“Well written and an interesting perspective.” Clan Rossi --- “Your article is too good about Japanese business pushing nuclear power.” Consulting Group --- “Thank you for the article. It was quite useful for me to wrap up things quickly and effectively.” Taylor Johnson, Credit Union Lobby Management --- “Great information! I love your blog! You always post interesting things!” Jonathan N.

Saturday, March 23, 2019

Weak Corporate Governance at UBS Amid a $2.3 Billion Trading Loss in 2011

UBS chief executive Oswald Gruebel resigned on September 24, 2011 over the $2.3 billion trading loss by one of the Swiss bank’s traders, Kweku Adoboli. Kaspar Villiger, UBS's president, said the board regretted Gruebel's decision but had decided to accept it. "Oswald Gruebel feels that it is his duty to assume responsibility for the recent unauthorized trading incident," Villiger was quoted as saying in the statement. "It is testimony to his uncompromising principles and integrity."[1] In presumably not pushing for the CEO’s resignation because of the magnitude in the lapse of risk management in the system, the bank’s board of directors did not take the initiative in holding the management accountable. Accordingly, shareholders have reason to be concerned about the protection of their owner’s equity, at least in terms of corporate governance providing accountability on the management. The culprit may be corporate governance itself, which as structured may proffer too much power to the CEO.

The full essay is at "Weak Governance at UBS."

1. “UBS CEO Oswald Gruebel Resigns Over Rogue Trading Loss,” The Huffington Post, September 24, 2011. 

Structural Reform and Economic Sustenance in European Austerity

Speaking at the World Economic Forum in Davos, Switzerland on January 25, 2013, Mario Draghi, president of the European Central Bank(ECB), said the bank’s program to buy the bonds of heavily indebted E.U. states had been “very helpful” in reducing the perception that the euro was on the verge of collapse. He also pointed to the structural reforms that heavily indebted states had enacted as “now bearing fruit.”[1] He urged those governments to continue to implement structural reforms so those states could take advantage of the ECB’s low interest rates and easy credit to banks. In short, the strategy of the ECB was to use monetary policy as leverage for long-term-oriented structural reforms at the state level. Political risk analysts listening to the central bank official likely came away with a more optimistic stance on the long term prospects for the E.U. economy.

The full essay is at "Structural Reform and Economic Sustenance."
 1. “Davos: ECB’s Draghi Says ‘Real’ Economy Still Stagnant,” Deutsche Welle, January 25, 2013.


Friday, March 22, 2019

Pruning Back an Ideological "Re-Definition" of Socialism

Should language lose its integrity for ideological purposes? On Fox News in the wake of the passage of Obamacare, Brit Hume and Newt Gingrich, a former Speaker of the U.S. House of Representatives, both (re)defined socialism as “government control of private property.” Their rendering falls short, however. According to the Random House Dictionary (via Dictionary.com), socialism is “a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole” (italics added). Whereas government regulation of privately-owned means of production and distribution involves some of the control being in the hands of the community as a whole through its government, socialism includes the vesting of both ownership and control with the government. 

The complete essay is at "Socialism Redefined."

Tuesday, March 19, 2019

Including Voter Judgments on Broad Policies in Elections: An Expansion of Active Popular Sovereignty

Days after the 2018 Congressional elections in the U.S., the Minority Leader and soon-to-be Speaker of the House of Representatives, Rep. Nancy Pelosi, declared, “Healthcare was on the ballot and healthcare won.”[1] As the new Democratic-controlled House worked on a budget the next Spring, Pelosi was still insisting that healthcare was what that election was about. Perhaps she based her statement on exit polls in which most voters claimed that they had voted chiefly the basis of candidate positions on healthcare. This does mean, however, that the voters voted on healthcare, for as only a choice of candidates could be made, the voters were left with inferring or even hoping that the favored candidate would act on, or at least stay with, his or her position on the issue. I contend that the next leap in the theory and practice of representative democracy could be to no longer keep an electorate, the popular sovereign, limited to selecting among candidates.

The full essay is at "Expanding What Voters Can Vote On."

[1] Kimberly Leonard, “Nancy Pelosi: ‘Healthcare was on the ballot and healthcare won,” The Washington Examiner, November 7, 2018.

Monday, March 18, 2019

Saudi Arabia Going After Dissenters Abroad: On the Egregiousness of Concentrated Power

After having been selected by his father as the crown prince, Mohammed bin Salman of Saudi Arabia “authorized a secret campaign to silence dissenters—which included the surveillance, kidnapping, detention and torture  of Saudi citizen—over a year before the killing of Jamal Khashoggi, according to American officials” with access to the classified reports.[1] The killers of Khashoggi had been involved in at least 12 other such operations starting in 2017. The sheer egregiousness of the operation under the crown prince says something about not only dictatorship, but also the nature of power itself.