Update on the European Monetary Union: Spain, Italy, Greece

Developments have been occurring rapidly in the ongoing crisis in the European Monetary Union since my last update.  First, Spain asked the European Union for and received a bailout of its banks.  However, the move undermined confidence in the ability of the Kingdom to repay its sovereign debt, which, along with the ongoing debt crisis in Greece, caused its borrowing costs to spike, as did the Italian Republic’s, despite the reforms that both the Spanish and Italians have successfully implemented and the progress they have made in reducing debt, despite their anemic growth.  In the latest example, the Italian parliament approved a controversial labor reform law, according to ANSA, that gave businesses more flexibility in firing workers, although the measure was diluted.  It was proposed by Prime Minister Mario Monti as critically necessary for Italian fiscal and economic health.

The two Southern European states demanded that the more fiscally responsible Germans and other Northern Europeans agree that the European Central Bank make available loans to ease Spanish and Italian borrowing costs.  They argued that because of their good behavior, they did not deserve to pay higher interest rates, unlike Greece, which is in worse fiscal condition and has not met its commitments.  Investors in sovereign debt have demanded high interest rates for bonds issued by the two states as a premium for higher perceived risk as the crisis continues.  The loans would not represent an embarrassing bailout – with the usual heavy oversight –  because Spain and Italy have complied fully with all the demands of the Europeans to improve their fiscal condition.  The Germans have acceded to the demands, as long as the Spanish and Italian governments continued to reform, as Spain and Italy, with their large economies, are recognized as the European Union’s firewalls against the contagion of debt from Greece and others. There will also be some consideration given to Ireland for a similar deal. 

Meanwhile, the second parliamentary elections in Greece averted the crisis, for now, of a Greek exit from the Euro.  Although the far-leftists who had done well in the first election had promised to keep Greece in the Eurozone, their demand to renegotiate the Greek bailout by the European Union was recognized as what would have been a breach of the terms of the deal that would have resulted in a Greek default on debt and subsequent exit from the Monetary Union.  The conservatives, who had backed the bailout and its necessary harsh conditions of austerity, won a plurality and were able to from a new government with the third-place socialists, the same two parties who were previously in a coalition government before the last election.  The victory was achieved despite the deep five-year recession and the record of overspending and budgetary dishonesty of both parties that had resulted in the crisis in the first place, as well as the unpopularity of the austerity measures. 

Nevertheless, by the time the new government was formed, it had become apparent that new terms of the bailout would have to be negotiated, such as an extension of the length of the term in order to reduce the Hellenic Republic’s borrowing costs, as well as other measures, such as some tax cuts and increases in pay in order to ease the pain of the recession and spur economic growth, which, in turn, would improve Greece’s fiscal health.  As a result, the withdrawal of funds from Greek banks has reversed and Greeks have begun to file tax returns more than before.  The European Union is open to modifying the deal, but only if Greece continues its austerity program to reduce its debt.   The elections and formation of a government have reassured the markets somewhat because of the aversion of a disorderly Greek exit from the single currency, but the future of Greece in the Eurozone remains unresolved not only until the bailout is renegotiated, but also whether or not the Greek government is successful in reducing its sovereign debt. 

The more liberal Europeans have argued for greater European integration to resolve the crisis, while the more conservative Europeans have resisted paying the debts of their profligate spending neighbors, as I have posted previously.  What is remarkable is how the left argues for more integration – “more Europe” – even as the grand project of European integration has been revealed as the reason the crisis has worsened and become continentalized.  To them, there was never enough European integration in the first place, as the problems were only caused by mistakes in establishing the union.  It reminds me of liberal Americans who argue that the trillions of dollars spent on poverty alleviation efforts that have been exposed as catastrophic failures were simply not enough and that far more is needed.  To the left, it is never enough.  It will be, however, when the money runs out. 

More Media Errors, 2012

I have decided to continue my series of posts on errors committed by the media.  See also my posts, Media Errors on Iraq and Afghanistan, from March of 2009, http://williamcinfici.blogspot.com/2009/03/media-errors-on-afghanistan-and-iraq.html, Misleading Media Phrases, from May of 2009, http://williamcinfici.blogspot.com/2009/05/misleading-media-phrases.html, and More Media Errors, from August of 2010, http://williamcinfici.blogspot.com/2010/08/more-media-errors.html.   Most of the errors identified in this post have been initiated by the media, but some are often committed by the public and have been propagated by the generally ignorant media. 

“Robbery” vs. “Burglary”

Robbery is theft by violence or threat of violence, whereas burglary means breaking and entering into a property for the purpose of committing a crime therein.  Note: the crime a burglar intends to commit need not necessarily be theft.  The difference is between a violent crime and a non-violent crime, a felony and a misdemeanor.  Additionally, a building or vehicle cannot be “robbed,” as only people can be robbed.  The confusion the media causes by failing to make this major distinction between the two crimes causes many people to misreport the crime when contacting first responders, which triggers an incorrect response on the part of the first responders.

“Town Hall” vs. “Town Hall-style”

A town hall meeting is an official assembly of residents in order to govern their municipality.  Elected officials, other than municipal officers calling a meeting for such a purpose, who conduct informal meetings with citizens, are not thereby exercising such an administrative function.  Furthermore, candidates for public office cannot exercise any such power.  Such elected officials or candidates, therefore, when convening an assembly in which questions and comments are taken from the floor thereby conduct town-hall style meetings, not “town hall meetings.”

“Imploded” vs. “Collapsed”                                   

            An explosion is the violent ejection of matter from the point of its source, whereas an implosion is the drawing in of matter to that point (such as the filling of a vacuum).  The confusion about the proper usage of implosion arises from the metaphoric use of that word to describe a demolition as if by implosion, whereby the explosive charges are set in such a manner that the building collapses upon itself, instead of outwardly, in order to avoid collateral damage.  As a result, many people wrongly associate implosion with a collapse, especially one that is upon something’s own weight, and thus consider these two unrelated words as synonyms, or at least that implosion is an appropriate metaphor for such a collapse.

            Therefore, many people, especially in the media, describe various events as examples of something having “imploded.”  For example, they describe the collapse of the Communism and the breakup of the Soviet Union as an “implosion,” but the opposite was true.  Neither Communism nor the Soviet Union attracted anyone or anything towards them, but repelled people away from them as they were revealed to be unattractive.  They collapsed both by their own weight and a significant push from the efforts of anti-Communists.  Indeed, it would be expressed better, for example, that the Soviet Union “exploded,” as its constituent parts all broke away, but for the fact that they left willingly instead of being violently ejected.  Similarly, it was stated that former United States Speaker of the House of Representatives Newt Gingrich’s campaign for the Republican nomination for President had “imploded” in 2011 when much of his senior staff resigned.  Again, this example is one of a collapse, not an implosion, as his campaign was not drawing anyone in – until later, when he was twice the frontrunner, which suggests that the resignations did not even truly represent a collapse, but a restructuring.  More recently, the Democratic Party has been described as having “imploded” for its losing effort to recall Wisconsin Governor Scott Walker, a Republican.  Although the election did draw in funds and volunteers to both sides, it is more accurate to describe the losing party to have “collapsed” than to have imploded, especially considering that the successful Republicans drew in more ideas and funds.  None of these examples come close to representing implosions.

            The example of describing Greece as having “imploded” is a less inaccurate example.  Although the metaphor is intended to explain the Greek fiscal and economic collapse, a true monetary implosion is taking place, in a sense, as Greece draws in loans of hundreds of billions of euros from the European Monetary Union and its supporters in order to bail the Hellenic Republic out of its crisis.  Nevertheless, the media is using the incorrect metaphor of implosion in order to describe what it identifies as a collapse. 

            I daresay that much of the media is itself in the process of collapsing, not imploding, as people are drawn away from it instead of toward it.  The only thing the media is drawing towards itself is shame for its bias and ignorance.

William Cinfici: A Successful Conservative School Director in an Urban District, Part III

           Despite being in a minority of two Republicans out of nine members of the Reading School Board of Directors, I was nevertheless successful in achieving significant accomplishments as a result of my principles and the practices I described in Part II of this series of posts.

            I was able to keep my promise of reducing some wasteful spending in order to avoid a tax increase, without sacrificing the quality of education, despite addressing the challenges I mentioned in Part I of this series of overcrowded schools and crumbling buildings, as well as an insufficient (and illegally inadequate) level of support for special education and a lack of adequate safety and security.  In fact, there were even improvements to the education equality during my term, among other positive results.

            Money was saved in a number of ways because of my suggestions, ranging from several hundred to tens of millions of dollars.  Facilities and labor costs were held down, in particular, such as my questioning the need for building six new elementary schools and the offering of less expensive health insurance with increased coverage for employees.  Also, better financial controls were instituted and policies I spearheaded were approved to increase openness and transparency and reduce waste, fraud and abuse: the Board adopted the stronger anti-fraud policy, and the conflict of interest and whistleblower protection policies I championed, as well as a policy I initiated to limit trip expenditures to the Internal Revenue Service per diem guidelines and to improve the policy for facilities usage.  I also led the successful effort to adopt policies for open records, document retention and for requesting bids for goods and services and to improve the policy for employee use of school vehicles.  As a result, the District has not raised real estate taxes in a decade.  It is important to understand that these savings came despite the liberal tendency to spend money in order to do good or to prove one’s commitment to a particular priority, and to reject small savings as insignificant, coupled with the bureaucratic mindset that if the money in an agency’s budget is not spent during the fiscal year, a lesser amount will be appropriated for that agency the next year.

            The quality of education was improved by the establishment of more programs, higher standards and more staff training.  There was also more focus on results.  I identified errors in the proposed high school history textbook.  The school discipline codes and student handbooks were dramatically approved because of my input to the process.  My suggestion was adopted to provide for customer feedback from students in order to improve education.  I was also one of the leaders in drastically reducing the counterproductive lengthy line to process tardy students at the high school.   

But before the quality of education could be addressed, it was necessary to improve the safety and security for students.  The two of us conservative Republican School Directors were successful in protecting students from obscene art at our District-owned Reading Public Museum by getting the Museum Foundation to agree to keep obscene art out of children’s reach and to post warning signs, despite opposition from most of the rest of the Board of Directors.  I was successful in getting the District to install carbon monoxide detectors in the schools, despite resistance from administrators for this initiative.  I also supported my Republican colleague’s successful initiatives to increase cameras, security guards and police in the schools.  One of my ideas that was implemented was a student I.D. card swipe for building access at the high school.  A policy I spearheaded required that all volunteers in unsupervised direct contact with students obtain their state child abuse clearances.           

            Our support for a conservative Democratic colleague’s proposal to restore the names “Christmas Break” and “Easter Break” to the school calendar resulted in a favorable compromise: “Winter Break” and “Spring Break” were replaced with “Holiday Break,” which at least reflected the religious origin of the state and federal holidays.  I was also successful in my initiative to treat Columbus Day the same as other official holidays, either by inclusion of it in the curriculum or by a day off from school, which was accomplished by the scheduling of an in-service day on Columbus Day.  Both of these initiatives were especially appreciated by the public and staff.

            Although my efforts to increase openness and transparency and improve fiscal controls to allow greater accountability and eliminate waste, fraud and abuse were partly successful, as I mentioned in Part II of this series, the liberal Democratic majority of the Board resisted more serious efforts to eliminate corruption in the Reading School District.  Similarly, although the spending cuts I proposed helped avoid tax increases, the Board treated the increase in funding the District received from the Commonwealth of Pennsylvania under Governor Ed Rendell, a Democrat, as an opportunity to go on a spending spree.  The Board was unprepared for the return of pre-Obama stimulus levels of funding under Governor Tom Corbett, a Republican, despite my warnings of an eventual change in governor or the legislature, or at least the end of their tolerance of wasteful spending, and my reminder of the temporariness of the Obama stimulus. 

Nevertheless, I can say that matters would have been worse without my efforts, which served as a model for reformers, conservative or liberal, to establish good government.  Indeed, several moderate Democratic candidates with whom I campaigned in 2011 for school director on a reform platform were victorious, although my loss left them short of a majority.  I continue to advise them and stand ready to serve again should I be called upon to fulfill my duty.   I have proven that a conservative elective official – even in a minority within an elected body – can be successful in an urban district.  I hope this series of posts inspires other conservatives in urban districts to seek elective office and reformers of any ideology in public service to eliminate waste, fraud and abuse.  

A Lesson from the Baltics for Southern Europe and Obama

An interesting article on CNBC’s website today contrasted the rest of the European Union with the relative prosperity of Estonia, despite the Estonians’ entry into the European Monetary Union in 2010.  The state is enjoying robust growth and low unemployment.  The other Baltic States, Latvia and Lithuania, which are not part of the Eurozone, are also prosperous.  The reason these three former Communist states are enjoying prosperity is their government policies of austerity, i.e. cutting government spending, without raising taxes, which has held down public debt in the Baltics to far lower levels than in Western Europe, and their people’s willingness to sacrifice in order to avoid worse problems.  The low debt which keeps interest rates low naturally, coupled with the pro-business environment, makes the Baltic States attractive to investors. 

In my update on the Monetary Union last month, I observed the rejection by many Greek and French voters, among others, of austerity policies.  United States President Barak Obama has also voiced opposition to austerity, just as he supports increased federal spending (“economic stimulus”) instead of reducing unnecessary spending.  The Baltic States are proving the Southern Europeans and Obama wrong.  Austerity does work.  Indeed, more public spending only exacerbates the problem.