The Time Bomb of Public Private Partnerships

Philip Arestis and Malcolm Sawyer

The South London Healthcare Trust, which runs three hospitals in south-east London, has recently been put into administration by the UK Secretary of State for Health as it struggles with its debts and deficits (see, for example, PFI will ultimately cost £300bn, Guardian, 5th July 2012). This story has much wider significance than a struggle with the effect of cuts in health expenditure, as much of the blame for the financial plight of this healthcare trust is being put at the door of the costs of the use of the private finance initiative (PFI) for the construction of two of the hospitals managed by the trust. It is also seen as a forerunner for further financial difficulties for many other healthcare trusts arising from the PFI-financed hospitals. It is indicative of the dangers of public partnerships which are costly, inflexible and disguise the financial implications of infrastructure investment.

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Spotlight G-20: Grain Reserves and the Food Price Crisis

Sophia Murphy, guest blogger

With the U.S. government announcement last week that this year’s corn crop is expected to be much smaller due to an extended drought, agricultural commodity markets are yet again headed for high and unstable prices this summer. Is the world better prepared for the shortfall then it was in 2007? Certainly, the United States is not. To cite agricultural journalist Alan Guebert:

Indeed, according to CCC (Commodity Credit Corporation), there is not one teaspoon of sugar, one pound of peanuts, one slice of butter, one wheel of cheese, one bushel of wheat or even one chickpea in USDA’s pantry. CCC has nothing—nada, zip, goose egg—to release into the marketplace to slow or moderate what’s certain to be fast-climbing food prices in the coming months.

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Spotlight G-20: Grain Reserves and the Food Price Crisis

Sophia Murphy, guest blogger

With the U.S. government announcement last week that this year’s corn crop is expected to be much smaller due to an extended drought, agricultural commodity markets are yet again headed for high and unstable prices this summer. Is the world better prepared for the shortfall then it was in 2007? Certainly, the United States is not. To cite agricultural journalist Alan Guebert:

Indeed, according to CCC (Commodity Credit Corporation), there is not one teaspoon of sugar, one pound of peanuts, one slice of butter, one wheel of cheese, one bushel of wheat or even one chickpea in USDA’s pantry. CCC has nothing—nada, zip, goose egg—to release into the marketplace to slow or moderate what’s certain to be fast-climbing food prices in the coming months.

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New blow to banking system

Martin Khor

The still-developing LIBOR scandal is the latest and biggest blow to the credibility of big banks and their regulators, and should catalyse broad-ranging reforms to the financial system.

The reputation and credibility of banks, regulators and the banking system in Western developed countries, already battered by the twists and turns of the financial crises, have reached new lows with the LIBOR scandal, which is still evolving and will yet reveal more wrong-doing.
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Spotlight Rio+20: Sustainable Development As An Answer To Economic And Financial Crises

Below is the speech delivered by Dr Yılmaz Akyüz, Chief Economist of the South Centre on the Sustainable Development Dialogue Roundtable on the Global Financial Crisis, UN Conference on Sustainable Development 2012, in Rio de Janeiro on 16 June 2012.

As seen over and again during recurrent financial crises in both developing and advanced economies (DEs and AEs), including the recent global crisis originating in the US and Europe, financial instability and boom-bust cycles undermine all three ingredients of sustainable development – economic development, social development and environmental protection.

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Spotlight G-20 & Rio+20: Challenges of sustainable development: beyond the G20 and Rio +20 Summits

Alejandro Chanona, guest blogger

The 1992 Rio Declaration identifies the “right to development” as the synthesis of existing human rights, such as the right to a proper life, to higher levels of health, education, housing, job and food. However, there is a big gap between states’ discourse in support of sustainable development and the well-being of the individual and the actions and commitments needed to achieve them.

The fundamental problem is that, since 1992, there was an attempt to implement an ideal model of development (sustainable development) without changing the dominant economic paradigm. Quite to the contrary: that paradigm became more deeply entrenched. The redefinition of global development since the 1987 Brundtland Report and the 1992 Earth Summit, which is the context for the Millennium Goals, coincided with the most speculative handling of the economy and its securitization, creating a contradiction that persists until today.

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Spotlight G-20 & Rio+20: Challenges of sustainable development: beyond the G20 and Rio +20 Summits

Alejandro Chanona, guest blogger

The 1992 Rio Declaration identifies the “right to development” as the synthesis of existing human rights, such as the right to a proper life, to higher levels of health, education, housing, job and food. However, there is a big gap between states’ discourse in support of sustainable development and the well-being of the individual and the actions and commitments needed to achieve them.

The fundamental problem is that, since 1992, there was an attempt to implement an ideal model of development (sustainable development) without changing the dominant economic paradigm. Quite to the contrary: that paradigm became more deeply entrenched. The redefinition of global development since the 1987 Brundtland Report and the 1992 Earth Summit, which is the context for the Millennium Goals, coincided with the most speculative handling of the economy and its securitization, creating a contradiction that persists until today.

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Spain: Shaken by crisis

Jayati Ghosh

Barcelona is an extraordinary city. It is obviously memorable for its fantastic architecture, dominated by the impressive, quirky, imaginative and joyful creations of Antonio Gaudi and other architects of the ”modernista” tradition of the early 20th century. It was home to some of the most interesting artistic innovators of the twentieth century – from the artists Picasso and Joan Miro to the musicians Isaac Albeniz and Enrique Granados. It has amazing food, in which the glories of being near to the sea are adequately reflected, and it is clear that in this city the manifold pleasures of eating and drinking are fully appreciated and indulged in.

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What type of growth and austerity, that is the question

Roberto Sansón Mizrahi, guest blogger

Since the outbreak of the crisis, false choices have been imposed on us. First, we were led to believe that we must bail out large, troubled financial institutions using public resources or let the world collapse, such as happened in 1930.  Then, when the crisis spread throughout Europe, the decision was to deal with fiscal deficits and sovereign over-indebtedness by imposing brutal adjustments that affected large majorities; otherwise, the collapse would sweep the European Union and the euro.

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