The world did not end this year, as some people thought it would following a Mayan prophecy (well, at least one interpretation of it), but it seems pretty certain that next year is going to be tougher than this one.• We are entering 2013 as the Republican hardliners in the United States Congress does its utmost to weaken the federal government, using an anachronistic law on federal debt ceiling. Until the Republicans started abusing it recently, the law had been defunct in all but name. Since its enactment in 1917, the ceiling has been raised nearly a hundred times, as a ceiling set in nominal monetary terms becomes quickly obsolete in an ever-growing economy with inflation (…)
• Meanwhile, on the other side of the Atlantic, the eurozone is entering a make or break year, with the social fabric of the periphery countries stretched to the limit. With its GDP 20% lower than in 2008, with 25% unemployment rate and with the wages of most of those still in work down by 40% to 50%, it is a real touch and go whether the current Greek government can survive another round of austerity. (…)
• As for the UK, 2013 may become the year when it sets a dubious world record of having an unprecedented “triple-dip recession”. Even if that is avoided, with high unemployment, real wages that are at best stagnant and swingeing welfare cuts, many people will struggle to make ends meet (…)
• Things look brighter in the Asian countries, with their economies growing much faster and with even Japan ready to make a dash for growth through more relaxed monetary and fiscal policies. However, they – especially the two giants of China and India – have their own shares of social tension to manage.
• Growth is slowing down in China. It is estimated to have grown by 7.5% in 2012, well below the usual rate of 9% to 10%. Some forecast that its growth rate will pick up again to above 8% in 2013, but others believe it will fall below 7%. Given the country’s heavy reliance on exports to the US and the European Union, the more pessimistic scenario seems likely, as things don’t look very good in those economies. With slower economic growth it will become more difficult to manage the social tension that has been bubbling up thanks to runaway inequality and high levels of corruption.
• Management of social tension will be an even bigger challenge for India. Its economic growth has significantly slowed down since 2010, and few predict a major reversal of the trend in 2013. Add to this economic difficulty deepening economic, religious and cultural divisions, and you have a heady mixture, as we see in the social unrest following the recent gang rape and death of a young medical student.
Illustration: Andrzej Krauze
Evil Teabagger: Free Markets are Best Markets
I’m not going to comment on Ron Paul’s ideology or EvilTeaBagger’s (probably) superb knowledge of research funding but I will provide a few figures from Avert [source],
- In 2008, an estimated $15.6 billion was spent on HIV/AIDS compared to $300 million in 1996.
- Around half of total global funding disbursed in 2009 for the AIDS epidemic was provided by donor governments.
- The American government donates a substantial amount of money for the AIDS epidemic. In 2009 the United States was the largest donor in the world, accounting for more than half of disbursements by governments.
- Overall, the private sector is by far the smallest of the four main sources of funding for the global AIDS response, accounting for around 4 percent of spending.
Even the most generous private donor, the Bill & Melinda Gates foundation, isn’t free of flaws. [Source: The Lancet]
Evil Teabagger: Why Obama’s Stimulus Failed: A Case Study of Silver Spring, Maryland
How is this problematic? Is it because they used stimulus money? By the way, is this not the embodiment of a form or the forms of justifications needed relied upon by network capitalism? [Particularly in light of the 2008 financial crisis.]
Occupy Economics?
The perfect compliment to the NYT article I linked to yesterday, what’s going on with the C-word?
Concerns about the impact of growing economic inequality fit neatly into a larger critique of mainstream economic theory and its deep faith in the efficiency of markets.
Many unbelievers (including me) insist that we inhabit a global capitalist system rather than an efficient market. Willingness to use the C-word (capitalism) often signals concerns about a concentration of economic power that unfairly limits individual choices, undermines political democracy, generates financial and ecological crises and limits access to alternative economic ideas.
We can’t address these concerns effectively without a wider discussion of them.
Seventy Harvard students dramatized dissatisfaction with the economics profession when they walked out of Prof. Gregory Mankiw’s introductory economics class on Nov. 2, protesting, in an open letter to their instructor, that the course “espouses a specific — and limited — view of economics that we believe perpetuates problematic and inefficient systems of economic inequality in our society today.” (Professor Mankiw, a periodic contributor to the Economic View column in the Sunday Business section of The New York Times, discussed the protest in an interview with National Public Radio.)The event prompted online discussion of conservative bias in introductory economics textbooks, including an anti-Mankiw blog set up by Daniel MacDonald, a graduate student in my own department. Prof. John Davis of the University of Amsterdam and Marquette University posted a video arguing that economic researchers, like fish, engage in herd behavior in order to minimize individual risk.
Similar themes were explored at the recent meetings of the International Confederation of Associations for Pluralism in Economics, a forum for a remarkable variety of dissenting views deploying the C-word. I participated in a session discussing blogs maintained by David Ruccio of Notre Dame, Perry Mehrling of Barnard College, Tiago Mata of Duke University and Tim Wise of Tufts University, as well as an independent blogger, Peter Radford.
At the final plenary session of the conference, titled “Ethics and Economics,” participants discussed an “Economists’ Statement” in support of Occupy Wall Street that has been posted online at Econ4, a new site aimed at popular economics education. As of Nov. 27, the statement had gotten more than 220 signatures.
In other words, let’s talk about Capitalism again as some economists begin to unite with OWS under the “this sucks and we need to rethink some things” flag. Read The NYT blog post here.
h/t: @moorehn [tumblr here]
