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Showing posts with label depression. Show all posts
Showing posts with label depression. Show all posts

4 August 2024

The difficult times for Finland's economy are coming to an end

Finland's economy has struggled since 2008. This is partly due to the fact that the global crisis at that time was preceded by Nokia's success as a mobile phone manufacturer, which led to an expansion of the public sector in hopes of scoring political points.

Then Nokia's glory days came to an end, and Finland was left with an oversized and expensive public sector relative to its income. However, dismantling it proved nearly impossible for the ruling politicians, as almost the entire population benefited from it.

The current Finnish government has started to address this problem, but the recent rise in interest rates has made the situation more difficult by increasing state expenditures just as public sector spending has been reduced. At the same time, the country's labor unions have opposed all changes, and the private sector hasn't recovered as hoped after the COVID-19 pandemic.

However, according to Finland's Ministry of Finance, there now seems to be light at the end of the tunnel. According to its top official, "price increases have clearly slowed down. Interest rates are on the decline, and the ECB is likely to lower rates two more times this year, which the markets have already priced in. The decline in GDP appears to have genuinely stopped, and there are signs of a revival in the housing market."

The official also praises Finland's "excellent" cost competitiveness, meaning the ability to produce goods and services at competitive prices compared to other countries. Additionally, alongside Nokia and the forest products industry, "new beginnings" have emerged in sectors like clean energy, artificial intelligence, and chip technology.

When you add to all this that the country has a right-wing government, which can be expected to refrain from redistribution policies, it seems that Finland is also emerging from its decade-and-a-half-long economic downturn.

28 January 2023

90 years ago in Germany

Exactly ninety years ago president Hindenburg of Germany nominated a new chancellor for his country. The name of the new leader was Adolf Hitler, who was the leader of the National Socialist German Workers' Party (NSDAP), that had a bit earlier become the biggest party in the parliament. 

After those developments a Dutch communist set on fire the Parliament building of the country which probably helped NSDAP to gain such popularity that in Elections in March the Nazi Party's share of the votes increased to 43.9 per cent, and the party acquired further seats in the Parliament. 

Thereafter Hitler was able to rise to a position of a true dictator of Germany via a "law to Remedy the Distress of People and Reich" with the help of the small Centre Party. Today it is politically correct to call all of this a mistake and a huge disaster to the whole world - which I believe we all agree on - and not to think about anything about the alternatives of that time.

In order to consider alternatives, we should understand that Hitler started his political life in the Weimar republic, established after the loss of Germany in World War I. That suffered on many problems before mid-1920´s, but the society settled by the end of the decade, until the Great depression changed everything.  

According to Wikipedia: "the National Socialist German Workers' Party (NSDAP), until then a minor far-right party, increased its votes to 19%, becoming Germany's second largest party, while the Communist Party of Germany (KPD) also increased its votes; this made the unstable coalition system by which every chancellor had governed increasingly unworkable. The last years of the Weimar Republic were marred by even more systemic political instability than previous years, as political violence increased."

And in another Wikipedia chapter: "from 1928 onwards (after Stalin reinstated Thälmann as KPD leader against the majority of the KPD central committee..., the party followed the Comintern line and received funding from the Comintern... the party was closely aligned with the Soviet leadership headed by Joseph Stalin; Thälmann has been described as ´the driving force behind Stalinization´... and ´Stalin’s right hand in Germany´. 

And somewhat later continues: "in February 1932, Thälmann argued that ´Hitler must come to power first, then the requirements for a revolutionary crisis [will] arrive more quickly´. In November 1932, the KPD and the Nazis worked together in the Berlin transport workers’ strike."

The question arising is: what was the alternative for Hitler in the Germany of 1930´s. Was it a democracy or was it a communist revolution supported by Josif Stalin. People of 2020´s probably think only about the first option, but in reality, it could as well have been a stalinistic Germany. 

What happened in early Soviet Union in 1930´s was not much different from what happened in Hitler´s Germany. People were massacred and both countries acquired military power. And it is also probable, that Stalin was planning on an attack towards the West in early 1940´s but Hitler started his operation Barbarossa before him. 

The question is that if such an attack would have occurred in collaboration with stalinistic Germany, would Western Europe have lost the war, and stayed under the occupation of Russian communists until the late 1980´s? And if so, would that have been better or worse than the German occupation for few years in 1940´s?
 
Naturally I have no answer to this question, because history is an invalid research topic where no repeated experiments can be organized. However, we may be happy to celebrate - instead the Hitler´s rise to the power 90 years ago - his loss of life in May 1945. And again, we can rejoice in the 70th anniversary of Josif Stalin's death on the fifth of March, just a bit more than a month from now.