Russian Financial Crisis in 1998 free essay sample

These events led Russia’s international reserves to fall by $13. 5 billion and to the dissolution of the Kiriyenko government. One month later, Standard and Poor’s downgraded its rating of the Russian ruble to â€Å"CCC,† the lowest possible Standard and Poor’s rating, for its long-term outlook and â€Å"C† for short-term outlook. These events signaled the onset of the Russian financial crisis, which had its roots in the fundamental problems in the Russian economy but was triggered in part by the continuing financial crises in emerging markets in Asia and around the world. What were the causes of this crisis and near financial collapse? What are the so-called â€Å"experts† saying about the crisis and its spillover effects on other ENI countries? What are the possible courses of action that could minimize the adverse effects of the crisis and reduce the likelihood of future occurrences? The purpose of this paper is to summarize the divergent viewpoints expressed by leading scholars and practitioners in the field of international development and finance. We will write a custom essay sample on Russian Financial Crisis in 1998 or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page By surveying the literature, it is apparent that the Russian crisis, and to some extent the Asian crisis that preceded it, was caused by a combination of internal structural problems in the domestic economy (especially in the banking and fiscal systems) and growing problems with the international financial system that permits excessively rapid outflows of capital. However, there is significant divergence of opinion among scholars and practitioners as to which set of factors, those related to the Russian economy or those related to the international financial system, are the cause of the crisis. In addition to the differences of opinion as to the causes of the crisis, disagreement exists as to the remedies to the crisis. As a result, each group has recommended its own set of policy prescriptions. The first section of this paper discusses the divergent opinions on the causes of the crisis. The second section highlights the economic, social, and political effects of the crisis. The third section provides a list of the proposed remedies offered by the divergent camps. The final section summarizes the main findings and includes a timeline of the Asian and Russian crises. Divergent Opinions: Causes of the Russian and Global Financial Crises The divergent views regarding the causes and cures of the Russian and Asian financial crises can be broken down into two camps: (1) those that believe that the crises derived primarily from problems in the international financial system and (2) those that place blame primarily on the structural problems within the countries themselves which left them vulnerable to capital flight and other problems arising from external financial instabilities. Members of the first group tend to be critical of the IMF and other international financial institutions, saying that these institutions played a role in creating and exacerbating the financial crises rather than helping to reduce the negative impact, although the â€Å"fix the system† critics do agree that each of the crisis countries did suffer from internal structural problems as well. The second group of analysts—the â€Å"fix the countries† group—believes that the international financial system and the approach of the IMF in assisting these countries are more or less working, and that the current crises derived from a lack of sufficient regulatory and fiscal reforms in Russia and Asia. â€Å"Fix the Global Financial System† Critics Jeffrey Sachs. According to Sachs, â€Å"the Treasury and the IMF have driven a large part of the developing world into recession†¦And the Brazil case makes absolutely clear that the first step is not to defend overvalued currencies. The punishing cost of this is overwhelmingly high. This is a lesson that the IMF and the Treasury have continued to ignore† (Uchitelle 1999). In his view, the IMF exacerbated the crisis by demanding tight fiscal and monetary policies. He claims that perceiving the crisis to be one of balance of payments, rather than a financial panic, the IMF chose an approach similar to the mistaken policies implemented by the United States in the early stages of the Great Depression of the 1930s (Radelet and Sachs 1999). Furthermore, Sachs insists that since high interest rates and austerity measures are bringing disaster to many emerging markets, interest rates should be kept down to encourage economic activity and allow exchange rates to find their own equilibrium level. He does not attribute the devaluation of exchange rates as a cause of the crisis in Russia, nor does he believe that a currency board arrangement would have saved the country. He states that â€Å"when pegged rates become overvalued, [this] forces countries to deplete their foreign exchange reserves, in a vain defense of the currency peg. † In his view, it was the combination of broken promises (i. e. , the ruble will not be devalued) and depleted reserves that left the country vulnerable to panic (Radelet and Sachs 1999). He believes that a growing economy is more likely to restore investor confidence than a recessionary one burdened by high interest rates (Uchitelle 1999). An additional contributing factor to the crisis, according to Sachs, was â€Å"moral hazard. Investors clearly had doubts about Russia’s medium-term stability, and talked openly about the risk of collapse and about the safety net that they expected the IMF and G-7 to provide to Russia. Knowing that these international lenders would rescue Russia and guarantee investments in the event of a financial meltdown in Russia, international investors tended to underestimate the r isks—and hence tended to over-invest in Russia. Russia was viewed as â€Å"too big to fail,† and this led to an inflow of capital that was larger than appropriate for the actual level of risk (Radelet and Sachs 1999). George Soros. As one of the world’s most successful international investors, an important philanthropist with millions of dollars invested in democracy projects throughout the ENI region, and a public intellectual who has proposed that sweeping changes be made to the international financial system, George Soros is a key figure in the Russian and Asian financial crises. His disparate roles often create a conflict, as Soros-the-intellectual appears to many an advocate of the regulation of international capital flows to prevent potential damages from speculations by people like himself (Frankel 1999). Soros was Russia’s biggest individual investor prior to the crisis in August 1998. He held a $1 billion stake in Svyazinvest, a telecommunications concern, and millions in stocks, bonds, and rubles. In mid-August 1998 Soros sprang into action to try to stop the crisis. He contacted the U. S. Treasury department, influential former members of Yeltsin’s administration, a nd published a letter in The Financial Times saying that the meltdown in Russian financial markets â€Å"had reached the terminal phase† (O’Brien 1998). In his letter, Soros called for immediate action—a devaluation of the ruble and institution of a currency board—that would have eliminated the Russian central bank’s discretion over monetary policy. Not realizing that a letter from Soros would be perceived as coming from Soros-the-investor instead of Soros-the-intellectual, his letter helped to prompt a panic in Russian markets, where investors believed Soros was shorting the ruble. Soros’ funds ultimately lost $2 billion in Russia as a result of the financial crisis there. According to his testimony to the Congressional Committee on Banking and Financial Services on 15 September 1998, Soros pointed out that â€Å"the Russia meltdown has revealed certain flaws in the international banking system which had previously been disregarded† (Soros 1998a). These flaws can be summarized as follows: (1) Banks engage in swaps, forward transactions, and derivative trades among each other— in addition to their exposure on their own balance sheets—but these additional transactions do not show up in the banks’ balance sheets. So when Russian banks defaulted on their obligations to western banks, the western banks continued to owe their own clients. As these transactions form a daisy chain with many intermediaries, and each intermediary has an obligation to his/her counterparty, no simple way could be found to offset the obligations of one bank against another. As a result, many hedge and speculative funds sustained large losses, and had to be liquidated. This systemic failure led most market participants to reduce their exposure to emerging markets all around, and this caused bank stocks to plummet and global credit market to enter a crunch phase. 2) As individual countries attempt to prevent the exodus of capital from their economy by raising interest rates and placing limits on foreign withdrawal of capital (as in Malaysia), this â€Å"beggar-thy-neighbor† policy tends to hurt the other countries that are trying to keep their capital markets open. (3) Another â€Å"major factor working for the d isintegration of the global capitalist system is the evident inability of the international monetary authorities to hold it together†¦ The response of the G7 governments to the Russian crisis was woefully inadequate, and the loss of control was kind of scary. Financial markets are rather peculiar in this respect: they resent any kind of government interference but they hold a belief deep down that if conditions get really rough the authorities will step in. This belief has now been shaken† (Soros 1998a). He also adds that â€Å"†¦financial markets are inherently unstable. The global capitalist system is based on the belief that financial markets, left to their own devices, tend toward equilibrium†¦This belief is false† (Soros 1998a). 3 His proposed cure is to reconsider the mission and methods of the IMF as well as replenish its capital base. Additionally, he’d like to see the establishment of an International Credit Insurance Corporation to help create sound banking systems, which would be subject to close supervision by the international credit agency, in developing countries (Soros 1998b). His last recommendation is to reconsider the functioning of debt-swap and derivative markets (Soros 1998b). Academia and Other Nongovernmental Organizations. Initially, Paul Krugman, an economist at MIT, argued that problems with the Asian economies, combined with corruption and moral hazard, led to wild over-investment and a boom-bust cycle. More recently, however, Krugman explains that such weaknesses cannot explain the depth and severity of the crisis, nor the fact that it occurred in so many countries simultaneously, and instead he places the blame on financial panic and overly liberalized international and domestic financial systems (Radelet and Sachs 1999). According to Krugman, â€Å"all short-term debt constitutes potential capital flight. † The need to fix structural problems in individual countries should not stand in the way of broader macroeconomic measures, in particular those designed to stimulate growth in hard times. He states that â€Å"it is hard to avoid concluding that sooner or later we will have to turn the clock at least part of the way back. To limit capital flows for countries that are unsuitable for either currency unions or free floating; to regulate financial markets to some extent; and to seek low, but not too low, inflation rather than price stability. We must heed the lessons of Depression economics, lest we be forced to relearn them the hard way† (Uchitelle 1999). In other words, the global financial system is largely to blame for the recent crises. Fix the Countries† Analysts IMF. According to the IMF, Russia’s financial crisis was brought on by a combination of (1) weak economic fundamentals, especially in the fiscal area; (2) unfavorable developments in the external environment, including contagion effects from the Asian financial crisis and falling prices for key export commodities such as oil; and (3) its â€Å"vulnerability to changes in market sentiment arising from the financing of balance of payments through short-term treasury bills and bonds placed on international markets† (IMF December 1998). The IMF had pointed out in May 1998 that Russia had made insufficient progress in improving budget procedures and tax systems, establishing competent agencies to collect taxes and control expenditures, clarifying intergovernmental fiscal relations, and ensuring transparency at all levels of government operations. By August 1998, investor confidence in the ability of Russian authorities to bring the fiscal system under control began to decline, immediately leading to the financial crisis, after the Duma failed to approve fiscal measures planned under the augmented Extended Fund Facility (EFF). These measures were aimed at reducing the fiscal deficit, implementing new structural reforms addressing the problem of arrears, promoting private sector development, and reducing the vulnerability of the government’s debt position, including a voluntary restructuring of treasury bills. 4 The extent to which the Russian crisis is attributable to contagion effects from the Asian crisis instead of to internal problems stemming from insufficient reforms in fiscal management is difficult to determine. According to the IMF’s May 1998 assessment of spillover effects from the Asian crisis, Russia’s stock market was seriously hit by the crisis and by early spring 1998, stock prices in Russia had indeed not yet fully recovered from the lows reached in fall 1997. The Russian ruble had also been hit hard and the central bank had to intervene heavily in the foreign exchange market just to keep the currency within the new exchange rate band. As international capital fled from the risky Asian economies in the fall and winter of 1997, investors who were similarly wary of risky investments in the transition economies began to reduce their exposure to Russian and other ENI markets. Nevertheless, emerging market investors quickly began to differentiate between high- and low-risk countries. By first quarter 1998 the Czech Republic and Poland had become relatively attractive to investors, receiving considerable short-term capital inflows and by January 1998 Standard and Poor’s credit rating for Hungary had greatly improved. Russia and Ukraine, on the other hand, continued to suffer from structurally weak financial sectors and an over-dependence on short-term borrowing. To attract investment back into Russia, the Russian government had to raise interest rates in order to offer yields well above pre-crisis levels to cover for the increased perception of risk. As a result, foreign investment had started to flow back into Russia by early 1998. According to the IMF, differences in the severity of interest rate and equity price movements among the transition countries illustrate the importance of appropriate domestic macroeconomic and structural policies to limit vulnerability to international financial crises. In Russia and Ukraine, financial sector weaknesses and a high dependence on government borrowing, in addition to chronic revenue problems, especially in Russia’s case, explain why these two countries were more affected by the Asian crisis than the Central and East European countries. In other words, the Asian crisis exposed Russia’s underlying structural problems and made the need to address them more apparent. The IMF continues to assert that the financial crisis in Russia was a crisis of the state. Nearly a year and a half ago, Michel Camdessus, Managing Director of the IMF, claimed that the Russian state â€Å"interferes in the economy where it shouldn’t; while where it should, it does nothing. Camdessus pointed out that the Russian state needs to make progress in promoting an efficient market economy through transparent and effective regulatory, legal, and tax systems. At present, the IMF still supports these recommendations (IMF November 1998). Existence of a Virtual Economy. Clifford Gaddy of the Brookings Institution and Barry Ickes of Penn State University argue that although the immediate causes of Russia’s financial crisis are the large budget deficit, resulting from nsufficient revenue collection, and an inability to service the debt, especially short-term dollar liabilities, there are more fundamental problems with Russia’s economy. These problems stem from â€Å"illusions† regarding prices, wages, taxes, and budgets that permeate the Russian economy to such a great extent that the economy has become â€Å"virtual† rather than actual. This virtual economy 5 is derived from a public pretense that the economy is bigger and output more valuable than they really are. According to Gaddy and Ickes, the virtual economy primarily originated from the unreformed industrial sector inherited from the Soviet era, in which enterprises produced output that was sold via barter at prices that were higher than they would be if sold for cash. In general, these enterprises operate without paying their bills, as wages that should be paid to employees (but are not paid) become wage arrears, and required payments for inputs (which are also not paid) emerge as interenterprise arrears and payments through barter. In fact, Gaddy and Ickes assert, people make an effort to avoid cash transactions because they would expose the pretense of the virtual economy. They go on to state that although the virtual economy acts as a safety net for Russian society, it has serious economic repercussions since it negatively affects enterprise restructuring, economic performance measuring, and public sector reform (Gaddy and Ickes 1998). At this point, they argue that the West has two choices on how to help Russia. First, the West can concentrate on keeping Russia stable in the short term by bailing out the virtual economy, which will lead to further consolidation of a backward, noncompetitive economy and will guarantee the need for future emergency bailouts. The second option would be to refuse the bailout. The consequences of this option would be drastic—the ruble will lose its value, foreign capital will flee—but on the positive side, the Russian economic policy that is so addicted to borrowing would have to kick the habit as it found its supply of international credit cut off. They state that â€Å"denying Russia a bailout is not without risks. But bailing out the virtual economy is sure to increase those risks for the future† (Gaddy and Ickes 1998). U. S. Government. The U. S. Treasury Department points out that despite the many important reforms that have been carried out in Russia—including extensive privatization, price liberalization, and reduction of government spending—reforms in a few critical sectors have lagged behind, leading to the financial crisis. According to David Lipton, the principal problems include the failure to control the budget deficit and extensive government borrowing. The budget problems are a manifestation of the political struggle over the country’s economic direction and as long as these disputes over the proper role of government remain unresolved, he believes that budget difficulties and unnecessary government borrowing will continue unabated. He also argues that Russia’s high fiscal deficits have led to the country’s high interest rates since â€Å"Russias macroeconomic problem is fundamentally fiscal; interest rates are more properly viewed as a symptom of that problem, not a cause† (Lipton 1998). Lastly, he argues that the failure to build a favorable investment climate and adhere to the rule of law also helped to sow the seeds of the financial crisis (Lipton 1998). The Treasury Department also points to external factors that led to the crisis. According to Deputy Secretary Lawrence Summers, the Russian crisis was not inevitable. He avers that if the Asian crisis had not reduced confidence among emerging markets investors, and had the prices of export commodities (e. g. , oil) not fallen so dramatically—the August 1998 crisis might not have taken place (Summers 1999). Nevertheless, the crisis did occur because the Russian government attempted to pursue an enormously risky course of simultaneously 6 devaluing the ruble, imposing a debt moratorium, and restructuring government bonds in response to the external pressures (Lipton 1998). To avoid future crises, Summers points out that Russia needs a tax system that supports the government and legitimizes enterprises, which probably involves a new allocation of spending and revenues between central and regional governments. Summers, however, is also quick to point out that it is much easier to talk about what tax reforms need to be implemented than to discuss how the reforms can be accepted politically. He adds that bank restructuring is another area where reform is needed and that it should be done in a fair nd transparent way within a legal framework that makes current owners take responsibility for their losses before scarce public funds are used (Summers 1999). Russian Government and Nongovernmental Analysts. Yegor Gaidar, former prime minister of Russia, attributes the crisis to the combined continuation of soft budget constraints from the socialist period along with the weakening of previous administrative controls and government corruption, which led to the ban kruptcy of state enterprises. The early years of transition in Russia were marred by inefficient macroeconomic policy, weak budgetary and monetary constraints, and inflation that eroded budget revenues. Although later macroeconomic policy was more efficient and succeeded in controlling inflation, efforts to improve revenue collection or cut expenditure obligations have failed, leading to unsustainable deficits. The lessons learned here are that budget deficits should be reduced as quickly as possible, as inflation is also controlled, and the vulnerability of exchange rate regimes to potential crises should be addressed immediately (IMF 1999; Gaidar 1999). In terms of the current regime, Gaidar describes Primakov and his government as a â€Å"communist government in post-communist Russia,† because Primakov and his cabinet come from the â€Å"traditional Soviet economics establishment† and his post-crisis approach relies on strengthening and centralizing government control. According to Gaidar, the Russian government faced two possible paths to solve the crisis: (1) return to the approach employed in 1992–94, with soft monetary and budget policies, or (2) maintain a tight monetary policy, stabilize the ruble, and carry out fundamental budget reforms to allow the government to balance revenues and expenditures. The first path would lead to the return of high inflation rates, as the government relaxed its control over the money supply in an attempt to pay its debts, but the banks would benefit from the return of â€Å"cheap money† issued by the Central Bank. The second path would involve speeding up structural reforms, which would be good news for profitable enterprises but would mean painful consequences for unproductive enterprises—mostly firms in the industrial and financial sectors—as they would be allowed to go bankrupt if they could not compete in world markets. Both paths would be painful, Gaidar explains, but the first path of high inflation would also be inequitable, as the poorest layer of society tends to suffer most from increasing prices. Not surprisingly, Primakov chose to pursue a modified version of the inflationary approach, a sort of populist economics policy that had been implemented in many Latin American countries. The reason Primakov opted for this path, as Gaidar states, is because â€Å"in part, the lack of internal and external sources for financing after the 7 dismissal of the Kiriyenko government pushed [the Primakov government] toward choosing the inflationary variant† (Institute for Economics in Transition 1999). Andrei Illarionov, Director of the Institute for Economic Analysis in Moscow, while noting the IMF’s successes with respect to Russia, criticized the IMF for being too willing to compromise on Russian conditionality. Not one of the IMF programs developed in Russia, Illarionov claims, has been executed in full, as a result of the softening and revision of conditions in original agreements. He states that â€Å"decisions to provide financing for Russia, motivated by political rather than economic considerations, have given rise to the problem of moral hazard. As a result, the Russian government became spoiled after being granted unearned financial assistance, and policy became even more irresponsible than before (Illarionov 1998). Finally, Illarionov also criticizes the IMF for offering inappropriate policy recommendations to Russian authorities in two other areas: exchange rate and fiscal policies. The IMF program (mid-1998, pre-crisis) stipulated that the exchange rate policy should remain unchanged for the remainder of 1998, in order to preserve the low inflation rates, and prescribed that the Russian government should concentrate mainly on raising revenue rather than reducing expenditures. Although many poor 9 O c t 9 8 J u l 9 8 A p r 9 8 egaw muminim laiciffo J a n 9 8 O c t 9 7 .9991/20 ,PECER :ecruoS J u l 9 7 A p r 9 7 J a n 9 7 Dissatisfaction over the continuing problem of wage arrears led to an increase in strikes throughout the country toward the latter part of 1998; 1873 strikes were registered in December 1998, nearly 3. 4 times the number during the previous December. aissuR ni ecnetsisbuS dna ,snoisneP ,segaW ecnetsisbus woleb era % 92 level ecnetsisbus laiciffo ecnetsisbus woleb era % 12 0 001 002 003 004 005 006 007 008 R u bl e s p e r m o n t h . eople have become poorer, the impoverishing effects of the crisis have also hit other groups within Russian society. Workers involved in the business of selling imported goods have found that demand for their products has nearly evaporated as not only consumer incomes have fallen, but also ruble depreciation means higher prices on imports. As a result, many of these trade businesses have shed labor or closed. One of the longer-term consequences of the economic crisis in Russia may be the strain on society, which is likely to weaken the Russian government’s ability to continue to push for reforms. In some ENI countries, the crisis has given reform skeptics an excuse to abandon or reverse some reforms already implemented. The social pressure against further economic reforms, now seen by many as the cause rather than the cure for the economic crises, may become strong enough to counter-balance the pro-reform force. It may lead some ENI countries to get stuck in what Adrian Karatnycky describes as a â€Å"state of stasis† rather than of transition. Stability Versus Democracy Politically, the financial collapse has weakened Russia vis-a-vis the west, but its relative power in the region has in many ways increased. Not only has the crisis given Moscow an excuse to consolidate power over the regions throughout Russia, but it has also allowed many hard-liners within Russia to gain some ground in their push to reassert Russia’s traditional sphere of influence. In addition, many neighboring regions have found themselves with large arrears on their payments to Russia for natural gas deliveries, and have had to strike deals with Russia to find ways to settle these debts through deliveries of food and other barter arrangements. Following the onset of the crisis in August, the Russian government proposed many changes intended to promote economic stability at the cost of democracy. In February 1999, Prime Minister Primakov argued that Russia’s governors should be appointed by the President, rather than elected by their constituents, so that Moscow can take back control over the regions and avoid a collapse of the country. President of Belarus Alyaksandr Lukashenko rejoiced in the crumbling of IMF-backed reforms in Russia, considering the crisis to be a indication of his position in favor of state planning and price controls. The old proposal regarding a possible political union of Belarus, Ukraine, and Russia has also resurfaced, as Russia and some neighboring countries have concluded that further integration will help solve their problems. In the words of Ivan Rybkin, President Yeltsin’s envoy to the CIS, â€Å"the recent crisis taught us all that we must stand together in order to surviveâ₠¬  (Rutland 1999). Effects on Neighboring Countries The drop in real wages in Russia—coupled with the devaluation of the ruble—has translated into dramatically reduced Russian imports. For the neighboring countries that depend on Russia as a market for their exports, the shrinking market in Russia has been disastrous for their local economies. As Russians are shifting consumption away from the relatively more expensive imported goods, the producers of these goods in neighboring countries are faced 10 with a dramatic fall in demand for their products. This has translated into falling output and increased unemployment for the countries that are most closely tied to Russia through trade, especially Moldova (more than 50 percent of Moldovan exports go to Russia); Belarus, Ukraine, and Kazakhstan, (gt;33 percent of exports to Russia, as of early 1998); and Georgia (gt;30 percent of exports to Russia) (EC 1999). The drop in remittances from nationals living in Russia has led to decreased incomes in neighboring countries with large numbers of gastarbeiter working in Russia. Armenia, Georgia, and Azerbaijan have been most severely hit by this decline in remittances. In some cases the pattern seems to have been reversed, with families in neighboring countries now supporting relatives living in Russia (EC 1999). Finally, food prices have also increased in the neighboring countries of the NIS, as the cost of imports from outside Russia has risen as a consequence of the significant devaluation of local currencies. Some of the specific effects and impacts on other NIS and neighboring countries are summarized briefly below. Armenia—Accumulation of public sector arrears is likely, as government is facing difficulties in financing of education, health care, and other expenditures. Remittances from Armenians in Russia have decreased, placing additional pressure on family support systems, and this could result in increased poverty. Azerbaijan—Trade-related consequences in the short term are less than for other NIS countries, as the political instability in the North Caucasus region has already limited trade ties with Russia prior to the crisis. Government spending was cut in 1998, and further cuts in 1999 will affect key social sectors. As in other Caucasus countries, decreased remittances from Azerbaijani nationals residing in Russia has reduced family incomes in Azerbaijan. Baltic Region—Estonia, Latvia, and Lithuania—The Russian crisis forced some Baltic banks to fail, and several others to reveal their under-reporting of exposure to Russia in their September 1998 quarterly reports. Better developed financial systems, a reorientation toward western markets, and general political stability have helped to limit the damage and contagion effects from the Russian crisis. Belarus—One of the most affected countries in the NIS, Belarus was highly dependent on trade with Russia prior to the crisis. Exports to Russia plunged from $400 million/month in the first half of 1998 to just $170 million/month by September 1998. Shortages of basic foods forced the government to introduce rationing. Georgia—The Russian market accounted for 30 percent of Georgia’s exports prior to the crisis, and Georgian nationals living in Russia provided a significant amount of income to Georgian families through remittances. The trade deficit with Russia widened to 50 percent in October 1998, forcing the Georgian authorities to float the lari (which led to a sharp depreciation). 11 Kazakhstan—In the first half of 1998, half of Kazakhstan’s exports went to Russia, and the impact of the crisis has been felt in Kazakhstan primarily through the reduction of exports to Russia. Kazakhstan introduced a temporary ban on the import of some Russian foodstuffs, in order to control the inflow of cheapened Russian goods following the depreciation of the ruble. Kyrgyzstan—Nearly 60 percent of Kyrgyzstan’s exports went to Russia, prior to the crisis, so this country was also one of the more vulnerable to negative shocks through the trade mechanism. In this most pro-reform of the Central Asian Republics, price liberalization of utilities and privatization may be threatened, as consumers are less able to pay the higher tariffs as a esult of fallen incomes. Moldova—Trade with Russia is important to Moldova, as 50 percent of Moldovan exports went to Russia prior to the crisis. Many farms and other agro-exporters have been unable to pay wages, as their export market has dried up in Russia. Here, too, the crisis has threatened the reform and liberalization process implemented by the government, as investors’ interest in the Moldovan economy has diminished and a heavy withdrawal from commercial banks have signaled a lack of confidence in this country. Tajikistan—Low commodity prices for cotton and gold had already damaged the Tajikistan economy before the Russian crisis, and the fragile peace held together in part with the support of the Russian military (serving as border guards) has certainly not gained strength from the crisis. Apparently, Tajikistan is not as dependent on trade with Russia as other NIS countries, and this has helped to insulate Tajikistan from the direct effects of the crisis. Turkmenistan—Exposure of Turkmen banks to Russian markets has been limited, as the Turkmenistan economy is tightly controlled by the state. The Russian crisis therefore is not expected to have a strong direct impact on Turkmenistan. Ukraine—Closely linked to Russia through trade and financial ties, Ukraine has suffered greatly as a result of the Russian crisis. The hryvnia lost half its value against the dollar following the crisis, and reserves have fallen (as of early 1999) to only one month of imports. Inflation surged to 12. 8 percent in October 1998 alone, following a long period of relatively stable inflation before the onset of the crisis (2 percent inflation in first half of 1998). Uzbekistan—As Uzbekistan has been gradually reorienting its international trade profile away from Russia over recent years, the country has apparently been less affected by the crisis than other NIS countries. Further, the underdeveloped banking system and financial markets in Uzbekistan may have helped to insulate that country from the shocks emanating from Russia in August 1998, as Uzbekistan had relatively little exposure to Russia’s financial markets. 2 Proposed Remedies As discussed throughout this paper, two camps have emerged in academic and policy circles that seek to explain the causes of and remedies for the Russian financial crisis. This section highlights some of the remedies proposed by each camp. According to the â€Å"fix the countries† critics, such as the IMF and the U. S. Treasury Department, the Russian government must continue pushing for reforms in the public finance and banking sectors. According to Gaddy and Ickes, only two options exist for western creditors and international financial institutions: keep Russia stable in the short-term by bailing out the virtual economy or refusing a bailout. Denying Russia a bailout would have negative effects in the short-term by leading to the demise of large commercial banks and oligarchs, foreign capital flight, and currency devaluation. In the long run, however, Gaddy and Ickes prefer this option because they believe it will force Russia to adjust to economic life without a steady supply of credit available and adapt sound economic policies. They dislike the first option simply because they believe it will lead to the further development of a nonmarket-oriented economy that would require bailouts in the future. The Treasury Department adds that bank restructuring and reforms in tax administration and collection are necessary as well. The â€Å"fix the global financial system† critics, such as Jeff Sachs and George Soros, urge that the international financial system be reformed so that short-term borrowing by banks and governments be limited so as to avoid potential investor panics. In addition, Sachs recommends that domestic banking regulations, in the form of enhanced capital adequacy standards and policies that encourage partial bank-sector ownership by foreign capital, be implemented in order to limit vulnerability of the domestic economy to foreign creditor panics, and that exchange rates be kept flexible instead of pegged. In addition to these proposed remedies, others have gone further to propose mechanisms for recovering losses (Sexton 1998). According to Sexton, foreign creditors have at their disposal four mechanisms to recover losses to Russian firms: 1. Convertible debt securities: debtors could issue convertible bonds to creditors although Sexton argues that this probably won’t work too well in Russia 2. Treasury or redeemed shares: company may exchange its own shares, that were bought back, or interests to extinguish outstanding indebtedness; there should be no tax consequences to debtor on repurchase of shares; on resale to foreign creditor, debtor should be taxed on any gain on shares or should be able to deduct any loss sustained 3. Alternative debt refinancing structure: swapping debt for convertible debt which creditor converts into equity; issue by debtor to creditor of convertible bonds as a means of refinancing outstanding debt; creditor should make sure conversion ratio covers value of outstanding debt over term of loan; disadvantage to this 13 strategy is that creditor is refinancing and likely to have twice the outstanding debt for some time 4. Securitizing the debt: convert debt into security which creditor then contributes to debtor’s charter capital to pay for the shares (key issue facing creditors thinking of taking equity in a Russian debtor company in exchange for indebtedness is how to value that equity) Summary This paper has addressed the opposing views as to the causes of and remedies for the Russian financial crisis. †¢ Two central camps have emerged. One camp argues that the Russian economy has severe structural problems that were the primary cause of the crisis: fiscal deficit, banking sector problems. The other group points to the IMF and the problems with the international financial system, claiming that moral hazard problems led investors to underestimate the risk of investing in emerging markets such as Russia, and that unregulated short-term investment flows out of emerging markets can result from the panic. Each of these groups proposes different remedies for the crisis, based on their assessment of the roots of the crisis. The IMF and Treasury Department insist that the Russian government continue to push for reforms in public finance and the banking sector, claiming that weaknesses in these areas ultimately led to the onset of the Russian crisis. Jeffrey Sachs, George Soros, and others who are critical of the international financial systems and the role of the IMF in the recent financial crises, recommend that the short-term borrowing by governments and banks in emerging markets be limited and regulated, and that exchange rates are flexible rather than pegged. †¢ Although the worst of the Russian crisis may have already passed, as the Russian and other ENI stock markets appear to have recovered and the dramatic fall in production has been reversed, the original causes of the crisis still need to be addressed. Continued progress in banking and fiscal reforms in Russia will be necessary to ensure that the country is less vulnerable to future external shocks and foreign creditor panics. Improvements in these sectors would help restore investor confidence in the Russian economy and reverse the current outflow of capital. 14 ANNEX: What Happened in Russia? A Brief Chronology of Events Asian Crisis: Precursor to the Russian Crisis †¢ †¢ July 1997, Thailand—devaluation of Thai baht December 1997, Korea—devaluation of Korean won †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ ate October 1997— Pressure on ruble intensifies, as result of Asian crisis December 1997—Foreign exchange pressure temporarily recedes in Russia 19 December 1997—Standard and Poor’s Sovereign Ratings of Russian ruble: longterm—â€Å"BB-â€Å"; outlook—negative; short-term—â€Å"B† January 1998—Reemerging p ressure on ruble forces Central Bank to raise interest rates, increase reserve requirements on foreign exchange deposits, and intervene on ruble and treasury bill market March 1998—Stock market prices in Russia have not yet recovered from lows reached in late fall 1997 May 1998—Russia places major commercial bank under Central Bank administration; miners strike over wage arrears; Russia continues to intervene on foreign exchange markets to support ruble, but investors increasingly see this strategy as unsustainable Late May 1998—Interest rates in Russia increased to 150 percent; Russian government announces revisions to 1998 budget, including 20 percent cut in expenditures and new initiatives to boost revenues Early June 1998—Recent policy announcements temporarily ease tensions, allow partial reversal of earlier interest rate hikes 9 June 1998—Standard and Poor’s Sovereign Ratings of Russian ruble: long-term— â€Å"B+â€Å"; outloo k—stable; short-term—â€Å"B† Late June 1998—Russian authorities unveil anti-crisis program, aimed at boosting tax revenues, cutting expenditures, and speeding up structural reforms . 9991 lirp A , eci vre S et aR egn ahc xE CIFI C AP : ecruo S 15 4 / 2 / 9 9 3 / 2 / 9 9 2 / 2 / 9 9 1 / 2 / 9 9 1 2 / 2 / 9 8 1 1 / 2 / 9 8 1 0 / 2 / 9 8 9 / 2 / 9 8 8 / 2 / 9 8 7 / 2 / 9 8 6 / 2 / 9 8 5 / 2 / 9 8 4 / 2 / 9 8 3 / 2 / 9 8 2 / 2 / 9 8 1 / 2 / 9 8 03 Russian Crisis Timeline 0 5 01 51 02 52 After the devaluation of the Thai baht in July 1997, one Asian country after another had to raise interest rates sharply to avoid currency devaluation. But the combination of high interest rates and currency depreciation, which inflated the burden of foreign debt, provoked a financial crisis (Krugman 1999). SU$/selbuR :etaR egnahcxE elbuR †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ †¢ 16 1 2 / 2 0 / 9 8 9 / 2 0 / 9 8 6 / 2 0 / 9 8 3 / 2 0 / 9 8 1 2 / 2 0 / 9 7 9 / 2 0 / 9 7 6 / 2 0 / 9 7 3 / 2 0 / 9 7 1 2 / 2 0 / 9 6 .9991 lirpA ,semiT wocsoM :ecruoS 9 / 2 0 / 9 6 6 / 2 0 / 9 6 3 / 2 0 / 9 6 1 2 / 2 0 / 9 5 9 / 2 0 / 9 5 6 / 2 0 / 9 5 3 / 2 0 / 9 5 1 2 / 2 0 / 9 4 9 / 2 0 / 9 4 6 / 2 0 / 9 4 0 †¢ 003 †¢ xednI semiT wocsoM :egnahcxE kcotS naissuR †¢ Mid-July 1998—Russian authorities introduce additional policy package, in the context of an IMF agreement on an augmented Extended Fund Facility (EFF) arrangement 20 July 1998—IMF releases first $4. 8 billion tranche of $22. billion extra credit pledge, as policy package is approved by IMF Late July 1998—Initial effects of this package are positive, with equity prices rebounding 30 percent, treasury bill rates falling from 100 to 50 percent, and a low ering of the Central Bank refinancing rate from 80 to 60 percent Early August 1998—The Duma fails to approve new reform program; President forced to veto several Duma measures and introduce others by decree 13 August 1998—Standard and Poor’s Sovereign Ratings of Russian ruble: longterm—â€Å"B-â€Å"; outlook—negative; short-term—â€Å"C† 14 August 1998—Average treasury bill rates are about 300 percent, international reserves down to only $15 billion, and Russian banks are unable to meet payment obligations Russia on the verge of full-scale banking and currency crisis 15 August 1998—Boris Yeltsin announces that there will be no devaluation of the ruble 17 August 1998—Russian government defaults on GKO Treasury Bonds, imposes 90day moratorium on foreign debt payments, abandons ruble exchange rate corridor 17 August 1998—Standard and Poor’s Sovereign Ratings of Russian ruble downgraded: long-term—â€Å"CCC†; outlook—negative; short-term—â€Å"C† 21 August 1998—Russia’s international reserves fall to $13. 5 billion, after renewed heavy intervention in an effort to support the weakened ruble 26 August 1998—Following heavy intervention, the Russian Central Bank announces that it will stop selling U. S. ollars, and suspends trading of ruble on main exchanges Late August 1998—Kiriyenko government is dissolved, financial crisis intensifies 1 September 1998—Russia is the IMF’s largest borrowe r, with a combined total of credits at this date equal to nearly $18. 8 billion 2 September 1998—Russian Central Bank abandons exchange rate band, lets the ruble float 16 September 1998—Standard and Poor’s Sovereign Ratings of Russian ruble: longterm—â€Å"CCC-† [lowest possible S and P rating]; outlook—negative; short-term—â€Å"C† January 1999—Moody’s assesses financial strength (â€Å"E†) and credit ratings (â€Å"Ca†) of the Russian banks at the lowest possible levels; most banks are insolvent (or nearly so) 005 054 004 053 052 002 051 001 05 †¢ †¢ †¢ 15 January 1999—The Central Bank of Russia re-launches trading on the domestic debt market. The new securities are to be used in the restructuring of frozen GKO and other debt instruments 27 January 1999—Standard and Poor’s Sovereign Ratings of Russian ruble: Longterm—â€Å"Selective Default†; outlook—â€Å"Not Meaningful†; short-term—â€Å"Selective Default† 5 February 1999—The 1999 budget was passed by the Duma in its fourth and final reading. The budget estimates a 2. 5 percent budget deficit, and assumes that the government will receive $7 billion in external loans to help finance foreign debt service 17 BIBLIOGRAPHY European Bank for Reconstruction and Development (EBRD). March 1999. â€Å"Overview on Developments in the Operating Environment,† mimeo. European Commission (EC). 20 January 1998. â€Å"The Russian Crisis and Its Impact on the New Independent States and Mongolia. † Communication of the European Commission to the Council and the European Parliament. [http://europa. eu. int/comm/dg1 a/nis/russian_crisis_impact/1. htm] Frankel, Jeffrey A. 1999. Soros’ Split Personality: Scanty Proposals from the Financial Wizard. † Foreign Affairs 78 (2): 124-130. Gaddy, Clifford G. , and Barry W. Ickes. 1998. â€Å"Russia’s Virtual Economy. † Foreign Affairs 77 (5): 53-67. Gaidar, Yegor. February 1999. â€Å"Lessons of the Russian Crisis for Transition Economies. † Institute for Economies in Transition on-line publication. Illarionov, Andrei. 1998. â€Å"Russia and the IMF,† testimony prepared for hearing of the General Oversight and Investigations Subcommittee of the Banking and Financial Services Committee of the U. S. House of Representatives, 10 September. International Monetary Fund (IMF). 1999. IMF Survey. Volume 28, Number 4. International Monetary Fund. May 1998 and December 1998. World Economic Outlook. International Research and Exchange Board (IREX). 1998. â€Å"Russia’s Economic Crisis and Its Effect on the New Independent States,† a discussion report summarizing conclusions of an IREX policy forum held on 18 November. â€Å"Kommunisticheskie pravitel’stvo v postkommunisticheskoi Rossii: pervye itogi i vozmozhnye perspektivy [Communist Government in Post-Communist Russia: Initial Results and Possible Perspectives]. † 1999. Working Paper Series. Moscow: Institut ekonomiki perekhodnogo perioda [Institute for Economies in Transition]. Krugman, Paul. 1999. â€Å"The Return of Depression Economics. Foreign Affairs 78 (1): 5674. Lipton, David. 1998. â€Å"Treasury Undersecretary David Lipton Testimony Before the House Banking General Oversight and Investigations Subcommittee on Russia,† RR-2673, 10 September. Odling-Smee, John. 1998. â€Å"The IMF Responds on Russia: A Letter to the Editor,† 30 November. 18 O’Brien, Timothy. 1998. â€Å"George Soros Has Seen the Enemy. It Looks Like Him. † The New York Times, 6 December: . Phillips, Michael M. 1999. â€Å"Apocalypse? No. Round the Globe, Signs Point to Final Days of Financial Crisis. † The Wall Street Journal, 14 April: . Radelet, Steven, and Jeffrey Sachs. 1999. â€Å"What Have We Learned, So Far, From the Asian Financial Crisis? Paper sponsored by USAID/G/EGAD under Consulting Assistance on Economic Reform (CAER) II Project. Robinson, Anthony. 1999. â€Å"Russia: Coming in from the Cold. † The Banker 149 (877): 4849. Russian European Centre for Economic Policy (RECEP). 1999. â€Å"Russian Economic Trends. † Monthly Update, 10 February. Russian Market Research Company (RMRC). 1998. â€Å"Business Barometer Survey: Moscow, October 2-3, 1998,† published on the American Chamber of Commerce in Russia website. Rutland, Peter. 1999. â€Å"Moscow Casts a Long Shadow. † Transitions 6 (3): 27-31. Sexton, Robert. 1999. â€Å"Turning Russian Debt into Equity. † Euromoney no. 357: 75-76. Smirnov, Mikhail. 1998. Rubl’ kaput ili kak bank Rossii opustil rubl’ [The Ruble is Kaput, or, How the Bank of Russia Lost the Ruble],† National’naia sluzhba novostei [National News Service]. Soros, George. 1998a. Testimony to the Congressional Committee on Banking and Financial Services of the U. S. House of Representatives, 15 September. Soros, George. 1998b. â€Å"The Crisis of Global Capitalism: Open Society Endangered,† remarks before the Council on Foreign Relations, New York, 10 December. Summers, Lawrence H. 1999. â€Å"Russian and the United States: The Economic Agenda,† remarks by Deputy Treasury Secretary Lawrence H. Summers at the U. S. -Russian Investment Symposium in Cambridge, MA, 14 January. Uchitelle, Louis. 1999. â€Å"Crash Course: Just What’s Driving the Crisis in Emerging Markets? † The New York Times, 29 January: . 19

Free Essays on Techniques Of Crime Scene Investigation

Chapter Three of â€Å"Techniques of Crime Scene Investigation,† provides some very detailed information of the importance of crime scene investigators and their duties. Although there are many officers that police departments use today including patrol officers and detectives, when a serious crime occurs police agencies usually use specialist, such as crime scene investigators, fingerprint specialist, or forensic scientist. This does not eliminate the patrol or uniformed officers though because they are use for less serious/important crimes. This process of calling in specialist is not to make any other officer feel that they can’t do the job, but when dealing with homicides, rapes, assaults, and robberies, specialists with more training and experience are needed for pertinent reasons and finding evidence. Because defense attorneys, today, can argue whether or not the evidence was collected correctly or tampered with, it is important to have someone experienced there to get the job done correctly. Although specialist can also make mistakes, it is believed there will be less mistakes made if officers who are extensively trained are called in to process the crime scene. Crime scene investigators are reliable for reconstructing the crime, sequencing the events, determining how the crime was committed/operated, provide motive, notice what, if anything was stolen, find everything the criminal has done, and recovering all physical evidence. The crime scene investigator has similar responsibilities as the first officer to arrive on the scene. When approaching the scene, investigators should be alert for discarded evidence, expect the worst, and upon entering be prepared to take notes as to possible approach/escape routes. Once the investigator has done the important things upon arrival they are to secure and protect that scene while they are there. This may include taking control, ensuring security of the scene, obtaining i... Free Essays on Techniques Of Crime Scene Investigation Free Essays on Techniques Of Crime Scene Investigation Chapter Three of â€Å"Techniques of Crime Scene Investigation,† provides some very detailed information of the importance of crime scene investigators and their duties. Although there are many officers that police departments use today including patrol officers and detectives, when a serious crime occurs police agencies usually use specialist, such as crime scene investigators, fingerprint specialist, or forensic scientist. This does not eliminate the patrol or uniformed officers though because they are use for less serious/important crimes. This process of calling in specialist is not to make any other officer feel that they can’t do the job, but when dealing with homicides, rapes, assaults, and robberies, specialists with more training and experience are needed for pertinent reasons and finding evidence. Because defense attorneys, today, can argue whether or not the evidence was collected correctly or tampered with, it is important to have someone experienced there to get the job done correctly. Although specialist can also make mistakes, it is believed there will be less mistakes made if officers who are extensively trained are called in to process the crime scene. Crime scene investigators are reliable for reconstructing the crime, sequencing the events, determining how the crime was committed/operated, provide motive, notice what, if anything was stolen, find everything the criminal has done, and recovering all physical evidence. The crime scene investigator has similar responsibilities as the first officer to arrive on the scene. When approaching the scene, investigators should be alert for discarded evidence, expect the worst, and upon entering be prepared to take notes as to possible approach/escape routes. Once the investigator has done the important things upon arrival they are to secure and protect that scene while they are there. This may include taking control, ensuring security of the scene, obtaining i...

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Opening of Rohan Stores in Iran Assignment Example | Topics and Well Written Essays - 4000 words

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Issues Caused by Prison Overcrowding

Issues Caused by Prison Overcrowding Overcrowding: One of the important goals in prison system is that it should guarantee the public safety, prison inmates and staff. (Criminal justice and behavior) holding more prisoners than it is intended to accommodate, then the level of overcrowding in different continents andregions can be shown in terms of the occupancy rate*/the number of prisoners as apercentage of the official capacity of the system  (prison health care and the extent of prison overcrowding) In North and Central America, this is true of nine of the 12 countries on which information is available, as it is of 13 out of 14 Caribbean countries and 12 of the 13 countries in South America.(prison health care and the extent of prison overcrowding) Overall, the prison systems of 109 of the 158 countries on which information is available*/69%*/hold more prisoners than they are intended to accommodate. Over the 6 years since the first edition of the World Prison Population List appeared, the latest information available shows that prison populations have risen in 71% of these countries*/in 62% of countries in Africa, 74% in the Americas, 87% in Asia, 67% inEurope and 69% in Oceania Crowding Can be measure in the floor space per prisoner, prisoner per living unit and institutional population relative to state capacity According to BOP, the population increasing in prison are contribute to the longer sentencing over times for inmates From the GAO, it claimsthatthe population of BOP will increase more than the system Capacity such as they predict thatit will be increasing the additional 15 percent of inmates’ population in the BOP. The number of females inmates housed in bop institution increased 7 percent and the number of the males inmates housed in bop institution increased 10 percent. 48 percent for sentencing drug The problem of overcrowding: Overcrowding can be toxic for the both of the prisoners and staff Lack of privacy, lost to use of gyms and recreation, noise, unsanitary ,there are long lines for the toilet ,poor condition in the prison situation The United Nations ‘‘Standard Minimum Rules for the Treatment of Prisoners’’ state that: ‘‘Allaccommodation for the use of prisoners and in particular all sleeping accommodation shallmeet all requirements of health, due regard being paid to climatic conditions andparticularly to cubic content of air, minimum floor space, lighting, heating and ventilation’’(prison health care and the extent of prison overcrowding) It is equally well recognized that, by contributing to health problems in prison, overcrowding is also contributing to health problems in the community, since the vastmajority of prisoners will return to the community in due course, accompanied by anydisease that is then afflicting them Prisoners: Mental health When overcrowding exceeds this figure, the risk to the health of prisoners is obviously greater still. In 67 of the 158 countries on which information is available, the occupancy rate exceeds 120%, including more than 70% of the prison systems in Africa, the Caribbean and South America, and at least 60% of those in Asia and Central America. Indeed, in almost a quarter of the prison systems (22%) The occupancy rate exceeds 150%, and in 15 countries (almost 10%) it exceeds 200%,meaning that more than two prisoners are occupying space intended for one. From the representation of World Health Organization: ‘‘Overcrowding is an obvious cause or contributory factor to many of the health problems inprison, most notably communicable diseases and mental health, including the use ofpsychoactive substances’’( prison health care and the extent of prison overcrowding) Suicide (for the long-term)( which level of security) Self-harm Infraction and stressful. (Prison Crowing A psychological perspective) Human rights and the prison system should have reasonability to keep inmates mental and physical health( Overcrowding in Prisons A Health Risk in Need of (Re)consideration) Poor prison life associate with the mental health such as self-harm, suicide and violent behavior and all of have major implication can affect the inmates and staff. (Criminal justice and behavior) In the long term, this is cause of the high reoffending rates as the mental health, misconduct behavior are associated with the increasing the risk of recidivism (Criminal justice and behavior) (Criminal justice and behavior) Also, the research finds that the linked the overcrowding in prison with increasing the psychological problem such as suicide, rates of violence hypertension and other medical conditioning. The rehabilitation program have been dismantled as the program have never work because the program are underfund and the high unemployment rates make the inmate post-release adjustment are more difficulty (trauma)à ¯Ã†â€™Ã‚   CAN ARGUE Gaes (1992) found that the stress of crowding and the straggle for resource, space and create the nervous atmosphere can increase the chance of suicide and other formed violence. People always argue that rehabilitation and the mental care programmer can addressthe problem of suicide. However, there are limited setting and space to provide the rehabilitation program for inmates in the overcrowding prison. (HUYEN) Stress->the data provide strong for the conclusion that dormitory crowding is the stressor and is detrimental to health. The relationship of housing of the relationship of autonomic nervous system responses to crowding and by examination of urine chemistry correlates of adrenal catecholamine.P45 There is another importance source of information about health-related problem that can illuminate the extent to which crowded prison conditions are associated with physical and mental pathology-the data on serious health-related incidents such as natural deaths and suicide from the prison archives. P46 The data show that there are the illness of headaches, sleeplessness and blood pressure in the short-term.P46 Crowding could produce stress and that prolonged stress could lead to serious physical and psychological consequence. P46 Evaluating the relationship pf crowding – assessing impact of changes in population over times, assessing difference between large and small institutions within particular prison system. Even when the institutions are equally crowded , thebook find that regarding crowding assume that because of greater socialidentity , the large institutions would yield relatively greater stress and consequently a greater incidence of health-related problems as the increase population within a prison would be reinteraction within the living quarters and or in common use areas.P46 Although the stress can have a direct effect on physical health, it may also have dramatic effects on mental health. ] The disciplinary infraction-> the stress related population pressure in the high density institutions may result in a variety of pathological consequence. If population level is important, the large institutions would be associated with more population-related stress than the small one. In the large institution, housing may not be more crowded, but external activity areas may be more densely populated In the criminal justice behavior, it found that there are strong relationship between the institution infraction and the misconduct behavior such as aggression, impulsiveness and the risk of institution. Also. The large of population in the high security housing, it will be high rates of infraction with the gang activities. Physical health Blood pressure Finding the single cell in us now D, Atri (1975) found that the dormitorities were associated with the elevated blood pressure compare with the single cell housing(P45) In the high population years compared with the low population years, the death rates, it should include those from thediseases of the circulatory system were significantly higher for those over 45years of the age. (ARG) The book analyses indicated that deaths from the natural cause for inmates older than 50years of age increased much more rapidly than the population changes. THE population increased slightly be over 90percent, while the death rates increased by over 200percent P49 Misconduct behavior—public safety From the GAO report, it can find that overcrowding may cause to increase the misconduct behavior with prisoner and it should be more competition of education and training. (The problem of overcrowding) Recidivists, but no reconviction rates The overcrowding will continue increase as the reform policy such as street safety Post release (Overcrowding in Prisons A Health Risk in Need of (Re) consideration) Costs The budget of the mental service Meaningful programmes Increasing the population of prison may cause the overcrowding and affect the relationship between the staff and inmates, prison safety, the condition of confinement and themeaningful programmer for prison. (Criminal justice and behavior) On the other hand, overcrowding can reduce the meaningful work chance to inmates. There are providing some programmer to relate in job operating and maintaining for inmate to participate in such as federal prison industries. Within the overcrowding, it is difficult to arrange for inmates to working in the federal prison industries factory. At the end, the inmates release the jail and they are difficult to find the job and committing crime (like a cycle) (R42937) The GAO reported that there are some problem of overcrowding to be highlight and how this problem to might contribute to inmate misconduct and caused in this facilities. In the report, it showed that the growing of population in prison, the inmates should convert common areas (share to common area) such as television room, temporary house space and they inmates with higher propensity for violence spending more times with other inmates and due to the overcrowding in prison, the inmates may experience crowded bathroom facilities, reduce the shower times and waste of time for services, shorten in meal times and limited recreational activities. On the other hand, the increasing number of inmates in bop facilities will decrease the availability of the programmer as there are longer waiting lists for rehabilitative programmer such as education, vocation training, and substance drug treatment. In fact, the reduction in rehabilitative programmer can manage the prison population. In the BOP, if the inmates complete successfully substance drug treatment, they have up to one year taken off their sentence. However, the longer waiting lists for the substance drug treatment programmer, the limited ability of BOP to allow the inmates earning the maximum reduction in inmate’s sentencing. (R42937) Human rights (linked with the mental Health and crowding conditioning) The public and commercial services union à ¯Ã†â€™Ã‚   increase the deaths in custody and to basic standard of human dignity ( UNION PROTEST AGAIN PRSION OVERCROWDING) Prison safety The increasing of population in the prison may lead to overcrowding and cause of the prison safety and the relationship between the staff and inmates. One of importance of goal in the prison system is that it should protect the safety of public, inmates and staff in the prison. However the poor environment conditions and adjustment in the prison will link with the mental health such as suicide and self harm for the inmates and the misconduct behavior. all of the behavior will affect the safety of inmates and staff. (Criminal justice behavior) the early identification of inmates in the overcrowding conditions is the risk for the violence behavior and the health (Criminal justice behavior) Staff: For the staff, it can increase the staff pressure and affect their ability to full access theprisoner’s need and provide the quality care and treatment.( UNION PROTEST AGAIN PRSION OVERCROWDING) Arg: Although the private prisons operate (it can reduce the cost of overcrowding in public prison), there is the questionable of privatization deliver lower costs and whether services provided by private prison comparable to services provided by public prison. Whateverthe public prison or private prison operate, the age of prisoner, the economic scale and the prisoner’s security level are the most important factor of daily per diem cost to determine (R42937) Others: Model Early identification of prison -> security level (Criminal justice and behavior) (Lack of the now) In the mid -1980s, the inmate population under the Bureau of Prison has increase from25000 to over 219000 inmates in the 2013. The growth of inmate’s population in the prison system is contributed to policy change in the previous decades such as the mandatory minimum sentences. In the mandatory minimum sentencing, there are many people convicted of states crimes to sentence in the prison for the long-term imprisonment. At that time, theprison populations climbed almost continuously and hold more inmates to the federal prison system in the United States. From the World Prison Population, it showed that there are 74 percent in American has risen over the six years. (Prison health).However, the prison system capacity cannot afford the large inmate’s population and lead to overcrowding. Overcrowding refers the number of inmates actually holding in the federal prison system is higher than the prison system’s capacity and accommodation prison; overcrowding is not only just measure in the primary living environment (external density) such as the floor space prisoner, prisoner, per living unit and institutional population relative to state capacity, but also it can also measure the subjective experience of density-related discomfort of inmates in the prison.When people talk about the pressure problem in the prison system, it should be focus on how the problem can affect the prison system first. In the prison system, the importance goals are that it should guarantee the public safety, prison inmates and staff; rehabilitation for prisoner to come back the society after they released; punishment for the criminal to reduce the future crimes. In fact, there are many importance problems in the prison system, but overcrowding has bought the serious problem to prison system such as health-related problems for staff and inmates, reconviction rates, costing in the prison system.etc; therefore, the most pressing problem in prison system is the overcrowding. ARG According to  BOP officials, without space for disciplinary segregation, they are limited  in how they can address inmate misconduct. Officials further stated that  when a facility has no Special Housing Unit space available, the regional  office may move the inmate to a Special Housing Unit in another facility of  a different security level—a practice referred to as trans-segregation. Alternatively, headquarters officials said that disciplinary hearing officers  may dispense shorter time in segregation or use other sanctions or a  combination of nonsegregation sanctions. As a result, the officials said  that the imposed sanctions may not be as much of a deterrent with the  inmates, which affects the security and safety of inmates and staff. COUET BOP officials did not discount an incident happening at a  low security facility because of the high gang presence in these facilities. They said that although the criminal histories of low security inmates  suggest that they are not a â€Å"high risk† for violence, these inmates may still  be a high risk for problems because of frustrations resulting from crowded  conditions. Second, BOP officials were also concerned that the federal 25 percent double bunking and 75 percent single bunking of cells  within high security facilities, 50 percent double bunking and 50 percent single bunking of cells  within medium security facilities, and 100 percent From fiscal years 2006 through 2011, the percentage crowding in male  medium security facilities increased from 37 percent to 51 percent and  from 53 percent to 55 percent in high security level facilities  BOP’s high security population was about 21,000 in December 2011—or  about 7,000 more than its rated capacity—resulting in 97 percent double  bunking and a 55 percentage crowding. According to BOP, BOP’s ability to increase rated capacity is directly  affected by funding appropriated for new prison construction and to  support contracts with private prison providers for additional inmate bed  space. In fiscal year 2005, the Office of Management and Budget (OMB)  placed a moratorium on all new BOP prison construction. To address  BOP’s bed space needs, OMB focused on contracting with private  Page 16 GAO-12-743 Federal Prison Crowding  prisons. P38 BOP’s 2020 long-range capacity plan assumes continued growth in the  federal prison population from fiscal years 2011 through 2020, with about  15 percent growth in the number of inmates BOP will house.38 To address  some of this growth, BOP expects to activate five newly constructed  prisons by 2014, adding about 6,720 beds.39 In addition, BOP is  budgeting for additional contracted bed space—1,000 beds in 2013 and  1,500 the next year, but the addition of these contracted beds is subject  to future appropriations. Despite its plans to add capacity through 2014,  given the expected inmate population growth, BOP projects crowding will  increase from the current rate of 39 percent to 44 percent by 2015.  Figure 3 P53

Virginia Woolfs To The Lighthouse - Portrait of a Real Woman :: To The Lighthouse Essays

To The Lighthouse - Portrait of a Real Woman Until To The Lighthouse, I had never read anything that so perfectly described women: wives, mothers, daughters and artists. I felt like shouting "Eureka!" on every page. These were my thoughts, beautifully written. Virginia Woolf writes of the essential loneliness and aloneness of human beings. In the first passage I am examining Mrs. Ramsay is the heart of the group gathered around the dinner table. It is because of her that they are assembled. She is the wife, the mother. "And the whole of the effort of merging and flowing and creating rested on her." But she feels disconnected, "outside that eddy" that held the others, alone. She views her husband almost as an inanimate object. "She could not understand how she had ever felt any emotion or affection for him." The room has become shabby. Beauty has dissolved. The gathering for which she is responsible is merely a group of strangers sitting at the same table. "Nothing seemed to have merged. They all sat separate." Mrs. Ramsay understands that she must bring these people together. "Again she felt, as a fact without hostility, the sterility of men, for if she did not do it nobody would do it." So she drifts into the eddy to do her duty -- albeit reluctantly. "...she began all this business, as a sailor not without weariness sees the wind fill his sail and yet hardly wants to be off again and thinks how, had the ship sunk he would have whirled round and round and found rest on the floor of the sea." This passage is so true! In a traditional family (my family) there is a man (husband and father), a woman (wife and mother), and children. The woman is claimed by all. She is held responsible, both in the eyes of her family and in her own eyes, for the happiness and well-being of all. She is the glue, the anchor, the spark, the damper. She is lonely but never alone. The idea of drifting to the bottom of the sea can seem inviting Ð to be free and alone! This short passage aptly illustrates a real woman's very complicated feelings about the demands of family and society upon her. I think it is no less valid now then it was in the 1920s when the book was written.

Public education reform: Community or national funding of education Essay

Soares presents an article that draws on a political economy model of public funding as a tool to assess the education implications of moving from a community-to nation-wide funding policy. His intention is to widen the source for the finance of education that will redistribute funds both at the intra-generational and inter-generational levels. Previous literature has focused on the intra-generational redistribution effects of going from a local to state funded approach. Instead, Soares suggests a model of education reform that would see funding include the social security system and would allow factor prices to vary. Such flexibility would benefit welfare effects to students by enlarging the funding net in the form of a nation-wide system. Significant welfare gains that would occur with a nation-wide system are supported by other research (Soares, 2006; Wasser & Picken, 1996). Soares also reflects on his previous writings on the important roles of altruism and self-interest in influencing the political decisions of public education policy. He points to the inter-relationship of three main factors in determining how policy will be formed; altruism; the impact of public funding of education of the social security system; and the impact of these factors on factor prices. In conclusion, Soares article depicts a critical issue in education reform that has been ongoing for many years: How to source optimal continual funding for education that does not detract from the welfare of the wider population? He provides a viable alternative to funding. At present most States provide fewer dollars to minority and low-income students. A nation-wide funding policy would ensure that the funding gaps which exist across schools in the USA would be narrowed, providing equality of access to learning opportunities and resources. This would align with the recent No Child Left Behind Act of 2001.

Administrative Law Coursework The WritePass Journal

Administrative Law Coursework Introduction-Source of Power Administrative Law Coursework Introduction-Source of Power[Question 1:]ConclusionOther Possible Claim[Question 2:]Conclusion Second ClaimConclusion Third ClaimAvailable Remedy [Question 3:]Claim OneClaim Two[Question 4:]BibliographyRelated Introduction-Source of Power In order to seek for the legality of an action taken by a public body, first, we may need to identify the source of its power. The source of the power provides the standard for the reviewing exercise. Generally the source of the delegated discretion for Public Law will be an enable Act, yet there are cases where it may be an Order in Council issued under the Prerogative. The fact sheet shows that the (fictitious) Traffic Control Act 2010 was imposed by the Councils, thus we may conclude that the source of the power in this case is by Public Law. [Question 1:] Amelia, who has been ‘prosecuted for breach of a 15 mph speed limit’, is likely to seek for judicial review on the ground that the decision taken by the Council is unreasonable. She may argue that she was driving through the ‘thinly populated docks area’ where the 2010 Act need not to be imposed. Hence she may also try to seek for quashing order against the prosecution during the application of judicial review. It has been some time that the basic test for reasonableness in English Administrative Law was driven from the Court of Appeal’s decision in Associated Provincial Picture House Ltd v Wednesbury Corporation (the Wednesbury case). Lord Green MR stated the authority’s decision might be open to attack because the imposed principle in the case was: â€Å"Not directing itself properly in law; not taking into account relevant considerations, or conversely taking into account irrelevant considerations; acting unreasonably; acting in bad faith; or acting in disregard of public policy†. Nonetheless his Lordship went on saying that it was important to bear in mind that Parliament had entrusted the local authority with the discretion to impose the law because of the belief of the area’s needs.Thus his Lordship suggested that the courts should not rashly intervened and quashed a condition imposed by such a body, unless such condition really did involve the element of unreasonableness. However, compelling evidence will be required to prove a case in such matter. Beside the Wednesbury Test, terms such as ‘Illegality’, ‘Irrationality’ and ‘Procedural Impropriety’ are identified by Lord Diplock from Council of Civil Service Unions v Minister for the Civil Service(the GCHQ case). As mentioned above, proving unreasonableness or irrationality will require heavy evidence provided by the applicant for juridical review. It should be that unless the unreasonableness in the case is so manifested which leave the court no choice but to step in without hesitation. Additionally the courts will consider not only the merits of the decision but also the ‘necessity and appropriateness’ of their judicial intervention. As Woolf LJ had explained: it was not for the courts to trespass the function of the local authorities simply because they disagreed with the decision. It is important for the courts to consider about the purpose behind the relevant legislation. Hence, the Seachester Council may defense itself on the ground that although the docks area may truly be ‘thinly populated’ but to certain extent, potential harms may still occur because of high speed driving. In other words, instead of considering only about the population, the main purpose of the 2010 Act is to have safety concern about the traffic issues in such area. On the other hand, the Council may have drawn a statistic map; and found the necessity to impose a traffic control measures in order to prevent further tragic or dangers. Under such accounts, it may be inappropriate to say that the Council has abused its delegated power and caused illegality. Conclusion With the Seachester Council defense, we may come to the conclusion that the court is unlikely to accept the applicant of judicial review made by Amelia. Other Possible Claim If Amelia’s claim involved issue such as the breach of her fundamental rights, there may be a possibility that other test beside the Wednesbury Test may be engaged. Nonetheless this is not the case here, thus there is no other alternative claim which Amelia can make. [Question 2:] Bertram may seek judicial review against Ruffborough Council’s decision for not imposing the traffic control measure on where he lives; an area which has ‘very high accident rate’ and required the Council to strictly imposed the law; otherwise irrationality/ unreasonableness will establish. As we had discussed above for the test of unreasonable/ irrationaland its principles, we had also come across the facts that the courts are reluctant to rely to interfere the decision made by the council. This is because otherwise they will substitute the function and power which the Parliament has entrusted to the public bodies. An example of this test can be seen in the case of Nottinghamshire CC v Sec of State for the Environment. Furthermore Bertram will also be asked to provide strong evidence to support his ground under the Wednesbury Test. In order to have a more effective claim, Bertram may try to have his argument based on the fact that his Article 8 of Human Rights Act (HRA) 1998 had been breached by the Council’s decision. Ever since the incorporation of the European Convention on Human Rights in the Human Rights Act 1998, the domestic courts began to have a strict application of the test of unreasonableness in cases which involved the issues of the citizen’s fundamental rights. In R v Secretary of State for the Home Department, ex parte Bugdaycay, Lord Bridge said: â€Å"†¦the court must†¦be entitled to subject an administrative decision to†¦more rigorous examination†¦according to the gravity of the issue which the decision determines. The most fundamental of all human rights is the individual’s right to life and when an administrative decision under challenge is said to be one which may put the applicant’s life at risk, the basis of the decision must surely call for anxious scrutiny.† Similar statement was expressed by Sir Thomas Bingham MR in R v Ministry of Defense, ex parte Smith. Bertram may now allege that without the appropriate traffic control, his family or just he will be under no protection against the high traffic accidents; the safety concern of where he lives is doubtful. By law, the public authority should exercise its rights to ensure that interests of ‘national security, public safety are well-maintained and made efficient prevention against crime, disorder for the protection of health, morals, or for the protection of the rights and freedoms of others’. Now, since Bertram has relied his case on the HRA1998, this means that the doctrine of proportionality will be considered by the domestic courts while determining his application of judicial review. The doctrine of proportionality stated that the action will be unlawful if it is inappropriate in its effect, or relative to what is required. R v Barnsley Metropolitan Borough Council, ex parte Hook suggested that English Law had recognized this doctrine for sometime as the offshoot of the unreasonableness test. Smith and Grady v United Kingdom and Lustig-Prean and Beckett v United Kingdom had became the basis for review when Convention rights were involved. The court found that prohibiting homosexuals to serve in the army forces had constituted a violation of HRA 1998 in the judicial review and had provided no effective domestic remedy in respect of the Convention rights. This was because the threshold set by the domestic courts for proof of irrationality was too high that it did not allow the applicants to gain their remedy. Furthermore Lord Bingham in A v Secretary of State for the Home Department 2004 said that under Proportionality Test, the courts should consider not just the behavior complained but also, they should also look for another way of proceeding which will not limit the Convention rights. If the answer is a ‘Yes’ then the behavior may not be proportionate. Nonetheless such wide assessment will involve judges to consider the merits and not just the process which may subsequently form more controversial issues. Until this stage, we may say that the proportionality doctrine has a lower threshold and it allow a court to balance conflict of interests. Thus if Ruffborough Council wishes to restrict Bertram’s human right then the restriction must be proportionate or no greater than it is necessary to be. However, House of Lords in R v Home Secretary, ex parte Brind refused to accept the proportionality doctrine as a separate and stand-alone head of judicial review. Lord Slynn in R (Alconbury Developments Ltd and Others) v Secretary of Stet for the Environmentt expressed his opinion: â€Å"Trying to keep the Wednesbury principle and proportionality in separate compartments seems to me to be unnecessary and confusing. In Alconbury case and R (Daly) v Secretary of State for the Home Department, it has indicated that the senior judges are like to simplify the law by using just the proportionality doctrine in all judicial review cases. Nonetheless for other cases in House of Lords, this approach is refused. The Court of Appeal in R (Association of British Civilian Internees Far Eastern Region) v The Secretary of State for Defense pointed out that proportionality is not yet ready to be adopted by the domestic law in cases which does not concern about European Union or the European Convention of Human Rights. Thus the traditional Wednesbury test remained as a correct test. Conclusion Despite the fact that the law is still developing and causing some controversies yet if we assume that the judge is willing to accept the proportionality doctrine in Bertram case, we may say that he has a chance of winning his case. This is because based on the arguments which he had mentioned and after considering the true nature or purpose of the 2010 Act, the decision made by Ruffborough Council may be deemed to be unreasonable or disproportion. On the other hand, such decision does violate his Article 8 of HRA 1998. Second Claim The 2010 Act clearly stated that the traffic control measure should be imposed on high accidental area. Hence when the Council failed to exercise its power Bertram may argue that it has failed to comply with the express statutory requirements. By logic, if such failure happened, it should be that the Council’s decision will be deemed as ultra vires. For Bertram’s case, the court will first consider both the general principles of statutory interpretation and the intention of the Parliament in enacting such law. In short, any public authority which has its statutory power exercised in the way which formed contradiction with the Parliament’s intention is going to have its action considered to be ultra vires (R v Pierson). There is a reasonable and logical ground for Bertram or the court to believe that the nature and purpose for the Parliament to introduce the 2010 Act is to prevent further harm, tragic and increase of the accident rate in traffic. Therefore when the Council failed to comply with such expressed statute term, it is obvious that its act contained illegality. On the other hand, by taking the account of European Convention on Human Rights when exercising power or making discretion, the public authorities are required to consider about the demands of the Convention Rights. The decision made by the public authorities will not be unlawful only if they are not able to avoid the incompatibility of one or more provisions of primary legislation. Otherwise their actions or decisions would be illegal for not upholding the Convention Rights. Conclusion As we have mentioned above, Bertram may argue that the Council’s decision has infringed his Article 8 HRA 1998. Thus if the court find the Council has no compelling defense or its decision has formed contradiction with the Parliament intention, it likely that such decision will be deemed to be defective. Third Claim Bertram was expected to be consulted with the Council yet he was not. Again we may say that the Council has failed to comply with the express statutory procedural requirements. As stated above, such failure may constitute ultra vires. Nonetheless we may need to identify if such requirement is mandatory or directory. Based on the fact sheet, we may say that there is a statutory requirement that the Council should have consulted with Bertram before making its decision and such requirement is considered to be invariably mandatory by the courts (Agricultural, Horticultural and Forestry Industry Training Board v Aylesbury Mushrooms Ltd). The court in the case held that the scheme was invalid, as against the mushroom growers since they were not consulted. However the court in the case did not invalidate the whole scheme. Thus, if we apply the test of the Agricultural, Horticultural and Forestry Industry Training Board case, we may say that Bertram has a chance in succeeding his claim. Nonetheless the Council may argue that there is no right to be heard since there will be no difference to the outcome.   Support of this augment can be found in Glynn v Keele University and Another. In the case, the court refused to invalidate disciplinary action taken in respect of the student concerned, despite the fact that he had been denied a hearing. The court made such decision on the ground that no matter what he would say would be able to change the outcome. Ruffborough Council may argue that:‘†¦such bodies as significantly represent local communities†¦Ã¢â‚¬â„¢, as the 2010 Act has stated may have referred to the communities which concern more about the local residents’ live- hood issues/living qualities. In other words, Bertram’s association will less likely to be considered as ‘significantly represent local communities†¦Ã¢â‚¬â„¢. Nevertheless Bertram may claim that there was legitimate expectation in him towards the Council based on the previous promise or course of dealing. Like the applicant in t he case of AG of Hong Kong v Ng Yuen Shiu[47], Bertram may argue that he had a legitimate or reasonable expectation to the consultation since the decision made by the Council will eventually affect his interest. On the other hand, similarly with the applicant in Council of Civil Service Unions v Minister for the Civil Service, if there had been regular practice of consultation between the Council and Bertram on matters relating to the impose of legislation in Ruffborough, Bertram will then have a legitimate expectation of being consulted. Hence, when the Council failed to consult with Bertram, we may say that there is a breach of natural justice/legitimate expectation. Such breach may lead to the consequence that the decision made by the Council will be void since it is based on ultra vires. However to determine if a decision is truly ‘void’, the decision will be left with the courts. Available Remedy For his overall claims, if Bertram’s application against the Council is judicially reviewable, he may seek for mandatory order as remedy. The court will order the Council to fulfill its duties since it addresses wrongful failure to act. In short, the Council will need to draw a designated control area at where Bertram live and where it is suppose to be at Ruffborough. Failure to comply with such order will form as contempt of court and it will be punishable.   However if the statutory duties are drafted in a wide and vague terms, the court will not grant the remedy unless the compliance with the order can be supervised. Or, the order will not be granted only if the Parliament has supplied a more suitable alternative remedy. [Question 3:] If Clark’s application of judicial review is determined under the traditional Wednesbury test as we had discussed earlier, it is likely that he will lose his case. On the other hand, even though Clark may claim that his Article 8 HRA 1998 has been violated and thus his case should be justified under the proportionality doctrine, yet the doctrine is still controversial and is unlikely to be certainly applied by the English courts. Thereby we will need to seek for an alternation in order to make his claim judicially reviewable. Claim One The enforcement of HRA 1998 has made it becomes unlawful for any public authority to act in anyway which is incompatible with the Convention Rights. Therefore as a public authority is exercising its discretion, it will need to determine if its discretion has form contradiction with the Convention Rights protected by the Act. Such impact incurred by the Convention rights on the public authorities and the scope of judicial review remains in question but we may still have our expectation based on R v Secretary of State for the Home Department, ex parte Quaquah. Hence Clark may claim that his fundamental right has now been affected by the designated area created by the Council. Although it may be true that Clark’s interest has been affected by such legislation however if the court does not find the evidence provided by him has the sufficient ground which can compel with his argument, it is likely that Clarke will lose his case. The actions taken by the public authority can be declared as ultra vires when it has acted on the basis of irrelevant considerations In short, if the public authority has acted without necessary evidence to justify its decision or it is trying to achieve some hidden aim or goal by using a power not intended for the purpose, we may say that it has acted beyond relevant considerations. The basic theory regarded to this issue is laid down by Lord Esher MR in R v St Pancras Vestry. It is true that the public authorities will face difficult task of balancing one set of considerations against another and usually the courts are unlikely to substitute the public authorities’ view with its own opinion. To determine if the administrative action has been legally taken based on the statutory powers, the courts will first consider about the statutory interpretation and the intentions that the Parliament is trying to achieve when certain legislation is being carried out. Therefore if the statutory power has been carried out in the sense which has diverged with any general assumptions regarding to Parliament’s legislative intent, the action is likely to be deemed as ultra vires (R v Pierson). In Clark’s case, it is likely that the court will find the legislation imposed by the Council is to protect the public from as many traffic tragedies as possible. Between Individual’s self-interest and public policy, we may come to an assumption that the court is likely to guard the public policy rather than blindly favour the interest of an individual. Claim Two Clarke claims that the Council allowed the decisions to be taken by Antifume whom received commission to write a report. He may want to challenge the validity of that report. According to S 101 of the Local Government Act 1972, Parliament has stated that local authorities have very large scale of work ranges and duties. Therefore it is impossible for them not to continue their works with delegation of their functions to committees, officers or even other local authorities. However note that the final decision will still be made by the local authorities, and they reserved the rights to exercise their powers. Hence the courts may have an indulgent attitude to the delegation of functions by a local authority. In Provident Mutual Life Assurance Association v Derby City Council, the appellant challenged the validity of the notice issued by the respondent authority on the ground that the notice was made by the authority’s Assistant but not the Treasurer. The applicant’s argument was rejected. Therefore with the decision of Provident Mutual Life Assurance Association case as a guideline, we may come to the conclusion that Clark is likely to lose his claim here. Unless there is significant fault made in the procedural requirement as how it was indicated in R v St Edmundsbury Borough Council, ex parte Walton, otherwise the court will not find the Council’s delegation of power illegal. Conclusions Hence, with all the above arguments and discussions, it is unlikely that Clark will win his case. Therefore there will be no remedy available for him. [Question 4:] Dee may seek judicial review against the Council’s decision of to designate no ‘control areas’ just because the Council wants to save money and ‘as a matter of policy’. Nonetheless the Council may argue about its finance constraints. Generally, a public body must be acting in good faith and to exercise discretion properly. If these two conditions are satisfied, the courts will not intervene. Alternatively, the court will intervene only if the decision is illogical or suggest willful indifference (In R v North Derbyshire Health Authority, ex parte Fisher). However there are cases where statutory context should be concerned. When the statute is drawn in wider, more generalized, terms the court may be able to grant an authority some flexibility.As it was stated by Lord Woolf MR in ex parte Help the Aged cased that that once a need is mentioned, yet lack of resources cannot be relied upon as a reason for not providing the necessary accident. Nevertheless the House of Lords expressed that there were still other ways of providing a reasonable decision. However Lord Browne-Wilkinson said once the reasonableness became narrowed to how a local authority had decided to allocate scare financial resources; the local authority’s decision would be hard to review. â€Å"The court cannot second-guess the local authority in the way in which it spends its limited resources.† Hence, unless the 2010 Act does further stated that the law must be imposed regardless of the financial state of the local authorities, otherwise there is a possibility that the Council will have the flexibility not to impose the law. Or if the circumstances of the case are similar with R v Gloucestershire, the court will likely to alter the Council’s decision. If we presume that the court has decided to make an intervention, mandatory order may be granted as the remedy of Dee’s claim. On the other hand, when any controversial budget decision involves one’s fundamental human rights, the applicant could now claim that the decision is unlawful.   Hence Dee may claim that the decision will breach her Article 8 HRA 1998. With the similar theory stated in Question two, if the court found that the decision is inappropriate and does cause violation of Dee’s fundamental right, it is likely that her applicable will be judicially reviewable and mandatory order will be granted as the remedy. Bibliography [Textbooks] Michael T Molan. Administrative Law Third Edition. Old Bailey Press, 2005. A W Bradley., and K D Ewing. Constitutional and Administrative Law Fourteen Edition. Pearson Education Limited 2007. David Pollard., Neil Parpworth., and David Hughes. Constitutional and Administrative Law Text with Materials Fourth Edition. Oxford University Press 2007. Peter Leyland., and Gordon Anthony. Textbook on Administrative Law. Oxford University Press, 2005. William Wade., C.F. Forsyth. Administrative Law Tenth Edition. Oxford University Press, 2009. David Hoffman., and John Rowe Q.C. Human Rights Act in UK: An Introduction to the Human Rights Act 1998 Third Edition. Pearson Education Limited 2010. [Websites] Human Rights Act 1998: Table of Contents. legislation.gov.uk/ukpga/1998/42/contents Judicial Review of Administrative Decisions. http://administrativelaw.uslegal.com/judicial-review-of-administrative-decisions/ Wednesbury Principles of Reasonableness: The Law Revisited. http://legalperspectives.blogspot.com/2010/05/wednesburys-principles-of.html Logic Reasoning Though Law forceofdestiny.co.uk/Literature/Questor/Logic5.html Doctrine of Legitimate Legislation. shvoong.com/law-and-politics/1673788-doctrine-legitimate-expectation/ Fiona L, McKenzie, Barrister. Ground of Review. lawhandbook.org.au/handbook/ch21s02s06.php# What are Fundamental Rights? wisegeek.com/what-are-fundamental-rights.htm