The debate over the Green Economy rages on next month in Rio de Janeiro, at the International Society for Ecological Economics meetings, the Cupulo dos Povos alternative people’s summit, and the UN’s Rio+20 Earth Summit. Proponents and critics of ‘green growth’ capitalism will butt heads using narratives about valuations of nature and the efficacy of markets.
Standing up to Jamie Dimon: Is it SAFE?
Jamie Dimon’s bravado railing against financial reform has morphed into contrition and a heavy diet of humble pie. After reportedly referring to Paul Volcker’s support of the “Volcker Rule” ban on risky proprietary trading and Federal Reserve Bank of Dallas’ President Richard W. Fisher’s support for downsizing the nation’s biggest banks as “infantile” and “nonfactual”, Dimon, President of JP Morgan-Chase is now admitting “egregious mistakes” as his bank reports a minimum of $2 billion in losses on risky trades that just a few weeks ago he defended against press reports which he called a “tempest in a teapot.”
A Policy for Industry
India needs to draw up a coherent industrial strategy by learning from developing countries that have successfully employed industrial policies.
A PANEL discussion in Doha, Qatar, as part of the 13th United Nations Conference on Trade and Development (UNCTAD XIII) brought together some economists and policymakers to provide new perspectives on industrial policies in the South. It became evident that industrial policies have been significant, if unsung, forces behind the much-trumpeted “emergence” of some developing economies as major players on the world stage.
The Path to a Stronger Democracy Lies in Strengthening Community
Two new books examine how putting capitalism before community has distorted the economy and put democracy at risk.
I participated in a panel discussion last week to help launch The Occupy Handbook, in which I and about 60 others made contributions. It was mostly composed of economists and mainstream journalists, and the focus was income inequality. One wouldn’t expect anything much different from a discussion of Occupy Wall Street, which after all made “the 1 percent” a household tag line for what is unfair about the American economy. Read the rest of this entry »
Pollution: The Great Leveller
A harried parent called a few weeks ago. She wanted to know if the pollution levels in Delhi were bad and if so how bad. The answer was simple and obvious. But why do you need to know? Her daughter’s prestigious school (which I will leave unnamed) had sent a circular to parents, saying they are planning to shift to air-conditioned buses because they were worried about air pollution. She wanted to know if this was the right decision.
My answer changed. The fact is that pollution levels are high and we do need to find ways to bring them under control. But the solution is not to think that the rich can find ways to avoid breathing the air, and so keep pollution at bay. I asked her if the school was also planning to build an air-conditioned funnel for walkways and an air-conditioned gymnasium so that children would not be exposed to this foul air. Read the rest of this entry »
The Wealth of Nations and the Poverty of Economics
The new book (and the accompanying blog) by Daron Acemoglu and James Robinson Why Nations Fails is a popular version of their academic papers (several with Simon Johnson, the ex IMF chief economist) on the topic [read a brief summary here]. The main idea is that institutions and not geography or culture are the key to economic development. That is for the most part true.
They use South and North Korea (and Nogales, México and Arizona) as an example of countries that share the same culture and geography, but have very different institutions, and, as a result, a huge disparity in income per capita. Jared Diamond is correct to point out that, in part, technology is geographically determined. No plants and animals to domesticate, and provide for a large surplus (Diamond uses the old classical notion of surplus), and higher population density (with the diseases and immunities associated to those Germs) and no advantages associated to a more developed division of labor (Diamond is also Smithian in that sense), with the consequent development of technology (Guns and Steel). But the problem is that this won’t help you understand why England and not China industrialized (the opposite extremes of the Eurasian continent). Read the rest of this entry »
UNCTAD gets fresh mandate
A fresh mandate has been given to the UN Conference on Trade and Development (UNCTAD) to continue the scope of its present activities as well as to take on some new issues in the next four years.
This was the main result of UNCTAD’s ministerial conference (known as UNCTAD XIII) that ended in Doha, Qatar, on Thursday.
It came after a huge battle between developing and developed countries that went on for several months, first in Geneva (where the UN organisation is located) and then in Doha.
Principles for Prevention of Sovereign Debt Crises – A historical opportunity
At the recently concluded UNCTAD XIII Conference in Doha, Qatar, a High-Level Roundtable on Debt Prevention and Management was held to discuss new Principles on Responsible Lending and Borrowing, which have been under discussion since 2009. The Principles are forward-looking and symmetrically cover issues on the lender and borrower sides; and they are comprehensive, in contrast to other existing ad hoc single-issue-focused initiatives; they take a soft-law approach with a view to build consensus. Most importantly, these Principles emphasize full information disclosure by lenders and borrowers as a means of enforcing accountability and discipline in lending and borrowing.
Economists, Liquidity Mongers and the Banker Assault on Financial Reform
This has been a bad stretch for advocates of financial reform – and therefore for the economy as a whole. One after the other, new financial regulations contained in the Dodd-Frank law are being gutted or delayed by regulators and Congress, while the bankers – escorted by a phalanx of paid economists, lawyers and lobbyists – are squealing “wee, wee, wee” all the way home.
Bankers and their lobbyists and economists help grease the skids not just with money – but with terms of “econ-speak” such as “cost-benefit analysis”, and most commonly, “liquidity”. Used and manipulated by the wrong hands, such boring and innocuous sounding concepts can turn dangerous, even fatal in the banker battle against safer financial regulation.
Latin America: On the road to neo-extractivism?
Last week Argentina’s president Cristina Kirchner nationalized 51% of the Spanish (majority) owned oil company Repsol-YPF. Madrid threatened reprisals but Kirchner reaffirmed her decision with nationalistic undertones. Many in Latin America saw the Argentinean resolve as an example of the region’s quest to recover control over its natural resources.
Progressive movements interpreted this act as proof that winds of change in Latin America are definitely moving away from the dark history of neoliberalism. But one question remains in the horizon: is Latin America returning to a form of extractivism?
Extractivism represents the time of enclaves, appalling social and labor conditions and the submission of central governments to the power of big international firms. It epitomizes the unfair and asymmetric integration of Latin America to the world economy at the end of the 19th century. The import substitution development strategy implemented between 1940 and 1978 was designed to escape from this trap. The debt crisis detonated in 1982 and the neoliberal policy package implemented in many countries in the region destroyed the industrial tissue built during the import substitution strategy.