The seminar and the lectures in US Foreign Policy did not really give me an academic framework for this specific policy analysis. In general though, Dr. Halper’s perspective as a Washington-insider was interesting, especially when we discussed Sino-American-Relations. And Dr. Thompson is a great historian with enthusiasm for Wilson – the seminar on Wilsonianism was one of the best debates in Cambridge.

But somehow I struggle to put the complicated and complex American policy making into simple concepts, such as Wilsonianism, Liberalism, Realism, Isolationism, Internationalism and relate them to the Economic Interests. When I read Frank Ninkovich’s Wilsonian Century, I wondered whether it is really possible to put the different objectives of American Foreign Policy into these terms.

Take for instance the claim that the United States foreign policy before the 1900 was isolationist, afterwards realist or internationalist. The United States has intervened in other countries since its foundation in the 18th century.

In almost all these conflicts policy-makers had to think about the economic and security consequences as well as about opinion at home. They had to motivate the citizens to go to war by appealing to higher ideals, but often enough financial and trade related motives came into play as well.

Was the foreign policy mostly dominated by economic concerns? In support of this theory, one could say that despite its rhetoric appealing to higher ideals, the US has supported dictatorships and authoritarian regimes around the world if it suited its economic or security interests.

The Comic Book Addicted to War uses an entertaining way to make the claim that the United States have employed military threats to receive economic concessions from other countries or and that they have intervened in countries when revolutions threatened to endanger American business interests.

The comic book features some interesting quotes by American Policy Makers and Army Representatives:

When any territory outside the present territorial limits of the United States becomes necessary for our defense or essential for our commercial development, we ought to lose no time in acquiring it.

Senator Platt

I spent thirty-three years and four months in active service in the country’s most agile military force, the Marines. I served in all ranks from second Lieutenant to Major General. And during that period I spent most of my time being a high-class muscle man for Big Business, for Wall Street and the bankers. In short, I was a racketeer, a gangster for capitalism.

[...]

Thus I helped make Mexico, and especially Tampico, safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenue in. I helped in the raping of half-a-dozen Central American republics for the benefit of Wall Street. The record of racketeering is long. I helped purify Nicaragua for the international banking house of Brown Brothers and Co. in 1909-1912. I brought light to the Dominican Republic for the sugar interests in 1916. I helped make Honduras “right” for American fruit companies in 1903. In China in 1927 I helped see to it that Standard Oil went its way unmolested.

Major General Smedley Darlington Butler

These quotes suggest that foreign policy is dominated by business interests. But not all foreign policy decisions are dominated by economic considerations. During the Cold War, American Foreign Policy was dominated by containment objectives towards the Soviet Union than business prospects.

One could argue of course that the military itself has been a striving business in the US whose interest it was to maintain a permanent state of confrontation to justify its expenditure. The United States spend more on the military than the rest of the world combined.

But if you compare the military spending of the United States to the American Economy, it is still rather small (only about 3.7 percent). While it is true that the military has an important standing in determining US Foreign Policy, I really wonder how much power the military industry in Washington has?

How about the importance of Economic Foreign Policy in the general Foreign Policy in the US. Jerel Rosati in his book “The Politics of United States Foreign Policy” has argued that many presidents were more concerned with diplomacy and security than with the economic foreign policy which was handled by a variety of agencies and departments in the American administration.

Do Economic Interests play a role in Elections? Election campaigns in the US are expensive and maybe politicians have a strong incentive to tailor politics to the needs of the corporate sponsors?

Yet election campaigns can also be financed through other means. The previous Obama campaigns were almost totally financed by individidual contributions.

Politicians in the US have to address the median voter because of a winner-takes-it-all system that permeates most primary elections and as well the presidential elections. This voting system allows some minorities to dominate regional elections which might be crucial to win the overall-elections. Also the majority voting also makes the congress less representative in terms of minority opinions. But it also limits the powers of single interest to be influential in elections.

Business interests do play a role in Washington – through providing expertise, lobbying, networking in the day-to-day policy process. However, it is unclear whether these business interests have always stronger role than other interests from NGOs or Activists Groups.

In Germany, individual politicians need the support of a political party. The major political parties need the support from business organisations and labor unions as well, so they are much more resceptible to economic arguments than in other countries. In the USA, Presidents in office can not count on the loyalty of their party, they need to win individual votes in Congress when conducting foreign policy. This process of finding a compromise opens the possiblity to have regional interests connected to larger policy initiatives, but it is not certain that this would allow business interests to dominate the foreign policy agenda.

All of this points to the finding that economic interests do play a role but maybe not a prominent one. Can we then say that US foreign policy are much more dominated by higher ideals like the struggle for democracy? I don’t think so. Historians and Policy Analysts should not confuse that the public statements of politicians and the actual policy can be quite different from each other. I think no one seriously doubts that often enough the US Foreign Policy has been in contradiction to democratic values and liberal objectives.

The key to understand the Economic Interest in US Foreign Policy is the character of the issue at hands. When the problem is a Zero-Sum-Problem where gains of the US means losses to other states (like the access to oil reserves), then economic interests and security interests align and interventions on behalf of these interests are clouded by referring to higher values.

When the US faces a problem where coordination between countries yields a higher output (a typical coordination-game in Game Theory Lingo), then the US Foreign Policy deviates from a strict security-based or economic-based foreign policy. The two World Wars can be cited as examples for that. In these instances, personal values of leaders have an impact on shaping the foreign policy of the United States.

I showed how Basel I introduced risk-weighted minimal capital requirements to have a global standard for assessing the risks banks were taking in the increasingly global financial markets. Prof. Kuczynski explained how Basel I indirectly brought about the Asian crisis because Interbank-Lending was given zero risk weight despite considerable real risks taken by some of the Asian commercial banks. I also brought forward the argument (raised here) that Basel II made banks rely too much on rated securities which made them fall into the subprime trap.

The handout from my presentation can be downloaded here.

Economic theory can be sometimes a little bit abstract. If you want to know what really happened in Economic history, read Prof. Maddisons book!

He is one of the few scholars who write as clear as a sharp knife. He makes his points in the most precise matter. does not distract his readers by referencing to theoretical camps in Economics or Political Science.

The book is split in three parts: the first one deals with various regions of the world (Europe, Asia, Africa), their economic development since 1 AD, and their economic relations. If you want to have a precise summary of world history and major trends, then each chapter can be useful starting point.

He also presents a multitude of data on income, population growth, and GDP. For me personally the period between the end of the West-Roman-Empire in middle of the first millenium and renaissance in the middle of the 15th century was most interesting to read. Maddison covers the political events taking place in the Middle-East and in Africa during that time.

The second part of his book discusses the history of Macro-Measurement. It is quite interesting to see how the development of macro-economic measurement coincided with the emergence of nation-states and large-scale civil administration.

The third part features an outlook of the World Economy in 2030. He predicts that by 2018, China will become the world’s biggest economy, India will be third. Maddison covers in detail is the impact on Climate Change on Economic Growth.

For a glimpse into the future of our planet, the book is a fascinating reading.

Via Airport, Spiekerblog, Codecandies.

Why are the markets so nervous? Why does every little hint of vulnerability of a Financial Actor cause stock markets to plunge down into unkown depths? What is the real deal behind the Subprime crisis?

The Stern has tried to explain to its readers why the American Subprime Crisis is causing havoc on Stock Markets worldwide. Their story goes like this:

After the last stock market crash, interests went down, thus also loans for housing. This caused more loans being given to people who normally wouldn’t have received a loan. The banks who handed out the loans sold these “risks” on the capital market, being bought by Hedge Fonds and other actors who are interested in high returns and don’t mind a little volatility.

With the interests rising in the U.S. again, more and more Americans can not serve their credit lines anymore and especially the “faulty” loans can not be repaid. Which is a big problem for some because basically the risk from the “faulty” loans was just pushed further out into the market – the risk was not diminished completely, it was just moved to another level in the market (sort of like a revenge by the poor on the big players in the financial markets). And some hedge fonds now pay the price, they are the last ones to buy the “foul plum”
and have to eat it now. (Needless to say that this is the big day for some other financial actors who are just waiting to pick the diamonds out of the rubbish and sell them big once the crisis is over – just not many people now which ones are the diamonds.)

The German media is turning a little story over to keep average stock market buyers calm. For sure, with the Germans strong belief in public institutions, the collapse of some of these financial institutions would cause a domino-effect that would take down quite some other markets as well. Paradoxically despite the overall growth of the German economy, the fizzy-bizzy of the financial markets could turn things around easily.

In order to prevent all of this, we can hear from all sides that the German financial markets are mostly safe. Probably that’s true, maybe they all speculated a bit on the American mortgage market but the big banks have lots of other horses in the race. So even if all hell turns loose, it shouldn’t affect the German Financial Market very much.

The problem is that the story started off the wrong way. Not only interests went up in the U.S., but also prices for food (see for instance this report from USAToday) and other products of daily need. Why is that? Well, it’s the same reason why in Europe food prices go up: high costs of energy, strong demand from Asia, small yields from formerly big food producers like Australia. Also prices for gas went up, the price for a barrel of crude oil reached alarming heights. Again, demand from Asia helped getting the prices up.

The USA could adopt to a less energy-intensive lifestyle – but it is quite unlikely that they will. Or can. The American Trade deficit is enormous and China on the hand is hording large junks of American Bonds. That’s in fact the only reason why the U.S.-Dollar has not lost its strength completely, because all over the world investors into the US finance the consumption of Americans and keep the dollar up.

The half-hearted attempts to persuade the Chinese in weaking their currency are not very succesfull. For one, the US has smaller leverage against the Chinese than the Chinese have against the US. Secondly, only with a weak Chinese currency, American prices can be kept down. If the Dollar is devalued against the Renminbi, American consumers will have to pay a high price. And it is not sure that investors would continue to float into the Dollar, it is more likely that they will strengthen the Euro.

The underlying scenario is this: the American Market, no, the American consumers to be more specific, know very well that an era of foreign-financed American consumption is soon over, because China is not going to hord more Dollars, energy prices are not going to go down anytime soon, food prices are going to soar and in terms of productivity countries like India are getting closer to the US (not to speak of Europe).

And knowing this, Americans are slowly changing their consumption habits. They know that their lifestyle will change drastically in the next decade – and the markets react to this. Maybe the subprime crisis is just the first of many signgs of this change.

Der Wert der Werte – Mit Ethik zum Unternehmenserfolg? Die Podiumsdiskussion organisiert vom Humboldt Forum Wirtschaft und den beiden Quandt-Stiftungen (BMW und Altana) hatte eigentlich das Ziel, die Debatte zur Wirtschaftsethik zu vertiefen. Man hätte annehmen können, dass die meisten Anwesenden sich mit der Problematik auskennen.

Aber nachdem die Moderatorin (Ursula Lucas-Bachert von der Agentur für Werte-Kommunikation) die Biographien der Podiumsteilnehmer mit dem Charme einer Kindergärtnerin vorstellt (“Ich les jetzt mal vor, was mir gerade aus dem Internet ausgedruckt wurde.”), legt der erste Referent Dr. Dr. Thomas Rusche mit ein paar Allgemeinplätzen los.

Wie ein Priester kommt er nach vorne, die Designerjacke lässig über den Schultern, das braungebrannte Gesicht voller Stolz, erzählt er uns, dass a) der Markt ein tolles System mit ein paar Macken ist, b) Menschen sich aber ethisch verhalten können, c) es auch ein paar nette Unternehmen gibt.

Herr Dr. Rusche: die unsichtbare Hand von Adam Smith und die Bienenfabel von Manderville wird von jedem zweiten Wirtschaftsjournalisten zitiert, wenn er damit klar machen will, dass der Eigennutz auch positive Folgen fürs Gemeinwohl haben kann. Aber den alten Knochen rauszuholen, wenn lauter BWLer im Saal sind, die man mit Adam Smith seit dem ersten Semester begossen hat, das hätte doch nicht sein müssen, oder?

Hätten sie doch mal lieber erzählt, was sie in ihrem Unternehmen, einer Textilienkette für Luxusherrenartikel tun, um Sozial- und Umweltstandards einzuhalten! Oder ob ein sauberes Gewissen nur bei den Margen in der Branche der Luxusshops möglich ist? Ich hab ja nichts dagegen, dass man mit einem knackigen Zitat aus der philosophischen Schatzkiste einen Einstieg in einen Vortrag macht, aber sage und schreibe 25 Minuten über die größten Allgemeinplätze zur Wirtschaftsethik zu referieren, das finde ich schon etwas viel.

Als Dr. Rusche geendet hat, ist Dr. Tessen von Heydebreck, Vorstandsvorsitzender der Deutschen Bank Stiftung, dran. Auch von seinem Vortrag hätte ich mir mehr konkrete Erfahrungsberichte gewünscht, aber er gibt wenigstens zu, dass die Deutsche Bank sich in arabischen Ländern wie Saudi-Arabien nur begrenzt an die Europäischen Wirtschaftsethik-Normen halten kann, weil man sonst nicht nur lokale Sitten und Gebräuche verletzen würde, sondern teilweise auch seine Angestellten in Gefahr bringen würde.

Pater Klaus Mertes vom Canisius-Kolleg ist das Gegenteil seiner beiden Vorredner. Ohne lange Umschweige bringt ein paar wichtige Einsichten ins Gespräch ein und entschuldigt sich gleich vorab, wenn er zu lange reden würde.

Er sagt, dass man Werte nur in Freiheit lernen kann. Nur wenn man sich ausprobieren kann, kann man Werte auch annehmen. Werte werden in der öffentlichen Debatte oft als Produkt von Erziehung verkauft, aber jemanden zu bestimmten Werten erziehen zu wollen, hat oft genau die gegenteilige Wirkung: der “Erzogene” wendet sich gegen die vermittelten Werte und lehnt diese ab. Pater Mertes sagt, das man selbst denken können muß, um sich Werte zu erschliessen.

Gut, ich gebe zu, dass in der verkürzten Form das auch ziemlich “selbstverständlich” klingen wird. Aber ich finde den Ansatz eigentlich interessant: was muss man eigentlich dafür tun, dass Werte gelebt werden können? Wie müssen sich Schule, Hochschule und Gesellschaft ändern, damit Werte nicht von oben herab aufgestülpt werden müssen? Müssen Schulen dann möglichst frei sein, wie der Sudbury-Schulen, die weder Stundenplan noch Noten haben?

Die Moderatorin ist jedenfalls nach dem Beitrag des Paters wieder aufgewacht und möchte das Gespräch voranbringen. Sie stellt fest, dass es sich bei der Diskussion bisher um Werte gedreht hat. Wahrscheinlich ist ihr erst jetzt der Titel der Veranstaltung aufgefallen.

Sie behauptet, der Mensch hat nur 26 bis 28 Werte, mehr leider nicht. Dann behauptet sie noch, dass es keinen Werteverfall gibt, sondern sich nur die Reihenfolge der Werte ändert.

Bevor noch weiteres intellektuelles Neuland betreten wird, stellt sie lieber gleich eine investigative Frage ans Podium: “Was ist besser, Ethik oder Gewinnmaximierung?”

Liebe Frau Lucas-Bachert, wer als Moderator solche Fragen stellt, dem müsste man das Mikro gleich wegnehmen. Solche Fragen sind doch geradezu Einladungen mit Goldkarte zum ausgiebigen Schwafeln, oder nicht? Nichts ist für den Zuschauer langweiliger als die alten abgefrühstückten Debatten noch einmal anzuhören. Insbesondere dann, wenn Sie selber auf Ihrer Homepage so ausgiebig Ihre Antwort auf diese Fragen geben: Gewinnmaximierung DURCH Ethik.

Dr. Rusche weiß zumindest zu sagen, dass bei BWL keine Ethik gelehrt wird, die anderen Antworten sind mir leider entschlummert, war auch schon sehr spät. Die nächste Frage der Moderation ist, ob Ethik-Kodizes wichtig sind. Jetzt beschliesse ich zu gehen, denn noch mehr allgemeines Geplänker halte ich nicht dann doch nicht aus. Auch einige andere Zuhörer verlassen den Saal, es scheint als ob das Humboldt Forum wirtschaft soeben mehrere hundert Stunden Lebenszeit vernichtet.

Ich hab nichts dagegen, wenn über Unternehmensethik diskutiert wird, aber dann doch bitte auf fachlich hohem Niveau, ohne viel Geschwafel und mit vielen Praxisbeispielen. Die Zuschauer gleich von Anfang mit einzubeziehen, ist meist eine ziemlich gute Idee. Denn dort sind meistens auch die besten Fragen versteckt – ein guter Moderator hat eben dafür ein Gespür, diese rauszukitzeln.

Ich hab nichts dagegen, wenn die Quandt-Stiftungen das Humboldtforum unterstützen, obwohl sich BMW und ALTANA wahrscheinlich solche Ausgaben auf die Haben-Seite ihrer CSR-Bilanz schreiben, obwohl unterm Strich nix rausgekommen ist. Aber schöner wäre es doch, wenn man kontroverse Gäste einlädt, Debatten zulässt, Netzwerke aufbaut und ein Follow-Up solcher Veranstaltungen fordert. Leider alles Fehlanzeige. Schade.

Zum Thema Wirtschaftsethik war neulich ein interessanter Artikel über Managergehälter bei Spiegel Online.

Und ein sehr aufschlussreiches Interview mit Alfred Ritter von Rittersport in der FAZ am Sonntag.

Zitat 1:

Wenn die Mitarbeiter nur das Gefühl haben, eine Nummer zu sein oder durch eine Maschine ersetzt werden zu können, dann haben die auch keine Motivation mehr sich zu engagieren.

Zitat 2:

Private Equity? Ich habe mit diesen Leuten nichts zu schaffen. Und darüber bin ich sehr glücklich.

Wie wäre mal damit als Diskussionsthemen für Wirtschafsethiker?