The shopkeepers have given their verdict; the winter sales which finish this week have been a flop. It was the local government with much back-slapping who decided to organise the sales calendar, in other words politicians decide when and where shops are allowed to reduce their prices. Now, curiously enough the government mandated sales period started bang in the middle of the launch of the new single currency. The chances that people would go on a spending spree with notes and coins they didn't know or understand, were pretty limited. Also, for a variety of reasons there has been a slump in winter tourism and therefore there were far fewer tourists shopping on the High Streets. I am sure that if you had asked any shopkeeper in early January if he or she wanted the sales to be delayed the majority would have voted for a postponement until Easter when most people had become accustomed to the single currency and there were more tourists about. This the major problem with politicians trying to control the private sector, it doesn't work. You can't decide on shop sales months in advance because it naturally depends on market conditions. If the conditions aren't right then cash registers will not be as full. The local government must allow shopkeepers and big stores to decide when the time is right, because they are on the frontline and they know their market. A free market and free commerce is designed around the basic theory of giving people what they want, when they want. In the case of the Balearics at the moment it is the local government deciding when and where, which as we have seen is a recipe for disaster.
Europe of tomorrow
The grandly titled Convention on the Future of Europe begins its deliberations today. It has a year's work ahead of it, considering the kind of European Union that will be necessary to handle its expected expansion from the present fifteen members to perhaps twenty-five, with most of the newcomers being former east European communist states. The chairman of the Convention is the former French President Valery Giscard d'Estaing and its one hundred or so members come from national governments and parliaments and the European Parliament. In looking at the future the Convention will first have to consider how well the European Union functions with its existing arrangements. One issue that should get close attention is the rotating presidency under which each member state (currently Spain) is put in political charge of the EU's policy machinery for a period of six months. However efficient and hard-driving a country may be there is a limit to what can be achieved in six months especially since the EU's civil service is the Commission in Brussels which often has ideas of its own. The system only just works with fifteen members and would be under great strain with twenty-five. The Convention will also want to look at the relationships between the councils of ministers which drive policy forward, the Commission which carries out agreed policies and the European Parliament which has a so far limited role of scrutiny and supervision. The Convention has a formidable task before it; its proposals will provide a first draft of a new treaty to guide the European Union in the next major phase of its development.
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