POLITICAL PACKAGES (2)
The growth package announced on Tuesday by the Danish Government foresees economic growth of 1.3% pa from now to 2020. The growth figures for 2012 announced this morning show just how difficult that is going to be to achieve.
The economy shrank by 0.6% in 2012. Even worse, the anaemic growth of the summer was replaced by a fall of 0.9% in the last quarter. Which means that the Government is starting its growth package with an economy in reverse gear. Even the Government's supporters had difficulty reconciling these two things on the news programmes, and were reduced to calling the growth target "challenging, but possible".
I would call it unrealistic. Since the crisis began in 2008, the Danish economy has shrunk by 4%. True, this is better than the 7.5% experienced in Italy. But it compares very badly with the 2% growth in Germany and 6% in Sweden over the same period. These are Denmark's neighbours and biggest trading partners, and they are doing a lot better. The growth package is a good thing for Danish companies, but it is not going to get Denmark back onto the right track. More is needed.
Walter Blotscher
Thursday, 28 February 2013
Wednesday, 27 February 2013
GAME OF THRONES
My wife is in Belgium this week on a school exchange, so it is just my son (he of handball fame) and I at home at the moment.
Life has become very male, meaning lots of premier league and F.A. cup football on the television, and rudimentary cooking. Plus he has introduced me to Game of Thrones, the HBO blockbuster now about to show its third season. I had never seen it before, but my enterprising son has managed to illegally download the first five episodes onto his computer, so that his dad can watch them. Only another fifteen to go and I'll be up to date.
Walter Blotscher
My wife is in Belgium this week on a school exchange, so it is just my son (he of handball fame) and I at home at the moment.
Life has become very male, meaning lots of premier league and F.A. cup football on the television, and rudimentary cooking. Plus he has introduced me to Game of Thrones, the HBO blockbuster now about to show its third season. I had never seen it before, but my enterprising son has managed to illegally download the first five episodes onto his computer, so that his dad can watch them. Only another fifteen to go and I'll be up to date.
Walter Blotscher
Tuesday, 26 February 2013
POLITICAL PACKAGES
It's a recent trend that changes in Danish political life are presented as "packages", a bit like at Christmas. Last week there was an S.U. package, and yesterday there was a "kontanthjælp" package, a proposal to change (i.e. cut) the transfer income paid to the worst off in society. Today it was the turn of a "growth" package, designed to kickstart the economy and create jobs.
Denmark has lost roughly 170,000 private sector jobs since 2008, all of them well-paid (by European standards) and nearly all of them destined never to return. The Government had hoped that by now, the economy would have climbed out of the trough into which it had sunk, but that has not happened. A number of Danish companies are making a lot of money; but that money is being made abroad and is not being translated into new jobs at home. When combined with the disastrous aspects of the Danish fiscal cliff, something had to be done.
The core of that something is a cut in corporation tax from 25% to 22%, the dropping of a number of planned burdens on business, plus Dkr.4 billion to be spent on renovating buildings. This will be financed by reducing the planned growth of the public sector from 0.8% to 0.4% and holding it on a tight rein for the next seven years, plus savings generated by the other reforms outlined above. All in all, the Government expects the measures to produce 150,000 new jobs by 2020, which is roughly the amount that have been lost during the crisis.
There are however two big problems with the package. First, there is a good deal of scepticism about that prospective job figure. The measures will undoubtedly make Danish companies more profitable. But as noted above, more profitability does not necessarily translate into more Danish jobs. Secondly, and more immediately, the package creates a political problem. Basically, it involves taking money from some of the least well-off in society (students, those on the dole, people reliant on public services) and giving it to companies. Standard stuff for a right-of-centre Government; eventually those companies will generate more jobs and wealth. But this is a left-of-centre coalition, that was elected on the premise that Danish welfare could, and would, be maintained. The people that voted for that coalition have already begun to howl, and look set to continue to do so.
It's a recent trend that changes in Danish political life are presented as "packages", a bit like at Christmas. Last week there was an S.U. package, and yesterday there was a "kontanthjælp" package, a proposal to change (i.e. cut) the transfer income paid to the worst off in society. Today it was the turn of a "growth" package, designed to kickstart the economy and create jobs.
Denmark has lost roughly 170,000 private sector jobs since 2008, all of them well-paid (by European standards) and nearly all of them destined never to return. The Government had hoped that by now, the economy would have climbed out of the trough into which it had sunk, but that has not happened. A number of Danish companies are making a lot of money; but that money is being made abroad and is not being translated into new jobs at home. When combined with the disastrous aspects of the Danish fiscal cliff, something had to be done.
The core of that something is a cut in corporation tax from 25% to 22%, the dropping of a number of planned burdens on business, plus Dkr.4 billion to be spent on renovating buildings. This will be financed by reducing the planned growth of the public sector from 0.8% to 0.4% and holding it on a tight rein for the next seven years, plus savings generated by the other reforms outlined above. All in all, the Government expects the measures to produce 150,000 new jobs by 2020, which is roughly the amount that have been lost during the crisis.
There are however two big problems with the package. First, there is a good deal of scepticism about that prospective job figure. The measures will undoubtedly make Danish companies more profitable. But as noted above, more profitability does not necessarily translate into more Danish jobs. Secondly, and more immediately, the package creates a political problem. Basically, it involves taking money from some of the least well-off in society (students, those on the dole, people reliant on public services) and giving it to companies. Standard stuff for a right-of-centre Government; eventually those companies will generate more jobs and wealth. But this is a left-of-centre coalition, that was elected on the premise that Danish welfare could, and would, be maintained. The people that voted for that coalition have already begun to howl, and look set to continue to do so.
Walter Blotscher
Monday, 25 February 2013
THE OSCARS (2)
I don't watch the Oscar award ceremony, it's just too painful. But I do have an interest in the outcome, not least because of the effect it might have on the local cinema. In the next batch of eight films, we are showing Lincoln, Django Unchained, Zero Dark Thirty and Les Miserables, all of which were nominated for, and won, Oscars. Since all four are non-Danish, we rely a fair amount on publicity to generate local interest, which the Oscars provide. Whether it will be enough to get the locals - other than me - in to watch an almost three-hour long Quentin Tarantino spaghetti western remains to be seen.
One film we got wrong was Operation Argo, which we showed in the first week of January and which last night won the award for best picture. I think the timing was not right. After the Christmas and New Year binges, I think that people are rather sick of spending money. Perhaps we should have opened between Christmas and New Year and shown it then instead.
Walter Blotscher
I don't watch the Oscar award ceremony, it's just too painful. But I do have an interest in the outcome, not least because of the effect it might have on the local cinema. In the next batch of eight films, we are showing Lincoln, Django Unchained, Zero Dark Thirty and Les Miserables, all of which were nominated for, and won, Oscars. Since all four are non-Danish, we rely a fair amount on publicity to generate local interest, which the Oscars provide. Whether it will be enough to get the locals - other than me - in to watch an almost three-hour long Quentin Tarantino spaghetti western remains to be seen.
One film we got wrong was Operation Argo, which we showed in the first week of January and which last night won the award for best picture. I think the timing was not right. After the Christmas and New Year binges, I think that people are rather sick of spending money. Perhaps we should have opened between Christmas and New Year and shown it then instead.
Walter Blotscher
Sunday, 24 February 2013
A BIG FIRE
With all of the work involved in building the back lawn and pruning the orchard, a huge compost heap has built up in my my garden. Compost heap is in fact a bit of a misnomer, since it is mainly wood, not compost; thin sycamore trees, the parts of felled fruit trees that are too small to be used in the wood-burning stove, last year's Christmas tree etc etc. We are talking of a pile roughly 10 metres long by two wide by two high.
Today I decided to burn it. I want to do it before the trees around it start to blossom, since the smoke is not good for them. It has also been dry for the past week or so, though bitterly cold. And there was a wind, which I thought would help.
I thought wrong. After six hours of trying, and copious amounts of petrol, I have managed to burn roughly one square meter. I will have to try again another day.
Walter Blotscher
With all of the work involved in building the back lawn and pruning the orchard, a huge compost heap has built up in my my garden. Compost heap is in fact a bit of a misnomer, since it is mainly wood, not compost; thin sycamore trees, the parts of felled fruit trees that are too small to be used in the wood-burning stove, last year's Christmas tree etc etc. We are talking of a pile roughly 10 metres long by two wide by two high.
Today I decided to burn it. I want to do it before the trees around it start to blossom, since the smoke is not good for them. It has also been dry for the past week or so, though bitterly cold. And there was a wind, which I thought would help.
I thought wrong. After six hours of trying, and copious amounts of petrol, I have managed to burn roughly one square meter. I will have to try again another day.
Walter Blotscher
Friday, 22 February 2013
DEFENCE SPENDING (2)
They have been putting it off for some time, but now Danish politicians have to decide exactly which military bases they are going to close, in order to achieve the Dkr.2.7 billion of savings in the defence budget to which they have already signed up.
The Chief of Staff has recommended the closure of barracks in Fredericia, Haderslev and Sønderborg (all in southern Jutland) and on the island of Bornholm, plus one on Zealand, either Vordingborg or in the neighbourhood of Copenhagen. The latter is likely to escape, since it services the life guards who in turn support the monarchy. Probably sensible militarily, but it hands the politicians a hot potato. Because all of the bases scheduled for closure are in "udkants" (out-in-the-sticks) Denmark, which already had the view that people in the big city were ignoring it, and which now has the evidence to prove it.
And so there has been a stream of local politicians taking the train up to Copenhagen, armed with economic arguments about how important military bases are to the local community (true) and long lists of signatures supporting their staying open. Whether it will have any immediate effect is a moot point. However, whatever the Government decides, there will be a reaction in November. There are local elections then.
Walter Blotscher
They have been putting it off for some time, but now Danish politicians have to decide exactly which military bases they are going to close, in order to achieve the Dkr.2.7 billion of savings in the defence budget to which they have already signed up.
The Chief of Staff has recommended the closure of barracks in Fredericia, Haderslev and Sønderborg (all in southern Jutland) and on the island of Bornholm, plus one on Zealand, either Vordingborg or in the neighbourhood of Copenhagen. The latter is likely to escape, since it services the life guards who in turn support the monarchy. Probably sensible militarily, but it hands the politicians a hot potato. Because all of the bases scheduled for closure are in "udkants" (out-in-the-sticks) Denmark, which already had the view that people in the big city were ignoring it, and which now has the evidence to prove it.
And so there has been a stream of local politicians taking the train up to Copenhagen, armed with economic arguments about how important military bases are to the local community (true) and long lists of signatures supporting their staying open. Whether it will have any immediate effect is a moot point. However, whatever the Government decides, there will be a reaction in November. There are local elections then.
Walter Blotscher
Thursday, 21 February 2013
THE 2012 PROJECT (5)
Endless days with sub-zero temperatures mean that there is not much to be done in the garden. Except two things.
The first is bagging the odd mole that dares to come up to the surface. I got another one this morning.
The second is continuing with the 2012 Project, which is to knock the orchard into shape. Last year I cut most of the large trees half way down. Now I am cutting them right down to the ground, in the hope that they will shoot again, once the temperature is positive. It's set to stay frozen for most of the next week, so if I do a tree a day, I should be finished by the end of this month.
Walter Blotscher
Endless days with sub-zero temperatures mean that there is not much to be done in the garden. Except two things.
The first is bagging the odd mole that dares to come up to the surface. I got another one this morning.
The second is continuing with the 2012 Project, which is to knock the orchard into shape. Last year I cut most of the large trees half way down. Now I am cutting them right down to the ground, in the hope that they will shoot again, once the temperature is positive. It's set to stay frozen for most of the next week, so if I do a tree a day, I should be finished by the end of this month.
Walter Blotscher
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