Watching America’s leaders scramble in the closing days of 2012 to avoid a “fiscal cliff” that would plunge the economy into recession was yet another illustration of an inconvenient truth: messy politics remains a major driver of economic developments.
In some cases during 2012, politics was a force for good: consider Prime Minister Mario Monti’s ability to pull Italy back from the brink of financial turmoil. But, in other cases, like Greece, political dysfunction aggravated economic problems.
Close and defining linkages between politics and economics are likely to persist in 2013. Having said this, we should also expect much greater segmentation in terms of impact – and that the consequences will affect both individual countries and the global system as a whole.
In some countries – for example, Italy, Japan, and the United States – politics will remain the primary driver of economic-policy approaches. But elsewhere – China, Egypt, Germany, and Greece come to mind – the reverse will be true, with economics becoming a key determinant of political outcomes.
This duality in causation speaks to a world that will become more heterogeneous in 2013 – and in at least two ways: it will lack unifying political themes, and it will be subject to multi-speed growth and financial dynamics that imply a range of possible scenarios for multilateral policy interactions…
How politics and economics interact nationally and globally is one of the important questions for 2013 and beyond. There are three scenarios: good economics and effective politics provide the basis for a growing and more cooperative global economy; bad economics interact with dysfunctional politics to ruin the day; or the world muddles through, increasingly unstable, as a tug of war between economics and politics plays out, with no clear result or direction.
Part of the answer depends on what happens in three countries in particular – China, Germany, and the US. Their economic and political stability is essential to the well-being of a world economy that has yet to recover fully from the 2008 global financial crisis.
Current indications, albeit incomplete, suggest that the three will continue to anchor the global economy in 2013. That is the good news. The bad news is that their anchor may remain both tentative and insufficient to restore the level of growth and financial stability to which billions of people aspire.
Mohamed El-Erian pretty much speaks in moderate terms even when discussing immoderate and opportunist politicians. He’s a nice guy. Even for a NY Jets fan.
He’s worth listening to if for nothing else his experience within and without the boundaries of international economics. Between the IMF and PIMCO, politicians stand in line asking him to run for elective office. But, then, he’d have to spend even more time with politicians. Most of whom – I’m afraid – aren’t any better than the hyenas we have in Congress.
Switzerland is the best country for a baby to be born in 2013, according to a new study by the Economist Intelligence Unit, which is based on both subjective and objective quality of life factors.
The variables include life expectancy, gender equality, political freedoms, and even climate, but because the study looks at where “to be born” not “where to live,” some of the factors look at what life will be like in those countries in 2030, when children born in 2013 reach adulthood.
Rounding out the top 10 are:
7. New Zealand
10. Hong Kong
The report authors write:
Being rich helps more than anything else, but it is not all that counts; things like crime, trust in public institutions and the health of family life matter too. In all, the index takes 11 statistically significant indicators into account.
The United States didn’t crack the top 10 this year, because American “babies will inherit the large debts of the boomer generation,” the researchers write. Could have included mediocre education, crumbling infrastructure in that same sentence.
In the 1988 survey, the United States came in first, followed closely by mostly European countries and several high-performing Asian ones, such as South Korea and Japan…
Now, Japan and South Korea rank 25 and 19, respectively, perhaps because their economies have become more troubled in recent years.
Europe has also slipped in the rankings because the ongoing euro-zone crisis there has caused severe unemployment and “eroded both family and community life,” the authors write…Germany has dropped to 16 – a tie with the United States.
Disagree with the list? The full methodology can be found here.
The Economist is a magazine grounded in conservative economics. That’s conservative in the traditional sense, rather like the term used to be in the United States before today’s Republican Party started their outreach policy for governance by homophobes, religious nutballs, various and sundry bigots.
So, the list will be accused of being part of a mythic liberal conspiracy – regardless of credentials.
General Motors has released details of its pending pure electric vehicle, the Chevrolet Spark EV.
The electric car will be based on the small gas-engine Spark already offered. Its propulsion will delivered by an oil-cooled, permanent magnet motor that produces at least 100 kilowatts (130 horsepower) and instantaneous torque of about 400 pound-feet with the coaxial drive unit.
GM says the resulting acceleration for the 0-60 mph sprint will take less than eight seconds.
The Spark EV will come with an industry-first, a SAE combo charger. This will allow DC fast charging of up to 80 percent of battery capacity in approximately 20 minutes.
That capability will be available shortly after market launch, GM says, adding it will assist with effective daily EV range…
The Spark EV’s more than 20-kwh lithium-ion battery pack will be protected by Chevrolet’s eight year/100,000 mile warranty, and is said by GM to be capable of handling multiple DC fast charges daily.
Charging will also be possible in less than seven hours using a dedicated 240-volt charger. A 120-volt charge cord set will be standard.
Owners will be able to manage and monitor charging remotely using the Spark EV’s smart phone application, provided by OnStar…
Price is the kicker. Typical range for any small [or smallish] EV is 60-70 miles. That’s almost 3 days worth of commuting for my wife. Our weekend grocery shopping/errands fits, too. If the critter comes in at or below $20K – we’re first in line for Santa Fe County.