I nearly missed this! When the foremost and most honest politician
in Europe speaks it is a disgrace that his words are not taken up
across the media.
Vaclav Klaus is a brave man - mhis recoird proves that - and a
brilliant one.
Read this and be glad he is not spouting weasel words but tells the
truth.
xxxxxxxxxxxxxx cs
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FINANCIAL TIMES 7.1.09
Do not tie the markets - free them
By Vaclav Klaus
It is a common feeling that the Czech Republic is taking over the
European Union presidency at a rather complicated moment, even though
almost all "moments" can eventually be called "complicated". We
should not panic and must say No to people who - by describing the
current moment as the historically unique one - want only to
manipulate us.
There are, of course, highly publicised (if not over-publicised)
problems. The world is in the midst of a deep financial and economic
crisis. The EU has growing troubles with its increasingly visible
democratic deficit and is gravely divided as regards its own
institutional arrangements. The global climate is basically not
changing, but global warming alarmists have succeeded in persuading
politicians (and some ordinary people as well) that a doomsday is
coming and on this false assumption they have tried to restrain our
freedom and curtail our prosperity. The long-existing nucleus of
armed conflicts accompanied by immense suffering of millions of
people - in places such as Afghanistan, Iraq, Israel-Palestine and
some African regions - does not promise any quick solution.
The economic crisis should be regarded as an unavoidable consequence
and hence a "just" price we have to pay for immodest and over-
confident politicians playing with the market. Their attempts to
blame the market, instead of blaming themselves, are unacceptable and
should be resolutely rejected. The Czech government will - hopefully
- not push the world and Europe into more regulation,
nationalisation, de-liberalisation and protectionism. Our historical
experience gives us a very strong warning in this respect.
Looking for ways out, we should - to use an analogy - strictly
differentiate between fighting the fire and drafting fire protection
legislation. We have to concentrate on the first task now; the second
one can be done gradually, without haste and panic. A big increase in
financial regulation, as is being proposed so often these days, will
only prolong the recession. Growth in the global economy is falling
rapidly, the banks have ceased to grant credit and confidence is
ebbing. Radically changing regulation governing financial
institutions in the midst of recession is counterproductive.
Aggregate demand needs strengthening. One traditional way to do this
is to increase government expenditures, probably in public
infrastructure projects, on condition these are available. It would
be much more helpful, however, to have a great reduction in all kinds
of restrictions on private initiatives introduced in the last half a
century during the era of the brave new world of the "social and
ecological market economy". The best thing to do now would be
temporarily to weaken, if not repeal, various labour, environmental,
social, health and other "standards", because they block rational
human activity more than anything else.
As regards the EU's "constitutional" stalemate, the Czech government
will - hopefully - not lead Europe to an ever-closer union, to a
Europe of regions (instead of states), to a centralised,
supranational Europe or to an increasingly controlled and regulated
Europe masterminded from above. It will keep stressing its EU
presidency slogan "Europe without barriers", which means the advocacy
of further liberalisation, removing trade barriers and getting rid of
protectionism.
Our historical experience gives us a clear instruction: we always
need more of markets and less of government intervention. We also
know that government failure is more costly than market failure.
We can also count on the fact that the Czech government will
hopefully not be the champion of global warming alarmism. The Czechs
feel that freedom and prosperity are much more endangered than the
climate. The uniqueness of current levels of global warming is not a
proven phenomenon. The explanation of factors that are contributing
to global warming is not very clear and persuasive. Moves to mitigate
climate change by fighting carbon dioxide emissions are useless and,
what is most important, human beings have proved themselves to be
sufficiently adaptable to an incrementally changing climate. We
should turn our attention to other, really daunting issues.
The world in the year 2009 will not be spared armed conflicts,
international terrorism, and territorial and religious disputes which
- no matter how geographically distant they may be - will have
consequences for all of us. We know that peace cannot be declared
unilaterally and that long-lasting solutions are usually not the ones
that are imposed from abroad. The Czech government will not support
external interventions into the domestic affairs of sovereign
countries. We should resist being seduced by philosopher-king ambitions.
The pragmatic Czechs - with all their criticism of European decision-
making mechanisms - will not attempt to initiate a pan-European
"velvet revolution" but will promote their interests and priorities.
We will treat others as we expect to be treated: with respect for
different views. We will be happy if a common denominator in - at
least - some cases can be found. Reliance on negotiations and on the
positive effect of the diversity of views is what makes Europe Europe.
The EU presidency might give us a chance to make use of some of our
views to the benefit of the citizens of all EU member states. Their
welfare and happiness will be maximised in a free, democratic,
decentralised, open and liberalised Europe.
-----------------------------------------------
The writer is president of the Czech Republic. The Czech Republic has
just assumed the rotating presidency of the European Union
Wednesday, 7 January 2009
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