Information wants to be free

Information wants to be free -- Withdraw from China

Google, Facebook, YouTube are just examples of how the young generation is spending their time now a day’s. The invention of the World Wide Web has a phenomenal impact on nearly half of world population in the 21th century.

China with 1.3 billion inhabitants offers a broad application field. In the past weeks different newspapers always mention the conflict of Google and China. Information wants to be free. The internet as source of entertainment is limited in China. Foreign countries operating in China have been quick to see Chinas potential but are largely unable to grasp it. China has different values and strict regulations. Facebook, Twitter and YouTube are explicitly blogged, what you cannot imagine coming out of the western world.

The Economist is describing the situation analytical and is mentioning the fear of western firms that China just opens their own companies that supply the same service. Therefore the World Wide Web could be shaped from Chinese influence easily.

German Spiegel Magazine is quiet keen to present Goggles tactic and to provoke tension between Google and China. Spiegel writes that both sides are showing their power and trying to push the other side to the limit. How far can Google go? How does the Chinese government react?

Result: “Welcome to the new Google home Hong Kong”. Google moved its headquarters to Hong Kong what does not calm the situation at all. The move into the more “special economic zone” Hong Kong brings some advantages to Google. Google does not have to put any filter on its published information any more as the Chinese government asked Google to do. According to the Süddeutsche Zeitung this is not a “completely legal step”. I just like the competitive environment and that businesses as Google have to be creative and innovative to be always “one step ahead”. What made me laugh is the quote from Mike Hammer, one of the speakers of President Obama, where he states that he is kind of shocked that Google and China could not find an arrangement.

I could point out much more critical points like Google being scared of getting blocked and consequently looses the Chinese market. I want to focus more on the overall problematic from here:

Human rights are in the western world the solution to a balanced living together between individuals. China has still other values and will not change them as quick as the western world wants China to change. In my opinion much depends on people’s education and point of view towards development. A democracy is the modern form of a governmental structure in the western world but we needed many years to come to this stage. Google is representing the United States of America. Does the conglomerate fight for human rights? For equality and an “up-grade” of the individual person in China or does Google only want money and market share?

At this stage it is not visible how far both parties will go and how fixed they are to their own opinion.

But it is sure that the duel between the conglomerate Google and China is one of the most representative duels in a globalizing world in the 21th Century. It shows the differences in culture, believes and economic development.

Impressive video:

http://www.podcastingnews.com/2009/09/07/if-facebook-was-a-country-it-would-be-the-worlds-4th-largest/

The Economist

20th – 26th March 2010

Spiegel Magazin

http://www.spiegel.de/netzwelt/netzpolitik/0,1518,685123,00.html

Daily Mail

Süddeutsche Zeitung, 26^th March 2010

The Guardian

Google is another country

http://www.guardian.co.uk/commentisfree/2010/jan/29/google-davos-rusbridger

Financial Times

http://www.ft.com/cms/s/786a16d6-365a-11df-8151-00144feabdc0,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F786a16d6-365a-11df-8151-00144feabdc0.html&_i_referer=http%3A%2F%2Fwww.ft.com%2Fhome%2Fuk

How will Europe play its hand?

To compete against the US and China and other super powers, Europe has to fight as a UNION. The Greek crisis heated up the situation additionally in the last weeks. Europe has massive problems in the euro zone currently what does not help any economic recovery at all.

The Financial Times from last week uses a nice metaphor by putting the different countries on playing cards as the reader could choose his cards. Critique about the countries growth forecast of the four biggest countries in the euro zone (Germany, France, Italy and Spain) is all over. According to the Commission the forecasts are too optimistic. The Financial Times describes the movements in the euro zone always quiet objective and tries to concentrate on real facts. But are not public debts wiping out the benefits of roughly 20 years of fiscal prudence in the EU? Is the Greek problematic not just a symbol for still ongoing trouble between the members of the EU?

In comparison the German Süddeutsche Zeitung is critical about the approach of the Euro zone countries. The newspaper describes the situation as crucial and stressed. A serious scenario, stimulated from the “Greek issue”, is presented and the future of Europe as an economic base and currency area is questioned. Do Germany and other EU countries have to help? When do they have to help? How much? All these questions are not easy to answer. There are no rules and regulations for such scenarios but leaders, countries and commissions are confronted and have to take decisions.

I think all member countries still focus too much on their own aims. The “way of thinking” and the appearance to global competitors are still very individual. Did you ever see Nicolas Sarkozy speaking about great BMW and Mercedes from Germany? Did you ever see Angela Merkel standing behind Gordon Browns and facing the Americans? Yes, but not by far as Europe should appear. Europe has the “ingredients” to create a sensational competitor, a place to be and to live and therefore an outstanding business location.

If the EU wants to “play its hand” and play any important role between the “big players” as US, China or India, Europe has to play the game and try to appear as a Union. Nevertheless cultural background and traditions can be kept. I think that it is not easy to keep the balance between the two poles and all the interests but now with the Greek problematic Europe faces just an example that will show the connection, reliability and trust between the European countries.

In my opinion steadily raising public debts and the whole system of governmental deb is not the correct behavior in the 21.Century. Countries like Italy or France do not leave any safety margin in case economic development does not turn out that “brilliant” as projected.

Countries, governments and people have to take responsibility and have to start creating a future of more harmony and global relation. Also the question of “what comes after the globalization?” is something to think about during taking important decisions.

Europe,….. this is just the beginning…..

- Financial Times Thursday March 18 2010

Brussels warns forecasts too optimistic

http://www.ft.com/cms/s/a1bcd9c4-322c-11df-b4e2-00144feabdc0,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2Fa1bcd9c4-322c-11df-b4e2-00144feabdc0.html&_i_referer=http%3A%2F%2Fsearch.ft.com%2Fsearch%3FqueryText%3DBrussels%2Bwarns%26ftsearchType%3Dtype_news

- The Economist March 20^th – 26^th 2010

- Süddeutsche Zeitung Monday March 22 2010

Warten auf die Katharsis

Does Ben make the world go round?

Can Ben save the world?

For some people Ben Bernanke is a mysterious person, for some he is the marionette of Obama, for some he is one of the smartest person in the world but nearly everyone think that Ben has some of the power “to make the world go round”.

Ben Bernanke is the current Chairman of the United States Federal Reserve, “He just happens to be the most powerful nerd on the planet” (Time Magazine 2009).
The Fed controls the money supply and is an independent government agency that conducts monetary policy, which means it sets short-term interest rates. Ben is therefore influencing inflation, unemployment, the strength of the dollar and therefore the strength of your wallet.

According to Spiegel, Ben´s nightmare is the presence of global economic crisis. But worse would be that he is in charge and taking the wrong decisions. Spiegel and Focus, two German newsmagazines were determining Bens work last week in a kind of humorous but also scary way. The main focus was on the power that is given to one person in the 21th Century. Also if Ben looks like being the “right one” but is it right to give so much power to “King Ben”?

When the housing market crisis of the U.S. turned into the worst global financial crisis since many years, Ben blasted trillions of new dollars into the economy to rescue falling private companies, he ratcheted down interest rates to zero and gave money to borrowers who had never dreamed of receiving Fed cash.

The US Time Magazine is describing the situation very exorbitant what makes the situation funny and the reader smile but behind the whole scenario is pure seriousness what the reader never should forget. Probably the whole situation about the Fed and its global influence is so unreal and inconceivable so that you can only joke about it.

Focus is presenting facts about the Fed and its development under Ben Bernanke but not even close to the overwhelming and smart way as the US Time Magazine does it.

In comparison to Focus, Spiegel focuses strongly on future development and possible change of the influence and power of the Fed. Conspicuous but also coherent is that Ben directly tries to protect the power of the Fed. I think there is much more going on behind the setting what we cannot see from outside. How close is Ben to President Obama? What deals are made there?

“It is with considerable gratitude and not a little humility that I begin a second term as Chairman of the Board of Governors. I thank President Obama for the confidence he has shown in me by renominating me and the members of the Senate for confirming my nomination” (Speech, Chairman Ben S. Bernanke, Feb. 03.2010). The New York Times is writing critically about the second nomination what I think is correct because the reader should be stimulated to think about what is going on when such important steps are taken without any vote or democratic activity.

In my point of view Ben is one of the most important player guiding the world's most important economy. He definitely helped ensure that 2009 was a period of weak recovery rather than catastrophic depression. What scares me is that one institution, one man; one Ben has so much power to shape the path of the U.S. prosperity and even the direction of politics. What happens if this power is in the wrong hands? Did we not learn in the past years of history that too much power hold by one person can lead to the ruin….

I think Ben is one of the personalities that can manage this job, but what if he wants too much? Saving the world is not always easy and the future will bring up quite interesting challenges. Yen contra Dollar. Enthusiasts are switching out of dollar and into alternative low-yielding currencies such as yen. The dollar is therefore becoming less and less popular. This is only one issue Ben has to keep an eye on during his next four years at the Fed.

Ben has to learn that he cannot be friends with the whole world. Perhaps the dream of “saving the world” all the time is lovely but also keeps huge possibilities of failure. It's now up to our dysfunctional political system to let him do his job — and to fix the financial system so that he never has to save the world again.

Ben, good luck!

Sources used:

-Financial Times, Friday March 12, 2010

Increasing interest sparks movement

-The Time Magazine

Viewed: 14.03.2010

Available URL: http://www.time.com/time/specials/packages/article/0,28804,1946375_1947251_1947520-6,00.html#ixzz0iEkQtwpc

-Focus

Viewed: 12.03.2010

Available URL: http://www.focus.de/finanzen/news/konjunktur-bernanke-sieht-moderate-erholung_aid_483883.html

-Fed

Viewed 12.03.2010

Available URL: http://www.federalreserve.gov/newsevents/speech/bernanke20100203a.htm

-Spiegel

Viewed 10.03.2010

Available URL: http://www.spiegel.de/wirtschaft/soziales/0,1518,683512,00.html

-The New York Times

Viewed 14.03.2010

Available URL: http://topics.nytimes.com/top/reference/timestopics/people/b/ben_s_bernanke/index.html

-Business Week

Viewed: 14.03.2010

Available URL: http://bx.businessweek.com/ben-bernanke/view?url=http%3A%2F%2Fc.moreover.com%2Fclick%2Fhere.pl%3Fr2621123950%26f%3D9791

-Financial Times

Viewed 12.03.2010

Available URL:http://www.ft.com/cms/s/cefbcbc4-2184-11df-830e-00144feab49a,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2Fcefbcbc4-2184-11df-830e-00144feab49a.html&_i_referer=http%3A%2F%2Fsearch.ft.com%2Fsearch%3FqueryText%3DBernanke%26ftsearchType%3Dtype_news

Can loyalty and profit oriented decisions be combined? (Case of Ineos)

Where should important businesses (e.g. Multinationals) pay their taxes? How loyal has a company to be? Companies’ profit always depends on environemental circumstances. Subsidies, infrastructure, laws and regulations and other basic conditions are provided by a nations governmet. Should not be there loyalty if it comes to tax payments?

Ineos wants to “outsource” it´s headquarters from the UK to the “tax heaven” Switzerland what brings up general questions about loyalty and the moral of decisions that have to be taken in the business world to compete in the market.

"Moral" and "loyalty", big words that can mean anything but it starts with relyability to workers and to a whole country and its government. Businesses often have to take profit orientated decisions that help the firm to grow and to expand. On the one hand side a company can only be profitable and competitive when it is acting according to possible change (e.g. change in laws and tax regulations). As in many European countries the taxes are quiet high, a change of location of Headquarters (HQ) often rescues a company. The German Basler Zeitung describes the probable reallocation of Ineo´s HQ quiet objective but in my point of view it should get more pointed out that the change will help the UK based company growing and saving money. As stated in the Financial Times the saved money will be used for the UK Company and debts can be paid off easier. The Guardian uses a more confronting and provocating headline “Ineos tax deal sparks fury as firm plans move to Switzerland” to stimulate the reader to think about advantages, disadvantages and further impact if one of the biggest UK companies changes HQ. I prefer the more radical style of The Guardian that really points out the two different poles and mentions important issues like the reliance to a nations support in sense of infrastructe etc.

Is it a “taboo” to change HQ into another country? How important is it to stay in the home country? Can the movement of HQ change a company´s reputation?

Many questions which can be asked but only solved by analyzing each situation by its own:

As the Financial Times published the Ineos story on the Thursday´s front-page, the planned action is of high interest for the nation and people. I like the mentioned points in the article and I think the Financial Times shows immense insight of the impact of moving HQ into a tax heaven. The Financial Times point out the missing €450m that have otherwise been paid in tax to the UK. What a disaster!? How much money is missing in the UK financial reserves? The Basler Zeitung takes in an even more objective point than the Financial Times what is unusual and looks a bit like copied from another source from one of the UK Newspapers.

“The change of tax residence would allow us to increase investment to the benefit of all stakeholders in our business” states Ineos Chief Executive. His point of view is also stretched in the Financial Times and in the Basler Zeitung what I also see as the main argument from the business perspective. The company needs to do everything to survive and to keep up with competition because a bankruptcy would not help the nation ether the workers either the company itself. The daily Telegraph also shows a very objective point of view and only mentions important facts. In my point of view the daily Telegraph and the Basler Zeitung are not too much connecting the topic with further issues like loyalty to the home country or actions that need to be done to keep the company competitive to guarantee jobs in any place where the company is located. Diageo and Unilever, two other big UK companies are thinking about doing the same as Ineos. The economic crisis has cost the company money and they are trying to save “money” wherever it is possible. Therefore companies are not unwilling to stay with their cultural background but at a certain point there is no way back and the company has to take further steps to solve company’s problems. Changing HQ location, outsourcing and off-shoring are often results that help the company´s performance. All newspapers are lacking of further information and possible influence to the society.

In my point of view people and businesses which have a high influence on others have always a kind of “model role”. Companies that use the nation’s facilities as infrastructures and advantages like excelent workers should also be paying tax for it and for the society. Tax regulations should be straightened and tightened to secure it but most important is that future leaders implement it as a matter of course. I think that a nation like the UK or Germany has also to provide good conditions for Multinationals and other businesses to flourish their work and not to block growth or expansion. Harmony is not only the "key" between man and woman!

All in all the two poles (moral behaviour and business aims) are important aspects that should be carefully considered before a decision is made. Good luck Ineos but be aware its always hard to go for a come back...

Sources used:

Ineos Homepage

Date viewed: 04.03.2020

Available URLhttp://www.ineos.com/abo_his.html

Die BaslerZeitung

Chemie Gigant will in die Schweitz ziehen

Date viewed: 04.03.2010

Available URL: http://bazonline.ch/wirtschaft/unternehmen-und-konjunktur/ChemieGigant-will-in-die-Schweiz-ziehen/story/13341449

The Guardian

Ineos tax deal sparks fury as firm plans move to Switzerland

Data viewed: 04.03.2010

Available URL: http://www.guardian.co.uk/business/2010/mar/04/ineos-tax-breaks-plans-move

Telegraph

Ineos could leave UK over tax

Date viewed: 04.03.2010

Available URL: http://www.telegraph.co.uk/finance/newsbysector/pharmaceuticalsandchemicals/7364505/Ineos-could-leave-UK-over-tax.html

Financial Times from Thursday March 04.03.2010

Date viewed: 04.03.2010

Ineos looks to cut tax bill with Swiss relocation

The Times

Die Welt

Süddeutsche Zeitung

Frankfurter Allgemeine Zeitung