The Neoliberal Counter-revolution in Retreat? Jomo Kwame Sundaram

The US Wall Street crash of 1929 was followed by the Great Depression, which in turn engendered two important policy responses in 1933 with lasting consequences for generations to come: President Franklin Roosevelt's New Deal and the Glass-Steagall Act. While massive spending following American entry into the Second World War was clearly decisive in ending the Depression and for the wartime boom, the New Deal clearly showed the way forward and would have succeeded if more public money had been deployed consistently to revive economic growth. Although Michal Kalecki and others had anticipated some of his work, it took a…

Expansionary fiscal consolidation myth Jomo Kwame Sundaram, Anis Chowdhury

KUALA LUMPUR, Malaysia, Aug 11  - The debt crisis in Europe continues to drag on. Drastic measures to cut government debts and deficits, including by replacing democratically elected governments with ‘technocrats', have only made things worse. The more recent drastic expenditure cuts in Europe to quickly reduce public finance deficits have not only adversely impacted the lives of millions as unemployment soared. The actions also seem to have killed the goose that lay the golden egg of economic growth, resulting in a ‘low growth' debt trap. Government debt in the Euro zone reached nearly 92 per cent of GDP at…

Free Trade’s Diminishing Returns Jomo Kwame Sundaram and Vladimir Popov

KUALA LUMPUR/MOSCOW – In its May 2010 “Global Survey,” McKinsey & Company reported that, “the core drivers of globalization are alive and well.” In an April 2014 report, the firm went further, declaring that, “to be unconnected is to fall behind.” But now McKinsey seems to have changed its tune. In a new report, “Poorer Than Their Parents? Flat or Falling Incomes in Advanced Economies,” the McKinsey Global Institute asserts that developed countries should not expect further gains from the process of globalization. Income growth has stalled since the 2008 financial crisis and “even a return to strong GDP growth…

Poverty, Vulnerability and Social Protection Jomo Kwame Sundaram

According to the World Bank, the MDG target of halving the share of the poor was achieved by 2008, well in advance of 2015, the target year. However, increased unemployment and lower incomes in recent times remind us that poverty is not an unchanging attribute of a shrinking group, but rather, a condition that billions of vulnerable persons risk experiencing. Despite the various shortcomings of money measures of poverty, they nevertheless reflect the extent of vulnerability. For example, the estimated number of poor globally in 2012 more than doubles from 902 million to 2.1 billion when one raises the poverty…

US Government Report Exposes Exaggerated TPPA Growth Claims Jomo Kwame Sundaram

A US government agency acknowledges that the Trans-Pacific Partnership (TPP) will not deliver many economic benefits promised by its cheerleaders. The 2016 report by the United States International Trade Commission (ITC) acknowledges that the TPP will not deliver many gains claimed by the US Trade Representative (USTR) and the Peterson Institute of International Economics (PIIE) although it uses similar methodology and assumes that the TPP will not change the US trade deficit as a share of GDP. The ITC’s credibility has declined over the years as it earned a reputation for cheer-leading FTAs. It had grossly underestimated US trade deficit…

Economic Recovery Needed To Enhance Food Security Jomo Kwame Sundaram

After a half century of decline, agricultural commodity prices rose with oil prices in the 1970s, and again for a decade until 2014. Food prices rose sharply from the middle of the last decade, but have been declining since 2012, and especially since last year, triggering concerns of declining investments by farmers. Earlier predictions of permanently high food prices have thus become less credible. Higher prices were said to reflect slowing supply growth as demand continues to grow with rising food needs for humans and livestock, and bio-fuel mandates introduced a decade ago on both sides of the North Atlantic.…

Is Sustainable Development Hindering Economic Recovery? Jomo Kwame Sundaram

The global economic and employment situation is alarmingly protracted, with recovery not expected any time soon. In October 2012, then IMF chief economist Olivier Blanchard indicated he did not see a global economic recovery before 2016. Now, in mid-2016, it is clear that the global crisis has dragged on for several reasons; many governments, especially in advanced economies, still prioritize fiscal austerity and tough labour market reforms, even though such measures undermine livelihoods, incomes, the social fabric and economic recovery prospects. Meanwhile, despite ‘quantitative easing', investments remain depressed, blocking employment creation. Easy credit before the crisis led to over-investment in…

How to End Hunger Hilal Elver and Jomo Kwame Sundaram

Last September, world leaders made a commitment to end hunger by 2030, as part of the United Nations Sustainable Development Goals (SDGs). It sounds like a massive undertaking. In fact, the world already produces enough food to feed everyone. So why does the problem persist? Poverty and hunger are intimately connected, which is why the SDGs target elimination of both. For someone living at the World Bank’s poverty line of $1.90 per day, food would account for some 50-70% of income. The Bank estimates that almost four-fifths of the world’s poor live in rural areas, though those areas account for…

The UN and Global Economic Stagnation Jomo Kwame Sundaram

When the financial crisis preceding the Great Recession broke out in late 2008, attention to the previously ignored UN Secretariat’s analytical work was greatly enhanced. This happened as the UN and the Bank of International Settlements (BIS) had been almost alone in warning, for some years, of the macroeconomic dangers posed by poorly regulated financial sector developments. In contrast, most other international organizations – the IMF, World Bank and OECD – which monitor developments in the world economy have failed to see the crisis coming. Until the third quarter of 2008, they were still predicting continued robust growth of the…