Category: Markets

Naomi Klein Interviewed about her new climate politics book

Naomi Klein, who has written extensively about global political issues was recently interviewed on Democracy Now about her new book This Changes Everything: Capitalism versus the Climate. This is one of those books whose content is easily identifiable from the title. In essence, Klein posits that capitalism, at least in its current form as championed by right-wing think tanks world-wide (but especially in the United States of America), is inherently at odds with protecting the climate. This is a sentiment articulated by some of you during our session earlier this week. There can’t simply be tinkering at the margins. The protection of the global environment requires a radical re-thinking of the relationships amongst, civil society, the market, and the state. [Incidentally, Klein’s book promotion tour will hit Vancouver on October 26th (at UBC).]

Here’s part of the transcript from the interview, which you can view below:

NAOMI KLEIN…So the argument I’m making is really quite a hopeful one. I think if we do respond to climate change with the decisiveness that the scientist[s] are telling us we do, if we respond in line with science, we have a chance to remake our economy, the global economy, for the better…

AMY GOODMAN: Naomi Klein, in your book, This Changes Everything, you… talk about a number of these [right-wing think tanks] groups. You open with them in a chapter called “The Right is Right.”

NAOMI KLEIN: OK, well, let’s be clear: They are not right about the science. They’re wrong about the science. But I think what the right understands, and it’s important to understand, that the climate change denier movement in the United States is entirely a product of the right-wing think tank infrastructure…The Heartland Institute, which people mostly only know in terms of the fact that it hosts these annual conferences of climate change skeptics or deniers, it’s important to know that the Heartland Institute is first and foremost a free market think tank. It’s not a scientific organization. It is—just like the other ones I listed, it exists to push the ideology, the familiar ideology, of deregulation, privatization, cuts to government spending, and sort of triumphant free market, you know, backed with enormous corporate funding, because that’s a very, very profitable ideology.

And when I interviewed the head of the Heartland Institute, Joe Bast, for this project, he was quite open that it wasn’t that he found a problem with the science first. He said, when he looked at the science and listened to what scientists were saying about how much we need to cut our emissions, he realized that climate change could be—if it were true, it would justify huge amounts of government regulation, which he politically opposes. And so, he said, “So then we looked at the science, and we found these problems,” right? So the issue is, they understand that if the science is true, their whole ideological project falls apart, because, as I said, you can’t respond to a crisis this big, that involves transforming the foundation of our economy—our economy was built on fossil fuels, it is still fueled by fossil fuels. The idea in this—we hear this from a lot of liberal environmental groups, that we can change completely painlessly—just change your light bulbs, or just a gentle market mechanism, tax and relax, no problem. This is what they understand well, that in fact it requires transformative change. That change is abhorrent to them…

…So when I say “the right is right,” I think that they have a better grasp on the political implications of the science, of what it means to how we need to change our economy and what the role of the public sphere is and the role of collective action is, better than some of those sort of big, slick, centrist green groups that are constantly trying to sell climate action as something entirely reconcilable with a booming capitalist economy. And we’re always hearing about green growth and how it’s great for business. You know, yeah, you can—there will be markets in green energy and so on, but other businesses are going to have to contract in ways that requires that strong intervention.

‘Thick Description’ and Qualitative Research Analysis

In Chapter 8 of Bryman, Beel, and Teevan, the authors discuss qualitative research methods and how to do qualitative research. In a subsection entitled Alternative Criteria for Evaluating Qualitative Research, the authors reference Lincoln and Guba’s thoughts on how to assess the reliability, validity, and objectivity of qualitative research. Lincoln and Guba argue that these well-known criteria (which developed from the need to evaluate quantitative research) do not transfer well to qualitative research. Instead, they argue for evaluative criteria such as credibility, transferability, and objectivity.

Saharan Caravan Routes
Saharan Caravan Routes–The dotted red lines in the above map are caravan routes connecting the various countries of North Africa including Egypt, Libya, Algeria, Morocco, Mali, Niger and Chad. Many of the main desert pistes and tracks of today were originally camel caravan routes. (What do the green, yellow, and brown represent?)

Transferability is the extent to which qualitative research ‘holds in some other context’ (the quants reading this will immediately realize that this is analogous to the concept of the ‘generalizability of results’ in the quantitative realm). The authors argue that whether qualitative research fulfills this criterion is not a theoretical, but an empirical issue. Moreover, they argue that rather than worrying about transferability, qualitative researchers should produce ‘thick descriptions’ of phenomena. The term thick description is most closely associated with the anthropologist Clifford Geertz (and his work in Bali). Thick description can be defined as:

the detailed accounts of a social setting or people’s experiences that can form the basis for general statements about a culture and its significance (meaning) in people’s lives.

Compare this account (thick description) by Geertz of the caravan trades in Morocco at the turn of the 20th century to how a quantitative researcher may explain the same institution:

In the narrow sense, a zettata (from the Berber TAZETTAT, ‘a small piece of cloth’) is a passage toll, a sum paid to a local power…for protection when crossing localities where he is such a power. But in fact it is, or more properly was, rather more than a mere payment. It was part of a whole complex of moral rituals, customs with the force of law and the weight of sanctity—centering around the guest-host, client-patron, petitioner-petitioned, exile-protector, suppliant-divinity relations—all of which are somehow of a package in rural Morocco. Entering the tribal world physically, the outreaching trader (or at least his agents) had also to enter it culturally.

Despite the vast variety of particular forms through which they manifest themselves, the characteristics of protection in tbe Berber societies of the High and Middle Atlas are clear and constant. Protection is personal, unqualified, explicit, and conceived of as the dressing of one man in the reputation of another. The reputation may be political, moral, spiritual, or even idiosyncratic, or, often enough, all four at once. But the essential transaction is that a man who counts ‘stands up and says’ (quam wa qal, as the classical tag bas it) to those to whom he counts: ‘this man is mine; harm him and you insult me; insult me and you will answer for it.’ Benediction (the famous baraka),hospitality, sanctuary, and safe passage are alike in this: they rest on the perhaps somewhat paradoxical notion that though personal identity is radically individual in both its roots and its expressions, it is not incapable of being stamped onto tbe self of someone else. (Quoted in North (1991) Journal of Economic Perspectives, 5:1 p. 104.

The Trilemma of International Finance

In IS210, we will be reading about domestic political economy next week. Understanding the role of state and market, politics and economics, we can learn about what causes some countries’s economies to grow quite rapidly and other countries’ economies to grow more slowly. We’ll look at the role of domestic institutions and policy choices as key root causes in economic development. [How does this contrast with Inglehart’s arguments, or Weber’s idea of the ‘Protestant work ethic?’] Increasingly, though, our ever more globalized and interdependent world economy provides domestic economies with opportunities and threats that didn’t exist to nearly this extent even 50 years ago. We’ll look at economist N. Gregory Mankiw’s New York Times editorial piece on the “trilemma of international finance.”

Have a look at this Frontline excerpt on the Asian financial crisis of 1997 and the role that fixed exchange rates played:

Development and Underdevelopment–the Commanding Heights

We addressed the topic of development and underdevelopment in POLI 1100 this week. Amongst the many issues covered, we started to explore some of the alleged causes of economic growth and development. Why is there still such disparity in income and economic growth around the world, not only between countries, but within? Why have countries in the global “South” lagged behind, for the most part, their counterparts in the global “North”? There are various answers to this question and we addressed a couple of them in class. I showed clips from a fantastic documentary series put together by PBS, called (and based on the book of the same name) The Commanding Heights. All the information you’ll need is at the PBS website. Fortunately, each of the three 2-hour episodes has also been uploaded (in its entirety) to the Internet. From the narration at the beginning of the first episode, we learn that

This is the story of how the new global economy was born. A century-long battle as to which would control the commanding heights of the world’s economies–governments or markets.

I encourage you to watch all three episodes.

 

Global Debt Crisis and Relief

The issue of the global debt crisis–and particularly the onerous debt levels of developing world (“Southern”) countries–was a topic that we covered in POLI 1100 today. It will allow me to combine two class topics–issues pertaining development and underdevelopment, and interest groups (NGOs)–into one blog post. The interest group, Global Issues, is dedicated to analyzing “social, political, economic, and environmental issues that affect us all” and has a section on debt relief for the developing world. Here are some facts and figures related to the scale of the debt crisis in the developing world:

Consider the following:

  • In 1970, the world’s poorest countries (roughly 60 countries classified as low-income by the World Bank), owed $25 billion in debt.
  • By 2002, this was $523 billion
  • For Africa,
    • In 1970, it was just under $11 billion
    • By 2002, that was over half, to $295 billion
  • Debts owed to the multilateral institutions such as the IMF and World Bank is currently around $153 billion
  • For the poorest countries debts to multilateral institutions is around $70 billion.

$550 billion has been paid in both principal and interest over the last three decades, on $540bn of loans, and yet there is still a $523 billion dollar debt burden.

Here are some remarks by Professor Susan George on how to tackle the debt crisis. Money quote:

…there is no level of human suffering, which in and of itself, is going to change policy. The only way policy changes is because people demand it, and in this case, it has to be the people of the North, because the people of the South have very little political clout.

What is the link between Globalization and Poverty?

In my previous post, I noted that the narrator of the Globalization is Good documentary claimed that there was a strong correlation between how globalized a country is and poverty. Specifically, those countries that are globalized are likely to have less poverty. How does this claim stand up to empirical scrutiny? Well, one answer comes from the National Bureau of Economic Research (NBER) in Cambridge, Massachusetts.

“The evidence strongly suggests that export growth and incoming foreign investment have reduced poverty everywhere from Mexico to India to Poland. Yet at the same time currency crises can cripple the poor.”

Does globalization, as its advocates maintain, help spread the wealth? Or, as its critics charge, does globalization hurt the poor? In a new book titled Globalization and Poverty, edited by NBER Research Associate Ann Harrison, 15 economists consider these and other questions. In Globalization and Poverty (NBER Working Paper No. 12347), Harrison summarizes many of the findings in the book. Her central conclusion is that the poor will indeed benefit from globalization if the appropriate complementary policies and institutions are in place.

Harrison first notes that most of the evidence on the links between globalization and poverty is indirect. To be sure, as developing countries have become increasingly integrated into the world trading system over the past 20 years, world poverty rates have steadily fallen. Yet little evidence exists to show a clear-cut cause-and-effect relationship between these two phenomena.

Many of the studies in Globalization and Poverty in fact suggest that globalization has been associated with rising inequality, and that the poor do not always share in the gains from trade. Other themes emerge from the book. One is that the poor in countries with an abundance of unskilled labor do not always gain from trade reform. Another is that the poor are more likely to share in the gains from globalization when workers enjoy maximum mobility, especially from contracting economic sectors into expanding sectors (India and Colombia). Gains likewise arise when poor farmers have access to credit and technical know-how (Zambia), when poor farmers have such social safety nets as income support (Mexico) and when food aid is well targeted (Ethiopia).

The evidence strongly suggests that export growth and incoming foreign investment have reduced poverty everywhere from Mexico to India to Poland. Yet at the same time currency crises can cripple the poor. In Indonesia, poverty rates increased by at least 50 percent after the 1997 currency crisis in that country, and the poor in Mexico have yet to recover from the pummeling of the peso in 1995.

Without doubt, Harrison asserts, globalization produces both winners and losers among the poor. In Mexico, for example, small and medium corn growers saw their incomes halved in the 1990s, while larger corn growers prospered. In other countries, poor workers in exporting sectors or in sectors with foreign investment gained from trade and investment reforms, while poverty rates increased in previously protected areas that were exposed to import competition. Even within a country, a trade reform may hurt rural agricultural producers and benefit rural or urban consumers of those farmers’ products.

The relationship between globalization and poverty is complex, Harrison acknowledges, yet she says that a number of persuasive conclusions may be drawn from the studies in Globalization and Poverty. One conclusion is that the relationship depends not just on trade or financial globalization but on the interaction of globalization with the rest of the economic environment: investments in human capital and infrastructure, promotion of credit and technical assistance to farmers, worthy institutions and governance, and macroeconomic stability, including flexible exchange rates. The existence of such conditions, Harrison writes, is emerging as a critical theme for multilateral institutions like the World Bank.

Globalization is good…or is it?

Is globalization good for those in developing countries? What is the link between globalization and poverty? What about globalization and democracy? Today in IS210 we watched a documentary in which the narrator argued that more globalization is good for the poor in developing countries. He argued that countries that have (and are) globalizing, such as Taiwan and Vietnam,  have become richer, more democratic, and poverty levels have plummeted. On the other hand, countries that haven’t democratized, regardless of whether this is the result of domestic or external policy, have done poorly. They’re less democratic and poorer than they otherwise could be.

Here’s a link to the documentary, and some questions that you may want to think about:

  1. Has globalization been beneficial or detrimental to Taiwan’s economic development? Explain.
  2. What role, according to the narrator, do multi-national corporations (MNCs) play in globalization? Should LDCs embrace the arrival of MNCs into their economies? How can the example of Vietnam inform our answers to these questions? Is there a link between MNCs and worker productivity?
  3. According to the narrator, what was the role of sweatshops in the development of Taiwan’s economy? Were they necessary?
  4. What is the link between globalization and democracy? What is the process that causes this empirical link?
  5. What is the reason for Africa’s slow growth, according to the narrator? Which of Collier and Gunning’s [from Chapter 9 of Essential Readings) four categories would apply? How does the situation of Kenya inform our answers to this question?
  6. What is the e ect of developing countries trade policies on economic outcomes in Kenya and in other parts of the developing world?

China and Civil Society

This week in IS 210 we addressed the concept of civil society–its institutions, and the relationships thereof with the state and market sectors. As part of today’s lecture, we viewed an excerpt of a video recording of a roundtable discussion about China and civil society. In a highly informative presentation, George Mason University (Fairfax, VA) research professor, Carol Lee Hamrin, assessed the changes in Chinese civil society over the last few decades. As the power and reach of the Chinese party-state recedes it has opened up room for the increasing independence of civil society institutions and (especially) the commercialisation of the Chinese economy.

You can view the whole video here.

Theories of Ethnic Identity Formation and Ethnic Violence & Ivory Coast

In IS 309 this evening, we assessed the strengths and weaknesses of three competing theories of ethnic identity (and ethnic violence)–constructivism, primordialism, and instrumentalism. We read the following:

  • Fearon, James D. and David D. Laitin. 2000. Review: Violence and the Social Construction of
    Ethnic Identity,” International Organization, 54:4, pp. 845-877
  • Harvey, Frank P. 2000. Primordialism, Evolutionary Theory and Ethnic Violence in the Balkans:
    Opportunities and Constraints for Theory and Policy,” Canadian Journal of Political Science, 33:1,
    pp. 37-65
  • Collett, Moya. 2006. Ivoirian identity constructions: ethnicity and nationalism in the prelude to
    civil war,” Nations and Nationalism, 12(4), 613-629
  • Kaplan, Robert. D. 1993. Balkan Ghosts: A Journey through history Part I and One Chapter from each of Parts II, III, and IV.
  • Hechter, Michael. 1995. Explaining Nationalist Violence,” Nations and Nationalism, Vol 1(1), 53-68.

    • We then viewed a video on the breakdown of political life in the Ivory Coast and the descent of that once relatively prosperous west African state into civil war. The civil war was characterised as a battle between the “Muslim-populated north and the Christian-dominated south.” How accurate is this characterisation of the ethnic character of Cote D’Ivoire’s civil war?

    http://www.youtube.com/watch?v=UOjgiPMs7nc

    For information about the current political situation, in the wake of the refusal of former(?) President Laurent Gbagbo to acknowledge having lost power in elections held several weeks ago, watch these.

    ICG Report–Diamonds and the Central African Republic (CAR)

    The International Crisis Group (ICG) has just released a new report on the influence of diamonds on the political situation in the Central African Republic (CAR). We’ve read various papers on the link between resource wealth (“lootable resources”) and political outcomes, such as regime type and economic outcomes. This report analyses the link between the presence of large stores of diamond wealth in CAR, the level of political instability (it’s essentially a failing state) and the existence of endemic conflict.  From the executive summary of the report:

    In the diamond mines of the Central African Republic (CAR), extreme poverty and armed conflict put thousands of lives in danger. President François Bozizé keeps tight control of the diamond sector to enrich and empower his own ethnic group but does little to alleviate the poverty that drives informal miners to dig in perilous conditions. Stringent export taxes incentivise smuggling that the mining authorities are too few and too corrupt to stop. These factors combined – a parasitic state, poverty and largely unchecked crime – move jealous factions to launch rebellions and enable armed groups to collect new recruits and profit from mining and selling diamonds illegally. To ensure diamonds fuel development not bloodshed, root and branch reform of the sector must become a core priority of the country’s peacebuilding strategy.

    Nature scattered diamonds liberally over the CAR, but since colonial times foreign entrepreneurs and grasping regimes have benefited from the precious stones more than the Central African people. Mining companies have repeatedly tried to extract diamonds on an industrial scale and largely failed because the deposits are alluvial, spread thinly across two large river systems. Instead, an estimated 80,000-100,000 mostly unlicensed miners dig with picks and shovels for daily rations and the chance of striking it lucky. Middlemen, mostly West Africans, buy at meagre prices and sell at a profit to exporting companies. The government lacks both the institutional capacity to govern this dispersed, transient production chain and the will to invest diamond revenues in the long-term growth of mining communities.

    Chronic state fragility has ingrained in the political elite a winner-takes-all political culture and a preference for short-term gain. The French ransacked their colony of its natural resources, and successive rulers have treated power as licence to loot. Jean-Bédel Bokassa, the CAR’s one-time “emperor”, created a monopoly on diamond exports, and his personal gifts to French President Giscard d’Estaing, intended to seal their friendship, became symbols of imperial excess. Ange-Félix Patassé saw nothing wrong in using his presidency to pursue business interests and openly ran his own diamond mining company. Bozizé is more circumspect. His regime maintains tight control of mining revenues by means of a strict legal and fiscal framework and centralised, opaque management.

    The full report can be accessed here. Here is a Al-Jazeera English news report on the situation in CAR.