Wednesday, December 02, 2015

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- Paul Krugman reviews Robert Reich's upcoming book, with a particular focus on the connection between corporate power and growing inequality:
...Reich makes a very good case that widening inequality largely reflects political decisions that could have gone in very different directions. The rise in market power reflects a turn away from antitrust laws that looks less and less justified by outcomes, and in some cases the rise in market power is the result of the raw exercise of political clout to prevent policies that would limit monopolies—for example, the sustained and successful campaign to prevent public provision of Internet access.

Similarly, when we look at the extraordinary incomes accruing to a few people in the financial sector, we need to realize that there are real questions about whether those incomes are “earned.” As Reich argues, there’s good reason to believe that high profits at some financial firms largely reflect insider trading that we’ve made a political decision not to regulate effectively. And we also need to realize that the growth of finance reflected political decisions that deregulated banking and failed to regulate newer financial activities.

Meanwhile, forms of market power that benefit large numbers of workers as opposed to small numbers of plutocrats have declined, again thanks in large part to political decisions. We tend to think of the drastic decline in unions as an inevitable consequence of technological change and globalization, but one need look no further than Canada to see that this isn’t true. Once upon a time, around a third of workers in both the US and Canada were union members; today, US unionization is down to 11 percent, while it’s still 27 percent north of the border. The difference was politics: US policy turned hostile toward unions in the 1980s, while Canadian policy didn’t follow suit. And the decline in unions seems to have major impacts beyond the direct effect on members’ wages: researchers at the International Monetary Fund have found a close association between falling unionization and a rising share of income going to the top one percent, suggesting that a strong union movement helps limit the forces causing high concentration of income at the top.

Following his schema, Reich argues that unions aren’t so much a source of market power as an example of “countervailing power” (a term he borrows from John Kenneth Galbraith) that limits the depredations of monopolists and others. If unions are not subject to restrictions, they may do so by collective bargaining not only for wages but for working conditions. In any case, the causes and consequences of union decline, like the causes and consequences of rising monopoly power, are a very good illustration of the role of politics in increasing inequality.
- Takashi Nakamichi reports that the Bank of Japan is going so far as to push unions to demand higher wages for the good of that country's economy as a whole. And Chico Harlan writes about the publicly-subsidized spread of low-wage work through the southern U.S. (and the limited opportunities it creates for workers), while Sara Mojtehedzadeh highlights the exploitation of cleaning workers through subcontracting arrangements in Ontario.

- Courtney Howard points out an open letter to the Trudeau Libs from Canadian physicians about the importance of the Paris climate conference and action against climate change. And that appeal would seem to fit with the Libs' talk about recognizing the social determinants of health as an element of their policy-making process.

- But of course, it remains to be seen whether they'll live up to that promise - and their installation of an oil executive in a prominent natural resources position doesn't exactly bode well.

- Finally, Andrew Mitrovica rightly slams any attempt to blame terrorism on people who value civil liberties. And Robert Benzie and Robert Cribb report on Ontario's long-overdue - and unanimous - push to limit how information in the hands of police can be misused for other purposes.

No comments:

Post a Comment