, that is a bad look.

In the debates about the proposed labour law reforms there appears to be fundamental misunderstanding or ignorance by National and ACT of the purpose of unions in capitalism. The latter are seen by NACT as at best a source of inefficiency and profit loss; at worst parasitic wealth destroyers. They appear to misunderstand that capitalism left to its own devices, with no collective counter-weight provided to workers, is akin to a political regime without opposition parties. That is, it is inherently an authoritarian status quo in which owners rule and workers obey. Thus, if we hold it self-evident that democracy is a better form of regime than dictatorship precisely because it allows for the existence of a freely organised competitive political opposition that can contest power and times compete for it, then we must also recognise that capitalism needs unions in order to be representative and fair to the society at large. The trade off between democracy and capitalism is exactly that: a diminished rate of exploitation in direct proportion to the measure of voice exercised by workers in pursuit of a fair share for all.

That is why unions were organised in the first place: to bring a subordinate group vehicle of voice and redress to the economic system. Whatever their very evident flaws (Leninist organisation, iron law of oligarchy bureaucratic rationales), unions provide a democratic counter-weight to unfettered capitalist exploitation. Just as it is preferable not to have a closed, unaccountable (or at least vertically unaccountable) oligarchical elite run the affairs of state, so too is it undesirable, from a democratic perspective, to have a closed, vertically unaccountable economic elite determine the social relations of production. If one believes in democratic capitalism, one must believe in a central partnership role for unions within it.

This is true whether labour-based or capitalist-oriented parties are in power, since in capitalist societies the material welfare of all is dependent on the investment decisions of capitalists. But capitalists need workers to realise their investment, and workers need to be productive for profits to occur. There is consequently a structural bias in favour of providing the working conditions and larger social context in which profitable production can occur over the long term. For that to happen workers need to accept the system as given, which is a function of them perceiving a partnership stake in it. That means a modicum of voice and representation. Democratic capitalists consequently understand the need to exchange super-exploitation and authoritarian control of the workplace for increased working class representation in both politics and production. In turn workers (and their political representatives) accept the capitalist foundations of society and the dominant role of capitalists within it (in other words, they forego a move towards socialism). This exchange is at the heart of democratic capitalism. Although negotiating the margins of the democratic capitalist social contract can occur depending on the nature of the government in power, “touching the essential” aspects of it is not.

Authoritarian capitalism offers many short term advantages to business, but it does not guarantee long term gains. Unmitigated authoritarian exploitation, be it in the workplace, politics or both, breeds resentment. Born of a lack of consent to the dominant system, resentment can be manifest in everything from petty acts of social defiance to industrial sabotage to revolution. Short term acquiescence may be bought with material rewards, but the long-term picture remains clouded so long as workers do not buy in to the system as given and instead resent their subordinate status in it. Absent mass consent and given the inevitability of working class resentment, the resort to the “weapons of the weak” negatively impinges on profit, if for no other reason then that the costs of repression grow larger the longer authoritarian control is maintained. After all, you cannot repress the same amount of people in the same measure over time.  Since capitalists abhor uncertainty and seek stable rates of secure return, a peaceful, consent based socio-economic and political order is preferable to an imposed one. That gives economic utility to democratic capitalism.

In fact, where democratic capitalist systems work best (hegemonically, as it were), many if not most workers strive to become capitalists themselves (small businesspersons, at a minimum). They see themselves on a continuum of upward mobility based on workplace fair play and merit. Socialism is not their preferred option. The proof is in the mythos: is this not the Kiwi, Ozzie and American dream?

Here is where NACTs reforms and the demands of the employer class says much about their true orientation. They claim belief in freedom of choice and the benefits of market competition as the great levelers of social ambition. If that were true, then they would welcome workers to freely organise without legal constraint or negative repercussion because true market competition and workers freedom of choice would improve overall economic (labour) market efficiency. After all, according to their own logic, the market works best when all have equality of opportunity, and it clears best when all actors enter into the market exchange exercising their full potential as free agents involved in the mutual supply and demand of goods and services. So if workers exercising their free choice want unions, then more the better from a market perspective. Why put constraints on that freedom?

Yet in practice NACT seeks to place constraints on working class collective choice and voice so as to better exercise owner/manager prerogatives in the workplace. They are, in other words, hypocrites who do not really believe in the power of the free market or closet authoritarians out of ignorance (unlikely) or by design. Or both. No amount of political spinning can disguise that fact.

What is more, NACT does not appear to comprehend, from a cynical perspective, that allowing for unionisation, including union workplace access, while reducing limitations on the right to strike and collectively bargain across economic sectors can actually serve very usefully as an alienation device in which workers are led to believe that they are real partners in production in a system in which the fruits (surplus value) of their labour are appropriated by others (in a variant of Lenin’s “democracy as capitalism’s best possible political shell” argument). Although unfettered collective action has the potential to open the door to worker challenges to control of production, the reality is that in democratic capitalism private ownership is reified from birth to grave and most workers live with the dream of being bourgeois in culture and consumption if not employment. So whether cynically or sincerely committed to workplace democracy, enlightened capitalists understand the long-term political utility of union representation in democratic society. NACT and its business supporters appear to be anything but enlightened.

As I mentioned in my previous post on the matter (“The Blues Go Black”), the proposed reforms owe their inspiration to the Pinochet Labour Code. The question is whether NACT have the same view of unions as Pinochet and “Pepe” Pinera did, and if so, why do they make any pretense as to being democratic? Could it be that what we are seeing in NZ is the first attempts to turn the economic bases of the democratic social contract into something akin to unchecked elite imposition under manipulated electoral conditions?

Countering threats as a growth industry.

datePosted on 18:15, July 23rd, 2010 by Pablo

News that the US has a network of over one thousand agencies employing more than 800,000 people involved in counter-terrorism efforts comes as no surprise. The post 9/11 reaction to the threat of armed Islamicist extremism by the US government was as visceral as it was knee-jerk, with a blanket call put out to increase every aspect of the country’s counter-terrorism capability. From intelligence gathering to emergency response and everything in between, counter-terrorism agencies proliferated from the local to the state to the federal level, as did the number of private firms engaged in direct counter-terrorism efforts as well as support roles.

But there are problems with this expansion, and it is not just the waste of resources associated with the duplication of functions and overlapping of roles that comes with it. Nor are the problems confined to the US. Let me list a few.

Around the world concerns about terrorism has seen the expansion of government security apparatuses dedicated to fighting it. Intelligence agencies, police forces and the military of virtually all Western states, to say nothing of those in the Sunni Arab world, Africa, Asia and the Antipodes, have increased the amount of resources directed towards countering potential terrorist threats (South America is the exception to the rule because traditional inter-state rivalries and the lack of Islamicist grievances in the region have led authorities to focus attention elsewhere). In New Zealand, for example, both the Combined Threat Assessment Group (an inter-agency combine that analyses intelligence flows and threat assessments from such as the SIS, Police, NZDF, MoD, Immigration, Customs and Foreign Affairs) and the Counter Terrorism Tactical Assault Group (CTTAG, a combined military and police specialist unit trained to respond to terrorist incidents) were created after 9/11. Similar agencies now litter the state security landscape throughout the world.

Along with the proliferation of agencies comes increases in their funding and personnel, and more perniciously, the scope of their responsibilities. Again, in New Zealand this is evident in the Terrorism Suppression Act (TSA), which is modeled on similar legislation in the UK and US and which gives broad powers to the government to infringe on basic civil liberties in its efforts to detect and stop suspected terrorism-related activities on NZ soil. The same goes for the Search and Surveillance bill now before parliament. In the US the so-called Patriot Act, which is still in force, grants US security agencies broad powers of arrest and detention on the mere suspicion of terrorism-linked behaviour. The expansion in both the number and legal authority of counter-terrorism agencies has been facilitated by politicians who, in an effort to not look weak on the issue of terrorism, approve budgetary increases and laws that fuel the growth of the counter-terrorism industry. In the post 9/11 rush to promote security, only a few brave politicians have attempted to resist the trampling of civil rights that the expansion of the security apparatus inevitably entails.

Besides the obvious problems that come with the “squeezing” of civil society by the security state (since the expansion of the state’s counter-terrorism powers come at the direct expense of the right to privacy and presumption of innocence), there is another downside that needs to be considered: the construction of threats in order to justify the existence of counter-terrorism networks. What is more, this phenomena extends beyond government security agencies and into private enterprise and academia.

In order to justify their existence, security agencies have to be able to identify and counter threats. In some countries the threats are real, as is the need to thwart them. But in much of the world the threat of terrorism is no more than it was in the 1990s, 1980s or 1970s. One such place is NZ. In these countries security agencies have a bureaucratic self-interest in identifying “threats,” because if there are no new threats then the rationale for their role and resource expansion goes out the window. Thus in 2005 the NZSIS identified “home grown jihadis” as the gravest security threat to NZ. A year later it dropped all reference to local Islamic extremists and highlighted foreign espionage networks operating on NZ soil. The following years have seen it highlight foreign-based computer hacking and industrial espionage as sources of concern. Each year appears to bring with it a new threat, even as the others are quietly dropped from annual reports.

Along with state security agencies conjuring up or exaggerating threats, so has an army of private security firms, including open source intelligence providers, security guard outfits and private military corporations sprung up to take advantage of the post 9/11 climate of fear. They bandwagon with state security agencies to emphasize the dangers of terrorism and other threats so as to nurture a client base for their services. The infamous Blackwater (now known as XE) private military corporation is an example of a “one-stop” private contractor that has its own intelligence, airborne, naval and ground units ready to serve both public and private clients for handsome fees (one of their latest ventures is in anti-piracy operations).  Thousands of other such firms now dot the global security landscape, all emphasizing the dangers of  the threat environment in the pursuit of profit. Not only does this industry work neatly with state security agencies’ agendas, but it further squeezes civil society in the measure that its surveillance capabilities and quasi-police powers increase as well.

Even academia is not immune from this trend. Over the last decade “counter-terrorism” centres have sprung up in dozens of universities world-wide. They receive their funding from governments, hold conferences, and churn out reports, books, even specialised journals that are dedicated to the subject (including “Perspectives on Terrorism” and “Terrorism and Political Violence,” although my favorite journal along these lines is “Small Wars and Insurgencies”). Here too the push is on to identify threats so as to justify continued funding. Places like Nanyang Technological University in Singapore, home of the S. Rajaratnam School of International Studies, have dozens of highly paid researchers working on counter-terrorism and threat analysis projects (including one analyst at RSIS who declared that NZ faced a domestic Islamicist threat without ever having been to the country). Since funding for its facilities and personnel is directly related to its threat analyses, NTU has a vested interest in helping ensure that the perception of the global and regional threat environments is that they are variegated and “dense.” NTU is certainly not alone in pursuing the counter-terrorism dollar–this is a world-wide trend.

And of course, there are the countless terrorism “experts” that have sprung up as analysts and talking heads in the corporate media. No matter how tenuous their qualifications for discussing issues of threat posed by terrorism and irregular warfare groups, these pundits materially benefit from the exposure afforded to them by the sound-bite crowd.

Which brings up the thought for the day. Threats to international and national security do exist and terrorism is real. But pragmatic threat assessment and better use of extant security agencies and criminal law to counter terrorism have been overwhelmed by the urge to manipulate the impression of threats for individual, corporate, bureaucratic or political gain. That in turn has seen a shrinking of the civic space and private sphere in inverse proportion to the expansion of integrated (private-public) national security networks.

When money combines with a climate of fear, impressions of threat can be manipulated (if  not invented) in order to pursue profit or bureaucratic power. Threat manipulation in pursuit of corporate self-interest and the expansion of state security apparatuses poses a serious risk to democratic society. In another life long before 9/11 I participated in actual threat assessment exercises for the US government. The ethos then was to call things as they were, objectively, so as to not allow political agendas or ideological bias to divert resources away from real dangers. Now that logic has been reversed: threat mitigation is seen as a potential source of income and power, with the more threats identified the more resources will be directed towards them by political elites and a fearful public. By that logic, counter-terrorism is the mother of all cash cows, and as NZ prepares to host the Rugby World Cup, we can assume that there will be plenty of interested parties working hard to milk it regardless of the real threat environment in which the tournament is held.

It must be my week for thinking about small states in personal terms. I only took an interest in the specific dynamics of small states when I moved to NZ, having previously written mostly about larger states (although I did write a bit on Cuba and Uruguay before moving to NZ). Living in NZ exposed me not only to the political dynamics of a small democracy, but the social dynamics as well. Things like the 2 degrees of separation that make putting distance on ex-partners very difficult. Things like the rapidity with which one’s personal life becomes the object of professional speculation, and how quickly rumors in one dimension transfer to the other. Things like blacklisting, sinecures and shoulder-tapping.

I write this more as an open question to readers. My question rests against the backdrop of NZ being proclaimed as the least corrupt country on earth by one polling outfit, and the general consensus that it is one of the more successful liberal democracies in existence. But if liberal democratic success is defined as the absence of corruption in and ascriptive rationales for social advancement, plus the universal presence of merit, equality and transparency in public and private upward mobility, can we really claim that NZ is a “success” on those terms?

I may stand corrected on this, but it strikes me that for a democracy NZ has an unusually high incidence of shoulder-tapping and sinecure-mongering. Shoulder-tapping is the practice of rigging a competition by pre-selecting the favorite candidate or outcome, then going through the motions of a transparent and equitable process so as to disguise the pre-determined choice. As an example, consider this from NZ academia. A well-known academic with international credentials is encouraged by the Director of a university research centre to apply for a newly opened position. The invitation is accepted, letters, resume and referee names forwarded, only to have the application rejected within weeks. When asked for the reasons why the application was rejected after the applicant was encouraged to apply, the Director stated that internal competition for the position was fierce and better candidates emerged. Months later it is revealed that weeks before the “search” began for a candidate, an academic at another NZ institution with ties to the Director was approached for the job and eventually awarded it. The international candidate “search” in other words, was a cover for the selection of the shoulder-tapped individual.

In another instance drawn from academia, a search committee was formed to find suitable candidates for a specific disciplinary sub-field. Unbeknown to two of the committee members, the other three members, including the Chair, as well as the external faculty representative, were all co-authors of  a husband-and-wife candidate duo vying to be short-listed. Not surprisingly the duo were listed as the best candidates out of ten finalists by their four co-authors. No conflict of interest is declared. When one of the other committee members discovers the connection and complains to the Faculty Dean about the clear conflict of interest involved in the search process he is given a warning not to disparage the professional integrity of his colleagues. But his protestations continue. The search ends with a compromise candidate being selected, but in the next year the Chair resigns and joins the husband and wife team at a foreign university while the whistleblower winds up being (as it turns out unjustifiably) dismissed on another matter in which one of the committee members with a conflict of interest played a decisive role . The Lesson? Interfere with a shoulder-tapping exercise at your peril.

This are just two illustrations from one profession. I have been told of or have seen myself dozens of other cases–including in such places as my old surf lifesaving club–where the shoulder-tap, with or without a wink and a nod, is used as a means for advancement under the cover of ostensibly “fair” elections, tenders and searches. Sports associations, voluntary organisations, service societies, public bureaucracy, the education system, unions, the media, local councils, the legal profession, political parties, a wide swathe of private businesses and business interest aggregators, perhaps even the Police and Fire Services, hopefully not the military–is there any part of NZ society in which this is not part of the unwritten norms governing career and personal advancement? My question then is: am I wrong in seeing something amiss here? Am I exaggerating the extent to which this occurs?

Likewise goes for the issue of sinecures. A sinecure is a position offered to someone that entails little actual responsibility and is awarded not on merit but as a form of patronage or reward for services rendered. In NZ there appears, again to my uninformed mind, to be a lot of sinecurism in virtually every walk of life. Ex-politicians, ex-bureaucrats and ex-ministers get comfy senior positions in state entities and private boards regardless of their backgrounds or records in a given field. Individuals with much private wealth but little other distinction serve on boards, committees and trusts. There is an affirmative action sub-type in which persons from ethnic minorities are awarded well-paid “honorary” positions or those mentioned previously regardless of their qualifications. From local councils to national-level politics and enterprise, sinecurism seems to be endemic.

NZ is not alone when it comes to such practices, so my question is whether these are just more obvious in a small (democratic) state when compared to a  larger one, or is the practice itself more frequent in small democracies, NZ in particular? 

It needs to be noted that these practices are not equivalent to clientalism. Although shoulder-tapping and sinecurism are seemingly endemic in NZ and can be considered to be institutionalised, they are not recognised as such and in fact occur beneath the mantle of egalitarianism, transparency and merit. They are therefore informal, nepotistic institutional practices that operate under the cover of a rationalist meritocratic Weberian ideal. Clientalism, on the other hand, is a formal institutionalised practice whereby political or personal networking lines combine with merit-based criteria into channels of upward mobility. Such is the case in the small state in which I live, where political allegiance to the dominant party is a requirement, along with professional competence, for career advancement in both the public bureaucracy as well as in state enterprises. In the private sector personal networks outweigh political ones in the clientalist scheme, but here too there is an overlap between the personal and political.

What is different is that in clientalist systems patronage is based on the combination of relative merit and political or personal connections. In the sinecure and shoulder-tap system patronage has little or no relationship to relative merit–it is in fact a non-meritocratic form of favourtism based upon ascriptive rationales of social advancement and mutual entitlement.

As I said before, I could be all wrong about this and am merely extrapolating widely from my own personal observations and experience. Nor would any of this matter if NZ were not a liberal democracy supposedly committed to fair play, social justice and equal opportunity. But since it is, and because Kiwis tend to think of themselves as being better on these dimensions than most other democracies, then my questions about the role shoulder-tapping and sinecures play in NZ society are worth consideration.

I shall leave for another post the prevalence of professional blacklisting in NZ, but suffice to say that I have some experience with it.

The Racial Basis of a Small SE Asian State.*

datePosted on 16:51, July 11th, 2010 by Pablo

From my perch in SE Asia I have observed with some bemusement what passes for immigration debate in the US, UK, Europe and NZ. I am bemused because the place that I live has a very non-PC approach to immigration and yet is held out as a beacon of ethno-cultural diversity, toleration and meritocratic entrepreneurship. Were it that it be so.

In most of the West the dominant discourse on immigration is phrased in terms of labour market necessity. Countries need skilled and/or unskilled labour as the case may be because their domestic reproduction rates cannot keep pace with economic growth. Since capitalism must grow to survive, it needs labour inputs to provide the human fuel for that growth. Depending on the human resource base of the country in question, skilled or unskilled labour is imported and allowed to settle in order to fill labour market demand and to increase inter-generational reproductive rates conducive to eventual labour market self-sufficiency. Or so we are told.

Yet there is a demographic aspect to this labour-market immigration strategy as well.  In the contemporary US Hispanics fill many of the unskilled labour needs; in Germany Turks do the same; in France Algerians fulfill that function; in Greece Albanians perform the role; in Portugal Romanians, Angolans and Brazilians play that part. In NZ it has been traditionally Pacific Islanders who fill the ranks of unskilled labour, and receive preferential immigration treatment as a result. Skilled labour shortages are filled by Indians, Chinese and Europeans in the US, by Spaniards, Greeks, Italians and Eastern Europeans in “old (Northern) Europe,” and by Indians, Asians and expat Europeans and South Africans in NZ (the list is not meant to be exhaustive and recognises overlap in skill categories in some instances). There is, in other words, an ethnic component to inter-state labour market migration.

The unspoken question, and the elephant in the room in such approaches to labour market necessity requiring the import of foreign labour, involves the intertwined issues of race, culture, ethnicity and religion. Until recently, with the exception of conservative or right-wing cultural supremacists, it was simply unacceptable to wonder out loud whether certain races, cultures or creeds were more or less likely to assimilate and contribute to the dominant culture and society of their adoptive countries.  Race-baiting politicians in the US, Europe and NZ have regularly played that card for electoral purposes, but by and large the majority of “proper” people in Western democracies prefer to not to confront the thorny issue of racial and religious composition of immigrants under conditions of labour market necessity. Yet not talking about it does not make the issue of ethnicity in immigration go away. Put bluntly, elites may see immigration in purely labour market terms, but the masses may just as well see it in ethno-religious and cultural terms, with all the baggage that entails.

The SE Asian country I live in has no PC qualms when it comes to the issue of work force demographics. This country is ethnically Chinese dominant (they make up 65% of the population). The ethnic totem pole then descends through Indians (the faithful lieutenants to the Chinese), Europeans (read: white people who are the managerial class for both local and foreign enterprise, and who are derogatorily called ang mor  or ang moh (red haired, which goes to show that NZ is not the only country in which “gingas” are reviled), other Asians (Koreans and Japanese preferably), Malays, Indonesians, Tamils, Sri Lankans, Ceylonese, Filipinos, Burmese and other sub-continental ethnicities. Immigration and reproductive policy is explicitly crafted to favour ethnic Chinese over all others when it comes to immigration, residency and citizenship. Because the country is labour-starved on both ends of the skill spectrum and the local Chinese reproduce at unsustainable rates, mainland Chinese and Taiwanese are given preferential immigration treatment even though the local Chinese look down their noses at their mainland counterparts as uncouth and unwashed uneducated provincials (their disposition is more generous towards Taiwanese but the attitude of superiority of Singaporean Chinese towards other Asians is pervasive). The country makes no secret of its determination to keep the present racial balance so as to maintain ethnic Chinese dominance, and makes no secret of what it sees as the superior cultural values of the dominant ethnic group (familial piety, ambition and discipline being foremost amongst the supposedly “Confucian” traits). For the rest of us it is a take it or leave it proposition, with money being the great leveler when it comes to attracting both top end and low end talent.

The very good public housing system is based on forced racial integration schemes, with the percentage of units allocated in any given housing bloc reflecting the proportional mix of ethnicities in the country. Although promoting racial and religious “disharmony” is prohibited by law and vigorously enforced in the main, racial integration and harmony are construed on Chinese terms and in their favour. From where I sit, it looks a lot like, albeit in a more disguised and benign way, aspects of the Jim Crow Southern US, except that here everything is written in Orwellian terms so that racial “harmony” actually means Chinese dominance. So long as everyone understands their place, play by the rules as given, bow to the rule of the one party state and accept material gratification and commodity fetishism as their reward, the racial status quo is preserved and the business of making money (or in the official jargon,  “pursuing prosperity”) can continue unimpeded.

Even so and despite the official line on racial harmony, racism is a constant latent fact of life here. Besides resistance to inter-marriage and barely disguised inter-racial contempt (particularly by the local Chinese towards Malays, Indonesians and Filipinos), things like housing blocs are divided in such a way that resident Malays can only sell to Malays and Indians to Indians, thereby depressing house prices and impeding upwards mobility for the majority of these subordinate groups. Non-citizens and non-permanent residents cannot own housing bloc units. Although there is much official palaver about being a meritocracy, the unspoken truth is that nepotism and patronage networks are equally if not more the key to economic success, and these unofficial channels are, given the demographics, Chinese-centric (although ethnic Chinese are not alone in the use of informal vehicles for economic advancement, nor is this phenomenon confined to this one state–NZ has its well-known system of old boy and new boy-girl networks that are anything but meritocratic). Here the bottom line is simple: accept the racial status quo as given and toleration of difference will be the order of the day. Challenge that status quo and run the risk of running afoul of the Internal Security Laws and their very broad definition of sedition. A pervasive system of domestic intelligence gathering, particularly but not exclusively focused on the resident Muslim community, ensures that challenges to the status quo are thwarted early and often.

Non-citizens and permanent residents do not receive anywhere close to the health, welfare and housing benefits accorded to citizens. To the contrary, they are actively discriminated against in allocation of public goods. This goes as much for the high end immigrants as for their low end counterparts, but it is only the former who have the personal income or corporate subsidies to cover costs in the private health, retirement and housing  markets (this is the case with most Kiwis, Australians and Americans living here). Low skill foreign workers, mostly coming from ethnics groups such as Tamils, Bangladeshis, Nepalese and Sri Lankans, do not have the financial resources to engage private care, so most often are deported with token compensation should they fall ill or otherwise unable to work (that includes pregnancy). Most low end foreign workers live in subsistence dormitories provided by employers who sign them to three year minimum wage contracts (some of these dormitories are converted shipping containers housing 30-50 individuals with a single toilet and shower). 

In fact, foreigners in general fall into three categories, investors, employees and dependents, with the first two being the only basis for residency. Should a foreigner lose his or her job or withdraw or lose their investment capital in the country, their visas are withdrawn and they and their families summarily issued orders of deportation (usually with a 30-60 day expiration date; overstayers are regularly caned as part of their punishment). In some cases, such as those of Chinese construction companies, foreign investors bring their own employees with them and subject them to their own labour standards via exclusionary clauses in local labour legislation. Add to that the very lax labour laws governing dismissals and redundancies, and you have a structural bias, in the form of labour market regulations and working visa controls, in favour of ethnic Chinese socio-cultural dominance.

I note all of this with agnosticism. Readers can make whatever inferences they choose to. The larger point I am trying to make is that here is a small state that is considered to be a model of capitalist development in the late 20th and early 21st century that uses an explicitly race-based labour market-driven immigration model in pursuit of the cultural, social and political dominance of the majority ethnic group. The system works; in fact, it is hegemonic by any definition.  Given that success, is it worth broaching the uncomfortable subject of cultural dominance when it comes to immigration in a place like New Zealand? Or is that simply a bridge too far and labour market logics should be the sole rationale (other than refugee quotas) upon which immigration policy is formulated and implemented? But if it is indeed unacceptable for a liberal democracy like NZ to use race-based criteria when confronting labour-market driven immigration  and social policy, then why does the NZ political-economic elite use my current country of residence as a developmental model or example to be emulated?

*Because there has been some misreading of the post in the comments thread, I have updated it in order to clarify some of the argument.

My partner and I are reaching the end of our sojourn in Greece and will be back in SE Asia by the end of the week. Her data collection and interview schedule have provided the follow-up material needed to finish the Greek chapter of her book (which includes Ireland and Portugal as the other case studies, a comparative project she started five years ago and long before anyone else noted some of the bases for comparison that now occupy so much attention). For my part, I have managed to glean some preliminary observations about civil-military relations in this fragile democracy, and in doing so have developed an idea about undertaking a comparison of post-authoritarian Greece and Argentina (although the specific focus of the project is still unclear and it will have to wait in any event until I manage to finish the current, long delayed book project as well as some articles in preparation or revision).

At this point I would like to reflect on an issue that I have previously written about in this forum (Sept 2009): the notions of Entitlements and Rights, in this case as they apply to contemporary Greek democracy.

If one thing comes across to this foreign observer, the Greeks have a tremendously developed sense of entitlements and rights. In fact they see them as one and the same. But they also have little sense of social responsibility. The prevailing attitude appears to be they everyone is entitled to express their opinions however they see fit regardless of whether it infringes on other’s security or dissent.  Everyone is also entitled to extract as much as they can from the state without having to help pay the costs of public goods (say, by paying taxes in full). The expressed view is not only that people are entitled to these attitudes (seen as a combination of opinion and behaviour), but that they have the Right to them.

Of course, this is an over-generalisation. Many Greeks do not impose their views on others and retreat into parasitic survivalism outside of their involvement in the public sphere. Yet at least when it comes to the intersection of political and civil societies, the tone is often “me/us first, the rest of you can get stuffed.”

What is interesting about this phenomena is 3 things: 1) that this notion of collective and individual entitlement is construed as a Right of all Greeks. Although nowhere is it written in the Greek constitution that people have a right to storm parliament, attack the police, property and standers-bye, or thrown molotovs into banks during demonstrations, it is generally accepted that such is inherent in the Greek way of expressing dissent or dissatisfaction with the status quo. These types of direct action are not seen as insurrection or low-level guerrilla warfare, but as something disgruntled Greeks simply do.

This attitude–that Greeks not only are entitled to get agro when they protest but have a right to, and that it is their right to not be held to criminal account for their violent public actions–is a product of the days in 1973-74 when the university student movement was instrumental, via violent clashes with the security forces, in bringing down the so-called colonel’s dictatorship that had usurped Greek democracy in 1967. Many of the leaders of that movement are now senior figures in politics, unions, the civil service and higher education. For them it was the resort to direct action, at considerable physical risk to themselves, that was THE decisive factor that restored Greek democracy. As a result, the role of direct action, including violence, has been mythologised in modern Greek political folklore, and even if stylised and ritualised in many instances, it remains central to the formation and reproduction of Greek political identities. In other words, to be staunch in the streets is to be Greek, and nothing can infringe on this inalienable right of all Greeks (immigrants are another matter). In a country that reifies its warring history regardless of win or loss, this is a powerful glue.

That brings up the second interesting aspect of this entitlements-as-rights phenomena: the government, including security forces, agreement with that logic. It is remarkable how the government accepted, for example, that the attempted storming of the Greek parliament on May 5 was a “right” of the protesters. Although it denounced the murders of three bank workers caught up in the demonstration violence, it did not specifically condemn the burning of the bank in which they were trapped.  Instead,  the government ordered that the parliament building be defended so that the debt rescue package could be voted on, but it clearly instructed the riot police to deal  lightly with the protesters and to not enforce basic criminal statutes outside of the immediate confrontation zone around parliament itself (and as I mentioned in a previous post about the general strike, may have negotiated with the communist-led unions to ensure that this occurred).

Nor was there a massive police cordon erected around the city centre, or police roadblocks and checkpoints erected at major road and rail access nodes to the downtown area even though it was a foregone conclusion that armed fringe groups were headed to the scene (and I must say that some of the Greek militant factions have truly marvelous names, such as the “Conspiracy of the Cells of Fire” held responsible for two bombings this weekend in Athens and Thessaloniki). In other words, with full knowledge of what would happen, the government confirmed the perception of entitlements-as-rights by ordering that security be limited and light.  Hence, for the moment, the military has played no role in internal security, which is left to two layers of riot police (one to prevent, the other to respond to violence), regular cops and plain clothes detectives and intelligence agents. However, if the pace of agitation continues, that attitude of military non-involvement in domestic security could well change (and it does not have to be overt, just decisive).

In effect, all political actors accept this particular interpretation of the Greek “me/us first, the rest be stuffed” broad entitlements-as-rights argument. Perhaps that is because there is also a fundamental Greek belief in the powers of collective and individual self-control. But nothing I have seen in the Greek streets suggests that self-limitation is a widely accepted national trait. To the contrary, the general attitude on the streets, both in the daily routine as well as during demonstrations, is that one gets away with what they can absent countervailing or superior power.  For those who have had the experience with them, Athenian street market vendors and taxi drivers are cases in point (and yet the market for both persists).

To put that in a comparative perspective, imagine any group in NZ claiming the right to throw molotovs, wreak storefronts  and storm parliament, and have that “right” not only accepted by any government of the day but also have that government order the police to refrain from using undue force on said protesters in the event they turn violent (to include limiting the number of arrests). Would that ever be feasible? For those so inclined, spurious comparisons with “wreakers and haters,” spitters, bum flashers, flag shooters and burners or street theater anarchists simply do not cut it.

That brings up the third, and most troubling aspect of the broad Greek interpretation of entitlements-as-rights (which if readers may remember my post on the subject last September are clearly not the same thing, nor should they be). Nowhere in this logic is there any notion of social responsibility, be it collective or individual. The entire argument is framed simply in terms of expected treatment and permissible behaviour, not in terms of social costs or collective mitigation of harm in pursuit of the common good. The absolutism of the claim of entitlements-as-rights and the absolute lack of relativity or regard for consequence are quite astounding. It is remarkable to watch and listen to people proclaim zero responsibility for societal ills, collective dysfunction or personal injury while demanding that their expanded notions of public and private rights be held sacrosanct. For this observer, the gap between what is demanded and what is offered in return is canyonesque.

And that is where my personal disconnect lays. As someone who recognises the legitimacy of violent direct action in the face of oppressive regimes, I fully understand the public need to physically confront the powers that be. But I also understand that there are costs involved in that form of expression. When one contravenes established  criminal law–often on purpose because it is a symbol of tyranny or class rule–one accepts that s/he has placed themselves outside of the law-as-given. One is thus a self-recognised “outlaw,” defined in old American Western parlance as “outside of the law.”  Being outside of the law of course means that one is liable to extra-judicial retribution, or at least criminal charge. Guerrillas  and counter-hegemonic activists of of all stripes understand this as they enter the fray and they fully understand the downside consequences of their decision to act (the Waihopai 3 notwithstanding). Having said this, it strikes me that the Greek state is more obese and arthritic than malignant and oppressive, so the resort to violent direct action on a near daily basis seems symptomatic of  a malaise not solely attributable to the Greek state.

And yet in contemporary Greece most everyone has a state-centred grievance and no one has a a claim on blame (or at least accepts even partial responsibility for social costs involved in the claim to entitlements-as-rights). For Greeks, collective costs are acceptable so long as immediate personal injury is avoided (this applies to bank managers as it does to unemployed youth). Rights of voice and expression are believed to be unfettered and encumbered only by individual preference, the consequences of which are to be borne by others.  Outside of exceptional cases involving ongoing public interest, public or private contravention of the law-as-given is generally held to be non-liable. A petrol bomb here, a bribe there–everyone is entitled to express their self-proclaimed rights in their own way and others should beware and steer clear. There is collective tolerance of that view. Governments come and go indulging such attitudes as the miminal cost of rule. Greeks that understand democracy as a substantive and procedural compromise can only ponder this, shrug their shoulders, and silently weep.

All of that may change now that the crisis is upon the Hellenic Republic. What may have been permissible in better economic times may no longer be so as the burden of sacrifice begins to wear on the fabric of Greek society. As austerity bites into the great mass of Greek workers the resort to survivalist alienation in the private sphere may give way to a defensive overlap between collective and private notions of entitlements-as-rights, drawn along lines reminiscent of 1974. Should that occur (and there have already been calls from ultra-nationalist groups for the military to act), the logic of entitlements-as-rights spawned by the events in 1974 could well be replaced by a military counter-version in which it is entitled, and has the right, to intervene in government in order to “save” the nation from itself, even if on a temporary basis.

Improbable as that may seem (and it is), such could well be the future price Greeks might pay for confusing a broad conception of entitlements with civil rights devoid of civic responsibility. Let’s hope not.

Epilogue: This concludes my posts about Greece. I may have more to comment on this fascinating country down the road but for the time being I must contemplate a return to the authoritarian (yet efficient and clean!) tropics. Which brings up the question: is it better to live peacefully and comfortably without real voice under authoritarian aegis, or is it better to suffer disorder and inefficiency in a democracy in which voice matters more than anything else? That is the perennial question of transitional political societies.

PS: My partner says that the syndrome is much more individual than collective, and that participation in collective action is a convenient cover for individualist self-projection using the ideological justification of rights to unfettered voice (rather than a genuine concern with collective gains). I disagree to some extent because I think that repeated involvement in direct action modifies the very notion of self (for better or worse), but that subject is for another discussion. In the meantime I defer to her superior knowledge of all things Greek.

Its all Greek to me.

datePosted on 22:49, May 3rd, 2010 by Pablo

There is a political rhythm to the Greek economic crisis. We spent a long weekend on Santorini dodging strikes–Tuesday was the transport workers, Wednesday was the wharfies, Saturday was the May Day demonstrations. Next Wednesday there is a general strike. Our timing has so far been impeccable. We took a ferry last Thursday, so missed the wharfie action that paralyzed Pireus and left a bunch of cruise ship passengers stranded. We returned on Sunday evening so missed the May Day demonstrations that disrupted the Metro rail. We fly to Samos this upcoming Thursday, so will miss the general strike as well. Fingers crossed that nothing happens next Monday, when we fly back. Given recent strike patterns, Monday is due for one so our luck may run out (not that getting stuck on Samos is a bad thing). But we are getting the hang of the flow of things and look forward to seeing how the general strike goes. Although the foreign press has focused on some violence, the reality is that it is only small groups of anarchists who are clashing with the police, and most of them are teenage students. The unions and other civil associations are led by grey haired folk who may have been prone to street action two or three decades ago, but who now are just trying to protect their collective livelihoods (although two banks were attacked by petrol bombs last night, the usual anarchist and Marxist-Leninist suspects are being blamed).

What is interesting about the unfolding of the Greek economic crisis is how ignorant most foreign observers are about its root causes. Most focus on inefficiency and waste in the public sector and the supposedly indolent Greek way of life, which even if true has its causes in something other than the Greek psyche (as some allege). Let me explain.

In the 1950s a strain of developmentalist thought emerged called modernisation theory that claimed that the problem of Latin America and the Mediterranean Rim was a lack of Anglo-Saxon Protestant values resultant from the mix of rigidly hierarchical religious cultures (Catholic, Muslim or Orthodox) and warm climates. The general drift of this “theory” was encapsulated in the so-called Iberian or Mediterranean Ethos: a culture of indulgence, indolence, patronage, clientalism and fatalism structurally rooted in a benign climate that allowed for easy shelter and food production. If only the Greeks, Italians, Spaniards and Portuguese (which actually is not on the Med) had to live in cold climates where survival depended on industry and resourcefulness–then they would have developed the “proper” entrepreneurial values that would have allowed them to develop along the “proper” lines of the Anglo-Saxon world. In other words, backwardness is a function of culture and climate.

Leaving aside the fact that there are plenty of temperate climate locations where entrepreneurial spirits have flourished, and plenty of cold climates where it has not, or the fact that lumping together whole regions in a culturalist explanation is ignorant at best and racist at worst, or that the notion of one universally ‘proper” form of development is both, this discredited canard ignored the structures of economic and political power (many overtly shaped by foreign intervention) that emerged in these regions and which were not reducible to either climate, religion, or civic culture.

By the 1970s modernisation theory was shown to be profoundly flawed. On a scale of over-determinism (when not cultural supremecism), it is up there along with the “warm water port” theory of imperialism. Yet, in recent years, and specifically with relation to the Greek crisis, it has been resurrected in revamped fashion as an explanation for developmental failure. Inspired by neo-liberal thought, the neo-modernisation thesis is that countries with “too much” state involvement in the economy are prone to political nepotism, rent-seeking, corruption and inefficiency. That makes for a lazy, supplicant, and favour-seeking society. The key to development lies in reducing the role of the public sector so that private enterpise can flourish. The private sector is seen as THE panacea for developmental retardation, and elites in places like Germany believe that the Greeks need to accept this.

While there may be some truth to the need for private sector leadership,  the root causes of the current Greek crisis are, again, not as simple as the overbearing role of the state, nor is the solution simply a matter of reducing it.

As I mentioned in the previous post, Greece has an underdeveloped private sector. But–and this is a very big but– the weakness of  the Greek private sector preceded rather than followed the advent of the modern Greek state, and the private sector never attempted to become the motor force for the entire society. If one considers the nature of internecine conflict in Greece dating back two  milenia (for the historically disinclined, please think about Athens and Sparta, or better yet, the Peloponnesian Wars), one realises how parochial local, sectoral and island interests can be.  That worldview continues today. Greek private industry, such as it is, has little concern about contributing to the public good. 

In light of Greek capitalist myopia and parochialism, the recipe for social peace has rested on the public sector being used as a means of absorbing excess labour (along with emigration). The labour market and welfare systems are two-tiered: there are few protections for workers in the private sector outside of employer generosity or union strength, while the public sector adheres to ILO standards. Tax-evasion is a national sport, but the problem is not with individuals but with politically-connected corporations and agricultural interests as well as religious organisations who do not pay anywhere close to their due share of the tax burden but who do put serious money into the main political parties and individual politicians in order to protect their profits (since the money spent on politics is infinitesimal when compared to the valuated tax assessment of their worth). In order to conceal the results of this long-standing practice, successive governments, be they centre-right or centre-left, cook the Treasury books and leave it for their successors to sort out, in what has become an elaborate wink and nod shell game played between themselves and their foreign creditors.

Greeks are by and large a nation of small property owners. Owning a home is, like in NZ, their core objective. The private sector is dominated by small and micro-enterprises run by owner-operators (often familial in nature) who eek out small margins catering to immediate needs (think dairies, dry cleaners. locksmiths and the like). The state does not direct investment capital towards these people, not does it particularly focus investment in large corporations either. What large-scale investment exists comes from foreign-connected sectors such as shipping, and much of the profit generated by the handful of such firms goes off-shore.

To this can be added a large black market fueled by unchecked migration across Greece’s incredibly porous borders. One in ten inhabitants in Greece are foreign born and the majority are undocumented.  This cash economy circulates outside the confines of the state (remember my anecdote about the gypsy street fair in the last post), yet is vital to filling the demand for basic necessities as well as for labour in the agricultural and service (including tourism) industries. Relatively little of the economic activity generated by these non-citizens provides revenue for the state, and with little immigration enforcement available (and largely impossible to regularise in the near term), that situation will only get worse as the official economy shrinks under the austerity regime now being imposed.

Thus the historical source of income stability (at least since the end of the colonel’s dictatorship in 1973) are public service jobs. But without an efficient tax system owing to the political cronyism of the major economic players, public budgets require external financing, which has led to more than two decades of deficit spending happily financed by foreign financial speculators trading in risk derivatives. The idea behind this play, which I accept, is that while firms may go bankrupt nations do not. Compounded interest ensures the investor’s profitability even if the principle is lost in a default (as Argentina showed in 2001-02). So the bottom line is that the system now under siege worked for everyone–the Greek elite enjoyed its privileges, the Greek population remained relatively content and peaceful even if economically underdeveloped by modernisation theory standards, and foreign financiers made money off Greek debt.

The trouble is that with the creation of the Eurozone currency system controlled by one central bank, countries such as Greece were placed in a financial straitjacket that eliminated the autonomy and cushion provided by independent national currencies.  It cannot devalue or overvalue its currency based on market conditions (as for example, Singapore does regularly), and thus is locked into a monetary (supply and demand) framework over which it has not control. Hence, should it default on its debt to its European backers, one major option would be to defect from the Eurozone and re-establish its national currency. There will be pain involved but it would allow Greece to reorganise its finances in more independent, if austere terms. It has enough investment to ensure that even with defection it will not sink (consider that tourism constitutes 20 percent of the Greek economy and its limited niche export markets could actually be favoured by such a move). That in turn might encourage others, particularly the other members of the so-called “Club Med,” to follow suit, which could well spell the end of the Eurozone (especially when considering that a Tory victory in the UK will mean an end  of talk of its ever joining and that Turkish incorporation into the EU could set the stage for an even bigger Greek-type scenario). Thus the Greek bail-out is not so much about Greece as it is about protecting the Eurozone as a currency market.

Which means that the strikes are going to continue, at an increased pace and on a potentially broader scale. In the face of elite indifference to their plight, it is the only means of defense for most Greeks. They have just been told that the public sector will take a 25 percent wage cut on top of a ten percent cut six months ago, then have wages frozen for three years. Imagine if that happened in NZ. Do you think that even the placid Kiwi public worker would take that lying down when s/he had no part in the deficit debacle? The retirement age will also rise while pension benefits will be cut. Although most people appear to accept the former, the latter is a major source of aggravation because as I mentioned before, there is little to no private sector pension plans. Prices of public utilities are set to rise and there is talk of privatising the bulk of the health system (which already is a two-tier system in which private health providers are used by the wealthy). All of which is to say that the burden of sacrifice will be shouldered by those who had nothing to do with creating the crisis in the first place. In fact, although improvements in tax enforcement are mentioned, that remains to be seen, and nowhere has it been mentioned that politicians will take a wage cut or corporations will be required to offer non-wage employment benefits in order to off-set cutbacks in public benefit programs while encouraging labour migration to the private sector. 

Which makes me think that the recently announced IMF/ECB Greek rescue package is more cosmetic than substantive and could well provoke a public backlash that could provoke renewed military interest in internal security. That, indeed, would be a disaster.

Note: As always, my observations on Greece are indebted to the insight of my partner as much as my own. I will take blame for any errors.

PS: I have been thinking of writing a post about our brushes with petty crime and come curious Greek mores, but do not want to turn this into a travelogue.  I shall try to integrate any such thoughts into a larger discussion of more serious subjects.

They have to want it as much as you do.*

datePosted on 06:51, April 27th, 2010 by Pablo

I spoke with an old Pentagon friend today (a person with whom I shared strategic planning duties in a specific area of concern, and who went on to far greater things than me), relating to him my early observations about Greece in crisis. I mentioned that the Greeks, who have a public sector that dwarfs the private sector, in which the public sector average wage is far above that of the private sector, have a huge sense of collective entitlement and natural rights. For example, university students (as public entitles) are currently demonstrating daily against proposed cuts in their free lunch and bus pass benefits, but not at the university. Instead, they disrupt downtown traffic. Tomorrow the seafarers, bus drivers and railway workers go on a 12 hour strike to protest wage freezes or labour market infringement  (the train and bus workers are public servants facing wage freezes and the seafarers are striking to protest non-EU ships being allowed berthing rights in Greek ports. Their combined walkout will paralyze the transportation network for 8 hours ). 

But media coverage of the issues is somewhat odd. Rather than look inward, the popular press is full of anti-German rants because the Germans will determine the conditions of the Greek debt bailout (which only delays the inevitable default), and the conditions imposed by the Germans (as majority holders of Greek debt) are considered to be the reasons why Greek workers will not get their entitled, perfunctory raises.  All the while  life goes on–the cafes and supermarkets are full, people crowd the trains, there are few demonstrations outside downtown. People do not appear to connect the impending default to their lifestyle.

Usually wages are tied to productivity, which means that if the public service is well paid it is also efficient (such as in Singapore). But in Greece it is not. From what I have observed and what my Greek interlocutors have told me, nothing gets done or it is waste of time to demand action. For example, on Saturday an illegal gypsy market spung up on the street outside our apartment building. It closed the street to vehicular traffic and vendors camped out on the apartment footsteps. The neighbours shut the front entrance doorway, which is usually propped open, out of fear of robbery. I asked my landlord if that was commonplace and she said that yes, although illegal the gyspy market had run for years because neighbours had zero success in complaining and bribes may have been paid for the authorities to look the other way (which indeed they did–I saw not a single cop during the entire afternoon the market was running).  In other words, Greek public service is as much a hindrance as a help to civil society, hence the proliferation of grey and black market activity. The curious thing is that this situation is tolerated by both of the dominant Greek parties, respectively left and right centre as they may be, because public sector employment and benefits is a common source of patronage and clientilism. Neither one wants to upset that apple cart (even if the latter is foreign debt-bought and effectively owned). 

Mind you, not that all Greek public services stink. When compared to the Auckland raillway system, for example, the Athenian Metro is stellar. There are few delays on the six inter city lines, complete integration with buses and suburban rail lines, and close integration with ferry and airport schedules. The only visible problem, from my non-expert viewpoint, is that there appears to be way too many people (or too little, depending on the station) doing nothing in pursuit of this goal. Then again, I tried the Henderson-Auckland (before and after Britomart) route for years, before and after it was privatised,  and the public-controlled Athens Metro system has it beat by a country mile.

Not that the Greek private sector is a beacon of innovation and entrepeneurship. To the contrary, it is mostly low skilled small holdings with no growth or technological ambition (think butchers, cosmetic vendors and locksmiths), and the political-economic elite (they are the same, crossing familial ties in many instances) in this rigid two party system have no interest in promoting the sort of capitalist ambition that would erode their joint lock on power. Cuba is similar in this regard, because in both cases oligarchic control supplants popular innovation as the motor of progress and majority consent is bought with public sector employment (not that I am drawing a direct line between the two regimes as a whole).

Which is to say, Greek economic backwardness is cultural, contrived and perpetuated by the Greek status quo. The elite see no need to change because deficit spending is a double edged sword, as many US banks found out to their dismay. Deficit-laden countries intimately locked into the European financial system such as Greece will not be allowed to collapse  becuase if they do the financial run is on given that Spain, Portugal and Ireland are all in the same predicament–too much debt, too little ability to pay within IMF/ECB guidlelines.  Hence, Greece may default, but it will not be allowed to financially collapse if for no other reasons than that the repercussions would be catastrophic on the European banking system itself.

Which is where my fomer Pentagon friend comes in. I noted to him that the problem with EU expansion is that the leading EU economies, France and Germany, viewed EU monetary expansion into Southern and Eastern Europe as a development project in which the lagging peripheral economies would be modernised by virtue of their connection with the European core (first via labour-intensive investment, then by value added industrial growth). The Euro giants emulated the US when it engaged Latin America in the 1960s and 1970s under the rubric of modernisation theory: just expose the backward masses to a little capitalist entrepenurialism and all will eventually be right.

Err…wrong.  As my friend noted, the locals have to want the change as much as we/you (external agents) do. And that is a cultural issue more than anything else. 

Developmentalist views such as that of the EU and US ignore the cultural component of investment climates. National preferences are different, cultural mores vary, and collective notions of rights and entitlements are not transferable across borders. The Germans and French may have thought that lending money to Greece to fund the Olympics would promote its modernisation, but like the Yanks in Latin America, they failed to understand that Greek culture–what it means to be Greek–supercedes any IMF/European Central Bank prescriptions. Hosting the Olympics was temporary; to be Greek is forever, and that is not reducible to a current deficit repayment schedule. To the contrary. It is reducible to notions of rights and entitlements crafted over milleniua and mytholoigised as such. That bottom line is not within an IMF  or European Central Bank purview.

Which is why my friend Ray’s point is well taken: an external actor can only help as much as the locals want to help themselves. There is no point in offering assistance and prescriptions if the locals do not see the need to change. Absent a local consensus on the need for change (which can be influenced by externally driven media manipulation but which ultimately has to resonate in the hearts  of the citiznery) better then  for external actors to cut bait than to engage in futile hope that the local conditions will change.

In fact, the opposite may be true: the less a country is propped up by external actors and the more it is forced to look inside itself for solutions, then the more it may eventually address the root causes of its backwardness, decline or stagnation (New Zealand could well be a case in point). In any event, only after internal failure is acknowledged that external assistance will make a difference in Greece or elsewhere, and that difference is not material but attitudinal.

 According to my buddy, that fact is as true for Greece as it is for Somalia, Irag and Afghanistan, and in the latter instances, the stakes are arguably much greater. I disagree with his summary assessment as it applies to Afghanistan (as I believe that there is more at stake than local self-realisation), but cannot help but recognise the truth in his words. At the end of the day in this age, no matter the degree of previous exploitation and subserviance, the root problem of backwardness lies within. Or to put it in my friend’s terms, “if the locals do not want to do it, it aint gonna happen.”

There is truth in that view and no amount of good intentioned external help will resolve the fundamental issue.

*Update: For a jaded by humorous view of Greek politics check this out.

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