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Obama’s Change of Cuba Policy is Welcome and Long Overdue; Reflects Increasing U.S. Isolation in a Latin America Mostly Run by Left Governments, Says CEPR Co-Director

For Immediate Release: December 17, 2014
Contact: Dan Beeton, 202-239-1460

Washington, D.C.- News that the Obama administration is “changing its relationship with the people of Cuba” is due to the leftward shift in Latin America that has increasingly isolated the United States politically in the region, Center for Economic and Policy Research (CEPR) Co-Director Mark Weisbrot said today. The Obama administration announced the changes following Cuba’s release of USAID contractor Alan Gross and an unnamed “intelligence asset,” and the U.S. release of the three remaining members of the “Cuban Five” who were imprisoned for espionage after working to disrupt plots by Cuban exile extremists based in the U.S. Cuba is also reportedly releasing 53 other political prisoners.

“This historic shift is a direct result of the United States’ increasing isolation in the region,” Weisbrot said. “Relations between Latin America and the Obama administration have been the worst probably of any U.S. administration in decades.  This will help, but new sanctions against Venezuela will also raise questions in the hemisphere about whether this is a change in direction or merely a giving up on a strategy that has failed for more than 50 years.

“Because of the historic transition in Latin America over the past 15 years, with left governments elected in most of the region, basically the rules and norms were changed for the whole hemisphere. Various Latin American governments – and not just those on the left – have been increasingly vocal in recent years that the status quo cannot stand, and that Cuba must be treated as an equal, and welcomed into fora such as the Summit of the Americas,” Weisbrot noted.

“Washington’s Cuba policy is being pulled into the 21st Century thanks to this regional shift.”

Weisbrot added, however: “The U.S. has pumped tens of millions into efforts to undermine left-of-center governments in Latin America, including BoliviaEcuadorVenezuela and Brazil. The just-approved appropriations bill [PDF] includes increased funding for these purposes, and the White House fact sheet on the new Cuba policy makes clear that so-called ‘democracy promotion’ will continue to be a major component. So these activities will continue to harm relations with Latin America. The U.S. still does not have full diplomatic relations with Bolivia and Venezuela.”

Weisbrot noted that the move was also made possible by an apparent willingness by the Obama administration to no longer allow Senate Foreign Relations Chairman Robert Menendez take the lead on Cuba policy. Menendez has vocally opposed the reforms announced today, and is considered a hard-liner on U.S.-Latin America policy.

Weisbrot pointed to the formation of international groupings such as the Community of Latin American and Caribbean States (CELAC) that include Cuba but exclude the United States, and the growing influence and pushback from regional organizations such as UNASUR (the Union of South American Nations), as more evidence of regional change that have made U.S. policy untenable.  “Obama’s decision is also a clear defeat for the Cuban-exile extremists who have dominated U.S. policy toward the region for decades, more recently with their neo-conservative allies.”

Regarding the easing of the embargo, and Obama administration recommendations that it be reconsidered by Congress, Weisbrot said: “The U.S. can no longer ignore international law and the opinion of the entire world. This is a victory for the rule of law in the world of international relations.”

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Slower Population Growth Could Significantly Reduce Carbon Emissions, Paper Finds

December 11, 2014

Contact: Dan Beeton, 202-239-1460

Washington, D.C.- A new research paper from the Center for Economic and Policy Research (CEPR) offers more evidence that slower population growth could significantly reduce carbon emissions and mitigate climate change. The paper, “The Consequences of Increased Population Growth for Climate Change” by economist David Rosnick, finds that that an additional 1 percentage point of population growth through the end of the century would coincide with about an additional 2 degrees Fahrenheit in average global temperatures. “Over time,” the paper concludes, “the temperature change is greater and becomes increasingly sensitive to population growth.”

“There are many warnings of ‘demographic time bombs’ due to population declines in countries like Japan and even China,” Rosnick said. “But lower population growth actually has many economic benefits; one of the most important is that it reduces the rate of global climate change.”

The paper explains that “A larger population requires more farmland, and increased economic activity means greater carbon emissions and more intense climate change.”

The author employs the Global Change Assessment Model (GCAM) to estimate the effects of population growth on the change global average temperature by 2100. Observing that a larger population supports a larger economy, which translates in close proportion into additional releases of carbon dioxide (CO2), the paper notes that global temperature should in any year be nearly linear in relation to the rate of growth when the rate of population growth is constant. 

While the author notes that technology or economics (such as reducing work hours) can produce a path of lower emissions, there also appears to be a significant climate benefit to slower population growth.

The paper notes: “There are many positive economic and social policies that can promote this transition to lower birth rates,” including “more security in old age; [t]he education of girls and women and increased economic opportunities for them, as well as affordable contraception and reproductive choice; lower infant and child mortality; [a]nd increased literacy, education levels, and productivity generally.” Moreover, the paper observes that reductions in population growth in high-income countries will have a greater impact on climate change reduction, due to “much higher per capita consumption and greenhouse gas emissions” in those countries. 

“Fears of ‘demographic crises’ from falling population growth rates in richer countries are dangerous, especially considering the implications for climate change,” Rosnick said. “In fact, not only can working-age populations continue to support larger numbers of retirees, but declining population rates are good for the planet as a whole.”

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Household Wealth Falls Considerably for Majority of Americans

November 6, 2014

For Immediate Release: November 6, 2014
Contact: Alan Barber (202) 293-5380 x115

A new report from the Center for Economic and Policy Research (CEPR) shows that most households now have less wealth now than they did in 1989. The report, “The Wealth of Households: An Analysis of the 2013 Survey of Consumer Finances,” presents data on household wealth by age cohort based on the results of the most recent Survey of Consumer Finances (SCF). The analysis shows little or no gains for the majority of Americans over the last 25 years, even in the years since the end of the recession. This is true of and particularly concerning for near retirees.

“This is especially bad for those nearing retirement,” said Dean Baker, a co-director of CEPR and an author of the paper. “Households in this age cohort will not have a chance to benefit from any strengthening of the economy and will only have the wealth they have accumulated to date to depend on in their retirement.”

The authors document several trends gleaned from the SCF. Between 1989 and 2013, average household net worth rose from $342,300 to $528,400 in 2013 dollars. However the average gains are misleading, as the population was older in 2013 than it was in 1989. More importantly, median net worth actually fell from $84,100 in 1989 to $81,400 in 2013, indicating that much of the gains of wealth accumulation went to those in the top quintiles. Other key points of the analysis include:

  • The median net wealth of near retirees (ages 55-64) was $165,700 in 2013, down from 177,600 in 1989.
  • The average non-housing wealth for the typical household in the 55-64 year old cohort was $89,300, compared to a peak of $160,700 in 2004.
  • The net wealth for the middle quintile (ages 35-44) of mid-career workers averaged $50,100, less than half the net wealth of the same quintile ($103,800) in 1989.
  • The average housing equity for the middle quintile of mid-career workers was also down considerably, from $63,500 in 1989 to $23,200 in 2013.
  • There was some improvement for the middle quintile of recent retirees who saw their average net wealth go up from $142,900 in 1989 to $239,300 in 2013, but this was still less than the peak of $270,700 hit in 2007.

When compared with the previous Surveys of Consumer Finances, it can generally be said that wealth grew in the United States from 1989 to 2007 and shrank from then on. At the time of the 2013 survey, the stock market had almost recovered to its 2007 peak. House prices had not. With house prices representing a larger share of assets for the bottom three fifths of Americans, this helped increase the differences in wealth between the top and the bottom. All in all, the results of the survey yield a pessimistic picture of economic progress since the end of the recession.

The full report can be found here.

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Dilma’s Electoral Victory in Brazil Should Be No Surprise after Economic and Social Gains under PT Governments, CEPR Co-Director Says

October 26, 2014

 
IMF Recommends Changes to Prevent Future Debt Rulings like the One Against Argentina

October 7, 2014

 
The Big Tax Increase Nobody Noticed

September 30, 2014

 
Report Examines Economy and Social Indicators During the Past Decade in Brazil

September 29, 2014

 
The Affordable Care Act and Part-Time Employment: A Family-Friendly Policy

September 11, 2014

 
Economists Call on Congress to Mitigate Fallout from Ruling on Argentine Debt

July 31, 2014

 
Haiti Aid Reform Bill “Will Be a Step in the Right Direction,” CEPR Co-Director Says

July 25, 2014

 
Pay-Cut Clock Documents Billions of Dollars Lost by Minimum-Wage Workers

July, 24, 2014

 
Is Paid Family Leave Really Bad for Business?

June 24, 2014

 
Unions Boost Women’s Earnings, Benefits, and Workplace Flexibility

June 18, 2014

 
Federal Paid Leave Policy Could Allow Millions of Working Americans Access to Much Needed Family and Medical Leave

June 16, 2014

 
New Paper Finds No Evidence that Latin America’s Economic Growth Rebound Results from a “Commodities Boom”

May 21, 2014

 
Black Recent Grads Hardest Hit by the Great Recession

May 20,2014

 
New Book Examines Private Equity’s Role in the U.S. Economy & Labor Market

May 15, 2014

 
Expansion of FMLA to Small Firms would Give Coverage to Over 34 Million Working Americans

April 22, 2014

 
The Last Three Decades of Women’s Rising Hours of Work Added $1.7 Trillion to GDP in 2012

April 15, 2014

 
New Report Confirms Connecticut Business Owners’ Positive Experience with Nation’s 1st Paid Sick Days Law

March 6, 2014

 
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