Comment, analysis and other offerings from Monday’s FT,
Clive Crook: Health reform weighs down Obama
Almost all Democrats and even some Republicans were sure the Patient Protection and Affordable Care Act, a measure opposed by most Americans when Barack Obama signed it in March, would be popular in short order. The electorate is timid about far-reaching change, they reasoned, but once the law passed, people would come around. The act was designed to deliver good news first and bad news later, which would help change minds. Pressing on was not as risky as it looked. That was the theory, writes the FT columnist.
Frederic Mishkin: The Fed must adopt an inflation target
Ben Bernanke, the Federal Reserve chairman, discussed his institution’s inflation mandate in a recent speech, leading to speculation a numerical inflation target is under consideration inside America’s central bank. And if there ever was a time to establish such a transparent and credible commitment to a specific target, it is now, writes Frederic S. Mishkin, a professor of finance and economics at Columbia University, and a former member (governor) of the Board of Governors of the Federal Reserve System.
Aleksander Kwasniewski: Ukraine seeks a European economic future
When elections produced a change of government in Kiev earlier this year, many people seem to have concluded Europe and America had “lost” Ukraine, and that the democratic gains of its Orange Revolution would soon be reversed. But several months later it is clear the approach of Ukraine’s new government is more pragmatic and reform-minded than most people expected. Provided the west can frame the right policies, the scope for encouraging change through engagement is still considerable, writes Aleksander Kwasniewski, President of Poland from 1995 to 2005.
Wolfgang Münchau: This stability pact obsession is not helpful
It happened the day after a controversial decision to subject sanctions to a political vote. I was sitting in the office of a well-known European central banker, who was jumping up and down. The eurozone would now not have any means to control fiscal profligacy, he said. That was in 1998. Not much has changed, writes the FT columnist.
Analysis: Qatar – Emir on a mission
Among property developers in London, the west’s top auction houses and investment bankers around the world, one of the sweetest sounding words right now is Qatar. In spite of both the global financial crisis and the troubles surrounding it in the Middle East, the little Gulf emirate is a very active dealmaker, whether it be buying Harrods, the London department store, investing in a stake in the Brazilian arm of the Santander banking group, or snapping up treasures at auction for its new museum of Islamic art, write the FT’s Roula Khalaf and Martin Dickson.
Lex on G20
If expectations are low enough, they can be surpassed without too much trouble. The G20 finance ministers managed that in Korea, Lex notes. Since national policy changes were out of the question, agreement on some fine words was an accomplishment – far preferable to an open fight. Besides, the International Monetary Fund’s governance is to be made less unrepresentative. For all that, economic globalisation is still running far ahead of its political counterpart.
Lex on LVMH/Hermés
Bernard Arnault has long been known for selling high. He controls LVMH, the leader in the luxury goods world, where gross profit margins above 50 per cent are the norm. But the richest man in France has just shown a remarkable ability to buy low, writes Lex. LVMH announced on Saturday it had acquired a 17 per cent interest in Hermès for €1.45bn, less than half of what it would cost at the current share price. The purchase raises a series of questions: how, why, when and whether?
John Gapper’s Blog: China’s Jon Stewart on Wen and chopsticks
This weekend in Shanghai, I met Zhou Libo, China’s most popular stand-up comedian and, among other things, a judge on China’s Got Talent, which has just concluded its first season (the winner was a man who plays the piano with his toes). Mr Zhou is the closest China has to a Jon Stewart, a comedian who draws his material from topical issues such as the rapid rise in house prices, writes the FT columnist.