Our Word is Our Weapon

It’s been an interesting couple of weeks for the debate about trade and development. Christian Aid and the new Make Poverty History coalition have launched campaigns and (in Christian Aid’s case) detailed analyses of the situation.

They have been met with a chorus of disapproval from a certain quarter:

• “Economic idiots“, said Stephen Pollard
• “Unrealistic and superficial“, said Global Growth Org
• “The problem is not that we have too much free trade: we have too little“, said the Adam Smith Institute

These people seem to want us to believe that free trade, and free trade alone, will lift the poorest people in the world out of poverty. These people are wrong.

Before I explain how these people are wrong, it should be pointed out that Christian Aid’s advertising campaign is a strategic mistake, especially when compared with their mostly sensible and insightful report on trade and development. It’s a mistake because for rhetorical purposes it lines up behind the British, American and almost every other rich country government in calling ‘free trade’ that which is not ‘free trade’. So-called ‘free trade’, which has totally failed to reduce poverty, is in fact simple trade liberalisation in poor countries. Trade liberalisation in poor countries has failed, but in calling it ‘free trade’, Christian Aid allow their critics to accuse them of being nasty, lying, ‘anti-prosperity’ types without having to actually address any of their substantive points.

Anyway. What is wrong with the argument that free trade and free trade alone will lift the poorest people out of poverty?

Briefly, what is wrong with it is that the poorest countries are the least able to benefit from free trade and may be the most reliant on certain forms of ‘unfree’ trade, such as the trade in subsidised food. For more details, let’s turn to the very interesting and very authoritative recent paper on “Ending Africa’s Poverty Trap” by Sachs and others (since if the argument is invalid for Africa, then it is simply invalid).

Taking a needs-based approach, the paper arrives at an annual cost for meeting the internationally-agreed Millennium Development Goals (which include the goal of halving poverty by 2015) of around 20 to 30 per cent of GDP for Sub-Saharan African countries. After a detailed review of the economic literature estimating the costs and benefits to Africa of world trade liberalisation, the authors conclude:

Even if the Doha trade negotiations yielded African countries the most optimistic of estimated outcomes, these countries’ benefits would likely not exceed 1 or 2 percent of GDP a year. Although these benefits would be nontrivial in scale and important for long-term economic development, they would be an order of magnitude less than the level of resources required to achieve the MDGs in the poorest countries.

What is more, the benefits from trade liberalisation “are not a substitute for the sustained increases in ODA needed” to fund the public investments required to meet the MDGs.

And that’s it, really. Some African countries will gain from trade liberalisation. Some will probably lose. The gains will not outweigh the losses enough to lift half of the poor Africans out of poverty by 2015 or anytime soon after that. African countries - and poor countries everywhere - need carefully phased and targeted trade liberalisation and greatly increased aid.

[Edit: that last bit isn’t quite right. What I should say is that they need access to rich country markets, carefully phased and targeted liberalisation of their own trade regimes, and greatly increased aid]

The longer we go without stumping up the money necessary to pay for the Millennium Development Goals, the more expensive it will become. Now Jeffrey Sachs and others estimate the costs at around $100bn extra in aid per year, up from previous estimates of $50bn extra. Okay, so the difference is partly to do with new calculation methods, but still, we can’t expect the price to come down by refusing to pay.

Given that the rich countries have completely failed to live up to their promises to significantly increase aid when the bill was only $50bn more, it’s hard to see them reaching for their pockets now that it’s twice as high (even though the total aid required would still translate into less than the 0.7% of national income used by rich countries as the benchmark of choice). Some may decide that it’s not worth paying one-tenth of what we spend on weapons to save millions of lives. Others, with some persuasion, may realise that the MDGs are a historic opportunity, a chance, cheap at the price, to massively reduce the burden on future generations everywhere of poverty and all that goes with it.

This must be a political decision, made as a result of political pressure. As the world’s biggest donors in dollar terms but smallest in proportions of national wealth, that pressure must primarily be brought to bear on the USA and Japan. The simplest way to put it is that if we don’t pay up now to reduce poverty, disease and underdevelopment, we will eventually find ourselves paying much more, one way or another.

Hat-tip to Adam Smithee for the link.

Some people have taken issue with the MakePovertyHistory campaign, apparently under the impression that this is all part of Bono’s publicity drive for his forthcoming album. It’s a fairly feeble attack, I think, and I’ve told them so in comments. I’ll try to post something a bit more substantial here in the next few days.

[EDIT: I originally wrote ‘nasty people’, in a kind of failed attempt to be tongue-in-cheek. However it probably didn’t look that way. For what it’s worth, the GGO people don’t seem to be nasty … we just disagree]

Speaking of institutional reform and growth, I note there’s been a lot of coverage of the World Bank’s Doing Business in 2005 report, including some facile comparison-of-extremes by the usual suspects:

Incorporating a business takes two days in Canada, but 153 in Mozambique. Sacking a worker in Guatemala costs a firm three years’ worth of wages, compared with almost nothing in New Zealand … In Haiti, for example, it takes 203 days to register a company, which is 201 days longer than in Australia. In Sierra Leone it costs 1,268% of average income, compared with nothing in Denmark. To register in Ethiopia, a would-be entrepreneur must deposit the equivalent of 18 years’ average income in a bank account, which is then frozen.

While there’s obviously lots of room for improvement, some complacent commentators have concluded that the poverty of third world countries is simply entirely their own fault. But it’s not that simple. Look at the Doing Business figures for Vietnam: on almost every indicator, it is worse than both the average OECD country and the rest of its region. Yet it is growing remarkably fast and lifting millions out of poverty.

The kind of red-tape described in Doing Business plays some part in restricting business activity and keeping growth down, but it’s not a massive one. And obviously, it is partly due to corruption, which is in turn partly a function of poverty itself. Countries like Vietnam may demonstrate that development can take place in the context of very high levels of red tape, which then melt away with the advance of prosperity.

Or not. I don’t really know - it’s just a theory.

“This illustrates a broader point: there is no unique, non-context specific way of achieving desirable institutional outcomes.”

It may not be poetry, but it’s an important point. The Washington Consensus is dead as a detailed policy prescription, but its spirit lives on in the attempts to impose homogenous, ‘market friendly’ institutions on poor countries in the name of ‘good governance’. Dani Rodrik is having none of it:

China provided market incentives through two-track economic reform rather than across-the-board liberalization, which is usually the standard advice. In agriculture and industry, price efficiency was achieved not by abolishing quotas and planned allocations, but by allowing producers to trade at market prices at the margin. In international trade, openness was achieved not by reducing import barriers, but by creating special economic zones with different rules than those applied to domestic production

He is also alive to the idea that different policies best fit different stages of the development process, which seems to evade a lot of commentators on the subject:

large-scale institutional transformation is hardly ever a prerequisite for jump-starting growth … we need to distinguish between stimulating economic growth and sustaining it. Solid institutions are much more important for the latter than for the former. Once growth is set into motion, it becomes easier to maintain a virtuous cycle with rapid growth and institutional transformation driving each other.

There is a difference between the kind of sensibly market-friendly reforms followed in China’s case and the big-bang approach favoured by the ‘neoliberal’ school:

Ricardo Hausmann, Lant Pritchett, and I recently identified and examined more than 80 episodes of growth acceleration - in which a country increased its growth rate by 2% or more for at least seven years - in the period since 1950. The surprise was not only that there were so many cases, but that the vast majority seemed unrelated to conventional economic reforms, such as liberalization of trade and prices. To the extent that we can identify growth triggers, they seem to be related to relaxing constraints that held back private economic activity.

Thanks to the brand spanking new Adam Smithee blog for the link. I like this site: so far there’s been a very busy week’s worth of top-notch posts and fine linkage. To the blogroll with it.

In November 2001, the US State Department compiled a list, complete with handy map, of the countries where Al-Qaeda were known to have operated. There were 45 of them, and they spanned the globe from Australia to Alaska, and from Russia to South Africa. Iraq was not one of them.

Today, Al-Qaeda members/jihadists/associates are not only ‘operating’ in occuppied Iraq, they are having the time of their lives there. So even if Bush was wrong to say two years ago that Al-Qaeda were operating in Iraq, at least he’s right now.

[Edit: I found the link on Kevin Drum’s Political Animal blog]

In a speech on Thursday, John Prescott condemned his Tory predecessors for following “A Government policy which was against social housing”. This policy, he said, meant:
“- Fewer houses in the public sector
- Higher rents
- More on housing benefit
- More homelessness
- More repossessions and negative equity.
- And ever more revenue subsidy”.

How has Labour performed on these measures since 1997? Let’s take a look at the government’s own figures (most of the links below are to Excel tables on www.odpm.gov.uk)

- Homes in the public sector: lower. Total of local authority and housing association dwelling stock in the UK is down 6% since 1997 to 5.2 million.

- Rents (in the social sector): higher. The mean rent after housing benefit rose 24% between 1997/98 and 2002/03.

- Households on housing benefit: fractionally lower. 64% of households renting from local authorities are on HB, down from 65% in 1997, and for housing associations its a drop from 64% to 60%. Note that the 1997 numbers were already down on 1995.

- Homelessness: Much higher. 35% more households were accepted as homeless in 2003 over 1997, and there were more than twice as many homeless households put up in temporary accommodation.

- Repossessions and negative equity: down significantly. Repossessions in 2002 were down 64% on 1997. I don’t have figures for negative equity but given the soaring housing market it must be lower now than in 1997.

- Revenue subsidy: higher. I’m not 100% sure this is the right measure, but these figures indicate to me that government subsidies to local authority housing revenue accounts rose by 19% between 1997 and 2001 (I think that’s current prices, but it’s still a real-terms rise).

So there you have it. On his own criteria, Prescott and Labour get one and a half out of six. Looks like we still have a government that’s against social housing.

A very good opinion piece in the FT today by Kevin Watkins, new director of the Human Development Report office at the UNDP:

Africa’s burden of debt is still far too heavy
Published: September 22 2004 03:00 | Last updated: September 22 2004 03:00

Twenty years ago, Julius Nyerere, then president of Tanzania, asked his country’s creditors a pointed question: “Should we really starve our children to pay our debts?” It is a question that northern government finance ministers might usefully reflect upon in Washington next month at the annual meeting of the International Monetary Fund and the World Bank.
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The prevailing wisdom is that Africa’s debt crisis is ready to be consigned to the history books. Eight years have passed since rich countries agreed a joint World Bank-IMF scheme - the Heavily Indebted Poor Countries (HIPC) Initiative - to reduce debt to manageable levels. Much has been achieved. But reports of the end of the debt crisis are wildly exaggerated. Across much of Africa, that crisis is continuing to undermine growth and reinforce poverty.

It was not supposed to be like this. When it was launched in 1996, the HIPC Initiative was heralded as a breakthrough. It created for the first time a debt reduction framework that covered all creditors, including multilateral institutions, setting a “sustainability ceiling” on the ratio of debt stock to export earnings.

Some of the numbers are undeniably impressive. Currently, 27 countries, all but four African, are benefiting from debt reduction commitments valued at $34bn (in net present value terms).

The debt relief premium has been put to good use. According to the World Bank, public spending on health and education has risen by almost 2 per cent of gross domestic product in countries receiving debt relief. Savings on debt repayments have helped finance free primary education in Tanzania and Uganda, anti-HIV/Aids programmes in Senegal and rural development in Ethiopia.

The bad news is that headline numbers on debt stock reduction obscure other parts of the balance sheet - notably the columns dealing with debt servicing. Collectively, the African coun tries now covered by the HIPC Initiative still spend $2bn annually on debt repayments. On average, creditors absorb 12 per cent of government revenue after debt relief, rising to more than 25 per cent for Zambia.

Claims that the HIPC Initiative has left Africa with a sustainable debt are hard to square with reality. Creditors point to Ethiopia’s recent $2bn debt stock reduction package as evidence of their generosity. Yet this year the country, with almost half of its population living in extreme poverty, will still spend $100m on debt servicing, more than it spends on health.

So what has gone wrong with the HIPC Initiative? Two problems stand out. First, debt relief levels are inadequate. That is morally indefensible - and inconsistent with commitments made by rich countries to help the poorest countries meet the Millennium Development Goals and their overarching target of halving extreme poverty by 2015.

The second problem is one of eligibility. Debt relief is frequently delayed or cut off as a result of countries failing to comply with IMF loan conditions. Some conditionality is clearly justified, notably when it comes to budget transparency. But using debt relief as a lever for achieving deep structural reforms in complex policy areas - such as privatisation, civil service pay and utility management - is not justified.

Some creditors now recognise the case for deeper debt reduction. The US and Britain have conceded that a full write-off of debt owed to the IMF and the World Bank may be necessary. But deeper debt reduction will require additional financing. The alternative is a zero-sum game of transferring aid resources into debt relief.

Robbing Peter to pay Paul is neither sensible nor equitable - and it is unnecessary. The IMF could finance increased debt relief through the simple expedient of selling gold, for example, and donors could expand funding for the International Development Association, the World Bank’s soft-loan arm. Unfortunately, concrete proposals in these areas are conspicuous by their absence.

The British government has pledged to put African poverty at the centre of next year’s agenda for the Group of Eight highly industrialised countries. Action to cancel the unpayable debt at the heart of that poverty will be vital to a successful outcome. The IMF-World Bank meeting provides G8 finance ministers with an opportunity to prepare the ground. They could usefully start by acknowledging that the debt problem has not gone away and agreeing a timetable for reforming a debt relief initiative that is failing some of the world’s poorest people.

The writer is director of the UN Development Programme’s Human Development Report.

Funny movements on the debt front recently. For months now, the US has been trying to get other rich creditor countries to agree massive reductions in debt for its new best friend Iraq (the US wants a 95% cut in the $40bn owed by Iraq to the ‘Paris Club’, which if I remember correctly would be enough to wipe out for good all the debts owed to the Paris Club by a few dozen ‘Highly Indebted Poor Countries’). Other countries, notably France and Germany, have been holding out, ostensibly because they cannot understand why Iraq should be given more debt relief than the poorest countries in the world.

Now, the US is apparently going to call their bluff by seeking to cancel much more HIPC debt, specifically that owed to the IMF and World Bank:

The plan, disclosed by members of aid groups and government officials, would dramatically increase previous debt relief programs for at least 27 poor nations such as Uganda, Bolivia, and Ethiopia. The US Treasury Department, which is putting the plan forward for discussion at a meeting in Paris this week, contends that the current approach has been too slow and piecemeal to truly free those nations from the burden of repaying money borrowed from the World Bank, International Monetary Fund, and other global lenders. The Treasury is also proposing that for very poor countries, all future IMF and World Bank assistance come in the form of grants rather than loans.

The IMF and World Bank will probably resist (claiming poverty, or unfairness on behalf of indebted but non-HIPC countries), but they can well afford it. And since HIPC is failing to do the business as it stands, more clearly needs to be done for the worst-off countries immediately before attention can turn to those in somewhat less of a pinch. 27 HIPC countries are still paying around $800m a year in debt service, and even the IMF/World Bank admit that their debts subsequent to full presently agreed reduction will be ‘unsustainable’.

It’s unclear at the moment what this means for Iraq’s debts, but as far as I can see the Paris Club has agreed to cancel at least 50% of what’s owed to them.

If this is really going to happen, there might be a battle over who gets to announce it (and thus take credit). Tony Blair would no doubt like to chalk it up as an achievement of his forthcoming ‘year of development’ in 2005, but Bush would no doubt welcome the chance to trumpet some real progress for Iraq and Africa.

Jeffrey Sachs and various others explain Africa’s poverty trap (124 page pdf file).

They begin by rejecting the claim that Africa is poor primarily because of a ‘governance crisis’:

Many parts of Africa are well governed even though stuck in poverty … poorer countries have systematically poorer governance measures than richer countries, since good governance itself requires real resources … [but there is no] evidence that Africa’s governance, on average, is worse than elsewhere once we control for income levels.

The real problem is that “tropical Africa, even the well-governed parts, is stuck in a poverty trap, too poor to achieve robust, high levels of economic growth and, in many places, simply too poor to grow at all”. In brief, the poverty trap works like this:

Africa’s extreme poverty leads to low national saving rates, which in turn lead to low or negative economic growth rates. Low domestic saving is not offset by large inflows of private foreign capital, for example foreign direct investment, because Africa’s poor infrastructure and weak human capital discourage such inflows.

The lesson here seems to be that telling Africa to open its markets and hope for the best will simply not cut it. Africa needs a big boost in public investments to create the kind of growth in human and physical capital that will attract investment and allow the private sector to develop.

The rest of the report goes something like this:

We begin by outlining our theory of Africa’s poverty trap. This is fol-lowed by a discussion of the structural conditions and history that have led the continent into such a trap. Following that, we identify how a big push in key investments could enable Africa to meet the MDGs, and how that, in turn, would help to extricate Africa from its current development trap. We then estimate the financial costs required to meet the MDGs, and we suggest how those costs could be allocated between domestic resources in Africa (both public and private) and increased ODA. Finally, we propose a new framework for donor-African relations to underpin a big push designed to meet the MDGs.

This looks like very good stuff. *Sigh* - my must-read pile gets ever bigger.

It’s probably too much to hope that the outcome of US presidential election will hinge on something as ‘nuanced’ and boring as economic policy, but for what it’s worth here’s Kash at Angry Bear with a brief run-down of John Kerry’s economic policy (in the interests of fairness, I’d like to post a link to Bush’s economic policies, but he hasn’t got any). For more detail on Kerry’s cornerstone policy on health insurance, here’s Kash again.

In a previous post, I pointed out how the claim from the Daily Telegraph and Adam Smith Institute that “Those on £40,000 a year now pay 50% in tax” was false. It’s not just me who thought so: in his latest column for the Times (reproduced here on his website), David Smith says the figures (from accountants Smith & Williamson) are “not credible”:

Only by assuming that our guinea pig bought a house in 1997 and did so again in 2004 — incurring the full weight of Brown’s stamp-duty increases — did Smith & Williamson get to its numbers. On that basis, assuming “Mr£50,000” stays put next year, his tax burden would plunge. Leaving out stamp duty from the calculations gives an increase in the tax burden from 32% to 35.1%. Smoothing the increase in stamp duty produces a rise from 32.4% to 37.1%.

This is a long way from the fifteen-point increase in the tax burden proclaimed by the Telegraph, the Adam Smith Institute, oh and the Conservative party too (“Labour’s ‘terrifying’ tax grab”). But have any of them admitted their mistake? Well, I alerted the ASI and the Conservatives to the error, but neither have either replied or published corrections, so one can only assume they’re deliberately misleading people.

[EDIT: update update! Now Adam Smith Institute blog admin-person Alex Singleton has added a comment attempting to refute the claim that “the table which appeared in the print edition of the Telegraph seems to show a miscalculation in how stamp duty was incorporated into the figures, by counting stamp duty as something that’s paid every year”. But he simply restates the error: “The table includes the figure of £7590pa in the table for Stamp Duty Land Tax, saying that this is ‘Based on a 130pc rise in property value from Proviser and average house move every seven years from Halifax’.” Yes, and the problem is that they seem to treat the full stamp duty increase as an annual tax increase, which it clearly isn’t. If the household spread their stamp duty payments over seven years and still paid £7590 every year, they must have bought a house for at least £1.3m (4% of £1.3m is roughly equal to 7 x £7590)

It’s not just me saying this - the Treasury and, as noted above, David Smith have both pointed it out. The Adam Smith Insitute either don’t understand or are still deliberately misleading their readers.]

I don’t know anyone who actually thinks its a good thing that tens of thousands of people are killed every day by poverty. I know some people who aren’t aware that this is happening, though, and I know that even more, myself included, know but sometimes try to forget.

Now a very big group of people are going to make it their business to ensure that we can’t and won’t forget anymore. They‘ve formed the MakePovertyHistory coalition to put pressure on Britain to make 2005, when we hold the leadership of both the G8 and the EU, a year of breakthroughs on development.

The coalition is calling for change under three headings: trade, debt and aid. Every policy they suggest has the virtue of being simple, fair and cheap but will nevertheless make a significant impact on reducing poverty (more details in this Word file).

We lose our claim to the label of ‘civilisation’ when we refuse to lift a finger to stop millions of people dying from poverty. Fortunately, we in the UK happen to live in a very rich democracy, so there is no excuse not to apply the pressure where it counts: on our politicians. The MakePovertyHistory coalition is going to be making a lot of noise over the next while, and one way to get them off your back and out of your conscience is to start leading our leaders, so just write to your MP or cabinet minister and let them know what you think. The system, believe it or not, sometimes works if you press the buttons hard enough.

I posted recently on how most Americans think that the US spends too much on foreign aid, but apparently only because they hugely overestimate the size of the US aid budget.

Well, it turns out that Britons might be just as misguided on aid: according to a MORI poll from 2001, “Britons believe foreign aid represents about 9% of their government’s expenditure (although two-fifths were unable to give an estimate). In fact, the actual level in 1999 was just 0.7%. When told this, most respondents (53%) believed it to be too low, a third (32%) felt it was about right and 7% felt that it was too high.”

Hacks at the Daily Telegraph and Adam Smith Institute excitedly announced recently that everybody’s taxes are much higher now than they were in 1997, with the middle classes feeling especially squeezed: “Those on £40,000 a year now pay 50% in tax, up from the 35% it was 7 years ago”.

I don’t read the Torygraph much, but experience tells me that anything the ASI says is as likely as not false. So I did a little digging, which is apparently more than they did, as if they had examined the figures a bit more closely they’d have realised how bogus that catchy headline was (but I suppose they would probably have run with it anyway).

The Telegraph story says the figures come from accountants Smith & Williamson, and includes a table with a breakdown of income and taxation for 1997 and 2004.

The first thing to note is that, contrary to the ASI’s implication, the table does not tell you what happened to the average £40,000 earner, but instead focuses on a particular sub-group: a single-earner household with two children under 19. It was also assumed that this household lived in Guildford, Surrey, had bought a new house in the last year, having been at their previous home for seven years, moving from council tax Band D to Band F, and owned a Ford Mondeo and drove 8,000 miles a year. So not quite as typical as you might have thought.

The income of this archetypal Middle England household (including bank interest and child benefits, and adjusted for inflation and average earnings rise) rose by £2861 between 1997 and 2004. The total of tax and national insurance rose by £1981. The total bill from VAT, duties and insurance premium tax rose by £55. At this point, they are paying a couple of % more of their income in tax, but are still better off to the tune of about £800.

Now we come to the interesting part. The figure for council tax in 1997 is £757, and in 2004 its £1230. But this increase is largely due to the assumption that the household has recently moved to a much more expensive house (band D to band F), which certainly won’t be the case for everyone.

Next we have stamp duty. According to the table, this household is paying £7590 in stamp duty a year. But as far as I can see this translates into either a £250k house purchase every year, or the duty from a £1.3m purchase spread over 7 years. Clearly neither option makes sense in terms of the hypothetical family, so it must be a mistake. But the increase in stamp duty alone is £6280, accounting for 70% of the total ‘tax increase’ between 1997 and 2004. To echo the remarks of a Treasury spokesman, I’m glad these guys aren’t my accountants.

By repeating this flawed analysis so uncritically, the Telegraph and Adam Smith Institute are either being very careless or perpetuating a fraud. In some ways this is a shame, as there is an argument to be made that Labour are letting the rising market bring more and more people into the top bracket for stamp duty, the tax paid on the house purchase price. But what this one-sided argument misses is that the incredible rise of the housing market under Labour has brought massive wealth increases to a lot of people through no great skill or effort on their part. For example, the Bank of England estimates that in 2004 homeowners took out around £60 billion in ‘mortgate equity release’, (i.e. borrowing secured on but not spent on housing), several times higher than the levels of the late 1990s . This is basically a massive increase in borrowing power brought about by the rising market. Add in the huge boost house values have given to the wealth of the middle and upper classes, and the rise in stamp duty receipts since 1997 seems minor.

Bear in mind that I’m not basing this on extensive research or anything - it’s really just a generalisation borne of too many hours poring over the details of a foreign election. But anyway:

The quality of blogs may be inversely proportional to the quality of the political scene. In the UK, where the political discourse is comparatively polite, honest and substantive, the blogosphere (including this site) is comparatively dull. In the US, where the political agenda is dominated by a malicious, extreme and stunningly deceitful Republican heirarchy, the blogosphere positively crackles. Perhaps partly as a result of the imbalance in the wider political culture (and probably partly as a result of my own political leanings), most of the examples I care to mention are of the ‘liberal’ persuasion: Brad de Long, Kevin Drum, Angry Bear, and of course the great Fafblog. Andrew Sullivan, meanwhile, is just about the only exampe so far I can find to a conservative blogger with intelligence and credibility. Maybe conservative blogging would get better with a Kerry victory, though I wouldn’t get my hopes up.

It’s hard not to see development of a high-quality decentralised political culture as a reaction to the almost complete destruction of the central American political system. The parliament no longer talks, the President no longer leads, the media no longer inform, and the system has lost the ability to foster political thought and debate.

Interesting … just as the polls seem to show that the Republican Convention (summary: America is in much more danger now than it was when George W. Bush came to power, so we should place our trust in him) has swung some highly swingable voters, credible Republicans and sympathisers seem to be heading for the door.

Here’s Andrew Sullivan:

People like me who became conservatives because of the appeal of smaller government and more domestic freedom are now marginalized in a big-government party, bent on using the power of the state to direct people’s lives, give them meaning and protect them from all dangers … the only difference between Republicans and Democrats now is that the Bush Republicans believe in Big Insolvent Government and the Kerry Democrats believe in Big Solvent Government.

And here’s Johan Norberg:

Bush has finished the Republicans’ transition from Reagan’s small government-conservatism, to national greatness- and big government-conservatism … He gave us no indication on how he would control spending and balance the budget. He only objects to the first part of the Democrats’ tax-and-spend-policies.

Behold Globalis, a very clever site that generates a world map for any of dozens of social and economic indicators.

This one, for example, shows each country’s energy consumption per capita:

You can also view comparative charts for each statistic, and trends over time. Endless fun for nerds like myself.

Globalis seems to be a product of something called the Global Virtual University.

For reasons I intend to explore in a later post, I believe we can best measure social and economic progress in a country by looking at its level of child poverty. Handily enough, there’s a publication from UNICEF here that does exactly that for the OECD countries. Of particular interest is the table showing the proportion of children in each country falling below a single universal and absolute poverty line:

Interestingly, it shows that children in Luxembourg and the Scandinavian countries are much less likely to be poor than those in the ‘Anglo-Saxon’ countries, Southern Europe and the former Soviet bloc.

Why should someone who earns $8 a day in India be considered well above the poverty line, but in America well below it? If we treat everyone equally, we shouldapply the kind of poverty standards we use in the rich countries to the whole world. Lant Pritchett finds that if we do use a figure of $15 a day, roughly equivalent to the US poverty line, around 70% of the world’s population is ‘poor’.