Britain's GDP fell again in the fourth quarter of 2012, raising the specter of a triple-dip recession
Britain's economy is a riddle wrapped in a mystery inside an enigma, but this much is clear: it's a disaster. After its Olympics-fueled growth, such as it was, lifted it out of recession in the third quarter of 2012, Britain might be headed back after its economy fell 0.3 percent at the end of the year -- the fourth time in five quarters its GDP has contracted. Britain's now verging on a triple-dip recession, which is just another way of saying a depression.
But it's not so simple.
Britain is stuck in its worst GDP slump in a century, but not so for jobs. As you can see in the chart below from Jonathan Portes, the director of the National Institute of Economic and Social Research, Britain's stagnating economy has left it in worse shape at this point of its recovery than it was during the Great Depression. GDP is still more than 3 percent below its 2008 peak, and it hasn't done anything to catchup in years. At this pace, there will be no recovery in our time, or any other time.
It's no accident this era of zero growth has coincided with an era of austerity. Despite entering office with borrowing costs at 50-year lows, the Cameron coalition decided the government deficit, and not the growth deficit, was the chief threat to future prosperity. It raised taxes and cut the growth of spending, but did so with little regard for what constituted smart cuts and what did not. As Portes points out, public net investment -- things like roads and bridges and schools, and everything else the economy needs to grow -- has fallen by half the past three years, and is set to fall even further the next two. It's the economic equivalent of shooting yourself in both feet, just in case shooting yourself in one doesn't completely cripple you. Austerity has driven down Britain's borrowing costs even further, but that's been due to investors losing faith in its recovery, rather than having more faith in its public finances. Indeed, weak growth has kept deficits from coming down all that much, despite the higher taxes and slower spending. In other words, it's economic pain for no fiscal gain.
But the story of Britain's flatlining growth isn't just one of ignoring Keynes' maxim that the boom, not the slump, is the time for austerity. It's more like an economic whodunit. The euro crisis -- yes, we're rounding up the usual suspects -- has kept Britain from exporting its way out of trouble, as its largest trading partner, the euro zone, has been too busy flirting with breakup and recession to buy as much stuff as it otherwise would. It hasn't helped that some of Britain's big productivity industries like oil and finance have gone into what might be the start of long-term declines; the North Sea oil and gas fields and the City of London have both shed output and jobs. But this downtrend in Britain's top industries doesn't nearly explain the real puzzle of its economy -- the collapse in productivity.
In other words, the disconnect between GDP and jobs. While the economy is, at best, stuck in neutral, Britain has been adding jobs at a better-than-decent clip the past year or so. Unemployment recently reached an 18-month low, and, in absolute terms, more people have a job today than in 2008 (though underemployment is a problem). This combination of zero GDP growth with positive job growth means Britain is working more to do less. Richard Davies of The Economist calculates Britain is 12 percent less productive today than it was at similar points in other recoveries -- and the decline of the North Sea fields and the City probably only explain 1-2 percentage points of this gap. That leaves a pair of, hardly mutually exclusive, possibilities: either Britain has some serious GDP mismeasurement problems or some serious economic problems, full stop. The former is usually the case any time there's an apparent disparity between GDP and jobs data, but the disparity is so large and so persistent in this case that it seems something else is going on. Davies hypothesizes zombie firms are starving new, more productive firms, for credit, which may well be true, but, again, doesn't seem to explain the full scope of the disaster.
The good news, if there is any, is Britain just poached Mark Carney, one of the top central bankers in the world, to run the Bank of England, and he seems determined to do more than his predecessor to get the country out of its economic rut. And that's it. There is no other good news. Thank goodness for stiff upper lips.
A new anatomical understanding of how movement controls the body’s stress response system
Elite tennis players have an uncanny ability to clear their heads after making errors. They constantly move on and start fresh for the next point. They can’t afford to dwell on mistakes.
Peter Strick is not a professional tennis player. He’s a distinguished professor and chair of the department of neurobiology at the University of Pittsburgh Brain Institute. He’s the sort of person to dwell on mistakes, however small.
“My kids would tell me, dad, you ought to take up pilates. Do some yoga,” he said. “But I’d say, as far as I’m concerned, there's no scientific evidence that this is going to help me.”
Still, the meticulous skeptic espoused more of a tennis approach to dealing with stressful situations: Just teach yourself to move on. Of course there is evidence that ties practicing yoga to good health, but not the sort that convinced Strick. Studies show correlations between the two, but he needed a physiological mechanism to explain the relationship. Vague conjecture that yoga “decreases stress” wasn’t sufficient. How? Simply by distracting the mind?
City dwellers spend nearly every moment of every day awash in wi-fi signals. Homes, streets, businesses, and office buildings are constantly blasting wireless signals every which way for the benefit of nearby phones, tablets, laptops, wearables, and other connected paraphernalia.
When those devices connect to a router, they send requests for information—a weather forecast, the latest sports scores, a news article—and, in turn, receive that data, all over the air. As it communicates with the devices, the router is also gathering information about how its signals are traveling through the air, and whether they’re being disrupted by obstacles or interference. With that data, the router can make small adjustments to communicate more reliably with the devices it’s connected to.
No one will ever find a closer exoplanet—now the race is on to see if there is life on its surface.
One hundred and one years ago this October, a Scottish astronomer named Robert Innes pointed a camera at a grouping of stars near the Southern Cross, the defining feature of the night skies above his adopted Johannesburg. He was looking for a small companion to Alpha Centauri, our closest neighboring star system.
Hunched over glass photographic plates, Innes teased out a signal. Across five years of images, a small, faint star moved, wiggling on the sky. It shifted just as much as Alpha Centauri, suggesting its fate was intertwined with that binary system. But this small star was closer to the sun than Alpha. Innes suggested calling it Proxima Centauri, using the Latin word for “nearest.”
The dim red star soon entered the collective imagination, inspiring dreams of interstellar travel. Gravity has linked the star to the Alpha Centauri system, but our culture of science and storytelling has linked it to the solar system. Today, that link will grow stronger, when an international team of astronomers announces that this nearest of stars also hosts the closest exoplanet, one that might look a whole lot like Earth.
Do mission-driven organizations with tight budgets have any choice but to demand long, unpaid hours of their staffs?
Earlier this year, at the encouragement of President Obama, the Department of Labor finalized the most significant update to the federal rules on overtime in decades. The new rules will more than double the salary threshold for guaranteed overtime pay, from about $23,000 to $47,476. Once the rules go into effect this December, millions of employees who make less than that will be guaranteed overtime pay under the law when they work more than 40 hours a week.
Unsurprisingly, some business lobbies and conservatives disparaged the rule as unduly burdensome. But pushback also came from what might have been an unexpected source: a progressive nonprofit called the U.S. Public Interest Research Group (PIRG). “Doubling the minimum salary to $47,476 is especially unrealistic for non-profit, cause-oriented organizations,” U.S. PIRG said in a statement. “[T]o cover higher staffing costs forced upon us under the rule, we will be forced to hire fewer staff and limit the hours those staff can work—all while the well-funded special interests that we're up against will simply spend more.”
This much is obvious: Young people don’t buy homes like they used to.
In the aftermath of the recession and weak recovery, the share of 18- to- 34 year olds—a.k.a.: Millennials—who own a home has fallen to a 30-year low. For the first time on record going back more than a century, young people are now more likely to live with their parents than with a spouse.
It’s become en vogue to argue that young people’s turn against homeownership might be a good thing. After all, houses are not always dependable investment vehicles, a lesson the country learned all too painfully after the Great Recession. Without being anchored to any one city from their mid-20s and into their 30s, young people who don’t own are free to roam about the country in search of the best jobs. What’s more, given the copious advantages of a college degree in this economy, perhaps many young people could be commended for investing in their intelligence, professional networks, and abilities rather than devote that same income to a roof, floor, and furniture.
A recent scholarly paper on “microaggressions” uses them to chart the ascendance of a new moral code in American life.
Last fall at Oberlin College, a talk held as part of Latino Heritage Month was scheduled on the same evening that intramural soccer games were held. As a result, soccer players communicated by email about their respective plans. “Hey, that talk looks pretty great,” a white student wrote to a Hispanic student, “but on the off chance you aren’t going or would rather play futbol instead the club team wants to go!!”
Unbeknownst to the white student, the Hispanic student was offended by the email. And her response signals the rise of a new moral culture America.
When conflicts occur, sociologists Bradley Campbell and Jason Manning observe in an insightful new scholarly paper, aggrieved parties can respond in any number of ways. In honor cultures like the Old West or the street gangs of West Side Story, they might engage in a duel or physical fight. In dignity cultures, like the ones that prevailed in Western countries during the 19th and 20th Centuries, “insults might provoke offense, but they no longer have the same importance as a way of establishing or destroying a reputation for bravery,” they write. “When intolerable conflicts do arise, dignity cultures prescribe direct but non-violent actions.”
In his 1945 article “The Economic Organisation of a P.O.W. Camp,” the British economist R.A. Radford recounted his experiences within the informal system of barter among prisoners at Stalag VII-A, a German camp on the outskirts of Munich during the Second World War. Using supplies delivered by the Red Cross, some prisoners moved between different nationalities’ encampments, buying tea for cheap from the French (who tended to prefer coffee) and then selling it to the British (whose affection for tea is a matter of centuries-old lore). Meanwhile, imprisoned Gurkha soldiers from South Asia sought out tins of vegetables and bartered them for corned beef.
Radford’s account, which was compellingly retold by Ray Fisman and Tim Sullivan in their recent book The Inner Lives of Markets, explains that, in the absence of paper money, prisoners had to pick another currency to enable their transactions: cigarettes. “A ration of margarine might be bought for seven cigarettes, the equivalent, for instance, of one and a half chocolate bars, and so on,” Fisman and Sullivan write. “For the most part, prices were well known and consistent among the camp’s many huts that acted as local markets.”
Donald Trump’s campaign manager says he’s actually winning, thanks to “undercover” supporters. Plenty of past presidential hopefuls have mistakenly believed the same.
A candidate or operative on a campaign that's losing has three options: despair; accept what’s happening and try to fix it; or deny. Right now, the Donald Trump campaign is exhibiting all three.
For despair, there are the staffers who are reportedly “suicidal” inside Trump Tower, and those who have simply quit. For acceptance, Trump himself has admitted he’s in trouble. But newly promoted campaign manager Kellyanne Conway is taking the denial route.
“Donald Trump performs consistently better in online polling where a human being is not talking to another human being about what he or she may do in the election,” she told the British outlet Channel 4. “It’s because it’s become socially desirable, if you’re a college educated person in the United States of America, to say that you’re against Donald Trump.”
A team of doctors across the world is helping the only two medical professionals left in one besieged town in Syria—via cell phone.
Earlier this year, a Syrian American orthopedic surgeon was shopping with his two toddlers at a Walmart in Grand Rapids, Michigan, when he heard the familiar ping of a notification from WhatsApp, the encrypted messaging service: A teenager had been shot in the leg and the bullet had passed straight through his tibia. The fractured bone punctured his skin like a spear. Although it was the surgeon’s day off, he took the call—as an expert in complex bone operations, this was his specialty.
But this was no ordinary case. His patient was over 6,000 miles away, awaiting care in a makeshift medical clinic in Madaya, a town in Syria some 28 miles from Damascus. The clinic is only a 45-minute drive from Damascus Hospital, but it might as well be on the other side of the world. Madaya, a rebel-held town controlled by the Islamist group Ahrar al-Sham, has been held under siege by Hezbollah, which is fighting on behalf of the Syrian government, since last July. Hezbollah won’t let anything in or out of the town; it was a Hezbollah fighter, locals say, who shot the teenager in the leg.