You can’t use hindsight to write a 20-year plan
All the great visionaries wore beards.
Last summer, Iceland applied to join the European Union.
Now the European Commission says that accession talks are to begin, but that negotiations should not take long because the island is already pretty much in line with requirements and there isn’t that much that needs to be done.
Iceland’s decision to become part of the EU does not augur well for the prospects of Joseph Muscat’s 20-year plan for Malta, currently being touted as the cure-all for the nation’s ills.
Around seven years ago, as we were in the throes of our own EU membership agonies, Muscat gave some famous advice to the leaders of Iceland: stay out of the EU and continue to be successful. Malta will follow your example.
Less than six years later, and Iceland is in an economic shambles precisely because it is not in the EU or, more precisely, the Eurozone. EU membership would have done nothing about its banks or the way they were run – just as it didn’t help the situation in Britain – but the real source of the trouble was the kroner, which crashed.
Iceland, to an even greater extent than Malta, is dependent on imports for most of what its people use, wear, eat, drink and drive. When the value of Iceland’s currency collapsed overnight, making it almost impossible to pay for those imported goods, then the Icelandic people found themselves in some very serious trouble, from which they have not yet recovered.
Seven years ago, Joseph Muscat wanted Malta to be the Iceland of the Mediterranean, going it alone while importing almost everything and retaining its lira. If Muscat had got his way by dangling from Sant’s coat-tails while serving as a Super One hack, today Malta would be in more or less the same dire straits that Iceland is now.
And we would be knocking timorously on the European Commission’s door for permission to enter, after having fooled around and played Catch Me If You Can twice already.
Muscat said more recently – words that will go down in the petty annals of our history – that “with hindsight” he thinks “the Yes vote might have won the referendum”. Hindsight proved useful to him, too, he said, in working out whether EU membership is a good thing for Malta, though he doesn’t tell us whether the answer to that one is Yes or No.
I suspect he thinks it’s Yes, but he’s too scared to say so because of the political fall-out and more especially, the flak he’ll get from all those who, like me, were made quite ill by having to listen to his weekly rants against membership on that Super One show he hosted. What was it called? Oh yes: Made in Brussels.
Muscat depends on hindsight, but what political leaders need is foresight. A 20-year plan for Malta, besides being ridiculously pretentious and unrealistic – it smacks of the sort of thing to emerge from the wrong side of the Berlin wall pre 1989 – cannot be written with hindsight. It requires the foresight of an Old Testament prophet.
If Muscat was unable to see that EU membership was the safe step for Malta, if he wanted us to be in Iceland’s shoes, then how in heaven’s name is he going to plan our lives even three years from now, still less 20?
Twenty-year plans are the stuff of communism and dictatorships (and I’ll bet this 20-year plan is the stuff of Muscat’s adviser Mario Vella). Planning that far ahead depends on minimising or eliminating, through force, all possible variables.
You can maintain consistency and eliminate variables behind an Iron Curtain, but you can’t do this in the free world, which remains dominated by the unpredictable forces of the market and of unfettered human impulse.
His inability to assess situations in any way other than retrospect might be one reason why Joseph Muscat visibly tenses up when asked what Labour plans to do when it is in government. He talks rot, throws a few verbal shapes, and hopes he will get away with it. He did so for the first year, but now we’re heading for his third year as party leader and our patience is wearing a bit thin. It looks like there’s no beef in that particular pie.
Muscat tells us to wait and see, and that the proof of the pudding – an expression he picked up from Sant – is in the eating. Somebody should sit him down and patiently explain that a general election is not a lucky dip, and that people must be told exactly for what they will be voting.
Before they vote on these policies, they need time to assess and debate them, to work out whether they are worth the country’s while. That process of debate should start now. Indeed, it should have begun a year ago at least.
So far, all we have to chew on is his promise for a private member’s bill on divorce, but no actual legislation for divorce even though he plans to be in government when he brings forward that private member’s bill. To sum up the situation, Muscat will be running the government, but instead of legislating for divorce as it will be in his power to do, he will move a timorous private bill and, because it is a private bill rather than a government bill, he cannot use the party whip.
Hence, his gesture of ‘giving a free vote’, which he is trying to sell as respect for the individual conscience, is actually the only thing he can do, because he has no choice. The party whip can be used only for a party bill, and not for a private one.
This is the best that Muscat appears able to do. Two years down the line and we don’t have a single commitment on what Labour will do in three years’ time. Somehow, I don’t think it will take much hindsight to work out that Muscat is but the latest in a four-part series of bad-news Labour leaders.
And then they accuse people like me of never finding anything good to say about Labour. Are they surprised? Finding something positive to say about that ship of fools is like looking at some truly hideous baby in its pram and, lost for words, complimenting its besotted mother instead on the lovely blanket that is – mercifully – covering most of the unattractive child.
This article is published in The Malta Independent on Sunday today.
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Greece is in the EU and in the Eurozone but is also in shambles. Spain’s unemployment is almost 20%…and it’s in the EU and eurozone.
[Daphne – Iceland’s problems are largely due to the collapse of its currency. If it were in the Eurozone, it would not have had a collapsed currency.]
No, Daphne. This is either disingenuous of mistaken. It is Iceland’s banks and their madly speculative lending which have brought about the collapse. The kroner’s collapse was a subsequent side-effect.
Ireland – a country which, like Iceland, used speculative lending to fuel the boom and grew at spectacular rates – is in the throes of its worst recession in 50 years.
In times of recession, devaluing your currency can be an effective way of stimulating economic growth. Of course, it is a dangerous game (and one Iceland seems to be struggling to keep up with) but one of the greatest problems faced by the Euro-PIGS (Portugal Ireland Greece and Spain) is that, as unemployment soars, they have absolutely no control over their currency and must adhere to the ECB’s dictats.
I’m pro-Euro myself, but your arguments regarding Iceland are either disingenuous or unintentionally misleading.
[Daphne – They are neither. The point of my piece was that if Iceland had been in the Eurozone, it wouldn’t have had its problems compounded so severely by the collapse of its currency. Britain has had a similar banking crisis but because it is not 100% dependent on imports for consumables, as Iceland is, its situation is nowhere near as dire.]
Iceland crashed because people and businesses borrowed too much money without enough collateral to back it. In other words, credit was so cheap that people took irresponsibly high risks. Rapid success in recent years fooled them into believing that you could go out on a limb indefinitely. Then the bubble burst, as it was wont to do.
Iceland cannot be compared to Malta, where risk is an almost unheard of factor in business — otherwise why would most of our productive industry be the fruit of foreign direct investment and most native investment would not happen without handouts from the Government in one form or other? That said (and from a socialist that supported Malta’s EU accession) Icelanders are still better off than us, even after the crash.
[Daphne – ‘And from a socialist that supported Malta’s EU accession’. Let’s hope that if you’re asked how you voted in the general election after the referendum, Dominic, you won’t do what Marlene Mizzi did and tell us that you voted for Sant because you were morally convinced that he would change his mind about EU membership.]
What’s that got to do with anything? I was talking about Iceland and Malta. If anyone asked me how I voted I’d simply say ‘none of anyone’s business’.
[Daphne – Yes, I know. That’s why I didn’t ask. One day I will understand why people refuse to say how they vote. I feel no such embarrassment myself: I voted Yes in the referendum and then PN in the general election. The secrecy of the ballot is voluntary, not mandatory.]
Who’s talking of embarrassment for God’s sake?
Let’s stick to the subject. If Iceland were in the Eurozone and abided to the Eurozone regulations would it have avoided the crisis?
[Daphne – It would not necessarily have avoided its banking crisis, but it would certainly have avoided the mega-inflation and scarcity of consumables that have made life a misery for people in Iceland. When your currency is worth almost nothing and you have to import everything, the result is near-empty shop shelves and the sort of prices that are unaffordable, even for ordinary food items.]
IF Iceland were and IF it had, yes. But you could be in the Eurozone and NOT abide by its regulations, and you better not think that belonging to the Eurozone will be your safety net if you don’t, say by running high deficits and letting the national debt spiral out of control.
. . . one can mention that Greece and Spain have Socialist governments.
… one can also mention USA capitalism failed miserably and threw the whole world into recession. The usual arguments trying to associate 2 different arguments. So Hitler was a catholic therefore all catholic are Hitlers? Idiot!
Correlation does not imply causality Mr Ripard. Even a teenager knows that.
ASP, Greece and Spain have Socialist governments which promised what the ‘people’ wanted so by your own reasoning we can conclude that a Labour government for Malta in the EU means disaster.
U kemm ghandna il-memorja qasira! Ara tiftakrux dan il-ktieb ohxon li hadd ma’ qrah kollu u li ftit xtrawh, li kien ikkwotat qisu l-Bibbja qabel l-ahhar elezzjoni ?http://www.youtube.com/watch?v=4UJk682lBec
http://www.youtube.com/watch?v=Je-JdfqS_y8
Issa se jkollna it-Tieni verzjoni (riciklata) ta’ “Pjan Ghal Bidu Gdid
I just read Benoit’s piece in today’s Independent. That woman is a first class loser. Apparently it was too much for her that Joe Borg did not rip you apart on Bondi Plus. He must therefore be on the dark side since you are the devil incarnate.
She’s another one who doesn’t know how to count, or even understand the basics of an editorial process.
At least she didn’t call Fr Joe a ‘dog collar’ like she once called her (previous?) editor. She didn’t do so not out of respect to Fr Joe but because she mentioned the ‘good work’ Dun Gwann and Fr Michael are doing. Benoit asked why Father Avellino wasn’t invited on BondiPlus.
She wants the Curia to silence Father Joe Borg; she wants him to be sent away from here as a ‘lone ranger’, he is a university lecturer and knows the subject inside out; an expert.
The cause of the Iceland economic crisis was its banking system based on excessive loans http://en.wikipedia.org/wiki/2008%E2%80%932009_Icelandic_financial_crisis#Causes.
Although Iceland is now trying to join the EU and adopt the euro in order to have a stable economy, it is still deeply divided on the issue and the latest opinion polls indicate that the majority is against Iceland joining the EU.
I think that if Iceland was already in the EU at the time of the crisis, then it would still have suffered and the crisis would have affected all the European Union.
[Daphne – Please differentiate between the EU and the Eurozone. Britain is in the EU but not the Eurozone. It suffered a similar banking crisis, but because it is not as reliant on imports as Iceland is, its crisis has been largely its own, except where others are reliant on purchases made in sterling, as with Malta and tourism.]
I can’t get my mind around Muscat’s proposal to promise a free vote on divorce. What value does this add to those who would like Malta to have a law on divorce, unless he assures them that he would use an eventual majority of his government (hypothesising there could be one) to push that law through?
If he sticks to his promise, and we assume for a moment that the PN takes no position on the matter, nothing would bind a PN opposition from voting en bloc against the bill, and it will most probably not go through. What political project is that?
[Daphne – The PN opposition wouldn’t even have to use the party whip for a vote against. There are sufficient numbers of anti-divorce MPs on both sides of the house to derail a private member’s bill with a free vote. Muscat has said he hopes the PN will give its MPs a free vote on the matter (they would have the option of using the party whip, while Labour wouldn’t). What he would need from the PN opposition to get his private member’s bill through is a ‘whip’ vote in favour. But of course, he can’t demand that, can he – because he would be the one in government, asking the opposition to do the government’s job and legislate. Ridiculous.]
Let us keep the argument as clear and simple as possible:
1) Muscat is a twit.
2) We’re better off in the EU.
These facts stand regardless of Iceland’s status.
Back to the 20 year plan:
Mintoff wanted integration with Britain.
KMB ……erm………nothing.
Alfred Sant…..Switzerland of the Mediterranean.
Joseph Muscat….Iceland….with hindsight EU is fine by me.
JM must be another in a list of superior thinkers born out of Labour. Is it possible there is nobody suitable for the job among that lot?
Yes.
“Iceland, to an even greater extent than Malta, is dependent on imports for most of what its people use, wear, eat, drink and drive.”
I beg to differ: Iceland has more arable land (1,000km2) for a similar population size, had a big fish industry that was an income generator that they guarded fiercely even in the face of British warships. They invested in geo-termal power so almost independent in the energy sector.
http://en.wikipedia.org/wiki/Agriculture_in_Iceland
[Daphne – Oh for crying out loud: Wikipedia again, qisna tfal tal-iskola. Iceland has lots of arable land, yes, but do you know why the place is called Iceland? That’s right. It’s under ice for most of the year. And for six months of the year, daylight is merely fleeting, so two of the essential requirements for growing things – however much arable land there is – are just not present. Before fruit and vegetables began to be imported relatively cheaply from other parts of Europe – and I’m talking recent years here – Iceland’s population suffered the consequences of vitamin deficiency caused by lack of sunlight and lack of fresh fruit and vegetables in their diet. I have a friend who grew up in Iceland in the 1970s. She tells me that she and most of the other children at her school had bruising caused by vitamin deficiency and they all saw it as normal – the way I and my friends saw other forms of deprivation here in Malta as normal, I would imagine.]
If Malta’s economy failed like Iceland’s we’d be eating each other or be annexed by a neighbor. This makes Muscat’s original statement way more ludicrous.
Their current plight is relative: they had a $10k better GDP and will come out of this still with a better GDP than us, unless the ‘gubbermint’ comes out with a magic plan.
My biggest problem with magic plans is very subtle:
If Labour wins with a plan that sets fixed targets, then they will have to spend a lot of money we don’t have to achieve their goals. That will end up grinding the economy down come next downturn and we’ll end up with fantastic quality of life indexes but a crashed economy. Needless to say we are not self-sufficient enough to get out of the pickle.
The only restrainer I can hope for is the ECB raining down on the government to curb overt spending. From my limited understanding, the first Fenech Adami government was going this way and Sant reversed this (in my eyes he did something good you see?), then the next PN government went back to more responsible spending. I don’t know where we’d be if there wasn’t a change in policy in the first years of this century.
Joseph has to do the opposite of Gonzi and emphasize the team. He’s too fresh to do otherwise. I hope he shows us a good, honest and capable team come next election otherwise I’ll have no choice … yet again …
“Oh for crying out loud: Wikipedia again”
WikiEffingPedia is nothing but people’s (often wrong) opinions. If you like you can have a page saying Frans Sammut is the most brilliant author this planet of ours has ever seen.
The EU is good and bad for Malta. A bad aspect in these times is the inability to devalue the currency if needed and set interest rates at a level suitable to the Maltese economy rather than those of Germany and France. The Iceland situation was uncontrolled, but at least the cheap currency corrects the unsustainable spending and provides a road to recovery through exports.
The Maltese are still spending on their credit cards on imported flat screen TVs at the same time that the Euro controls the price, and makes uncompetitive, the main exports like tourism provision. The Euro enables Malta to borrow at a lower rate than it otherwise could and this is good, so long as politicians have the stomach to dampen deficit spending and property booms that result.
The good aspects are European disciplines and standards. Hopefully things like the National Bank saga will fall before the EU right to a fair trial in a reasonable time.