Dean Baker
Al Jazeera English, January 11, 2012

As media coverage intensifies around the two-year anniversary of the earthquake in Haiti, there appears to be a serious effort on the part of the largest donors and aid organizations to present the relief and recovery in Haiti as an unmitigated success. One notable exception is Oxfam, which released a two-year report critical of the reconstruction effort.  The State Department, on the other hand, issued 11 separate fact sheets on the U.S. response in Haiti; none of them suggested that the U.S. had learned from its mistakes, or indeed that any mistakes had been made at all. One of the key statistics that is most frequently touted to suggest that big advances have been made is the decline in the number of internally displaced persons (IDPs) living in camps.  In a State Department blog post (also published on the Huffington Post) Cheryl Mills, chief of staff to Hillary Clinton, points to the reduction of IDP numbers as a clear sign of progress:

Almost two-thirds of the estimated 1.5 million Haitians living in tent shelters after the January 2010 earthquake have left camps, many returning to houses that have undergone structural improvements or moving into temporary shelters and permanent homes.

Of course, a reduction in people living in IDP camps seems like an entirely positive development. Yet a closer look at this development reveals significant problems with both the relief and reconstruction effort and a much more tepid success story.

In March, the International Organization for Migration (IOM), which tracks the IDP camp population, found that there were 680,000 people living in the camps. So by March the majority of the decrease Mills cites had already taken place. Yet what the IOM found was that many people were leaving the camps for even more precarious living situations, not for new homes or T-shelters. The IOM study shows that only seven percent indicated that an "assistance package was provided" (2.0%), "my home was repaired" (4.7%) or "transitional shelter was provided" (0.3%) as reasons for leaving IDP sites. On the other hand, "Poor conditions in the IDP site", "eviction", "high incidence of crime/insecurity in the IDP site", and "rain/hurricane" were cited by 77.9 percent of respondents. Between June 2010 and March 2011, some 230,000 people were evicted from IDP camps and more than 100,000 still face the constant threat of eviction.

In his latest New York Times Magazine column, "The Other Reason Europe Is Going Broke," Adam Davidson writes, "One great way to start a bar fight during an American Economic Association conference is to claim that the U.S. economy is preferable to Europe's. Someone will undoubtedly start quarreling about how GDP per capita doesn't measure a person's happiness."

NPR's Planet Money blog asked Dean Baker, co-director of the Center for Economic Policy Research, to explain why GDP per capita, the total GDP of a country divided by the number of people in the country, is such a controversial measure. This post originally appeared there.

The gap in per capita income between the United States and Europe is striking, but these numbers do not tell the whole story in comparing living standards There are three important issues to keep in mind.

First, there are some very big measurement issues in international comparisons of GDP. At the top of this list, I would put our spending on health care. We spend 17 percent of GDP on health care, whereas the average across Europe is less than 10 percent GDP. What do we get for this extra 7 percentage points of GDP? That is not obvious to say the least. The U.S. ranks behind every West European country in life expectancy and does not stand out in most other outcome measures.

There are also important areas of spending that don't directly improve living standards. The United States spends more than 4.0 percent of GDP on the military as opposed to less than 1.0 percent across Western Europe. One can argue whether this spending is necessary, but this is another 3.0 percent of GDP that is not improving living standards. The same applies to spending on criminal justice, which is more than 1.5 percent of GDP in the United States and perhaps one-tenth this amount across Western Europe.

Mark WeisbrotThe Guardian Unlimited, January 10, 2012

Dean Baker
Truthout, January 9, 2012

Natural gas companies are trying to sell fracking as the solution to all of the economic ills ailing this country.  Supposedly fracking can bring the economy out of its current stagnation by creating uncountable new jobs, without running up government deficits, and even save us from global warming in the process.  So how come local residents and environmentalists oppose fracking? The short answer is that fracking does not create local jobs, it lowers property values, and pollutes the water we drink and the air we breathe.

Hydraulic fracturing, or fracking for short, is drilling for gas buried more than a mile under ground in hard rock layers. In order to extract the gas, a toxic cocktail of chemicals is pumped deep into the ground to fracture the rock. In recent years, the state of Pennsylvania has embraced the fracking boom and more than 4,500 wells have been drilled there since 2007. The state of New York has taken a more prudent approach by implementing a moratorium until the environmental and economic effects have been evaluated. The New York Department of Environmental Conservation is currently seeking public comments on the issue (deadline January 11).

In an intensive lobbying campaign to influence a skeptical public’s opinions about fracking, the gas industry has commissioned a number of economic studies that find huge job gains from fracking. A recent study by the economic forecasting company IHS Global Insight Inc., paid for by the America’s Natural Gas Alliance, projects that fracking will create 1.1 million jobs in the United States by year 2020. However, a closer read of the study reveals that the analysis also projects that fracking will actually lead to widespread job losses in other sectors of the economy, and would result in slightly lower overall employment levels the following 10 years, compared to what it would be if fracking were restricted. In another study, commissioned by the Marcellus Shale Coalition, researchers with Penn State University estimated that gas drilling would support 216,000 jobs in Pennsylvania alone by 2015. The most recent data from the Bureau of Labor Statistics show employment in the oil and gas industry to be 4,144 in Pennsylvania.

Rather than trying to project what will happen in the future, one could look at what the employment impact has been from Pennsylvania’s love affair with fracking since 2007, using actual employment data readily available from the Bureau of Labor Statistics.