In this paper, we exploit a new multi-country historical dataset on public (government) debt to search for a systemic relationship between high public debt levels, growth and inflation. Our main result is that whereas the link between
growth and debt seems relatively weak at “normal” debt levels, median growth rates for countries with public debt over roughly 90 percent of GDP are about one percent lower than otherwise; average (mean) growth rates are several percent lower. Surprisingly, the relationship between public debt and growth is remarkably
similar across emerging markets and advanced economies. This is not the case for inflation. We find no systematic relationship between high debt levels and inflation for advanced economies as a group (albeit with individual country exceptions including the United States). By contrast, in emerging market countries, high public debt levels coincide with higher inflation.
Although the positive association between religiosity and life satisfaction is well documented, much theoretical and empirical controversy surrounds the question of how religion actually shapes life satisfaction. Using a new panel dataset, this study offers strong evidence for social and participatory mechanisms shaping religion’s impact on life satisfaction. Our findings suggest that religious people are more satisfied with their lives because they regularly attend religious services and build social networks in their congregations. The effect of within-congregation friendship is contingent, however, on the presence of a strong religious identity. We find little evidence that other private or subjective aspects of religiosity affect life satisfaction independent of attendance and congregational friendship.
Unprecedented in its global impact, the Great Depression sounded the death knell of unfettered capitalism. Four men - all from wildly different backgrounds, all with decidedly disparate temperaments, and all equally devoted to FDR - were the primary authors of what would essentially be America’s new Constitution. Scorpions is the story of their personalities, their relationships, and above all their ideas in the crucial years of depression and war - years in which these men created the national game plan that would save the country by rebuilding the economy and defeating the Nazis and the Soviets in turn. It is also the story of how these men - Felix Frankfurter, Hugo Black, Robert Jackson , and William O. Douglas (a Jew, a Klansman, a Yankee, and a Westerner) - advised, cajoled, used, and were used by the man who brought them together and whom they all revered: President Franklin Delano Roosevelt.
“For Michael Sandel, justice is not a spectator sport,” The Nation’s reviewer of Justice remarked. In his acclaimed book—based on his legendary Harvard course—Sandel offers a rare education in thinking through the complicated issues and controversies we face in public life today. It has emerged as a most lucid and engaging guide for those who yearn for a more robust and thoughtful public discourse. “In terms we can all understand,” wrote Jonathan Rauch in The New York Times, Justice“confronts us with the concepts that lurk...beneath our conflicts.”
Affirmative action, same-sex marriage, physician-assisted suicide, abortion, national service, the moral limits of markets—Sandel relates the big questions of political philosophy to the most vexing issues of the day, and shows how a surer grasp of philosophy can help us make sense of politics, morality, and our own convictions as well.
Justice is lively, thought-provoking, and wise—an essential new addition to the small shelf of books that speak convincingly to the hard questions of our civic life.
Social justice: an ideal, forever beyond our grasp; or one of many
practical possibilities? More than a matter of intellectual discourse,
the idea of justice plays a real role in how—and how well—people live.
And in this book the distinguished scholar Amartya Sen offers a
powerful critique of the theory of social justice that, in its grip on
social and political thinking, has long left practical realities far
The transcendental theory of justice, the subject of Sen’s
analysis, flourished in the Enlightenment and has proponents among some
of the most distinguished philosophers of our day; it is concerned with
identifying perfectly just social arrangements, defining the nature of
the perfectly just society. The approach Sen favors, on the other hand,
focuses on the comparative judgments of what is “more” or “less” just,
and on the comparative merits of the different societies that actually
emerge from certain institutions and social interactions.
At the heart of Sen’s argument is a respect for reasoned
differences in our understanding of what a “just society” really is.
People of different persuasions—for example, utilitarians, economic
egalitarians, labor right theorists, no-nonsense libertarians—might
each reasonably see a clear and straightforward resolution to questions
of justice; and yet, these clear and straightforward resolutions would
be completely different. In light of this, Sen argues for a comparative
perspective on justice that can guide us in the choice between
alternatives that we inevitably face.
Throughout history, rich and poor countries alike have been lending, borrowing, crashing—and recovering—their way through an extraordinary range of financial crises. Each time, the experts have chimed, “this time is different”—claiming that the old rules of valuation no longer apply and that the new situation bears little similarity to past disasters. This book proves that premise wrong. Covering sixty-six countries across five continents, This Time Is Different presents a comprehensive look at the varieties of financial crises, and guides us through eight astonishing centuries of government defaults, banking panics, and inflationary spikes—from medieval currency debasements to today's subprime catastrophe. Carmen Reinhart and Kenneth Rogoff, leading economists whose work has been influential in the policy debate concerning the current financial crisis, provocatively argue that financial combustions are universal rites of passage for emerging and established market nations. The authors draw important lessons from history to show us how much—or how little—we have learned.
Using clear, sharp analysis and comprehensive data, Reinhart and Rogoff document that financial fallouts occur in clusters and strike with surprisingly consistent frequency, duration, and ferocity. They examine the patterns of currency crashes, high and hyperinflation, and government defaults on international and domestic debts—as well as the cycles in housing and equity prices, capital flows, unemployment, and government revenues around these crises. While countries do weather their financial storms, Reinhart and Rogoff prove that short memories make it all too easy for crises to recur.
International law scholars debate when international law matters to states, how it matters, and
whether we can improve compliance. One of the few areas of agreement is that fairly robust levels of
compliance can be achieved by tapping into states’ concerns with their reputation. The logic is intuitively
appealing: a state that violates international law develops a bad reputation, which leads other states to
exclude the violator from future cooperative opportunities. Anticipating a loss of future gains, states will
often comply with international rules that are not in their immediate interests. The level of compliance that
reputation can sustain depends, however, on how the government decision makers value the possibility of
being excluded from future cooperative agreements. This Article examines how governments internalize
reputational costs to the “state” and how audiences evaluate the predictive value of violating governments’
actions. The Article concludes that international law’s current approach to reputation is counterproductive,
because it treats reputation as an error term that makes rationalists’ claims invariably correct.
PRESIDENT OBAMA confronts the most fateful foreign policy decision
so far of his administration. Rapidly deteriorating security in
Afghanistan, the post-election political crisis in Kabul, highlighted
by Abdullah Abdullah’s decision to drop out of the runoff vote, and
General Stanley McChrystal’s request for 44,000 troops rightly spurred
Obama to call a timeout for reflection. Over the past eight weeks, in a
process with little precedent in American presidential decision-making,
the president and his advisers have held more than a half-dozen
no-holds-barred seminars examining and reexamining every dimension of
this challenge.Reduced to a single bottom line, Obama must decide whether to accept
the recommendation of his chosen military commander in the field to
Americanize this war. McChrystal’s call for more troops would expand US
forces in Afghanistan to more than 100,000 in order to execute what he
terms a “classic counterinsurgency campaign.’’Meanwhile, Senator John Kerry, chairman of the Senate Foreign
Relations Committee, delivered a major speech last week summarizing his
own analysis of the issue and offering advice about the president’s
choices. The judgments are nuanced, but no more so than the realities.On the bottom line question - yes or no on McChrystal’s
request—Kerry says no. He argues that McChrystal reaches “too far, too
fast.’’ Kerry recommends that further troop increases must meet three
conditions: reliable Afghan troops to partner with American forces,
local political leaders, and civilian advisers to speed development.
Truth be told, none of these three will be in place soon.Kerry’s analysis begins with the most important consideration: US
national interests. What should Americans care about here? What matters
more than other things that matter? Kerry says: Pakistan—not
Afghanistan. His focal question about Afghanistan is how developments
there impact Pakistan. Over the past months he has led efforts to
spotlight the anomaly that allocates 30 times more American time and
resources to Afghanistan when our much larger interests lie in
Pakistan. Thanks to his efforts with Senator Richard Lugar, the United
States has committed $7½ billion over five years to help stabilize this
nuclear-armed nation at risk of becoming the “epicenter of extremism in
the world.’’Second, what are America’s vital interests in Afghanistan? Kerry
answers that it is to “prevent the Taliban—with their long-standing
ties to Al Qaeda—from once again providing terrorists with an
unfettered Afghan safe haven.’’ Period. Note what this sparse summary
does not include: nation-building of a stable centrally-governed
Afghanistan. Like all Americans, Kerry applauds the progress
Afghanistan has made in becoming more democratic, expanding rights for
women, building schools. None of these, however, is included in his
minimum essentials for success.Third, he defines success as “the ability to empower and transfer
responsibility to Afghans as rapidly as possible and achieve a
sufficient level of stability to ensure that we can leave behind an
Afghanistan that is not controlled by Al Qaeda or the Taliban.’’ He
does not say an Afghanistan in which some Taliban are not ruling in
some areas.Fourth, he rejects “all-in’’ counterinsurgency. In its place he
recommends “smart counterinsurgency,’’ the crux of which is “limited
geographic area…as narrowly focused as possible.’’ Counterinsurgency’s
central objective is to “foster development of effective governance by
a legitimate government.’’ In contrast, the strategy Kerry recommends
could be achieved by “good enough’’ stability in Kabul and the major
population centers of a minimalist state cooperative enough to rent
bases and supply lines, provide an operating environment for attacks
against Al Qaeda, and assist with intelligence gathering.Kerry’ advances the argument by distinguishing between the vivid and
the vital, lowering ambitions to “what is achievable, measured against
the legitimate interests of the United States’’ and outlining a
strategy to that end. It is a speech that the president should, and no
doubt will, examine closely.Graham Allison is director of the Belfer Center for Science and
International Affairs at Harvard’s John F. Kennedy School of Government
and author of “Nuclear Terrorism: The Ultimate Preventable
IN the year since his election, as he has since he first appeared on the national stage, Barack Obama has embodied the fundamental paradoxes of race in America: that we live in a still racially fragmented society; that we share a public culture with an outsized black presence, but that in the privacy of homes and neighborhoods we are more segregated than in the Jim Crow era; that we worship more fervently than any other advanced nation, in churches and synagogues that define our separate ethnic identities and differences, to gods proclaiming the unity of mankind. Why are we this strange way? Is President Obama the ultimate expression of our peculiarities? Has he made a difference? Can he? Will he?We became this way because of the peculiar tragedies and triumphs of our past. Race and racism scar all advanced nations, but America is peculiar because slavery thrived internally and race became a defining feature of personal identity.Slavery was quintessentially an institution of exclusion: the slave first and foremost was someone who did not belong to and had no claims on the public order, nor any legitimate private existence, since both were appropriated by the slaveholder. The Act of Emancipation abolished only the first part of slavery, the master’s ownership; far from removing the concept of the ex-slave as someone who did not belong, it reinforced it. The nightmare of the Jim Crow era then extended and reinforced the public slavery of black Americans right up through the middle of the 20th century.At the same time, the status of blacks as permanent outsiders made whiteness a treasured personal attribute in a manner inconceivable to Europeans. Whiteness had no real meaning to pre-immigration Swedes or Irishmen because they were all white. But it became meaningful the moment they landed in America, where it was eagerly embraced as a free cultural resource in assimilating to the white republic. In America race had the same significance as gender and age as defining qualities of personhood.The great achievement of the civil rights movement was to finally abolish the lingering public culture of slavery and to create the opportunities that fostered the black middle class and black political leadership. This was a sea change. But Mr. Obama, by virtue of his unusual background as a biracial child reared by loving, though not unprejudiced, white caregivers, is acutely aware that the crude, dominating racism of the past simply morphed into a subtler cultural racism of the private sphere—significantly altered though hardly less damaging.Seeing blacks as culturally different—a perception legitimized by the nation’s celebration of diversity and identity—permits all kinds of complicated attitudes and misjudgments. Their differences can be celebrated on playing fields, dance floors and television, in theaters, hip-hop and cinema, and not least of all in that most public and ambivalently regarded arena of mass engagement: politics. But in the disciplined cultural spaces of marriages, homes, neighborhoods, schools and churches, these same differences become the source of Apollonian dread.What then can we expect of Mr. Obama? One thing we can be sure of is that he will not be leading any national conversations on race, convinced as he must be that they exacerbate rather than illuminate. During the campaign last year he spoke eloquently on the subject, but only when he was forced to do so by the uproar over the Rev. Jeremiah Wright. And since he took office, his one foray into racial politics—his reaction to the arrest of Henry Louis Gates Jr.—was a near political disaster that must have reinforced his reluctance.Mr. Obama’s writings, politics and personal relations suggest instead that he prefers a three-pronged strategy. First, he is committed to the universalist position that the best way to help the black and Latino poor is to help all disadvantaged people, Appalachian whites included. The outrage of black over-incarceration will be remedied by quietly reforming the justice system.Second, Mr. Obama appears convinced that residential segregation lies at the heart of both black problems and cultural racism. He is a committed integrationist and seems to favor policies intended to move people out of the inner cities.Third, he clearly considers education to be the major solution and has tried to lavishly finance our schools, despite the fiscal crisis. More broadly, he will quietly promote policies that celebrate the common culture of America, emphasizing the extraordinary role of blacks and other minorities in this continuing creation.At the same time, Mr. Obama seems to believe that the problems of black Americans are in part attributable to certain behaviors among them—most notably absentee fathers, dropping out of school and violence—which not only constrain their choices but rationalize the disfiguring processes of white cultural racism that extend the pathologies of the few to all black Americans. As a deeply committed family man, Mr. Obama has already made clear that he will use the bully pulpit of the presidency to encourage internal cultural reformation.All of these approaches are likely to alienate the identity-seeped segment of black leadership, and they will not prevent the extreme cultural right from accusing him of overplaying race, whatever he does.The uniqueness of Mr. Obama provides both obstacles and opportunities. My students have found that many young inner city blacks, while they admire him, find him too remote from their lives to be a role model. His policies, if properly carried out, might very well improve their chances in life, but in the end he is more likely to influence the racial attitudes of middle-class blacks and younger white Americans. This is all we can reasonably expect. It will take far more than a single presidency to fully end America’s long struggle with race.
Orlando Patterson, a professor of sociology at Harvard, is the author of The Ordeal of Integration: Progress and Resentment in America’s "Racial" Crisis.
The purpose of this book is to inform governance advisors about the vital role of the news media for governance reform. This book approaches the issue of news media and governance with three broad questions that it attempts to answer on the basis of quantitative data and case studies. First, a normative approach asks: What ideal roles should media systems play to strengthen democratic governance and thus bolster human development? Second, an empirical approach considers independent evidence derived from cross-national comparisons and from selected case studies, asking: Under what conditions do media systems actually succeed or fail to fulfill these objectives? Third, a strategic approach asks: What policy interventions work most effectively to close the substantial gap that exists between the democratic promise and performance of the news media as an institution?
Timely and pathbreaking, Securing the Peace is the first book
to explore the complete spectrum of civil war terminations, including
negotiated settlements, military victories by governments and rebels,
and stalemates and ceasefires. Examining the outcomes of all civil war
terminations since 1940, Monica Toft develops a general theory of
postwar stability, showing how third-party guarantees may not be the
best option. She demonstrates that thorough security-sector reform
plays a critical role in establishing peace over the long term.Much
of the thinking in this area has centered on third parties presiding
over the maintenance of negotiated settlements, but the problem with
this focus is that fewer than a quarter of recent civil wars have ended
this way. Furthermore, these settlements have been precarious, often
resulting in a recurrence of war. Toft finds that military victory,
especially victory by rebels, lends itself to a more durable peace. She
argues for the importance of the security sector—the police and
military—and explains that victories are more stable when governments
can maintain order. Toft presents statistical evaluations and in-depth
case studies that include El Salvador, Sudan, and Uganda to reveal that
where the security sector remains robust, stability and democracy are
likely to follow. An original and thoughtful reassessment of civil war terminations, Securing the Peace will interest all those concerned about resolving our world's most pressing conflicts.
“Growing up, I don’t know if I ever thought of becoming a teacher,” said Erez Manela, recently tenured professor of history in the Faculty of Arts and Sciences. “I was always supposed to become a doctor or a lawyer.”Manela actually began by studying foreign languages as an undergraduate at the Hebrew University of Jerusalem, not far from his hometown of Haifa, Israel. He soon discovered that courses in East Asian and Middle Eastern history complemented his interests in Chinese, Arabic, and Persian. Though he saw a future in academia, history was not a field he had expected to pursue.
“I didn’t yet conceive of it as something you could do as a profession, but rather something you might study to know more about the world,” he said.
Previously the Dunwalke Associate Professor of American History, Manela now specializes in modern international history and the history of the United States in the world. His first book, “The Wilsonian Moment: Self-Determination and the International Origins of Anticolonial Nationalism” (Oxford, 2007), explored the impact of President Woodrow Wilson’s rhetoric on nationalist movements in Asia and the Middle East in the wake of World War I. Manela’s current research revolves around the global campaign to eradicate smallpox in the 1960s and ‘70s.Manela considers his undergraduate experience the source of some of his main intellectual questions.In college, “I realized that in the modern period—during the 19th and early 20th centuries—there were really fascinating parallels between the history of the Ottoman Empire and the history of East Asia, particularly China,” Manela said. “That really intrigued me…I kept wondering how I could study these parallels in a way that wasn’t simply comparative. I wanted to put everything into one big framework and tell the story as connected.”
Manela decided to concentrate on international history as a graduate student at Yale, partly because he was reluctant to give up studying any of the countries or languages he had embraced in college.“I couldn’t bear the thought of focusing on just one of them,” he said. “I wanted to put it all to good use.”
Studying international history has allowed Manela to break free of the nation as an analytical framework and devote new attention to transnational actors, organizations, and themes. When Manela arrived at Harvard in 2003, history professors Akira Iriye (now emeritus) and the late Ernest May served as inspirational figures for him, as they too were concerned with these pioneering directions in international history. (May even taught Manela the basics of PowerPoint by jotting a few commands on an index card during his first semester at Harvard.)
“Teaching with them…was a tremendously formative experience for me,” Manela said. “Together, they established an amazing tradition of international history in this department.”
A member of Harvard’s Weatherhead Center for International Affairs, Manela considers the interdisciplinary community of scholars and students his “second home” within the University. He served as the Weatherhead’s director of undergraduate student programs for four years, and is now director of graduate student programs.
Manela spends most of his free time with his three daughters, but sometimes revisits an old interest: chess. Occasionally he challenges the regulars in Harvard Square.
“Once upon a time I used to play chess fairly well,” he said, “but that’s history.”
Manela is grateful to have the chance to study a subject that many people can pursue only as a hobby, even though he never did live up to expectations of becoming a doctor or a lawyer.
“I think this is a decent alternative,” he said with a grin.
The book offers a comprehensive account of how the world evolved to its
present state in which humans now exercise a powerful, in many cases
dominant, influence for global environmental change. It outlines the
history that led to this position of dominance, in particular the role
played by our increasing reliance on fossil sources of energy, on coal,
oil and natural gas, and the problems that we are now forced to confront
as a result of this history. The concentration of carbon dioxide in the
atmosphere is greater now than at any time over at least the past
650,000 years with prospects to increase over the next few decades to
levels not seen since dinosaurs roamed the Earth 65 million years ago.
Comparable changes are evident also for methane and nitrous oxide and
for a variety of other constituents of the atmosphere including species
such as the ozone depleting chlorofluorocarbons for which there are no
natural analogues. Increases in the concentrations of so-called
greenhouse gases in the atmosphere are responsible for important changes
in global and regional climate with consequences for the future of
global society which, though difficult to predict in detail, are
potentially catastrophic for a world poorly equipped to cope. Changes
of climate in the past were repetitively responsible for the demise of
important civilizations. These changes, however, were generally natural
in origin in contrast to the changes now underway for which humans are
directly responsible. The challenge is to transition to a new energy
economy in which fossil fuels will play a much smaller role. We need as a
matter of urgency to cut back on emissions of climate altering gases
such as carbon dioxide while at the same time reducing our dependence on
unreliable, potentially disruptive, though currently indispensable,
sources of energy such as oil, the lifeblood of the global
transportation system. The book concludes with a discussion of options
for a more sustainable energy future, highlighting the potential for
contributions from wind, sun, biomass, geothermal and nuclear,
supplanting currently unsustainable reliance on coal, oil and natural
Ha sido presidente de la Asociación de Estudios Latinoamericanos…muchos libros publicados fuera de Cuba supuestamente sobre su política
exterior se dedican en su casi totalidad al estudio de la de otros
países hacia Cuba, omitiendo un estudio serio sobre la política
exterior de Cuba. Por el contrario, los capítulos de este libro
presentan la política exterior de Cuba como un instrumento normal de un
Estado que se defiende, promueve sus intereses internacionales, y busca
ejercer un papel protagónico en el ámbito mundial. Y, sí, Cuba fue
sujeto, no simplemente objeto, en sus relaciones internacionales y ese
comportamiento merece estudio.
This article examines whether the global trend of codifying
rights in entrenched bills accompanied by judicial review to broaden
rights protection is justified. By comparing the religious freedom regimes
in Canada and England, this article finds that although the Canadian
constitutional transformation in the late twentieth century contributed
to strengthening religious freedom, its overall effect has not
been broader than the protection afforded by its primordial English
statutory model. As such, the article challenges the ongoing legal debate
over judicially enforced constitutional systems of rights. Proponents
of such systems praise their extensive contribution to rights protection,
while opponents warn against their obstructive impact on the
separation of powers. This article concludes that both sides of the debate
overstate their arguments by incorrectly presupposing the actual
effects of a judicially enforced constitutional system of rights.
A new focus within both social epidemiology and political sociology investigates how political systems and
priorities shape health inequities. To advance—and better integrate—research on political determinants of health
inequities, the authors conducted a systematic search of the ISI Web of Knowledge and PubMed databases and
identified 45 studies, commencing in 1992, that explicitly and empirically tested, in relation to an a priori political
hypothesis, for either 1) changes in the magnitude of health inequities or 2) significant cross-national differences in
the magnitude of health inequities. Overall, 84% of the studies focused on the global North, and all clustered
around 4 political factors: 1) the transition to a capitalist economy; 2) neoliberal restructuring; 3) welfare states; and
4) political incorporation of subordinated racial/ethnic, indigenous, and gender groups. The evidence suggested
that the first 2 factors probably increase health inequities, the third is inconsistently related, and the fourth helps
reduce them. In this review, the authors critically summarize these studies’ findings, consider methodological
limitations, and propose a research agenda—with careful attention to spatiotemporal scale, level, time frame
(e.g., life course, historical generation), choice of health outcomes, inclusion of polities, and specification of political
mechanisms—to address the enormous gaps in knowledge that were identified.
It is impossible to deny that all of us underestimated the resurgence of India’s Congress party. It is also equally clear that undaunted by soaring heat and a long and exhausting campaign, roughly 420 million voters have produced the best possible outcome for India in what was the largest election of world history.
Multiple factors are always involved in producing a clear outcome in Indian elections, but these elections will be widely read as a moment of national redemption and renewal and a retreat, though not the end of, parochial political noise. India’s economic downturn and security dilemmas require political stability and national resolve. Whether that is why the electorate produced such an unexpected verdict in favor of the Congress alliance remains unclear, but the election results will take India in that direction.
The wisdom of the electorate is often congratulated for such results. Only with greater election statistics, which will come later, can we establish the existence of such wisdom. It is, however, beyond doubt that a rising power like India, located in a dangerous neighborhood, needs such luck. Both South Asia and the world will be a better place as a result.The victory of the Congress alliance needs to be put in historical perspective. Right since the birth of the Indian republic -- indeed, right since the freedom movement—India’s tallest leaders have always intuitively grasped what their greatest challenge was: how to stitch the nation’s diversities together.
It was called nation-building to begin with. Of late, it has come to be viewed as giving the various groups a share in the power structure.Historically, more than any other political organization, the Congress party has understood the centrality of this task. In terms of language, it was always federal, incorporating the various regional diversities into its internal structure. In terms of religion, it sought to bring Hindus, Muslims, Sikhs and Christians together.But in terms of castes within Hindu society, India’s divided majority community, the challenges have been unexpectedly formidable. The Congress sought to put the upper castes, middle castes and the ex-untouchable Dalits together, but sandwiched between the upper castes and Dalits and feeling uncomfortable with both, the middle castes, the largest demographic category of Indian society, started leaving the Congress in the 1950s and 1960s.
By the 1990s, the migration of middle castes from the Congress in much of Northern India was nearly complete. In two of India’s biggest states, Uttar Pradesh (UP) and Bihar, the Congress was decimated by the mid-1990s.
Once the middle castes and later the Dalits formed their own political parties, Muslims and the upper Hindu castes also did not wish to back a losing horse. They left the Congress, making its hold over power in Delhi extremely shaky.Basically, UP’s size is so huge that without substantial support in UP, it is extremely hard to form a stable government in Delhi.
The electoral revival of the Congress party in UP is the biggest news of these elections. It means a return of substantial parts of the Muslim community and upper castes, in addition to some middle castes. It also signifies weakening of lower caste parties that had begun to worry even those, who supported the ideology of social justice and greater power for lower castes. Unlike the plebeian parties of Southern India, the lower caste parties of UP, and also the neighboring Bihar, had become passionate advocates of a rather coarse form of identity politics. Arguing that “Robin Hoods” corrected social injustices on the ground, they openly celebrated “Robin Hoods”, inducted them in large numbers in their parties, and gave them offices.
Identity politics came to overwhelm law and order, governance and policy seriousness. The shock delivered to such parties in Northern India in these elections almost certainly represents new citizen aspirations for governance and development, not simply an embrace of caste identity.The defeat of the Communists, especially in West Bengal, also represents a triumph of national purpose. During 2004-2008, India’s Communists were noted for their resistance to economic reforms and nuclear deal.
It is one of the hidden transcripts of Indian politics that in West Bengal, the Communists also represented a regionalist aspiration. Right through the 20th century, Kolkata and Delhi had an uneasy relationship. Kolkata was the center of British India till 1912, when the capital moved to Delhi. Since then, Kolkata and Bengal in general have felt an increasing erosion of power.The victory of a Congress alliance in West Bengal brings Kolkata into the national mainstream for the first time in over three decades. Two of India’s historic cities—Kolkata and Delhi—will now have a much better conversation, a development worth applauding.Finally, these elections have boosted the fortunes of Rahul Gandhi as a national leader and deepened the anxieties of the BJP about its future. In a coming-of-age press conference two weeks ago, Rahul Gandhi made two arguments with clarity and passion.First, economic growth, he said, is a necessary (though not a sufficient) condition for poverty removal. No politician of consequence in India’s mass politics (as opposed to its elite politics) has made this argument openly on public stage for decades.
Second, he argued that internal elections were a pre-requisite for the revival of the Congress party, especially in UP but also elsewhere. For more than three decades, the discipline of political science has had a professional consensus on this point. It is striking to see a rising political figure agree so much with what the intellectuals and researchers have been saying.The rise of the Congress in UP is mostly due to Rahul Gandhi’s efforts. Many of the national gains of the Congress will also be attributed to his electoral campaign.
The Congress party now has a leader not only known in the country for the accident of his birth, but also one whose politics appear to be based on ideas and arguments. For a whole variety of reasons, combining mass appeal with serious arguments has not been easy in Congress politics for a long time. The Congress also has other younger-generation leaders of promise.In contrast, the BJP’s future appears to be very shaky. Its current leader is too old to have the energy to lead for long, and the next in line is Mr Modi, Chief Minister of the state of Gujarat. Mr Modi, a hero of Gujarat and of the right wing of the party, is a deeply divisive figure.
In March 2002, he presided over the greatest massacre of Muslims in independent India. The BJP’s future is unlikely to be bright, unless it gets rid of its anti-Muslim prejudice and becomes a Tory or Republican-style right-of-centre party. If Mr. Modi takes over the leadership of the BJP, this historical challenge is likely to be more elusive than ever.
The 2009 elections redeem a pluralist and inclusive view of India, defeating narrower visions. The elections also promise political stability. When the campaign began in March, it was hard to imagine such a benign outcome for the country, South Asian region and the international system.
The author is professor of political science at Brown University. His books include Ethnic Conflict and Civic Life: Hindus and Muslims in India, and Midnight’s Diaspora.
If financial crises were distributed along a bell curve—like traffic accidents or people’s heights—really big ones wouldn’t happen very often. When the hedge fund Long-Term Capital Management lost 44 percent of its value in August 1998, its managers were flabbergasted. According to their value-at-risk models, a loss of this magnitude in a single month was so unlikely that it ought never to have happened in the entire life of the universe. Just over a decade later, many more of us now know what it’s like to lose 44 percent of our money. Even after the recent stock-market rally, that’s about how much the Standard & Poor’s 500 index is down compared with October 2007.
Financial crises will happen. In the 1340s, a sovereign-debt crisis wiped out the leading Florentine banks of Bardi, Peruzzi and Acciaiuoli. Between December 1719 and December 1720, the price of shares in John Law’s Mississippi Company fell 90 percent. Such crashes can also happen to real estate: in Japan, property prices fell by more than 60 percent during the ’90s.
For reasons to do with human psychology and the failure of most educational institutions to teach financial history, we are always more amazed when such things happen than we should be. As a result, 9 times out of 10 we overreact. The usual response is to introduce a raft of new laws and regulations designed to prevent the crisis from repeating itself. In the months ahead, the world will reverberate to the sound of stable doors being shut long after the horses have bolted, and history suggests that many of the new measures will do more harm than good. The classic example is the legislation passed during the British South-Sea Bubble to restrict the formation of joint-stock companies. The so-called Bubble Act of 1720 remained a needless handicap on the British economy for more than a century.Human beings are as good at devising ex post facto explanations for big disasters as they are bad at anticipating those disasters. It is indeed impressive how rapidly the economists who failed to predict this crisis—or predicted the wrong crisis (a dollar crash)—have been able to produce such a satisfying story about its origins. Yes, it was all the fault of deregulation.
There are just three problems with this story. First, deregulation began quite a while ago (the Depository Institutions Deregulation and Monetary Control Act was passed in 1980). If deregulation is to blame for the recession that began in December 2007, presumably it should also get some of the credit for the intervening growth. Second, the much greater financial regulation of the 1970s failed to prevent the United States from suffering not only double-digit inflation in that decade but also a recession (between 1973 and 1975) every bit as severe and protracted as the one we’re in now. Third, the continental Europeans—who supposedly have much better-regulated financial sectors than the United States—have even worse problems in their banking sector than we do. The German government likes to wag its finger disapprovingly at the "Anglo Saxon" financial model, but last year average bank leverage was four times higher in Germany than in the United States. Schadenfreude will be in order when the German banking crisis strikes.We need to remember that much financial innovation over the past 30 years was economically beneficial, and not just to the fat cats of Wall Street. New vehicles like hedge funds gave investors like pension funds and endowments vastly more to choose from than the time-honored choice among cash, bonds and stocks. Likewise, innovations like securitization lowered borrowing costs for most consumers. And the globalization of finance played a crucial role in raising growth rates in emerging markets, particularly in Asia, propelling hundreds of millions of people out of poverty.The reality is that crises are more often caused by bad regulation than by deregulation. For one thing, both the international rules governing bank-capital adequacy so elaborately codified in the Basel I and Basel II accords and the national rules administered by the Securities and Exchange Commission failed miserably. It was the Basel system of weighting assets by their supposed riskiness that essentially allowed the Enronization of banks’ balance sheets, so that (for example) the ratio of Citigroup’s tangible on- and off-balance-sheet assets to its common equity reached a staggering 56 to 1 last year. The good health of Canada’s banks is due to better regulation. Simply by capping leverage at 20 to 1, the Office of the Superintendent of Financial Institutions spared Canada the need for bank bailouts.
The biggest blunder of all had nothing to do with deregulation. For some reason, the Federal Reserve convinced itself that it could focus exclusively on the prices of consumer goods instead of taking asset prices into account when setting monetary policy. In July 2004, the federal funds rate was just 1.25 percent, at a time when urban property prices were rising at an annual rate of 17 percent. Negative real interest rates at this time were arguably the single most important cause of the property bubble.All of these were sins of commission, not omission, by Washington, and some at least were not unrelated to the very considerable political contributions and lobbying expenditures of the financial sector. Taxpayers, therefore, should beware. It is more than a little convenient for America’s political class to blame deregulation for this financial crisis and the resulting excesses of the free market. Not only does that neatly pass the buck, but it also creates a justification for . . . more regulation. The old Latin question is highly apposite here: Quis custodiet ipsos custodes?—Who regulates the regulators? Until that question is answered, calls for more regulation are symptoms of the very disease they purport to cure.
Is there a valid argument for international cooperation, and some form of international governance structure, in the international monetary realm? On the purely economic front, the argument is not strong. Yet a broader political economy approach concludes that national currency policy can in fact impose non-pecuniary externalities on partner nations. This is especially the case with major policy-driven misalignments, which cannot easily be countered by other governments. For example, one country’s substantially depreciated currency can provoke powerful protectionist pressures in its trading partners, so that exchange rate policy spills over into trade policy in potentially damaging ways. Inasmuch as one government’s policies create these sorts of costs for other countries, and for the world economy as a whole, there is a case for global governance. This might include some institutionalized mechanism to monitor and publicize substantial currency misalignments. While there appears to be little global political attention to such a mechanism now, there have been initiatives along these lines at the regional level, and the current crisis may have stimulated more general stirrings of interest.
This book contains some of the newest, most exciting ideas now percolating among political scientists, from hallway conversations to conference room discussions. To spur future research, enrich classroom teaching, and direct non-specialist attention to cutting-edge ideas, a distinguished group of authors from various parts of this sprawling and pluralistic discipline has each contributed a brief essay about a single novel or insufficiently appreciated idea on some aspect of political science. The one hundred essays are concise, no more than a few pages apiece, and informal. While the contributions are highly diverse, readers can find unexpected connections across the volume, tracing echoes as well as diametrically opposed points of view. This book offers compelling points of departure for everyone who is concerned about political science - whether as a scholar, teacher, student, or interested reader.