Politics

Les forces centralisantes et décentralisantes exercées sur les espaces économiques

Oct 30, 2017 Michael J. Boskin

STANFORD – Il y a plusieurs années, j’avais prédit que surviendrait un glissement tectonique vers la décentralisation, le séparatisme et l’indépendance à travers le monde, en raison de l’échec des institutions politiques dans la gestion des différences économiques, culturelles, ethniques et religieuses.

À l’époque déjà, les institutions économiques et politiques supranationales suscitaient clairement la révolte, concentrant l’essentiel du pouvoir au sein de gouvernements centraux. Les citoyens de nombreux pays commençaient à déplorer l’érosion de leur souveraineté, et à s’inquiéter des coûts trop élevés liés à une immigration croissante, compte tenu d’une lente reprise après la Grande Récession, d’une faible croissance de la productivité, et d’une diminution de la part du travail dans le revenu.

Depuis, le Royaume-Uni a décidé de sortir de l’Union européenne. Les négociations autour de ce divorce sont désormais en cours pour décider du montant que les Britanniques devront verser à l’UE, et déterminer ce à quoi ressembleront les relations commerciales futures entre les deux parties. Si cette procédure est difficile, c’est parce que les négociateurs de l’UE craignent de voir d’éventuelles modalités de sortie trop généreuses inciter d’autres États à suivre l’exemple du Royaume-Uni en quittant eux aussi le bloc.

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Michael J. Boskin

Writing for PS since 2009
91 Commentaries

Michael J. Boskin is Professor of Economics at Stanford University and Senior Fellow at the Hoover Institution. He was Chairman of George H.W. Bush’s Council of Economic Advisers from 1989 to 1993, and headed the so-called Boskin Commission, a congressional advisory body that highlighted errors in official US inflation estimates.

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Wim Roffel Nov 6, 2017

"The process has not been easy, because EU negotiators are worried that if the exit terms are too generous, other member states might follow the UK out of the bloc."
That is a very polite way to say that the EU negotiators are negotiating in bad faith - pressuring the UK with the threat of no deal and very high import tariffs if they don't obey. This is very similar to the bad faith negotiations with Greece where they wanted to set an example too.
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Steve Hurst Oct 30, 2017

If this, if that, if the other. Thats not reality

The one thing you never do with consumers is break the repeat buying habit. That is exactly what has happened. Now consumers question stuff they automatically swallowed before and say it doesn't do what it says on the label, pass me by, pass me by, I dont happen to like it, pass me by. They have reset their buying habit and now that habit has to be changed and there is no real reason for it to.
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David Punabantu Oct 30, 2017

Successionist movement are symptoms of economic and financial flaws. Take the US and UK. The UK under went Brexit the US got Trump. The underlying economic undertones are the IMF fixed cross rates that are anchored to the US dollar and Britian Sterling pound. The cross-rates appear day in and day out, in value terms, in many national currencies. This implies that national money markets have the same money market currency liquidity and trade volumes to produce the same cross rates as observed between Britain and the United State of America. On the February 16th 2017 the Indian Rupee traded at INR0.01495 per US$1, while the Sterling pound was at INR0.01199 per £1, giving a IMF cross rate of 1.24. The Japanese Yen on the same date stood at JPY¥0.008782 per US$1 and JPY¥0.007033 per £1 giving a cross rate of 1.24. The Canadian dollar also on the same day had CAD$0.76569 per US$1 and CAD$0.61420 per £1 to give 1.24 as it's IMF fixed cross rate. The Chinese Yuan against the US dollar stood at CNY¥0.145541 per US$1, and CNY¥0.116789 per £1, on the same day to give a IMF cross rate of 1.24. The Mexican Pesos, Brazilian Real, South African Rand, on the same day like all currencies across the world had 1.24 as the IMF cross rate fixed on the US dollar and Sterling pound.
The reality on the ground is that Zambia, Britain, Canada, India, Japan, China, Mexico nor the EU has the same level and volume of trade to give credibility to the IMF fixed cross-rates. In fact, the demand of the Euro or the Zambian Kwacha, Euro against the US dollar and the British Sterling pound and other African, Asian, Latin American currencies in relation to trade, within their money markets, gives exchange rates that are outside the IMF fixed cross-rate system. There is no competition here with IMF fixed cross rates. It must be noted that IMF MD Mr. M. Gutt at his Harvard University address on the 13th February 1948 noted that the indirect exchange rate of the US dollar to the Sterling pound was £1 per US$2.6 as US$1 equalled 600 Lire and £1 equalled 1,560 Lire, while the direct Sterling pound-US dollar rate stood at £1 per US$4. American found it cheaper buying British goods via Italy. The IMF ruled in favour of Britain as if Italy's money markets had the same inflows as London's money market.
It is here that the real price of the US dollar in value terms is fixed. This has created in value terms a black market of value undermining national economic systems which in turn has undermined political systems. Take China with its mountain of US dollars. China's US dollars have been dished out as loans to other countries on generous terms and conditions as compared to the US dollar from the US. In effect the Chinese dollar in value terms is cheaper than the US dollar. Hence a black market US dollar has evolved. It is these black market values that has encouraged successionist movements. The reality is successionist movements are movement in the political realm but all echo the need of global economic reform. What is needed is the true value of the US dollar within and between markets should reflect trade positions. In other words the notion of one fixed value of the US dollar is more political , much like a decree, rather than the economic and financial realities on the ground. The reality of successionist is economic and financial succession being Free Floating Cross Rates and allowing all currencies to be convertible but the price of the currency between markets determine the degree of convertibility. The picture that emerges, in a free floating cross rate system for example, may see Country Z having trade surplus with Country J as it uses Yen to convert into Country Z’s currency the Kwachas to buy copper. This creates an exchange rate of ¥1,000 per K1 as Country J uses her Yen to purchase Kwachas, Country Z’s national currency. Country Z buys very little from Country J in relation to what Country Z exports to Country J. To this, Country J uses the purchased Country Z’s Kwachas to buy copper, against which Country Z accumulates Yen in its market as the Fund as noted in Article I of the Fund Agreement is, “to assist in the establishment of a [multilateral] system of payments in respect of current transactions between nations.” Although the exchange rate in Country Z for the US dollar, based on Country Z’s market liquidity may be K8 per US dollar, in Country J it may well be ¥200 per US dollar as Country J trades more with the United States than Country Z.
If a citizen in Country Z wanted to import an iphone from the United States pegged at US$500, it would be cheaper to buy the iphone via Country J, but this would in turn affect market liquidities in both Country Z and Country J money markets and hence exchange rates as exchange arbitrage operations occur. The US$500 iphone in Country Z in Kwacha terms based on its K8 per US dollar rate would cost K4,000, but through Country J the cost of the iphone would be ¥100,000 at ¥200 per US dollar, being through Country Z’s Kwacha/Yen exchange rate at ¥1,000 per K1 be worth K100, which is equal in US dollars based on Country Z’s US dollar/Kwacha exchange rate at US$12.50. At US$12.50 per iphone the United States would be on an equal footing to deal with another country called China with its cheap exports unless China’s cross-rates are lower in the countries China/United States/Country Z’s exchange rate configurations.
It would then be a question of quality and finding the best value in currency arbitrage operations.
The United States would still get its US$500 disregardless of the value step up or step down and the problem of external disequilibrium is addressed provided each country settled its exports in its national currencies. This follows the basic underlying tenets of Adam Smith's supply and demand doctrine. Economics 101 teaches us that Adam Smith's market doctrine is based on supply and demand. The underlying axiom is country X produces good X and is bought by currency X belonging to country X. If country Y wanted good X it has to change its currency Y into currency X to buy good X. That is why a Euro cannot directly buy goods from the US until it is changed into a US dollar hence Exchange Rate. But for Africa, Latin America, Asia that is not the case as seen in the London Metal Exchange. Africa's, Latin America's, Asia's mineral wealth on the LME that handles most of the world's non ferrous metals only allows the US dollar, the Sterling pound, the Japanese Yen, the Euro to buy Africa's, Latin America's, Asia's mineral wealth adding that wealth to the US dollar and the LME accepted Currencies. In 2015 the Chinese reminibi was added to the list while African, Latin America, and Asian currencies minus China and Japan are banned in this so called age of free markets and trade liberalisation. Trade liberalisation and free markets for whom? Do such policies follow the tenets of the market doctrine or corrupt it? It adds Africa's, Latin America's, and Asia's wealth in value terms to the US dollar.
Free trade, liberalisation go hand in hand with democracy. But under the current global economic structure of one fixed value system democracy becomes mobracacy that degenerates into tribalism, xenophobia, alt-right, corruption, that all distort and undermine human trust in systems to encourage successionist movements.
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