Here's my Top 10 items from around the Internet over the last week or so. As always, we welcome your additions in the comments below or via email to email@example.com.
My must read is #5 on the human faces of inequality in the United States.
I'm all in favour of people working in jobs for money and paying their taxes. It's what makes our worlds go around.
So I found the detail about the ages of people in work in the 2013 Census fascinating. Statstics NZ released the detail this week, shortly after Winston Peters, 69, declared he would stand again in Northland in 2017 at the age of 72.
It turns out the number of super-annuitants working full time has trebled to 68,652 over the last decade. That includes 1,620 people working full time in paid employment over the age of 80.
That's brilliant. All sorts of studies show people working past the age of 65 are generally healthier, more socially connected and likely to lead longer, better lives.
It also means they're paying taxes, and hopefully enough to pay for the New Zealand Superannuation benefit they'll also be receiving as an entitlement.
It does however mean they may well be working essentially tax-free after receiving their benefit, at least if they earn less than NZ$60,000 or so.
As the numbers of working super-annuitants grow and the stress of paying that benefit grows for the wider taxpaying public (under the age of 65) then the questions will grow again about retirement ages and means testing.
I don't think though that should turn into calls for those over 65 to retire or stop working. I think the more the better. I'm planning to soldier on as long as I can. I suspect also that I'll have to to because by the time I hit hit 65 in 17 years time I'll need to keep working to keep building up savings (and to pay taxes for the all the NZ Super being paid…)
The fastest growing line of Government spending for years now has been NZ Superannuation.
2. Woof, woof, wizz, wizz – Here's the world's first drone sheepdog. I grew up watching A Dog's Show and our family pet was a huntaway called Rags who was the best rounder-upper of cows we'd ever had.
So this is fascinating in some ways, and sad in others. I can imagine the 11 year old sons and daughters of sheep farmers standing on a ridge with a remote control rounding up the flock in future. Or more likely staring at a screen in the house at the front of the farm. Sad to think they'll miss out on running around the farm with a dog like Rags.
3. Quite a shock – A generation's view of the world was shaped by the quadrupling of the price of oil in 1972. Last year's halving of the oil price may have a similarly transformative effect on many parts of the global economy and polity.
Here's a useful thinkpiece from The Atlantic on the meaning of the fall in the oil price last year.
Nowhere are the second-order consequences of cratering oil prices more varied, important, and unpredictable than in the Middle East. In a Financial Timesarticle in February titled “ISIS struggles to balance books as finances are squeezed,” reporter Erika Solomon wrote, “The world’s richest jihadi group is not as flush as it once was. It has cut spending on fuel and bread subsidies, while increasingly shaking down locals for cash. Fighters themselves may be feeling the squeeze, too.”
Analyst Torbjorn Soltvedt estimated that the militant group’s revenue from selling oil had dropped to $300,000 per day, down from between $1 million and $2 million a day in 2014. “I don’t think [the oil-revenue decline] will lead to [the Islamic State’s] collapse. … But it might accelerate their implosion,” Soltvedt told Solomon. Iran, meanwhile, has entered into negotiations with world powers over its nuclear program for a variety of reasons. But the fact that Iran is one of the world’s hardest-hit oil producers is surely one of them.
4. Untenable – PIMCO, the world's biggest bond fund, reckons the euro zone is untenable. It points to some interesting history.
PIMCO used the example of the Latin and Scandinavian unions in the 19th century, which lasted an average of 50 years before breaking up, to illustrate how monetary unions were incompatible with sovereignty.
"You need to reach some sort of political agreement about how to share fiscal resources around the zone. We're a long, long, long way from designing that and getting the political backing for it," he said.
"So while you're waiting for that and you've got low growth, and high unemployment, you run the risk of letting these anti-euro parties to the forefront."
5. How much inequality can a democracy bear? – Jill Lepore has a good hard look at the science of measuring inequality in this New Yorker piece that also asks how long America's democracy can handle the record gap between rich and poor. But she also recounts some of the human stories now being collected in a bunch of books.
Aside from the anecdotes, the bulk of “Our Kids” is an omnibus of social-science scholarship. The book’s chief and authoritative contribution is its careful presentation for a popular audience of important work on the erosion, in the past half century, of so many forms of social, economic, and political support for families, schools, and communities—with consequences that amount to what Silva and others have called the “privatization of risk.” The social-science literature includes a complicated debate about the relationship between inequality of outcome (differences of income and of wealth) and inequality of opportunity (differences in education and employment). To most readers, these issues are more familiar as a political disagreement.
In American politics, Democrats are more likely to talk about both kinds of inequality, while Republicans tend to confine their concern to inequality of opportunity. According to Putnam, “All sides in this debate agree on one thing, however: as income inequality expands, kids from more privileged backgrounds start and probably finish further and further ahead of their less privileged peers, even if the rate of socioeconomic mobility is unchanged.” He also takes the position, again relying on a considerable body of scholarship, that, “quite apart from the danger that the opportunity gap poses to American prosperity, it also undermines our democracy.”
6. The Cephlapod is back – The FT's Gary Silverman looks at how Goldman Sachs' connections to US Presidential contenders are becoming an issue. By the way, a Cephlapod is a squid…
Questions are being raised about Goldman because so many of the leading White House contenders have close family ties to the Wall Street bank. Ted Cruz’s wife, Hillary Clinton’s son-in-law and Chris Christie’s brother, for example, all have worked at Goldman.
Why so many relatives of Goldmanistas are leading politicians is hard to say. Conspiracy theorists, I am afraid, will see it as evidence that Matt Taibbi of Rolling Stone was right when he compared the bank to a “great vampire squid wrapped around the face of humanity” in 2010. I suspect it probably has more to do with the very small world of the US elite. But, whatever the case, the spectre of that celebrated cephalopod is once again influencing national politics, at least for now, with consequences for Goldman and other banks.
7. If only… – Brad Delong chronicles the response of the world's policy elite to the Great Recession of 2008 and 2009 and how the triumph of the monetarists through the 80s and 90s is responsible for the timidity of that response.
Admitting that the monetarist cure was inadequate would have required mainstream economists to swim against the neoliberal currents of our age. It would have required acknowledging that the causes of the Great Depression ran much deeper than a technocratic failure to manage the money supply properly. And doing that would have been tantamount to admitting the merits of social democracy and recognizing that the failure of markets can sometimes be a greater danger than the inefficiency of governments.
The result was a host of policies based not on evidence, but on inadequately examined ideas. And we are still paying the price for that intellectual failure today.
Let’s tackle the history first. In general, trade deals today are markedly different from those made in the decades following World War II, when negotiations focused on lowering tariffs. As tariffs came down on all sides, trade expanded, and each country could develop the sectors in which it had strengths and as a result, standards of living would rise. Some jobs would be lost, but new jobs would be created.
Today, the purpose of trade agreements is different. Tariffs around the world are already low. The focus has shifted to “nontariff barriers,” and the most important of these — for the corporate interests pushing agreements — are regulations. Huge multinational corporations complain that inconsistent regulations make business costly. But most of the regulations, even if they are imperfect, are there for a reason: to protect workers, consumers, the economy and the environment.
What’s more, those regulations were often put in place by governments responding to the democratic demands of their citizens. Trade agreements’ new boosters euphemistically claim that they are simply after regulatory harmonization, a clean-sounding phrase that implies an innocent plan to promote efficiency. One could, of course, get regulatory harmonization by strengthening regulations to the highest standards everywhere. But when corporations call for harmonization, what they really mean is a race to the bottom.