If current trends continue, in 10 years' time wages will be back to the brink of the abyss level of 1930. If governments opt for premature fiscal tightening, the recovery will fizzle out by 2022, says Richard Kozul-Wright, the Director Division of Globalization and Development Strategies at UNCTAD.

If current trends continue, in 10 years' time wages will be back to the brink of the abyss level of 1930. If governments opt for premature fiscal tightening, the recovery will fizzle out by 2022, says Richard Kozul-Wright, the Director Division of Globalization and Development Strategies at UNCTAD.

Transcript

Paul JayHi, I'm Paul Jay, welcome to theAnalysis.news podcast. Don't forget there's a donate buttonon the home page at theAnalysis.news, if you don't help us with a little bit of money, we can'tdo this.

United Nations Conference on Trade and Development, has released its 2020 report titled,'From Global Pandemic to Prosperity For All: Avoiding Another Lost Decade'. It's anexcellent review of our current situation and full of proposals about what to do about it.

Here are a few quotes from the document:

"The world economy is experiencing a deep recession amid a still unchecked pandemic.Now is the time to hammer out a plan for global recovery, one that can credibly return eventhe most vulnerable countries to a stronger position than they were before. The status quoante as a goal not worth the name. And the task is urgent for right now. History is repeatingitself, this time with a disturbing mix of both tragedy and farce. If governments opt forpremature fiscal tightening and attempt to bring down public debt and businesses adopt anaggressive cost-cutting strategy, in an attempt to boost exports, the recovery will likely fizzleout, with a double-dip recession and a real possibility in many countries in 2022".

Further down, the report states:

"The rise of Footloose capital and its greater freedom to move production and investmentaround the globe has over recent decades strengthened the bargaining power of capitalcompared to that of labor. This has triggered a steady increase in the share of income goingto profits that began well before the global financial crisis but continued after it. In the lastdecade, the profit share has increased in all but, three G20 countries. If these pre-COVID-19forces of wage repression remain in place, the labor share will likely continue its decline inmany economies in the next years, exacerbating inequalities. In the United States, after a50-year descent, the labor share is now back to its 1950s level. If current trends continue, in10 years time, it will be back to the brink of the abyss level of 1930".

Let me do that one again and I mean to do that one again. The wages will go down to thelevels of pre-crash in 1930.

Now joining us from Geneva to discuss the report, is its principal author, Richard Kozul-Wright. He is the Director Division of Globalization and Development Strategies at UNCTAD.That's the United Nations Conference on Trade and Development. He's the author of'Transforming Economies: Making Industrial Policy Work for Growth, Jobs, andDevelopment'. Thanks very much for joining us.

Richard Kozul-WrightThanks for the invitation, Paul.Paul JaySo we're going to do a sort of series of interviews about the report, cause it's very rich inanalysis, and I think requires more than just one podcast. I don't know how many it's going towind up being, but we're going to work our way through the report and really dig into variousparagraphs because it's a great take, I think, on how we got here, as well as some importantproposals about what to do.