The main problem with the Gibbs kerfuffle is the lack of understanding of what lies beneath the surface. In my previous diary, "Shorter Gibbs", I presented one view: that of the political domninance of economic elites over both parties, as described by Jacob Hacker and Paul Pierson describe in their new paper, "Winner-Take-All Politics: Public Policy, Political Organization, and thePrecipitous Rise of Top Incomes in the United States". But another way of looking at it is in terms of specifically what Versailles Dems are up to, in contrast with progressives. And the most economical way to describe that is in terms of neoliberalism vs. social democracy. Roughly speaking, social democracy represented the West's non-communist consensus after WWII. They were not about to let it get too far out of hand, of course. After getting rid of the Mosadegh government in Iran and restoring the Shah's dictatorship, our next CIA adventure was overthrowing the Arbenz government in Guatemala, precisely because it was trying to become too much of a social democracy, aspiring to be more like Europe in the future, and less like its own impoverished past.
Still, when it came to the development community--concerned as it was to promote enough growth and hope to keep Communism at bay--a tepid form of the social democratic model, providing education, sanitation, and the like as public infrastructure goods, was basically taken for granted as part of how things should be done. This view shifted around the time of Ronald Reagan's election, with a pronounced re-direction toward the neo-liberal model in which cutting the size of the state was supposed to be the key to prosperity--what quickly came to be known abroad as the "neo-liberal model". It's the same model, actually, that New Democrats came to pick up on with increasing enthusiasm in the 1990s. And it's visible in many aspects of Obama's politics today.
Because such policies were implemented so widely around the world--thanks largely to the imposition of "structural adjustment policies" by IMF/World Bank--there's actually a rather robust database by which we can judge the effectiveness of neoliberalism, and five years ago, that's just what the Center on Economic Policy Research (CEPR) did with "Scorecard on Development: 25 Years of Diminished Progress" by Mark Weisbrot, Dean Baker and David Rosnick.
In its executive summary, the paper first explained its most significant finding:
This paper looks at the available data on economic growth and various social indicators - including health outcomes and education - and compares the last 25 years (1980-2005)1 with the prior two decades (1960-1980). The paper finds that, contrary to popular belief, the past 25 years (1980-2005) have seen a sharply slower rate of economic growth and reduced progress on social indicators for the vast majority of low- and middle-income countries.
And explained the basic methodology it used in order to avoid unfairly biasing the results:
Countries are divided into quintiles on the basis of their starting point at the beginning of each period. The study therefore does not compare the performance of the same country over the two periods, because this would tend to find reduced progress for the second period due to "diminishing returns." In other words, it would be more difficult for a country to move from a life expectancy of 70 to 75, than from 50 to 55. By comparing the performance of countries that start out at a certain level in 1960, with countries that start out at the same level in 1980, this study avoids the possibility of interpreting such inherent limits on progress as evidence of failure in the second period.
It then cited some of it's most important findings, starting with a stagnation in GDP growth:
A sharp fall-off in the growth of GDP per capita was found for all groups of countries except the bottom quintile. (See Figure 1) In the fourth quintile, marked by per capita incomes between $1238 and $2364, growth falls from 2.4 percent annually in the first period to 0.7 percent in the second period. To get an idea how much difference this makes over time, at 2.4 percent growth the country's income per person will double in about 29 years. At 0.7 percent growth, it would take 99 years.
The middle quintile, with GDP per capita between $2364 and $4031, drops from a 2.6 percent growth rate in the first period to 1 percent in the second. The second quintile ($4086-8977) falls even further: from 3.1 percent in the first period to 1.3 percent in the second period.
Even the top quintile, which at $9012 to $43,713 contains a mixture of middle-income and highincome countries shows a sizeable falloff in growth, from 2.6 percent in the first period to only 1.3 percent in the second period....
The decline in growth rates for all but the very poorest countries is clearly quite dramatic. And given this decline, it's not surprising to find declines in many other indicators as well. Less text, more charts on the flip to fill out the whole story.
A decline in the rate of improvement for life expectancy was found for the vast majority of low- and middle-income countries. (See Figure 2) The biggest drop was in the fourth quintile, with life expectancy between 44 and 53. These countries saw an average annual increase of 0.56 years for 1960-1980, but almost no progress - 0.03 years for the second period. Over 20 or 25 years this makes a large difference. For the first period, countries in this quintile increased their life expectancy by about 11 years. If this rate of improvement had continued, the countries in this quintile in the second period would have raised life expectancy by 12 years; instead they saw an increase of only 0.7 years.
The bottom, middle, and second quintiles also saw declines in the rate of progress.
There was a furthere breakdown into male:
And female:
Mortality Rates
A decline in the rate of improvement for adult mortality was found for male and female adults, for most groups. (See Figures 5 and 6). For females, all quintiles except the best one show worse performance for the second period, with the fourth quintile showing an actual increase (rather than a decline in the rate of reduction) in mortality rates. For males, the bottom three quintiles show worse performance for the second period, with the fourth quintile showing an actual increase in mortality rates.
Next, child mortality:
A decline in the rate of progress for child (under 5) mortality was found across all quintiles, although the reduction in progress is relatively small in the top two quintiles. (See Figure 7).
And infant mortality:
A decline in the rate of improvement for infant mortality was found for all groups of countries. (See Figure 8).
Educational Attainment
A larger number of measures of educational progress were available, and though there was some variation, the overall results showed slower progress under the neo-liberal policy regime.
First, we see a slowdown in total public spending:
We see a preponderance of declines in primary school attendance as well:
Both for males:
And females:
We see declines for all five quintiles in secondary school enrollment gains:
Both for male:
And female:
And we see declines as well for tertiary education--though not as uniformly:
The most hopeful outcome is a relative holding pattern with respect to general adult literacy:
That's the quckie, data-driven overview of neo-liberalism's global failure, 1980 to 2005. In the five years since then... well, we've got ourselves a global great recession, now haven't we? So the picture painted above was that of neo-liberalism's "good times".
I hope that begins to paint a clearer picture of what it is that Gibbs and Obama stand for, and what progressives stand against.
This is not a spat. It is not about who's a professional this, or a drug-taking that.
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