A few economic-political predictions for 2009

A few economic-political predictions for 2009

- Property values all over Europe shall decline from 5% (Germany) to 20% (Greece).
- In the June euro-elections the eurosceptic parties shall double their power.
- The European Central Bank shall provide loan to the Greek government to avoid default of Greek government bonds. The loan could cost 20 billion euros to the european taxpayers.
- The value of the euro at the end of 2009 shall be around 1,10 $/€ (today it is 1,40 $/€).
-The world stockmarkets shall advance by 5% to 15%.
- Inflation shall be very low everywhere.

Emmanuel Stiakakis (www.kede.gr)

On September 15 the world day for democracy was celebrated. To claim democracy the citizens of any country should enjoy at least three fundamentally "necessary" (but not "sufficient") conditions:
1. They have to be able to set the laws of their choice through their representatives (parliamentarians) or through direct vote (referenda). In our country the members of parliament cannot vote laws of their choice since roughly 80% of our laws and regulations are sent from Brussels. As for direct voting (referenda) they are unthinkable. The citizens cannot ask for referenda and they are never called to vote in referenda.

The state performs its social work exclusively by means of taxation. In general, taxation is an act of taking away part of a citizen's liberty (it takes away the citizen's freedom as to how to dispose his/her personal property). However, liberty is by itself a "good" and in fact, it is the most valuable good. That means that under the present system, the state deprives citizens of one good (the freedom of disposing their own property as they see fit) in order to offer to other citizens (the weakest members of society) another good (usually a material good in some form of financial support).
At this political party, we believe in gradual but radical reductions of taxes (reduce the size of public sector, increase the size of private sector). At the same time, we believe that we ought to help the weakest members of society. This leads us to elevate voluntarism and charity to a very prominent form of social assistance. In other words, as the boundaries of the public sector shall recede, the boundaries of the voluntary and charity sectors shall have to advance.

Fanaticism and animosity towards other nations have no place in this political party. We view our fellow citizens as individuals, not as representatives of social groups ("the blacks", "the yellow", "the Muslims", "the Christians", "the atheists", "the poor", "the rich", "the men", "the women", "the gays", "the lesbians" etc). Disaggregating the citizens in subsets based on racial, ethnological, linguistic, or other characteristics is a residue of past collectivist-totalitarian mentality that does not see "individuals" or "personalities" but social subsets (minorities, classes, religious groups). Those social subsets ought always to follow the instructions-commands of the enlightened national leader or of the big brother-government-state.

The situation: Anyone can easily see that in Greece today there is total road traffic anarchy. People park their cars at any place they like, businesses and shops raise information signs anywhere and cars regularly violate traffic red lights. Speed limits are respected only by  foolish people and driving against one-way streets is quite common. Traffic signs are mostly vandalized and unreadable while young motorcycle drivers feel obligated to wakeup the neighborhoods at summer nights by removing the silencer from their exhaust and so on. The national and the municipal police are simply watching the situation, they pretend that they work, and at the end of each month they go and get their salaries amid their complains about the salary being inadequate.

The first principle for effective local governance is that every single administrative activity is exercised at the lowest possible level (subsidiarity principle). Example: Collection of garbage at municipal level instead of prefectural level.
The second principle for effective local governance is that there must not be responsibility for an activity without the corresponding management of resources for performing the activity. Example: If the citizens in a town wish to control the primary and/or the secondary education over their area, then the national government has to transfer to the town council the corresponding educational funds. The transfer from the national education budget has to be on a yearly basis, and in proportion to the registered permanent population of the town.
Third principle for effective local governance: The authority for an administrative activity should rest solely on one and only one layer of government. Example: If there is municipal police for overseeing vehicle parking, then the national traffic police should have no authority on vehicle parking over any area of the municipality.

What the local government ought to be (and what it ought not to be).
 
-First and foremost: The local government should be local! That means the population of the local unit (municipality or town) has to be sufficiently small so that it fosters a sense of community-nativity, which in turn creates the feeling of "belonging". In the absence of "belonging", there can be no real interest of the citizens for the place where they live.
-The municipality (or the town) is the elementary and most critical unit of government. The citizens in a municipality have to know each other (more or less), so that they are truly interested in the "common affairs", and so that they receive accurate and first hand information about "people and public events". Conclusion: The maximum population size of any municipality should be at most ten to twenty thousand people (10.000 to 20.000).

Our party is, by definition, for direct decision making, for transparency, for absolute freedom of speech and against bureaucracy. What is then our position on the subject of European Union (EU), an entity that, in the conscience of the simple people, has been identified as the exact opposite of all the above concepts (no to direct decision making, no to transparency, no to absolute freedom of speech and yes to unlimited bureaucracy)?

Lately, a great deal of discussion is taking place about the insurance and pension funds. The government strongly recommends merging of the various insurance/pension funds and creating one new fund for every four or five that exist today. It plans to start by unifying the insurance/pension funds of the engineers-architects, the lawyers-notaries, the doctors-pharmacists and the journalists. The previous government, as a solution to the pension funds problems, had itself designed the merging of the various funds in much larger entities. It appears that the parties of the political "establishment" are proposing, one way or another, the "unification" of public insurance/pension funds. Is the proposal the proper medicine for the ailing insurance/pension funds or it is the poison that will make sick even the healthy funds (by distributing equally the ailments to every organization)? If, on the other hand, the "unification" method is wrong, then why the parties of the "establishment" promote it? We shall examine briefly the main arguments for and against, using as criteria the common sense, the international experience, and the science of economics.

1. Rationale

The science of Economics as well as the international experience suggest the following:
1.1. The State (Central Government, Municipalities, Prefectures, and Public Organizations) and the International Organizations such as UN and EU, manage wealth that has been earned by "others" (taxpayers' money). Any person or legal entity, when managing money earned by others, cannot in general exercise efficient management.
1.2. The State sector employees work without the incentive of yearly detailed appraisals- promotion on the merits, and without the disincentive of lawful dismissal. Therefore, whatever they produce, they produce it inefficiently and bureaucratically.
1.3. The taxpayer, the producer of economic wealth, produces more (exerts more effort) the less the amount of his/her income to be taken by the state.
1.4. When the tax rates are lowered, then, the revenues of the Tax Authorities are permanently increased, at least over the long term (approximately after three years).           

A) Rationale: Material Progress and Lawlessness

The first prerequisite for material progress in any country is "Observance of the Law". This is what the science of Economics says but it is also what the study of  history shows. The laws in a country may be wise, the citizens may be hard working, but if the laws are not observed then there can be no rapid improvement in the living standards. Moreover, lawlessness creates a public feeling of insecurity and unfairness. The majority of people feel that they are treated unfairly when they see those "connected to the establishment" being subjected to preferential treatment or even escaping punishment (tax evasion, favoritism in public sector, illegal construction, legalizations, bureaucratic extortions, municipal permits for non-compliant activities, briberies, vandalism, road-traffic anarchy etc). Those phenomena create a country with low rates of economic growth, with a widespread feeling of "insecurity and unfairness" and, in the very end, a society of alienated and unhappy people. OUR COUNTRY TODAY IS EXACTLY SUCH A CLASSIC AND TYPICAL CASE. THUS, WE NEED TO ENFORCE THE LAW BEFORE CONSIDERING ANYTHING ELSE! BEFORE THINKING ABOUT ANY NEW LAW, WE NEED TO ENFORCE THE EXISTING LAW!

If we have some ideas about the economy or about politics and if we believe those to be worthy, why not we just put forth those ideas in newspapers, radio and tv stations? Why are we not setting up a club or a think-tank where all those ideas would be discussed and projected? Why do we need to go to the trouble to create from scratch a political party?

People use to say that a political party cannot survive unless it has the financial support of the state budget (as with all parties in our parliament today) or unless it has the financial backing of a very wealthy person or even the support of some secret or dark forces. We say no, we can do without all this. We simply have the support of our ideas. In the long term, ideas always win over money, over military power or over dark forces. 

Our reason for being is not to make the party members rich or famous. We do not intend to favor any population group or social group among our fellow citizens. We do not look to power as an end but as a means. We do not like the division of people into social classes or into any other artificially constructed groups. We do not want to see animosities between nations.