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Bolivia

Ecuador

Latin America and the Caribbean

World

ALBA Members Take the Lead in Crafting Alternatives in Arbitrating Investor-State Disputes

In an article this week in the Malaysian Star, South Centre Director Martin Khor describes a move by Latin American and Caribbean countries – most of which belong to the Bolivarian Alliance for the Americas group, or ALBA –  to form an alternative to the World Bank’s International Center for Settlement of Investment Disputes (ICSID) to settle investor-state disputes, noting the predilection of ICSID to rule in favor of corporations:

LEADERS of several Latin American countries have set up a new coalition to coordinate actions to face the growing number of international legal suits being taken against governments by transnational companies.

A ministerial meeting of 12 countries held in Guayaquil, Ecuador, decided on several joint actions to counter the threat posed by these lawsuits, which have claimed millions or even billions of dollars from governments.

…

Seven of the countries, mostly represented by their ministers of foreign affairs, trade or finance, adopted a declaration with an agreement to form a conference of states affected by transnational interests.

They are Ecuador, Bolivia, Cuba, Nicaragua, Dominican Republic, St Vincent and the Grenadines as well as Venezuela.

But while these are all ALBA members (except the Dominican Republic), Khor notes that several other countries were also present at the meeting are not: “Representatives of another five countries (Argentina, Guatemala, El Salvador, Honduras and Mexico) also attended the meeting and will convey the results to their respective governments.”

Dan Beeton / May 03, 2013

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Workers

The Politics of Good Jobs

This post originally appeared in Dissent Magazine. Colin Gordon is a professor and director of Undergraduate Studies, 20th Century U.S. History, at the University of Iowa.

What happened to the good jobs? This is the question posed by the walkouts of fast food workers in New York and Chicago in recent weeks. It is the question posed by activists in those corners of the economy—including restaurants and domestic work and guestwork—where the light of state and federal labor standards barely penetrates. And it is the question posed (albeit from a different set of expectations), by recent college graduates for whom low wages and dim prospects are the dreary norm.

There are no shortage of suspects for this sorry state of affairs. The stark decline of labor, now reaching less than 7 percent of the private sector, has dramatically undermined the bargaining power and real wages of workers. The erosion of the minimum wage, for which meager increases have been overmatched by inflationary losses, has left the labor market without a stable floor. And an increasingly expansive financial sector has displaced real wages and salaries with speculatory rent-seeking.

New work by John Schmitt and Janelle Jones at the Center for Economic and Policy Research recasts this question, posing it not as a causal riddle but as a political challenge: What would it take to get good jobs back?

Schmitt and Jones start with a basic distinction between good jobs (those that pay $19.00/hr or better and offer both job-based health coverage and some retirement coverage) and bad jobs (those that meet none of these criteria). Each of these categories accounts for about a quarter of the workforce (the rest fall somewhere in between), with the share of good jobs slipping since 1979 and the share of bad jobs creeping up. The goal, by simulating the impact of different policy interventions, is to increase the share of good jobs and to eliminate—as much as possible—the bad jobs entirely.

CEPR and Colin Gordon / May 02, 2013

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Honduras

Latin America and the Caribbean

World

Senator Menendez Meets with President Lobo to Discuss U.S. Funding for Honduras

Senate Foreign Relations Committee Chairman Robert Menendez (D-NJ) met with Honduran president Porfirio “Pepe” Lobo on Wednesday as part of a tour through Central America. According to press reports, Menendez characterized the trip, during which the Senator also visited El Salvador and Guatemala, as an opportunity to evaluate regional counter-narcotics and security initiatives that the U.S. is funding at increasing levels through the Central American Regional Security Initiative (CARSI). A Spanish-language press report on the trip quotes Menendez as having said that he intends to “explore the specific points of this funding proposal,” and that he wants to “see what works and what does not.”

The State Department’s 2014 budget proposal, submitted on April 10, requests $161.5 million in funding for CARSI, a $26 million increase from the previous year. The proposal requests $4.5 million in foreign military financing specifically for Honduras, an increase of 450% over the FY2012 total. And Just the Facts, a joint project of nonpartisan groups focused on U.S.-Latin American relations, notes that current budget proposals have total U.S. military and police funding for Honduras in FY2014 at $8.7 million, a 63% increase over 2013 projections. Furthermore, according to a Congressional Research Service report, as of last July the State Department and USAID had planned to allocate a combined $72 million to Honduras in FY2012.

These rising levels of funding for the police and military run counter to the concerns of many lawmakers in Washington around the lack of accountability for U.S. involvement in Honduran security and anti-narcotics operations. It also highlights the seriousness of recent reports that the State Department has been supporting units under the command of National Police Chief Juan Carlos “El Tigre” Bonilla, who allegedly ran death-squads a decade ago, and, more broadly, that the police have been accused of continuing to commit death-squad murders today. In December the National Autonomous University, citing the police’s own reports, announced that police had killed 149 civilians in the previous two years.

CEPR and Arthur Phillips / May 02, 2013

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Congresswoman Lee Re-Introduces Bill to “Assess Progress” of U.S. Haiti Assistance

On April 25th, Representative Barbara Lee of California introduced H.R. 1749, the Assessing Progress in Haiti Act, which would require the Government Accountability Office (GAO) to produce a detailed and comprehensive report on U.S. aid programs to Haiti since the January 2010 earthquake.  The bill, which has 24 original co-sponsors, reflects the growing concern in Congress about the lack of tangible progress in U.S. post-quake relief and reconstruction efforts, and the lack of transparency around how U.S. aid money is being used.

An earlier version of this bill was passed in the House of Representatives in May of 2011 and later was approved by the Senate Foreign Relations Committee, but never made it to a vote on the Senate floor.  The legislation has been significantly revised and, whereas the old bill (which can be viewed here) had general reporting requirements, the new bill (which can be viewed here) has very specific and probing reporting language that should help shed light on how USAID funds are being used on the ground in Haiti.  Among other things, the legislation calls for:

·         An assessment of the “amounts obligated and expended on United States Government programs and activities since January 2010 (…) including award data [read: financial data] on the use of implementing partners at both prime and subprime levels, and disbursement data from prime and subprime implementing partners.”

·         A description of “goals and quantitative and qualitative indicators to evaluate the progress, or lack of achievement of such goals…”

·         An “assessment of the manner in which the Department of State and USAID are working with Haitian ministries and local authorities, including the extent to which the Government of Haiti has been consulted on the establishment of goals and timeframes and on the design and implementation of new programs…”

·         An “assessment of how consideration for vulnerable populations, including IDPs (Internally Displaced Populations), women, children, orphans, and persons with disabilities, have been incorporated in the design and implementation of new programs and infrastructure”

·         An “assessment of how agriculture and infrastructure programs are impacting food security and the livelihoods of smallholder farmers in Haiti”

Last month CEPR published a report titled “Breaking Open the Black Box” describing the lack of transparency of U.S. aid programs in Haiti, particularly at the contracting level, and recommended USAID reporting requirements similar to those found in H.R.1749.  The report noted that the effectiveness of U.S. aid to Haiti has been questioned by the GAO, the USAID Inspector General and other government watchdogs. 

Jake Johnston / May 01, 2013

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Bolivia

Latin America and the Caribbean

World

Bolivia Expels USAID: Not Why, but Why Not Sooner

At a speech celebrating May Day in Bolivia today, President Evo Morales announced the expulsion of the United States Agency for International Development (USAID) from the country. According to the AP, Morales stated:

"The United States does not lack institutions that continue to conspire, and that's why I am using this gathering to announce that we have decided to expel USAID from Bolivia.”

The role of USAID in Bolivia has been a primary point of contention between the U.S. and Bolivia dating back to at least 2006. State Department spokesperson Patrick Ventrell characterized Morales’ statement as “baseless allegations.” While State Department spokespeople and many commentators will characterize USAID's work with oppositional groups as appropriate, a look at the agency's work over the past decade paints a very different picture.

Documents obtained by investigative journalist Jeremy Bigwood show that as early as 2002, USAID funded a “Political Party Reform Project,” which sought to “serve as a counterweight to the radical MAS [Morales’ political party] or its successors.” Later USAID began a program “to provide support to fledgling regional governments,” some of which were pushing for regional autonomy and were involved in the September 2008 destabilization campaign that left some 20 indigenous Bolivians dead. Meanwhile, the U.S. has continually refused to disclose the recipients of aid funds. As a recent CEPR report on USAID activities in Haiti concluded, U.S. aid often goes into a “black box” where it becomes impossible to determine who the ultimate recipients actually are.

Jake Johnston / May 01, 2013

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Thomas Friedman's 401(k) Agenda

Thomas Friedman is probably best ignored, but there are people who take him seriously. Today his NYT column touts the "401(k) world" where Friedman says:

"But this huge expansion in an individual’s ability to do all these things comes with one big difference: more now rests on you."

The gist of the argument is that people are more exposed to risk so that means that they can fall farther or, in principle, rise higher than before all the wonderful new technologies that leave Friedman breathless.

Naturally, just about everything Friedman has to say is wrong or misleading. First and foremost, wonderful new technologies are not new. We have been seeing breakthroughs in technology for the last two hundred years. Have the last decade's been more wonderful and awesome than the breakthroughs of prior decades?

How does the Internet compare to development of the telegraph, the telephone, radio, television?  I have a job, so I'll let the Thomas Friedmans of the world worry about that one.

Dean Baker / May 01, 2013

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Does Capriles Have a Plausible Claim, or is He “Venezuela’s Sore Loser”?

Reuters reported Sunday that the president of Venezuela’s National Electoral Council (CNE) Tibisay Lucena has criticized opposition candidate Henrique Capriles for not presenting proof to back up his claims of fraud (also the focus of our post earlier today):

"We have always insisted that Capriles had the right to challenge the process," Tibisay Lucena, president of the electoral council, said in a televised national broadcast.

"But it is also his obligation to present proof."

She dismissed various opposition submissions alleging voting irregularities as lacking key details, and said Capriles had subsequently tried to present the audit in very different terms than the electoral council had agreed to.

"It has been manipulated to generate false expectations about the process, including making it look like the consequence of the wider audit could affect the election results," she said.

Lucena's statements that the election audit of the remaining voting machines, as initially called for by Capriles, will not change the results are correct, although perhaps not for the reasons she meant. As noted on Friday, we did a statistical analysis of the probability of the results of the audit of the first 53 percent of voting machines finding the results it did if the remaining 46 percent of voting machines in Venezuela had enough discrepancies to change the results of the election. The probability, according to our calculations, is less than 1 in 25,000 trillion.

The math is pretty straightforward. Considering how many votes by which Nicolás Maduro was declared the winner, and that the initial audit of 54 percent of machines didn't find anything, and considering how many votes there are per machine, it is almost impossible for the remaining 46 percent of machines to have enough discrepancies to change the election results.

CEPR / April 30, 2013