Dear Readers,

Letters from the editors.Page 2 Write for us ...Page 3 ACTA..Page 4 Scottish Independence ...Page 5 Occupy London.....Page 6 Labour Pains....Page 7 The Eurozone Crisis: Q&A..Page 8 Technology and Education ..Page 10

It is with pleasure that I present you Tanvi Narayan and Kirti Sharma, who alongside myself, constitute the editorial team of The Schumpeter. David Osborne Dear Readers, Welcome to the ninth edition of The Schumpeter and what an exciting issue we have lined up for you. Everything from hot-button, home grown topics such as Scotland's Independence to the international arena where we take a look at the Eurozone crisis and the creeping powers of on-line copyright legislation. We hope you enjoy reading it as much as we enjoyed putting it together. Also, we would like to say huge thank you to all of you that contributed articles and assisted in getting this issue off the ground. Remember, anyone from any discipline can submit articles so if your passionate about an issue, get writing and send it in! You could be the next Krugman in the making - how do you know unless you start getting your opinions on paper? Lastly, on behalf of all the team we would like to wish you a happy (albeit belated) new year and we wish you the very best for this academic term and the final exams. Kirti Sharma

Tanvi Narayan

Kirti Sharma

David Osborne

ACTA
The internet age crusades
By Steven Perianen

ing the issue. Earlier this month 22 EU member states signed the agreement, including the UK.

The Anti-Counterfeiting Trade Agreement (ACTA) has been a controversial and reoccurring topic that affects internet users worldwide. In January 2012 thousands of protestors took to the streets of Poland following their governments signing of the treaty. Anonymous, an online activist group, has launched a series of attacks on the websites of ACTA supporters. Recently Mr Kader Arif, a key French Euro MP resigned from his post as the rapporteur for ACTA in protest of the treatys hasty progression. With all of the surrounding controversy it has become one of the most high profile agreements of the internet age but what exactly are the fundamental objectives of ACTA and are the blueprints to achieve these aims reasonable?

According to the Organisation for Economic Cooperation and Development (OECD) $250 billion a year of international trade breaches intellectual property rights (IPRs). The purpose of ACTA is to facilitate the international cooperation of practices to uphold these IPRs. ACTA does not create new intellectual property laws or harsher criminal sentences for offenders, instead it is an international framework which makes it harder for a party to breach IPRs. Broadly speaking, the ACTA legal framework stipu- These objectives are not an upheaval to the existing arlates: chitecture of the current Guidelines for civil courts copyright and IP laws, rather and authoritative action ACTA simply aims to provide against a party that is a more unified, global framesuspected of IPR inwork for the existing legislafringement. tion. However, it is not what Customs control that ACTA aims to achieve that is prevents counterfeit the reason for discontent but products from crossing rather how they propose to borders do it. The attention is in the Criminal enforcement detail.

lost one third of its value resulting in reduced investment in new music ventures worldwide. As a result it is predicted that there will be approximately one million creative job losses in Europe by 2015. The European music industry has taken action against piracy independently resulting in the closure of popular file sharing sites such as PirateBay and LimeWire in Italy and Denmark. However, the industry depends on government intervention to fight this war on piracy and it is believed that ACTA will formalise and strengthen the governments ability to assist the industry in these cases.

Formal negotiations on ACTA started in 2008 and the first draft was finalised following multiple deliberations in 2010. ACTA was designed within an independent international body; existing international institutions such as the World Trade Organisation were disregarded as plausible entities to negotiate the agreement due to existing member countries continuously block-

that outlines categories Article 27 of ACTA regarding of infringement and pro- the enforcement of IPRs cedures of prosecution. online requires the states to Enforcing IPRs in the digi- support cooperative efforts tal environment by using with the business community. information collected by The potential issue with this internet service provid- commitment is that it potentially legitimises and promotes ers (ISPs). the policing and even punishThe European Commission ment of alleged infringestated that ACTA is essential ments outside normal judicial for businesses survival and frameworks. A company can that enforcing a global stan- determine to some extent dard would protect European what constitutes as an IPR jobs by reducing piracy; a breach however, in most threat which, if left un- cases these companies are checked would continue to not objective enough to dedevastate industries with shar- termine whether content is able digital content. For in- illegal. Consequently, the act stance, the music industry has

requires internet intermediaries to disclose information on alleged copyright violators, this means mass monitoring of millions of internet users regardless of whether they are under suspicion. This prioritises interests of right holders beyond that of free speech, privacy and other elementary rights.

To date Australia, Canada, the European Union, Japan, Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland and the United States have all signed up to ACTA. The European parliament need to ratify the treaty before it is enforced and the final deliberations are scheduled for June 2012. Whether ACTA will be shot down by In addition, ACTA fails to dispoliticians for fear of public tinguish misuse of protected reprisal, is yet to be seen. property. Requirements defining appropriate punishment can depend on: the commercial scale of the breach, Scottish Independence the economic value gained The divided kingdom by the violator, and the failure of the internet service By David Osborne provider to stop the contravention. Unfortunately, all of For the people of Scotland, these factors are ill-defined. 2014 will be a very exciting For example, if a popular year. Glasgow will host the blogger unintentionally put 2014 Commonwealth Games, multiple copyright-protected Scotlands prestigious Glenimages on his blog, numerous eagles golf club will host the visitors to the blog would re- Ryder cup a few weeks later. sult in commercial scale re- Scotlands First Minister, Alex production of the image. He Salmond of the Scottish Nareceives an indirect eco- tional Party (SNP) has also annomic advantage because nounced that in the autumn he does not pay for the im- of that year, Scotland will ages and his internet service hold another internationallyprovider aided and abet- watched event a referented the infringement by dum on whether to be indenot taking action against this pendent from the United offender. Under the defini- Kingdom. tions of ACTA this blogger and his ISP have conducted criminal offensives, punishable under ACTA and the associated IP laws. This can potentially lead to a systematic, but legally justified censorship attack on a multitude of information sites, blogs and forums which may only be committing minor infractions. Although these sites were not the initial impetus for this agreement, they can and will be in the firing line.

Alex Salmond and the SNP have controlled the Scottish Parliament in the Holyrood area of Edinburgh since 2007 and many of his supporters claim that Scotlands inability to control all of its own affairs is detrimental to its own interests. They grumble that the current level of devolution is insufficient. Holyroods devolved power affects matters such as education, health and prisons, which are dealt with in Scotland rather than at Westminster. This has no effect on the Scottish legal system however, as it has always been different to that of the rest of the United Kingdom. The proposal to hold a referendum in Scotland has featured in the SNP election manifesto since the 2007 elections. The referendum was planned for 2010, but only 50 of 129 Members of Scottish Parliament supported it. With the SNPs landslide victory in 2011, there was a new zeal for this commitment to a referendum. Mr Salmonds referendum proposals do not solely include options for and against independence, but provides

a third option, known as Devo Max which involves having more decisions made in Holyrood. However, the definition of this deep devolution is still very murky. There are many challengers in Westminster.

Many businesses in Scotland are not as sanguine about the economic benefits as Ms Sturgeon and fear that separating from a global economic power into a smaller nation would be detrimental, even if Scotland were to become more integrated into Lord Wallace of Tankerness, a the European Union than the former deputy first minister, in UK currently is. an interview with BBC Scotland stated that, "A referen- Politicians on both flanks in dum that would put in train Westminster are equally lacknegotiations, if it was success- ing in optimism about the inful, to change the union - the dependence. Scotland has relationship of the union be- long been a stronghold for tween Scotland and England the Labour Party and a sepa- that, we believe, is not law ration would jeopardise their because it exceeds the chances in the next General power given to the Scottish Election. The Conservative Parliament under the Scot- Party, despite having comparatively few seats north of land Act." the border is also very comThe UK government offered mitted to defending the unto legislate to provide the le- ion. gal powers to Holyrood to conduct the referendum, but Opinion among the Scottish this would mean holding the population is also divided. A vote on Westminsters terms. recent poll by the Sunday Camerons government Telegraph, stated that 40% would set the questions were in favour of independasked, the date and choose ence, 43% opposed indethe operator of the referen- pendence and 17% were undum. This was rejected by the sure. Scottish government who see 2014 as ideal, as in that year According to the SNP manithe Scottish nation will be festo, an independent Scotcheered on by a series of in- land would be a full member state of the European Union ternational events. but will retain the Scottish According to the Deputy First pound sterling, unless the Minister Nicola Sturgeon of Scottish electorate opts to the SNP, With independ- use the Euro requiring a reference, Scotland will be ranked endum on its own accord. sixth in the world league table Queen Elizabeth II would also of OECD nations in terms of remain the head of state of GDP per head ten places Scotland, which echoes the ahead of the UK at sixteen. Union of the Crowns in 1603. Supporters of Scottish independence also believe that The power is in the hands of this; with the revenue from the Scots. If they choose indethe North Sea oil, Scotland pendence, their nation will would be a safe-haven for have to live with the consequences. A loss will be a investors.

complete blow to the SNP. A challenge lies ahead for Alex Salmond and the SNP; time will tell how well he assumes it.

Occupy London
Misguided nuisance or the beginning of a world revolution?

By Kirti Sharma

Occupy London was one of the most watched news items throughout the end of 2011, an organised throng of peaceful protesters huddled en masse in St Pauls iconic courtyard; the proletariat machine squatting on the doorsteps of the gilded city. But the protesters torch was snuffed out after they were officially evicted on Friday 27th January after a high court ruling by Mr Justice Lindblom. However while the battle at St Pauls might be lost (particularly if the protesters appeal fails) the question remains, how will Occupy London continue to fight their war and more importantly is this war justified?

Occupy London was born from the turmoil of the financial crisis and they aim to be the communitys voice protesting unemployment, privatisation and austerity, to achieve a future free from austerity, growing inequality, unemployment, tax injustice and a political elite who ig-

nores its citizens. However, as with most things this hope for a more utopian society is more easily wished for than accomplished. To move towards achieving these goals the group presented the following proposals to the City of London Corporation in November last year: 1. Publish full, year-by-year breakdowns of the City cash account, future and historic. 2. Make the entirety of its activities subject to the Freedom of Information Act. 3. Detail all advocacies undertaken on behalf of the banking and finance industries, since the 2008 financial crash. As one cannot turn back the hands of time and avoid the crisis completely, this threepoint plan of increased transparency with a focus on future expenditure is a reasonable means to go some way towards insuring society from a repetition of history. If the financial sector, the regulators and the government are reminded of the on-going consequences from the circumstances of the crash and that the issues of increased taxation and rising unemployment are not taken lying down by the public, then

they are less likely to allow the same situation to occur. No one wants a Bolshevik-type up-rising on their watch and small concessions made to meet on a middle ground should avoid a revolution. However it is important to note that while these claims are not yet the blueprint to remove capitalism from society, at their fundamental level Occupy London is an anti-capitalist group and as time goes on it is likely that their proposals will become more extreme to achieve an anti-capitalist solution. Nevertheless, a failure in capitalism does not mean that its antithesis is the solution. For example Communism has been evoked before as a sledgehammer solution to the fatcat capitalist culture and failed miserably; just consider the creation of the Soviet Union which resulted in Civil War, dictatorship and Stalins five-year plan creating widespread famine and a death toll numbering in the millions. In fact even though capitalism within the financial sector has caused the current crisis we face today, another breed of capitalism in the form of new small businesses has been cited as a lifeline to drag the economy out of the

downturn and is potentially a more sensitive and realistic solution than a complete abandonment of capitalism. Another issue with the Occupy London protest is the platform they have chosen to voice their arguments, with their campsites being the focus of sharp criticism. For example the sites at St Pauls, Shoreditch and Finchley have been condemned as being hubs for increased crime and drug use and containers have been installed for the safe disposal of syringe needles. In addition the obstruction of the campsites especially around the St Pauls area has made it increasingly difficult for the restaurants, shops and tourist attractions to operate as normal. It is for reasons such as these that the court ruled in favour of eviction. It is understandable why they have chosen such a high profile location, however their message cannot continue to come at the cost of the businesses in the area. At the very least this is counterproductive to their cause in the long run where they want to see less of a tax burden on the common individual, which can only happen if the businesses continue to turn a profit and pay taxes. In some senses, it will be unfortunate to see the campsite broken up. Especially as the protesters have become a community unto themselves with a vibrant life-force that aims to bring equality through knowledge and opportunities to voice concerns with public forums and lectures. For example, in the St Pauls campsite they have the City University Tent (no affiliation with

our own university) which holds a multitude of events from independent film screenings to lectures on climate change. nancial Sector, Labour has started by listening to the public mood and developing a position that balances the attitudes of the party and the public. In so doing, it has led to Ed Miliband successfully cornering the Prime Minister David Cameron a number of times. From the apparent phone hacking of Milly Dowler to Government-owned bank bonuses and the removal of Fred Goodwins knighthood, Labour has led the position and the outcome of all of these events. And these are by no means insignificant events. But despite showing a strong appreciation of the public mood the public continue to deny Eds abilities. Labour continue to slump in the polls and it becomes more and more apparent as time goes on that they dont disagree with what is being Labour Pains said, simply who is saying it. It By Tom Doherty seems Ed Miliband lacks the presence of a Prime Minister, Last year, Labour unveiled an as his predecessors didnt. economic plan knowing that it will never need to imple- With 3 years until the next ment it. The solutions were scheduled election, Ed may simply recommendations for well have time to prove his short-term problems and by place. But he must stay true the time of the next election to his beliefs. Recently, he none of the points of The 5 and Ed Balls were criticised Point Plan will be valid. It is for their support of Governclear that Labour needed to ment plans for public sector restore credibility and make a pay restraint. He was blasted plan that resonated with the by the unions who supported public mood. This has been a him and by various outsiders recurring theme of Labours for not being the opposition. stance on a variety of plat- In the face of this criticism it is forms. Whether it is Europe, careful to remember that the News International or the Fi- oppositions position is not to Whether one agrees or not with their aims, political ideologies and denigration of the financial sector, it is clear that the group is a remarkable example of human teamwork and action and their deeds are undoubtedly peaceful, honest and wellmeaning and although their days are rightly numbered in their campsites, they should use this last length of leverage they have to make sure their three-point plan becomes a reality. Time will tell how they will continue to keep their profile raised, but in todays internet age and the ability to achieve viral publicity easily and cheaply combined with their already strong, organised and passionate following, it is unlikely this group will fade into obscurity. always oppose, but more often to scrutinise. It is right to support pay restraint over further unemployment and for this Labour must be commended, not attacked. The scar of Labours recent economic history may still be too close to home for some. With millions unemployed, many will blame Labour for their experiences. But with a continuing struggle almost 2 years on into a new Government with the economy on the brink of recession, the public may begin to warm to Labours ideas. The Five Point Plan was an unsuccessful attempt to make them listen, but it was successful in allowing the party to finally have a policy to rally around. Granted not all the points of this plan were sensible or altogether viable, there were parts that resonated with credibility. And more recently the IMF has suggested that countries with room to manoeuvre should use that ability to stimulate growth echoing the suggestions from the opposition benches. Rebuilding Labour may well be a difficult task given the rubble that was left behind. The occasional voice of doubt in Ed Miliband that sounds from the back benches will not be enough to topple him and it seems that Ed will indeed take Labour through to the next election. Ed needs to be bold in changing Labours mind-

set. He must be brave enough to develop medicines that may be hard to swallow if he is sure the patient needs it. The first month of 2012 has been bright for Labour and its leader, if the following 11 are just as good the public will be forced to notice Mr Miliband for all the right reasons.

over the next 20 years. Recent articles by leading academics discussing the EU, the Euro-zone crisis, Camerons stance at last weeks EU summit and the subsequent fall-out in British politics have drawn some of the following conclusions:

in Europe been affected by economic crises in Europe? A: The new treaty proposed by the European Council will be intergovernmental and stand outside existing EU treaties.

Eurozone Crisis: Q&A

By Tanvi Narayan

The growing crisis in the Eurozone threatened to undermine the global economic recovery as markets plunged across the world on fears that European leaders may not be able to contain the debt contagion spreading from Greece. As events in Europe continue to unravel at dramatic speed, academics in European politics at Sussex University have intensified their efforts to provide scholarly analysis of the latest developments as they occur. With the pace of developments outstripping the ability of political leaders to respond, what was initially called as a summit to bless a 110bn (95bn) rescue package for Greece turned into a frantic exercise in global crisis management. There is something, however, that may be even more difficult to believe: the euro debt crisis, for all its power to shake financial markets and the global economy, is just chapter 1 in a story that will run for the next two decades. This crisis is only our introduction to the kinds of wrenching changes that virtually every nation's economy will face

The UK will remain a member of the European Union (EU), Failure in Brussels: The Euro- which is governed by constipean summit has not solved tutional rules set out in the the Euro-crisis and the Euro European treaties. may still collapse, in which case the bust-up in Brussels may not matter quite as much as it seems to right now. The recent European Council meeting announced a plan to negotiate a treaty on fiscal discipline by March 2012 and provided small amounts of additional funding, partly via the International Monetary Fund, to help No one can force the UK to indebted states. But it failed leave the EU. However, the to convince the European UK is now regarded by the Central Bank (ECB) to expand other 26 members, even forits so-called 'quantitative easmer friends such as Poland ing' to buy up bonds of Italy and the Scandinavian counand Spain and others. With tries, as being unreliable, Italy needing to roll-over debt lacking in solidarity and dein early 2012, the monetary structive. union could still collapse. Continental Europe thinks Global impact of any Euro that Mr Cameron tried to uncollapse: A collapse of the dermine efforts to save the Euro would throw not just Euro even though this Europe but much of the rest probably was the last thing of the world into severe rehe wanted to do. So it is cession. unlikely that anyone would The Cameron effect: The move to stop the UK's exit if Prime Ministers decision not that is what the government to work with the other 26 wants. member states to solve the Critics of Camerons stance crisis may be a historical turnargue that the UK has thrown ing point in British politics, away in a few days the politileaving the country isolated cal capital and credibility and ultimately destroying that governments of both not just the current coalition, parties have spent years but if it increases support for building up. independence in Scotland, Q: How will events in Europe the UK itself. impact the UKs coalition Q: How has the UKs position government?

A: Crisis or no crisis, Europe ment's aspiration of reducing would have had the potential the deficit in four or five years to cause the coalition gov- will be a distant memory. ernment a headache. Whether it suffers politically, But Mr Cameron's 'veto' and however, will depend on the Deputy Prime Minister Nick extent to which it can blame Clegg's reaction to it has Europe for all our woes and turned an international crisis whether Labour can come into a domestic drama that up with a credible alternative could spell the beginning of something of which there is the end for a coalition that, as yet little sign. even to many Liberal DemocQ: Why should the UK be anrats and Conservatives, was swerable to the problems of always somewhat counterother EU states? intuitive. A: The UK's financial services On the other hand, the junior industry is actually responsible partner in that coalition has for much of the country's faced humiliation before (on debt and deficit. tuition fees and electoral reform, for instance) without In seeking to protect the inshowing any serious inclina- dustry, Mr Cameron by weakening Britain's position in tion to walk away. Europe more generally may Whether they grumble but actually end up damaging stay right where they are will precisely those interests he depend on whether the bustsought to stand up for. up in Brussels is merely a temporary blip or, as many Con- We also need to consider the servatives hope, an irrepara- paradox that Britain's (and ble tear in the fabric of the Denmark and Sweden's) insisUK's relationship with its EU tence on staying out of the single currency may have partners. made it easier for the rules to Q: What would be the consebe bent by those countries quences of a Euro collapse that did adopt the Euro and for the UK? it was the bending of those A: If the Euro goes down, all rules that led in no small part bets are off. Although UK to the current crisis. banks may not be as exSemi-detachment, or even posed as some of their conticomplete separation, may nental European counterseem like an attractive posiparts, they still stand to lose tion to some but given geobillions. graphical and economic reIf that happens, the credit alities it may be a selfcrunch will get a whole lot defeating stance. 'crunchier'. Exports and output in the 'real economy' will also dip dramatically, offering the prospect that the incipient recession may even turn into a depression. If that happens, the govern-

The Technological Frontier of Education

By Joaquin Thul

When Steve Jobs announced the launch of Apples iPad, he might not have considered the effect on technology he was about to create. Maybe he did know, or maybe he didnt. Truth is that nowadays all technologyrelated companies are planning to launch their competitor to the iPad. However, the surprising thing behind this is the relation between the One Laptop per Child programme and the tablet computer market. One Laptop per Child (OLPC) is a not-for-profit organisation that aims to provide children all over the world with a lowcost, low-power connected laptop in order to help them in their learning process. This programme has been running for the past six years and started by targeting children in developing countries. So far, over 2 million children and teachers from different countries have been provided with an XO laptop (the name given to their laptops). These personal computers are designed with very resistant materials and opensource software which enables them to be manufactured at a very low cost. This does not make them equivalent to toys, these devices are also equipped with features that can be found on a regular laptop, such as USB ports, a webcam, a microphone, speakers and even feature Wi-Fi connectivity. The programme aims to help the learning process of every child, with up-to- date teach-

ing methods based on new like Microsoft, RIM, HP, Panatechnologies. sonic, Dell, Sony, etc., are working on their own tablet This idea was first applied to devices and getting ready to Uruguay, which was the first launch substitutes for the country in the world to proiPad. vide one laptop to every primary-school student. Al- One of the most well-known though it is still too early to concepts in microeconomics see the results of the whole is the principle that supply programme, the primary out- creates its own demand. This come appears to be very is known as Says Law, a conpositive. cept criticised by John Maynard Keynes, and made However a recent report from popular by the French the BBC on the Consumer economist Jean-Baptiste Say. Electronics Show (CES) shows However, the validity of this that the OLPC programme concept still generates a concould be also entering the siderable debate between tablet computer market in classical and supply-side 2012 in order to provide chileconomists. We may try to dren not with an XO laptop, understand the markets rebut rather with a tablet comaction to the iPad in terms of puter. According to the this concept. When Apple OLPCs Chief Technology Ofintroduced its new creation ficer, giving them a tablet the market developed a cercomputer could lower costs tain need to have it. Maybe it and lower the power conwas due to the high level of sumed by each device. The brand-loyalty that Apple users questions now appear to be exhibit for the company, this different: Should OLPC enter product was a huge success. the tablet computer market? Moreover, the iPad is just a Is it really necessary for chilproduct which resembles dren to learn how to use a more a large iPhone with the tablet device instead of a benefit of a few additional laptop? apps. There is no logical exIn order to explain this we first planation to why this new analyse the beginning of this product generated such huge market euphoria for euphoria in consumers, to the tablet devices. When Ama- point that every company zon launched the first edition now wants to sell their own of their e-books reader Kindle, tablet. it was criticised for being a Why would the OLPC procold substitute for regular pagramme, also want to enter per books. However, when into the tablet market? The Apple launched their iPad, OLPC states on their website which in reality is an improved that they consider children all e-book reader device that over the world to be their can connect to the Internet mission, and not their marand play music, it was almost ket. Therefore they should worshipped. Although it was first try achieve their first goal criticised by many, the iPad of providing every child with was the first truly successful a low-cost laptop to help tablet computer. Nowadays them with their studies, all main technology brands

not just equip them with the latest technological fad. CES idea to enter the tablet market only conveys the message that they are more concerned with keeping up with other technology companies rather than achieving worldwide connection for young students. We may say that the creation of this new market for tablet computers by Apple is very appealing for its rivals. It is perfectly logical to understand the other companies willingness to enter in that market and grab a piece of the cake. But it is not that easy to see why a not-forprofit organisation is also trying to develop their tablet for children. The excuse of lower costs or lower energy consumption seems plausible at the first glance, but it becomes less clear once they start negotiating with Microsoft in order to include their operating system on the new versions of the XOs. Education as a growth generating factor is a crucial topic in developing countries and it seems that the discussion now is centred more on technological aspects rather than educational ones. It seems that the main concern is how to develop the latest device rather than how to make the current XO laptops available for every child. The question of whether tablets will help achieve global connectivity for education more successfully than the regular XO laptops is not an easy one to answer. We will only be able to tell once we start seeing this programmes results in the long term.