Monthly Archives: February 2017

Trump is right to criticize NAFTA—but he’s totally wrong about why it’s bad for America

BOOK REVIEW

The Mexican Shock, Author: Jorge Castañeda.

By Jeff Faux – Will he deliver on this pledge? No.

But the reason is not, as the conventional economic wisdom has it, because outsourcing work to low-wage countries is the inevitable result of immutable global forces that no president can reverse.

The problem for American workers is not international trade, per se. America has been a trading nation since its beginning. The problem is, rather, the radical new rules for trade imposed by NAFTA—and copied in the myriad trade deals signed by the US ever since—that shifted the benefits of expanding trade to investors and the costs to workers.

Trump is right that the 1994 agreement with Mexico and Canada displaced US jobs—some 850,000, most of which were in manufacturing. But he is wrong in his claim that American workers lost out to Mexican workers because US negotiators were outsmarted. The interests of workers were never a priority for either American or Mexican negotiators.

NAFTA was the first important trade agreement that reflected the dramatic realignment of economic class interests across national borders. The globalization of corporate finance, production, and marketing has disconnected the interests of investors and workers throughout the world. more> https://goo.gl/anxVjL

Why Facts Don’t Change Our Minds

BOOK REVIEW

The Enigma of Reason, Authors: Hugo Mercier and Dan Sperber.
The Knowledge Illusion: Why We Never Think Alone, Authors: Steven Sloman and Philip Fernbach.
Denying to the Grave: Why We Ignore the Facts That Will Save Us, Authors: Jack Gorman and Sara Gorman.
The Sixth Extinction: An Unnatural History, Author: Elizabeth Kolbert.

By Elizabeth Kolbert – Stripped of a lot of what might be called cognitive-science-ese, Mercier and Sperber’s argument runs, more or less, as follows: Humans’ biggest advantage over other species is our ability to coöperate. Coöperation is difficult to establish and almost as difficult to sustain.

For any individual, freeloading is always the best course of action. Reason developed not to enable us to solve abstract, logical problems or even to help us draw conclusions from unfamiliar data; rather, it developed to resolve the problems posed by living in collaborative groups.

“Reason is an adaptation to the hypersocial niche humans have evolved for themselves,” Mercier and Sperber write. Habits of mind that seem weird or goofy or just plain dumb from an “intellectualist” point of view prove shrewd when seen from a social “interactionist” perspective.

Consider what’s become known as “confirmation bias,” the tendency people have to embrace information that supports their beliefs and reject information that contradicts them.

If reason is designed to generate sound judgments, then it’s hard to conceive of a more serious design flaw than confirmation bias.

Imagine, Mercier and Sperber suggest, a mouse that thinks the way we do. Such a mouse, “bent on confirming its belief that there are no cats around,” would soon be dinner. more> https://goo.gl/hUYB9s

Will Democracy Survive Big Data and Artificial Intelligence?

By Dirk Helbing, Bruno S. Frey, Gerd Gigerenzer, Ernst Hafen, Michael Hagner, Yvonne Hofstetter, Jeroen van den Hoven, Roberto V. Zicari, Andrej Zwitter – The digital revolution is in full swing. How will it change our world? The amount of data we produce doubles every year. In other words: in 2016 we produced as much data as in the entire history of humankind through 2015.

Every minute we produce hundreds of thousands of Google searches and Facebook posts. These contain information that reveals how we think and feel. Soon, the things around us, possibly even our clothing, also will be connected with the Internet. It is estimated that in 10 years’ time there will be 150 billion networked measuring sensors, 20 times more than people on Earth. Then, the amount of data will double every 12 hours.

Many companies are already trying to turn this Big Data into Big Money.

It can be expected that supercomputers will soon surpass human capabilities in almost all areas—somewhere between 2020 and 2060. Experts are starting to ring alarm bells.

One thing is clear: the way in which we organize the economy and society will change fundamentally. We are experiencing the largest transformation since the end of the Second World War; after the automation of production and the creation of self-driving cars the automation of society is next. With this, society is at a crossroads, which promises great opportunities, but also considerable risks. If we take the wrong decisions it could threaten our greatest historical achievements.

.. our freedom is disappearing slowly, but surely—in fact, slowly enough that there has been little resistance from the population, so far. more> https://goo.gl/x7HsRQ

Centrism is Dead. Time to Rebuild the Left.

By Teryn Norris – Today, centrism lies in shambles, crushed under years of escalating asymmetric polarization culminating in the election of a deranged, authoritarian president backed by Republican leadership. The failure of national centrism is complete: as a political strategy, as a theory of social change, and as a way of understanding political reality.

What is required now is broad recognition that centrists cannot resolve our deepening crisis. Structurally, they are too dependent on the Washington party system and its false equivalency. Intellectually, they suffer from a poverty of imagination. Philosophically, they have few core commitments. And temperamentally, they are too milquetoast, lacking one of the most essential traits for such a moment: political courage.

The centrist has a keen interest in maintaining their privileged position in the political community. He or she gets to remain above the fray; to moralize about the need for compromise without defining clear positions; to serve as a convener and power broker; to critique both sides and play them off each another; to act like the only sober adult in the room. Such a position often confers unique advantage inside the beltway, affording access to powerful officials, to reporters seeking the “balanced” view, and to lucrative support from interested parties.

“We are living through the most dangerous challenge to the free government of the United States that anyone alive has encountered,” warns David Frum. more> https://goo.gl/NELrEU

The Only Thing, Historically, That’s Curbed Inequality: Catastrophe

By Walter Scheidel – The pressures of total war became a uniquely powerful catalyst of equalizing reform, spurring unionization, extensions of voting rights, and the creation of the welfare state. During and after wartime, aggressive government intervention in the private sector and disruptions to capital holdings wiped out upper-class wealth and funneled resources to workers; even in countries that escaped physical devastation and crippling inflation, marginal tax rates surged upward.

Concentrated for the most part between 1914 and 1945, this “Great Compression” (as economists call it) of inequality took several more decades to fully run its course across the developed world until the 1970s and 1980s, when it stalled and began to go into reverse.

This equalizing was a rare outcome in modern times but by no means unique over the long run of history. Inequality has been written into the DNA of civilization ever since humans first settled down to farm the land.

Throughout history, only massive, violent shocks that upended the established order proved powerful enough to flatten disparities in income and wealth. They appeared in four different guises:

  1. mass-mobilization warfare,
  2. violent and transformative revolutions,
  3. state collapse, and
  4. catastrophic epidemics.

Hundreds of millions perished in their wake, and by the time these crises had passed, the gap between rich and poor had shrunk. more> https://goo.gl/b2D6Dj

Economists Get Too Much Credit — and Blame

By Victoria Bateman – Now, with the threat of deglobalization hanging over us, economists stand on the sidelines, feeling ignored.

This recent turn of events might leave us wondering: Do economists have the power and influence required to affect political and policy outcomes, or is it politics that determines which strains of economics are cherry-picked and ultimately championed?

Were John Maynard Keynes alive today, he would no doubt argue that the global financial crisis, Brexit and the election of Donald Trump are all a result of a failed free-market economic agenda, resulting in rising inequality and a slowdown in economic growth, leaving the general public reeling. Economists would be squarely in the dock.

As far as that great rival to Keynesian thinking, Milton Friedman, was concerned, it is the public’s experiences and not the writings of economists that drive economic and policy revolutions. more> https://goo.gl/4J5c2x

Updates from Adobe

Flower Power: Photographer Bettina Güber
By Jordan Kushins – Photographer Bettina Güber has made a habit of paying close attention to the kinds of things that others might pass by, and preserving their subtle beauty with her trusty Nikon.

Güber, who lives in Krefeld, Germany, has built up a robust Behance portfolio of evocative images of the natural world (some of which she also offers on Adobe Stock), but she didn’t always think of herself as a creative person.

She credits the confines of a desk job with giving her a nudge to develop her artistic talents. “I was an office clerk back in the 1990s, and my boss decided that we should make our own flyers and brochures. So I started learning the graphics software—but without any artistic approach,” she says. (These days, she makes a living primarily as a media designer, crafting advertisements and collateral for a company that sells automotive spare parts.) more> https://goo.gl/fHc21T

Related>

Americans aren’t as attached to democracy as you might think

By Austin Sarat – While we have been focused on partisan divides over government policy and personnel, an almost invisible erosion of the foundations of our political system has been taking place. Public support for the rule of law and democracy can no longer be taken for granted.

While President Trump’s behavior has riveted the media and the public, our eyes should not only be focused on him but on this larger – and troubling – trend.

If the rule of law and democracy are to survive in America we will need to address the decline in the public’s understanding of, and support for both. While we celebrate the Ninth Circuit’s decision on Trump’s ban, we also must initiate a national conversation about democracy and the rule of law. Civics education, long derided, needs to be revived.

Schools, civic groups, and the media must to go back to fundamentals and explain what basic American political values entail and why they are desirable. Defenders of democracy and the rule of law must take their case to the American people and remind them of the Founders’ admonition that:

If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary. In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself.

more> https://goo.gl/q5VdsE

End of a golden age

BOOK REVIEW

An Extraordinary Time: The End of the Postwar Boom and the Rise of the Ordinary Economy, Author: Marc Levinson.

By Marc Levinson – Between 1948 and 1973, Australia, Japan, Sweden and Italy had not a single year of recession. West Germany and Canada did almost as well. The good times rolled on so long that people took them for granted.

Governments and the economists who advised them happily claimed the credit. Careful economic management, they said, had put an end to cyclical ups and downs. Governments possessed more information about citizens and business than ever before, and computers could crunch the data to help policymakers determine the best course of action. In a lecture at Harvard University in 1966, Walter Heller, formerly chief economic adviser to presidents John F Kennedy and Lyndon B Johnson, trumpeted the success of what he called the ‘new economics’. ‘Conceptual advances and quantitative research in economics,’ he declared, ‘are replacing emotion with reason.’

The Golden Age was wonderful while it lasted, but it cannot be repeated. If there were a surefire method for coaxing extraordinary performance from mature economies, it likely would have been discovered a long time ago. more> https://goo.gl/oQN8FL

The European Unraveling?

By Ana Palacio – The problem for the EU is no longer the indifference that marked the worst elements of President Barack Obama‘s approach to Europe. It is outright US hostility. Trump’s praise of Brexit, which emphasized the British people’s “right to self-determination,” and his belittling reference to the EU as “the Consortium” in his appearance with British Prime Minister Theresa May, underscores his hostility.

Europe is now stuck between a US and a Russia that are determined to divide it. What are we Europeans to do?

One option is to pander to Trump. That is the approach May took on her visit to Washington, DC, when she stood by silently as Trump openly declared his support for the use of torture at their joint press conference.

But, for the EU, such appeasement would be counter-productive. It is our values, not our borders, that define us. It makes little sense to abandon them, especially to ingratiate ourselves with a leader who has shown himself to be capricious and utterly untrustworthy.

The third option – and the only viable one for the EU – is self-reliance and self-determination. Only by strengthening its own international positions – increasing its leverage, in today’s jargon – can the EU cope effectively with America’s wavering fidelity to its allies and the values they share. more> https://goo.gl/FRuIrO