How Global Inequality Undermines Global Democracy

Yet another massive leak of offshore banking documents has revealed the remarkable extent of the world’s “parallel economy”, in which a large and growing proportion of global wealth is secretly stashed away in a complex and opaque network of tax havens.

In addition to the obvious diversion of literally trillions of dollars of capital that could be better spent alleviating the needless suffering of billions (with plenty left over to spare), this development is arguably a threat to democratic governance the world over, as Matt Phillips at Vice argues. Continue reading

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Iran Tests Most Generous Basic Income Plan Yet

Iran hardly comes to mind when it comes to testing bold new ideas (never mind its various scientific and technological achievements in the face of sanctions and a reactionary theocracy). But since 2011, it has been testing and monitoring one of the most generous basic income schemes in the world, joining the likes of Canada, Finland, and the Netherlands (among others) in exploring the merits of an idea that has been gaining traction amid concerns about mass unemployment from advancing automation.

The program, which is ongoing, was launched during the tenure of President Mahmoud Ahmadinejad, himself hardly a progressive (to put it mildly). But it was ideal timing, as it followed cuts to subsidies for bread and fuel, which disproportionately impacted the poor. Participants received a monthly cash transfer equivalent to 29 percent of the country’s median household income — which would amount to over $16,300 a month in the U.S.! This is far more generous than the $1,000 or so monthly stipend that is typical in most basic income schemes. Even advocates of the idea might think it is far too much to sustain a productive population.

Yet, as BusinessInsider reported, not only did researchers find that most recipients remained employed, but many of them worked more hours.

Despite reports in local press that the poor were forgoing their jobs to spend the extra money, the investigators found no such evidence.

“Our results do not indicate a negative labor supply effect for either hours worked or the probability of participation in market work, either for all workers or those in the bottom 40% of the income distribution,” they wrote.

They did find people in their twenties tended to work a bit less. But “this is not surprising since the attachment of Iranian youth to the labor market is weak,” they wrote, and many young people may have used the money to enroll in higher education they otherwise couldn’t afford.

In other cases, the extra money appeared to increase how much time people spent working. Service workers, such as housekeepers, teachers, and deliverymen, upped their weekly hours by roughly 36 minutes, “perhaps because some used transfers to expand their business.”

In other words, people were empowered to invest the money they received in ways that created greater values for themselves and, by extension, their loved ones and community. This comports with the results of the basic income experiments conducted in Canada and Namibia, as well as Brazil’s Bolsa Familia program, which is one of the few examples of a full-fledged cash-transfer scheme (although not quite a basic income, since it is conditional on children attending school and being vaccinated).

Unfortunately, Iran’s experiment also proved another common feature of the basic income idea: widespread negative attention and cynicism, in this case by both politicians and the general public. Across different societies and cultures, the idea of handing people money with no string attached strikes a visceral chord.

But given where automation and economic innovation are heading, it seems inevitable that mass unemployment — and the massive wealth imbalance that would follow — will need to be corrected. Not only would a guaranteed income provide for people’s basic needs, but as these pilot programs are thus far proving, they would empower individuals with the resources they need to unlock their own potential, whether it is freeing up time for socially valuable work (caregiving, volunteering, etc.) or investing in their own creative or commercial ventures.

What are your thoughts?

 

The Problem With Lotteries

Like most Americans, I never gave much thought to lotteries. They were just an amusing, unlikely way to get rich at the cost of a only few bucks and some minutes filling out tickets.

But as The Atlantic’s Derek Thompson points out, lotteries are big business in the U.S., and can very well be considered an industry in their own right. Consider the following chart based on data from the North American Association of State and Provincial Lotteries (they’ve got an organization for everything these days). As of 2014, Americans nationwide spent more on lotteries than on all other forms of entertainment combined. Continue reading

Why a Basic Income Won’t Lead to Mass Idleness — And Why Less Work Might Not Be Such a Bad Thing Anyway

Work has historically been seen as having a stabilizing effect on both individual’s life and society as a whole. Too much idleness means lots of important things aren’t getting done; widespread boredom and laziness will settle in, causing people becoming self-indulgent, hedonistic, or even immoral. It is little wonder that most people cannot conceive of any other order to our society or economy — what would a world with less work look like? Won’t giving everyone money only guarantee mass departure from the workforce?

Joel Dodge of Quartz takes to task this common counterargument to the universal basic income (UBI), pointing to research showing no ill effects on work ethic and societal productivity: Continue reading

Distrust of Big Business at All-Time High

The post recession world has, understandably, been a deeply cynical place, and a major indicator of this is the historically high level of distrust of corporations, if not the U.S. economy in general. As The Economist reported:

The share of Americans who hold “very” or “mostly” favourable opinions of corporations has fallen from 73% in 1999 to 40% today, according to the Pew Research Centre. Surveys by Gallup of views on big business show less extreme swings, but point in the same direction (see chart). Over 70% of America’s population believes that the economy is rigged in favour of vested interests.

Such growing hostility to business is in evidence across the rich world. Britain’s decision in June to leave the European Union was driven in part by popular discontent with big business, which had lobbied heavily to remain. Many continental Europeans are becoming ever more vocal in expressing their long-standing doubts about “Anglo-Saxon capitalism”.

This backlash against big business is already having an impact on policymakers. The antitrust division of America’s Department of Justice says that under President Obama it has won 39 victories in merger cases—deals blocked by courts or abandoned in the face of government opposition—compared with 16 under George W. Bush. Those victories included a string of blockbuster deals such as Comcast’s proposed bid for Time Warner Cable and Halliburton’s planned takeover of Baker Hughes. The European Union has launched a succession of tough measures against Silicon Valley’s tech giants, such as asking Apple to stump up billions of euros in allegedly underpaid taxes in Europe, and allowing European news publishers to charge international platforms such as Google that show snippets of their stories. Britain’s new prime minister, Theresa May, has said that she may cap CEO pay and put workers on boards. Governments worldwide have started co-operating to curb the use of tax havens.

Continue reading

An Optimistic World

As I have pointed out in previous blog posts (see here and here), the world is becoming an increasingly better place to live, with many of the poorest nations experiencing the most dramatic improvement. From increasing incomes to lengthening life expectancies, hundreds of millions of people across the world are climbing out of poverty, malnutrition, and insecurity and enjoying lives of unprecedented prosperity.

Little wonder then that various surveys conducted by the Pew Research Center show that most developing-world citizens are optimistic about their futures and those of their children — although tellingly, the same cannot be said about their counterparts in wealthier parts of the world.

inequality-13 Continue reading

The Problem With How We Treat Drug Addicts

The United States is facing an opioid and heroin epidemic that is killing and harming record numbers of people; more people died of overdoses in 2014 than in any other year on record.

One of the latest and most troubling images of this problem was a widely circulated photo of a couple passed out in their car with their four year old left watching from the back city. The City of East Liverpool, Ohio saw fit to share the photo on its Facebook profile to “show the other side of this horrible drug”. Continue reading

Map: Lynchings in the Southern U.S. (1877-1950)

One of the most insidious and terrorizing elements of racism and white supremacy in the United States was lynching, broadly defined as an extrajudicial public execution carried out by a mob against an alleged criminal or transgressor. In most cases, the intention was not simply to mete out supposed justice in place of a court of law — not that the legal system in much of the South was any fairer or more impartial — but to enforce social control against particular groups, especially African Americans.

Montgomery, Alabama, which was the center of some of the worst racist atrocities and policies, will soon host one of the nation’s first and largest memorials to lynching, immortalizing the thousands of victims of racially motivated lynchings. (Appropriately, it will sit on the highest spot in the city, which was once the first capital of the Confederacy.)

The organization behind this effort, Equal Justice Initiative, has also put together a map of all the racial lynchings that took place across a  73-year period spanning the end of the post-Civil War Reconstruction Era to the beginning of the Civil Rights movement.  Continue reading

The Globalization of Plutocracy

According to a 2015 paper by American political scientist Larry Bartels of Vanderbilt University, the gap between the rich and poor — and the subsequent unresponsiveness of government to the needs of the majority — is not just a feature of United States, as a multitude of studies have revealed. The struggle between the haves and have nots seems inextricably tied to our species, varying only be degree.

For example, in almost every nation Bartels studied, the wealthy were generally and categorically opposed to social spending, even during bad economic times. Continue reading

The Safest Cities in the World

According to 2015 Safe Cities Index compiled by the Economist Intelligence Unit (EIU), Tokyo, Japan is the world’s safest city, scoring high in all factors, from low crime to pedestrian-safe urban planning.

According to The Guardian:

The EIU looked at a wide range of factors when putting together the index. It examined digital security, and considered the number of cyber attacks and how they were tackled. It looked at the obvious area of personal safety, but also infrastructure security – sanitation, roads, and management of natural disasters. In the health security category, it looked at quality of healthcare (for instance, how many hospital beds and doctors there were per 1,000 people), but also at issues such as pollution. As the report puts it, “Living in a safe and healthy urban environment can make a real and measurable difference to city inhabitants”. In the index’s top 25 cities, average life expectancy is 81; in the bottom half, it is 75.

As the article cautions, however, a sense of safety is highly variable depending on one’s lifestyle and priorities.

Before you start packing your bags, however, the conclusions aren’t simple: Tokyo also happens to be considered the world’s riskiest city, in part because of the huge number of people who would be harmed in an inevitable future earthquake. Nor does the report actually say which city is safest for you. From an individual’s point of view, as opposed to the municipal officials responsible for the smooth running of a city, isn’t personal safety more important than the threat of cyber crime? In that case, maybe you should look at Singapore instead. And what if health security is your priority, but you’ll take your chances on the streets? Move to Zurich: first for health, 13th for personal safety.

Other studies have revealed other issues that might be of personal importance. Amsterdam, for instance, is – perhaps unsurprisingly – a good place to be a on a bike. In 2011 and 2013, the Dutch city was ranked safest for cyclists by urban planning consultancy the Copenhagenize Design Company, using criteria such as bicycle facilities, drivers’ attitudes, and political will to promote cycling. The sheer proliferation of cyclists helps – cycling in the city, notes the report, is “about as mainstream as you can get” – as does cycling infrastructure and a 30kph speed limit.

Here are the safest cities by region:

safe_cities_index_world-map-2

Here is a detailed breakdown by the EIU:

  •  Tokyo tops the overall ranking. The world’s most populous city is also the safest in the Index. The Japanese capital performs most strongly in the digital security category, three points ahead of Singapore in second place. Meanwhile, Jakarta is at the bottom of the list of 50 cities in the Index. The Indonesian capital only rises out of the bottom five places in the health security category (44).
  • Safety is closely linked to wealth and economic development. Unsurprisingly, a division emerges in the Index between cities in developed markets, which tend to fall into the top half of the overall list, and cities in developing markets, which appear in the bottom half.  Significant gaps in safety exist along these lines within regions. Rich Asian cities (Tokyo, Singapore and Osaka) occupy the top three positions in the Index, while poorer neighbours (Ho Chi Minh City and Jakarta) fill two of the bottom three positions.

  • However, wealth and ample resources are no guarantee of urban safety. Four of the five Middle Eastern cities in the Index are considered high-income, but only one makes it into the top half of the Index: at 25 Abu Dhabi is 21 places above Riyadh at number 46. Similar divides between cities of comparable economic status exist elsewhere.  Seoul is 23 positions below Tokyo in the overall ranking (and 46 places separate the two on digital security).

  • U.S. cities perform most strongly in the digital security category, while Europe struggles. New York is the only U.S. city to make it into the top ten of the overall index (at 10). However, it is third for digital security, with three of the four other US cities in the Index (Los Angeles, San Francisco and Chicago) joining it in the top ten. Meanwhile, European cities perform relatively poorly.  London, at 16, is the highest-ranking European entry in the digital security index; Rome is the lowest, at 35.

  • Leaders in digital security must not overlook real-world risks. Los Angeles falls from 6th place in digital security to 23rd for personal safety. San Francisco suffers a similar drop, falling from 8th to 21st.  For these cities—both home to high-tech industries—a focus on technology and cyber security does not seem to be matched by success in combating physical crime. Urban safety initiatives need to straddle the digital and physical realms as the divide between them blurs.

  • Technology is now on the frontline of urban safety, alongside people. Data are being used to tackle crime, monitor infrastructure and limit the spread of disease. As some cities pursue smarter methods of preventing—rather than simply reacting to—these diverse security threats, a lack of data in emerging markets could exacerbate the urban safety divide between rich and poor. Nonetheless, investment in traditional safety methods, such as bolstering police visibility, continues to deliver positive results from Spain to South Africa.
  • Collaboration on safety is critical in a complex urban environment. Now that a growing number of essential systems are interconnected, city experts stress the need to bring together representatives from government, business and the community before threats to safety and security strike. Some cities have appointed an official to co-ordinate this citywide resilience. With the evolution of online threats transcending geographical boundaries, such co-ordination will increasingly be called for between cities.
  • Being statistically safe is not the same as feeling safe. Out of the 50 cities, only Zurich and Mexico City get the same rank in the overall index as they do in the indicator that measures the perception of safety among their citizens. Urban citizens in the U.S., for instance, tend to feel less safe than they should, based on their city’s position in the Index. The challenge for city leaders is to translate progress on safety into changing public perceptions. But cities also aspire to be attractive places to live in. So smart solutions, such as intelligent lighting, should be pursued over ubiquitous cameras or gated communities.

Aside from Tokyo, the next five biggest cities in the world do not fare well in terms of safety.

the-big-five

Granted, some analysts are skeptical of the very idea of ranking cities based on safety. As The Guardian reports:

But is it really possible, or even desirable, to rank cities according to their safety? “We are quite wary of doing that”, says Dr Michele Acuto, principal investigator for UCL’s City Leadership Initiative, which is working with the UN on how to improve urban safety. “Rankings pit cities against each other. If you say London is safer than Manchester, it’s a blunt generalisation. You can say London has a lower crime rate than Manchester – that would be correct – but making judgements on safety is perception-based”.

How do you make a city safer? Nobody wants to live in a police state. “You have to reduce crime, but it’s also things like improving safety of transport. If you make a city more sustainable, with more bike lanes, for instance, you can redesign it so that it’s also safer for pedestrians”. The wealth gap also has an important effect on a city’s safety: “There is no safer-city agenda that can proceed without a social-equality agenda”, says Acuto.

And if there’s one factor you might want to consider as a sign of how safe your city is likely to be in future, look to the immigration rate. Studies in the U.S. have shown that, far from what the anti-immigration lobby would have us believe, a city with more immigrants has lower crime rates. A study by Robert J Sampson, professor of social sciences at Harvard University, found that first-generation immigrants were 45% less likely – and second-generation immigrants 22% less likely – to commit violence than third-generation Americans. As Sampson has summed it up: “If you want to be safe, move to an immigrant city.”

Whatever you think about the results, or indeed about ranking cities by safety in the first place, this research is very insightful in a world where a large and rapidly growing proportion of human life is centered.