Nearly 17 months ago, dozens of heavily-armed Honduran and U.S. police agents carried out a pre-dawn drug interdiction operation along the Patuca River that left two women, a teenager and a young man dead and several others injured.  There is no evidence

Dean Baker
Al Jazeera English, October 8, 2013

Mark WeisbrotÚltimas Noticias, 4 de octubre, 2013En Inglés

Dean Baker
Truthout, October 7, 2013

A new report [PDF] from Rights Action examines the conflict in Río Blanco, Honduras, where the indigenous Lenca community has been involved in a stand-off against security forces and a major development company (Desarollos Energéticos, SA, or DESA) in order to prevent the construction of hydroelectric dams on the Gualcarque River. The report’s release comes just a few weeks after a court ordered the arrest of one of the most prominent figures opposing the dams, Berta Cáceres, coordinator of the Civic Council of Popular and Indigenous Organizations (COPINH), on weapons and other charges that are widely seen as bogus. Two of Berta’s colleagues, Tomás Gómez and Aureliano Molina also face charges under accusations that they “had instigated the protests” that have blocked access to the project site for over 185 days, and Amnesty International has declared that “If they are imprisoned,” the organization “will consider them prisoners of conscience.”

The case has attracted international support for COPINH, the persecuted activists, and the Lenca community of Río Blanco, with over 11,000 people having signed a MoveOn.org petition urging the U.S. government to tell the Honduran authorities to drop the bogus charges. Protests have been held in several cities in the U.S. and various Latin American countries in support of Cáceres, Gómez and Molina and the Río Blanco community. "In Honduras it is increasingly clear that those who oppose a government plan may be imprisoned," Ana Marcia Aguiluz of the Center for Justice and International Law told the Associated Press.

The Rights Action report addresses the charges against Cáceres and her colleagues, concluding that:

The public prosecutor’s office and the judiciary have aggressively and tendentiously prosecuted accusations against Lenca community members, and the human rights activists who support them.  The state has subjected human rights defenders to penal processes for actions which are simply the legitimate defense of the rights of indigenous communities.  This has led to the impending imprisonment of one of Honduras’ most recognized indigenous rights activists, Berta Caceres.

That's what readers of an NYT column by Stephen D. King, the chief economist at HSBC, must be wondering. The piece, perversely titled "When Wealth Disappears," tries to construct a story of gloom and doom out of King's own confusion about economics.

The basic point seems to be that we have to adjust to a period of slower growth based on his claim that the growth of the period from the end of World War II until the end of the last century was an anomaly. To start with, the period of strong growth by most accounts is in fact much longer, going back well into the 19th century.

Furthermore, the accounting is more than a bit peculiar. Most of the slowdown in growth that troubles King is due to slower population growth. This means that countries might see slower overall growth, but little change in per capita GDP growth. Since it is the latter that affects living standards, why would anyone care if overall growth slows?

The same logic applies to one of the issues that troubles King. With most women now already taking part in the paid labor force, we cannot have the same gains to growth from more women entering the labor force as we did in the period from 1960 to 2000. While this is true, that growth was attributable to an increase in workers' hours, not an increase in output per worker. Certainly it is good that women have opportunities that they did not previously, but we usually think of society getting richer because we are getting more money per hour of work, not working longer hours. (On that point, if we want to adopt the Stephen King growth measure, Europe can see a 25 percent jump in output if European workers decided to put in the same number of hours each year as workers in the United States.)

If we have to fear a slowdown in productivity growth, as some economists have argued, this would imply a slower improvement in living standards. But King explicitly rejects this view:

"The end of the golden age cannot be explained by some technological reversal. From iPad apps to shale gas, technology continues to advance."

Alan BarberEconomic Intelligence (U.S. News & World Report), October 4, 2013

In "The Age of Oversupply" (Penguin Group, 2013), Daniel Alpert makes a compelling case that the United States and the world are stuck in a serious crisis of insufficient demand for the foreseeable future. According to Alpert, the result is likely to be a prolonged period of slow growth and high unemployment barring coordinated international efforts to counter the problem.

Before giving the outline of Alpert's argument, let me get out my baseball bat to beat home a simple point. Standard economic theory does not believe in a world in which demand is a problem except possibly for short periods of time during recessions. This means that we don't have to worry about having enough demand because the market will automatically adjust to keep the economy at the full employment level of output. If there is unemployment, then interest rates will fall enough to induce the additional investment, consumption, or net exports (slightly longer story) needed to bring the economy back to full employment.

Mark WeisbrotThe Guardian Unlimited, October 4, 2013En Español