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An Inventor of Russian Democracy
By MASHA GESSEN –  March 26, 2012, 8:38 am
Masha Gessen is a journalist in Moscow. She is the author of “The Man Without a Face,” a biography of Vladimir Putin.

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MOSCOW — I wanted to write her story for a long time. To be precise, I wanted to write this story: She was Vladimir Putin’s oldest enemy, and she lived to see his demise.

She did not.

I first met Marina Salye more than 20 years ago, in what was then Leningrad. The Soviet system was crumbling, and this gruff, short, heavy-set woman was one of the key people taking it apart. She was Leningrad’s most popular politician and a member of its new city council, one of the first popularly elected government bodies in this part of the world. She was one of the inventors of Russian democracy.

A geologist who had spent much of her life in far-flung expeditions, away from the ideological center, she was elected to office in 1990, at a most promising and most frightening moment. Food shortages had been endemic for decades, and the country was now on the verge of full-fledged catastrophe. In the hopes of staving off famine, the federal government decided to allow regional authorities to use strategic supplies of oil, gas, timber, rare metals and other natural resources to barter for food imports.

Famine was ultimately averted, but in Leningrad — or St. Petersburg, as the city was called starting in late 1991 — food imports never materialized. In 1992, the city council formed a committee to investigate what had happened. The committee, which was co-chaired by Salye and the city councilor Yuri Gladkov, concluded that the city had lost as much as $100 million and named a deputy mayor called Vladimir Putin as the probable culprit. It recommended that Putin be dismissed and prosecuted. The mayor dismissed the city council instead.

Salye became a professional organizer and eventually moved to Moscow. In the winter of 1999-2000, when Vladimir Putin emerged as the frontrunner in the race for president, she tried to campaign against him. She also tried, unsuccessfully, to draw attention to her long-ago investigation. A week before the election, she published online a prescient article warning that Putin would be “the president of a corrupt oligarchy.” Still, 12 years ago today, Putin was elected president.

A few months later, Salye disappeared from view. She later said that she had gone to see a political ally and encountered someone in his office whom she “never wanted to see under any circumstances.” She found the encounter frightening, she told me some years later, and as soon as she came home, she told her partner they would be leaving Moscow. They moved to a semi-abandoned village in the woods not far from the Russian-Latvian border, where Salye’s family had owned a house for some time. The man Salye had gone to visit, the opposition politician Sergei Yushenkov, was gunned down in Moscow in 2003.

I started looking for Salye about four years ago. Rumor had it she had long left the country, but it didn’t take me long to find out she was in Russia. At first she didn’t want to talk. Over the following two years I continued bothering people I thought might be in contact with her. Finally I was given a direct phone number and Salye invited me to visit her.

One day in 2010, a colleague and I were in Salye’s pink wooden house. Salye’s companion, whom she called her sister, fetched box after box of documents. Salye kept talking about rampant corruption in the St. Petersburg administration in the early 1990s, when Putin was the mayor’s right hand. I had seen some of the documents before; others were new to me. In any case, Salye was the only person who could guide me through them now: Gladkov, the co-chair of her investigation, had died in 2007 of a rapidly progressing degenerative neurological disorder. Salye and others claimed it resembled a chemical poisoning.

Salye started writing a blog. Even while living in the woods, she maintained a remarkably keen sense of Russian politics. Throughout 2011, she spoke out ever more forcefully in anticipation of last December’s parliamentary election. After the protest movement that shook Russia in the winter, she came out of hiding. On Feb. 4, she appeared in front of tens of thousands of protesters in St. Petersburg, just as she had done more than 20 years earlier.

Her partner objected, fearing for Salye’s life, but Salye seemed unstoppable again. She started campaigning vigorously on behalf of the billionaire Mikhail Prokhorov and, as was her custom, against Putin. She claimed to have evidence of previously undisclosed violations on Putin’s part and vowed to pursue an investigation.

I thought it would make a beautiful story someday soon: Woman comes out of hiding to bring down repressive Russian regime again. I think I forgot she was 77 years old.

Marina Salye died of a massive heart attack on March 21.

Source.

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As Displaced Return to Iraq, New Tensions for Neighbors

By JACK HEALY and YASIR GHAZI

Published: March 24, 2012

BAGHDAD — Even after death squads began killing his neighbors, after corpses appeared in the streets around his home and his family fled in fear, Walid al-Bahadli still believed in his once affluent and diverse neighborhood of Al Adel.

A Shiite Muslim, he had grown up there during the 1960s, when Sunnis and Shiites lived side by side in palm-shaded mansions. He vowed after he and his family moved away to safety that the family would return.

But as the Bahadlis have discovered, along with hundreds of thousands of Iraqis now seeking to go back to areas they fled during the bad times, going home again is never as simple as it seems. Instead, they find themselves perched along the next front in Iraq’s seemingly unending turmoil: the battle of return.

Across the country, near-record numbers of displaced families are pouring back, but instead of kindling a much-needed reconciliation they are in some cases reviving the resentments and suspicions created by bloody purges that carved Iraq into archipelagos of Sunnis, Shiites and Kurds after the American-led 2003 invasion.

In places like Al Adel, some Shiite families view the Sunni families who stayed behind as complicit partners of the violent Sunni militants who overran many mixed neighborhoods. But many Sunni families say they now feel like they are being hounded by returning Shiites who, for the first time in centuries, have the force of the government and army at their backs.

In 2011, the number of returnees to Iraq soared by 120 percent from a year earlier, to 260,690, according to the United Nations High Commissioner for Refugees. They were drawn back by improving security and larger government payments to Iraqis registering as returnees. It was the most since 2004, when the fall of Saddam Hussein opened the gates for thousands who had fled his brutality, forced relocations and a decade of crushing sanctions.

As they continue to come home, they will test whether Iraq can move beyond a sectarian prism that distorts its politics and undercuts its security. It is a struggle that will play out in future years not just in politics and government, but in scarred, segregated neighborhoods like Al Adel.

And if the story of the Bahadli family and their neighborhood is any guide, it will be a return layered with friendship and forgiveness, but also distrust. And one stained with blood.

In Arabic, Al Adel means justice. After the 2003 invasion, it became a base camp for Sunni insurgents in western Baghdad. They carried out torture in seized houses and battled Shiite militias who had control of a nearby neighborhood. Nearly every Shiite family moved away, and residents estimated that 300 people were killed in a neighborhood of about 1,500 to 2,000 families.

Today, Al Adel blooms with loud markers of the Shiites’ return and ascent. Along the main streets fly black, green and red flags of Shiite mourning and martyrdom. The faces of Shiite clerics, living and dead, stare down from billboards. A new mosque for followers of the radical Shiite cleric Moktada al-Sadr has opened.

For Shiite Muslims who have returned over the past few years, these are footholds of identity. But Sunnis say they get the message: it is religious Shiites who now hold sway from Al Adel to the office of Prime Minister Nuri Kamal al-Maliki. “They see us as a threat,” said Mohammed al-Ani, 35, a Sunni government worker. “They are putting us through the same things that the Shiites suffered. Now, as a Sunni, I am afraid when I am home. I keep thinking that they will come and arrest me.”

They grumble about being harassed at the two checkpoints leading into the neighborhood, and they say that the soldiers who wave Shiite residents through demand identification of the Sunnis. Every few weeks, Sunni residents say, their houses are raided by soldiers loyal to Mr. Maliki.

“For nothing,” said one resident who asked to be identified by the nickname Abu Sama, a Sunni who has lived in Al Adel since the late 1960s and whose house has been raided several times.

Abu Sama lives next door to an old Shiite friend. They call each other brothers. But in private, Abu Sama seethes with a bitter sense of disenfranchisement that now sears the Sunni heartlands of Iraq, from the river valleys of Diyala to the deserts of western Anbar to the irrigated central plains of Salahuddin. He sees conspiracies against the neighborhood’s Sunnis in the home searches and the periodic arrests of scores of Sunnis over the latest terrorism plots. “I am a stranger in my neighborhood,” he said.

But the suspicions have two sides.

Inside Al Rabia market, shoppers from all sects and political backgrounds jostle for the same honeyed sesame candies, dried dates and plates of roasted lamb. The market’s Shiite owner, Saad Hamid Majid, has deep ties to both the Sunni and Shiite communities in Al Adel. But he admits he is still wary of his neighbors who stayed behind when he and other Shiite families fled.

Many Sunni families watched over houses vacated by their Shiite neighbors, but Mr. Majid believes others invited squatters and became the eyes of Sunni militants, passing along information about their Shiite neighbors.

“We told the Sunnis that we are brothers and can live together,” he said. “But they are not happy we’re coming back. You can see that in their eyes.”

In 2008, after three years of displacement, Mr. Bahadli and his family moved home. Their house was a wreck, but an ebb in the violence gave them space to rebuild. The family bought new couches and furniture for the parlor, and new birds to sing in backyard cages.

Mr. Bahadli took on a role as the neighborhood’s mayor, his family said. He wrangled garbage collectors. He paid grocery bills for widows. He mediated countless arguments while sipping glasses of syrupy black tea. The family reopened their ice cream shop.

“We were cautious at first,” said Mr. Bahadli’s brother Riyadh. “We took measures to protect ourselves. We all went out together. But day after day, we started to feel safe.”

More than anyone else, Mr. Bahadli felt as if he had reclaimed Al Adel, his family said. “He felt like the neighborhood was guarding him,” his brother Alaa said. “Like it all loved him.”

But on Jan. 17, Mr. Bahadli was coming home from the ice cream shop with his daughter and 2-year-old grandson when two men confronted them at their front gates. They drew their guns and fired. Mr. Bahadli and his grandson were both killed. His daughter survived, wounded by a bullet that passed through her hand and struck her son’s skull. Two Sunni men from the neighborhood were arrested in the shooting, but the Iraqi police would not identify them or make them available for an interview. Mr. Bahadli’s family members said they believed he was killed because he was one of Al Adel’s most prominent Shiites. “Killing him was a big achievement,” said his brother Riyadh.

A few days after his funeral, a crowd of Sunni and Shiite residents, tribal sheiks and neighborhood leaders gathered at the family’s door and urged them not to leave. They promised to look out for the family.

The family stayed, but they now live in terror. Mr. Bahadli’s mother weeps and implores her other sons to move away again. Recently, a car circled the block two times and the family suspected it was the prelude to another attack.

And a pall has fallen over much of Al Adel. Friendly Sunni residents mourn Mr. Bahadli’s death while worrying it will bring reprisals on their heads. And some Shiites, like Mithaq Sadia, a young mother, have steeled themselves for another sectarian conflict.

“This time,” she said, “we will make them feel fear.”

Source.

What happened in Slovakia sounds like a scenario of a political movie: a private investment company, a bench of political leaders, a backdrop of national elections opposing the outgoing right wing party and the leftist populist candidate, and a secret file released on the Internet.

To me the most hurting is that the corruption operation took place during the integration of Slovakia into the EU. What was supposed to be a democratization and modernization process was completely diverted to serve the interest of the dominants. Open your eyes people, “Europeanization” is not what we have been told… Free market economy, democracy, human-oriented values, transparency and accountability, consumer protection… Where are all these things and how can we trust European institutions? And above all, how can we trust the political class?… Well to that second question, Slovaks already answered with indifference. No one is really surprised by the scandal, but still the governing party stepped down.    

So what are exactly the Gorilla file and the Penta affair?

 

The Gorilla file: Slovak election overshadowed by huge corruption, protesters toss bananas

For two years, the dossier claims, politicians of all stripes were pocketing kickbacks from members of an influential private investment group. In the wall of the apartment where the clandestine meetings took place was a listening device planted by a secret agent intrigued by why so many high-level visitors were dropping in.

The “Gorilla” files — mysteriously posted online by an anonymous source in December and said to be based on the wiretaps — have rocked the already-raucous world of Slovak politics ahead of elections Saturday. The fallout looks certain to propel populist former leader Robert Fico back into power, even though he himself has been implicated.

The file purportedly documents shady dealings between 2005 and 2006, and suggests investment group Penta bribed government and opposition politicians to win lucrative privatization deals. Politicians from almost all major parties have been tainted in the scandal, named after a beefy Penta guard whose apartment provided the venue for the meetings.

Prime Minister Iveta Radicova’s Slovak Democratic and Christian Union, whose free-market reforms earned the country NATO and EU membership, looks likely to be hit hardest. The party was in power in 2005-2006 and then-prime minister Mikulas Dzurinda is now foreign minister and party chairman.

Polls indicate the party will win only about 5 percent, despite overseeing an economic boom driven by solid growth, strong exports and the implementation of much-needed pension reforms. The early elections were called when the government fell after failing to approve Slovakia’s contribution to an EU bailout fund.

The left-wing Fico, who ruled from 2006 to 2010, says he is innocent and doesn’t recall the meetings he was said to have attended, adding that he couldn’t have influenced any decisions because he was in opposition.

One big winner in the scandal? Fruit vendors. Angry protesters, some in gorilla masks, have taken to the streets in numbers not seen since the final days of Communism to pelt Parliament and government offices with showers of bananas. In Prague, the capital of the neighboring Czech Republic, large painted gorilla footprints have been splashed along the streets leading up to Penta’s offices.

“You can’t really call it a proper election campaign — no programs or goals of political parties have been discussed,” said analyst Miroslav Kusy. “It’s all about these negative issues.” He said Slovaks — for whom “all politicians are just thieves” — could turn out in record low numbers of just 40 percent in a sign of their anger.

The spy agency — SIS — has refused to confirm the file’s authenticity. SIS heads are suspected of sweeping the wiretap findings under the carpet; police are now investigating following the anonymous leak.

Penta has vowed to clear its name.

The group’s Bratislava spokesman, Martin Danko, says the scandal has “undoubtedly negatively hit our reputation in Slovakia” but claims business has not been affected. In Slovakia, the group owns a health insurance company and two banks and has invested heavily in privatized firms.

The file claims that one former economy minister received the equivalent of $13 million for his assistance and that the head of the National Property Fund took in about $9 million. As with all figures caught up in the scandal, they deny wrongdoing…

Source.

 

What is Penta?:

Penta’s initial capital originates from the business that the two founding members, Marek Dospiva and Jaroslav Haščák, conducted in China. In the early 1990s, during their studies in Beijing, they began importing Chinese textiles to chain stores in Czechoslovakia.

Back in Bratislava, Haščák and Dospiva teamed up with their future partner, Jozef Oravkin, and began trading on the newly expanded stock exchange. At the end of 1993, they founded Penta Brokers and acquired two new partners – Martin Kúšik and Juraj Herko. All of the Penta partners had been schoolmates during their studies in Moscow and Czechoslovakia. The business name, Penta, is a tribute to the five original partners who founded the company.

In 1999, Penta was restructured into a holding with its mother company in Cyprus.

In 2005, Penta was changed its structure to that of a standard private equity company. In 2005, Penta decided to diversify its portfolio. Apart from its buyout business, Penta decided to invest in real estate.

Read more: http://www.pentainvestments.com/about-us/profile/penta-story

Thomas Nicholson: Why Slovakia’s corruption scandal is good for democracy

14 March 2012. He is the man who shook Slovakia. For years, Thomas Nicholson, a Canadian investigative journalist living in Slovakia, tried to publish the “Gorilla” file about corrupted politics in the country. No one would pay attention to it, until the beginning of this year when the documents he had received from a secret service agent surfaced on the Internet. The file had a major impact on the March 10 general elections. “Politicians will have more and more difficulties to continue practice corruption”, says Nicholson, when we met in a Bratislava café on the wake on the election.

Some people say that “Gorilla” pushed more people into social-democratic leader Robert Fico’s arms. What’s your opinion on Fico coming back to power?

I am surprised by how little effect the Gorilla file has had on these elections. The expectation was lower ballot participation because people would lose faith in democracy; the right wing would be absolutely destroyed, because this corruption scandal primarily affects them. They were in power when it happened, but in fact we have had the highest turnout since 2002 (60%). The right was punished but they got a second chance.

There are many positive things about these elections. First of all, the Nationalists did not get back into Parliament. And finally we have Fico as a single party government that will have no excuses, no Nationalists or Populists to blame for corruption or for his failure. It’s a good recipe for a better government than the last time he was in power [2006-2010].

I think all in all, these elections, even though they were bad news for the Right, are about as good as what we could have hoped for. People were tired of instability, stupid arguing and inability to make compromises. Gorilla has not much to do with it in the end. People were tired of instability. Fico himself is not an angel but compared to the right wing he represents stability and that was what people were looking for.

Fico is apparently mentioned in the Gorilla document. Do you think the investigations will continue during the second Fico government?

Fico is not directly threatened by Gorilla, but his party is. Obviously his secretary was in the incriminated flat [in which politicians were meeting members of the Penta financial group and which was wire-tapped by the secret service. The transcripts form the material of the Gorilla file], he accepted money from the Penta financial group to finance his party Smer. Whether he will support or not the investigation, that is very difficult to say. There is lot of public anger about this file, and this anger goes all across the political spectrum. If he wanted to gain political points he would appear to support the investigation. But we know how politics works. He can easily stop it. This file was buried in 2006 by Josef Magala, the head of the Slovak secret service SIS, when police got it under Fico they absolutely failed. So he is not probably going to be enthusiastic about the investigation.

Do you believe that thanks to the revelation of such a scandal Slovakia will become a more democratic country?

I do. It might sound naive, but I have concrete reasons to think that. I don’t think it’s possible anymore for any financial group to do business with the government or politicians, in the future these connections will be very politically fraught with danger for any politicians to have.

As a result of this Gorilla investigation there will be a lot of initiatives that have started focusing on transparency and clarity in politics. I am a good example. I will probably leave journalism to set up a website which will be a database of connections between politics, financial groups and organised crime. It will be publicly available to voters, especially when the next election comes around. All kinds of these initiatives will come up in next four years.

The public has been empowered by knowing how corruption works, it’s a knowledge about oligarchy, politicians, political nominees, how they work. Important is that people know about these connections. You have no governmental groups providing this kind of information. All that changes the environment that we had before. Politicians will have more and more difficulties to continue to practice corruption.

Your book about Gorilla has been banned by a tribunal in Bratislava. But you’ve started publishing some fragments of it anyway in the newspapers. The Penta group, which is considered as a financial shark swimming in the Central European waters, has pressed charges against you. Do you think you can win against them?

The suit against me is 500 pages long. But at the same time they have no foundation to stand on. These people, when they can’t buy someone or scare someone, they run out of ideas because they don’t know anything else. Besides the individual discomfort of being threatened by these people, I don’t need money, I don’t need fame, anything really. And I don’t have anything to lose. As Janis Joplin said a long time ago: freedom’s just another word for nothing left to lose. I don’t really care about their lawsuit. I have the publishing house Petit Press, who represent me. Whether the court will be for me or against me doesn’t make much difference, because Penta lost in the Court of public opinion and I don’t think anybody is afraid of them anymore. So whatever they win in terms of financial squeeze of my double-mortgage house, they are welcomed to it.

Source. 

Crippled by debt, propped up by European powers, handicapped by an ineffective administration: uncompromising diagnoses of Greece’s ills are not new. The text that follows, drafted by 19th century French writer Edmond About, has re-emerged in the European press.
Edmond About

Greece is the only known example of a country that has lived in bankruptcy since the day that it was born. If such a situation were to prevail in France or England for just one year, we would see terrible catastrophes. Greece has peaceably lived with bankruptcy for more than 20 years. All of the country’s budgets, from the very first to the one just out, have been in deficit.

In civilised countries, when the sum of revenues is not sufficient to cover the budget for expenditure, the difference is made up by an internal loan. However, the Greek government has never tried to obtain such a loan and any attempt to do so would have been in vain.

The powers that protect Greece have been obliged to guarantee the solvency of the Greek state so that it can negotiate with external lenders. But the loans thereby obtained have been squandered by the government without any benefit to the country: and now that this money has been spent, the guarantors have no other option but to have the good grace to pay the interest, which Greece cannot reimburse.

Wealthy property owners succeed in frustrating the state

Today, the country has given up all hope of paying off its debts. And if the three powers continue to pay indefinitely in its stead, Greece will not be much better off because its outgoings will always be greater than its income.

Greece is the only civilised state where income tax is paid in kind. Money is so rare in the countryside that there was no option but to adopt this method of collection. The government initially appointed tax collectors who courageously set about their task, but thereafter failed to fulfill their obligations to the state, which was powerless to constrain them. Now that the state itself has taken charge of the collection of tax, the costs have proved considerably greater while the income obtained has barely increased.

The taxpayers have followed the example of the tax collectors: they do not pay. Wealthy property owners, who wield significant influence, succeed in frustrating the state by bribing or intimidating its agents. The agents, who are poorly paid and may be dismissed at every change of minister, do not defend the interests of the state as they do in our country.

Their sole aim is to cultivate the rich and powerful and to line their pockets in the process. As for the small property owners, who are called on to pay for their wealthy neighbours, when they are not protected by their own poverty, they have powerful friends to ensure that their goods may not be seized.

In Greece, the law is not the intractable entity that we know. Tax collectors are careful to listen to the taxpayers, sure in the knowledge that when formality has been swept aside by brotherly feeling, it will be easy to reach agreement. The Greeks know each other very well and like each other a little. But they have virtually no acquaintance with the abstract being we call a state, which they do not like at all. Finally, tax collectors are prudent: they know they should avoid exasperating their countrymen, that there are bad stretches on the road home and that accidents can happen.

Loans are only granted to governments believed honest enough

Nomadic taxpayers (shepherds, woodcutters, coalmen and fishermen) have made it a point of honnor to avoid paying any tax. They believe, as they did in the time of the Turks, that their masters are their enemies and that a man’s most noble right is the right to hold on to his money. It is for this reason that until 1846, Greek ministers of finance produced two revenue budgets. One, the current fiscal year budget, indicated the sums the government ought to receive; the other, the administrative budget, indicated what it hoped to receive.

And as finance ministers are more prone to errors in favour of the state when calculating probable resources, they also had to produce a third budget detailing the sums that the government was sure to collect. For example, in 1845 for the produce of olive trees on public land, which is regularly collected from private taxpayers, the minister noted the sum of 441,800 drachma in the budget for the current fiscal year. He was hoping (that is to say in the administrative budget) that the state would in fact receive 61,500 drachma.

However, this hope was in itself presumptuous because in the preceding year, the revenue to the state generated by this item did not amount to 441,800 drachma, or even 61,500 drachma, but only 4,457 drachma and 31 lepta, that is to say approximately one percent of the amount due to the state. In 1846, the minister of finance decided not to draft an administrative budget and the custom fell into disuse.

Greece’s outgoings are as follows: the servicing of public debt (both internal and external), the civil list, funding for parliament and government ministries, collection and administration costs, and miscellaneous costs.

If I had to advise a government that had doubts about its own strength, its credit, the affection of its supporters and the prosperity of the country, I would say: “By all means take out a loan.”

Loans are only granted to governments that are well established. Loans are only granted to governments that are believed to honest enough to honour their commitments, and loans are only granted to governments that lenders want to maintain in office. Nowhere in the world does the opposition lend to the government. Finally, lenders can only grant loans when they have the necessary funds themselves.

A state ever absent
Well over a hundred and fifty years later, Die Zeit repeats the truths written by the French visitor to Greece Edmond About, who described the lack of communication in the Greek government and the abnormal number of employees in an obsolete state.

The Brussels authorities will do everything they can to save Greece, assures Die Zeit, but these reforms will be futile and ineffective, as Greece has not built a truly modern state structure.
The concept of “state-building” is familiar primarily in regions devastated by war. Now, though, the concept applies to a country inside the European Union. For the state that the Union wants to shield from the threat of bankruptcy does not exist.

Source.

I would retain two things:

– Greece has never been in a situation where a normal Country can borrow money but lenders still managed to give it a lot. That really questions the work and intelligence of the financial partners. Mistakes have been made..

– A real State framework is fundamental in an economy and the weakness of the Greek State is probably the most important element explaining today’s situation. I didn’t need to read this article to be convinced of that. But it’s pleasant to see a German newspaper emphasizing it, especially when the German government is one of the main supporters of giving the tax collection control (main State’s prerogative) to a European entity. 

February 14th, people marched against the FPI.

In order to protest against radical islamist violence toward minorities, more and more people take to the street. Someone has been seen brandishing a pig plush and a sign hostile to FPI.

Policemen declared that they can’t protect the protesters from the Islamic Defenders Front known locally as FPI, a vigilante group known for raiding bars and nightclubs, to flourish over the last decade.

In more recent times, the FPI has expanded to target religious minorities. The group has forced the closure of churches in West Java and was allegedly at the center of a brutal mob attack on a minority Islamic sect, the Ahmadiyah, that ended in the fatal beating of three of its members in February 2011. The shift in tactics and increased focus on religious minorities has spurred a smattering of citizens to finally speak their mind.

President Susilo Bambang Yudhoyono remains passive regarding the situation.

Sources:

Global post 

Courrier International 

After publishing and commenting David Cameron’s speech at Davos, here I post Ed Miliband’s answer published in the NYT. Not really precise and accurate and very vague, but still, to me it’s so much better than what the british incumbent did! And above all, it’s so different. Both of them are living in the same country and have UK’s best interest in mind, nonetheless they defend two different visions of what they are expected to embody as PM… This one looks more “human oriented”. That’s why I wanted to share it.

At Davos, Debating Capitalism’s Future

By ED MILIBAND, Published: January 26, 2012

IS 20th-century capitalism failing 21st-century society? Members of the global elite debated that unusual question on Wednesday at the annual World Economic Forum.

There was a time, not long ago, when such a debate would have been held only among the protesters who annually shelter in igloos farther down the Alpine slopes. So it is encouraging that more than three years since the global financial crisis, a belated process of soul-searching has begun in search of the right lessons to learn from it.

In Britain, members of the Conservative-led government — not least the prime minister, David Cameron — have echoed the Labour Party’s call for a more responsible capitalism.

There is a great difference, however, between being willing to talk about an issue and being ready to act.

It is a difference between those who still believe that all governments can do is get out of the way and those who believe there is a real role for governments in first reviving our economies, and then setting the right rules for future success. The challenge therefore is not just to capitalism but also to politics.

At the Group of 20 summit in London three years ago, Prime Minister Gordon Brown and President Obama led concerted action to guide the world economy from the brink. Three years later, some governments are engaging in a short-sighted fiscal protectionism that can only lead to stunted growth.

If we learned anything from the 1930s, it was that governments cannot shrug their shoulders and watch as their own people are consigned to unemployment. I find it tragic and astonishing that some governments need to learn this lesson again.

Nor should we forget the causes of the current growth and debt crisis as we seek to put our economies on a more sustainable footing.

Both the United States and Britain suffered because their economies were overly reliant on the financial sector’s artificial profits; living standards for the many worsened while the economic rewards skewed to the top 1 percent; a capitalist model encouraged short-term decision-making oriented toward quarterly profits rather than long-term health; and vested interests — from giant banks to media moguls —were deemed too big to fail or too powerful to challenge.

We need to recognize that the trickle-down promise of conservative theorists has turned into a gravity-defying reality in which wealth has flowed upward disproportionately and, too often, undeservedly. To address properly the squeeze in middle-class incomes on both sides of the Atlantic requires fresh thinking from governments about how people train for their working lives and what a living wage should be.

Governments can set better — not necessarily more — rules to encourage productive businesses that invest, invent, train, make and sell real products and services. We need rules that discourage the predatory behavior of those seeking the fast buck through hostile takeovers and asset-stripping that do not have the interests of the shareholders, the employees or the economy at heart.  In Britain, the Labour Party is considering how we can raise the bar for corporate takeovers so that companies’ futures are not determined by just a handful of speculators.

And governments must remember they are elected to serve the people, not the powerful lobbies who can pay for access or influence. Too often the real enemies of market capitalism are some of the leading beneficiaries of the current model, which favors price-gouging cartels and consumer exploitation. In Britain, airlines need to be more upfront about  the true cost of their fares, and pension firms cannot continue to sign up customers for products that can chip away at their retirement income through exorbitant management fees.

As President Obama noted in his State of the Union address on Tuesday, it is neither socially nor economically sustainable for the wealthiest and most powerful to avoid paying their fair share. I support proposals for a financial transactions tax levied equally on the major trading centers from Hong Kong and Singapore to Wall Street and the City of London. The British government needs to show more leadership on this issue in Europe — and all members of G-20 need to help make it happen.

Britain loses billions of pounds in revenues because of outdated rules that allow our richest citizens to keep their money in off-shore tax havens. Tax authorities need to know about income and wealth hidden behind front companies, trusts and other complex financial products. If these rules cannot be changed by international agreement, progressive governments should go ahead and do it themselves.

As President Obama said in his State of the Union address this week, it is “common sense” to ask a billionaire to pay, proportionally, at least as much as his secretary in taxes. Indeed, in Davos this week, I will look around the room and ask myself who pays taxes at a higher rate — those eating the soup or those serving it?

In my country, I believe that changing the rules of capitalism will mean a change of government. But more generally, it will require a change in what citizens expect and ask of politics. The question is not so much whether 20th-century capitalism is failing 21st-century society but whether politics can rise to the challenge of changing a flawed economic model.

Ed Miliband is a member of the British Parliament and the leader of the Labour Party.

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A small “yes” to EU, 23 January 2012 (Presseurop)

On 22 January, Croats voted in favour of ratifying the Treaty of Accession to the EU, prompting a sigh of relief in Brussels. The record voter abstention rate, however, must give cause for concern, notes the Croatian press.

In Novi List, editorialist Neven Santic welcomes the historic “yes” given by his fellow citizens to joining the EU “despite the efforts of the opponents of European integration and the fears in the minds of many voters.” For Santic –

Croatia has become the 28th member of the European Union. The democratic dream of an optimistic people in the late 1980s and early 1990s has been transformed into doubt over the last two decades, confronted by a reality that’s anything but idyllic because of the problems faced by both Croatia and by the EU, whose workings are far from ideal. But as of yesterday that dream has become the reality we will have to live with. Of course, we must be realistic. Following the referendum, and especially after July 1, 2013 [when membership comes into force], Croatia will not become a land of plenty. The EU is not a remedy against everything that troubles us. It is far from being a personification of Good, an idyllic community of states and nations. It has its problems and its often painful methods for solving them. In such a “community of interests”, Croatia must find its proper place. There are many conflicts, and the Union provides fertile soil for eurosceptics. But for now, there is no doubt that the accession to the EU is a big step for Croatia. The country has lost nothing, and especially not her sovereignty. It can only benefit.

Senol Selimovic, a columnist for Sloboda Dalmacija, a daily from Split, reflects on the “historical record for low voter turnout in an EU membership referendum” that Croats set on January 22:

At 43.6 percent, turnout is the lowest ever recorded for this kind of consultation at a European level. It is even lower than the percentage of Hungarians (45.62 percent) who voted in the 2003 referendum on the future of their country inside Europe. “If the Croatian government had not in the meantime changed the constitutional law on the referendum, the referendum would have failed for lack of voter turnout. But the Croatian political elite avoided this “trap” in time, and they can now clink glasses over the fruits of their long effort to persuade the people on the future of the country… The low turnout, however, does leave a bitter taste, indicating as it does that the arguments put forward by the political leaders in favour of the EU have been unconvincing and that they have failed to inspire citizens to take part in a vote of such historical importance… The Croatian government even betrayed that part of the pro-European but democratically-minded public that denounced the lack of equal treatment for organisations and groups that opposed joining the EU, in terms of financing and media slots to present their arguments. Instead of an information campaign, it has been a propaganda campaign. In place of a historic referendum like that of 1991 (on Croatian independence), in which 83.5 percent of the population took part, the January 22 referendum will go down in European history for its abstention rate.

Augustin Palokaj of Jutarnji List focuses on the sigh of relief that Brussels must have uttered after Croatia’s “yes” vote:

By voting yes, Croatian citizens have shown that joining was not just the project of the political elites, but a project that had their backing too. Nevertheless, the low voter turnout in such a significant popular vote has not gone unnoticed. Indeed, the number of participants, as well as the number of “yes” voters, sends a clear message: Croatians want to be in the EU, but they do not expect great things from it. The EU is not a perfect institution. We can blame a lot of things on the way it operates, but like it or not, it is better to be a member of this Union and fight for our interests inside it. In short, the Croats have no illusions about the EU. There is no room for euphoria, and that’s a good thing. […] Considering the difficult situation the EU is in now, the Croatian “yes” is also a great comfort to the EU, as a “no” would have meant a glaring failure for the Union.

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