*** PHILIPPE BANCE, LUC BERNIER: Contemporary Crisis and Renewal of Public Action/Crise contemporaine et renouveau de l'action publique. Towards the Emergence of a New Form of Regulation? / Vers l'émergence d'un nouveau mode de régulation? Presses Interuniversitaires Européennes/Peter Lang (1 av. Maurice, B-1050 Brussels. Tel: (41-32) 3761717 - Fax: 3761727 - email: info@peterlang.com - Internet: http://www.peterlang.com ). "Social Economy & Public Economy" series, No. 3. 2011, 333 pp, €37-50. ISBN 978-90-5201-741-9.
The crisis that kicked off in 2007 and is experiencing a disquieting resurgence at present has seen the return of public authorities to centre stage. As the editors of this book explain at the beginning of the introduction, through speedy intervention by a number of countries, it was possible to "avoid the worst" at first, "but often at the price of getting massively in debt, which now affects credibility and the ability to take public action." Unfortunately, Europeans are "ideally" situated to confirm the veracity of this diagnosis by a scientific working group set up in June 2009 at the Centre of Research and Information on the Public, Social and Cooperative Economy (CIRIEC), which mobilised a team of researchers to analyse the necessary return of public intervention and consider possible ways for States to adjust to it. The research reported upon in the book fits perfectly with the hot topic of the moment.
The authors kick off by considering plausible exit strategies and find four. First the holy cow of the time of triumphant pensée unique, "rectification solely via market forces" which, faced with "the risk of meltdown caused by the financial crisis," was ruled out in 2008, countries believing it was essential to invest vast sums of money "to prevent worse economic meltdown than in 1929". Philippe Bance of Rouen University and Luc Bernier, professor at the Ecole Nationale d'Administration Publique in France and chair of the CIRCE International Scientific Council, point out, "countries' financial problems that have since emerged with rising deficits and public debt, the intrinsic weaknesses of some countries and mass speculation very soon demonstrated the intrinsic limits of state intervention to solve financial problems." What a wonderful description of the current situation in Europe! The problem is that this situation could pave the way for the second scenario, namely "nations or regions turning in on themselves," which this is in fact highly likely, and could lead to a "gradual or rapid dismantling of the European economic project," with Member States going back on commitments they have made to the European Union, "as they try to solve the economic imbalances and social tensions arising from the crisis." One wonders whether those calling for a return of power to the nation state and for the dismantling of the European Union realise that they are expressing "the resurgence of rising tension between nations or even, as in the 1930s, of the world falling apart." Probably not, but it is time for them to be starkly reminded of it. For the moment, at least, most leaders encourage "the scenario of a transitional adjustment of public action" in the form of active budget and fiscal policies, nationalising banks, recapitalisation, regulating stock options and bonuses, new prudential rules and financial transparency, all of which is being used at the moment to alleviate the impact of the crisis and encourage a return to growth. The problem is that these temporary measures do nothing to alter the "pernicious practices" that generate "the perpetuation of highly pronounced economic cycles or even a return of the risk of system collapse." In order bring about change, the scenario of "metamorphosis of global public regulation" must be brought about, in other words, "close coordination of economic policies at supranational level to promote constant growth and a more balanced sharing of wealth (North-South, Capital-Labour, etc)." Is the time now ripe for a "new order that not only rectifies the current economic and social imbalances but also aims to ensure sustainable development," the protection of "global public goods" and "the provision of services of general interest"? Far from certain although, as Philippe Bance and Luc Bernier point out, it is clear that the favourite scenario at the moment, transitional adjustment, is bound to continue, "the deterioration of public accounts and States' regulatory capacity, the collapse in trust of economic operators and the accentuation of social tensions" being likely to cause problems.
It is against this backdrop that the prospects of renewal of State action are examined, both globally and in terms of countries in the North (Europe and North America) and South (Africa and Latin America). By casting a spotlight on one area after another, public policy instruments are examined which have been or could be used by States throughout the world amidst the current crisis. In the first section of the book, the author examines systemic changes and the structural determinants of public policies at global level. The second section looks more specifically at direct intervention by public authorities at the start of the crisis (nationalisation, budget intervention and the like) and the resulting prospects. The third section looks at public services in the crisis, examining the potential repercussions in terms of their management and governance. The final section looks at institutions capable of bringing about sustainable development and instruments that can be used to promote it. From start to finish, this is an enlightening book that should be read by any politician worthy of the name.
Michel Theys
*** WOLF KLINZ, PERVENCHE BERES (Eds.): Special Committee on the Financial, Economic and Social Crisis. Documentation relating to the Committee's work from October 2009 to July 2011. European Parliament (Brussels). 2011, 324 pp + Annexes and CD.
Faced with the sheer scale of the crisis that broke out in 2008 after the collapse of the bank Lehman Brothers, the European Parliament decided on 7 October 2009 to set up a special committee on the financial, economic and social crisis, chaired by German liberal democrat Wolf Klinz, with French socialist Pervenche Berès as rapporteur. Until July 2010, the committee studied the crisis in great detail, examining its causes, its impact across the Member States and the state of global governance. In accordance with its remit, the committee organised hearings, workshops and fact-finding trips to various countries, and published various reports in order to help formulate recommendations and measures to restructure the financial markets ensure stability and healthy functioning in the service of sustainable growth, social cohesion and a sufficient scale of job creation. All these subjects and documents are found in this publication and the accompanying CD-ROM. Summing up, the special committee says that the European Union must become more integrated because the crisis has exposed the limits of intergovernmentalism. (PBo)
*** Robert Triffin, conseiller des princes. Souvenirs et documents. Presses Interuniversitaires Européennes/Peter Lang (see above). "Relations financières internationales" series, No. 4. 2010, 148 pp, €26-50. ISBN 978-90-5201-642-9.
Born in Belgium in 1911, Robert Triffin would become a citizen of the United States before reverting to Belgian nationality shortly before his death in 1993. This unusually designed and varied book is, as Alexandre Lamfalussy (former president of the Bank of International Settlements and the European Monetary Institute, which was the forerunner of the European Central Bank) and historian Michel Dumoulin of the 'Université Catholique de Louvain' explain in the preface, "a contribution to the discovery of a personality, philosophy and action that still fashion the history of our times." It certainly is a "discovery" because what young person today knows anything about this "activist-economist fighting for the creation of a European currency," this "deeply pacifist and federalist" man who played such a big role in the creation of the European Payments Union and the European Monetary System? In 1989, he agreed to dictate his memories to two journalists who were then part of the editorial team on Belgium's "Le Soir" newspaper, Catherine Ferrant and Jean Sloover, and it is some of this account that is published in the book, along with documents illustrating the work of this "advisor to the royals." The original interviews are enriched with explanatory notes by Prof. Dumoulin, which help bring alive the people and events and shake off the dust of decades. (MT)
*** MICHEL HERBILLON, JEROME LAMBERT, CHRISTOPHE CARESCHE, BERNARD DEFLESSELLES, ROBERT LECOU: L'Union européenne et le G20: répondre aux enjeux de la régulation mondiale. Commission des Affaires européennes de l'Assemblée nationale (Boutique de l'Assemblée nationale, 7 rue Aristide Briand, F-75007 Paris. Tel: (33-1) 40630033 - Internet: http://www.assemblee-nationale.fr ). "Rapports d'information" series, No. 3443. 2011, 25 pp, €3-50.
ISBN 978-2-11-132391-9.
France has been chairing the G20 since 12 November 2010 and the French parliament's European Affairs Committee has invited a number of parliamentarians to consider regulatory issues at the scale of large global economies ahead of the Cannes Summit on 3 and 4 November 2011. This newsletter publishes the outcome of their work, focussing on three main subjects: financial markets, monetary balance and commodity prices. They also address G20 governance and put forward the hypothesis that a permanent secretariat should be set up. They detail ways that the European Union's role could be improved. There are four Member States on the G20 (Germany, France, the United Kingdom and Italy) along with the European Commission. In the G20's decision-making, they argue that the EU should be seen as the world's leading economic power. (MT)
*** Causeur. Causeur.fr (9 rue Léopold-Robert, F-75014 Paris. email: info@causeur.fr - Internet: http://www.causeur.fr ). September 2011, No. 39, 48 pp, €5-50. Annual subscription: €55.
"Become impoverished!" is the title of the special report in this monthly publication which has such a huge presence on the internet every day. The special report examines the consequences of the current crisis that nobody can see an end to, and the sub-title is just as explicit: "When only debts are sovereign." Luc Rosenzweig explains that Germany will not pay this time round, while other articles criticise the way the markets are so needy for reassurance, while Jérôme Leroy argues that if the rich are made to pay, "it will at least have the advantage of helping them get some sleep," but no more than that. Georges Kaplan makes the customary comment that "protectionism is war," while Elisabeth Lévy says that "the unfair and false competition" that the nations of the European Union "accepted as the iron law of wages has enriched the haves around the world and gobbled up the have-nots, before attacking the middle classes." She joins Jean-Pierre Chevènement in pointing out that "the crisis is more political than economic or financial," going on to dream without many illusions of a "G20 characterised by voluntarism, after which the governments will decide to take the necessary measures collectively and reclaim their authority." There is an interview with economist Jean-Luc Gréau, who says that "the Golden Rule is a paper-thin flood-barrier" and the real solution, in his view, requires a "sea-change in the organisation of banks to make the Central Bank the lender to the real economy," this being "the only way to get past the now tangible risk of the credit system the way it operates today suffering a heart attack." He says that either the euro should be reconstituted along with the European Central Bank along these lines, or "the collapse of the euro" should be accepted. The second scenario seems more likely in his opinion because of the way Germany is behaving. He describes the idea of setting up eurobonds as a blind pursuit that European leaders have been indulging in for four years now. (MT)
*** Confrontations Europe (227 bld. Saint-Germain, F-75007 Paris. Tel: (33-1) 43173283 - Fax: 45561886 - email: confrontations@wanadoo.fr - Internet: http://www.confrontations.org ). July-September 2011, No. 95, 48 pp, €7.
In the editorial, Claude Fischer and former MEP Philippe Herzog sketch out economic governance, explaining that the problem these days is "to support and balance the adjustments policies in place with new growth policies." They therefore recommend the preparation of a "New Deal to give attractive substance to the economic ministry and fiscal federalism ideas," stating loud and clear that: "Building new, sustainable growth, including a substantial change to social systems (new welfare), would reunite Europeans by giving them hope." These ideas are set out in a very tangible form in the special report, which sets out an action plan for promoting long-term investment with three dimensions - clarifying the European Union's priorities, creating public interest governance tools and forcing finance to take a long-term view. The problem of long-term investment is, say the editors, is a matter of working with evolution to move towards a "society ov moderation" as suggested by Commissioner Barnier. Meanwhile, Fischer and Herzog pick apart 'reactionary deglobalisation ideas (MT)