The major point I was trying to make in my article was that the real improvements in poverty reduction, as well as in life expectancy and many other fields, do not depend wholly on economic policies, but also on the role of fossil fuels, and on scientific, medical and other advances, which, other things being equal, should accelerate in impact across time and space. Hence the fact that the rate of improvement is in the form of a curve, not a purely linear effect. These improvements have taken place under different economic systems, and are not a function of neoliberalism or “global markets”.
The assessment of the impact of the policies in the election manifestos in the media is rather static as comments mostly ignore their positive impacts on growth, investment and productivity. This policy brief on the Labour Party's manifesto brings the forgotten macroeconomic principles into this debate. The manifesto's economic policies can lead to higher private investment and productivity, and help to rebalance the economy.
Since 2010 the European Commission, the IMF and the Greek and European political establishment have imposed a full blown internal devaluation programme that in Greece has caused a depression unlike any seen in Europe since WWII. The main drivers of the programmes have been an exaggerated and cruel implementation of the neoliberal policy agenda, including cuts in wages and pensions, increases in taxation, the fire sale of public assets at fire prices and severe cuts in funding for an already underfunded health system.
Oxfam made the headlines today, on the eve of this year's Davos World Economic Forum, with their claim that the world we live in is becoming ever more economically unequal and unjust.
The proselytisers for financialised globalisation counter-claim that extreme poverty worldwide has never fallen so rapidly as in recent years. While there has been such a fall, which is very welcome, it has taken place over a longer period, and is due to longer-term changes.
Seasonal memories of Charles Dickens’ London lifted from A Christmas Carol somehow let us feel better about our selves. We look back on less enlightened times and see how far we’ve come. We know the redemptive moral journey to be taken by Ebeneezer Scrooge and how it will resolve itself. The story scares with tragic threat but is ultimately safe, because there’s nothing in modern Britain seriously to compare, is there?
Scrooge was, after all, just a zero hours contract employer who paid less than a living wage, peddled consumer debt, and believed that benefits should be cut regardless of the impact on a person’s life chances (some were better off dead he said).
I am exasperated by John Kay in the FT today. His column The capitalists sold the mills and bought all our futures, is superb and for that reason deeply annoying. Its really aggravating when someone can cogently express points that have gnawed away at one for weeks, and yet rendered one incoherently inchoate.
Thomas Piketty has now published his detailed reply (dated 28th May) to two withering attacks by Chris Giles, the Financial Times’ economics editor, on his data and use of data, in particular in relation to the proportion (over time) of wealth-ownership of the top 1% and 10%. On most points, Piketty has answered the points in a reasonable (and to me generally persuasive) way.
It is an old truism that politics and economics are inseparable, but these days we tend to accept the connection submissively, giving little serious thought to how the link could be used to improve our economic plight. This is a grave mistake, for we democratically elect our governments, and the thoroughly bad politics that underpins our economy is ultimately our responsibility.
We were struck this week by the news from Forbes magazine that there are now some 1,426 billionaires in this world of ours (or do we mean theirs?). We tweeted
"So USD 1,426,000,000,000 minimum. 1bn on 1USD a day = quarter of this”
Fair enough, we felt, to make the point that 1 person in 7 on planet earth lives off almost nothing whilst a tiny number of hyper-rich have “enclosed” the wealth created by the rest of us for their own benefit and delight. But we were conscious that in comparing wealth (of the billionaires) with income (of the poorest) we weren’t comparing like with like. So let’s now look at both wealth and income, making a few reasonable estimates.