1 UK outlook 'exceptionally strong' (BBC) The outlook for
the economy over the next three months is "exceptionally strong"
according to the employers' organisation the CBI. Its latest monthly survey of
675 firms, indicated that growth expectations were the strongest since the CBI
started collecting data in 2003. The data for April showed a growth in output
for businesses surveyed. Retail and services showed the strongest output
growth, while manufacturers reported solid progress.
In a
statement the CBI described the outlook for the next three months as
"exceptionally strong and broad-based". The organisation's chief
policy director Katja Hall said: "These latest growth figures, and the
strong expectations for the next quarter, provide further encouraging signs of
increasing vigour and confidence across the UK economy. "While consumer
spending accounted for the lion's share of GDP growth last year, there are firm
indications of growth becoming more broad-based."
Earlier
this month the Office for National Statistics (ONS) confirmed that rises in
weekly earnings have finally caught up with inflation. That was seen as a
significant moment for the economy and could boost growth in the future.
2 For middle classes, the American dream is just a dream (Michael Cohen in The Guardian) During the 2012 presidential election, Republican nominee Mitt Romney regularly liked to joke that President Obama wanted the US economy to look "more like Europe". In the context of modern American politics, few insults are more stinging. To be European is to be somehow effeminate, irresolute and, perhaps worst of all, socialist. It's the opposite of the "rugged individualism" and "exceptional nature" of the uniquely American experiment in self-government.
But, as a sobering New York Times article last week made clear, America could have a lot to learn by looking to Europe. According to the New York Times, the American middle class – the linchpin of the country's phenomenal post-war economic growth – can no longer call itself the richest in the world. "While the wealthiest Americans are outpacing many of their global peers," says the NYT, "across the lower- and middle-income tiers, citizens of other advanced countries have received considerably larger raises over the last three decades." America's poorest citizens lag behind their European counterparts; 35 years ago, the opposite was true.
While a majority of Americans tenaciously continue to hold dear to the American Dream – that long-standing American ideal that if you work hard anything is possible – more and more people are reporting that the opportunity for social advancement feels increasingly out of reach for them and their children. Indeed, it is hard to think of a more disquieting trend in American society than the fact that those in their 20s and 30s are less likely to have a high school diploma than those between the ages of 55 and 64.
Granted, no one actively set out to attack the middle class in America. There wasn't some evil plan hatched behind closed doors to wreak socio-economic havoc. But the decline of the American middle class, the ostentatious wealth of the so-called 1% and the crushing economic anxiety of the growing number of poor Americans have happened in plain sight. It is the direct result of a political system that has for more than four decades abdicated its responsibilities – and tilted the economic scales toward the most affluent and well-connected in American society. The "choice" that America made to pursue the path of decline will be with us for some time to come. Kind of makes looking to Europe seem like not such a bad idea.
http://www.theguardian.com/commentisfree/2014/apr/26/middle-class-american-dream-just-dream
3 The scarcity fallacy (Matt Ridley in The Wall Street Journal) How many times have you heard that we humans are "using up" the world's resources, "running out" of oil, "reaching the limits" of the atmosphere's capacity to cope with pollution or "approaching the carrying capacity" of the land's ability to support a greater population? The assumption behind all such statements is that there is a fixed amount of stuff—metals, oil, clean air, land—and that we risk exhausting it through our consumption.
But here's a peculiar feature of human history: We burst through such limits again and again. After all, as a Saudi oil minister once said, the Stone Age didn't end for lack of stone. Ecologists call this "niche construction"—that people (and indeed some other animals) can create new opportunities for themselves by making their habitats more productive in some way. Agriculture is the classic example of niche construction: We stopped relying on nature's bounty and substituted an artificial and much larger bounty.
Economists call the same phenomenon innovation. What frustrates them about ecologists is the latter's tendency to think in terms of static limits. Ecologists can't seem to see that when whale oil starts to run out, petroleum is discovered, or that when farm yields flatten, fertilizer comes along, or that when glass fiber is invented, demand for copper falls.
Economists point out that we keep improving the productivity of each acre of land by applying fertilizer, mechanization, pesticides and irrigation. Further innovation is bound to shift the ceiling upward. Jesse Ausubel at Rockefeller University calculates that the amount of land required to grow a given quantity of food has fallen by 65% over the past 50 years, world-wide.
Why did scarcity theories not materialise? In a word, technology: better mining techniques, more frugal use of materials, and if scarcity causes price increases, substitution by cheaper material. We use 100 times thinner gold plating on computer connectors than we did 40 years ago. The steel content of cars and buildings keeps on falling. Thanks to fracking and the shale revolution, peak oil and gas have been postponed.
Haiti is 98% deforested and literally brown on satellite images, compared with its green, well-forested neighbor, the Dominican Republic. The difference stems from Haiti's poverty, which causes it to rely on charcoal for domestic and industrial energy, whereas the Dominican Republic is wealthy enough to use fossil fuels, subsidizing propane gas for cooking fuel specifically so that people won't cut down forests.
If I could have one wish for the Earth's environment, it would be to bring together the two tribes—to convene a grand powwow of ecologists and economists. I would pose them this simple question and not let them leave the room until they had answered it: How can innovation improve the environment?
http://online.wsj.com/news/articles
/SB10001424052702304279904579517862612287156?mod=trending_now_2
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