BEYOND THE WASHINGTON CONSENSUS The Future of Hemispheric Integration

BEYOND THE WASHINGTON CONSENSUS: The Future of Hemispheric Integration BEYOND THE WASHINGTON CONSENSUS: The Future of Hemispheric Integration Who are these guys and what do they want? Who are these guys and what do they want? The same thing James Madison wanted… Who are these guys and what do they want? Evo Morales is the President of Bolivia and the former the leader of Bolivia's cocalero movement – a loose federation of coca leafgrowing campesinos who are resisting the efforts of the United States government to eradicate coca in the province of Chapare in southeastern Bolivia. Morales is also leader of the Movement for Socialism political party (Movimiento al Socialismo, with the Spanish acronym MAS, meaning "more"), which was involved in the recent Gas Wars, along with many other groups, commonly referred to as 'social movements' The same thing James Madison wanted… The Future of Hemispheric Integration The Future of Hemispheric Integration The Future of Hemispheric Integration “Our country knows that the 21st century will have moved beyond the divisions between poor and rich nations. The world will instead be divided between peoples condemned to cultural colonization and peoples who control technologies. No one should expect Brazil, with all its riches with its potential, with its determination, to be a second rate country.” Jose Sarney, President of Brazil 1986 Foreign Affairs p.117 The Future of Hemispheric Integration T The Future of Hemispheric Integration European Union 1951 1957 1992 1997 1999 2007 Coal and Steel Community Treaty of Rome (EEC) European Union Treaty Treaty of Amsterdam Euro Launched Still struggling with members 2007-1993=14 2007-1951= 56 The Future of Hemispheric Integration Third time’s the charm? 1) Export led growth 2) Import Substitution Industrialization 3) Economic Integration The Future of Hemispheric Integration The Future of Hemispheric Integration The Future of Hemispheric Integration Economists Opine… How to promote the general welfare? Economists Opine… How to promote the general welfare? What really matters? Per capita income Two Guys Opinions… K= Capital Stock Two Guys Opinions… K= Capital Stock Q = Output Two Guys Opinions… K= Capital Stock Q = Output K/Q= Capital Output Ratio Two Guys Opinions… K= Capital Stock Q = Output K/Q= Capital Output Ratio C = Consumption Two Guys Opinions… K= Capital Stock Q = Output K/Q= Capital Output Ratio C = Consumption S = Savings Two Guys Opinions… K= Capital Stock Q = Output K/Q= Capital Output Ratio C = Consumption S = Savings P = Population Two Guys Opinions… K= Capital Stock Q = Output K/Q= Capital Output Ratio C = Consumption S = Savings P = Population Q/P = Per Capita Income Two Guys Opinions… K= Capital Stock Q = Output K/Q= Capital Output Ratio C = Consumption S = Savings P = Population Q/P = Per Capita Income Savings Rate = 20% Two Guys Opinions… K= Capital Stock Q = Output K/Q= Capital Output Ratio C = Consumption S = Savings P = Population Q/P = Per Capita Income Savings Rate = 20% Consumption Rate = 80% Two Guys Opinions… K= Capital Stock Q = Output K/Q= Capital Output Ratio C = Consumption S = Savings P = Population Q/P = Per Capita Income Savings Rate = 20% Consumption Rate = 80% Capital Output Ratio = 3 Two Guys Opinions… T 0 K 30 Q 10 C 8 S 2 P 100 Q/P .1000 Two Guys Opinions… T 0 1 K 30 32 Q 10 10.67 C 8 8.56 S 2 2.13 P 100 102 Q/P .1000 .1046 Two Guys Opinions… T 0 1 2 K 30 32 Q 10 10.67 C 8 8.54 9.10 S 2 2.13 2.28 P 100 102 104 Q/P .1000 .1046 .1115 34.13 11.38 Two Guys Opinions… T 0 1 2 3 K 30 32 Q 10 10.67 C 8 8.54 9.10 9.70 S 2 2.13 2.28 2.43 P 100 102 104 106 Q/P .1000 .1046 .1115 .1167 34.13 11.38 36.41 12.14 Two Guys Opinions… T 0 1 2 3 K 30 32 Q 10 10.67 Money supply C 8 8.54 9.10 9.70 S 2 2.13 2.28 2.43 P 100 102 102 104 Q/P .1000 .1046 .1115 .1167 10.0 10.0 10.0 10.0 34.13 11.38 36.41 12.14 Two Guys Opinions… T 0 1 2 3 K 30 32 Q 10 10.67 Money supply C 8 8.54 9.10 9.70 S 2 2.13 2.28 2.43 P 100 102 102 104 Q/P .1000 .1046 .1115 .1167 10.0 10.67 11.38 12.14 34.13 11.38 36.41 12.14 Two Guys Opinions… T 0 1 2 3 K 30 32 Q 10 10.67 Money supply C 8 8.54 9.10 9.70 S 2 2.13 2.28 2.43 P 100 102 102 104 Q/P .1000 .1046 .1115 .1167 10.0 12.00 14.00 16.00 34.13 11.38 36.41 12.14 Two Guys Opinions… T 0 1 2 3 K 30 32 Q 10 10.67 C 8 8.54 9.10 9.70 S 2 2.13 2.28 2.43 P 100 102 102 104 Q/P .1000 .1046 .1115 .1167 34.13 11.38 36.41 12.14 How do you raise per capita income… Increase capital stock Improve capital output ratio Slow the growth of population (retirement age/etc.) Increase savings decrease consumption (consumption has to take place somewhere) Others??? Classic Economic Theory Comparative Advantage Global Integration Policies of Second and Third World ? Where protectionism reigns supreme… The Future of Hemispheric Integration A bit of history… Washington Consensus 1990s phenomenon Simon Bolivar…Yo he arado en el mar… The Future of Hemispheric Integration Bill Clinton & The Washington Consensus The Future of Hemispheric Integration REFORMS ADVOCATED BY THE WASHINGTON CONSENSUS: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Competitive Exchange Rates Trade Policy Foreign Direct Investment Fiscal Discipline Reordering Public Expenditure Priorities Tax Reform Liberalizing Interest Rates Privatization Deregulation Property Rights THE TEN COMANDMENTS 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. You shall have no other gods before Me. You shall not make unto yourself any graven image. You shall not take the name of the Lord your God in vain. Remember the Sabbath day, to keep it holy. Honor your father and your mother. You shall not kill. You shall not commit adultery. You shall not steal. You shall not bear false witness. You shall not covet. 1. You shall have no other gods before Me. 2. You shall not make unto yourself any graven image. 1. Competitive Exchange Rates 2. Trade Policy 3. Foreign Direct Investment 4. Fiscal Discipline 5. Reordering Public Expenditure Priorities 3. You shall not take the name of the Lord your God in vain. 4. Remember the Sabbath day, to keep it holy. 5. Honor your father and your mother. 6. You shall not kill. 7. You shall not commit adultery. 8. You shall not steal. 9. You shall not bear false witness. 10.You shall not covet 6. Tax Reform 7. Liberalizing Interest Rates 8. Privatization 9. Deregulation 10. Property Rights Utilitarianism vs. Social Justice BUENOS AIRES CONSENSUS EXCERPTS FROM THE BUENOS AIRES CONSENSUS: Point 1 “We … reaffirm our desire… that all citizens may fully exercise…fundamental rights and freedoms – including the right to development – in a climate of liberty and social justice…” Point 2 “We emphasize…our historic responsibility for combating poverty, unemployment, hunger, illiteracy and disease which collectively constitute a loss of autonomy and dignity for those afflicted, obstructing them from fully exercising their rights and freedoms as citizens.” EXCERPTS FROM THE BUENOS AIRES CONSENSUS: Point 5 “We commit ourselves to…sustainable growth and equitable distribution of benefits…” Point 9 “We reaffirm our commitment to …balanced economic and social development.” EXCERPTS FROM THE BUENOS AIRES CONSENSUS: Point 13 “We reaffirm our conviction that decent work… constitutes the most effective instrument for improving the lives of our peoples… [and] to a course of action that will allow social cohesion in our communities. Point 15 “ We restate a proud conviction that Mercosur is … a catalyst for the realization of shared values and traditions…” EXCERPTS FROM A Theory of Justice: Veil of Ignorance Liberty Principle Difference Principle THANK YOU. The Future of Hemispheric Integration http://www.youtube.com/watch?v=gYGrn0hZlCQ Larry King http://www.youtube.com/watch?v=9mF-b658084 Jon Stewart http://www.halturnershow.com/AmeroCoinArrives.html Amero Coins http://www.youtube.com/watch?v=vyq4gzvAeRc CBC http://www.youtube.com/watch?v=6hiPrsc9g98 ???? http://www.youtube.com/watch?v=T74VA3xU0EA&mode=related&search= http://www.youtube.com/watch?v=T74VA3xU0EA&mode=related&search Lou Dobbs The Future of Hemispheric Integration