We are finishing another edition of the course on soccer and economics at the Study Abroad program of the Autonomous University of Barcelona. Most students are from the USA and one of the groups just presented their essay about the limits to soccer success in their country. Of course, a key issue is that resources are already being spent on other sports, such as American football, baseball and basketball. Although soccer is increasing its popularity because of the expansion of demographic groups such as hispanics and women's soccer is very successful, most fans still see the NBA, the NFL and the MLB as the most important sports leagues. Although basketball is probably expanding and American football is declining (see an article in The Guardian by the famous former basketball player Kareem Abdul-Jabar), they are still above soccer in the preferences of Americans. According to my students, one possible reason is just history: in the XIXth Century, the USA wanted to re-affirm its identity by distinguishing itself from British sports such as rugby or cricket, and that is how American football and baseball started and expanded. This gave them a starting advantage, and the era of big economic growth of the United States additionally favoured these leagues. When soccer became a global industry at the end of the XXth century, it was perhaps too late to become the leading sport in North America. It can still grow of course, and the elimination from the next World Cup should not be seen as a drama (at least, they will be in the good company of Italy, The Netherlands and Chile). Countries that do not have a strong soccer tradition can easily catch up by importing resources such as managers or veteran players, or by exporting their best players to the best leagues and asking them to come back to play for the national team, as explained by Branko Milanovic in an article published in 2006. But once they achieve a decent level, they find much more difficult to achieve excellence. Like in other industries, imitation is easy but excellence requires innovation and the creation of new styles of doing things, and this probably only comes with role models, cultural environments and strong communities transferring a passion for something from generation to generation. That is what is argued in a recent academic article by Stefan Szymanski and Melanie Krause. Perhaps that is why Messi is Argentinian and not form the USA or China -although many are trying to produce "the new Messi," in some cases with a lot of money.
I started reading this article in The Guardian by Matthew D'Ancona believing that it would relate the Isareli-Palestinian conflict with the Brexit controversy about Northern Ireland (something that keeps my analogy-prone mind in good shape), but I found something much better. Actually, two things. First, a great metaphor about the lies of Brexit based on the re-invention of the wheel: "So, here’s an idea: let’s abolish the wheel. Let’s escape the tyranny of
the circular device, and spend the money saved on axles, spokes and hubs
on – oh, I don’t know – the NHS.
Let’s take back control of rotation! But wait a minute. This can’t be
done overnight. We shall still need some means of transporting ourselves
and our goods until we have formally renounced the wheel, but before we
have agreed on a new device. There’ll probably need to be an
“implementation period” in which we remain “aligned” with the existing
circular format. Then, when we’ve finally got rid of the old system – let freedom ring! –
we’ll need a new, bespoke mechanism. What we’ll want is our own round
component that rolls around an axis; an independently designed disc that
turns reliably to enable easy movement. Something that gyrates smoothly
along the ground. I wonder what we should call it." Second, a very useful insight about clarity and ambiguity, which should be read by those in Spain and Catalonia that fell in love with the Clarity Act of Canada: "As so often, it was our old friend “constructive ambiguity”
that got May, her party, the Irish government and Brussels over the
line. You can read the text as a victory for British sovereignty, a
significant retention of power by the EU, a step towards Irish unity or a
safeguarding of the union. This kind of ambiguity was essential to the Good Friday agreement, which
entrenched an open-ended process founded upon euphemism. In contrast,
the Brexit talks assume and depend upon the eventual achievement of
clarity – even if, in many cases, that point is not reached until long
after the UK’s formal departure on 29 March 2019." And to wrap it up there is a final part of the article that is the perfect illustration of the big topic of behavioral political economy: expressive voting versus rational choice. I leave it to you to enjoy it.
James Atlas is the biographer of two American writers, the forgotten poet Delmore Schwartz and the famous Nobel Prize winner Saul Bellow. I have never had the opportunity to read these two biographies but now I will try to buy and read them. What I have read is the wonderful autobiography of Atlas himself, where he explains how he became a biographer, and he tells us some of the secrets of his speciality, starting with what he learned at Oxford (a place he didn't particularly enjoy) in the beginnings of his career. I knew about the book after reading a positive review by a Spanish writer in a newspaper. The book, entitled "The Shadow in the Garden. A Biographer's Tale," is a love letter to books and book writers and critics in general. Atlas tells us about his emotions and physical sensations in those moments where he lived through experiences such as finding some special document or meeting some important character. He is also very open about his tension with Bellow and the many flaws of this author as a human being. The difference between Bellow and Schwartz from the point of view of Atlas is that he never met the latter (although he shared with him the problem of depression) but he interacted frequently with the former. The last chapters of the book discuss the future of biography. In the past, writing a biography was about collecting documents such as letters, personal journals and objects, unpublished manuscripts, and interviewing people who had interacted with the subject of the book. With the Internet, email, social networks, blogs and you tube, the lives of famous authors are very much in the public domain. Perhaps it will not be about writing a biography any more, but about putting together materials in a web site. But then many of the emotions associated with the old art of a biography will not be there any longer.The footnotes are not to be missed, full of irony and interesting insights to complement the general text. I really enjoyed reading this book.
For anyone who has been paying attention, it should be no surprise that detailed and nevertheless fragile peace agreements that were reached in the 1990s are today in danger because of the rhetoric, the actions and the events unleashed by national-populist forces. Brexit threatens the results of the Good Friday agreement reached almost twenty years ago after decades of violence in Northern Ireland. That agreement was not perfect, it was complex and multilateral. It had even some disturbing elements, like the obligation to "share" a government between religious parties, accepting de facto the "tagging" of organizations and voters, instead of promoting that one day the province could be dominated by a secular multicultural political force or several of them. More importantly, the agreement was made possible by the existence of the European Union, which facilitated a legal and economic framework that produced the dilution of the border between Northern Ireland and the Republic of Ireland, as it happend for example between Spain and Portugal (I still laugh when someone wants to seem modern by asking for an Iberian federation -we already have it! It's called European Union). The two parts of the island can share today a common economic and trading area and even an electricity system. Each part probably believes that it is sovereign, but the border disappeared twenty years ago, which means that even unconsciously they have been sharing the same territory. And it has been good for them, as the island has probably lived through the most prosperous and peaceful period of its contemporary history. Now Brexit threatens this, because British voters by a small margin decided to leave the EU in a simplistic referendum by a very small majority, even if the voters in the Northern Ireland province voted to remain, as they voted in favor of the Good Friday agreement almost twenty years ago together with the voters of the Republic of Ireland. That was a complex and patient agreement, the result of multilateral negotiations. The extremists in the British conservative party and the extremists among the Northern Irish unionists have a hard time trying to make compatible Brexit with the Good Friday Agreement. In fact, they are incompatible, and probably the only solution is either to acknowledge that Brexit as it has been imagined by its proponents is impossible, or to construct a special regime in Northern Ireland without saying it to save the face of the Unionist and the British government. In the Middle East, the Oslo peace accords were also fragile and imperfect. In a perfect world, instead of a two state solution we would have a plurinational federal state as suggested by the late historian Tony Judt. But it was also a multilateral agreement that laid the foundation of future peace negotiations. Donald Trump does not want any of it and is willing to sacrifice decades of good will and slow progress to demonstrate that his rhetoric must prevail. Our world is interconnected and the decisions of British or American voters have effects on third parties. But a characteristic of national-populists is that they do not have time for complex agreements or institutional constraints. The problem is that some of these constraints keep the world in relative peace.
The weeks that surrounded the illegal and suspended declaration of independence in Catalonia coincided with a 4% reduction of the retail sales in the region, the exodus of the headquarters of 2800 firms (among them, the two largest banks and some of the most important companies), the fall or postponement of tourist reservations and investment plans, and the transfer of savings to accounts in other regions. It is tempting to conclude that pro-secession leaders lack any knowledge of the economy or any knowledge of the mechanisms of the rule of law in a European member-state of the XXI Century. We could easily blame bad selection mechanisms in political elites or even the poor educational system in general in Spain and Catalonia. However, the Catalan pro-secession movement and the regional government that has represented it in the recent past have been supported by first-rate intellectuals, among them several economists with a PhD from US universities, philosophers fluent in Germany and experts in Wittgenstein, or legal scholars with previous high reputations among their peers. On October 10th, the day in which the now sadly famous Catalan former president Carles Puigdemont said that he acknowledged the results of the illegal referendum of October 1st and then added that he suspended the declaration of independence temporarily, his cabinet met in the morning prior to that Parliamentary speech to decide on the strategy. In that meeting, all the members of the regional government agreed that it was better to suspend the declaration and try to offer a more moderate face, given the hundreds of companies that were already announcing that they were leaving the region and given the zero prospects of international recognition. Only one member of the regional government disagreed from her by then scared colleagues by proposing to go all the way down and declare independence immediately without fear of any consequences. That was the regional Minister of Education, an economist with a PhD from Minnesota University in the USA. Today Paul Krugman has written in his blog about the betrayal of many intellectuals of the US Republican Party, their refusal to apply scientific or moral standards when they evaluate the policies of their party. Krugman alludes to the title of a famous book ("La Trahison des Clercs") by a French intellectual in the first half of the XXth Century, where he denounced the many intellectuals that supported nationalism or stalinism. We could similarly refer to the betrayal of many intellectuals, Catalan edition (incidentally, one of the Republican intellectuals mentioned by Krugman is a co-author of one of the most radical Catalan economists). In the blog of the LSE there is a review of a recent book on how European governments are these days more and not less crowded with academics. The regional Minister of Finance and Economy of Catalonia was in October a Historian with a PhD, like Gordon Brown. The difference does not lie in the academic credentials (although I suspect that the PhD dissertation of Mr. Brown was much better than the one written by Mr. Junqueras). The difference lies in the moral compass, which in the case of Brown made him give that famous speech against nationalism ("the silent majority will be silent no more") that most probably decided the 2014 Scottish referendum.
in a recent article written by a former central banker
of Argentina and a co-author:
for amending the design of some of democracy’s existing commitment devices.
These relate to the judiciary, media, central bank, regulators – the elite’s
expertise and the experts themselves. The current commitment devices and
institutions don’t seem to be fully sufficient nor entirely credible
(depending, of course, on the country and its institutional history). These
institutions should be improved immediately by introducing what we call a
‘second generation’ of commitment devices. These are specifically designed to
materially improve existing structures through stronger and more credible
accountability elements, for both the institutions and the elite. They can
reduce the populist’s incentives and ability to introduce measures that would
quickly and disproportionally favour him and allow him to enhance his grip over
the initial benefits.”
“second generation commitment devices” require a careful study of the biases of
regulators and a careful study of the behavioral issues that surround the
political arena in which they work, because the forces of populism do play with
these tools. Before embarking on the specific or generic reforms suggested by Mario Blejer and Piroska Nagy-Mohacsi in that
article, such as periodic reviews of regulatory institutions or focusing more
on fair process than outcomes (as well as “allocate resources
to improving the public’s understanding of the long term costs of unsustainable
policies”), it would be useful to have
a better knowledge of the characteristics of the decision-making process of the
individuals that participate in regulatory decisions.
Mainstream political operators respect the existing institutional constraints and functioning of politics, but these are often under criticism. As another recent article on the supply and demand of populism suggests, new leaders are then very tempted to break away from one form or another of existing constraints. These constraints can be formal or informal, and it is not unusual that national-populist leaders, at the same time that they propose walls or exits, they also depart from inherited conventions and use strong rhetoric or ride the waves of the mob rule. The answer should be serious institutional reforms.
As Catalan former president Carles Puigdemont blames "Madrid" and now even the EU for all his problems, I find this paragraph in a new article about populism very suitable, especially where it says that when he finally fails to deliver, the populist finds someone else to blame for spoiling the party: "The populist wants, of course, to complete his takeover of the system before the negative consequences of his policies start to bite. But if he cannot achieve this objective he ‘doubles up’, raising his populist bets. Policies that benefit his constituencies gain priority while deficits, inflation, debt, and/or state intervention, price control, and protectionism increase as democratic institutions crumble. Again, the populist leader is ‘time consistent’ – he expected these results and never intended to pay for those costs, financed through the use of financial and physical repression, default, institutional destruction, expropriation, etc. He continues to promise massive gains in output, employment, trade, and so on, and when he finally fails to deliver, he finds someone else to blame for spoiling the party. He starts resorting to extreme policies (undue pressure on business leaders, state interventions in various forms, nationalisation, and so on) particularly before each election cycle. He also goes after individual freedoms, and institutions whose remit is to protect them." The academic literature about populism will learn a lot from the Catalan case and the neo-populist tricks of the secessionists, which can also be illuminated with the academic literature about conflict (violent or not). Ethnic conflict (ethnic in a very general sense, as based on a marker different from income) is more sustainable than income conflict because ethnic groups include rich individuals that have the resources to sustain conflict over time. As Esteban, Mayoral and Ray argue in an article in Science, "such markers can profitably be exploited for economic and political ends, even when the markers themselves have nothing to do with economics. A study of this requires an extension of the theory to include the economic characteristics of ethnic groups and how such characteristics influence the supply of resources to conflict."
Until very recently, it was usual among political scientists and commentators to say that Spain was relatively free of populist parties. That was before the constitutional crisis triggered by the attempts by Catalan secessionists to unilaterally declare independence. Of course, for those who had been witnessing the sustained pro-independence campaign in the recent past, the crisis and its populists features were no surprise. For example, an otherwise very interesting article by Inglehart and Norris based on empirical evidence that includes Spain, has no mention of the Catalan issue. It argues that one of the characteristics of populism, beyond nativism, is the rejection of representative democracy and the checks and balances that accompany it, and a preference for pebiscitarian mechanims. This is clearly present in Catalonia. It has to be said that it also mentions as usually accompanying populism some characteristics that accompany populism in some countries, but probably not in Spain and Catalonia: the cultural rejection by relatively old and not highly educated white males of the values of cosmopolitism. The authors of this article chacraterize populism as a dimension (endogenously obtained using factor analysis, which depends on the original variables being used) that goes from liberal cosmopolitism to racist reactionarism. This makes it difficult to analyze the Catalan/Spanish case. For example, when they plot parties from all European countries in a two dimensional graph with left to right in the horizontal axis and reactionary to cosmopolitan in the vertical one, the Spanish parties are in an almost perfect diagonal, with Podemos in the bottom left and the Popular Party in the top right. That is, in Spain, it would seem that populism is correlated with being right-wing. According to this, Spain would have only one dimension in practice. In the article they say that they classify as populists all those parties that score higher than a threshold as cultural reactionaries, but then in the list of populist parties in Europe they include Podemos, which if I read correctly, in the two-dimensional graph scores very low as reactionary (actually, it is the Spanish party with a lowest score). However, Podemos clearly satisfy the condition of favouring direct instead of representative democracy, and other features of populism such as neglecting the long run impact of their policy proposals. Moreover, in the two-dimensional graph, two centrist parties that were created to raise the flag of Spanish nationalism against Catalan nationalism, UPyD and Ciudadanos, score just average in terms of populism (precisely because populism is defined according to variables that are probably irrelevant in Spain). In this two-dimensional graph there are two Catalan political parties, ERC and CiU, the first close to Podemos and the second close to the Popular Party in the graph. However, these two parties have governed in coalition in the Catalan government and have been those in charge of the unilateral attempt to declare independence. There is a lot of work to be done to include the Catalan case in the analysis of populism. There will be no shortage of useful material.
Academics are professionals whose job is teaching and doing research. Their teaching and their research is evaluated ideally using objective high standards. Of course, academics, as well as citizens in other professions or without a clear profession, are entitled to their political opinions, like the author of this blog. However, academics in the field of social sciences are often in demand to produce opinions that are sold as scientific truths. There are some problems with this. Quite often, the same individual that uses very qualified and careful terms in a scholarly article on some topic, exudes self-confidence and even arrogance when addressing the same topic in some format addressed to the political arena. Probably the most well-known case in history, at least in economics, is the support of many members of the Chicago School to the Pinochet military dictatorship in Chile. Authors who had top scientific articles on macroeconomics and microeconomics gave their full support to a bloody regime that violated all basic human rights. Of course, they could not publish any article defending the Pinochet regime with the same clarity as they supported it in real life. The problem arises when academic institutions create debate platforms where they encourage academics to express their political opinions. This has been made easier with the Internet and social networks. For example, a few days ago, an on-line platform of a well known higher education international institution contained an opinion piece by a Catalan pro-independence academic where he defended the argument that the current problems in Catalonia and Spain where caused by the "failure of Spanish federalism". Of course, the very imperfect quasi-federal system of Spain has many problems. Actually, many people like myself defend reforming it not to become less, but more federal. But it seems difficult to attribute responsibility for the current constitutional crisis to federalism, when the instability and aggressivity of the attack to the democratic rule of law by a pro-secession regional government has triggered the decision of more than 2000 large firms to move their headquarters, the opposition of all European leaders and institutions, and a serious threat to social cohesion. The period of quasi-federalism and decentralization between 1980 and at least 2006, although it could have been managed much better, has been the period of higher freedom, welfare and self-government in the history of Catalonia. It is impossible that the same author would have published a similar article in a scholarly journal. This is his opinion, which he holds not because he has reached it by using the scientific method, but just because his identity politics and ideology determines that he has this opinion. The same mechanism affects academics, sports players, clowns and anyone else.
Two authors I follow have recently written interesting pieces about Catalonia. Simon Kuper, the sports (and more) journalist of the Financial Times, writes about "Us and them: Catalonia and the problem with separatism." I am afraid it is not always easy to access an article at the FT, so here it goes an extensive quote (I hope this is not illegal...): "I’m a fan of Catalonia but Catalan separatists are separating people. Their slogans say, “Spain steals from us!” or “Catalonia is not Spain”. Rhetoric like this divides people into opposite groups, each with a single identity: us (Catalans) and them (Spaniards). You must be one thing or the other. The government in Madrid unintentionally sharpens this divide by imposing direct rule on Catalonia.Someone else who thinks in terms of single identity is Donald Trump. As he tells it, you’re American or Muslim; you’re a real American or a liberal elitist. There’s an uncomplicated joy to single identity: find your essence, then taunt an enemy who doesn’t share it. And along with your identity comes a free set of opinions that you never need to test against reality (...)." After arguing in favour of the diversity of identities promoted by economist Amartya Sen in his book on this topic, Kuper finishes his article like this: "If you want to persuade people who don’t share your one particular identity, you need to appeal to some of our shared identities. Lilla writes: “I am not a black male motorist . . . All the more reason, then, that I need some way to identify with one if I am going to be affected by his experience . . . The more the differences between us are emphasised, the less likely I will be to feel outrage at his mistreatment.”The economist Branko Milanovic recently described what he learnt from the bloody break-up of his native Yugoslavia: “Be considerate. Think of people as persons. And do not impute to them opinions just because of their nationality.” It’s handy advice for today’s fragile societies such as India, the US and Spain." Thomas Piketty has a blog post where he brilliantly addresses the taxation implications of separatism in the context of the process of European integration: "Europe also bears a great deal of responsibility in this crisis. Apart
from the catastrophic management of the crisis in the Euro zone, in particular at the expense of Spain,
for decades now Europe has been promoting a model of civilisation based
on the idea that it is possible to have everything at the same time:
integration in a large European and world market, without any real
obligation for ensuring fiscal solidarity and the financing of the
public good. In these circumstances, why not try one’s luck by making
Catalonia a tax haven along the lines of Luxembourg? To be sure, there
is a federal European budget but it is very small. Above all, it should
logically be based on those who benefit most from economic integration,
with a common European tax on corporate profits and the highest incomes,
as is the case in the United States (one could also endeavour to do
better, but we are far from this). It is only by ensuring that
solidarity and fiscal justice are at long last central to its practices
that Europe will successfully tackle separatisms."
While the UK is slowly declining and under the risk of isolation after a hard Brexit, many realise that they should have paid more attention to their own federalist tradition. One of the heirs of this tradition, Brendan Donnelly, recently published an article arguing that Brexit will be an absolute disaster. Here's what he says:
"It would be a bold person who would predict with certainty whether Brexit will occur on its appointed date in March 2019. Much has been made of issues relating to the revocability or otherwise of the Article 50 notification, to the desirability or otherwise of a second British referendum on the terms of Brexit and to possible reconfiguration of the British party political system. Whether Brexit occurs or not resolves itself in the last analysis into a simple question. As the negative consequences of Brexit unfold and become more manifest, will there be enough MPs from a range of parties with the courage and conviction to stop it?
So far, this is emphatically not the case. Despite its spectacular incompetence and bad faith, the present Conservative government still determines the Brexit discussion in the UK. It is however entirely possible that changing public opinion will interact over the coming months with latent (and not so latent) concerns among many MPs to produce a substantial majority hostile to the only kind of Brexit which can realistically be achieved. If that is so, questions about the revocation of Article 50, a second referendum and new political parties will fall into their as yet unpredictable place. It would be a stupendous but entirely conceivable irony if next year’s robust assertion of British Parliamentary sovereignty was not to embrace Brexit as a resumption of “control” but rather roundly to reject the whole Brexit chimaera."
Brendan Donnelly belongs to the Think Tank The Federal Trust and to a tradition that was pioneered decades ago by Lionel Robbins, William Beveridge and other great British personalities of different ideologies. This British tradition is unfortunately not known enough, but it was very influential in European federalism, for example through the Italian communist Altiero Spinelli. Their ideas are today being promoted among others by Will Hutton, Timothy Garton Ash and many centrist and labour individuals that believe that citizen control can only be exercised when it is effectively shared with others.
context of the holdup problem in regulation (the regulator facing incentives to
hold up the sunk assets of the firm), I can see from my current research that potential
departures from the traditional assumption of rationality in regulators of
network industries (or other similar) can be classified in three categories:
-Satisficing behavior or similar
departures from standard preference or social welfare maximization: regulators
have been observed to try to avoid problems and keep a low profile (minimal
sqwak behavior, omission bias). Similarly, their behavior seems to differ
depending on age or professional background. There is also a literature on the
impact on decision-makers of apparently irrelevant factors such as mood,
hunger or similar. -Expert Bias: regulators are not immune
from some psychological biases like availability bias or confirmation bias or
herd behavior (for example, in sports referees). There is a corresponding
literature on de-biasing mechanisms or factors that contribute to diminish the
influence of behavioral anomalies (like technology or monetary incentives). -Process: one of the findings of
behavioral economics is that individuals care not only about outcomes, but also
about processes. That opens up a new set of policy tools for regulators and
regulatory institutions. Reforms or policies are better accepted when they are
“owned” by citizens, rather than imposed from external forces, as shown in
experiments. The Acceptability/Legitimacy of regulatory
decisions that may be vulnerable to populist pressure depends then on
narratives or “stories,” as argued by Akerlof. The endogeneity of preferences and social norms matters for the success of efficient reforms and policies.
Knowing better and taking into account these phenomena may help design or nudge institutions to make them more effective and robust.
The pro-business center-right Catalan leader who started the current drive for independence, Artur Mas, expected to extract an electoral gain from a snap election in 2012 just by hinting at a possible and ambiguous call for an independent state. He did not obtain as many gains as expected in that snap election, but five years from then, the campaign he started has created instability in a European democracy, which now has even been exported to another one, Belgium. In the meantime, more than 2000 companies have moved their legal headquarters out of Catalonia, and the region has lost temporarily its institutions of self-government. What better exemple of the illusion of control can we find? This illusion is frequent when we believe we can choose outcomes, instead of strategies or actions, and when we neglect the influence of chance events and the decisions taken by others on our own decisions. National-populists accompany their illusion of control with the claim that they want to take back control, only to realize that in a globalized world this is not completely in their hands. In nationalist conflicts, what initially seems nice and even fun, can very soon follow a slippery slope. A video by Stephen Colbert in a US TV network has shown to many the potential for simplification of nationalist controversies. I wonder if Colbert had so much fun with the problems of the former Yugslavia before the eruption of the Balkan wars. The video repeats many of the post-truths (taking part of the truth and manipulating it) of nationalism:
-It is true that an elected government is partly in jail, but that is because a judge has ruled that before a trial where they will be judged for breaking the law there is a risk of evasion (the president has gone to Belgium) and they may destroy evidence. I would have preferred that they were not arrested, but I guess that if Trump or a state governor in the US breaks the law something will have to be done with them.
-Actually Catalonia is not overtaxed as Colbert says, any more than California is overtaxed (they are rich societies that contribute into an improvable progressive tax system).
-Comparing Catalonia in 2017 with the US in the late XVIII century...
-Franco did suppress the Catalan language, but also many other things in the whole Spain, like other languages and freedoms. Many Catalans, like my grandfather, fought with Franco. The Civil War and Francoism were not Spain vs Catalonia, but fascists Spaniards and Catalans against democratic Spaniards and Catalans.
-Catalans do not pronounce Barcelona in one way and Spaniards in another, but more than half of Catalans have Spanish as first language (not my case) and pronounce Barcelona the same way as people in Madrid.
As you reader can see, things are more complex than TV talk shows would like, and we Catalan federalists have a very hard battle...
I know that some people in the US know much better than this, like Roger Cohen of the New York Times. It is not me, it is American historian Timothy Snyder who says that post-truth is pre-fascism.
It has been a coincidence that more or less the same days that the Mueller's investigation gets closer to Donald Trump's inner circle, the Spanish justice has called former Catalan president Puigdemont for interrogation. In normal times, with normal political leaders, politicians do not have problems with justice, except perhaps for sexual scandals or corruption allegations. But the problems of Trump and Puigdemont are of a different nature, they have to do with the lack of respect of these leaders for the regular democratic process. A characteristic they share with other national-populists is their institutional relativism. They seem uncomfortable with the division of powers between the judiciary, the executive and the legislative branches of government. They do not seem to understand that democracy requires rules, constraints, checks and balances. The Catalan secessionist movement had planned to declare independence after a referendum organized by themselves, without bothering first to reform the Spanish Constitution that prohibits it (as these things are prohibited in almost all democracies in the world). In the pretend legislation that accompanied their fake self-determination attempt, they had passed a provisional Constitution (with the votes of half of the members of a regional Parliament representing less than half of the regional voters) that subordinated the judicial branch to the executive branch, in practice trying to eliminate the independence of justice. As the circus of Mr. Puigdemont has moved to Brussels (let's leave the word exile for those who really suffered it under tragic circumstances), the international media have now a clearer idea of the conception of justice of the Catalan national-populists. As an expert has told The Guardian in a useful article, “you have two competing visions of democracy that we see replicated across the west. One is a so-called plebiscite, people’s will democracy against a pluralistic, institutional and rule of law democracy. The current leaders of the secessionist camp have been arguing that they represent the people of Catalonia but they only represent a part of it.”
Political scientist Daniel Tresiman argues in a new academic article that in transitions to democracy "influential theories contend that incumbents deliberately choose to share or surrender power. They do so to prevent revolution, motivate citizens to fight wars, incentivize governments to provide public goods, outbid elite rivals, or limit factional violence." Examining the history of all democratizations since 1800, however, he shows that such deliberate choice arguments may help explain only up to one third of cases. "In about two thirds, democratization occurred not because incumbent elites chose it but because, in trying to prevent it, they made mistakes that weakened their hold on power. Common mistakes include: calling elections or starting military conflicts, only to lose them; ignoring popular unrest and being overthrown; initiating limited reforms that get out of hand; and selecting a covert democrat as leader. These mistakes reflect well-known cognitive biases such as overconfidence and the illusion of control." Although the methodology used by Treisman is open to discussion (trying to put into conceptual boxes more than one hundred stories), the conclusions are suggestive and surely at least part of the explanation. The same explanations might be applied to attempts to change the course of history through sovereignty conflicts. Both in the Brexit process and in the Catalan independence movement we have seen a lot of hubrys from leaders. Overconfidence and the illusion of control from David Cameron or Artur Mas have led their societies to be guided by movements that escaped from their hands. They called referenda or elections that went not as expected. Other leaders or the same ones made overoptimistic claims (from their perspective) that were not confirmed by experience. Nationalist leaders claimed that they would take back control (what better example of the "illusion of control"). The book "The Ostrich Paradox" explains how badly we are prepared for disasters due to among other psychological biases, overoptimism. Many that are not nationalists (myself included) have also behaved like ostriches, by not acknowledging the seriousness of what was happening around us. However, the world, or at least Europe, will evolve with all our mistakes in a reality that is globalized and interconnected. This world will select those governing institutions that are fitter for survival. Will we stumble into federalism?
As it is usually the case in many sovereignty conflicts, the federalist perspective emerges as a reference point for solutions based on dialogue, negotiation and respect for the rule of law and democracy. This is not surprising, as most people who live in democracy in the world do so in federations, and some of the richest and most stable societies are federal in nature. In the case of Catalonia and Spain, it has been not only local scholars or politicians who have suggested this way forward, but also prestigious journalists or writers in the international media such as Roger Cohen in the New York Times or Will Hutton in The Guardian. In a recent debate in the European Parliament, the current leader of the European liberals, Guy Verhofstat, made a passionate defense of the federal principles as a guide to leave behind the current conflict in Catalonia.
In the local political arena, the federalist positions are defended by a number of organized groups, among which the association Federalistes d'Esquerres based in Barcelona is the strongest one, although there are also federalist groups of the civil society in Andalusia, Aragon, Cantabria and Madrid. The Spanish Socialist Party, encouraged by its Catalan branch, is officially in favor of a federalist solution, and several representatives of other parties, including Ciudadanos, Podemos and the Popular Party have spoken in favor of federalist reforms. The current leaders of the Basque Nationalist Party have also spoken of a pluri-national Spain in a federal Europe. A documentary is currently being produced by award-winning film director Albert Solé that collects many of these voices.
Spain is already a very decentralized country, but some federalist reforms would make it closer to more stable and consolidated federations. These reforms would include:
-The full support of the Spanish Constitution to the European Project of integration and transfer of sovereignty in a number of areas to the European Union and the Eurozone.
-A reform of the Senate, so that the current autonomous communities (federal units in a future federal state) can participate in solutions to common problems. This reformed institution could then decide on the allocation of funds for large infrastructures or similar common problems.
-A clarification of the responsabilities and financing mechanisms of the different government levels. This is now scarcely transparent. A good suggestion is to clarify in a self-contained list the responsibilities of the Spanish federal level and leave all the others (by default) that do not belong to the European level, to the federal units and municipalities.
-Accept the multi-lingual nature of the Spanish society and adopt a language regime similar to that of Canada, Switzerland or Belgium, instead of the current one where languages other than Spanish-Castillian are relegated to the autonomous regions.
-Locate some services and headquarters now based in only one capital, Madrid, in several other cities, as it is done for example in Germany and other federal countries. The Senate itself, for example, could be in Barcelona or in another big city.
Both Spain and the European Union should converge to a flexible multi-level federal democracy. Spain should evolve in this direction from its origins in a centralized unitary country. And Europe should evolve in this direction from its origins in a set of powerful sovereign nation-states. The nation-state is an obsolete institution, and our increasingly global problems (climate change, inequalities, migrations) require new institutions adapted to the new realities.
Those above are some concrete proposals, but in the case of Spain they could be adapted to the results of a necessary dialogue and negotiation among different political parties and governments. The federalist positions have a wide support. For example in a recent GESOP poll, 46.1% of Catalans defended that the outcome of the current secessionist conflict should be an agreement with Spain to increase self-government, whereas only 36% defended a secessionist outcome. When asked about this option, it is usually the most preferred by Spaniards and Catalans, above secession, status-quo or re-centralization. But it would also be the most natural outcome of a negotiation if all parties (including Spanish and Catalan nationalists) were somehow forced to reach an agreement instead of incentivized to cultivate conflict as they are now. The federalists are often characterized as "unionists" by separatists, but this is a word that is absent from Catalan political traditions, and it is used to try to associate those opposing independence to radicals such as the late Rev. Paisley in Northern Ireland. In fact, what we should learn from Northern Ireland is not the style of this leader, but their method to reach a very broad agreement in the context of the European Union that was finally voted in a referendum to facilitate peace and stability now for twenty years. Since the XIXth century there have been very strong federalist movements in Catalonia and Spain, and their voice is more and more heard today as citizens try to find light at the end of the tunnel in which the conflict is dangerously paralized at the moment.
I am a viewer and admirer of BBC World. I have received these days a WhatsApp message that apparently media firm Mediapro has been circulating. This media company is, according to the message, producing a debate for the BBC that will be conducted by the prestigious journalist Stephen Sackur. In the message, the producers are saying that they are looking for 100 independentists, 100 "unionists" and 100 neutral/undecided individuals. I have no doubt that a rigorous program conducted by Mr. Sackur can be a very interesting and helpful contribution to the events that we are experiencing in Catalonia. However, I believe there are reasons to question the choice of partner and the framing of the debate. Mediapro is a company that has strong links to the secessionist groups. Beyond this, it is a company that has been or is still being investigated by the FBI for the involvement of its subsidiary Imagina in the FIFA corruption scandal (you can check this by googling Imagina, FBI and FIFA or replacing Imagina by Mediapro). The role of this media company in Catalonia is not very different from the role of the British public relations company Bell Pottinger in Southafrica that was recently denounced by the Newsnight programme of the BBC for profiting from the promotion of social division. The full story of the relationship between Mediapro and the secessionist movement in Catalonia is explained in the "serious" pages of the satiric magazine Mongolia (the Spanish "Charlie Hebdo") last summer (unfortunately, not available online). Beyond this, the binary narrative that these producers are using to promote the debate, is very unfortunate. The word "unionist" does not belong to the very rich history of political movements in Catalonia or Spain. Instead, it was introduced in Catalonia by the organized pro-independence movement to associate those who oppose independence (who have very different views among themselves) with a radical unpopular movement. I can assure you that there are no followers of the late reverend Paisley in Catalonia. There has never been a so-called "unionist" movement in Catalonia. People like myself are neither independentists, nor unionists, nor neutral. We are federalists, like at least 40% of the population according to surveys. Why not frame the debate between federalists, non-federalists and neutral? Why not frame the debate in terms of pro-European, anti-European or neutral? Because that does not play into the hands of those that have used the self-government institutions of Catalonia to promote a nationalist agenda leaving aside the rule of law. Please make sure that this message reaches Stephen Sackur.
The "Prodi doctrine" of the European Union (EU) says that any region that breaks away from an EU member state will automatically leave the club and have to reapply under the usual rules, a lengthy process. This is what The Economist says this week about the argument made by Catalan secessionists that instead the EU is no obstacle to create an independent country: "This tips some Catalans into magical thinking. The Prodi doctrine was a throwaway remark with no legal standing, they argue. Should Catalonia win its freedom, Europe’s leaders will put pragmatism before principle and ensure its place in the EU remains unmolested. Independence-minded business groups even suggest that worried German investors in Catalonia would lean on Mrs Merkel to shield it from ejection. (Brexit-watchers will recognise this questionable line of thinking.) It is hard for dreamers to swallow, but the existence of the EU has become the best guarantee of its members’ territorial integrity. For separatists, the EU once looked like the net that would guarantee their safety as they leapt into freedom. Instead, it has become their cage." This begs the question of why so many Catalans have been deluded by magical thinking. The answer may lie in another piece of the British press, in this case in an article in The Guardian by Peter Preston: "Catalonia has had its own television and radio services since 1983, delivering Catalan-only language programmes and – guess what? – paid for by the same government that declared quasi independence a few days ago. Bias comes naturally, perhaps inevitably, in the reporting of poor anti-separatist demonstrations, in the constant flashbacks to civil guard police wielding batons and throughout the hours of political discussion (...)" Many people living in inland Catalonia "have lived in a media cocoon of settled opinion, convinced that the EU will welcome their new nation into its midst, that the economic outlook is untroubled, that “taking control” will solve all problems. Passion becomes ingrained. No need to draw parallel conclusions closer to home, but this mingling of fact and conviction crosses many borders. If you can make the rest of the world go away, then doubt becomes a stranger (...). How did Catalonia wander so close to the edge of a cliff? Because – on screen, on the airwaves, in cosseted print – there was no real debate. Because (think Fox News) the semblance of real debate was quite enough, thank you."
It is a contradiction that many, but not all, well-meaning commentators on the Catalan issue advocate for dialogue and reforms (in a federalist direction) and also advocate for a legal and agreed self-determination referendum, "like the Scottish one." It sounds nice, but it is not. A referendum like the Scottish one does nothing to promote a dialogue that favours federalist reforms. Actually, the federalist option was not even in the ballot in the Scottish 2014 referendum. Most democracies in the world, that unlike the British do have a written Constitution (except Ethiopia, Liechstenstein and Saint Kitts and Nevis) either do not allow or explicitly prohibit a self-determination referendum of part of the country. That is, the best democracies in the world, like France, Germany, the USA, etc., would never allow this in their countries.The United Nations only approves of them for colonies or countries with human rights violations. The Council of Europe argues that any referendum about sovereignty must take place under full compliance with the constitution when this is democratic. The Spanish constitution does not allow it, but it could be changed, which takes time and convincing many people like me that are unconvinced. Some people, including the Catalan president and leader of the independence movement, argue that such a legal and agreed referendum should take place because the majority (of Catalans) want it. Probably the majority, which by the way does not favor independence (a myth demolished in an article in the Washington Post) compares this option with the reference point of a regional government trying to organize a vote out of the democratic rule of law. But to do something just because it is consistent with something people say they want when asked is not a good justification in a mature democratic society with high institutional quality, with checks and balances, and honest leadership. A self-determination referendum is what has plunged the UK into political chaos and economic uncertainty, but it is what parties like the Front National in France or the Northern League in Italy want to do once in power, either to leave the EU or to seggregate a part of their country to escape solidarity mechanisms. A referendum is also the preferred tool of Wilders, Orban, Erdogan and Putin. In some historical junctures they can be useful if they can unite all those in favor of peace and democracy, like in Spain in 1978, in Chile in 1988 and in Northern Ireland in 1997. But in the hands of leaders who want to play games with the rule of law, it is a tool that does little to preserve reasoned debate and the expression of political preferences in a way that fits with the collective will of neighbours and people with whom sovereignty is shared, in this case both in Spain and in Europe. A self-determination referendum is an instrument to institutionalize conflict, and conflict favours nationalism, as argued by the article in the Washington Post. Doing well a bad thing is worse than doing it badly.
Richard Thaler was yesterday awarded with the Nobel Prize in Economics. After the Nobel prize to psychologist Daniel Kahneman some years ago, it is the second direct recognition of this institution to the merits of behavioral economics, the discipline in the intersection between economics and psychology. Before Kahneman, and before people used the concept "behavioral economics," Herbert Simon, who coined the concept "bounded rationality" and worked on it, also received the prize, as a student of mine reminded me in class. It is debatable whether Thaler has more merits as a generic promoter of the idea in books for the general public (like "Nudge," written with the celebrity legal scholar Cass Sunstein), or as a deep social scientist with frontier contributions. But the prize is a recognition that behavioral economics is already part of the mainstream. Other scholars that have received the Nobel prize, like Jean Tirole, George Akerlof, Robert Fogel, Robert Shiller and Elinor Ostrom have also been influenced by these ideas. The Economist says that "From a renegade offshoot within economics departments just a few decades
ago, behavioural economics has gained an established place not only
within academia, but also within government departments around the
world. From Australia to America, as well as within organisations like
the World Bank and UN, the “nudging” approach has been copied. The Nobel
Committee’s decision to honour Mr Thaler is of course a recognition of
his personal achievements. But it is also a testament to the newfound
importance of his discipline." The New York Times has a nice collection of some of Thaler's columns, which I recommend.
Dear reader, if I don't convince you, please read Will Hutton today in The Observer. And by the way, he doesn't need to finish his article with a call for another referendum (a typical concession to secessionism by lazy commentators). He knows better than that, because he interviewed Amartya Sen about it. It is the best article about Catalonia that I have seen, perhaps together with the one by Roger Cohen of the New York Times, "Damage to Catalonia." This is what Hutton, probably the best progressive writer in the UK, has to say:
"Europe is plunging ever deeper into an orgy of unforgiving remembrance. A collective curse has settled over our continent, in which past triumphs are contrasted with present grievances. Only independence, taking back control and avenging a continuum of injustice can restore justice, prosperity and lost glory, even if, in Catalonia, there could be a slide to civil war, as EU commissioner Günther Oettinger warns. It is not that the rest of the world is immune from this contagion: witness the passions over the Confederate flag in Charlottesville, Japanese politicians genuflecting at their war shrine or jihadists avenging the Crusades. But Europe, with so many tribes boasting so much history in so many countries, is the memory capital of the globe, where too many states are so vulnerable to the agonies of secession and fragmentation.
The best justification for what is happening is that these inflated memories are but froth on a deeper and natural yearning of every subnational, culturally united minority to enjoy civic self-determination. The worst interpretation is to see Catalonia as an expression of a destructive populist appeal to its citizens’ worst instincts – puffed-up hatred of the other, driven by false grievances and impossible hopes – while cloaking those unappetising instincts in the language of self-government and democracy.
The right response, as Catalonia’s Socialist party argues, is for Spain to recreate itself as a republican, federal state rather than attempt to sustain itself as a monarchially legitimised unitary state. The only way to avoid disaster and give the mainstream parties in Catalonia the political ammunition to argue against secession, which neither they nor the majority of Catalans want, is to offer the prospect of an autonomous Catalonia within a federal Spain. It is through political creativity that historical myth can be relegated to where it belongs, along with much more determined and imaginative activism to address inequalities and neglect.
Similarly in Britain. If the unfolding disaster of Brexit is to be stopped in its tracks, and the over-remembered, over-deified past restored to its proper place, we need parallel creativity – a constitutional settlement with Europe and, at home, a real assault on the injustices that fed what was at bottom a protest vote against a status quo too many found intolerable. Too much remembering has become toxic. It is time to forget and move on."
Colin Kaepernick is an American football player that put at risk his
professional career to express his solidarity with African Americans who
had been victims of police brutality. He lost his contract and he had
to endure the hate of radical nationalists, including the current
president of the USA, Donald Trump. Some recent comments by the
first authority of the country have pushed other American football
players to join the protest. According to Wikipedia "Before a preseason
game in 2016, Kaepernick sat down, as opposed to the tradition of
standing, during the playing of "The Star-Spangled Banner".
During a post-game interview, he explained his position stating, "I am
not going to stand up to show pride in a flag for a country that oppresses black people
and people of color. To me, this is bigger than football and it would
be selfish on my part to look the other way. There are bodies in the
street and people getting paid leave and getting away with murder",
referencing a series of events that led to the Black Lives Matter
movement and adding that he would continue to protest until he feels
like "[the American flag] represents what it's supposed to represent".
In the 49ers' final 2016 preseason game on September 1, 2016,
Kaepernick opted to kneel during the U.S. national anthem rather than
sit as he did in their previous games. He explained his decision to
switch was an attempt to show more respect to former and current U.S.
military members while still protesting during the anthem after having a conversation with former NFL player and U.S. military veteran Nate Boyer. After the September 2016 police shootings of Terence Crutcher and Keith Lamont Scott,Kaepernick commented publicly on the shootings saying, "this is a perfect example of what this is about."
explains how much he cares about the victims of police brutality in the
US, in some cases killed by the actions of abusive agents. I discussed
recently with my students at the Study Abroad program at UAB the
parallelisms between American football players taking a political
position and some sports stars in Catalonia also taking a position in the independence debate, like soccer player Gerard Piqué or manager Pep
Guardiola. Last Sunday Piqué echoed Kaepernick by complaining about the
brutality of Spanish police in trying to prevent some voters from
participating in an illegal referendum
called by the Catalan regional government. There is little doubt that
the Spanish police used excess brutality, but only one person suffered a
major injury (a rubber bullet in the eye). I do not need to hide that I
have much more sympathy for the cause of Mr. Kaepernick than for the cause of Mr. Piqué,
which is also the cause of many upper and middle class people of the
community where I live, but very far away from the sympathies of most
poor and working class citizens. It is nice that Piqué, a
multimillionaire descendant of a family of the Catalan bourgeoisie (his
grandfather sat in FC Barcelona's board of directors) now for the first
time cares about police brutality. Some years ago a Catalan woman lost
an eye because of a rubber bullet of the Catalan police and he didn't
say anything as far as I can remember. Piqué has never been seen
expressing his solidarity with poor people for the dramatic budget cuts
of the recent years (decided both by Catalan and Spanish governments),
nor for the loss of money for the welfare state derived from the tax
fraud of several of his colleagues and team mates. So far, he has not
put at risk his career at all (like his colleague Arda Turan, who supported Erdogan in his last referendum to introduce autocratic elements in Turkey), nor he has started any controversy with
the officials at his club. He is in the celebrity market, his partner is
the Colombian singer Shakira, and he is most probably benefiting from
his increased celebrity as a result of the controversy. Although he says
he would understand that the Spanish national team stops calling him,
he has not taken the step of refusing to go when called by the national
coach, as the 2018 World Cup in Russia is approaching. I am sure that
Vladimir Putin will welcome him with open arms.
FC Barcelona and R. Madrid (both) should leave the Spanish soccer League and join the English Premier League, perhaps at the beginning at least together with Glasgow Rangers and Celtic Glasgow. This would be the embryo of a true European superleague, which would exponentially increase the number of interesting soccer games every week. Now we have to endure many boring games in the Spanish league, which could recover some degree of competitive balance in the absence of the two big clubs. Now soccer leagues compete for attention, for managers and for players. Why couldn't they compete also for teams? Most of the audiences, and most of the best players and the best managers, find the EPL the best league. At the same time, there is an untapped demand for better games. Soccer fans have to wait until the end of the season to watch truly big games in Europe, or wait until the finals of the World Cup every four years. This move would contribute to preventing a hard Brexit, by highlighting the benefits of the UK remaining in the single market. It would cause no great problem to the Spanish or European economy because we would still enjoy two "Clásicos" every season. The Spanish Cup and the Champions League would remain in their current format. National teams would survive, but hopefully would be like tourist attractions deprived of political significance (more or less like the "calcio storico" in Florence and Siena). Instead, political secession to create or consolidate even more nation-states (with their package of flag, anthem and radical nationalism) creates instability and endangers investments and prosperity, as it is apparent in the case of Brexit. The poor would suffer the most with more political secessionism, because they don't have tax havens to send anything. A world of small nations competing for capital thereatens the welfare state. A world of soccer leagues competing for teams in a united Europe doesn't threaten anything and may be great for consumer welfare.
French President Emmannuel Macron gave an important speech on September 26th at Sorbonne University. He proposed to refound the European Project on the basis of a more sovereign Euro-zone, with a stronger budget, a finance minister and a parliamentary control. His project includes some important key aspects in the form of much stronger common policies:
-A common Security and Defence policy that puts together information and resources to fight terrorism.
-A common Foreign policy and development, especially in the Mediterranean and Africa, to better deal with immigration in a human and forward looking way.
-A common policy of ecologic transition, to protect the environment and promote a common and integrated energy system.
-The digital revolution will require a common approach to regulate the digital economy, to protect intellectual property and to train workers in the skills of new technologies and artificial intelligence.
-The European Union and the euro-zone should commit to joint industrial and economic development and to fighting umployment, especially among the youth, in a context of fiscal and social harmonization.
My only problem with the speech is that somehow paradoxically with the objective of an integrated an multilingual Europe, it has been very difficult to me (in fact, so far impossible) to find the English version.
The speech gives more emphasis to objectives than to instruments. But he proposes at least one instrument to achieve this higher integration: the creation of pan-European lists in the next European election, starting with the seats that the UK abandons, but expanding the number of pan-European seats in the next two European Parliament election.
Macron condemns all forms of nationalism and hate, and expresses clearly his ambition to fight them with concrete and strong proposals to accelerate the transfer of sovereignty of all member states to the European level.
The Study Abroad programme at my university, in which I teach a course on soccer and economics to foreign students, has sent this wise message to our overseas partners:
I am writing to you to keep you informed and to respond to enquiries we have received about the situation in Catalonia.
As you will have seen in the news
there is a political dispute between the Spanish and Catalan governments
and there has been a lot of activity, meetings and demonstrations.
These have developed in a peaceful way and while
there is debate and discussion there is no reason to fear violence.
The UAB officially inaugurated the course yesterday (news
ítem here) and the Study Abroad programme is running as normal. We
have reminded the students to be aware and make sure they are safe when
they are out and about in the city.
We are also encouraging students
and staff to talk about events to understand and learn from this aspect
of their Study Abroad experience. These are interesting times!
We will keep you informed. Please do not hesitate to contact us if you have any questions.
I will do my best to encourage my students to talk about events and learn from these interesting times. I am very open to talk about everything related to what is happening in Catalonia in my classes and out of them. Since my course is about soccer and economics in a very general sense, there are actually some specific questions that I would like to discuss with my students: -FC Barcelona officially promotes the idea that it is "more than a club" because the club has been linked to Catalan nationalism. Is the club in favor of Catalan independence? -There is some debate about the league in which Barça would play in case of independence. However, Barça officials say they would play in the Spanish league anyway. Does that make sense? -The Brexit referendum also raised some controversies about the English Premier League and the future of the UK, to which the economist Stefan Szymanski contributed with a blog post? Are there any lessons for Catalonia from the Brexit debate and experience? -A few Catalan players and managers (Piqué, Guardiola) have expressed their opinions in the Catalan independence debate. These days some sports players in the US are also expressing their political opinions. Are there any similarities? What should be the behavior of sports stars in the political debate?
Economist Ray Fisman and political scientist Miriam Golden have written a very useful book that summarizes a lot of recent research on corruption. It is one of those books that is meant for a general readership, but that ends up mostly being read by other academics because it gives a very efficient overview of recent frontier research. It touches on many angles of research on corruption. There are probably three main ideas. First, corruption is a coordination problem: one doesn't stop contributing to it unless others do the same. Second, in this coordination problem, common knowledge plays a very important role. This is probably the strongest part of the book, with very interesting examples on how not only actions that speak against corruption are important, but it is also important that information and participation become well known by many people. And third, there are no panaceas to fight corruption, although there are examples of societies leaving corruption behind, or at least some forms of corruption. Unfortunately, the book was written before Donald Trump becoming the US president. Seeing Trump every day on TV it would have been difficult to mostly forget, as the authors do in my view, about vertically integrated corruption, that is, moguls buying a political party or a political system to benefit from it. There were previous examples, either ignored or minimized in the book, like Piñera in Chile or Berlusconi in Italy, but now the problem also affects the first economy in the world. Although there are many examples in the book, one misses a more qualified approach to some cases of success, such as Chile or Sweden. The Latin American country has experienced recently important corruption scandals, addressed by a commission chaired by an economist, Eduardo Engel. Now the favourite candidate to win the next presidential election is again Piñera, one of the wealthiest capitalists of the country with interests in several regulated industries. Sweden escaped corruption, but it wasn't easy, as explained by Rothstein and Teorell. In my modest opinion, some dichotomies are a bit exaggerated in the book, like the big bang or nothing idea. Clearly, Sweden or the US cities escaped corruption after some decades of trial and error. As the authors say, there are no panaceas, and there have been many failed reforms. Then there is no way forward without learning from past experiences and try again. In multi-level democracies with checks and balances, in addition, centralized big bangs are just impossible. It is also in my view a false dichotomy as the authors seem to implicitly suggest at the end that we should go either for great leaders or bottom up efforts. Surely elites and organizations can do a lot to reform. Most people who get involved in political parties and other organizations are honest and well-meaning. I missed making a little bit more the connection between powerful transnational corporations and the concentration of fortune and corruption, and in general the connection between inequality and corruption. Sometimes in the book the idea is given that it is politicians who have most of the bargaining power. FIFA, Putin's olygarchs, corruption scandals in public-private partnerships and other examples show that the public-private frontier is fuzzy at best in corruption. Transnational implications of corruption are very relevant. Something is said on the importance of external pressure and coordinated international efforts, but the enormity of the problem is perhaps not exposed. In spite of all these comments, it is a great book that I recommend. Perhaps it should be read together with the book by Putterman on why humans CAN be angels, under the right environment of course. Democratic quality is a public good, and sometimes humans manage to provide public goods. The book finishes with a list of suggestions on what ordinary people can do. The list is taken from Transparency International. I fully support these suggestions. I would add two: if you are an angel, become a politician, and if you know any other angel, convince her or him to become a politician, or to get involved and active in politics.
Yesterday I attended the thesis defence of a student I have supervised. The dissertation is a collection of empirical essays in political economy that I hope will make their way to the publication circuits in the near future. One of the chapters was about how the memories of economic management in previous military regimes affected the support for democracy in Latin America. The main finding is that this benchmark does significantly affect perceptions of democracy, showing that reference points are important in political preferences, as we know from behavioral economics that they are in other fields. Another apparently very different chapter was about how the Catalan public TV channel had affected preferences for nationalism in the voting population. This influence is difficult to identify, as causality may go in different directions and there may not be enough variation to find statistical significance. However, by exploiting the fact that some territories started the channel before others probably for exogenous reasons, the author found that this channel, in the early periods (the only ones that can be analyzed using this technique) had an effect on preferences that was double in size than the effect in other similar studies. Finally, the third chapter was an event study about how the Catalan secession campaign of the last years had affected the stock returns of firms with interests in the region. In this case, the effects are very small and non-significant. I found very interesting that one of the very thorough members of the evaluation committee thought that the three studies were related because all of them analyzed preference formation following autocratic regimes. It was humbling to realize that many things that happen in Catalonia and Spain are the result of a country that just experienced a 40 year military dictatorship that finished just 40 years ago. Many of those who lived under that regime, in favour and against it, are still with us. The dark shadow of the Franco period still influences us in many ways, not always in the expected direction.
In Spain, Catalan nationalists are teeming up with a part of the radical left to take advantage of a weak an unpopular government to organize an illegal and revolutionary self-determination referendum. To hold a self-determination referendum is a legitimate proposal, but those who endorse it should do so with a minimum of rigour and some arguments that weigh the difficulties and contradictions of the proposal in XXI Century Europe. Of course, the weak and unpopular government of Mr. Rajoy in Madrid is not only a problem for the Catalans, but also for all the Spaniards. A secession campaign accompanied by the typical nationalist ingredients of hate, intolerance and demagoguery, will do nothing to improve democracy or democratic quality. The campaign is being suported by Julian Assange and congressman Dana Rohrabacher from the US, an ally of Trump and Putin. Watching yesterday an interview with Steve Bannon (former alt-right and ultra-nationalist advisor of Donald Trump) in Bloomberg TV, I see that the convergence of interests between nationalists and a part of the radical left does not only happen here. Some aspects of their tactics and their style of doing things is also similar in Europe and the US. Now in Europe we are more relaxed about national-populism after the defeat of Marine Le Pen against Macron, but we should not be relaxed about the dangers ahead. In that interview, Bannon predicted (as if wishing it) that the future will be a battle between left-wing populism and right-wing populism, and that the Americans will become united behind economic nationalism. Paul Krugman recently predicted that with the fall of Bannon in the White House, Trump would abandon economic nationalism and just spouse a traditional conservative agenda. Bannon predicts the opposite.
John Cassidy explains in The New Yorker the details of the CORE project to teach introductory economics at the undergraduate level in a way that responds to the critics without pandering to them. That is, the economists of this project have listened carefully to critical students that raised their voices especially after the last global financial crisis, and accordingly they have developed a new method and new materials to teach economics in a reformed but rigorous way. The new materials promise to be much better than the traditional textbooks. For example, in my introduction to economics for sociologists I use the book by Krugman, Wells and Graddy. Although its last edition covers the global financial crisis, some of the topics in the rest of the book (e.g., minimum wages) are covered in a way that is contradicted by what Krugman himself says in his blog. According to Cassidy, "The CORE approach isn’t particularly radical. (Students looking for
expositions of Marxian economics or Modern Monetary Theory will have to
look elsewhere.) But it treats perfectly competitive markets as special
cases rather than the norm, trying to incorporate from the very beginning the progress
economists have made during the past forty years or so in analyzing more
complex situations: when firms have some monopoly power; people aren’t
fully rational; a lot of key information is privately held; and the gains
generated by trade, innovation, and finance are distributed very
unevenly. The CORE curriculum also takes economic history seriously." Samuel Bowles and Wendy Carlin, two of the promoters of the project, explain in Vox that the new method (which can be downloaded for free) introduces politics and empirical evidence in a much more substantial way than traditional materials. Good work, economists everywhere should use it.
Animals also vote. Not exactly like us, but they also make collective decisions. A study about wild dogs shows that they use sneezes (or something similar) to cast their votes. An interesting part of the study is that the percentage of votes needed to make a decision is variable. They use variable quorum thresholds. In particular, the thresholds change with the status of the "agenda-setter." It may also depend on other variables, but human scientists are happy enough for the time being on what they have discovered. It is as if wild dogs had their own Venice Commission, that is, the Council of Europe's Commission for Democracy through Law, which prescribes the conditions under which referendums should take place. In the particular case of self-determination referendums to create new countries from existing ones, the conditions are very strong. That is, it is more difficult to change borders, especially in democratic countries, than to decide where to go for dinner. This is often forgotten by some superficial commentators, who recommend this kind of referendums usually for countries that are not their own. The USA, Germany, Italy, France, and all major democracies either prohibit or do not contemplate such referendums in their constitutions. Only four countries in the world include such possibility in their written Constitution (Ethiopia, Uzbekistan, Saint Kitts and Nevis and Liechstenstein). In some cases, of course you can reform the Constitution, but reforming it is difficult. This is probably for good reasons, to avoid lies, divisions and instability, as the British now know from the Brexit experience. Some referendums are necessary and good, but they must take place under very strict conditions. The distinction between good and bad referendums is crucial. Franco and Hitler did organize referendums. Orban, Le Pen, Wilders, and Putin have also used or tried to use referendums. Being rigorous about the defence of such instrument is as important as the distinction between democracy and autocracy. Wild dogs have very careful rules, not everything goes. They do not have a written document like the code of good practices of the Venice Commission. We humans have such a document, but many people refuse to know about it.
September is the season of marches and pseudo-referendums in our land, and this year is no exception. A narrow majority in the Catalan autonomous Parliament tries to impose a new illiberal democracy that will be stopped by the Constitutional institutions of Spain with the support of the European Union. Catalonia has an average income that is above the average income of the EU citizens. Its original language is official and the one used as a priority in the school system. The police, prisons, universities, hospitals, are run by the regional government. Nevertheless, a successful campaign by the Spanish Popular Party, now ruling in Spain, in 2010, to put pressure on the Constitutional Court to reject parts of a new Statute of Autonomy, triggered a campaign for Independence that has been used by the conservative nationalists in Catalonia, under pressure from their own corruption scandals and austerity policies, to start a scalation of commitments to something that is ultimately impossible: a unilateral and peaceful process of Independence that disconnects Catalonia from Spain but not from the European Union. The Catalan society is deeply divided and examples of intolerance and the mob rule (so fare, limited to the social networks) now abound. We can afford it as long as tourists keep visiting us and our economy remains healthy, but we are giving a very sad example of fanatic nationalism and illiberal democracy. The narrow majority in the Catalan government (with the necessary support of a radical euro-phobic group) tries to impose a procedure to vote in a referendum excluding half of the citizenry from the decision about the question, the date, the legal framework, the electoral authority, etc., of the pseudo-referendum. Those who oppose it need more than reasons, we need emotions and narratives. We keep working on it, for example reading today Jonathan Freedland in The Guardian (the answer is Europe, not making the mistake that Spanish Prime Minister Mariano Rajoy is about to make, of visiting Donald Trump days before the pseudo-referendum): "In a talk on Thursday night, Le Carré spoke of the behaviour of Donald Trump and others as “absolutely comparable” to the rise of fascism in the 1930s. “It’s contagious, it’s infectious. Fascism is up and running in Poland and Hungary. There’s an encouragement about,” he said.
This is a warning to take seriously. Hungary is indeed led by a man who boasts that he is building an “illiberal state”, while Poland’s government is trampling over fundamental democratic protections, including an independent judiciary and freedom of the press (and Trump is cheering them on as they do so).
The US president is not making America great again, but he is making the 1930s current again. Perhaps, then, and in a way he would not want, Trump is providing the anti-Brexiteers with the one thing they always lacked: an emotional heart to their argument. Trump and the fascist contagion is reminding us why the EU exists: to ensure that the neighbourhood we live in is never again consumed by the flames of tyranny and hatred.
On that fateful day in June 2016, it’s possible that some of those who voted leave did so because they believed that democracy and peace were now safe and secure in Europe. In the short time that has passed since, we have seen that those things are, in fact, fragile. As the head of Nato warns that the world is at its most dangerous point in a generation, Britain’s duty, to use a word that might make Smiley wince, is surely to defend the body that helped lead Europe out of its darkness."
As it has been happening since 2012, September is the month of nationalist demonstrations and political dramas in Catalonia. This year, another expected season of choreographed marches and a third so-called "referendum" (again, and for the third time since 2014, promoted as a decisive "vote of your life") between September 11th and October 1st will try to show to the world that the Catalan society is unanimously behind the idea of secession from Spain. A well funded and hypermobilized strong minority of citizens mostly from the upper-middle classes, will also try to show support for the idea that only a unilateral self-determination referendum without a legal framework, where the question and the date are unilaterally decided, without a neutral authority, that only this mechanism can be chosen to change the status quo of Catalonia in Spain. However, the truth is that the Catalan society is very diverse and plural, and that there are many other voices. Among these voices, one of the best organized and the one with the most constructive proposal is the Federalist Movement, represented by Federalistes d'Esquerres, a platform that was born in 2013 to reivindicate the rich federalist tradition of the Catalan and Spanish left. It has organized many debates and events in Catalonia since then, and it has participated in federalist marches and public meetings in several Spanish regions, as well as in Brussels and in Rome. Among its more tan 3000 members and sympathisers, there are citizens from several political parties and trade unions. Its first president was the current member of the Spanish Parliament, the philosopher Manuel Cruz, and its current president is the Dean of the School of Political Science at the Autonomous University of Barcelona, Joan Botella. Their members include the former Anti-Corruption public prosecutor of Spain, Carlos Jiménez Villarejo, and the prestigious writer and professor of Ethics Victoria Camps. This group has been gathering strength since its birth despite the lack of institutional and public support, and it has a very active agenda of events. It is also promoting a crowd-funding campaign for the production of the documentary "Federal", directed by award-winning film director Albert Solé. This documentary is now in the last stages of production, and will be the focus of a strong campaign in 2018.
This movement defends the following ideas and positions:
1. Strong nationalisms reinforce each other: the Catalan question is now the excuse of Spanish and Catalan elites to avoid introducing in-depth reforms in our democracy that make it more transparent and egalitarian. In particular, it is an excuse that obfuscates and creates the division that prevents tackling the very serious corruption scandals that have affected the Popular Party in Spain and the party of the Catalan President (formerly CDC and now PdECat).
2. The nation-state is obsolete. In the XXIst century none of our greatest problems can be solved with the old tool of the nation-state. Climate change, fiscal fraud, migrations and refugee waves, terrorism, financial instability... all of our greatest problems require transfers of sovereignty and coordination at a large scale, which can only be achieved through a European and global process of federalization.
3.Spain and Europe need reforms. Although Spain is a very decentralized country that belongs to the EU and the Euro-zone, there are legitimate demands of cultural recognition and about financial arrangements from Catalonia and there are serious shared institutional problems. A federalist reform is not only supported by a large part of Catalan citizens, but it also has strong allies in the rest of Spain and would have the obvious sympathy of European political leaders and governments of member states. Instead, Catalan secessionists have dramatically failed in their quest for international, and specially European, support. The federalist reform should include Constitutional reforms in Spain to transform the Senate into a territorial chamber (similar to Germany), to introduce a multi-lingual system at all levels (similar to Canada and Switzerland), to establish a more transparent system of territorial transfers and investments, and to clarify the responsibilities of each level of administration following the subsidiarity principle. Instead of fighting for the obsolete concept of territorial sovereignty, we should all accept that we live naturally in a multi-level democracy where the identification of one state with one nation, one flag, one currency, one language and one army has disappeared.
4. Behind the façade of a peaceful movement, Catalonia has seen disturbing episodes of intolerance, such as virtual mob attacks in the social networks (sometimes supported by Catalan government's press conferences) addressed to journalists, intellectuals, artists and others who have dared to raise their voice or even to express doubts about the secessionist process. The legal plans of the pro-independence leader and the majority in the Catalan Parliament (a narrow majority that does not represent a majority of votes, because of an electoral system that privileges rural areas) include attacks to the division of powers and checks and balances. In particular, in a transitional period, they expect the judicial power to be subject to the executive branch, in a mechanism that has been compared by experts to the one for which Poland has received a serious warning by the EU institutions. The narrow parliamentarian majority of the pro-secession groups is achieved because of the support of an extremist euro-phobic group, the CUP, whose youth wing has promoted violent attacks to tourists and also acts of bullying against political dissenters.
5. Self-determination referendums are not allowed in the immense majority of democratic constitutions in the world. The international consensus is that they should only take place in exceptional circumstances, and if they take place, they should be subject to very strict conditions, established by the Commission of Democracy through Law (the Venice Commission) of the Council of Europe. The unilateral referendum promoted by the Catalan government fulfils none of these conditions.
6. The Independence delusion in Catalonia is similar to the Brexit delusion in the UK. It is accompanied by exagerations and lies that are sold as facts, especially relative to the economic and financial gains, the attribution of all problems to an external enemy and the illusion that Independence is easy, inexpensive and requires no agreement with anyone. The rhetoric is also similar, and similar to other national-populist movements that have attracted voters recently in ther parts of the world: "the will of the people, freedom, democracy, sovereignty..."
7. The pro-secession movement and its political use by the Catalan government has created a deep social division in Catalonia, in what had been an example of a diverse and tolerant society. The last example of the attempts to dig deeper into this internal division, and the sometimes artificial division between a falsely homogeneous Catalonia and the rest of the Spanish society was the manipulation of the social reaction to the terrorist attacks of August 17th in Barcelona and Cambrils, as explained by Roberto Toscano in La Repubblica. Instead, the federalist movement emphasizes the many links of Catalans with Spaniards: we share families, history, problems, businesses, sports idols and competitions. And most of us thank the immense solidarity of many Spaniards after the terrorist attacks and want to share our links more broadly now in a united and more democratic Europe.