1 America’s place in a multi-polar world (Linda Yueh on BBC) At a global conference a few years ago, former US Treasury Secretary Larry Summers revealed that Americans would really prefer to be the G1. Not the G7 grouping of the biggest economies, or even the G3, but the G1 – where America would be the sole decision-maker.
A big sign of the shift was when the British and other Europeans, as well as allies such as Australia and South Korea, all signed up to the China-led Asian Infrastructure Investment Bank (AIIB) to be founding members.
For countries who were rescued by the Bretton Woods institutions based in Washington DC (the IMF and the World Bank) just a decade and a half ago during the Asian financial crisis, it is quite a shift that south east Asia now see themselves as competitors to the world’s biggest economy. The confidence of Asians – not just the Chinese but other Asians too – is notable.
Now, there’s not only the AIIB, there’s also the Brics bank that is set up by the emerging markets of Brazil, Russia, India, China and South Africa. Perhaps that’s one sign of declining influence. After all, America as the sole superpower holds effective vetoes over the main multilateral institutions which have led not only development but how countries are rescued and economies are managed for most of the past century. Those days look numbered as China in particular wields its economic muscle globally.
For some economists, this isn’t surprising. The weight of global economic activity has been shifting East. Having another engine of demand surely helps a world economy that is struggling to get back to robust growth rates after the 2008 financial crisis. Wouldn’t Americans like to have other nations shoulder some of that burden?
Of course, America will remain in the spotlight. But it’s the relative decline of power that stings. After all, the Brits and other nations decided that any political repercussions from a displeased America weren’t enough to outweigh the economic gains of supporting China.
For the US, it’s hard to get used to not being the sole superpower. The AIIB and Brics bank sitting alongside the World Bank and IMF will be stark reminders. Britain was overtaken by America in the early part of the last century. Perhaps there are lessons to share there.
2 UK university class sizes are falling (The Guardian) Universities are spending more on facilities and class sizes are falling, a study has found. The amount of money committed to areas such as sport, careers services, health and counselling has steadily increased over the five years of the coalition government, researchers said.
Analysis by the Complete University Guide shows that there was an initial worsening in staff-to-student ratios after 2010, followed by an improvement across the whole of the UK that began with the introduction of fees of up to £9,000 a year in England.
The most recent figures, for 2013-14, suggest there is an average of 17.08 students per member of staff. In Wales the ratio worsened slightly between 2012 and 2013 before a reduction last year.
More graduates are receiving “good” honours degrees, with 70% achieving first or upper second class honours – up from 68% last year – while student satisfaction has also increased.
Dr Bernard Kingston, principal author of the Complete University Guide, said: “UK students seem to be getting a better deal for their higher tuition fees in almost every area. It remains to be seen how far this trend can continue but in the short term at least, students are benefiting from spending on facilities that affect them directly.”
In this year’s table the top three are unchanged, with the University of Cambridge retaining first place in the ranking of 126 universities, the University of Oxford second and the London School of Economics and Political Science third.
3 India’s farms as killing fields (Neeta Lal in Khaleej Times) This year’s harvest festival of Baisakhi in India had a decidedly funereal ring to it. Reports of farmers’ suicides, distress sales of farm produce and land to pay off debts kept trickling in from all corners of India. According to unofficial estimates, over 200 farmers have either committed suicide or died of shock over the last five weeks.
What had led to this large-scale rural distress is a toxic cocktail of a dramatic plummet in global commodity prices of cotton, wheat, basmati rice, sugarcane, tea and rubber and unseasonal rains that have ravaged verdant fields. The ruling political dispensation’s imprudent agrarian policies haven’t helped. The pan-India rural employment guarantee scheme has been severely curtailed, crop procurement has been restricted and states have been asked not to give bonuses to farmers as per an executive order from the central government.
Though agriculture contributes just 14 per cent to India’s GDP, it employs a whopping 49 per cent of the country’s workforce. About 80 per cent of Indian farmers are small and marginal which makes their cost of production very high. The recent Land Acquisition Bill Amendment has further undermined farmers’ interests by offering them a meagre recompense for acquiring their land.
The writing on the wall is clear. If the Indian economy is to sustain its current positive growth momentum, agriculture reforms need to be initiated pronto. Delays will not only harm the farming community, building up a greater groundswell of angst against the government, but also have a cascading effect on GDP growth. Rather than funnel billions more into ill-thought out subsidy programmes, the government should accelerate investments in irrigation, which will have a more positive impact on farming.