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Essay 4: The Union and The Energy:

From the perspective of the labor unions in Spain, mainly UGT and CCOO, we do have a stance, a position to defend regarding the energy policies. Policies that the government should consider implementing as soon as possible. After revising the overall situation that Spain lies on in respect to this subject, we have come to certain conclusions:

There has been a big boom in Spain in the last years regarding the implementation of the alternative ways of producing energy, mainly, but among others, the solar energy, the wind energy, the hydraulic energy. This boom has been caused, between other reasons, by the amount of government premiums given to companies that invested in this sector. These premiums were created to incentive an actual creation of alternative energy in Spain, but by this system the industry has apparently ‘overheated’. The amount of grants the government made has caused a relaxation in the sector, contributing to prevent lowering production costs, for example. There must be a stable growth of the alternative energy industry, that guarantees proper useful research, responsible financial management and a lower dependence on governmental help.

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On the other hand, an equilibrium must be maintained. Everyone knows that the future of the whole earth is compromised, and that this feeling must be addressed on specific measures. This equilibrium consists on lowering the subsidies the government gives on order to promote efficiency, but on the other side, not lower it to the extent of destroying the industry of the renewable energies. If there is an excessive cut to this industry, the companies that form it could be forced to shutdown as they are very vulnerable because of their dependance of the subsidies. This companies, and thus, the thousands of workers that occupy this sector must not saved.

Regarding the traditional ways of producing energy, we must note that it still accounts about nearly the half of energy produced in Spain, and must not be tried to eliminate at once for the sake of the environment. First of all, the nuclear powered energy accounts for the 20% of the total energy produced in Spain, and is a rather clean, stable and powerful energy source. Within the union we do not only plead in favor of this type of electricity production, but we are positive too that the debate over the generational succession of the old power plants regenerates. When it comes to the natural gas powered plants, we stand for a gradual limitation in its future consumption, due to the dependance of other countries, to low prospects of future technological breakthroughs , the high emissions of CO2 and the also high supply cost.

The carbon based energy is a very important source, and the only fossil based energy production that Spain can supply itself in a big part. It has played and continues to play an important economic and social role to the country. The closing of the Asturias on behalf of the so called ‘overwhelming costs’ is an important setback that would provoke more dependance on other countries, eliminate the mining industry of Spain, its technologies and know-how, and eliminate thousands of jobs of people who have nowhere to go. Carbon based energy production must stay.

We finally argue that there must be: a significant increment on the money invested by the state on new technologies regarding the new alternative sources of energy, that there must be defined a clear and understandable tariff policy. Also, new infrastructures and transport networks must be built in order to absorb the new sources of energy disseminated on the territory.

Eduardo Collin Hernández

1º ELG

25/09/2013

Essay 4. Energy Policies.

Sources:

Mainly: http://www.industria.ccoo.es/comunes/recursos/27/pub16158_Reflexiones_para_una_politica_energetica_en_Espana.pdf

Also:

http://www.industria.ccoo.es/industria/Informacion:Estatal:530436–La_Federacion_de_Industria_de_CCOO_y_MCA-UGT_muestran_su_gran_preocupacion_al_Ministerio_de_Industria_por_los_cambios_legislativos_en_materia_energetica

http://www.elcomercio.es/v/20131019/economia/reclaman-gobierno-costes-energeticos-20131019.html

http://www.finanzas.com/noticias/empresas/20131018/ccoo-piden-industria-politica-2523950.html

http://www.diariovasco.com/agencias/20131018/economia/ccoo-piden-industria-politica-energetica_201310181747.html

http://www.finanzas.com/noticias/empresas/20131018/ccoo-piden-industria-politica-2523950.html

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Essay 3: New challenges, ethics, and implementing bold solutions to new problems:

         This is the world of today. We live in it. It surrounds us, it binds us. It is a fast world, a whirlwind of decisions and information. Natural selection acts heavier than before, and anachronistic companies fell because they are not flexible. They don’t adapt and change to better forms of organizations, more organic way of doing things. New technologies cause it. The challenge of today is the challenge of time. The challenge of doing what has to be done quicker than your opponent. Communication with virtually the rest of the world is possible. Immediate communication is possible. And necessary. Many companies have already passed this challenge, but there are still people who work as if they were in the 20th century.

        This is the world of today. It is a communicating world, a giant network of people, an endless platform of contacts, of friends. The companies who learn to interact with people are the ones who prosper, because what we see today is that cooperation brings more progress than pure competitiveness. Interact with partners, on one hand, by having as many contacts as possible, and with costumers, by creating a sense of community. Companies should not only try to publicize through deceptive marketing techniques their products and services to the common people. Real life examples show that the companies that use the word of mouth, the sincerity, the positioning in which you are a true friend of the costumer are the ones that have easier access to demand.

        This is the world of today. It is a whole world, not just the Western one. Everybody knows the every country on earth has its big plan of growth. The West must know, as of today, to bear the surfacing of new economies and competitors. And if it wants to remain important and central to the world it must revitalize. Western economies have grown pre-crisis and will grow post-crisis between a 1% and 3% of annual GDP normally, while industrializing countries often grow much more than that. Beginning to invest in new markets, precisely in this developing part of the world, must be a key to success.

            This is the world of today. It is a human world, full of work, thoughts and desires. We can always see that the countries with less corruption, the countries that have a culture of hard work, such as South Korea, the countries whose people are the ones that are most productive, because of their mentality, are the ones who are most likely to succeed. When a country, or a company, is infested with poor productivity, general ‘laziness’, no long-term vision, or no ambition, it has much less chances to succeed more than competitors, be countries or companies.

            This is the world of today. It is a fragile world, and it should not be used savagely. It is not a present from our ancestors, it is a heritage to our grandchildren, and we live, now, in the greatest, richest moment of mankind. It is the most dangerous time for the earth. Companies have to realize that taking care of it is not only a mere philanthropic decision, but also a decision that should have a noticeable impact on the long-term future, for themselves too.

            The Organization for Economic Co-operation and Development published 12 principles to pursue in order to get an ethical company. Those principles talk about a clear policy against foreign bribery, the existence of a Chief Ethics and Compliance Officer or CECO having “authority to report matters directly to independent monitoring bodies” such as the audit committee, and being from “senior corporate officers, with an adequate level of autonomy from management, resources, and authority.” Also, a company is expected to inform business partners about its compliance and ethics program and that it does not intend to participate in or benefit from any corrupt practices. It also stated that companies should probably not assume that they have adequate controls to address the risk of foreign bribery simply because they meet national securities law standards; rather, controls need a separate focus on the risk of foreign bribery. They need both training and communications too on a periodic basis; training alone is not enough. Discipline is expected “at all levels of the company. They must not favor senior people over more junior employees. The should have systems to enable employees to get help including “urgent advice on difficult situations in foreign jurisdictions, promote the use of internal whistleblowing systems, periodic evaluations of compliance programs, etc.

Eduardo Collin Hernández

1º ELG

25/09/2013

Essay 3. Companies and businessmen standing up to today’s new challenges.

 Sources:

http://www.forbes.com/sites/insead/2013/05/31/oecd-economic-outlook-global-growth-this-year/

http://articles.latimes.com/2013/sep/03/business/la-fi-mo-oecd-economy-europe-us-china-20130903

http://www.oecd.org/eco/growth/going-for-growth-2013.htm

http://www.oecd.org/eco/outlook/equity-implications-of-fiscal-consolidation.htm

http://www.oecd.org/eco/lookingto2060.htm

http://www.oecd.org/eco/greeneco/

http://www.oecd.org/general/50452415.pdf

http://www.europeanbusinessreview.com/?p=2855

http://www.tradingeconomics.com/country-list/gdp-annual-growth-rate

http://www.oecd.org/greengrowth/48224539.pdf

http://www.oecd.org/daf/inv/mne/48004323.pdf

http://www.oecd.org/daf/inv/mne/

http://mneguidelines.oecd.org/text/

Essay 2: Competitiveness, reinvention and people stop thinking of the past when changing the future:

When talking about competitiveness, I like, as with others cases, always look on the deep, profound side of          things. Much has been written about it. About achieving it. About using it, mastering it, taking advantage of it. Companies and countries desperately search for it. I will not try to overlap what has been repeated so many times. I will try to talk on competitiveness by not talking about it too much.

First step: Analyzing the today’s point of view about Competitiveness:

          Competitiveness can be described as the “Ability of a firm or a nation to offer products and services that meet the quality standards of the local and world markets at prices that are competitive and provide adequate returns on the resources employed or consumed in producing them.” How is this ability created? The World Economic Forum calculates 12 variables to measure it per country and compared 147 in this year’s edition. The 12 so called pillars are: The Institutions, The Infrastructure, The Macroeconomic Environment, Health and Primary Education, Higher Education And Training, The Goods Markets Efficiency, The Labor Market Efficiency, The Financial Market Development, The Technological Readiness, The Market Size, The Business Sophistication, and Innovation. All these concepts have been used and talked on very much. To gain competitiveness people look to many of these variables, these numbers, to economy itself, which actually makes a lot of sense, but I want to make a different approach.

Second Step: Recognizing today’s some of the profound faults in our economic system:

          In order to Spain or another country to gain competitiveness, its companies are the ones who have to be more competitive. And I say who and not which, because companies are people, or should be soon people. Working together. When one thinks and looks back, the community lifestyle humans had during millennia was a sort of a utopia style form of organization, possible by the small size of that community and the facility of intercommunication. In the 19th century, a company was an entity, and a property of one person, with employees. Today the concept has begun to change. The maturation of human societies and the explosion of new revolutionary forms of communication have begun to permit the organic, efficient, happy way of ancestral human organization. But today’s companies in many cases continue engaged in an authoritarian, old-school, bureaucratized and creativity-coercitive system.

         Also, the political changes this last era has brought, principally Democracy, have not changed the economic system. When we think now about how could people throughout history let rule inefficient governors, the answer comes clear: they thought the same we think now about CEOs, board members and so on: “We do not have the authority, as employees, to decide who is the best to rule our company”. This apparent contradiction I also figured out seems to not be thought of many times. This is because people don’t tend to abstract themselves from themselves and the society around them. The efficiency, the competitiveness, caused by natural selection (in theory), by democracy inside companies, would and eventually will rise up competitiveness.

Step 3: Providing different solutions from about what everybody proposes:

The key to competitiveness cannot be, at least, only, be figured out by economics, by calculating, because that is what everybody already does. If we think this to find a solution to a problem, to a challenge, and we keep doing the same thing, implanting the same measures, acting the same way, there will be competitiveness, but not as much as we would want.

In a world where this classic competitive system, the flag of capitalism since its conception, is beginning to be complemented, even supplemented by cooperation, the classic measures will not work as efficiently. A broader view, a profounder analysis, a more philosophical orientation is the key to the competitiveness to the future. And what does this philosophy stand for? It stands for applying human nature in the economy. Socialists wanted some sort of utopia, where work didn’t entail a monetary retribution, but they wanted this to happen by revolution. Not revolution, but evolution is answer, the key. That day will eventually come, and is beginning to come. In the Internet, the enthusiasm shows itself, shines. Entire communities have made over the past years giant projects, and none of its members expected retribution, except for the happiness the work he did for free caused him. These communities, whom I’ve had the pleasure to watch and even work a little with, are a small minority of humankind, tiny. But its mere existence shows that an economy, a human organization, a future, based on cooperation, extreme trust and the natural expectancy for people to be good is possible, instead of a society based on self-interest and initial distrust, things which by themselves are not bad at all, but are simply a step down of the evolution of human societies.

People want competitiveness? Competitiveness in the very long term will be achieved only, or at least, for the most part, in finishing the migration from ‘competitiveness’ between people to ‘cooperation’ between people. The evolution of the human societies; the facility of intercommunication the boom of new technologies caused; the empiric examples of nowadays cooperatives that can be shown; the success of the today’s leading companies that have a radically different business model, close to the one explained here, like Pixar or Google, all these help me to maintain this bet, this new position.

Eduardo Collin Hernández

1º ELG

25/09/2013

Essay 2. Political Dialogues Reforms For Competitiveness.

Essay 1: Spain, Pensions and No-one wanting to give up anything:

One of the biggest problems in today’s global economy seems to be the amount of debt that most countries have in relation to their nominal yearly GDP. The number is in most cases out of scale, reaching sometimes the 100% ratio, and the worst thing is that this situation has tended to become normalized. If Italy wanted to eliminate its public national debt every citizen would need to work for free, and the benefits of all the Italian companies would have to go only to repay the debt for a year and three months, approximately [1]. It isn’t necessary to mention the fact that no country is willing to accept such sacrifice.

Although having a huge debt is not necessarily a great problem, since debt is always a necessary component to sustain a steady growth, many countries, like Spain, continue to ask for more money and add more debt each year because they are not capable, apparently, to make the State economically and financially profitable. And it is this fact the one that causes a noticeable preoccupation in the different governments around the world.

Everyone knows that for the accounts to be balanced, governments must either increase revenues, which are gained primarily by taxes, or lower costs, cut the spending. Spain is a case where the first option cannot be done without serious negative consequences as taxes have already been increased highly amidst of an important economic crisis. The other path goes by adjusting the deficit by, as said, cutting the spending. Spain has done this pretty effectively, making it go from a yearly 9,4% debt increase in late 2011 to a 4,4% now [2] [3], and we still have to count to potential earnings that will show up in the future once the economy has a positive growth again, unemployment lowers and taxes are paid more. The growth of the country will contribute in a capital way to balance naturally the Spanish balance sheet.

Many people say and have said, especially in the middle of this last crisis, that the welfare state is bound to disappear, and social policies, like healthcare and education, along with the state itself, must and inevitably will fall and adapt to new darker times. Those words were for the most part an act of demagogy. Education and healthcare represented to the government budget of 2012 a 0,7% and 1,3% of the total spending, numbers extremely low. The total social spending of the state sums up to a 19% of the total budget for that year, if we don’t sum up something, so it shouldn’t be an issue, right?

But there is a problem, and a very big one, literally. The big spending of the state are pensions. They represent all alone a whopping 37% of the total budget. The money taken to pay the pensions comes theoretically from the contribution to the social security system that Spain has. But in practice there is no special cash, there is no extra ‘reservoir’ that goes to the pensions. The government takes the money used for pensions from the taxes paid the last year. Then again, the immense amount of money the state has to pay each month to the pension system wouldn’t be necessarily bad in a sane and growing society. After all, theoretically, the money the state has to pay has already been received.

What makes the problem important is that, as we know, the Spanish society is going through a decadent demographic slope. In 2011 the ratio of children born by woman laid in the very worrying 1,36 [5]. This means that the population is decreasing, and the amount of people supporting the Social Security system is smaller and smaller and the elder people who depend on their pensions, bigger. A small glance at the Spanish demographic pyramid can be enough to make realize people this great problem [6].

The pensions problem seems to be the only challenge to the continuation of the welfare state as we know it, but not for being the only one it’s a small one. The solutions to solve it can only be radical and controversial. The first one I propose is to rise the limit age of retirement. It has traditionally been at the age of 65 here, and was recently lifted up to 67. But it was always at this age because it nearly touched the mortality rate. But a few decades later the mortality rate have risen up ten or fifteen years and the pensions haven’t. Pensions must rise up the age of 70, at least, as a base, with a look case per case in the healthcare system to not to put everyone at the same level.

Secondly, the amount of the pension given each month must not only be calculated by the amount of money given to the Social Security system throughout life. The amount of children had must also be a factor taken into consideration (except with people with special medical conditions). As a citizen, everyone is responsible for breeding the next generation and the people who have had many children and thus made a lot of sacrifices through a lot of time shouldn’t be punished with a lower pension because others didn’t have enough children and so there wasn’t a sufficient tax base to sustain taxes.

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