The good news is that the gap between the emerging and advanced countries has narrowed greatly in the last three decades. Nonetheless, hundreds of millions of people remain in poverty, and there has been only a little progress in reducing the gap between the least developed countries and the rest.

Here, unfair trade agreements – including the persistence of unjustifiable agricultural subsidies, which depress the prices upon which the income of many of the poorest depend – have played a role. The developed countries have not lived up to their promise in Doha in November 2001 to create a pro-development trade regime, or to their pledge at the G8 summit in Gleneagles in 2005 to provide significantly more assistance to the poorest countries.

The market will not, on its own, solve any of these problems. Global warming is a quintessential “public goods” problem. To make the structural transitions that the world needs we need governments to take a more active role – at a time when demands for cutbacks are increasing in Europe and the US.

As we struggle with today’s crises, we should be asking whether we are responding in ways that exacerbate our long-term problems. The path marked out by the deficit hawks and austerity advocates both weakens the economy today and undermines future prospects. The irony is that, with insufficient aggregate demand the major source of global weakness today, there is an alternative: invest in our future, in ways that help us to address simultaneously the problems of global warming, global inequality and poverty, and the necessity of structural change.

Read the complete article at The Guardian.

This is really unfortunate, because the economy can definitely use some help. Rather than offering help, the real question with the budget standoff is how much further we will impair economic growth with further cuts to the deficit. Rather than posing a problem, the deficit is a crucial support to the economy at present and it is likely to remain a crucial support for the foreseeable future.

The simple story of this downturn, and indeed for much of the last two decades, has been one of inadequate demand. In the decades immediately following World War II, productivity growth quickly translated into wage growth, ensuring that demand kept pace with productive capacity. The relationship between productivity growth and wages broke down in the 80s as a result of several policy changes, most importantly rules weakening unions, opening sectors of the economy to trade, and the deregulation of transportation, communication and other key sectors.

Consumption boom

With more income going to profits, there was a risk that demand would lag productivity, since a smaller share of profits will be spent than wage income. In the 1990s, the gap between productivity and wages was filled by the stock bubble. When the ratio of stock prices to profits rose to more than twice their trend level, it sparked a surge in investment, and more importantly a consumption boom. Over the course of the 90s, the saving rate fell from close to 8 per cent at the start of the decade (its long-term average) to just 2 per cent at the peak of the bubble in 2000.

Read more at Al Jazeera.

The economic interests of capitalists (defined as those who earn most of their income from capital) are beginning to diverge significantly from the interests of social conservatives (defined as those who prefer traditional gender relations and oppose government efforts to promote racial and ethnic equality).

In other words, the symbolic marriage of capitalism and conservatism is showing signs of strain.

It was never an idyllic relationship. The early growth of capitalism weakened the pre-existing patriarchal feudal system. In the late 18th century, Edmund Burke, the Irish writer and member of Parliament considered one of the founders of modern conservatism, famously warned that the single-minded pursuit of economic self-interest would undermine hallowed traditions.

Read more at the New York Times.

Boushey received her Ph.D. in economics from the New School for Social Research and her B.A. from Hampshire College. She has held an economist position with the Joint Economic Committee of the U.S. Congress, the Center for Economic and Policy Research, and the Economic Policy Institute, where she was a co-author of their flagship publication, The State of Working America 2002/3. She grew up in a union family in Mukilteo, Washington, and now lives with her husband, Todd Tucker, in Washington, D.C.

Black developed the concept of “control fraud” – frauds in which the leader uses the entity as a “weapon.” Control frauds cause greater financial losses than all other forms of property crime combined and kill and maim thousands. He helped the World Bank develop anti-corruption initiatives, served as an expert for OFHEO in its enforcement action against Fannie Mae’s CEO, and assisted Icelandic and French leaders responding to their financial crises. Black has testified to Congress four times about the financial crisis – financial derivatives, executive and professional compensation, Lehman’s failure and related regulatory failures, and the role of control fraud in the bubble and crisis. He is a regulatory columnist for Benzinga

Mr. Chanos is Chairman of the Coalition of Private Investment Companies, whose members are diverse in their size and investment strategies. The members’ clients include pension funds, asset managers, foundations, other institutional investors, and qualified wealthy individuals. In that role, Mr. Chanos has testified before Congress and provided comments to regulations proposed by the U.S. Securities and Exchange Commission and the Financial Services Authority in theUnited Kingdom.

At the Yale University School of Management, Mr. Chanos is a Visiting Lecturer in Finance, teaching a class on the history of financial fraud.

An expert on the politics of U.S. health and social policy, he is the author of Winner-Take-All Politics: How Washington Made the Rich Richer and Turned Its Back on the Middle Class, written with Paul Pierson (2010, paperback 2011), The Great Risk Shift: The New Economic Insecurity and the Decline of the American Dream (2006, paperback 2008), The Divided Welfare State: The Battle over Public and Private Social Benefits in the United States (2002), and The Road to Nowhere: The Genesis of President Clinton’s Plan for Health Security (1997), co-winner of the Brownlow Book Award of the National Academy of Public Administration. He is co-author, with Paul Pierson, of Off Center: The Republican Revolution and the Erosion of American Democracy (2005) and has edited two volumes—most recently, Health At Risk: America’s Ailing Health System and How to Heal It (2008).

A frequent media commentator, Hacker has testified before Congress, advised leading politicians, and written popular pieces for the American Prospect, New Republic, Nation, New York Times, New York Times Magazine, Los Angeles Times, Washington Post, Boston Globe, Boston Review, and other publications. He is the author of a 2007 proposal for universal health care, “Health Care forAmerica,” that became a template for several presidential aspirants’ plans.

Most recently with support from the Rockefeller Foundation, he and a group of multi-disciplinary researchers including Greg Huber and Mark Schlesinger of ISPS developed the Economic Security Index (ESI), which measures the share of Americans who experience at least a 25 percent decline in their income from one year to the next. In addition, he oversees a Social Science Research Council project on the “privatization of risk.”

Draut’s research has been covered by dozens of newspapers and magazines including The New York Times, Washington Post, Newsweek, BusinessWeek, Chicago Tribune, Wall Street Journal and USA Today. Her writing has appeared in The San Francisco Chronicle, The American Prospect, TheBostonGlobe and TheBostonReview. She is a frequent television commentator and has appeared on the Colbert Report, Today Show, ABC World News Tonight, CNN’s Lou Dobbs Tonight and Fox News.

Naomi Klein’s first book No Logo: Taking Aim at the Brand Bullies released in 2000 was an international bestseller translated into over 25 languages with more than a million copies in print. The New York Times called it “a movement bible.” In 2011, Time Magazine named it as one of the Top 100 non-fiction books published since 1923. A tenth anniversary edition of No Logo was published worldwide in 2010. The Literary Review of Canada has named it one of the hundred most important Canadian books ever published. A collection of her writing, Fences and Windows: Dispatches from the Front Lines of the Globalization Debate was published in 2002. Naomi Klein is a contributing editor for Harper’s and reporter for Rolling Stone, and writes a regular column for The Nation and The Guardian that is syndicated internationally by The New York Times Syndicate. In 2004, her reporting from Iraq for Harper’s won the James Aronson Award for Social Justice Journalism. Additionally, her writing has appeared in The New York Times, The Washington Post, Newsweek, The Los Angeles Times, The Globe and Mail, El Pais, L’Espresso and The New Statesman, among many other publications.

Today’s column is just chock full of these false assertions. Early on Friedman tells us:

“many Americans understand something is very wrong, that we could go the way of Greece or Japan if we don’t shape up, and that they will embrace a candidate who trusts them with the truth, that is, an honest diagnosis of where we are and how we get out of this mess.”

That was really neat, go the way of Greece or Japan? That’s kind of like going the way of Bernie Madoff or Warren Buffet. Greece’s economy is being systematically destroyed by the conditions imposed by the European Central Bank and the I.M.F. It’s unemployment rate  is near 25 percent and virtually certain to go higher as virtually everyone projects at least another year of economic contraction. By contrast, the unemployment rate in Japan is just over 4.0 percent. While Greece is clearly a disaster, Japan’s economy has done better in many respects than the U.S. economy over the last two decades.

His next big whopper comes one paragraph down when Friedman tells readers:

“This merger [of globalization and technology] makes old jobs obsolete faster and spins off new jobs faster, but all the good new jobs require higher skills.”

This is the structural unemployment story. This one can be easily disproved because none of the facts fit. There are no major sectors of the economy with rapidly rising wages, with longer workweeks and with large numbers of job openings relative to the number of unemployed. These are all characteristics of markets with labor shortages — the jobs requiring higher skills story that Friedman is telling. It’s a cute story, there’s just  no evidence for it .

Read more at Alternet.

For example, if the minimum wage had kept up with inflationsince 1968, its historical high point, it would now be over $10.50 per hour. And this is despite the fact that today’s low-wage workers are older and better educated than in the past. Had the minimum wage also risen in step with low-wage workers’ age and educational attainment since 1968, it would even higher in 2012, approaching $11 per hour.

The current minimum wage looks even worse when compared with two major family expenses. To pay tuition at a public four-year college, a minimum-wage worker had to work 254 hours in a year in 1979, while in 2010 it took 923 hours, or almost six months of full-time work. Similarly, in 1979, a minimum-wage worker had to work 329 hours to pay for a family health insurance policy, but 2,079 hours in 2011, or basically a year of full-time work.

Read more from U.S. News & World Report

For starters, China’s impressive growth performance over the last three decades has given the world an economically successful example of what many call “state capitalism.” Brazil’s development policies have also accorded a strong role to the state.

Questions concerning the state’s size and the sustainable role of government are central to the debate over the eurozone’s fate as well. Many critics of Europe, particularly in the US, link the euro crisis to the outsize role of government there, though the Scandinavian countries are doing well, despite high public spending. In France, the new center-left government faces the challenge of delivering on its promise of strengthening social solidarity while substantially reducing the budget deficit.

Alongside the mostly economic arguments about the role of government, many countries are experiencing widespread disillusionment with politics and a growing distance between citizens and government (particularly national government). In many countries, participation rates in national elections are falling, and new parties and movements, such as the Pirate Party in Germany and the Five Star Movement in Italy, reflect strong discontent with existing governance.

Read more at Caijing.

“Romney is going to have to define a vision of modern capitalism. …. Let’s face it, he’s not a heroic entrepreneur. He’s an efficiency expert.”

Brooks is certainly right that Romney is not a heroic entrepreneur, but it doesn’t follow that he is necessarily an efficiency expert either. The private equity folks like to tell stories of how they find poorly managed companies, clean them up, and then sell them for a big profit.

The living wills were prepared in compliance with the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act and are a major step forward in terms of revealing how global megabanks are structured. Yet they are shockingly incomplete and flawed in one crucial aspect: They neglect to explain how cross- border assets and liabilities would be handled in different legal jurisdictions.

The plans should be rejected by officials and sent back to the banks to be revised. As these proposals now stand, they are a blueprint for further financial disaster, and additional taxpayer-backed bailouts. (Note: the published parts of these wills haven’t been edited or reviewed by the FDIC or the Fed.)

To the more cynically minded, ignoring cross-border issues is akin to planting a poison pill in the heart of these living wills. When the time comes to wind down a failing megabank, the complexities and potentially dangerous domino effects surrounding the failure of a cross-border institution are likely to increase pressure for a bailout that will protect creditors, and perhaps shareholders and executives, too.

Read more at The Huffington Post.

Not only did the private sector fail to create enough jobs. With the crisis in state and local budgets and the absence of federal aid, the loss of public sector jobs continued. Ordinarily in a slump, public employment takes up some of the slack. In this recession, government has shed 627,000 jobs.

Here’s the deeper worry. Not only could a weakening economy cost Barack Obama the election — this slump could literally go on indefinitely.

In the aftermath of a financial collapse, the economy gets stuck in a downward spiral. Banks are too traumatized to lend, businesses see too few customers to invest, and there is too little purchasing power among consumers who are either out of work or who haven’t seen a raise in a decade. The housing bust only adds to the downward drag.

Exports have been a bright spot, but as Europe succumbs to a similar vortex of recession compounded by austerity, Europe’s even worse economic woes are likely add to America’s.

Something similar happened in the late 1930s. Though economic growth returned, it wasn’t strong enough to repair the damage of the Great Depression or create enough jobs. Despite the New Deal, unemployment remained stuck at around 12 percent.

Read more at The Huffington Post.