The Emerging International Regime Prabhat Patnaik

Third world economies are now facing a reduced export demand for their goods and services for two distinct reasons. One is the world capitalist crisis which entails a reduced aggregate demand in the world economy and hence reduced aggregate exports for all countries taken together; the other is the protectionism of the U.S., which, by garnering for that country a larger share than it would have otherwise had of this reduced world market, leaves correspondingly less for others. Since the imports of several of these third world countries are more sluggish to change, these countries face an enlarged trade deficit,…

The Indiscreet Aggression of the Bourgeoisie C. P. Chandrasekhar

Neoliberal economic policy—the framework of measures that preaches market fundamentalism but uses the state to engineer a redistribution of income and assets in favour of finance capital and big business—has lost its legitimacy. A huge financial crisis and a decade of recession or low growth, that have hurt most sections except the elite 1 per cent, have convinced the majority in many countries that neoliberalism is no alternative. That change in mood was revealed by the Brexit vote and the Trump victory among other developments. However, this has not setback but unleashed a new aggression on the part of the…

Trump Versus the Rest Prabhat Patnaik

Donald Trump’s leaving the G-7 summit without budging an iota on protectionism is indicative of the disunity among the leading capitalist countries on the strategy to overcome the capitalist crisis. Trump has decided that the U.S. would go its own way, by enlarging the fiscal deficit, not just for giving tax concessions to the corporates, which would have little demand-stimulating effect anyway, but also for increasing government expenditure which would have this effect, and at the same time by protecting the domestic market. These two strands of Trump’s strategy have to go together. In fact in the absence of protectionism,…

Trump’s Trade War C. P. Chandrasekhar

After a year of huffing and puffing, President Donald Trump has launched, since January this year, what some are terming a trade war—fought in scattered industrial and selected locations. It started with quotas and tariffs on solar panel and washing machine imports, but then moved menacingly to steel and aluminium. Tariffs on these two products have been imposed under a WTO clause relating to imports that threaten national security, even while Trump’s rhetoric refers to competition from "cheap metal that is subsidized by foreign countries", which amounts to a completely different ‘dumping’ charge. With the tariff hike on steel at…

The Aging of a Growth Engine C.P. Chandrasekhar and Jayati Ghosh

With the dollar value of exports declining, India’s software sector faces a historical crisis which may worsen, given the protectionist trends in the US and other uncertainties. Aging_Growth_Engine  (Download the full text in PDF format) (This article was originally published in the Business Line on February 13, 2018)

A Latin American Perspective on Trade Policies Marta Bekerman and Santiago Rodríguez

This paper analyses - in the light of the various contributions offered by the theoretical literature and by international experience- the role of trade policy in all those areas where State intervention can help to improve Latin America’s international economic linkages. It is posited that in the countries of the region, trade policy can be an instrument for macroeconomic management, fiscal management and, at the microeconomic level, resource allocation. trade_policies (Download the full text in PDF format)

Redollarization to Worsen the Argentine Crisis Sabyasachi Mitra

Passing judgment in a landmark case the Supreme Court of Argentina recently declared that the deposit of US $247 million that the province of San Luis has with the state-owned Banco de la NaciAon has to be returned to the province in dollars. This has led to the fear that the Court has in effect declared as unconstitutional a one-year-old decree issued by the Argentine President that led to the conversion of billions of dollar-denominated bank deposits into pesos. The Court ruled 5–3 in favour of redollarization. The ruling however has run into controversy with accusations of biasedness against two…

Confronting the IMF – Argentina’s Road to Recovery Tom Gill

"For many years in Argentina," declared Eduardo Duhalde as he assumed the presidency on January 1, "they have made us believe that amid this new world order, there is only one possible economic model. This is a complete falsehood." Argentinians, who once lived in a country as rich as France, will be hoping he is right. These days, after two-and-half-decades of IMF-backed free-market reforms, more than 40% of the 38m population live below the poverty line and 100 children die daily from hunger and disease. As a leading member of the Peronist party, which under Carlos Menem brought Argentina to…