Drawing on historical and contemporary evidence, I argue that these two threats are symptomatic of a growing structural imbalance in all economies, which is how nature is exploited to create wealth and how it is shared among the population. The root of this imbalance is that natural capital is under-priced, and hence overly exploited, whereas human capital is insufficient to meet demand, thus encouraging wealth inequality.
The editors of Triple Crisis blog received the following letter from regular contributor Sunita Narain and her co-author Chandra Bhushan about their recent report on U.S. government policy on climate change. “Captain America: U.S. Climate Goals—A Reckoning.” They raise tough criticisms of the weak and halting steps that the U.S. government has taken, and express apt concern about whether U.S. ways of production and consumption can long persist—let along be replicated around the world—without causing irreversible and catastrophic harm. Make sure to check out the links, to a summary of key findings and to the full report. —Eds.
We are sending you a link to our just released report, Capitan America in which we take a close and careful look at the U.S. government’s action plan on climate change.
We write this report knowing that the threat of climate change is real and urgent. We know this because we in South Asia are already seeing horrific impacts of changing weather, hitting the most poorest and most vulnerable. We strongly believe the world needs an effective and ambitious climate change deal. In this context we ask if the U.S. climate action plan is ambitious, equitable or sufficient? We ask this because it is said that even if U.S. Intended Nationally Determined Contribution (INDC) is not ambitious, it signals a change in the country’s position. And that it will build momentum in the future. The question is if the U.S. is on track to make real reductions in greenhouse gas emissions?
Has the financial sector become too large, absorbing too many resources, and enhancing instabilities? A look at the recent evidence on the relationship between the size of the financial sector and growth.
There has been a long history of the idea that a developing financial sector (emphasis on banks and stock markets) fosters economic growth. Going back to the work of authors such as Schumpeter, Robinson, and more recently, McKinnon, etc., there have been debates on financial liberalisation and the related issue of whether what was relevant to financial liberalisation, namely financial development, “caused” economic development, or whether economic development led to a greater demand for financial services and thereby financial development.
The general thrust of the empirical evidence collected over a number of decades suggested that there was indeed a positive relationship between the size and scale of the financial sector (often measured by the size of the banking system as reflected in ratio of bank deposits to GDP, and the size of the stock market capitalisation) and the pace of economic growth. Indeed, there have been discussion on whether the banking sector or the stock market capitalisation is a more influential factor on economic growth. The empirical evidence drew on time series, cross section, and panel econometric investigations. To even briefly summarise the empirical evidence on all these aspects is not possible here. In addition, the question of the direction of causation still remains an unresolved issue.
This week the U.S. Senate is expected to begin consideration of a controversial bill that would, in the guise of “safe and accurate food labeling,” make the labeling of genetically modified foods nearly impossible. It would undercut state-level labeling initiatives, such as the one approved in Vermont. The Real News Network sat down with Timothy A. Wise to discuss the ongoing battle over GM food, based on his recent article, “The GM Food Labeling Law to End All Labeling Laws.” Wise has followed the controversy as part of his research on A Rights-Based Approach to the Global Food Crisis, with articles on the scientific controversy (here and here) and a series on the industry push to get GM maize approved for planting in Mexico (articles 1, 2, 3). Wise was interviewed at the Political Economy Research Institute (PERI) at the University of Massachusetts, where he is a Senior Research Fellow.
Arthur MacEwan is a professor emeritus of economics at the University of Massachusetts-Boston and the author of Neo-liberalism or Democracy? Economic Strategy, Markets and Alternatives for the 21st Century (1999), Debt and Disorder: International Economic Instability and U.S. Imperial Decline (1992), and (with John Miller) Economic Collapse, Economic Change: Getting to the Roots of the Crisis (2011).
Puerto Rico is a colony of the United States. Colonial status, with some exceptions, is not a good basis for economic progress.
Recently, the details of the Puerto Rican economic mess, and especially the financial crisis, have become almost daily fodder for the U.S. press. Yet, the island’s colonial status and the economic impact of that status, which lie at the foundation of the current debacle, have been largely ignored.
Puerto Rico, like other colonies, has been administered in the interests of the “mother country.” For example, for many years, a provision of the U.S. tax code, Section 936, let U.S. firms operate on the island without incurring taxes on their Puerto Rican profits (as long as those profits were not moved back to the states). This program was portrayed as a job creator for Puerto Rico. Yet the principal beneficiaries were U.S. firms—especially pharmaceutical firms. When this tax provision was in full-force in the late 1980s and early 1990s, it cost the U.S. government on average more than $3.00 in lost tax revenue for each $1.00 in wages paid in Puerto Rico by the pharmaceuticals. (What’s more, the pharmaceuticals, while they did produce in Puerto Rico, also located many of their patents with their Puerto Rican subsidiaries, thus avoiding taxes on the profits from these patents.)
Regular Triple Crisis contributor Patrick Bond participated in a recent forum with Capital in the Twenty-First Century author Thomas Piketty at the University of the Witwatersrand. A short account of Bond’s reflections on Piketty is available at the link just below, and several other contributions to the discussion of Piketty’s analysis and its relevance to South Africa today are in the “What We’re Reading” section:
If you read or watched or listened only to the mainstream media in the North, you could be
forgiven for believing that the current influx of refugees into countries of Europe is not just
an important concern, but actually even the single biggest crisis in that continent. You might
also think that the flow of desperate refugees escaping from terrible conditions is mainly
confined to that region, and that their numbers are so large that the societies will be simply
unable to cope, because of the hugely increased burden on basic infrastructure and facilities
in those countries.
Every day television screens show images of people pouring into towns and cities, crowding
up border crossings or landing at sea (if they are lucky) and filling up transport hubs in
certain European countries. International and national newspapers carry stories of some
compassion, along with greater instances of more xenophobic responses of local
populations. Government leaders (particularly in eastern and central Europe) are shown
declaring that their country cannot possibly take in so many people, many of whom may not
even be “real” refugees but simply economic migrants. Borders are being reinforced and
aggressively policed; walls and barbed wire fences are being put up; desperate groups of
travelers are even being shot at in the attempt to prevent further influx.
Yet this tragic phenomenon that is receiving so much global publicity is but a small trickle in
the huge flow of people displaced globally by wars and conflicts in the areas where they live.
According to the UNHCR, in 2014 alone, nearly 14 million people were forcibly displaced due
to civil war or other violence. Most of these moved within their own country – 11 million
people, who are internal refugees losing everything, and often retaining only the most
uncertain of citizenship rights precisely because of the internal conflicts.