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Article Artículo

Thomas Friedman Says Donald Trump Could Boost Productivity Growth by Ending NAFTA

Economists have been worried about the weak productivity growth of the last decade, with some worried it will continue indefinitely. In the last decade, productivity growth has averaged less than 1.0 percent annually. This compares to a rate of close to 3.0 percent a year in the decade from 1995 to 2005 as well as the quarter century from 1947 to 1973. Slower productivity growth limits the extent to which wages can rise, except through redistribution.

However, Thomas Friedman apparently believes that if we end NAFTA, we will bring back manufacturing to the United States. But he argues that the new manufacturing capacity will be far more productive than the industry at present, and therefore mean very few jobs. He told readers:

"And if Trump forces all these U.S.-based multinationals to move operations from Mexico back to the U.S., what will that do? Help tank the Mexican economy so more Mexicans will try to come north, and raise the costs for U.S. manufacturers. What will they do? Move their factories to the U.S. but replace as many humans as possible with robots to contain costs."

Economists usually believe that expanding trade leads to higher productivity, so Friedman is offering a novel thesis with this idea that contracting trade will lead to more rapid productivity growth.

CEPR / February 08, 2017

Article Artículo

Haiti

Latin America and the Caribbean

World

Haiti Inaugurates a New President Dogged by Money Laundering Probe, Low Voter Turnout

Jovenel Moïse will be inaugurated as Haiti’s new president today as the country returns to constitutional order after a one-year extra-constitutional period of interim rule due to electoral delays.  Moïse had previously come in first in an October 2015 election, only to have the results thrown out due to fraud. Rerun in November 2016 under the interim government that replaced former president Michel Martelly, the elections had Moïse securing more than 50 percent of the vote, winning in the first round.

But serious questions continue to dog Moïse as he takes office. Jacqueline Charles of the Miami Herald reports:

Since his win, Moïse has been on a countrywide tour, celebrating his victory, endorsing candidates for the recently held local elections — and battling money-laundering suspicions.

Moïse has dismissed the suspicions as the work of political opponents. The probe began in 2013 under Martelly’s administration when the anti-financial crimes unit was tipped off about a suspicious bank transaction, the current head of the unit, Sonel Jean-François, has said.

Over the weekend, an investigative judge assigned to the case sent his findings to the government prosecutor, but the judge’s order has not been made public. Government prosecutor Danton Léger has yet to say whether he will dismiss the case, send it back to the judge for further review, or prosecute Moïse.

Should he seek to prosecute Moïse, Haiti could find itself in an even deeper crisis than the one triggered by the annulled October 2015 presidential elections.

In a 7-page letter dated February 6, Leger, the government prosecutor, requested further information on the allegations against Moïse, ensuring it will continue to hang over the new president.

The money laundering allegations, however, are far from the only topic overshadowing Moïse’s inauguration today. A new report on Haiti’s November elections, from international legal observers, has raised questions as to how effective the new administration may be given the historically low turnout. The report’s authors also note that Haiti’s national identity office was hindered by significant problems, affecting the ability of Haitians to vote:

The report notes that despite many improvements in security and electoral administration over the 2015 elections, the 21 percent voter turnout represents the lowest participation rate for a national election in the Western Hemisphere since 1945. “Many Haitians did not vote, not because they did not want to, but because they were unable due to difficulties in obtaining electoral cards, registering to vote and finding their names on outdated electoral lists,” said attorney Nicole Phillips, delegation leader and co-author of the report.

The report documents how many would-be voters were disenfranchised on November 20, due to pervasive errors on electoral lists, difficulties accessing identity cards, and lack of voter education. Haitian electoral authorities also failed to take adequate measures against fraudulent voting. Prior to the election, the head of the National Identification Office (ONI) admitted that 2.4 million activated but undistributed cards had gone missing, which opened the door to fraud via trafficked identity cards.

The report’s authors also note with concern that Moïse could follow in the footsteps of his predecessor, former president Michel Martelly, who surrounded himself with figures from the Duvalier dictatorship and was criticized by human rights groups for his intimidation of journalists and imprisonment of opposition activists. “With a majority in parliament, the temptation for President Moïse to run roughshod over any opposition will be great,” said Brian Concannon, the executive director of the Institute for Justice and Democracy in Haiti, which published the report with the National Lawyers Guild and the International Association of Democratic Lawyers. “But with the backing of only 9.6 percent of registered voters, the incoming president will face serious limits to his popular mandate.”

Jake Johnston / February 07, 2017