Shanghai Forum 

Under the title

Growth and Development – Complement or Contradictions

I looked at some challenges for a global agenda.

This contribution had been part of the  China and Latin America round table, organised by the Centre for BRICS Studies, Fudan Development Institute in the framework of the Shanghai Forum 2016.

The participation was also the public commencement of the cooperation between the Centre for BRICS studies and the BRICS laboratory at EURISPES, Rome.

A background document can be found here, a recording of the presentation can be found here.

From my contribution to the discussion it should be added that the current “shift towards China and the BRICS” should be seen in a world systems perspective, indicating the need of a move away from the mode of production that leaves the old centres EU and USA behind: their ability to offer answers to today’s challenges. The challenge we face together, however, is not about shifting to a new centre but to develop a new overall systemic approach to antroponomic challenges. The Brazilianisation, going hand in hand with the so-called trade agreements (TTIP …) should be dismantled as what they are: protectionist systems that are increasing exclusionary competition- making this point was actually welcomed by many of the participants from Latin America.

Religion

Economics is the religion of equations.

Had been said before, by several others … . A pity that good presentations on the role of monetary expansions are “religionised”, so much deceiving the real issues, even if the directly deal with them.

If you put an ‘almighty god’ into any equation, there is only one solution. If you leave human beings, there needs, the abuse of power ecc. out of economics, there is no solution. As recently said, the devil is not always in the detail; and as also said Brazil is not just a geographical place …

The Devil, the Detail and the Devil’s Home

It is often said that the devil can be found in the detail – and this is not contest here as general rule. However, we should never forget to think about the place where the devil can be found, namely the devil’s home.

The Council of the Economic Advisors is looking in an issue brief from April 2016 at the

While we talk in the meantime extensively about inequality of wealth and the unbelievable affluence of the super-rich, and while we look with disgust at the Panama-papers, there is indeed something in the report that is more appalling  and actually the showing the real issue that is covered by all those scandals, clearly apparent from the report: the real inequality is still the inequality in the control of means of production though, though those means changed over the years they appearance – it may be true that

we are about to make the transition from a society in which energy was the engine of progress, innovation and productivity to one where data and the information technologies that underpin it will be the engine of progress.’

(Degryse, Christophe, 2016: Digitalisation of the Economy and its impact on labour markets; Working Paper 2016.02; Brussels: ETUI: 9 f.; with reference to Babinet, Gilles, 2015: Big Data, penser l’homme et le monde autrement; Paris: Le Passeur)

The inequality not in terms of money but in terms of capital is the decisive factor, so the analysis should really look at The Capital of the 21st Century, and not just at the distribution of money – students are at least sometimes told that there is a difference between money and capital.

This means as well that we have to be careful, resisting the attractive models that are easily offered – resisting in the dialectical way of overcoming the shortcomings while maintaining the potentials. Joe Stiglitz looked recently at the

Monopoly’s New Era

surely raising important issues. However, this makes us easily forget the systematic character, the law if you want, that stands behind the development. It is not the Sshumpetarian entrepreneur who develops with inventiveness and courage the empires, be they empires of steel barons or information gurus. As long as we believe in such magic powers, we easily find ourselves in the trap of distributing income, forgetting to consider the need to question power. Brecht’s words

The womb is fertile still from which that crept

are also valid in this context, not least making us alert of the dangers, posed by capital looking for spheres for investment and war. Indeed, taking it from my forthcoming publication “Security in insecure times” (which is linked to the presentation I made in Gdansk)

… we find as well the mention if the immediate security threat: Paul Krugman, in a conversation with Tony Atkinson on Inequality and Economic Growth at the Graduate Centre of City University of New York speaks of ‘a large public work stimulus programme known as the second world war’ (15/05/16; minute 1:18:13 ff.).[1] And in his opinion page/blog in The New York Times, Krugman contends that ‘World War II is the great natural experiment in the effects of large increases in government spending, and as such has always served as an important positive example for those of us who favor an activist approach to a depressed economy.’

And indeed, we have sufficient evidence of the aggressiveness, be it in international relations, regionally in Latin America or in the name of national democracy.

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[1] Btw, going hand in hand with a rejection of trade unionism.

 

 

 

Democracy

Of course it would be silly to deny the value of democratic rules and mechanisms as free elections, representation and the like. But looking at countries where all these are in place, one may occasionally ask what all this really means.  A report on the situation in France and its labor reform may make us think a bit more. Quoted from the Telsur-aricle:

The plan, opposed by three in four French people, according to pollsters, has provoked weeks of often violent demonstrations and added strains on police who were already stretched by extra security duties in the wake of last November’s deadly Islamist attacks on France.

Brazilianisation

It is always easy – and tempting – to work with slogans and catchwords like Brazilianisation, New Princedoms and the like. One aspect behing putting them forward is the fact that they often focus on one point, by this presenting things neatly. And for this they can and should be always be criticised. But occasionally they also allow us to understand the broader picture that they carry with them. Two recent telesur-reports on the recent developments in Brazil highlight this in an interesting way, highlighting the dangers we are currently facing globally and nationally/regionally.

Dangers we are facing globally means that, of course, what happens there is part of a wider geopolitical strategy:
* Senate-imposed President of Brazil Michel Temer being not much more than a string-puppet to the USNA – yes, the self-elected world gendarme Northern America having again its dirty hands in the game and

Brazil is only the latest Latin American Coup

* the global dimension gets also clear when we understand that the movement is one aiming on getting

Brazil back in the clutches of Washington

Looking at the economic development and the fact that it is to some extent based on throwing off the ropes of the neocolonialist dependencies and obediences, also turning towards BRICS, UNASUR and others are major threats for the overcome system of the global hegemonic structures. – The

Goodbye Washington Consensus

is not really in sight.
Reestablishing inner colonialisation is the second dimension: Brazilianisation is, indeed, about reestablishing the old hegemonies of a white male society, where “austerity” becomes identical with reinstalling a system that ignores human rights, that explicitly opens doors for discrimination and arbitrary rules.

When we then see the term Brazilianistion in its originally intended understanding of the “West” adopting the rules of a then neocolonial country (the origin of the term goes back to the pre-reform Brazil of the late 1990s), the current developments may give us some idea of what we can expect – or it may alert us when it comes to seeing the germs already now:
Nestle Gains Control of Town’s Water for the Next Half Century
It reminds me of an interview I once heard, the Nestle CEO openly stating that he does not care about people dying because of the lack of access to water.

* A colleague from Austria wrote in a recent mail about the way in which his university deals with applications for academic jobs. He claimed that all applications should be assessed by a well defined catalogue of requirement – the same catalogue used for all applicants. The reply he had to face, coming from the chairwoman:

We surely have the right to assess every person indiviually and flexibly.

Right, this happened in Austria and the chairwoman had been a German. Not yet 100 years ago somebody came from Austria to Germany [and of course, he did not stay there].

* And of course we find the inequality exactly HERE. In a policy note of the

Levy Economics Institute of Bard College

we find the data on the 1 % and the 99 %. But not less interesting is a look at the data of the sources of “income”. As true as it is that “honest labour never makes a person rich”, the gap between those who get income from “work” and those how gain from what is called unearned income, defined as

any income that comes from investments and other sources unrelated to employment services

is also increasing.

That the definition of unearned income also includes social transfers/welfare shouldn’t surprise – the clandestine socialisation of private entrepreneurship. If there would be a law making enterprises pay a “decent income”, we would not face the increasing number of the so-called working poor. And the latter live on state welfare but depend increasingly on charities – yes, Brazilianisation and New Princedoms go hand in hand. One of the differences between the old and the new princedoms is, of curse, that the church though still playing an important role, is to me extent replaced by other good-doers: The foundations of the super-rich, defining in their light what social quality should be and profiling themselves as the new messiahs …

Zsuzsa Ferge

I am glad that I could make a small contribution to celebrate this great colleague – it is always a pleasure to meet a person that is ready to stand up, to move things – to sit down – to seriously discuss issues, and to be around – just to have a good time together.  Zsuzsa, thank you!!