Beyond the Cusp

June 24, 2016

Venezuela is Just the Latest Example

 

Socialism is the greatest form of magic and it can work wonders under one small technicality; those in charge must be capable of predicting everything and every need weeks before they occur. There have been some great minds and some not so great minds which have attempted to master this simple little but key problem. They have never succeeded and likely until we have some extremely advanced artificial intelligence (AI) capable of figuring more computations and be inspired and intuitive as well, even AI will not save the day. Unfortunately for Venezuela they were relying on Hugo Chavez’s daughter and the rest of his crony socialists which has led to the riots in the streets because when the government gives everything and its fails, everything fails right along with it. The people are suffering as there is no food, no electricity, nothing, not even toilet paper. Venezuela is on the fast track to join that other socialist utopia, North Korea as that was the system they were emulating. What were they thinking? Anyone looking at North Korea and thinking, ‘hey, maybe we should try that total socialist thing and see how it works for us geniuses,’ is asking for ruin for their people. But what they saw in North Korea was the ruling elite who were living large and eating good and they looked no further than the feast served in the palatial grounds of the Kim family and thought, we can live large too. They didn’t look at the people who have been eating grass and the bark off of trees. North Koreans have it so good that they are trying to sneak into China where they see a world of plenty. Maybe China has found a secret to make socialism work as China is socialist, right?

 

So, since China might have found a secret, perhaps looking back at the socialist history and see what their magic bullet turned to be. Back when Mao Tse-tung initiated his socialist communist utopia of a planned production and state run farms and factories, they had such a failure that it is still unknown how many Chinese paid with their lives as a result of that first famine produced by crop and other farm failures. Estimates run from hundreds of thousands to tens of millions to hundreds of millions to unimaginable millions. The only Chinese who were safe from father Mao’s wonderful central planning were the peasants living in the furthest reaches of China in the remote farmlands who raised their own crops and were self-sufficient. Mao Tse-tung and his central planners then came up with a brilliant idea based on those remote peasants and allowed the farmers to work and plant as they saw fit and permitted them to keep sufficient food to feed their communities. But the factories still were under central planning because the communists understood the needs of the people. There were often shortages of particular items and sometimes unforeseen demands which were completely unexpected and there would be a lag time and waiting lists grew for such things as cars, televisions and other thought of luxury items. Housing became more sterile and stark as central planners placed a higher emphasis on quantity over quality and function and basics over appearance and luxury or even comfort. The people wanted more and knew about the rest of the world despite the attempt to control their news from the outside world. Mao Tse-tung gave in areas to the better minds but still retained much of the control centrally and thus restricting reactive production which led to continued waiting lists and production lagging demand sometimes by years. Mao died and the communists with time made a fateful decision as their economies could not meet their directive goals. They let loose of a degree of control and allowed for a select group of entrepreneurs, some free enterprise where industry owners were permitted to keep some of their profits providing they met the expectations and projections. This stimulated their economy and this led to meeting projections and industrial and economic growth beyond anything they had previously attempted. This led to economic growth rates sometimes surpassing 9% annual gains and brought the Chinese economy into the modern age and spawned the rise of a middle class, a new concept in socialist governance. But China was no longer a purely socialist system and it was the free enterprise which was permitted economic freedom which spawned the growth rates.

 

I can hear the questions asking what would happen if the growth rate slowed or even, heaven forbid, hit a recessive downturn. Well, that would be an easy one to answer with only one problem, the Chinese economy had been so repressive that the last decade plus, as they liberalized their economy and allowed more and more of the economy to be a semi-free demand economy with free enterprise, that they only recently finally reached a point where their gains slowed and failed to meet expectation and fell below their desired, if unreasonable, 9% per year and the initial signs are what some might call ominous. The central planners are showing signs of throwing out the baby with the bathwater as they are showing indications of returning to form and taking back the control over production planning thinking they can plan better than the profiteers as their decisions are empirical and not driven by guessing and risk taking. There is a positive side to this and that is we will see if after having witnessed the methods of for profit manufacturing and investment that the central planners might have an improved ability at decision making. Even if the central planning takes back sufficient control that the wait lists return and they end up where they were before their first experiment in free market economy, then their second experiment in free market economy will be the same inevitable success that they had the first time. The reason a free market economy works is that it is driven by greed, a vice which has never been vanquished from the human spirit and as long as there is greed, then profit based economy will work the best in satisfying the greed of the proletariat and the bourgeoisie as all gain from such a driven system. This could lead to a cyclical Chinese economy with it going in spits and starts as the free market produces growth until the inevitable recession. The central planners then clamp their control back over the economy and as that fails they resort to free market until it slows and back and forth and back and forth and eventually one will prevail. The likely winner, for the benefit of the Chinese people, will hopefully be free market and the central planners simply resort to governing wisely as we have always been taught the ancient Chinese rulers had managed when they were not fighting against one another in order to consolidate their control. The one thing that can be learned from the Chinese who found their way to allow for free market economy when central planning failed to meet the people’s demands is that even central planners can sometimes know when they have failed before it is too late.

 

Proletariat and the Bourgeoisie Lead to the Revolution

Proletariat and the Bourgeoisie
Lead to the Revolution

 

That is the problem with too many socialist governments, even those which are based on a free market economy but use socialist programs to redistribute wealth more evenly and to provide retirement income so nobody gets left out in the cold. When these programs reach a point where they outstrip the resources then either taxes need to be increased or other means of making the programs affordable even if they must cut back on their benefits. When the taxes are too high in order to presumably pay out welfare and retirement benefits the economy can still collapse into freefall such as was the case resulting from the 2008 economic downturn, bust if you insist, and Greece, Spain and others found themselves so deep in the hole that the economy was unable to recover. This was further exacerbated by the fact that they are on the Euro which receives much of its value based on the combined economies of the European Union which include Britain, Germany and other nations whose economic output is far greater than Greece thus Greece could also not support the value of the Euro which furthered their problem. The single currency may result in the end of the European Union if the nations being damaged by the single currency decide to leave so they can manage their own currency. Add into this the Brussels Eurocrats dictating immigration policies and forcing refugees into countries which feel threatened by the refugee situation. This will be a further demand on the economies of the nations taking in the refugees and you have another stress that will force more nations into economic difficulties. There is much to look at going forward and Europe is on the leading edge of the coming problems many which will result from the many and varied conflicts and other problems ongoing in the Middle East and North Africa, things we will most certainly cover here along with the other items of particular interest around the globe. In the meantime, let us hope that Venezuela figures out where they went wrong and change their economic means and systems to something which at least can feed and provide a few other necessities and even the luxury of toilet paper soon and the people can stop rioting and work and produce for their own enrichment and not just the enrichment of the central planners who apparently decided their wealth mattered more than the people and are now facing an ugly truth, they were wrong. We could hope for the people of North Korea as well, as their new leader, Kim Jung Un is apparently unbalanced and seems to believe if he is doing well the people should be happy enough by that knowledge even if they lack for virtually everything including decent food.

 

Beyond the Cusp

 

May 28, 2016

Brexit, Obama, Cameron and the EU Elites

 

What do Brexit’s opposition, President Obama, Prime Minister Cameron and the European Union Elite have in common along with the British Treasury, the International Monetary Fund, the Organization for Economic Cooperation and Development? They all are using hyperbolic, exaggerated paranoid economic forecasts of doom and gloom pitched with great arm waving and volume. Those supporting the British Isles leaving the European Union are equally voluminous and strident. There are entire lists of arguments favoring each side as well as dire predictions of horrific disasters with which to attack each side. So, where is the reality which a sane and measured approach of scientific study would support? The sad truth is that no such rational and unemotional report has actually been released and for good reason, leaving the European Union is a completely unprecedented occurrence. The best thing we can do in approaching Brexit is to simply add another opinion which in reality is not that different from every other opinion out there, the best we can reason out and then we will wait and see what happens should the vote go the way we would advise, but we so not expect to influence too many Brits as the other thing that has been polled is that the populace is divided mostly by age and everybody has chosen and are unlikely to compromise on their assumptions. The older generations, possibly because they remember the pre-European Union Britain, favor Brexit while those who have lived entirely as members of the European Union do not support rocking the boat. Perhaps it does break down to whether you lived in a period when Britain was not just another national entity lost within the folds and bureaucracy known as the European Union.

 

The one thing which the British have done which would facilitate their leaving the European Union much more easily than most other European Union nations is the British kept the Pound Sterling as well as accepted the Euro. This may prove to be one of the smartest decisions the British have ever made as eventually, whether it is next month or not all that far into the future of humankind when the European Union finally tears itself apart as the economic strains of retaining Greece, Italy, Spain, France, Poland and Germany as a single economic union while continuing to allow each of the aforementioned nations to rule themselves and make their own economic decisions within some unenforced presumed limitations which would have made minimal difference anyway. So, there will come a time when Britain will be leaving the European Union or the European Union will be leaving Britain along with every other member nation as it melts down from economic hemorrhage. The one thing which is easy to predict is what will happen if Brexit is voted down next month, nothing, absolutely nothing as the entire world will continue with possibly a slight amount of sighs in Brussels and a few perplexed looks from some of the financial wizards across Europe and in the United States as all their studies and predictions of the perils that Brexit will entail.

 

Pound Sterling

Pound Sterling

 

The question which needs examination is what will happen should Brexit pass. The only honest answer is that we have no idea, none at all. President Obama has predicted that should Brexit pass that Britain will lose out in every manner especially in trade with other nations. President Obama threatened that Brexit passing will necessarily place the British at the back of the line in trade with the United States. The President did not explain why this condition would come to pass; he just claimed that would be the result. Perhaps somebody should inform President Obama that first he cannot place anybody at the back of a line which does not exist and unless he was going to place trade sanctions on the British, there was nothing preventing their trade continuing with the United States without suffering any change as membership with the European Union has little effect on United States trade with Britain. The trade between the two nations would simply revert to the same manner as before Britain joined the European Union. Sure there would likely be some legislation passing through the Congress and being sent to the President reverting some of the trade regulations clarifying trade relations but even that would likely be more a reassurance than any drastic alteration such as what President Obama threatened. Even should President Obama veto such legislation, it could be readdressed come January 21 immediately after the new President is sworn in and it is doubtful that whomever should be in the White House would make any difference as such legislation is fairly innocuous and there would be little reason outside obstinacy for a veto.

 

That will not prevent us from offering our point of view. The immediate advantage the British would gain is they would no longer be constrained by the monetary policies of the European Union and the Euro. The British have had the advantage in setting some form of monetary policy free of European Union regulations as they did maintain their old currency, the Pound (we love the old term of Pound Sterling as it sounds so provincial and proud). The British also have their natural relations with the Anglosphere nations of New Zealand, Australia, Canada, United States and a few other more minor English speaking nations. Such a natural set of trading partners being made simpler by a common language grants Britain an easier transition should Brexit pass and they be free to trade under their own desires free of European Union constraints. Further, the British economy would no longer be having some of their resources diverted to support those nations which are in financial meltdown which is causing an ever more serious crisis one after another. Despite the economic restructuring and presumed limitations placed on spending pressed upon those nations suffering economic difficulties ranging from slow economic growth after the 2008 worldwide financial meltdown which began with market collapse in real estate and mortgage collapse due to lax lending standards which were dependent upon rising real estate prices to complete financial freefall such as the collapse in Greece, these nations often ignored these limitations regarding them as impinging on their national pride and being so draconian that they prevent their addressing the economic needs to climb out of their difficulties. Whatever the reasoning, the strain these failing economies place on the productive nations is slowly strangling their monetary gains, threatening to drag them down the same drain with the financially crippled nations. This could be the main reason for the appeal to many British and the reason that establishment supporters of the European Union desire to persuade the defeat of Brexit as they fear an even faster decline of the European Union should the British economy be removed from the sum total of the European Union economy.

 

What those who have as their desire the continued existence of the European Union fear most is Brexit passing as they are completely aware that Brexit would be the first and far from the last nation to exit the European Union. The reality is well known, once Britain leaves the European Union the writing is on the walls in Brussels, the end is nigh. How much longer would France or Germany remain should the British economy become positive and surging forward with a bright future becoming apparent? The answer is not long, weeks, months, but definitely not years. As the European Union is seen as the best stalwart against another ruinous European war and the only manner where the continent of Europe can fairly compete with the United States, China, Brazil, India and any other up and coming economic powers; the European Union core believers are of the mind that only as a unit does the European nations have any hope of competing with any form of equality with the far larger economies and simply larger nations which have the advantage that size brings. The European Union members see their union as the enabler of trade advantages and refuse to see that they are simply another layer of regulatory strangulation and further taxation depriving the nations and some companies from greater profits. They claim that without the European Union such companies as Airbus could never have been created and survived as it was the European Union which allowed the separate nations to work as if a single unit. The reality is that the nations would cooperate as doing so increases their financial strength and in this world of information technology the old differences and impediments which often strangled trade with tariffs and protectionism would not return as the new reality so obviously rewards cooperation between nations and so many of the corporations are now international in nature that nations no longer benefit from such measures. That is the reality and the British remember the freedom of pre-European Union Britain and with any luck, they will be able to reason and influence those without such experience and Brexit will pass and strike a mortal blow to the European Union.

 

Counter to what numerous economists claim, and luckily this is not a universal opinion, the European Union is not the answer to the problems faced by the troubled economies such as Greece, Italy and Spain but rather the result of the Economic Union and its common currency, the Euro. Whether Brexit passes inflicting a mortal wound to the European Union or if we need wait for the European Union to reach its inevitable implosion, the individual nations reverting to their natural independent currencies will initially cause some difficulties but will soon be able to alter their currencies in relation to one another and thus permit the struggling nations to have a devalued currency permitting them to have economic advantages of lower manufacturing costs and thus an economic advantage that accompanies such. That will bring a new vitality which is impossible when they must share an equal cost rate against Germany as the two nations are as different as night and day. Greece and the other struggling nations are closer to an agrarian or light industrial base while Germany is a heavily industrialized and entered the information age and has robotic manufacturing in many industries making a similar currency preposterous in the max. Brexit may just be the key to freeing Europe from Brussels and the self-appointed crowned aristocracy which has placed themselves over a continent for far too long and have reached well past the point where they have gone from a unifying and strengthening of the continent to a detractor which now regulates Europe slowly into a stagnation which was unavoidable as the simple fact that the European Union was an unelected oligarchy which thought itself above the people and not for or of the people and saw the people and individual governments and the nations as merely pawns in their social and economic games and misadventures. There may never be a study done which will find exactly when the European Union went from a path for greater economic growth and strength to a drag upon the continent and a guarantee of a slow but inevitable decline as the bureaucracy grew to the point that it became a ponderous beached whale no longer capable of reacting to financial needs and instead squelching any vibrancy making responding to changing economic forecasts next to impossible. The European Union has gone from a force for European economic cooperation to a farce siphoning off an ever increasing price dampening economic activity.

 

Beyond the Cusp

 

March 16, 2016

Should the Haredi be an Israeli Priesthood?

 

There are a number of schools of thought on whether or not the Haredi should be permitted to study Torah and allow that to be their contribution generally to Israeli society. Some are demanding that the Haredi face mandatory enlistment into the Israeli Defense Force (IDF) exactly the same as the rest of Jewish youths. Some are in favor of just young men while permitting the women not need to be enlisted with some claiming they be encouraged or made to serve in alternate public service. Then there are those who desire to allow the entirety of Haredi population simply lead pious lives dedicated to learning Torah with the referencing the numerous Haredi who spend as much as twelve hours every day except Sabbath either in services or learning Torah. Some less observant Israelis have pointed out the appearance of Haredi young men apparently strolling parks or in other non-study activities as proof that such a deferment for Torah study has been abused by some Haredi with which they broad brush the entirety of Haredi. There are few who desire to force the true and studious Torah scholars to not be permitted their honest scholarly pursuits as thus too is an important service whether all understand or even believe such dedication actually serve the State. Any serious answer to this situation, this challenge to the leadership of both the State of Israel and the Haredi society must find a reasonable and sensible solution which also takes into account some obvious demographic realities of the situation.

 

The one problem is that the Haredi community is a growing sector which would eventually reach a critical percentage where they would exceed the ability of the nation to support their complete absence from the societal productive engines. Simply stated, at some point in the not far distant future the Haredi community will be required to become productive if only to offset any costs their entire segment of society places on the State. The claim that the Haredi cover their own costs may be accurate to a point but at some point just producing sufficient food and clothing would exceed the potential of the state to produce and/or import even if the Haredi pay for their consumption as should they become over half, if not merely a lesser percentage, the production of the remainder of the population could not produce sufficient without employing the entirety of the remainder at a pace to support twice their population. At some point the Haredi will be made to make a judgement of which of their population show a particular promise or special talent lending them capable of receiving support to dedicate themselves to Torah study and such deferment should also be provided for any Israeli judged and desiring such dedication. There should be similar requirements as exist for professors at universities and colleges or teaching at Yeshivas. Also the Yeshivas should also be teaching at the least a basic education in addition to Torah study and perhaps a Torah curriculum for the public schools could be taught by religious scholars not just at Yeshivas. Such dispensations could and should be pursued with a plan to utilize those best suited in Torah scholarship to pursue such ends while it will soon be imperative for parts of the Haredi community to join the workforce and also serve in the IDF in special units which would allow for their observant lifestyle and restrictions not be challenged either intentionally, as has been the appearance in some instances, or through misunderstanding. These units will also likely require that a percentage, if not majority, of the officers and command chain be Haredi such that the sensitivities of these units will be better accommodated and understood by their commanders. If Israel is going to be serious about incorporating the Haredi into the society as a whole and especially into the IDF then some accommodations will be required and some give and take will be necessary on both sides. This will even include some arrangements with employers which will benefit all religious Jews and give some additional freedom to secular Jews and Israelis who are not particularly or even slightly Jewish. These accommodations will necessarily include scheduling such that the Sabbath is a say free of work with the obvious exception should rotation require a Haredi combat or mission necessary unit be scheduled for a rotation which counters Sabbath as defense of the nation is an exception recognized under Torah and universally.

 

 

Haredi Soldiers Taking Time for Morning Prayers in the Field During Training

Haredi Soldiers Taking Time
for Morning Prayers in the
Field During Training

 

The accommodations in the workplace would be no different than the accommodations granted Islamic religious members of the workplace who require prayer five times each day with the times set fairly rigidly. There should also be a liberalized attire universally applied for any group which had certain requirements for their appearance and attire. As stated, such accommodations should be universal and inclusive such that every group is comfortable and not unnecessarily required to break with traditional attire whenever possible. Needless to point out, should the required attire of a workplace stand counter to one’s religious requirements they should not seek employ in such locations such as nightclubs, clothing stores with secular progressive clothing requirements, and any place equally obvious which would be stated up front such that those who objected to the requirements would know not to seek employment in such places. There has to be certain rights both respecting the employer as well as the employees. An upscale and modern liberal clothing store would not be a place where Haredi or Islamic attire would be an accepted uniform, of sorts, attire which would necessarily show off such attire as part of being a salesperson. Some things should be obvious even to the most casual of observers, and the law should recognize the right of an employer to have appropriate attire and acceptance of the cliental and activities. A disco might not be an acceptable place for a strictly religious person of many faiths to choose work and such a place could have expectations which would exclude such employees in the first place. Such things should be obvious, period.

 

Military uniforms and other specific requirements for position are also understandable. An elite force which is designed to deploy places where the requirement might include wearing of a gas mask that people with full beards would have difficulties with such a mask and thus might not desire such an assignment or must be willing to remove their facial hair. As far as working in close proximity with women offending some stridently observant individuals, there should be accommodations and allowances whenever and wherever imaginable with a very liberal interpretation if such is possible. The scheduling women singing before a Haredi unit should never even cross the minds of commanders and if such were to be scheduled, then those wishing to excuse themselves should be granted alternate assignments and not just necessarily set free of any work related requirements. They might perhaps be assigned other duties such as cleaning communal areas or guard duty or other duty as seen fit in place of the setting they find objectionable. There is always something that requires doing in a military setting or they could be assigned policing the area of the performance after its completion. Such assignments would be at the discretion of the commanders of each unit.

 

The Haredi community should be granted generous liberties to define who amongst their community show and should be granted liberal special rights classifying them as a Torah sage or an astute and capable educator capable of inspiring students in the ways of Torah and the Written and Oral Laws. Whether or not a quota or percentile of the Haredi population will be permitted special observance privileges to spend their lives studying Torah or teaching Torah and the commandments and traditions in an inspiring fashion will largely depend on the responsible response and classification of their population between dedicated Torah scholars and teachers and those who will serve in the IDF or social services will, in the best possible of worlds, be left to the Haredi for as long as they perform these functions responsibly. Such a compromise needs to be reached such that both the Haredi and the general population are served through a mutual agreement and not through actual legislation, laws, court cases and general animosity. The reality is both the general Israeli public and especially the Haredi are majority Jewish populations and it would be nice to believe they could reach some accord which satisfies both communities. One can only hope that such an agreement is possible and can be attained with minimal if any acrimony as we are both majority Jewish, right?

 

Beyond the Cusp

 

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