Category Archives: economy

British Budget: Progressive or Regressive?

By Nikita Lalwani

LONDON — This past week has been an exciting one for British politics. On Tuesday, George Osborne – the youngest ever Chancellor of the Exchequer – unveiled the emergency budget to much media attention and public debate. As many expected, the budget responded to the economic crisis with fiscal austerity. From the New York Times article on the budget:

The steps outlined to the House of Commons by George Osborne, the chancellor of the Exchequer, would cut the annual government deficit by nearly $180 billion over the next five years, shrinking Britain’s public sector and instituting tough reductions in public housing benefits, disability allowances and other previously sacrosanct aspects of the country’s $285 billion welfare budget.

Only time will tell if these cuts will herald a new era of prosperity and smart spending or catalyze a double-dip recession. What was readily apparent from the post-budget debates, though, was the way in which the three parties interacted with each other and the strategic way each chose to portray the coalition.

Conservatives seem pleased with the budget. They argue that cuts were necessary, and they constantly remind Labour that they are at fault for Britain’s financial predicament. The numbers, they say, show results – the increase in value-added tax alone will raise $18 billion by 2012. Of course, the budget suits Conservatives ideologically as well, as it puts them on their way to small government and to a smaller public sector. To counteract this, Conservatives have highlighted Liberal Democrat contributions to the budget, emphasizing their commitment to protecting the most vulnerable in society.

Not surprisingly, Labour MPs have claimed just the opposite: they have criticized the extensive budget cuts, claiming that Tories are trying to bring back Thatcher-era reforms while harming society’s poorest and most vulnerable. They have criticized Liberal Democrats for compromising their ideals in support of a budget they perceive to be quintessentially conservative. Labour’s strategy seems to be to undermine the coalition at all costs. They constantly refer to the “Tory budget” – although the budget is a combination of Conservative and Liberal Democrat policy – to portray Liberal Democrats as an insignificant and ignored part of government.  Their rhetoric seems designed to create a rift between the two coalition parties. In Thursday’s budget debate, for instance, Labour MP Edward Miliband all but urged Liberal Democrats to unite against Conservatives in next week’s vote.

Liberal Democrats, by contrast, are quick to point out their contribution to the budget, which most seem ready to support. Deputy Prime Minister Nick Clegg, in a letter to the party, emphasized the more progressive elements of the budget. Liberal Democrats are right that their contribution is apparent, from an increase in Capital Gains Tax that will target the wealthy to an increase in state pensions that correlates to earnings and inflation. So far, Liberal Democrats have stuck to their line that the budget will result in a fairer Britain for all. Ultimately, Liberal Democrats are smart not to rock the boat. The coalition is still new, and the two parties are still learning how to work together. It is best for the success of the coalition if the two parties seem to be on the same side, at least for now. But how much compromise is too much? Many Lib Dem voters may feel betrayed, particularly when they start to feel the effects of the budget in the coming years (I have already opened several derogatory letters at the office). Britain’s third party must walk a fine line between sticking to their Liberal principles and effectively compromising with the Conservatives. It is a tough balance to strike.

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Culture and the Cup, Dispatch 2: Buenos Aires

By Ramon Gonzalez

BUENOS AIRES — It began as a World Cup, has become South America’s, and the hope here is that it will end as Argentina’s. With confident play so far and brief glimpses of brilliance, the national squad has grounded the faith here in reason, and to see a well-coiffed Diego Maradona patrolling the sidelines in a suit makes one believe in the providential workings of the Hand of God.

With the recent and (here) delightful collapse of the French team, the struggles of Old Europe, the bizarre and card-happy referring which makes even NBA referees appear competent, the charming American exuberance, and the sincere concerns for the North Korean’s coach’s return home, the travails of Argentina’s qualifying campaign have largely faded from mind. I believe, however, that they do deserve a brief nod. Argentina suffered through a 6-1 thrashing from Bolivia (the second to worst team in the continent). It spent many long nights and days discussing why Lionel Messi — Argentina’s star and the world’s best player — could not replicate the form that graced his club play for Barcelona, risked seeing Coach Diego Maradona — the best player in Argentina’s history and among the best ever — suffer the indignity of helming this tragic failure, squeezed into the last automatic qualifying slot from South America, and sat through verbal volleys in the press from players, coaches, and administrators that mucked through the lewd to make their points. So Argentina can be forgiven her present excitement.

Besides offering irregular soccer commentary, in Buenos Aires I am working at the Argentina Council for International Relations where you’ll find my writing on the G20 Finance Ministers’ Meeting, Obama’s National Security Strategy, forecasts about European financial trouble, and a preview of the upcoming G20 conference in Toronto (sorry, but Spanish only). To whet your appetite and in case your favorite team books an earlier than expected flight home from South Africa, I’ll soon be covering (provided Argentina (or the US or Spain – I’m working the odds here) doesn’t do too well) the consequences of Juan Manuel Santos’ victory in the second round of the Columbian Presidential elections and Argentine debt and trade disputes. Please pace your reading so you don’t overload the servers all at once.

Let’s return to the game. Or rather, the game surrounding the game, as there is little of much interest to say about Argentina’s productive and solid victories against rather outmatched competition. As most of the matches fall here during normal working hours, many employers have taken to setting up televisions in the office for everyone to gather around, a clear-eyed concession to the reality that when the national team plays, everything stops. For those caught walking on the streets, a symphony of car horns keeps all abreast of an Argentine goal, and inside the slap of hands and shouts of joy match the sound. On television Argentina games merit hours of commentary and dissection with strategic considerations and player decisions receiving the full CNN election treatment of touch finger screens and images dragged in all directions.

In reading about the Cup I’ve comes across a quote from CLR James, a Trinidadian historian of repute, that I particularly enjoy. Motivating his famous autobiography which discusses cricket, Beyond a Boundary, was the question, “What do they know of cricket who only cricket know?” From the inescapably charged discussion surrounding the use of vuvuzelas to the oftentimes enjoyable awkwardness and bad feeling when countries play their former colonial powers (and frequently win), the nasty commentary at some French players after the team’s poor showing to the wincing at a white American’s overdone enthusiasm for the African teams: when the camera cuts to the mugs of politicians and royalty watching their teams play, it’s a reminder that there are not just 22 men on the pitch.

Four geopolitical storylines involving Argentina deserve mention, one already in progress and three to play out. First, the poor showing by European and African squads and the dominance by the Americas, and in particular South America, whose five teams have not yet suffered a loss, seems likely to ignite pressure for reform of the qualifying system and FIFA rankings. Using the grass leaves from the pitch as clues to some larger commentary on national strength is as hackneyed as it often is wrong, but European failures can’t be welcome by politicians back home desperate for some good news during a brutal series of months on the economic front. Second, the emergence of Brazil as a world power and leader in South America has occasioned a noticeable inferiority in Argentina, another reminder of its past economic superiority and the accumulated toll of years of anemic growth. An Argentine victory in the Cup would be enjoyed, but a victory over Brazil particularly so. Third, Argentina and Uruguay have a longstanding dispute over a pulp mill on the Uruguay River. Though less present in the national consciousness, a game against Uruguay would invite reflexive flexing of nationalist muscles in some quarters. Finally, with Presidential elections a year away a fairly strong anti-Kirchner (referring to both the current President Cristina Fernandez and her husband, the former President Nestor Kirchner) mood has taken hold. At a gathering of diplomatic types I was told that some opposed to the pair are privately hoping for an early Argentine defeat to prevent soccer success from propelling the duo back into the Casa Rosada, the seat of the Argentine presidency, amidst a general national mood of good feelings. Though you have to imagine those doing so are not the most devoted of soccer fans.

That cautions one against the geopolitical instinct. Sometimes as Americans know well, it is tough enough just to know cricket. Though it’s difficult to resist imagining some friendly side-betting taking place between leaders at the G20 summit this weekend, when politics seems to intrude on soccer I generally prefer to imagine it the other way around, that soccer and sport intrude on politics, or more precisely, on the human lives that make up our politics. The world now is at play. Let’s enjoy it.

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The Dangers of China’s Recent Housing Price Spike

by Sandy Zhu

China’s housing price just experienced its biggest increase in 14 months: In November 2009, the National Bureau of Statistics (NBS) reported that property prices in 70 Chinese mainland cities rose by an average of 3.9 percent when compared to their price last October. Prices of commercial residences climbed 4.4 percent and high-end housing went up by 1.5 percent.  I think this phenomenon is very interesting—granted, China’s economy wasn’t hit as hard as its American counterpart, but none of its other sectors has  recovered this fast.  What then, are the driving forces behind the recovery of China’s housing market?

I think one thing we have to realize about the housing price situation in China is that housing is a luxury good there. The Chinese populace living in underdeveloped rural areas is not the one that’s out and buying houses. They usually live in family-style houses built by and inherited from older generations. This part of the population still relies heavily on farming, which does not bring enough income for them to “indulge” in property investment.  According to statistics, 16 percent of the houses purchased serve investment and speculation purposes, just below the international alarm rate of 20 per cent. What this signifies to me is the fact that only certain people are buying houses in China, and they are still buying more of it even in today’s economy.

One might wonder how this certain group of people has recovered so fast from the failing economy. Let’s try to decode that by looking at the geographical regions with the largest increase in housing market. We see the sharpest increase in Shanghai, Beijing, and a few other big cities in China. More people are buying houses in these regions, and even more are buying luxurious property (think spacious townhouses in a country where the average person can only afford a room). The large cities mentioned above have the highest concentration of wealthy consumers. Most of them are buying houses now as a form of investment to avoid the risks that are present in the traditional market. Therefore, the increase in housing price in China really doesn’t reflect a revival of housing market: the poor still can’t afford to buy houses and the rich are just indulging as usual.

To me, this gives light to the dangerous widening of income gap in China. As the housing price is being pushed up by the rather unaffected upper-middle class, the lower class, blue collar workers are the ones that are hurt the most. As the Chinese export bubble burst, these workers lost their jobs quickly and have no other means of supporting themselves due to low level of training and education.  For them, houses are more expensive while their checkbooks are thinner.  Instead of buying houses when they get married or expand their families, they will have to resort to renting. I’m really curious to see what will happen next in the renting market in China—regardless, I think that housing markets in China in general are still in a precarious state.

Sandy Zhu is a sophomore Economics & Mathematics major in Jonathan Edwards College.

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The Importance of Being Pink

by Diana Saverin

It’s here: Breast Cancer Awareness Month. Pink ribbons, balloons, signs, and shirts have adorned the streets. Bras hang from the library. We laugh at the ridiculous posters intended to increase our “awareness” of breast cancer: Save the ta tas! Boobies rule, cancer drools! Save second base! Save the boobies! Wear pink on Friday! Everyone loves boobs! A pink ribbon can be found anywhere, thongs, bras, rainboots, perfume, blush, vests, sneakers, yogurt, outerwear, socks, ornaments, mini massagers, book lights, hair straighteners, razors, sink strainers, cookie cutters, Egyptian glass globe bottles, hats, purse hangers, flashlights, and so much more. I am quite certain that if I wished to, I could comfortably live my whole life buying only products with a pink ribbon.

In most ways, this is a great thing. The prominent US-based breast cancer foundations[1] have raised money, awareness, and research enormously. As someone who knows women who have survived breast cancer, I am grateful for these strides that have been made. Moreover, these non-profits provide a model for other causes, as their marketing schemes have worked. They have made an issue, which used to be associated with awkward-to-talk-about breasts, pink. Nowadays, money donated to breast cancer receives more money than any other one topic related to women.[2] Susan G. Komen for the Cure alone has a total expenditure of $347,858,000 a year, which is 27% of the total money spent on all women’s issues annually, ranging from sex trafficking to the compensation gap.[3]

Since giving to the pinkest cause easily translates to the most feminine cause, where do the other pinkish topics stand? These topics include the many subsets under power, human rights, education, economic justice and support, family and work issues, health and women’s bodies, and safety (with breast cancer grouped under health and women’s bodies). So where does the money go? Using the fixed amount of money given to women annually,[4] breast cancer has monopolized the landscape. Out of the over fifty diverse topics and issues related to women,[5] and out of the $1,249,541,000 given to all of those topics in a year, $410,578,000 went to breast cancer, which is 33% of that total. Girls’ education gets 2% of that same pie, work/life balance 0.5%, rape 0.5%, and the compensation gap 0.3%.[6] While I will leave the normative statements of which of these topics deserves the money the most to those wiser than I, I want to understand why breast cancer so dominates the market for women’s philanthropy.

One reason is simple: breast cancer is not considered feminist. The f-word makes the notion that boobs were ever awkward or controversial seem laughable. Supporting one of those feminist groups, like the Feminist Majority or the National Organization for Women, would be riskier, and certainly not very pink. The pink ribbon is losing its spot as the only socially acceptable women’s issue, as it is becoming trendy to talk about empowering girls[7], or giving microloans to women in developing countries[8], but proudly sporting a pink ribbon on a baseball cap or vest remains the classic symbol of political correctness in the minefields of women’s issues and feminism. But by so carefully treading over the dangerous and murky waters of the unlikeable and manly women society has warned us about, do we forget about the one in four women in the US and globally who are raped? Or the sex slavery that kidnaps innocent women and girls and sells and resells their virginity in ways that are sure to make the reader extremely uncomfortable? Or the thousands of women who are brutally killed in the name of honor under sharia law, for heinous crimes, such as wanting to choose their own husband?

Sometimes even more squeamish than these ways women are genitally mutilated and assaulted is their “masculine” ambition. Awkward. Let’s just stick with health, because with health matters it’s life or death, and what could be more important than life? Breast cancer is the best answer: clean cut, depoliticized, pink, whose perpetrators are cells in the depths of our bodies—instead of our own continually discriminating tendencies—and it certainly has some distance from those crazy feminists. But on the note of health, what happens to the women who don’t live long enough to get breast cancer? Or those women who want reproductive freedom, or maternal health care, or who have HIV/Aids? And by the way, isn’t heart disease the number one killer of women, with 1 in 4 women dying from it in the US, while 1 in 30 die from breast cancer?

It gets especially ambiguous for those poor corporations and firms, whose board and leadership statistics[9] reveal in plain sight the continued existence of the glass ceiling.[10] That’s where breast cancer comes in with its pinker than pink pink ribbon that shouts: “See, we love women!” without dealing with all of the dreaded baggage that comes with the f-word. It’s all charity anyways, so it’s all for a good cause, right?

While breast cancer research and awareness does helps 3.3% of the population, imagine if the women around the world who are literally not free, or the girls who are not allowed to go to school because they are forced to perform chores such as walk a total of four hours to get water to boil, or the women subjected to systematical violence got a share of our annual giving. Where would the world be if some of the $410,578,000 currently going to breast cancer addressed the needs of those women? The array of issues related to women’s empowerment and equality is expansive, but in taking pink route and avoiding critical thinking about the state of sexism, society has left those issues alone. We dedicate a whole month to breast cancer awareness, along with 33% of the money we give to women, but resist mustering the strength or resources to learn about the at least fifty other equally important and underfunded issues.

One of these issues is domestic violence, which affects over half of women. It also happens to be domestic violence awareness month. Would it be just too uncomfortable to spread that awareness every October, and knowing that over half of women experience domestic violence in their lifetime, count ten women at our lunch tables, imagining five of their faces as they are assaulted by a family member at some point in their life? Or maybe we’ll just keep taking the shortcut, and stick to blaming tumors and cells; no one wants to see that kind of ugliness on a cupcake in every dining hall or in chalk all over the pavement anyways.

This romance with breast cancer doesn’t expose a love for women’s breasts, or the dire need to find a cure for breast cancer; it reveals the unwillingness to acknowledge the elementary facts of the sexism. It is visible in the 77 cents women make for every dollar a man makes in the US, it is visible because women still do not make up even 25% of Congress, and it is visible in seemingly benign sayings like “you play like a girl.” Sexism exists in all its black and white glory, but breast cancer awareness and funding lets us pat ourselves on the back for helping women without having to deal with creating any systematic change. Maybe pink really is more than a color; it’s our way around thinking about the ways women are treated by others, and not cells, in the home, locally, nationally, and globally.

Diana Saverin is a freshman in Berkeley College.


[1] Susan G. Komen for the Cure, Breast Cancer Research Foundation Breast Cancer Network of Strength, National Breast Cancer Foundation, Mary Kay Ash Charitable Foundation, National Breast Cancer Coalition Fund

[2] Diana Saverin and Mayree Clark. “Mapping the Movement.” Silverleaf Foundation, August 7, 2009.

[3] $45,221,540 of this is spent on fundraising and administrative costs, based on the Susan G. Komen 2007-2008 Annual Report

[4] This amount has increased about 6-7% over the past ten years, based on The Foundation Center’s recent research “Accelerating Change for Women and Girls; The Role of Women’s Funds”

[5] Leadership (political, judicial, corporate, professional, academic), human rights, affirmative action, taxes and inheritance, immigration, refugees, prison, LGBT rights, literacy, support for girls, affirmative action in admissions, title IX, compensation gaps, social security and welfare, minimum wage, women in business, women in non-traditional occupations, aging women, paid family leave, childcare, work/life balance, reproductive rights, mental health, HIV/Aids, Breast cancer, physiological differences between men and women, maternal health, general health, domestic violence, rape, genital mutilation, trafficking, prostitution, violence arising from religious fundamentalism, poverty, peace, coping with conflict, the environment, race, economic policy, the arts, media, science, marketing, PR, and media, financing, government relations, leadership and talent development, technology, research, development, and advocacy

[6] Saverin.

[7] The NIKE foundation, which only gives to girls 10-19 have made “girls” an attractive cause, which has spurred a recent surge in investment in girls. While a meaningful task, it is confusing, because in doing so they distinctly separate the girls we ought to invest in from the women they become and the mothers who raise them.

[8] The success of microloans, which started largely with the Grameen Bank, has been phenomenal, and the research that these loans work best for women because women invest money back into the family has led to poverty alleviation for many women. According to the girleffect.org, women invest 90% of their income into their family, while men invest 30-40%.

[9] While women make up 46.5% of the work force, as of 2008 they make up 3% of Fortune 500 CEOs and 15.2% of Fortune 500 board seats, according to Catalyst’s “Women in Management” October 2008 report.

[10] Refers to sexism in the workplace, that woman can only climb the ladder of leadership before hitting the glass ceiling, and cannot get paid an equal wage for the same job as men.

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