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Colombia

Latin America and the Caribbean

World

Colombia Peace Talks Survive Elections, May Have Lasting Implications for Regional Integration and US-Led “War on Drugs”

Ending a very close race, incumbent Juan Manuel Santos won a decisive five-point victory Sunday in Colombia’s second round of presidential elections, beating challenger Óscar Iván Zuluaga, who had won the first round in an upset. The campaign centered on one issue: the future of the Santos-led peace process under way in Havana between the Colombian government and the rebel group FARC that may have the potential to end a half century of civil war.

Zuluaga, who had been hand-chosen by Santos’ predecessor, Alvaro Uribe, and ran in opposition to the peace talks (though he had softened his position after the first round), quickly conceded defeat this Sunday. Uribe, however, wasted no time in claiming that the elections had been marred by “massive fraud,” a charge quickly rejected by international electoral observers. 

Santos’ victory has certainly dealt a major blow to ‘Uribismo,’ as the rightwing movement around Uribe is known. Colombians largely seem to support the peace process as well as efforts to improve relations with neighboring countries Venezuela and Ecuador, and it looks as though few were convinced by Uribe’s wild charges during the campaign that the peace process would open the path to “Castrochavismo,” allowing the “FARC to run this country from Havana.” Uribe has long loomed over Colombian politics, but Zuluaga’s defeat signals that his influence may be waning, even on the political right. Meanwhile, Santos’ support of the peace talks won him the backing of some of Colombia’s most prominent business people, in addition to endorsements from indigenous groups and left-wing coalitions.  

Uribe might have thought twice about investing so much political capital in opposing the negotiations. While it is true that the peace talks had the support of Venezuela and Cuba, they also had the support of virtually every other country in the region, as well as the United Nations, in addition to broad domestic support. More to the point, the peace talks have the support of the United States. Just a month ago, on May 18th, U.S. Secretary of State John Kerry reaffirmed U.S. support for the peace process, which, given that they were the main election issue, arguably amounted to an endorsement of Santos.

CEPR and Peter Hayakawa / June 19, 2014

Article Artículo

Workers

When Will It Pay to Take Family and Medical Leave?

What does the United States have in common with the countries of Liberia, Sierra Leone, Swaziland, Samoa, and Papua New Guinea? Not much, other than being the only six countries in the world that do not mandate paid maternity leave. In fact, the Unites States does not provide for paid leave to employees who become sick with a serious illness either, nor to parents to care for a sick child or adult children tending to an ailing parent.

CEPR and Helene Jorgensen / June 19, 2014

Article Artículo

Is Uncertainty Delaying Hiring or Is This Just Another Make Work Project for People Who Write About the Economy?

For some of us the story of the downturn and the slow recovery is pretty damn simple. The collapse of a huge housing bubble created a big gap in demand that is not easily filled. (Name your favorite demand-filling candidates. You have consumption, non-residential investment, residential investment, government spending, and net exports -- that's all folks.) Since there was no plausible story whereby the economy could quickly fill this demand gap, continuing slow growth and high unemployment is not much of a surprise.

But no one wants to make our leading economists and policy makers look silly, so there is a considerable premium placed on efforts to make the simple story complicated. For example last week we had a discussion in the NYT raising the possibility that the economy's real problem is a skills shortage. Today, Catherine Rampell raises the troubling concern that job openings are up, but hiring isn't. Her conclusion is that firms are reluctant to actually go ahead and hire because of uncertainty about the future. She then lists causes of uncertainty which are supposed to be the cause for the delay. 

Before anyone gets too concerned about the bad effects of uncertainty on the economy, let's look at the data a bit more closely. We get our data on job openings from the Job Openings and Labor Turnover Survey (JOLTS). If we look at the most recent release and go over to the right two sets of columns we find "total separations." These are the workers who leave their jobs by quitting, layoffs, or firing. The survey shows that this number was roughly 4.5 million in the most recent month.

This is important because it means that over a six-month span we would anticipate that roughly 27 million workers will leave their job. That's a bit less than 20 percent of total employment.(The actual share will be somewhat less since some jobs will come open more than once.) This is noteworthy because it would suggest that most firms need not be too troubled about uncertainty in making a hire today since they are likely to see a substantial portion of their workforce leave in the near future in any case. In other words, if they hire someone who it turns out they didn't really need, odds are that someone will leave in the near future so they will need this worker.

This is especially true in sectors like retail and restaurant employment which have a disproportionate share of the job openings. The turnover rate in retail is 4.8 percent, which means that close to 30 percent of jobs will come open in the next six month. In restaurants the turnover rate is 5.4 percent, meaning close to one-third of the jobs will come open in the next six months. This suggests that an employer is not taking much of a risk by hiring in this time of uncertainty.

Dean Baker / June 17, 2014

Article Artículo

Questions for Janet Yellen's June 18 Press Conference

With the U.S. Senate confirming three Federal Reserve Board governors since last month, following three resignations this year, there will be a new mix of voices at the Fed's Open Market Committee meeting this week.

Last week, the Brookings Institution released Janet Yellen's Dashboard, featuring charts illustrating several of the "most important measures of the economy's vigor" -- for example, that the unemployment rate remains above, while the inflation rate remains below, the Fed's targets.

CEPR and Nicole Woo / June 16, 2014