Category: Politics

All posts on what Bismarck called “the art of the possible”

Collier on plunder and romanticism

Plunder and romanticism are so rife precisely because ordinary citizens are insufficiently informed about the opportunities and threats that nature poses to have forced governments into effective regulation. In the task of building an informed citizenry the starting point is an ethics of nature that people in societies with widely different value systems can understand and accept. Neither the romantic variant of environmentalism that sees nature as an end in itself, nor the austere universalism of economic Utilitarianism, can provide such a foundation. The most difficult wars to win are those that must be fought on two fronts. It is more straightforward, psychologically more satisfying and dramatic to have only a single enemy. The romantics among environmentalists and the Utilitarian Platonic Guardians among economists see nature as a single-front war. The romantics regard economic growth as the enemy; the Platonic Guardians regard the values of ordinary citizens as the enemy. But most struggles in development are not like that: sanity lies in the middle rather than at the extremes. Aid provides an example. It is neither a panacea nor a menace.

Collier, Paul. The Plundered Planet: Why We Must – and How We Can – Manage Nature for Global Prosperity. 2010. p. 12 (paperback)

Preliminary response to Canada’s Indian Residential Schools Truth and Reconciliation Commission

Canada was founded upon a grave injustice: the appalling mistreatment of North American indigenous populations by European settlers, including countless acts of physical and cultural violence.

Days ago, the The Truth and Reconciliation Commission of Canada released their final report. One part, on page 20 of the summary, seems especially important:

Together, Canadians must do more than just talk about reconciliation; we must learn how to practise reconciliation in our everyday lives — within ourselves and our families, and in our communities, governments, places of worship, schools, and workplaces.

The argument that we bear no moral responsibility for the choices of our ancestors, and that we have no responsibility for systemic patterns of oppression that still exist, is logically and ethically weak. Similarly, the argument that colonization happened so long ago that no recourse is possible or necessary today ultimately perpetuates structures of injustice.

Conversely, the idea that we can to some extent make a sincere and meaningful effort to atone for past and present failings has great appeal. Having dispossessed sophisticated societies of almost all their land and spent decades treating aboriginal people with either cynical viscousness or inhuman contempt, it’s shocking and wrong that a rich state like Canada tolerates the conditions under which too many indigenous people live. There’s no non-aboriginal Canadian community where the question of whether they get drinkable water depends on whether the municipal, provincial, or territorial government is fond of the local mayor, but many aboriginal communities today function under conditions that would spur immediate attention and action for non-aboriginals.

As the first step toward reconciliation, this has to end. Scholars like Taiaiake Alfred are right to question the basic legal and moral validity of the Canadian state, built as it was upon imperialism and conquest. As Alfred explains in Peace, Power, Righteousness: An Indigenous Manifesto (2008):

All land claims in Canada, including those at issue in the BC treaty process, arise from the mistaken premise that Canada owns the land it is situated on. In fact, where indigenous people have not surrendered ownership, legal title to “Crown” land does not exist — it is a fiction of Canadian (colonial) law. To assert the validity of Crown title to land that the indigenous population has not surrendered by treaty is to accept the racist assumptions of earlier centuries.

Canada’s aboriginal peoples would probably be justified in pointing to centuries of mistreatment and treaty violations as just cause for settlers to be expelled. But, based on my limited knowledge and experience, that’s not what anyone is asking for. Most indigenous Canadians who I have met want the spirit of the treaties honoured: to share the land, and to live in peace and friendship.

I am acutely aware of how unqualified I am to discuss these matters. In my defence, I am working to develop a base of knowledge for my academic work. In addition to Peter Russell’s Recognizing Aboriginal Title: The Mabo Case and Indigenous Resistance to English-Settler Colonialism, I am currently reading Dwight Newman’s The Duty to Consult: New Relationships with Aboriginal Peoples and the Kino-nda-niimi Collective’s impressive and inspiring volume The Winter We Danced: Voices from the Past, the Future, and the Idle No More Movement.

The G7 on getting beyond fossil fuels

Regardless of whether you think the commitment is credible, a position on climate change adopted by the G7 bears consideration:

“At yesterday’s summit in Bavaria, the G7 leading industrial nations agreed to phase out fossil fuels by the end of the century.”

For one thing, it’s questionable when politicians set goals so far off in the future. For another, we need to phase out fossil fuels much more rapidly if we’re to avoid catastrophic climate change. Nonetheless, there’s one important message here: fossil fuels have no long-term future, and that is increasingly being recognized by the world’s most powerful governments.

Hopefully, this will help people come to grips with the implications of the carbon bubble, and make people think more critically about the appropriateness of building long-lived new fossil fuel infrastructure like pipelines.

CPSA conference 2015

There are a lot of interesting panels at this year’s Canadian Political Science Association conference, at the University of Ottawa.

I just finished a free lunch at the book launch for Patriation and its Consequences, alongside Peter Russell and Alan Cairns. This afternoon, I am attending panels on “Comparing Provinces: First Nations, the North and Provinces” and “Federalism and Public Policy” (chaired by Kathryn Harrison). Later, there’s the CPSA president’s address.

I’m starting tomorrow morning with “Jumping Over the Line: Case Studies of Academics as Activists”.

Before leaving for the conference, I submitted the final paper for my markets and justice course: Resource Inequality and Environmental Sustainability.

Andrew Coyne on Peter MacKay’s departure from politics

His career at the top of Canadian politics tells us more about the state of Canadian politics than anything else. That such a palpable cipher could have remained in high office for nearly a decade is a testament to many things: the thinness of the Tory front bench, the decline of cabinet, the prime minister’s cynicism, the media’s readiness to go along with the joke. The one thing it does not signify is his importance. He had all of the titles, but little influence, and less achievement.

Hopefully this is a case where the most obvious interpretation is correct: senior Harper Conservatives expect to lose the next election, and are distancing themselves from the defeat in advance. Of course, we shouldn’t underestimate the power of the Liberals and NDP to ruin their own chances.

Lack of justification for high executive pay

The most convincing proof of the failure of corporate governance and of the absence of a rational productivity justification for extremely high executive pay is that when we collect data about individual firms (which we can do for publicly owned corporations in all the rich countries), it is very difficult to explain the observed variations in terms of firm performance. If we look at various performance indicators, such as sales growth, profits, and so on, we can break down the observed variance as a sum of other variances: variance due to causes external to the firm (such as the general state of the economy, raw material price shocks, variations in the exchange rate, average performance of other firms in the same sector, etc.) plus other “nonexternal” variances. Only the latter can be significantly affected by the decisions of the firm’s managers. If executive pay were determined by marginal productivity, one would expect its variance to have little to do with external variances and to depend solely or primarily on nonexternal variances. In fact, we observe just the opposite: it is when sales and profits increase for external reasons that executive pay rises most rapidly. This is particularly clear in the case of US corporations: Bertrand and Mullainhatan refer to this phenomenon as “pay for luck.”

Piketty, Thomas (Translated by Arthur Goldhammer). Capital in the Twenty-First Century. 2014. p. 334-5 (hardcover)

Piketty on “the illusion of marginal productivity”

Let me now return to the explosion of wage inequality in the United States (and to a lesser extent Britain and Canada) after 1970. As noted, the theory of marginal productivity and of the race between technology and education is not very convincing: the explosion of compensation has been highly concentrated in the top centile (or even the top thousandth) of the wage distribution and has affected some countries while sparing others (Japan and continental Europe are thus far much less affected than the United States), even though one would expect technological change to have altered the whole top end of the skill distribution in a more continuous way and to have worked its effects in all countries at a similar level of development. The fact that income inequality in the United States in 2000–2010 attained a level higher than that observed in the poor and emerging countries at various times in the past — for example, higher than in India or South Africa in 1920–1930, 1960–1970, and 2000–2010 — also casts doubt on any explanation based solely on objective inequalities of productivity. Is it really the case that inequality of individual skills and productivities is greater in the United States today than in the half-illiterate India of the recent past (or even today) or in apartheid (or postapartheid) South Africa? If that were the case, it would be bad news for US educational institutions, which surely need to be improved and made more accessible but probably do not deserve such extravagant blame.

Piketty, Thomas (Translated by Arthur Goldhammer). Capital in the Twenty-First Century. 2014. p. 330 (hardcover)

No mild inegalitarianism

To my knowledge, no society has ever existed in which ownership of capital can reasonably be described as “mildly” inegalitarian, by which I mean a distribution in which the poorest half of society would own a significant share (say, one-fifth to one-quarter) of total wealth.

Piketty, Thomas (Translated by Arthur Goldhammer). Capital in the Twenty-First Century. 2014. p. 258 (hardcover)

Inequality in labor and capital income

[T]he upper 10 percent of the labor income distribution generally receives 25-30 percent of total labour income, whereas the top 10 percent of the capital income distribution always owns more than 50 percent of all wealth (and in some societies as much as 90 percent). Even more strikingly, perhaps, the bottom 50 percent of the wage distribution always receives a significant share of total labor income (generally between one-quarter and one-third, or approximately as much as the top 10 percent), whereas the bottom 50 percent of the wealth distribution owns nothing at all, or almost nothing (always less than 10 percent and generally less than 5 percent of total wealth, or one-tenth as much as the wealthiest 10 percent). Inequalities with respect to labor usually seem mild, moderate, and almost reasonable (to the extent that inequality can be reasonable – this point should not be overstated). In comparison, inequalities with respect to capital are always extreme.

Piketty, Thomas (Translated by Arthur Goldhammer). Capital in the Twenty-First Century. 2014. p. 244 (hardcover)