Governments sometimes need to restructure their debts. Otherwise, a country’s economic and political stability may be threatened. But, in the absence of an international rule of law for resolving sovereign defaults, the world pays a higher price than it should for such restructurings. The result is a poorly functioning sovereign-debt market, marked by unnecessary strife and costly delays in addressing problems when they arise.
We are reminded of this time and again. In Argentina, the authorities’ battles with a small number of “investors” (so-called vulture funds) jeopardized an entire debt restructuring agreed to – voluntarily – by an overwhelming majority of the country’s creditors. In Greece, most of the “rescue” funds in the temporary “assistance” programs are allocated for payments to existing creditors, while the country is forced into austerity policies that have contributed mightily to a 25% decline in GDP and have left its population worse off. In Ukraine, the potential political ramifications of sovereign-debt distress are enormous.
So the question of how to manage sovereign-debt restructuring – to reduce debt to levels that are sustainable – is more pressing than ever. The current system puts excessive faith in the “virtues” of markets. Disputes are generally resolved not on the basis of rules that ensure fair resolution, but by bargaining among unequals, with the rich and powerful usually imposing their will on others. The resulting outcomes are generally not only inequitable, but also inefficient.
Those who claim that the system works well frame cases like Argentina as exceptions. Most of the time, they claim, the system does a good job. What they mean, of course, is that weak countries usually knuckle under. But at what cost to their citizens? How well do the restructurings work? Has the country been put on a sustainable debt path? Too often, because the defenders of the status quo do not ask these questions, one debt crisis is followed by another.
Greece’s debt restructuring in 2012 is a case in point. The country played according to the “rules” of financial markets and managed to finalize the restructuring rapidly; but the agreement was a bad one and did not help the economy recover. Three years later, Greece is in desperate need of a new restructuring.
Distressed debtors need a fresh start. Excessive penalties lead to negative-sum games, in which the debtor cannot recover and creditors do not benefit from the larger repayment capacity that recovery would entail.
The absence of a rule of law for debt restructuring delays fresh starts and can lead to chaos. That is why no government leaves it to market forces to restructure domestic debts. All have concluded that “contractual remedies” simply do not suffice. Instead, they enact bankruptcy laws to provide the ground rules for creditor-debtor bargaining, thereby promoting efficiency and fairness.
Sovereign-debt restructurings are even more complicated than domestic bankruptcy, plagued as they are by problems of multiple jurisdictions, implicit as well as explicit claimants, and ill-defined assets upon which claimants can draw. That is why we find the claim by some – including the US Treasury – that there is no need for an international rule of law so incredible.
To be sure, it may not be possible to establish a full international bankruptcy code; but a consensus could be reached on many issues. For example, a new framework should include clauses providing for stays of litigation while the restructuring is being carried out, thus limiting the scope for disruptive behavior by vulture funds.
It should also contain provisions for lending into arrears: lenders willing to provide credit to a country going through a restructuring would receive priority treatment. Such lenders would thus have an incentive to provide fresh resources to countries when they need them the most.
There should be agreement, too, that no country can sign away its basic rights. There can be no voluntary renunciation of sovereign immunity, just as no person can sell himself into slavery. There also should be limits on the extent to which one democratic government can bind its successors.
This is particularly important because of the tendency of financial markets to induce short-sighted politicians to loosen today’s budget constraints, or to lend to flagrantly corrupt governments such as the fallen Yanukovych regime in Ukraine, at the expense of future generations. Such a constraint would improve the functioning of sovereign-debt markets by inducing greater due diligence in lending.
A “soft law” framework containing these features, implemented through an oversight commission that acted as a mediator and supervisor of the restructuring process, could resolve some of today’s inefficiencies and inequities. But, if the framework is to be consensual, its implementation should not be based at an institution that is too closely associated with one side of the market or the other.
This means that regulation of sovereign-debt restructuring cannot be based at the International Monetary Fund, which is too closely affiliated with creditors (and is a creditor itself). To minimize the potential for conflicts of interest, the framework could be implemented by the United Nations, a more representative institution that is taking the lead on the matter, or by a new global institution, as already suggested in the 2009 Stiglitz Report on reforming the international monetary and financial system.
The crisis in Europe is just the latest example of the high costs – for creditors and debtors alike – entailed by the absence of an international rule of law for resolving sovereign-debt crises. Such crises will continue to occur. If globalization is to work for all countries, the rules of sovereign lending must change. The modest reforms we propose are the right place to start.
Phil at All That Is Solidreports from the West Midlands hustings yesterday:
It might be a building site, but already New Street Station looks better than the soulless vault it previously was. Something else was also better than preceding iterations. When I trekked down to Birmingham yesterday for the Labour leadership and deputy leadership hustings, my hopes were not high. After all, members and supporters were invited to submit their questions before proceedings began. A manifestation of control-freakery? Actually, no. The range of questions were broad, and so the audience got a much better discussion than I was hoping for. Speaking of the people in the hall, around a thousand turned up to Brum’s New Bingley Hall – much more than previous regional events I’ve attended these last five years. Then again, when you’ve put on 50,000 members since the general election how could it be otherwise?
Sky’s Sophy Ridge moderated proceedings. There was an hour for leader candidates followed by another hour for the would-be deputies (the latter will be covered in a separate post). Each candidate was expected to stick to a strict time limit and at the end of questions gave a concluding stump speech. The questions and answers were …
When CNN International reporter Lucy Pawle stepped out of a store in London’s West End she could not believe what she was seeing. As a dutiful journo, she got out her phone and snapped away then placed a call to her station. Shortly after she was on the air breathlessly reporting her find; a black ISIS flag was on the London Gay Pride Parade! And no one seemed to have noticed!
Not being a mug, not at all, Pawle wondered if it might be that British sense of humour she’d heard so much about as the lettering appeared to be “gobbledygook”.
The CNN anchor then brought on the ‘security expert’ Peter Bergen who pondered why an ISIS flag would be there when the group hurls gays off buildings.
Pawle should have looked closer. No, scratch that, she should have used her brain. No, scratch that, her editor and the anchor and the ‘security expert’ all need eye tests.
The flag is a parody with the ‘lettering’ being images of dildos and other sex toys. I have no idea who made it and what they were trying to say (will update if I find out) but I can guess. I think they were trying to say FU to ISIS.
About an hour after the report went out and Pawle had started to get laughed at on Twitter the video got taken down by CNN, but Mediate have a copy.
Personally I think the flag parody looks hilarious and I guess that those who saw it did too since no one appears to be complaining. But I can see how some might think it disrespectful or something.
What do you think?
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Edit: The artist behind the flag has now been tracked down. The non-anonymous Paul Coombes told PinkNews “the flag of ‘Dildosis’, a conceptual organisation he has set up as a counterpoint to ISIS, established for the advancement of an ecstatic state”.
My good friend Ricky Ricardi, archivist of the Louis Armstrong House Museum in Queens, NYC, commemorates the 65th anniversary of Louis’ recording of ‘La Vie En Rose’ (from Ricky’s blog ‘The Wonderful World Of Louis Armstrong’):
65 Years of “La Vie En Rose”
Louis Armstrong with Sy Oliver’s Orchestra
Recorded June 26, 1950
Track Time 3: 26
Written by Mack David, Edith Piaf and Louiguy (Louis Gugliemi)
Recorded in New York City
Louis Armstrong, trumpet, vocal; Melvin Solomon, Bernie Privin, Paul Webster, trumpet; Morton Bullman, trombone; Hymie Schertzer, Milt Yaner, alto saxophone; Art Drelinger, Bill Holcombe, tenor saxohpne; Earl Hines, piano; Everett Barksdale, guitar; George Duvivier, bass; Johnny Blowers, drums; Sy Oliver, arranger, conductor
Originally released on Decca 37113
Currently available on CD: It’s on “Satchmo Serenades” and about a thousand compilations.
Available on Itunes? Yes.
65 years ago today, Louis Armstrong tapped into his French side by recording two songs he’d perform for the rest of his career: “La Vie En Rose” and “C’est Si Bon.” What follows is a slightly updated version of my original 2010 posting on “La Vie En Rose” and I’ll be back in a few days with a fresh look at “C’est Si Bon.” Enjoy!
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For the last couple of decades, “What a Wonderful World” easily wins the title of the most ubiquitous Louis Armstrong recording, being used in a countless amount of films, television commercials and high school reports (just check YouTube). But “La Vie En Rose” is definitely a close second. According to Imdb.com, it’s been used in at least eight major motion pictures since 1994, most notably in the Pixar classic “Wall-E,” as well as television shows, commercials, you name it. And anyone who has spent three minutes and 26 seconds in its presence can easily understand the phenomenon. You’d have to have the heart of the Tin Man (pre-Oz) to not be moved by it.
Of course, the song truly belongs to Edith Piaf, the legendary French singer who co-wrote it and made it famous to the point where a documentary and a feature film about her life each bear the title “La Vie En Rose.” Piaf apparently wrote the song in 1946 and sat on it for a while before she finally gave it a go in public, where it was received tremendously. In 1948, she sang her original French lyrics on a recording that was picked up in the United States by George Avakian of Columbia Records. I’ll let George tell the story, as he eloquently did in the liner notes to an Armstrong boxed set on the Hip-O label, “An American Original”:
“That same year, Edith Piaf took New York by storm an me by surprise. I was doubling as International and Pop Album director at Columbia in those days, and when Piaf’s manager told me she was coming back to New York despite a cool reception the first time ’round, I asked our Paris affiliate to send me samples of her interim releases so that I could try to choose something which might appeal to the American public. I recognized one melody as ‘You’re Too Dangerous, Cheire,’ a failed pop tune I had liked a couple of years earlier. The label said ‘La Vie En Rose,’ and the impassioned French lyric was far superior to wishy-washy English words I knew. We gave it a shot and to everyone’s astonishment but ‘Ay-deet’s,’ it sold a million copies.”
For those who aren’t familiar with it, hear’s Piaf’s original French version, courtesy of YouTube:
As of today, multiple YouTube versions have amassed over 20 million views, a testament to the lasting power of Piaf and that song in particular. But who is in second place? Ol’ Pops with just over 19 million views himself. As Avakian added, “Of the countless cover versions that followed, Louis’ was easily the best, and he never stopped singing it.” Read the rest of this entry »
Translated: for Marxists.org 2015 by Mitchell Abidor; CopyLeft: Creative Commons (Attribute & ShareAlike) marxists.org 2004. Translator’s note: This 1940 manuscript, which we thank the great Victor Serge scholar Richard Greeman for providing us, and which has never before been published in any language, is an essential text in the Serge canon. It demonstrates his distance from what was left of Bolshevism as well as his critique of the dogmatism of Trotsky and Trotskyism. His admission that the germs of Stalinism can be found in even the Bolshevism of the heroic period is a key element in understanding both the Soviet Union and Serge’s development. Of especial interest, as well, are his nuanced comments about the European social democratic parties, a bugaboo of the revolutionary left but which Serge finds to have played and continue to play a valuable role. The illegible sections of the manuscript, as Greeman has pointed out to me, are testimony to Serge’s poverty: he couldn’t afford new ribbons for his typewriter.
The need for this critique recently struck me while translating Leon Trotsky’s remarkable essay Their Morals and Ours. There are surely no other contemporary documents that better express the soul of Bolshevism, by which I mean, of course, the Bolshevism of its great years and also, as we will see, the Bolshevism of its decadence which, while courageously opposing Stalinism, the doctrine of the Thermidor of the Russian Revolution, nevertheless bears its mark. And there is absolutely no doubt that no one will ever write anything comparable on this subject, for the great Russians of the three revolutions of 1905, 1917, and 1927 are dead, and we know all too well what kind of death that was. Trotsky remains the last representative of a great historical event and of the type which was both its product and its highest achievement. The modern world owes these men a great deal; the future will owe them even more. Which is even more reason not to blindly imitate them and to try to discover to precisely what extent the socialism that is on the march owes them its approval.
One is immediately struck by the tone of Trotsky’s book, though not by what is peculiar to it, that is his incisive and clear style , but rather by the domineering tone of Bolshevik speech of the great years, along with its echoes of the imperious and uncompromising style of Karl Marx the polemicist. And this is something of great importance, for this tone is essentially one of intolerance. With every line, with every word it implies the claim to the monopoly of truth, or to speak more accurately, the sentiment of possessing the truth. That this sentiment is born of an assurance that is often useful in combat is undeniable. But that this assurance is at bottom unjustifiable is also undeniable. The truth is never fixed, it is constantly in the process of becoming and no absolute border sets it apart from error, and the assurance of those Marxists who fail to see this is quickly transformed into smugness. The feeling of possessing the truth goes hand in hand with a certain contempt for man, of the other man, in any case, he who errs and doesn’t know how to think since he is ignorant of the truth and even allows himself to resist it. This sentiment implies a denial of freedom, freedom being, on the intellectual level, the right of others to think differently, the right to be wrong. The germ of an entire totalitarian mentality can be found in this intolerance.
Trotsky confounds under the same rubric and with the same contempt democrats, liberals, idealists, anarchists, socialists, left socialists (the “centrists”), right communists, and even left communists (“Trotskyists”) who offer any objections to what he thinks. Through purely mechanical reasoning he considers that they constitute a united front “against the Fourth International.” The existence of the latter is, however, still only a problem, but even if it were already a reality this way of viewing it would still be surprising because of its disdain for the facts. The anarchist Berneri (and quite a few of his political friends), the Menshevik Rein-Abramovich, the POUM militants Andres Nin, Kurt Landau, Arenillas, Mena and so many others) are dead, along with hundreds of thousands of poor Spanish buggers crushed under the weight of international reaction. Along with Rykov and Bukharin, the right communists in Russia [rest of the sentence illegible]. To say after all this that only the Fourth International “suffers the pressure of international reaction” is truly a bit of swagger. But we can see how this swagger has become possible: however weak it might still be – and this means however far from real political existence it might be – the Fourth International alone is the bearer of revolutionary truth. And so… etc, etc. Read the rest of this entry »
Brian Denny of the nationalist No2EU campaign, claims (MS June 24) that “Cameron is already building an alliance for his strategy which stretches from the CBI to the more unhinged parts of British Trotskyism”
I presume by “the more unhinged parts of British Trotskyism” Mr Denny is referring to people like myself and the Alliance for Workers Liberty, who refuse to endorse his reactionary nationalist anti-EU stance. Would Mr Denny care to provide one single shred of evidence for his claim that we are in an “alliance” with Cameron? If he fails to do so (as he must) I shall expect an apology. And readers may care to consider who, in this debate, is in reality “unhinged”.
Kurdish forces, having linked from east and west to take Tal Abyad and thus cut off the main ISIS supply route to Raqqa (from Turkey), are moving steadily towards the ISIS capital itself. Today they have taken a military base, Brigade 93, outside Ain Issa, which ISIS seized last summer. Reports are of ISIS forces and civilians fleeing to Raqqa itself (which is also the subject of ongoing allied air strikes). Kurdish forces are now only 30 miles from Raqqa. They also have US air support which is of course an advantage in case of ISIS attempts to counter attack on the growing Kurdish front.
The Kurdish campaign in the north of Syria has been the one clear ongoing success in recent months in the fight against ISIS. To think: the heroic Kurds at Kobani were almost written off last October by governments and media alike. Now they are pressing ISIS hard in its own heartland. It’s hard to tell what the outcome will be – even if Raqqa falls, there is still Mosul in Iraq, and ISIS have a habit of taking territory then moving out when under pressure and striking elsewhere. It is not beyond the bounds of possibility that they might try setting up a capital in another country entirely. But in the long term that is not a recipe for maintaining a state, keeping up recruitment or scaring your enemies into giving up without a fight.
Kurdish progress in the past couple of weeks alone has been wonderfully fast. Let us hope it is not a false dawn, and keep our fingers crossed for them and their allies.
Aleksei Mozgovoy – the recently assassinated commander of the Prizrak Batallion, which controls the town on Alchevsk in the so-called ‘Lugansk People’s Republic’ – was killed as a Jewish blood sacrifice.
That’s the claim made by a post on a Facebook page created by the British ‘Solidarity with the Anti-Fascist Resistance in Ukraine’ (SARU) campaign, much of which is given over to RMT member Eddie Dempsey reminiscing about his recent trip to Alchevsk (as he’s also done in the Morning Star):
The post on the SARU Facebook page links to piece on YouTube entitled “Mozgovoy – He Was Eliminated for the Day of the Torah (Shavuot)”, produced by the “Voluntarily United Union of Christian Liberation”.
According to the 45-minute recording on YouTube:
– The killing of Mozgovoy was a “ritual offering” (sic) for the Day of the Torah (which began in the evening of the day on which he was killed).
– Ukraine is run by two Jews (Poroshenko and Deputy Prime Minister Groysman).
– The Russian media are run by the Chabad (a Jewish religious organisation), which explains why they talk about Nazi fascism and Banderite fascism, but never about Jewish fascism.
– A helpline, set up by an organisation called Shalom, for Jews who are victims of anti-semitic acts in Ukraine, is really some kind of undercover organisation set up to ‘punish’ their opponents.
The YouTube recording also emphasises Mozgovoy’s adherence to the Russian Orthodox Church, and concludes with a lengthy reminder of the tenth-century wars between the Khazar Empire and the Christian rulers of Kievan Rus’.
(This is code for: The struggle between the Russian Orthodox Church and Jews is a timeless one.)
The YouTube piece is one of a series produced by Eduard Hodos, Ukraine’s answer to Gilad Atzmon. Hodos was once the head of the reformed Jewish community in Kharkhov, but subsequently converted to Russian Orthodoxy.
According to a favourable review of one of his books from about ten years ago:
“In this sensational series of books entitled The Jewish Syndrome, author Eduard Hodos, himself a Jew (he’s head of the reformed Jewish community in Kharkov, Ukraine), documents his decade-long battle with the “Judeo-Nazis” (in the author’s own words) of the fanatical hasidic sect, Chabad-Lubavitch.
According to Hodos, it’s become the factual “mastermind” of the Putin and Kuchma regimes. Chabad also aims to gain control of the US by installing their man Joseph Lieberman in the White House.
Hodos sees a Jewish hand in all the major catastrophic events of recent history, from the Chernobyl meltdown to the events of September 11, 2001, using excerpts from The Protocols of the Elders of Zion to help explain and illustrate why.
Hodos has also developed a theory of the “Third Khazaria”, according to which extremist Jewish elements like Chabad are attempting to turn Russia into something like the Great Khazar Empire which existed on the Lower Volga from the 7th to the 10th Centuries.
Much of this may sound far-fetched, but as you read and the facts begin to accumulate, you begin to see that Hodos makes sense of what’s happening in Russia and the world perhaps better than anyone writing today.”
Yes, indeed – much of this does sound a trifle far-fetched.
So why has SARU not deleted the post from its Facebook page, even though it has been visible for all to see for the past three weeks, and new material has been added to the page by SARU since then?
Even if SARU were to claim that none of its members speak Russian – something of a shortcoming for such a campaign – this is no answer to the fact that the image in the Facebook post (and the Youtube clip at the top of this post) is a Torah scroll set against the Star of David.
Shouldn’t that have alerted someone? Or did SARU simply not care?
The usually witty host of the US Daily Show, Jon Stewart says “no jokes” in the aftermath of the Charleston killings:
“I have nothing other than sadness that once again we have to peer into the abyss of the depraved violence that we do to each other and the nexus of a just gaping racial wound that will not heal but we pretend doesn’t exist … I’m confident, though, that by acknowledging it, by staring into that and seeing it for what it is, we still won’t do jack shit.”
A powerful and moving statement, well worth watching:
Ebenezer Elliott, iron monger, Radical and Corn Law poet wrote a lament for the enemy of his country, Napoleon Bonaparte. To a later generation it sounded shocking. W H Auden said of it, that it was like finding a poem saying Now Hitler lies dead in Berlin.
When working blackguards come to blows,
And give or take a bloody nose,
Shall juries try such dogs as those,
Now Nap lies at Saint Helena ?
No, let the Great Unpaid decide,
Without appeal, on tame bull’s hide,
Ash-planted well, or fistified,
Since Nap died at Saint Helena.
When Sabbath stills the dizzy mill,
Shall Cutler Tom, or Grinder Bill,
On footpaths wander where they will,
Now Nap lies at Saint Helena ?
No, let them curse, but feel our power;
Dogs! let them spend their idle hour
Where burns the highway’s dusty shower;
For Nap died at Saint Helena.
Huzza! the rascal Whiglings work
For better men than Hare and Burke,
And envy Algerine and Turk,
Since Nap died at Saint Helena.
Then close each path that sweetly climbs
Suburban hills, where village chimes
Remind the rogues of other times,
Ere Nap died at Saint Helena.
We tax their bread, restrict their trade;
To toil for us, their hands were made;
Their doom is seal’d, their prayer is pray’d ;
Nap perish’d at St. Helena.
Dogs! would they toil and fatten too?
They grumble still, as dogs will do:
We conquer’d them at Waterloo;
And Nap lies at Saint Helena.
Elliott was living through the early nineteenth century. Habeas corpus suspended, tough censorship laws, men press ganged for the navy, a cruel penal code, the poor starved by Corn Laws and shut out of enclosed lands. To many it was a tyranny and the French Revolution, and Napoleon, the Revolution’s saviour, meant hope of a transformation. Elliott’s poem is full of scorn and bitter anger at the injustice within the legal and economic system.
Napoleon was much admired by the progressive spirits of his day as an alternative to old rotten regimes. Martin Kettle in The Guardian:-
William Hazlitt, the most ardent of all British radical admirers of Napoleon, called the battle of Waterloo “the greatest and most fatal in its consequences of any that was ever fought in the world”. William Godwin, another of the Waterloo dissidents we should be remembering this week, railed against the “miserable consequences of that accursed field”, and continued throughout his life to believe that, however flawed Napoleon might be, he was still to be preferred to the restored Bourbon kings.
… William Cobbett put it in this way: “The war is over. Social Order is restored; the French are again in the power of the Bourbons; the Revolution is at an end; no change has been effected in England; our Boroughs, and our Church, and Nobility and all have been preserved; our government tells us that we have covered ourselves with glory.”
William Hazlitt and William Cobbett are two of the best writers and the most generous minds that Britain has ever produced.
Kettle says that they may seem like useful idiots and it is reminiscent of how a powerful figure in a foreign land – Lenin, Stalin, Chavez – is picked up as a sign of hope that the old oppressive power can be broken. Sections of the Left fell into despair when the USSR collapsed, as better a false hope than no hope at all.
Napoleon was no Stalin and a reformer in many ways but his scheme for a conquered Britain sounds more like propaganda than actuality. “I would have proclaimed a republic and the abolition of the nobility and the House of Peers, the distribution of the property of such of the latter as opposed me amongst my partisans, liberty, equality and the sovereignty of the people.”
There would have been some liberal measures – emancipation of the Jews for instance – but Napoleon’s habit was to install one of his useless siblings on the thrones of the countries he conquered. During the nineteenth century Britain went its own way to a more liberal and democratic government, out of Old Corruption to cleaner politics and a less jobbing civil service.
So I’m glad that the Emperor of the French got done over by Wellington and Blucher at Waterloo, the battle that Wellington described as “ been a damned nice thing — the nearest run thing you ever saw in your life. “ Blucher had wanted to call Waterloo the Battle of La Belle Alliance but Wellington decided on Waterloo as more easily tripping off the English tongue. I’ve always had a liking for Wellington if only for his laconic pithiness of speech compared to Bonaparte’s bombast and grandiosity.
There’s plenty of French Empire bling in the television series that Andrew Roberts, the military historian and an admirer of Napoleon, is presenting.
He also has a five parter on Radio 4 on the Corsican Usurper and yesterday he was telling us how Napoleon screwed up winning the Battle of Waterloo.
“The history of a battle, is not unlike the history of a ball. Some individuals may recollect all the little events of which the great result is the battle won or lost, but no individual can recollect the order in which, or the exact moment at which, they occurred, which makes all the difference as to their value or importance. .. “ Wellington.
Shiraz Socialist 