Political and Economic System Essay Example for Free

Political and Economic System Essay Spain’s political system is parliamentary monarchy. Spain has many different political and economic issues that can impact the society. Most of these issues can be deal by the government. Sometimes other countries can be compare and contract its political and economic issues to other countries. Political System Spain’s government is parliamentary monarchy. The most important task of the constitution was to devolve power to the regions, which were given their own governments, regional assemblies and supreme legal authorities. The central government retains exclusive responsibility for foreign affairs, external trade, defense, justice, law (criminal, commercial and labour), merchant shipping and civil aviation. Spain has been a member of the United Nations (UN) since 1955, the North Atlantic Treaty Organization (NATO) since 1982 and the European Union (EU) since 1986, and is also a permanent observer member of the Organization of American States (OAS). Spain has three branches of government which includes the executive branch, the legislative branch and the judicial branch. The Senate has 259 members, directly elected by a first-past-the-post system. Each province provides four members plus additional members in the Balearic and Canary islands, where extra members represent the various islands, making a total of 208 members. The 17 autonomous regions also elect one senator each and an additional member for every million inhabitants, totaling a further 51 members. The Senate has the power to amend or veto legislation initiated by Congress. Under Spanish law, the official result of a general election is made public five days after the vote, in order to allow sufficient time for recounts and disputed results. After the members have been sworn in, the King of Spain meets with the party leaders and asks one of them to form a government, which must then be ratified by parliament. The leader of the party of government becomes the president of Spain and has his official residence in the Moncloa Palace in Madrid. The role of citizens in Spain is that they have to be born of a Spanish mother or father. A person born in Spain of foreign parents if neither of them has Spanish nationality or if neither of the parents legislations confer a nationality to their children. Spain has many political issues. One political issue is during the last few years has been corruption among public officials, including illegal financing of political parties, tax avoidance, fraud, bribery, trying to keep a place or someone in the residential institution, nepotism, misappropriation of public funds, illegal patronage, influence-peddling and kickbacks. Spain has been described (in the Spanish press) as the most corrupt society among the original 15 members of the EU and corruption permeates political and public life at every level. This problem is affecting the Marbella council on a massive scale, involving tens of millions of euros pocketed by council officials. Economic System Spain’s economy is a well-based way to equally spread money to all of the people. Some of Spain’s natural resources include coal, lignite, iron ore, uranium, mercury, pyrites, fluorspar, gypsum, zinc, lead, tungsten, copper, kaolin; hydroelectric power. Spain’s currency is the European Union euro. Spain’s imports include machinery and equipment, fuels, chemicals, semi-finished goods, foodstuffs, consumer goods, measuring and medical control instruments. In 2011, the amount of money that Spain received for imports was $364. 9 billion. Some of Spain’s exports include machinery, motor vehicles; foodstuffs, pharmaceuticals, medicines, other consumer goods. In 2011, the amount of money that Spain received for exports was $309. 6 billion. The gross domestic per capita is thirty three thousand six hundred euros a year. In labor force 2. 4 percent goes to agriculture, 24 percent to industry, and 71. 1 percent to services. Spain came out in the number one position because it is a sunny country, because its citizens enjoy shorter working hours and more days holiday, because energy and lifestyle costs are lower, because the government invests into education and healthcare, because the average age at which people die is higher than in most of Europe and because overall, living in Spain ensures you have a better quality of life. Spain has many economic issues. One economic issue is that the Spanish banks high exposure to the collapsed domestic construction and real estate market also poses a continued risk for the sector. The government oversaw a restructuring of the savings bank sector in 2010, and provided some $15 billion in capital to various institutions. Investors remain concerned that Madrid may need to bail out more troubled banks. The Bank of Spain, however, is seeking to boost confidence in the financial sector by pressuring banks to come clean about their losses and consolidate into stronger groups. Puerto Rico doesn’t have political and economic issues similar to Spain. One reason Puerto Rico political issue is not similar to Spain because Puerto Ricans do not have representation in the U. S. Senate and no voting representation in Congress. Instead, the 4 million U. S. Citizens of Puerto Rico only have one â€Å"Resident Commissioner† who cannot even vote on the House floor. Therefore, Puerto Ricans have no say in the making of the laws and statutes that apply to them. Even though the U. S. Supreme Court has absolute jurisdiction over Puerto Rico, Puerto Ricans do not have representation in the U. S. Senate to cast an up or down vote on Supreme Court nominees. In the end, Puerto Rico is governed by a Congress in which they are not allowed to participate in, an Executive whom they did not elect, and a Judiciary whose justices they did not confirm. The 4 million U. S. Citizens of Puerto Rico are not allowed to fully participate in the democratic process of their nation. One reason Puerto Rico economic issue is not similar to Spain because recently in Puerto Rico the economy has suffered budget cuts from U. S. The Puerto Rican economy has depended heavily on the tax incentives given to U. S. mainland companies and on federal transfers. Conclusion There were many different things that I learned about Spain’s Political and Economic Systems. One thing that I found interesting was that Spain has the ninth largest economy in the world. Another thing that I found interesting was that Spain was originally a constitutional monarchy but over time became a parliamentary monarchy.

Linda Mcquaigs Shooting The Hippo: Causes And Results Of Debt :: essays research papers fc

Linda McQuaig's Shooting The Hippo: Causes and Results of Debt Linda McQuaig's most recent book, "Shooting the Hippo" is about the causes and results of the debt. It is a look at both the factual causes and the arguments which are merely presented to us through the various elements of the media. McQuaig delivers an insightful overview of the extensive media coverage which has bombarded us over the past few years. "With the excitement of a mystery writer, McQuaig tells the real story behind the debt." . This book explains the history of the deficit myth, and enables people such as myself who are not experienced in these types of problems to get to the heart of the arguments presented so frequently about our financial situation. I found her book an inspiration which will hopefully help us all to devote ourselves to the enormous challenge which we will face in the future. We are responsible to inform and educate ourselves, our friends, our families and neighbours in the difficult days ahead. To explain McQuaig's title I'll briefly describe the beginning of the "mystery." A baby hippo, born in a zoo, is to be shot because of recent government cutbacks which leave nothing to feed or care for the hippo. This image grabs the attention of the reader and leads to numerous other examples which McQuaig uses to break down the popular myths about the deficit. McQuaig, determined to expose one by one, several of the current myths about the state of the Canadian economy, backs up her arguments with interviews and publications. These include: a chief statistician at Statistics Canada who has been working on the statistics of social spending since the middle '60s; the man at Moody's bond rating service in New York who is in charge of setting the credit rating on our federal debt; and noted economists, among others. The book goes on in its investigation as to why the recession in Canada was the worst of the world's most powerful nations. It is noted that if there is a simple way to explain the reason for most of the recession then it will in turn account for most of the increase in the debt. McQuaig also presents a bit of history of banking, monetary systems, and the struggle of the conflicts between the rich minority and the rest of us. All of this is presented in a very readable and interesting manner. McQuaig asks an intriguing question to all of us. Are we prepared to see our social programs sacrificed in order to reduce the deficit?

Weighted Average Cost of Capital and Midland Energy

Executive Summary: Midland Energy Resources, Inc. is a global energy company with a broad array of products and services. The company operates within three different operations including oil and gas exploration and production (E&P), refining and marketing (R&M), and petrochemicals. Midland has proven to be a very profitable company, with reported operating revenue of $248. 5 billion and operating income of $42. 2 billion. The company has been in business for over 120 years and employed more than 80,000 individuals.Janet Mortensen, the senior vice president of project finance for Midland Energy Resources, has been asked to calculate the weighted average cost of capital (WACC) for the company as a whole, as well as each of its three divisions as part of an annual budgeting process. Midland’s Three Divisions: Exploration & Production Oil exploration and production (E&P) is Midland’s most profitable business, and its net margin over the previous five years was among the hig hest in the industry.With oil prices at historic highs in early 2007, Midland anticipated heavy investment in acquisitions of promising properties, in development of its proved undeveloped reserves, and in expanding production. They also needed to account for competition from areas such as the Middle East, Central Asia, Russia, and West Africa. Refining and Marketing Midland had ownership interests in forty refineries around the world with distillation capacity of five million barrels a day. Measured by revenue, this side of the business was Midland’s largest. The relatively small margin was consistent with a long-term trend in the industry.Margins had declined steadily over the previous twenty years. Petrochemicals Petrochemicals is Midland’s smallest but most promising and undervalued division. Midland owned twenty-five manufacturing facilities and five research centers in eight countries around the world. Capital spending in petrochemicals was expected to grow in th e near term. [Midland Energy Case Analysis] Managerial Finance 1 In order to find the cost of capital for Midland Energy Resources and each of the three divisions within the company, we will need to use the formula or weighted average cost of capital (WACC) which is: ( )( rd= Cost of debt re= Cost of equity D= Market value of debt E= Market value of equity V= D+E= Value of the company (or division) T= Tax rate First, we can calculate â€Å"rd† for each division as it is outlined in the case by adding a premium/spread over US Treasury securities of a similar maturity. In other words: ( The two tables in the case are as follows: Table 1 Business Segment Consolidated E&P R&M Petrochemicals Credit Rating A+ A+ BBB AATable 2 Maturity 1-Year 10-Year 30-Year Rate 4. 54% 4. 66% 4. 8% Debt/Value 42. 2% 46. 0% 31. 0% 40. 0% Spread to Treasury 1. 62% 1. 60% 1. 80% 1. 35% ) ) ( ) *For my calculation, I used the 30-year maturity for E&P, R&M, and Midland as a whole as they take on longer term projects. I used the 1-year for petrochemicals as they tend to take on short term projects. [Midland Energy Case Analysis] Managerial Finance 2 Calculations are as follows: rd for Exploration & Production: rd for Refining & Marketing: rd for Petrochemicals: rd for Midland: Second, we need to calculate â€Å"re† for the three divisions as well as Midland as a whole.To find â€Å"re†, we will use the CAPM model outlined in the case: ( ) In order to solve this equation, we need to find beta for the three divisions. The case already outlines Midland’s overall beta at 1. 25. However, the case does not state the beta for the three divisions. We can calculate this using beta for publicly traded companied outlined in the case. Using the following formula, as well as exhibit 5 in the case, we can calculate beta for the three divisions: * ( ) ( )+ [Midland Energy Case Analysis] Managerial Finance 3 Exhibit 5(from case) Exploration & Production: Jackson Energy, Inc.Wi de Plain Petroleum Corsicana Energy Corp Worthington Petroleum Average Refining & Marketing: Bexar Energy, Inc. Kirk Corp. White Point Energy Petrarch Fuel Services Arkana Petroleum Corp. Beaumont Energy, Inc. Dameron Fuel Services Average Midland Energy Resources Equity Market Value 57,931 46,089 42,263 27,591 Net Debt 6,480 39,375 6,442 13,098 D/E 11. 20% 85. 40% 15. 20% 47. 50% 39. 80% Equity Beta 0. 89 1. 21 1. 11 1. 39 1. 15 LTM Revenue 18,512 17,827 14,505 12,820 LTM Earnings 4,981 8,495 4,467 3,506 60,356 15,567 9,204 2,460 18,363 32,662 48,796 6,200 3,017 1,925 -296 5,931 6,743 24,525 0. 30% 19. 40% 20. 90% 12. 00% 32. 30% 20. 60% 50. 30% 20. 30% 1. 7 0. 94 1. 78 0. 24 1. 25 1. 04 1. 42 1. 2 160,708 67,751 31,682 18,874 49,117 59,989 58,750 9,560 1,713 1,402 112 3,353 1,467 4,646 134,114 79,508 59. 30% 1. 25 251,003 18,888 Again the calculation to find Asset ? is: * Equity ? for Midland= 1. 25 ( ) ( )+ Equity ? for E&P= 0. 93*[1+ (1-39. 73%)*85. 19%] =1. 41 Equity? for R&M= 1. 05*[1+ (1-39. 73%)*44. 93%] = 1. 33 *85. 19% and 44. 93% come from Exhibit 1 in the case In order to get Equity ? for Petrochemicals, we will need to take a weighted average of the three divisions.The equation would be as follows: (w1, w2, w3 are based on the total assets of a division divided by Midland’s total assets). To find this, we will use the numbers from Exhibit 3 in the case: [Midland Energy Case Analysis] Managerial Finance 4 2004 E&P 76,866 R&M 60,688 Petro 19,943 Midland 157,497 2005 125,042 2006 140,100 Avg 114,002. 67 91,629 93,829 82,048. 67 28,000 28,450 25,464. 33 244,671 262,378 221,515. 33 Calculation for w1-3: W1= 114,002. 67/221,515. 33= 0. 51 W2= 82,048. 67/221525. 33= 0. 37 W3= 25,464. 33/221,515. 33= 0. 2 Now we can use the formula from before to find the ? for Petrochemicals: Lastly, we need to find EMRP to find â€Å"re† for Midland and the three divisions. We can find our EMRP number by looking at exhibit 6 in the case: Period 1987-2006 1 967-2006 1926-2006 1900-2006 1872-2006 1798-2006 Average excess return US Equities – T-Bonds 6. 4% 4. 8% 7. 1% 6. 8% 5. 9% 5. 1% Standard Error 3. 7% 2. 6% 2. 2% 1. 9% 1. 6% 1. 2% I will choose to use the average return from the time period of 1798-2006. That is the longest sample size in regards to time, as well as having the lowest standard of error.I will round down to 5% for ease of calculation: [Midland Energy Case Analysis] Managerial Finance 5 ( â€Å"re† for Midland= 4. 98%+5%*1. 25= 11. 23% â€Å"re† for E&P= 4. 98%+5%*1. 41= 12. 03% â€Å"re† for R&M= 4. 98%+5%*1. 33= 11. 63% â€Å"re† for Petrochemicals= 4. 54%+5%*0. 32= 6. 14% ) With this information, we are able to finally calculate the weighted average cost of capital (WACC) for Midland and the 3 divisions of the company. The formula and calculations are as follows: ( )( ) ( ) *D/V are provided in Table 1 for Midland, E&P, R&M, and Petrochemicals. They are 42. 2%, 46. %, 31. 0%, 40. 0 % respectively. WACC-cost of capital we need: WACC for E&P: ( =8. 32% WACC for R&M: ( =9. 29% WACC for Petrochemicals: ( =5. 10% WACC for Midland: ( =9. 17% [Midland Energy Case Analysis] Managerial Finance 6 ) ) ) ) The cost of capital (as shown above) will differ for the three divisions because the business operates in different industries. By being in different industries, the companies have different risk exposure and betas, while also having different credit ratings. All of these components will affect a company’s cost of capital differently.Further Analysis: Mortensen’s estimates were used for many things including performance assessments, mergers and acquisition proposals, stock repurchases, asset appraisals, and financial accounting. As stated in the case, cost of capital is a very important component in WACC calculations. These calculations were being used to evaluate at a divisional level as well as at a corporate level as a whole. In my calculations for the case, I solved for both levels. In regards to Midland’s corporate WACC, Mortensen computed the cost of debt for each division by adding a premium (or â€Å"spread†) over U.S. Treasury securities with an appropriate maturity depending on the division. For Exploration and Production (E&P), Refining and Marketing (R&M), as well as Midland as a corporation, Mortensen used a 30 year maturity TBond assumption as those divisions tended to focus on longer term projects. She decided on a 1 year T-Bond maturity assumption for Petrochemicals as they tended to focus on shorter term projects. Another assumption was that the tax rate (39. 73%) remained constant throughout the case as well as an EMRP of 5%.The EMRP was based on exhibit 6 of the case which examined TBonds during a certain period of time and with a certain standard of error. With a very low standard of error (based on the chart) and advisors, bankers, and investors covering the industry agreeing with 5% as an estimate, I believe the estimate to be appropriate. Analysts on the industry, bankers, and investors tend to have a broader look on companies within an industry as a whole. Lastly, Midland should not use a single corporate hurdle rate for evaluating investment opportunities in all of its divisions because each division is different.Midland is too large of a corporation, with different divisions, each containing its own unique set of risks. Due to the fact that the risk for each division will be different, I believe the corporate hurdle rates for those divisions should also be different to reflect a more accurate corporate assessment. I believe Mortensen did a great job with the information she was presented with in the case and I believe Midland Energy will continue to be a prominent company within the industry. [Midland Energy Case Analysis] Managerial Finance 7

Essay on New Public Management - 1913 Words

The New Public Management is not a simplistic Big Answer, but rather, it is a normative reconceptualization of public administration consisting of several interrelated components, which creates innovative bureaucracies that provide better services . This essay shall be against the notion that public sector should run like a business, by discussing the origin of the New Public Management (NPM) in relation to globalization and the Cold War, while also depicting its negative implications on anonymity and accountability which are essential to the running of the Public Sector due to ministerial responsibility. To conclude, a future description of NPM on Canada shall be given in order to affirm my stance. The New Public Management plays a†¦show more content†¦This obviously shows how the normal expenditure for the country was made to increase due to the wartime crisis in which Canada found them. Spending enough money in order to protect the country as well as protect the soldiers from the enemy skyrocketed into a future deficit. The public seemed to turn a blind eye at the time because they felt that any expenditure needed should be made available for the Defense department, nonetheless, they were not aware of the future implications of their support. This case of Canada is particularly illustrative because, when the Cold War drew to a close, Canadian defense spending topped 12 billion dollars per annum, funding that supported a total of 100,000 tri-service combat troops, support personnel, and reserves . This clearly shows how much debt they accumulated with only the Defense department in which the public supported wholeheartedly during the Cold War. Now, their only solution here would be to adopt the New Public Management policy since it would help them in cutting down their usual expenditure for the country, in addition to allowing them achieve the public trust completely by still providing services in an efficient manner. Similarly, Public administrators have become increasingly aware of the changing nature of public service, owing to globalization, on the eve of the newShow MoreRelatedNew Public Management ( Npm )1383 Words   |  6 PagesNew Public Management (NPM) was developed in response to some criticisms of the public sector. One of them is to make the public sector more financially accountable since they need to demonstrate to the government who provides them funding, that the money is being put into good use. They also need to ensure efficient resource allocation (Peyton) because resources are limited yet there is an increase in expectations and demands. 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The government fulfills a responsibility to citizens because they ensure that there are procedures to guarantee successful operation of democratic principles through voting, representation and due process (Catlaw Denhardt, 2015, 2011, 2008). As citizens we have the role of developing the capacity to