Democratic deficits

Liberal democracy faces profound challenges. Radically different future trajectories present themselves. We are living through momentous times.

In Britain the media has spent the last fortnight preoccupied with the Hackgate scandal. Incremental, and ongoing, revelations have exposed the inner workings of the nexus between Westminster politicians and the tabloid media. What we witness is the political class showing an alarming level of deference to powerful economic interests. The alleged intimate connection between sections of the Metropolitan police and the tabloids raises equally urgent questions about the prevailing culture and ethics at the heart of a core social institution.

The British media has been preoccupied with this evolving soap opera involving many of its own. And the scandal has certainly opened up a welcome window of opportunity to reform relationships vital to a healthy democracy. But events unwinding elsewhere are likely to play a bigger role in shaping economic and political trajectories in the short and medium term. Read more of this post

Greece and the augurs of global disaster

Current events in Greece are genuinely transformational in more ways than one. Clearly the Greek economy is in a heck of a mess. It is not at all obvious whether either of the future directions on offer – eye-watering austerity, on the one hand, or default, exit from the euro and return to the drachma, on the other – offers the better economic route forward for Greece. But it is clear which direction European authorities see as better for the wider Eurozone.

Greek default would create turmoil and render the viability of the Spanish, Italian and Irish economies questionable as creditors sought to reassess and downgrade their holdings of sovereign debt. It would pose serious questions for banks across the Eurozone, in particular in France and Germany. While Greece accounts for a very small component of total Eurozone economic activity it is the symbolic significance of a default – and the profoundly negative chain of events that it could set off – that is feared. Read more of this post