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Tag Archives: Economic fundamentals

China: The Covert Credit Superpower

An new working paper by Sebastian Horn, Carmen Reinhart and Christoph Trebesch on China’s foreign lending has some important findings, such as that China accounts for more than 40% of the external debt of 50 developing countries. We’ve embedded the document at the end of this post. The study is an ambitious undertaking, seeking to track China’s foreign lending from the start of the current regime, in 1949 to 2017. They identified 1,974 loans and 2,947 grants to 152 countries totaling...

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As Flood Risks Rise Across the US, It’s Time to Recognize the Limits of Levees

By Amahia Mallea, Associate Professor of History, Drake University. Originally published at The Conversation New Orleans averted disaster this month when tropical storm Barry delivered less rain in the Crescent City than forecasters originally feared. But Barry’s slog through Louisiana, Arkansas, Tennessee and Missouri is just the latest event in a year that has tested levees across the central U.S. Many U.S. cities rely on levees for protection from floods. There are more than 100,000 miles...

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The Numbers Are In, and Trump’s Tax Cuts Are a Bust

By Marshall Auerback, a market analyst and commentator. Produced by Economy for All, a project of the Independent Media Institute The most commonly heard refrain when Donald Trump and the GOP were seeking to pass some version of corporate tax reform went something like this: There are literally trillions of dollars trapped in offshore dollar deposits which, because of America’s uncompetitive tax rates, cannot be brought back home. Cut the corporate tax rate and get those dollars repatriated,...

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The ‘New Right’ Is Not a Reaction to Neoliberalism, but Its Offspring

By Lars Cornelissen, who holds a PhD in the Humanities and works as a researcher and editor for the Independent Social Research Foundation. Originally published at openDemocracy The ongoing and increasingly intense conservative backlash currently taking place across Europe is often understood as a populist reaction to neoliberal policy. The neoliberal assault on the welfare state, as for instance Chantal Mouffe has argued, has eroded post-war social security even as it destroyed people’s...

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Taxes for Revenue Are Obsolete

UserFriendly chided me for not having reproduced this classic, as I did for Michal Kalecki’s 1943 essay on the obstacles to reaching full employment. Apparently this classic article by Beardsley Ruml on why what we would now call a sovereign currency issuer doesn’t need taxes in order to spend doesn’t show up well on the Internet (for instance, links to full versions don’t have a preview, which is an impediment to sharing it on Twitter). So to encourage you to read and share it, we’re...

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Michael Hudson: De-Dollarizing the American Financial Empire

Yves here. Another meaty Michael Hudson interview on Guns and Butter. However, I have to vehemently disagree with the claim made by Bonnie Faulkner at the top of the discussion. No one holds guns to other countries’ heads to make them hold dollars. The reason the dollar is the reserve currency is the US is willing to export jobs via running persistent trade deficits.  The US moved away from  having rising worker wages as the key metric of sound economic policy in the 1970s, when labor was...

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Brexit: Will Boris or Won’t He?

ConservativeHome declared yesterday that their survey of Tory Party members finds that Boris Johnson has already won the leadership contest. He’s also embraced the proud UK leadership practice of promoting Brexit unicorns. A few examples: The EU will blink with him when it didn’t with Theresa May because Johnson serious about being willing to exit, declaring the odds of no deal as “a million to one”. The EU will give the UK what Johnson’s allies call a standstill, as in a transition period,...

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Transfer (Mis)pricing, the Jewel in Every Multinational Enterprise’s Crown

By Tanya Rawal-Jindia, a researcher at Tricontinental: Institute for Social Research. Originally published at openDemocracy as part of ourEconomy’s ‘Decolonising the economy’ series. Amazon.com Inc. was brought to court by the U.S. Internal Revenue Service (IRS) in 2017 for transfer pricing discrepancies. In 2005 and 2006, the multinational tech company had transferred $255 million in royalty payments to its tax haven in Luxembourg, but according to the IRS these royalty payments should have...

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Martin Wolf v. Trumponomics Whiffs Due to Fealty to Orthodoxy

There’s a lot not to like about what passes for Trump’s economic policy. But theFinancial Times Martin Wolf’s critique of it, in Donald Trump’s boom will prove to be hot air, leaves a lot to be desired. The fact that “boom” appears in the headline is a big tell. It’s a reasonable surmise that Trump will be re-elected unless the economy falls out of bed. Despite his long and ever-growing list of offenses and crappy policies, Trump is a master at keeping the spotlight turned on him. Democratic...

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Is Industrial Policy Finally Legitimate?

Yves here. It’s become more and more respectable in development economic circles to acknowledge that formerly taboo ideas like trade barriers and other forms of support to emerging industries are sound policy. The reversal by the IMF on the value of industrial policy is nevertheless significant. And that’s before you get to the fact that countries that lack explicit industrial policy wind up having ones by defaul By Jomo Kwame Sundaram, a former economics professor, was Assistant...

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