Author Archives: emilykawano

Econ-Atrocity {special History of Thought series} Henry George’s “Single Tax”

(4/21/04)
By Alanna Hartzok, Co-Director, Earth Rights Institute

One day, while riding horseback in the Oakland hills, merchant seaman and journalist Henry George had a startling epiphany. He realized that speculation and private profiteering in the gifts of nature were the root causes of the unjust distribution of wealth. The insights presented in Progress and Poverty, George’s masterwork, launched him to fame. His policy approach was known at that time as the “single tax” – meaning that taxation should be shifted off of labor and onto the socially created surplus value of land and other natural resources. His message reached as far as the great Russian Leo Tolstoy, who was so taken with the idea that he frequently referred to George and “Georgism” in his novel Resurrection.

During the last 20 years of the 19th century George built an impressive populist movement bent on solving the problem of the wealth gap, and he died in 1897 while campaigning to be New York’s mayor. The “Georgists” were determined to free labor and all productive effort from the burden of taxation. Land and natural resources were gifts of nature to be fairly shared by all. The role of government would be to secure democratic rights to the earth for all people via the collection of resource rents, the surplus value accruing to natural wealth, which would be distributed in social goods, services or by direct citizen dividends.

But just as this solution to the rich/poor gap was gaining momentum, the Georgist movement was stopped in its tracks. Wealthy individuals poured their money into leading schools of economics to encourage the writing of treatises against George and the movements he had spawned. The ethical perspective that land is a common heritage and the policy approach of land value taxation were subsequently eliminated from the field of economics. The newly dominant theory focused on only two primary factors – labor and capital – with capital having the upper hand as “employing labor.” “Labor,” of course, is quite capable of self-employment given access to land. This is what the elites and the plutocrats feared most – that labor would gain full power to directly produce capital given conditions of equal rights to the resources of the earth.

Despite the elites’ success in mangling the science of political economy, the Georgist paradigm has had some influence over the years. The 1887 Wright Act in California enabled bonds raised by local irrigation districts to be paid from the increase in land values, resulting in a powerful and beneficial land reform, though this equitable and successful public finance approach was eventually undermined by private banking institutions. Now taxpayers nationwide subsidize the irrigation needs of agribusiness. Alaska’s state constitution vests the ownership of oil and other natural resources in the people as a whole and the state’s Permanent Fund distributes substantial oil revenue as citizen dividends to state residents. With no state income or sales taxes, Alaska has been the only state where the wealth gap has decreased during the past decade. This is essentially a Georgist paradigm approach, and surface land values and electromagnetic spectrum rent could be similar sources for citizen dividends.

Meanwhile, Georgist economics is again making steady progress. In Pennsylvania, eighteen municipalities, including Harrisburg and Allentown, have been revitalizing their local economies via property tax reform which shifts taxes off of homes and the built environment and onto the value of land sites. Movements for land value taxation are growing now in Scotland, UK, Ireland, South Korea and elsewhere, while Venezuela, Russia and other countries are pushing for greater resource rents from oil and mineral resources. Georgist economics is increasingly recognized as a key to economic democracy based on equal rights to the earth for all.

Recommended:

Mason Gaffney, Fred Harrison and Kris Feder, The Corruption of Economics. Shepheard-Walwyn Ltd., 1994.

Henry George’s books can now be read online. Hardcopies of his books, and those of other Georgist authors, can be ordered from The Robert
Schalkenbach Foundation
(212-683-6424).

J.W. Smith, Economic Democracy: The Political Struggle of the Twenty-First Century. This excellent Georgist paradigm book can be ordered from The Institute for Economic Democracy (866-588-7445).

Kenneth C. Wenzer, ed. Land Value Taxation. M.E. Sharpe, 1999.

Georgist paradigm articles and links to other sites: Earth Rights Institute.

The Council of Georgist Organizations 2004 conference will be held in Albuquerque, New Mexico, July 21 – 25. For details: www.progress.org/cgo.

The International Union for Land Value Taxation conference is scheduled for May 27 – 30 in Madrid, Spain. For details: www.interunion.org.uk/.

Leo Tolstoy’s novel Resurrection can be read online.

(c) 2004 Center for Popular Economics

Econ-Atrocities are a periodic publication of the Center for Popular Economics. They are the work of their authors and reflect their author’s opinions and analyses. CPE does not necessarily endorse any particular idea expressed in these articles.

Econ-Atrocity {special History of Thought series} C.L.R. James: The Future in the Present

By Geert Dhondt, Staff Economist

Madness surrounds all of us. Luckily the world is full of contradictions. While capitalism, barbarism and madness might seem all around us, so is its opposite, its negation. Thus, if we look hard enough we can recognize the new society in the present and we will be able to see the emergence of revolutionary possibilities. In the U.S., C.L.R. James was one of the first to clearly articulate the importance of independent Black struggles in creating these openings.

C.L.R. James was born in 1901 in Trinidad. In 1932 he left Trinidad for England where he immersed himself in the Pan-African and Trotskyist movements and worked as a cricket reporter. In 1938, on Trotsky’s request, he came to the U.S. to reinvigorate the American Trotskyist movement. By the time James was deported in 1952, he had broken with Trotsky’s conception of the Soviet Union as a degenerated workers’ state and developed instead a critique of state capitalism; he had broken with Lenin’s conception of the vanguard party and emphasized a different role for Marxist organizations and intellectuals; he also developed an important analysis of the role of independent Black struggle. Read more

Econ-Atrocity {special History of Thought series} Resurrecting the Radical Keynes

By Jim Crotty, CPE Staff Economist

The Keynesian economics that Paul Samuelson popularized in the United States after World War II was a sanitized version of the radical critique of capitalism offered by Keynes himself. John Maynard Keynes’s deep-seated attack on free-market economics led him to call for direct government control of the lion’s share of investment spending, industrial policy, a confiscatory wealth tax, strict control over cross-border financial flows and managed trade. But US “Keynesians” defanged his attack, arguing that if the government regulated interest rates and budget deficits, all other decisions could be left to market forces.

In the aftermath of World War I, the British economy experienced sluggish growth and high unemployment until war preparations began in the late 1930s. The conventional analysis of the time was that high unemployment was caused by high wages that priced British products out of the global markets they traditionally dominated. The conventional solution was to smash the
strong unions in these industries.

Keynes argued that the correct policy was for the government to initiate a large long-term program of government infrastructural investment. This would reduce unemployment not only through government employment, but also by the spending of the newly employed – the famous Keynesian “multiplier” effect that has puzzled generations of students. Focus on large-scale government investment was not just a post-war expedient for Keynes. He supported this policy until his death in 1946.

Keynes believed that free-market capitalism was subject to extreme instability primarily because business investment spending was inherently volatile. To build a factory, a firm must gamble that the future profits from the factory will more than compensate for its cost. But firms cannot know what future profits will be. As Keynes put it, “About such matters, we simply do not know.” Therefore, investment can only be based on hunches or guesses about the future, and these are profoundly influenced by waves of optimism and pessimism in market psychology. Boom euphoria leads to over-investment and excess capacity, while fear of loss in the downswing causes investment to plummet. Keynes considered stock markets to be “gambling casinos” whose instability only made investment more volatile.

Keynes thought that there were almost unlimited opportunities for productive state investment – in education, housing, transportation, utilities, health, culture and so forth. He believed that if the government could keep public investment on a steady growth path, this would provide a center of gravity for private profit expectations that would drastically lower private investment instability. In 1928, he proposed a “National Investment Board” to plan and control a massive investment program, arguing that “an era of rapid progress in equipping the country with all the
material adjuncts of modern civilization might be inaugurated which would rival the great Railway Age of the nineteenth century.”

In 1935 in The General Theory he said: “I expect to see the state … taking an ever greater responsibility for directly organizing investment.” In 1943 he argued that “if the bulk of investment is under public or semi-public control and we go in for a stable long-term programme, serious fluctuations are less likely to occur.” Keynes specifically rejected the idea that government should rely on changing interest rates and budget deficits to control instability, the macro policy attributed to him by Samuelson.

Keynes understood that capitalists and renters would be likely to ‘run away’ from Britain in reaction against his program, causing skyrocketing interest rates and plummeting investment. To prevent this, he called for an ironclad regime of government control of financial flows into and out of Britain, and saw to it that every country was given the right to control capital movements by the Bretton Woods Agreement that created the International Monetary Fund in 1944.

The economic prospects of the majority of people would be greatly improved if government policy followed Keynes’ more radical vision, rather than the timid version promoted in nearly all college textbooks.

Reference:

Jim Crotty. “Was Keynes a Corporatist: Keynes’s Radical Views on Industrial Policy and Macro Policy in the 1920s,” Journal of Economic Issues, September 1999. [pdf]

Keynes’ most famous book, The General Theory of Employment, Interest, and Money, is available online.

(c) 2004 Center for Popular Economics

Econ-Atrocities are a periodic publication of the Center for Popular Economics. They are the work of their authors and reflect their author’s opinions and analyses. CPE does not necessarily endorse any particular idea expressed in these articles.

Econ-Atrocity {special History of Thought series} Leon Trotsky, Theorist and Revolutionary

By Alejandro Reuss

Mention the name of Leon Trotsky and you might be asked, “Didn’t he have an affair with Frida Kahlo?” (He did.) Or, “Wasn’t he murdered with an ice pick?” (He was.)

He was also, however, known to dabble in revolutionary politics.

The triumph of Stalin and his falsification of history have obscured Trotsky’s importance, writing him out of the Russian Revolution and airbrushing him from photos of the era (especially those showing him with Lenin). Trotsky was a principal leader of the workers’ council, or soviet, movement in Petrograd (St. Petersburg) during the revolutions of 1905 and 1917, the main strategist of the October 1917 insurrection and the principal architect of the Red Army, Lenin’s most prominent lieutenant until the latter’s death in 1924, and a leading opponent of Stalin’s rise to dictatorial power. In short, he was one of the major figures of the 20th century.

Trotsky is mainly known for his thought on two key issues: the possibility of socialist revolution in “backward” Russia, and the rise of the bureaucratic dictatorship led by Stalin. Trotsky did not just apply Marxist theory by rote, but added new and “heretical” ideas needed to explain new phenomena. His balance sheet on the 1905 revolution, Results and Prospects (1906), argued that Russia’s leaps-and-bounds industrialization had set the stage for a revolution in which the proletariat – rather than the bourgeoisie – would be the protagonist. He would be vindicated by the October Revolution of 1917.

His masterpiece, The Revolution Betrayed (1936), presented a withering critique of the Soviet bureaucracy. In the long run, Trotsky argued, either the working class would overthrow the bureaucracy and clear the way for renewed progress toward socialism or the bureaucracy would formalize its privileges by reinstituting private property and restoring capitalism outright. Trotsky did not imagine that the system of bureaucratic rule would last another half century, but of course, he was eventually vindicated on this point as well.

Exiled from Russia in 1929, Trotsky lost the power and prestige of high position in a revolutionary government, and his efforts to build a new world party of socialist revolution (the “Fourth International”) could offer little to rival the rising tide of reaction worldwide. Nonetheless,
he considered this “the most important work of my life – more important than 1917, more important than the Civil War.”

In the founding program of the Fourth International, known as the Transitional Program for Socialist Revolution (1938), Trotsky emphasized that while mass struggles continued to rage, they were not imbued with the perspective of overturning capitalism and creating a new society. He argued, therefore, that the central task for revolutionaries was to build “bridges” from current consciousness to revolutionary politics. This did not mean, in Trotsky’s view, repeating radical-sounding slogans from the past, postponing revolutionary aims in favor of immediately “winnable” struggles, or pining for a reformed version of capitalism. Rather, it meant that revolutionaries must frame their positions on the burning issues of the day in a way that connected these issues to the aim of revolution.

Trotsky’s life and politics ought to be viewed critically, especially in light of his role (with Lenin and the Bolsheviks in general) in building a state machine that would grow into a totalitarian juggernaut. Ideas like those in the Transitional Program, however, should be put to work in the
present whatever we conclude about the author’s past. Trotsky was not the only, or even the first, theorist to insist on drawing the connections from every immediate issue to the fundamental problems of capitalist society. I learned this lesson from the writings of Trotsky and from his disciples. Today’s revolutionaries need not learn this from Trotsky as well – but those who do not learn it from him should make sure to learn it from someone else.

Further reading by and about Trotsky:

Two good short introductions to Trotsky’s life and thought are:
Phil Evans and Tariq Ali, Introducing Trotsky and Marxism, Icon Books, 2000.
Ernest Mandel, Trotsky as Alternative, New Left Books, 1995.

The following are Trotsky’s most important books (all published by Pathfinder Press):
The History of the Russian Revolution.
My Life: An Attempt at an Autobiography.
The Permanent Revolution and Results and Prospects.
The Revolution Betrayed: What Is the Soviet Union and Where Is It Going?
The Transitional Program for Socialist Revolution.

For an excellent collection of these and other writings online, see The Leon Trotsky Internet Archive.

Isaac Deutcher’s monumental three-volume biography of Trotsky (Oxford University Press, 1970) is the definitive work on the subject:
The Prophet Armed – Trotsky: 1879-1921
The Prophet Unarmed – Trotsky: 1921-1929
The Prophet Outcast – Trotsky: 1929-1940

(c) 2004 Center for Popular Economics

Econ-Atrocities are a periodic publication of the Center for Popular Economics. They are the work of their authors and reflect their author’s opinions and analyses. CPE does not necessarily endorse any particular idea expressed in these articles.

Econ-Atrocity {special History of Thought series} Y.C. James Yen and His Rural Reconstruction Movement

By Zhaochang Peng

Y.C. James Yen (1893-1990), a Chinese educator and social activist, developed a fourfold “rural reconstruction” approach to rural development in China during the 1920s. A resurgence of interest in his approach to development is currently underway in China, while his work has been continuously promoted by the institute he established in the Philippines in 1960.

James Yen’s Rural Reconstruction Movement promotes an integrated program of education, livelihood, public health and self-governance, which targets the interlocking problems of illiteracy, poverty, disease and civic inertia found among peasants in developing countries. While the four aspects of the program could be designed to address the problems in a one-for-one way, James Yen intended them to be an organic whole, to be carried out in close cooperation with one another.

Yen’s first experimental project, which began in 1926, was in rural Ding Xian (in China’s Hebei Province). With the help of external funds and volunteers, the reconstruction unfolded over a ten-year span. In the first three years, illiteracy was eliminated; for the next three years, more productive farming methods were disseminated and the local public health system was established; and finally, on the basis of the cultural, economic and social improvements already achieved, peasants were able to set up a local system of self-governance. The results of this experiment were positive and encouraging, and had begun to impact other parts of China.

From 1950 till his death in 1990, James Yen devoted his life to adaptation of this approach to peasant communities in developing countries in Asia, Africa and Latin America. His lifetime pursuit of the betterment of the life of peasants in developing countries won him world reputation and numerous awards, including the Copernican Citation as one of ten outstanding “modern revolutionaries” of the world together with Albert Einstein, Henry Ford, John Dewey and others in 1943, and the U.S. Presidential End Hunger Award for Lifetime Achievement in 1987.

However, there is one major limitation inherent in James Yen’s Rural Reconstruction method: its local approach relies on the prevailing political, economic and social relationships that already exist, rather than transforming them. For example, it provides aids to peasants, and to
some extent even organizes local peasants into cooperatives in order to make them more competitive in the market, but it does not attempt to abolish market forces, thus keeping rural economy in a structurally disadvantageous position to be subject to unfavorable market vicissitudes. Another example is that the “experiment sites” of James Yen’s approach are restricted to peasant communities dominated by self-employed households. Thus, in rural localities where feudal landlords and capitalists exploit poor peasants, problems of underdevelopment for those poor peasants persist.

In contrast to James Yen’s “rural reconstruction” approach, Mao Zedong’s “rural revolution” approach provides a better solution to rural development issues in developing countries. Under Mao’s leadership, feudal and capitalist forms of peasant exploitation were abolished through land reform, peasants were organized into cooperatives through guided and voluntary rural collectivization, and the rural economy got extensive aids from the state in a planned economy context where market forces were limited or completely eliminated.

In the past quarter century, the return of the market economy to China, the degeneration of the state into a predator on peasants, and the increasing integration of China with the capitalist world economy have subjected Chinese peasants to higher market risks and exploitation rates. In this context, an increasing number of Chinese social activists and expert volunteers are getting involved in reviving James Yen’s approach, with the hope that organized peasants will be less vulnerable to market risk and state coercion. Although it may still be some years before we can assess the influence of the revival of James Yen’s approach on Chinese peasants, we know from historical experience that there is a better solution to problems of rural development.

Sources and Resources:

The International Institute of Rural Reconstruction

James Yen’s biography by the Magsaysay Award

The Hunger Project’s brief comments on James Yen

“James Yen-inspired new Rural Reconstruction Movement in China” (in Chinese)

(c) 2004 Center for Popular Economics

Econ-Atrocities are a periodic publication of the Center for Popular Economics. They are the work of their authors and reflect their author’s opinions and analyses. CPE does not necessarily endorse any particular idea expressed in these articles.

Econ-Atrocity {special History of Thought series} Prince Kropotkin

By Suresh Naidu, CPE Staff Economist

Piotr Kropotkin is famous within two groups that one never sees at the same party. The biologists and evolutionary anthropologists who derive inspiration from Kropotkin’s research into the evolution of human sociality rarely intersect with the anarchists and political theorists who respect Kropotkin’s views on revolutionary change and the abolition of the state and private property. However, there was no disparity for Kropotkin, who derived many of his political beliefs from his studies of human and animal evolution.

Kropotkin had a long and interesting life. Born in 1842 to Russian nobility, he began his career as an exemplar of his class, serving in the military during the Crimean War, but eventually wound up working with the revolutionary Jura Federation. His politicization followed lengthy and difficult travels, during which he developed a deep affinity for the Russian peasants and workers he encountered. Later cut off from any political influence by Lenin, Kropotkin’s last writings were notable predictions of the tyranny that would result from the Bolshevik retention of wage labor and reliance on state coercion.

A large portion of contemporary social and biological science follows in the footsteps of Kropotkin’s academic work. Responding to the social Darwinism of his day, he wrote his primary scientific work, Mutual Aid: A Factor of Evolution, arguing that a major factor in the evolutionary success of humans was a predisposition to cooperate and share, without the need for institutions such as the market or the state.

Modern day research has provided overwhelming evidence to corroborate Kropotkin’s thesis. Anthropologists and archaeologists have found widespread decentralized cooperation within many non-industrial societies. Experimental economists have definitively shown that people are not classically selfish, with people often giving away substantial amounts of money and actively cooperating in laboratory settings, even against their narrow self-interest. This is not merely “enlightened self-interest,” rather a deeply seated desire for fairness as an end in itself (this desire may or may not have roots in biology). Biologists have acknowledged that competition among early human groups could have contributed to the evolution of cooperative behavior on the part of individuals.

Much of this literature has paralleled Kropotkin in refuting a naive socio-biological theory of human behavior. Rather than concocting stories that rationalize the current order in terms of fitness, it points to potential ways of organizing human interactions that can replace the dominant institutions of our day with something more democratic and egalitarian. Kropotkin built his belief in anarchism on the knowledge that people can organize their lives without self-interest or governmental coercion as prerequisites for large-scale cooperation.

There are many current examples of such cooperation. Elinor Ostrom and colleagues are documenting community management of scarce resources and public goods provision without the aid of governments or market pricing systems. Steve Lansing examines how Balinese rice farmers coordinate their complex ecological interactions with a few simple rules. Yochai Benkler identifies Open-Source Software as an example of large-scale non-market, non-state coordination. Erik Olin Wright and others study how participatory directly democratic institutions function to solve practical problems from Kerala to Chicago. Human institutions that harness the natural propensity to cooperate (and sometimes punish those who do not) are quite pervasive.

The political implications Kropotkin drew from his work are not the ravings of a lunatic egghead. Anarchism is commonly caricatured as naive, or worse, a haven for would-be terrorists. Instead, the politics advocated by Kropotkin are best interpreted as general principles. First is an ethical imperative, that there is no policy substitute for social norms and ideals of behavior – a belief that one’s personal behavior can either reinforce or undermine the status quo. The second is a deep suspicion of facile state or market fixes to social problems. Together, these imply respecting and considering people’s abilities to develop community solutions and autonomously self-organize before suggesting “policy” or “market” solutions. Kropotkin’s mix of science and politics are not vestiges of a bygone age, but very relevant ideas deserving greater intellectual and political engagement.

References:

Stephen Jay Gould, “Kropotkin Was No Crackpot,” Natural History, July 1997.

For experimental fairness, see Ernst Fehr et. al., “Fairness and Retaliation: The Economics of Reciprocity,” Journal of Economic Perspectives, Summer 2000.

For group selection giving rise to cooperation, see Elliott Sober and David Sloan Wilson, Unto Others, Harvard University Press, 1998.

For egalitarian cooperation in hunter-gatherers, see Christopher Boehm, Hierarchy in the Forest, Harvard University Press, 1999.

The remarkable case of Balinese rice farming is found in Steven Lansing and John Miller, “Cooperation in Balinese Rice Farming.”

For community solutions to public goods problems, see Elinor Ostrom’s classic Governing the Commons, Cambridge University Press, 1990 and Trust and Reciprocity, Russell Sage Foundation, 2003.

For Open-Source Software, see Yochai Benkler, “Coase’s Penguin, or Linux and the Nature of the Firm,” 112 Yale Law Journal 369 (2002).

For the efficacy of direct democracy, see Erik Olin Wright and Archon Fung, Deepening Democracy, Verso, 2003.

(c) 2004 Center for Popular Economics

Econ-Atrocities are a periodic publication of the Center for Popular Economics. They are the work of their authors and reflect their author’s opinions and analyses. CPE does not necessarily endorse any particular idea expressed in these articles.

Econ-Atrocity {special History of Thought series} Richard Ely and Aristotelean Economics

By Gerald Friedman, Professor of Economics, University of Massachusetts, Amherst

The strength of conservative economics comes from methodological individualism. By treating economic outcomes as the product of individual choice subject to constraint, conservatives treat all social interference, either by government or by concentrations of private power, as illegitimate interference with individuals’ choices. Any reformist economics must begin by challenging this individualist premise.

Beginning in the 1880s, Richard Ely (1854-1943) articulated a different vision for a reformist economics built on Aristotle’s dicta that man “was formed for society.” Ely led a group of younger economists who founded the American Economic Association in 1885 to promote economics as a social science, uniting labor, scholarship, and the church to advance social reform. Ely declared that the “younger political economy no longer permits the science to be used as a tool in the hands of the greedy and the avaricious for keeping down and oppressing the laboring classes. It does not acknowledge laissez faire as an excuse for doing nothing while people starve.” Read more

Econ-Atrocity {special History of Thought series} Small Is Beautiful: An Introduction to E. F. Schumacher

By Noah Enelow

Few economists of the last fifty years have offered more striking alternatives to mainstream economic thinking than Ernest Friedrich Schumacher. Born in Germany but spending the bulk of his working life in England, Schumacher’s career afforded him the ability to critique the economic system from within, and propose alternatives – not primarily through policy prescriptions, but through a radically different attitude towards life. He spent twenty years as the Chief Economic Advisor to the National Coal Board of Britain, and through that organization became intimately acquainted with problems of energy supply and environmental sustainability. Meanwhile, his interest in gardening, his study of Buddhist and Taoist thought, and his admiration for the work and philosophy of Gandhi led him to expand his economic thinking towards a wider set of values that he called “meta-economic.”

Several of Schumacher’s ideas are particularly relevant to contemporary economic life. Perhaps the foremost among these is the idea of decentralization. Schumacher’s idea of decentralization is more complex than simply breaking up a larger unit into smaller units. Rather, Schumacher proposed the idea of “smallness within bigness”; in other words, for a large organization to work it must behave like a related group of small organizations. In discussing economic development and poverty alleviation, this philosophy prescribes an orientation toward “regional” development strategies, which involve primarily local production for local use. In the era of globalization, this philosophy entails a radical rethinking of the orientation towards exports so often prescribed by international economic institutions.

Schumacher’s most radical break with the mainstream of economic thought, however, comes with his willingness to sacrifice economic growth – for so long the Holy Grail of economic policy and strategy – for a more fulfilling working life. Perhaps more than any economist since Karl Marx, Schumacher called attention to the quality of people’s lives as producers, even stressing its importance over their lives as consumers. Work, rather than being, as in neoclassical theory, a “disutility,” becomes in Schumacher’s philosophy a means towards satisfaction, fulfillment, and personal development.

In order to bring about these more fulfilling working lives, Schumacher proposes a radically different relationship between human beings and technology. The purpose of technology up until this point, he argues, has been to produce as much output per labor input as possible. The devices invented for this purpose, however, have not only served the dubious end of making many workers redundant, but their prohibitively high cost discourages self-employment. As a solution, Schumacher proposes an “intermediate technology,” one which can be easily purchased and used by poor people, and which can lead to greater productivity while minimizing social dislocation. Today, the Intermediate Technology Development Group works with agriculturists, food producers, small miners, and small manufacturers throughout the world to develop these tools.

Schumacher’s ideas have taken root in multiple forms and remain an ongoing and vital part of the discourse of economics. The E. F. Schumacher Society, in Great Barrington, Massachusetts, is the foremost center for the spread of Schumacher’s ideas in the United States. Founded in 1980 by a group of Schumacher’s friends and students, the Society contains a vast library of Schumacher’s works and a repository for communities currently putting his ideas into practice. The Society’s three top priorities are to stimulate the production of local currencies, to promote affordable access to and sustainable use of land through community land trusts, and to encourage and provide assistance to worker ownership and management of firms. Visit the website below to learn more.

Sources and Resources:

Schumacher, E. F. Small Is Beautiful: Economics As If People Mattered. New York: Harper and Row, 1973.

E. F. Schumacher Society. Special thanks go to Susan Witt, Executive Director of the E. F. Schumacher Society, for her assistance on this essay.

Intermediate Technology Development Group.

(c) 2004 Center for Popular Economics

Econ-Atrocities are a periodic publication of the Center for Popular Economics. They are the work of their authors and reflect their author’s opinions and analyses. CPE does not necessarily endorse any particular idea expressed in these articles.

Econ-Atrocity: The Scourge of Child Labor

By Sevinc Rende, UMass Amherst Department of Economics

Child labor was once considered a problem of the past, but with 186 million children working as laborers across the world, it is very much a problem of today. Activists, the media, academics, and those discussing labor standards in international institutions have all played a part in creating awareness around this issue.

Around 110 million of child laborers – almost 60% – are under the age of twelve. More than half of all child laborers work with hazardous chemicals or in confined spaces. The Asia-Pacific region harbors the most child laborers in terms of absolute numbers, but the sub-Saharan Africa has the highest percentage of its children at work. Yet, if 129 nations have agreed to the elimination of child labor, why is child labor so widespread? What do we actually know about these children and their economic circumstances? As a result of decade long research and data collection, today we can outline broadly what we know about the world’s child laborers.
Read more

Econ-Atrocity: Global Poaching–Jamaica’s Brain Drain

By Brenda Wyss, CPE Staff Economist

Jamaica is hemorrhaging nurses and teachers. The Jamaica Gleaner reports that Jamaica loses roughly 8% of its RNs and more than 20% of its specialist nurses annually. Most go to the US or the UK. The US, with 97.2 nurses per 10,000 people, actively recruits nurses from Jamaica, a country with only 11.3 nurses per 10,000 people. Meanwhile, US and British schoolteacher work programs recruit Jamaican teachers for inner city schools in New York City and London. In 2001 alone, 3% of Jamaica’s teachers (almost 500 educators) left the island to accept temporary assignments abroad. Jamaica’s Ministry of Education estimates the country
lost 2,000 teachers between 2000 and 2002. And Jamaica’s brain drain is not limited to nurses and teachers. In fact, an IMF report estimates that more than 60% of all Jamaicans with tertiary education have migrated to the US.

Jamaica’s chronically under-resourced health and education sectors can ill afford the loss of skill. In its 2001 Annual Report, Jamaica’s Ministry of Health reported nationwide vacancy rates of 37% for RN positions, 28% for public health nurses, 17% for nurse practitioners, and 61% for assistant nurses. At the same time, a shortage of trained teachers threatens educational quality. While Jamaica has trained increasing numbers of teachers over the years, the fraction of teachers serving in Jamaica’s schools who are fully trained has declined. Between the 1990-91 and 1996-97 school years, the total share of trained teachers decreased by 11%.
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