Aurelia Butler

If you live in a rich country, all things being equal, you are more likely to live alone, more likely to suffer from depression or anxiety and less likely to have children. One movement that thinks it has the solution to these problems is national conservatism. Its message is that politicians should champion the constitutional, cultural and religious traditions of the country in question. National conservatives are right about one thing: most of the problems that the rich world struggles with are problems of success. These range from comparatively minor inconveniences such as gridlock and overcrowded trains to existential threats such as climate change and artificial intelligence. But the difficulty for national conservatism and other populist movements is that tackling these problems is hard, in part because they are so bound up with things we want to keep. One example is the rising cost of healthcare in the rich world. Most high-income countries have record numbers of people living beyond 65, and their citizens are now much less likely to die from heart attacks or strokes. Inevitably, this means higher healthcare costs, but no one wants to go back to an age when cardiovascular medicine was less effective.Then there are social problems whose causes are also problems of success: depression, anxiety and falling birth rates. And here the national conservatives are not wholly wrong. We have consistent evidence that religious attendance positively correlates with greater life satisfaction. But the evidence also shows that as education levels rise, so too does atheism. Now I’m not saying there are no highly educated and economically successful religious believers. Nor should we lazily equate atheism with greater levels of liberalism and anti-populism. The UK’s major cities were, for the most part, reliable opponents of Brexit. But they are also more religious than rural areas or small towns. Nevertheless, broadly speaking, we should assume that as people and places become better educated and more technologically advanced, they will become more secular and receive fewer of the social and mental health benefits of religiosity. A similar story can be seen in falling birth rates. Most countries in the rich world have birth rates below replacement rate — that is 2.1 children per woman. Again, this is a problem of success: women have greater economic opportunities, divorce is easier, and people have both better access and encounter fewer legal barriers to contraception, both before and after conception. Yet it comes at a cost: falling birth rates mean shrinking populations and heighten the economic pressures of ageing societies. For national conservatives, whether the problem is the blues or birth rates, the solution to the downsides of secularism is more religion; and the antidote to falling birth rates is bigger subsidies for “traditional” families and stigmatisation of people whose lifestyles fall outside the two-parent norm.There are many objections one can make to this style of politics. But it also doesn’t work on its own terms. Hungary, one of the laboratories of national conservatism, still has a birth rate below replacement rate, despite giving families grants to buy new homes, as well as other tax benefits. Nonetheless, liberals should remember the quantum of insight at the heart of national conservatism: poor mental health, loneliness, social isolation and declining populations are all real problems. One frequently mooted liberal response to declining populations is simply to increase immigration, which works in the short term. But countries, like the UK, that do well at integrating migrants rapidly find that the children of immigrants experience and struggle with the same problem as those who’ve been in the country for generations. Ethnic minority Brits are, on average, more religious than white Britons: but the mixed race children of both are more liberal and more likely to be of “no religion” than any other group in the UK.Not worrying about falling birth rates in the rich world in 2023 because you can fix the problem via immigration is a bit like being relaxed about climate change in 1970 because no one in the developing world is going to buy a second gas-guzzling car. It is true now, but it is not going to remain true for long. Sooner or later, the rich world’s problems of success will become universal ones. Our difficulties in tackling climate change and other earlier problems of success should make liberals more focused on trying to identify solutions to new problems before they become global challenges. [email protected] More

The author is chief economist and deputy executive secretary of the United Nations Economic Commission for Africa African countries are facing a cost of living crisis, tightening global liquidity and worsening climate shocks. All of this is intensified by unsustainable debt burdens, which have been deepened by the devaluation of local currencies against the dollar and the US Federal Reserve’s interest rate hikes. As a result, African finance ministers are now having to make impossible choices between paying the salaries of civil servants, keeping schools and hospitals open and servicing increasingly costly debt. The current situation has serious implications for the region’s stability and the wellbeing of its citizens. In the year after the pandemic began, 62mn people in Africa were pushed into poverty — by the end of 2022, approximately 18mn more had joined their ranks. Food and fuel inflation has hit families hard, as the cost of producing basic commodities has increased. This is unfair. African countries have been buffeted by shocks that they did not create, yet they have limited involvement in the multilateral decisions that affect them. A succession of international moments in the past two years — G20 and G7 Summits, IMF and World Bank meetings — could have provided opportunities to change this dynamic but largely failed to do so. There have been some welcome initiatives. Several countries have committed additional resources to the IMF’s Poverty Reduction and Growth Facility (PRGT) and the Resilience and Sustainability Trust. World Bank members have agreed to leverage the bank’s balance sheet more effectively to lend more funds. But such commitments pale in comparison to the current need, which amounts to more than $1tn each year to address poverty and help create clean energy systems. African countries have seen the west take unprecedented steps to support Ukraine’s banks, as well as to bolster their own economies. Meanwhile, Africa has been left to wait, fuelling frustration and anger. This must change. There is an opportunity to alter this dynamic at next month’s Summit for a New Global Financial Pact. The meeting, which France will host, will aim to increase finance for sustainable development alongside specific policy commitments to mobilise those funds. The summit should deliver three discrete but significant policy shifts. First, African countries urgently require more liquidity. Advanced economies should pledge to increase their commitments to the PRGT. World Bank shareholders and management must present a plan of action to triple grants and loans to low- and middle-income countries. They should agree that the IMF special drawing rights — a reserve asset designed in the 1960s to support countries with liquidity challenges — can be used by multilateral development banks to leverage low-cost lending. The African Development Bank has presented a credible technical proposal to do this. With just $2.5bn in SDRs, the ADB could leverage $10bn in additional lending through its hybrid capital instrument. Second, countries facing debt distress require effective, timely and transparent processes for debt restructuring. The G20’s Common Framework for Debt Treatments was designed to do this, but in the two years since it was established, no restructuring has come about for Zambia and Ethiopia, while Chad came to a tentative conclusion at the end of 2022. The framework needs reforms, including an automatic standstill on debt service payments for those that apply and extended eligibility to middle-income countries. Only then can nations begin to rebuild, rather than being stuck in a repayment cycle. Third, African countries must be given a meaningful voice in these critical discussions. The entire African continent — with a population of over 1.4bn — does not have much more voting power at the IMF than Germany, which has a population of 84mn. While the current vote formula is largely based on members’ relative economic size and financial position, the majority of the institution’s operating costs are paid by developing countries through their interest payments on IMF loans. This system needs to be reformed, possibly by creating a new category that considers countries’ vulnerability to external shocks. A global financial system that is responsive and inclusive benefits everyone. If the world wants to avoid a lost decade for Africa, 2023 must be a year of action — starting with the Paris Summit for a New Global Financial Pact. More

Americans reported that their financial health had deteriorated sharply in 2022 in the face of elevated inflation, new data from the Federal Reserve on Monday showed.According to a survey published by the US central bank, the share of US adults reporting that they were “doing at least OK financially” fell to 73 per cent in 2022, down 5 percentage points from the previous year and one of the lowest readings since 2016.Nearly a third reported they were either “just getting by” or “finding it difficult to get by”.The survey, which recorded the responses of more than 11,000 people in October, found that 35 per cent of Americans said they were now worse off financially compared with a year earlier — the highest level since the question was first asked in 2014. Fed officials said unrelenting price pressures were primarily to blame, causing consumers to either stop buying certain items or switch to cheaper alternatives, and forcing them to dip into their savings. The decline in sentiment has come as the Fed has embarked on its fastest monetary tightening campaign in decades to fight stubbornly high inflation. Over the course of 2022, the central bank raised its benchmark policy rate from near-zero to nearly 4.5 per cent, repeatedly relying on jumbo 0.75 percentage point increases. Following additional rate rises in 2023, including another quarter-point increase last month, officials are now debating whether to forgo further tightening at the next policy meeting in mid-June. A large cohort of policymakers worry that there has been only limited progress so far in getting inflation down, despite signs price pressures have peaked. Employers are still hiring and consumers are still spending, albeit more conservatively than last year, fuelling concern among policymakers that the economy still retains far too much momentum. Complicating the economic outlook is uncertainty over the extent of the ongoing credit crunch, as lenders have pulled back in the wake of multiple bank failures since March. Jay Powell, the Fed chair, cited this on Friday as he hinted he might prefer to skip another rate rise at the June meeting.Speaking on Monday, Mary Daly, president of the San Francisco Fed, said the recent credit tightening was equal to roughly one or two rate increases, although she said she would be watching the data closely to determine if that estimate still holds.Daly did not state a preference for what to do about rates in June, but emphasised that balancing the risks between over-tightening and under-tightening is becoming “more and more challenging as the risks get more and more balanced”. The Fed’s survey on Monday indicated that fewer Americans reported being able to cover an unexpected $400 expense using cash, savings, or a credit card that could be immediately paid off, with only 63 per cent answering in the affirmative compared with 68 per cent the year before. Just over 10 per cent said they would not be able to cover the expense “by any means”.Moreover, 18 per cent said the largest expense they could cover with savings was under $100. Another 14 per cent said their limit was $499.Daniel Pinto, president of JPMorgan Chase, warned on Monday that the US economy is likely to tip into a recession as the Fed seeks to tackle soaring prices, which he said are “terrible for society”.“Coming from Argentina, I have lived inflation and hyperinflation,” he said at the bank’s investor day. “I can tell you that recession is a good price to pay to put inflation back to the target levels.”Additional reporting by Joshua Franklin in New York More

Speaking on CNBC, Kashkari also said services inflation remained entrenched and that “it may be that we have to go north of 6%” to get it back to the Fed’s 2% target.”I think right now, it’s a close call either way, versus raising another time in June or skipping,” Kashkari said, adding: “Important to me is not signaling that we’re done… if we skip in June.”The Fed raised its benchmark overnight rate for a 10th straight meeting this month, lifting it to a range of 5% to 5.25%.Officials in their accompanying policy statement opened the door to pausing hikes while they assess how inflation is responding and to see to what extent the recent banking system stress might add to the tightening of monetary conditions engineered by the Fed.Kashkari, a 2023 voting member of the rate-setting Federal Open Market Committee who has emerged in the last year as one of the most hawkish policymakers, said he is seeing little evidence yet in his district that the banking system ructions triggered by the collapse in March of Silicon Valley Bank had had demonstrable impact on the availability of credit.In an essay published on Monday, Kashkari reiterated a call for regulators to impose more stringent capital requirements on U.S. banks.If SVB and the other banks that recently collapsed had had “significantly more equity capital, their depositors would have been reassured because the banks could have absorbed their market-to-market losses,” Kashkari wrote.At their June 13-14 meeting, Fed officials will also provide fresh forecasts for where they see rates heading this year and through 2025. In March, the median expectation for rates this year was 5.1%, which they reached this month.Kashkari told CNBC that his projection in March was already above that level. Six other policymakers also had above-median rate forecasts for 2023, and Kashkari said he could not rule out that the policy rate may need to go above 6% if inflation, currently more than twice the Fed’s target, did not show signs of returning to 2%.”I think we’re letting inflation guide us,” he said. “It may be that we have to go north of 6%.” More

NEW YORK (Reuters) -Lillian Smith has spent about eight of the last 12 months traveling around the world, hitting France, Morocco, Japan and South Korea. Her cost for lodgings in that time? About one night in a hotel, along with the time she spent walking dogs, watering plants and changing litter boxes.  “I have always dreamed of traveling to Japan but didn’t have the budget for hotels and Airbnbs,” said the 30-year-old freelance designer from Mississippi. Her solution was to agree to house-sit, walk dogs, and care for plants for people around the globe. Economic activity has slowed in recent months, but many still yearn to quench their thirst for travel that grew out of sitting at home during the coronavirus pandemic. Travel rates are rising, and are now higher than before the pandemic, but travel-hungry consumers are finding creative ways to save money and still vacation.Some are taking road trips instead of flying or booking a budget hotel room. Others are more innovative – spending $100 to $250 for annual memberships to websites that connect them with people who need simple chores done while their dwellings are vacant. U.S. short-term rental and hotel average daily rates are about 37% and 19% higher than in April 2019, according to short-term rental and hospitality analytics firms AirDNA and STR. Consumers are trading down. Travelers (NYSE:TRV) in March booked 21 million short-term rental nights, the highest number of future nights booked on record, according to AirDNA. One-bedroom or studio in-home rentals in 2022 were 26% and 10% cheaper than hotels in large cities and coastal resorts, according to AirDNA and STR. In April, demand for budget and economy short-term rentals was up 18% and 12%, respectively, compared with the year-ago period, ahead of a 10% increase in demand for luxury rentals, AirDNA said.As of March, U.S. consumer spending on hotels and motels was up about 7.2% from a year ago, but has dropped by about 4.6% from December 2022, according to the U.S. Bureau of Economic Analysis.VACATIONS WITH CHORESSmith said she has house-sat in France, Morocco, Japan and South Korea after spending $169 on the cost of an annual membership to TrustedHousesitters, a platform that connects pet owners with in-home sitters. She estimates she has saved over $11,000 in accommodations even though she still must pay for plane tickets. “I took care of three cats and 20-plus plants while I was in Morocco, one dog in Tokyo, one dog in Kobe, and two cats in South Korea,” said Smith. U.K.-based TrustedHousesitters said its membership figures increased 12% to 160,000 in the past quarter, led by growth in the United States. Paris-based Nomador, a house-sitting platform, saw a 60% increase in new sitters from the last quarter of 2022 to the first quarter of 2023, CEO Mathilde Ferrari (NYSE:RACE) said. TrustedHousesitters said that domestic travel accounts for about 90% of all house-sits in the U.S., while Nomador said domestic travel accounts for 70% of house-sits globally.TrustedHousesitters said it advises users to check all immigration requirements before international house-sitting. Some travelers are also turning to unlimited house-swapping. U.S. company HomeExchange said membership levels in the first quarter increased 77% year over year to 110,000 and exchanges increased 63%.MORE TRAVELERS ON A BUDGET U.S. travel companies have taken notice, beefing up economy-level options to draw in growing numbers of cost-conscious travelers. Hotel operator Hilton in January announced a new economy hotel brand, Spark, aimed at budget travelers and told investors in April it was working on a lower-end extended stay brand. The goal is to attract the roughly 70 to 80 million people who travel in the economy segment, half of whom are “younger people” who can only afford lower priced hotels. “We’re not serving many of them,” said Hilton CEO Christopher Nassetta, on an investor call in April. “The opportunity is for us to get them hooked on our system early by giving them the best product that they can find in the economy space.” Travel strategist Toni McCord, 52, started house-sitting on Nomador in 2016 and now suggests the platform to her clients who are self-employed or work remotely. “People are feeling very limited in their abilities to travel because we’re in a recessive economy but when I bring up house-sitting, they’re like ‘Wait a minute, I didn’t realize that I could do something like that.'” More

MUMBAI (Reuters) – India’s economy has sustained the growth momentum seen in the last fiscal quarter of 2022/23, while latest inflation outcome has been better than forecast, the Reserve Bank of India said on Monday.Growth in the first quarter of 2023/24 is expected to be driven by private consumption, a revival in rural demand and renewed buoyancy in manufacturing on easing of input cost pressures, the central bank said in its “State of the Economy” report, published as part of its monthly bulletin.”Investment activity is also expected to improve, drawing strength from the thrust on capital expenditure in public spending and moderation in commodity prices,” it added.India’s services exports rose 13.1% on year to $30.48 billion in March, provisional RBI data showed in early May. April services exports as per provisional government data rose to $30.36 billion.The RBI said if services exports maintain their recent high momentum, the drag from net external demand should moderate through April-June 2023.”Domestic service sector activity will continue to be led by the rebound in contact-intensive services and the resilience in construction activity,” it added.Based on partial data available for April 2023 and assuming an implied GDP growth of 5.1% for Q4 of 2022/23, the economic activity index now casts GDP growth for Q1 2023/24 at 7.6%, RBI said.India’s annual retail inflation eased to 4.7% in April from 5.66% the previous month, data earlier this month showed.The RBI said the inflation momentum is turning out to be softer than anticipated on account of a fall in wheat prices, the fifth consecutive monthly decline in prices of oils and fats and the third consecutive monthly decline in the prices of eggs.”The fall in headline inflation was on account of the combined impact of monetary policy tightening, supply augmenting measures and a favourable base effect,” RBI said.India’s wholesale price based inflation fell by 0.92% from the same month a year earlier, having risen 1.34% in March.The passthrough of wholesale price movements – in deflation in April – could also contribute to the softening of retail inflation going forward, the RBI said. More

The government in March laid out a plan to boost child care over the coming three years, but did not specify how the package would be funded.”I’m not considering imposing new tax burdens, including sales tax hikes, to secure sources of funding childcare support,” Kishida told a government panel meeting including private-sector experts.Kishida has pledged to double childcare spending to reverse Japan’s dwindling birthrate. The measures aim to make it easier for both parents to work and for household chores to be shared more fairly.The government will unveil draft guidelines for implementing the childcare measures at the panel’s next meeting, Economy Minister Shigeyuki Goto told reporters, the date of which has yet to be setEarlier, some proponents for securing stable funding floated the idea of setting up a new special budget account, set aside from the state general account budget, to manage spending linked to childcare funding reforms, the Nikkei daily reported.The new account could be created through a partial merger of two existing accounts, for the welfare ministry and the childcare agency, to be run by the latter with more flexibility in earmarking spending, the Nikkei said.The new account would come on top of 13 special budgets Japan has already put in place.However, the government is struggling to secure funding for the childcare package, which some lawmakers estimate will cost around 8 trillion yen ($59.24 billion), in light of another programme to double the defence outlay over the next three years.($1 = 135.0500 yen) More