Regular Triple Crisis contributor James K. Boyce, director of the Program on Development, Peacebuilding, and the Environment at the Political Economy Research Institute (PERI) and Professor of Economics at the University of Massachusetts-Amherst, addresses a new “cap-and-dividend” climate bill before the United States congress. This interview originally appeared at The Real News Network. Prof. Boyce’s detailed views on climate policy appeared earlier, in five parts, on Triple Crisis and its sister publication Dollars & Sense. It is available in full here.
New Climate Bill Would "Shrink Government," Reward Taxpayers
Regular Triple Crisis contributor James K. Boyce, director of the Program on Development, Peacebuilding, and the Environment at the Political Economy Research Institute (PERI) and Professor of Economics at the University of Massachusetts-Amherst, addresses a new “cap-and-dividend” climate bill before the United States congress. This interview originally appeared at The Real News Network. Prof. Boyce’s detailed views on climate policy appeared earlier, in five parts, on Triple Crisis and its sister publication Dollars & Sense. It is available in full here.
China’s Government Land Exposé
A farmer works the land in Southern Guangxi Province. Source: Author.
China’s National Audit Office, under the direction of the cabinet, recently launched an audit to review funds from land sales obtained between 2008 and 2013. The audit is part of the government’s fight against corruption. Local governments have often used land sales to increase revenue, at times under dubious circumstances, taking land from farmers at extremely low prices and selling the land to developers for a tidy profit. The audit brings to light ongoing issues with local government revenue and rural land use rights.
Local governments receive a portion of value added and corporate taxes collected in their region, as well as all personal income and business taxes, but this has proven insufficient to generate a steady rate of GDP growth. In order to combat this problem, officials have used rural residents’ land both as a source of revenue and as collateral in taking out loans via local government financing vehicles. In this way, they have access to a major asset, unimproved land that promises to gain in value.
China's Government Land Exposé
A farmer works the land in Southern Guangxi Province. Source: Author.
China’s National Audit Office, under the direction of the cabinet, recently launched an audit to review funds from land sales obtained between 2008 and 2013. The audit is part of the government’s fight against corruption. Local governments have often used land sales to increase revenue, at times under dubious circumstances, taking land from farmers at extremely low prices and selling the land to developers for a tidy profit. The audit brings to light ongoing issues with local government revenue and rural land use rights.
Local governments receive a portion of value added and corporate taxes collected in their region, as well as all personal income and business taxes, but this has proven insufficient to generate a steady rate of GDP growth. In order to combat this problem, officials have used rural residents’ land both as a source of revenue and as collateral in taking out loans via local government financing vehicles. In this way, they have access to a major asset, unimproved land that promises to gain in value.
Banking with a Difference, Part II
This is the second in a two-part series on the New Development Bank (NDB) founded by the BRICS counties (Brazil, Russia, India, China and South Africa). The first part discussed the NDB’s potential to “shift power relations in the multilateral development-banking infrastructure.” This part considers some of the likely limitations on the changes the NDB will spur. The full article was first published as the H T Parekh Finance column in the Economic and Political Weekly.
The argument that the creation of the BRICS Bank could make a significant difference to the global financial architecture should not be pushed too far. In the final analysis development banks are instruments of state capitalist development. Such specialised institutions are needed because of the shortfalls in the availability of long-term finance for capital-intensive projects in market economies, resulting from the maturity and liquidity mismatches involved. Resources mobilised are from those wanting shorter maturities and greater liquidity, and sums lent are to projects that are large and illiquid with long gestations lags and long-term profit profiles.
In non-market economies, allocations for such investments can be made through the budget and financed with taxes or the surpluses generated by state-owned enterprises. If the instruments are state capitalist, they are unlikely to serve non- or anti-capitalist objectives that sacrifice private profit to deliver social benefit. So the best that can be expected of the NDB is that it would serve better the interests of capitalist development in the less developed countries (with some concern for sustainability and inclusiveness) than would multilateral banks that are dominated by and serve as instruments of the developed countries.
Savings, Capital Flight, and African Development, Part 2
This is the second of a two-part series on capital flight from Africa by regular Triple Crisis contributor Léonce Ndikumana. (Part 1 is available here.) The series is drawn from a Political Economy Research Institute (PERI) working paper, available here, forthcoming in Celestin Monga and Justin Y. Lin (eds.), Handbook of Africa and Economics, Oxford University Press.
Part 2: Fighting capital flight
Capital flight may be one of the causes of low domestic saving in African countries for a number of reasons. The first is a direct effect through allocation of private wealth in foreign assets as opposed to holding domestic assets. Capital flight also affects saving indirectly through its effects on domestic investment and growth. By depressing capital accumulation, growth is retarded as capital flight increases.
Fighting capital flight is, therefore, an essential element of the strategy to stimulate domestic saving in Africa. The discussion here is organized around two sets of strategies: incentive-based strategies, and institutions-based strategies for both fighting capital flight and stimulating domestic saving.
What Role for Development Finance in the Future of Africa and the Global South?
Francis A. Kornegay, Institute for Global Dialogue, associated with the University of South Africa, and Nancy Alexander, Heinrich Böll Foundation (North America)
At the recent BRICS Summit, leaders announced new initiatives, including a New Development Bank (NDB) for infrastructure and sustainable development. In the same timeframe, China will join with its allies to launch a new Asian Infrastructure Investment Bank (AIIB). These initiatives provide a counter-point to the U.S.-led World Bank and the Japan-led Asian Development Bank.
Not to be outdone, the World Bank aims to double its lending operations within the decade, including an expansion of infrastructure operations and the launch of a Global Infrastructure Facility (GIF) this year. While an initial GIF pilot program will be modestly funded, it has outsized ambitions for mobilizing global pension and sovereign wealth funds to invest in infrastructure as an “asset class.”
To some degree, the Group of 20 has instigated the expansion of infrastructure financing—ostensibly as a means to accelerate global growth and job creation. Bringing up the “caboose” of this infrastructure juggernaut, the UN declares that public-private partnerships (PPPs) will be a key “means of implementation” of its post-2015 agenda, including infrastructure.
The new-generation development finance institutions (NG-DFIs) are a testament to the failure of the Bretton Woods Institutions (BWIs) to reform their governance and share power with emerging economies. They also represent pushback against the BWIs’ legacy: imposition of neoliberal policies, including austerity regimes that strangled public spending on infrastructure; de-industrialization (e.g., demolished infant industries through premature trade liberalization); and dismantling of national development banks.
Deconstructing the Fed Vice Chair’s Grim Economic Forecast
Deconstructing the Fed Vice Chair's Grim Economic Forecast
Human Rights, the Global Economy, and the Arab World, Part 3
This is the third 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.
In your work you have argued that the Arab state is at the “behest” of foreign powers as regards resources. Please explain.
Development in a developing and class-divided society depends on the ruling class’s vested interest in capacity building. I also propose that, necessarily but not exclusively, the ruling class tendency to expand its wealth by its mode of integration with the global economy outweighs its nationalist or pan-Arab zeal. After the fact, the cant of Arab or pan-Arab nationalism has been the sentimental veneer behind which anti-integrationist policies have been implemented. Neither the country’s own working class nor the peoples of Arab nations have been integrated into a unifying wealth making process. In a word, the Arab ruling classes, as is the case of other ruling classes, place the concerns with which they accumulate first on their agenda. What has occurred in the Arab world under relentless imperialist assault is the gradual disengagement of national industrial capital (de-industrialisation), after which only commerce bereft of industrial production remained and the merchant mode of accumulation became the dominant mode around which society has come to be organised. So the class in charge no longer reproduces itself (creates the economic and social conditions for its expansion) from production in the national economy, but principally from grabbing national assets, divesting and expanding in the greater sphere of the international financial market.