Economic downturns cause global wars

Economic downturns cause global wars

So far, such half-hearted experiments not only have failed to work; they have left the societies that have tried them in a progressively worse position, farther behind the front-runners as time goes by. Argentina has lost ground to Chile; Russian development has fallen farther behind that of the Baltic states and Central Europe. Frequently, the crisis has weakened the power of the merchants, industrialists, financiers, and professionals who want to develop a liberal capitalist society integrated into the world. Crisis can also strengthen the hand of religious extremists, populist radicals, or authoritarian traditionalists who are determined to resist liberal capitalist society for a variety of reasons. Meanwhile, the companies and banks based in these societies are often less established and more vulnerable to the consequences of a financial crisis than more established firms in wealthier societies. As a result, developing countries and countries where capitalism has relatively recent and shallow roots tend to suffer greater economic and political damage when crisis strikes--as, inevitably, it does. And, consequently, financial crises often reinforce rather than challenge the global distribution of power and wealth. This may be happening yet again. None of which means that we can just sit back and enjoy the recession. History may suggest that financial crises actually help capitalist great powers maintain their leads--but it has other, less reassuring messages as well. If financial crises have been a normal part of life during the 300-year rise of the liberal capitalist system under the Anglophone powers, so has war. The wars of the League of Augsburg and the Spanish Succession; the Seven Years War; the American Revolution; the Napoleonic Wars; the two World Wars; the cold war: The list of wars is almost as long as the list of financial crises. Bad economic times can breed wars. Europe was a pretty peaceful place in 1928, but the Depression poisoned German public opinion and helped bring Adolf Hitler to power. If the current crisis turns into a depression, what rough beasts might start slouching toward Moscow, Karachi, Beijing, or New Delhi to be born? The United States may not, yet, decline, but, if we can't get the world economy back on track, we may still have to fight.

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Texas Budget barely sustainable now

AUSTIN, Texas (AP) — Texas' share for providing health care to poor children, the impoverished elderly and the disabled is growing faster than tax revenues to pay for services, creating another state budget challenge next year, top agency officials told lawmakers Monday.? Texas' Medicaid director Billy Millwee told lawmakers that his program will likely achieve only 88 percent of the cost savings forecast in the current budget. Experts had warned lawmakers last year that they were underfunding the Medicaid program by $4.8 billion, an amount lawmakers will have to make up when they meet again next year.? Agency officials told the House Appropriation Subcommittee that the number of people qualifying for the Medicaid program nearly doubled between 2000 and 2011, and the number of poor children grew more than 10 percent in 2010 alone. The Medicaid population grows an average of 6.3 percent a year.? Monday's testimony confirmed Gov. Rick Perry's warning that Medicaid costs represent a major challenge to the state budget, and he called for lawmakers to get the program under control. But lawmakers are likely to have a hard time finding enough cuts in services and cost-savings to balance the budget when they meet again next year. The total shortfall could amount to more than $10 billion without significant changes to the program.? Last year, the Legislature cut about $15 billion in state spending and roughly $12 billion in services to balance the two-year budget. Medicaid represents about 20 percent of the state budget, and for every $1 Texas spends on the program, the federal government matches $1.47 to help cover the costs, many mandated by federal law.

Major cuts happening now to maintain budget

The Daily Texan 6/24(The Daily Texan, State budget cuts asks Texas agencies to reduce finances 24 Jun 2012) http://www.dailytexanonline.com/state/2012/06/24/state-budget-cuts-asks-texas-agencies-reduce-finances

Governor Rick Perry’s call for Texas agencies to cut spending over the next two years has prompted a statewide search for fiscal inefficiencies, a search UT will undertake in the next few months. It is currently unclear how these reductions will affect universities across Texas.? Perry and the Legislative Budget Board, a committee of the Texas Legislature that oversees budget analyses and recommendations, sent a letter June 4 directing Texas agencies to keep their 2014-15 budgets below the 2012-13 biennium expensed and budget total. It also called on state agencies to identify proposals to further reduce budgets by 10 percent. These proposals will ultimately be decided upon when the budget board meets in January.? Mary Knight, associate vice president of the UT budget office, said a 10 percent reduction for UT would amount to a $59 million cut over two years. Knight said it is unclear how UT will be affected if the Legislative Budget Board approves the reduced budget proposals.? Officials in the governor’s office said every agency in Texas is being asked to search for inefficiencies within their budgets and to propose reductions.? Knight said UT has an ongoing five-year budget planning process that involves deans from respective college and vice presidents who collaborate with the president and provost to determine strategic priorities for each unit of the University.? “At this point, the reductions are part of a planning process for next legislative session,” Knight said. “Until the legislative session begins in January of 2013, we will not have the details of how this may impact UT Austin.”? Michael Morton, president of the Senate of College Councils, said it is difficult to determine where the cuts will be made within the University at this point if the Legislature asks state institutions to cut their budgets.? In the 2011 legislative session, the Texas Legislature cut 17.5 percent of UT’s budget, or $92 million, over two years. Morton said cuts made in the last budget cycle resulted in the loss of valuable administrators and staff members. He is a member of the President’s Student Advisory Council, a group of 12 students who guide the University president in matters relating to student interests, including finances and tuition.? Morton said UT is currently already operating at minimal costs, making additional cuts especially harmful.? “There’s a lot of little things that I don’t think people realize are affected by the cuts,” Morton said. “It does take a toll on people and it does take a toll on the university because we’re receiving less and less state funding.”? A 2.6 percent tuition increase proposed by President William Powers Jr. was denied by the UT Board of Regents in May, which Morton said would have made up some of the ground lost by budget cuts.? “I supported the tuition increase of 2.6 percent,” Morton said. “It was a modest increase for the situation that we, as an institution, are in. Ultimately, I thought it was better in the long run for the institution and better for students. Obviously no one wants a tuition increase in an already poor economic climate, which is why state funding is so critical and why we need to continue to get that message heard at legislature.”? Lucy Nashed, spokeswoman for the governor’s office, said Perry has asked universities to avoid raising tuition in the future if the reduced budget proposals are approved. Nashed said Perry has been very vocal about keeping tuition rates frozen.? “Tuition shouldn’t be the first place universities look to raise to revenue,” Nashed said. “He’s still calling on universities to find deficiencies. There’s still a lot that can be done before tuition needs to be increased.”? Nashed said the governor’s overarching vision for the state is to maintain fiscal discipline and to streamline government operation. She said not raising taxes for Texas residents is one of Perry’s goals outlined for this upcoming budget cycle.? “He has asked lawmakers to keep this [goal] in mind, and now we’re just asking agencies to take a look at their budgets and see what savings they could find,” Nashed said. “It’s basically just kind of setting the stage.”

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