Wednesday, February 22, 2012

Research Paper on Politics and Economics

Research Paper on Politics and Economics

Abstract
The level of involvement is the result of many factors, among which is the countries vulnerability to world and European, in particular, economic and political pressures.  In Germany (federal corporatist country with agreement oriented representation political system) the government is capable to negotiate the reform.  In France and Britain (unitary countries with majoritarian representation political systems) the reforms are imposed. 

Introduction
These four counties are all democratic; however, they have a lot of differences as well as similarities in the political systems.
   

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France is a democratic republic with a system based on the written constitution approved by referendum in 1958.  The president is elected every five years by direct suffrage.  The president rules over cabinet, commands the armed forces and signs the international treaties. Also he directs foreign policy.  President appoints Prime Minister and is empowered to dissolve the National Assembly.  French political system is a hybrid of presidential and parliamentary elements. 

Question 1:
England, France, Germany and Russia have democratic political systems.  Compare and contrast the differences among them. Evaluate the system you think works best. Why?

These four counties are all democratic; however, they have a lot of differences as well as similarities in the political systems.
   
France is a democratic republic with a system based on the written constitution approved by referendum in 1958.  The president is elected every five years by direct suffrage.  The president rules over cabinet, commands the armed forces and signs the international treaties. Also he directs foreign policy.  President appoints Prime Minister and is empowered to dissolve the National Assembly.  French political system is a hybrid of presidential and parliamentary elements. 
   
National Assembly is elected by universal suffrage for five years, and Senators are elected for nine years with renewal every three years.  Currently the President Chirac closely coordinates policy objectives and legislative issues with Prime Minister Jean-Pierre Raffarin.  Prime Minister is in favour of regional empowerment and decentralization as well as free enterprise (elements of capitalistic systems). 
   
Raffarin’s reforms are highly democratic and are favourable for the business climate in France.  The taxation burden is lowered and businesses are allowed to return from 35 business week to 39-hour.  The pension schemes are over burdened however more democratic reforms are being currently developed.  Reforming of health insurance systems and union structures are next objectives to be settled.  The reforming style is consensual.  The French political system is the best example of the democracy in Europe.  The opinion of people it always counted as important, the election of government representatives is done through direct election, not appointing.  French government is truly the government for people and by people.
   
France has more than 12 political parties.  The most important are Communist and Socialist parties.  Parties with similar political views are encouraged to unite into alliances.  Germany’s political system, on the contrary to French was formed to keep the number of political at minimum level to prevent extremist groups from having a big impact on the life of the country. 
   
German parties are required to win a minimum of 5% of national vote and gain seats in a minimum of 3 electoral districts to receive a representation in the Bundestag.  Each voter can cast two (!) votes: one for individual politicians and second for the party.  Germany is a constitutional federal republic.  The basic law – Constitution – was laid in 1949.  The head of the government is Chancellor who is elected by the parliament. 
   
The Federal Assembly is elected every four years.  The Federal Council is the representation of 16 states.  The effective government is very hard in Germany because these two Assemblies block the each others decisions all the time.  The current President is Horst K√∂hler.  He serves as a head of state and has the same functions as French president. 
   
France and Germany are leading countries in the European Union. Germany is at the forefront of all European countries seeking to unify them to create stronger political, defense and security apparatus. In 2003 Germany together with France were upholders of the coalition of nations opposing the military invasion of Iraq by United States.  United Kingdom also supported them.
   
England, as a part of United Kingdom of Great Britain and Northern Ireland, has completely different political system.  All laws are made by parliament which consists of two houses: House of Commons and House of Lords (has almost no power).  Members of the Parliament are elected every five years by people.  Prime Minister is the leader of the majority party in the Parliament.  The Cabinet, real government is made up of the Prime Minister and the most important ministers. There are three major parties: Labor party (left), Conservative Party (right) and Social Democratic Liberal Alliance (middle).
   
Currently Tony Blair is the Prime Minister.  England has a symbolic head of the country: the Queen or King, but they have no political authority.  Thus England is a parliamentary democracy with a constitutional monarch, currently Queen Elizabeth II.  There are some complaints rising about the ability of non-English members to influence purely English affairs.  The current labor party favored the creation of regional administration but the referendum on this issue held on November 4, 2004 rejected the proposal.  It is believed that the establishment of regional administration will undermine the concept of English nationhood.
   
Russian Federation also has a democratic political system; however, it is still in the process of development.  The constitution of 1993 created a dual executive branch consisting of president and prime minister.  Unlike England, the president has more power than Prime Minister. Russia has strong presidency which is sometimes compared to Charles de Gaulle in the French Fifth Republic.  The president is elected for five years term and determines the basic direction of Russian domestic and foreign policy and also represents the country in the foreign affairs.
   
The parliament consists of two chambers: The council of eh Federation (formed without election in 1996 for unlimited period) and State Duma (elected for four years).  The federal Parliament consists of numerous parties: Communist party, Unity party, Liberal Democratic Party and many others.  The law requires that at least 50% of the eligible voters to participate in election process in order for a presidential election to be valid.  The current president Vladimir Putin, serving for the second term, has many plans to make Russia more democratic not only in political structure but also in economic sphere (to reduce corruption and increase liberalization).

Question 2:
Many observers praise capitalism as an economic system. What features does this system have? How capitalist are the countries of England, Germany, France and Russia? Which country do you think runs most efficiently? Why?

Capitalism is an economic system based on the private ownership of the production facilities. The private profit can be acquired with investment of capital and employment of workforce. Capitalism is based on the concept of unrestricted enterprise.  It argues that the government involvement into economy should be minimal.  The free market which depends only on changes in demand and supply will increase the prosperity of the people. 
   
The fundamental principle of capitalism is freedom of individual enterprise.  However, the government actions sometimes are required to check the abuses.  In addition, capitalism does not presume any specific form of social or political system.  Private production plays the key role in the economy of many countries. For this reason, the idea of letting the market entirely determine the economy is rejected by many. 
   
In Europe there are three capitalistic systems left: market capitalism of England, managed capitalism of Germany and state capitalism of France.  Russian Federation also has its own unique capitalistic system.  French capitalism belongs neither to market capitalism nor to managed capitalism.  It was obtained through market-oriented reforms and is a hybrid of two forms. 
   
In the mid of 1970s France began reforms just after England, but Germany started reforming even later.  Russia is the last country with capitalistic economy to start reforming.  In France the role of government transferred from leadership to an enhancing role.  The government is still involves into economy (indirectly to improve the working environment) than German or British. 
   
The level of involvement is the result of many factors, among which is the countries vulnerability to world and European, in particular, economic and political pressures.  In Germany (federal corporatist country with agreement oriented representation political system) the government is capable to negotiate the reform.  In France and Britain (unitary countries with majoritarian representation political systems) the reforms are imposed. 
   
In England the model of market capitalism developed early after the war.  England is characterised with high economic vulnerability in combination with huge political capacity to set reforms.  The key was to generate enough political evidence of the appropriateness of the reforms, not just their necessity.  The modern market of England is the result of early reforms by Thatcher’s government.  Starting with the liberalization of the financial market in 1986, she continued with privatization and huge sell off of monopolistic public enterprises.  Business was deregulated:  voluntary self-governing arrangements were replaced by independent agencies. 
   
The labor market of England is radically decentralized through deregulatory policies which reduce the unions’ powers for strike and organization but increase the workers ability to hire and fire at will.  The Britain was always very liberal and the capitalistic economy reforms made it even more liberal.  The government acts as an agency for market protection and provides basic legislation to help to locate decision – making powers in enterprises and to limit the authority of organized unions.
   
In Germany the model of managed capitalism started to appear in 1990s and was a result of unification and increasing pressure from international markets.  Reforms began even later when the government decided that enabling the state could bring greater economic competitiveness.  In Germany the regulatory institutions are vested into private companies and employee associations.  Unlike England, the reform process is very slow because federal government has to negotiate reforming plans with labor, business and regional governmental institutions. 
  
The key achievements of capitalism in Germany are liberalization of financial markets (in 1995), privatisation of the small amount of public enterprises in mid of 1990s, and the deregulation of public and infrastructural services (telecom and electricity).  However, some of the problems are not solved so far.  The government lacks the political capacity to negotiate the reforms of labor markets and pension systems.  The union system is very strong in Germany and stymies the government’s ability to reframe the terms of social market economy. 
   
In France reforms started as early as in England.  The way for reforming was different from other countries.  The Mitterrand government has chosen a massive program of nationalization and restructuring.  Early in 1980s the state was retreated from leadership of business and the control of labor relations.  The government continues to intervene strategically to protect the business and labour from the worst effects of the market.
   
In Russia the reforms started in several phases: early in 1920s, 1980s and in 1990s.  The directions taken were different; however, the reliance on support from state was vital for many companies.  Today there are still three monopolistic structures in the country:  Gas Production (governmental share is 51%), Savings bank (contains 60% of all deposits of the country of more than 90% of the voters) and United Systems.  Putin, the current president of the Russian Federation who is serving for the second term, has plans to change the situation.  The Gas production companies (the total country revenue is highly dependant on oil and gas industry) will allow more foreign investment (currently only about 5%).
   
The English capitalism, market capitalism, has proved to be the most effective.  The government does not intervene a lot into the economy and market of the country giving more freedom to entrepreneurs and employees to change their works.  The high economic indexes are the indicators that economic system does work. Germany is still struggling to make unions less powerful, while Russian is still on the stage of making first steps towards capitalistic development.  The French is more capitalistic then Germany and Russia but less capitalistic then England.  English economical and political superiority makes it a key player on the European market.

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