10 things we missed or got wrong 5 years ago at the height of the credit crunch and food/fuel spike Alex Evans
This summer will mark five years since 2008, the year of both the first flush of the global financial crisis, and of the peak of the combined food and fuel spike.
As David Steven and I have observed in various papers, the last decade was bookended by shocks – 9/11 at one end, and these two at the other. And while the resource spike and the credit crunch lacked the visual vividness of September 11, they were arguably just as significant in the way that they shook assumptions about the stability or direction of globalisation.
But it’s also intesting to look back now at that strange year, and reflect on how many of the initial fears, hopes and assumptions about the twin crises have been proved wrong with the benefit of five years’ hindsight – as well as various shifts that have taken place since 2008 that no-one foresaw at the time. Here are ten things that lots of us (well, I, anyway) got wrong or missed altogether back in 2008 – adapted from a futures presentation I gave to Oxfam last week.March 22, 2013 at 12:01 pm | More on Climate and resource scarcity, Conflict and security, Economics and development, Global system, Influence and networks |
There’s one measure of inequality that gets all the attention – the Gini index.
The Gini was developed in the early 1900s – in fact about 100 years ago – by Italian Statistician, Corrado Gini (see pic).
A century later it may be time for a rethink on measuring inequality.
Why?March 21, 2013 at 5:17 pm | More on Cooperation and coherence, Economics and development, Global system |
Last summer Philip Stephens, the FT’s chief political commentator, wrote the following
The High Court is witnessing an expensive legal battle between Oleg Deripaska and Michael Cherney. The two made fortunes in the wild west privatisation scramble after the fall of the Soviet Union. We have heard lurid tales of organised crime and extortion. Mr Cherney says Mr Deripaska owes him hundreds of millions of dollars. An estimated 60 per cent-plus of the case load of the High Court’s commercial division now comes from Russia and eastern Europe.
His point, and one made by many others in Westminster and Whitehall, is that ‘the capital is a constant reminder of how unequally the bounty of globalisation has been shared’. As London became the financial hub of the world so too did the city attract those from the shadows of globalisation. And boy, did they come… by the Home Office’s reckoning there are 38,000 individuals (across 6,000 groups) involved in organised crime that impacts on the UK.
With that in mind 2013 is the year the Government must act. The Home Secretary gets this. Home Officials talk about a new found determination to tackle organised crime. There are plenty of reasons why. Following the sucess of the Olympics, there is a quiet confidence among officials that while terroism remains a real and present danger, assurance levels have never been higher. It means the Home Office can address a portfolio of risks – rather than focus solely on a single threat to the UK.
The following is from a piece I wrote for the RUSI website:
EUROPOL, a European Union Agency run by a Briton and heavily reliant on British intelligence, has published its annual Serious and Organised Crime Threat Assessment (SOCTA). The assessment highlights the scale of the threat from organised crime to individuals, communities and businesses across Europe. Of particular concern to EUROPOL are ‘facilitated illegal immigration, trafficking in human beings, synthetic drugs and poly-drug trafficking, Missing Trader Intra-Community (MTIC) fraud, the production and distribution of counterfeited goods, cybercrime and money laundering.’ These crimes, in EUROPOL’s view, require concerted action by EU member states – not least by the British Government.
You can read the rest of the article hereMarch 21, 2013 at 4:02 pm | More on Global system, UK |
What do Obama and Bono have in common?
Both have proposed that the world should seek to end extreme poverty over the next twenty years or so.
Are they mad or deluded? Actually, no. Under certain conditions it is feasible (and the numbers by various economic growth and inequality scenarios are here).
The idea of an end to extreme poverty is part of a broader discussion on the next generation of UN global poverty goals. There’s plenty on the subject on Global Dashboard from Claire, David and Alex and others.
The current set of goals, the Millennium Development Goals (MDGs), will expire in 2015 (here’s a brief history).
The MDGs aimed to halve income poverty and hunger and to reduce other forms of poverty so the big question for the UN and others is what sort of global goals are after 2015? (assuming you think global goals are good which not all do).
To answer that question we need first to know a bit about progress towards the current – 2015 – goals.
Charles Kenny and I crunched the numbers back in 2011 and concluded, in short, that the goals had contributed in notably more aid for the poorest countries and faster progress on poverty reduction in some areas – notably heath related, MDGs, 4 and 6.
Of course, quite a lot of the progress would have happened even if there hadn’t been any global goals. It seems unlikely, for example, that the MDGs had much to do with China’s and India’s and other emerging economies’ incredible economic take-off.
So, what might be feasible in terms of poverty reduction in the next, say 15-20 years?
One idea that has evolved is that the MDGs were about halving global poverty and reducing other aspects of poverty so the post-MDGs should be about ‘finishing the job’ – meaning ‘getting to zero poverty’, to echo a World Economic Forum report on the matter.
Here we conclude too that it is entirely feasible to get close to ending extreme poverty – as measured by the World Bank at $1.25 per person per day – by around 2030 or so – but under certain conditions which I’ll come to in a moment.March 5, 2013 at 6:33 pm | More on Cooperation and coherence, Economics and development, Global system |
This is your last drink for tonight, understand?
This was the week the UN stopped being fun. To start with, the US is trying to stop diplomats turning up at budget debates drunk:
The U.S. ambassador for management and reform at the United Nations, Joseph Torsella, scolded his U.N. colleagues today for excessive drinking during delicate budget negotiations.
The unusual censure reflected lingering American frustration with its counterparts’ conduct in budget negotiations in December, which one U.N.-based diplomat compared to a circus.
“There has always been a good and responsible tradition of a bit of alcohol improving a negotiation, but we’re not talking about a delegate having a nip at the bar,” said the diplomat who recalled one G-77 diplomat fell sick from too much alcohol.
As the United States sought to rally support for a proposal to freeze U.N. staff pay in December, it found that key negotiating partners, particularly delegates from the Group of 77 developing countries, were not showing up for meetings. When they did arrive, they had often been drinking.
“As for the conduct of negotiations, we make the modest proposal that the negotiation rooms should in future be an inebriation-free zone,” Torsella said in a meeting of the U.N. membership’s budget committee, known as the Fifth Committee. “While my government is truly grateful for the strategic opportunities presented by some recent practices, lets save the champagne for toasting the successful end of the session, and do some credit to the Fifth Committee’s reputation in the process.”
Meanwhile UN officials have been going after weed…
A United Nations-based drug agency urged the United States government on Tuesday to challenge the legalization of marijuana for recreational use in Colorado and Washington, saying the state laws violate international drug treaties.
The International Narcotics Control Board made its appeal in an annual drug report. It called on Washington, D.C., to act to “ensure full compliance with the international drug control treaties on its entire territory.”
When I was young, naive and ignorant both of humanity’s complexity and my own limitations, I believed I would one day save the world. Once I reached adulthood, I thought, the willpower and abilities I possessed would be sufficient to wipe out poverty and put an end to conflict.
Then I grew up. I slowly realised that the world was not for saving, much less by one individual, and least of all by me. As I studied history, I realised too that the only people who still believed they could save the world having reached adulthood were dictators or madmen, and that their efforts always ended in failure.
It turns out, however, that I grew cynical too soon, and that in reality it is possible for one man to save the world, or at least a large part of it. Tony Blair, the former British prime minister, believes that he has singlehandedly rescued Africa from poverty and underdevelopment. In an article on the Guardian website which must be either a push for a Nobel Prize or a pitch for a job at the UN or World Bank, he argues that all of the recent socio-economic improvements that have taken place in Africa resulted from his own focus on increasing international aid (he has nothing to say about the many African countries that have yet to see any improvement).
The beginning of Africa’s salvation, Blair claims, came at the Gleneagles G8 summit which Britain hosted in 2005. His role in the summit was crucial for Africa. As he reports:
Summits with genuine, long-lasting outcomes are rare. But as we started planning for the Gleneagles G8 meeting in 2005, I saw that it could be one of these rare ones – a summit about changing the world…
I decided to put Africa at the top of the agenda for Gleneagles…And it worked. Today, the positive legacy of that summit is still being felt across Africa: aid was doubled and developing world debt dropped.
Now an increase in aid is not, of course, an end in itself. Large quantities of aid given to Africa over the decades have been squandered on entrenching corrupt elites or padding the overseas bank accounts of dictators, with little impact on the quality of life of ordinary Africans. Gleneagles, however, not only increased the quantity of aid; it apparently dramatically increased its effectiveness. Here is Blair again:
I want to answer the aid sceptics – those who think aid doesn’t work or is all swallowed up in corruption. Look at the facts. In Africa since 2005, the rate of children dying before their fifth birthday has fallen by 18%. The proportion of people in Africa living in extreme poverty is down by nearly 10%.
It is undeniable that the latter two sentences are facts, but Blair offers no evidence that they have anything to do with an increase in aid. That they might have had more to do with increased investment in and trade with Africa by China, remittances and ideas sent from the diaspora, high commodity prices, or anything Africans living in Africa might have done is a possibility Blair is either unaware of or, because it does not fit with his messianic self-image, has no interest in highlighting. He even takes the credit for foreign investment. He writes:
Africa is among the fastest-growing regions in the world. The Gleneagles agreement can claim some credit for this; bilateral aid for trade to sub-Saharan Africa has almost doubled between 2005 and 2011. Foreign direct investment in the continent has increased by 87% in the past 10 years.
Again, no evidence is presented linking aid to fast growth – it is merely hoped that the juxtaposition of the two things will convince the unwary reader. Even Blair’s buddy Bob Geldof doesn’t have the chutzpah to attribute China’s growing influence in the continent to Gleneagles, admitting in an otherwise tub-thumping piece today (in which he refers to Africans as ‘the people you kept alive all those 30 years ago’ and to Africa’s success as ‘Blair’s lasting legacy’) that trade was not discussed at the Scottish summit. Blair, though, is in no doubt. ‘The last decade of development progress was defined by aid,’ he announces.
Blair does admit that despite his efforts Africa is not yet a utopia, and that improvements can still be made. Fortunately, he has the answers for these too. ‘After leaving office,’ he writes, ‘I set up the Africa Governance Initiative to continue my work on that forgotten half.’ The forgotten half refers to ‘the ability of governments in developing countries to get things done.’ In Blair’s world aid alone, or at least the aid he generated, has rescued Africa – the region’s governments have had nothing to do with it and like their people, who have thrived only since he decided to help them, can do little without his assistance.
Blair has one final piece of evidence, in case we remain unpersuaded that he is Africa’s saviour. ‘The very fact that people are still talking about Gleneagles eight years on shows that we were right to be ambitious, to change the debate.’ he writes. We will have to take his word for it that Gleneagles remains the talk of the town, and the argument that noise proves success is at least no flimsier than some of his other contentions. It’s certainly strong enough for the image-conscious Blair, who concludes his article by proclaiming that ‘the journey from Gleneagles to long-lasting development in Africa is not over [there was, it seems, no journey before the summit]. But Africa is on the move and if we keep going on the whole Gleneagles agenda…the continent will be transformed. So I’m proud to say that Gleneagles has turned out to be that rare thing – a summit that matters.’ If anywhere else in the world needs rescuing, they know who to call.March 4, 2013 at 11:27 am | More on Africa, Economics and development |
Or so you might believe from your RSS feeds this morning. The Guardian, BBC, FT and others are all carrying the story that (as the Guardian has it), “David Cameron gives green light for aid cash to go on military”. Various NGO campaigners have predictably gone, well, ballistic.
But actually… both David Cameron’s actual remarks, and the background briefing subsequently given to the press, have stressed that all this would happen within existing rules on what counts as aid, i.e. the OECD DAC definition of ODA.
These rules are abundantly clear about what can and can’t count as ODA in the security and conflict domain. First and foremost, it counts as aid only if it’s “administered with the promotion of the economic development and welfare of developing countries as its main objective”.
This principle is applied in a pretty conservative way, too. The rules are explicit, for instance, that activities to combat terrorism are “not reportable as ODA, as they generally target perceived threats to donor, as much as to recipient countries”; given the effect on development of Boko Haram or AQIM in the Sahel, you could well argue that that’s actually too restrictive.
What about peacekeeping? Bottom line: some of it’s allowed, but not “the enforcement aspects”. The sort of stuff you can include from peacekeeping, on the other hand, is stuff like human rights, election monitoring, rehabilitation of demobilised soldiers, advice on economic stabilisation, or mine removal. In other words, the sort of stuff that DFID already funds loads of, and rightly so. Spending on “military services and equipment” is only allowed if it’s being used for humanitarian assistance or development services.
Against this backdrop, people taking to Twitter and the airwaves to denounce the diversion of aid from schools to soldiers have either not got their facts right, or are being disingenuous. (In fairness, the anonymous government spokesperson who’s been saying that “hundreds of millions” could be diverted from DFID to MOD is being disingenous too – it’s very, very hard to see how that much could be spent through MOD while keeping within ODA rules.)
So it’s a non-story, basically - and I’m not sure that development advocates are helping their case by being this easy to provoke into fury even when the facts don’t warrant it.February 21, 2013 at 10:00 am | More on Conflict and security, Economics and development |
Breaking news on the post-2015 development agenda just in from Richard in New York, who reports that the UN Secretary-General has set a major new agenda on what should follow the Millennium Development Goals when they expire:
I believe quinoa is truly a food for the MDGs and can make an important contribution to post-2015 development strategies.
And we’ll have more from Ban Ki-moon a bit later in the programme.February 21, 2013 at 9:19 am | More on Economics and development, Off topic |
Now this campaign really annoys me. A gaggle of NGOs have joined forces to launch a declaration demanding that the European Union scrap its emissions trading scheme. The declaration makes some totally valid points about the scheme’s poor track record on driving real emissions reductions, its handouts of what are effectively freebie subsidies to large polluters, its price volatility and recent collapse in carbon prices, and its susceptibility to fraud; all of which is true. And I’d be the first to agree that when you get the design of an emissions trading scheme wrong, it can lead to disastrous consequences – the Clean Development Mechanism being a case in point that I’ve written about here before.
But what’s so infuriating about this campaign is that there is not a single word on how the EU ETS could be fixed. It’s just taken as a given that scrapping it is the only possible way to deal with its flaws. Worse still, the declaration completely fails to say what its signatories would propose to do instead, other than some incredibly vague references to “regulation” (nothing on what sort of regulation, of course); the need for a “zero waste philosophy”; and… well, that’s it.
I really thought the NGO movement had started to grow out of this sort of crap – the bleating from the sidelines, safe in the protest comfort zone, with no serious attempt to engage with real world trade-offs or set out an agenda for action other than whingeing. Even Greenpeace isn’t this bad, and that’s saying something.February 20, 2013 at 11:10 am | More on Climate and resource scarcity, Influence and networks |
There’s a very thoughtful article on where social democracy needs to go next over at Renewal (h/t to Casper for the link), which is thoroughly worth a read. Here’s a quick sample, including some pretty arresting numbers (emphasis added). What a pleasant surprise, incidentally, to see mainstream centre left thinking integrating scarcity and environmental limits into its analysis without fuss, for once – would that this were more the norm…
February 19, 2013 at 8:19 am | More on Economics and development, Global system, Influence and networks |
Social democracy today is bereft of an economic programme. So is the broader left, which has not yet developed an alternative to an unappealing and discredited state socialism. The slow and steady build-up of democratic wealth-holding institutions provides an obvious avenue for the re-animation and re-radicalisation of both, through the generation of a new set of economic institutions and political power bases. But this will require a long-term commitment to evolutionary change and a willingness to step outside of the false choices and immediate constraints of crisis management.
In doing this, the assumptions behind austerity must be called into question. It is a deep irony that the Great Recession is unfolding among some of the richest societies the world has ever known. While the relations of production remain contested, the forces of production have been reaching new heights. In the United States in 2011, the economy produced almost $200,000 (over £125,000) per family of four. In Britain in the same year, the equivalent number was almost $150,000 (almost £95,000). In Germany, it was nearly $160,000 (£100,000). Even in Greece, going through the agony of austerity, production reached over $100,000 (£63,000) per four-person household (OECD, 2012). This is wealth enough – especially given the resource constraints imposed by climate change and emerging energy, mineral, water and other limits to unending growth. The challenge is not technological but organisational and political. It is a matter of systemic design.
This was the development bit in President Obama’s State of the Union address on Tuesday night:
We also know that progress in the most impoverished parts of our world enriches us all. In many places, people live on little more than a dollar a day. So the United States will join with our allies to eradicate such extreme poverty in the next two decades: by connecting more people to the global economy and empowering women; by giving our young and brightest minds new opportunities to serve and helping communities to feed, power, and educate themselves; by saving the world’s children from preventable deaths; and by realizing the promise of an AIDS-free generation
Two things struck me – first, this is a shift from the ‘we can end poverty’ rhetoric that Owen Barder recently pointed out has been around for decades – it’s a ‘we will’ with a time frame, not a ‘we can’ with a vague aspiration. This could – let’s hope – be an important difference from those earlier statements. Secondly, this is of course more or less the time frame that a new post-2015 agreement on development would cover - twenty years from now, or just over fifteen years from 2015. If this is Obama committing to throw the US’s weight behind getting an effective post-2015 agreement, well, that’s very exciting indeed….February 15, 2013 at 1:34 pm | More on Cooperation and coherence, Economics and development, Global system, North America | 1 Comment
Quote of the week: “While I’m not comparing the Rebel Alliance to Al Qaeda or the Galactic Empire to the United States…” Alex Evans
Finding myself watching Empire Strikes Back last night, I found myself reflecting once again on the general crappiness of the rebels’ defenses – for instance, the gun that looks like a radar dish and appears to fail to inflict any damage on anything whatsoever during the battle.
So it’s especially pleasing that Wired’s national security correspondent Spencer Ackerman has decided to employ his knowledge of counter-insurgency doctrine to a setting out a detailed tactical analysis of the Battle of Hoth. Sample:
From a military perspective, Hoth should have been a total debacle for the Rebel Alliance. Overconfident that they can evade Imperial surveillance, they hole up on unforgiving frigid terrain at the far end of the cosmos. Huddled into the lone Echo Base are all their major players: politically crucial Princess Leia; ace pilot Han Solo; and their game-changer, Luke Skywalker, who isn’t even a Jedi yet.
The defenses the Alliance constructed on Hoth could not be more favorable to Vader if the villain constructed them himself. The single Rebel base (!) is defended by a few artillery pieces on its north slope, protecting its main power generator. An ion cannon is its main anti-aircraft/spacecraft defense. Its outermost perimeter defense is an energy shield that can deflect Imperial laser bombardment. But the shield has two huge flaws: It can’t stop an Imperial landing force from entering the atmosphere, and it can only open in a discrete place for a limited time so the Rebels’ Ion Cannon can protect an evacuation. In essence, the Rebels built a shield that can’t keep an invader out and complicates their own escape.
Later comes this gem, which will doubtless have caught a few of his readers by surprise:
Nor does [the Imperial] “blockade” trap Luke, who flies to Dagobah without a single Imperial ship harassing him. That’s the worst possible news for the Empire: Luke is about to rekindle the Jedi order that poses the biggest danger to the preservation of everything Vader and Emperor Palpatine have built. While I’m not comparing the Rebel Alliance to al-Qaida or the Galactic Empire to the United States, in strategic terms, this is like Osama bin Laden’s escape from the December 2001 battle at Tora Bora, Afghanistan — a disaster masquerading as a tactical success.
I did wonder about that reference to “freedom fighters” in the scrolling plot summary at the start of the film…February 14, 2013 at 8:42 am | More on Conflict and security |