September 26, 2011

The World Economy: the looming crisis

Writing about web page Economy, sovereign debt crisis, banking crisis

The world economy is at the precipice, in dire straits, at the verge of a meltdown or whatever the new buzzword used by commentator and the proletariats alike for the current state of the economy. Some might say this crisis highlights the failure of capitalism (to me this view is rather extreme), while others see it as the consequence of the greed of financiers (bankers chiefly), the failure of government to act both as a regulator and the guarantor of last resort.

I am not here to pontificate or proffer solution as many eminent minds have done that (not that I shouldn’t because my guess is equally as valid as theirs in light of how often they got it wrong), however I want to highlight the troika of problems that the global economy faces and how our philosophical view of growth and the economy needs to be re-examined in order to get out of this quagmire.

On the unset of the banking crisis caused as a result of sub-prime lending and complex financial instruments in 2008, the concern of world leaders was to patch things up and make sure that the economy did not collapse. At that time, it was the sensible thing to do, however, all that it did was to push the day of reckoning further down the line.

In 2008 it was only the banking crisis, today, it has metamorphous into a troika of problems namely:

1. Sovereign debt crisis

2. Low growth and unemployment crisis

3. Banking crisis

We were told in 2008 that the banking crisis could have resulted in the death of world finance as we know it, then imagine if these three crises today are allowed to spiral out of control what superlatives will be used to describe such an economic nightmare.

The philosophical argument is thus, we have been made to believe that economies must grow as we advance in technology and human innovation. This in an ideal and a closed system is feasible and the argument could be offset by lack of growth in Europe and the US with growth in the BRIC nations, Asian Tigers and other developing economies making the system in perfect equilibrium. This is however not the case, we are working less, personal responsibility is being abdicated, growth in the value of assets especially homes are over-inflated and other ills in the global economy yet we want to carry on as if things are all OK. In the name of maintaining the fallacy of continued economic growth, governments and individuals alike borrow to keep up the fallacy and the day of reckoning is finally dawning upon us.

On the European sovereign debt crisis, Greece should be made to default so that it can restructure its debts into something that it can manage. This should first be done by Greece getting out of the Euro monetary union and adopting back its old currency the Drachma. It should then default and restructure, pegging the currency to the Euro paving a route back to the currency when it has sort out its house. This will be in line with what Argentina did in during its sovereign debt crisis between 1999-2002. The parallels are not the same in the sense that Greece is in a monetary union as such cannot be compared to Argentina as some might opine, thus the idea that Greece should readopt back its currency which was a lot lower than the value of the Deutschmark, the eventual value of the Euro.

On low growth and unemployment, I will advice the young generation to look towards a future where the notion a job for life with entitlements upon retirement as an outdated model of a bygone era, rather we should look towards aligning with each other to form new and novel ventures that will make us self employed with the raft of new tools - mainly the internet - that are available at our disposal rather than waiting to be on someone’s payroll. The future of employment will be governed by the well-educated and supremely talented commanding wages and remunerations of significant proportions while rest must look up to fending for themselves or being on unemployment benefits.

On the banking crisis issue, the processes and mechanisms of modern banking needs to be fundamentally changed so that banks act as facilitators for growth in the real economy i.e. manufacturing, agriculture and other sectors rather than the engine of growth in which value is not created or added to as they are today.

The main distinguishing factor that made the human race superior to other beings is not only our intelligence but our ability to adapt to our environment be it physical, intellectual or emotional as such this crisis will one day be looked at by future generations as a blip on the economy but only if we wake up to the realities, change our world view and look for a sustainable solution through global collaboration and overhauling of the financial system rather than tweaking of processes as we are currently doing. 


April 26, 2011

Arab Spring

The current uprising/revolution in the Maghreb and the Arabian Peninsula has caught most commentators and indeed the world by surprise both by its nature, speed and the casualties thus far. To most western commentators their view of a revolution in the Arab world is that of "Wild-eyed young men shouting bellicose verses from the Qur'an as they hurl themselves against authority, armed with anything from rocks to bomb vests" to quote Time magazine. However the nature of the revolution is far from that, as the protesters seen on the street of Tunis, Cairo’s Tahrir Square, the Pearl Roundabout in Manama, the coastline of Benghazi, the streets of Sanaa and the streets of Daraa in Syria are far from the picture painted above. To a follower of western commentary over the years, you might think that the people on the streets are imposters as they do not fit the image created of a revolution not least in the Arab region. The events have challenged the way in which the West thinks of the Arab world and in a way the way in which the Arabs think of themselves haven endured a history of occupation from the Ottoman Empire to the European colonialists.

The revolution in which corrupt autocrats were toppled by a new generation of young idealists, inspired by democracy, united by Facebook and excited by the notion of opening up to a wider world has excited everyone and could potential usher change in which individuals have a say in how they are governed and who governs them. However, revolution demands not only the upending of the old order but the establishment of a new one. Removing a man is one thing; transforming a system is quite another.

Since the fall of Zain Al-Abidina ben Ali of Tunisia and Hosni Mubarak of Egypt, other regimes in the region facing existential threats to their hold on power have taken note of the mistakes of the two regimes such that in Bahrain, Libya and Syria, they have gone with maximum force to try and avoid the protest gathering momentum and potentially leading to the fall of the regime. Similarly, the regimes have taken to using the media to counter the messages being put forth by the protesters such as inviting journalists and taking them on a guided tour to granting interviews with their own side of the story ala Libya, or the exclusion of foreign media such as Syria. On twittersphere and blogosphere, they have become adept at giving counter messages of oppression and brutality to that of support for the regimes, highlighting restraint in the face of civil unrest and crippling of the economy. The joke going round on the internet was that Mubarak in a bid to stop the protest cut off the internet unbeknown to the regime that the fact that there was no internet made the youth restless at home who would have otherwise confined their protest to cyberspace to pour out into the streets thus giving momentum by adding a whole demography (i.e. young men and women) to the hard core protesters.

In my view and the little understanding I have of the region, what the citizens want is not only economic empowerment as highlighted by the efforts of the Saudi regime and other members of the Gulf Cooperation Council (GCC) to stave off protest and continue their stranglehold on power, but dignity. The ability to have a say in what goes on in their land, the treaties and agreement that their government gets into in their name, and above all what goes on with their Palestinian brothers in Gaza and the West Bank.

To the West (America, especially), the Arab world used to look up to it in the early 20th Century in their quest for independence from European colonialism in view of Wilson’s 14 Points speech to the US Congress in 1918, however the United States have not lived up to that ideal of progressivism, rather it has been treating the Middle East as its exclusive sphere of interest with oil being the main driving force of the relationship overshadowing the ideals of liberty and freedom – the ideals of which America was built upon. Therefore, its constant meddling in the affairs of sovereign nations in pursuit of its economic goals, propping up unsavoury regimes and the biased support for Israel are the key factors that have caused instability in the region. With its legitimacy at an all-time low in the Middle east and the rest of the world in general, it is best if America refrains from being actively involved in what is going on at the moment and allow the will of the people to prevail untainted and corrupted by outside influence since democracy is only accepted only in so far as it conforms to its strategic and economic objectives.

The current popular revolt is a wake up call to dictators and strongmen who put their faith in the hands of America. There is ample enough history to warn them that America is only a friend in as much as you remain useful to them. From Nicolae Ceausescu of Romania, Ferdinand Marcos of Philippines, Jean-Claude Duvalier of Haiti, Chun Doo-hwan of South Korea, Suharto of Indonesia and now Mubarak of Egypt.

In Egypt and Tunisia, the government that will be formed should represent the will of the people, be it secular, Islamist or an amalgam of both. The key to lasting peace and stability not only in the aforementioned states but in the entire Middle East and the Maghreb is allowing the people to choose the kind of government that they seem fit to best represent their aspirations, culture, and way of life.

Equity, justice and freedom are universal and that is what the masses of the Arab world are seeking. In this, I call on the world to help the Arabs achieve their aims but not at the expense of thousands of innocent lives.  

 


April 01, 2011

Nigerian Election: The World Awaits

As Nigeria, Africa’s most populous nation goes to the polls in a staggered three weeks election commencing with the legislative election on Saturday, followed by the Presidential election and the states election in the subsequent weekends, the world and Nigerians hold its breath and keeps its fingers crossed for a peaceful, free, fair, and credible elections in view of the recent polls held in the African continent and the revolutions sweeping the Middle-East and the Maghreb. The imperative for a credible election in Nigeria cannot be overemphasized, as 20 countries will hold national level elections in the African continent as such the conduct of a successful election in a diverse, multi-ethnic and populous country like Nigeria could serve as a template for the conduct of successful elections in the rest of the continent.

Since the inception of democracy in 1999, elections in Nigeria have been marred by irregularities in the form of voter intimidation, violence, outright rigging and in some cases non-conduction of elections. Voter apathy is rife, as elections got progressively worse from the 2003 elections culminating in the sham 2007 elections in which both local and international election observers concluded that it did not meet the basic standards of elections. The European Union Election Observation Mission in Nigeria 2007 stated in its report that, “the 2007 election process was not credible, and in view of the lack of transparency and evidence of fraud, there can be no confidence in the results.” President Umar Musa Yar’adua in his inaugural speech also attested to the fact that the elections that brought him in was flawed as he said “We acknowledge that our elections had some shortcomings. Thankfully, we have well-established legal avenues of redress, and I urge anyone aggrieved to pursue them. I also believe that our experiences represent an opportunity to learn from our mistakes. Accordingly, I will set up a panel to examine the entire electoral process with a view to ensuring that we raise the quality and standard of our general elections, and thereby deepen our democracy.” With such testimonies, it is no wonder that people have lost confidence and belief in the electoral process.

The appointment of Attahiru Jega as the head of the Independent National Electoral Commission (INEC) Nigeria’s electoral body has however restored a bit of confidence and belief to the electorate due to his integrity as well as the successful compilation of a new biometric electoral register that will be used in the forthcoming elections. Thus far, the level of preparedness as well as the pronouncements coming from the commission have been positive such that voter confidence that’s was at an all time low after the last elections is now coming back. The mood in the country is that of the desire for free, fair and credible elections. To this, the electorate have realized that it is up to them (taking the Tunisian and Egyptian popular uprising where people took charge of their destiny as a model) to make it possible by turning out en masse to vote and ensure that their vote count.  

With barely 24 hours to the opening of the polls, there have been mixed signals from the security agencies leading to so many uncertainties. The head of the electoral body has been consistent in saying that individuals have the right the stay after casting their votes and watch the counting, tallying, collation and reporting of results provided they stay peaceful. However, the police and the national security adviser have countered otherwise. The police even gave orders to the effect that mobile phones are not allowed in the vicinity of the polls. These conflicting signals have the potential to mar the elections and could be potential flashpoints as such the need for a clarification and harmonisation of views between the security agencies and the electoral commission to ensure a hitch free election.

It is time to test the widely held belief that African and indeed Nigerian politics is all about kinship, tribal affiliation, the prevalence of shadowy and influential people (god-fathers) and selfish politicians interested only in lining their own pockets and their family and associates or rather it is now about higher, positive and transformational ideals that aim to move the nation forward in the indices of human development. Both European Union and local electoral observers and monitors are on ground to bear witness to and give credence to the exercise.

Haven celebrated half a century of independence from British rule in October 2010 with most of that under military rule, as well as surviving a civil war, human rights abuse, and decades of mismanagement, the hope is that this election will be credible thereby helping to bring forth the first evolutionary leap and the entrenchment of democracy in Africa’s most populous nation. Nigeria is at a crossroad and the world waits with keen interest.



February 19, 2011

Libido Dominandi (The Lust for Power)

The lust for power, the zeal to be in charge, to dominate, control and above all to defeat an enemy is if not humanity's greatest problem, is certainly up there amongst the greatest. Since time in memorial, man (and the occasional woman) have used various pretexts to acquire power either for altruist or other reasons, however the manner in which the power is often acquired leaves a lot to be desired. Hierarchy and social order are intrinsic human traits that have been evident since the formation of society, however, the realisation and the manipulation of it is what has made the consequence of power often dangerous.  


Ambition and the will to lead is in no way a bad thing, people who are willing to put their neck on the line for the betterment of the society often make better leaders than thus who find themselves in position of authority by accident. Similarly, power is only given to those who dare and as the saying goes, "some are born great", thus they have been predestined to lead; "others acquire greatness" thus through share persistence, hard work, and dedication become leaders in their own field. With leadership often comes power, the question is how that power was achieved or acquired, and the challenge is how it is exercised.


Coming back to libido dominandi, it happens in every sphere of life in the world today but more especially in places where power is often absolute. The greater the sphere of influence, the more atrocities committed to acquire it and the greater the abuse in its exercise. As Henry Kissinger famously said Power is the ultimate aphrodisiac, it not only distorts the perception of people wielding it but it traps them in a bubble such that their world view is distorted, out of tune and often parochial.


According to Jacques Maritain, Authority and power are two different things: power is the force by means of which you can oblige others to obey you. Authority is the right to direct and command, to be listened to or obeyed by others. Authority requests power. Power without authority is tyranny. To this therefore, I urge leaders to be mindful about how they exercise power and it should be used to one end and one end alone - securing and improving the social welfare of the people.


November 28, 2010

Is Religion a Force for Good?

I was listening with interest the Monk debate between Tony Blair former British Prime Minister and a recent convert to Roman Catholicism and Christopher Hitchens author and renowned atheist on the motion "Be it resolved, religion is a force for good in the world". There is no better time to have such a debate than now, especially when religion of all denominations are under attack. The history of most religions are filled with violence and unmentioned horrors to people, but this is not only the preserve of religion or as always promulgated in the name of religion. Religion has been used unjustifiably stair up emotions which leads to hatred and eventual strife, but this could be attributed to any congregation of people be it secular or otherwise.


The thrust of this piece is not to exonerate religion or gloss over atrocities committed both in the name and by religious establishment themselves but to take objection to the way in which religion is vilified unjustly today. The rise of atheism and the advancement of science and technology has in many ways enhance the view that people's belief in a supreme being as well as reliance on dogma and archaic traditions with not so much good a history is unjustifiable, laughable and lamentable thus the promulgation of it being seen as not a force for good if not outrightly a force for evil.


The often quoted atrocities are the Crusades, Islamic Jihad and recently terrorism, however those postulating this conveniently forget that both the first and second world wars were secular wars fought for the control of land and resources. It could also be argued that often the wars coated in the name of religion are anything but, rather the institutions are used by those that want to perpetuate evil because of their large followings as well as absolute beliefs that people have in their faith. Therefore any critical observation of the role of religion will confirm that religion is hijacked by fringe elements to carry out atrocities similar to a way in which secular institutions could be used to perpetuate evil. Religious leaders often when they find themselves in a bit of tiff, use religion as a tool, analogous to when leaders find it difficult to govern at home, they venture out to shores-a-far to shore up their popularity rating.


Haven deconstructed the notion of the evilness of religion, now back to the question at hand, s religion a force for good? The answer is an affirmative yes with a capital "Y". Religion not only serves as a framework that governs peoples lives, it gives meaning, hope, and a sense of humanity. It champions love, extraordinary compassion, empathy, the pursuit of communal interest over self and above all gives hope and security. The teachings of forgiveness is sacrosanct in what religions across the board stand for. Religion is a force for good in that it inspires us to strive for and the pursuit of goodness.


August 27, 2010

Technology and Social Relations

The advancement of technology is always referred to as a good thing.... Well, "think again". A recent report by Ofcom (the independent regulator of UK communications companies) states that people in the UK (thus by extension developed countries) now spend over 7 hours of their waking time consuming media (tv, internet, mobile phone, ipods, etc) to the detriment of constructive inter-personal social relationships. That is half the average waking hours of adults.


The proliferation of technology has enabled people to be able to follow and know more and more about what every one does through social media such as facebook, twitter, linkedin and other social networking sites. Yet relationships are becoming less meaningful because they are only skin deep. Individuals have substituted challenges and face time in the real world to the virtual utopia of the online world in the hope that they can get away from their troubles. The relationships we forge are less meaningful not because of the technology but because we often exceed the critical mass of the bonds that the human mind can form. According to a research by Robin Dunbar popularised in the Malcolm Gladwell bestseller Tipping Point, the magic number is "150" people. We now have individual having over 300 friends on their social networking accounts as such the erosion of meaning in the relationships except for the select few.


Dont get me wrong, technology is a wonderful thing. On a personal note, it has kept me in constant contact with my loved ones (family and friends) and that special someone you can't go a day without, but is impact on the lives of many is reaching a point of diminishing return.


It is imperative that we take time away from the various gadgets and look at the person next to you and smile, or if you can a word because we might be making their day. It might help reduce the time we spend in our virtual cocoon and enrich our real world.


Technology therefore is not all rosy as it seems as a result of its conspicuous consumption, it enriches life when used in moderation and erodes social relationships when used in a gluttonous way.    


August 26, 2010

Level Playing Field

The advancement of mankind in a just and equitable way such that everyone has the ability to aspire to be anything irrespective of background, race, and creed is the ultimate goal of social justice. However, the term often used "level playing field" is a misnomer both in linguistic and social term. The linguistic analogy of the term to sports makes the outcome such that people are made to believe they have a fair chance of "winning" thus the social implications go far beyond the field of endeavour. 


The question we need to ask is, is the field ever level? It is indeed nobel that individuals are not denied opportunities based on economic status or qualification but the family being the first social unit that an individual encounters has a profound effect in shaping the individual. For instance, the ability to succeed in school and in social interactions is hugely influenced by parental background, social support and love. So the fallacy that "hard work" and "equal opportunity" creates a level playing filed is misinformed and thus misleading.


The discourse therefore should not be about giving people false hope but rather about helping people achieve their potential through uplifting people from poverty, eliminating barriers to social mobility and emphasising the need to have a fair wind on your side.   


August 25, 2010

Question Everything….

Hello everyone,

This is my first blog.... It will be a random collection of thoughts, information, and occasional outbursts. At times it will be thought provoking. To quote the Conservative MEP Daniel Hannan

When presented with a new discovery, we automatically try to press it into our existing belief-system; if it doesn't fit, we question the discovery before the belief-system.

I hope this blog makes people not only question discoveries as humans are prone to do but also have the courage to question their belief-systems when presented with new facts that do not conform to long held beliefs.




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