Frank Ackerman, Richard Tol on Climate Policy: A Critical View of an Overview
Edward B. Barbier and Jacob P. Hochard, Land Degradation, Less Favored Lands, and the Rural Poor
C.P. Chandrasekhar and Jayati Ghosh, India’s High Technology Deficit
Gerald Epstein, Fed Chair Signals Possible Policy Shift on Unemployment
Robin Broad and John Cavanagh
On September 15, in a tribunal that few know exists, the fate of millions of people and hundreds of millions of dollars will be debated and decided in the next six months.
The tribunal is the World Bank Group’s International Centre for Settlement of Investment Disputes (ICSID). It sits in downtown Washington, D.C., behind security guards at the World Bank. At issue is the future of El Salvador, some 2,000 miles away, where a global mining company—Pacific Rim, now owned by Australian/Canadian corporation OceanaGold—wants to mine gold in ways that could well poison the river system serving over half the Salvadoran population.
The crime alleged by the mining company is that the government of El Salvador has not approved a mining license for it. But the real crime is that a foreign corporation is trying to stifle democracy in a country where a small landed oligarchy and U.S. intervention stifled it for so long.
Robin Broad and John Cavanagh
On September 15, in a tribunal that few know exists, the fate of millions of people and hundreds of millions of dollars will be debated and decided in the next six months.
The tribunal is the World Bank Group’s International Centre for Settlement of Investment Disputes (ICSID). It sits in downtown Washington, D.C., behind security guards at the World Bank. At issue is the future of El Salvador, some 2,000 miles away, where a global mining company—Pacific Rim, now owned by Australian/Canadian corporation OceanaGold—wants to mine gold in ways that could well poison the river system serving over half the Salvadoran population.
The crime alleged by the mining company is that the government of El Salvador has not approved a mining license for it. But the real crime is that a foreign corporation is trying to stifle democracy in a country where a small landed oligarchy and U.S. intervention stifled it for so long.
First, let me be absolutely clear. I do in general favor the current administration in Brazil, as much as other left of center governments in South America. But I do understand some of the critiques from the left (not the right wing conservatives that are against social spending and more redistribution of income). A good example of the limits to the current experience in the region are provided by the Brazilian case.
Recently a post (in Portuguese; full disclosure one of the authors is a friend) went viral in Brazil. It showed how much Brazil has grown during Lula/Dilma, from the Workers’ Party (PT, in Portuguese) compared to the rest of the world, and advanced economies, and the same exercise done for the Fernando Henrique Cardoso (FHC), from the Brazilian Social Democratic Party (PSDB in Portuguese) period.
First, let me be absolutely clear. I do in general favor the current administration in Brazil, as much as other left of center governments in South America. But I do understand some of the critiques from the left (not the right wing conservatives that are against social spending and more redistribution of income). A good example of the limits to the current experience in the region are provided by the Brazilian case.
Recently a post (in Portuguese; full disclosure one of the authors is a friend) went viral in Brazil. It showed how much Brazil has grown during Lula/Dilma, from the Workers’ Party (PT, in Portuguese) compared to the rest of the world, and advanced economies, and the same exercise done for the Fernando Henrique Cardoso (FHC), from the Brazilian Social Democratic Party (PSDB in Portuguese) period.
Two days ago, we learned that the Chinese government was behind the bailout earlier this year of a trust product—a type of financial product that the central government has heretofore emphatically distanced itself from. Huarong Asset Management, using a 3 billion RMB loan from the Industrial and Commercial Bank of China (ICBC), the trust product seller, was the mystery lender behind the January bailout of the Credit Equals Gold trust product, the Financial Times reported on August 31. ICBC and Huarong Asset Management are both state-owned entities.
This is a notable event that changes the way that analysts look at shadow banking financial products. Up until this point, there appeared to be a firewall between the traditional banking system and the shadow banking sector. The China Banking Regulatory Commission (CBRC) has sternly warned the financial sector that it would not bail out non-traditional loans or other assets. In keeping with this approach, many flagging financial products were indeed not bailed out by the central government, including trust products like those sold by Jilin Trust and CITIC Trust and, more recently, mutual fund products including those sold by Shanghai Goldstate Brilliance Asset Management and Mirae Asset Huachen Fund Management Co. The central government aimed to limit its implicit backing of the financial sector.
Now, however, as a result of the Huarong fund injection, we know that the implicit guarantee in practice runs deep, especially when financial products are sold via state-owned banks.
Two days ago, we learned that the Chinese government was behind the bailout earlier this year of a trust product—a type of financial product that the central government has heretofore emphatically distanced itself from. Huarong Asset Management, using a 3 billion RMB loan from the Industrial and Commercial Bank of China (ICBC), the trust product seller, was the mystery lender behind the January bailout of the Credit Equals Gold trust product, the Financial Times reported on August 31. ICBC and Huarong Asset Management are both state-owned entities.
This is a notable event that changes the way that analysts look at shadow banking financial products. Up until this point, there appeared to be a firewall between the traditional banking system and the shadow banking sector. The China Banking Regulatory Commission (CBRC) has sternly warned the financial sector that it would not bail out non-traditional loans or other assets. In keeping with this approach, many flagging financial products were indeed not bailed out by the central government, including trust products like those sold by Jilin Trust and CITIC Trust and, more recently, mutual fund products including those sold by Shanghai Goldstate Brilliance Asset Management and Mirae Asset Huachen Fund Management Co. The central government aimed to limit its implicit backing of the financial sector.
Now, however, as a result of the Huarong fund injection, we know that the implicit guarantee in practice runs deep, especially when financial products are sold via state-owned banks.
Advocates of neoliberalism not only dress themselves as market fundamentalists but also present themselves as anti-populist. They don’t dither when it comes to condemning any sign of the government using tax revenues to provide transfers or subsidies to the poor or undertake expenditures that are expressly meant to favour the poor, in the form of livelihood protection, poverty alleviation or free and universal provision of basic health and educational facilities. The justification for this is two-fold: that expenditure to support growth must be favoured over spending to directly improve welfare; and, that fiscal prudence must be privileged over all else when deciding the use of the exchequer’s resources. So if spending has to be tailored to correspond to revenues, expenditure on “populist” measures must be limited or abjured.
There is a twist in the arithmetic underlying such reasoning. It assumes that the difference between tax and non-tax revenues, on the one hand, and total expenditures, on the other, can be reduced only by reducing expenditures and not by increasing revenues. That is obviously not true. Comparisons of the share of GDP appropriated as taxes by the Centre alone or by the Centre and states in India with the corresponding figures in similarly placed or even poorer economies points to the substantial untapped revenue potential in the country. While this has been occasionally recognised in the budget speeches of Indian finance ministers, few are willing to impose significantly higher taxes on those with much-higher-than-average incomes or those appropriating a disproportionate share of the surpluses over necessary consumption in the system.
The unwillingness or “inability” of the State to tax the rich reveals that it is not a neutral agency standing above all classes. It is partisan and represents the interests of a few.
This is the fourth of a five-part series by regular Triple Crisis contributor Ali Kadri, Senior Research Fellow at the Middle East Institute, National University of Singapore, and author of Arab Development Denied: Dynamics of Accumulation by Wars of Encroachment (Anthem Press).
The series is based on an interview he granted to the Center for the Study of Human Rights at the London School of Economics (LSE). The full interview is available here.
Is “Arab socialism” viable? And if so, is it desirable?
One must critically analyse “Arab socialism” within its historical context. In times of immediate post-independence autonomy (the 1960s to the late 1970s), state dirigisme, high public investment rates, and more egalitarian redistribution characterised all Arab states. A particular set of Arab states followed the path of “Arab socialism”—they nationalised industry and finance and implemented agrarian reform as in Egypt, Iraq, Algeria, Libya, and Syria—which resulted in significant welfare gains. However, half-hearted Arab socialist egalitarian processes, initiated from the top down, excluded the working class from participating actively in defending their gains, deepened labour-process regimentation, suppressed autonomous labour representation, and exacted differential gains accrued to the state bourgeoisie via wage system exploitation.
On the opposite side of Arab socialism, in the monarchic Arab states—the Gulf, Morocco and Jordan—regime stability was ordained by the extension of U.S.-tailored security arrangements and the not-so-hidden fact that the monarchs practically owned national resources and managed redistribution solely for the purpose of stabilisation in relation to the U.S.’s anti-Soviet positioning. In Arab socialist states, which sided with the USSR, a colonially-weakened national bourgeoisie that was short on financing and cornered into commercial practices, could not deliver in terms of development. Moreover, its tainted reputation as a colonial subsidiary had not provided it with the necessary ideological support to govern. Single-party Arab socialist regimes rose to power and supplanted the rise of bourgeois democratic governments. The Arab socialist state, through populist appeal and the capacity to generate its own finance, acted as a surrogate industrial bourgeoisie in handling capital’s production and appropriation measures. The state rose as the principal owner of the means of production and appropriator/distributor of the social product. The private sector shrank but still absorbed a significant chunk of the labour force in artisanal and petty farming undertakings. State ownership existed side-by-side with a constrained private sector. In hindsight, it was inevitable that private sector expansion would recommence when the state bourgeois class required more economic space to grow and the political climate ripened for ‘free market’ policies and openness—as happened since the early 1980s, or more conclusively, in the early 1990s as the Soviet Union fell.
What should I eat now? Is there nothing that is safe?” This is what I am asked every time the Centre for Science and Environment (CSE) does a study on toxins in food. It is a fact that our food is becoming unhealthy—not because of deliberate adulteration but because we are choosing to produce it in unsafe ways. India is at the beginning of industrial food production focused on efficiency and profits, and not on consumer safety, so it still has a choice to get it right. Why should the country not exercise its right to food that secures livelihoods and nutrition?
This time CSE has looked at antibiotics in chicken. Its laboratory bought 70 samples of chicken from different markets across the National Capital Region. It analysed each animal for six antibiotics: oxytetracycline, chlortetracycline and doxycycline (class tetracyclines);enrofloxacin and ciprofloxacin (class fluoroquinolones) and neomycin, an aminoglycoside. All these antibiotics are critical for humans. These are the same medicines we are prescribed when we are taken ill. These are life-saving drugs.
Today we know antibiotic resistance is almost a health pandemic. It is said that humans are headed towards a post-antibiotic era, where these miracle medicines will not work. No new class of antibiotics has been discovered for the past 20-odd years, so what we have is what we should keep for critical treatment. It is well known that resistance is growing because of our overexposure to antibiotics. A drug is no longer effective for treatment when microbes become resistant to it.
But we do not realise that our overexposure to antibiotics is also growing because of the food we eat.