Financial markets await nervously – as is their modus vivendi - what will happen in the Ukraine. President Putin has some inside information about what he intends to do, and we may wonder whether he has used this inside information to take a position in Wall Street or London, via intermediates, to strike it rich when he comes into action. It is difficult to imagine that he and his inner circle will earn nothing.

A weblog like this can only watch but we can at least shortly focus on nothing.

Imagine Euclidean space: it is totally empty, it is the pure nothing. We don’t need a Big Bang to create Euclidean space. If we fill Euclidean space with objects then we can do so only with imaginary objects and hence it remains empty. We can imagine lines but the width of a line is zero so in a sense it doesn’t exist either. By contrast, physical space is filled with quantum fluctuations and gravity fields and so on. The seeming emptiness of the sky may inspire the idea of Euclidean space but there remains an important difference.

Most philosophers have had inadequate mathematical training and struggle with their concepts. For example figures like Hegel, Heidegger and Sartre got lost in language games about “nothing”. The word “nothing” means to express that something doesn’t exist but philosophers think “when a word exists then it can only have meaning if it refers to something”. Thus if there is nothing then there still is something, e.g. nothingness - and other curious constructions like that. The wikipedia page on “nothing” is quite amusing.

It were philosophers like Alfred Ayer and Ludwig Wittgenstein (not of the Tractatus but later of the Philosophical Investigations) who advised to deconstruct events and to analyse the language games played. The meaning of words is their use. Provided that the word “nothing” is used in a practical manner, to support the use of models for reality, then the philosophical nonsense collapses.

Kitaro Nishida wrote the book Logic of the Place of Nothingness and the Religious Worldview. See also the Kyoto School and the Stanford philosophical page by Bret Davis. I am afraid that Nishida fell in the trap of the syllogism: “Everything that exists has a place. Nothingness exists. Thus nothingness has a place.” This is my interpretation. His own words are a curious mixture of abstraction and empty language constructs.

It is mathematical parlance to say that “there is a point of intersection” but if the intersection occurs in Euclidean space then this existence is only a figure of speech. In the same way “nothingness” might perhaps have a place in some abstract way of expression. But with Euclidean space there are rather strict rules how to translate results to reality via engineering, while there are no such conventions with such philosophical texts.

It is said that Nishida was interested in ways to integrate Western and Eastern ways of thought, and then it is a pity that he started with Hegel and Heidegger, whose texts tend to absolve into nothing when deconstructed.

The article by Bret Davis is informative but also somewhat confusing. He holds that Buddhism is an Eastern philosophy. But its original texts are in Sanskrit and we know that this is Indo-European and thus there are common roots. Kristofer (Rik) Schipper has explained that Dao is the original Chinese philosophy while Buddhism was imported in China and Japan. Schipper also clarifies that Lao Tzu gave the original approach in Dao that is still relevant for the current majority of the population, while Kung Fu Tzu generated a version for the court of the emperor that is authoritarian and only popular in such circles. If you want to understand China, read Schipper.

Dao is inherently ironic. It has elements that remind of Ayer and Wittgenstein in terms of deconstructing language games to show the futility of claims of knowledge. Dao has rituals but those are primarily provided to give people a way to express that they understand that those are mere rituals and otherwise meaningless. A Dao master can be like a skeptic Socrates who may refuse to speak or then ask teasing questions, and who performs the rituals to teach the onwatchers that he has perfected a quite meaningless ceremony. You do, to show that you don’t.

In a key passage, Davis nicely states: “The latter sense of wu is expressed in chapter 40 of the Laozi (Daodejing) as follows: “The myriad things under heaven are generated from being. Being is generated from Nothingness (wu).” This unnam[e]able non-dualistic source of all being and relative non-being is also referred to as the Way (dao).” Relative is how yin and yang are required to create unity, but the whole should have come from a pure nothing.

Wikipedia distinguishes Dao from Shen Dao, where the latter would be the folk belief comparable to Japanese Shinto. If I understand Schipper correctly, this would not be proper. Dao wouldn’t really differ from Shen Dao, since the shen (heavenly spirits as opposed to those from the earth) would be present in both. It is a confusion amongst Western researchers on religion that they are looking for gods who are worshipped. It is nonsense to put such gods in center place since of relevance is the path. Original Chinese philosophy / religion / way of life can best be regarded as a soup, and whoever takes a spoon or sip, will taste something different.

Some mystics suggest that Lao Tzu already anticipated the Big Bang. There is a simpler explanation. Lao Tzu had two logical options: either an eternal existence of some substance(s) or a creation out of nothing. Clearly there is no way to know, in say 300 BC (and likely today too). Eternal existence comes with all kinds of questions of what has been happening and whether there really wasn’t some kind of beginning. Creation out of nothing has the nice property that it is quite ironic. The Dao master is the court jester: “Everyone will understand that I cannot know what happened but everyone will also understand that creation out of nothing has the nice property that the story starts somewhere. The children will be happy with this story and when the children are happy then everyone is happy.”

Students of the economics dept. of the University of Amsterdam organised a Room for Discussion (RFD) about the “basic income”. This should rather be called a benefit since one gets money from the state for free. This is the video (1 hour and 6 minutes). The moment was well chosen since a day later there was a conference of Unconditional Basic Income Europe (UBIE) that collected some 285.000 signatures from all across Europe for such an initiative. (We are also reminded of How much is enough? by Robert and Edward Skidelsky.)

One discussant in Amsterdam was Guy Standing, professor in Development Studies at SOAS (University of London) and one of the founders of the Basic Income Earth Network (BIEN). I am a sort of fan of Standing because of his 1988 ILO study on Sweden, that is in the literature list of my book DRGTPE. (And a fan of Robert Skidelsky too, see DRGTPE again.)

Check at minute 45:30+ how Standing explains that there is a world crisis in low paid and insecure jobs with a new underclass that he calls “the precariat“. Standing accuses the political parties of not having a solution, and especially the leftist parties such as Labour who should be concerned on this. I tend to agree with the diagnosis on the disadvantaged and I also agree with much of his analysis: but not on the whole.

The other discussant was Paul de Beer, professor at the University of Amsterdam and scientifc director of De Burcht, a research institute for the labour unions. De Beer was/is also involved in BIEN (he was at the first BIEN conference in 1986). He is a proponent of the basic income as well, though he has learned to downplay it for established welfare states so that he advises it for developing countries that don’t have an established welfare state yet.

De Beer has also been involved since 1982 in the Wiardi Beckman Stichting (WBS), the “scientific bureau” of the PvdA, the Dutch Labour Party. Clearly, Standing’s accusation w.r.t. Labour should hit at De Beer. The accusation doesn’t quite hit because De Beer tends to agree on the basic income and he could wash his hands that it are the Labour politicians who don’t want it.

Let us compare a basic benefit and full employment:

  1. The basic benefit is irrelevant for those with a higher productivity. You still need complex arrangements such as unemployment protection for 90% of the labour force. A person who has invested in a profession and job cannot be compensated by merely a basic benefit.
  2. The basic benefit is relevant at the subsistence level. But here issues are complex too. Simply giving people money is not necessarily the right approach. A basic benefit is said to be simpler, but what if someone makes debts and his means drop below subsistence ? You still need surveillance. What if someone has an address in various countries and collects various national basic benefits ? You still need international checks. What with cheap housekeepers from the Philippines ? They are used to a lower subsistence and the houseowner can keep a part of their new higher basic benefit in the rich countries. And so on. It is not simpler. It is different.
  3. The basis benefit does not solve unemployment fully. You still need national investment banks. You still need an Economic Supreme Court to correct for failing democracy. And so on. See DRGTPE.
  4. An alternative is to return to full employment. Allow workers to start working and then we can see from there. My advice is to first eliminate the tax void. This can be done for free and generates most of the advantages. We can see whether we want a basic benefit subsequently. See the table below.

If the current situation is called Amsterdam and abolition of tax void is called Brussels, then the train ride from Amsterdam to Brussels is for free. Let the basic benefit be called Paris. The train ride from Amsterdam to Paris implies partly a train ride to Brussels. Thus the basic benefit implies the abolition of the tax void. But the final stretch to Paris will be expensive, e.g. handing out benefits to housekeepers.

“Amsterdam” “Brussels” “Paris”
Present situation Abolish tax void Basic benefit
Unemployment & benefit burden Free of costs, less unemployment Costly, still unemployment

The cost-benefit analysis (CBA) should be done properly. Proponents of the basic benefit assign positive effects to the basic benefit that however should be assigned to the abolition of the tax void. Dutch readers are referred to Wat stampen we lekker, zegt Muis (1994), also available in Trias Politica & Centraal Planbureau (1994). In terms of effects, the Elephant is the abolition of the tax void and the Mouse is the introduction of a basic benefit. Mouse says: “Aren’t we pounding greatly ?”

Let me explain the manipulation by Paul de Beer:

  1. In 1990 when I presented my new analysis on unemployment, with the possibility to return to full employment, it was not only blocked from discussion at the Dutch Central Planning Bureau (CPB) (resolution of which is the objective of this weblog, see the about page), but it was also blocked from discussion at the WBS, and Paul de Beer was secretary of the blocking committee.
  2. De Beer does not protest against the censorship of science by the directorate of the CPB. I cannot remain a member of a party PvdA that blocks discussion of my scientific analysis and that doesn’t ask questions in parliament about censorship of science by the national government. I am a modest person and I am sure that my analysis is not all that there is, but it seems warranted that the views of the social democratic parties that are now failing could have been affected if they had had a chance to get to understand my analysis.
  3. De Beer must have been misleading Guy Standing at BIEN since 1990 since otherwise Standing would not write as he does.
  4. De Beer clearly has been misleading the Dutch branch of BIEN (“vereniging basisinkomen“).
  5. De Beer clearly misleads the students at Room for Discussion as everyone can verify that he does not mention my analysis in that video. He could have done so out of mere politeness, since I was present and you can see my shoes on the video. But he should have done merely from content. Full employment is a good alternative to a basic benefit. After he had misled the students they gratefully gave him a bottle of wine.
  6. On October 14 2005 there was a small conference organised by the Dutch Labour union FNV and De Burcht, with speakers myself, Paul de Beer and tax professor Leo Stevens (Rotterdam), see the press release. Monitors were FNV chairman Henk van der Kolk and PvdA senator Han Noten. Reactions were given by financial spokespeople for the parties in parliament, notably Stef Blok who is now a cabinet minister. This would have been an excellent place for a discussion on the advantages of abolishing the tax void. But De Beer neglected all that I said and concentrated on a discussion with Stevens. Also Stevens neglected what I said, but that is not the point here.
  7. In December 2013, the Royal Dutch Society for Political Economy (KVS) published a research booklet on labour relations, edited by De Beer. When the topic was selected in December 2012, I informed Paul that the crisis confirmed my analysis, and that I could contribute a paper on the resolution of unemployment, where I provided a link. He did not react. See the result: a misleading document (in Dutch).

Whenever I meet people who are in favour of a basic benefit and I present the counterarguments, it turns out that they are not willing to reconsider their position. Apparently there are strong elements of ideology here. They rather advocate a basic benefit while it will not be introduced quickly, and while I have shown an alternative that will work and has a chance of adoption: full employment. These ideologues do not protest against the censorship of science either.

This may also have played some role at the CPB in 1990. It appeared later that director Gerrit Zalm was in favour of a basic income, as the CPB study Scanning the Future (1992) contains a scenario with a basic benefit. Zalm follows Milton Friedman here. The basic benefit would be at subsistence (as low as possible) and the remainder of the welfare state could be abolished. See Scanning the Future p205 for the “balanced growth” scenario, while this scenario in Nederland in Drievoud (1992) p24 has an explicit negative income tax. When he later became minister of Finance, Zalm replaced tax exemption by a tax credit, with the political idea in mind that this could be developed into a basic benefit. However, he used a deliberate lie to get this change accepted, see the paper Economics as victim between lawyers and mathematics: An explanation for the tax credit, Bulgarian potential fraud, European unemployment and the economic crisis (2013).

Thus, basic-benefit-proponents claim to advance the cause for the disadvantaged, but in fact they block an analysis that would really help those. This concerns one billion people on the planet. Do we see pure evil here or not ?

Don’t censor science – is that so difficult to understand ?

The president of the Bundesbank Jens Weidmann came to Amsterdam on invitation by the president of the Dutch Central Bank Klaas Knot. The German Institute (DIA) of the University of Amsterdam organised a small conference where they presented their views and answered some questions from the audience. We can find Weidmann’s speech at the Bundesbank website.

Weidmann recalled that Amsterdam had been built on piles (poles) and then jumped to monetary stability: “But I am positive that if we learn from the sovereign debt crisis and do not falter in our efforts to push enough piles into the right parts of that tricky ground, the European monetary union can be preserved as a place of stability that is worth living in.”

A key point is that the ECB statute is targetted at controlling inflation. In the onslaught of the crisis since 2007 the ECB got an additional role in maintaining financial stability and preventing collapse, like with the supervision of the European Banking System (see the alphabet soup), but the Bundesbank considers it advisable that the ECB returns to its original role for stable money. A new Treaty is required, with a rejuvenated ECB and a new authority for monitoring the financial sector.

Thus, in a curious way, Weidmann suggested that he was irrelevant to talk to. Just let the ECB / Bundesbank manage inflation, forget about their existence, and talk to other people when you want to discuss financial stability. Having said this, didn’t stop Weidmann however in making his comments on monetary and financial stability.

A key point is that Basel III would need to be revised. Government debt is handled in the regulatory framework as risk free while the markets assign risks. See this report by Bloomberg 2011, when it was already an old issue. This weblog reported in 2012 about the visit of professor Bofinger to Amsterdam, who rejected that government debt could default since that would be some kind of bailout. Apparently there is little enthousiasm amongst regulators for amending Basel III, in particular amongst most countries other than Germany and Holland who would lose their risk free status. Weidmann turned on the screws however. He mentioned France as a “core country” that fails in its structural reforms and ought to suffer the consequences. In my impression Basel, Bofinger en Weidmann are stuck in a logical conundrum. I refer to my earlier paper for a solution approach Conditions for turning the ex ante risk premium into an ex post redemption for EU government debt.

Naturally the juridical status of the OMT came up, as it also was mentioned in an earlier weblog entry here. A professor from Leiden asked Weidmann whether he hadn’t put the authority of both the Bundesbank and the Bundesverfassungsgericht at stake, by voting against the OMT and publicly speaking out against it. “We are not lemmings,” Weidmann answered. In terms of their fear for inflation Germans actually are like lemmings, but obviously he has a good point that Germany shouldn’t be asked to pay for what other nations squander, and obviously OMT is a curious construct while there are much better approaches, see my Economic Plan for Europe and paper Money as gold versus money as water.

The joker of the afternoon came in the person of former EU commissioner Frits Bolkestein. He wondered whether Southern Europe should not take a vacation from the Euro, return to their original currencies, re-establish competitiveness, get some help in doing so, and then apply for the Euro again. He glossed over a question like how to handle the debt that is denominated in Euro’s. Weidmann and Knot remained polite and gave the obvious answers. A monetary union exists by stability and not a revolving door. Financial markets would sniff out potential departures and the speculations would force them. Bolkestein’s idyllic vacation is a recipe for economic chaos.

Bolkestein about a Southern European Vacation

Bolkestein (below right) asks about a Southern European Vacation from the Euro

PM. A Dutch report by DIA is here. The text by Klaas Knot is here.  Here is an interview with Weidmann on Dutch national television – in German with Dutch titles. The closing statement by Weidmann is that we can already see the light at the end of the tunnel. In my analysis he can only point to a small air vent that also leaks some light. We will not suffocate before we die from starvation.

The heat on the Ukraine and Crimea is rising. A common sense commentary was by Tariq Ali (Guardian March 28) but it seems that many are losing their interest in common sense. It is curious that we are commemorating the origins of World War I and paving the way for events that future generations may need to commemorate – if those survive the potential nuclear onslaught. Indeed, at the Nuclear Security Summit in The Hague March 24-25 the Chinese communist leader Xi Jinping was welcome, regardless of the Tibet issue, while it was felt necessary to evict Russia from the G8. Can someone explain this folly ?

Perhaps the EU should embrace Serbia and launch it into the diplomatic first seat ? Perhaps Russia would be willing to listen to what Serbia has to say, if Serbia still thinks that joining up to the EU is a good idea, that is. Perhaps a theatrical re-enactment of the shooting of crown-prince Franz Ferdinand will help to get matters into focus, though Sarajevo is no city of Serbia anymore.

The heat is also rising in Holland. Historian / journalist Wierd Duk (pronounced as Weird Duck) published a small biography on Putin in which his macho image is emphasized. An issue in the book is also whether Putin’s parents are his true parents. See the macho book cover (“Street fighter (hooligan) threatens the world order“) and see the interview on national Dutch television. Publishers and writers need to sell and nothing sells as well as throwing oil onto fire.

Wierd Duk, “Putin”, book cover

Historian / journalist Wierd Duk comes across as an amateur. If you want to set things on fire, rather follow Marinus van der Lubbe and do it on a serious scale.

Since we are still close to April 1, let us look deeper into the issue whether Putin’s parents are his real ones. Indeed, wikipedia gives us the story of Vera Putina. Her story can be put in the proper historical context. A further search on the internet allows us to put the following story together.

When Kaiser Wilhelm II visited his English relatives, he preferred to travel via Flushing (google). One of the maids of service in Holland was Petronella van Haandel, a young and attractive lady, though she already had four children from colonial officer Van Peuthe. In 1904 Petronella remarried Franciscus Cornelis van der Lubbe, a travelling salesman. Marinus van der Lubbe is officially their son, but it can be assumed that actually Kaiser Wilhelm is his illegitimate father, from seeing his mother (again) on a train ride in 1908. At the end of World War I in 1918, Kaiser Wilhelm was evicted from Germany, and landed in The Netherlands again, now in the estate of Doorn. On the internet there survive films of him chopping wood.

When his mother had died in 1921, Marinus went visiting his father more often. At the early age of 17, Marinus met in Doorn with the beautiful Grand Duchess Kira Kirillova of Russia also 17 years. They had a passionate love affair, as youngsters can have, and soon Kira gave birth to a cute daughter Vera (“truth”). Kaiser Wilhelm was distressed, banned Marinus from his Doorn estate, and had his grandson Louis Ferdinand quickly marry Kira, while Vera was put into adoption by a Russian cook called Spiridon Ivanovich Putin.

In 1934 Marinus went to Berlin and set fire to the Reichstag, perhaps hoping to win back the love of his father. It is claimed that Marinus van der Lubbe was a communist but he actually said: “Kom, moe, nu is het !”, which may be translated as “Come, mom, now it is (for you).” Here we find an endearing picture of Kaiser Wilhelm and Kira making amends, since Kira now was happy that she was with Louis Ferdinand rather than Marinus.

In 1949 Vera came to visit her mother for Christmas and to everyone’s dismay Louis Ferdinand couldn’t control himself and impregnated her. Louis Ferdinand had always been envious of the Dutch flings by his grandfather with Petronella and by his father with Mata Hari and thus he regarded Vera not merely as his Christmas present but rather as his Dutch destiny. Their child was called Vladimir, after Kira’s brother Vladimir Kirillovich (1917-1992), who was the head of the Romanov family and heir to the Russian throne.

To resolve everyone’s embarrassment, Vera was married off to a Georgian soldier Giorgi Osepahvili. Young Vladimir was given a new birth year 1952 and attended school in Georgia 1959-1960, but was then dispatched to his “grandfather” Spiridon in Leningrad and subsequently adopted by his “uncle” Vladimir Spiridonovich Putin. The latter story now is the official biography of Vladimir Putin while his true mother Vera Putina has a horrible life in explaining to everyone what the actual truth is. Kira herself could not live with the disgrace and eventually committed suicide on an overdosis of sugar, and her last words were: “God forbid I should eat anything healthy!”

It may also be mentioned that Vladimir was a KGB-agent in Dresden, East Germany, in 1985-1990, and that the German government after the fall of the Berlin Wall in 1989 put him onto a train back to Russia, with a couple of wagons loaded with gold to allow him to finance his ascendancy to power, in a replay of what Germany did with Lenin in 1917.

Vladimir Putin's family tree

Vladimir Putin’s family tree

Now, if the above is true, then Vladimir Putin is not only a bastard in the proper sense of being an illegitimate child but also the product of incest since, if you have been keeping track, Louis Ferdinand and Vera have the same grandfather, Kaiser Wilhelm II. Though Putin would have ample reason to be proud of his regal roots one can also understand why the Kremlin pushes for the official biography.

Just to be sure: above story is not in the Wierd Duk book. It is just an example of what politicians and historian / journalists can generate if they persist in their folly, even outside of the sacrosanct realm of April 1.

I was amazed how grateful Manny was. Over lunch in the Brussels Belvedere, Jose Manuel Barroso looked like a puppy who had proudly peed for the first time on schedule. “The Americans gave me this Google Glass out of gratitude,” he showed happily. “Of course I should give it on to you since you actually published the piece, but I presume you allow me to keep it. Pretty soon the whole EU Commission will have it, and I need to take the lead. My wife says that my eyes make weird movements when she finally succeeds in taking it off me. I suppose she hadn’t noticed that my eyes did so anyhow.”

“I probably wouldn’t mind if the EU Commission all got Google Glass, especially for the official state picture,” I admitted. “It might come across a bit like the X-men or the Men in Black. But I would be more worried about the programs they are running. Did you look into that ?”

“Not yet. I have been focussing on the sanctions on Russia. Now that they have actually taken the Crimea, it has become official EU policy to impose sanctions.”

“That is silly. Russia has every right to the Crimea. That is what we discussed last time.”

“Sure. They have more right to take the Crimea than we have of blocking Scotland or Catalunya or Flanders from becoming members of the EU. Still, the rules of international diplomacy tell us that sanctions are in order. This is what international diplomats tell me, anyhow. I would tell you about our list of sanctions but apparently you are not interested so I won’t.”

“Okay, shoot.”

Manny proudly listed his EU sanctions:

“The use of the Trans Siberia Express is prohibitted, in particular the driving around in circles, while normal use of the East-West connection still is allowed, in both directions.

Use of the rocket launching places in Russia is prohibitted, except for launching a rocket.

Marriage to a Russian is prohibitted, except those marriages that occur between January 1 and December 31 of a particular year.

The import of Russian caviar is blocked, except those imports intended for the West.

At receptions at a Russian Embassy, Western diplomats will not engage in Russian polka’s or Kozak or Derwish dances, unless they are sure to beat the Russians and impress the ladies.

At negotiations on new oil and gas pipelines, the West will refuse to accept pink pipes and insist on normal grey coloured ones that blend in with the landscape.

TV stations in the West will show more often those pictures of president Putin with bare chest on horseback, while the TV presenters will laugh hysterically about the nonsense of it, though they need not hide their admiration.

Whenever a piece of Tchaikovsky or Mussorgsky is played or a piece of Dostoyevsky or Pushkin is read, or a paper of Alexander Herzen is discussed, it is explained that is wasn’t made by president Putin, though he might have done it if he hadn’t been involved in saving the Crimea for Russia.”

Jose Manuel Barroso now looked like two puppies who had proudly peed for the first time on schedule.

“Okay,” I agreed. “You are set on tough negotiations with Putin. If you are wearing Google Glass, you might forget that other people don’t. So the first step is to make sure that also the Russians get it.”

Manny’s glasses flickered, so I presume that someone at Google headquarters understood.

My lunches with EU Commission President Manuel Barroso are generally rather boring but occasionally Manny springs a surprise on me. “Both the Russians and the Americans want this transcript to be leaked but they are afraid of being traced. You have a widely read weblog so you are perfectly placed for the job. You still owe me one,” he whispered yesterday. I hadn’t been aware that I owed him a favour but I can’t quite refuse when he feels like that. So here is the transcript. I include some notes within brackets for those who are new to diplomacy.


March 12, 2014. Moscow 22:00 hours. Washington 14:00 hours.

“Hello Mr President. /  Hello Mr President” (Both have been instructed to say this at the same time so that there is no discussion who is calling whom.)

Obama: “Dober dan.” (He has been told that this is Russian.)

Putin: “Dober dan.” (He has been told that this isn’t English.)

Obama: “I like to thank you for the crisis on the Ukraine. It is saving my Presidency. I seemed to be lost in frustration on national debt and health care but foreign policy allows me to be Commander in Chief again. I feel reborn.”

Putin: “Glad to be of service. It is part of Russian history to always help the West. And if we Presidents didn’t care for each other, nobody would. It is lonely at the top, isn’t it ? Perhaps you could give me an excuse to crack down on dissenting journalists again ?”

Obama: “I especially appreciate your patience now that Angela Merkel is calling you all the time. Michelle wonders whether she doesn’t have a husband she should be looking after.”

Putin (laughing): “I have an actor here, who does my voice, and who knows “Danke schön” in German. I also have a highly trained team to provide him with the empty non-committing phrases she appears to enjoy. I had to promise my actor that he would not have to meet her, for he would strangle her.”

Obama (laughing): “Well, I would  be an actor too, except for your Ambassador who is watching across the Oval Office. Would you like to say hello to each other ?”

Putin: “No, I hear his whistle now. You may block Apple and Google technology from coming to Russia but we have some elementary tricks that you seem to have forgotten about.”

Obama: “Like taking the Crimea as you have done. My compliments, Vladimir ! This will go down in history as a classic. We Americans sense that it is something like the Battle of the Alamo, and we can recognise how important that is to Russia. You have earned the warm respect and appreciation of the American people.”

Putin: “I now understand what the Battle of the Alamo means to the American people. So how would you feel if I would take the entire Ukraine ?”

Obama: “Ah, yes. I was hoping to talk about that too. Did someone ever tell you about my problems with health care in America ?”

Putin: “Why are you changing the subject ? Of course I have been told about your Health Plan. You want my advice, on how I take the Ukraine, that you might copy that for your Health Plan ?”

Obama: “I meant to say: if you would take the Ukraine then your problems would be similar like those that I have. Are you aware of the quagmire, the horror … ? It is Hell on Earth ! You have one actor now to deal with Angela Merkel, a bit like I have Joe Biden to go around and pat people on their shoulders. If you would take the Ukraine, you would need at least a hundred actors to deal with the fall-out. You know how obnoxious actors can be, even if they aren’t gay.”

Putin: “Russian actors aren’t gay.”

Obama: “Well, if you have a hundred Russian actors and you pack them in the Kremlin to control the crisis then some may well become gay. Do you really want this to happen ?”

Putin: “дooрьмо́. (“Shoot”.) Pray Mother Mary to save us !”

Obama: “Say, I have been thinking. Anyone can understand that Russia needs its naval base and cannot be dependent upon whatever government in the Ukraine. As I said, you earned the respect and the appreciation of the American People by taking the Crimea as you did. Why don’t we keep it like that ? And what if I lift most of the bans on Apple and Google technology ? My Ambassador in Moscow has been wanting to give you a smart-phone for ages.”

Putin: “Mатерщи́на. (Something about mothers.) I don’t even have a BlackBerry. You in the West always depict me as a huge dictator but the common person in the West has more power under his fingertips than I do.”

Obama whistles himself.

(67 seconds silence.)

Putin: “Okay, I want to acknowledge for diplomatic purposes that I have received a smart-phone from the US Ambassador, who has returned to his seat across the room, blowing his nose and wiping his tears. Apparently the phone comes with a prepaid annual subscription registrered at the US Embassy in Moscow to my name. I hate to say this, but do so for diplomatic purposes, that I am deeply touched. Does this mean that Americans understand that Russians are cowboys too ?”

Obama: “I presume that we will be seeing each other more often now, either at Camp David or at you dacha. Can I ask Michelle to send you the details of our diets ?”

Putin: “Ah, yes, the details.”

Obama: “And can I beg you not to tell your actor about this ? For some reason she thinks that the world is interested in her opinion, and for now I would like to keep it like that. Nothing worse than a scorned woman.”

Putin: “Of course. Well, I am holding our traditional red phone in one hand and my new smart-phone in the other. I feel torn apart. Shall we use the Apple next time ?”

Obama: “Ahem. Well, this is a bit embarrassing … We have a secure direct link now. I hesitate using my smart-phone because of all the people listening in. You understand what I mean ?”

Putin: “Ah ! Don’t forget that I was at the KGB ! You gave me a bugged phone ?”

Obama: “No, no, not at all ! A secure version, actually. But let me tell you what I understand of this NSA stuff. (…)”


Wolfgang Münchau rightly concludes “Germany’s constitutional court has strengthened the eurosceptics” (Financial Times Feb 9 2014). That German verdict will cause new turmoil on the euro.

To complicate matters, a Dutch website wonders whether Germany really has a constitution. Their reasoning is a bit convoluted so let me try to reconstruct it.

  • The German Constitutional Court (Bundesverfassungsgericht) itself states: “The Federal Constitutional Court’s task is to ensure that all institutions of the state obey the constitution of the Federal Republic of Germany (Basic Law).” Thus, there are the two words “Constitution” (“Verfassung”) and “Basic Law” (“Grundgesetz”). Germany may not have a Verfassung yet, only a Grundgesetz. The Basic Law was imposed by the allies in 1949 and differs from a Constitution created by a sovereign people.
  • The German original uses only one word: “Das Bundesverfassungsgericht in Karlsruhe wacht über die Einhaltung des Grundgesetzes für die Bundesrepublik Deutschland.”  It subsequently continues with Verfassungswidrig (“unconstitutional”), while of course the very name Bundesverfassungsgericht indicates that the Basic Law is treated as a constitution. (Though perhaps like the “European Parliament” calls itself a “Parliament” while it isn’t.)
  • Egon Bahr relates that German Bundeskanzlers had to sign a document (elsewhere called “Kanzlerakte”) provided by the Embassies of France, UK and USA. Willy Brandt tried to refuse but then caved in (Die Zeit 21 / 2009). But this was before Moscow 1990 with the treaty of the Final Settlement of World War II.
  • After that treaty of Moscow 1990, Germany changed its Basic Law somewhat. One can argue that their changing of it, is the act of a sovereign people.

I am in favor of Real Politik and I tend to accept that the Grundgesetz functions as a Verfassung. The allied forces imposed the original Grundgesetz indeed but I would focus on the point that the new BRD changed it. Their act of changing the Grundgesetz showed that they had the sovereign right to do so, and since they treat it as their Verfassung, it is one. But it is not as protected as in other countries. Also England has no constitution but only a Magna Carta.

While that is my point of view, it will be useful to indicate the sources of confusion.

We find the Basic Law here. It indeed carries the same distinction in article 146: “This Basic Law, which since the achievement of the unity and freedom of Germany applies to the entire German people, shall cease to apply on the day on which a constitution freely adopted by the German people takes effect.”  Thus the Basic Law recognises that there is no constitution yet.

In this educational page on German history we find the same conclusion in question 17: “(The document is called das Grundgesetz, which means “basic law”. It is not called die Verfassung which is the normal word for “constitution,” but it functions in every way as a normal constitution.)” The latter may be too simple. A constitution is based upon a sovereign people. The Basic Law has been imposed. Quite possibly the Germans might change the Basic Law in fundamental ways once the conditions of article 146 are fulfilled: freedom from meddling by others. Perhaps when the Germans are really free again, they abolish basic human rights and such, won’t they ?

When Germany was unified officially on October 3 1990, it is telling that its president Richard von Weizsäcker claimed: “we accomplished the unity and liberty of Germany in free self-determination”. He suggested a condition required in article 146 of the Basic Law to transform it into a constitution. But, it may be only a suggestion and political ploy. What is the real sentiment of the German people about their (imposed) “constitution” ?

The very point that Germany doesn’t have a Verfassung yet, or a document that they dare to call this, may also indicate that it does not have full freedom in self-determination yet. One can imagine that the Germans didn’t use the tedious constitutional process in the hectic days of 1990, but there has been ample time since then, and that time hasn’t been used. Why not ? Germans are gründlich, aren’t they ?

In the Treaty of Moscow 1990 we have to distinguish (1) the old Federal Republic of Germany (the West, or BRD), (2) East Germany, and (3) United Germany. The wikipedia article explains that East Germany was absorbed into the West: “Although the treaty was signed by the western and eastern German states as separate entities, it was ratified by the united Germany (the Federal Republic of Germany) per the terms of the treaty agreement.” Thus legally: United Germany = new BRD = (old BRD that absorbed the East). But still without a Verfassung, as the old BRD only had the Grundgesetz.

Wikipedia explains: “The Communist regime in East Germany fell in 1990; the parliament of the GDR (East Germany) declared the accession of the GDR according to Article 23 to the Federal Republic of Germany, making unification an act unilaterally decided by the last East German parliament. East Germany’s declaration of accession (Beitrittserklärung) included the East German territories into the field of application of the Basic Law. After the accession of East Germany to the Federal Republic of Germany Article 23 was repealed. Rather than adopting a new constitution under Article 146 of the Basic Law, the Bundestag (Parliament of Germany) only amended Article 146 and the Preamble of the Basic Law.” The process is also explained by Britannica.

The Treaty of Moscow 1990 states in article 7: “(1) The French Republic, the Union of Soviet Socialist Republics, the United Kingdom of Great Britain and Northern Ireland and the United States of America hereby terminate their rights and responsibilities relating to Berlin and to Germany as a whole. As a result, the corresponding, related quadripartite agreements, decisions and practices are terminated and all related Four Power institutions are dissolved. (2) The United Germany shall have accordingly full sovereignty over its internal and external affairs.”  (US Embassy in Germany)

This may be so, but this does not preclude that there might be another hidden agreement between the USA and Germany that exists apart from the Allied Four, and that infringes upon sovereignty and blocks the possibility to actually adopt a Verfassung.

In 2007, a former head of the “German CIA” Gerd-Helmut Komossa published the book “Die deutsche Karte” (The German Card - like in poker) stating that there was such a treaty in 1949. This is a video in English. I haven’t read Komossa’s book, but the Dutch website suggests that Germany would be militarily subjugated to the USA, and would have to keep its gold stored in New York. Bloomberg reports that only 30 to 50 tons of German external holdings of 3,387 tons are “repatriated” in 2014.

The Komossa suggestion thus is that the “Kanzlerakte” mentioned by Egon Bahr continued after Moscow 1990. 

Patrick Bahners discusses aspects of actually creating a new constitution like in the USA  (F.A.Z. May 18, 2009). But there may be those hidden factors that he does not discuss.

There are two ways to reason to the awkward conclusion that Germany does not exist. (1) The old BRD didn’t have a constitution (witness Egon Bahr). The old BRD absorbed Eastern Germany. When something without a constitution absorbs something else, then it still has no constitution. Hence the new BRD is not a sovereign nation. (2) In Moscow 1990 the old BRD was abolished and the possibility of a new sovereign United Germany was created. But that possibility has not been used yet, since there is no Verfassung yet. Hence the new BRD is not a sovereign nation. Both ways of reasoning result into the awkward possibility that Germany indeed has a secret treaty with the USA.

The Dutch website that I referred to, and from where I take most of these data and weblinks, suggests that the secret treaty of 1949 has a horizon of 90 years, and that US & German policy would be to target European Unification by 2039, so that the issue of a German constitution with real German national sovereignty would not arise.

This is a nice and for me new conspiracy theory that provides another rationale for the German focus on EU integration. Another was the Red House Report in the Daily Mail 2009 for example. Perhaps we should make a list, next to the reality that Germany is too small for the world and perhaps too big for Europe.

However, this text in English suggests a horizon to 2099 rather than 2039. Another wikipedia article in German quotes Komossa and also mentions 2099 (but it is wikipedia ….). However, the wikipedia article admirably provides a link to an answer by Angela Merkel, that the “Kanzlerakte” belongs to the realm of “legends”. That is, since 1990. Legends may have a true core in history. Angela does not account for Egon Bahr. In my earlier analysis (here) Angela Merkel has misled the German people at the elections of September 2013 about the economic costs of her EU-policy, but I don’t think that she would lie about such a straightforward issue of the Kanzlerakte. Though a “secret treaty” is a secret of course ….

The Dutch website that I referred to, and from where I take most of these data and weblinks, suggests also that the current German constitution would be that of the Weimar Republic, which would automatically have been resurrected by the abolition of the Third Reich. This does not seem sensible (either). It is more reasonable to assume that the Allied Four started from scratch once Germany was conquered. It would be silly to assume that an old regime is automatically resurrected when you have conquered the territory. But I am no lawyer, of course, and those might argue anything.

These were the sources for confusion. I remain with my position that Germany has a functioning constitution.

Musing over these points, though, we arrive at these conclusions: (1) It would help when not only Angela but also Barack confirms that there is no such secret treaty of 1949 that would still apply after 1990. (2) It would help when Germany adopts a Verfassung so that they grow more aware of what they might lose from integration into the EU. It would also resolve this new “stab-in-the-back”-kind of conspiracy stories. (3) It would help when say 80% of the gold is repatriated by say 2015. See my 2005 paper that we would use the gold rather not for monetary applications. Give people medals for their contributions to society. (4) It would help when Germany would follow a more eurosceptic policy, see my other weblog entries. (5) With the upcoming turmoil that Wolfgang Münchau rightly predicts after the verdict by the German Constitutional Court, it would be useful when European countries consider my proposal for national Economic Supreme Courts. If would fit in a constitution. (6) For the upcoming turmoil, see this paper on money anyhow.

PM. Dutch readers may want to check the conspiracy theory Dutch website I have referred to. Bad economic policy breeds paranoia too. That these Dutch conspiracy theorists focus on spooks may also explain that they haven’t discovered the plain and simple censorship of science at the Dutch Central Planning Bureau yet.


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