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Project Syndicate: It's time to debunk myths about India and China. Observer: Blame Ireland's leaders for the crisis. WashPost: Don't reward Israel for its bad behavior.
Microfinance needs more sensible regulation
An opinion piece in the Economist argues that the microfinance industry needs more sensible regulation. Politicians should stop trying to enact overly invasive restrictions. They hurt microfinance institutions and jeopardize their efforts to attract private capital.
QUOTE: The Indian government should also allow MFIs to take deposits, which they are currently prevented from doing: this would make them less dependent on capital markets for funding.
Debunking myths about India and China
Pranab Bardhan, professor of economics at the University of California at Berkeley, writes in Project Syndicate that China and India deserve the attention they receive for their remarkable growth, but there are misperceptions about their economies. China is not yet the manufacturing center of the world, and India’s information technology-enabled services are too small to transform the nation.
QUOTE: Much of the dramatic poverty reduction in China over the last three decades was due not to integration into the global economy, but to domestic factors like growth in the agricultural sector (where mass poverty was concentrated).
Ireland’s leaders are to blame for its crisis
An editorial in London’s The Observer argues that Ireland’s elite is to blame for its economic crisis as its leaders ran the country “like a casino.” The government became dependent on the property market and went to any length to keep it going.
QUOTE: The initial crisis response in 2008 was designed in such a way as effectively to absorb the doomed banking sector into the state, with no safeguards for taxpayers. While fitting as a kind of poetic commentary on what had happened in the boom years, as policy it was insane.
Obama pushes a new free trade bloc
Correspondent Jonathan Adams writes in GlobalPost that President Obama is pushing the Trans-Pacific Partnership as a way to boost the American and global economies. Adams writes that the trade deal’s prospects may be dubious as the political costs of it are great.
QUOTE: If the politics of TPP look thorny, they're nothing compared to the politics of a wider trans-Pacific deal. Protected agricultural sectors have so far helped prevent a Korea-China deal, a Japan-Korea deal, or an expansion of the ASEAN-China deal to include Korea and Japan.
Japan’s aging population poses the biggest threat to its economy
An opinion piece in the Economist argues that the biggest threat to Japan’s economy is now its aging population. Japan’s population is growing older faster than any other country’s. The piece argues that if Japan does not work to address its aging population, the effects on the economy will be intractable.
QUOTE: Falling output may weaken Japan’s sense of self-confidence and its standing in the world. What is more, Japan has the highest government debt relative to GDP in the rich world. If debt continues to grow as the economy contracts, it will become even harder to bear.
‘Stability’ is the new ‘democracy’
Columnist Doug Saunders writes in Toronto’s Globe and Mail that political rhetoric and foreign policy goals have changed after the Iraq and Afghan wars. The international community now seeks “stability” when dealing with countries like China or Sudan, instead of “democracy.”
QUOTE: We now talk about stability, or containment, or conflict prevention. Because the word was abused so violently by Mr. Bush, it may be a generation before democracy returns to that list.
Strong business leadership is needed to save the economy from protectionism
Jean-Pierre Lehmann, a professor of international political economy at IMD, Lausanne, Switzerland, writes in the Times of India that global leaders must do more to prevent a rise of protectionism. Business leadership is needed to push through a strong multilateral trade framework.
QUOTE: The fact that there is turbulence is all the more reason why leadership, good governance and a solid rules-based multilateral trade framework are absolute imperatives.
Sarah Palin might make it to the top
Columnist Frank Rich writes in the New York Times that if former Alaska governor Sarah Palin decides to run for US president in 2012, she has a good chance of becoming the Republican candidate. Palin manages to turn things that would damage other candidates – like gaffes, family scandals and “shameless lying” – to her advantage.
QUOTE: Sooner or later Palin’s opponents will instead have to man up — as Palin might say — and actually summon the courage to take her on mano-a-maverick in broad daylight. Short of that, there’s little reason to believe now that she cannot dance to the top of the Republican ticket when and if she wants to.
Eurozone nations must face up to the need for debt restructuring
An editorial in London’s Daily Telegraph argues that a single currency in Europe has not been successful because it has not been accompanied by political unification. The piece argues that bailing out eurozone nations cannot continue.
QUOTE: Voters in solvent nations such as Germany are unwilling to see their taxes used to prop up their bankrupt neighbors indefinitely, which means that Ireland, Greece, Portugal and perhaps Spain will have to restructure their debts.
The US plans on rewarding Israel for its bad behavior
Daniel Kurtzer, a former US ambassador to Israel and Egypt, writes in the Washington Post that the United States would be rewarding Israel for bad behavior if it provides it military assistance in exchange for a three-month freeze in settlement construction.
QUOTE: While Washington will almost certainly come to regret bribing Israel, Israel may regret receiving such a bribe even more.