An opportunity to introduce the M.O.-derivate instrument to be used in Cyprus-crises?
The ongoing crises in EU and its financial market has catched Cyprus-the small,divided island state in the EU-community. The EU-part of the Cyprus has short of money in the state budget and is forced to get new loans from EU and the IMF. Other EU-states will give required first aid-10 billion Euro-if the Cyprus sets up an onetime tax on the bank accounts between 6.75 percent (for deposits lower than 10-20.000 Euro) and 9.9 percent for greater deposit accounts which have more spared on the bank accounts in the Cyprus banks. The made EU-proposal has aroused the masses who are afraid that their financial buffers are now confiscated with the tax and thus leading to minor demands on the market and lowered confidence on the public officials competence to manage the crises in Cypros. Those who has EU-wide focus-mostly economists and politically interested-are afraid that this onetime tax on the banking deposit account will be the strategy even on other EU-states. This could be very dangerous to the continued possibilities to handle the crises as people would take up their savings from the banks and thus making it much worse to handle the required new social-economic reforms in the crises-states such as Spain,Italy,Greece,Ireland etc. The European wide change to the growth would be postponed further-the crises would be ongoing state in the EU.
What could be done then? The latest revision proposals state that it would be socially more fair if only those who have more money on the deposit accounts in Cyprus would be taxed. Maybe so,but this could not solve by necessity the needed growth problem. Others say that EU-wide introduction of euroobligations should be used to monetize the needed crises for the Cyprus-state and its lack of money in the state budget. This could be also a manageable social gesture,but would it by necessity lead to the needed growth or social-economic reforms in the island state where the money market has found an easier waterhole for money parking because of lower taxes or better conditions for the financial investors. What to do if the needed,short time solution becomes a good social gesture but erodes the longtime confidence of the people in the whole EU? Could it be other ways to handle the Cyprus-crises-and by that-even give an example how to go further on other EU-states-EU-wide?
As an alternative thinker and social entrepreneurial consultant I think this is an opportunity to refer to my own,new M.O. (Management Option)-derivate instrument. I created the instrument in 1990,reading newspaper when making a bicycle tour to the nearby river to take on the swimming bath. How could I handle these big projects which were collapsed economically when handled by short time perspectives? I got the idea to my new instrument,which I tried to sell on the market. First sending press-release 900605 to the Swedish agency,then having a minor announcement on the bigger,local newspaper Svenska Dagbladet Tuesday,14th may 1991.The market didn't show any interest to my tree doubled secured,new kind of derivate instrument. My later writing on the Webb,on my own webbpages where I described the instrument and compared it to other,current solutions,woke neither any comments or contacts. In my opinion-as the crises imploded later in 2008 and stated the global crises,the market hadn't have this kind of crises at all if it would have used my new instrument. But-let the history be left in peace-how could the EU-wide crises,the rest result of the former global one-be handled now if the proposals above-from the high leaders of EU-COMMUNITY- want solve the situation-neither on the short or longer perspective. Have I now courage and integrity to maintain my confidence on my M.O.-instrument as a way to solve the Cyprus-crises on an a creative way,when myself robbed here by local officials of my company investments as it had been the market who had failed,not me? What kind of solution could be done if using the new instrument of M.O. ?
I'll make my proposal in three steps and at the same time analyzing the made proposals.
1. Cyprus-state could have the made EU-decision as a starting point. Instead of taxing the deposit account by the proposed percentages,the taxes could be lifted as a made M.O.-options,collected to the local M.O.-fund.
2. The state could give following assurance: if the accepted growth-projects (see below) want give profit above the given percent (project overvalue),the lifted tax-options would be paid back by the state with the percentages (lower for M I-kind of M.O.-options,higher for M II-kind which could be selled further on the financial market AFTER the project begins to show positive results over overvalue) plus average deposit rent on EU-wide deposit accounts. The results would be positive to both the state-give time to start new growth-projects and/or make new social-economic,needed reforms-and to the savers and investors. Guaranting the minor savers and giving opportunities to the financial investors. As the M.O.-instrument has a special kind of combination of the different functions of insurance,investment and loans (project seed money)-with its institutional fairs quaranting results socially (savers want lose their money as options are insured during the project time) and the economically as the options are not sold at all (for M II kind options,for investors) if the projects are not showing results over the projectvalue (the concept of M.O. is even shown in the company logo for the local,Swedish company Förmedling M.O.)
3. What about growth-projects? The usage of M.O.-instrument in the current Cyprus-crises would be an introduction of the new kind of financial instrument on the both financial market and politically,but would it solve the needed growth- a condition without which any,longterm solutions for the EU-crises want materialize? Let thats why the Cyprus-state open an open offers-platform for different kinds of growthprojects. The best,2-4 of these could be used on the M.O.-solution of the crises. Let me-as a philosopher-theoretically interested-propose what could these kinds of projects to be,by comparing the kinds with my new causal theory in Theoretical Philosophy (presented in my first version of the thesis-as a student- where I created the grounding ideas for the new paradigm of science,1974):
a. causal step: between project a and b. Project a could lead to project b (cause-effect).As an example building projects: what about new tourism flats in Cyprus-state owned for older people visiting and using different kinds of health care for their health,sent and confirmed by other EU-state health officials?
b. causal path: this kind of projects could be combinations of building,infrastructure investments,better conditions for SME-companies,for different kind of social investments in local,democratic institutions etc.- a local kind of many-dimensional NMEP-growth spiral-a proposal for a new kind of thinking about growth which I made in a student paper in social planning when studying the subject here at the Uppsala university. The idea was accepted in 1981 as an Appendix in my course paper.
c. causal frame-level: this is a kind of macro-level project. As such could be mentioned my proposal for the new model of public sector- Partially Marked Directed Public Sector (PMDPS-model)- which has features of both the leftist (on solidarity) and right wing party emphasis (on incitements),but is not an eclectic product as grounded an a new,many-dimensional view of Man. It? flex-price solution could possibly be used fe.in setting up the rents for "health-flatts" above,and-if founded to give a new kind of state budget-solutions accepted EU-wide?
The selected growth-projects could be either selected one of the kinds above,or-why not- a combination of all by stages: first begin with a-kind,then evolve to b-kind and in the end-lift the M.O.-solution to the c-kind.EU and IMF-officials talk much about ”structural reforms”-but want give clear blueprints how to do it. Here is the recipe from an alternative thinker who haven't got any positive flows back-yet-on his investments when pushing the market to a new direction and believing on the company vision of the new paradigm of science even if not discussed by science or media thus giving the people an opportunity to handle themselves and accept new kind of positive and more fair solutions. Analyzed by concepts of physics the M.O.-solution is a quantum-like solution: either you accept and try it,or not. Analyzed by economic history: the creative solution can be understood as a kind of Schumpeterian solution-with creative destruction-but the current situation in Cyprus is already such a one and my proposal for a M.O.-project kind solution is only showing an alternative way to handle such a kind of situation,made by the EU-leaders and market together. If my proposal would solve the crises and show a way forward even for other states,it would be fair to get a minor percent of the shown results back for the creator.
Locally-in Sweden-the taxing bureau could then roll back its unfair decision when nullifying made,longterm company investments-as they could say that company is now "on the ordinary path" when selling it´s solutions,thus given them and even the local officials in the court of Kammarrätten a social way out. Even the Swedish taxpayers would win by this as the Vidorg private company could be now accepted on the market and start its life on an ordinary way,giving jobb opportunities and accepted as a company,not blackmailed or marginalized by ethnic strategies on the closed market,using old kind of instruments which have not been successful in the new,global market economy,which needs now new kind of theories and solutions based on these.Saying this,what do you say?
Lasse T. Laine
philosopher-social scientist,social entrepreneur and company builder for Vidorg and other private companies in Sweden