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Which Countries Work Hardest? You Might (Not) Be Surprised

Imagine you had to choose, and could choose: you can spend your whole life and raise your family in either of two equally prosperous countries. In one country people work lots of hours to attain that prosperity. In the other country people work far less. You don’t know anything else about these countries.

Which would you choose? The answer seems kind of obvious, right? Equally prosperous, and less work for me and my family? Sign me up!

But that straightforward question is almost never asked, explicitly, in discussions of prosperity, growth, and national well-being. The most obvious measure of that difference — hours worked per capita — is buried, invisible, and unavailable in the various national data sets scattered around the web. (The typical national measure you see out there is hours worked per worker.)

For the curious, here’s how more-prosperous countries (OECD and a handful of others) sort on the “hard-working” scale:

Screen shot 2015-06-28 at 5.35.57 PM

This average includes the whole population — workers, children, students, retirees, etc. — so it’s an index of how much the average person has to work over the course of their life. (More hours during working years, less or none during non-working years; it’s an average.) 

There’s one main generalized takeaway from this that I see: The less-work end of the spectrum is dominated by western European countries. People there work far less hours in the course of their lives. People in “Anglo”-model countries work far more.

Going back to choosing a country: you also want to know how prosperous it is in pure money terms, using something like GDP per capita. Here’s that (I’ve excluded tiny, crazy-high-GDP Luxembourg here — think: banking — to show other countries more clearly):

Screen shot 2015-06-30 at 12.08.53 PM

If you’re a rational shopper, you’ll choose Norway (yeah, they’ve got the advantage of all that oil…), Ireland, the Netherlands, or another country in the upper left. If an extra $5,000 or $10,000 a year is worth sacrificing four or five extra weeks of work, choose the U.S. (Think: “buying” an extra month of time with your family, doing things you like and love, every year. You decide. But do I need to remind you that 1. Life is short, and 2. “Family values” really do have value?)

One perhaps-surprising takeaway from this graph: hard-working countries aren’t richer. QTC. Causation? It seems improbable that working less would cause higher prosperity. Higher prosperity could quite reasonably cause people to work less. (The good old substitution effect, income versus leisure.) But the most likely conclusion is that high productivity (GDP per hour worked) is the 800-pound gorilla when it comes to prosperity. Long hours worked have zero or negative apparent effect on prosperity.

(Interesting parallel: hours worked per household member in the U.S. only “explain” seven percent of the variance between household incomes. Whodathunkit?)

Rather than eyeballing that scatter plot, you might want a handy index of which country to choose. Here’s one approach to what I’ll call Work-Weighted Prosperity: GDP/Capita divided by Hours Worked/Capita. If people in one country have to work lots of hours to get that prosperity, it gets ranked lower.

Screen shot 2015-06-29 at 6.06.17 AM

The takeaway here? Move to Luxembourg and get into banking.

The curious among you are probably wondering about different countries’ working-age populations (doesn’t actually vary that much), and the percentage of working age that are working (varies somewhat more). Here’s the spreadsheet.

Cross-posted at Asymptosis.

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Will the US keep winning indefinitely? ISDS, that is

Now that Congress has given the President fast-track Trade Promotion Authority, the first agreement to be considered under these rules (no amendments allowed, up or down vote in 90 days) will be the Trans-Pacific Partnership (TPP). As you know from previous columns, one of the most worrying aspects of the TPP is its expansion of investor-state dispute settlement (ISDS), wherein private firms can bring their disputes with governments not to courts, but to international arbitration (usually through units of the World Bank or the United Nations), where legal precedent doesn’t matter and appeal is all but non-existent. Moreover, as the Consumers Union has long argued (recent example here), arbitration has a well-known pro-business bias. That’s why so many of your agreements with cable TV providers, financial services companies, and many more have fine print requiring mandatory arbitration, keeping you from getting your day in court if something goes wrong.

The response from the U.S. Trade Representative’s (USTR) office has been, “Not to worry! The United States has never lost an ISDS case.” The linked document goes on to claim that worldwide, only 1/4 of corporate plaintiffs have won cases against governments. But a new analysis by the International Institute for Sustainable Development (IISD),* using the same data source the USTR cites, comes to a very different conclusion based on its most recent update, the 2015 World Investment Report from the United Nations Conference on Trade and Development (UNCTAD). Moreover, we can see that countries with even more trustworthy court systems than that in the U.S. have lost ISDS cases. The Rule of Law Project, an initiative of the American Bar Association, has ranked 102 countries on the administration of justice and freedom from corruption, and puts the United States at #19 with a score of 0.73. Yet #14 Canada (0.78) has already lost ISDS cases, and both Canada and #10 Australia (0.80) are currently on the hook for major new cases (Eli Lilly and Philip Morris, respectively), that would overrule decisions by the countries’ respective Supreme Courts. So, even if governments have only lost 25% of ISDS cases, it’s unlikely U.S. luck will hold out indefinitely, if countries with better court systems are losing.

But it’s worse than that. UNCTAD’s database of known ISDS cases and their outcomes shows that in all cases decided through the end of 2014, the investor won 27% of the cases compared to 36% won by the state (see Figure III.10, p. 116). But another 26% of the cases are listed as “settled,” which often (but not always) means the respondent agrees to make some payment to the plaintiff to keep the case from going to arbitration. Public Citizen has a list of ISDS cases under prior U.S. trade agreements with examples of settlements that do and do not contain payments (see, for instance, NAFTA cases against Canada).

Moreover, as IISD attorney Howard Mann argues, if we separate out cases between jurisdictional determinations and determinations on the merits of the case, things look even worse for states. While only 71 of 255 cases (this excludes the “settled” cases) were concluded by a decision of the tribunal having no jurisdiction, Mann points out that all 255 cases effectively had decisions on jurisdiction, i.e., cases with final decisions had to have rulings that the arbitrators had jurisdiction. In that case, Mann says, “Investors, therefore, have won 72 per cent [184/255] of jurisdictional determinations.” And of the decisions on the merits of the cases, investors won 111, or 60%, of the remaining 184 cases. This calculation suggests that states are losing ISDS disputes at a much higher rate than normally portrayed. As if that’s not bad enough, the new World Investment Report finds that in 2014, of the 15 ISDS cases decided on their merits, states lost 10 (2/3) of them. In 2013, it was even worse for states, with investors winning 7 of the 8 cases decided that year (p. 126). If these higher proportions continue, obviously the proportion of investor victories will increase beyond the current 60% total.

Bottom line: The threat to regulation, democracy, and the rule of law posed by investor-state dispute settlement is very real. The U.S. Trade Rep’s  reassurances that the U.S. has never lost in ISDS don’t even make it likely that will continue into the future. We need to pressure Congress to vote down the TPP when negotiations conclude.

* Important disclosure: I have consulted for IISD several times since 2007 on investment incentive issues.

Cross-posted from Middle Class Political Economist.

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Anthony Kennedy Adds the Fifth Vote in the Citizens United Against Gerrymandering Opinion

Tomorrow, in addition to the predictable ruling in the EPA/mercury-emissions case, and in addition to a declaration of a constitutional right to same-sex marriage—another 5-4 ruling, in Obergefell v. Hodges—the Court will issue an opinion in Arizona State Legislature v. Arizona Independent Redistricting Commission, a case that could directly implicate continued Republican control of the House of Representatives.  So the only question is, which way will Kennedy vote—and most people expect that he will vote Republican.

Which is to say, most people think he’ll make up the fifth vote to strike down as unconstitutional an amendment to Arizona’s state constitution, passed by the state’s voters in 2000, that removed the legislature’s authority to draw boundaries for federal congressional districts away and placed that authority with an independent redistricting commission.  The legislature is challenging the amendment’s constitutionality under the Elections Clause, which states: “Times, Places and Manner of holding Elections for . . . Representatives, shall be prescribed in each State by the Legislature thereof.”  (Scotusblog notes that California has a similar setup.)

Obviously, since state legislative gross gerrymandering is largely responsible for Republican control of the House, presumably until after the next census in 2020, the Republican justices don’t want to invite, say, Pennsylvania voters to push through something similar in a voter referendum, reversing the extreme gerrymandering there by the Republican-controlled legislature in 2011. That includes Kennedy.  But Kennedy authored Citizens United and reportedly was the one who encouraged his cohorts to take on issues that had not been raised in the case, in order to destroy the McCain-Feingold law, and he’s been on the extreme defense about it ever since.  He could see this as some sort opportunity to regain some semblance of credibility on the nonpartisan front.  I mean, you never know.

Okay, you probably do know.  It won’t happen. The CW will prove right.

— In its ACA opinion today, the Court significantly narrowed its “Chevron-deference” doctrine.  I’m glad. Even despite the immediate repercussions for EPA authority., Me, Jun. 25

Okay, well, the EPA/mercury-emissions opinion, in Michigan v. EPA, and the Arizona Independent Redistricting Commission opinion were released today rather than on Friday.  As expected, both were 5-4 opinions with Kennedy as the swing vote.

Also as expected—by me and pretty much everyone else—the EPA’s interpretation of a phrase in the Clean Air Act was stricken as beyond the reasonable meaning of that phrase within the context of the Clean Air Act.  This is a big, big win for power plants and the Koch brothers.

But as not necessarily expected, by me or (to my knowledge) many other people, was the result in the Arizona Redistricting Commission case.  Which is to say, Kennedy’s decision to join Ginsburg’s opinion interpreting the Constitution’s Elections Clause as referring not to the actual legislative body but to a state’s general authority—vis-à-vis the federal government’s—to determine such matters, in this case via a voter-led referendum in 2000 that established a bipartisan state commission for the purpose of redistricting congressional districts.

“Arizona voters sought to restore the core principle that the voters should choose their representatives, not the other way around,” Ginsburg said in a statement she read in the courtroom.  The full provision in the Constitution’s Article I, Section 4, Clause 1, states:

The Times, Places and Manner of holding Elections for Senators and Representatives, shall be prescribed in each State by the Legislature thereof; but Congress may at any time make or alter such Regulations, except as to the Place of chusing Senators.

“Arizona voters sought to restore the core principle that the voters should choose their representatives, not the other way around,” Ginsburg wrote.

What I find curious is the majority’s interpretation of “The Times, Places and Manner of holding Elections for Senators and Representatives” as referring to redistricting methods at all.  And theoretically, it’s interesting that Scalia, Thomas and Alito, after all the venom they spilled last week in their King v. Burwell dissents—words no longer have meaning, etc., etc.—think “Times’ means something other than “times”; “Places” means something other than “places”; and “Manner” means something other than, well, “manner”.  I haven’t read the Ginsburg opinion yet, and I don’t know whether it addresses this. And while Ginsburg wrote the opinion, Kennedy controlled the basis for it.

But in my opinion, the grounds that the majority settled on are broader and better than a decision limited to the issue of gerrymandering. Which, it seems to me, this isn’t.  I’m certainly no expert in election law, but off the top of my head the ground on which the opinion is based—that the Elections Clause as referring not to the actual legislative body but to a state’s general authority to determine such matters, including by voter-led referendum—then states (Think: Wisconsin; North Carolina; but not, of course, Texas) might reverse the uber-restrictive voter-ID laws enacted the moment that the Tea Party gained control over the state’s legislative and executive branches together.

Well, we’ll have to see what the experts say about that.  Sit tight.  But even if limited to voter referendums on creation of anti-gerrymandering commissions, this opinion is a very big deal.  I think.

Citizens united in Arizona in 2000 against extreme gerrymandering. Now citizens can unite in other states to do the same.


UPDATE: Richard Hasen, a professor at UC-Irvine law school and a leading liberal election law expert (he blogs on election law at, just published an article on Slate on the opinion in Arizona State Legislature v. Arizona Independent Redistricting Commission, in which he conjectures about the reasons for Kennedy’s surprising vote and notes that, as in King v. Burwell, Kennedy seems to have changed his mind after the argument in the case this spring.  Slate notes at the bottom of the article that he has a book forthcoming called Plutocrats United: Campaign Money, the Supreme Court, and the Distortion of American Elections.  Cool.

Added 6/29 at 3:42 p.m.


SECOND UPDATE:  Hmm. Two terrific articles about the actual effect of the EPA decision on coal-powered power plants. One, by Michael Grunwald in Politico, discusses both the specifics of the ruling and the quickly progressing demise of the coal industry, which is rapidly being replaced by gas and solar and wind power. His article is titled “A great day for coal? Not exactly.” It’s subtitled “Why the Supreme Court’s strange EPA decision won’t matter as much as people think.”

The other, by Eric Holthaus in Slate, is called “Bad News: Supreme Court Blocked Power Plant Rules. Good News: The Era of Coal Is Over.

Since I’m one of the people referred to in Grunwald’s subtitle, I thought I should mention these articles.   This is just a  big win for coal-powered power plants, not a big, big win for them.  The Koch brothers are still pretty happy tonight, though.

Added 6/29 at 9:40 p.m.

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Brad DeLong buries the Lead in what is left of George Will’s Credibility

(Lifted from Robert’s Stochastic Thoughts)

by Robert Waldmann

Brad DeLong buries the Lead in what is left of George Will’s Credibility

A 16th paragraph (if I counted right) at the Washington Center for Equitable Growth blog is more prominent that a first paragraph here, but Brad has never been a stickler for restrictions on fair use, so I will steal his amazing catch. He notes George Will being sloppy then dishonest.

George F. Will is angry:

The paramount injury [from Roberts’s decision] is the court’s embrace of a duty to ratify and even facilitate lawless discretion exercised by administrative agencies…. Rolling up the sleeves of his black robe and buckling down to the business of redrafting the ACA, Roberts cites a doctrine known as “Chevron deference.”… The doctrine is that agencies charged with administering statutes are entitled to deference when they interpret ambiguous statutory language. As applied now by Roberts, Chevron deference obligates the court to ignore language that is not at all ambiguous but is inconvenient…

One problem is that George F. Will seems not to have read John Roberts’s opinion before writing. He decided to attack John Roberts for expanding the deference that the Supreme Court offers the President. But Chief Justice John Roberts says expressly that he is not – repeat NOT — deferring to the IRS in the manner of the Chevron case. He is not expanding the deference that the Supreme Court offers the President: he is, in fact, narrowing it:

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Greek Tale(s)

by Joseph Joyce

Greek Tale(s)

No matter what new twist the Greek debt crisis takes, there can be no question that it has been a catastrophe for that country and for the entire Eurozone. The Greek economy contracted by over a quarter during the period of 2007 to 2013, the largest decline of any advanced economy since 1950. The Greek unemployment rate last year was 26.5%, and its youth unemployment rate of 52.4% was matched only by Spain’s. But who is responsible for these conditions depends very much on which perspective you take.

From a macroeconomic viewpoint, the Greek saga is one of austere budget polices imposed on the Greek government by the “troika” of the International Monetary Fund, the European Commission and the European Central Bank in an attempt to collect payment on the government’s debt. The first program, enacted in 2010 in response to Greece’s escalating budget deficits, called for fiscal consolidation to be achieved through cuts in government spending and higher taxes. The improvement in the primary budget position (which excludes interest payments) between 2010-11 was 8% of GDP, above its target. But real GDP, which was expected to drop between 2009 and 2012 by 5.5%, actually declined by 17%. The debt/GDP level, which was supposed to fall to about 155% by 2013, actually rose to 170% because of the severity of the contraction in output. The IMF subsequently published a report criticizing its participation in the 2010 program, including overly optimistic macroeconomic assumptions.

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Horses, Carts, and the Order in Which They Belong

Democrats should take continued GOP opposition to Obamacare very seriously. It has serious real-world consequences. As long as states hold out against the Medicaid expansion, it could slow the law’s efforts to realize its goal of expanding coverage. One thing this means is that Democrats should redouble their efforts to regain electoral ground on the level of the states, where future decisions about the Medicaid expansion will be made.

— Morning Plum: GOP won’t give up fight against Obamacare. Dems should take that seriously., Greg Sargent, Washington Post, today

I should have known by now that neither Democratic politicians, nor their political consultants, nor virtually any progressive pundits will ever consider the possibility that it puts the cart before the horse to try to regain electoral ground on the level of the states through some generic campaign that doesn’t the issue of the Medicaid expansion—so that, once in office, the Dems can enact the Medicaid expansion.

But, no, I had thought that the one plus in the months-long concern about the outcome of King v. Burwell—which indicated the political disaster that a win for their side would cause the Republicans (they were seriously panicking)—was that the Dems and progressive pundits would recognize, finally, that providing access to healthcare for those who otherwise have no access to it is popular.  Especially, it turns out, among the beneficiaries and potential beneficiaries.  And that campaigning on the issue increases the chance of winning.

But I should have recognized that once pols, consultants, and pundits get locked into a mindset about something, nothing will jar them loose from it.  Nothing.  Ever.

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Scalia’s Craven Self-Contradiction and Pettifogging Pedantry

In his dissent to Edwards v. Aguillard, Supreme Court justice Antonin Scalia made a neat distinction, sidestepping the issue of “legislative intent” that he finds so troubling:

it is possible to discern the objective “purpose” of a statute (i. e., the public good at which its provisions appear to be directed),

(The dissent is obsessed with “purpose”; the word appears 76 times therein.)

But in his dissent on yesterday’s King v. Burwell (Obamacare) decision, he chooses to ignore that statute’s obvious, objective purpose: to provide subsidies for buyers of exchange plans.

Rather than doing as he proposes, trying to “discern the objective ‘purpose’ of a statute'”, he seeks to deny the statute’s obvious purpose by determining the “purpose” of a few words therein — with a statement that can only be perceived as intentionally obtuse:

it is hard to come up with a reason to include the words “by the State” other than the purpose of limiting credits to state Exchanges

This very smart man could easily “come up with a reason.” Since those words contradict the obvious, objective purpose displayed by everything else in the statute, the words were accidentally misphrased. You might even go so far as to say that this is the obvious, “objective” conclusion.

Scalia would agree. In his dissent on the previous Obamacare challenge, he says:

“Without the federal subsidies . . . the exchanges would not operate as Congress intended.”

You may feel free to quibble over “purpose” versus “intention,” but the obvious, objective, intentional purpose of the statue was to give subsidies to purchasers of exchange plans.

Any attempt to deny or obscure that reality is pettifogging pedantry. Nothing more.

Update: Bruce Webb in comments shows just how objectively obvious the “purpose” is. The title of the statute’s opening section (emphasis mine):

Title I. Quality, Affordable Health Care for All Americans

Cross-posted at Asymptosis.

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