Heritage Foundation is run by Jim DeMint, the former Tea Party legislator. Heritage promptly demonstrated the impact of its new leadership with its purported study of the benefits and costs of immigration that ignored the benefits and inflated the costs. Even other conservative groups were appalled – and that was before one of the co-authors of its studies’ past writings on the inferiority of certain minorities that purportedly made assimilation fail became public. Heritage is one of many anti-think tanks where anyone with a progressive thought is shown the door.
NEP’s William Black appeared on the June 22, 2013 episode of Alpha and Omega. The topic of discussion is about a series of articles he has written over the last year on the economic achievements and political shenanigans of Rafael Correa, the President of Ecuador.
NEP’s William Black appeared on The Real News , February 17, 2013, discussing how Ecuador has been dealing with the recession, and some of the things we can learn from it. You can view the video below or if you wish to view the video as well as the transcript posted at TRNN, you can click this link.
By William K. Black
(Cross posted at Benzinga.com)
Ecuador’s President Rafael Correa has the special ability to drive our most elite media nuts. Failures are self-refuting. It is the successful that drive their opponents to distraction, and much of the media can barely contain its eagerness to write that Correa has failed. In 2009, The Economist practically licked its lips in eager anticipation of what it hoped would be Correa’s (and Ecuador’s) failure due to the “country’s acute financial problems.” Continue reading →
Alvaro Vargas Llosa (AVL) co-authored the Guide to the Perfect Latin American Idiot with two other journalists. He revisited the subject with an article in 2007 entitled “The Return of the Idiot.”
“The ‘Idiot’ species, we suggested, bore responsibility for Latin America’s underdevelopment. Its beliefs — revolution, economic nationalism, hatred of the United States, faith in the government as an agent of social justice, a passion for strongman rule over the rule of law — derived, in our opinion, from an inferiority complex. In the late 1990s, it seemed as if the Idiot were finally retreating. But the retreat was short lived. Today, the species is back in force in the form of populist heads of state who are reenacting the failed policies of the past, opinion leaders from around the world who are lending new credence to them, and supporters who are giving new life to ideas that seemed extinct.” Continue reading →
In November 2011, President Correa appointed Pedro Delgado as head of Ecuador’s Central Bank. The appointment was controversial. The obvious controversy was that Delgado is Correa’s cousin. Conservatives claimed that Delgado lacked integrity. Some progressives shared the concerns about his integrity and saw Delgado as too supportive of Ecuador’s largest banks and bankers. The recent banking crisis, in which the owners and managers of Ecuador’s four largest banks began a bizarre campaign of threatening to induce a run on their institutions to extort Correa into withdrawing his very sensible program of increasing the banks’ taxes and reforming the bankers’ dangerously perverse executive compensation, provided a test of these concerns by Correa’s supporters about Delgado. I explained how irresponsible the banking oligarchs’ campaign was in interviews in Ecuador and the U.S. and an article. I explained the vigorous manner in which U.S. regulators of my era would have acted to end the oligarchs’ efforts to extort the government and people of Ecuador by threatening to cause a banking run. Continue reading →
One of the distinctive features of banking in scores of developing nations is the very large spreads between the rate of interest they pay their depositors and the rate they charge borrowers. Academics have frequently focused on the exceptionally high spreads in Latin America in articles published over the last three decades. Economic theory predicts that these spreads should impose a major drag on development. The high interest rates charged to lenders should lead to very large “hurdle rates” for prospective borrowers’ projects. The two obvious implications of high hurdle rates, sometimes discussed in the literature, are that fewer worthwhile investments will be made by prospective entrepreneurs and more of the loans in Latin America are likely to go to high risk borrowers. High risk investments should be, if financial markets are efficient, more likely to produce higher returns exceeding the hurdle rate. The standard neo-classical economic assumption is that financial markets are efficient.
William Black, by invitation of the President of Ecuador’s National Assembly, will present to the Standing Specialized Committee of Economic and Tax Regime in Quito, Ecuador on the banking crisis in that country.
Professor Black’s experience in financial regulation and his involvement in the US Savings and Loan Crisis puts him in a position to assist the Ecuadorians with their banking crisis.