Smaller countries are becoming the healthiest

Bloomberg reports:

There’s more to life than money, and economists know it. As new assessments of global living standards proliferate, attempting to gauge how healthy, happy and successful humans are depending on where they live, a pattern is slowly emerging.

While slight variations in data can throw up different winners, smaller countries are increasingly dominating the top of the lists while big countries with booming economies fall behind.

A new analysis, the Global Wellness Index published by investment firm LetterOne, ranks Canada as the best country out of the 151 nations evaluated. The U.S. trails far behind, coming in at 37. In a tighter ranking of G-20 nations combined with the 20 most populous countries on the planet, South Africa comes in dead last, below Ukraine, Egypt and Iraq.

Based on a basket of metrics ranging from government healthcare spending to rates of depression, alcohol use, smoking, happiness and exercise, the new index is the latest attempt by economists to evaluate the world beyond economic growth. Last month, Bloomberg’s own research named Spain the world’s healthiest country. [Continue reading…]

Surge in U.S. economists’ support for carbon tax to tackle climate change

The Financial Times reports:

US economists led by former US Federal Reserve chair Janet Yellen are uniting in record numbers to back the idea of a carbon tax as the most effective and immediate way of tackling climate change.

At a time when Democrats including New York congresswoman Alexandria Ocasio-Cortez are pushing a sweeping “Green New Deal” programme to reduce greenhouse emissions, climate change is shaping up to be a major 2020 election issue. The US is the world’s second-biggest emitter of carbon dioxide, behind China.

But Ms Yellen told the Financial Times the Green New Deal was costly, whereas the carbon tax, which would plough proceeds back to the public in dividend payments, would be the “most efficient way” to reduce emissions.

“Global climate change is a very serious problem and it calls for immediate national action,” she said. “If you were to start around $40 a ton and then raise this over time, by more than the rate of inflation, this would be a very effective way of reducing carbon emissions and would more than meet the Paris commitment.”

The carbon tax proposal, organised by the Climate Leadership Council, is a bipartisan effort that has united senior economists from both parties, and now garnered 3,300 signatures from professional economists and academics across the US. [Continue reading…]

Can sustainable agriculture survive under capitalism?

Sophie Yeo writes:

It was one of the most beautiful—and one of the most sustainable—farms that Ryanne Pilgeram had ever seen. When she arrived, Penny, the farmer, was sorting through vegetables in the shed. Her husband Jeff, who had a full-time job as a doctor, was hauling flakes of alfalfa to feed the draft horses that they used in place of tractors.

Pilgeram, a sociologist at the University of Idaho, was touring the farm as part of her research into sustainable agriculture in the Pacific Northwest. She had grown up on a ranch in Montana and was already familiar with the world of conventional farming, although her family’s own land had been lost in the farm crisis of the 1980s.

Perhaps for that reason, she froze when a feral dog darted out from a shed and, in front of Pilgeram and the two farmers, ran off with a live chicken, which fell limp in its jaws. This dog was no stranger to the couple. She had just given birth to a litter of puppies, and Pilgeram later learned that she’d been stealing a chicken every day for a week.

“I just remember being really anxious—like, this is not going to end well, I should probably just get my car and go home,” Pilgeram recalls. “Where I grew up, they would have just shot the dog, right?”

But instead of going for his gun, Jeff offered Pilgeram one of the new puppies. She describes the moment as one of culture shock. “They were super chill about it, like it was not a big deal,” she says. “I just kept thinking that it’s a pretty privileged position to be in, to not care if some of your livestock is taken.”

In many ways, Pilgeram found that this couple (whose names she has changed in compiling her research) epitomized the new generation of farmers moving into Western states like Idaho, Washington, and Montana. [Continue reading…]

The age of surveillance capitalism

John Naughton writes:

We’re living through the most profound transformation in our information environment since Johannes Gutenberg’s invention of printing in circa 1439. And the problem with living through a revolution is that it’s impossible to take the long view of what’s happening. Hindsight is the only exact science in this business, and in that long run we’re all dead. Printing shaped and transformed societies over the next four centuries, but nobody in Mainz (Gutenberg’s home town) in, say, 1495 could have known that his technology would (among other things): fuel the Reformation and undermine the authority of the mighty Catholic church; enable the rise of what we now recognise as modern science; create unheard-of professions and industries; change the shape of our brains; and even recalibrate our conceptions of childhood. And yet printing did all this and more.

Why choose 1495? Because we’re about the same distance into our revolution, the one kicked off by digital technology and networking. And although it’s now gradually dawning on us that this really is a big deal and that epochal social and economic changes are under way, we’re as clueless about where it’s heading and what’s driving it as the citizens of Mainz were in 1495.

That’s not for want of trying, mind. Library shelves groan under the weight of books about what digital technology is doing to us and our world. Lots of scholars are thinking, researching and writing about this stuff. But they’re like the blind men trying to describe the elephant in the old fable: everyone has only a partial view, and nobody has the whole picture. So our contemporary state of awareness is – as Manuel Castells, the great scholar of cyberspace once put it – one of “informed bewilderment”.

Which is why the arrival of Shoshana Zuboff’s new book is such a big event. Many years ago – in 1988, to be precise – as one of the first female professors at Harvard Business School to hold an endowed chair she published a landmark book, The Age of the Smart Machine: The Future of Work and Power, which changed the way we thought about the impact of computerisation on organisations and on work. It provided the most insightful account up to that time of how digital technology was changing the work of both managers and workers. And then Zuboff appeared to go quiet, though she was clearly incubating something bigger. The first hint of what was to come was a pair of startling essays – one in an academic journal in 2015, the other in a German newspaper in 2016. What these revealed was that she had come up with a new lens through which to view what Google, Facebook et al were doing – nothing less than spawning a new variant of capitalism. Those essays promised a more comprehensive expansion of this Big Idea.

And now it has arrived – the most ambitious attempt yet to paint the bigger picture and to explain how the effects of digitisation that we are now experiencing as individuals and citizens have come about.

The headline story is that it’s not so much about the nature of digital technology as about a new mutant form of capitalism that has found a way to use tech for its purposes. The name Zuboff has given to the new variant is “surveillance capitalism”. It works by providing free services that billions of people cheerfully use, enabling the providers of those services to monitor the behaviour of those users in astonishing detail – often without their explicit consent.

“Surveillance capitalism,” she writes, “unilaterally claims human experience as free raw material for translation into behavioural data. Although some of these data are applied to service improvement, the rest are declared as a proprietary behavioural surplus, fed into advanced manufacturing processes known as ‘machine intelligence’, and fabricated into prediction products that anticipate what you will do now, soon, and later. Finally, these prediction products are traded in a new kind of marketplace that I call behavioural futures markets. Surveillance capitalists have grown immensely wealthy from these trading operations, for many companies are willing to lay bets on our future behaviour.” [Continue reading…]

Luxembourg makes all public transport free

CNN reports:

With a population of 602,000, Luxembourg is one of Europe’s smallest countries — yet it suffers from major traffic jams.

But that could be about to change. Last month, it announced plans to make all public transport — trains, trams and buses — free from March 2020.

The government hopes the move will alleviate heavy congestion and bring environmental benefits, according to Dany Frank, a spokesperson for the Ministry of Mobility and Public Works.

Landlocked Luxembourg is one of the richest countries in Europe, with the highest per capita GDP in the European Union. [Continue reading…]

U.S. carbon emissions surged in 2018 even as coal plants closed

The New York Times reports:

America’s carbon dioxide emissions rose by 3.4 percent in 2018, the biggest increase in eight years, according to a preliminary estimate published Tuesday.

Strikingly, the sharp uptick in emissions occurred even as a near-record number of coal plants around the United States retired last year, illustrating how difficult it could be for the country to make further progress on climate change in the years to come, particularly as the Trump administration pushes to roll back federal regulations that limit greenhouse gas emissions.

The estimate, by the research firm Rhodium Group, pointed to a stark reversal. Fossil fuel emissions in the United States have fallen significantly since 2005 and declined each of the previous three years, in part because of a boom in cheap natural gas and renewable energy, which have been rapidly displacing dirtier coal-fired power.

Yet even a steep drop in coal use last year wasn’t enough to offset rising emissions in other parts of the economy. Some of that increase was weather-related: A relatively cold winter led to a spike in the use of oil and gas for heating in areas like New England.

But, just as important, as the United States economy grew at a strong pace last year, emissions from factories, planes and trucks soared. And there are few policies in place to clean those sectors up.

“The big takeaway for me is that we haven’t yet successfully decoupled U.S. emissions growth from economic growth,” said Trevor Houser, a climate and energy analyst at the Rhodium Group. [Continue reading…]

What Alexandria Ocasio-Cortez knows about tax policy

Paul Krugman writes:

I have no idea how well Alexandria Ocasio-Cortez will perform as a member of Congress. But her election is already serving a valuable purpose. You see, the mere thought of having a young, articulate, telegenic nonwhite woman serve is driving many on the right mad — and in their madness they’re inadvertently revealing their true selves.

Some of the revelations are cultural: The hysteria over a video of AOC dancing in college says volumes, not about her, but about the hysterics. But in some ways the more important revelations are intellectual: The right’s denunciation of AOC’s “insane” policy ideas serves as a very good reminder of who is actually insane.

The controversy of the moment involves AOC’s advocacy of a tax rate of 70-80 percent on very high incomes, which is obviously crazy, right? I mean, who thinks that makes sense? Only ignorant people like … um, Peter Diamond, Nobel laureate in economics and arguably the world’s leading expert on public finance (although Republicans blocked him from an appointment to the Federal Reserve Board with claims that he was unqualified. Really.) And it’s a policy nobody has every implemented, aside from … the United States, for 35 years after World War II — including the most successful period of economic growth in our history. [Continue reading…]

With a Green New Deal, here’s what the world could look like for the next generation

Kate Aronoff reports:

What, exactly, would a Green New Deal entail?

Like its 1930s counterpart, the “Green New Deal” isn’t a specific set of programs so much as an umbrella under which various policies might fit, ranging from technocratic to transformative. The sheer scale of change needed to deal effectively with climate change is massive, as the scientific consensus is making increasingly clear, requiring an economy-wide mobilization of the sort that the United States hasn’t really undertaken since World War II. While the Green New Deal imaginary evokes images of strapping young men pulling up their sleeves to hoist up wind turbines (in the mold of realist Civilian Conservation Corps ads), its actual scope is far broader than the narrow set of activities typically housed under the green jobs umbrella, or even in the original New Deal.

“People talk often about the infrastructure investment that has to happen, and new technology,” Saikat Chakrabarti, Ocasio-Cortez’s chief of staff, told me. “But there’s also an industrial plan that needs to happen to build entirely new industries. It’s sort of like the moonshot. When JFK said America was going to go to the moon, none of the things we needed to get to the moon at that point existed. But we tried and we did it.” The Green New Deal, he added, “touches everything — it’s basically a massive system upgrade for the economy.”

In a broad sense, that’s what policymakers in other countries refer to as industrial policy, whereby the government plays a decisive role in shaping the direction of the economy to accomplish specific aims. That doesn’t mean that the state controls every industry, as in the Soviet system; instead, it would be closer to the kind of economic planning that the U.S. practiced during the economic mobilization around World War II, and that is practiced internally today by many of the world’s biggest corporations. Should Ocasio-Cortez’s resolution pass muster, the select committee will convene policymakers, academics, and representatives from the private sector and civil society to hash out next steps. How widely or narrowly that groups defines a Green New Deal — and whether it’ll ever be given space to meet on Capitol Hill — remains to be seen, as supportive lawmakers huddle in Washington this week to try and gain support for writing it into the rulebook for the next Congress. Ultimately, it will be that committee that fleshes out what a Green New Deal looks like. But the proposal itself, American history, and existing research give us a sense for what all it might look like in practice.

The plan itself — or rather, the plan to make the plan — lays out seven goals, starting with generating 100 percent of power in the U.S. from renewable sources and updating the country’s power grid. [Continue reading…]

The real cost of the 2008 financial crisis

John Cassidy writes:

September 15th marks the tenth anniversary of the demise of the investment bank Lehman Brothers, which presaged the biggest financial crisis and deepest economic recession since the nineteen-thirties. After Lehman filed for bankruptcy, and great swaths of the markets froze, it looked as if many other major financial institutions would also collapse. On September 18, 2008, Hank Paulson, the Secretary of the Treasury, and Ben Bernanke, the chairman of the Federal Reserve, went to Capitol Hill and told congressional leaders that if they didn’t authorize a seven-hundred-billion-dollar bank bailout the financial system would implode. Some Republicans reluctantly set aside their reservations. The bailout bill passed. The panic on Wall Street abated. And then what?

The standard narrative is that the rescue operation succeeded in stabilizing the financial system. The U.S. economy rebounded, spurred by a fiscal stimulus that the Obama Administration pushed through Congress in February, 2009. When the stimulus started to run down, the Fed gave the economy another boost by buying vast quantities of bonds, a policy known as quantitative easing. Eventually, the big banks, prodded by the regulators and by Congress, reformed themselves to prevent a recurrence of what happened in 2008, notably by increasing the amount of capital they hold in reserve to deal with unexpected contingencies. This is the basic story that Paulson, Bernanke, and Tim Geithner, who was the Treasury Secretary during the Obama Administration, told in their respective memoirs. It was given an academic imprimatur by books like Daniel Drezner’s “The System Worked: How the World Stopped Another Great Depression,” which came out in 2014.

This history is, on its own terms, perfectly accurate. In the early nineteen-thirties, when the authorities allowed thousands of banks to collapse, the unemployment rate soared to almost twenty-five per cent, and soup kitchens and shantytowns sprang up across the country. The aftermath of the 2008 crisis saw plenty of hardship—millions of Americans lost their homes to mortgage foreclosures, and by the summer of 2010 the jobless rate had risen to almost ten per cent—but nothing of comparable scale. Today, the unemployment rate has fallen all the way to 3.9 per cent.

There is much more to the story, though, than this uplifting Washington-based narrative. In “Crashed: How a Decade of Financial Crises Changed the World,” the Columbia economic historian Adam Tooze points out that we are still living with the consequences of 2008, including the political ones. Using taxpayers’ money to bail out greedy and incompetent bankers was intrinsically political. So was quantitative easing, a tactic that other central banks also adopted, following the Fed’s lead. It worked primarily by boosting the price of financial assets that were mostly owned by rich people.

As wages and incomes continued to languish, the rescue effort generated a populist backlash on both sides of the Atlantic. Austerity policies, especially in Europe, added another dark twist to the process of political polarization. As a result, Tooze writes, the “financial and economic crisis of 2007-2012 morphed between 2013 and 2017 into a comprehensive political and geopolitical crisis of the post–cold war order”—one that helped put Donald Trump in the White House and brought right-wing nationalist parties to positions of power in many parts of Europe. “Things could be worse, of course,” Tooze notes. “A ten-year anniversary of 1929 would have been published in 1939. We are not there, at least not yet. But this is undoubtedly a moment more uncomfortable and disconcerting than could have been imagined before the crisis began.” [Continue reading…]

Conflict reigns over the history and origins of money

Bruce Bower writes:

Wherever you go, money talks. And it has for a long time.

Sadly, though, money has been mum about its origins. For such a central element of our lives, money’s ancient roots and the reasons for its invention are unclear.

As cryptocurrencies such as Bitcoin multiply into a flock of digital apparitions, researchers are still battling over how and where money came to be. And some draw fascinating parallels between the latest, buzzworthy cryptocurrencies, which require only a virtual wallet, and a type of money developed by one Micronesian island community that wouldn’t fit in anyone’s wallet, pocket or purse.

When it comes to money’s origins, though, conflict reigns. Economists have held one view of money’s origins for hundreds of years. But a growing number of anthropologists and archaeologists, holding a revisionist view, say that economists’
standard story is bankrupt.

Economists and revisionists alike agree that an object defined as money works in four ways: First, it serves as a means for exchanging goods and services. Currency enables payment of debts. It represents a general measure of value, making it possible to calculate prices of all sorts of items. And, finally, money can be stored as a wealth reserve.

From there, the two groups split. Mainstream economists assume that bartering of goods and services inspired money’s invention. Anthropologists and archaeologists contend that early states invented currency as a means of debt payment.

“Much academic work assumes that [monetary systems] arose in nation-states within the last 200 to 400 years,” says sociocultural anthropologist Daniel Souleles of Copenhagen Business School in Frederiksberg. But financialized transactions and debt show up in lots of places much further back in time.

Recent research from the Americas adds new questions to the debate. These investigations suggest that money independently appeared for different reasons and assumed different tangible forms in many parts of the world, starting thousands of years ago. [Continue reading…]