United States

Agents of change: Yoxi.tv's big plan to groom do-gooders into media superstars

Topics: Innovation
Countries: Liberia, United States
Sharon Chang, left, is the founder of an intitiative to become a talent agency for social innovators. <a href="http://www.flickr.com/photos/bryanesque/3981840235/in/photostream/">Photo: bryanesque (Flickr)</a>
Sharon Chang, left, is the founder of an intitiative to become a talent agency for social innovators. Photo: bryanesque (Flickr)

It's an unlikely romance, fit for Hollywood: social change meets corporate marketing. Now, one of Tinseltown's most successful inventions is about to join the cast.

Enter the first social-entrepreneurship talent agent.

Meet Sharon Chang, founder of Yoxi.tv. The former chief creative director of 19 Entertainment, the company that produces American Idol and So You Think You Can Dance, Chang has jumped into nonprofit entrepreneurship with a totally original business model.

Yoxi, her startup, is a pro bono talent development agency for "social innovation rockstars" … sponsored by corporations looking to market themselves as do-gooders … that happens to be shooting its own "reality" show … in Liberia.

It's so complicated it just might work. A company like IBM, for example, might ask to sponsor a social innovator working on putting "big data" to use in the education sector. Yoxi might sift through their roster of promising entrepreneurs and suggest Heather Hiles of Rrripple, whose project is aligned with IBM’s brand interests. Yoxi would then use its media savvy to help Hiles and her ideas hit the big time—with IBM attaching its brand to reap marketing benefits and tap fresh ideas.

Last month, Chang explained to a Forbes columnist that she'd once toyed with a more conventional TV show along these lines, presumably an Apprentice-like contest for social innovators. But she concluded that the for-profit mass media model wasn't right for her mission:

I wanted to find fresh approaches to distribution. ...Even when you have a powerful story, it’s difficult to find an equally powerful channel. I don’t think employing celebrities should be the default and/or the only answer.

Yoxi's answer, at least for now, is to design a rigorous selection process for "social innovation rockstars"—their word for the sort of ambassadors who can catch the imagination of the public and push new ideas into the mainstream. People with great ideas and the charisma to match. Here's Yoxi spokeswoman Kasia Reterska, in an email to Global Envision:

Selection of SIRs [social innovation rockstars] happens via our research process where we rate about 14 metrics around a social entrepreneur. We measure typical attributes like the success of their organization, etc., but also focus on things like a person's charisma and media savvy. Like the notion of casting a TV show or play, we feel it's essential to find entrepreneurs who, along with a great idea, are passionate and effective communicators. These are the people who will stand out in the crowd and expedite their work in the social innovation space.

Brands can sponsor specific Rockstars. … We're just as focused on finding SIRs to help a brand via shared-value ideals as we are to harness influencers around a specific topic/entrepreneur.

In other words, Yoxi's goal is to recruit, package and promote a stable of fresh-faced innovators with useful ideas, then match each with a corporation that'd fund it in exchange for the marketing benefits. If it works, this could be the beginning of a beautiful friendship.

Diffusing a carbon bomb: tapping Canadian tar sands would hit Africa’s poor hardest

An oil pipeline to Canada's untapped Tar Sands deposits would create short-term construction jobs, but its effects on the climate could permanently destroy jobs elsewhere. Photo: <a href="http://www.flickr.com/photos/rickz/2113212191/">rickz (Flickr)</a>
An oil pipeline to Canada's untapped Tar Sands deposits would create short-term construction jobs, but its effects on the climate could permanently destroy jobs elsewhere. Photo: rickz (Flickr)

Earth to Big Oil: On a global scale, The Keystone XL pipeline would probably kill more jobs than it creates.

Proponents of the proposed pipeline from Canada’s Athabasca Tar Sands to the Gulf of Mexico claim that its construction would create jobs. But while the long-term employment prospects are debatable at best, the resulting long-term economic devastation is far more certain.

The recent decision by the Obama administration to deny a permit for the construction of the pipeline has received much press and been touted as a victory for environmentalists. But as climate activist Bill McKibben and his organization point out, stopping the extraction of the tar sands would be a victory for those far removed from the American environmental movement as well.

McKibben said in an interview with Green Prophet that “Any place that is already living close to the margins is in the greatest danger” when facing climate change.

This means the world’s poorest, already suffering from food shortages and decreased agricultural production, would be hardest hit by this carbon bomb. And scientific consensus backs up McKibben’s view.

Country Ranks, Estimated Percentage of Agricultural Productivity Loss by 2080: Potential Carbon Emissions from Canadian Oil Sands. Photo: <a href="http://www.cgdev.org/content/publications/detail/1425525">Center for Global Development</a>
Country Ranks, Estimated Percentage of Agricultural Productivity Loss by 2080: Potential Carbon Emissions from Canadian Oil Sands. Photo: Center for Global Development

David Wheeler, senior fellow emeritus of the Center for Global Development, compiled a recent study specifically tying the exploitation of the Canadian oil sands to increased agricultural losses.

Wheeler concluded that “full exploitation of Canada’s oil sands deposit would impose significant agricultural productivity losses on over 3 billion people in the developing world, and particularly in sub-Saharan Africa.” He calculates that “combustion of the Alberta deposit would increase the atmospheric concentration of CO2 by 99 ppm, or 21.3 percent of the increase already projected to occur by 2100.”

Or, as reputed climate scientist Jim Hansen of NASA put it, tapping the tar sands would be “essentially game over for the climate."

Wheeler's findings show a "game over" scenario in poor rural regions, in particular, predicting agricultural productivity losses of up to nearly 13 percent in Africa and 9 percent in Asia. Wheeler, who also created a ‘Climate Vulnerability Index’ by country, sums up his findings powerfully and succinctly, stating "Put simply, the potential destructive power in Canada’s oil sands exceeds anything modern civilization has witnessed to date."

“This new report puts into stark relief exactly what ‘game over’ looks like: Millions upon millions of starving people across the planet," says 350.org co-founder Jamie Henn.

On the ground, countries projected by Wheeler to see further damaging impacts are already struggling with agricultural losses. Another 350.org co-founder, Phil Aroneanu, told Global Envision that “we have a plethora of anecdotal and story-based thoughts from our organizers around the world” of agricultural devastation and food shortages linked to changing climate patterns.

Drought-stricken countries in the Horn of Africa, including Ethiopia and Sudan, among others, provide some of the most poignant images of climate-related suffering. An Oxfam International report points out that 85 percent of Ethiopians depend directly on agriculture. And as a local farmer told Oxfam, “The rain doesn’t come on time anymore. After we plant, the rain stops just as our crops start to grow. And it begins to rain after the crops have already been ruined.”

And with the projections from scientists like Hansen and Wheeler, Africa’s farmers and communities appear unlikely to recover soon.

While McKibben writes that “Blocking one pipeline was never going to stop global warming,” and Obama’s denial of the Keystone permit may well not kill the project in the long run, the scientific and anecdotal evidence is clear: Vulnerable populations are suffering at the hands of carbon kings already, and tapping the tar sands will exacerbate their problems.

So the Keystone proposal may or may not be dead. But the political discourse around potential job-killing has mostly left out an important aspect: the killing of crops and livelihoods elsewhere in the world.

McKibben has said that extracting Canada’s tar sands would mean lighting the “fuse to the biggest carbon bomb on the planet.” For now, at least, that fuse remains unlit.

An Incubator that Embraces the Fight Against Infant Mortality

A wax lined sleeping bag could save the lives of thousands of underweight infants born in the developing world. Photo:<a href="http://www.flickr.com/photos/branditressler/4522634814/sizes/m/in/photostream/">ladybugbkt (flickr)</a>
A wax lined sleeping bag could save the lives of thousands of underweight infants born in the developing world. Photo:ladybugbkt (flickr)

In the developing world, many children’s lives end before they have a chance to begin. The developers of Embrace—a portable and cost-effective incubator—believe they have hatched a solution to infant mortality.

With a design similar to a doll-sized sleeping bag, Embrace uses a removable wax insert that requires only hot water for heating. When the warm wax is inserted, the sleeping bag can maintain a consistent temperature of 98 degrees for 4 to 6 hours, allowing low-weight infants to maintain a warm body temperature as they would in an electronic incubator. However, unlike a traditional incubator, which on average costs a hefty $20,000, the Embrace weighs in a much lighter $100. Extensive research was done in both India and in U.S. hospitals on over 170 babies to verify Embrace’s efficacy and safety.

Today, nearly 450 infants die every hour and more than 20 million children are born premature or with a low birth weight each year . If this new product is embraced by the developing world, more will have a chance of living a meaningful life.

As international aid patterns shift, microfinance picks up the slack

Critics say developed countries have broken promises for international aid. Photo: <a href="http://www.flickr.com/photos/dfid/5491899695/">UK Department for International Development (flickr)</a>
Critics say developed countries have broken promises for international aid. Photo: UK Department for International Development (flickr)

With cause for concern about the future of international aid amid the financial crisis faced by rich countries, some developing nations find microfinance playing an increasing role in fueling local growth.

At last week's 4th High Level Forum on Aid Effectiveness in Busan, South Korea, powerful advocates including U.S. Secretary of State Hillary Clinton and U.N. Secretary-General Ban Ki-moon pressed for continued financial assistance from rich countries and better transparency for aid programs, according to the Washington Post.

But is "continued assistance" enough? Is it the kind of assistance that will lead to actual change? The European head of Oxfam International says the EU failed to take a leadership role at the summit, despite previous promises of aid allocation. Natalia Alonso says “donors are not on track to meet the Millennium Development Goals. In 2000, all rich countries recommitted to spend 0.7 percent of their national income as overseas aid by 2015, but a number of EU governments, such as Italy and Germany, are pretty far from this.” Oxfam found that amid the economic crisis, EU overall aid last year was just 0.43 percent of income, leaving a $65 billion shortfall to 56 poor countries.

It may signal more trouble for traditional international aid, the flow of cash or food aid transfers from richer to poorer countries. The economic crisis and criticisms of the summit leave the trajectory of aid in question.

As the world's wealth shifts to developing nations, some Western leaders want to be sure their aid is paying off. Former British Prime Minister Tony Blair wrote in a Washington Post opinion piece that “leaders of emerging economies must ensure that they are able to attract high-quality, sustainable investment.”

World Bank president Robert B. Zoellick also points to this shifting paradigm, stating that “the time has come to envision a world “beyond aid” – a world where the shift is from the paradigm of charity to one of mutual economic benefit.”

One way in which some developing countries are expanding local markets in the era of questionable international aid is through successful microfinance programs. While the long-term solvency of some forms of microfinance are in question, other examples point to successes engineered by both developing countries’ governments and private local banks.

Government funded cash-transfer programs in Mexico and Brazil have been recognized as quite effective at reducing poverty and spurring local market growth, The New York Times reports. These programs provide small infusions of capital to low-income residents for both entrepreneurial and cost-of-living expenses, feeding local economies. Indonesia’s state-owned Bank Rakyat has successfully demonstrated similar results in recent years through a mixed savings-credit model, according to Elisabeth Rhyne in her article, “Five countries where microfinance works,” for China Daily.

Rhyne also highlights Bolivia’s BancoSol, a for-profit bank dedicated to serving the poor that operates within a strict regulatory framework. Competition among similarly modeled microfinance banks has spurred growth with low interest rates in Bolivia. Cambodia and Mongolia are two countries where replication of the Bolivia model has allowed microfinance banks to be “market leaders and innovators,” according to Rhyne.

In Columbia, where 96 percent of businesses are small, demand for microfinance has grown fast in the years of the global financial crisis, according to IPS news. Microfinance in Columbia “grew at a steady rate of 15 percent between 2007 and 2010," states a Visión Económica study. Small companies fuel demand for microfinance because "they generally do not meet the requirements set by commercial banks,” Jorge Varón, the manager of the development credit fund of the Colombians Supporting Colombians (CAC) programme, told IPS. And in a country with so many small businesses fueling market growth, this is a divergent route from typical aid pathways.

The financial crisis hasn't killed international aid. But it has people talking about what's next. Microfinance looks like a big part of the answer.

Erik Mandell is a graduate of Middlebury College in Vermont. He is currently pursuing a master's degree in public administration and global leadership at Portland State. Read his other contributions to Global Envision.

Did a 1993 war on sky-high salaries accidentally accelerate the financial crisis?

Topics: Corporations
Countries: United States

Bill Clinton's well-meaning 1993 campaign to tie executive pay to performance may have attracted risk-loving CEOs. Photo: <a href=http://www.flickr.com/photos/worldeconomicforum/5434141708/sizes/z/in/photostream/">World Economic Forum (flickr)</a>
Bill Clinton's well-meaning 1993 campaign to tie executive pay to performance may have attracted risk-loving CEOs. Photo: World Economic Forum (flickr)

To poor countries, 2008's economic crisis must have seemed like a disease seeping from the wealthy global north. Two American thinkers have traced it to an unlikely source.

Data from World Bank
Data from World Bank

One early germ of the financial meltdown, which World Bank data show led to an unprecedented drop in foreign direct investment in the developing world and some of its slowest economic growth in a generation, may have come from a 1993 crusade against overpaid American executives, argues Daily columnist Reihan Salam.

Building on an argument by Nassim Taleb in the New York Times, Salam recalls a law championed by Bill Clinton as a way to slow rocketing executive compensation. The policy, Section 162(m), essentially capped executive salaries at publicly traded companies at $1 million annually by refusing to recognize larger salaries as a deductible business expense.

But there was an exception. Executive pay could be higher than $1 million if it were tied to performance.

Clinton's goal, reported in the New York Times in 1993, was to stop Wall Street executives from taking home "hefty amounts even when times are bad." But the effect, as shown on p. 65 of this report, was that executive compensation kept shooting up—it simply shifted from salaries to bonuses based on short-term corporate goals. This new compensation trend, in turn, helped drive out 1980s-style bankers who were "bland and predictable," as Taleb puts it, in favor of bankers who tended to be risk-loving gamblers.

Salam doesn't claim that Clinton's initiative was anything close to the only origin of the 2008 crisis. But he calls it a "cautionary example" of what can happen when you "layer new bad regulations on top of old bad regulations and call it progress."

Risk-loving gamblers, it turns out, may not be the best people to run massive corporations that can tank the global economy if they go down.

Chart by Carola Frydman and Raven E. Saks, from <a href="http://www.vanderbilt.edu/econ/sempapers/Frydman1.pdf">Historical Trends in Executive Compensation 1936-2005</a>.
Chart by Carola Frydman and Raven E. Saks, from Historical Trends in Executive Compensation 1936-2005.

As China's middle class rises, so does social discontent

A flourishing economy has enabled many Chinese citizens to climb the socio-economic ranks. Photo:<a href="http://farm4.staticflickr.com/3054/2928911826_e8754e82e2_s.jpg">xiaming (flickr)</a>
A flourishing economy has enabled many Chinese citizens to climb the socio-economic ranks. Photo:xiaming (flickr)

The spirit of 1989’s Tiananmen Square is alive in China, except the swarm of charged students has been replaced by a disgruntled, expanding middle class.

Inadvertently, an economic boom has resounded with cries for change.

2011 has been an exceptionally rough year for government officials trying to maintain social complacency across China’s far-reaching borders. Perhaps inspired by the Arab Spring, Chinese civilians took to the streets in February to enact their own “Jasmine Revolution” (taken from the Tunisian movement of the same name), demanding greater accountability and transparency from their current one-party system. At least 54 activists, including lawyers and intellectuals, were arrested, and, the New York Times reports, the term “jasmine” was blocked on internet search engines. In recent months, labor strikes have swept the People’s Republic, resulting in street rallies filled with middle class voices expressing their frustrations with meager wages and unhealthy work conditions.

However, the butterfly effect of protests—originating from the Arab Spring and expanding into the Occupy Wall Street movements—reaches beyond income inequality. Much of the Chinese middle class will no longer play the passive bystander to haphazard industrialization. On July 23rd, a high speed train collision, killing 40 passengers, moved government-backed news broadcasters to risk publicly questioning the Chinese Communist Party’s ability to provide the public with safe, accessible infrastructures.

In early August, more than 12,000 people converged in the city of Dalian to stop the re-opening of a paraxylene plant (a toxic chemical used to make polyester) after a storm had exposed citizens to chemicals known to cause leukemia and birth defects. The plant’s closure provided a significant win for the protesters—the government agreed to the shutdown despite a reported $1.5 billion invested in the industry.

In a land where censorship and submissiveness are ingrained in the cultural psyche, why are so many compelled to take a stand now? It’s a complex question, but part of the explanation lies in the problem itself: the rise of China’s economy.

Globalization, specifically global export trade, has upshot China into a leading economic powerhouse. Now the fulcrum of production in the globalized world, many Chinese workers are finally transitioning from poor to middle class (defined by The Brookings Institution as households that spend $10 per person daily).

By 2015, the Brookings Institution estimates that for the first time in 300 years, "the number of Asian middle class consumers will equal the number in Europe and North America. By 2021, on present trends, there could be more than 2 billion Asians in middle class households. In China alone, there could be over 670 million middle class consumers, compared with only perhaps 150 million today.”

The Chinese Communist Party has come to rely on the middle class for support; in the past they have served as a relatively quiet buffer between a populous but powerless poor class and a power-driven rich minority. The Economist observes that China has “kept themselves to themselves as a result of the implicit social contract offered by the Communist Party: you let us rule and we will let you get rich.”

China's middle class wants to renegotiate this contract, demanding more environmental and wellness security from their political leaders. “As many previously poor people adopt middle-class lifestyles in the decades ahead,” Brookings researchers observe, “they may find themselves not only consuming more but also more forcefully advocating for less pollution and lower emissions.” In other words, more money means more demands.

If the party chooses to reinvest its money into the people’s pockets through increased incomes, subsidized health care, lowered taxes, and environmental protection, the middle class is expected to grow by leaps and bounds in the coming years. However, one only needs to look back at China’s Great Leap Forward to see that blind fixation on economic prowess can result in a neglected, damaged social sector. Looks like China will need to take a middle-road approach if it hopes to flourish.

Does immigration help the economy?

Fortified borders, like this one seen from Calexico, Mexico, are part of measures taken to reduce the flow of migrants. Photo: <a href="http://www.flickr.com/photos/51186333@N00/316206516/"> Omar Bárcena (Flickr)</a>
Fortified borders, like this one seen from Calexico, Mexico, are part of measures taken to reduce the flow of migrants. Photo: Omar Bárcena (Flickr)

Today is not exactly a great time to be an immigrant. Though over 215 million people worldwide are first-generation migrants, more than ever before, migration is being restricted as many countries have added immigration to the list of economic burdens. Recent experience, however, suggests global migration helps grow economies and spread ideas.

Legislators in Alabama, U.S., recently passed an anti-immigration law (HB56) that prevents any undocumented immigrant from applying for work, penalizes any citizen who hires an undocumented worker, and prevents undocumented immigrants from receiving most state services. Police are able to arrest anyone they suspect to be an undocumented immigrant, a power which resulted in the recent arrest of a German Mercedes-Benz manager, who couldn't produce proper identification when stopped. European governments, grappling with an unprecedented increase in migrant populations, have passed laws restricting religious freedom, while the popularity of anti-immigration political parties is surging. In China, an acclaimed Chinese-American engineer has been jailed on dubious charges that some see as retribution for immigrating from the United States.

Behind all of these laws is a desire to make migration less attractive by making life more difficult for migrant populations. As Alabama State Representative Micky Hammon, a proponent of the anti-immigration initiative, explains, “the goal of the entire bill [is] to prevent illegal immigrants from coming to Alabama and to discourage those that are here from putting down roots." It's working. Though about 2.5 percent of Alabama’s population is undocumented, according to the Center for American Progress, tens of thousands of workers, documented and undocumented, stopped showing up for work after the law was passed.

Proponents of anti-immigration measures argue that immigrants drain government budgets by using its services without paying taxes, and causing unemployment and wage deflation by willing to work for low pay. Yet the evidence is quite flimsy. As Giovanni Peri, an economist at UC Davis who specializes in migration, writes, “on net, immigrants expand the U.S. economy’s productive capacity, stimulate investment, and promote specialization that in the long run boosts productivity. Consistent with previous research, there is no evidence that these effects take place at the expense of jobs for workers born in the United States.”

So much for being a drain on the economy. Economists at the University of Alabama have recently predicted that for every 10,000 laborers, legal and illegal, who are discouraged from working in Alabama as a result of the recent law, the state’s economy will contract by $40 million.

Aleksynska Mariya and Ahmed Tritah, economists at the University of Maine in France write that most evidence of a negative immigration effect come from studies that only examine wages and employment levels for natives in the short-run. But Mariya and Tritah remind us that immigration affects the global economy through a wide range of mechanisms. After examining these mechanisms, they conclude that immigration has a positive effect on income, labor productivity, and total factor productivity in the long run. "Studies
which focus uniquely [on] one type of effect, such as impact on employment, overlook other channels through which [the] economy adjusts to immigration."

And immigration helps developing countries as well. As The Economist writes, migrants spread ideas, information, and money while making it easier to do business across borders: “A Chinese trader in Indonesia who spots a gap in the market for cheap umbrellas will alert his cousin in Shenzhen who knows someone who runs an umbrella factory. Kinship ties foster trust, so they can seal the deal and get the umbrellas to Jakarta before the rainy season ends.” In some emerging markets institutions that foster free trade, like private property and the rule of law in general, tend to be relatively inefficient. So trust is essential to creating the confidence necessary for trade. If the government can’t ensure that you are accountable for the money I loan you, I will only do so if I know I can trust you.

Michael Clemens, senior fellow at the Center for Global Development whose research examines migration and development, discusses the effect of remittances from Haitian immigrants at home and abroad in Foreign Policy magazine:

"We can do a back-of-the-envelope calculation of what additional migration could do. Suppose the United States lets in 100,000 Haitian immigrants. First, this would dramatically raise their incomes and raise essentially all of them out of extreme poverty. Second, this would increase the size of the worldwide Haitian diaspora by 10 percent. If the new migrants remit like earlier migrants did, this would mean roughly $150 million to 180 million every year in additional remittances for Haiti... The Guardian reports that the United States has committed a one-time total of $167 million in aid. Remittances recur year after year, and unlike aid, almost the whole amount of remittances goes directly into needy families' pockets."

Migration will not solve all of our problems, and it doubtless creates many. But so do free trade and globalization, which are generally hailed as essential to modern economic growth. Why not free migration as well?

Michael Clemens was a 2011 Global Envision guest lecturer at Mercy Corps' Action Center in Portland, Oregon.

Ben Osborn is a 2011 graduate of Lewis & Clark College in Portland, Oregon. Read his other contributions to Global Envision.

Amid financial crisis, China is the new champion for carbon reduction

Industrial emissions are a major source of CO2 contributing to climate change. Photo: <a href="http://www.flickr.com/photos/un_photo/5410822714/sizes/z/in/photostream/">United Nations Photo (flickr)</a>
Industrial emissions are a major source of CO2 contributing to climate change. Photo: United Nations Photo (flickr)

The ongoing global financial crisis should not impede the fight against climate change. That's the concern coming from a surprising corner of the world: China.

As the latest round of UN-sponsored climate talks continue in Durban, South Africa, Chinese officials warn that financial hardships in Europe, the United States and elsewhere are no excuse for inaction on climate change.

With the Kyoto Protocol about to die, the global financial crisis could add another dimension to the already complex relationship between rich and poor countries when it comes to climate change.

China’s top climate official said a global pact to fight climate change should be a top priority for developed countries, even as they face severe economic challenges at home. "After the financial crisis, every country has had its problems, but these problems are just temporary," Xie Zhenhua, vice-director of the National Development and Reform Commission, told reporters, according to Reuters. He expressed concern that rich countries will break their promises to help poor ones mitigate and adapt to climate change.

According to The Economist, the vast majority of ‘climate finance’ for developing countries comes from western nations. Over $75 billion a year, or more than 75 percent of climate finance to the developing world, comes from a combination of private donors and multilateral and bilateral banks funded by taxpayers in wealthy countries. These sources have been hit the hardest by the global financial crisis.

"Climate change hasn't become less important because of the international financial crisis, but it has become less prominent," Xie said.

Developing countries, meanwhile, would be hit hardest by climate-related disasters. They lack the infrastructure and financial resources to deal with problems they have had less of a hand in causing. The 2010 climate talks in Cancun included a commitment of $30 billion to poorer nations to adapt to impacts of climate change, and an increase to $100 billion a year by 2020 for this ‘green climate fund.’ Now, says China, even the initial $30 billion commitment seems unlikely to be met.

China might seem an unlikely voice of support for carbon cuts, as it has surpassed the United States as the world’s leading producer of CO2 emissions. Under the Kyoto protocol, China was deemed an emerging economy, and not bound to the stipulations placed on developed countries. Yet China has pledged to reduce its emissions intensity by 40 to 45 percent by 2020, and hopes western countries sign on for an extension of the protocol’s commitment period. Kyoto signatories Canada and Japan have already refused to extend the protocol’s requirements. The United States has also said further negotiations are off the table.

That means the Durban discussions themselves may well determine the direction of climate funding and its impacts. And without climate action, the financial crisis could soon seem like a small-scale problem.

Erik Mandell is a graduate of Middlebury College in Vermont. He is currently pursuing a master's degree in public administration and global leadership at Portland State. Read his other contributions to Global Envision.

Bank Transfer Day: A symbolic move

Credit unions reported $80 million in saving account funds after the Nov. 5 'Bank Transfer Day.' Photo <a href="http://www.flickr.com/photos/48089670@N00/466229969/sizes/m/in/photostream/">tobym (flickr)</a>
Credit unions reported $80 million in saving account funds after the Nov. 5 'Bank Transfer Day.' Photo tobym (flickr)

Americans chose Main Street over Wall Street on the so-called 'Bank Transfer Day' on November 5. The move to credit unions didn't make a significant financial impact on big banks, but the symbolism wasn't lost.

Credit unions added 40,000 new members with a total of $80 million in savings account funds on 'Bank Transfer Day,' culminating a month of transfers that attracted 700,000 new members, according to the Credit Union National Association.

Credit unions are not-for-profit and therefore do not offer stock or pay dividends to outside stockholders. An exemption from federal income taxes also helps keep fees low, and the groups offer low interest loans and higher interest on deposits.

The financial reform package that passed in July 2010 was expected to hurt banks' bottom lines, according to the LA Times. New avenues to make a profit were sought and imposing fees on customer services that were once free or low cost have become a viable option. Since the passage of the reform, many banks have increased fees on overdrafts, ATM usage and checking accounts, making credit unions especially attractive in this tight economy.

The transfer of tens of thousands of accounts to credit unions didn’t cripple banks. Regardless, a loss of nearly one million customers in the last few months has impact. Banks will need to make up the loss. This likely isn’t the end of fees.

There's no doubt the banking system needs to be fixed. But we also must recognize that we need the services banks provide - a safe place to store our hard-earned money, a loan to buy a car, home, start a business or pay for a child’s education. The outrage we're seeing now at the lack of systemic change in the financial sector doesn't mean we're wiping our hands of lending institutions by any stretch of the imagination. But 'Bank Transfer Day' has shown us that many people are looking to different models to meet their needs, and the financial sector is taking note.

Europe's Financial Troubles Worry Neighbors

The European Central Bank looms large over the Euro debt crisis. Photo: <a href="http://www.flickr.com/photos/soumit/928182271/">soumit (flickr)</a>
The European Central Bank looms large over the Euro debt crisis. Photo: soumit (flickr)

As Europe attempts to thwart a broader global recession, it is facing what many economists refer to as a trilemma, and poorer countries could be the victims.

A financial trilemma is comprised of three goals that policy makers try to achieve: (1) a stable/fixed exchange rate; (2) an economy open to international flows of capital; and (3) a sound monetary policy to stabilize the economy.

Here's the catch: In reality you can only achieve two of these goals, not all three.

In 1999, the Eurozone decided to give up the third goal, independent monetary policy. In exchange, they enjoy a common currency across 17 member nations and the freedom to exchange money and goods across borders. Though the European Central Bank creates monetary and fiscal policy for the European Union, each member nation relinquishes its own control.

This becomes an issue when a country gets into financial trouble and must defer to the European Central Bank or greater European Union. This was recently evidenced with the bailout and continuing debt problems in Greece.

Potential for problems arise due to our ever globalized, interconnected world. Eurozone policies are far-reaching, extending their grasp to neighboring emerging markets dependent on foreign dollars. With austerity measures becoming the norm, lenders are avoiding risk and could cut foreign lending in favor of keeping business in their own backyard. The Economist references a speech by the Financial Stability Board head, Mark Carney, in which he warned about the damage if the European bank were to deleverage on the world economy.

Many emerging economies in Eastern Europe depend on both foreign aid and outside investment. If the Eurozone's financial well runs dry the effect will ripple throughout Eastern Europe, even the U.S. Poorer E.U. members worry that they'll emerge the victims. French president Nicolas Sarkozy rocked the political world after his comments at a University of Strasbourg debate on November 8, where he described a proposal for a two-speed Europe, presumably divided between richer and poorer nations.

What part does the European Central Bank (ECB) play in this? That’s the question everyone is asking. Similar to the U.S. Federal Reserve, the ECB has the power and leverage to swoop in and bail out E.U. members on the brink of collapse. They are hesitating, however. Germany feels the ECB should step in only as a last resort. Many policymakers in Germany believe that the current crisis is forcing reform and thus serving a purpose, as recently expressed in The New York Times.

With optimism waning on debt solutions for the U.S. and abroad, tensions mount and consensus becomes imperative. Politics need to be set aside before any sort of real dialogue can exist. Will the E.U. decide on a two-speed Europe? Will any countries abandon the Euro? The implications for emerging markets are considerable; several outcomes could result in global recession.

Could a 'Good Samaritan' law bridge China's growing wealth gap?

A Victorian stained glass window depiction of the "Good Samaritan" story from the Gospel of Luke.  <a href="http://www.flickr.com/photos/paullew/2566602101/">Photo: Lawrence OP (flickr)</a>
A Victorian stained glass window depiction of the "Good Samaritan" story from the Gospel of Luke. Photo: Lawrence OP (flickr)

This article was republished by The Christian Science Monitor.

The Good Samaritan of Biblical lore was different than you and me: he was able to help without the fear of being sued.

Disturbing footage of an unattended Chinese girl being run over twice and ignored by 18 witnesses has shed unflattering light on China’s civil society. Two-year-old Xiao Yueyue (which translates as Little Joy in Chinese), daughter of two migrant worker parents, died on October 21st in a Guangdong hospital, eight days after the horrific incident.

Disapproving fingers are being pointed in various directions: from the disintegration of society’s morality to the government’s neglect of protecting civil liberties. Yue Yue’s unexpected death has revived a fierce international debate over Good Samaritan laws.

If you missed the final Seinfeld episode, Good Samaritan laws protect people who assist victims of injury or crime. “They are intended to reduce bystanders' hesitation to assist, for fear of being sued or prosecuted for unintentional injury or wrongful death," as Wikipedia puts it.

Prior to the broadcasting of Yue Yue’s tragedy, several sensational lawsuits had embittered the public toward performing heroic deeds for strangers. Specifically, in 2007 an elderly woman sued a young man by the name of Peng Yu for escorting her to the hospital after she had fallen and broken her leg. Mr. Peng was ordered to pay the damages to the elder woman under the judge’s logic that the man wouldn’t have helped her unless he was guilty of injuring her in the first place. Some litigators suggest that lawsuits of this nature create legal disparity between the affluent and the less privileged. Perhaps had the woman not belonged to the poorer class, in need of money, no such lawsuit would have been filed.

A recent China Daily poll reveals that approximately 87 percent of Chinese citizens are unlikely to aid an elderly person who has fallen in the street because they want to avoid being blamed for the accident. “The public's lack of a sense of trust has been made obvious by recent media stories that have looked at the hesitation people feel before they come to someone else's aid," Xie Jing, a communications professor at Fudan University, told the newspaper.

While Good Samaritan Laws in the United States are not federally imposed, the largest jurisdictions in the United States—New York, California, and Texas—have statutes that shield voluntary assistants from liability in the case of an accident. Yet “Good Samaritans” in California and Vermont may be prosecuted if they don’t act in the medical interest of the victim. In 2007 a woman who pulled a friend out of a wrecked car, leaving the friend paralyzed, was liable to civil damages in California because “the perceived danger of remaining in the wrecked car was not "medical," the court ruled.”

One explanation for not imposing more collective responsibility on individuals: separation of morals and law.

"Our common law has always refused to transmute moral duties into legal duties,” Virginia Law Professor Charles O. Gregory noted to Time Magazine in 1965, when the killing of a woman within earshot of dozens of her neighbors prompted a national debate about civic duty. Today, every state has some form of Good Samaritan law protecting people from liability for trying to save a life, according to HeartSafe America.

In Canada, too, each province has its own set of laws concerning Good Samaritan acts. Quebec’s Charter of Rights gives citizens a "duty to rescue:" individuals must assist anyone in jeopardy, unless there is reasonable evidence that it would cause danger to himself or a third party. Abstaining from helping someone is not considered a criminal offense, since it comes from the provincial level. Yet the majority of provinces have adopted a version of the Good Samaritan Law, most of which provide some form of protection for voluntary passers-by from liability for the victim’s damages, unless it can be proven that the damages were caused by the gross negligence of the person.

In France, witnesses to a person in distress can be arrested for not intervening. A Frenchman who fails to help another when he can do so without risk is liable for up to five years in prison and fined several thousands in Euros. The French logic follows that a witness is a participant in the crime if he/she does nothing to prevent it.

In spite of the outrage bubbling in China over society’s apparent moral decline, the majority of the population is reluctant to follow in France’s footsteps. According to one online poll, 77.7 percent of Chinese respondents disagree with the idea of establishing a 'duty to rescue' law. Most claim they don’t want moral acts to be legally enforced. With restrictions on individual freedom already so tightly monitored, the Chinese appear weary to have one more government mandate imposed.

It took the death of a two-year-old girl to bring greater awareness to what it means to do the right thing. Perhaps what is most disturbing about Yue Yue’s death is the realization that an underlying current of fear has become inherently attached to what should be a visceral reaction of compassion. Had the Samaritan described by Luke in the New Testament been bound by today’s laws, perhaps he would not have been so good.

What is GDP? Short videos zoom in on a big statistic

Topics: Imports/Exports
Countries: United States

Like any extremely successful idea, the world's most widely-cited statistic has drawn a lot of critics—starting with its creator and continuing to big thinkers of the moment.

But nobody would dispute that today, gross domestic product (GDP) remains the king of indicators, an all-purpose way of estimating how things are going. And even though GDP can be faulted for assigning zero value to many important tasks—cooking dinner for your family, for example—it's a nuanced piece of social science.

Planet Money, NPR's extraordinarily earnest explanatory economics program, launched a video series at Slate V this week that breaks down the details, advantages and shortcomings of GDP. It's perfect for anyone who wants to know what economists mean when they talk about "growth."

Coffee and Job Creation, All in One Place

Topics: Corporations
Countries: United States
Previously filed under: Culture and Society
A $5 donation with your morning cup of coffee could be the first step to job creation. Photo: <a href="http://www.flickr.com/photos/robohit/2287457553/sizes/m/in/photostream/">rohobit (flickr)</a>
A $5 donation with your morning cup of coffee could be the first step to job creation. Photo: rohobit (flickr)

Would you like to create a job with that latte?

Starting today, this will be the question you’re asked the next time you step into a Starbucks for a cup of coffee. November 1st marks the beginning of the Create Jobs for USA program created by Starbucks chairman and chief executive Howard Schultz. Starbucks is partnering with the Opportunity Finance Network and community development financial institutions (CDFIs)—lending institutions that work with populations ineligible for traditional bank loans—to empower every customer to make a difference through small sum donations.

The $5 donations will provide the funding for affordable loans to small U.S. businesses that are selected by local CDFI’s to have the greatest potential to create and sustain job growth.

With nearly 7,000 stores in the US, the potential donation base is huge. And as concerns about the economy are higher than ever, the Create Jobs program is a huge step toward taking the jobs issue out of the hands of politicians and putting it in the hands of those most affected, one cup of coffee at a time.

Flexible purpose corporations stretch the meaning of charity

Topics: Corporations
Countries: United States
Benefit Corporations allow businesses, like Maine's Moo Milk Company, to align goals of social betterment with profiteering. Photo: <a href="http://www.flickr.com/photos/usnationalarchives/3815025075/">David Hiser, (Flickr)</a>
Benefit Corporations allow businesses, like Maine's Moo Milk Company, to align goals of social betterment with profiteering. Photo: David Hiser, (Flickr)

In California, profitable charity is no longer taboo.

California’s Corporate Flexibility Act, which will go into effect in January 2012, is the latest of several recent bills that establishes a new legal structure allowing profitable corporations to operate with with a stated social purpose without fear of being litigated. Most states require corporate profits to be used to the direct benefit of shareholders. Failure to maximize shareholder value, even in pursuit of environmental, social, or community betterment, can leave the organization vulnerable to lawsuits. Program-related investments are not widely used due to their legal complexities, planning and due diligence costs, and the steep penalties for any missteps in handling the investments. However, business owners and consumers alike are realizing that this old structure of categorization needs updating.

“Directors of many companies want to do the right thing, but they’re so busy looking at how not to get sued for failing to maximize profits that they don’t think more aspirationally about creating a great company that helps the planet and people and also makes money,” R. Todd Johnson, a lawyer and leading advocate for changing state legal structures, told the New York Times.

New breeds of organizations that marry profit with humanitarianism are slowly emerging across the country. "Benefit Corporations are 'a new class of corporation that allows companies to pursue profit as well as a strong social and environmental mission,'" as Venturebeat puts it. Currently six states have approved the concept: California, Virginia, Maryland, New Jersey, and Vermont. While benefit corporations also place greater emphasis on stakeholders than shareholders, this class title is more restrictive than its California's new "flexible purpose corporations." Unlike FPCs, BCs must set social and environmental goals that comply with legal definitions and directors must acknowledge the impact of corporate decisions on the community and the environment as well as their shareholders.

The third class of corporate-charitable hybrids, low profit limited liability company (L3C), have taken root in nine states. While not-for-profits are exempt from taxes, L3Cs are taxed but legally protected to accept program-related investments from private foundations and net profit. Moo Milk Company in Maine has been a notably successful L3C. In an effort to preserve local, organic milk production, Moo Milk can focus on educating their customers on local community and environmental issues without having to sacrifice financial gains.

While many support this new corporate class, others argue that the spread of these businesses will compromise the financial integrity of organizations that might otherwise register as traditional nonprofits. Hybrid corporations are not required to have a board of directors or transparent financial dealings. The New York Nonprofit Press argues that “without these and other requirements, there is a high risk that L3Cs will be fertile ground for excessive executive compensation and conflicts of interest, something prohibited by the Internal Revenue Code and regulated in charities by the IRS."

In the wake of broadening the definition of corporation, undoubtedly many kinks will need to be untangled. However, if corporations can indeed exercise both social and financial responsibility, good may take a stronger stand against greed in the marketplace.

How a home for Haitians was put to the (scientific) test

Topics: Economic Development, Innovation, Science
Countries: Haiti, United States
Previously filed under: Technology
Last year's devastating quake in Haiti created a pressing need for new, durable housing structures. Photo: Cassandra Nelson/Mercy Corps.
Last year's devastating quake in Haiti created a pressing need for new, durable housing structures. Photo: Cassandra Nelson/Mercy Corps.

Part of a Global Envision miniseries about Portland State University's effort to become the "Consumer Reports" of developing-world technology. Read the introduction.

With the specter of Haiti’s hurricane season looming, everyone involved in the 1000 Homes for Haiti project wanted to get the sustainable, earthquake-proof shelters to the island nation as soon as possible.

But there was a catch: when the houses got wet, they leaked.

The story begins with Charles Fox of Portland’s Pacific Green Innovations (PGI), who came up with the idea for the project after a trip to Haiti in 2010, when he recognized the country’s need for low-cost, sustainable and permanent housing, according to the Portland Tribune. “If you give someone a transitional house, it becomes permanent,” he told the paper. As of August, more than 600,000 Haitians were still living in makeshift housing and tent camps, according to The Christian Science Monitor.

PGI bought building panels of resin-soaked recycled paper from a German building-material manufacturer called SwissCell, which PGI's website bills as earthquake-resistant, fire resistant, weather and temperature resistant.

In June 2010, PSU students actually assembled one of PGI's model homes in a campus park. This was partially to demonstrate another of the homes’ aspects that made it seem perfect for Haiti and the developing world in general: the building panels are modular and can be assembled quickly and simply. PGI says all of the houses’ materials can be produced in Haiti by Haitians.

Things went swimmingly until a curious detail caught the eye of a PSU researcher: the home had water damage. If sitting outside in Portland made the house leak, how would it hold up amid Haitian squalls, humidity and hurricanes? To test it, they tossed some of the panels into PSU’s state-of-the-art Thermotron, a device that, according to Senior Fellow Sergio Palleroni of PSU’s Institute for Sustainable Solutions, "can create any environment on earth, any weather condition." They cranked up the heat and humidity to Haitian summertime levels, and let the panels stew for a couple of weeks.

The results confirmed their initial suspicions: Palleroni says that on average, the material lost 60 percent of its structural capacity to resist breakage. In high-wind, high-humidity conditions, the houses could actually fall apart. And for a Caribbean country far more prone to hurricanes than earthquakes—there were four in 2008 alone, according to The Guardian—that’s a big problem.

PGI stands by their product despite Palleroni's criticism. PGI’s manufacturer, Magnum Building Products, wrote in an email to Global Envision that PSU's testing may not have been reliable.

"When installed properly and finished per the guidelines also found on our website, Magnum Board structures will be in use far longer than most any other building product on the market today,” wrote Daniel Armstrong. His full response can be found below, in the comments section.

PSU researchers don’t say the houses have no use, but they don’t think they are a good permanent solution for Haiti. Palleroni pointed out that while the building materials may have passed the manufacturer’s test, they were tested as separate components; the problems showed up when they were fully assembled. PGI disagrees, with its manufacturer arguing that PSU made “no distinction as to what elements of the assembly were the primary contributor(s)" to the homes' failure.” PGI has already implemented their housing program in Haiti.

While there’s no consensus over the houses’ suitability for Haiti’s climate, the fact that there’s a debate at all is unusual. Intensive testing like the kind done at PSU is not often performed on products for the developing world. All too often, potential design problems aren’t identified until after a product is in use. Sending flawed products abroad wastes money and other resources, and in some cases the products might even hurt those that they are intended to help. Improved technologies and testing procedures allow for a longer revision period and result in better products that do more for people in need. And since that’s really the goal of humanitarian design, hopefully intensive product testing will become the norm.

Margo Conner is a senior at Lewis & Clark College in Portland, Oregon, majoring in international affairs. Read her other contributions to Global Envision.


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Social responsibility and a new world order

Washington Post - Innovations - Tue, 02/07/2012 - 07:56
Just before the New Year, the London-based Center for Economics and Business Research announced that Brazil had overtaken the United Kingdom as the world’s sixth largest economy. Furthermore, it predicted that by 2020, India and Russia will also have overtaken all the European economic powers.

Aid for trade policy rears its ugly head

The Guardian's Poverty Matters - Mon, 02/06/2012 - 01:41
The UK government's dismay at not being granted the contract for Typhoon fighter jets in India is an indication that its controversial aid for trade policy is still very much alive.

Liberia's battle to put the lights back on

The Guardian's Poverty Matters - Sun, 02/05/2012 - 23:00
Ellen Johnson Sirleaf has set ambitious targets to restore the country's electricity supply. But will it meet them by 2015?

As Africa's consumers rise, so does inequality

Yale Global Online - Fri, 02/03/2012 - 10:17
Kenya struggles to spread the wealth from rapid growth.

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