Despite politicians who argue that lower state income tax rates (usually in states with already low income tax rates) will spur economic development, the facts demonstrate that economic development generally correlates (though causation is not demonstrated) with higher income tax rates. Read Richard Florida's article about this, with maps, here.
WaPo lists five myths about Margaret Thatcher. It is a older piece, from when The Iron Lady was about to premier. I particularly like what it says about Thatcher's views of economic regulation:
But the deregulation she pursued had nothing to do with the lack of oversight that contributed to the meltdown on Wall Street. Before Thatcher, commissions of civil servants decided, for example, what sorts of cars Britons should drive. That was the kind of regulation she ended. She was a passionate proponent of regulation that makes free markets function properly — otherwise known as the rule of law.
Thatcher supported stringent bank regulation. Consider the 1986 Financial Services Act which, contrary to its reputation, closed loopholes in investor protection laws, boosted the enforcement power of regulators, and applied the same investor protection standards to a broad range of securities and investment activities.
Thatcher stood for thrift, sound money and balanced budgets, powered by private enterprise. The uncontrolled explosion of debt in Western economies that followed her time in power would have appalled her.
In an insightful column, Robert Samuelson, a conservative economist, details how Kennedy's 1963 tax cut set up the culture which brought us the sequester by ending the traditional budgetary practices of the country. He calls it the worst domestic policy decision of the post-World War II era.
Arianna Huffington, writing from Davos, discusses "resilience," the new value necessary for surviving and thriving in the 21st century.
I first heard resilience discussed in an NPR story as a value that some cities were embracing in their architecture and design. No longer is sustainability enough, we have now moved into the era when we must cope with globe climate change and defend ourselves against it.
Huffington takes the value to the broader level of global systems.
I'm curious how it will apply in the smaller systems in which I work, church, non-profits, household, etc.
The cover article of the first digital-only Newsweek is novelist Tom Wolfe writing about Wall Street. His lively satire The Bonfire of the Vanities was such a huge hit in the 1980's and here he writes about the decline of those "Masters of the Universe" as trading has radically transformed. After this essay, I understand things about Wall Street and the financial crash that I had not before understood. And it is written with Wolfe verve and wit, not like some boring financial piece. I highly recommend.
A year or more ago my Stewardship Committee chair requested that we do something on the intersection between faith and work. Our staff recently planned an upcoming worship series with the theme "Make Our Work Worthy" that will focus on vocation and spiritual gifts. For an accompanying study, I read this book, which I had seen well-reviewed in The Christian Century. I will use the book for the study.
The title isn't the best and suggests the book is less meaty than it is. There are good discussions of the church's theological traditions on work and money. The main focus of the book is that people compartmentalize work and faith and that the church (and business) have not helped people to integrate these aspects of their lives.
I most enjoyed the early chapters which explored the differing natures of business and church and some of the church's theological tradition. The noticeable lack was anything about the social teachings of the Roman Catholic Church on work.
The second part of the book wants to move toward coherence. It begins with a chapter on rethinking Christian vocation, drawing on the teaching of Luther and Calvin. I thought this chapter could have been longer and stronger. The next chapter was a good approach at developing a moral theology of work.
The last two chapters weren't very engaging. The penultimate discussed the faith at work movement, which seems to primarily be a phenomenon for conservative evangelicals. I learned things in this chapter, but didn't find it spiritual or theologically interesting. It will prompt some interesting discussions when we read it at church though.
The final chapter was supposed to be about the church's potential in helping to integrate faith and work. Most of what was covered had already been (except for an interesting section on Charles Sheldon). I expected more in this last chapter than what was presented.
The book will be good at generating discussion and raises all the issues that I'd like to raise as we explore this question at First Central.
For the first time, the HRC has indexed municipalities based on LGBT equality criteria. This can be used by businesses and workers in determing what cities promote the economic growth that comes from diversity and equality.
A good essay on Wendell Berry and economics. It fits with my current worship approach to the letter of James. Thanks to Donald for the link. An excerpt:
Quit deifying the present economy, yes, and start defying it too by living into the Great Economy. The Great Economy, Berry has written elsewhere, includes everything, connects everything to everything, comprehends humans but cannot be fully comprehended by humans, has no end, and cannot be violated for long. The metaphor that comes to my mind is one of an electrical system. When we quit deifying the present economy, we go off-grid. But when we submit our little economies to the Great Economy of God’s abundant provision – a choice we make one way or another, dozens of times a day – we’re plugging into the deep magic, so to speak, of loaves and fishes, of daily bread, of discipline and hope, of “do unto others,” of plenty to go around, and of sharing that begets not depletion but fullness.
From our infancy the market itself has worked to make us consumers, primed to buy whatever it is selling regardless of its relevance to human flourishing. True freedom requires that we take part in the market as fully formed agents, with life goals determined not by advertising campaigns but by our own experience of and reflection on the various possibilities of human fulfillment. Such freedom in turn requires a liberating education, one centered not on indoctrination, social conditioning or technical training but on developing persons capable of informed and intelligent commitments to the values that guide their lives.
This is why, especially in our capitalist society, education must not be primarily for training workers or consumers (both tools of capitalism, as Marxists might say). Rather, schools should aim to produce self-determining agents who can see through the blandishments of the market and insist that the market provide what they themselves have decided they need to lead fulfilling lives. Capitalism, with its devotion to profit, is not in itself evil. But it becomes evil when it controls our choices for the sake of profit.
An insightful essay from the Nobel prize winner discussing what has gone wrong and right in Europe. He approaches the topic by discussing three issues -- unity, democracy, and financial policy. He writes that a mistake was proceeding with financial union before political union, but he praises the advances in democracy, understood as far more than voting, but involving public debate and discussion. He faults recent economic decisions for failing to persuade the people and ultimately leading to more disunion. One of the achievements of European economic policy before austerity had been its insistence on social justice as a goal of economic policy.
In the discussion of financial policies, he is very critical of the austerity measures and ultimately ends up arguing against a primarily Keynesian approach and in favour of an approach closer to Adam Smith. I think it would surprise most American conservatives that for Sen Keynes is more of a conservative than Smith. Here are relevant excerpts:
THERE IS A CENTRAL ISSUE of social justice involved here—that of reducing rather than enhancing injustice. The public services are valued for what they actually provide to people, especially to vulnerable people, and this is something for which Europe had fought. Savage cuts in these services undermine what had emerged as a social commitment in Europe at the end of World War II, which led to the birth of the welfare state and the national health services in a period of rapid social change in the continent, setting a great example of public responsibility from which the rest of the world—from East Asia to Latin America—would learn.
Keynes had extremely little to say on what social commitments a state should have—what public expenditure should be for, other than for just strengthening market demand through state intervention.
Keynes showed little concern about economic inequality, and was extraordinarily reticent on the horrors of poverty and deprivation.
If we add to this economic argument the long-term concern in Europe about some form of social justice and the more immediate political worry about the undermining of the European sense of solidarity, we can see what a disaster the recent European financial policies have been. The case for resisting the savage cuts in public services can hardly be ignored. This is not because the commitment to social justice must always be paramount, but surely it must be a serious concern that cannot simply be discarded by bankers and financial leaders. There is, of course, always a need for rational scrutiny and examination of what a country can afford and what it cannot—taking into account all the relevant factors, including the changing age distribution of the population. But this is not the same question as checking what a country can afford with inefficient economic and financial management, with fuzzy thinking on exchange rates and market demands and economic competitiveness.
The guiding principle has to be, rather, what Adam Smith specified with clarity in The Wealth of Nations: how to work for a good functioning of the economy to be able to provide the public services that people agree are needed. Sound political economy, Smith argued, has to have “two distinct objects”: “first, to provide a plentiful revenue or subsistence for the people, or more properly to enable them to provide such a revenue or subsistence for themselves; and secondly, to supply the state or commonwealth with a revenue sufficient for the publick services.” Achieving the latter is just as much the goal of good economics as achieving the former.
Sen's analysis is the most insightful and informative that I've read on this issue. I wish we had more public, intellectual discourse such as this in the United States.