Making sense of the UK's EU referendum

With only a day left until the EU referendum, it’s more important than ever to be well-informed. Therefore, we have put together an easy-to-read overview of the major issues at stake. We have looked through both pro-Remain and pro-Brexit arguments in newspapers, expert opinions and political statements and digested them for your convenience. Given our belief that the state should look after its people, particularly ordinary citizens, we have tried to look at the debate by keeping in mind what would be in the best interests of the common man.

Norway’s Sovereign Wealth Fund Faces Big Risks from Tax Havens

The Panama Papers sparked a loud, but rather limited debate on the Norway’s Sovereign Wealth Fund and its use of tax havens. Here we present some new facts, discuss what risks the Fund really faces and suggest concrete steps for reform.

Taken together, the Oil Fund’s direct investments in tax havens amount to as much as 8%-10% of its total value. These include its investments in real estate through subsidiaries in Luxembourg and Delaware, fund managers who use tax havens and direct stakes in companies registered offshore.  Most discussions so far have focussed on getting the Fund to reduce or eliminate this kind of direct use of tax havens.

While this is important, the largest financial, reputation and ethical risks for the Fund arise indirectly from its investments in companies that use tax havens and aggressive tax avoidance strategies.

#ThisIsNotACoup - Dispelling some myths about the Greek agreement

The media is abuzz with hyperbole calling the Greek agreement to work toward a deal “humiliating”, “capitulation”, “surrender” or worse, “a coup”.  Weighty names such as Nobel Laureates Krugman and Stiglitz have also endorsed the #ThisIsACoup hasthtag that has been trending on Twitter.  The idea behind all of these is the supposed “near total” loss of Greek sovereignty. In particular, the idea that Greek public assets would be handed over to an agency under EU supervision for privatisation has provoked particular fury. Another idea that is doing the rounds is that the creditors exacted revenge for Tsipras having dared to call a referendum. The statement that the conditions under the new programme are much harsher than what was on offer has been repeated ad infinitum.

The third narrative floating around is one that holds Syriza and Tsipras primarily responsible for Greece’s current problems. The Eurogroup statement, for example, seems to blame doubts about debt sustainability primarily on the failure of Greeks to implement policies over the past few months. A particularly pernicious version of this is the politically tone-deaf and highly unprofessional tweet from Peter Kazimir, the Slovak Finance Minister, who said the agreement was tough for Athens because of their “Greek Spring”.

Why Greece never got a fair chance

On pure economics, Syriza got it mostly right both in terms of the diagnoses of the crisis and on what micro and macro level steps were needed to restore the Greek economy. But its big mistake was to assume that economic arguments could prevail over ideology and realpolitik. Another was its failure to convince its Eurozone counterparts that it would actually deliver on the promises it made. While Syriza could be excused for its naiveté’, its creditors get no such free pass. Their unwillingness to admit mistakes, keep promises for further debt relief and focus on petty parochial politics has once again trampled upon Greek democracy and sensible economic policy, and caused great harm to the European Project.

Unless they are willing to give Greece a fair chance over the next few days, the damage will be irreparable. And it is not just Greeks who will have to live with the consequences.

The Greek Deal – A game changer or a mere name changer?

Followers of Re-Define’s recent publicly available work on Greece will know that: 1) we thought Syriza’s election was good news both for Greece and for the EU 2) there would be a lot of noise and bluster, but that a compromise would eventually result, 3) the risk was always negligible and that of an “accidental” exit was zero, despite numbers such as 75% risk of Grexit pulled out of what can only be thin air by various “experts”, 4) Syriza deserved to, and probably would get a chance to, prove its mettle. 

Mercifully, it appears that we have been right, at least so far. The Troika, as we knew it, is dead.

Now that a “deal” has been reached, what do we make of its terms? Is it, as many are saying, “total capitulation” by Greece? A mere “name changing, not game changing” exercise? Or, is it something more substantial? Most important, does it leave Greece and the Eurozone better off?

There is something to the accusation, as articulated by Manolis Glezos, a respected Syriza MEP best known for having torn down the swastika from the Acropolis in 1941, that all that has happened is that the new euphemism for the Troika is “institutions”. Syriza tried, but has failed so far, to get the OECD more deeply involved, particularly at the cost of the ECB and the European Commission. But more has changed than meets the eye. Syriza can only claim some of the credit for the changes.