¿De verdad quieren estar al dia las EMPRESAS?

Should Business Travel Be Obsolete?

JAN 20, 2016

 

COLOMBO – Think about it: You can call, email, and even watch your counterparty on FaceTime, Skype, or GoToMeeting. So why do companies fork out more than $1.2 trillion a year – a full 1.5% of the world’s GDP – for international business travel?

The expense is not only huge; it is also growing – at 6.5% per year, almost twice the rate of global economic growth and almost as fast as information and telecommunication services. Computing power has moved from our laptops and cellphones to the cloud, and we are all better off for it. So why do we need to move brains instead of letting those brains stay put and just sending them bytes? Why waste precious work time in the air, at security checks, and waiting for our luggage?

Before anyone starts slashing travel budgets, let’s try to understand why we need to move people rather than information. Thanks to a research collaboration on inclusive growth with MasterCard and an anonymized donation of data to the Center for International Development at Harvard University, we are starting to shed some light on this mystery. In ongoing work with Dany Bahar, Michele Coscia, and Frank Neffke, we have been able to establish some interesting stylized facts.

More populous countries have more business travel in both directions, but the volume is less than proportional to their population: a country with 100% more population than another has only about 70% more business travel. This suggests that there are economies of scale in running businesses that favor large countries.

By contrast, a country with a per capita income that is 100% higher than another receives 130% more business travelers and sends 170% more people abroad. This means that business travel tends to grow more than proportionally with the level of development.

While businesspeople travel in order to trade or invest, more than half of international business travel seems to be related to the management of foreign subsidiaries. The global economy is increasingly characterized by global firms, which need to deploy their know-how to their different locations around the world. The data show that there is almost twice the amount of travel from headquarters to subsidiaries as there is in the opposite direction. Exporters also travel twice as much as importers.

But why do we need to move the brain, not just the bytes? I can think of at least two reasons.

First, the brain has a capacity to absorb information, identify patterns, and solve problems without us being aware of how it does it. That is why we can, for example, infer other people’s goals and intentions from facial expressions, body language, intonation, and other subtle indicators that we gather unconsciously.

When we attend a meeting in person, we can listen to the body language, not just the spoken word, and we can choose where to look, not just the particular angle that the video screen shows. As a consequence, we are better able to evaluate, empathize, and bond in person than we can with today’s telecom technologies.

Second, the brain is designed to work in parallel with other brains. Many problem-solving tasks require parallel computing with brains that possess different software and information but that can coordinate their thoughts. That is why we have design teams, advisory boards, inter-agency taskforces, and other forms of group interaction.

Conference calls try to match this interaction, but it is hard to speak in turn or to see one another’s expressions when someone is talking. Conference calls have trouble replicating the intricacy of human conscious and unconscious group interactions that are critical to solve problems and accomplish tasks.

The amount of travel should then be related to the amount of know-how that needs to be moved around. Countries differ in the amount of know-how they possess, and industries differ in the amount of know-how they require. Controlling for population and per capita income, travel is significantly more intense to and from countries and industries that possess or use more know-how.

The countries that account for the most travel abroad, controlling for population, are all in Western Europe: Germany, Denmark, Belgium, Norway, and the Netherlands. Outside of Europe, the most travel-intensive countries are Canada, Israel, Singapore, and the United States, a reflection of the fact that they need to deploy many brains to make use of their diverse know-how.

Interestingly, countries in the developing world differ substantially in the amount of know-how they receive through business travel. For example, countries such as South Africa, Bulgaria, Morocco, and Mauritius receive much more know-how than countries at similar levels of development such as Peru, Colombia, Chile, Indonesia, or Sri Lanka.

The fact that firms incur the cost of business travel suggests that, for some key tasks, it is easier to move brains than it is to move the relevant information to the brains. Moreover, the fact that business travel is growing faster than the global economy suggests that output is becoming more intensive in know-how and that know-how is diffusing through brain mobility. And, finally, the huge diversity of business travel intensity suggests that some countries are deploying or demanding much more know-how than others.

Rather than celebrate their thrift, countries that are out of the business travel loop should be worried. They may be missing out on more than frequent flyer miles.

 

Ricardo Hausmann, a former minister of planning of Venezuela and former Chief Economist of the Inter-American Development Bank, is Professor of the Practice of Economic Development at Harvard University, where he is also Director of the Center for International Development.

EUROPA o buenos estadistas o que el último apague la luz...

Pulling Europe Back from the Brink

 

 

 

JAN 20, 2016

 

DAVOS – In 2007, the United States caught a serious – and highly contagious – economic cold. Eight years later, it is finally making a convincing recovery – so convincing that last month the US Federal Reserve raised the country’s base interest rate for the first time in almost a decade. Europe, however, remains in bad shape. Not only has it not recovered from its post-2008 cold; beset by multiplying crises, it is now on the verge of developing pneumonia.

The best defense against pathogens is a strong immune system. And that is what Europe lacks today, in the form of political leaders who provide an inspiring and forward-looking vision to their people. With political disenchantment reaching levels not seen since the continent’s darkest times in the 1930s, the risk that Europe will succumb to the destructive forces of populism looms ever larger.

But it is too soon to give up hope; on the contrary, Europe is well positioned to succeed in the long term. To secure that future, Europe’s political class, rather than struggling to cope with crises as they arise, must begin to look at the big picture, anticipate and address challenges, and inspire people once again.

Is this too much to ask? History tells us that the answer is an emphatic no. Sixty years ago, with Europe’s economy reeling from the destruction caused by World War II, Europe’s leaders lifted their eyes above daily hardships to shape a more hopeful future, underpinned by European integration. That same vision and foresight is needed today, and the European Union, with its unmatched ability to facilitate regional cooperation, will remain essential.

Of course, there are some key differences between the circumstances that drove the EU’s creation and those that Europe’s leaders face today. Most notably, thanks to the EU, Europeans today have largely not endured war and absolute economic deprivation. With the dangers of demagoguery not embedded in their living memories, they are far more vulnerable to fear-mongering and false promises – illustrated in the growing influence of nationalist narratives and populist movements. Even worse, faced with an erosion of their voter base, many mainstream parties are playing catch-up with these destructive forces, engaging in EU-bashing of their own.

Clearly, the EU needs a new impetus that reflects twenty-first-century challenges and opportunities. But this will be virtually impossible to establish – and use to inspire people – until the EU and its member governments get a handle on the crises that are threatening to overwhelm them. That is why it is so urgent that Europe puts its economic house in order once and for all.

Such a reckoning will not be quick or easy, not least because it will require us to address the many issues that have been swept under the carpet over the years, as half-baked projects were foisted on the EU to implement. The foremost example of this is the partial economic and monetary union that has been around for nearly two decades, and that must now become a full union if it is to be successful and deliver results.

It is time for Europe’s leaders to break the decades-old habit of pursuing half-baked projects that blunt the symptoms of crises, and to implement real reforms that address the root causes. Only with a new approach – and tangible progress – can solidarity within Europe be regained.

My call for a renewed commitment to the EU does not stem from some federalist mantra. I would be the first to emphasize that political actors at all levels have a role to play in Europe, to the extent that they are able to implement policy effectively. And I would also recognize that EU institutions need reform, so that they manage the big picture, instead of the details.

Nonetheless, the EU and its institutions remain integral to efforts to respond to challenges that require a united front – challenges like those that Europe faces today.

If Europe’s leaders are to inspire their people to build a shared future, they must demonstrate an understanding of what that future has in store – and how to make the most of it. They should start by changing their attitudes and committing to working together to face present and future crises head-on. 

While we cannot know for certain what the next 10-20 years will bring, we have a few important clues. For one thing, there is the Fourth Industrial Revolution, which promises to transform our economies and societies in fundamental ways. Plenty of other transnational challenges – from addressing the root causes of the Middle East refugee crisis to implementing last month’s Paris agreement to mitigate climate change – are also in the cards.

 

It would be ironic if Europeans, enthralled by illusory promises of blissful national self-containment, threw away 60 years of deep cooperation at a moment when such cooperation is needed more than ever. Of course, self-destructive national behavior is not new. But, more often than not, leaders have managed to pull back from the brink. The key for Europe will be to deliver a coherent and compelling vision that justifies our need for cooperation in the decades ahead.

Martin Schulz is President of the European Parliament.

Feliz 2016 ???

The Europe Question in 2016

 JAN 4, 2016

 

NEW YORK – At the cusp of the new year, we face a world in which geopolitical and geo-economic risks are multiplying. Most of the Middle East is ablaze, stoking speculation that a long Sunni-Shia war (like Europe’s Thirty Years’ War between Catholics and Protestants) could be at hand. China’s rise is fueling a wide range of territorial disputes in Asia and challenging America’s strategic leadership in the region. And Russia’s invasion of Ukraine has apparently become a semi-frozen conflict, but one that could reignite at any time.

There is also the chance of another epidemic, as outbreaks of SARS, MERS, Ebola, and other infectious diseases have shown in recent years. Cyber-warfare is a looming threat as well, and non-state actors and groups are creating conflict and chaos from the Middle East to North and Sub-Saharan Africa. Last, but certainly not least, climate change is already causing significant damage, with extreme weather events becoming more frequent and lethal.

Yet it is Europe that may turn out to be the ground zero of geopolitics in 2016. For starters, a Greek exit from the eurozone may have been only postponed, not prevented, as pension and other structural reforms put the country on a collision course with its European creditors. “Grexit,” in turn, could be the beginning of the end of the monetary union, as investors would wonder which member – possibly even a core country (for example, Finland) – will be the next to leave.

If Grexit does occur, the United Kingdom’s exit from the EU may become more likely. Compared to a year ago, the probability of “Brexit” has increased, for several reasons. The recent terrorist attacks in Europe have made the UK even more isolationist, as has the migration crisis. Under Jeremy Corbyn’s leadership, Labour is more Euroskeptic. And Prime Minister David Cameron has painted himself into a corner by demanding EU reforms that even the Germans – who are sympathetic to the UK – cannot accept. To many in Britain, the EU looks like a sinking ship.

If Brexit were to occur, other dominos would fall. Scotland might decide to leave the UK, leading to the breakup of Britain. This could inspire other separatist movements – perhaps starting in Catalonia – to push even more forcefully for independence. And the EU’s Nordic members may decide that with the UK gone, they, too, would be better off leaving.

As for terrorism, the sheer number of homegrown jihadists means that the question for Europe is not whether another attack will occur, but when and where. And repeated attacks could sharply reduce business and consumer confidence and stall Europe’s fragile economic recovery.

Those who argue that the migration crisis also poses an existential threat to Europe are right. But the issue is not the million newcomers entering Europe in 2015. It is the 20 million more who are displaced, desperate, and seeking to escape violence, civil war, state failure, desertification, and economic collapse in large parts of the Middle East and Africa. If Europe is unable to find a coordinated solution to this problem and enforce a common external border, the Schengen Agreement will collapse and internal borders between the EU member states will reappear.

Meanwhile, austerity and reform fatigue on the eurozone periphery – and among non-eurozone EU members such as Hungary and Poland – is clashing with bailout fatigue in the core. Populist parties of the left and right – with their shared hostility to free trade, migration, Muslims, and globalization – are becoming more popular throughout Europe.

Syriza is in power in Greece; a leftist coalition is in office in Portugal; and the Spanish election could lead to significant political and policy uncertainty. Virulent anti-migrant, anti-Muslim parties are becoming more popular in Europe’s core, including the Netherlands, Denmark, Finland, and Sweden. In France, the far-right National Front came close to winning power in several regions earlier this month, and its leader, Marine Le Pen, may do well in the 2017 presidential election.

In Italy, moreover, Prime Minister Matteo Renzi is under attack by two anti-euro populist parties that have risen in opinion polls. And Chancellor Angela Merkel’s leadership is now under threat in Germany, following her courageous but controversial decision to allow almost a million asylum-seekers to enter the country.

In short, the distance between what Europe needs and what Europeans want is growing, and that gap could spell deep trouble in 2016. The eurozone and the EU are facing multiple threats, all of which call for a collective response. But what we are seeing is its member states increasingly adopting a national approach, thus undermining the possibility of Europe-wide solutions (the migration crisis is a tragic case in point).

Europe needs more cooperation, integration, risk sharing, and solidarity. Instead, Europeans appear to be embracing nationalism, balkanization, divergence, and disintegration.

Nouriel Roubini, a professor at NYU’s Stern School of Business and Chairman of Roubini Global Economics, was Senior Economist for International Affairs in the White House's Council of Economic Advisers during the Clinton Administration.

SIRIA y los intereses creados: Un poco de historia

Iran’s Syrian Power Grab and Saudi Arabia

RIYADH – Inviting Iran to the next round of talks on the Syria crisis in Vienna, Austria – an invitation that was reiterated last week – has far-reaching implications. In fact, Iran’s current government is attempting to overthrow a balance of power that has endured for some 1,400 years – and Saudi Arabia, as the cradle of the Muslim world, will not allow it.

The divide between Iran and Saudi Arabia, the Middle East’s most prominent Shia and Sunni powers, respectively, has deep roots. If we are to understand what is really happening in the Middle East today – not just in Syria – one must consider the origins of the Sunni-Shia schism, the Arab-Persian divide, and past struggles over the governance of Islam.

Islam was divided between Sunni and Shia after the prophet Muhammad died and a new successor had to be chosen. Most of his followers, who became known as Sunni Muslims, felt that the faithful should base their decision on ability, and supported the Muslim elders’ choice of Muhammad’s father-in-law, Abu Bakr. But a small dissident group, who would eventually become known as Shia Muslims, were adamant that the new caliph should be a blood relative of the prophet, and thus decided that Muhammad’s son-in-law and cousin Ali ibn Abi Talib (the fourth caliph, according to Sunnis) was his rightful successor. Today, 90% of all Muslims are Sunni, and 10% are Shia.
 

While this disagreement was playing out, so was the Muslim conquest of Persia, which began just a year after the prophet’s death in 632. The Persian Sassanid Empire, exhausted financially and militarily from decades of warfare with the Byzantine Empire, endured a decisive defeat in the Battle of Qadisiyyah in 636.

The next year, the Persian emperor, Yazdegerd III, fled to the border province of Khorasan and the Arabization of Persia began, with Persians taking Arab names and converting to Islam. By 651, almost all major urban centers in Persia were under Arab control, adding momentum to the process.

The mass conversion to Islam among Persians was the first step toward the establishment of the first caliphate, a political-religious state comprising all Muslim lands. At various times in history, caliphates have extended into Asia, Africa, and parts of Europe. The effort by various forces seeking to control or restore the caliphate is a recurrent theme throughout Islam’s history. The so-called Islamic State is only the latest example of this.

Until the year 1500, almost all Persians were Sunni Muslims. Then, Shah Ismail – the first Shah and the founder of the Safavid Dynasty – began a brutal policy of forcing Persian Muslims to become Shia, in order to distinguish his iteration of Persia’s empire from the more powerful Constantinople-based and fervently Sunni Ottoman caliphate.

This history clearly informs Iran’s actions today. As Shia Muslims, Iranians are a minority within the Muslim community, a reality that has caused them to feel persecuted. Rather than accept their minority status, various Iranian governments have attempted to establish their country’s hegemony in the Arab world.

Of course, Iran not only represents only a tiny minority of Muslims; Iranians are not Arabs. It is thus unfathomable that they would dictate to Arab countries in any capacity. But this has not stopped Iran’s government from attempting to commandeer the main levers of Islam, both politically and theologically. Using Arab countries’ Shia communities, it is trying to wield control over them, with the ultimate objective of taking over Islam’s two holiest sites, Mecca and Medina, over which the Saudi monarch exercises authority as the Custodian of the Two Holy Mosques.

As the Sunni world’s most influential country, Saudi Arabia knows that it must do what it takes to limit Iran. In 2011, a Saudi-led Gulf Cooperation Council coalition had to neutralize an Iran-sponsored Shia insurgency in Bahrain. This year in Yemen (a predominantly Sunni country), a Saudi-led coalition is fighting the Zaydi Shia Houthi rebelds, whom Iran armed in order to take over the country and gain a foothold on the Arabian Peninsula.

In Syria – a Sunni-majority country where, incidentally, a Sunni Muslim caliphate, the Umayyads, once prospered – Iran is spending billions of dollars to prop up President Bashar al-Assad’s regime, dominated by members of a minority Shia sect, the Alawites (historically known as Nusayris).

Actions by Assad’s supporters have so far caused more than 270,000 deaths, displaced over seven million people internally, forced nearly four million people to flee, and left close to 12 million in need of desperate assistance. They have enabled – indeed, fueled – the rise of the Islamic State, and with it a growing threat to the global order, as the successive terrorist attacks in Sharm el-Sheikh, Beirut, and Paris tragically have shown. Given this, Saudi Arabia’s leadership – regardless of what temporary results are achieved through the Vienna talks – will continue to work hard to ensure that Assad is removed from power and that the mayhem is finally brought to an end.

The terrorism, proxy wars, arms shipments, nuclear ambitions, and grandiose delusions emerging from Iran are part of an age-old struggle with which the Saudis have had enough. That is why King Salman is overseeing the greatest military acquisition and expansion program in Saudi Arabia’s history. And Saudi Arabia will not stop until Iran – and its Shia proxies – abandons its revolutionary fantasies and begins working to bring peace and stability to the Middle East and the wider Arab world. 
  

Nawaf Obaid is a visiting fellow at the Belfer Center for Science and International Affairs at Harvard University’s Kennedy School of Government.

El problema de Francia es el problema de toda EUROPA... (un homenaje a André Glucksmann)

Francia da la espalda a la realidad

The Economist se burlaba, a fines de marzo, de “la más frívola de las campañas electorales” y parodiaba en su portada el Desayuno en la hierba de Manet, al mostrar a Sarkozy y Hollande coqueteando en una pradera, vestidos de oscuro, con una bella joven desnuda. Tanto la izquierda como la derecha se indignaron con los anglosajones. Sarkozy criticó al Financial Times y el equipo de Hollande negó a los ultraliberales el derecho a insultar al pueblo francés. Pero, por desgracia para nuestros virtuosos candidatos, ese sentimiento de inutilidad está también extendido en la propia Francia: los votantes consideran que se trata de una campaña de lo más aburrida y la abstención puede alcanzar cifras sin precedentes. No hace ninguna falta ser fanáticamente liberal para constatar, como el arzobispo de París, André Vingt-trois, que “en el fondo, las cuestiones que abordan los candidatos son solo francofrancesas y clientelistas” (Le Monde, 8-9 de abril). Sí, se da la espalda a la realidad. Pero ¿a qué realidad? La campaña presidencial francesa se desarrolla a puerta cerrada. Y los candidatos, pequeños y grandes, con toda su rivalidad, se ponen de acuerdo para no traspasar los límites de esa puerta.

Si alguno habla de lo que ocurre fuera de las fronteras es para mejor vender su desglobalización sin concepto. Hasta los europeistas convencidos, de cualquier ideología, tratan de aguar su fervor y su audacia. Los temas de la Europa colador, burocrática y entregada a una austeridad empobrecedora, tienen éxito: los consejeros de nuestros príncipes se consideran autorizados por un cuerpo electoral supuestamente esquivo y hostil. No cabe duda de que la precariedad del poder adquisitivo, el aumento del paro, las deslocalizaciones de las herramientas de producción y la inseguridad son asuntos que inquietan, pero ¿de dónde surge la descabellada idea de hablar de estos problemas tan importantes como si los países vecinos y los demás continentes, hoy tan próximos, no existieran (a excepción de una Alemania que unas veces es maravillosa y otras veces es el hombre del saco)? Francia, quinta economía mundial, segunda de Europa, parece tan dispuesta a inventar el “capitalismo en un solo país” como los estalinistas, en su tiempo, a fantasear con la idea de la fortaleza socialista asediada, con puertas y ventanas cerradas

No somos más que sesenta y tantos millones de habitantes, en medio de los que pronto serán siete mil millones de seres humanos en plena mutación, siete mil millones que interfieren, se quiera o no, por las buenas o por las malas, en nuestra existencia. Seguí las primarias socialistas con gran atención y un asombro creciente. En tres sesiones televisadas de hora y media, ninguno de los candidatos se atrevió a hacer la menor reflexión sobre lo que ha dado en llamarse la “política exterior”. Algo que habría sido lógico en la logorrea de los líderes de extrema izquierda y extrema derecha, apóstoles de un proteccionismo de hierro y promotores de una nación solitaria y congelada, resultaba sorprendente en quienes aspiran a ejercer la función suprema; ¿o es que no van a viajar más que para hacer ofrendas florales?

Con una complicidad extraña y clandestina, los grandes partidos se ponen de acuerdo en no decir lo que piensan sobre las primaveras árabes, sus otoños ni sus posibles veranos; se ponen de acuerdo en no hablar jamás de Putin, su mandato vitalicio ni su emparejamiento con el PC chino en unos niveles de corrupción inimaginables; no dicen ni una palabra sobre Irán, su tiranía teocrática ni su bomba... Los apasionantes peligros de la actualidad internacional no deben agitar las aguas. Hemos conocido a un Sarkozy más locuaz, más enérgico (en Georgia, en Libia). En su discurso de Grenoble, con sus críticas sobre la invasión de los gitanos y otros marginados sin tierra —una falta moral y un error estratégico—, se desliza en el jardín de Marine Le Pen. ¿Se ha olvidado de 2007 y su exigencia de una política mundial que asegurase el respeto a los derechos humanos? Hoy, Hollande lleva la voz cantante, y los 10 años que transcurrió en la secretaría del PS, resolviendo querellas internas, demuestran que el mundo exterior sigue siendo para él completamente exterior.

En un quid pro quo, la izquierda y la derecha se otorgan mutuamente una plena y total absolución. El hecho de que Nicolas Sarkozy venda buques de guerra y de desembarco (Mistral) al pacífico ejército ruso, ávido de reconquistar el perímetro del imperio, no parece preocupar a Hollande; por lo menos, no dice ni una palabra al respecto. Los camaradas Mubarak, Ben Alí y Gbagbo siguen siendo miembros de la Internacional Socialista hasta que caen derrocados, pero en la UMP no sueltan prenda, sino que fingen ignorarlo. Lo que pasa más allá de nuestro patio trasero no nos importa nada.

La función real —el supuesto dominio reservado— del presidente de la República Francesa consiste en la gestión de los intereses y los ideales de Francia en el mundo. Sarkozy la ha ejercido, a veces con fortuna, a veces sin ella, a veces, perdido. ¿No ha extraído ninguna enseñanza? ¿Niguna reflexión que transmitirnos? ¿Y qué piensa de ello Hollande, encerrado en su mutismo? Hoy, en Siria, El Asad aniquila una ciudad detrás de otra, China y Rusia bloquean cualquier decisión de la ONU y, mientras tanto, Teherán y Moscú proveen de armas al asesino. ¿No hay nada que decir de este eje dañino? ¡Basta ya! El elector francés no asume responsabilidades, está infantilizado. Dando vueltas sin parar, deslumbrado por Bolloré, Le Fouquet’s, hasta la nausea. Mientras tanto, la tierra sigue girando, con sus buenas y sus malas noticias.

Acurrucado en sus vergüenzas familiares, el país renuncia. Angela Merkel, por sí sola, no va a salvar Europa, tan propensa —digna heredera del canciller Schroeder, vendido a Gazprom— a dar prioridad a la alianza con Rusia, su petróleo y su gas, en perjuicio de los “pequeños europeos” del este, que el Kremlin pretende volver a colonizar. No será Obama, por sí solo, quien resuelva los conflictos y las guerras que se ciernen, con toda su prisa en retirarse porque cree que así minimiza los riesgos. Y, por desgracia, no es la Francia autista que nos ofrecen la que sabrá afrontar los peligros y las oportunidades de una sociedad mundial intrínsecamente globalizada.

Desde el hundimiento del comunismo en el mundo, como realidad y como aspiración, la nueva globalización lo inunda todo. Trastorna equilibrios geopolíticos, sociales y mentales que se remontan a milenios y se proyecta en la producción y los intercambios de miles de millones de individuos, chinos, indios, brasileños, etcétera. Un maremoto así no tiene nada de idílico. La explotación salvaje, el nihilismo y la destrucción están en pleno apogeo, pero, al mismo tiempo, poblaciones inmensas observan su situación con ojos desengañados. Se rebelan por su supervivencia, su dignidad, su futuro. Empiezan a hacer caer a déspotas que se creían garantes del orden mediante la fuerza de las armas, la mentira, la prevaricación y los prejuicios étnicos y religiosos. Hasta los faraones rojos de Pekín se preocupan, mientras que la cleptocracia de Putin hace aguas.

Acabemos con las lamentaciones. Después de haber inventado la guerra total y la revolución totalitaria, Europa, en la segunda mitad del siglo pasado, elaboró con sumo cuidado el antídoto, el espíritu de una disidencia contra las dictaduras que se extendió desde Praga (Carta 77) hasta Pekín (Carta 08). La Unión Europea encarna ante el mundo una zona privilegiada de democracia y prosperidad. Una prosperidad relativa y frágil, sin duda. Una democracia que aún hay que perfeccionar, extender y defender. No está mal como programa para el siglo actual, lejos del decadentismo absurdo y suicida de las izquierdas y las derechas francesas.

Abramos las ventanas, que un viento de libertad despierte las valentías y arrastre los tabúes, ¿es que acaso Francia debe darse por vencida y encerrarse en vida?

André Glucksmann es filósofo francés.

21 de Abril, 2012

¿Qué pasará si Estados Unidos sube los tipos de interés?

Confronting the Coming Liquidity Crisis

NOV 6, 2015
 

SAO PAULO – This month, G-20 leaders will meet in Antalya, Turkey, for their tenth summit since the 2007 global financial crisis. But, despite all of these meetings – high-profile events involving top decision-makers from the world’s most influential economies – no real progress has been made toward reforming the international financial architecture. Indeed, the group has not seriously engaged with the subject since the 2010 summit in Seoul. Put simply, the G-20 is failing in its primary and original purpose of enhancing global financial and monetary stability.

A big part of the problem is that the G-20 agenda has become increasingly congested over the years. At a time of looming financial upheaval, the G-20 must stop attempting to tackle a broad array of issues simultaneously – a goal that has proved impossible – and go back to basics.

The United States Federal Reserve is now preparing to raise interest rates, which it has kept near zero since the crisis. While monetary-policy tightening may be necessary, it risks triggering a serious liquidity crisis in developing countries, with a major impact on economic growth and development. That is why, at this month’s G-20 summit, participants must focus on providing a credible institutional backstop for the difficult times ahead.

Specifically, the G-20 should move to empower the International Monetary Fund, both by pushing it to do more with its existing powers and by championing institutional reform. Raghuram Rajan, the governor of India’s central bank, emphasized this at the recent annual meetings of the IMF and the World Bank in Lima, Peru, when he called for the Fund to build a sustainable global safety net to help countries in future liquidity crisis.

The necessary institutional arrangement already exists: the IMF’s Special Drawing Rights (SDR) department. Within this department, official entities can exchange SDRs – the IMF’s own international reserve asset – for other currencies. Moreover, the IMF can designate a country with a strong balance-of-payments position to provide the liquidity that another member needs. Through this so-called “designation mechanism” – which has never been used – the IMF can ensure certainty of access to global currencies in times of crisis.

Of course, if the IMF’s SDR department is to become a global liquidity hub capable of mitigating future crises, reform is vital. Ideally, major powers would support efforts to strengthen the IMF. But the US has so far been unwilling to do so, with domestic partisan politics spurring Congress to block the relevant reforms.

While the G-20 should not give up on IMF-strengthening reforms, it should hedge its bets. Specifically, it should work with a “coalition of the willing” – including the major emerging economies, concerned advanced countries, and other developing countries – to create an institutional mechanism with which to respond effectively to the next global liquidity crisis.

One obvious option would be to replicate the institutional design of the SDR department by incorporating it in an agreement among the coalition countries. The Bank for International Settlements, which was the counterparty in currency swaps under the Bretton Woods par value system in the 1960s, could be the manager of this system.

This approach undoubtedly has major shortcomings. Indeed, the key advantage of the IMF’s SDR department – that it is a quasi-universal and government-driven system whereby currencies are exchanged with reliable “collateral” (the SDR) – would be lost.

But the perfect should not be made the enemy of the good. As long as an ideal system is out of reach, an imperfect option will have to do. With the risk of a liquidity crisis intensifying, and the existing international financial architecture ill-equipped to respond to such a crisis, doing nothing is not an option.

In recent years, the international financial system has become increasingly fragmented, exemplified in the proliferation of bilateral and multilateral currency-swap arrangements. For example, the Chiang Mai Initiative Multilateralization involves the ASEAN countries, plus China, Japan, and South Korea. And the Contingent Reserve Arrangement (CRA) was created by the BRICS countries (Brazil, China, India, Russia, and South Africa).

Swap contracts involve pre-committed resources, which are not transferred to an international organization with a specific institutional mission. Instead, foreign-exchange reserves – that is, liquidity in currencies accepted for international payments – are held in national agencies until a swap’s activation.

This means that there is no guarantee that, in the event of a crisis, a central bank will actually provide the swap line it has pledged, at least not without attaching political strings. In the CRA, for example, members can opt out of providing support – and can request early repayment if a balance-of-payments need arises.

Clearly, the world’s ever-expanding network of currency-swap arrangements is far from a reliable mechanism for responding to crisis. This is particularly problematic for the emerging economies, which are especially vulnerable now.

Turkey, which currently holds the G-20 presidency, and China, which will take over next year, should have plenty of motivation to demand action to create safeguards against today’s liquidity risks. Beyond urging the US to approve IMF governance reforms, both countries should be hard at work building a coalition of the willing and designing an effective crisis-response mechanism.

So far, Turkey seems to be falling short, promoting an overcrowded and ineffective agenda. One hopes that its leaders come to their senses fast, so that the upcoming summit can produce the results that past summits have failed to provide – and that the world needs more than ever.

Camila Villard Duran, a professor of law at the University of São Paulo, is an Oxford-Princeton Global Leaders Fellow in the Global Economic Governance Program, University of Oxford.

De Eurófilos a Eurófobos

Europe Has Lost its Way 

 

NOV 4, 2015

WASHINGTON, DC – Europe’s response to the strategic challenges it is facing – Russian aggression in Ukraine, refugees fleeing violence in the Middle East, disorder in North Africa – leaves the impression that its leaders have no idea what to do. And indeed, they may not – a reality that needs to be acknowledged, not papered over. 

Simply put, the European Union’s stagnant economy is conditioning its response to the external pressures it confronts; internal crisis has left EU leaders little room for maneuver. Fortunately, Europe has the means to address this crisis, if it can summon the wisdom and the political will.

The origins of the EU’s problems lie in its response to the 2008 global financial crisis: two years of large-scale fiscal stimulus. While this did little for growth, it resulted in crippling public debt. Seven years later, EU output per person is no higher than it was at the start of the crisis. Meanwhile, average public debt has soared to 87% of GDP, leaving little space for policy flexibility or innovation. 

In hindsight, it is all too obvious what should have been done. Greece, which carried out the biggest fiscal stimulus, is the country whose economy has suffered the most damage. Its depression continues, whereas countries like Latvia, Lithuania, and Estonia, which carried out early, radical fiscal adjustments and liberalized their economies, are enjoying strong growth. 

Furthermore, the slow pace of European decision-making has compounded Greece’s troubles. When it comes to economic policy, a fast, faulty decision is often better than inaction. Instead of resolving the Greek financial crisis quickly, EU leaders allowed it to crowd out discussion of other issues for five long years. Meanwhile, Greece limped along, never taking the decisive measures that might have restored confidence.

With its attention focused on macroeconomics, the EU neglected to take the measures that would have put economic growth back on track: freeing up markets, cutting spending (rather than raising taxes), and, above all, further developing its greatest asset, the single European market.

Little has changed since Italian economists Alberto Alesina and Francesco Giavazzi noted, nearly a decade ago, that, “Without serious, deep, and comprehensive reforms, Europe will inexorably decline, both economically and politically.” They warned that, “Absent profound change, in 20 or 30 years the share of Europe [in world output] will be significantly lower than it is today, and, perhaps more important, its political influence will be much trimmed.”

Indeed, a World Bank report on European growth in 2012 summed up the situation as follows: “Aging Europeans are being squeezed between innovative Americans and efficient Asians.”

The chief culprits for Europe’s underperformance are well known: high taxes, too many and bad regulations, the absence of key markets, and high public expenditures. And there is only one reason why European governments spend so much: excessive social protection. As the World Bank observed, “Western European governments spend about 10% of GDP more than the United States, Canada, and Japan. The difference in social protection spending is 9% of GDP.”

In order to fund this spending, revenues must be raised. And, because it is difficult to tax capital efficiently, Europe has imposed exorbitant levies on labor. Across the continent, but especially in southern Europe, taxes and strict labor-market regulations keep unemployment high, at 11% of the labor force, and dissuade Europeans from investing in their education. The natural consequences are too little employment, too little investment in sophisticated education, too little innovation, and minimal increases in productivity.

Most striking is European backwardness in high-tech development and innovation. By almost any measure, most of Europe looks pitiable. Of the 50 best universities in the world, according to the Shanghai list and the Times Higher Education Supplement list, some 30 are American, six or seven are British, and only a handful are to be found in continental Europe. A half-dozen northern European countries can compete with the US when it comes to research and development spending and patents granted, but the south and east of Europe lag far behind.

Meanwhile, the EU has yet to open its markets for business services and digital trade, on which the American economy thrives, even though services account for about 70% of GDP in most EU countries. In 2006, the European Commission issued a directive on the liberalization of trade in services, but major countries – particularly Germany – have refused to implement it. The absence of services and digital markets harms the development of a modern economy in Europe. It is not by chance that American giants like Apple, Amazon, and Google rule the world of high-tech.

There is nothing inevitable about Europe’s malaise, just as there is nothing quintessentially European about having excessive social transfers. Serious European governments – from Ireland to Poland – have successfully addressed the problem. The rest of the EU should not only follow suit; they should also cut income and payroll taxes and liberalize their labor markets.

Fundamental economic reforms are usually implemented only after a severe crisis, as was the case in Britain in the late 1970s, in Sweden and Finland in the early 1990s, and in Eastern Europe after the collapse of communism in 1989. The EU has wasted the opportunities afforded by the 2008 global financial crisis and the subsequent euro crisis. Rather than making the difficult changes that would enable strong recovery, Europe’s policymakers have weighed down the economy with more spending and debt.

The EU will continue to flounder until it recognizes its mistakes and begins to carry out the reforms its economy needs. Only by putting the continent firmly back on the path of growth will Europe’s leaders be able to address the external challenges they now confront.

Anders Åslund is a senior fellow at the Atlantic Council in Washington, DC, and the author, most recently, of Ukraine: What Went Wrong and How to Fix It.