To an extraordinary degree, disease shapes human destiny. The Plague of Justinian (A.D. 542 to 755) decimated the enslaved across the Roman Empire and triggered a new era of feudalism. The Black Death’s toll centuries later sparked a social revolution that broke up the estates of feudal overlords and propelled the rise of new technologies—the iron plow in the countryside and, in cities, labor-saving devices like the printing press and water pumps.
Of course, history never repeats itself exactly. This pandemic hasn’t been nearly as deadly as those that depopulated the ancient world. And the novel coronavirus turns the Black Death paradigm on its head: rather than acting as a social leveler, it’s dramatically increased inequality. U.S. billionaires added almost $1 trillion to their fortunes during Covid-19, even as the new laboring underclasses face economic hardship and hunger.
Yet this respiratory disease has forced a profound reckoning. For better or worse, it has accelerated just about every transition we’re focused on at the Bloomberg New Economy, starting with the shift of wealth and power to the East, a journey that will in large part define the 21st century.
This week in the New Economy
By one estimate, the pandemic has given China a five-year jump on its goal to overtake the U.S. as the world’s largest economy, the Chinese leadership’s reward for locking down hard and early while the Trump administration fumbled its response—and then exacerbated it with mixed messaging, like holding super-spreader events in the White House.
Sure enough, the moment that underscored how geopolitics pivoted in 2020 came this week with a European Union-China investment agreement. German Chancellor Angela Merkel and other European leaders chose to look past Uighur internment camps and a Hong Kong democracy crackdown to a Chinese economy that’s likely to deliver at least one-third of global growth year after year. Volkswagen’s future, for example, is in China. The idea of any country signing up for a program of “decoupling” from the soon-to-be-biggest global economy is dead. Likewise, the incoming Biden administration’s hopes for a grand coalition to counter Beijing have come crashing down, even if the EU deal doesn’t preclude cooperation on specific issues like intellectual property theft.
What else has changed? Businesses over the past year have seen the future rushing toward them, and that future is digital—in the way the world works, shops and searches for entertainment and medical advice. A weightless economy favors companies with intangible assets: brand, scale and the ability to raise capital. Investment banks all over the world have recorded their best year ever for fees while e-commerce has exploded.
“Covid has acted like a time machine: it brought 2030 to 2020,” Loren Padelford, vice president at Shopify Inc., told The Wall Street Journal.
Wait for the backlash, though. China’s assault on Jack Ma’s digital empire isn’t all about the Communist party’s fear of uppity entrepreneurs. Alibaba’s monopolistic pretensions sit no better with regulators in Beijing than Google’s do in Brussels. Covid-19 has brought forward the antitrust showdown.
The worst crisis since the Great Depression has also advanced the way economists think about money. Few worry about the trillions of dollars in state support for shuttered businesses and laid off workers. In the new economy, fiscal outlays—whether on stimulus checks or physical infrastructure—pay for themselves in future GDP growth thanks to rock-bottom interest rates.
Another outcome is that a new social contract is emerging from this catastrophe. Poverty, notes the economist Adam Tooze, is now a political choice. In Brazil, the right-wing government of Jair Bolsonaro has actually rolled back poverty and inequality during the pandemic to levels unseen since at least 1970 through welfare payments. Many countries have similarly replaced lost income with emergency benefits. What happens when they expire? As Tooze notes, a decision not to relieve poverty, when it’s fiscally possible, is also political, with life-and-death consequences. Democratic politics are about to become even more contentious.
Then there’s the vaccine itself. More than a century elapsed between the identification of the typhoid fever pathogen and the development of a vaccine in the U.S. The polio shot took half a century. The mumps vaccine was rushed through in four years, a record that held until Pfizer-BioNTech developed a shot for Covid-19 in 10 months or so, thanks in part to advances in genomic sequencing. Expect further accelerated development in biotechnology and pharmaceuticals: Healthcare will be a major driver of growth and employment in the post-pandemic world.
There’s hope, too, for the biggest challenge of all: the fight to slow global warming and the climate crisis. In a year when ExxonMobil was kicked off the Dow Jones Industrial Average, and Tesla’s share price rocketed by almost 700%, China pledged to go carbon neutral by 2060. Europe, the U.S. and China are now aligned on net-zero. Wall Street is buying the green story: According to Citigroup Inc., about 50% of all new exchange-traded funds in Europe, the Middle East and Africa in 2020 were ESG-related.
At Bloomberg New Economy, we’re not going to make any bold predictions for 2021. But we’re pretty confident that Covid-19 has sowed the seeds of change that will be every bit as consequential over the long term as the plagues that spurred Europe’s passage from the Dark Ages to the Renaissance.
In science and technology, not to mention the way we work and play, we’ve just entered a new age of discovery.
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Janet Yellen says US must 'act big' to revive flagging economy – The Guardian
Economic Policy Advisor Provides Analysis of the United States Economy During 2000-2016 and Solutions for Improving Growth in Comprehensive Treatise – GlobeNewswire
ZOETERMEER, Netherlands, Jan. 19, 2021 (GLOBE NEWSWIRE) — Dutch economic policy advisor and international independent consultant Marc Stoffers has long been intrigued by the United States’ economic development. Despite the tools and resources at its disposal, the U.S. continues to suffer losses to market share both domestically and globally and has seen a decline in its overall economic growth. In his new book, “Problems and Possibilities of the US Economy,” Stoffers lays bare the ramifications of this downturn and, employing the Global Innovation Index (GII), identifies areas of opportunity for the U.S. to excel.
Using the GII, Stoffers investigates how the U.S. meets the pillars for Innovation Input and Innovation Output compared to other countries. He finds that the U.S.is a global leader in market sophistication and a top 10 country in knowledge and technology output as well as business sophistication. However, there are other areas where the U.S. is less successful such as institutions and creative output. To make matters worse, the U.S. lags firmly behind in relation to infrastructure and human capital and research.
As Stoffers explains in the text, the U.S.’s struggle to maintain a fierce competitiveness across all pillars has led to decreased market share and resulted in deficits to the balance of payment and the federal budget, inequality within the labor force and wage stagnation and has had a negative impact on employment. Using the GII, Stoffers creates a regression between the scores of several other countries and their gross domestic product (GDP). He then calculates the growth that would result from the U.S. becoming a global leader in every pillar.
By suggesting measures such as advancing the quality of schools, incentivizing students to pursue careers in science, technology, engineering and mathematics (STEM), increasing sustainable development and nurturing a favorable investment climate, Stoffers demonstrates that there is a clear pathway for the U.S. to regain stability and balance, and decrease inequality between groups in society. Ultimately, through “Problems and Possibilities of the US Economy,” he instills hope that the U.S. can reclaim its position as a top performer in the global economy.
“The U.S. economy can be made healthier by introducing an improvement of skills, a level playing field with foreign competitors and a more robust innovation system,” said Stoffers. “A stronger U.S. can emerge and lead the Western World easier and more efficiently than before.”
About the author
Marc Stoffers graduated from the University of Tillburg with a master’s degree in business econometrics. After completing his military service, he served as a policy advisor for the Bureau for Economic Policy Analysis (Centraal Planbureau). Since retiring, he has acted as an independent freelance consultant involved in model building and economic analysis for macroeconomic projects in various international countries. Stoffers currently resides in Zoetermeer, Netherlands.
Xlibris Publishing, an Author Solutions, LLC imprint, is a self-publishing services provider created in 1997 by authors, for authors. By focusing on the needs of creative writers and artists and adopting the latest print-on-demand publishing technology and strategies, we provide expert publishing services with direct and personal access to quality publication in hardcover, trade paperback, custom leather-bound and full-color formats. To date, Xlibris has helped to publish more than 60,000 titles. For more information, visit xlibris.com or call 1-888-795-4274 to receive a free publishing guide.
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Biden’s first 100 days: What to expect on Covid-19, the economy and immigration – FRANCE 24 English
Issued on: 19/01/2021 – 11:55
US President-elect Joe Biden is set to issue a flurry of executive orders following his inauguration at noon on Wednesday as well as legislation that will quickly begin working its way through Congress on pandemic relief, immigration and much more.
A top priority for the 46th US president will be securing congressional approval for his $1.9 trillion stimulus plan to revive the economy and administer 100 million vaccines by his 100th day in office.
Biden has promised on Day One to extend a pause on evictions and foreclosures, as well as federal student loan payments; move to have the US rejoin the World Health Organization and Paris climate accord; overturn a travel ban on those from several Muslim-majority countries; order agencies to begin reuniting families separated at the border; and mandate mask-wearing on federal property.
According to a memo released by incoming chief of staff Ron Klain, the new president will also take quick action on what the Biden administration sees as the four main challenges the United States is facing. “We face four overlapping and compounding crises: the Covid-19 crisis, the resulting economic crisis, the climate crisis, and a racial equity crisis,” Klain wrote.
“In his first ten days in office, President-elect Biden will take decisive action to address these four crises, prevent other urgent and irreversible harms, and restore America’s place in the world,” Klain added.
Here’s what to expect from his first 100 days at the White House.
Biden has described America’s Covid-19 vaccine rollout as “a dismal failure thus far” and vowed to “move heaven and earth to get more people vaccinated”. He has set his administration a goal of 100 million shots by the end of his first 100 days as president.
Biden has pledged to have 100 vaccination centres supported by federal emergency management personnel up and running during his first month in the White House. He will also ask Americans to commit to 100 days of mask-wearing from his first day on the job.
The incoming president has said he will use the Defense Production Act to increase vaccine supplies and ensure the pandemic is under control for most public schools to reopen nationwide by his 100th day in office.
‘Our plan is as clear as it is bold: get more people vaccinated for free’
- Economic stimulus plan
The Democrat’s $1.9 trillion stimulus proposal involves providing $1,400 direct payments to Americans to prop up the virus-hammered economy. Touting his plan, Biden said “the return on these investment in jobs, racial equity will prevent long-term economic damage, and the benefits will far surpass the cost”.
‘We cannot afford inaction’ on economy: Biden unveils plan to support pandemic-hit economy
Biden has also pledged to wipe out corporate tax cuts where possible, while doubling the levies US firms pay on foreign profits. Another flagship policy includes hiking the hourly minimum wage to $15, double the current amount.
Biden announces national minimum wage hike
- WHO, Paris accord and Iran
Other Day One pledges include moving to rejoin the World Health Organization and the Paris climate accord, which Trump withdrew from. Biden is also expected to begin the process of rejoining a landmark international agreement designed to curtail Iran’s nuclear programme.
US presidential transition: How will Biden change America’s foreign policy?
- Climate and the environment
Biden has announced executive action on his first day in office to formulate a plan to achieve 100% clean energy economy and net-zero emissions by 2050. He will also enact an executive order “to conserve 30% of America’s lands and waters by 2030” in line with other “30% by 2030” pledges made by 50 countries at a One Planet Summit in Paris earlier this month.
Biden is also expected to reverse President Donald Trump’s rollback of some 100 public health and environmental rules that the Obama administration instituted.
Biden’s busy Day One schedule includes the creation of task forces on homelessness and reuniting immigrant parents with children separated at the US-Mexico border. The incoming president has pledged to provide a pathway to citizenship for 11 million immigrants who came to the US illegally as children. He has also vowed to overturn the Trump administration’s travel ban on those from several majority-Muslim countries.
Dreamers: Hopes high that Biden administration will bring immigration reform
- Discrimination, gun control
Biden has vowed to repeal a transgender military ban enacted by his predecessor and restore Obama-era guidance for transgender students in schools, saying this will protect “students’ access to sports, bathrooms, and locker rooms in accordance with their gender identity”.
He has also pledged to create a police oversight commission to combat institutional racism by the end of his first 100 days.
The incoming administration also plans to send bills to Congress seeking to mandate stricter background checks for gun buyers and scrap liability protections for firearm manufacturers.
(FRANCE 24 with AP)
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