Look, I appreciate the partial attack on TPP, especially its
codification of corporate power, but surely you'd agree the limits of
Stiglitz are on stark display here, Bob.
1) In July when he was at the Bellagio estate, he called the forthcoming
*Paris climate deal a "charade"*... but now he revises with a partial
endorsement: "the world is moving, inexorably, toward a green economy."
That's simply not true, the Paris Conference of Polluters is still a
charade, even more so given how much global legitimation was passed
along to those negotiators. Here are seven reasons why, by Oscar Reyes:
http://fpif.org/seven-wrinkles-paris-climate-deal/ ... and my take:
https://zcomm.org/znetarticle/paris-climate-terror-could-endure-for-generations/
2) On the *BRICS New Development Bank*, first, it will amplify all the
worst tendencies of Bretton Woods banking (
http://www.counterpunch.org/2015/07/10/brics-bankers-confirm-they-will-undergird-not-undermine-western-financial-decadence/
and my slides are here,
http://www.open.ac.uk/ikd/podcasts/brics-banking-and-debate-over-sub-imperialism
) and second, it's no secret anymore - because his colleague Nick Stern
let the cat out of the bag in a talk he didn't know was taped - that in
proposing the NDB take the form it has, Stiglitz, Stern and the late
Ethiopian tyrant Meles Zenawi were really aiming to facilitate
multinational corporate exploitation of poor countries. To do so, they
needed to "reduce the potential for government-induced policy risk",
e.g. the kind of "unreliable" Bolivarian attack on MNCs that motivated
the NDB instead of BRICS support for Chavez's Bank of the South. Don't
take it from me, here's Stern:
If you have a development bank that is part of a [major business] deal
then it makes it more difficult for governments to be unreliable... What
you had was the presence of the European Bank for Reconstruction and
Development (EBRD) reducing the potential for government-induced policy
risk, and the presence of the EBRD in the deal making the government of
the host country more confident about accepting that investment. /And
that is why Meles Zenawi, Joe Stiglitz and myself, nearly three years
ago now, started the idea – and are there any press here, by the way?
OK, so this bit’s off the record. We started to move the idea of a
BRICS-led development bank/ for those two reasons. Coupled with the idea
that the rich countries would not let the balance sheets of the World
Bank and some of the regional development banks expand very much, and
they would not allow their share in those banks to be diluted. So
essentially by refusing to come up with more money and by refusing to
let other people come up with more money by not allowing those shares to
be diluted, you’re essentially limiting what the existing World Bank and
existing regional development banks can do. (emphasis added)
https://www.youtube.com/watch?v=4ZKQ6wQ-29w
3) On his belief that "The US did act with greater wisdom
where//*China’s currency was concerned**,*" sure, no one wants
Washington to retain its undemocratic power over any organ of globo gov,
especially the IMF. But really, is it useful to have the yuan playing a
legitimating role in the most maniacal processes within world finance? I
argue no, here:
http://www.telesurtv.net/english/opinion/China-Sucked-Deeper-into-World-Financial-Vortex-as-BRICS-Sink--20151125-0024.html
4) On his TPP sensibility, "*The problem is not so much with the
agreement’s trade provisions*." Yes it is: all these trade
liberalisations have had disastrous consequences. But ultimately
Stiglitz the economist most values "basic principles of efficiency and
the free flow of goods."
5) Again on TPP, "Even the way Obama argued for the new trade agreement
showed how out of touch with the emerging global economy his
administration is. He repeatedly said that the TPP would determine who –
America or China – would write the twenty-first century’s trade rules.
*The **/correct /**approach is to arrive at such rules */*collectively,*
/ with all voices heard, and in a /transparent/ way." The problem here
is the danger that again, in terms of legitimation, Stiglitz runs the
risk of ceding this "collective" power to /both /the 1%ers of the US and
China. (If not, he should say so explicitly.) The neoliberal faction of
the Chinese Communist Party - the guys that promote greater trade and
investment, especially that they face such a severe internal
overaccumulation crisis - cannot be trusted to represent the genuine
interests of 1.4 billion people, just as Obama's lads cannot be trusted,
as we saw last month in Nairobi at the WTO summit.
As you and your mates are close to Stiglitz, I would expect you to fight
me on these points. Fine. But if you agree with some, is there any
chance he would move left, as he did so admirably for a few months in
1998-99 (when I first met him by accident on an airplane, as he railed
so forcefully against the Clinton Treasury and Fed)?
It would be fantastic to see more Keynesians take the excellent
opportunity, /this week,/ of new financial melting to explore the
terrain on the left. It's a shame Stiglitz had so little new to say in
his last column about China, and that in the /NYT/ Krugman is stumbling
so much on the question of Chinese contagion. I always thought Stiglitz,
at least, had much more potential to look at matters with his political
economic wisdom and refrain from propping up the "basic principles" of
neoliberalism.
But correct me if I'm too ultra on this, as ever...
Cheers,
Patrick
On 2016/01/11 01:32 AM, Robert Naiman wrote:
*In 2016, let's hope for better trade agreements - and the death of TPP*
Joseph Stiglitz <http://www.theguardian.com/profile/josephstiglitz>**
http://www.theguardian.com/business/2016/jan/10/in-2016-better-trade-agreements-trans-pacific-partnership
Last year was a memorable one for the global economy. Not only was
overall performance disappointing, but profound changes – both for
better and for worse – occurred in the global economic /system/.
Most notable was the Paris climate agreement reached last month
<http://www.theguardian.com/global-development/2015/dec/15/climate-change-deal-five-reasons-glad-five-reasons-gloomy>.
By itself, the agreement is far from enough to limit the increase in
global warming to the target of 2ºC above the pre-industrial level.
But it did put everyone on notice: the world is moving, inexorably,
toward a green economy. One day not too far off, fossil fuels will be
largely a thing of the past. So anyone who invests in coal now does so
at his or her peril. With more green investments coming to the fore,
those financing them will, we should hope, counterbalance powerful
lobbying by the coal industry, which is willing to put the world at
risk to advance its shortsighted interests.
Indeed, the move away from a high-carbon economy, where coal, gas, and
oil interests often dominate, is just one of several major changes in
the global geo-economic order. Many others are inevitable, given
China’s soaring share of global output and demand. The New Development
Bank, established by the Brics (Brazil, Russia, India, China
<http://www.theguardian.com/world/china>, and South Africa), was
launched during the year, becoming the first major international
financial institution led by emerging countries. And, despite Barack
Obama’s resistance, the China-led Asian Infrastructure Investment Bank
was established as well, and is to start operation this month.
The US did act with greater wisdom where China’s currency was
concerned. It did not obstruct the renminbi’s admission to the basket
of currencies that constitute the International Monetary Fund’s
reserve asset, Special Drawing Rights (SDRs). In addition, a
half-decade after the Obama administration agreed to modest changes in
the voting rights of China and other emerging markets at the IMF – a
small nod to the new economic realities – the US Congress finally
approved the reforms
<http://www.bloomberg.com/news/articles/2015-12-18/congress-approves-imf-changes-giving-emerging-markets-more-sway>.
The most controversial geo-economic decisions last year concerned
trade. Almost unnoticed after years of desultory talks, the World
Trade Organization’s Doha Development Round – initiated to redress
imbalances in previous trade agreements that favored developed
countries – was given a quiet burial. America’s hypocrisy – advocating
free trade but refusing to abandon subsidies on cotton and other
agricultural commodities – had posed an insurmountable obstacle to the
Doha negotiations. In place of global trade talks, the US and Europe
have mounted a divide-and-conquer strategy, based on overlapping trade
blocs and agreements.
As a result, what was intended to be a global free trade regime has
given way to a discordant managed trade regime. Trade for much of the
Pacific and Atlantic regions will be governed by agreements, thousands
of pages in length and replete with complex rules of origin that
contradict basic principles of efficiency and the free flow of goods.
The US concluded secret negotiations on what may turn out to be the
worst trade agreement in decades, the so-called Trans-Pacific
Partnership (TPP)
<http://www.theguardian.com/business/2015/oct/05/tpp-or-not-tpp-whats-the-trans-pacific-partnership-and-should-we-support-it>,
and now faces an uphill battle for ratification, as all the leading
Democratic presidential candidates and many of the Republicans have
weighed in against it. The problem is not so much with the agreement’s
trade provisions, but with the “investment” chapter
<https://www.project-syndicate.org/commentary/trans-pacific-partnership-charade-by-joseph-e--stiglitz-and-adam-s--hersh-2015-10>,
which severely constrains environmental, health, and safety
regulation, and even financial regulations with significant
macroeconomic impacts.
In particular, the chapter gives foreign investors the right to sue
governments in private international tribunals when they believe
government regulations contravene the TPP’s terms (inscribed on more
than 6,000 pages). In the past, such tribunals have interpreted the
requirement that foreign investors receive “fair and equitable
treatment” as grounds for striking down new government regulations –
even if they are non-discriminatory and are adopted simply to protect
citizens from newly discovered egregious harms.
While the language is complex – inviting costly lawsuits pitting
powerful corporations against poorly financed governments – even
regulations protecting the planet from greenhouse gas emissions are
vulnerable. The only regulations that appear safe are those involving
cigarettes (lawsuits filed against Uruguay and Australia for requiring
modest labeling about health hazards had drawn too much negative
attention). But there remain a host of questions about the possibility
of lawsuits in myriad other areas.
Furthermore, a “most favoured nation” provision ensures that
corporations can claim the best treatment offered in any of a host
country’s treaties. That sets up a race to the bottom – exactly the
opposite of what US President Barack Obama promised.
Even the way Obama argued for the new trade agreement showed how out
of touch with the emerging global economy his administration is. He
repeatedly said that the TPP would determine who – America or China –
would write the twenty-first century’s trade rules. The /correct
/approach is to arrive at such rules /collectively, / with all voices
heard, and in a /transparent/ way. Obama has sought to perpetuate
business as usual, whereby the rules governing global trade and
investment are written by US corporations for US corporations. This
should be unacceptable to anyone committed to democratic principles.
Those seeking closer economic integration have a special
responsibility to be strong advocates of global governance reforms: if
authority over domestic policies is ceded to supranational bodies,
then the drafting, implementation, and enforcement of the rules and
regulations has to be particularly sensitive to democratic concerns.
Unfortunately, that was not always the case in 2015.
In 2016, we should hope for the TPP’s defeat and the beginning of a
new era of trade agreements that don’t reward the powerful and punish
the weak. The Paris climate agreement may be a harbinger of the spirit
and mindset needed to sustain genuine global cooperation.
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