80% of Catalonians Say YES to Independence!

Last night I wrote (bold mine) 

Unlike the failed Scottish vote for independence where Scotland has mostly been a tax consumption economy, so in the fear of the loss of the welfare privileges, the elderly stampeded to cast a NO vote to independence, Catalonia has been the main contributor to the Spanish economy with nearly 19% of Spain’s GDP where her GDP per capita is higher than the European Union average (EU-27) according to the OECD.

In short, Catalonians may be fighting to keep their share of production rather than satisfy Madrid’s political interests by redistributing the former’s resources to the latter’s welfare dependent supporters.

Thus should Catalonia’s independence become a reality, this will likely signify a big setback to the already struggling Spanish political economy.

I am not aware of the political agenda of the leaders of Catalonia, whether they will elect to join the EU and adapt the euro or join the EU and decide to have their own currency or operate independently from the EU.

Moreover an independence victory by Catalonia can set in motion or inspire a string of existing and active secession movements around Europe to ask for political recognition. Should this happen this would serve as the death knell for the centralization plans for the Brussels based bureaucracy.

So should the independence vote prevail, there will likely be huge political uncertainties that will dangle over the political economic domain of EU and of Mr. Draghi’s ECB.

Well, Spain’s PM Rajoy, the EU and the ECB's troubles have come to fore as Catalonians has voted overwhelmingly for independence!

From the BBC.com

An informal vote on independence for Catalonia has shown more than 80% in favour, officials say.

The provisional results followed a day of voting across the autonomous region in north-eastern Spain.

The non-binding vote went ahead after Spain's constitutional court ruled out a formal referendum.

Earlier, Catalan leader Artur Mas hailed the non-binding poll "a great success" that should pave the way for a formal referendum…

The 80% Yes…

Voters were asked two questions - whether they wanted Catalonia to be a state and whether they wanted that state to be independent.

Vice President Joana Ortega said that more than two million people had taken part in the "consultation of citizens" and that with almost all votes counted, 80.72% had answered yes to both questions.

Just over 10% voted yes for the first question and no for the second, he said, and about 4.5% voted no to both questions.

Spain’s Mainstream Resists…

The ballot was held in the face of fierce opposition from the Spanish government.

Speaking beforehand, Spanish Justice Minister Rafael Catala dismissed the exercise as "fruitless and useless".

Opinion polls suggest that as many as 80% of Catalans want an official referendum on the issue of Catalonia's status, with about 50% in favour of full independence.

Spanish unionist parties argue that because the ballot was organised by grassroots pro-independence groups it cannot legitimately reflect the wishes of the region.

More than 40,000 volunteers helped to set up and run the informal exercise.

It is obvious that beneficiaries of Spain's welfare state will refuse to have an independent Catalonia, that’s because these groups get their welfare finances from them! The political parasites would essentially lose their financial and economic hosts!

But if the Spanish authorities will defy the wishes of Catalonians, don’t expect a peaceful transition. At worst, the outcome could be a civil war.

Catalonian experience as I noted above will fire up a string of existing and active secession movements around Europe to likewise ask for political recognition. The wave of decentralization has snowballed. 

The existence of the EU, ECB and the euro are now in jeopardy

Scotland’s Independence Referendum: What will Hayek Say?

What would be the likely insight of the great Austrian economist and Nobel Prize winner Friedrich von Hayek on the coming Scotland independence referendum? 

At the Lew Rockwell Blog, Austrian economist Thomas DiLorenzo lifts a quote from Mr. Hayek’s masterpiece the Road to Serfdom (Chapter 15, pp. 257-258) for a cue:

We shall not rebuild civilization on the large scale.  It is no accident that on the whole there was more beauty and decency to be found in the life of the small peoples, and that among the large ones there was more happiness and content in proportion as they had avoided the deadly blight of centralization.  Least of all shall we preserve democracy or foster its growth if all the power and most of the important decisions rest with an organization far too big for the common man to survey or comprehend.  Nowhere has democracy ever worked well without a great measure of local self-government, providing a school of political training for the people at large as much as for their future leaders.  It is only where responsibility can be learned and practiced in affairs with which most people are familiar, where it is the awareness of one’s neighbor rather than some theoretical knowledge of the needs of other people which guides action, that the ordinary man can take a real part in public affairs because they concern the world he knows.  Where the scope of the political measures becomes so large that the necessary knowledge is almost exclusively possessed by the bureaucracy, the creative impulses of the private person must flag.  I believe that here the experience of the small countries like Holland and Switzerland contains much from which even the most fortunate larger countries like Great Britain can learn.  We shall all be the gainers if we can create a world fit for small states to live in.” 

(Emphasis by Mr. DiLorenzo).

Economics Drives Politics: Scotland’s Independence Referendum

Will Scotland secede from the United Kingdom? This will be determined by a referendum in September 18th. 

As for a background on this, Sovereign Man’s Simon Black explains: (bold mine)

Anyone who’s ever seen the movie Braveheart has heard of William Wallace, one of the original heroes of Scottish independence.

Though Mel Gibson’s highly fictionalized account was one of the most historically inaccurate movies in modern cinema, Wallace did, in fact, lead Scottish rebels against English invaders. And he died for his cause.

Wallace was severely tortured after being convicted of high treason against King Edward I; he was dragged by horses, hung nearly to the point of death, revived, relieved of his manhood, ritualistically disemboweled, made to watch his entrails set ablaze… then finally beheaded.

Not the way you want to go.

That said, the movement for Scottish independence lived on, and England folded in 1357, ending a 60-year war between the two nations.

For the next 350 years Scotland remained an independent state until… go figure… a financial crisis.

In a desperate attempt to become (almost overnight) a major world trading power in the 17th century, the government of Scotland backed a comically ill-fated attempt to colonize Panama.

It failed miserably. Yet the investment in the Darien Scheme (as it was known) amounted to up to half of Scotland’s total money supply.

When it went bust, Scotland was nearly broke.

There had already been a push to reunify with England for some time. And with the country’s economy in shambles, unification seemed like a good move.

Today Scotland again finds itself debating the question of its independence, fueled once more by economics.

It’s easy to point to a number of different causes of rebellion, revolution, and dissent. But ultimately it’s economics that matter more than anything else.

When times are good and everyone is prosperous, few people want to rock the boat. No one has an incentive to change the system when it’s working so well. 

Only when the prosperity begins to collapse do people have a strong motivation to change the status quo. 

Suddenly the jobs are less plentiful, the taxes are higher, the standard of living is lower, and the costs are greater. And people demand change. 

The greater the pain, the greater the desire to shake things up. And it’s happening across the world.

In Europe, separatist and extreme parties are gaining ground on the heels of an economic depression that has besieged the continent for several years now.

In France, Spain, Italy, Greece, etc., people are fed up with the current state of affairs, and they are agitating to split off from their current political leadership.

Likewise, Scottish voters are going to the polls in just over a week to decide if they should break away from the UK.

And from the looks of things, the independence movement has a very strong chance of winning.

A wave of secessionist movements around the world have been underway.

Crimea has just seceded from Ukraine, early this year.

There is one is Venice (from Italy), in Catalonia (from Spain), in Quebec (from Canada) and in Transnistria (from Moldova). 

Secessions (political decentralization) have been part of the growing political trend brought about by the ongoing and deepening failures of political economic centralization which has been a product of the (top-down) industrial era. The coming crisis will magnify such transition.

And secession trends will likewise be reinforced by the deepening of the information age (bottom-up) where connectivity via social media networks facilitates the enhancement of community (net lingo: tribal) based non-contiguous relationship

Third Wave Politics: Failing Nation States and the Growing Secession Movement

Industrial age centralized governments will pave way for decentralization.

In the observation of Europe Day Sovereign Man’s Simon Black writes:   (bold mine)

But what is true is that European imperialists conjured entire nations in Africa out of thin air from their palaces in Brussels, Paris, and London.

And all of this was done without any regard for ethnic, linguistic, religious, and historical divisions among the various tribes that inhabited Africa.

But what few people realize is that Europe is no different.

Think about it—the United Kingdom consists of England, Wales, Scotland, and Northern Ireland lumped together in a political union.

Each is entirely different from the others. And secessionist movements are alive and well. 

Scotland will hold a referendum about its independence in September. And the troubles in Northern Ireland have plagued the region for decades. 

Belgium is a completely artificial country, and the Flemish are actively pursuing independence from the Walloons. 

In the late 19th century, Germany and Italy were both unified into modern countries from diverse fiefdoms and city-states with strong regional identities.

Those regional identities are still present today. Just a few weeks ago, a vote was held in Venice over independence for the wider region. 

The Basque separatist movements in Spain are stronger than ever. The Balkans were an absurd experiment. I could go on and on.

Europe is the best example that borders and countries are completely arbitrary. 

They are created to serve one purpose—consolidating authority over a piece of land and the people living upon it. 

Today just happens to be “Europe Day”, a holiday in which Europeans are supposed to commemorate the Schuman Declaration that jumpstarted today’s European Union. 

This is a continent that has a long history of constantly going to war with itself.

They slapped lines on a map, formed some new countries, and expected that everything would be OK.

Then they made those lines even broader when they consolidated everything into the European Union. And EU politicians are trying to make things even bigger.

History shows that when economic times are good, people are happy about unity. 

But when times are tough as they are now, divisions start creeping up. People look around and say “this system isn’t working”. 

They demand change. Sometimes violently. And we would be foolish to presume that this time is any different.

The immediate avenue for this conflict to play out is still through peaceful means—referendums and the rise of nationalist and Eurosceptic political parties. 

But it’s clear that the trend is to get smaller, not bigger. And for the system to change entirely. 

Like feudalism before it, the nation state is a failed experiment that will ultimately be replaced. It’s already happening. 

Pls continue to read here 

I previously noted that growing secession movements marks the “gradual confirmation of the predictions of futurist Alvin Toffler as elucidated in his highly prescient 1980 book, The Third Wave (p.317)

National governments, by contrast, find it difficult to customize their policies. Locked into Second Wave political and bureaucratic structures, they find it impossible to treat each region or city, each contending racial, religious, social, sexual or ethnic group differently, let alone treat each citizen as an individual. As conditions diversify, national decision-making remains ignorant of the fast-changing local requirements. If they try to identify these highly localized or specialized needs, they wind up deluged with overdetailed, indigestible data…

In consequence, national governments in Washington, London, Paris or Moscow continue, by and large, to impose uniform, standardized policies designed for a mass society on increasingly divergent and segment publics. Local and individual needs are forgotten or ignored causing the flames of resentment to reach white heat. As de-massification progresses, we can expect separatist or centrifugal forces to intensify dramatically and threaten the unity of many nation-states.

The Third Wave places enormous pressures on the nation-state from below.

Bursting bubbles will only compound on such trend.

Quote of the Day: Secession: Divorce American Style

As for states seceding, however, is that really a solution to national disintegration? Tens of millions with Blue State mindsets live in Red State America, and vice versa. While folks in Texas may talk of seceding from the Union, folks in Austin talk of seceding from Texas. 

Yet we should take seriously what is behind this desire to separate and sever ties, for it mirrors what is happening across our civilization. 

The West is decomposing.

British Tories seek to cut ties to the European Union. Scots want to leave Britain. Catalans vote to divorce from Spain, to which they have been wedded since the 15th century. Flemish talk of leaving Walloons behind in Belgium. Northern Europeans are weary of carrying their profligate southern brethren and muse about cutting Greece adrift and letting it float out into the Mediterranean.

And Americans are already seceding from one another – ethnically, culturally, politically. Middle-class folks flee high-tax California, as Third World immigrants, legal and illegal, pour in to partake of the cornucopia of social welfare benefits the Golden Land dispenses.

High-tax states like New York now send tens of thousands of pension checks to Empire State retirees in tax-free Florida. Communities of seniors are rising that look like replicas of the suburbs of the 1950s. People gravitate toward their own kind. Call it divorce, American-style.

This is from author and editor of the American Conservative Patrick J. Buchanan (from LewRockwell.com)

Third Wave Politics: Secessionist Parties in Spain Gains Political Footing

In the information age, forces of decentralization will function as the key agents of social change.

In the realm of politics, such evolutionary transition will likely be channeled through secessionist movements.

In Spain, the secessionist parties of Catalonia may have just gotten the momentum that could trigger a potential chain of events.

From Bloomberg,

Pro-independence parties in Catalonia won a regional vote, strengthening a drive for a referendum on secession in defiance of Spanish Prime Minister Mariano Rajoy.

Catalan President Artur Mas, who called early elections to force the debate on independence, won 50 of the 135 seats in the regional assembly for his Convergencia i Unio party, down from 62, with 99 percent of the vote counted. The separatist Catalan Republican Left, known as the ERC, more than doubled its seats to 21 from 10. Two smaller parties that also back a plebiscite secured 16 seats.

Rajoy, weakened by recession and speculation that Spain needs a European bailout, says a referendum on secession is unconstitutional. Mas’s losses showed his bid for a mandate backfired, leaving him dependent on anti-austerity separatists to govern Spain’s largest regional economy.

“With a majority, Mas could have negotiated for all kinds of goodies to postpone the referendum but clearly that’s not an option anymore,” Ken Dubin, a political scientist at Carlos III University and IE business school in Madrid. “He was hoping he’d have a stronger hand to negotiate some intermediate status, but his bluff has been called.”

Rajoy’s People’s Party won 19 seats, a gain of one. The Socialists took 20 seats, down from 28.

Mas has pledged a referendum within four years. In contrast, the ERC would be willing to declare independence unilaterally in 2014.

The above developments reminds me of, and appear as gradual confirmation of the predictions of futurist Alvin Toffler as elucidated in his highly prescient 1980 book, The Third Wave (p.317)

National governments, by contrast, find it difficult to customize their policies. Locked into Second Wave political and bureaucratic structures, they find it impossible to treat each region or city, each contending racial, religious, social, sexual or ethnic group differently, let alone treat each citizen as an individual. As conditions diversify, national decision-making remains ignorant of the fast-changing local requirements. If they try to identify these highly localized or specialized needs, they wind up deluged with overdetailed, indigestible data…

In consequence, national governments in Washington, London, Paris or Moscow continue, by and large, to impose uniform, standardized policies designed for a mass society on increasingly divergent and segment publics. Local and individual needs are forgotten or ignored causing the flames of resentment to reach white heat. As de-massification progresses, we can expect separatist or centrifugal forces to intensify dramatically and threaten the unity of many nation-states.

The Third Wave places enormous pressures on the nation-state from below.

It is happening.

Chart of the Day: Europe’s Double Dip Recession

Political solutions in the Eurozone, meant to preserve the status quo for the political establishment, has been worsening economic conditions as industrial production has rolled over even in major nations as Germany and France.

Writes Dr. Ed Yardeni (chart also from Dr. Yardeni’s Blog)

The Euro Mess remains as messy as ever. However, investors have been less concerned about a financial meltdown in Europe ever since ECB President Mario Draghi volunteered at the end of July to do whatever it takes to avert a euro cliff. Furthermore, the Europeans continue to kick Greece down the road rather than force it out of the euro zone. Nevertheless, Europe is sinking deeper into a recession. That’s becoming a more significant concern to investors I’ve talked with recently, especially if the US economy falls off the fiscal cliff.

Particularly unsettling yesterday were massive and widespread anti-austerity protests across Europe. The strikes and demonstrations, some involving hundreds of thousands of people, hit more than 20 countries in the EU, disrupting airports and ports, closing roads and public transportation, and shutting some essential services. The biggest protests were in Portugal, Spain, Greece, and Italy. The union-led protests--called "European Day of Action and Solidarity"--were mostly peaceful, but turned violent in Lisbon, Madrid, and Rome.

Yet political solutions (bank and sovereign bailouts, ECB’s interventions, surging regulations, higher taxes and etc…) will not only hamper economic recovery, they will lead to more social frictions which increases the risks of the EU’s disunion—as evidenced by the snowballing secession movements—and of the escalation of violence.

US Post Election Politics: 20 States Petition to Secede

In the Philippines, accusations of cheating typically marks the post-election political environment.

In the US, the recently concluded presidential and national elections has prompted malcontents from 20 states to petitioned the White House to secede.

From the BBC,

More than 100,000 Americans have petitioned the White House to allow their states to secede from the US, after President Barack Obama's re-election.

The appeals were filed on the White House's We the People website.

Most of the 20 states with petitions voted for Republican Mitt Romney.

The US constitution contains no clause allowing states to leave the union. By Monday night the White House had not responded.

In total, more than 20 petitions have been filed. One for Texas has reached the 25,000-signature threshold at which the White House promises a response.

'Blatant abuses'

The last time states officially seceded, the US Civil War followed.

Most of the petitions merely quote the opening line of America's Declaration of Independence from Britain, in which America's founders stated their right to "dissolve the political bands" and form a new nation.

Currently, the most popular petition is from Texas, which voted for Mr Romney by some 15 percentage points more than it did for the Democratic incumbent.

The text complains of "blatant abuses" of Americans' rights

Growing secession movements in the US and in Europe are symptoms of snowballing forces of decentralization, or the paradigm shift to localize and diversify power which have been gnawing at the architectural foundations of the 20th century political establishments.

Yet secession movements could turn out to be bloody as governments typically tend to resist or counteract the prospects of yielding territorial and taxation privileges by the suppression of political dissident by force.

Nevertheless secession movements are signs of grassroots opposition to centralized political power.

As Austrian economics Professor Thomas DiLorenzo duly notes,

Government will never be limited unless the citizens take matters into their own hands by resurrecting the states’ rights mechanisms of nullification, interposition, and secession.