TRIPS waiver, & how the East vs. the West dealt with COVID-19 Jomo Kwame Sundaram
Multilateralism which broke down post-Cold war has remained so during this pandemic as well. Countries dealt with the pandemic differently. South Africa & India spoke up for a WTO TRIPS waiver on testing equipment and vaccines and was opposed mainly by the EU. There has been enormous resistance to compulsory licensing as well, contributing to worsening health indicators. Full video available at: https://www.youtube.com/watch?v=rI9Wt0WWP94
War or Peace, Barbarism or Hope Anis Chowdhury and Jomo Kwame Sundaram
The spectre of ‘stagflation’ threatens the world once again. This time, the risk is the direct consequence of political provocations and war, and not simply due to inexorable economic forces. Stagflation? Stagflation is a composite word implying inflation with stagnation. Stagnation refers to weak, ‘near zero’ growth, inevitably worsening unemployment. Inflation refers to price increases – not high prices, as often implied. The term ‘stagflation’ was supposedly first used in 1965 by Iain Macleod, then UK Conservative Party economic spokesperson. He later became Chancellor of the Exchequer, or finance minister, in 1970 for little over a month, the shortest tenure in…
Ante la Amenaza de la Estanflación ser Pragmático, no Dogmático Anis Chowdhury and Jomo Kwame Sundaram
“Si tu única herramienta es un martillo, cualquier problema parece un clavo”. Todavía perseguidos por la predica del fantasma del gurú monetarista Milton Friedman, demasiadas autoridades monetarias abordan subiendo las tasas de interés cada amenaza o señal inflacionaria que ven. El dictamen del estadounidense Friedman, uno de los fundadores de la neoliberal Escuela de Chicago, de que «la inflación es siempre y en todas partes un fenómeno monetario» aún sigue definiendo la ortodoxia. A pesar del cambio de circunstancias en el mundo actual, para los “friedmanistas”, la inflación debe ser frenada mediante un endurecimiento monetario, especialmente con subidas de los…
Stagflation Threat: Be pragmatic, not dogmatic Anis Chowdhury and Jomo Kwame Sundaram
“If your only tool is a hammer, every problem looks like a nail”. Still haunted by the clever preaching of monetarist guru Milton Friedman’s ghost, all too many monetary authorities address every inflationary threat or sign they see by raising interest rates. Friedman’s dictum that “inflation is always and everywhere a monetary phenomenon” still defines the orthodoxy. Despite changed circumstances in the world today, for Friedmanites, inflation must be curbed by monetary tightening, especially interest rate hikes. No central banker consensus The threat of higher inflation has risen with Russia’s Ukraine incursion and the punitive Western ‘sanctions from hell’ in…
Ukraine Incursion, World Stagflation Anis Chowdhury and Jomo Kwame Sundaram
Finger pointing in the blame game over Russia’s Ukraine incursion obscures the damage it is doing on many fronts. Meanwhile, billions struggle to cope with worsening living standards, exacerbated by the pandemic and more. Losing sight in the fog of war ]US Secretary of State Anthony Blinken insists, “the Russian people will suffer the consequences of their leaders’ choices”. Western leaders and media seem to believe their unprecedented “crushing sanctions” will have a “chilling effect” on Russia. With sanctions intended to strangle Russia’s economy, the US and its allies somehow hope to increase domestic pressure on Russian President Vladimir Putin to retreat from Ukraine. The…
Inflation Targeting Voodoo Anis Chowdhury and Jomo Kwame Sundaram
All over the world, people expect policies by central bankers trained in economics to have a sound scientific base. But in fact, inflation targeting is an article of faith with neither theoretical nor empirical basis. Policy inspiration The two per cent (2%) inflation target is now virtually an “economic religion”. US Federal Reserve chairman Jerome Powell noted it had become a “global norm”. In 1989, New Zealand became the first country to adopt a 2% inflation target. “The figure was plucked out of the air”, acknowledged Don Brash, then Governor of the Reserve Bank of New Zealand (RBNZ), its central bank.…
The Climate Finance Conundrum Anis Chowdhury and Jomo Kwame Sundaram
According to the UN Framework Convention on Climate Change, climate finance refers to local, national, or transnational financing that supports mitigation and adaptation efforts to address climate change (UNFCCC). It might come from governmental, private, or nontraditional funding sources. While climate financing is essential for mitigation, adaptation, 'losses and damages' (L&D), and overall risk management, many poor nations' climate plans and activities are conditional on receiving the necessary financial support. Unsurprisingly, one of the most divisive issues in climate politics is assisting poorer nations in addressing climate change. Download full article (This article was originally published in SpringerLink on February…
Resist Inflation Phobia Coup Anis Chowdhury and Jomo Kwame Sundaram
No inflation consensus International Monetary Fund (IMF) Managing Director Kristalina Georgieva doubts the world faces a runaway inflation threat. She urges policymakers to carefully calibrate fiscal and monetary policies, with more “specificity”, as not ‘one size fits all’. Widespread reversal of COVID-19 spending and low interest rates threaten recovery. Similarly, Bank of England chief economist Huw Pill stressed the central bank was not going all out to tighten monetary policy. Instead, like Georgieva, he advocates a more nuanced approach, reasoning, “As the pandemic recedes and the level and composition of global demand and supply normalise, these inflationary pressures should subside”. US inflation phobia…
Climate Inaction, Injustice Worsened by Finance Fiasco Jomo Kwame Sundaram
Many factors frustrate the international cooperation needed to address the looming global warming catastrophe. As most rich nations have largely abdicated responsibility, developing countries need to think and act innovatively and cooperatively to better advance the South. Climate action The world is woefully offtrack to achieving the current international consensus that it is necessary to keep the global temperature rise by the end of the 21st century to no more than 1.5°C (degrees Celsius) above pre-industrial levels two centuries ago. The last Intergovernmental Panel on Climate Change (IPCC) report warns that temperatures are then likely to exceed 2.2°C. Many climate…
More Progressive Taxation Needed for Social Progress Jomo Kwame Sundaram
Governments must innovatively develop progressive means to finance the large-scale social spending needed to improve lives and livelihoods, especially following the COVID-19 pandemic. More egalitarian tax reforms should enable governments to equitably mobilize desperately needed revenue to advance sustainable development for all. Fiscal policy challenges To respond to the pandemic and its economic fallout, massive resource mobilization has been necessary to protect people’s health and livelihoods, stem economic decline and stagnation, and ensure sustainable progress. Fiscal policy involves governments harnessing and deploying resources. But modes of state financing and spending impact economic inequalities. Monetary policy measures can be supportive, but they cannot…