Transitioning to Geocratia — the People and Planet and Not the Market Paradigm — First Steps

Parting from the fact that saving Planet Earth, our home, changes everything, we need to build a new ethos where the majority of humankind commits to a system whose only purpose is the pursuit of the welfare of people and Planet Earth. This requires that all Earth resources necessary for the enjoyment of life of all living things be managed to achieve true long-term sustainability. — Álvaro J. de Regil

Capitalism of Dispossession in the Palm Oil Plantations in the Countries of the Global South

The commodification of land has deepened the ecological, social and economic crises. The unprecedented global pandemic of the covid-19 virus comes from the destruction of the habitats of species of wild animals and plants and the subsequent migration to humans. The neoliberal model is unsupportable in the sustainable conservation of nature and the planet's economy. A change in the capitalist economy is urgently needed. — Nubia Barrera Silva

The Common Places of Environmental Scepticism

The challenge posed by the ‘limits to growth’ runs beyond the level of ordinary political debate, pointing to a crisis of philosophical anthropology: who are we, and how should we live, if we now believe that progress will not continue forever?— Richard Douglas

The Contagion of Capital

The U.S. economy and society at the start of 2021 is more polarised than it has ever been. The wealthy are awash in a flood of riches, marked by a booming stock market, while the underlying population exists in a state of relative, and in some cases even absolute, misery and decline. The result is two national economies as perceived, respectively, by the top and the bottom of society: one of prosperity, the other of precariousness. At the level of production, economic stagnation is diminishing the life expectations of the majority. At the same time, financialisation is accelerating the consolidation of wealth by a very few. Although the current crisis of production associated with the COVID-19 pandemic has sharpened these disparities, the overall problem is much longer and more deep-seated, a manifestation of the inner contradictions of monopoly-finance capital. Comprehending the parameters of today’s financialised capitalist system is the key to understanding the contemporary contagion of capital, a corrupting and corrosive cash nexus that is spreading to all corners of the globe, and every aspect of human existence. — John Bellamy Foster, R. Jamil Jonna and Brett Clark

COVID-19 and Catastrophe Capitalism — Commodity Chains and Ecological-Epidemiological-Economic Crises

COVID-19 has accentuated as never before the interlinked ecological, epidemiological, and economic vulnerabilities imposed by capitalism. As the world enters the third decade of the twenty-first century, we are seeing the emergence of catastrophe capitalism as the structural crisis of the system takes on planetary dimensions. — John Bellamy Foster and Intan Suwandi

An Eco-Revolutionary Tipping Point?

Just a couple decades ago, we were told that neoliberal capitalism marked the “end of history.” Now it appears that the system’s ideologues may have been right, but not in the way they envisioned. The system of fossil-fuelled neoliberal capitalism is indeed moving toward an end of history, but only in the sense of the end of any historical advance of humanity as a productive, political, and cultural species due to the increasingly barbaric socio-economic and environmental conditions the system creates. There is now no alternative to the end of history as we know it. — Paul Burkett

Marxism and Ecology: Common Fonts of a Great Transition

This essay unearths the deep ecological roots of Marx’s thought, showing how he brought an environmental perspective to bear on the overarching question of social transformation. From there, it traces the evolution of Marxian ecology, illuminating its profound, formative link to modern ecological economics and systems ecology. It concludes by discussing the wider project of building a social movement broad and deep enough to halt and reverse ecological and social destruction. — John Bellamy Foster

(Un)witting Servitude and Minds Manipulation

Despite the profound crisis of the capitalist system, which is now more evident than ever in all aspects of social and individual life, there is no organised anti-establishment reaction from the majorities nor a rigorous and coherent discourse. A messenger, without populist or opportunistic concessions of a revolutionary ideal, is conspicuously absent. The collapse of real socialism and the fictitious and corrupt “socialism of the 21st century” have also contributed to a conditioned rejection of the idea of a socialist transformation of society. With this combination of circumstances, and on the basis of the almost absolute control of the instruments and means of production and communication, the latter with a practically unlimited capacity for the manipulation of minds, the dominant system is winning the battle. We hope that, sooner rather than later, this balance of power, which is disastrous for the future of humanity, will radically change. — Alejandro Teitelbaum

Democracy, Condocertism and Popular Participation

Parting from the fact that the Anthropocene has pushed us beyond the limits of Mother Earth’s resilience, it is urgent to impose strict rules in order to curb the overflowing anthropic impact that is leading us towards an unknown that appears, alas, sadly known to us. It is in this context—the imposition of insuperable limits—that politics becomes fundamental. At first glance, the most appropriate political form to impose strict rules is any form that allows for a more centralised power. However, the new society must be established by deliberation, not by imposition. In this sense, it is democracy that these pages will deal with; trying also to overcome the dispute between representative and direct democracy. I advocate for the proportional system, considering it the maximum representation of elective democracy. — Andrea Surbone

Ethnic-Peasant Resistance iin South America and Meso America to the 4.0 Agriculture of Catastrophe Capitalism

The ethno-peasant economy extended to indigenous peoples in voluntary self-isolation leads to the concept of Mother Earth. This is incompatible with agriculture 4.0 of the Global North in South America and Mesoamerica in areas of territorial expansion towards the Pan-Amazon Region made up of nine countries: Brazil, Venezuela, French Guyana, English Guyana, Suriname, Colombia, Ecuador, Peru and Bolivia. These peoples have full respect for and dependence on land, water, air and forests as sources of life. Unlike the concept of Western economic growth with its linear and fragmented approach, the integral vision of the natural economy, as Karl Marx said, is about "living well" and is on the opposite side from the passions and feelings of greed that emerge from the unlimited accumulation of transnational landowning capital. — Nubia Barrera Silva

The Dictatorship of Financial Capitalism

Capitalism, in its current configuration as the global dictatorship of finance capital, is committing crimes against humanity and devastating the planet. "What is the robbing of a bank compared to the founding of a bank?" (Bertold Brecht) — Alejandro Teitelbaum

Life Beyond Capital

People’s everyday lives are lived among the particular people and places that matter to them. They still live lives outside the ever expanding domains of capital. Our environmental and social crises require not the expansion of the worlds of capital, but resistance to that expansion and the growth of spheres of life beyond capital. — Jim O'Neill

Marx's Open-Ended Critique

Two hundred years after Karl Marx’s birth, the influence of his critique of capital is now as great as ever, in the context of what has been called the “Marx revival.” The “greatness” and “vitality” of Marxian social science that Schumpeter notes derives primarily from its inner logic as a form of open-ended scientific inquiry. Against attempts in the dominant ideology to characterise Marx as a rigid, dogmatic, deterministic, and closed thinker, it is precisely the open-endedness of his “ruthless criticism of all that exists”—an open-endedness inherently denied to liberal theory itself—that accounts for historical materialism’s staying power. This openness can be seen in the Marxism’s ability constantly to reinvent itself by expanding its empirical as well as theoretical content, so as to embrace ever larger aspects of historical reality in an increasingly interconnected world. — John Bellamy Foster

The Long Ecological Revolution

In the long ecological revolution before us, the world will necessarily proceed from one earthly struggle to another. If the advent of the Anthropocene tells us anything, it is that humanity, through a single-minded pursuit of economic gain benefitting a relative few, is capable of producing a fatal rift in the biogeochemical cycles of the planet. It is time therefore to find another path: one of sustainable human development. This constitutes the entire meaning of revolution in our time.— John Bellamy Foster

The Anthropocene Crisis

Bellamy Foster points at the rather evident and urgent need to replace and not fix capitalism, so that we can aspire to "rebuild the house of civilization under different architectural principles, creating a more sustainable metabolism of humanity and the earth. The name of the movement to achieve this, rising out of the socialist and radical environmental movements, is ecosocialism, and Facing the Anthropocene is its most up-to-date and eloquent manifesto." — John Bellamy Foster

Labour Value Commodity Chains — The Hidden Abode of Global Production

As in V. I. Lenin’s conceptualisation, imperialism can be broadly defined as the complex intermingling of economic and political interests, related to the efforts of large capital to control economic territory. Imperialism has several interrelated aspects: (1) geopolitical (including military) struggle by nation-states for positions within the international hierarchy of the system, encompassing the control of colonies or neo-colonies, (2) dispossession of petty producers outside of capitalist production, and (3) global exploitation (along with expropriation—or appropriation without an equivalent) of labour in capitalist production, particularly under the domination of multinational firms emanating primarily from the core of the system. This work focuses almost entirely on the third aspect, without in any way denying the significance of the other two. — Intan Suwandi

Capitalism Has Failed — What Next?

To say that capitalism is a failed system is not, of course, to suggest that its breakdown and disintegration is imminent. It does, however, mean that it has passed from being a historically necessary and creative system at its inception to being a historically unnecessary and destructive one in the present century. Today, more than ever, the world is faced with the epochal choice between “the revolutionary reconstitution of society at large and the common ruin of the contending classes.” — John Bellamy Foster

Imperialism in the Anthropocene

Capitalism promotes a “madness of economic reason” that can be seen as undermining the healthy human metabolic relation to the environment. The mere critique of capitalism as an abstract economic system, however, is insufficient in addressing today’s environmental problems. Rather, it is necessary also to examine the structure of accumulation on a world scale, coupled with the division of the world into competing nation-states. Our planetary problems cannot realistically be addressed without tackling the imperialist world system, or globalised capitalism, organised on the basis of classes and nation-states, and divided into center and periphery. Today, this necessarily raises the question of imperialism in the Anthropocene. — John Bellamy Foster, Hannah Holleman and Brett Clark

When Did the Anthropocene Begin… and Why Does It Matter?

The term Anthropocene…suggests that the Earth has now left its natural geological epoch, the present interglacial state called the Holocene. There is a reciprocal process here. Examining social, economic, and political developments can help identify social changes that might have changed the Earth system, and determining when radical physical changes in the Earth system happened provides a basis for determining which human activities were responsible, and thus what measures humans might take to prevent the change from reaching catastrophic proportions. In this article I offer an overview of the issues and stakes in the “when it happened debate. — Ian Angus

Invisible Exploitation — How Capital Extracts Value Beyond Wage Labour

Capitalists have always used more than the wage form alone to extract surplus product from workers. However, this century is particularly distinguished by its growing reliance on alternate methods of extracting surplus. It’s time for Marxists to rethink our preoccupation with the wage and develop a theory encompassing a common ground of exploitation across a wide variety of extractive relations under capitalism. A recognition of that shared exploitation may prove key if the exploited “class-in-itself” is to become a “class-for-itself,” able to unite and act in solidarity. — Eva Swidler

The Underlying Causes of Immigration from Mexico to the United States

This paper focuses on the underlying causes of immigration from Mexico to the United States from a political and socio-economic viewpoint. However, the root causes behind the flows of emigrants in other regions of the world are consistently the same. They result from the impact of powerful geo- political interests on the general population of both the emitting and the receiving countries of the millions of migrants in their escape from unbearable conditions and in pursuit of a dignified life. From this perspective, we will uncover and review the underlying causes of immigration from Mexico to the US, which are structural, in an effort to shed light onto their real solution. — Álvaro J. de Regil

To Die for Wall Street — Coronavirus, Social Classes and the Prevailing Culture

The COVID-19 epidemic has clearly revealed the process of decomposition—progressively accelerated over the past half century—of the capitalist system in its political, economic, social and cultural aspects. The leading political elites that presented themselves as—and long ago were to a certain extent—mediators between the economic power and society, have ceased to be so and, with nuances, are now simply transmission belts of real power: towering financial, industrial and commercial capital. — Alejandro Teitelbaum

The Case for Basic Income

The COVID-19 pandemic has brought into sharp relief the irretrievable breakdown of the post-war income distribution system in the West that essentially ties income and benefits to employment. The past four decades have seen income, wealth, and power flowing increasingly to rentiers—owners of physical, financial, and so-called intellectual property—while the ranks of the global precariat swell, consigning workers to unstable jobs, low and erratic incomes, and insecure lives. But the pandemic may prove the undoing of that system, as paying people to stay home—indeed, to not do paid work—has become essential to survival. — Guy Standing

What are we saying when we talk about sustainability? — An Ecological Political Proposal

If you consider 1987 (the Brundtland Report) as the official beginning of the idea of sustainability, the term has made a brilliant journey of almost three decades and is still alive. In its evolution, it has become at the same time a concept, paradigm, theoretical framework, technical instrument, utopia, pretext, ideology and many other things, but above all it has become the word that contains a vague desire of the educated and privileged masses of the planet for a better world in which the human race rediscovers itself ideally with nature and with social justice. Beyond the ideological dimension, and its multiple and ungraspable interpretations, this essay focuses on sustainability as a scientific concept that springs from an interdisciplinary vision of reality, and that for many authors achieves the status of a new paradigm. — Víctor M. Toledo

The Post-Growth Challenge

Critics have long questioned the feasibility (and desirability) of exponential growth on a finite planet. More recently, mainstream economists have begun to suggest some ‘secular’ limits to growth. Sluggish recovery in the wake of the financial crisis has revived discussion of a ‘secular stagnation’ in advanced economies, in particular. Declining growth rates have in their turn been identified as instrumental in increased inequality and the rise of political populism. This paper explores these emerging arguments paying a particular attention to the dynamics of secular stagnation. It explores the underlying phenomenon of declining labour productivity growth and unpacks the close relationships between productivity growth, the wage rate and social inequality. — Tim Jackson

Work and Unionism in Mexico: Challenges for MORENA and the Fourth Transformation Government

The 4T government unleashes both strong fears and hopes depending on the point of view. In this article we will only discuss the prospects for workers and unions. We start, first, by discussing the labour insurgency and strikes in the first few months of 2019 and their results. Next we briefly discuss the principal changes to the labour legislation approved, meaningfully, on 1st of May of the same year. Finally, we offer a preliminary assessment of real wages and labour conditions in Mexico during the first six-to-nine months of 2019 compared with earlier years. We then outline some questions for future research, highlight the absence of an explicit labour policy of the 4T government and outline some challenges for the labour movement. — Enrique de la Garza Toledo and Gerardo Otero

The Preemptive Counterrevolution and the Rise of the Far Right in Brazil

Will the left be capable of radically altering the political course it is currently on, which is mostly relegated to institutions and elections? If, throughout the twentieth century, the epicentre of the left’s actions was institutional and parliamentary action, the biggest challenge in this period will be found elsewhere, somewhere different from that which has dominated and exhausted the left until now. It is imperative to reforge the organic ties between the labor and social movements, with their mosaic of multiple tools and without previous hierarchical structures, taking as a starting point the concrete actions of the working class. If we are on the side of reason and revolution,an indispensable beginning is to ascertain, in a Lukácsian way, what are the vital questions of our time if we want to walk together, in solidarity, toward a new, emancipated way of life. — Ricardo Antunes

A Tale of Two Utopias: Work in a Post-Growth World

In this paper, we aim to contribute to the literature on post-growth futures. Modern imaginings of the future are constrained by the assumptions of growth-based capitalism. To escape these assumptions we turn to utopian fiction. We explore depictions of work in Cokaygne, a utopian tradition dating back to the 12th century, and William Morris's 19th century News from Nowhere. By breaking the link between work and consumption at the level of the individual, we can remove some of the coercion in work. This would free us to do jobs that contribute to the social good, rather than generate exchange value, and empower us to fight for good work. Finally, we draw on eco-feminist analyses of capitalism to argue that by challenging labour productivity growth we can also challenge wider forces of oppression. — Simon Mair, Angela Druckman and Tim Jackson

Unequal Exchange

This Brief assesses economist Arghiri Emmanuel's theory of Unequal Exchange, to delve, from an economic analysis angle, into TLWNSI's central argument: that we endure a North-South system of exploitation, which, among other features, has a direct and premeditated impact on the misery wages paid in all countries in the South. This unequal exchange constitutes a trade imperialism that historically has generated vast earnings for the North, greater than the interests recovered by banks and the profits obtained by transnationals. — Claudio Jedlicki

Keynesian Economics and the Welfare State

This work explains in detail the emergence of the new Keynesian economic paradigm as a consequence of the experience of the Great War and the Great Depression and the results obtained through government intervention during the New Deal. The goal here is to show how the post-war era, with the government in the driver's seat of the economy, provided the greatest period of progress in the welfare of both rich and poor nations, in spite of the very powerful interests that continuously moved in the opposite direction. The essay opens by stating that the war economy pulled the capitalist world out of depression. — Álvaro J. de Regil

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Research and analysis to provoke public awareness and critical thinking

We contribute to the liberalisation of the democratic instituions of society, for they have been captured by the owners of the market. They work in tandem with their market agents, who, posing as public servants, are entrenched in the halls of government. The political class has betrayed its public mandate and instead operates to impose a marketocratic state to maximise the shareholder value of the institutional investors of international financial markets. They own the global corporations and think they own the world on behalf of their very private interest.

Our spheres of action: true democracy – true sustainability – living wage – basic income – inequality – ecological footprint – degrowth – global warming –human development – corporate accountability – civil, political, economic, social, cultural and environmental rights, responsible consumption, sustainable autonomous citizen cells...

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Parting from an ethos of true democracy and true sustainability, We, the citizenry, work to advance the paradigm whose only purpose is to go in pursuit of the welfare of People and Planet and NOT the market.

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2020 Report: Living-wage assessment – PPP Wage rate gaps for selected "developed and emerging" economies for all employed in manufacturing workers (1996 up to 2018).

Our 2018 assessment reports divergent outcomes among selected economies that were predominantly the result of a meaningful increase of hourly wages in local currency (or lack of it), exchange rates and changes in their PPP cost of living. Six economies improved their position, four lost ground and four did not change. France, Germany, Italy, South Korea, Singapore and Australia improved their equalisation index (Eq-Idx). Canada, United Kingdom, Spain and Turkey lost ground compared to their 2017 position, whilst Brazil, Mexico, Japan and South Africa experienced no change.

Among the six economies that improved their living-wage equalisation position, the main factors were the substantial increase of their hourly rates in local currency combined with a revaluation of their currency or a decrease in their cost of living in PPP terms for private consumption. In the case of the three euro-area countries (France, Germany and Italy), it was specifically the combination of the increase of their hourly wage rates with a revaluation of the euro. This allowed France, Italy and Germany to increase their equalisation Eq-Idx. This combination served to offset their increase of their PPP cost of living, and increased their advantage over the increase of the US hourly rates in real terms. A similar behaviour took place in the case of Singapore and South Korea. In this way, they clearly outperformed the increase of the US hourly rate in manufacturing and thus increased their equalisation Eq-Idx In fact, Singapore’s Eq-Idx is its best recorded since 1996. Australia, in contrast, devalued its currency, but it achieved the highest improvement of its equalisation Eq-Idx among all 41 economies in our reports, which is equal to its best position previously achieved in 2014. This was the result of a strong increase of its hourly rate in local currency and a currency devaluation, which contributed to a drop of its PPP cost of living.

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2020 Report: Living-wage assessment – New assessment of Argentina's wage rate gap 1996-2018

Our analysis of Argentina’s living wages in the manufacturing sector from a global perspective (purchasing power parities) no longer assumes that Argentina’s government will continue to regard the appreciation of real wages as a fundamental element of its economic policy. As expected, the Macri government did everything possible to resume the old centre-periphery relationship that applies a neocolonial ethos to Argentina’s economic policies. Unfortunately, his economic policies have proven disastrous, and in his four years, inflation and devaluation have exploded, the country fell into default of its sovereign debt, real wages collapsed and poverty increased very meaningfully. One clear direct consequence is that the equalisation indices for at least the 2018 - 2020 period will drop dramatically, from 50 in 2017 to low to mid 30s, which is tantamount to the levels prevalent during the 1996 - 2000 period.

After the staunchly neoliberal Macri government left Argentina’s socio-economic conditions in dire shambles, the new Fernández government is doing its best to recover the gains for the common citizen of the preceding Kirchner-Fernández governments, which will be a rather daunting task, given the recurring crises since the start of this century. For now, living wage equalisation in the manufacturing sector vis-à-vis equivalent US wages has collapsed and is destined to drop to levels reminiscent of the 2002 crisis before it begins to recover.

The new government of Alberto Fernandez immediately implemented a countercyclical package to return to demand-side policies aimed at reducing as much as possible Macri’s neoliberal ethos and his economic policy errors. Some of these are tax hikes on foreign currency purchases, agricultural exports, wealth, and car sales as well as labour protections to increase compensation for unjustified work dismissals. Also, as it happened at the start of the century, Argentina was forced to default on its foreign debt, and has just reached an agreement with vulture funds and other foreign creditors that, for the most part, fulfils their demands and not those of Argentinians. Moreover, Argentina is once again under negotiations with the IMF to reduce its never ending sovereign foreign debt. Furthermore, the economic crisis has been convoluted by the COVID-19 pandemic, which will clearly exacerbate Argentina’s deep recession. So far, inflation appears to be substantially lower in 2020 than in 2019, at 13,5% for the first six months, but expected to hover at 30% by the end of the year, despite the effect of the pandemic on an already depressed demand. As with the rest of the world, GDP will fall drastically, at least 11% and then gradually recover, more as a technical rebound rather than as true growth in 2021. All of these factors will make it difficult for Argentina to recover real wages in manufacturing and gradually bring them to their previous equalisation position relative to the 2002 crisis.

Parting from this rather negative context, the socio-economic picture for Argentina looks a lot like a loss of two decades. This would entail a colossal hardship particularly for the lower ranks of society. One of the greatest benefits of the appreciation of real wages of any country –in the context of a living wage ethos in a market society– is the direct impact on the eradication of the conditions of inequality and exclusion; conditions that have prevailed in Argentina for many decades and were only reduced substantially between 2004 and 2015. It remains to be seen if the new government is capable of performing a successful balancing act between the different variables in an extremely complex scenario.


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2020 Report: Living-wage assessment – New assessment of Brazil's wage rate gap 1996-2018

Temer’s supply-side economic policies that continues with Bolsonaro’s government, have stopped any effort to improve the labour’s share of income and clearly reflect a policy of deliberate wage contention. Temer’s government passed a new law (PEC 55) that freezes all public spending for 20 years, which implies that constitutionally-protected government expenditures in the areas of health, education and other social sectors would remain stunted until 2036. This has ended Brazil’s commitment to sustain its minimum wage appreciation policy, after the minimum wage had more than doubled in real terms since 1996. As for manufacturing wages, they actually lost ground since 1996, which partially recovered from the recession at the start of the century, until the minimum wage appreciation policy had a positive influence from 2010 onwards that is now receding once again. Yet, with a renewed recession during the 2014-2016 period, that only began to subside in 2017 and will fall back into a deep recession due to the ongoing COVID-19 pandemic, and the staunchly neoliberal and predatory supply-side approach followed by Bolsonaro’s government, Brazil will not resume any gains in real terms from a domestic perspective nor will it resume the closing of its Eq-Idx, from a global perspective, for the foreseeable future. In fact, it is likely to actually increase its equalisation gap with comparative wages in the US in the coming years.

For the entire 24-year period (1996-2018), living wage equalisation of manufacturing hourly wages have not made any improvement whatsoever, and they are slightly lower than in 1996. The hourly rates recovered gradually after the turn of the century recession but by 2018 their equalisation with equivalent US wages are down to a 32 index relative to the 34 index of 1996. Our estimate for 2019, indicates that their Eq-Idx would drop to 31 as the result of a meagre increase estimate in local currency, the actual erosion of the BRL and an increase of the PPP cost of living in local currency. The compounding effect of Bolsonaro’s government predatory economic policy that is clearly anti-labour and the COVID-19 pandemic, make any change for the better rather unlikely for the foreseeable future. Hence, the prospect for living wage equalisation appears grim.

Parting from the implications carried by the shift from demand-side to supply-side economic policy in Brazil’s current government, it appears to be unlikely that any meaningful progress will be achieved in increasing manufacturing wages and wage rates for the entire economy in real terms. In the best case scenario, wages will keep their current value. All of this is further complicated by the deep recession triggered by the pandemic.

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Textile Sweatshops in the US
Textile Sweatshops in the US
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Living-wage assessment – Table T5: 1996-2018 Real wage-gap rates for fourteen selected economies, in purchasing power parity (PPP) terms, for all employed in manufacturing. *(The base table used for all PPP real-wage gap analysis)

Our 2018 assessment reports divergent outcomes among selected economies that were predominantly the result of a meaningful increase of hourly wages in local currency (or lack of it), exchange rates and changes in their PPP cost of living.

Germany continues to have the best position with an increasing equalisation advantage over the US in real PPP terms in its hourly wage rates, followed by France with a four-point advantage over US wage rates. All other countries continue to record wage gaps vis-à-vis equivalent manufacturing wage rates in the US. Six out of the twelve countries improved their position in 2018 vis-à-vis 2017 by increasing their advantage (Germany and France) or decreasing their wage gaps (Italy, Singapore, South Korea and Australia). Brazil and Mexico remained with the same gap since 2016. Only Canada, the United Kingdom, Spain and Turkey increased their gaps from the previous year. Mexico and Brazil continue reporting the greatest wage gaps.

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2020 Report: Living-wage assessment – New assessment of Mexico's wage rate gap 1996-2018

The staunchly predatory, corrupt and fraudulent governments of Mexico, imposed a policy of wage erosion and containment at an extremely precarious level in manufacturing and all economic sectors, as one of the pillars of their economic policy for nearly 36 years. With the current government, this appears to be changing.

Mexico’s track record since 1996 exposed a deliberate state policy of maintaining modern-slave-work real wages between 1996 and 2015. However, their wage policy appears to have changed in 2017 after the execution of consistent supply-side policies over more than three decades. For the first time the federal minimum wage was increased above inflation in 2017 and 2018. Through a so-called “Independent Recovery Amount”, the minimum wage for 2017 was increased arbitrarily by 9,6%, including 3,9% to offset the estimated CPI inflation rate. The same criterion was applied for 2018, for a total minimum wage increase of 10,4%, including a 3,9% increase to offset CPI inflation. In 2019, Mexico’s new government, vowing to implement a strong minimum wage recovery policy, increased the minimum wage by 16,2%, including a 5% increase to offset inflation and by 20% in 2020, including 5% to account for inflation. This changes appear to have a direct positive impact on manufacturing wages in real terms and on its equalisation with comparative US wages. Between 2015 and 2018 the manufacturing hourly rate in local currency increased 43,6%, and by 18,3% in US dollars after accounting for an erosion of the peso, which allowed the PPP conversion factor for private consumption to drop. The combination of these components allowed the Eq-Idx to gain five points in 2016 and then remain at this level in 2017 and 2018.

After two years, it remains to be seen if the government follows this path or resumes abiding by supply-side criteria. Mexico has the worst wages in Iberian America. We have observed 36 years of a deliberate policy of wage pauperisation that has forced a huge population to join the ranks of the precariat. While minimum wage policy appears to be moving on the right track, there are many instances of public matter with the government clearly siding with the interest of capital and not with the people. If, at the end, the labour’s share of income does not improve steadily and shows a marked increase by the end of 2024, we would have to conclude that the only goal of the government was to mitigate the worst characteristics of exploitation and not to change the structures that sustain them.

On the other hand, if the government complies with its campaign promises, it will take decades to both achieve a living-wage ethos and to close the gap with equivalent wages in the manufacturing sector, under the equal pay principle. At the very least, it will take five six-year terms to fulfil this expectation under the presumption that the current government sets the path and materialises the progress that can be achieved by 2024, as illustrated in our projections.

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2020 Report: Living-wage assessment – New assessment of Spain's wage rate gap 1996-2018

In 2018 Spain widened the gap of its equalisation index (Eq-Idx) after a meaningful four-point gain in 2017. The increase in its gap was largely the result of the combined effect of a drop of its hourly rate in euros and a meaningful increase of its cost of living in purchasing power parity terms, with the latter being in turn a consequence of the revaluation of the euro for the most part, since consumer prices increased less than two percent.

Since Spain joined the €uro area, hourly manufacturing wage rates generally performed better than the minimum wage, with rates consistently moving above CPI inflation, whilst the minimum wage increased at lower rates and lost value in real terms between 2001 and 2004. It was only until 2017 and 2018 that the minimum wage outperformed manufacturing wages in real terms relative to CPI inflation, ending 16% above the CPI versus only 9% for the manufacturing hourly rate. Undoubtedly, Spain’s minimum wage will greatly outperform manufacturing wages in 2019 and 2020. We will see to what extent manufacturing wages are influenced by the pressure exerted by the increases to the minimum wage when the hourly manufacturing rates become available. The government has pledged to push for powerful increases to the minimum wage in the next three years for a total increase of 26% by 2023. Yet mounting opposition from employers already forced them to increase the rate in 2020 at half of what they pretended. According to the government, the 2019 minimum wage of Spain was still below the average for the rest of Europe at 80,6%. For now, inflation has not been impacted whatsoever by the unprecedented minimum wage increase. As for unemployment, it continued to drop in 2019, from 26% in 2013 to 13,8% by the end of 2019. But, as could be expected, by second quarter 2020, it has climbed to 15,3% as a result of the COVID-19 pandemic.

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Living-wage assessment (1996-2018) twenty-eight European economies.

For the 28 European economies in our reports, far more economies increased their Eq-Idx with equivalent hourly wages of US workers than experienced a set back in 2018. As in the vast majority of cases
in the 41 economies included in all our reports, our assessment among European economies found divergent outcomes that were predominantly the result of a meaningful increase of hourly wages in local currency (or lack of it), combined by the behaviour of their exchange rates and their cost of living in purchasing power parity terms for private consumption.

The best performers in increasing their Eq-Idx among European economies in 2018 were Estonia (+6), Ireland (+4), Romania (+4) and Slovakia (+4), whilst the major under performers were Switzerland ((-7) and Hungary (-5). All European economies that improved their living wage equalisation index (Eq-Idx) with equivalent US workers, was primarily the result of significant increases of their hourly compensation wage rates in local currencies—vis-à-vis the US hourly wage rate increase of 1,8%— combined with the revaluation of the euro (4,79% or their national currency). This clearly offset their increase in their PPP cost of living and produced increases of their Eq-Id., Conversely, practically all under performers that widened their wage gap with US hourly compensation wage rates, increased their hourly rates in local currency less than the US hourly rate of +1,8% or actually decreased their hourly rate: Croatia (-1,4%), Hungary (-8,1%), Spain (-0,6%), Switzerland (-7,8%) and UK (+0,7%). Lithuania was one exception due to a high increase of its cost of living (+6,7%) despite its hourly rate increase of 2,6%, and Turkey that suffered a steep devaluation of 24,4% that offset its hourly rate increase of 13,2%.

•Among the 16 euro-zone economies, nine increased their Eq-Idx, Austria, Belgium, Finland, the Netherlands and Portugal did not change and Lithuania and Spain widened their living-wage gap. The combination of the same variables described above for all Europe drew similar results in euro-zone countries: (1) a meaningful increase in the hourly compensation wage rate in local currency (averaging 4,5%), combined with (2) the significant revaluation of the euro against the dollar of 4,8%, were sufficient in most cases to offset the increase in their PPP for private consumption cost of living (averaging 4,9%) and the increase of 1,8% of the US hourly wage rate. This resulted in a 9,5% average increase in the hourly rate of the 16 euro economies in US dollars. Some economies experienced extremely strong increases of the hourly rate in local currency. Estonia recorded the strongest increase at 17,8% in local currency —which translated into a 23,5% increase of its hourly rate in US dollars and on its Eq-Idx, equivalent to a six-point gain, from 43 to 49— followed by Slovakia at 16,8% and Ireland at 11,4% in US dollars. Only Spain and Lithuania increased their living wage gaps due to increases of 4,1% and 7,5% in US dollars that were offset by increases of their PPP cost of living of 5,9% and 6,7%, respectively.

•Among the 12 Eastern European economies, including the euro-zone economies of Estonia, Latvia, Lithuania, Slovakia and Slovenia, a marked improvement in their Eq-Idx is evident as a continuation of a powerful trend that has been closing the Eq-Idx gap since 1996, with Bulgaria, Estonia, Lithuania, Romania and Slovakia, more than doubling their 1996 Eq-Idx. The best performers in 2018 were Estonia (+6), Romania and Slovakia, with 4 points each, and The Czech Republic and Poland with 3 points each. Overall, performance was very positive for the 12 economies, once again as a result of the combination of the same variables with the same behaviour: (1) a strong increase in the hourly compensation wage rate in local currency (averaging 7,6%), (2) small change in their PPP for private consumption cost of living (averaging 3,7%), (3) a meaningful revaluation of their currencies against the dollar of 2,3%, which resulted in a strong increase of their wage rates in US dollars (averaging 9,8%), enough to offset the 1,8% increase of the US wage rate and thus increase the Eq-Idx for eight of the 12 economies. If we exclude the euro-zone economies in Eastern Europe, the gains are also considerable for Bulgaria (+1), Czech Republic (+3), Poland(+3) and Romania (+4), Conversely, Croatia, Hungary and Turkey lost ground, with Hungary recording the worst performance as the result of the steep drop of its rate in local currency (-8,1%) and increase of PPP (3,4%) and small revaluation of only 2,6%, which resulted in a drop of 6,6% in its US dollar rate and a loss of 5 points in tis Eq-Idx. Turkey recorded a steep devaluation of 24,4% but its hourly rate increase of 13,2% and the drop of 14,4% in the PPP cost of living allow it to lose only one point in its Eq-Idx.

•The United Kingdom lost two points in its Eq-Idx due to little change in its local currency wage rate (0,7%) and an increase of 4,2% of its PPP despite a 3,7% pound revaluation. Surprisingly, Switzerland recorded the worst performance in all of Europe due to a steep drop of its hourly rate in local currency of -7,8% and little change of its exchange and PPP rates, which resulted in a drop of -7,2% of its rate in US dollars and a loss of seven points.

•Scandinavia, including euro zone Finland, recorded a positive performance. Denmark gained three points, followed by Norway and Sweden with +1 in their Eq-Idx, Only Finland recorded no change. It is worth noting that Denmark, Norway and Sweden have Eq-Idx above 100 and only Finland lags with a 92 Eq-Idx.

 

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Living-wage assessment (1996-2018) eight Asia and Oceania economies.

In 2018 Australia, Singapore, South Korea and New Zealand improved their equalisation index (Eq-Idx) in manufacturing, Japan recorded no change and China and India
experienced slight set backs. All gains are largely the result of increases of their hour wage rates in local currency in manufacturing, combined with currency devaluations or decreases in their PPP cost of living for private consumption. Conversely, set backs are, for the most part, the result of decreases in the hourly wage rates in local currency.

•In 2018, Australia recorded the best performance of its Eq-Idx among all 41 economies in our reports by increasing it nine points to a 90 Eq-Idx, which is equal to its best position previously achieved in 2014. This was the result of a strong increase (6,6%) of its hourly rate in local currency and a 2,5% currency devaluation, which contributed to a drop of its PPP cost of living of 2,9%.

•Singapore also recorded a strong performance with a six-point gain as the result of an increase of its hourly wage rate in local currency of 6,6%, a revaluation of its currency of 2,4% and minimal increase of only 0,4% of its PPP cost of living. In this way, Singapore clearly outperformed the 1,8% increase of the US hourly rate in manufacturing and thus increased its equalisation by six points to an 89 Eq-Idx, its best position ever and the second best performance after Australia in 2018.

•South Korea followed with a similar behaviour of the key indicators, gaining three points to a 72 Eq-Idx due to a 5,9% increase of its hourly rate in local currency and a 2,7% revaluation of its currency, which was enough to offset the 2,8% increase of its PPP cost of living.

•New Zealand gained one point in its Eq-Idx (56) due to a 1,8% increase of its hourly rate in local currency, a currency devaluation 2,6% and a drop of 3,5% of its cost of living.

•Japan experienced no change in its Eq-Idx (65) due to a PPP increase of 1,3%, little increase of its hourly wage rate in local currency (0,9%) and a currency revaluation of 1,6%.

•India recorded a one-point loss in its meagre Eq-Idx (14) due to a drop of its hourly wage rate in local currency of 1,7%. India recorded a meaningful currency devaluation of 4,8% and a 2,5% drop of its PPP cost of living, but they were not enough to offset the drop in its hourly wage rate and the 1,8% increase of the US hourly wage rate.

•China also lost one point in its meagre Eq-Idx (18) due to the scant increase of only 1,5% of its hourly wage rate in local currency and a very strong increase of its PPP cost of living of 10,3%, the strongest by far among the 41 economies in our reports.

•As for the Philippines, it has not reported yet an update to its “Compilation of Industry Statistics on Labour and Employment”.

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Living-wage assessment (1996-2018) – the four largest economies in the Americas (Canada, Brazil, Mexico and Argentina).

2018 in the Americas exhibits a clear set back or a stagnation in living-wage equalisation for the four economies in this assessment, with a dramatic loss for Argentina, also a loss for Canada and no
change for Brazil and Mexico in their equalisation indices (Eq-Idx) with comparable US hourly rates in manufacturing.

Canada lost a very meaningful three points in its Eq-Idx drop as the direct result of a rare drop of its hourly rate in manufacturing in local currency, with minimal change in its PPP cost of living and exchange rate. This puts Canada at an 82 Eq-Idx, which is one of the lowest positions recorded since 1996.

•Argentina has experienced a gradual erosion of its Eq-Idx as the direct result of incontrolable high inflation rates since 2008. This erosion began to deepen with the Macri government. In 2017, there was a slight recovery, just before the supply-side staunchly neoliberal economic policies of the, at the time, new government began to dramatically reverse the gains in real wages and labour’s share of income delivered by the previous governments. Contrary to its vow to reduce inflation, which averaged 25,6% in the previous government, the policies of Macri´s government averaged 41,4% in CPI inflation during its four years (2016-2019) and the Argentine peso devalued by 81%. Hence, as expected, in 2018 Argentina’s equalisation index collapsed by dropping 8 points, equivalent to a loss of 16%, the worst performance by far among the 41 economies included in our reports. A new economic crisis exploded closely resembling the 2002 collapse, and all wages have dropped dramatically. In 2018 the minimum wage increased 12,9% but inflation reached 47,8%. In 2018, manufacturing hourly rates increased 26,1% in pesos, but the 41% devaluation produced a drop of 25,7% of its hourly rate in US dollars. Thus, despite a drop of 13% in its PPP cost of living, Argentina’s equalisation index recorded a very steep drop and in 2019 will drop even more, as inflation and devaluation rates became even worse, at 54% and 42% respectively. This will take Argentina back to conditions reminiscent of its previous crisis of 2002-2004.

•After Brazil widened its manufacturing wage gap in 2014 and 2016, due to the devaluation of its currency since 2010 under a sustained recession, it managed to keep its Eq-Idx stable in 2017 and 2018, despite the fact that the neoliberal government of Michele Temer passed a law that put a freeze on public spending effectively ending compliance with the minimum wage appreciation law. Minimum wage policy serves as an indicator for all other wages and directly influences manufacturing wages. End of year inflation rates for 2015, 2016 and 2017, added up to 21%, but manufacturing hourly rates in local currency increased only 15,9% during the 2016-2018 period, As for exchange rates, Brazil’s real has managed to experience a minimal loss of only 4,5% during the same period. This has allowed Brazil’s manufacturing Eq-Idx to suffer a minimal erosion, from 32,2 to 31,6 for the same period, given that Brazil’s cost of living in PPP terms dropped 11,6% in 2018. However, Brazil’s Real lost 7,4% in 2019 and has lost 29,2% in 2020 up to the end of August. Thus the combination of Brazil’s increase in currency erosion and Bolsonaro’s reckless deepening of the anti-labour policies initiated by the Temer government, is bound to widen Brazil’s manufacturing hourly wage rates gap, in real terms, with comparable rates in the US in 2019 and 2020.

•After more than three decades of deliberate state policies to impose modern-slave-work wages, Mexico appears to be gradually reversing such policies. This has resulted in the increase of the minimum wage in real terms beginning in 2017 and 2018 with the previous government, a directive that has been reinforced in 2019 and 2020 with the present government. In 2016, Mexico’s Eq-Idx jumped to an unprecedented level of 24, an increase of 21,2% from 2015, as the result of the combination of a 15,1% currency devaluation, a low inflation (2,7%) and a nominal increase in pesos of 27,7%, which resulted in an increase of 8,4% in US dollars despite Mexico’s peso erosion. As for 2017 and 2018, the hourly rate has increased only 5,7% and 6,4% in nominal terms, somewhat above inflation rates of 2,8% and 6% respectively, resulting in a slight increase in its Eq-Idx from 23,6 in 2017 to 24,1 in 2018. It seams clear that, as expected, the government’s demand-side minimum wage policy is gradually pushing wages up in manufacturing and all sectors. 2019 should show this more clearly for the minimum wage increased 16,1%, inflation 3,6%, the peso only slid 0,1% and the US hourly rate in manufacturing increased only 0,8%, which should increase the manufacturing Eq-Idx at least one point.




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Anti COVID Vaccines — Temporary Suspension of Patents?

The magnitude and complexity of the current pandemic has confronted the world society with seemingly irreconcilable dilemmas between fighting it with a certain level of effectiveness by seriously affecting the functioning of the economy and other aspects of social life such as education, free movement of people, freedom of assembly, etc. Or keeping the latter untouched at the price of an uncontrollable spread of the pandemic. A compromise between the two alternatives has been sought, with relative success.

The vaccines in use seem to play a very important role in slowing down the pandemic. But there is a marked difference between rich and poor countries in terms of their availability. This has direct negative conse-quences on the control of the pandemic in the latter and indirect consequences in the former because of the ease and speed of transmission of COVID and its variants from poor regions to those with a sufficient and even abundant supply of vaccines.

The call then arose to make vaccines a public good, not subject to the laws of the market. And the surprising decision of President Joe Biden, unsuspected of collectivist inclinations, to support India, South Africa and dozens of other countries in temporarily suspending the patents for antiviral vaccines, i.e. the rights inherent to the private ownership of vaccines.

This proposal was immediately rejected by the main leaders of the major powers, except for Macron, who suddenly changed his mind on the matter.

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Capital, Science, Technology

The Development of Productive Forces in Contemporary Capitalism [such as the Silicon Valley Imperial System]

Understanding the way in which contemporary capitalism—which Samir Amin insightfully characterised as the era of generalised monopolies—organises productive forces is crucial to grasping both the forms of domination defining imperialism today and the profound metamorphoses that monopoly capital has undergone during the last three decades.

The concept of general intellect, put forward by Karl Marx, is a useful starting point for the exploration of the organisation of productive forces. Let us take the example of one of the most “advanced” innovation systems today: Silicon Valley’s Imperial System. Our analysis seeks not only to reveal the profound contradictions of capitalist modernity, but also to highlight the significant transmutation that today’s monopoly capital is undergoing. Far from acting as a driving force for the development of social productive forces, it has become a parasitic entity with an essentially rentier and speculative function. Underlying this is an institutional framework that favours the private appropriation and the concentration of the products of general intellect.
 

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Marketocracy and the Capture of People and Planet


The acceleration of Twenty-First Century Monopoly Capital Fascism through the pandemic and the Great Reset

The purpose of this study is to examine the trajectory that the world has been following since neoliberalism was imposed on humanity half a century ago. Its specific aim is assessing the ulterior motivations—and their consequences on humanity and the planet as a whole—of key groups and individuals of the global elite with powerful influence on the world’s governments and multilateral institutions. Among these are the Bill & Melinda Gates Foundation, Elon Musk,Jeff Bezos and, last but not least, the World Economic Forum (from now on WEF), and the purpose of its proclaimed “Fourth Industrial Revolution” through “The Great Reset”. I believe that, on the one hand, we are enduring perilous times for life on our planet, as the direct result of the capitalistic-driven Anthropocene that has put the planet on the brink of crossing a tipping point with dramatic transformations that can become cataclysmic and that threaten the future of all living things. On the other hand, we have a dangerous global elite that has captured our governments and unilaterally pretends to impose their agenda, which true intentions are a future they deliberately keep opaque but are advancing in the most undemocratic manner. It should be extremely evident that the common citizenry is never asked to participate in the discussions and decisions that the elite pretends to advance and implement on behalf of humanity.

Hence, this is my contribution to raising the questions and finding the answers to critical events that we are witnessing as I write. This should help the common citizenry gain knowledge, take consciousness, and empower themselves to make well-informed decisions that can contribute in turn to organise and put in check the agenda pursued by the global elite of the less than one per cent. The current events must make saving our species and our planet the fundamental issue and the overarching and quintessential cornerstone of our effort to transition to a new sustainable paradigm. It cannot be one of many vital issues, but the single element that drives our vision to achieve sustainability that fundamentally determines how we draft our new paradigm. It is in our self-interest to become cognisant about the damning catastrophe that we are facing, stop our numbness and individualism and coalesce to change the current doomed trajectory and veer to what Paul Burkett calls an eco-revolutionary tipping point. This is the cross-sectoral defensive struggles of ecological, communitarian and urban movements coalescing as an ecological socialist movement against "this system of monopoly-finance capital and its state functionaries," the tiny elite who thinks it owns our planet.

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The Pandemic as a Manifesto of a General and Prolonged Crisis of the Capitalist System

—The Case of France


The COVID pandemic constitutes a significant health crisis on a global scale. Additionally, it exposes a general and prolonged crisis of the current capitalist system in its multiple aspects: economic, social, political and cultural, with its specificities in each country. We will attempt to analyse the case of France by considering these different aspects. When articulated together, they can give us a coherent and objective picture of the current state of French society.

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Capital and the Ecology of Disease

The old Greek philosophers,” Frederick Engels wrote in Socialism: Utopian and Scientific, “were all born natural dialecticians.” Nowhere was this more apparent than in ancient Greek medical thought, which was distinguished by its strong materialist and ecological basis. This dialectical, materialist, and ecological approach to epidemiology (from the ancient Greek epi, meaning on or upon, and demos, the people) was exemplified by the classic Hippocratic text Airs Waters Places (c. 400 BCE), which commenced:

"Whoever wishes to investigate medicine properly, should proceed thus: in the first place to consider the seasons of the year, and what effects each of them produces, for they are not all alike, but differ from themselves in regard to their changes. Then the winds, the hot and cold, especially such as are common to all countries, and then such as are peculiar to each locality. We must also consider the qualities of the waters, for as they differ from another in taste and weight, so also do they differ much in their qualities. In the same manner, when one comes into a city to which he is a stranger, he ought to consider its situation, how it lies as to the winds and the rising of the sun.… These things one ought to consider most attentively, and concerning the waters which the inhabitants use, whether they be marshy and soft, or hard, and running from elevated rocky situations, and then if saltish and unfit for cooking, and the ground, whether it be naked and deficient in water, or wooded and well-watered, and whether it lies in a hollow or confined situation, or is elevated and cold; and the mode in which the inhabitants live, and what are their pursuits, whether they are fond of drinking and eating to excess, and given to indolence, or are fond of exercise and labor.… "

"For if one knows all these things well, or at least the greater part of them, he cannot miss knowing, when he comes into a strange city, either the diseases peculiar to the place, or the particular nature of common diseases, so that he will not be in doubt as to the treatment of the diseases, or commit mistakes, as is likely to be the case provided one has not previously considered these matters. And in particular, as the season and the year advances, he can tell what epidemic diseases will attack the city, either in summer or in winter, and what each individual will be in danger of experiencing from the change in regimen.… For with the seasons the digestive organs of men undergo a change."

A key element of this view was the notion of a dialectical relation between the body and the environment, such that the body was situated or embodied in a particular place and specific natural conditions (air and water), producing a vision, as historian of medicine Charles E. Rosenberg has indicated, that was “holistic and integrative—one might call it both ecological and sociological.”

To be sure, in ancient Greece, medicine was bifurcated. Slaves had slave doctors and citizens had citizen doctors, who performed under quite different conditions. The Hippocratic author of Airs Waters Places was writing specifically for citizen doctors, and thus this treatise reflected the class nature of Greek society. Nevertheless, it stood for a general approach that was to influence the later development of epidemiology for thousands of years.

The marginalisation by the mid–twentieth centuryof social-environmental approaches to epidemiologywas justified by the triumph of modern medicineover infectious diseases. It was argued thatinfectious diseases were essentially phenomena ofthe past in developed economies, swept away by the modernisation process. While infectious diseaseswere still present in underdeveloped economies, itwas proposed that health concerns should focus onthe concomitant rise of degenerative diseases. Thisapproach began to crumble.

“Is Capitalism a Disease?,” the appearance at theend of the twentieth century of a new series ofpathogens, including the return of malaria, cholera,dengue fever, tuberculosis, and other classicdiseases, coupled with Ebola, AIDS (HIV), andmultiple drug resistant tuberculosis—to which we could now add others such as H1N1, H5N1, MERS,SARS, and COVID-19 (SARS-CoV-2)—pointed tothe complete failure of the epidemiologicaltransition theory.

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2020 Report: Living-wage assessment – PPP Wage rate gaps for selected "developed and emerging" economies for all employed in manufacturing workers (1996 up to 2018).

Our 2018 assessment reports divergent outcomes among selected economies that were predominantly the result of a meaningful increase of hourly wages in local currency (or lack of it), exchange rates and changes in their PPP cost of living. Six economies improved their position, four lost ground and four did not change. France, Germany, Italy, South Korea, Singapore and Australia improved their equalisation index (Eq-Idx). Canada, United Kingdom, Spain and Turkey lost ground compared to their 2017 position, whilst Brazil, Mexico, Japan and South Africa experienced no change.

Among the six economies that improved their living-wage equalisation position, the main factors were the substantial increase of their hourly rates in local currency combined with a revaluation of their currency or a decrease in their cost of living in PPP terms for private consumption. In the case of the three euro-area countries (France, Germany and Italy), it was specifically the combination of the increase of their hourly wage rates with a revaluation of the euro. This allowed France, Italy and Germany to increase their equalisation Eq-Idx. This combination served to offset their increase of their PPP cost of living, and increased their advantage over the increase of the US hourly rates in real terms. A similar behaviour took place in the case of Singapore and South Korea. In this way, they clearly outperformed the increase of the US hourly rate in manufacturing and thus increased their equalisation Eq-Idx In fact, Singapore’s Eq-Idx is its best recorded since 1996. Australia, in contrast, devalued its currency, but it achieved the highest improvement of its equalisation Eq-Idx among all 41 economies in our reports, which is equal to its best position previously achieved in 2014. This was the result of a strong increase of its hourly rate in local currency and a currency devaluation, which contributed to a drop of its PPP cost of living.

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The Ecological State

–What should the role of the state be in an Ecological Society?

The central problem of economics is scarcity, or at least that is how the story is told. The basic argument is that we have infinite desires but limited resources, and because we cannot have everything we want, we must necessarily devise a system to distribute goods and resources. Enter the efficient market economy, with its prices and wages set by the magical forces of supply and demand, the supposed gatekeepers of the warehouse of economic nirvana. There is a kernel of inadvertent truth behind this narrative. Natural limits certainly impose absolute scarcities that are impossible to overcome. There is only so much uranium in the solar system, for example. And even if we synthesise certain substances by using other substances, the total amount we can produce will still be limited by the availability of the raw materials going into the production process. We cannot beat energy conservation.

Although natural constraints on supply are important, most economic scarcities that rule our lives are actually social and artificial. Supply and demand are not natural forces drifting through the air; they are contrived realities established by an interactive social environment involving governments, corporations, institutions, and classes. Supply and demand cycles are social constructs designed to answer a basic question: Who gets what? Those with social and institutional power decide how they want to distribute money, labor, and resources, and those without must navigate the resulting constraints and roadblocks that have been thrown in front of them, or they can challenge the system and remove some, if not all, of the roadblocks. Especially under capitalism, artificial scarcity is an important social reality that torments the lives of billions around the world, but scarcity as a natural limiting factor in economic activity is not as fundamental as we might like to think. In that case, what is?

The central problem of economics is not scarcity, but stability in the flow of goods and resources, and especially the stability of the ecozones that act as an economy’s primary energy reservoir. The primary goal of any economic system should be to ensure stability and sustainability in the face of nature’s external perturbations, which have always played a dominant role in the development of human history.

The ecological crisis is largely a product of very wealthy people, countries, and corporations exploiting the planet’s resources for their economic gain.4 Capitalism depends on ecological degradation because it needs to rapidly extract vast quantities of natural resources, manufacture the corresponding products, and then commodify the resulting surplus in global exchange markets.5 Capitalists cannot quickly dial back their energy-intensive methods of production and distribution without threatening their profit rates. Because this nexus of corruption cannot be expected to clean its own filth, we must turn toward something that can. The state is the only social institution powerful enough to curb and constrain the energy-intensive economic modes of capitalism. But it is not immediately obvious how it should go about achieving this. Setting up the wrong framework could still produce additional ecological disasters. This is the central question addressed in this article: What should the role of the state be in an ecological society?

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Castellano Transitioning to Geocratia — the