Politics

Germany set to trial Universal Basic Income scheme

Starting this week, 120 Germans will receive a form of universal basic income every month for three years. The volunteers will get monthly payments of €1,200, or about $1,400, as part of a study testing a universal basic income. The study will compare the experiences of the 120 volunteers with 1,380 people who do not receive the payments. Supporters say it would reduce inequality and improve well-being, while opponents argue it would be too expensive and discourage work. Germany is about to become the latest country to trial a universal basic income, starting a three-year study of how it affects the economy and recipients’ well-being. As part of the study, 120 people will receive €1,200, or about $1,430, each month for three years — an amount just above Germany’s poverty line — and researchers will compare their experiences with another group of 1,380 people who will not receive the payments. The study, conducted by the German Institute for Economic Research, has been funded by 140,000 private donations. All participants will be asked to complete questionnaires about their lives, work, and emotional state to see whether a basic income has had a significant impact. Universal basic income is the idea that a government should pay a lump sum of money to each of its citizens, usually once a month, regardless of their income or employment status, effectively replacing means-tested benefits. Its proponents argue that it would reduce inequality and improve well-being by providing people more financial security. Its opponents say it would be too expensive and discourage people from going to work. The idea has gained traction in recent years amid financial crises and growing inequality in some Western countries. Jürgen Schupp, who is leading the study, told the German newspaper Der Spiegel that it would improve the debate about universal basic income […]

How do economic crises end?

The Issue We are now in the acute economic phase of a crisis that is unprecedented in modern times — a health crisis from the coronavirus pandemic that has sparked a follow-on economic crisis. The virus represents both a supply shock (as people are forced not to work and supply chains are disrupted by the need for social distancing) and a demand shock (as incomes plunge, people are unable to go out, and economic uncertainty surges). Moreover, these shocks have put severe strains on the financial system. Against this backdrop, the economic outlook has darkened considerably since the pandemic burst into public view, and many macro forecasters now expect a deep and painful recession as economic activity is abruptly curtailed. While much remains unknown about the spread and severity of the coronavirus crisis, and even though there are clear differences from the current situation, we can look at two past economic crises — the Financial Crisis and the Great Depression — to draw lessons. History suggests that two ingredients are needed to stanch the acute phase of an economic crisis; a transparent resolution of the underlying cause of the crisis and a dramatic economic policy response that both mitigates the economic damage and causes a shift in business and consumer sentiment. History suggests two ingredients are needed to stanch the acute phase of an economic crisis; a resolution of the underlying cause and a dramatic economic policy response that mitigates the economic damage and causes a shift in sentiment. The Facts: The Great Depression began with a financial panic that was ignited by the stock market collapse in October 1929. That panic quickly led to a run on banks and many bank failures. Indeed, the number of banks operating in the United States at the end of 1933 was down by almost half from its […]

Meet our Young Global Leaders for 2020

Mariah Levin, Head of the Forum of Young Global Leaders, World Economic Forum. Each year, the World Economic Forum names its new YGLs Young Global Leaders are under the age of 40. Influential people who want to make the world a better place. What does the winner of the FIFA Women’s World Cup have in common with the prime minister of Finland? They are both young leaders who gained international repute over the last 12 months. And now Megan Rapinoe and Sanna Marin have been recognised as Young Global Leaders by the World Economic Forum – joining a community of people dedicated to changing the world for the better. Each year, the Forum of Young Global Leaders identifies the world’s most promising leaders under the age of 40 – people driving innovation for positive change across civil society, arts, culture, government and business. By connecting them to a community of remarkable peers and investing further in their leadership abilities, the aim is to create a ripple effect over five years that benefits their organisations and the world. Here are some of the 115 YGLs that make up the class of 2020: Megan Rapinoe – As co-captain of the US women’s soccer team, Rapinow lifted the 2019 FIFA World Cup. Off the field, she advocates for gender equality, including equal pay in her sport, and speaks out on diversity and inclusion. Jesús Cepeda – Chief Executive Officer of OneSmart City, a company that uses blockchain and artificial intelligence to help city authorities provide digital services. Cepeda hopes the technology will create greener cities and stronger institutions in line with the UN goals on sustainable development. Larry Madowo – The BBC Africa Business Editor launched six new business TV shows for African audiences in English, French and Swahili. Madowo is also an on-air correspondent on BBC radio and […]

Australia’s COVID-19 opportunity

COVID-19’s impact on the Australian labour market has been dramatic and multifaceted. Some sectors of the economy have been almost completely shut down by government order. The demand in many industries has collapsed, while a few others have seen an increase. As many as one million jobs are under threat. Such estimates came before the government’s extraordinary JobKeeper scheme, which will undoubtedly reduce this figure considerably. Despite that, many who will keep their jobs may not actually have much to do at work. The economy will be in “hibernation” or on “life-support” for some time to come. We’ve gained about 1 billion hours of time If the economy has shed the equivalent of one million jobs, then we’ve gained about one billion hours of available time, and that’s just over the next six months. The full impact of the crisis could be even larger. What should we do with this time? Many of us are spending more time with children who are no longer physically at school. Some of us are doing tasks which our older relatives previously did. Netflix is also a compelling option. From a human capital perspective, the crisis presents a unique economic opportunity to re-train and up-skill Australia’s labour force. The Australian government jumped on board on Sunday, announcing funding that would cut the price of new six-month, remotely delivered diplomas and graduate certificates in nursing, teaching, health, information technology and science provided by universities and private tertiary institutions. Economists have long observed that investment in human capital (education, skills) tends to increase during recessions, because there aren’t as many well-paying alternatives. We can use it to get ahead of the curve In the current recession, the opportunities for training are greater. Even those of us who will remain employed but have little to do can use the time to invest in training. Our […]

A four-day working week will not only improve wellbeing – it could save the planet

A shorter working week has re-emerged as a prominent subject of political and economic discussion in recent years, with the TUC, the Green Party and Labour taking a reduction of working hours seriously as a policy that could increase workers’ well-being, boost productivity and face the challenges of automation. In Germany, the IG Metall, Europe’s largest industrial union, led a strike last year that mobilized 1.5 million workers and won the option to individually reduce working time from 35-hours per week to 28-hours per week, while securing the option to return to full-time employment afterwards. While a shorter working week is often framed as a tool to fix a broken economic model that is working for the few, rather than for the many, the increased interest in working time reductions coincides with the emergence of powerful global movements that highlight another crisis that is facing humanity today: the depletion of resources, the degradation of our natural environments and above all the rapid heating-up of our planet. Here, too, pressing issues of intra- and intergenerational justice emerge, with people in the global south and the poor more likely to suffer the fall-out of an economic system that largely favours the capital-owning class in the global north. For decades now, the sustainability debate has largely been dominated by calls for ethical consumption, rather than facing the systemic root of the problem: an economic system that prioritises profit-making over workers’ well-being and even the preservation of the very natural basis of our collective life. To develop a sustainable economic model, it is becoming clear that we need to break with the imperatives imposed by the necessities of capital accumulation (endless “growth”) and find a way to provide a decent standard of living while honouring planetary boundaries. At the same time, our current working time and […]

A new network of leaders changing the system together

For over 20 years, the Schwab Foundation for Social Entrepreneurship has recognised social entrepreneurs as a new breed of leader – values-driven, inclusive, compassionate, entrepreneurial individuals who develop sustainable new models in business, social development and environmental initiatives. They have been at the forefront of R&D for society and civilization, accelerating how we solve problems and imagining new futures through experimentation, iteration and practice. In these two decades, we have curated and gathered over 350 leading social entrepreneurs from 70 countries in the Schwab Foundation community and embedded them into the platforms of the World Economic Forum. Together, they have demonstrated significant progress on how we approach environmental sustainability and consumption, health and education, rural development and job training, and finding new ways to advance human rights and equality in different contexts around the world. However, poverty, inequality and climate change are too large and complex for any single social entrepreneur or institution to tackle alone. It should be recognized that many of these issues are interconnected. \The underlying causes also run deep in history, politics and culture, and our best solutions are often constrained by outdated rules and skewed power structures. We are seeing that, in order to create real change, dynamic interactions and multi-stakeholder partnerships across ideological divides are critical to making the radical changes that we know we need. We need social innovation diffused within every sector so we can adopt, adapt, diffuse and scale what this societal R&D has shown to be possible and sustainable – whether it be self-sustaining eco-businesses in the desert, or community-based, tech-enabled healthcare. Those driving the social innovation ecosystem require imagination, compromise, resilience and, above all, committed, courageous innovative people. Therefore, the Schwab Foundation has expanded its remit to recognise and support an ecosystem of pioneering actors who share a common purpose: to accelerate our progress towards the Sustainable […]

Why today's protests are not revolutionary TM website

Why aren’t today’s protests leading to revolutions?

-Peter McPhee, Emeritus professor, University of Melbourne We live in a world of violent challenges to the status quo, from Chile and Iraq to Hong Kong, Catalonia and the Extinction Rebellion. These protests are usually presented in the media simply as expressions of rage at “the system” and are eminently suitable for TV news coverage, where they flash across our screens in 15-second splashes of colour, smoke and sometimes blood. These are huge rebellions. In Chile, for example, an estimated one million people demonstrated last month. By the next day, 19 people had died, nearly 2,500 had been injured and more than 2,800 arrested. How might we make sense of these upheavals? Are they revolutionary or just a series of spectacular eruptions of anger? And are they doomed to fail? Key characteristics of a revolution As an historian of the French Revolution of 1789-99, I often ponder the similarities between the five great revolutions of the modern world – the English Revolution (1649), American Revolution (1776), French Revolution (1789), Russian Revolution (1917) and Chinese Revolution (1949). A key question today is whether the rebellions we are currently witnessing are also revolutionary. A model of revolution drawn from the five great revolutions can tell us much about why they occur and take particular trajectories. The key characteristics are: long-term causes and the popularity of a socio-political ideology at odds with the regime in power short-term triggers of widespread protest moments of violent confrontation the power-holders are unable to contain as sections of the armed forces defect to rebels the consolidation of a broad and victorious alliance against the existing regime a subsequent fracturing of the revolutionary alliance as competing factions vie for power the re-establishment of a new order when a revolutionary leader succeeds in consolidating power. Why today’s protests are not revolutionary […]

Iran vows revenge for Soleimani’s killing

Shahram AkbarzadehProfessor of Middle East & Central Asian Politics, Deputy Director (International), Alfred Deakin Research Institute for Citizenship and Globalisation, Deakin University US President Donald Trump has not held back on threatening Iran after the targeted killing of General Qassem Soleimani, a veteran of the Iran-Iraq war in the 1980s and a key player in expanding Iran’s links with armed groups across Iraq, Syria and Lebanon. In addition to extreme sanctions, Trump’s latest threat includes hitting 52 military and cultural targets in Iran. As might be expected, the Iranian leadership has doubled down on its anti-US rhetoric and promises of retribution. Soleimani was too important to the regime to let this slide. As the commander of the Quds Force in the Islamic Revolutionary Guards Corps (IRGC), Soleimani was in direct contact with Hezbollah in Lebanon. He mobilised the militant group to defend Syrian leader Bashar al-Assad against US-backed rebels and armed Islamist groups. Soleimani also visited Moscow in 2016 to make a case for, and coordinate, Russia’s military involvement in Syria. Soleimani made frequent trips to Iraq to bolster the Kurdish and later the Shia militia push-backs against the Islamic State. The recapture of Mosul from the Islamic State in 2016 by the US-backed Iraqi army and the Shia Popular Mobilization Units (PMU) was greeted in Iran with joy. Soleimani was celebrated as a national hero. The Iranian regime praised him for serving the national security doctrine of offensive defence: defeating ISIS beyond Iran’s borders. Direct military confrontation is unlikely It makes sense, then, that the Iranian regime feels compelled to respond to Soleimani’s assassination. Iran cannot afford to let its national hero be slain without retribution. When Soleimani’s daughter asked President Hassan Rouhani, “Who will avenge my father’s blood?”, his response was swift: “We will all take revenge”. But what can Iran do? The […]

As Turkish troops move in to Syria, the risks are great – including for Turkey itself

Turkey did not waste much time in launching an attack on Syrian soil just days after US President Donald Trump announced he would withdraw US forces from northern Syria. As this development opens a new chapter in Syria, Turkey maybe unwittingly sinking deeper into that country’s civil war. This is not the first time president Trump has mentioned withdrawal from Syria – he voiced it in April 2018. Alleged gas attacks by the Syrian President Bashar al-Assad’s incumbent government followed, which resulted in the US continuing its stay in Syria despite its reluctant president. The US government has always been tentative with its Syrian policy, which was openly exploited by Russia in its bid to support the Assad government’s grip on power in the embattled country. It is also not the first time Turkey has talked about a military presence in Syria. In January 2018, it sent troops to north-western Syria, establishing its control over lands to the west of the Euphrates river. Turkey has increased its military build up on the Syrian border ever since. The US contained any further Turkish advances by making it clear Turkey was not welcome to the east of the river, especially when the US needed the support of Kurdish forces in ending Islamic States’s presence in Syria. Why does Turkey want to increase its military presence in Syria? There are three main reasons Turkish President Recep Tayyip Erdogan is eager to send more troops in to northern Syria east of the Euphrates river. The first is the prospect of free Kurdish states near its borders inspiring the sizeable Kurdish populations in the south east of Turkey to seek similar aspirations. Northern Iraq is slowly moving towards independence. If Kurds in northern Syria were to establish an autonomous region, it would only be a matter of time before the same demands were raised in Turkey. […]

Blowout: Big Oil and Gas Versus Democracy—Winner Take All

by Rachel Maddow Rachel Maddow’s Blowout offers a dark, serpentine, riveting tour of the unimaginably lucrative and corrupt oil-and-gas industry. With her trademark black humour, Maddow takes us on a switchback journey around the globe—from Oklahoma City to Siberia to Equatorial Guinea—exposing the greed and incompetence of Big Oil and Gas. She shows how Russia’s rich reserves of crude have, paradoxically, stunted its growth, forcing Putin to maintain his power by spreading Russia’s rot into its rivals, its neighbors, the United States, and the West’s most important alliances. Chevron, BP, and a host of other industry players get their star turn, but ExxonMobil and the deceptively well-behaved Rex Tillerson emerge as two of the past century’s most consequential corporate villains. The oil-and-gas industry has weakened democracies in developed and developing countries, fouled oceans and rivers, and propped up authoritarian thieves and killers. But being outraged at it is, according to Maddow, “like being indignant when a lion takes down and eats a gazelle. You can’t really blame the lion. It’s in her nature.” This book is a clarion call to contain the lion: to stop subsidising the wealthiest industry on earth, to fight for transparency, and to check the influence of predatory oil executives and their enablers. The stakes have never been higher. As Maddow writes, “Democracy either wins this one or disappears.”

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