Economic Growth Program: Latest Articles

Democratizing Capital

Ron Tang — Thu, 20 Mar 2008 05:53:00 -0400

Below is a longer version of the article published in The Nation. For the version appearing in The Nation, please click here.

Historical analogies are never exact. Yet many of the choices we have before us today are similar to ones that an earlier generation of progressives faced as the 1932 election approached. As we do today, the progressives of the 20th century confronted a society beset by a huge gap between classes and an economy laid flat by the bursting of the speculative excesses of the previous decade. To be sure, our economy is nowhere near Depression levels… more

Watching Sovereign Wealth

Ron Tang — Thu, 28 Feb 2008 00:00:00 -0500

When the adjectives most often used to describe you are "secretive," "opaque" and "mysterious," you've got an image problem. Such is the predicament of sovereign wealth funds, the government-controlled investment vehicles, often in authoritarian states, that have become the bane of Western politicians. Yesterday, the European Commission became the latest body to propose transparency guidelines for these funds.

But the good news for sovereign wealth funds is that increased disclosure and transparency may actually be a win-win for everyone. A little openness can go a long way.

Market participants and regulators would benefit by gaining some insight into potential contagion risks and… more

Undebated Challenges

Articles — Mon, 19 Nov 2007 16:35:00 -0500

The most damaging part of the Bush foreign policy legacy is not the precipitous decline in American power and influence brought about by the disastrous Iraq occupation. It is the way the Administration’s "war on terror" and its neoimperial project in the Middle East have distorted our vision of the world.

They magnify out of all proportion what should at worst be minor threats to our national security and ignore much larger developments, such as the extraordinary economic rise of China and India, which are having a much more profound effect on the American way of life.

Just how distorted our… more

Mission Accomplished

Articles — Thu, 15 Nov 2007 17:30:00 -0500

Perhaps it's time to add the European Bank for Reconstruction and Development to that list of things that, like houseguests and fish, can overstay their welcome. The bank now strays so far from its original remit that it risks spoiling the legacy of its earlier successes. The EBRD should quit while ahead, declare victory and be privatized.

At its pinnacle, the EBRD was a triumph of financial statecraft. Established in 1990 with funding from the U.S., the EU and other governments, it provided financing to companies in postcommunist Central and Eastern Europe at a time when the private sector shunned them.… more

Sustaining an Infrastructure for Success

Articles — Wed, 17 Oct 2007 14:34:00 -0400

In the wake of infrastructure related tragedies that struck Minnesota and New Orleans, political leaders have demonstrated once again that they do not understand the benefits of public investment. Mistakenly seeing only the financial burden of public investment and ignoring the future returns, they have failed to allocate enough public funds to adequately repair America’s roads, bridges, railways and electric grids. As a consequence, America is stopped short of reaching its full economic potential.

The costs of our crumbling infrastructure include wasted fuel, traffic delays and clogged ports. Congestion on America’s roads results in losses between $70 to 78 billion every… more

Inside Track: The Financialization of Foreign Policy

Articles — Wed, 17 Oct 2007 08:29:00 -0400

Over the first half of 2007, central banks in the world’s emerging economies accumulated over $600 billion of new reserves. That’s double the total reserve position of the International Monetary Fund (IMF) -- an institution whose mission used to include preventing the collapse of these same governments, and whose new managing director recently raised questions about the body’s “relevance and legitimacy.” Over the same period, China, Russia and Japan joined the list of governments establishing “sovereign wealth funds”, whose worldwide assets now approach $3 trillion. The U.S. Treasury, meanwhile, is focusing its attention on the Strategic Economic Dialogue with China,… more

Public Investment Works

Articles — Sun, 30 Sep 2007 10:16:00 -0400

An important debate over fiscal policy is beginning to take place within the Democratic Party. For the past 15 years, deficit hawks within the party have argued that addressing America’s fiscal challenges should take priority over our public investment needs, suggesting that, in effect, we cannot afford to increase public investment until we have reduced the federal deficit.

But there is an alternate view, holding that the deficit hawk position neither accurately reflects America’s true economic strength nor represents good policy in light of the very significant changes that have occurred in the economy over the past decade… more

Capital Warfare

adminn — Thu, 29 Mar 2007 12:56:00 -0400

With Iraq, Afghanistan and the war on terror dominating headlines in Washington these days, there's a real danger that U.S. policymakers will lose sight of the other major war currently being fought around the world -- the war for capital. While other countries are fighting with all they've got, many in the U.S. remain complacent, indifferent or antagonistic. Big mistake. There's a clear relationship between global financial leadership and global influence, and if history is any guide, Americans can't assume that today's financial powerhouse will be tomorrow's.

The war for capital is a three-front battle, encompassing competition among sources, markets and… more

A Goldilocks World Economy?

Articles — Wed, 31 Jan 2007 09:22:00 -0500

Over the past decade and half, two developments in the world economy have come together to create conditions for what could be a new era of faster economic growth and rising prosperity. One development involves the integration of China, India and the former Soviet Union into the global economy. The inclusion of these three populous regions into the global economy has created what economists call positive supply-side shocks, resulting in surpluses in labor, capital, and productive capacity. The most obvious impact of China, India, and the former Soviet Union has been on the world's labor market. Their entry into the… more

The New Economic Map of America

Articles — Thu, 30 Nov 2006 23:40:00 -0500

Asked which American cities have been the biggest economic winners of the new millennium, almost anyone reading a daily newspaper or watching a nightly news show would name places like New York, San Francisco, Boston, and Washington, D.C., where condo and single-family home prices have surged and the wealthy enjoyed a bonanza by leveraging their real estate assets.

In fact, the true hotspots are scattered across a landscape all but unknown to the Manhattan-based media. Soaring condo prices are a minor and probably transitory phenomenon. In the new economic geography of America, most of the winners are in fly-over country; the… more

Boomtowns '06

Articles — Tue, 16 May 2006 16:20:01 -0400

As part of our annual report, Inc. studied 393 population centers across the nation, identifying job creation and other signs of business vitality. What did we find? The big cities are idling, and the real entrepreneurial hot spots are on the periphery -- where low costs and favorable regulatory environments make it possible to thrive.

Which metropolitan areas are really booming? Here, you'll find a searchable database, the full 2006 rankings broken down by small, medium, and large cities, an interactive map, stories explaining why -- and where -- companies are flourishing today, and much more.

Bellingham, Washington; St. George,… more

Our Allies In Iran

Articles — Thu, 03 Nov 2005 00:00:00 -0500

When Iran's new president, Mahmoud Ahmadinejad, called last week for Israel to be "wiped off the map," he raised fears not only abroad but also at home, particularly among Iran's sizeable, democratically minded middle class. The new president's confrontational tone threatens to deepen the isolation of Iran's democrats, pushing them further behind his long shadow. Western powers have a dual challenge: to find a way to engage this population even as they struggle to address the new president's inflammatory rhetoric.

By the time Mr. Ahmadinejad was elected in June, a sustained assault by hard-liners had left Iranian democrats disoriented and… more

Reconnecting to the World

Articles — Wed, 29 Jun 2005 03:00:00 -0400

For the sake of party unity, many Democrats last year put aside their differences with John Kerry's foreign policy positions, in particular his tortured support for the war in Iraq. Situating the party as close to the Bush agenda as possible without actually embracing it, it was argued, was a reasonable price to pay for taking back the White House. The gambit -- of being long on national security and the "war on terror" and short on the economy and jobs -- failed, however, to persuade working-class and suburban voters in places like Ohio and Missouri, reinforcing the public view… more

The Market Shall Set You Free

Articles — Fri, 28 Jan 2005 00:00:00 -0500

Last week President Bush again laid out a faith-based view of the world and again took heat for it. Human history, the president said in his inaugural address, "has a visible direction, set by liberty and the author of liberty." Accordingly, America will pursue "the ultimate goal of ending tyranny in our world" -- and Mr. Bush has "complete confidence" of success. Critics on the left and right warned against grounding foreign policy in such nanve optimism (a world without tyrants?) and such unbounded faith.

But the problem with the speech is actually the opposite. Mr. Bush has… more

Dignity, Most of All

Articles — Thu, 21 Oct 2004 00:00:00 -0400

With little media notice and marginal scholarly interest, a powerful and potentially transformative movement is taking shape across the Middle East. The movement cuts across religious, ethnic and gender lines. It threatens ruling elites. It poses new challenges to the social order. It makes new and urgent demands of civil society. It feeds and animates other movements. And it will reshape the region as we know it, far more than the US invasion of Iraq.

It's the most important movement in the Middle East, and it doesn't even have a name, a political infrastructure or militant supporters. Let's call it… more

Mortgage Markets Will Strengthen Arab Middle Classes

Articles — Fri, 17 Sep 2004 00:00:00 -0400

Political theorists don't agree on much, but they tend toward a healthy majority on one issue: large, vibrant middle classes spur demands for greater democracy and help sustain democratic institutions.

In recent history, countries that have successfully transitioned to democratic pluralism tend to be those with strong middle classes. South Korea, Taiwan, Japan, Mexico and Chile all moved toward greater democracy after developing their economies and building middle classes. The Eastern European states that have shown the healthiest democratic transition -- Poland, Hungary, the Czech Republic -- also have the strongest middle classes. Meanwhile, support for democracy in the… more

Where Have All the Big Ideas Gone?

Articles — Sun, 15 Aug 2004 00:00:00 -0400

Each era in American history is defined by a couple of big ideas: the Homestead Act, the GI Bill, Social Security, the Marshall Plan or the race to space. Such major social or economic innovations are usually advanced by our political leaders in response to national turning points. Few would disagree that the United States has reached another historical juncture. Where, then, have all the big -- and good -- ideas gone?

The paucity of innovative thinking is particularly evident in this presidential campaign. President Bush has a couple of big ideas -- … more

The Arab World Needs a Development Bank

Articles — Mon, 09 Aug 2004 00:00:00 -0400

To understand the most pressing crisis facing the future of the Middle East, place a job advertisement in a local newspaper. In Tehran, an ad seeking a clerk for a Western company prompted more than 1,000 applications. Included among them: a PhD in economics, a medical doctor, dozens of software engineers and hundreds of Iran's top university graduates. In Cairo, a senior accountant told me he was shocked at the highly educated who applied for a low-level position with his company.

All across the region, high unemployment, widespread underemployment, and an overwhelmingly young population are putting tremendous pressure on strained labor… more

Keeping our Commitments to American Workers on International Trade

Articles — Thu, 11 Mar 2004 00:00:00 -0500

In 2002, after a nearly decade-long deadlock, Congress passed the most sweeping international trade legislation in 15 years.

By giving the president authority to negotiate new trade agreements, the United States has begun negotiating free-trade agreements with more than a dozen countries. President Bush has already signed free-trade agreements with Chile and Singapore, and he expects to sign at least two more this year.

In exchange for trade negotiating authority, Congress and the administration committed to assist those workers who lose their jobs due to increased imports and shifts in production. Unfortunately, our commitment to these workers has… more

Trade Adjustment Assistance and Offshore Sourcing

Articles — Thu, 19 Feb 2004 00:00:00 -0500

For more than 40 years, the United States has recognized that -- though international trade and global commerce are certainly in the best interests of the United States -- there are those workers that are hurt by trade and globalization in general. During the Kennedy administration, to respond to the needs of those workers the Trade Adjustment Assistance (TAA) program was created.

In 2002, the Congress agreed to extend new authority to the Administration to negotiate new trade agreements, but the Congress insisted on a major rewrite of TAA be included in the same legislation to ensure that… more