Comments on: Why hasn’t the 2008-14 shock produced anything like the New Deal?

By: Don Gately

Don Gately — Thu, 06 Feb 2014 13:33:00 +0000

The biggest issue I have with this debate in general is the loose use of the word “inequality” – you’re never going to have coherent responses to incoherent concepts and whilst I wouldn’t expect the word to be abused in this blog it there are too many people out there trying to influence the debate using very different definitions of the word and with very different agendas.

By: Gabriel

Gabriel — Mon, 03 Feb 2014 17:16:11 +0000

It seems like the biggest problem isn’t convincing elites in any particular country to adopt policies that favor radical redistribution (not to diminish those challenges, of course) but how to counter the flight of capital from those countries which do adopt redistributive policies to those which do not. The incentives for defection (the ‘Depardieu defection’?) rise proportionately to the amount of total potential capital flight: the more states that agree to radically redistributive policies, the greater the potential gains for any individual defector. Even when Nicholas’ day of reckoning comes, this defection problem remains. The growing wealth of ’emerging markets’ may even make the problem worse, creating more legitimate destinations for large-scale movements of capital who become potential defectors. Can the defection problem be overcome by a global network of citizens demanding reform? Do we need some kind of mechanism for the global governance of capital? Are there alternatives to those two? I would say that there’s an important role there for Oxfam and other international NGOs as being able to advocate in many countries simultaneously. If only to prevent a Russian remake of ‘Le dernier metro’.

By: Nicholas Shaxson

Nicholas Shaxson — Fri, 24 Jan 2014 07:56:47 +0000

“Ha-Joon Chang thinks” Britiain is under the financiers’ spell? He’s right, of course, but better to say “pretty much everyone knows.”
I would go further: the spell is a curse. To be precise, a “Finance Curse,” whose symptoms and causes overlap heavily with the better-known “Resource Curse” that afflicts mineral-rich countries. Read about the Finance Curse here.
http://www.taxjustice.net/topics/finance-sector/finance-curse/

By: Richard Gower

Richard Gower — Thu, 23 Jan 2014 11:13:19 +0000

Hi Duncan (long time!) – thought-provoking blog. Reflecting on it, I think that in many cases we do know at least part of the solution, but the problem is that it doesn’t appear achievable: the power dynamics just look impossible! In these cases what may ultimately be required is action to change social norms from the grassroots up – movement building I suppose – to create the conditions where political elites have the manoeuvrability and space to act. But this is inherently unattractive in an NGO culture often focused on relatively short-term victories. Amplifying the problem -as you say above – is definitely part of movement-building, but so is amplifying hope: highlighting what’s working elsewhere and how those involved came up with the idea, to inspire other innovators to come up with their own initiatives.
Thanks for the spur to reflection!

By: Ed Cairns

Ed Cairns — Thu, 23 Jan 2014 10:59:29 +0000

You’ve hit on something there, Duncan. In the US, European and Asian examples from history, inequality was seen as dangerous, a threat to elites and wider stability. By and large, it isn’t seen that way now. But surely it should be. What did the new President of the Central African Republic, Catherine Samba-Panza, say on Tuesday? That “when one section of the population see that it doesn’t have the same opportunity to access economic resources as others, that creates frustration, identify introversion and an explosion.” And what turned the Syria that nobody called ‘fragile’ into what we see now? Well surely a mixture of very many combustible factors, but one of which was probably the rising inequality between different areas. In short, inequality is dangerous as well as morally contemptible – as Frances Stewart’s research in other regions showed a few years ago. Remembering that is surely part of the answer to reshaping the global elite’s understanding of self-interest….

By: Nicholas Colloff

Nicholas Colloff — Thu, 23 Jan 2014 10:22:16 +0000

I propose, whilst weaving your straws, some of which might contribute to change, wait for the next financial shock. It is true that a radical loosening of monetary policy rode out the last wave but at the cost of displacement – the public assumption of debt (that, deficit reduction aside, most of which will prove unredeemable)- and adding to the sheer volume of money. The next shock (or one after) will overwhelm the system (that is inherently unstable – too much money chasing too little opportunity in a finite world) and we will have to adopt radical solutions. Radical debt forgiveness, exchange controls, negative interest etc. It will be horribly messy but that is a result of missing our opportunity this time round.