November » 2012 » TripleCrisis

What to expect when you are electing

Today, the United States will choose between a moderate Republican, with a pro-business agenda, or Mitt Romney. Yes President Obama has saved the economy from a 1930s-like catastrophe with a smaller than necessary, but still very effective, fiscal package, and monetary easing has prevented a collapse of the banking and financial sector like the Great Depression one. Yet, his economic views and policies remain to the right of Richard Nixon. Obama agreed with Mr. Romney that government does not create jobs, and has accepted the anti-Keynesian rhetoric regarding the need of reducing the fiscal deficit, even though the recovery has been very slow.

If Obama wins (and I do believe that Nate Silver is right and his chances are greater than Romney’s) we should not simply expect a continuation of the current policies. Yes, Ben Bernanke will maintain interest rates close to zero in nominal terms and continue the gradual Quantitative Easing which, precluding a collapse of the euro and the flight to dollar denominated bonds, will lead to a more depreciated dollar. But the US cannot expect to grow through exports, particularly to developing countries like China (China bashing was one the silliest and most disingenuous issues raised during the campaign).

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Triple Crisis Roundup: Hurricane Sandy

Eli Epstein-Deutsch, Triple Crisis Assistant Editor

It was as though the world had gone off its tilt. Half of Manhattan skyline lay dark, giving the island the appearance of Two-Face, when viewed from the borough of Brooklyn, where many the downtown gentry had taken refuge from the blackout. Across New York City, casual social gatherings turned into week-long campouts. Meanwhile, residents of housing projects in the Lower East Side, many unable to evacuate, have struggled with the lack of food, water, and electricity. The impromptu community, the forced immobility, and the humanitarian demand posed by Hurricane Sandy have all combined to make the period one of introspection and reflection.

The disaster leaves behind disquieting thoughts and hard questions. Even the most affluent have been shown their precariousness; a major financial center lay paralyzed in a fashion associated with developing world cities. At the same time, the extremes of economic inequality were visible in the outcomes, with the poorest areas especially ill-equipped to respond to the disaster. The island of Haiti, whose agricultural production was devastated by flooding, faced by far the highest death toll and still suffers an ongoing food crisis. If anything is really to be salvaged from the destruction, it will be if the sense of temporary solidarity grows into a real reckoning with challenges that face us from here: of creating a safe and stable supply of energy in the era of catastrophic climate change, and of confronting the widening social disparities that make some of us much more vulnerable than others to the consequences of that change.

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The West almost succeeds in marginalizing the UN Conference on Trade and Development

Robert Wade, Guest Blogger

When the UN Conference on Trade and Development (UNCTAD) was being established in 1964 in Geneva as a kind of think tank for developing countries, developing countries argued that it must have a mandate for financial issues because of the close link between finance and trade. Western states said “over our dead bodies”: finance is for us and our organizations.

The deadlock was broken at the last minute when Ted Heath, then President of the British Board of Trade (later Prime Minister) came to Geneva for the final round of negotiations and met up with one of the leaders of the developing country side, an Algerian who had been his Oxford college mate years before. They went into a small private room and emerged with a compromise: that UNCTAD could appropriately concern itself with the “invisible account” in the balance of payments as it related to trade. The invisible account included finance. The western side reluctantly agreed.

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Econ4 The Bottom Line: Jobs

Econ4.org, a new platform for discussing and promoting urgent structural changes needed for a healthy American economy, is now introducing a five part video series called The Bottom Line. The videos will cover Jobs, Housing, Healthcare, Regulation and The New Economy. In the first one, Jobs, they argue that tax cuts and spending cuts, far from stimulating job creation, are counterproductive. They make the case that government has a significant role to play in generating employment growth.

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