Brookings: Experts - Michael W. Klein

What's the Big Deal about Cyprus?

Michael W. Klein — Wed, 20 Mar 2013 00:00:00 -0400

Editor's Note: In an interview with the GlobalPost, Michael Klein explains what made the terms of Cyprus's rejected bailout controversial and this situation might mean for the rest of the eurozone.

Why did the Cyprus bailout package cause such uproar?

With insured deposits, there is a guarantee that there will be no confiscation of depositors’ money. Even just the fear of a bank run can lead to a bank run. In the 1930s, none of the deposits were guaranteed by the government and that led to bank runs, which in turn deepened the Great Depression. Government guarantees on insured deposits took away most of those fears.

[The Cyprus bailout] is a little bit of crossing the Rubicon to start charging depositors a tax on what they perceived to be insured deposits.

The real concern is not so much what’s going on in Cyprus, but if this becomes a method by which bailouts are funded. Then, there is concern that this could lead to bank runs all over Europe, as other countries’ banks are imperiled.

If the same kind of thing happens there, it could be really problematic.

What are the potential risks of a bailout that includes taxes on depositors’ accounts? Is it a bad precedent to set?

I think it is a bad precedent. It doesn’t distinguish between bad banks and good banks. And it means that deposit insurance might not mean what they say it means.

The bank run is an infrastructure thing because then banks start to shut down and it starves the economy of credit. Historically, we've seen that in situations where banks fail, the depressions that ensued were deeper, more severe and more protracted than recessions that arose for other reasons.

Even though concessions were made to let small depositors off the hook for the tax, the bailout was vetoed by the Cyprus government. What does this mean for Cyprus and for the rest of the Eurozone?

There’s a problem with letting small depositors off the hook logistically, because what could happen is people could split up their deposits and all of a sudden big depositors could look like small depositors. Presumably they have information beforehand, so people couldn’t do that. If you had a deposit in excess of a 100,000 euros before, you can’t hide it.

For Cyprus [a veto] means they have to go back to the negotiating table. Either they get cut off from the bailout funds or there’s a realization on all parts that this was a problematic solution and they go back to the table.

The problem is though – people have been talking about this for a while now – if one country exits the Euro area, it could cause a cascade. People have not been focusing on Cyprus so far. People have been focusing on Greece, of course. If Greece were to exit, the concern is, ‘who’s next?’

If Cyprus exits… if they don’t get the bailout and they drop out of the euro, then the question arises again of who’s next. That question has always been one of the big issues in Europe. As market psychology moves against countries, the most immediate problem is that sovereigns have to pay, and everybody else has to pay, much higher interest costs.

These interest costs had been coming down and it seemed like things were settling down as compared to a year or two ago, but now the question arises about whether this will cause interest rates to spike up again.

The Dutch finance minister and Deutsche Bank’s Chief executive have said this is unlikely to be a model for other countries. Why was Cyprus a special case? How would this affect other vulnerable countries like Spain and Italy?

Cyprus is seen as a financial center where the banks are outsized given the size of the economy. There’s also an issue with a lot of foreigners parking their money in Cyprus. But, nonetheless, people might not necessarily perceive it as a special case.

On Monday morning when banks opened in Spain and Italy, there were no bank runs. Some people cite that as evidence that Cyprus is a special case. On the other hand, it could be the case that the tinder has gotten a lot drier and a spark can do a lot more damage.

The fact that it hasn’t happened yet doesn’t mean it’s not going to happen.

Greece is still a real problem. Greece doesn’t show signs of recovery. There has been some shift in other countries, but they’re operating in an environment of very weak growth for Europe as a whole. In the last week or so, Germany has talked about not providing for the stimulus to its economy, which means that Germany’s not going to be an instrument of growth for Europe.

The three problems in Europe are the sovereign debt crisis, the banking crisis and slow growth. They’re all interconnected with each other. You can’t solve one without solving another.

The banking crisis, part of it has to do with non-performing loans, so slow growth affects the banking crisis. The banking crisis means that credit is less available, and that contributes to slow growth. Slow growth makes tax receipts lower for the sovereigns, so their debt crisis is worse because the cyclical part of their deficit is large. And then banks hold sovereign debt, and when that looks more imperiled, the banks are more imperiled. All these three things are very interconnected. You can’t really solve one without solving the other two.

So far they seem to have pushed austerity measures as a way of dealing with the Eurozone crisis. Do you think that’s the wrong approach?

In a lot of countries, ultimately there has to be a scaling back of government spending and a way to raise taxes. However, in the midst of a deep, deep downturn, austerity just makes the situation worse.

It’s sort of an extreme example of what’s happening in the United States. In the United States, we seem to be coming out of a recession, and the government’s deficit has been bigger because of the recession. If we started cutting the deficit right now, we would provide very strong headwinds to the recovery.

In Europe, it’s like that but much more severe. They’re in a much worse situation. These countries are just stuck in a deep cycle of austerity and slow growth, which means further deficit problems, which raises more demands for austerity, and so on.

It seemed like things were getting a bit better but this is raising concerns so the Eurozone crisis may be back in the headlines. There may be second round effects around what’s going on in Cyprus, especially that they’re willing to cross the Rubicon now.

Once you start not distinguishing between banks that are better off and banks that are worse off, once you say insured deposits are not really insured and are open for taxation, that leads to a lot of concern about the banking system. It might start to show up in other countries as well.

Authors

Michael W. Klein

Publication: GlobalPost

Image Source: © Yannis Behrakis / Reuters

Time to Call a Truce in the Currency Wars

Michael W. Klein — Fri, 01 Mar 2013 00:00:00 -0500

Yes, the yen has weakened and the pound has gotten pounded, but worries about an all-out currency war may be overblown.

There's a perception that some countries' economies are being harmed by currency movements that have been undertaken to gain an unfair advantage.

That may be a bit misguided.

In the United States, the threat of a fiscal contraction due to sequestration has prompted the Federal Reserve to take actions that could weaken the dollar.

Signals suggest that the new head of the central bank in Japan will pursue a more expansionary policy in an effort to stimulate that country's long-moribund economy.

These actions are taken for purely domestic reasons, but they could have consequences for currencies.

In anticipation of frictions that could arise, there was an agreement by the G-20 nations at the recent Moscow summit to refrain from so-called competitive devaluations.

But, since then, governments such as South Korea and New Zealand have signaled a desire to pursue explicit policies to weaken currencies, or even to impose capital controls.

Read the rest of the opinion at cnn.com »

Authors

Michael W. Klein

Publication: CNN

Image Source: © Toru Hanai / Reuters

Counsel for President Obama's Second Term

Michael W. Klein — Wed, 23 Jan 2013 00:00:00 -0500

The economy has recovered substantially from the situation the president faced at his first inaugural. But challenges remain. The recovery from the Great Recession that began in 2008 has been slower than the recovery from the other recessions over the past three decades, largely because the source of this recession, a major financial upheaval, differs from the sources of recessions of the past.

The first and primary economic goal is to keep the recovery on track. This is important so unemployment will continue to decline. It will also bring down the government budget deficit by raising tax revenues and decreasing social safety net expenditures. The president is typically blamed (or credited) too much for the macroeconomic performance of the country, however. Many important factors are outside the president’s control. For instance, one of the biggest threats to the U.S. recovery now is events in the Euro-area, something over which the president has very limited influence. The recovery could be derailed by ongoing uncertainty due to political fights over tax-and-spending policy. Congress needs to work with the president on this, putting the needs of the nation ahead of narrow partisan goals.

The political fights about the fiscal cliff have raised the issue of tax and entitlement reform. These are difficult political issues. Everyone is for reforming the tax system and reforming entitlements, except for those parts that are essential to the American way of life—that is, those features that they benefit from, such as mortgage interest deductions, farm subsidies, low rates for carried interest, etc. A major reformation of taxes and entitlements would be difficult to obtain; then again, health-care reform eluded past presidents as well.

Authors

Michael W. Klein

Publication: Tufts University

Image Source: © Larry Downing / Reuters

Is U.S. Immigration Policy Holding Back Economic Growth?

Susan Cohen and Michael W. Klein — Fri, 02 Nov 2012 00:00:00 -0400

In these final days of the presidential campaign, both President Obama and Governor Romney are becoming more vocal about their support for immigration reform. While there is still distance between their stances, both agree that it is important to encourage foreign entrepreneurs to come to America and launch their dreams here.

This is smart and sound. By providing a fair and unencumbered immigration path for entrepreneurs and emerging foreign businesses, we lay a foundation both for stimulation of the local economy and for U.S. job growth.

But the best policy intentions are thwarted when the immigration bureaucracy slams the door in the faces of foreign business talent.

Here's an example. A foreign technology company with a very exciting proprietary software product received three rounds of venture capital funding and was ready to launch a major presence in the U.S. They planned to transfer the two founders and several of their technology experts to New York for a few years to solidify the new U.S. operation, gain U.S. customers, and hire and train new U.S. employees. The rest of the company's staff would remain abroad. They wanted to spend their new infusion of several million dollars in venture capital in the U.S. market. But they wouldn't just spend the company's money to buy office equipment and furniture and hire U.S. workers, lawyers and accountants. They were prepared to lease apartments, buy cars, buy furniture for their apartments, eat at New York restaurants, and take vacations in the U.S.

But before any of this could play out, a U.S. immigration officer denied the visa applications of these talented and eager entrepreneurs. The official rejected the applications because he did not believe that the applicants' technical knowledge was specialized enough to qualify for a visa, even though they invented and created the technology from scratch.

Visa scenarios like this one are disturbingly common and out of step with encouraging investment in the U.S. The Department of Homeland Security recently published statistics on the approval rates for visa applications for companies seeking to transfer expert personnel to the U.S. Over the last four years the approval rate for these applications has dropped more than 20 percent!

The cumulative effect of this increasingly hostile attitude towards foreign entrepreneurs and businesses is significant. According to a recent study published by The Kauffman Foundation, immigrant-led businesses have generated $63 billion in sales and have generated a whopping 560,000 jobs since 2006. But the study goes on to say that immigrant-run high tech companies are no longer growing. Since 2006, the proportion of new companies founded by foreign-born entrepreneurs has begun to decline, after two decades of consistent growth. Silicon Valley experienced an especially steep decrease. Some of the most exciting new high tech companies are now launching their operations abroad. We are missing out on all of the economic gains that we would have enjoyed had we opened our doors to these companies.

Our immigration bureaucracy is not in step with the administration’s approach of encouraging investment and opportunity in the U.S. Until this is remedied, it's not just foreign entrepreneurs who lose out when their visa applications are denied; our U.S. economy loses as well.

Authors

Susan Cohen
Michael W. Klein

Publication: Yahoo! Finance

Image Source: © Keith Bedford / Reuters

A Conversation about the Greek Elections and the Future of the Eurozone

Donald Kohn, Douglas J. Elliott and Michael W. Klein — Mon, 18 Jun 2012 00:00:00 -0400

Following the New Democracy party's victory in the Greek elections on June 17, Donald Kohn, Douglas Elliott and Michael Klein discussed the vote's implications for Greece and the euro, the situation in Spain and the G20 summit.

“My point of view: we dodged a bullet, but the gun is still loaded. And even outside of Greece, maybe particularly outside of Greece, there are many other areas where things could go wrong.” - Doug Elliott

“The election is good news for the global financial system because if nothing else it’s going to buy some time and give these guys a chance to adjust to potential downside risk.” - Donald Kohn

Topics covered by Elliott, Klein and Kohn include:

The worst case scenario that was avoided with the New Democracy party's victory.
The short- and long-term problems facing Greece, including its unsustainable debt level in the government and the country's lack of competitiveness in private sector business.
Whether the election's results will effect other European leaders' willingness to help by moving Greece's deficit targets.
What this result may mean for Spain, Portugal and other countries facing similar situations.
Europe's negative effect on financial markets and the global economy, including the United States.

Audio

Conference Call on the Election in Greece

Authors

Image Source: © John Kolesidis / Reuters

Switzerland May Find Itself In a Currency War

Michael W. Klein — Thu, 07 Jun 2012 16:25:00 -0400

Switzerland is a country with a long and proud tradition of neutrality, but given the perilous state of the surrounding eurozone, it may be find itself in a "currency war" as the Swiss franc strengthens in response to capital inflows.

An appreciation has adverse consequences for Swiss exports, and overall national income. The Swiss central bank combated appreciation with intervention in the foreign exchange market in September, and promises to intervene again if the franc appreciates past Sfr1.20. But Swiss authorities are considering deploying a new weapon as well. Last month, Thomas Jordan, the head of the Swiss National Bank, indicated that he was prepared to use capital controls.

The currency war facing Switzerland is reminiscent of the appreciation of the Brazilian real in 2009 and 2010. Mr. Jordan's proposed use of capital controls echoes the Brazilian response. He would be wise to consider that experience, and its lessons about the efficacy of capital controls. Capital controls offer a limited capacity to prevent appreciations in emerging market countries. They are likely to be even less effective for Switzerland.

In 2009, strong Brazilian growth and low interest rates in advanced countries drove international capital to Brazil, causing a 35 percent appreciation of the real that threatened the country's export sector. Brazilian authorities responded by introducing a 2 percent tax on foreigners investing in Brazilian equities, the IOF (Imposto sobre Operações Financeiras). Brazil's real's appreciation halted after this - but, as in so many cases, correlation does not imply causation, since other emerging market currencies also depreciated after October 2009, notably the Korean won and the Indonesian rupiah. The real began to strengthen again after June 2010. This prompted a tripling of the IOF rate in October 2010 and an effort to tighten its bite by closing loopholes. This policy, too, saw only a temporary slowing in the appreciation of the real.

Capital controls fail to stem appreciations because they are leaky. Investors find ways around regulations intended to limit inflows, often by using different financial instruments than those on which controls are directly imposed. This work-around suggests that capital controls are least effective for countries with the most sophisticated financial markets, that is, for countries like Switzerland. Experience also shows that controls are less effective when they are imposed episodically, in response to current conditions, rather than when they are long-standing.

The first round of capital controls are typically followed by subsequent rounds that ratchet up tax rates and widen coverage. This was the experience of Brazil, with the IOF rate tripling in 2010 and the regulations being expanded to new instruments. It also characterizes recent experiences of other countries, such as Colombia, Peru, and Taiwan.

China provides an example of the exception that proves the rule. The government maintains control over capital inflows which allows it to manage the value of the renminbi. It can do this because it has relatively rudimentary capital markets and, more importantly, a long history of unwavering capital controls. In contrast, Brazil has increasingly sophisticated capital markets. Some of the increasing sophistication is precisely because of incentives arising from capital controls -- just as in other countries, financial markets respond to regulation with innovation. The episodic nature of Brazilian capital controls, as well as those of other countries, also makes circumventing them easier.

There may be a role for capital controls, however, for some countries and in some instances. The financial crisis has prompted a re-examination of the range of policies that may be useful for strengthening financial systems. Notably, the IMF recently has shifted its views towards a greater acceptance of capital controls that aim to reduce financial vulnerability. But the efficacy of these policies remains an open question. Most likely, there is not a single answer to the question of the efficacy of capital controls; rather the answer differs across countries and even across time for a particular country. Nevertheless, experience suggests that efficacy of capital controls is especially questionable for advanced economies like Switzerland.

Battling inflows is a difficult challenge. The battle is not helped, however, by the use of ineffective weapons.

Authors

Michael W. Klein

Publication: Real Clear Markets

Image Source: © Denis Balibouse / Reuters

"Dark Clouds on the Horizon" in Europe, Says IMF

Michael W. Klein — Sat, 21 Apr 2012 14:24:00 -0400

This weekend's meetings of the International Monetary Fund and the World Bank are overshadowed by "dark clouds on the horizon" that threaten the "light recovery blowing in a spring wind," according to Christine Lagarde, the managing director of the IMF.

The main source of the dark clouds is Europe, where recovery remains weak.

More than three years into the crisis, policy options in Europe are limited; fiscal stimulus is out of reach for many countries, and recent efforts by the European Central Bank provided only a temporary respite. In this environment, strong and sustained recovery depends upon rebalancing within Europe, whereby countries' trade imbalances are reduced.

But rebalancing is a two-sided affair. We have all heard the ongoing calls for some European countries to rebalance deficits through painful austerity measures.

These calls need to be balanced with demands that countries with surpluses also move to rebalance.

In particular, Germany must take advantage of its scope for fiscal expansion to bolster European recovery and to forestall its own slippage towards an economic slowdown.

There are those who argue that the German surplus reflects its productivity growth and labor market reform. These people argue that Germany could only rebalance by stifling its own economic dynamism.

There are three responses to this argument:

Shared rewards: Reforms have made labor markets more flexible in Germany. Innovative policies, such as the Kurzbeit, the short-time working policy, limited the unemployment effects of the crisis.

German unemployment briefly peaked at 8% in July 2009 while the U.S. unempoloyment rate spiked to 10% in October of that year. Despite the soft landing, workers have not fully shared in the benefits of the recovery, and trade unions have been demanding higher wages.

Higher wages for workers would raise their demand for consumer goods, including the products from other euro-area nations.

Shared consequences: German exporters, and German producers of import-competing goods, have benefited from the weak euro.

Since 2008, the German real exchange rate has depreciated by almost 9%, even while its economy recovered relatively strongly from the crisis and its economy was strongly in surplus.

In contrast, over this same period the Swiss franc appreciated 16% -- estimates suggest that had the German real exchange rate tracked the Swiss real exchange rates, German export growth would have been cut in half.

Another major surplus country, China, saw an appreciation of its real exchange rate by more than 10% over this period.

If Germany had a free-floating currency of its own, rather than one whose value is determined by the fate of the full set of euro members, it would have seen an appreciation that would have brought down its current surplus.

Shared experiences: Another surplus country offers a striking recent example of rebalancing: China. In 2007, China's surplus exceeded 10% of its GDP.

The IMF projects that the debt to GDP ratio will fall to 2.3% in 2012, well below the 6.3% forecast published in its World Economic Outlook last year. In contrast, the most recent IMF forecast of the 2012 German debt to GDP ratio, of 5.2%, exceeds last year's forecast of 4.6%.

As a member of the euro area, Germany will not see the natural forces of a currency revaluation bring about a reduction in its current surplus.

But the government has the tools available to rebalance, and foster growth both domestically and more widely in Europe, through a stimulative fiscal expansion.

There are other tools available as well, such as policies to promote female labor force participation (which is low relative to other industrial countries) and liberalizing retailing (which could help promote domestic demand), to raise growth and to widen its benefits among its citizens.

Rebalancing needs to occur for both deficit and surplus countries to support and sustain growth during these challenging times.

Authors

Michael W. Klein

Publication: CNN Money

Manufacturing: Not a Magic Pill for the Economy

Michael W. Klein — Mon, 20 Feb 2012 00:00:00 -0500

In 1983, in the midst of a deep recession, Bruce Springsteen recorded the song "My Hometown" that reportedly was based on the closing of the Karagheusian Rug Mill in Springsteen's own home town of Freehold, N.J.

The song's theme of economic hardship from the displacement of manufacturing jobs resonated, propelling it to 6th place on the Billboard charts.

Today, in the midst of an even deeper and more prolonged recession, the 1980s debate about whether manufacturing matters is front and center.

In his State of the Union speech, President Obama said that the blueprint for economic recovery "begins with American manufacturing."

There are, of course, welcome developments. But anecdotes about some firms' successes are not representative of the performance of an entire industry. It is magical thinking to believe that manufacturing can reclaim the role it had in the mid-20th century, and be the main driver behind the resurgence of today's economy.

Let's start with some perspective: the 300,000 new manufacturing jobs created since the depths of the Great Recession represent only 8% of total job growth.

This is less than proportionate to the relative size of manufacturing. Its current share of employment is only about 9% of the nation's overall total.

In the 1980s, manufacturing employment commanded a 21% share of the overall total. Over the past three decades, employment in manufacturing has decreased about 40%.

So while manufacturing has been a bright spot lately, this is a story of productivity gains, not of employment growth.

Thanks to productivity gains, the employment drop occurred while the value added by manufacturing increased by 40%. Hourly compensation to workers has remained stagnant. So the question arises: who benefits from policies to support manufacturing, workers or owners?

It is easy for a casual observer and politician to attribute an outsized role to manufacturing in employment terms, given the attention afforded factory closings or hiring surges by a particular firm.

Manufacturing is characterized by "churning" -- simultaneous job creation and destruction. On average, about one in five manufacturing jobs are either destroyed or created each year, and that churn is not especially concentrated within some narrowly defined manufacturing sector.

And job destruction occurs in good times as well as bad; the Karagheusian Rug Mill closed in 1964 in the middle of a decade-long national economic expansion.

The U.S. experience is shared by other countries, formerly known as "Industrial Nations." Over the past three decades (up to just before the most recent recession), the share of manufacturing employment in the United Kingdom fell from 25 % to 9%.

Even Germany and Japan -- two countries seen as manufacturing powerhouses -- have had substantial declines in the share of employment in manufacturing, declining from 27% in Germany in 1991 to 19% in 2007, and in Japan from 32% to 20% over the same period.

The case has also been made that manufacturing matters because of exporting.

A bit more than half of all U.S. exports are manufactured goods, and two-thirds of these manufacturing exports come from four sectors: chemicals, transportation equipment, computers and electronic products, and machinery.

Policies to promote exporting would, therefore, disproportionately favor a relatively small set of firms in these sectors.

How small a set? Only about 4% of manufacturing firms in the U.S. exported in 2000 and 96% of all U.S. exports are sold by just 10% of this already small set of firms.

It may be possible to expand the set of firms that export, rather than just the export activity of those that already sell abroad, but the extreme concentration of exporting gives one some pause about export-promoting policies.

And exporting is not an end in itself. Is there some special feature of exporting that benefits workers as well as owners?

There is evidence of a wage premium paid to workers in exporting firms, but those workers also tend to have more education and skills than those in non-exporting firms. Part of the premium is due to this.

Since higher education and skills result in higher wages, it would be well worth considering policies promoting the skills and education of workers, regardless of the industry in which they are employed.

Safety nets for those suffering from economic dislocation, regardless of the industry in which they had worked, are also important policies in a modern, dynamic economy on both equity and efficiency grounds.

It is much less apparent that the same can be said of policies targeted to manufacturing industries.

Authors

Michael W. Klein

Publication: CNNMoney

Central Banks’ Recent Experiments with Capital Controls Not Very Effective

Mon, 01 Jan 0001 00:00:00 -0500

Distinction between episodic and long-standing restrictions is important; recession caused shift in exchange rate policies

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Central Banks’ Recent Experiments with Capital Controls Haven’t Delivered Results

SEPTEMBER 13, 2012 -
The recent use of short-term capital controls has not helped governments stop exchange rate appreciations, prevent asset price booms and busts, nor avoid general economic volatility post-Great Recession, according to a new paper presented today at the Fall 2012 Conference on the Brookings Papers on Economic Activity (BPEA).

In “Capital Controls: Gates and Walls”(pdf), author Michael Klein of the Fletcher School of Tufts University, and former Chief Economist for the Department of the Treasury’s Office of International Affairs, performs an analysis of the use of capitol controls in 44 countries over a 15-year period, looking at the pattern of capital inflows and their effects on financial variables, GDP, and exchange rates. Given that controls on capital inflows have been receiving increasing support in policy circles, among researchers, and in the general economic debate, especially since the onset of the Great Recession, he looks specifically at the differences between long-standing controls on a broad range of assets (walls) and episodic controls that are imposed and removed, and tend to be on a narrower set of assets (gates). Klein finds that longstanding controls help reduce both financial vulnerability and increase GDP growth while episodic controls are far less effective, but that in fact neither long-standing nor episodic controls significantly affect exchange rates, which may be one of the central banks’ key goals in pursuing these policies.

Klein writes that some theories support the use of episodic controls against surging capital inflows, or to guard against a boom/bust cycle, but there is little or no theoretical support for long-standing capital controls. “Long-standing capital controls are like walls that protect against the vicissitudes of international capital markets… [they] tend to be wide as well as high, limiting all manner of capital flows, including those that could provide cheap capital, financial development, and opportunities to diversify risk. An alternative, episodic capital controls could open like gates during tranquil times to enable an economy to benefit from international capital, but swing shut in the face of capital inflows that threaten to cause an unwanted appreciation or a destabilizing asset market boom. The transitory nature of these controls, as well as having them targeted towards particular categories of assets, would make them less distortionary and inefficient than broad, long-standing controls.” But he notes that there are problems with the gates: they might not latch shut tightly, they may shut too late or there may be impediments to their closing.

Klein points out that the differences in the effects between long-standing and episodic controls may have been less apparent 15 years ago than today because there was a trend towards the liberalization of long-standing controls up through the mid-1990s. He finds that China’s long-standing controls are important for the government’s ability to manage the value of the Renminbi whereas Brazils’ recent attempts to use episodic controls were ineffective.

Download the paper (PDF) »

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Central Banks’ Recent Experiments with Capital Controls Haven’t Delivered Results