Publications

There is nothing like a really big economic crisis to separate the Cassandras from the Panglosses, the horsemen of the apocalypse from the Kool-Aid-swigging optimists. No, the last year has shown that all is not for the best in the best of all possible worlds. On the contrary, we might be doomed.

At such times, we do well to remember that most of today’s public intellectuals are mere dwarves, standing on the shoulders of giants. So, if they had e-mail in the hereafter, which of the great thinkers of the past would be entitled to send us a message with the subject line: “I told you so”? And which would prefer to remain offline?

It has, for example, been a bad year for Adam Smith (1723-1790) and his “invisible hand,” which was supposed to steer the global economy onward and upward to new heights of opulence through the action of individual choice in unfettered markets. By contrast, it has been a good year for Karl Marx (1818-1883), who always maintained that the internal contradictions of capitalism, and particularly its tendency to increase the inequality of the distribution of wealth, would lead to crisis and finally collapse. A special mention is also due to early 20th-century Marxist theorist Rudolf Hilferding (1877-1941), whose Das Finanzkapital foresaw the rise of giant “too big to fail” financial institutions.

Joining Smith in embarrassed silence, you might think, is Friedrich von Hayek (1899-1992), who warned back in 1944 that the welfare state would lead the West down the “road to serfdom.” With a government-mandated expansion of health insurance likely to be enacted in the United States, Hayek's libertarian fears appear to have receded, at least in the Democratic Party. It has been a bumper year, on the other hand, for Hayek's old enemy, John Maynard Keynes (1883-1946), whose 1936 work The General Theory of Employment,Interest and Money has become the new bible for finance ministers seeking to reduce unemployment by means of fiscal stimuli. His biographer, Robert Skidelsky, has hailed the “return of the master.” Keynes's self-appointed representative on Earth, New York Times columnist Paul Krugman, insists that the application of Keynesian theory, in the form of giant government deficits, has saved the world from a second Great Depression.

The marketplace of ideas has not been nearly so kind this year to the late Milton Friedman (1912-2006), the diminutive doyen of free-market economics. “Inflation,” wrote Friedman in a famous definition, “is always and everywhere a monetary phenomenon, in the sense that it cannot occur without a more rapid increase in the quantity of money than in output.” Well, since September of 2008, Ben Bernanke has been printing dollars like mad at the U.S. Federal Reserve, more than doubling the monetary base. And inflation? As I write, the headline consumer price inflation rate is negative 2 percent. Better throw away that old copy of Friedman's Monetary History of the United States, 1867-1960 (co-authored with Anna J. Schwartz, who is happily still with us).

Invest, instead, in a spanking new edition of The Great Transformation by Karl Polanyi (1886-1964). We surely need Polanyi's more anthropological approach to economics to explain the excesses of the boom and the hysteria of the bust. For what in classical economics could possibly account for the credulity of investors in Bernard Madoff's long-running Ponzi scheme? Or the folly of Richard Fuld, who gambled his personal fortune and reputation on the very slim chance that Lehman Brothers, unlike Bear Stearns and Merrill Lynch, could survive the crisis without being sold to a competitor?

The biggest intellectual losers of all, however, must be the pioneers of the theory of efficient markets—economists still with us, such as Harry M. Markowitz, the University of Chicago-trained economist who developed the theory of portfolio diversification as the best protection against economic volatility, and William Sharpe, inventor of the capital asset pricing model. In two marvelously lucid books, the late Peter Bernstein extolled their “capital ideas.” Now, with so many quantitative hedge funds on the scrap heap, their ideas don't seem quite so capital.

And the biggest winners, among economists at least? Step forward the "Austrians" —economists like Ludwig von Mises (1881-1973), who always saw credit-propelled asset bubbles as the biggest threat to the stability of capitalism. Not many American economists carried forward their work into the later 20th century, but one heterodox figure has emerged as a posthumous beneficiary of this crisis: Hyman Minsky (1919-1996). At a time when other University of Chicago-trained economists were forging the neoclassical synthesis—Adam Smith plus applied math—Minsky developed his own math-free “financial instability hypothesis.”

Yet it would surely be wrong to make the Top Dead Thinker of 2009 an economic theorist. The entire discipline of economics has flopped too embarrassingly for that to be appropriate. Instead, we should consider the claims of a historian, because history has served as a far better guide to the current crisis than any economic model. My nominee is the financial historian Charles Kindleberger (1910-2003), who drew on Minsky's work to popularize the idea of financial crisis as a five-stage process, from displacement and euphoric overtrading to full-fledged mania, followed by growing concern and ending up with panic. (If those five steps to financial hell sound familiar, they should. We just went down them, twice in the space of 10 years.)

Of course, history offers more than just the lesson that financial accidents will happen. One of the most important historical truths is that the first draft of history —the version that gets written on the spot by journalists and other contemporaries —is nearly always wrong. So though superficially this crisis seems like a defeat for Smith, Hayek, and Friedman, and a victory for Marx, Keynes, and Polanyi, that might well turn out to be wrong. Far from having been caused by unregulated free markets, this crisis may have been caused by distortions of the market from ill-advised government actions: explicit and implicit guarantees to supersize banks, inappropriate empowerment of rating agencies, disastrously loose monetary policy, bad regulation of big insurers, systematic encouragement of reckless mortgage lending—not to mention distortions of currency markets by central bank

Consider this: The argument for avoiding mass bank failures was made by Friedman, not Keynes. It was Friedman who argued that the principal reason for the depth of the Depression was the Fed's failure to avoid an epidemic of bank failures. It has been Friedman, more than Keynes, who has been Bernanke’s inspiration over the past two years, as the Fed chairman has honored a pledge he made shortly before Friedman's death not to preside over another “great contraction.” Nor would Friedman have been in the least worried about inflation at a time like this. The Fed's balance sheet may have expanded rapidly, but broader measures of money are growing slowly and credit is contracting. Deflation, not inflation, remains the monetarist fear.

From a free market perspective, the vital thing is that legitimate emergency measures do not become established practices. For it cannot possibly be a healthy state of affairs for the core institutions of the Western financial system to be effectively guaranteed, if not actually owned, by the government. The thinker who most clearly discerned the problems associated with that kind of state intervention was Joseph Schumpeter (1883-1950), whose “creative destruction” has been one of this year's most commonly cited phrases.

“[T]his evolutionary…impulse that sets and keeps the capitalist engine in motion,” wrote Schumpeter in Capitalism, Socialism and Democracy, “comes from…the new forms of industrial organization that capitalist enterprise creates…This process of creative destruction is the essential fact about capitalism.” This crisis has certainly unleashed enough economic destruction in the world (though its creativity at this stage is still hard to discern). But in the world of the big banks, there has been far too little destruction, and about the only creative thing happening on Wall Street these days is the accounting.

“This economic system,” Schumpeter wrote in his earlier The Theory of Economic Development, “cannot do without the ultima ratio [final argument] of the complete destruction of those existences which are irretrievably associated with the hopelessly unadapted.” Indeed, he saw that the economy remained saddled with too many of “those firms that are unfit to live.” That could serve as a painfully accurate description of the Western financial system today.

Yet all those allusions to evolution and fitness to live serve as a reminder of the dead thinker we should all have spent at least part of 2009 venerating: Charles Darwin (1809-1882). This year was not only his bicentennial but the 150th birthday of his paradigm-shifting On the Origin of Species. Just reflect on these sentences from Darwin's seminal work:

All organic beings are exposed to severe competition.”

“As more individuals are produced than can possibly survive, there must in every case be a struggle for existence.”

“Each organic being…has to struggle for life and to suffer great destruction.... The vigorous, the healthy, and the happy survive and multiply.”

Thanks in no small measure to the efforts of his modern heirs, notably Richard Dawkins, we are all Darwinians now—except in the strange parallel worlds of fundamentalist Christianity and state-guaranteed finance.

Neither Cassandra nor Pangloss, Darwin surely deserves to top any list of modern thinkers, dead or alive.

Between February and June 2009, French universities were the theatre of an exceptional protest movement against the latest flavour of governmental reform concerning academic careers. Protest sometimes seems to be a way of life in the French academy, and in France at large, but this time the situation is serious, with potentially huge consequences for the future of the sector. Indeed, the nation that gave birth to je pense, donc je suis is in a deep crisis on the intellectual front, and nowhere is this as obvious as in academic evaluation.

The protest movement did not take off in the grandes écoles (which train much of the French elite), or in professional and technical schools. Instead, it took off in the 80 comprehensive universités—the public institutions that are the backbone of the French educational system. Until two years ago, they were required to admit any high-school graduate on a first-come, first-served basis. A selection process was recently introduced, but even today most students are there because they could not gain entry elsewhere. Faculty work conditions are generally poor, as their institutions are chronically underfunded. Classes are large and programmes are understaffed. More than half of all students leave without any kind of diploma.

Public universities can be very different from each other and are research-intensive in varying degrees, but they carry out the bulk of French scientific research. Research is largely conducted in centres that are located within these institutions, and which often bring together overworked university teachers and full-time researchers who are attached to national institutes such as the Centre National de la Recherche Scientifique (CNRS). In a context where the output of these joint centres is not, or is only partially, covered by international ratings, French academics feel doubly underrated owing to the combination of low salaries and low ratings.

This feeling was exacerbated on 22 January when President Nicolas Sarkozy declared that the poor performance of French universities in international rankings was, above all, the consequence of the absence of continuous evaluation, which encourages sloth. Of course, he was displeased that the extensive set of higher education reforms undertaken by his Government during the preceding two years were met with opposition by large segments of the academic community.

Everyone agrees that the current system poses a great many problems, but there is no agreement on how to improve it and get beyond the current gridlock. It is la société bloquée all over again. To wit:

- While most academics believe that the system is far too centralised, a 2007 law establishing the progressive financial “autonomy” (and accountability) of universities has been met with criticism and resistance, because it is perceived to be part of a strategy of withdrawal on the part of the State that will result in fewer resources being available for higher education. A number of scholars also fear that the increased decision-making power conferred on university presidents is a threat to the autonomy of faculty members.

- While there is a need to design new, more universalistic procedures for evaluating performance and distributing resources, many academics are sceptical of the new institutions recently created to do this, namely the national agencies for the evaluation of universities and research units (Agence d'Evaluation de la Recherche et de l'Enseignement Superieur, or AERES) and research projects (Agence Nationale de la Recherche, or ANR). The former, in particular, has been criticised for its reliance on bibliometrics (publication and citation counts), even if the agency is now moving towards using less quantitative standards. Moreover, whereas the former mechanisms for distributing research funds depended on the decisions of elected peers (for instance, on the national committee of the CNRS), AERES appoints its panel members, and this is seen as a blow to researchers' autonomy. For this and other reasons, many academics have refused to serve on its evaluation panels.

- While academics often agree that the old CNRS needed further integration with the universities, many denounce its gradual downsizing and transformation from a comprehensive research institution to a simple funding and programming agency as the work of uninformed politicians and technocrats intent on dismantling what works best in French research. In 2004, a widespread national protest arose against this dismantling, with 74,000 scholars signing a petition against it. Critics also say that the ongoing reorganisation of the CNRS into disciplinary institutes will reinforce the separation between the sciences, reorient research towards more applied fields and work against the interdisciplinary collaborations that are crucial to innovation in many fields.

- While many agree on the need to improve teaching, moves to increase the number of teaching hours are among the most strongly contested reforms. French academics, who very rarely have sabbaticals, already perceive themselves as overworked in a system where time for research is increasingly scarce. These factors help to explain the resistance to expanded classroom hours and new administrative duties.

In the longest strike ever organised by the French scientific community, tens of thousands of lecturers and researchers began in early February to hold protests over a period of several weeks, demonstrating in the streets and (with the support of some students) blocking access to some university campuses. Many also participated in a national debate via print, online and broadcast media, and in general meetings. Some faculty members held teach-ins and action-oriented “alternative courses” for students. Several universities saw their final exams and summer holidays delayed and many foreign exchange students were called back by their home institutions. Despite this frontal assault, the Government did not back down: the much disparaged decree reorganising academic careers (with regard to recruitment, teaching loads, evaluations and promotions) and giving more prerogatives and autonomy to university presidents came into effect on 23 April.

This outcome will probably lead academics and their unions to rethink their strategies and repertoires of collective action. The traditional protest forms are losing legitimacy. As the dust settles, it is becoming clear that demonstrating has little traction in a context where the French public increasingly perceives academics as an elite bent on defending its privileges, even if it requires depriving students of their courses. Negotiation is also perceived as ineffectual, as many suspect that governmental consultations were conducted to buy time until the end of the academic year, when mobilisation would peter out. A third strategy—the radical option that would have prevented the scheduling of exams and the handing out of diplomas at the end of this spring—was ruled out even on the campuses most committed to the cause for fear of alienating the public even further.

As yet, however, no clear alternative has surfaced. We are now witnessing a cleavage between those who voice their opposition (in the main, scholars in the humanities) and the increasing number of academics (primarily scientists) who espouse a “wait-and-see” or a collaborative position as the only realistic path to improving the situation in their own universities. If the majority of academics appear to share the same diagnosis about what needs to be changed in the French system, they disagree on the solution (and on its scale—national or local). The root of the crisis lies not only in the Government's difficulties in generating consensus, but also in the academics' own scepticism, cynicism or fatalism about meritocracy, the absence of the administrative resources needed to support proper evaluation, the possibility of impartial evaluation, and the system's ability to recognise and reward merit.

Deep problems remain in the institutions charged with evaluating the work of academics. The interference of political power, and the (admittedly diminishing) influence of trade unions and corporatist associations have long been viewed as obstacles to a collegial system of academic evaluation. The legitimacy of the 70 disciplinary sections of the Conseil National des Universites (CNU)—charged with certifying individuals as eligible for faculty positions, and with directly granting some promotions—is under question. Some of its committee members are appointed by the Government and as such are suspected of being second-rate, of benefiting from governmental patronage, or of defending governmental interests. Others are chosen from electoral lists that include a disproportionate number of partisan members, who are often perceived to be there because of their political involvement rather than because of their scientific status.

The legitimacy of these committees is further called into question because they include only academics employed by French institutions and are often viewed as perpetuating a longstanding tradition of favouritism. To give only one particularly scandalous example: in June, panellists in the sociology section allocated to themselves half of the promotions that they were charged with assigning across the entire discipline of sociology. This led to the resignation of the rest of the commission and to multiple protests. Such an occurrence sent deep waves of distrust not only between academics, but also towards the civil servants charged with reforming a system that is increasingly viewed as flawed.

Peer review is also in crisis at the local level. While selecting young doctoral recipients to be maîtres de conférences (the entry level permanent position in the French academy, similar to the British lecturer), French universities on average fill 30 per cent of available posts with their own graduates, to the point where local clientelism is often decried as symbolising the corruption of the entire system. The typical (and only) job interview for such a post lasts 20 to 30 minutes—probably the European record for brevity and surely too short to determine whether an individual deserves what is essentially a lifelong appointment. Many view the selection process as little more than a means to legitimise the appointment of pre-selected candidates—although the extent to which this is genuinely the case varies across institutions.

What is to be done? Because both the CNU and the local selection committees have recently been reorganised or granted new responsibilities, it seems the right moment to think about how to improve the evaluation processes in very practical ways. As part of a new start, academics should aim to generate a system of true self-governance at each level, grounded in more explicit principles for peer review. This would put them in a position to defend academic autonomy against the much-feared and maligned governmental or managerial control. While this is certainly occurring in some disciplines and institutions, progress is far from being equally spread across the sector.

Obvious and costless regulatory measures could easily be implemented—for instance, discouraging universities from hiring their own PhD graduates (as AERES recently started to), or forbidding selection committees from promoting their own members. One could also look abroad for examples of “best practice”. The UK's Economic and Social Research Council has created colleges of trained academic evaluators who are charged with maintaining academic and ethical standards in peer review; although not all aspects of the British approach to academic reform should be emulated, this one is particularly worthy.

The Deutsche Forschungsgemeinschaft (German Research Foundation) uses teams of elected experts to evaluate proposals, and academic reputation weighs heavily in determining which names will be put on electoral lists and who will serve on evaluation panels. Canada's Social Sciences and Humanities Research Council recently asked an independent panel of international experts to evaluate its peer review process in order to improve impartiality and effectiveness.

In a recent book on peer review in the US, one of the present authors (Michele Lamont) showed the ways in which American social scientists and humanists operate to maintain their faith in the idea that peer review works and that the academic system of evaluation is fair. In this case, academics exercise their right as the only legitimate evaluators of knowledge by providing detailed assessment of intellectual production in light of their extensive expertise in specialised topics. The exercise of peer evaluation sustains and expresses professional status and professional autonomy. But it requires significant time (and thus good working conditions) and moral commitment—time spent comparing dossiers, making principled decisions about when it is necessary to withdraw on the grounds of personal interest, and so forth. Of course no peer review works perfectly, but US academics, while being aware of its limitations, appear to view the system as relatively healthy and they engage in many actions that contribute to sustaining this faith.

In our view, fixing the current flaws in the French system does not merely demand organisational reforms, including giving academics more time to evaluate the research of colleagues and candidates properly. It may also require French academics to think long and hard about their own cynicism and fatalism concerning their ability to make judgments about quality that would not be driven by cronyism or particularism, and that would honour their own expertise and connoisseurship.

Not that proper governmental reform is not needed, but sometimes blaming the Government may be an easy way out. Above all, it is increasingly a very ineffectual way of tackling a substantial part of the problem. A little more collaborative thinking and a little less cynicism among both academics and administrators—if at all possible - may very well help French universities find a way out of the crisis. And it will help the French academic and research community to become, once again, much more than the sum of its parts.

The unemployment rate has topped 10% for the first time in a quarter-century. More than one in six adults are unemployed or underemployed, the most since the Great Depression. By any measure this is troubling, but the long-term effects of unemployment are more devastating than most Americans grasp. Economists warn that high unemployment may persist for years.

Misery, it turns out, doesn't love company. Distressing new research shows that unemployment fosters social isolation not just for the unemployed but also for their still-employed neighbors. Moreover, the negative consequences last much longer than the unemployment itself. Policymakers have focused on short-term help for the jobless, but they must address these longer-term community effects, too.

Impact studied

Recent studies confirm the results of research during the Great Depression— unemployment badly frays a person's ties with his community, sometimes permanently. After careful analysis of 20 years of monthly surveys tracking Americans' social and political habits, our colleague Chaeyoon Lim of the University of Wisconsin has found that unemployed Americans are significantly less involved in their communities than their employed demographic twins. The jobless are less likely to vote, petition, march, write letters to editors, or even volunteer. They attend fewer meetings and serve less frequently as leaders in local organizations. Moreover, sociologist Cristobal Young's research finds that the unemployed spend most of their increased free time alone.

These negative social consequences outlast the unemployment itself. Tracking Wisconsin 1957 high school graduates, sociologists Jennie Brand and Sarah Burgard found that in contrast to comparable classmates who were never unemployed, graduates who lost jobs, even briefly and early in their careers, joined community groups less and volunteered considerably less over their entire lives. And economist Andrew Clark, psychologist Richard Lucas and others found that, unlike almost any other traumatic life event, joblessness results in permanently lower levels of life satisfaction, even if the jobless later find jobs.

Equally disturbing, high unemployment rates reduce the social and civic involvement even of those still employed. Lim has found that Americans with jobs who live in states with high unemployment are less civically engaged than workers elsewhere. In fact, most of the civic decay in hard-hit communities is likely due not to the jobless dropping out, but to their still-employed neighbors dropping out.

Moreover, beyond civic disengagement, places with higher joblessness have more pervasive violence and crimes against property. They have more fragile families with harsher parenting, and higher rates of mental disorder and psychological distress among both the unemployed and the employed. These social consequences are a powerful aftershock to communities already reeling economically.

What might explain the civic withdrawal during recessions? The jobless shun socializing, shamed that their work was deemed expendable. Economic depression breeds psychological depression. The unemployed may feel that their employer has broken an implicit social contract, deflating any impulse to help others. Where unemployment is high, those still hanging onto their jobs might work harder for fear of further layoffs, thus crowding out time for civic engagement. Above all, in afflicted communities, the contagion of psychic depression and social isolation spreads more rapidly than joblessness itself.

What to do?

The lasting social consequences of unemployment demand remedy. President Obama has extended individual unemployment benefits.These new findings call for special aid to communities with high and persistent unemployment. Government and business should ensure that unemployment is a last cost-cutting move, not the first.

Millions of employed Americans are silently thankful that the sword of Damocles has not yet fallen on them. Meanwhile, they and their leaders overlook the fact that unemployment is causing long-run social disintegration in their communities. Albert Camus was right: “Without work, all life goes rotten.”

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.

Contemporary democratic reality is characterized by the growing role of courts in politics, as social activists regularly utilize the judicial process in an attempt to secure their values and interests as law. Observers of constitutional politics generally explain this phenomenon in the recent constitutional transformations worldwide, manifested primarily in the enactment of bills of rights accompanied by judicial review powers. These constitutional transformations enabled and simplified the ability of those with limited access to the majoritarian-led parliamentary process to challenge governmental policies through the courts.¹ As a result, law has come to be perceived as a compelling mechanism to effectuate progressive change and facilitate authoritative resolutions to conflicts.² In societies divided along religious lines, the appeal of litigation has been particularly strong, with secular and religious groups increasingly viewing it as a principal opportunity to mold the public sphere in accordance with their political and moral preferences.

This paper seeks to evaluate the efforts to achieve these perceived goals—of effectuating change and managing conflict—through the judicial process, by examining its effects in the context of the religion-based conflicts of India and Israel. By way of an empirical comparison the paper considers: (i) the judicial impact on the realization of fundamental rights, the rectification of existing discriminatory practices, and the advancement toward a more pluralist and egalitarian society; (ii) the judicial contribution to generating authoritative resolution to religion-based conflicts; and (iii) possible long term social and political implications stemming from judicial intervention in policy questions concerning hotly disputed religion-based conflicts.

Scholars of comparative federalism generally call India’s linguistic federation a spectacular institutional success. One of the greatest indicators of the success is the disappearance of language riots, common in the 1950s and 1960s, after the linguistic reorganisation of states was completed. But for all its successes, India’s federalism now faces a new and extremely serious challenge.

Central to India’s internal security are three laws and practices.

First, according to India’s Constitution, internal law and order are entirely on the so-called “state list”, not on the “Central list” or “concurrent list”. Only under President’s rule can Delhi take over the internal security of a state. “Federal crime” is not a concept in Indian law, as is it in the US, and it cannot be introduced unless the Constitution is amended. Its relevance has been debated within government circles since the late 1960s, but the idea of federal crimes remains legally elusive. Even when the Indian Airlines flight from Kathmandu was diverted to Kandahar in December 1999, leading to India’s external affairs minister agreeing to a humiliating agreement that released well-known terrorists from Indian jails in return for the safety of passengers, the case was not, and could not be, registered as a federal crime. Indian Airlines reported to Delhi police that its plane, due to arrive in Delhi, was missing. “Hamaara hawaai jahaaz nahin aayaa”. It was registered as a Delhi-based crime.

Second, Central agencies—including the national security guards (or commandos), who are especially trained for urban terrorism—simply cannot function without the cooperation of state police. Requisition from state governments is legally required before the commandos can be used. India’s commandos were all based in Delhi when Mumbai was terrorised. After Mumbai, hubs have been created in Hyderabad, Chennai, Kolkata and Mumbai. As a consequence, they can be deployed more quickly, but for operations, they still need the assistance of state police. NSG commandos have no knowledge of local specificities. State police remains the greatest repository of ground-level intelligence in India.

Third, all serious students of terrorism recognise that intelligence is central to the prevention of terrorism. Since terrorists are willing to sacrifice their lives, one can only try to minimise damage, not avoid it, once the act of terror has begun. Unfortunately, India’s intelligence system is fractured and weak. The Central Bureau of Investigation (CBI), the institution often identified as the leading intelligence agency of India, is most unlike America’s Federal Bureau of Investigation (FBI). In contrast to the FBI, which combines intelligence and investigation functions, the CBI is primarily an ex-post investigation body, not an intelligence collecting agency. For the latter, it depends primarily on state police, and secondarily on Delhi’s Intelligence Bureau (IB).

The CBI was established under the Delhi Special Police Establishment Act, 1946. Its direct jurisdiction covers Delhi and the centrally administered Union Territories. Unlike the FBI, it can not pursue investigation at the state level on its own. To investigate, it must receive state requisition or consent, or be ordered to do so by the Supreme Court or a High Court. In other words, for it to function well, it depends heavily on state police. It can also team up with Delhi’s Intelligence Bureau (IB), but the IB reports to India’s home ministry, whereas the CBI reports to the ministry of personnel. The cooperation is not always forthcoming. More importantly, the IB simply does not have the same intelligence-gathering machinery as the state police does. State governments have the constitutional right to deny permission for CBI investigations. Goa, for example, did so during the late 1990s. Maharashtra did not hand over cases concerning the Mumbai blasts of 1993 to the CBI for almost a year. Northeastern states have often denied permission to the CBI.

At the root of this problem is the dark underbelly of Indian politics: corruption and vendetta. The CBI is not trusted by state leaders for they believe it is politically used by Delhi to target adversaries. The adversaries may be accused of corruption, or even violent crime. It does not matter that such corruption or criminal conduct may often be real, not imagined. But over the last 20-30 years, as politicians accused of crime and corruption have, in particular, risen in politics, the CBI has been caught in a political crossfire. Delhi often wants to use it, but the CBI faces enormous resistance at the state level, especially if the state government is run by a coalition or political party different from that ruling in Delhi.

So long as the Congress party ruled both in Delhi and the states, there was no such resistance. Such matters were handled as internal negotiations within the party. Moreover, in the 1950s and 1960s, the era of Congress dominance, no one had imagined the possibility of terror, let alone cross-border terror. The rise of a coalitional era might have made Indian politics much more democratic, federal and competitive, but national security has suffered as a consequence.

Although this problem cannot be fully resolved unless corruption and crime begin to disappear from Indian politics, India’s political process has thrown up a potential solution. Via a Parliamentary act, a National Investigation Agency (NIA) was created after the Mumbai attacks. In theory, the NIA can become India’s FBI, but serious impediments remain.

The NIA Act was created using an entry related to defence of India on the Central list. Of all security matters, only defence of India is handled by Delhi. What is generally called internal, as opposed to external, security is almost entirely under state jurisdiction. The NIA Act is not a constitutional amendment, which would have required approval of two thirds of Parliament and half the states, not easily possible in a coalitional era. The concept of a federal crime, requiring a constitutional amendment, has still not been introduced precisely for the same reason. States would not give consent if they believe that the NIA might become a much more powerful CBI.

The NIA does not yet have an elaborate organisational structure of its own. And that may not happen until two conditions are satisfied. First, if more Mumbai-style attacks happen, it is possible for security to become an overriding national objective that no political party can ignore without peril. Thus far, terrorism is an element in India’s elite politics, not in its mass politics. It does not determine election outcomes. Second, if the Congress party, currently showing signs of revival, becomes even stronger, both in national Parliament and at the state level, it would also allow the possibility of a constitutional amendment. The first condition is not desirable, the second somewhat improbable, if not impossible, at the moment.

India’s home minister is well known for his intellectual firepower, but his hands are tied. He can only do the following: modernise the intelligence system through new technologies; try to generate a better knowledge system—for example, a national counter-terrorism centre—that supports national security; create institutions that seek to coordinate the rather fractured intelligence. State governments might also create their own commando forces, as Maharashtra appears to be doing and Andhra did some years back. All of these measures would help, but the home minister cannot legally force a state government to accept the dictates of the NIA unless a constitutional amendment introducing the concept of federal crime is put through. However desirable such a concept in the 21st century might be, India’s federal polity will not easily allow it to come about.

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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 behind.

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.

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 Catastrophe.’’

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.

It is a commonplace to recall that the Universal Declaration of Human Rights (UDHR) integrated civil and political rights (CPR) with economic, social, and cultural rights (ESCR), and that the two International Covenants separated them.

Reflecting Cold War divisions, stress on one or the other of these two traditional categories tended to reveal preferences for neoliberal or social democratic understandings of human rights, when it was not more blatantly reflective of competition between the NATO and Warsaw Pact (plus "Non-Aligned") countries, a sort of North–West vs. East–South ideological split. This article explores how the separation of categories of rights has lost its pertinence in the first decade of the 21st century. My purpose is to show how the separation into two categories is perhaps a convenient taxonomy for some, but subject to serious challenge from the perspectives of political history, the theory of rights, and contemporary policy.

By sharing one of the longest land borders in the world, the United States and Mexico will always have a special relationship. In the early twenty-first century, they are as important to one another as ever before with a vital trade partnership and often-tense migration positions. The ideal introduction to U.S.-Mexican relations, this book moves from conflicts all through the nineteenth century up to contemporary democratic elections in Mexico.

Domínguez and Fernández de Castro deftly trace the path of the relationship between these North American neighbors from bloody conflict to (wary) partnership. By covering immigration, drug trafficking, NAFTA, democracy, environmental problems, and economic instability, the second edition of The United States and Mexico provides a thorough look back and an informed vision of the future.