Only nine years late, we are to have a Parliamentary debate about our involvement in the Afghan conflict! What has bought our leaders to consider, at last, owning up to their duty to explain their policies which have so far killed almost twenty Australians? They felt no such need during the election, so it can […]
Just before the London G-20 Meeting in April, Andy Stoler and I wrote a paper for a booklet published by the Center for Economic Policy Research in which we suggested that the best way to make G-20 governments live up to their promises was to expose their misdeeds on trade policy—including those that nominally complied with their WTO obligation—using a public website.
Specifically, we recommended that the site should not be run by one of the global institutions (WTO, World Bank) that are owned by governments, but should be a private venture open to contributions from individuals around the world. Why? Well, as the FT notes, in an editorial today, sovereigns are not likely to put much pressure on themselves:
“The problem with naming and shaming wrongdoers is that, all too often, they turn out to be shameless.” Extract from Financial Times
I am delighted to learn that the co-editor of the booklet (Simon Evenett) and the publishers (CEPR) have created just such a website: Global Trade Alert. It has been launched in the past couple of weeks with the backing of institutional sponsors (government funds, mostly) and an advisory board of distinguished analysts. GTA already lists a couple of dozen measures with useful details including the trading partners and tariff lines affected (for goods measures).
A nicely implemented and potentially intriguing experiment in global transparency. Please visit and contribute.
So much for the Government’s “Operation Sunshine” that was supposed to make budget program expenditure more transparent and accountable.
On the biggest single program item, Defense—a staggering 2.3% of GDP or $27 billion dollars next year alone—it seems to be a case of re-negging and obscurity.
“As the first budget after a new Defence White Paper, there is a glaring absence of substantive information on funding, investment and reform. The best that can be said is that the budget is consistent with a White Paper that’s silent on when anything will occur or what things will cost. All we are offered is a vision of what the defence force will look like in 2030.” Extract from Australian Strategic Policy Institute
The ASPI’s chief analyst has described the Budget papers as “deliberately vague”.
The budget to be introduced next Tuesday will be the first to fully implement the recommendations of the (former Senator Andrew) Murray Review on cutting gobbledygook and sloppiness out of budget estimates and on enforcing more rigorous reporting and audit of government use of our money.
All of this is a good thing. It is being managed by Lindsay Tanner’s Ministry of Finance. But the program still falls some way short, in my view, of where the Australian government should be in reporting public expenditure; especially considering the amount of our cash that they’re slopping around in the name of ‘stimulus’.
Democracy ensures we get the governments we deserve.
Gideon Rachman seems to think we deserve only to be consoled for the political dilemma of G20 leaders rather than offered real solutions to the frailties of the global trade framework. He agrees the problem is the threat of ‘wiggle room’ protection:
“[I]f the world’s political leaders start deliberately increasing barriers to trade, they will deepen and worsen the economic crisis – and risk making the process of deglobalisation a permanent shift. Most political leaders know this – and so they are still a little embarrassed about direct measures to increase tariffs. So a new wave of protectionism will take indirect forms.” Extract from Gideon Rachman in the Financial Times
But he’s satisfied with the appearance of collaboration to expose and prohibit protection, being convinced there’s no resolve to take real action.
“It will be tempting to laugh, if and when the communiqué from the London summit contains the familiar pledges to avoid protectionism and to complete the Doha round. But it is probably important that world leaders at least promise to follow the path of virtue – even if they know that they may sin.”
That’s too sophisticated a dish for me, GR. If you say that you’re happy to eat smoke, then smoke is what you’ll be served.
This is the worst market recession since the global trading framework was created sixty years ago. We know what the threats are, we know what it means to avoid them. Don’t we deserve more than ’empty words’ from governments?
What should the G20 do, when they meet in London next month, to put an end to the growing use of what I’ve been calling ‘wiggle-room’ protection? Is ‘murky’ protectionism causing the coming collapse in trade volumes? Or will protectionism rise as a result? Supposing that they wanted to, could the G20 really crack-down on actions that close markets or discriminate against imports but are not clearly prohibited by WTO?
Richard Baldwin and Simon Evenett’s book, now available for download (free) at the VoxEU site, comprises brief essays by trade Ministers (notably, Australia’s Trade Minister, Simon Crean), high profile analysts and a number of leading trade experts.
“This ebook presents concrete steps that G20 leaders should take to avoid a negative protection-recession spiral and the threat it would pose to a global recovery.” Extract from The collapse of global trade, murky protectionism, and the crisis: Recommendations for the G20″
Andrew Stoler (former Deputy Director General of WTO) and I have a paper in the collection: “G20 surveillance of harmful trade measures” that proposes a novel but potentially highly effective ‘crowd-sourcing‘ approach to the exposure of harmful ‘wiggle-room’ measures.
We propose an open, public surveillance system whose components already exist—some of them in this website among thousands of others. Unlike the WTO surveillance mechanisms of the past, it allows those who have most at stake in a prosperous global economy—firms and households in rich countries and poor—to help safeguard the global recovery. Please check it out and let me know what you think.
This is a great idea that the Rudd government should adopt.
“…The ‘American Recovery and Reinvestment Act,’ better known as our national Hail Mary stimulus bill, … also contains a measure promoting a less-noted type of economic infrastructure: government data. In the name of transparency, all the Fed’s stimulus-spending data will be posted at a new government site, Recovery.gov”Extract from Wired Magazine
Lack of transparency (in financial markets) has turned a cyclical down-turn into a deep, world-wide, recession. Nothing better demonstrates the crucial role of transparency in markets. But transparency in government can stimulate growth, too.