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Friday, June 22, 2012

Corporate Hacks Dominate at Mr. Jefferson’s University


The University of Virginia was thrown into a bit of an uproar in June 2012 after the university's president, Teresa Sullivan, “a 62-year-old eminent scholar of labor-force demography whose appointment drew national attention in 2010, was forced out during a closed-door session of the Board of Visitors in which no official vote was taken. The June 10 announcement that she would resign blindsided Sullivan and ignited wide outrage and protests,” according to the Associated Press. This controversy showcases the contemporary “corporatizing” tendency that has been taking place in university governance more generally. For non-academics to trump scholars on matters touching on academic policy is at the very least counter-productive (if not illogical). In this essay, I discuss Sullivan’s ouster at Virginia in order to advance the proposition that faculty senates rather than boards of corporate managers should have the final say on policy at colleges and universities. At public universities, only a legislature or president should be able to over-rule a faculty (assuming there is a very significant proportion of public funding).

Regarding the controversy at the University of Virginia, the Associated Press reported that, “(f)or her part, Rector Helen Dragas publicly disclosed Thursday more detailed reasoning behind Sullivan’s ouster.” She “did acknowledge that the board mishandled Sullivan’s removal, and apologized. ‘In my view we did the right thing, the wrong way,’ Dragas said.” Her “six-page statement said Sullivan wasn’t acting quickly enough to address financial pressures facing higher education, the role of online learning, changes in the health care environment, the increased student-faculty ratio, fundraising, and other strategic challenges. The university lacks long-range plans on several of those fronts, it added. ‘No matter how you feel about our actions, these challenges represent some very high hurdles that stand in the way of our university’s path to continued success in the coming decade, and they are going to remain front and center for the next board and the next president over the coming years,’ the statement said.”

 For her part, Sullivan countered by saying, “Sweeping action may be gratifying and may create the aura of strong leadership, but its unintended consequences may lead to costs that are too high to bear.” Moreover, “Corporate-style, top-down leadership does not work in a great university,” she said. “Sustained change with buy-in does work.” The subtext here is that scholars don’t behave like corporate managers. Running a college is more like herding cats than managing by memo. Not being scholars themselves, the board and its chair at Virginia missed this vital distinction. According to the New York Times, “(m)any public university presidents, past and present, said that those on the boards of the leading universities — typically business executives without much experience in academia — do not always understand the complexities of leading a large research university, and the degree to which a president can succeed only by persuading. ‘Everybody thinks university presidents are hierarchical and top-down,” said Donna E. Shalala, president of the University of Miami . . . ‘But we are not corporate chieftains, and we cannot rule from the sky. We are more like tugboat captains, trying to get our ships aligned and pulling them in the right direction.’ The great research universities, she said, have achieved their dominant position in the world through shared faculty governance, and leaving faculty both academic and research freedom.” Such freedom does not compute from a corporate mindset. Whereas military-style “orders” are commonplace in the business world, scholars bristle at the prospect of a colleague barking out commands. "In the end," according to the Times, "the fundamental disagreement at the University of Virginia concerned the approach to change that the president should take — either incremental, with buy-in from each of the constituencies, or more radical, imposed from the top." That is, the ways of academic clashed with an interlarded corporate approach.

Indeed, the board at Virginia came from a very different world than that of years in a doctoral program followed by still more years working toward tenure. "Political contributions to our governors have become more important factors in the selection of our board members," said John Casteen III, who served as President of UVA for the 20 years prior to Sullivan's appointment. According to the Huffington Post, The UVA Board of Visitors included “a real estate developer, a coal company magnate, a Wall Street professional, a top lawyer for General Electric, a nursing home executive, [and] a beer distribution entrepreneur.” Lest it be presumed that the lawyer (or a physician) could substitute for a scholar, neither the first degree in law nor the first degree in medicine constitutes a doctorate. 

Accordingly, the board's motivation may have been rather pedestrian, or corporate (think of Fuld at Lehman Bros or Coyne at Bear Stearns), without due respect for the academic values and traditions particularly dear to the scholars who teach at the university. The Huffington Post reports that emails between the Rector and Vice-Rector “indicate that much of their motivation to remove Sullivan stemmed from three media articles, rather than professional or academic literature. One, a New York Times column by David Brooks, lauded online courses, as did a Wall Street Journal editorial, and an article in the Chronicle of Higher Education.” In one email, the Vice Rector even suggests that providing a “modicum of candor” might be prudent. I smell a rat. 

The secrecy of the board’s decision alone—without even a formal vote being taken (and given the failure of the Rector to adequately explain her “board’s” decision after the fact to the faculty senate meeting behind closed doors)—suggests that the real reason could have had more to do with personalities than policy. However, if “philosophical differences” were at issue as Sullivan suggests in her public statement after her firing, I submit that it is scholars rather than political donors from the business world and that of the professions who have the wherewithal to make judgments regarding academic matters, as in determining whether (and how much) to expand on-line courses. According to the New York Times, Dragas had been "especially concerned about pushing ahead in online learning." Sullivan warned that online education was no panacea — and indeed, was “surprisingly expensive, has limited revenue potential and unless carefully managed can undermine the quality of instruction.” Scholars such as Sullivan are in a much better position to judge the academic suitability of such courses than is a beer distributor, a business executive, or a physician.

Pedagogy as well as learning can take a real hit if technology is relied on too much, especially at the doctoral level where the in-person aspect of seminars has real academic value. To assess that value, one must have experienced it oneself, rather than merely read about it online. Regarding the for-profit colleges that offer “on-line doctorates,” I worry that the doctoral degree itself is being rarified rather than protected. I have met students in such programs who somehow claim to know all about the alternative that they are missing. Of course, they are perfectly able to dismiss its academic value without even a suspicion that they could be wrong about something they have never experienced. Such a mark of closed ignorance among “doctoral students” is itself a red flag concerning where “higher education” in America is headed. 

In the case of on-line courses, the application to freshman and sophomore lecture classes is one thing, whereas the application to doctoral seminars is quite another. My point is that scholars who have lectured in large lecture halls and taught small graduate seminars are in a unique position (i.e., superior to non-academics on a university's board) to discern this vital difference. That a beer distributor would sit in judgment over a professor's judgment on such a matter is a bit like wandering down the rabbit hole only to expect things to be the same. To a scholar, the presumptuous entitlement of such overarching ignorance can only be emetic, not to mention downright insulting.

Generally speaking with respect to the academic and corporate worlds, what is of value in academic terms does not necessarily translate into financial terms (or value). A visiting scholar at a university who does research, for example, is likely a “zero budget item” (i.e., not paid by the university), yet he or she is of high academic status by virtue of having earned a doctorate (and perhaps even published a book, by which I don't mean one filled with simplistic bullet-points and overly-complex organizational diagrams).

To a business practitioner or professional (i.e., a lawyer, CPA, or physician), such academic status sans salary does not translate, and thus is of no value. In fact, the value would be negative, given the presumed opportunity cost (i.e., the money that could otherwise be earned by being bored in a mindless corporate cubicle). Lets be clear: that something has no value in corporate or business terms does not mean that it has no value. Even if a society allows its business sector to set societal norms, the realm of knowledge (i.e., scientia) is not so pliable, at least in principle. Perhaps the same could be said of the religious realm. How much value in business terms can be attributed to the Kingdom of God, for instance?

Showing its true colors, the “corporate” board at the University of Virginia evinced an utter lack of respect for the university's scholars by refusing even to provide the faculty senate with an explanation with a “modicum of candor.” To reduce scholars to a modern employee-classification (which is a given at least at for-profit "universities") ignores the academic status of scholars in academia. That is, it ignores the qualitative differences that distinguish faculty, staff, and students at a college or university.

Some staff try to get around basic clusters (i.e., faculty, staff, and students) by referring to themselves as "academic staff." To be sure, librarians are not exactly kitchen help, but neither do librarians hold a doctoral degree (e.g., the DBA, Ph.D., D.Sci.M., J.S.D., or Ed.D.). Hence, even the very laudable (and valuable) librarians working in academic libraries cannot be counted as colleagues with the scholars.

At one large research university at least, a significant number of graduate students in doctoral programs in the liberal arts claim to be colleagues with their professors because those students teach too. They refer to the "undergrads" there as the students. "I'm not a student; I'm a graduate student" is the sort of illogical claim made as if with impunity by some of the more arrogant usurpers. Their teaching, by the way, is typically limited to discussion sections of their professors' lecture classes.

Lest there be any confusion, graduate students are not colleagues with their professors. That this rather basic academic point is denied or ignored when convenient is just another indication that modern academia is under threat even from within its ranks. The fact that university governance boards increasingly rely on people from outside academia suggests that academic mores and standards will not be protected even from the encroaching decadence within universities.

Referring to Sullivan's firing, a program officer at the American Association of University Professors laid out the basic flaw that has been allowed to fester in university governance. "More and more boards come from non-academic backgrounds, and one consequence of that is a lack of appreciation for and understanding of the academic enterprise,” said Robert Kreiser. He told the Huffington Post that "the UVA debacle is only the most extreme example of an ongoing phenomenon in which those ‘who don't appreciate what higher education is about and who are more concerned about corporate interests and corporate considerations’ come to govern academia.” Both the hegemony of corporate interests (and values) in corporate governance and the tacit lack of respect in the business sector (and American society more generally) for the vocation of the scholar should be (but sadly are not) recognized as red flags. At the very least, the priority belies any interest in the higher education of generations to come (i.e., your children).

Therefore, we should return to the classical notion that a faculty of scholars ought to have the final say in the running of a college or university. At the very least, a version of the business judgment rule in corporate governance (wherein managerial judgment on business matters trumps stockholder votes) should apply to a faculty's academic judgment trumping decisions of a non-academic board (and even a legislature or president in the case of a public university).

The university as an institution has been around, at least in the West, since the High Middle Age. Aquinas, for example, taught at the university in Paris. Applying a corporate mindset (or governance structure) on top of such a seasoned institution is bound to cause problems. I would not blame the professors at the University of Virginia were they more than just a bit annoyed at being relegated on their own turf, or campus (which literally means “field” in Latin), by people in the "real world." This expression itself is highly insulting, as it conveys a judgment of utter dismissiveness regarding the world of academia. The message is that the pursuit of knowledge is in itself inherently irrelevant (e.g., of "the Ivory Tower"). Let’s be clear: wanting to get something useful out of a university does not necessarily involve respect for its sui generis (i.e., unique) ways and values. Furthermore, to filter knowledge according to its contemporary usefulness and display the results as if a poll on power-point slides vastly misconstrues even what knowledge is. To presume to govern the enterprise from such an “understanding” is at the very least audacious, not to mention disrespectful and even reckless.

It is time, in other words, to return academia to the men and women who know and respect it on its own terms (i.e., rather than trying to turn it into a different beast). This is the real lesson coming out of the tussle at Mr. Jefferson’s university, where truth, at least in pinciple, is to be pursued no matter where it leads. Business managers and even the folks in the professional caste do not have this faith. They are thus utterly unsuited in their presumptive entitlement to govern academia as if business trumps knowledge. In other words, there should be some check within academia on the infiltration of the subverted societal values. What's good for GM is not necessarily good for the classroom. 

Fides de scientia: Lux et Veritas must be nurtured, pursued, and protected as ends in themselves, rather than squandered for sordid lucre or subjected to petty politics.


Sources:

Zach Carter and Jason Linkins, “Teresa Sullivan University of Virginia Ouster Led by Politcal Donors Lacking Academic Experience,” The Huffington Post, June 21, 2012.

Associated Press, “University of Virginia Board to Meet to Consider Reinstating President; Rector Defends Ouster,” The Washington Post, June 21, 2012. http://www.washingtonpost.com/national/higher-education/university-of-virginia-board-will-consider-reinstating-president-rector-defends-removal/2012/06/21/gJQAv7NrtV_story.html


Tamar Lewin, "Public Universities See Familiar Fight at Virginia," The New York Times, June 25, 2012.




Thursday, June 21, 2012

Saving the E.U.: Beyond the Squabbles


During the G-20 meeting in Mexico in June 2012, the E.U.’s financial mess was front and center. Francois Hollande wanted the European Central Bank to issue euro bonds and be able to loan directly to banks and to the European bailout funds. In general, he wanted the E.U.’s bank to operate more like the United States’ Federal Reserve—that is, as a lender of last resort (though the Fed could not issue debt to guarantee state debt). In response, Ms. Merkel contended that those proposals must come after more state sovereignty is shifted to the federal level. Shared debt can work only if there is shared decision-making over budgets, taxes and pensions, she said. As Joschka Fischer, a former German foreign minister and Green party stalwart, said, “You can’t mutualize the debt without mutualizing sovereignty; you can’t have the financial benefits of a state without having one.” And yet, the E.U. already had substantial (but not sufficient) governmental sovereignty.


          France's Francois Hollande and Germany's Angela Merkel at the G20 Summit.      AP

Institutionally, the E.U. already had legislative, executive and judicial branches of government. The issue was whether that federal government would get more sovereignty. Put another way, the question was whether Europeans would finally face the fact that they already had a federal system of dual-sovereignty (albeit unbalanced in terms of power due to the denial), rather than a “network” or a “currency union” along with a “fiscal union” and whatever other sort of union one might care to add.

Standing in the way, as one senior diplomat put it, is the fact that France has always wanted what Charles de Gaulle called “L’Europe des patries,” or the Europe of homelands, which keeps important decisions firmly in the hands of state leaders. In American terms, this position would be called “states’ rights” or “anti-federalism.” Having insufficient votes in his state legislature for the constitutional changes needed to shift the additional sovereignty to the federal level, Hollande would likely have at accept a referendum on the question, which could fail if the anti-E.U. forces dominate the public debate.

For one thing, “more Europe” has been thought by many Europeans to mean “more German.” “(M)ore Europe means more centralized institutions with more power, and that means more Germany,” said a senior diplomat. This assumption can be questioned, however, as the additional sovereignty could be put in the hands of the E.U.’s lower legislative chamber, or parliament. The members of that body represent E.U. citizens rather than states (which are represented in the European Council). So it need not be that additional authority would go to Germany or even to “bureaucrats” at the Commission.

Even so, to make the pill easier to swallow, the constitutional amendment shifting more sovereignty to the federal level could contain language making it more difficult for large states to dominate at the federal level. In the U.S. federal convention, New Jersey put forth its own plan as an alternative to that of Virginia in order to safeguard the interests of small states against the biggies. A similar process of compromise could be worked out in the E.U. so the additional “federalization” would not be tantamount to “Germanization.” For one thing, increased power could be given to the E.U. Parliament as part of the deal. That, along with the removal of the veto of individual states in the European Council, would also assuage fears that the “democracy deficit” would increase with the transfer because majority rule in the Parliament would play a larger role in the E.U. Government.

Just as squabbles between rival states would have sunk the federal convention's project of a "more perfect union" in America in 1787, jostling between France and Germany out of fear and short-term or provincial interests held Europe back in 2012. I’m tempted to wonder (je me demande) whether Germany might have actually faced a “be careful what you wish for” scenario because a stronger federal government could possibly come at that state’s expense eventually. So in matters of constitutional design (i.e., proposing amendments), it is best to have a long-term perspective oriented to the good of the whole rather than to one’s current, particularized interest. At the very least, one's interest might change. This insight was in short supply in Europe, unfortunately, as E.U. state leaders wrestled with how to safeguard the euro constitutionally without giving up too much.

Il faut voir la grande image. Das ist wichtig. Dann kann Man die Zukunftsplänen machen. Haben Sie keine Angst über Deutschland oder Frankreich. Lassen Sie los, und stellen Sie sich ein besser Europa vor. Construisez vous une ville sur une colline, avec une vue dégagé.

Source:

Steven Erlanger, “France and Germany Face Delicate Talks Over Economy,” The New York Times, June 21, 2012. http://www.nytimes.com/2012/06/22/world/europe/france-and-germany-face-delicate-talks-on-economy.html?pagewanted=1&_r=1&hp

Wednesday, June 20, 2012

Egypt’s Generals: “Boundary Issues”


In a letter to Bishop Mandell Creighton in 1887, John Acton (1834-1902) wrote, “Power tends to corrupt, and absolute power corrupts absolutely. Great men are almost always bad men.” This line could be applied to Egypt’s ruling generals both just before and after the presidential election in June 2012.

Days before the election—perhaps in anticipation of a victory by the opposition party—the generals and their allies in the court dissolved the legislature, which after the legislative election had been controlled by the opposition. As if this affront to democracy was not enough, the generals announced that they, rather than the opposition party’s presidential victor, who had received 51.7% of the vote, would appoint the president’s chief of staff. In a sense, this affront is more shocking than the generals' dissolution of the legislature or emasculation of the powers of the presidency because of the sheer presumptuousness in appointing someone else's chief of staff. That is generally recognized as an internal matter to a president.

The generals are like a roommate who thinks nothing of moving one’s personal toiletries in the bathroom (such things are generally known to be personal) or taking and eating one's food from the refrigerator. In other words, the generals had what can be called “boundary issues.”


                             Gen.s el-Assar and Shahin holding a news conference.        Sami Wahib/AP

Days after the election, the Generals’ strategy was clear: “Say one thing and do another.” General Assar claimed in a news conference days after the election, “we will give the president of the republic his complete powers.” And yet, the New York Times reported soon thereafter that under the generals' plan, Morsi, the new president, would "assume an office stripped of almost all authority." For example, the new president would not have jurisdiction over the military or its budget, not to mention even his own chief of staff . The aggrandizing generals preserved “broad powers for themselves over matters including defense, national security and perhaps some broad economic issues,” according to Mona el-Ghobashy, an Egyptian political scientist.

What the Egyptians needed was a Teddy Roosevelt of sorts: a man of the bully pulpit who was not afraid to go up against the monopoly trusts of his day (which is why New York bosses had gotten him out of the governorship and into the "safe" (i.e., vacuous) vice presidency). Weeks after being elected, Morsi showed TR-like guts in recalling the parliament that the top generals had dissolved. “He has been waiting to make a decision to prove he is president of a republic,” Gamal Eid, a prominent human rights lawyer, observed.

Lest Morsi be accused of ignoring the ruling of an admittedly-politicized constitutional court, Eid adds that the president’s decree “abolishes an executive order, and it is not related to the constitutional court. It negates the decision of the military council.” He added, “If the choice is between the decree of an elected president and a military council with questionable legitimacy, then we choose the elected president.” Adding to its legitimacy vis à vis the court, Morsi’s decree came with a time limit: the Parliament could serve only until a new constitution could be completed, followed by fresh legislative elections within 60 days. Even though this caveat acknowledged the court’s demand for a new Parliament, the decree nonetheless instantly prompted the generals to call an "emergency meeting" to “discuss the situation.”

Morsi deserves considerable credit for doing what he could rightly have expected to result in opposition (and even an attack) from the generals’ council, whose continued authority was questionable at best, given the generals’ pledge on assuming power to dissolve their council upon the inauguration of the president. The entitlement presumed by the “emergency meeting” is itself pathological, as the response assumes a sort of default authority, which could only be artificial. At the very least, the response evinces an obsessive-compulsive sort of  “control issues.”

I would not blame Morsi one bit were he afraid of the generals as he stepped off the reservation. Regarding the generals’ psychology, to gut an office of power is an underhanded (not to mention selfish) way of not recognizing the democratic legitimacy of an election that does not go one’s way. That is to say, the childishness evinces a selfishness that does not play well with others. To presume the authority to appoint someone else's chief of staff is beyond bad table manners; it is low class and even passive aggressive. The move is essentially a coup by pen, even if it is tacitly backed up by the threat of guns. Apparently it is difficult for some to let go of power even as promised, especially when that power is absolute. I don't foresee the generals playing well with Morsi, as his democratic legitimacy means that their continued grasp on power was something considerably less than absolute, at least in terms of legitimacy.

The lesson for us as a species is perhaps the following: a people should be very careful in deciding who is to hold “the precious ring” even just temporarily, as a caretaker, for, as Lord Acton wrote, the allure of the ring is strangely much more nepharious than meets the eye. Furthermore, this case demonstrates just how important it is for a government to have a constitution. The competing claims of Morsi, the court, and the generals’ council could find no common basis without one. Put another way, how could the constitutional court have a basis of legitimacy in interpreting a constitution without one? Without a constitution, Morsi was free to negate the court’s usurpation. Even were a constitution extant, it would be beyond the reach of the judiciary to declare another branch null and void. Most crucially, a constitution maintains and protects the viability itself of the basic institutions of government—this is the basic constitutional function that is up for grabs in the absence of a constitution. 


Sources:

David Kirkpatrick, “After Victory, Egypt Islamists Seek to Challenge Military,” The New York Times, June 18, 2012. http://www.nytimes.com/2012/06/19/world/middleeast/islamist-candidate-is-apparent-victor-in-egypt-as-military-cements-its-powers.html

David Kirkpatrick, "Morsi Is Winner of Egyptian Presidency," The New York Times, June 24, 2012.

Hamza Hendawi, "Morsi Orders Dissolved Parliament Return, Defies Military Leaders," The Huffington Post, July 8, 2012.

Kareen Fahim and Mayy El Sheikh, “Egypt’s President Orders Return of Parliament,” The New York Times, July 8, 2012. http://www.nytimes.com/2012/07/09/world/middleeast/egypts-president-orders-return-of-dissolved-parliament.html?_r=1&ref=world

Tuesday, June 19, 2012

Greek Austerity Win at E.U.’s Loss?



According to one director of a public-debt consulting firm in the E.U., “In the realm of investor perceptions, Spain has crossed the Rubicon from solvency to insolvency.” A day after Europeans in the state of Greece had given a narrow victory to parties in favor of maintaining the austerity program there, investors’ concern regarding the viability of the euro pushed the yield on Spanish 10-year bonds as high as 7.2 percent—a level that Spain’s economy minister, Luis de Guindos, claimed is unsustainable in the long term.

Investors gave little credit to the victory of the New Democracy party in Greece. In fact, they may have worried that that party’s victory would take the pressure off E.U. leaders (including governors active at the federal level through the European Council) in making long-term structural change to the federal system—specifically, to the balance of power between the states and the Union.

The hypertrophic power at the state-level goes a long way in explaining why the E.U.’s way of responding to the public and private debt crisis in five states has been knee-jerk or incremental in nature. Donor states were able to veto stimulus spending, E.U. bonds, and even modifying the austerity agreement at the expense of the E.U. itself. Given the market’s notably short-term bias, it is significant that investors were pushing E.U. leaders toward a long-term, structural change to the E.U. itself. To put it differently, even the notoriously short-term-oriented investor-sector was ahead of the E.U.’s state officials on long-term, or constitutional, matters.

Even if the origins of the financial crisis were in the subprime-mortgage securities markets on Wall Street rather than in over-extended housing markets in both E.U. and U.S. states as E.U. Commission President Jose Barroso charged at the G-20 meeting in Mexico a day after the Greek vote, the structural flaw in the E.U. itself rendered that union inherently unstable. Barroso was reacting to U.S. President Barak Obama’s plea that the E.U. leaders not let up on needed structural reforms just because the victory of the New Democracy party in the E.U. state of Greece had staved off default there.

 In any event, it is by no means clear that the over-extended real-estate markets in the E.U. states of Ireland and Spain had been caused by something in North America, so Barroso was probably just expressing his frustration with things closer to home rather than from pressure from the U.S. Specifically, the lack of sufficient interest among several state leaders active at the E.U. level (via the European Council) in shifting more governmental sovereignty from the state governments to the federal government meant that the euro might not be sufficiently safeguarded in the long term. Moreover, the self-interest at the state level to retain power there even at the expense of the Union of which the states are members meant that the E.U. itself would not be sufficiently balanced in terms of federalism to be able to face future crises beyond what the respective provincial interests of a few large states would dictate or allow.  Barroso may also have been frustrated by Germany’s Angela Merkel.


Although the German Kanzlerin was still willing to transfer more sovereignty to the E.U., she had just pivoted (as if on a dime) off her recent Greek-election-prompted “stimulus with austerity” back to her earlier “austerity-only” position in the wake of the victory of the New Democracy party in the state of Greece. “The Greek government will and must naturally follow through on the commitments that were made,” Ms. Merkel told reporters at the Group of 20 meeting in Los Cabos, Mexico, disappointing those in Athens who hoped for a signal of new flexibility toward Greece in the wake of the vote. “There can be no loosening of the reform steps.” Man kann nicht? Wirklich? Es ist nicht möglich?  I beg to differ. It was indeed possible. Moreover, where was Merkel’s earlier assurance that stimulus spending could be added as a separate agreement?

Hollande’s victory in France the month before, followed by that of his Socialist party the very day before, had evidently not convinced Merkel that returning to an austerity-only platform might not be the best platform for re-election in the next year. However, it could that her electorate was more favorably inclined (than the French) to pushing austerity on other states, given the relatively good credit-rating Deutschlands (that of France had been lowered in 2011). On the other hand, Merkel’s CDU party had very recently suffered a significant loss in a large (i.e., in terms of population) county.

 According to the New York Times, “German hard-liners were emboldened by the victory, viewing it as an endorsement of the drive for structural adjustment in Greece and elsewhere in Southern Europe through further austerity. As a result, the vote may delay concerted pro-growth steps by central banks and governments around the world, as well as the hard choices within Europe over deeper integration that are likely to prove necessary in the long run.” That is, beyond the implications for Merkel in her state, the victory of New Democracy in the state of Greece not only staved off short-term hard decisions for the E.U. regarding Greece, but also made the E.U.’s needed structural change more unlikely—not to mention short-term economic adjustment (i.e., stimulus spending to be added to the austerity) regionally.

While the victory in the state of Greece was perhaps in the short-term interest of the state of Germany, the long-term overall interest of the European Union was, at least in the view of investors, in perhaps even greater jeopardy. Put another way, a more pressing need necessary to prompt needed structural or federal changes may have been dodged in the victory of the status quo in Greece. It is interesting that a case of democracy at the state level voting for continued sacrifice—a feather in democracy’s cap—might not be in the constitutional interest of the E.U. as a whole, at least as it seeks ever perfect union capable of thwarting the threat of dissolution.

 Sources:

Stephen Castle and Raphael Minder, “Lingering Fears Push Spanish Short-Term Borrowing Costs Up,” The New York Times, June 19, 2012. http://www.nytimes.com/2012/06/20/business/global/daily-euro-zone-watch.html?pagewanted=1&_r=1&hp

Nicholas Kulish and Jack Ewing, “Greek Voting Past, Europe Returns to Fiscal Rescue,” The New York Times, June 18, 2012. http://www.nytimes.com/2012/06/19/world/europe/greek-vote-past-europe-returns-to-fiscal-rescue.html?ref=todayspaper

Monday, June 18, 2012

France’s Hollande: Standing Above His Party’s Legislative Victory


In the 2012 election of France’s legislative Assembly following the election of Francois Hollande to replace the deeply unpopular Sarkozy, “the Socialist Party won 280 seats and two allied parties won another 34, giving the parliamentary bloc 314 seats — considerably more than the 289 needed for a majority in the National Assembly. The Greens, who are part of the government, have another 17 seats, while the far left won 10. Former President Nicolas Sarkozy’s center-right Union for a Popular Movement won 194 seats and its allies another 35 seats, bring the total to 229 seats, a sharp drop from 304.” The typical analysis ensuing from this result concerned the added strength that Hollande would have in pushing the E.U. toward balancing austerity with stimulus spending. The Prime Minister, Jean-Marc Ayrault, said the government would work to fix public finances and reduce unemployment. “The goal is to shift Europe toward growth and protect the euro zone from speculation,” he said. “The task before us is immense.” At least the Socialist Party would not have to deal with other parties on the left that are less pro-E.U., as the Socialists had established an absolute majority in the state’s Assembly.  However, the Socialists did not have the three-fifths majority needed to make changes to the state constitution, such as shifting more governmental sovereignty to the E.U. (federal) level. At the time, the E.U. was at a precarious place in not having enough sovereignty to safeguard the euro.

Interestingly, during the evening of June 17th as the election results came in, Hollande stayed out of the media spotlight. It was the prime minister, Jean-Marc Ayraunt who spoke for the Socialist Party. He spoke along with the leaders of the other parties and several candidates (both winners and losers). Hollande’s absence was notable because it suggests that it might not be wise for a figurehead to be perceived as being too partisan; unlike party leaders in a legislative body, a governor or president represents the republic as a whole, and thus the public (rather than partisan) good. Hollande was smart to spend the evening preparing for (or travelling to) the G-20 meeting en Mexique le lendemain. Standing apart from the temptation to publically celebrate the victory of his party, he put himself in the future position of being able to credibly claim that agreeing to shift more sovereignty to the federal level is en l’intéressé de la France. In other words, resisting the temptation to engage in partisan displays can translate into political capital that a figurehead can use to facilitate a shift in the constitutional design of governance. Moves on this scale are fitting for a figurehead who is oriented to the big-picture rather than to trying to win on every issue.

Source: 

Steven Erlanger, “Socialists’ Victory in France Buttresses Hollande’s Power,” The New York Times, June 17, 2012. http://www.nytimes.com/2012/06/18/world/europe/french-socialists-win-majority-in-parliament.html?pagewanted=1&ref=world