Archive for the ‘ Eurozone ’ Category

Made in China–ahem, Italy

The tragic fire at a factory on Sunday, December 1st, 2013, which cost 7 employees their lives, has barely begun to shed light on the industry’s illegal insurgence and Italy’s lack of capacity to do much about it.

Credit: wantchinatimes.com

Pronto moda is a case of what The Economist tags as “reverse globalization.” Cheap materials are shipped from China to Italy–as are the workers, as are the sweatshop concept and conditions. One city, Prato, just northwest of Florence, plays host to over 5,000 factories like the one that burned down on Sunday and some 50,000 Chinese workers buried in 16 hour work-days. Faux-designer products are pumped out at superhuman rates with the facade of labels from designer brands (although the “Made in Italy” label remaining true) and are sold for extremely cheap prices to locals and tourists. Before Italian taxes can even make their claim, more than half of the $2.7 billion profits find their way back to China undeclared.

Chinese utilitarianism and black labor practices are brought to Italy to take advantage of the necessarily perfect combination of an apt market for the pronto moda scheme and weak rule of law in Prato (as what may be an indication of the weaknesses sustained at the national level; consider Rule of Law 1 and Rule of Law 2 to observe Italy’s troubles). Workers, essentially indentured servants, are likely to be left with their promises of a return back to China unfulfilled as they work, bathe, eat, and sleep (in cardboard accommodations as was the case for the victims) within the same few square meters.

The devastating event made headlines in international media; however, the problem for Italian officials isn’t anything new to them. Roberto Cenni, Prato’s mayor, claims that they investigate hundreds of the 3,000+ illegal business every year. The proliferation is too much to handle, he claims, and the operations that Italy is able to shut down only sprout back up the next year. As China merely renders, capitalizes, and improves on what domestic organized crime has done in the country for so long, Italy is forced to drastically improve from the inside-out if it is to have any chance at beginning to address the complicated issues at hand in Prato.

Measuring development and subjective well-being: Human Development Index vs. World Happiness Report

Can measuring “happiness” be a science? Doesn’t the meaning vary too much from person to person and culture to culture? The squishiness of happiness has not prevented researchers from trying to measure it and make it relevant for public policy.

With studies tracing in the paths of what the Human Development Report started over two decades ago, the OECD’s Better Life Index, the OECD’s Guidelines on Measuring Subjective Well-Being, the Happy Planet Index, and the U.S.-focused Gallup-Healthways Well-Being Index (with an international report from 2010) have aimed to perfect the science of quantifying subjective well-being and demonstrate the relatively fresh attention the subject has elicited. Most recently, the United Nations Sustainable Development Solutions Network has released its first World Happiness Report last year.

Subjective Well-Being Indices Rankings-page-001

According to the above table, rankings for well-being become pretty varied. Different indices use and weigh different indicators in different ways. The most exceptional example in this case is the Happy Planet Index which places an immense amount of weight on its indicator, “Ecological footprint” in order to emphasize the importance of environmental sustainability.

But let’s direct our attention to the first two: the United Nations Development Programme’s Human Development Index (HDI) 2013 and the United Nations Sustainable Development Solutions Network’s World Happiness Report (WHR) 2013. The HDI has been a pioneer, and Internationalcomparisons.org has long considered the index to be one of if not the authoritative voice on quality of life, achieving results profoundly more telling than the traditional GDP/capita. The WHR has developed under the influence of the HDI, yet it has come up with different results contrasting most significantly as it relates to Internationalcomparisons.org and the countries studied. Fortunately, the WHR dedicated an entire chapter (Chapter 8) to compare its system to the HDI.

Are more developed countries happier?

Human development, as an approach, is concerned with what I take to be the basic development idea: namely, advancing the richness of human life, rather than the richness of the economy in which human beings live, which is only a part of it.
-Economist Amartya Sen on the capabilities approach and what it means to defining subjective well-being

The objective of Chapter 8 in the WHR is to observe the relationship between human development and life satisfaction, that is to say in certain terms the HDI and the WHR. The chapter discusses at great length the different approaches (human development vs. capabilities) to define and measure development, satisfaction, happiness, and subjective well-being. Chapter 8 asks how positive is the relation between the HDI and life evaluation of well-being? For the intents and purposes of the HDI and WHR reports in the scope of the 150+ countries surveyed, very positive. Chapter 8 dissects individual indicators of the HDI like life expectancy, years of expected education, actual years of schooling, and GNI/capita with positive life satisfaction and concludes with correlative coefficients of 0.70, 0.69, 0.63, 0.73, and 0.78. Finally, HDI (overall score) shares a correlative coefficient of 0.77 with life satisfaction.

While this is good news in determining that the gap between measurements of human development and subjective well-being is closing thanks to an increased focus and research on the subject, our more narrow scope concerning the gap among the 12 countries studied at Internationalcomparisons.org disappointingly still lacks explanation.There are 33 places between the systems’ rank for Japan, 20 places for Germany and Italy, and 14 places for the U.S. and Denmark (which the WHR has at 1st). The correlative coefficient is either not strong enough at 0.77 or not relevant enough with the 12 countries on which we focus.

Examining the German and Californian shifts on immigration

International Organization for Migration sign promotes the benefits that immigrants bring.

International Organization for Migration sign promotes the benefits that immigrants bring in front of the UN building in New York. Credit: internationalcomparisons.org

“Kinder statt Inder” or “Children before Indians” was reverberated throughout Germany pervasively in both policy and public attitude only a decade ago. Since then, Germany’s success at withstanding the financial crisis has brought about a good problem, albeit one that requires a shift in such policy and attitude. Germany’s joblessness and decline in overall population has required it to look elsewhere than domestic means in order to fill gaps in its labor force.

In a relatively abrupt 180 degree turn, Germany has welcomed over 33% more immigrants in 2011 than 2010, attempted to ease the adaption process socially by providing language lessons, and have reduced the required financial requirements like minimum salary.

Germany is hardly experiencing a change of heart. The shift comes from certain political motives and not necessarily humanitarian benevolence.  Meanwhile in California, although the impact is yet to prove as profound (especially from the national front), considerable victories have been accomplished just this past week.

While Washington waffles on immigration, California’s forging ahead. I’m not waiting.

California Governor Jerry Brown sweepingly signed immigration bills one after the other last week in an effort to demonstrate to Washington that, outside of President Obama’s Deferred Action for Childhood Arrivals (DACA) from summer of 2012, it will neither lean nor wait on Washington to make demonstrative moves toward immigration reform. DACA has provided some foundation by applying prosecutorial discretion to all cases concerning the children of parents who have immigrated illegally. This has opened the door for states to grant certain liberties to immigrants, and Governor Brown is taking full advantage.

In his first move he granted immigrants the ability to obtain driver’s licenses. Since DACA, the number of states that have allowed driver’s licenses to immigrants has jumped from three to eleven.

He also signed a refined version of the TRUST Act after it easily passed through the state Assembly and Senate. The TRUST Act limits detentions to only those who have committed felonies, not misdemeanors. The TRUST Act is a direct response to the Secure Communities program which was originally intended to remove the most dangerous immigrants with a criminal history. The program, however, has been criticized for removing immigrants with petty misdemeanor charges as well.

Also signed were bills to limit an employer’s ability to threaten to report their immigration status to authorities. This gives the concerned employee more ability to handle wage issues, abuses in the workplace, and to work in an overall better environment according to an LA Times article.

Still another bill has been passed to disallow ones immigration status as a hindrance to becoming an attorney in the state of California.

With his hands more or less tied in Washington, President Obama has no other choice after seeing his Dream Act fail miserably but to resort to relatively quiet measures like DACA and depend on states to take charge from there. California has done just that. Unlike Germany where the motive has been ulterior politically and economically, California truly stands out as it achieves these steps toward immigration reform for the sake of the immigrant, himself.

The Crisis of the Anthropocene: Part 2

Continued from The Crisis of the Anthropocene: Part 1.

by Dr. Sherman Lewis, Professor Emeritus Political Science, California State University East Bay

Cheap fossils

Peak oil refers to the gradual increase in the cost of extracting fossil fuels causing higher prices, decreasing demand, and declining production. As peak oil is reached, the volume of extraction declines. Peak oil was reached years ago in the US. In 2010 the International Energy Association announced that peak oil may have occurred internationally in 2006. The price of gasoline has been erratically ratcheting up. Conventional petroleum is probably less available at the same time that rapidly growing economies demand more oil. Most Americans are likely to continue to buy gas as if there were no tomorrow and blame politics, oil companies, and speculators for a problem inherent in the earth’s crust. The timing of the ratchet is unpredictable. Crudeoilpeak.info/global-peak has excellent data on the past, but less certain projections for the future.

Credit: theresilientearth.com

Unfortunately, the benefit peak oil might provide to reduce global warming is being more than offset by other fossils, which seem well short of any peak. Higher oil prices so far only serve to stimulate more extraction of oil from risky deep ocean platforms, coal, dirty oil from shale and sand, and natural gas from fracking, which pollutes huge volumes of clean water. Fossil fuels are still in under-priced over-abundance and consumption is even increasing. The earth’s crust appears sufficiently generous in fossils to assure the demise of the climate that supported human development. However great for the money economy, it is not sustainable in the whole economy.

Under-pricing reduces the viability of non-fossil alternatives—solar wind, photovoltaic and thermal energy, energy efficiency, conservation, non-auto modes, and efficient land use.

Water

Humans appropriate more than half the world’s fresh water. Ancient aquifers in the world’s bread baskets, including the Ogallala in the Great Plains, are being drained. California has diverted so much water from the Bay Delta system that its historic ecology has collapsed. The salmon, steelhead, and striped bass are mostly gone, leaving the tiny Delta Smelt as the remaining indicator species. Water shortages are increasing. A federal court recently ordered water released into the Klamath River to prevent fish kills, at the expense of farmers who wanted the water. The San Joaquin Valley has sunk many feet in some places due to over-pumping of ground water.

In December 2012, the Interior Department said by mid-century the Colorado River will not support demand from the seven states it supplies, including California. The main reason is expected population growth in the region from 40 million to as many as 76 million people. “Phoenix continues to grow at one of the highest rates in the country,” said Jerry Karnas, population and sustainability director of the Center for Biological Diversity. “There is no discussion about what the future Phoenix is going to do when the Colorado River is done.”

As rains diminish and the climate dries in some areas, increased pumping from falling aquifers becomes more expensive due to the cost of electricity, itself dependent on water supplies and fossils. As diets improve, demand for food higher up the food chain requires more water. Only 2 percent of major U.S. rivers run unimpeded to the sea. California’s Sacramento-San Joaquin River Delta has been entirely re-engineered. The last time the Colorado River reached the Sea of Cortez was in 1998. The Nile, Indus and Ganges rivers have been reduced to a trickle. (See chellaney.net for information on the most pertinent international water issue.)

Credit: thelivingocean.net

 

Pollution

Pollution of water, air, and land comes from burning fossils, hazardous chemicals, excess nutrients, and solid waste. Small amounts of a chemical can devastate amphibians and bees. Residues from 100 million tons of synthetic chemical compounds produced each year commonly appear in polar bear tissues, whale blubber, and human breast milk and umbilical cords. Nitrogen can be a fertilizer; the excess is a problem. Human activity surpasses nature as a source of nitrogen emissions, altering the planet’s nitrogen cycle.

Radioactivity has been an evolutionary background reality and a minor pollutant since the Strontium 90 scares of the 1950s, but is now looming much larger as radioactivity from the Japanese Fukushima Daiichi Reactor melt-down drifts across the Pacific Ocean to the West Coast of North America. Radioactivity has proven deadly from the earliest research to the bombing of two Japanese cities. In theory and most practice radioactivity is one of the most strictly regulated pollutants, but the difficulty of failsafe nuclear energy and the possibility of nuclear war and nuclear terrorism are still there.

Bioengineering is not usually thought of as a pollutant, but at the micro-scale of DNA it could be considered to be one, much like an invasive species in a habitat. So far, research and industry safeguards have prevented acute problems, but secrecy about Genetically Modified Organisms, lack of consumer choice, and industry assurances motivated in part by profit-seeking do not inspire confidence. Wind-blown GMO seeds have already contaminated some organic crops. We are still learning the most basic things about DNA, let alone how it can safely be manipulated.

California has eight of the 10 most air-polluted cities in the country and 725 metric tons of solid waste are washing up on our coast each year.

Higher, higher still Credit: InternationalComparisons.org

Credit: InternationalComparisons.org

Land

Humans have converted more than 40 percent of the earth’s land, usually the most biologically productive land, to cities and farms. Urbanization often destroys prime farmland. Roads and structures fragment the habitat of much of the rest. The increasing need for food and decreasing yields due to climate change, salinization, soil erosion, soil depletion, and conversion to other uses have led to converting more marginal, unfarmed land to crops. Farms and logging are big sources of deforestation and also causes greenhouse gases and loss of sequestration of atmospheric carbon.

Oceans

A third of world fisheries are exhausted or degraded. Forty percent of coral reefs and a third of mangroves have been destroyed or degraded. Most species of the great predator fish are in decline. Ocean acidification, a product of fossil fuel burning, is dissolving calcifying plankton at the base of the food chain. Coral reefs are disappearing as warming, over-fishing, and pollutants cause massive bleaching, i.e., the ejection by the coral of the algae it needs to grow. Less life in the oceans reduces sequestration of carbon. A garbage gyre at least twice the size of Texas swirls in the Pacific Ocean. “We can’t just continue dumping nitrogen into the ocean at the same rate and expect everything to be fine,” Santa Clara University’s Marvier said.

Auto-dependency

The world is rapidly increasing the number and use of cars, while other, healthier, modes of transportation, especially walking, are shrinking in proportion. Underpricing of fossil fuel drives land use dispersion, resulting in a suburban system which makes other modes uneconomic and unavailable. Californians own 32 million registered vehicles for 29 million people aged 16 and older.

Misconceptions

The problem is not consumption as understood by economists, but rather the over-consumption of some things due to their under-pricing which fails to consider full economic cost and allows externalization of costs, degrading the whole economy: “problem consumption.” The whole economy includes values of obvious economic worth that are not reflected in prices. We cannot conceive a sustainable economy because it is too complex, but we can have policies which push us towards one, with sustainable consumption replacing the unsustainable over time, and an improving status of women reducing population growth.

There is no “birth dearth,” at least, not yet. World fertility rates have fallen from 4.9 births per woman in the 1960s to the current 2.6, still too high. The rate in about half the world—Japan, Western Europe, China, Vietnam, Brazil, Iran, Thailand, and other emerging economies—is below the 2.1 births per woman needed for zero growth. The United States, the world’s third-largest country behind China and India, and the only rich country still growing, nevertheless recently saw its birth rate fall to 1.9.

The improvement in the status of women has driven birth rates down through education, economic opportunity, legal protections, family planning, and, to a small extent, therapeutic abortion. Across cultures, women choose to provide a better life for fewer children.

The revolution, however, is incomplete because high economic costs are still imposed on most women who choose to have children. Historically, the duties of child-rearing have been assumed by women, but, with improved status and given a choice, women reduce the burden. Once a developed country chooses to tax itself to ease the cost, women, if need be, are ready, willing, and able to have more children, because few things in life are more fulfilling.

While the population gets older, the ratio of dependent seniors on younger workers does not tell us what we need to know. The ratio is less relevant, possibly irrelevant, because health is increasing faster than age, and many older people want to work at work they choose. Also, if there are tax penalties, like loss of retirement income if one works, people will work less for money and more at other things. I retired to avoid tax penalties and to work voluntarily on sustainability analysis and advocacy. My wife retired and is almost fulltime at granddaughter care so that our kids can work for money. Rebalancing incentives for having children and for older working can solve problems, if they occur.

Major source: Carolyn Lochhead, San Francisco Chronicle Washington correspondent, SF Chronicle, Sept. 3, 2013.

Syria vs Obama: duplicity’s consequences

Simultaneously venerable yet duplicitous. If the US is to use force to respond to the Syrian conflict, the discouragement of chemical weapons is a worthy ends, yet the means are hardly beyond reproach. It is a bit ironic, indeed, that the US is playing the role of the UN (with Russia, of course as Syria’s ally, debilitating any serious action with its veto power in the Security Council) and enforcing the agreements from the Chemical Weapons Convention (CWC), one of the few major international agreements ratified by the US. For every supposedly venerable reason to make war, there’s two or three more international treaties the US has not ratified or has ratified yet violates.

Still, President Obama’s decision was a cunning one from a domestic policy and an international relations (IR) perspective.

I will seek authorization for the use of force from the American people’s representatives in Congress.

Domestically, his decision to welcome the debate and leave it to Congress to have the final say when it’s his authority ultimately as Commander in Chief is a wise one. Not only does this allow Obama to share responsibility should things go awry, he also creates a difference between himself and his predecessor’s assumption of power. Of course it is also placative for the US war-tired public that he has promised the omission of ground troops. Let’s hope this isn’t him leaving the door open for a drone showcase–yet another controversy (note the date of linked article).

Concerning an IR perspective, Obama walks a tight rope of (supposedly) humanitarian interventionism between warmongering and pure-hearted assistance. Again, Obama is clear in claiming that he desires to have no political impact with the strike than to discourage the CWC breach. According to these statements, Obama has no intention in affecting the outcome of the war, lingering in Syria, imposing the Washington Consensus, or meddling in Syria’s politics to influence their resources.

(It should still be said that the US’ decision to dish out the punishment for international treaty violations is controversially overstepping to put it mildly, let alone absolutely hypocritical as far as international agreements are concerned. The US is trying to exemplify Syria, but does this set the precedent for the US’ responsibility to enforce the CWC?)

Even after Saturday, we have no idea what cards Obama is keeping close to his chest or to what extent the content he has revealed is intended as a cover for undisclosed incentives. But if Obama doesn’t follow through with what he assured on Saturday, that the “… action will be limited in time and scope,” he will be held responsible by not only the international community, but his own Congress and people. And if Obama means what he says, he’s got a hell of a road ahead of him and obstacles to overcome before he’ll be able to follow through.

The two-edged sword of universal health care

As Dr. Philip Caper has revealed, there’s more at stake concerning health care than whether the U.S. should have free health care for all.

He evaluates the costs offered for medicare services in the U.S. compared to the prices for the same procedures (be it a hip replacement, pregnancycolonoscopy, angiogram, or an M.R.I.) in other advanced democracies. When a surgery would cost someone $100,000 in the States in comparison to $13,660 to have it done in Belgium (airfare included), flaws in the more expensive system become glaring.

Furthermore, concerns are drawn in the United States health care system given the discrepancy among prices for the same medicare procedures when compared within the U.S. For example, procedures to treat heart failure and shock in Modesto, CA average a bill of over $92,000. The exact same category averages $3,334 in Danville, Arkansas. Geographical differences only explain so much. Systemic flaws must be at the root of the 2,700% difference.

Credit: Huck/Konopacki Cartoons

The issue in the U.S. is two-fold; therefore, universal healthcare as a solution is also double-edged. Universal health care would make health care an affordable reality for all. One study reveals that 1 out of every 4 elderly people goes bankrupt as a result of health care expenses. The United States has a broken system in which its government spends more per capita (except for Norway) and more as a percent of GDP than any other advanced democracy studied at internationalcomparisons.org.

A U.S. universal health care system would also eliminate pricing discrepancies, as reviewed above, not only in international comparisons, but interstate as well. No longer would people need to shop international hospitals for a colonoscopy or worry why Medicare has no reasonable explanation for price differences in Danville, Arkansas.

It’s a shame and a quandary: not only the systemic debacles, but also the lack of public outcry.

Health Regulation page goes live!

The Health Regulation page is relevant to internationalcomparisons.org for several reasons. Let’s highlight a couple of the most critical:

This is pretty straight forward. A great example is the link between child advertising and child obesity. U.S. advertisers spend $15-17 billion annually on advertisements targeting children. As a direct result, 35% of U.S. children are obese. Only Italy and the UK have rates over 25% in the EU which restricts advertisement to children by the EU Audiovisual Media Services Directive which mandates that child advertisement:

a. shall not directly exhort minors to buy a product or a service by exploiting their inexperience or credulity;
b. shall not directly encourage minors to persuade their parents or others to purchase the goods or services being advertised;
c. shall not exploit the special trust minors place in parents, teachers or other persons;
d. shall not unreasonably show minors in dangerous situations;
e. Children’s programs may only be interrupted if the scheduled duration is longer than 30 minutes;
f. Product placement is not allowed in children’s programs;
g. The Member States and the Commission should encourage audiovisual media service providers to develop codes of conduct regarding the advertising of certain foods in children’s programs.

  • The U.S. is the most reluctant advanced democracy to apply the precautionary principle.

In spite of pumping out nearly 20 new chemicals per day (according to Craig Collins’ Toxic Loopholes), the U.S. somehow still doesn’t find it necessary to have tighter policy to regulate the safety of those chemicals. The precautionary principle can be described as a method of policy making by which all chemicals are considered dangerous until proven harmless. Instead, U.S. chemical policy treats the unpredictable agents as innocent until proven guilty. Even once harm is associated with the chemical, certain systemic pitfalls have made it almost impossible to get such chemicals banned. The EU has banned over 1,000 chemicals; the U.S., in spite of the prolific rates at which new chemicals are produced, has banned a laughable total of nine chemicals. Wider application of the precautionary principle could have saved us the multifaceted and widespread hazards from PCBs. Without such tests required, who knows what we’re risking with GMOs and U.S. backed Monsanto initiatives.