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Paul Merrell

Americans on Wrong Side of Income Gap Run Out of Means to Cope - 0 views

www.moneynews.com/...544365

financial-collapse income inequality statistics Obama Boehner

shared by Paul Merrell on 02 Jan 14 - No Cached
  • “We’ve exhausted our coping mechanisms,” said Alan Krueger, an economics professor at Princeton University in New Jersey and former chairman of President Barack Obama’s Council of Economic Advisers. “They weren’t sustainable.” The result has been a downsizing of expectations. By almost two to one — 64 percent to 33 percent — Americans say the U.S. no longer offers everyone an equal chance to get ahead, according to the latest Bloomberg National Poll. The lack of faith is especially pronounced among those making less than $50,000 a year, with close to three-quarters in the Dec. 6-9 survey saying the economy is unfair.
  • The diminished expectations have implications for the economy. Workers are clinging to their jobs as prospects fade for higher-paying employment. Households are socking away more money and charging less on credit cards. And young adults are living with their parents longer rather than venturing out on their own. In the meantime, record-high stock prices are enriching wealthier Americans, exacerbating polarization and bringing income inequality to the political forefront. Even independent government agencies like the Securities and Exchange Commission and the Federal Reserve have been dragged into the debate.
  • “The basic bargain at the heart of our economy has frayed,” Obama said in a Dec. 4 speech in Washington. “This is the defining challenge of our time: Making sure our economy works for every working American.” Democratic lawmakers also intend to press next year for a higher minimum wage to tackle the yawning gap between rich and poor, Durbin said. Republicans aren’t ceding the issue. “The American dream is certainly more in doubt than in decades,” House Speaker John Boehner of Ohio said in response to Obama’s speech. “But after more than five years in office, the president has no one to blame but himself.”
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  • Income inequality has been rising more or less steadily since the mid-1970s. The Gini coefficient, a broad-based measure of inequality, stood at a record high last year, according to Census Bureau data dating back 46 years.
  • Women who became unemployed during the recession and its aftermath have been slower to find new positions. Among women losing jobs they’d held for at least three years between January 2009 and the end of 2011, 50 percent were re-employed by the start of 2012, while the share for men was 61 percent, according to a Bureau of Labor Statistics report released in February. Households turned to stepped-up borrowing to help make ends meet, until that avenue was shut off by the collapse of house prices. About 10.8 million homeowners still owed more money on their mortgages than their properties were worth in the third quarter, according to Seattle-based Zillow Inc. The fallout has made many Americans less inclined to take risks. The quits rate — the proportion of Americans in the workforce who voluntarily left their jobs — stood at 1.7 percent in October. While that’s up from 1.5 percent a year earlier, it’s below the 2.2 percent average for 2006, the year house prices started falling, government data show.
  • “The middle has really collapsed,” said Lawrence Katz, an economics professor at Harvard University in Cambridge, Massachusetts, and a former chief economist at the Labor Department in Washington. Even those with college degrees are having trouble keeping up, he said. While they earn more than those with less schooling, they’ve seen no real wage growth in recent years. The median income of men 25 years of age and older with a bachelor’s degree was $56,656 last year, 10 percent less than in 2007 after taking account of inflation, according to Census data.
  • It’s the richest of the rich who are reaping the most benefit as an increasingly interconnected and technologically sophisticated world puts a premium on those perceived to have the highest skills — a phenomenon dubbed “winner take all” by Cornell University Professor Robert Frank. Government policies also play a role. The Treasury Department, for instance, taxes capital gains racked up by the wealthy on the sale of shares, bonds and other assets at about half the rate of ordinary income. The top 1 percent captured 95 percent of the gains in incomes in the first three years of the recovery, based on analysis of tax returns by Saez. Those less well-off, meanwhile, are running out of ways to cope. The percentage of working-age women who are in the labor force steadily climbed from a post-World War II low of 32 percent to a peak of 60.3 percent in April 2000, fueling a jump in dual-income households and helping Americans deal with slow wage growth for a while. Since the recession ended, the workforce participation rate for women has been in decline, echoing a longer-running trend among men. November data showed 57 percent of women in the labor force and 69.4 percent of men.
  • The disparity has widened since the recovery began in mid-2009. The richest 10 percent of Americans earned a larger share of income last year than at any time since 1917, according to Emmanuel Saez, an economist at the University of California at Berkeley. Those in the top one-tenth of income distribution made at least $146,000 in 2012, almost 12 times what those in the bottom tenth made, Census Bureau data show. Economists have posited a variety of explanations for the growing differences in incomes. Manufacturing companies moved once high-paying jobs abroad, to China and elsewhere. Technological advances led to the loss of clerical and office work, especially relating to routine tasks. The decline of unions — 11.3 percent of workers were represented in 2012 compared with 20.1 percent in 1983 — has advantaged bosses at the expense of their employees.
  • Millennials — adults aged 18 to 32 — are still slow to set out on their own more than four years after the recession ended, according to an Oct. 18 report by the Pew Research Center in Washington. Just over one in three head their own households, close to a 38-year low set in 2010. Obama has proposed a raft of policies to attack the widening wage gap — from simplifying the tax code and increasing exports to enhancing worker training and boosting pre-kindergarten education. Yet in a divided Washington he hasn’t made much progress pushing them through. The president’s renewed focus on income inequality has more to do with politics than policy, said Douglas Holtz-Eakin, president of the American Action Forum, a self-described center- right institute in Washington.
  • “It’s great politics to demagogue income distribution and complain about the rich getting ahead and the poor falling behind,” said Holtz-Eakin, a former Congressional Budget Office director. “The substance of what he’s actually done doesn’t match the enormity of the problem as he’s portrayed it.”
  • The wage-gap debate has reverberated to other parts of Washington, as the SEC published a rule Sept. 18 that would compel public companies to reveal pay ratios between chief executives and their employees. While businesses have decried the requirement as overreach, some investors welcome the data as a way to help assess a company’s health.
  • Across companies in the S&P 500, the average multiple of CEO compensation to that of rank-and-file workers is 204, up 20 percent since 2009, according to data compiled by Bloomberg in April. The Fed also has been caught up in the debate over growing income disparities. Lawmakers from both parties have questioned whether its bond-buying policy, called quantitative easing, has benefited the rich at the expense of those less well-off by boosting prices of stocks and other assets.
  • The S&P 500 stock index has risen 29 percent in 2013. The richest third of U.S. households account for 89 percent of all equities ownership, according to the Center for Retirement Research at Boston College.
  • Janet Yellen, nominated to take over as Fed chairman next year, defended the central bank’s actions at a Senate Banking Committee hearing on Nov. 14. “The policies we’ve undertaken have been meant to generate a robust recovery,” Yellen told the committee. The growing calls for action to reduce income inequality have translated into a national push for a higher minimum wage. Fast-food workers in 100 cities took to the streets Dec. 5 to demand a $15 hourly salary.
  • Paul Merrell on 02 Jan 14
     
    Monetary policy of, by, and for banksters continues in the U.S. One irony is that banksters press for transition to an all digital currency so that savers can be penalized, a blatant "trickle-up"economic policy, whilst also pressing for more bank bailouts, wielding the thoroughly-discredited "trickle down" economic theory. But "trickle down" theory, in the context of bank bailouts, has not successfully trickled down and the only beneficiaries have been the few Americans who can still invest in the stock market, paying the highest dividends to the wealthiest among us. Has their ever been a time when the stock market's behavior has been so divorced from the well-being of the middle and lower economic classes? I doubt there has been at least in the last 50 years. Where would we be if the bank bail-out trillions had instead been mailed as checks to the middle and lower economic classes? "Trickle up" works and that is what built the American economy to its peak in inflation-adjusted dollars -- an affluent middle class. But do not expect leadership from Washington, D.C. in correcting income inquequality; only political rhetoric and a fight over extension of unemployment benefits, now lapsed. "According to the World Bank, the GINI coefficient "measures the extent to which the distribution of income or consumption expenditure among individuals households within an economy deviates from a perfectly equal distribution." Therefore it is used as an indication of income inequality within countries. ... In the late 2000s, Chile had the highest GINI coefficient, after taxes and transfers, among OECD member countries. The United States, Turkey and Mexico came right before it. At the other end of the scale, Slovenia, Denmark and Norway led the ranking with the lowest levels of income inequality." http://www.gfmag.com/tools/global-database/economic-data/11944-wealth-distribution-income-inequality.html#ixzz2pGpv4xGZ Higher minimum wages? How about instead abolishing the Feder
Paul Merrell

Top 1% Got 93% of Income Growth as Rich-Poor Gap Widened - Bloomberg - 0 views

www.bloomberg.com/...-as-rich-poor-gap-widened.html

economy election 2012 income gap

shared by Paul Merrell on 08 Oct 12 - No Cached
  • The earnings gap between rich and poor Americans was the widest in more than four decades in 2011, Census data show, surpassing income inequality previously reported in Uganda and Kazakhstan. The notion that each generation does better than the last -- one aspect of the American Dream -- has been challenged by evidence that average family incomes fell last decade for the first time since World War II.
Paul Merrell

Swiss in Forefront With Basic Income Proposal | Global Research - 0 views

www.globalresearch.ca/...5353952

financial-collapse income inequality income gap Switzerland EU

shared by Paul Merrell on 13 Oct 13 - No Cached
  • Within the European Union, a profound awakening of public consciousness is taking place as organizers seek to obtain one million signatures on a petition in favor of a basic income guarantee for all citizens. Under the EU constitution, this number of signatures is required for the proposal to undergo formal study and debate by the European parliament. In Switzerland, however, voters have seized the initiative through their own petition to have the Swiss government vote on a basic income guarantee of $2,500 Swiss francs per month, equivalent to $2,800 U.S. dollars.
  • Paul Merrell on 13 Oct 13
     
    Interesting response to the financial collapse and income equality. Compatible with the U.N. Declarationof Universal Human Rights, Art. 25: "(1) Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control." http://www.un.org/en/documents/udhr/index.shtml#a25
Paul Merrell

President Xi's speech to Davos in full | World Economic Forum - 0 views

www.weforum.org/...te-at-the-world-economic-forum

globalization China Xi Davos speech must-read

shared by Paul Merrell on 26 Jan 17 - No Cached
  • “It was the best of times, it was the worst of times.” These are the words used by the English writer Charles Dickens to describe the world after the Industrial Revolution. Today, we also live in a world of contradictions. On the one hand, with growing material wealth and advances in science and technology, human civilization has developed as never before. On the other hand, frequent regional conflicts, global challenges like terrorism and refugees, as well as poverty, unemployment and widening income gap have all added to the uncertainties of the world. Many people feel bewildered and wonder: What has gone wrong with the world? To answer this question, one must first track the source of the problem. Some blame economic globalization for the chaos in the world. Economic globalization was once viewed as the treasure cave found by Ali Baba in The Arabian Nights, but it has now become the Pandora’s box in the eyes of many. The international community finds itself in a heated debate on economic globalization.
  • Today, I wish to address the global economy in the context of economic globalization. The point I want to make is that many of the problems troubling the world are not caused by economic globalization. For instance, the refugee waves from the Middle East and North Africa in recent years have become a global concern. Several million people have been displaced, and some small children lost their lives while crossing the rough sea. This is indeed heartbreaking. It is war, conflict and regional turbulence that have created this problem, and its solution lies in making peace, promoting reconciliation and restoring stability. The international financial crisis is another example. It is not an inevitable outcome of economic globalization; rather, it is the consequence of excessive chase of profit by financial capital and grave failure of financial regulation. Just blaming economic globalization for the world’s problems is inconsistent with reality, and it will not help solve the problems.
  • But we should also recognize that economic globalization is a double-edged sword. When the global economy is under downward pressure, it is hard to make the cake of global economy bigger. It may even shrink, which will strain the relations between growth and distribution, between capital and labor, and between efficiency and equity. Both developed and developing countries have felt the punch. Voices against globalization have laid bare pitfalls in the process of economic globalization that we need to take seriously. As a line in an old Chinese poem goes, “Honey melons hang on bitter vines; sweet dates grow on thistles and thorns.” In a philosophical sense, nothing is perfect in the world. One would fail to see the full picture if he claims something is perfect because of its merits, or if he views something as useless just because of its defects. It is true that economic globalization has created new problems, but this is no justification to write economic globalization off completely. Rather, we should adapt to and guide economic globalization, cushion its negative impact, and deliver its benefits to all countries and all nations.
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  • Whether you like it or not, the global economy is the big ocean that you cannot escape from. Any attempt to cut off the flow of capital, technologies, products, industries and people between economies, and channel the waters in the ocean back into isolated lakes and creeks is simply not possible. Indeed, it runs counter to the historical trend.
  • First, lack of robust driving forces for global growth makes it difficult to sustain the steady growth of the global economy. The growth of the global economy is now at its slowest pace in seven years. Growth of global trade has been slower than global GDP growth. Short-term policy stimuli are ineffective. Fundamental structural reform is just unfolding. The global economy is now in a period of moving toward new growth drivers, and the role of traditional engines to drive growth has weakened. Despite the emergence of new technologies such as artificial intelligence and 3-D printing, new sources of growth are yet to emerge. A new path for the global economy remains elusive. Second, inadequate global economic governance makes it difficult to adapt to new developments in the global economy. Madame Christine Lagarde recently told me that emerging markets and developing countries already contribute to 80 percent of the growth of the global economy. The global economic landscape has changed profoundly in the past few decades. However, the global governance system has not embraced those new changes and is therefore inadequate in terms of representation and inclusiveness. The global industrial landscape is changing and new industrial chains, value chains and supply chains are taking shape. However, trade and investment rules have not kept pace with these developments, resulting in acute problems such as closed mechanisms and fragmentation of rules.
  • Third, uneven global development makes it difficult to meet people’s expectations for better lives. Dr. Schwab has observed in his book The Fourth Industrial Revolution that this round of industrial revolution will produce extensive and far-reaching impacts such as growing inequality, particularly the possible widening gap between return on capital and return on labor. The richest one percent of the world’s population own more wealth than the remaining 99 percent. Inequality in income distribution and uneven development space are worrying. Over 700 million people in the world are still living in extreme poverty. For many families, to have warm houses, enough food and secure jobs is still a distant dream. This is the biggest challenge facing the world today. It is also what is behind the social turmoil in some countries. All this shows that there are indeed problems with world economic growth, governance and development models, and they must be resolved. The founder of the Red Cross Henry Dunant once said, “Our real enemy is not the neighboring country; it is hunger, poverty, ignorance, superstition and prejudice.” We need to have the vision to dissect these problems; more importantly, we need to have the courage to take actions to address them.
  • First, we should develop a dynamic, innovation-driven growth model. The fundamental issue plaguing the global economy is the lack of driving force for growth.Innovation is the primary force guiding development. Unlike the previous industrial revolutions, the fourth industrial revolution is unfolding at an exponential rather than linear pace. We need to relentlessly pursue innovation. Only with the courage to innovate and reform can we remove bottlenecks blocking global growth and development. With this in mind, G-20 leaders reached an important consensus at the Hangzhou Summit, which is to take innovation as a key driver and foster new driving force of growth for both individual countries and the global economy. We should develop a new development philosophy and rise above the debate about whether there should be more fiscal stimulus or more monetary easing. We should adopt a multipronged approach to address both the symptoms and the underlying problems. We should adopt new policy instruments and advance structural reform to create more space for growth and sustain its momentum. We should develop new growth models and seize opportunities presented by the new round of industrial revolution and digital economy. We should meet the challenges of climate change and aging population. We should address the negative impact of IT application and automation on jobs. When cultivating new industries and new forms models of business models, we should create new jobs and restore confidence and hope to our peoples.
  • Second, we should pursue a well-coordinated and inter-connected approach to develop a model of open and win-win cooperation. Today, mankind has become a close-knit community of shared future. Countries have extensive converging interests and are mutually dependent. All countries enjoy the right to development. At the same time, they should view their own interests in a broader context and refrain from pursuing them at the expense of others. We should commit ourselves to growing an open global economy to share opportunities and interests through opening-up and achieve win-win outcomes. One should not just retreat to the harbor when encountering a storm, for this will never get us to the other shore of the ocean. We must redouble efforts to develop global connectivity to enable all countries to achieve inter-connected growth and share prosperity. We must remain committed to developing global free trade and investment, promote trade and investment liberalization and facilitation through opening-up and say no to protectionism. Pursuing protectionism is like locking oneself in a dark room. While wind and rain may be kept outside, that dark room will also block light and air. No one will emerge as a winner in a trade war.
  • Third, we should develop a model of fair and equitable governance in keeping with the trend of the times. As the Chinese saying goes, people with petty shrewdness attend to trivial matters, while people with vision attend to governance of institutions. There is a growing call from the international community for reforming the global economic governance system, which is a pressing task for us. Only when it adapts to new dynamics in the international economic architecture can the global governance system sustain global growth. Countries, big or small, strong or weak, rich or poor, are all equal members of the international community. As such, they are entitled to participate in decision-making, enjoy rights and fulfill obligations on an equal basis. Emerging markets and developing countries deserve greater representation and voice. The 2010 IMF quota reform has entered into force, and its momentum should be sustained. We should adhere to multilateralism to uphold the authority and efficacy of multilateral institutions. We should honor promises and abide by rules. One should not select or bend rules as he sees fit. The Paris Agreement is a hard-won achievement which is in keeping with the underlying trend of global development. All signatories should stick to it instead of walking away from it as this is a responsibility we must assume for future generations.
  • Despite a sluggish global economy, China’s economy is expected to grow by 6.7 percent in 2016, still one of the highest in the world. China’s economy is far bigger in size than in the past, and it now generates more output than it did with double-digit growth in the past. Household consumption and the services sector have become the main drivers of growth. In the first three quarters of 2016, added value of the tertiary industry took up 52.8 percent of the GDP and domestic consumption contributed to 71 percent of economic growth. Household income and employment have steadily risen, while per unit GDP energy consumption continues to drop. Our efforts to pursue green development are paying off. The Chinese economy faces downward pressure and many difficulties, including acute mismatch between excess capacity and an upgrading demand structure, lack of internal driving force for growth, accumulation of financial risks, and growing challenges in certain regions. We see these as temporary hardships that occur on the way forward. And the measures we have taken to address these problems are producing good results. We are firm in our resolve to forge ahead. China is the world’s largest developing country with over 1.3 billion people, and their living standards are not yet high. But this reality also means China has enormous potential and space for development. Guided by the vision of innovative, coordinated, green, open and shared development, we will adapt to the new normal, stay ahead of the curve, and make coordinated efforts to maintain steady growth, accelerate reform, adjust economic structure, improve people’s living standards and fend off risks. With these efforts, we aim to achieve medium-high rate of growth and upgrade the economy to higher end of the value chain.
  • We should foster a culture that values diligence, frugality and enterprise and respects the fruits of hard work of all. Priority should be given to addressing poverty, unemployment, the widening income gap and the concerns of the disadvantaged to promote social equity and justice. It is important to protect the environment while pursuing economic and social progress so as to achieve harmony between man and nature and between man and society. The 2030 Agenda for Sustainable Development should be implemented to realize balanced development across the world. A Chinese adage reads, “Victory is ensured when people pool their strength; success is secured when people put their heads together.” As long as we keep to the goal of building a community of shared future for mankind and work hand in hand to fulfill our responsibilities and overcome difficulties, we will be able to create a better world and deliver better lives for our peoples.
  • This is a path that puts people’s interests first. China follows a people-oriented development philosophy and is committed to bettering the lives of its people. Development is of the people, by the people and for the people. China pursues the goal of common prosperity. We have taken major steps to alleviate poverty and lifted over 700 million people out of poverty, and good progress is being made in our efforts to finish building a society of initial prosperity in all respects. This is a path of pursuing reform and innovation. China has tackled difficulties and met challenges on its way forward through reform. China has demonstrated its courage to take on difficult issues, navigate treacherous rapids and remove institutional hurdles standing in the way of development. These efforts have enabled us to unleash productivity and social vitality. Building on progress of 30-odd years of reform, we have introduced more than 1,200 reform measures over the past four years, injecting powerful impetus into China’s development.
  • This is a path of pursuing common development through opening-up. China is committed to a fundamental policy of opening-up and pursues a win-win opening-up strategy. China’s development is both domestic and external oriented; while developing itself, China also shares more of its development outcomes with other countries and peoples. China’s outstanding development achievements and the vastly improved living standards of the Chinese people are a blessing to both China and the world. Such achievements in development over the past decades owe themselves to the hard work and perseverance of the Chinese people, a quality that has defined the Chinese nation for several thousand years. We Chinese know only too well that there is no such thing as a free lunch in the world. For a big country with over 1.3 billion people, development can be achieved only with the dedication and tireless efforts of its own people. We cannot expect others to deliver development to China, and no one is in a position to do so. When assessing China’s development, one should not only see what benefits the Chinese people have gained, but also how much hard effort they have put in, not just what achievements China has made, but also what contribution China has made to the world. Then one will reach a balanced conclusion about China’s development.
  • Between 1950 and 2016, despite its modest level of development and living standard, China provided more than 400 billion yuan of foreign assistance, undertook over 5,000 foreign assistance projects, including nearly 3,000 complete projects, and held over 11,000 training workshops in China for over 260,000 personnel from other developing countries. Since it launched reform and opening-up, China has attracted over $1.7 trillion of foreign investment and made over $1.2 trillion of direct outbound investment, making huge contribution to global economic development. In the years following the outbreak of the international financial crisis, China contributed to over 30 percent of global growth every year on average. All these figures are among the highest in the world. The figures speak for themselves. China’s development is an opportunity for the world; China has not only benefited from economic globalization but also contributed to it. Rapid growth in China has been a sustained, powerful engine for global economic stability and expansion. The inter-connected development of China and a large number of other countries has made the world economy more balanced. China’s remarkable achievement in poverty reduction has contributed to more inclusive global growth. And China’s continuous progress in reform and opening-up has lent much momentum to an open world economy.
  • Fourth, we should develop a balanced, equitable and inclusive development model. As the Chinese saying goes, “A just cause should be pursued for common good.”Development is ultimately for the people. To achieve more balanced development and ensure that the people have equal access to opportunities and share in the benefits of development, it is crucial to have a sound development philosophy and model and make development equitable, effective and balanced.
  • — China will foster an enabling and orderly environment for investment. We will expand market access for foreign investors, build high-standard pilot free trade zones, strengthen protection of property rights, and level the playing field to make China’s market more transparent and better regulated. In the coming five years, China is expected to import $8 trillion of goods, attract $600 billion of foreign investment and make $750 billion of outbound investment. Chinese tourists will make 700 million overseas visits. All this will create a bigger market, more capital, more products and more business opportunities for other countries. China’s development will continue to offer opportunities to business communities in other countries. China will keep its door wide open and not close it. An open door allows both other countries to access the Chinese market and China itself to integrate with the world. And we hope that other countries will also keep their door open to Chinese investors and keep the playing field level for us.
  • — China will vigorously foster an external environment of opening-up for common development. We will advance the building of the Free Trade Area of the Asia Pacific and negotiations of the Regional Comprehensive Economic Partnership to form a global network of free trade arrangements. China stands for concluding open, transparent and win-win regional free trade arrangements and opposes forming exclusive groups that are fragmented in nature. China has no intention to boost its trade competitiveness by devaluing the RMB, still less will it launch a currency war. Over three years ago, I put forward the “Belt and Road” initiative. Since then, over 100 countries and international organizations have given warm responses and support to the initiative. More than 40 countries and international organizations have signed cooperation agreements with China, and our circle of friends along the “Belt and Road” is growing bigger. Chinese companies have made over $50 billion of investment and launched a number of major projects in the countries along the routes, spurring the economic development of these countries and creating many local jobs. The “Belt and Road” initiative originated in China, but it has delivered benefits well beyond its borders.
  • Ladies and Gentlemen,Dear Friends, World history shows that the road of human civilization has never been a smooth one, and that mankind has made progress by surmounting difficulties. No difficulty, however daunting, will stop mankind from advancing. When encountering difficulties, we should not complain about ourselves, blame others, lose confidence or run away from responsibilities. We should join hands and rise to the challenge. History is created by the brave. Let us boost confidence, take actions and march arm-in-arm toward a bright future.
  • Paul Merrell on 26 Jan 17
     
    Very important speech. A must-read (I snipped only portions).
Paul Merrell

Harder for Americans to Rise From Lower Rungs - NYTimes.com - 0 views

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class warfare income inequality economic mobility land of opportunity myth

shared by Paul Merrell on 26 Feb 13 - No Cached
  • Benjamin Franklin did it. Henry Ford did it. And American life is built on the faith that others can do it, too: rise from humble origins to economic heights. “Movin’ on up,” George Jefferson-style, is not only a sitcom song but a civil religion.
  • But many researchers have reached a conclusion that turns conventional wisdom on its head: Americans enjoy less economic mobility than their peers in Canada and much of Western Europe. The mobility gap has been widely discussed in academic circles, but a sour season of mass unemployment and street protests has moved the discussion toward center stage. Former Senator Rick Santorum of Pennsylvania, a Republican candidate for president, warned this fall that movement “up into the middle income is actually greater, the mobility in Europe, than it is in America.” National Review, a conservative thought leader, wrote that “most Western European and English-speaking nations have higher rates of mobility.” Even Representative Paul D. Ryan, a Wisconsin Republican who argues that overall mobility remains high, recently wrote that “mobility from the very bottom up” is “where the United States lags behind.”
  • Liberal commentators have long emphasized class, but the attention on the right is largely new.
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  • At least five large studies in recent years have found the United States to be less mobile than comparable nations. A project led by Markus Jantti, an economist at a Swedish university, found that 42 percent of American men raised in the bottom fifth of incomes stay there as adults. That shows a level of persistent disadvantage much higher than in Denmark (25 percent) and Britain (30 percent) — a country famous for its class constraints. Meanwhile, just 8 percent of American men at the bottom rose to the top fifth. That compares with 12 percent of the British and 14 percent of the Danes.
  • Despite frequent references to the United States as a classless society, about 62 percent of Americans (male and female) raised in the top fifth of incomes stay in the top two-fifths, according to research by the Economic Mobility Project of the Pew Charitable Trusts. Similarly, 65 percent born in the bottom fifth stay in the bottom two-fifths. By emphasizing the influence of family background, the studies not only challenge American identity but speak to the debate about inequality. While liberals often complain that the United States has unusually large income gaps, many conservatives have argued that the system is fair because mobility is especially high, too: everyone can climb the ladder. Now the evidence suggests that America is not only less equal, but also less mobile.
Gary Edwards

Naked Capitalism: "Only 21% Say U.S. Government Has Consent of the Governed ... - 0 views

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obammunism socialism oligarchy

shared by Gary Edwards on 19 Feb 10 - Cached
  • Gary Edwards on 19 Feb 10
     
    A new Rasmussen poll finds: The founding document of the United States, the Declaration of Independence, states that governments derive "their just powers from the consent of the governed." Today, however, just 21% of voters nationwide believe that the federal government enjoys the consent of the governed. *** Seventy-one percent (71%) of all voters now view the federal government as a special interest group, and 70% believe that the government and big business typically work together in ways that hurt consumers and investors.That helps explain why 75% of voters are angry at the policies of the federal government, and 63% say it would be better for the country if most members of Congress are defeated this November… In his new book, In Search of Self-Governance, Scott Rasmussen observes that the American people are "united in the belief that our political system is broken, that politicians are corrupt, and that neither major political party has the answers." He adds that "the gap between Americans who want to govern themselves and the politicians who want to rule over them may be as big today as the gap between the colonies and England during the 18th century." *** Sixty percent (60%) of voters think that neither Republican political leaders nor Democratic political leaders have a good understanding of what is needed today. Thirty-five percent (35%) say Republicans and Democrats are so much alike that an entirely new political party is needed to represent the American people. Nearly half of all voters believe that people randomly selected from the phone book could do as good a job as the current Congress.
Paul Merrell

Rents Are Rising But People Aren't Making Any More Money - 0 views

thinkprogress.org/...rent-up-wages-flat

financial-collapse housing-rental cost-of-living

shared by Paul Merrell on 04 Jul 14 - No Cached
  • The average apartment rent hit $1,099 in the second quarter of the year, new data from a real estate research firm shows, as the gap between the typical American’s cost of living and the wages she earns from working continued to widen.
  • Average rents rose by 0.8 percent from March to June, and are now up 3.4 percent over the past year, according to Reis Inc. data. In total, the average monthly rent price is now up almost 15 percent since 1990, after adjusting for inflation. By comparison, the median household income has grown exactly zero percent since 1990, the Wall Street Journal notes:
  • Even those gloomy national figures paint a rosier picture than the reality that tens of millions of American families face. If you do the math using the top-line numbers, rents still seem affordable: the average calculates out to about 26 percent of a person’s yearly income going toward rent. But that’s not how it actually operates on the ground. A full 50 percent of American renters spend more than 30 percent of their income on housing, which is what researchers define as the cutoff for affordable housing. More than a quarter face extremely unaffordable housing costs, meaning they spend more than half their income on housing. A New York Times and Zillow analysis found that median rent was above the 30 percent affordability threshold in 90 different U.S. cities, even before this most recent quarterly rise in rent prices. Rents are outpacing earnings in part because the demand for rental housing has exploded since the financial crisis. Foreclosed homeowners and others unable to afford or obtain a mortgage are turning instead to the rental market. Cuts to government housing aid spending and the broader stagnation of wages for working people increase the reliance on rental even more.
Paul Merrell

Two Supermarket Executives Charged With Hoarding in Venezuela | venezuelanalysis.com - 0 views

venezuelanalysis.com/11294

war & peace Venezuela U.S.-foreign-policy hoarding litigation

shared by Paul Merrell on 25 Mar 15 - No Cached
  • Two managers of the private supermarket chain Dia Dia were formally charged by the Venezuelan state prosecutor yesterday with the alleged crimes of boycott and destabilization of the economy. Manuel Andrés Morales Ordosgoitti and Tadeo Arriechi Franco were arrested at the beginning of February after state authorities uncovered ton loads of basic items in a Dia Dia warehouse in Caracas. The indictments are part of a ramped up effort on the part of the Venezuelan government to crack down on hoarding and speculation by large private retailers, which is a primary contributing factor to inflation and widespread scarcities of basic goods.
  • The Bolivarian government has regulated the prices of everyday goods for years, in order to ensure access by the majority of Venezuelans for whom they were unaffordable under previous administrations. Nonetheless, the government has accused the private sector of exploiting this policy by hoarding cheap subsidized goods, creating consumer gaps, then selling them at exorbitant prices on the black market in what President Maduro has termed an “economic war” waged to destabilize the socialist government. Last month, board members of the private firms Dia Dia and Carnica 2005 were arrested for their companies’ role in a massive hoarding operation.
  • Carnica 2005 was nationalized and integrated into the state food distribution network PDVAL. Dia Dia operates 35 supermarkets throughout Venezuela, which are largely found in low-income communities.
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  • On Monday, Venezuelan Vice-President Jorge Arreaza inaugurated the first of the nation’s “people’s military commands” in Lara state, which will be charged with “generating a victory in the economic war.” Last month, President Nicolas Maduro unveiled his plan for the creation of “peoples’ military commands” throughout the nation designed to combat “economic sabotage” at the local level by ensuring the supply of basic food and hygiene products as well as medicines. “The men and women who form these commands have the responsibility of attending to the denunciations of the people and safeguarding their access to food, medicine, and all necessary products,” declared the vice-president.
  • The people’s commands will reportedly operate in coordination with social movements, communal councils and communes, and state security organs, although details remain limited as the project is gets off the ground. 
  • Paul Merrell on 25 Mar 15
     
    It's a big problem in Venezuela. The government subsidizes the purchase of consumer goods so that they can be priced lower for those with low incomes. But the right-wing "capitalists" aligned with U.S. covert agencies hoard the goods, creating artificial market shortages, then sell the goods on the black market at inflated prices. The current response by the government is criiminal prosecutions coupled with nationalization of businesses that don't hear the message. I suspect that the government may be forced at some point to drop the subsidies and begin writing welfare checks to low income citizens instead. The Bolivarian government is absolutely committed to ending poverty in Venezuela. Of course this smells too much of socialism for U.S. government tastes, which has been attempting to overthrow the Bolivarian government ever since it nationalized the oil industry. 
Gary Edwards

The Fourth Industrial Revolution: what it means and how to respond - Agenda - The World... - 0 views

agenda.weforum.org/...at-it-means-and-how-to-respond

shared by Gary Edwards on 26 Dec 15 - No Cached
  • The First Industrial Revolution used water and steam power to mechanize production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production. Now a Fourth Industrial Revolution is building on the Third, the digital revolution that has been occurring since the middle of the last century. It is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.
  • Like the revolutions that preceded it, the Fourth Industrial Revolution has the potential to raise global income levels and improve the quality of life for populations around the world. To date, those who have gained the most from it have been consumers able to afford and access the digital world; technology has made possible new products and services that increase the efficiency and pleasure of our personal lives. Ordering a cab, booking a flight, buying a product, making a payment, listening to music, watching a film, or playing a game—any of these can now be done remotely.
  • In the future, technological innovation will also lead to a supply-side miracle, with long-term gains in efficiency and productivity. Transportation and communication costs will drop, logistics and global supply chains will become more effective, and the cost of trade will diminish, all of which will open new markets and drive economic growth.
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  • As automation substitutes for labor across the entire economy, the net displacement of workers by machines might exacerbate the gap between returns to capital and returns to labor. On the other hand, it is also possible that the displacement of workers by technology will, in aggregate, result in a net increase in safe and rewarding jobs.
  • I am convinced of one thing—that in the future, talent, more than capital, will represent the critical factor of production.
  • This will give rise to a job market increasingly segregated into “low-skill/low-pay” and “high-skill/high-pay” segments, which in turn will lead to an increase in social tensions.
  • In addition to being a key economic concern, inequality represents the greatest societal concern associated with the Fourth Industrial Revolution.
  • The largest beneficiaries of innovation tend to be the providers of intellectual and physical capital—the innovators, shareholders, and investors—which explains the rising gap in wealth between those dependent on capital versus labor.
  • Technology is therefore one of the main reasons why incomes have stagnated, or even decreased, for a majority of the population in high-income countries: the demand for highly skilled workers has increased while the demand for workers with less education and lower skills has decreased. The result is a job market with a strong demand at the high and low ends, but a hollowing out of the middle.
  • A winner-takes-all economy that offers only limited access to the middle class is a recipe for democratic malaise and dereliction.
  • An underlying theme in my conversations with global CEOs and senior business executives is that the acceleration of innovation and the velocity of disruption are hard to comprehend or anticipate and that these drivers constitute a source of constant surprise, even for the best connected and most well informed. Indeed, across all industries, there is clear evidence that the technologies that underpin the Fourth Industrial Revolution are having a major impact on businesses.
  • On the supply side, many industries are seeing the introduction of new technologies that create entirely new ways of serving existing needs and significantly disrupt existing industry value chains. Disruption is also flowing from agile, innovative competitors who, thanks to access to global digital platforms for research, development, marketing, sales, and distribution, can oust well-established incumbents faster than ever by improving the quality, speed, or price at which value is delivered.
  • Major shifts on the demand side are also occurring, as growing transparency, consumer engagement, and new patterns of consumer behavior (increasingly built upon access to mobile networks and data) force companies to adapt the way they design, market, and deliver products and services.
  • A key trend is the development of technology-enabled platforms that combine both demand and supply to disrupt existing industry structures, such as those we see within the “sharing” or “on demand” economy. These technology platforms, rendered easy to use by the smartphone, convene people, assets, and data—thus creating entirely new ways of consuming goods and services in the process. In addition, they lower the barriers for businesses and individuals to create wealth, altering the personal and professional environments of workers. These new platform businesses are rapidly multiplying into many new services, ranging from laundry to shopping, from chores to parking, from massages to travel.
  • On the whole, there are four main effects that the Fourth Industrial Revolution has on business—on customer expectations, on product enhancement, on collaborative innovation, and on organizational forms.
  • Overall, the inexorable shift from simple digitization (the Third Industrial Revolution) to innovation based on combinations of technologies (the Fourth Industrial Revolution) is forcing companies to reexamine the way they do business. The bottom line, however, is the same: business leaders and senior executives need to understand their changing environment, challenge the assumptions of their operating teams, and relentlessly and continuously innovate.
  • governments will increasingly face pressure to change their current approach to public engagement and policymaking, as their central role of conducting policy diminishes owing to new sources of competition and the redistribution and decentralization of power that new technologies make possible.
  • Ultimately, the ability of government systems and public authorities to adapt will determine their survival. If they prove capable of embracing a world of disruptive change, subjecting their structures to the levels of transparency and efficiency that will enable them to maintain their competitive edge, they will endure. If they cannot evolve, they will face increasing trouble.
  • In the end, it all comes down to people and values. We need to shape a future that works for all of us by putting people first and empowering them. In its most pessimistic, dehumanized form, the Fourth Industrial Revolution may indeed have the potential to “robotize” humanity and thus to deprive us of our heart and soul. But as a complement to the best parts of human nature—creativity, empathy, stewardship—it can also lift humanity into a new collective and moral consciousness based on a shared sense of destiny. It is incumbent on us all to make sure the latter prevails.
Paul Merrell

Economic Recovery Is Mostly A Myth For The 99 Percent - 0 views

shadowproof.com/...y-mostly-a-myth-for-99-percent

economy income-inequality stats

shared by Paul Merrell on 29 Dec 16 - No Cached
  • So, the rich have genuinely and thoroughly recovered from the crash of 2008. But what about everyone else? * 93 percent of U.S. counties haven’t recovered from the Great Recession according to the National Association of Counties. * According to Pew, the middle class is now no longer the majority in America. * The “recovery gap” has more than 50 million Americans living in economically distressed regions plagued by high levels of unemployment, poverty and fiscal anxiety. * Nearly 95 percent of all new jobs under President Barack Obama were part-time, or contract, which pay less and are precarious. * Due to unprecedented and often illegal home foreclosures by banks, the wealth gap between whites and blacks grew during the era of Obama. * 63 percent of Americans do not have enough savings to cover an unforeseen $500 bill. The only serious counterargument to this narrative is to note many of these trends preceded the Great Recession. That is sadly true. Workers have seen stagnant wages for decades and a decreasing share of income and wealth. As the Institute for Policy Studies notes, between 1983 and 2009, over 40 percent of all wealth gains flowed to the 1 percent and 82 percent of wealth gains went to the top 5 percent. President Obama said in 2013 that economic inequality was “the defining issue of our time.” If so, Obama largely failed to do anything meaningful to address this issue.
Gary Edwards

How IT Costs More Jobs than It Creates - Technology Review - 0 views

www.technologyreview.com/...page2

shared by Gary Edwards on 26 Oct 11 - No Cached
  • Brynjolfsson and McAfee cite evidence that—in addition to other macroeconomic problems, and the 2008 financial crisis—the U.S. economy is undergoing a structural change wrought by technology. "It's not just the crash, it's something that is changing fundamentally in the way people use technology," Brynjolfsson says
    • Gary Edwards
      Gary Edwards on 26 Oct 11
       
      Maybe it's true that technological changes to "productivity" are coming so fast, and with such dramatic improvements, that people can't adapt and keep up; creating a human vs tech productivity gap.  Maybe though, productivity / employment is not the most accurate gauge for measuring income, prosperity and wealth.  Consumption and investment have to be factored in.  The Fair Tax is a better fit for this high tech  productivity world than the Progressive Income Tax. Societies that carry a huge militaristic and/or socialistic cost to citizenship and governance are certainly at a competitive disadvantage in a global economy.  The cost of productivity has to carry the weight of militaristic/socialist government.  In the US, near 50% of the population exist on government subsidized income/re-distribution.  If it wasn't for tech pumped productivity, where the return on investment jumps also as labor cost and the cost of product/services distribution falls, it would be impossible for the US private sector to carry the enormous weight of government. It seems to me though that consumption has it's own internal balancing mechanism, if only the government would get out of the way and let it work.  Citizens can't consume if they don't produce.  Regardless of the the tech productivity bump factor!   The other point is that much of this discussion rests on the gravitational law that digital information represents reality; and digital services make reality more efficient with global distribution possibilities (larger markets).  But you can't eat "digital representations of reality".  You can't physically fly from San Francisco to NYC using strictly digital representations, even though you can simulate communication and connectivity "digitally". At the end of the day, digital machines enable us to work reality in new and efficient ways.  But they are still machines.  And a reality of physical dimensions remains.
Paul Merrell

American Democracy is Owned by the Rich | Al Jazeera America - 1 views

america.aljazeera.com/...he-rich-own-our-democracy.html

U.S. Congress corruption

shared by Paul Merrell on 19 Feb 15 - No Cached
  • Two new studies by political scientists offer compelling evidence that the rich use their wealth to control the political system and that the U.S. is a democratic republic in name only. In a study of Senate voting patterns, Michael Jay Barber found that “senators’ preferences reflect the preferences of the average donor better than any other group.” In a similar study of the House of Representatives, Jesse H. Rhodes and Brian F. Schaffner found that, “millionaires receive about twice as much representation when they comprise about 5 percent of the district’s population than the poorest wealth group does when it makes up 50 percent of the district.” In fact, the increasing influence of the rich over Congress is the leading driver of polarization in modern politics, with the rich using the political system to entrench wealth by pushing for tax breaks and blocking redistributive policies.
  • At the turn of the decade, political scientists Larry Bartels, Jacob Hacker and Martin Gilens wrote several incredibly influential important books arguing, persuasively, that the preferences of the rich were better represented in Congress than the poor. After the books were published, there was a flurry of research arguing that they had overstated their case. Critics alleged two key defects in Bartels’ and Gilens’ arguments. First, because polling data on the super-wealthy were sparse, it was difficult to prove that there were large differences in opinion. Political scientists often rely on composite measures of policy liberalism, but since the poor tend to be more economically liberal but socially conservative, the differences between the poor and moderately rich can often be obscured. Second, there was no way to show that influence of the wealthy was caused directly by the influence of money. It might well be that the rich are simply opinion leaders or are more likely to vote.
  • Recent research offers compelling answers to these criticisms. The new evidence adds credence to the Bartels-Gilens-Hacker view that money is corrupting American politics. By using a massive database of ideology that includes the super wealthy, Schaffner and Rhodes found that “members of Congress are much more responsive to the wealthy than to their poor constituents.” However, this difference is not equal between both parties; rather, Democrats are far more responsive to the poor than Republicans. (This is not surprising; other research supports this claim.) They find that both parties strongly favor the upper-middle class, those with $100,000 to $300,000 in wealth. But Republicans are not only more responsive to the rich, but particularly to rich donors. Schaffner and Rhodes argue that, “campaign donations, but not voter registration or participation in primary or general election, may help explain the disproportionate influence of the wealthy among Republican representatives.” Barber’s study is the first to directly examine the policy preferences of the donor class. Barber sent 20,500 letters to people who contributed to 22 Senate elections in 2012 and asked about various policy questions. This allowed Barber to examine the differences in representation between donors and non-donors. His finding: Donors’ preferences tend to be far better represented than non-donors’. The chart below measures the ideological differences between various groups, with 0 indicating a perfect fit. The data show that Senators are almost perfectly aligned with their donors, but rather distant from voters.
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  • In fact, politicians are almost perfectly aligned with donors, but less aligned with partisans (people who voted for the Senator and share party affiliation), supporters (people who voted for the Senator) and voters in general. He Barber also finds that donors tend to be far more extreme in their views (see chart below). For instance, while about sixty percent of non-donor Republicans oppose the Affordable Care Act, opposition among donors is “almost unanimous.” Barber also notes that donors tend to be far more extreme than non-donors (see chart). (This is supported by other studies).
  • Such data could explain the rising polarization of Congress, as politicians increasingly respond to their donors, rather than to voters. Political scientists Walter J. Stone and Elizabeth N. Simas have found that challengers raise more money when they take extreme positions, which helps explain why incumbent representatives tend to be more partisan than departing representatives. It certainly explains the intransigence of the last two Congresses: Republicans, who are responding to their rich donor base, are incentivized to oppose any action, particularly those supporting Obama, lest they lose funding. Since Senators have to raise approximately $3,300 a day every year for six years to remain viable, they will inevitably have to succumb to the power of money if they wish to be reelected. This research raises the disturbing thought that our political system is no longer representative. As Barber notes, about half of all donors are from out of state, meaning that politicians are no longer responsive to their voters (though they are slightly more during election years). Given that only .22 percent of Americans made a donation of more than $200 (the level Barber studies) in 2014, we have power evidence that America is now a government of the one percent — indeed, of the one-fifth of one percent.
  • This disturbing trend affects politics at all levels. At the state level, political scientists Gerald Wright and Elizabeth Rigby found that state party platforms are far more influenced by the rich than the poor. Elsewhere, Barber found evidence that presidents are more responsive to donors than non-donors. Recently Griffin and Newman found representation gaps between whites and people of color as well as low-income voters. This finding is supported by Christopher Ellis, who found that donors were better represented than non-donors (although using a less comprehensive method than Barber). In a frank moment, U.S. Sen. Chris Murphy (D – Conn.) said, “I talked a lot more about carried interest inside of that call room than I did in the supermarket.” He’s correct: Donors tending to be far richer and wealthier than non-donors (see chart).
  • There are still unanswered questions. It is possible that politicians cast ideological votes to appease donors and partisans (for instance, the vain attempt to repeal the Affordable Care Act dozens of times), while also working to benefit the poor and middle class through less visible means. This might explain why political journalists, who often focus on major legislation, miss the distributional impacts of political appointments and regulatory action. It may be that politicians work to maximize votes, and then political donations follow (though there is strong evidence this isn’t the case). Either way, the most up-to-date evidence strongly suggests that money is distorting our system, and that evidence appears to be growing stronger by the day.
  • The solution, as a recent Demos report suggests, is to help reformist candidates gather donations with a public matching system. Since voters who are non-donors are less ideological, the solution is to balance out the political distortions from the donor class by turning these non-donors into donors. Citizens United has only increased the stranglehold of moneyed interests on our political system, and is daily choking the life of our democracy. Only by restoring influence to all voters will our republic be restored.
Paul Merrell

The Collapse of Europe? « LobeLog - 0 views

www.lobelog.com/the-collapse-of-europe

EU-breakup Hungary Greece Russia China border-restrictions anti-Islam Euroskeptics

shared by Paul Merrell on 28 Jan 15 - No Cached
  • And yet, for all this success, the European project is currently teetering on the edge of failure. Growth is anemic at best and socio-economic inequality is on the rise. The countries of Eastern and Central Europe, even relatively successful Poland, have failed to bridge the income gap with the richer half of the continent. And the highly indebted periphery is in revolt. Politically, the center may not hold and things seem to be falling apart. From the left, parties like Syriza in Greece are challenging the EU’s prescriptions of austerity. From the right, Euroskeptic parties are taking aim at the entire quasi-federal model. Racism and xenophobia are gaining ever more adherents, even in previously placid regions like Scandinavia. Perhaps the primary social challenge facing Europe at the moment, however, is the surging popularity of Islamophobia, the latest “socialism of fools.” From the killings at the Munich Olympics in 1972 to the recent attacks at Charlie Hebdo and a kosher supermarket in Paris, wars in the Middle East have long inspired proxy battles in Europe. Today, however, the continent finds itself ever more divided between a handful of would-be combatants who claim the mantle of true Islam and an ever-growing contingent who believe Islam — all of Islam — has no place in Europe.
  • Europeans are beginning to realize that Margaret Thatcher was wrong and there are alternatives — to liberalism and European integration. The most notorious example of this new illiberalism is Hungary. On July 26, 2014, in a speech to his party faithful, Prime Minister Viktor Orban confided that he intended a thorough reorganization of the country. The reform model Orban had in mind, however, had nothing to do with the United States, Britain, or France. Rather, he aspired to create what he bluntly called an “illiberal state” in the very heart of Europe, one strong on Christian values and light on the libertine ways of the West. More precisely, what he wanted was to turn Hungary into a mini-Russia or mini-China. “Societies founded upon the principle of the liberal way,” Orban intoned, “will not be able to sustain their world-competitiveness in the following years, and more likely they will suffer a setback, unless they will be able to substantially reform themselves.” He was also eager to reorient to the east, relying ever less on Brussels and ever more on potentially lucrative markets in and investments from Russia, China, and the Middle East.
  • For some, the relationship between Hungary and the rest of Europe is reminiscent of the moment in the 1960s when Albania fled the Soviet bloc and, in an act of transcontinental audacity, aligned itself with Communist China. But Albania was then a marginal player and China still a poor peasant country. Hungary is an important EU member and China’s illiberal development model, which has vaulted it to the top of the global economy, now has increasing international influence. This, in other words, is no Albanian mouse that roared. A new illiberal axis connecting Budapest to Beijing and Moscow would have far-reaching implications.
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  • That July speech represented a truly Oedipal moment, for Orban was eager to drive a stake right through the heart of the ideology that had fathered him. As a young man more than 25 years earlier, he had led the Alliance of Young Democrats — Fidesz — one of the region’s most promising liberal parties. In the intervening years, sensing political opportunity elsewhere on the political spectrum, he had guided Fidesz out of the Liberal International and into the European People’s Party, alongside German Chancellor Angela Merkel’s Christian Democrats. Now, however, he was on the move again and his new role model wasn’t Merkel, but Russian President Vladimir Putin and his iron-fisted style of politics. Given the disappointing performance of liberal economic reforms and the stinginess of the EU, it was hardly surprising that Orban had decided to hedge his bets by looking east. The European Union has responded by harshly criticizing Orban’s government for pushing through a raft of constitutional changes that restrict the media and compromise the independence of the judiciary. Racism and xenophobia are on the uptick in Hungary, particularly anti-Roma sentiment and anti-Semitism. And the state has taken steps to reassert control over the economy and impose controls on foreign investment.
  • The Hungarian prime minister, after all, has many European allies in his Euroskeptical project. Far right parties are climbing in the polls across the continent. With 25% of the votes, Marine Le Pen’s National Front, for instance, topped the French elections for the European parliament last May. In local elections in 2014, it also seized 12 mayoralties, and polls show that Le Pen would win the 2017 presidential race if it were held today. In the wake of the Charlie Hebdo shootings, the National Front has been pushing a range of policies from reinstating the death penalty to closing borders that would deliberately challenge the whole European project. In Denmark, the far-right People’s Party also won the most votes in the European parliamentary elections. In November, it topped opinion polls for the first time. The People’s Party has called for Denmark to slam shut its open-door policy toward refugees and re-introduce border controls. Much as the Green Party did in Germany in the 1970s, groupings like Great Britain’s Independence Party, the Finns Party, and even Sweden’s Democrats are shattering the comfortable conservative-social democratic duopoly that has rotated in power throughout Europe during the Cold War and in its aftermath.
  • The Islamophobia that has surged in the wake of the murders in France provides an even more potent arrow in the quiver of these parties as they take on the mainstream. The sentiment currently expressed against Islam — at rallies, in the media, and in the occasional criminal act — recalls a Europe of long ago, when armed pilgrims set out on a multiple crusades against Muslim powers, when early nation-states mobilized against the Ottoman Empire, and when European unity was forged not out of economic interest or political agreement but as a “civilizational” response to the infidel.
  • Euroskepticism doesn’t only come from the right side of the political spectrum. In Greece, the Syriza party has challenged liberalism from the left, as it leads protests against EU and International Monetary Fund austerity programs that have plunged the population into recession and revolt. As elsewhere in Europe, the far right might have taken advantage of this economic crisis, too, had the government not arrested the Golden Dawn leadership on murder and other charges. In parliamentary elections on Sunday, Syriza won an overwhelming victory, coming only a couple seats short of an absolute majority. In a sign of the ongoing realignment of European politics, that party then formed a new government not with the center-left, but with the right-wing Independent Greeks, which is similarly anti-austerity but also skeptical of the EU and in favor of a crackdown on illegal immigration.
  • Paul Merrell on 28 Jan 15
     
    Greece and Hungary moving to the right *and toward Russia and China.* The Syrza Party won big in Greece on Sunday. 
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