Wednesday, February 15, 2017

Beyond Resistance: How Democrats Can Win Back Working Families [feedly]

Beyond Resistance: How Democrats Can Win Back Working Families
http://prospect.org/article/beyond-resistance-how-democrats-can-win-back-working-families

Supporters of paid family leave hold signs at a rally in New York City on March 10, 2016.

The throngs of protesters who attended the Women's March on Washington, and who continue to demonstrate at airports, town halls, and on city streets around the country, have made clear that opposition to Donald Trump's radical Republican agenda will be sustained and powerful. But to earn the trust of the majority of Americans who reject Trumpism, Democrats will have to go beyond simple resistance. They'll have to show that if voters restore them to power, they'll actually improve the lives of working families.

Democrats have some work to do. Take, for example, Muriel Bowser, the Democratic mayor of Washington, D.C.—in theory, at least, the heart of the resistance. For two years, Bowser failed to support local legislation to create the nation's strongest paid family and medical leave program. The D.C. Council passed the bill anyway, mustering a super-majority in the face of Bowser's—and corporate D.C.'s—objections to both the program's costs, and to the government's role in administering it. But Bowser's opposition to a policy supported by a bipartisan majority of voters demonstrates precisely the kind of tone-deafness that will keep Democrats in the minority. Now more than ever, Democrats must give struggling families a reason to believe in government as a force for good in their lives. A rejection of paid family and medical leave policies in D.C. does just the opposite.
Because of the Democratic party's historic losses around the country last year, the Democrats in the best position to restore faith in party leadership are those few who remain in power—mostly mayors, governors, and state legislative majorities. Trump's campaign played on racial demagoguery that reached far beyond the white supremacist "Bannon wing" of the GOP base by blaming widespread economic insecurity on the racial "other." Step one of the resistance is rejecting Trump's racial scapegoating. But step two is delivering real relief to working families who might otherwise be vulnerable to Trump's far-right populist appeals.

At a time when so many Americans are struggling to make ends meet, Democrats must aggressively brainstorm and promote the solutions that working families are begging for. Paid family leave should be central to this platform, as should minimum-wage increases, like the $15 minimum wage law that has drawn wide praise in the District. These are vital tools to reduce the economic inequality and racial health disparities that are all too prevalent in major American cities—and they go hand in hand. Notably, the District's new paid leave policy will guarantee the city's lowest-income workers 90 percent of their wages while on family leave. This will be particularly helpful to working parents with newborn children, who are in a vulnerable spot. Our research has shown that two-parent families with young children experience a 14 percent drop in income compared to households without children. For single mothers, the drop is even more dramatic, at 36 percent. D.C.'s paid family leave policy will provide concrete support to families trapped between the need to care for their children and the necessity to earn a living wage. 

Such benefits are especially crucial now that Republicans are working every day to destroy the social safety net, including the Affordable Care Act, and are slashing federal support for cities and states. Democrats fighting to protect struggling families must do more than win rhetorical arguments. Where they can, they must enact concrete policies in the form of better pay and family-supporting benefits, affordable college, and programs to send young people to work instead of to jail.
At a time when Republicans and corporate lobbyists are peddling "alternative facts," Democrats serious about resisting Trumpism and winning more elections must boldly own these actual facts: Higher wages boost economies; paid leave makes for stronger families and better workers; universal health care is a social good; immigrants are vital members of our communities; and diversity and inclusion are what really make America great. To regain voters' trust, Democrats must counter Trump's right-wing, xenophobic, false populism with a family-friendly populism of their own—one that tangibly lifts up the dignity and financial well-being of all working people. 

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Trumka: The Senate Should Vote 'No' on Andrew Puzder [feedly]

Trumka: The Senate Should Vote 'No' on Andrew Puzder
http://www.aflcio.org/Blog/Political-Action-Legislation/Trumka-The-Senate-Should-Vote-No-on-Andrew-Puzder

In a new video, AFL-CIO President Richard Trumka lays out the reasons why Andrew Puzder, the fast-food CEO nominated to run the Department of Labor, is a bad pick for working families. Watch the video and then contact your senators and ask them to vote "no" on Puzder.

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China Completed $1.15 Trillion Investment in Major Projects in 2016 [feedly]

China Completed $1.15 Trillion Investment in Major Projects in 2016
http://www.nytimes.com/reuters/2017/02/14/business/14reuters-china-economy-investment.html


China completed 7.92 trillion yuan worth of investment in major projects last year, the state planner said on Wednesday.

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Tuesday, February 14, 2017

Book Review: State Capitalism: How the Return of Statism is Transforming the World [feedly]

Book Review: State Capitalism: How the Return of Statism is Transforming the World
http://www.globalpolicyjournal.com/blog/14/02/2017/book-review-state-capitalism-how-return-statism-transforming-world

State Capitalism: How the Return of Statism is Transforming the World by Joshua Kurlantzick. New York: Oxford University Press, 2016. 287pp, £19.99 hardcover 9780199385706

This is a very important book. Joshua Kurlantzick analyses one of the most important contemporary changes in the global economy – the rise of state capitalism in the developing world. A large set of countries is covered, ranging from the prototype of contemporary state capitalism, China, to lesser known exponents such as Malaysia, Brazil and Egypt. He thereby presents especially the rise of innovative forms of state capitalism as a more than formidable challenge to Western businesses and policymakers.

With the help of secondary research and case studies, Kurlantzick forcefully argues that state intervention in the developing world has increased in the recent past. Notably, countries as diverse as Brazil, Egypt, Indonesia, Vietnam, the UAE, Russia, Venezuela and Singapore are not returning to the failures of autarky and older versions of import substitution, but rather combine a high degree of state control of key companies with a degree of openness to the world economy, as long as that does not threaten state control over key industrial sectors.

Moreover, state capitalism has many varieties. Against accepted wisdom, 21st Century state capitalism "is better understood as a continuum" (p.7). It employs a wide variety of state control for instance: from wholly owned state firms to minority shareholding, from effective new ways of public-private collaboration between various state and domestic business coalitions to rather inefficient and corrupt practices.

Two distinctions are crucial according to the author: First, state capitalism differs in terms of the political system. Some such as Saudi Arabia, Iran, China, and Russia are autocratic, some are democratic (Brazil or India) and some lie in between (Singapore or Malaysia). Kurlantzick thereby de-links the two notions of autocratic rule and state capitalism and uses examples from Brazil and Indonesia to debunk the myth that state capitalism is naturally linked to autocracy.

Second, state capitalism differs in terms of economic performance, with very effective economies such as Singapore leading, followed by less effective (China or Indonesia) and least effective economies such as Egypt, Kazakhstan and Iran. This implies that the skepticism in the West about the long-term success potential of state capitalism is misplaced. Indeed, Kurlantzick finds evidence for the innovative potential of types of state capitalism that use state power to successfully promote critical, targeted sectors of their economies. Typically, he sees this happening in semi-autocratic regimes. If they find ways to also respond to their publics to some degree, they can both prosper economically and stabilize politically.

Kurlantzick then lays out five threats state capitalism represents to the global order: state capitalism can corrode emerging democracies; it can create political instability; ineffective state capitalism in places such as Russia or Malaysia can lead to economic collapses with global impact; innovative state capitalisms could become an attractive model for other countries, and especially autocratic state capitalists such as Russia and China will use their companies as "weapons of war". Here, some weaknesses of the book with regard to its more general perspective come to the fore: the author tends to draw a too stark contrast (indeed a dichotomy) between state capitalism and free-market economies. While not unsurprising for a book so close to policy-making – Kurlantzick devotes a long chapter to policy advice (including the reasonable idea of separating democracy promotion from promoting economic liberalization) – this leads to one-sided analysis, dangerously close at times to undifferentiated notions of "bad" state capitalism and "good" free-market economies, so prevalent still in Western public discourse. Indeed, one very important fact thereby tends to be completely neglected throughout the book: divisions between state capitalisms, exemplified by conflicts between Iran and Saudi Arabia or latent conflicts between China and India.

Certainly, state capitalisms can create all kinds of "threats" to the global order. But is it not imaginable that liberal capitalism could corrode democracy as well, exemplified by recent developments in the European Union? Could free-market economies not generate political instability and economic collapses (as in Greece lately)? Even though the state-controlled natural gas giant Gazprom has been utilized as a "weapon" against other states, are we not witness to collusion between governments and large firms in the West as well, close to weaponizing economic power?

In other words, when assuming that the trend towards state capitalism mostly is a non-Western development (the exception being Norway), the danger of neglecting important phenomena emerges. While the author acknowledges the role of the global slump in fostering the return of the state in the South for example, he does not adequately deal with the fact that some "state capitalist" consequences of economic instability have approached Western economies too. The new Trump government may just be the latest example of this. Insights from Comparative Political Economy are important here. These emphasize that the world economy seems to be able to impose its general imperatives, if not to the same degree, on all of its components, despite different historical modes of regulation. If the global capitalist system is made up of a network of capitalisms, differentiated along national and regional lines but linked and undergoing permanent processes of differentiation and adaptation, to draw such a dichotomy is not very plausible. Perhaps the book's very good idea of understanding state capitalism as a continuum should hence be broadened, by including different varieties of Western capitalism as well.

In his new book, Kurlantzick gives the reader a superb analysis of recent changes in the developing world. With the help of a differentiated analysis, he thereby debunks myths about state capitalism – the key merit of this study in my view. At the same time, his nuanced analysis does not prevent him at times from drawing a too stark contrast between state capitalism and (what in fact are rather Western ideals of) free-market capitalism and democracy. But even though one might not agree with all of its arguments, the book makes a major contribution to the critical discussion of state capitalism with insights of great value for anyone interested in Economics, Comparative Political Economy and International Relations.

 

 

Tobias ten Brink is Professor of Chinese Society and Business at Jacobs University, Bremen. He recently published (with A. Nölke, C. May, S. Claar) an article exploring the rise of state-permeated capitalisms in large emerging economies.


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Piketty: On inequality in China [feedly]

On inequality in China

Thomas Piketty


http://economistsview.typepad.com/economistsview/2017/02/on-inequality-in-china.html

With Trump and Brexit, the Western-type democratic model is under fire. The Chinese media are having a field day. In column after column, the Global Times (official daily newspaper) condemns the explosive cocktail of nationalism, xenophobia, separatism, TV-reality, vulgarity and 'money reigns supreme', the outcome of the so-called free elections and the wonderful political institutions which the West would like to impose on the world. No more lessons!

Recently the Chinese authorities organised an international colloquium on 'The Role of Political Parties in Global Economic Governance'. The message sent to the colloquium by the Chinese Communist Party (CCP) was perfectly clear. Reliance on solid intermediary institutions such as the CCP (which includes 90 million members, or roughly 10% of the adult population, almost as much as the turnout in the American or French presidential primaries) enables the organisation of discussions and decision-making and the design of a stable and harmonious development model, in which identity conflicts and the centrifugal forces brought by the electoral supermarket can be overcome.

By so doing, the Chinese regime may well be over-confident. The limits of the model are well known, beginning with the total lack of transparency and the ferocious repression suffered by all those who condemn the opacity of the regime.

According to the official statistics, China is still a passably egalitarian country in which the benefits of economic growth are fairly distributed. In fact this is far from certain as we see from the findings of a recent study carried out with Li Yang and Gabriel Zucman (available on line on WID.world). By combining unpublished sources, in particular by checking fiscal and wealth data against national accounts and surveys, we show that the official data considerably underestimates the level of inequality in China and its evolution.

Between 1978 and 2015, it is undeniable that growth in China enabled the country to emerge from poverty. The country's share of global GDP rose from just under 4% in 1978 to 18% in 2015 (whereas its share in world population declined slightly, falling from 22% to 19%). Expressed in terms of parity of purchasing power and in 2015 Euros, per capita national income rose from barely 150 Euros per month in 1978 to almost 1000 Euros per month in 2015. While the average income in the country remains between 3 and 4 times lower than in Europe or in North America, the richest 10% of the Chinese population – or some 130 million persons all the same – do have an average disposable income equivalent to that of the rich countries.

The problem is that the growth in income of the poorest 50% of the Chinese population has only been half the average. According to our estimates, which must be considered as lower bound levels of inequality in China, the share of the poorest 50% in the national income in China fell from 28% to 15% between 1978 and 2015, while the income of the 10% richest rose from 26% to 41%. The extent of the phenomenon is impressive: the levels of inequality in China are clearly higher than in Europe and are rapidly approaching those observed in the United States.

We find the same evolution, but even more dramatically, for the concentration of private property. Between 1995 and 2015 the share of private wealth held by the richest 10% rose from 41% to 67%. In 20 years, China has gone from a level lower than that observed in Sweden to a level approaching that of the United States. This conveys strong inequality in the access to property wealth (almost entirely privatised during this period) and a process of partial privatisation of companies, reserved for small groups of people in extremely opaque conditions. At this pace, China runs the risk of developing a form of pluto-communism, with a stronger concentration of private property than in capitalist countries, all guaranteed by a single Communist party.

We should however stress a fundamental difference. The share of the Chinese State in the national capital of China (property, companies, land, infrastructure and utilities) has dropped considerably but remains very substantial. According to our estimates, this share of public capital constituted 70% of national capital in 1978, and has stabilised around 30% since 2006, with even a slight rise since the crisis, the sign of a pick-up in public companies.

In the capitalist countries the share of public capital was in the range of 20-30% during the main period of the mixed economy (1950-1980), but this share has collapsed since 1980, as public assets were privatised and the debt was left to rise. In 2007, only Italy had negative public capital (with debts greater than assets). In 2015, this situation was found in the United States, the United Kingdom and Japan (France and Germany have barely positive net public capital). In other words, private property owners own not only the totality of national capital, but they also have drawing rights on future tax revenues.  This is a serious burden on the regulatory capacity of public authorities.

The position of the Chinese state is more promising, but only as long as the authorities show that this potential can be put at the service of the greatest number. The Chinese do not wish to be taught lessons by the West. Nor is it certain that they will listen to those of their supreme leaders for very much longer.


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EPIC Radio Podcasts:Janet Harrison features Jake Adam York on the Poetry Show

John Case has sent you a link to a blog:



Blog: EPIC Radio Podcasts
Post: Janet Harrison features Jake Adam York on the Poetry Show
Link: http://podcasts.enlightenradio.org/2017/02/janet-harrison-features-jake-adam-york.html

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EPIC Radio Podcasts:Fanny Crawford, Her Grandfather, Frederick Douglas, and Sojourner Truth Tell Their Stories

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Blog: EPIC Radio Podcasts
Post: Fanny Crawford, Her Grandfather, Frederick Douglas, and Sojourner Truth Tell Their Stories
Link: http://podcasts.enlightenradio.org/2017/02/fanny-crawford-her-grandfather.html

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