Why Witchcraft Works

lakevUkerewe, the island in the Tanzanian half of Lake Victoria where I am currently spending a few months, is famous for witchcraft. Witches are found in every village, in every street. They earn a living by selling curses. If you want to punish a friend or destroy an enemy, you pay a witch to smite him with some misfortune – illness, injury, impoverishment, death. Because these things are so common anyway, it is easy for witches to claim that it was the curse that did the damage, and easy therefore for them to stay in business. And there begins the vicious circle – bad things sustain belief in witchcraft, belief in witchcraft absolves you (or your government) of any responsibility for your lot, so more bad things happen, and the witches grow ever more powerful.

US sets out big statement of global climate policy. Don’t hold your breath

US Special Envoy for Climate Change Todd Stern’s speech at Chatham House a couple of days ago is worth a look if you follow climate change. But don’t expect it to cheer you up.

It’s a thoughtful piece that clearly sets out where the US is coming from with regard to a new international agreement. But here’s the key part – which comes right after he acknowledges developing countries’ concerns about retaining space to develop as “entirely legitimate”:

The nationally determined structure of commitments we have already discussed should satisfy this pragmatic purpose, since countries would make their own decisions about what kind of mitigation commitments were appropriate given their own circumstances and capabilities.

Sigh – here we are once again with the same old pledge-and-review crap of countries doing whatever they figure they can manage, and then hoping it will somehow magically add up to the right global outcome. As though the atmosphere will award ‘marks for effort’.

And if you’re wondering where this kind of approach leads us, well, this year’s IEA World Energy Outlook  – published next month but extract available here – estimates that the net effect of commitments under the Copenhagen Accord will be 3.6-5.3 degrees Celsius of long term warming, most of it before the end of this century.

Oh, and despite the comprehensive nature of Stern’s speech, there’s one thing he conspicuously didn’t mention – the global target of limiting warming to 2 degrees Celsius. Go figure.

Someone explain to me again how the Obama Administration’s global climate policy is different from that of the Bush Administration?

What’s happening to global incomes

Now here’s an interesting graph, courtesy of the World Bank’s resident inequality guru, Branko Milanovic. It shows change in real incomes over the period of 1988 to 2008 at different percentiles of global income distribution (in 2005 dollars, adjusted for PPP).

Global inequality

Over at the right hand side, what you see is the mega-rich doing very well indeed: the real incomes of the top 1% went up by 60% over this period. (That’s about 60 million people, by the way – including the richest 12% of Americans, the richest 3% of Brits, Japanese, Germans, and French, and the richest 1% of Brazilians, Russians, and South Africans.)

But they’re not the biggest winners, as it turns out. To find them, look at that massive peak in the centre of the x axis, between the 50th and 60th percentile of global income. There you’ll find 200 million Chinese, 90 million Indians, and 30 million each from Indonesia, Brazil and Egypt. These are the people who’ve seen the fastest rise in incomes: an 80% real terms increase over 20 years at the median.

Over at the left hand side, you find the world’s poor. They’ve also done pretty well, for the most part, with real incomes rising between 40% and 70%. This is ground zero for the decline in the number of people living in extreme poverty in recent times (from 44% to 23% of the world’s population over these two decades). There’s an exception, though: the really poor people who are on the far left hand side, whose real incomes have remained stagnant. Want to ‘get to zero’ on poverty as part of the post-2015 agenda? These are the people you’re focusing on.

And that huge dip between the 75th and 85th percentiles? Why, that’s the squeezed middle in developed countries, plus a lot more people in Latin America and former Communist countries – watching their incomes stagnate while those just to the right of them hoover up globalisation’s winnings.

Overall, Milanovic calls this set of changes “probably the profoundest global reshuffle of people’s economic positions since the Industrial Revolution”. Read the whole paper (pdf, 27 pages) – it’s terrific.

Justine Greening’s interesting new core messages

Justine Greening has done a big interview with the Daily Mail, which concludes as follows:

Greening, to her credit, does not seek to back away from what she believes in. That includes making the best of the Tory commitment to keep Britain in the forefront of foreign assistance. 

The big difference is that she believes that the aid budget is not just about alleviating poverty, however, important that may [sic]. It is also about easing the passage for great British commercial firms in emerging markets and ensuring the resources are more carefully marshalled.

So that’s interesting.

Ten billion dollars for global public goods? Where do we sign?

“Innovative financing” is one of those phrases you’re always hearing in development, but that never quite seem to live up to the hype. It refers, in case you’re not familiar with it, to the idea of raising international public finance not from traditional sources like aid, but from zappy new sources like the Robin Hood Tax, or flogging off IMF gold, or capitalising Special Drawing Rights, or introducing new global taxes on things like marine bunker fuels.

In particular, you often hear the idea mooted as a way of financing global public goods (GPGs) – stuff like agricultural research and development, vaccine production and distribution, technology cooperation, UN peacekeeping, biodiversity and rainforest preservation, and so on – as for instance in this excellent CGD paper by Nancy Birdsall and Benjamin Leo.

Which would be a Good Thing, because GPGs are woefully underfunded. In their paper, Birdsall and Leo totted up the total amount spent on them in 2011 and it came to about 12 billion dollars – about a tenth of global ODA spending, in other words. And three quarters of that goes to pay for the UN peacekeeping budget, leaving not a whole lot for everything else.

And yet… for all the talk, not much ever really seems to happen. True, the EU has agreed a financial transactions tax that will apparently generate €57 billion, but that’s more likely to fund European farmers than global public goods. And while France did persuade a handful of countries to sign up to an airline ticket levy, that’s raised less than a billion dollars since it launched.

But wait! At the Assembly of the International Civil Aviation Organisation earlier this month, member states agreed to go ahead with developing a ‘market based mechanism’ to reduce greenhouse gas emissions from the aviation sector by 2016.

While most of the media coverage was about what this would mean for aviation emissions (and for the EU Emissions Trading Scheme, which controversially covers them), there’s also another question: how much money might such a mechanism raise, and where would it go?

Obviously, it’s impossible to answer that without knowing the details of the new scheme – which will depend on negotiations over the next three years. But the IMF has previously estimated that an aviation fuel excise tax of $0.20 per gallon could yield up to $9.5 billion per year if implemented globally, while a separate analysis undertaken by the 2010 UN High-level Advisory Group on Climate Change Financing estimated that an aviation fuel emissions tax could generate $2 billion a year by 2020 – so we could potentially be talking about doubling the amount of GPG financing, if that’s where the money goes.

Here’s hoping that campaigning groups are getting saddled up for some serious lobbying to make sure that the money’s used to maximum effect. Just think how many acres of rainforest conservation that could finance, or new vaccines it could develop, or sustainable agriculture techniques it could develop, or…

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