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by afew (afew(a in a circle)eurotrib_dot_com) on Wed Mar 28th, 2012 at 10:53:30 AM EST
Democratic inequality | European Voice

This is one of the first detailed studies of the adverse effects of income inequality that I have seen. It goes beyond the headline-grabbing `1%' debate to show that even the everyday inequality that most Americans face has deep, pernicious effects.

Equally interesting is the link that the study finds between income inequality and pre-crisis economic policy. Republican Congressmen from districts with higher levels of income inequality were more likely to vote for legislation to expand housing credit to the poor in the years before the crisis (almost all Democrats voted for such legislation, making it hard to distinguish their motives). And the effect of spending by the rich on non-rich households' spending was higher in areas where house prices could move more, suggesting that housing credit and the ability to borrow against rising home equity may have supported over-consumption by the non-rich.

I was most fascinated, though, by the difference in legislators' response to inequality now and in the past. In a study of the congressional vote on the McFadden Act of 1927, which sought to boost competition in lending, Rodney Ramcharan of the US Federal Reserve and I found that legislators from districts with a highly unequal distribution of land holdings - farming was the primary source of income in many districts then - tended to vote against the act. More inequality led legislators, at least in that case, to prefer less competition and less expansion in lending. And we found that counties with less bank competition experienced a milder farmland boom, and therefore a smaller bust in the years before the Great Depression.

by afew (afew(a in a circle)eurotrib_dot_com) on Wed Mar 28th, 2012 at 02:13:33 PM EST
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BRICS summit to explore creation of bank - Central & South Asia - Al Jazeera English

The proposal of a development bank is high on the agenda at the summit of the five BRICS bloc nations - Brazil, Russia, India, China and South Africa - starting on Thursday in New Delhi.

The proposal for a "South-South" development bank in the mould of the World Bank is one of the main points to be discussed by the group of five rising powers at the fourth BRICS summit.

The initiative would allow the countries to pool resources for infrastructure improvements, and could also be used in the longer term as a vehicle for lending during global financial crises such as the one in Europe, officials said.

"What will be discussed (in New Delhi) is the possibility of setting up a BRICS development bank for infrastructure projects, development, not only in member countries but also in developing countries," Maria Edileuza Fonteneles Reis, a senior Brazilian foreign ministry official, said.

Fernando Pimentel, the Brazilian industry and trade minister, told reporters in Brasilia last week, "the proposal to set up a BRICS bank, an international, investment bank of these five countries," is the main item on the agenda.

He said that the countries would sign a deal at the summit to study the creation of the bank.

by afew (afew(a in a circle)eurotrib_dot_com) on Wed Mar 28th, 2012 at 02:32:46 PM EST
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True economic measure includes natural assets: scientists | Reuters

(Reuters) - Traditional measures showing strong economic growth in Brazil and India over nearly two decades fail to take account of the depletion of their natural resources, scientists and economists at a climate conference said on Wednesday.

Scientists and environment groups have been pressuring governments to include the value of their countries' natural resources - and use or loss of them - into future measurements of economic activity, rather than relying solely on the gross domestic product calculation.

Between 1990 and 2008, the wealth of Brazil and India measured by GDP rose 34 percent and 120 percent respectively, but this measurement is flawed, economists at the "Planet Under Pressure" conference in London argued.

by afew (afew(a in a circle)eurotrib_dot_com) on Wed Mar 28th, 2012 at 02:50:29 PM EST
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We keep coming back to externalities. They are very prominent in energy, but even greater within the system itself.

so there's two games, one to get externalities included, and the harder one, how to quantify them.

"Life shrinks or expands in proportion to one's courage." - Ana´s Nin

by Crazy Horse on Wed Mar 28th, 2012 at 05:53:21 PM EST
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yes, it is the 800lb gorilla.

how do you 'quantify' the amazon basin, all they know is how to commodify it, and not even that really, because what market values can they ascribe when the market itself is so fickle and skewed by speculation?

when externalities are included, all of a sudden you get why the whole is more than merely the sum of its parts, the difference between seed corn and eating corn, between the goose and its eggs, between furniture and firewood...

and why humpty dumpty is so hard to put together again.

they don't talk about 'internalities', do they?

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Wed Mar 28th, 2012 at 08:35:58 PM EST
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Apologize for not getting english links, but methinks it funny that the German states are calling for Germany Bonds so everyone pays the same interest rates.

Yes, Frau Merkel, they wish a Transfer Union.

Süddeutsche Zeitung

"Life shrinks or expands in proportion to one's courage." - Ana´s Nin

by Crazy Horse on Thu Mar 29th, 2012 at 06:01:10 AM EST
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