The hardest-hit cities find themselves mired deeply in a downward spiral as cuts in services, rising crime rates and falling property values all contribute to the decline (see graphic: The Recession's Aftermath). "If you can't provide the environment for investment, the process of shrinking just continues," said Jeffrey Keefe, a labor economist at Rutgers University. "The people and businesses leave, and there's no inflow of economic resources. So all you're doing is living off external subsidies to provide law and order and some basic education and social insurance."
"We're not just competing city to suburb anymore," he said. "Our regions are competing globally. But they won't be able to sustain that competitive edge if they're burdened by the legacy of aging infrastructure and pension costs."
That has left many of America's most distressed cities to fend for themselves. "The resources are there; the question is whether they can be reallocated from the communities that have resources to those that don't," said Rutgers' Keefe.How does this article make you think about relationship between the public and private sector?
The U.S. labor force keeps shrinking rapidly. Back in 2007, 66 percent of Americans had a job or were actively seeking work. Today, that number is at 62.8 percent — the lowest level since 1978:
So why does the size of the labor force matter? For one, if people are leaving the labor force for economic reasons (and they're not going back to school), it would mean that the economy is in much worse shape than the official unemployment rate suggests. The jobless rate is officially 7.3 percent, but that only counts people who are actively seeking work — not labor-force dropouts. The size of the labor force also goes a long way to determining America's growth prospects. If, say, Baby Boomers are retiring faster than expected, then long-run U.S. economic growth will be lower than projected. Even worse, if discouraged workers are dropping out of the labor force entirely, they may never make their way back into jobs. Their skills erode over time. Companies don't even bother to look at their resumes. They essentially become unemployable.What are your thoughts on the economic repercussions of this fact? Can and should the government do something about it?
Of course the TPP is not about free trade, in most cases the formal trade barriers between the countries negotiating the pact are relatively low. The main thrust of the negotiations is to impose a regulator[y] structure in a wide range of areas — health, safety, environmental — which will override national and sub-national rules. This has little to do with trade and in some cases, such as the increased patent protection for prescription drugs being pushed as part of the deal (which is noted in the article), will actually involve increased barriers to trade.
Data released this week by Terra-i, a collaborative mapping initiative, shows that deforestation in Ecuador for the first three months of 2013 was pacing more than 300 percent ahead of last year's rate. The report comes shortly after Ecuadorean President Rafael Correa killed off a proposed plan to prohibit oil drilling in Yasuni National Park in exchange for payments equivalent to half the value of the park's unexploited oil reserves.
The failure to attract intergovernmental institutions and governments was effectively a nail in the coffin for the concept, which banked on the desire of Western governments to keep 407 million metric tons of carbon dioxide out of the atmosphere while protecting an area of forest that scientists say may be the richest in the Amazon. The biggest setback came in June 2011 when Germany pulled out of a $50 million commitment to the program. Since then, progress on the initiative has largely stalled. Chief stumbling blocks were concerns over how Ecuador would use the funds generated under the initiative, risk of political instability, and whether Correa would abide by his promises. According to U.N. data, Ecuador had one of the highest rates of deforestation in South America during the 2000's, losing 1.8 percent of its forest cover annually.Tanzi talked about global public goods and the urgency for international governments to cooperate. This failed initiative was one such attempt in recent memory. How ready do you think governments around the world are to work together for the greater good of the world and do you think it is in their interest to do so any time soon? I suspect that even if they do such a thing, any "solution" they agree on is likely to create other problems in the future.
