Archive for the ‘Globalization & International Trade’ Category

30
Jul

Life in a Jobless World

Written on July 30, 2013 by Ángeles Figueroa-Alcorta in Culture & Society, Globalization & International Trade, Political Economy

Pleasure before Business

We shouldn’t worry about automation taking away our jobs – we should welcome it. If labor vanishes, we get to do the important things in life: self-chosen work and more real leisure!

By Guy Standing

Slow And Sure

Jobs are not disappearing. More people are in jobs than at any time in history. But the nature of jobs is changing – and many types of job are moving away from rich countries towards poorer ones. More of the available jobs are paying less. More are insecure, leading nowhere for those doing them.

Europe is not facing a jobs crisis due to automation. While technological advance, including automation, displaces some jobs, it creates others. Rather, the crisis is the result of a global transformation.

When neo-liberals wrested control of economic and social policymaking in the 1980s, liberalization policies opened up a global market system. Almost overnight, global labor supply trebled and more than a billion workers in China, India, and elsewhere started to be used in competition with workers in Europe and other rich countries.

As Europe made its labor markets more flexible – and more insecure for the new mass class, the precariat – there was downward pressure on wages, enterprise benefits and labor-based state benefits. Governments knew that liberalization would create greater inequalities and economic insecurity for millions relying on labor. Two courses were open.

They could have decided that those receiving income from profits and stock markets – the principal beneficiaries of liberalization – should share the gains with the rest of society. That would have prevented the emergence of a plutocracy of billionaires. Instead, governments made a Faustian bargain with their citizens. To disguise falling incomes, they financed an orgy of consumption with cheap credit, labor subsidies and tax credits. But in 2008 it ended, as every Faustian bargain must. Read more…

Guy Standing is Professor of Development Studies at the School of Oriental and African Studies in London.

As published by The European on July 28, 2013.

29
Jul

By Richard N. Haass

0af13a9e73dd91bb4ea10ed01bdfb606.portrait

Whenever something bad happens – Iran moving closer to acquiring nuclear weapons, North Korea firing another missile, civilian deaths reaching another grim milestone in Syria’s civil war, satellites revealing an alarming rate of polar-ice melt – some official or observer will call upon the international community to act. There is only one problem: there is no “international community.”

Part of the reason stems from the absence of any mechanism for “the world” to come together. The United Nations General Assembly comes closest, but little can be expected from an organization that equates the United States or China with, say, Fiji or Guinea-Bissau.

To be fair, those who founded the UN after World War II created the Security Council as the venue in which major powers would meet to determine the world’s fate. But even that has not worked out as planned, partly because the world of 2013 bears little resemblance to that of 1945. How else could one explain that Britain and France, but not Germany, Japan, or India, are permanent, veto-wielding members?

Alas, there is no agreement on how to update the Security Council. Efforts like the G-20 are welcome, but they lack authority and capacity, in addition to suffering from excessive size. The result is “multilateralism’s dilemma”:  the inclusion of more actors increases an organization’s legitimacy at the expense of its utility.

No amount of UN reform could make things fundamentally different. Today’s major powers do not agree on the rules that ought to govern the world, much less on the penalties for breaking them. Even where there is accord in principle, there is little agreement in practice. The result is a world that is messier and more dangerous than it should be.

Consider climate change. Burning fossil fuels is having a measurable impact on the earth’s temperature. But reducing carbon emissions has proved impossible, because such a commitment could constrain GDP growth (anathema to developed countries mired in economic malaise) and impede access to energy and electricity for billions of people in developing countries, which is unacceptable to China and India.

Stopping the spread of nuclear weapons would seem a more promising issue for global collaboration. The Nuclear Non-Proliferation Treaty (NPT) limits the right to possess nuclear weapons to the Security Council’s five permanent members, and then only temporarily. Read more…

Richard N. Haass, President of the Council on Foreign Relations, previously served as Director of Policy Planning for the US State Department, and was President George W. Bush’s special envoy to Northern Ireland and Coordinator for the Future of Afghanistan.

As published in www.project-syndicate.org on July 24, 2013.

26
Jul

By Ian Bremmer

RTX10RVA-1024x614

In 2008, before the financial crisis had even reached its nadir, Rahm Emanuel famously said: “You never want a serious crisis to go to waste.” Emanuel’s quote became the conventional wisdom for crisis management, even if the idea is age-old: John F. Kennedy Jr. famously pointed out that the Chinese word for “crisis” is composed of two characters, one for “danger” and one for “opportunity. 

Nearly five years after the global economic meltdown, we can now look at the world’s major powers and assess how well they’ve responded to their various crises. Three categories emerge. Who took advantage of crisis? Who never really had a true crisis? And who is letting crisis go to waste?

A crisis unwasted: Japan and the Euro zone

Let’s begin with Europe, which experienced a real and urgent crisis. Remember that as little as 18 months ago, the media and bond markets had the euro zone pegged for imminent fracture, when the debts of its member countries and the untenable divide between its core countries and those on the periphery threatened to overwhelm the political unity and economic cohesion that the bloc enjoyed. A lack of fiscal coordination, political and monetary dexterity, and balance between strong and weak states pushed the world’s largest economic bloc into existential crisis.

But with the help of Germany, bolder monetary policy from the European Central Bank, and some very painful budget-control measures, Europe has emerged on sounder footing, and the prospect of collapse is firmly behind it. There has been a fundamental restructuring, and now Europe is on the mend. The looming crisis itself helped affect structural change. Without market pressure and alarm bells, the periphery would not have been shaken from complacency, nor would the ECB have taken a bolder stance to put a floor under the crisis.

Japan had a very different crisis than Europe did. Two “lost decades” didn’t spur the Japanese into action. Japan went through nearly 20 years of stagnation, stuck in a whirlpool of deflationlow growth and rising public debt that prevented the country from competing as the rest of the world’s powers modernized their economic approaches. What shook Japan out of its malaise? In part, it was an increasingly acrimonious challenge from China, which has surpassed Japan to become the world’s second-largest economy. Japanese voters’ economic and security fears from the regional superpower prompted them to give Shinzo Abe another crack at the prime minister post. He’s used it to create an economic plan heavy on stimulus, join the Trans-Pacific Partnership trade pact negotiations, and work toward making all “three arrows” (monetary easing, government spending and structural reform) of his economic plan take flight. It’s still unclear whether Abe’s ambitious plans will succeed, but there is no question that Japan has converted its slow-motion crisis into a remarkable opportunity. Read more…

As published in www.reuters.com on July 25, 2013.

23
Jul

Until Snowden we lived in the illusion that the social networks gave us unlimited capacity for action

By José Ignacio Torreblanca, Associate Professor at IE School of International Relations

Torreblanca

Is the internet a tool of liberation or oppression? Until Edward Snowden came along we seem to have lived in the happy illusion that the internet and the social networks gave us an unlimited capacity for organization and action. The social networks, we were told, not only empowered us socially but also provided us with a potent political tool. Twitter and Facebook, together with Google’s capacity for disseminating an incredible volume of information in real time, had become a new weapon for citizen supervision of the government, and of resistance to tyranny. Like the press, radio and television before it, the internet now offered the citizen a way out from authoritarian monopolies on information. This is what we might call the horizontal or libertarian view of technology. And though sometimes exaggerated, as in the supposed revolutions of Tunisia and Egypt (which were far from such), this vision did foster a reasonable hope that technology and democracy might be solid allies.

But since Snowden we have had to concede greater weight to the other vision, that we might call authoritarian or vertical. Because, however much we suspected it — remember the Echelon revelations — we now know that while millions of citizens blithely use the internet and social networks, a number of states have the capacity for vertical control of the net and its content.

The US authorities’ line of defense is centered on, first, the claim that their listening capacity is confined to so-called metadata — that is, there is no scrutiny of content but only of flows; two, that there is only exceptional access, under strict judicial control, to the complete content, as is traditional in telephone taps; and three (not applicable to the rest of us), that the objects of such surveillance have never been US citizens within the United States.

But this sugar-coated version seems to have little truth to it. Snowden’s revelations to the magazine Cryptome note that intelligence service access to undersea cables carrying internet data allows it complete access to all the content traveling along them, the only problem being storage and processing capacity, which is now around 72 hours, after which they are erased. Keeping in mind the speed at which these things progress, it stands to reason that the 72-hour limit will soon stretch further. So that, if you know what you are looking for, access will be complete. Which covers everything to do with the individual in question: medical reports, the works. Read more…

As published in www.elpais.com on July 22, 2013.

19
Jul

By Fareed Zakaria

feature_2013-07-19-443x295

Does authoritarian capitalism work? For the past few decades, the Chinese economy’s meteoric rise, faster than any large economy in human history, has dazzled the world. It has made many wonder if China’s model of a pro-growth dictatorship is the best path for developing countries. Some have questioned whether Western democracies — with their dysfunctions and paralysis — can compete with China’s long-range planning. Now, as its growth slows to almost half its pace in 2007, the Chinese system faces its most significant test. The outcome will have huge economic consequences for the world and huge political consequences for China and its ruling Communist Party.

Over three decades, China’s growth has averaged 10 percent a year. Beijing managed that because it systematically opened up its economy to trade and investment while investing massively in infrastructure to facilitate manufacturing and exports. Crucially, China had the ability not to pander to its people to gain votes or approval. Unlike most developing nations, China spends little subsidizing current consumption (fuel and food, for example). It spends its money on export-free zones, highways, rail systems and airports. It is investing in education and soon will turn to health care. No developing democracy has been able to ignore short-term political pressures and execute a disciplined growth strategy with such success.

But the model is no longer working that well. Partly, this is the product of success. China has become the world’s second-largest economy; its per capita income is that of a middle-income country. It cannot grow at the pace it did when it was much poorer.

But growth has dropped faster and deeper than many had predicted. This month, the International Monetary Fund forecast China’s annual growth around 7.75 percent for the next two years. But it could slow further because, the truth is, China’s authoritarian system has made significant mistakes in recent years. Read more…

As published in www.washingtonpost.com on July 18, 2013.