Our former Brookings colleague Rebecca Blank, now at the Commerce Department, is today leading the first meeting of the Obama Administration’s Innovation Advisory Board, looking at the innovative capacity and economic competitiveness of the United States.

I applaud the effort.  Nothing is more important to America’s longterm competitiveness than emphasizing innovation.  As the council looks to the private sector and global markets, I urge it to examine how the U.S. government can lead innovation and contribute to economic growth.  The best place to look is new and emerging digital technologies that can make government more accessible, accountable, responsive and efficient for the people who use government services every day.

Here are some of the recommendations I made in a recent paper I wrote with colleagues here at Brookings as part of our “Growth Through Innovation” initiative:

• Save money and gain efficiency by moving federal IT functions “to the cloud,” i.e., using advances in cloud computing to put software, hardware, services and data storage through remote file servers.

• Continue to prioritize the Obama administration’s existing efforts to put unparalleled amounts of data online at Data.gov and other federal sites, making it easier and cheaper for citizens and businesses to access the information they need.

• Use social media networks to deliver information to the public and to solicit feedback to improve government performance.

• Integrate ideas and operations with state and local organizations, where much of government innovation is taking place today. 

• Apply the methods of private-sector business planning to the public sector to produce region-specific business plans that are low cost and high impact.

These improvements in government services innovations in the digital age can help spur innovation and support a robust business climate.  And, as a sorely needed side benefit, they can also serve to eliminate some of the current distrust and even contempt for government that has brought public approval of the performance of the federal government to near historic lows.  

Given the lackluster healthcare exchange enrollment numbers, unaffordable coverage, and increasing overall healthcare costs, President Obama is wrong to think the Affordable Care Act (ACA) needs just a few tweaks – its most fundamental aspects need to be rethought. Obama’s essay marks the first time a modern sitting president has had a piece published in the journal.

Much of the progress made under the ACA expanding healthcare coverage to the uninsured has been thanks to increased enrollment in Medicaid -- not the exchanges -- a harbinger of even less progress to come.  Secretary of Health and Human Services Sylvia Burwell sharply adjusted down projections of new exchange enrollees in 2016 to 1.3 million. Furthermore, the Congressional Budget Office (CBO) has estimated that over the next decade, as the population increases, coverage will expand only modestly and the proportion of the uninsured will cease to decline.

Six key areas in the ACA are flawed -- and need to be fixed if healthcare reform is to meet its promise and not have rampant cost problems:

1. Subsidies still leave plans too expensive. Congress must continue income-related subsidies while making coverage affordable to both households and taxpayers, which is “no easy task” because it could drive up costs of the ACA considerably.
2. The Cadillac tax needs to be fixed. While better than nothing, it doesn’t confront the underlying problem of health insurance being tax deductible, which is regressive and inefficient. One suggestion is a modification of the Cadillac tax that makes any excess plan costs above a cap be considered taxable income to the employee, as opposed to an excise tax.
3. Increase federalism in the healthcare system. States should apply for waivers under Section 1332, which takes effect in 2017 and gives states flexibility to meet the law’s goals while retaining its basic protections. The Administration has made a serious mistake in dragging its feet and acting overly restrictively with states who could launch their own bold and far-reaching experiments, as it has itself in encouraging conservative states to expand Medicaid under the ACA.
4. The exchanges need to be the primary vehicle for health insurance – not Medicaid expansion. Equalizing the subsidy structure for exchange plans and the tax treatment of employer-sponsored benefits, more employees would go on the exchanges which gives them greater choice and portability.
5. Replace the Independent Payment Advisory Board with a premium support system for Medicare. Premium support would enforce a long-term budget for Medicare by allowing greater control of the beneficiaries themselves, as opposed to imposing payment and price controls; it would also accelerate innovation in the design and pricing of Medicare services.
6. The ACA should focus more on the “upstream” determinants of health – beyond just medical services. We need to find ways to blend health, housing, transportation, social services and other items to reduce the need for costly medical services, he writes.

If it were a separate economy, the US health system would be equivalent to the first or sixth largest economy in the world. It is both pragmatic and principled to recognize that achieving agreement on how to redesign an economy that large, or to do it successfully in 1 piece of legislation, is beyond the capabilities of the federal government. That is why core parts of the ACA need to be reassessed and revised and why empowering the US system of federalism to adapt and experiment with this law is so important.

Read "The Future of the Affordable Care Act: Reassessment and Revision."

There are a number of causes of the financial crisis that has devastated the U.S. economy and spread globally. Weakness in financial sector regulation was one of the causes and the proliferation of different regulators is, in turn, a cause of the regulatory failure. There is a bewildering, alphabet soup variety of regulators and supervisors for banks and other financial institutions that failed in their task of preventing the crisis and, at the same time, created an excessive regulatory burden on the industry because of overlapping and duplicative functions.

We can do better. This paper makes the case for a single micro prudential regulator, that is to say, one federal agency that has responsibility for the supervision and regulation of all federally chartered banks and all major non-bank financial institutions. There would still be state-chartered financial institutions covered by state regulators, but the federal regulator would share regulatory authority with the states.

The Objectives Approach to Regulation

The Blueprint for financial reform prepared by the Paulson Treasury proposed a system of objectives-based regulation, an approach that had been previously suggested and that is the basis for regulation in Australia. The White Paper prepared by the Geithner Treasury did not use the same terminology, but it is clear from the structure of the paper that their approach is essentially an objectives-based one, as they lay out the different elements of regulatory reform that should be covered. I support the objectives approach to regulation.

There should be three major objectives of regulation, as follows.

• To make sure that there is micro-prudential supervisions, so that customers and taxpayers are protected against excessive risk taking that may cause a single institution to fail.

• To make sure that whole financial sector retains its balance and does not become unstable. That means someone has to warn about the build up of risk across several institutions and perhaps take regulatory actions to restrain lending used to purchase assets whose prices are creating a speculative bubble.

• To regulate the conduct of business. That means to watch out for the interests of consumers and investors, whether they are small shareholders in public companies or households deciding whether to take out a mortgage or use a credit card.

In applying this approach, it is vital for both the economy and the financial sector that the Federal Reserve has independence as it makes monetary policy. Experience in the United States and around the world supports the view that an independent central bank results in better macroeconomic performance and restrains inflationary expectations. An independent Fed setting monetary policy is essential.

An advantage of objectives-based regulation is that it forces us to consider what are the “must haves” of financial regulation—those things absolutely necessary to reduce the chances of another crisis. Additionally we can see the “must not haves”—the regulations that would have negative effects. It is much more important to make sure that the job gets done right, that there are no gaps in regulation that could contribute to another crisis and that there not be over-regulation that could stifle innovation and slow economic growth, than it is that the boxes of the regulatory system be arranged in a particular way. In turn, this means that the issue of regulatory consolidation is important but only to the extent that it makes it easier or harder to achieve the three major objectives of regulation efficiently and effectively.

For objectives-based regulation to work, it is essential to harness the power of the market as a way to enhance stability. It will never be possible to have enough smart regulators in place that can outwit private sector participants who really want to get around regulations because they inhibit profit opportunities or because of the burdens imposed. A good regulatory environment is structured so that people who take risks stand to lose their own money if their bets do not work out. The crisis we are going through was caused by both market and regulatory failures and the market failures were often the result of a lack of transparency (“asymmetric information” in the jargon of economics). Those who invested money and lost it often did not realize the risks they were taking. To the extent that policymakers can enhance transparency, they can make market forces work better and help achieve the goal of greater stability.

Having a single micro prudential regulator would help greatly in meeting the objectives of regulation, a point that will be taken up in more detail below. It is not a new idea. In 1993-94, the Clinton and Riegle proposals for financial regulation said that a single micro prudential regulator would provide the best protection for the economy and for the industry. In the Blueprint developed by the Paulson Treasury, it was proposed that there be a single micro prudential regulator. 

Read the full paper » (pdf)

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A number of policymakers and analysts in the United States have called for countries like China and India to “do more” in the Middle East. Arguably, both Beijing and Delhi are doing more—though perhaps not in the way these advocates of greater Asian engagement in the Middle East might have wanted. President Xi Jinping recently traveled to the region and India’s Prime Minister Modi will return there over the weekend. After quick trips to Brussels for the India-EU Summit and a bilateral, as well as to Washington for the Nuclear Security Summit, Indian Prime Minister Narendra Modi will head to Riyadh tomorrow. The trip reflects not just the importance of Saudi Arabia for India but also the Middle East (or what India calls West Asia) and the opportunity this particular moment offers to Indian policymakers.

The Middle East has been crucial for India for decades. It’s been a source of energy, jobs, remittances, and military equipment, and holds religious significance for tens of millions of Indians. It’s also been a source of concern, with fears about the negative impact of regional instability on Indian interests. But today, as Modi visits, there’s also opportunity for Indian policymakers in the fact that, for a number of reasons, India is important to Saudi Arabia and a number of Middle Eastern countries in a way and to an extent that was never true before. 

It’s a two-way street

As it has globally, India has a diversified set of partnerships in the Middle East, maintaining and balancing its relationships with the Gulf Cooperation Council countries, Iran, and Israel. The region remains India’s main source of imported oil and natural gas (58 percent of its oil imports and 88 percent of its liquefied natural gas imports in 2014-15 came from the Middle East). In addition, as of January 2015, there were 7.3 million non-resident Indians in the region (64 percent of the total). These non-resident Indians remitted over $36 billion in 2015 (52 percent of the total remittances to India). Add to that India’s Sunni and Shiite populations (among the largest in the world), counter-terrorism cooperation with some countries, India’s defense relationship with Israel, the desire to connect with Afghanistan and Central Asia through Iran, and the potential market and source of capital it represents for Indian companies, and it becomes clear why this region is important for India. 

But, with many Middle Eastern countries pivoting to Asia or at least giving it a fresh look, India arguably has more leverage than it has ever had in the past. There have been a number of reasons why these countries have been looking east recently: 

• traditional strategic partnerships in flux and questions about the U.S. role in the region; 
• the economic slowdown in Europe and the U.S. following the 2008 financial crisis; 
• changing global energy consumption patterns; 
• growing concerns about terrorism in the region; 
• And, in Israel’s case, the boycott, divestment, and sanctions movement. 

In this context, India has some advantages. Its economy is doing relatively well compared to that of other countries and offers a market for goods and services, as well as potentially an investment destination. India, for example, has become Israeli defense companies’ largest foreign customer. 

Crucially for the oil and natural gas-producing states in the region, India also continues to guzzle significant—and growing—quantities of both. But, today, Delhi has buyer’s power. Why? Because oil prices are relatively low and there’s a lot of gas on the market, traditional buyers are looking elsewhere for fossil fuels or looking beyond them to cleaner energy sources. India, too, has more options and has been diversifying its sources of supply (compare India’s 74 percent dependence on the Middle East for oil in 2006-07 to the lower 58 percent that it gets from there now). 

India might still be dependent on the Middle East for energy, but now the Middle East also depends on India as a market.

Thus, India might still be dependent on the Middle East for energy, but now the Middle East also depends on India as a market. This has altered dynamics—and India’s increased leverage has been evident, for example, in the renegotiated natural gas supply deal between Qatar’s RasGas and India’s Petronet, which came with lower prices and waived penalties. Even countries like Iran, which now have more options for partners and have not hesitated to point that out to Delhi, still have an interest in maintaining their India option. Regional rivalries might have made Delhi’s balancing act in the region more complicated, but it also gives each country a reason to maintain its relationship with India. 

And the Modi government has been looking to take advantage of this situation. While its Act East policy received a lot more attention over the last couple of years—from policymakers and the press—this region hasn’t been missing from the agenda or travel itineraries. For example, Modi has traveled to the United Arab Emirates and met with Iranian President Hassan Rouhani on the sidelines of the last Shanghai Cooperation Organization conference, and the Indian president has traveled to Israel, Jordan, and the Palestinian territories. The Indian foreign minister has visited Bahrain, Israel, the Palestinian territories, Jordan, Oman, and the UAE and also participated the first ministerial meeting of the Arab-India Cooperation Forum in Manama earlier this year. The Modi government has also hosted the emir of Qatar, the crown prince of Abu Dhabi, the Bahraini, Iranian, Omani, Saudi, Syrian, and UAE foreign ministers, as well as the Israeli defense minister to India.

China’s increased activity in the region, as well as Pakistan’s engagement with Iran and the rush of European leaders to the latter, have led to calls for speedier action.

But there have been concerns that this engagement is not sufficient, particularly relative to that of some countries. For example, China’s increased activity in the region, as well as Pakistan’s engagement with Iran and the rush of European leaders to the latter, have led to calls for speedier action. The Indian foreign secretary’s recent comment that “we are no longer content to be passive recipients of outcomes” in this region also seemed to reflect the understanding that Delhi needs to be more proactive about deepening its relationships with the countries in the region, rather than waiting for them to take shape organically or just reacting to events as they occur. 

The Saudi connection

It is in this context that Modi travels to Riyadh. The relationship with Saudi Arabia is one of the key pillars of India’s Middle East policy. A major source of oil, jobs, and remittances, it is also a destination for over 400,000 Indians who go to the country for Hajj or Umra every year. In addition, in recent years, there has been more security cooperation, with Riyadh handing over individuals wanted in India and the two countries working together on countering money laundering and terrorism financing. 

The relationship has not been without problems from Delhi’s perspective. Just to list a few: 

• the Saudi-Pakistan relationship; 
• diaspora-related issues, including the treatment of Indian workers in-country and efforts towards Saudization that might limit employment opportunities for Indian expatriates;
• ideology-related concerns, particularly funding from Saudi Arabia for organizations in India, which might be increasing the influence of Wahhabism in the country; and
• regional dynamics, including Saudi Arabia’s rising tensions with Iran that has had consequences for Indian citizens, for example, in Yemen from where Delhi had to evacuate 4,640 Indians (as well as 960 foreigners).

More recently, incidents involving Saudi diplomats in India have also negatively affected (elite) public perceptions of the country, though the broader impact of this, if any, is unclear. Over the medium-to-long term, there are also concerns about potential instability within Saudi Arabia.

During Modi’s trip, however, the emphasis will be on the positives—not least in the hope that these might help alleviate some of the problems. The prime minister will be hosted by King Salman, who visited India as crown prince and defense minister just before Modi took office. He will also meet a slate of Saudi political and business leaders. The Indian wish-list will likely include diversification of economic ties, greater two-way investment, as well as more and better counter-terrorism cooperation. 

There will not be a large diaspora event—as Modi has done in Australia, Singapore, the UAE, United Kingdom, and the United States—but the prime minister will engage privately with members of the Indian community. He will also meet with Indian workers employed by an Indian company that is building part of the Riyadh metro. It is not hard to assess the reason for this particular engagement, given increased sensitivity in India (particularly in the media) about the treatment of citizens abroad, as well as the government’s interest in making a pitch for Indian companies to get greater market access. But, with Riyadh’s interest in creating jobs for Saudis, Modi will also try to highlight that Indian companies are contributing to the training and employment of locals (especially women) by visiting another Indian company’s all-female business process service center.

This will reflect the broader theme of highlighting to Riyadh and Saudis that it is not just India that benefits from the relationship—they do too. Some in India hope this has an additional effect: of giving Riyadh a reason not to let its relationship with Pakistan limit that with India, and perhaps occasionally making it willing to use some of its leverage with that country to India’s benefit. Despite recent irritants in the Saudi-Pakistan relationship, however, Delhi is realistic about the limits of weaning Riyadh away from Islamabad.

So does all this mean India will “do more” in the Middle East? For all the reasons mentioned above, the country has been involved in the region for a number of years—though, as the Indian foreign secretary has noted, this involvement was not in large part the product of active state policy. Indian interests in the region will likely increase in the future and, thus, so will its corporate and official engagement. But that engagement might not be what some American observers have in mind. As India’s capabilities grow, it might do more in terms of providing maritime security, intelligence sharing, evacuating expatriates when necessary, and contributing to U.N. peacekeeping operations. It could also potentially do more in terms of capacity building within these countries with the support of the host governments. There might also be scope for India to expand its West Asia dialogue with countries like the United States. But it will likely remain wary of picking sides or getting involved in non-U.N.-sanctioned military interventions in the region unless its interests are directly affected (the previous BJP-led coalition government did briefly consider—and then reject—joining the United States coalition in the Iraq war, for instance).

Thursday, South Africa’s highest court found President Zuma guilty of violating the constitution as he refused to reimburse the large sum of money spent on improvements to his personal home. Between 2010 and 2014, the home located in the president’s rural hometown of Nkandla received improvement which cost an estimated $23 million. The improvements include a chicken coop, an amphitheater, a swimming pool, and a helipad. President Zuma has stated that the improvements were necessary to ensure his security and should consequently be paid for with taxpayers’ money. In 2014, public prosecutor Thuli Madonsela ruled that the president should repay part of the taxpayers’ money spent on the improvements of his personal home. In refusing to do so, he violated the country’s constitution “by not complying with a decision by the public protector, the national watchdog.” The court has given the National Treasury 60 days to determine the sum the president must repay. The opposition has stated that they will seek Zuma’s impeachment.

In other South African news, this week, the rand strengthen against the U.S. dollar and reached its highest value since December 8, 2015, the day before President Zuma fired former Finance Minister Nhlanla Nene. The strengthening of the rand was coupled with the strengthening of other Emerging Markets currencies. This hike follows the statement from Federal Reserve Chair Janey Yellen, reiterating the importance to raise U.S. interest rates cautiously, amid risks in the global economy. Investors—weighting prospects of higher U.S. borrowing costs—were holding off in acquiring emerging-market assets.

This week, 17 Angolan activists were sentenced to jail time for rebellion against the government of Jose Eduardo dos Santos. The sentences ranged from two years to eight and a half years. Last June, the activists were arrested during a book club meeting focusing on Gene Sharp’s book titled From Dictatorship to Democracy: A Conceptual Framework for Liberation—a book on nonviolence and resistance to repressive regimes. Monday, the activists were charged and sentenced with acts of rebellion, planning mass action of civil disobedience, and producing fake passports, among other charges. Amnesty International has accused the Angolan court of wrongfully convicting the activists and using the judicial system to “silence dissenting views.”

Later in the week, in response to the jailing of the young activists, the Portuguese branch of hacking group Anonymous claimed the shutdown of 20 government websites, including that of the Ministry of Education and the Ministry of Labor and Social Security, among others. In a Facebook post claiming the attack, the group states, “The real criminals are outside, defended by the capitalist system that increasingly spreads in the minds of the weak.” The functionality of the websites has been restored.  

On Monday, March 28, the U.S. Millennium Challenge Corporation (MCC) withdrew $472 million in aid from the government of Tanzania after the result of the last weekend’s disputed presidential election rerun in the semi-autonomous archipelago of Zanzibar was announced. Incumbent President Ali Mohamed Shein of the ruling Chama Cha Mapinduzi party was declared the winner with 91.4 percent of the vote. However, the rerun was boycotted by the opposition Civic United Front party over the cancellation of last October’s election by the Zanzibar Electoral Commission. The commission claimed the October poll was fraudulent, while the opposition says the allegations of fraud were fabricated to thwart a victory by their candidate.

The MCC was planning a number of power and infrastructure projects in Tanzania, but its development assistance programming is conditional upon beneficiaries meeting certain standards of good governance. The MCC’s board of directors held a vote on Monday, in which they determined that Tanzania was no longer eligible to partner with the MCC given the election outcome. Although the loss of the MCC partnership is a sizable blow to the Tanzanian government, the Tanzanian finance minister appeared optimistic that the power projects would continue despite the MCC’s decision, as he stated: “We weren’t surprised at all because we were prepared for whatever the outcome. We will implement those projects using local sources of fund and the support of from other development partners.” Meanwhile, 10 out of the country’s 14 key western donors withdrew general budget support to Tanzania over the contested election.

A number of policymakers and analysts in the United States have called for countries like China and India to “do more” in the Middle East. Arguably, both Beijing and Delhi are doing more—though perhaps not in the way these advocates of greater Asian engagement in the Middle East might have wanted. President Xi Jinping recently traveled to the region and India’s Prime Minister Modi will return there over the weekend. After quick trips to Brussels for the India-EU Summit and a bilateral, as well as to Washington for the Nuclear Security Summit, Indian Prime Minister Narendra Modi will head to Riyadh tomorrow. The trip reflects not just the importance of Saudi Arabia for India but also the Middle East (or what India calls West Asia) and the opportunity this particular moment offers to Indian policymakers.

The Middle East has been crucial for India for decades. It’s been a source of energy, jobs, remittances, and military equipment, and holds religious significance for tens of millions of Indians. It’s also been a source of concern, with fears about the negative impact of regional instability on Indian interests. But today, as Modi visits, there’s also opportunity for Indian policymakers in the fact that, for a number of reasons, India is important to Saudi Arabia and a number of Middle Eastern countries in a way and to an extent that was never true before. 

It’s a two-way street

As it has globally, India has a diversified set of partnerships in the Middle East, maintaining and balancing its relationships with the Gulf Cooperation Council countries, Iran, and Israel. The region remains India’s main source of imported oil and natural gas (58 percent of its oil imports and 88 percent of its liquefied natural gas imports in 2014-15 came from the Middle East). In addition, as of January 2015, there were 7.3 million non-resident Indians in the region (64 percent of the total). These non-resident Indians remitted over $36 billion in 2015 (52 percent of the total remittances to India). Add to that India’s Sunni and Shiite populations (among the largest in the world), counter-terrorism cooperation with some countries, India’s defense relationship with Israel, the desire to connect with Afghanistan and Central Asia through Iran, and the potential market and source of capital it represents for Indian companies, and it becomes clear why this region is important for India. 

But, with many Middle Eastern countries pivoting to Asia or at least giving it a fresh look, India arguably has more leverage than it has ever had in the past. There have been a number of reasons why these countries have been looking east recently: 

• traditional strategic partnerships in flux and questions about the U.S. role in the region; 
• the economic slowdown in Europe and the U.S. following the 2008 financial crisis; 
• changing global energy consumption patterns; 
• growing concerns about terrorism in the region; 
• And, in Israel’s case, the boycott, divestment, and sanctions movement. 

In this context, India has some advantages. Its economy is doing relatively well compared to that of other countries and offers a market for goods and services, as well as potentially an investment destination. India, for example, has become Israeli defense companies’ largest foreign customer. 

Crucially for the oil and natural gas-producing states in the region, India also continues to guzzle significant—and growing—quantities of both. But, today, Delhi has buyer’s power. Why? Because oil prices are relatively low and there’s a lot of gas on the market, traditional buyers are looking elsewhere for fossil fuels or looking beyond them to cleaner energy sources. India, too, has more options and has been diversifying its sources of supply (compare India’s 74 percent dependence on the Middle East for oil in 2006-07 to the lower 58 percent that it gets from there now). 

India might still be dependent on the Middle East for energy, but now the Middle East also depends on India as a market.

Thus, India might still be dependent on the Middle East for energy, but now the Middle East also depends on India as a market. This has altered dynamics—and India’s increased leverage has been evident, for example, in the renegotiated natural gas supply deal between Qatar’s RasGas and India’s Petronet, which came with lower prices and waived penalties. Even countries like Iran, which now have more options for partners and have not hesitated to point that out to Delhi, still have an interest in maintaining their India option. Regional rivalries might have made Delhi’s balancing act in the region more complicated, but it also gives each country a reason to maintain its relationship with India. 

And the Modi government has been looking to take advantage of this situation. While its Act East policy received a lot more attention over the last couple of years—from policymakers and the press—this region hasn’t been missing from the agenda or travel itineraries. For example, Modi has traveled to the United Arab Emirates and met with Iranian President Hassan Rouhani on the sidelines of the last Shanghai Cooperation Organization conference, and the Indian president has traveled to Israel, Jordan, and the Palestinian territories. The Indian foreign minister has visited Bahrain, Israel, the Palestinian territories, Jordan, Oman, and the UAE and also participated the first ministerial meeting of the Arab-India Cooperation Forum in Manama earlier this year. The Modi government has also hosted the emir of Qatar, the crown prince of Abu Dhabi, the Bahraini, Iranian, Omani, Saudi, Syrian, and UAE foreign ministers, as well as the Israeli defense minister to India.

China’s increased activity in the region, as well as Pakistan’s engagement with Iran and the rush of European leaders to the latter, have led to calls for speedier action.

But there have been concerns that this engagement is not sufficient, particularly relative to that of some countries. For example, China’s increased activity in the region, as well as Pakistan’s engagement with Iran and the rush of European leaders to the latter, have led to calls for speedier action. The Indian foreign secretary’s recent comment that “we are no longer content to be passive recipients of outcomes” in this region also seemed to reflect the understanding that Delhi needs to be more proactive about deepening its relationships with the countries in the region, rather than waiting for them to take shape organically or just reacting to events as they occur. 

The Saudi connection

It is in this context that Modi travels to Riyadh. The relationship with Saudi Arabia is one of the key pillars of India’s Middle East policy. A major source of oil, jobs, and remittances, it is also a destination for over 400,000 Indians who go to the country for Hajj or Umra every year. In addition, in recent years, there has been more security cooperation, with Riyadh handing over individuals wanted in India and the two countries working together on countering money laundering and terrorism financing. 

The relationship has not been without problems from Delhi’s perspective. Just to list a few: 

• the Saudi-Pakistan relationship; 
• diaspora-related issues, including the treatment of Indian workers in-country and efforts towards Saudization that might limit employment opportunities for Indian expatriates;
• ideology-related concerns, particularly funding from Saudi Arabia for organizations in India, which might be increasing the influence of Wahhabism in the country; and
• regional dynamics, including Saudi Arabia’s rising tensions with Iran that has had consequences for Indian citizens, for example, in Yemen from where Delhi had to evacuate 4,640 Indians (as well as 960 foreigners).

More recently, incidents involving Saudi diplomats in India have also negatively affected (elite) public perceptions of the country, though the broader impact of this, if any, is unclear. Over the medium-to-long term, there are also concerns about potential instability within Saudi Arabia.

During Modi’s trip, however, the emphasis will be on the positives—not least in the hope that these might help alleviate some of the problems. The prime minister will be hosted by King Salman, who visited India as crown prince and defense minister just before Modi took office. He will also meet a slate of Saudi political and business leaders. The Indian wish-list will likely include diversification of economic ties, greater two-way investment, as well as more and better counter-terrorism cooperation. 

There will not be a large diaspora event—as Modi has done in Australia, Singapore, the UAE, United Kingdom, and the United States—but the prime minister will engage privately with members of the Indian community. He will also meet with Indian workers employed by an Indian company that is building part of the Riyadh metro. It is not hard to assess the reason for this particular engagement, given increased sensitivity in India (particularly in the media) about the treatment of citizens abroad, as well as the government’s interest in making a pitch for Indian companies to get greater market access. But, with Riyadh’s interest in creating jobs for Saudis, Modi will also try to highlight that Indian companies are contributing to the training and employment of locals (especially women) by visiting another Indian company’s all-female business process service center.

This will reflect the broader theme of highlighting to Riyadh and Saudis that it is not just India that benefits from the relationship—they do too. Some in India hope this has an additional effect: of giving Riyadh a reason not to let its relationship with Pakistan limit that with India, and perhaps occasionally making it willing to use some of its leverage with that country to India’s benefit. Despite recent irritants in the Saudi-Pakistan relationship, however, Delhi is realistic about the limits of weaning Riyadh away from Islamabad.

So does all this mean India will “do more” in the Middle East? For all the reasons mentioned above, the country has been involved in the region for a number of years—though, as the Indian foreign secretary has noted, this involvement was not in large part the product of active state policy. Indian interests in the region will likely increase in the future and, thus, so will its corporate and official engagement. But that engagement might not be what some American observers have in mind. As India’s capabilities grow, it might do more in terms of providing maritime security, intelligence sharing, evacuating expatriates when necessary, and contributing to U.N. peacekeeping operations. It could also potentially do more in terms of capacity building within these countries with the support of the host governments. There might also be scope for India to expand its West Asia dialogue with countries like the United States. But it will likely remain wary of picking sides or getting involved in non-U.N.-sanctioned military interventions in the region unless its interests are directly affected (the previous BJP-led coalition government did briefly consider—and then reject—joining the United States coalition in the Iraq war, for instance).

On his fourth trip to the U.S. as Indian Prime Minister, Narendra Modi will spend some quality time on Capitol Hill on Wednesday, where he'll address a joint meeting of the U.S. Congress. House Speaker Paul Ryan will also host the Indian premier for a lunch, which will be followed by a reception hosted jointly by the House and Senate Foreign Relations Committees and the India Caucus. What's the significance of this Congressional engagement and what might be Modi's message? 

Given that all the most-recent Indian leaders who've held five-year terms have addressed such joint meetings of Congress, some have asked whether Ryan's invitation to Modi is a big deal. The answer is, yes, it is an honour and not one extended all that often. Since 1934, there have been only 117 such speeches. Leaders from France, Israel and the United Kingdom have addressed joint meetings the most times (8 each), followed by Mexico (7), and Ireland, Italy and South Korea (6 each). With this speech, India will join Germany on the list with leaders having addressed 5 joint meetings of Congress: Rajiv Gandhi in 1985, P.V. Narashima Rao in 1994, Atal Bihari Vajpayee in 2000 and Manmohan Singh in 2005. India's first premier, Jawaharlal Nehru, spoke to the House and Senate in separate back-to-back sessions in 1949 as well. 

Congress is a key stakeholder in the U.S.-India relationship and can play a significant supportive or spoiler role. While American presidents have a lot more lee-way on foreign policy than domestic policy, Congress is not without influence on U.S. foreign relations, and shapes the context for American engagement abroad. Moreover, the breadth and depth of the U.S.-India relationship, as well as the blurring of the line between what constitutes domestic and foreign policy these days means that India's options can be affected by American legislative decisions or the political mood on a range of issues from trade to immigration, energy to defense. 

The Indian Foreign Secretary recently said that the U.S. legislature was at "very much at the heart" of the relationship today. He noted it has been "very supportive" and "even in some more difficult days where actually the Congress has been the part of the US polity which has been very sympathetic to India." But India's had rocky experiences on the Hill as well--which only heightens the need to engage members of Congress at the highest levels. 

The speech and the other interactions offer Modi an opportunity to acknowledge the role of Congress in building bilateral relations, highlight shared interests and values, outline his vision for India and the relationship, as well as tackle some Congressional concerns and note some of India's own. He'll be speaking to multiple audiences in Congress, with members there either because of the strategic imperative for the relationship, others because of the economic potential, yet others because of the values imperative--and then there are those who'll be there because it is important to their constituents, whether business or the Indian diaspora. There is also the audience outside Congress, including in India, where the speech will play in primetime. What will Modi's message be? A glimpse at previous speeches might offer some clues, though Modi is likely also to want to emphasize change. 

The speeches that came before

The speeches of previous prime ministers have addressed some common themes. They've acknowledged shared democratic values. They've mentioned the two-way flow of inspiration and ideas with individuals like Henry David Thoreau, Mahatma Gandhi, Martin Luther King getting multiple mentions. They've noted the influence of American founding documents or fathers on the Indian constitution. They've highlighted India's achievements, while stressing that much remains to be done. 

They've noted their country's diversity, and the almost-unique task Indian leaders have had--to achieve development for hundreds of millions in a democratic context. Since Gandhi, each has mentioned the Indian diaspora, noting its contributions to the U.S. Each prime minister has also expressed gratitude for American support or the contribution the U.S. partnership has made to India's development and security. They've acknowledged differences, without dwelling on them. They've addressed contemporary Congressional concerns that existed about Indian policy--in some cases offering a defense of them, in others' explaining the reason behind the policy.

Many of the premiers called for Congress to understand that India, while a democracy like the U.S. and sharing many common interests, would not necessarily achieve its objectives the same way as the U.S. And each subtly has asked for time and space, accommodation and support to achieve their goals--and argued it's in American interests to see a strong, stable, prosperous, democratic India.

In terms of subjects, each previous speech has mentioned economic growth and development as a key government priority, highlighting what policymakers were doing to achieve them. Since Gandhi, all have mentioned nuclear weapons though with different emphases: he spoke of disarmament; Rao of de-nuclearization and concerns about proliferation; two years after India's nuclear test, Vajpayee noted India's voluntary moratorium on testing and tried to reassure Congress about Indian intentions; and speaking in the context of the U.S.-India civil nuclear talks, Singh noted the importance of civil nuclear energy and defended India's track record on nuclear non-proliferation.

Since Rao, every prime minister has mentioned the challenge that terrorism posed for both the U.S. and India, with Vajpayee and Singh implicitly noting the challenge that a neighboring country poses in this regard from India's perspective. And Rao and Singh made the case for India to get a permanent seat on the U. N. Security Council.

The style of the speeches has changed, as has the tone. Earlier speeches were littered with quotes from sources like Christopher Columbus, Swami Vivekananda, Abraham Lincoln, Lala Lajpat Rai and the Rig Veda. Perhaps that was reflective of the style of speechwriting in those eras, but perhaps it was also because there were fewer concrete issues in the bilateral relationship to address. The evolution in the areas of cooperation is evident in the speeches. 

Rao's speech about two decades ago, for instance, listed U.S.-India common interests as peacekeeping, environmental crises, and combating international terrorism and international narcotics trafficking. Compare that to Singh's address which talked of cooperation on a range of issues from counterterrorism, the economy, agriculture, energy security, healthy policy, humanitarian assistance and disaster relief (HADR), democracy promotion, and global governance.

The speech yet to come

Modi will likely strike some similar themes, acknowledging the role that the U.S. Congress has played in shaping the relationship and expressing gratitude for its support. Like Vajpayee, particularly in a U.S. election year, Modi might note the bipartisan support the relationship has enjoyed in recent years. He'll undoubtedly talk about shared democratic values in America's "temple of democracy"--a phrase he used for the Indian parliament when he first entered it after his 2014 election victory. Modi will not necessarily mention the concerns about human rights, trade and investment policies, non-proliferation or India's Iran policy that have arisen on the Hill, but he will likely address them indirectly. 

For example, by emphasizing India's pluralism and diversity and the protection its Constitution gives to minorities, or the constructive role the country could play regionally (he might give examples such as the recently inaugurated dam in Afghanistan). Given the issues on the bilateral agenda, he'll likely mention the strategic convergence, his economic policy plans, terrorism, India's non-proliferation record, defense and security cooperation, and perhaps--like Vajpayee--the Asia-Pacific (without directly mentioning China). And like Vajpayee, he might be more upfront about Indian concerns and the need to accommodate them. 

While he might strike some similar themes as his predecessors and highlight aspects of continuity, Modi will also want to emphasize that it's not business as usual. He'll likely try to outline the change that he has brought and wants to bring. In the past, he has noted the generational shift that he himself represents as the first Indian prime minister born after independence and the Modi government's latest tag line is, of course, "Transforming India." And he might emphasize that this changed India represents an opportunity for the U.S.

He won't wade directly into American election issues, but might note the importance of U.S. global engagement. He might also try to address some of the angst in the U.S. about other countries taking advantage of it and being "takers." He could do this by making the case that India is not a free rider--that through its businesses, market, talent and diaspora it is contributing to American economy and society, through its economic development it will contribute to global growth, and through Indian prosperity, security and a more proactive international role--with a different approach than another Asian country has taken--it'll contribute to regional stability and order. He might also suggest ways that the U.S. can facilitate India playing such a role.

Unlike previous leaders, he has not tended to appeal to others not to ask India to do more regionally and globally because it's just a developing country and needs to focus internally. The Modi government has been highlighting the contributions of India and Indians to global and regional peace and prosperity--through peacekeeping, the millions that fought in the World Wars, HADR operations in its neighborhood, evacuation operations in Yemen in which it rescued not just Indian citizens, but Americans as well.

His government has been more vocal in joint contexts of expressing its views on the importance of a rules-based order in the Asia-Pacific and Indian Ocean regions--and we might hear more on this in his address. Overall, a theme will likely be that India is not just a "taker," and will be a responsible, collaborative stakeholder.

It'll be interesting to see whether the Indian prime minister notes the role that his predecessors have played in getting the relationship to this point. With some exceptions--for example, he acknowledged Manmohan Singh's contribution during President Obama's visit to India last year--he has not tended to do so. But there's a case to be made for doing so--it can reassure members of Congress that the relationship transcends one person or party and is based on a strategic rationale, thus making it more sustainable. Such an acknowledgement could be in the context of noting that it's not just Delhi and Washington that have built and are building this relationship, but the two countries' states, private sectors, educational institutions and people. 

This wouldn't prevent Modi from highlighting the heightened intensity of the last two years, particularly the progress in defense and security cooperation. (From a more political perspective, given that there has been criticism in some quarters of India-U.S. relations becoming closer, it can also serve as a reminder that the Congress party-led government followed a similar path).

Modi will be competing for media attention in the U.S. thanks to the focus in the U.S. on the Democratic primaries this week, but he'll have Congressional attention. But it's worth remembering that Indian prime ministers have been feted before, but if they don't deliver on the promise of India and India-U.S. relations that they often outline, disillusionment sets in. Modi will have to convince them that India is a strategic bet worth making--one that will pay off.

This piece was originally published by Huffington Post India.

On his fourth trip to the U.S. as Indian Prime Minister, Narendra Modi will spend some quality time on Capitol Hill on Wednesday, where he'll address a joint meeting of the U.S. Congress. House Speaker Paul Ryan will also host the Indian premier for a lunch, which will be followed by a reception hosted jointly by the House and Senate Foreign Relations Committees and the India Caucus. What's the significance of this Congressional engagement and what might be Modi's message? 

Given that all the most-recent Indian leaders who've held five-year terms have addressed such joint meetings of Congress, some have asked whether Ryan's invitation to Modi is a big deal. The answer is, yes, it is an honour and not one extended all that often. Since 1934, there have been only 117 such speeches. Leaders from France, Israel and the United Kingdom have addressed joint meetings the most times (8 each), followed by Mexico (7), and Ireland, Italy and South Korea (6 each). With this speech, India will join Germany on the list with leaders having addressed 5 joint meetings of Congress: Rajiv Gandhi in 1985, P.V. Narashima Rao in 1994, Atal Bihari Vajpayee in 2000 and Manmohan Singh in 2005. India's first premier, Jawaharlal Nehru, spoke to the House and Senate in separate back-to-back sessions in 1949 as well. 

Congress is a key stakeholder in the U.S.-India relationship and can play a significant supportive or spoiler role. While American presidents have a lot more lee-way on foreign policy than domestic policy, Congress is not without influence on U.S. foreign relations, and shapes the context for American engagement abroad. Moreover, the breadth and depth of the U.S.-India relationship, as well as the blurring of the line between what constitutes domestic and foreign policy these days means that India's options can be affected by American legislative decisions or the political mood on a range of issues from trade to immigration, energy to defense. 

The Indian Foreign Secretary recently said that the U.S. legislature was at "very much at the heart" of the relationship today. He noted it has been "very supportive" and "even in some more difficult days where actually the Congress has been the part of the US polity which has been very sympathetic to India." But India's had rocky experiences on the Hill as well--which only heightens the need to engage members of Congress at the highest levels. 

The speech and the other interactions offer Modi an opportunity to acknowledge the role of Congress in building bilateral relations, highlight shared interests and values, outline his vision for India and the relationship, as well as tackle some Congressional concerns and note some of India's own. He'll be speaking to multiple audiences in Congress, with members there either because of the strategic imperative for the relationship, others because of the economic potential, yet others because of the values imperative--and then there are those who'll be there because it is important to their constituents, whether business or the Indian diaspora. There is also the audience outside Congress, including in India, where the speech will play in primetime. What will Modi's message be? A glimpse at previous speeches might offer some clues, though Modi is likely also to want to emphasize change. 

The speeches that came before

The speeches of previous prime ministers have addressed some common themes. They've acknowledged shared democratic values. They've mentioned the two-way flow of inspiration and ideas with individuals like Henry David Thoreau, Mahatma Gandhi, Martin Luther King getting multiple mentions. They've noted the influence of American founding documents or fathers on the Indian constitution. They've highlighted India's achievements, while stressing that much remains to be done. 

They've noted their country's diversity, and the almost-unique task Indian leaders have had--to achieve development for hundreds of millions in a democratic context. Since Gandhi, each has mentioned the Indian diaspora, noting its contributions to the U.S. Each prime minister has also expressed gratitude for American support or the contribution the U.S. partnership has made to India's development and security. They've acknowledged differences, without dwelling on them. They've addressed contemporary Congressional concerns that existed about Indian policy--in some cases offering a defense of them, in others' explaining the reason behind the policy.

Many of the premiers called for Congress to understand that India, while a democracy like the U.S. and sharing many common interests, would not necessarily achieve its objectives the same way as the U.S. And each subtly has asked for time and space, accommodation and support to achieve their goals--and argued it's in American interests to see a strong, stable, prosperous, democratic India.

In terms of subjects, each previous speech has mentioned economic growth and development as a key government priority, highlighting what policymakers were doing to achieve them. Since Gandhi, all have mentioned nuclear weapons though with different emphases: he spoke of disarmament; Rao of de-nuclearization and concerns about proliferation; two years after India's nuclear test, Vajpayee noted India's voluntary moratorium on testing and tried to reassure Congress about Indian intentions; and speaking in the context of the U.S.-India civil nuclear talks, Singh noted the importance of civil nuclear energy and defended India's track record on nuclear non-proliferation.

Since Rao, every prime minister has mentioned the challenge that terrorism posed for both the U.S. and India, with Vajpayee and Singh implicitly noting the challenge that a neighboring country poses in this regard from India's perspective. And Rao and Singh made the case for India to get a permanent seat on the U. N. Security Council.

The style of the speeches has changed, as has the tone. Earlier speeches were littered with quotes from sources like Christopher Columbus, Swami Vivekananda, Abraham Lincoln, Lala Lajpat Rai and the Rig Veda. Perhaps that was reflective of the style of speechwriting in those eras, but perhaps it was also because there were fewer concrete issues in the bilateral relationship to address. The evolution in the areas of cooperation is evident in the speeches. 

Rao's speech about two decades ago, for instance, listed U.S.-India common interests as peacekeeping, environmental crises, and combating international terrorism and international narcotics trafficking. Compare that to Singh's address which talked of cooperation on a range of issues from counterterrorism, the economy, agriculture, energy security, healthy policy, humanitarian assistance and disaster relief (HADR), democracy promotion, and global governance.

The speech yet to come

Modi will likely strike some similar themes, acknowledging the role that the U.S. Congress has played in shaping the relationship and expressing gratitude for its support. Like Vajpayee, particularly in a U.S. election year, Modi might note the bipartisan support the relationship has enjoyed in recent years. He'll undoubtedly talk about shared democratic values in America's "temple of democracy"--a phrase he used for the Indian parliament when he first entered it after his 2014 election victory. Modi will not necessarily mention the concerns about human rights, trade and investment policies, non-proliferation or India's Iran policy that have arisen on the Hill, but he will likely address them indirectly. 

For example, by emphasizing India's pluralism and diversity and the protection its Constitution gives to minorities, or the constructive role the country could play regionally (he might give examples such as the recently inaugurated dam in Afghanistan). Given the issues on the bilateral agenda, he'll likely mention the strategic convergence, his economic policy plans, terrorism, India's non-proliferation record, defense and security cooperation, and perhaps--like Vajpayee--the Asia-Pacific (without directly mentioning China). And like Vajpayee, he might be more upfront about Indian concerns and the need to accommodate them. 

While he might strike some similar themes as his predecessors and highlight aspects of continuity, Modi will also want to emphasize that it's not business as usual. He'll likely try to outline the change that he has brought and wants to bring. In the past, he has noted the generational shift that he himself represents as the first Indian prime minister born after independence and the Modi government's latest tag line is, of course, "Transforming India." And he might emphasize that this changed India represents an opportunity for the U.S.

He won't wade directly into American election issues, but might note the importance of U.S. global engagement. He might also try to address some of the angst in the U.S. about other countries taking advantage of it and being "takers." He could do this by making the case that India is not a free rider--that through its businesses, market, talent and diaspora it is contributing to American economy and society, through its economic development it will contribute to global growth, and through Indian prosperity, security and a more proactive international role--with a different approach than another Asian country has taken--it'll contribute to regional stability and order. He might also suggest ways that the U.S. can facilitate India playing such a role.

Unlike previous leaders, he has not tended to appeal to others not to ask India to do more regionally and globally because it's just a developing country and needs to focus internally. The Modi government has been highlighting the contributions of India and Indians to global and regional peace and prosperity--through peacekeeping, the millions that fought in the World Wars, HADR operations in its neighborhood, evacuation operations in Yemen in which it rescued not just Indian citizens, but Americans as well.

His government has been more vocal in joint contexts of expressing its views on the importance of a rules-based order in the Asia-Pacific and Indian Ocean regions--and we might hear more on this in his address. Overall, a theme will likely be that India is not just a "taker," and will be a responsible, collaborative stakeholder.

It'll be interesting to see whether the Indian prime minister notes the role that his predecessors have played in getting the relationship to this point. With some exceptions--for example, he acknowledged Manmohan Singh's contribution during President Obama's visit to India last year--he has not tended to do so. But there's a case to be made for doing so--it can reassure members of Congress that the relationship transcends one person or party and is based on a strategic rationale, thus making it more sustainable. Such an acknowledgement could be in the context of noting that it's not just Delhi and Washington that have built and are building this relationship, but the two countries' states, private sectors, educational institutions and people. 

This wouldn't prevent Modi from highlighting the heightened intensity of the last two years, particularly the progress in defense and security cooperation. (From a more political perspective, given that there has been criticism in some quarters of India-U.S. relations becoming closer, it can also serve as a reminder that the Congress party-led government followed a similar path).

Modi will be competing for media attention in the U.S. thanks to the focus in the U.S. on the Democratic primaries this week, but he'll have Congressional attention. But it's worth remembering that Indian prime ministers have been feted before, but if they don't deliver on the promise of India and India-U.S. relations that they often outline, disillusionment sets in. Modi will have to convince them that India is a strategic bet worth making--one that will pay off.

This piece was originally published by Huffington Post India.

Event Information

With many national economies slipping back into recession and voters in Greece, France and the United Kingdom rejecting austerity measures in recent elections, the European political and economic landscape has shifted again. Europe now seems headed towards a revised social contract and a new round of negotiations to respond to the continuing financial crisis. The United States, while experiencing a mild recovery, also strives to find the right balance between fiscal consolidation and growth preservation—a mission made more challenging with the upcoming November elections. A new loss of confidence in Europe may well imperil the U.S. economy’s fragile recovery. Will similar anti-austerity political currents cross the Atlantic and bring "change" to the United States? Despite the crisis, transatlantic cooperation has increased during the Obama administration, but U.S.-EU relations will be subjected to critical examination during the election year.

On May 23, the same day European leaders will gather for an extraordinary summit in Brussels, the Center on the United States at Brookings (CUSE) and the Heinrich Böll Foundation hosted a discussion featuring experts and top officials from both sides of the Atlantic for the 2012 CUSE Annual Conference. Panelists explored critical issues shaping the future of transatlantic relations in a year of elections and political transitions, from the euro crisis and the future of NATO to relations with Russia, Turkey and the Middle East.

After each panel, participants took audience questions.

The event is available in full on C-SPAN »

Video

• NATO in Afghanistan: In Together, Out Together
• U.S. Has Enormous Stake in Euro Crisis
• U.S., European Allies United on Iran
• U.S. Will Move Forward with Russia on Areas of Mutual Interest

Audio

• Visions of Europe in an Election Year: Part 1
• Visions of Europe in an Election Year: Part 2
• Visions of Europe in an Election Year: Part 3

Transcript

• Intro And Remarks With Phillip Gordon (.pdf)
• Panel One Transcript (.pdf)
• Panel Two Transcript (.pdf)
• Complete Transcript (.pdf)

Event Materials

• 20120523_europe_visions_gordon_transcript_corrected
• 20120523_europe_visions_panel_one_corrected
• 20120523_europe_visions_panel_two_corrected
• 20120523_europe_visions_complete_corrected

Each year, one in five households filing a federal income tax return claims the Earned Income Tax Credit (EITC). Targeted primarily to lower-income workers with children, it is one of many credits and deductions filers take each year on their federal income tax forms. However, unlike typical credits and deductions, the EITC is a refundable credit, meaning that after offsetting what is owed to the government filers receive the remainder of the benefit as a refund.

By supplementing earnings for low- and moderate-income households, the EITC helps bridge the gap between what the labor market provides and what it takes to support a family. It encourages and rewards work and has become one of the nation’s largest and most effective anti-poverty programs. In contrast to other work support and poverty alleviation programs, it achieves this with very little bureaucracy beyond what otherwise exists to administer the tax code.

Although the EITC began in 1975 as a small credit (no more than $400), a number of targeted expansions in subsequent years mean that today the EITC’s assistance can be considerable. In 2015, a single parent with three children working full-time all year at the federal minimum wage ($7.25 an hour) is eligible for a credit of $6,242, a boost of more than 40 percent above her earnings of $15,080 (though combined it still leaves her 12 percent below the federal poverty level).

However, the only way to obtain these substantial benefits is to claim the EITC on the annual federal income tax return. While lump-sum payments have perceived benefits (such as being able to pay off debts, make larger purchases, or force savings), the EITC’s single annual disbursement can present a challenge for the working parent trying to make ends meet throughout the year. It can also be problematic for households wanting to stretch out their refund as an emergency savings reserve.

My 2008 paper, “Periodic Payment of the Earned Income Tax Credit,” proposed an option that would allow a family to receive a portion of the EITC outside of tax time, striking a balance between lump-sum delivery and the need for resources throughout the year. Specifically, half of the credit could be claimed in four payments spread out during the year, while the remaining credit would continue to be paid as part of the tax refund.

Since then, several significant developments have occurred. A little-used option for receiving some of the EITC in each paycheck ended in 2010. In 2014, the federal government initiated a new tax credit advance payment process to subsidize health insurance premiums through monthly disbursement of the Affordable Care Act’s Premium Tax Credit. Other countries providing assistance similar to the EITC have continued to innovate and offer access to benefits during the year. Finally, members of Congress and think tanks have proposed alternatives to a single lump-sum disbursement of the EITC, and others have begun to explore and experiment with alternatives, most notably in Chicago, where a 2014 pilot program made quarterly payments to 343 households.

In light of these developments, this paper reviews the author’s original EITC periodic payment proposal, examines emerging alternatives, and addresses the following key questions:

• What is the demand for periodic payment alternatives?
  
  
• What benefits will accrue from the availability of periodic payment?
  
  
• What risks are associated with periodic payment and how can they be managed?
  
  
• What is the administrative feasibility of periodic payment?

The emerging answers point a way forward for identifying different distribution options that would enhance the EITC’s value to low- and moderate-income working families.

Downloads

• Report

Exactly one year after U.S. Secretary of State John Kerry’s last multi-country tour of sub-Saharan Africa, he is preparing for another visit to the continent—to Kenya and Djibouti from May 3 to 5, 2015. In Kenya, Kerry and a U.S. delegation including Linda Thomas-Greenfield, assistant secretary of state for African affairs, will engage in talks with senior Kenyan officials on U.S.-Kenya security cooperation, which the U.S. formalized through its Security Governance Initiative (SGI) at the U.S.-Africa Leaders Summit last August. Over the past several years, the U.S. has increased its military assistance to Kenya and African Union (AU) troops to combat the Somali extremist group al-Shabab and has conducted targeted drone strikes against the group’s top leaders.  In the wake of the attack on Kenya’s Garissa University by al-Shabab, President Obama pledged U.S. support for Kenya, and Foreign Minister Amina Mohamed has stated that Kenya is currently seeking additional assistance from the U.S. to strengthen its military and intelligence capabilities.

Kerry will also meet with a wide array of leaders from Kenya’s private sector, civil society, humanitarian organizations, and political opposition regarding the two countries’ “common goals, including accelerating economic growth, strengthening democratic institutions, and improving regional security,” according to a U.S. State Department spokesperson. These meetings are expected to build the foundation for President Obama’s trip to Kenya for the Global Entrepreneurship Summit in July of this year.

On Tuesday, May 5, Kerry will become the first sitting secretary of state to travel to Djibouti. There, he will meet with government officials regarding the evacuation of civilians from Yemen and also visit Camp Lemonnier, the U.S. military base from which it coordinates its counterterror operations in the Horn of Africa region.

This week saw the proliferation of anti-government street demonstrations as current President Pierre Nkurunziza declared his candidacy for a third term, after being in office for ten years.  The opposition has deemed this move as “unconstitutional” and in violation of the 2006 Arusha peace deal which ended the civil war. Since the announcement, hundreds of civilians took to the streets of Bujumbura, despite a strong military presence. At least six people have been killed in clashes between police forces and civilians. 

Since the protests erupted, leading human rights activist Pierre-Claver Mbonimpa has been arrested alongside more than 200 protesters. One of Burundi’s main independent radio stations was also suspended as they were covering the protests.  On Wednesday, the government blocked social media platforms, including Twitter and Facebook, declaring them important tools in implementing and organizing protests. Thursday, amid continuing political protests, Burundi closed its national university and students were sent home. 

Amid the recent protests, Burundi’s constitutional court will examine the president’s third term bid. Meanwhile, U.N. secretary general Ban Ki-moon has sent his special envoy for the Great Lakes Region to hold a dialogue with president Nkurunziza and other government authorities. Senior U.S. diplomat Tom Malinowski also arrived in Bujumbura on Thursday to help defuse the biggest crisis the country has seen in the last few years, expressing disappointment over Nkurunziza’s decision to run for a third term.

Since the early 2000s, China has become an increasingly significant source of financing for African infrastructure projects, as noted in a recent Brookings paper, “Financing African infrastructure: Can the world deliver?” This week, observers have seen an additional spike in African infrastructure investments from Chinese firms, as three major railway, real estate, and other infrastructure deals were struck on the continent, totaling nearly $7.5 billion in investments.

On Monday, April 27, the state-owned China Railway Construction Corp announced that it will construct a $3.5 billion railway line in Nigeria, as well as a $1.9 billion real estate project in Zimbabwe. Then on Wednesday, the Industrial and Commercial Bank of China (one of the country’s largest lenders) signed a $2 billion deal with the government of Equatorial Guinea in order to carry out a number of infrastructure projects throughout the country. These deals align with China’s “One Belt, One Road” strategy of building infrastructure in Africa and throughout the developing world in order to further integrate their economies, stimulate economic growth, and ultimately increase demand for Chinese exports. For more insight into China’s infrastructure lending in Africa and the implications of these investments for the region’s economies, please see the following piece by Africa Growth Initiative Nonresident Fellow Yun Sun: “Inserting Africa into China’s One Belt, One Road strategy: A new opportunity for jobs and infrastructure?”

Last night, retired lieutenant general Michael Flynn addressed the Republican convention as a headline speaker on the subject of national security. One of Donald Trump’s closest advisors—so much so that he was considered for vice president—Flynn repeated many of the themes found in his new book, The Field of Fight, How We Can Win the Global War Against Radical Islam and Its Allies, which he coauthored with Michael Ledeen. (The book is published by St. Martin’s, which also published mine.)

Written in Flynn’s voice, the book advances two related arguments: First, the U.S. government does not know enough about its enemies because it does not collect enough intelligence, and it refuses to take ideological motivations seriously. Second, our enemies are collaborating in an “international alliance of evil countries and movements that is working to destroy” the United States despite their ideological differences.

Readers will immediately notice a tension between the two ideas. “On the surface,” Flynn admits, “it seems incoherent.” He asks: 

“How can a Communist regime like North Korea embrace a radical Islamist regime like Iran? What about Russia’s Vladimir Putin? He is certainly no jihadi; indeed, Russia has a good deal to fear from radical Islamist groups.” 

Flynn spends much of the book resolving the contradiction and proving that America’s enemies—North Korea, China, Russia, Iran, Syria, Cuba, Bolivia, Venezuela, Nicaragua, al-Qaida, Hezbollah, and ISIS—are in fact working in concert.

No one who has read classified intelligence or studied international relations will balk at the idea that unlikely friendships are formed against a common enemy. As Flynn observes, the revolutionary Shiite government in Tehran cooperates with nationalist Russia and communist North Korea; it has also turned a blind eye (at the very least) to al-Qaida’s Sunni operatives in Iran and used them bargaining chips when negotiating with Osama bin Laden and the United States. 

Flynn argues that this is more than “an alliance of convenience.” Rather, the United States’ enemies share “a contempt for democracy and an agreement—by all the members of the enemy alliance—that dictatorship is a superior way to run a country, an empire, or a caliphate.” Their shared goals of maximizing dictatorship and minimizing U.S. interference override their substantial ideological differences. Consequently, the U.S. government must work to destroy the alliance by “removing the sickening chokehold of tyranny, dictatorships, and Radical Islamist regimes.” Its failure to do so over the past decades gravely imperils the United States, he contends.

The book thus offers two very different views of how to exercise American power abroad: spread democracies or stand with friendly strongmen...[P]erhaps it mirrors the confusion in the Republican establishment over the direction of conservative foreign policy.

Some of Flynn’s evidence for the alliance diverts into the conspiratorial—I’ve seen nothing credible to back up his assertion that the Iranians were behind the 1979 takeover of the Grand Mosque in Mecca by Sunni apocalypticists. And there’s an important difference between the territorially-bounded ambitions of Iran, Russia, and North Korea, on the one hand, and ISIS’s desire to conquer the world on the other; the former makes alliances of convenience easier than the latter. Still, Flynn would basically be a neocon if he stuck with his core argument: tyrannies of all stripes are arrayed against the United States so the United States should destroy them.

But some tyrannies are less worthy of destruction than others. In fact, Flynn argues there’s a category of despot that should be excluded from his principle, the “friendly tyrants” like President Abdel-Fatah el-Sissi in Egypt and former president Zine Ben Ali in Tunisia. Saddam Hussein should not have been toppled, Flynn argues, and even Russia could become an “ideal partner for fighting Radical Islam” if only it would come to its senses about the threat of “Radical Islam.” Taken alone, these arguments would make Flynn realist, not a neocon. 

The book thus offers two very different views of how to exercise American power abroad: spread democracies or stand with friendly strongmen. Neither is a sure path to security. Spreading democracy through the wrong means can bring to power regimes that are even more hostile and authoritarian; standing with strongmen risks the same. Absent some principle higher than just democracy or security for their own sakes, the reader is unable to decide between Flynn’s contradictory perspectives and judge when their benefits are worth the risks. 

It’s strange to find a book about strategy so at odds with itself. Perhaps the dissonance is due to the co-authors’ divergent views (Ledeen is a neocon and Flynn is comfortable dining with Putin.) Or perhaps it mirrors the confusion in the Republican establishment over the direction of conservative foreign policy. Whatever the case, the muddled argument offered in The Field of Fight demonstrates how hard it is to overcome ideological differences to ally against a common foe, regardless of whether that alliance is one of convenience or conviction. 

2015 is a pivotal year. Three major workstreams among all the world’s nations are going forward this year under the auspices of the United Nations to develop goals, financing, and frameworks for the “post-2015 sustainable development agenda.” First, after two years of wide-ranging consultation, the U.N. General Assembly in New York in September will endorse a new set of global goals for 2030 to follow on from the Millennium Development Goals (MDGs) that culminate this year. Second, to support this effort, a financing for development (FFD) conference took place in July in Addis Ababa, Ethiopia, to identify innovative ways of mobilizing private and public resources for the massive investments necessary to achieve the new goals. And third, in Paris in December the final negotiating session will complete work on a global climate change framework. 

These three landmark summits will, with luck, provide the broad strategic vision, the specific goals, and the financing modalities for addressing the full range of systemic threats. Most of all, these three summit meetings will mobilize the relevant stakeholders and actors crucial for implementing the post-2015 agenda—governments, international organizations, business, finance, civil society, and parliaments—into a concerted effort to achieve transformational outcomes. Achieving systemic sustainability is a comprehensive, inclusive effort requiring all actors and all countries to be engaged.

These three processes represent a potential historic turning point from “business-as-usual” practices and trends and to making the systemic transformations that are required to avoid transgressing planetary boundaries and critical tipping points. Missing from the global discourse so far is a realistic assessment of the political decisions and institutional innovations that would be required to implement the post-2015 sustainable development agenda (P2015).

For 2015, it is necessary is to make sure that by the end of year the three workstreams have been welded together as a singular vision for global systemic transformation involving all countries, all domestic actors, and all international institutions. The worst outcome would be that the new Sustainable Development Goals (SDGs) for 2030 are seen as simply an extension of the 2015 MDGs—as only development goals exclusively involving developing countries. This outcome would abort the broader purposes of the P2015 agenda to achieve systemic sustainability and to involve all nations and reduce it to a development agenda for the developing world that by itself would be insufficient to make the transformations required.

Systemic risks of financial instability, insufficient job-creating economic growth, increasing inequality, inadequate access to education, health, water and sanitation, and electricity, “breaking points” in planetary limits, and the stubborn prevalence of poverty along with widespread loss of confidence of people in leaders and institutions now require urgent attention and together signal the need for systemic transformation.

As a result, several significant structural changes in institution arrangements and governance are needed as prerequisites for systemic transformation. These entail (i) political decisions by country leaders and parliaments to ensure societal engagement, (ii) institutional innovations in national government processes to coordinate implementation, (iii) strengthening the existing global system of international institutions to include all actors, (iv) the creation of an international monitoring mechanism to oversee systemic sustainability trajectories, and (v) realize the benefits that would accrue to the entire P2015 agenda by the engagement of the systemically important countries through fuller utilization of  G20 leaders summits and finance ministers meetings as enhanced global steering mechanisms toward sustainable development.   Each of these changes builds on and depends on each other.

I. Each nation makes a domestic commitment to a new trajectory toward 2030

For global goal-setting to be implemented, it is essential that each nation go beyond a formal agreement at the international level to then embark on a national process of deliberation, debate, and decision-making that adapts the global goals to the domestic institutional and cultural context and commits the nation to them as a long-term trajectory around which to organize its own systemic transformation efforts. Such a process would be an explicitly political process involving national leaders, parliaments or rule-making bodies, societal leaders, business executives, and experts to increase public awareness and to guide the public conversation toward an intrinsically national decision which prioritizes the global goals in ways which fit domestic concerns and circumstances. This political process would avoid the “one-size-fits-all” approach and internalize and legitimate each national sustainability trajectory.

So far, despite widespread consultation on the SDGs, very little attention has been focused on the follow-up to a formal international agreement on them at the U.N. General Assembly in September 2015. The first step in implementation of the SDGs and the P2015 agenda more broadly is to generate a national commitment to them through a process in which relevant domestic actors modify, adapt, and adopt a national trajectory the embodies the hopes, concerns and priorities of the people of each country. Without this step, it is unlikely that national systemic sustainability trajectories will diverge significantly enough from business-as-usual trends to make a difference. More attention needs to now be given to this crucial first step.  And explicit mention of the need for it should appear in the UNGA decisions in New York in September.

II. A national government institutional innovation for systemic transformation

The key feature of systemic risks is that each risk generates spillover effects that go beyond the confines of the risk itself into other domains. This means that to manage any systemic risk requires broad, inter-disciplinary, multi-sectoral approaches. Most governments have ministries or departments that manage specific sectoral programs in agriculture, industry, energy, health, education, environment, and the like when most challenges now are inter-sectoral and hence inter-ministerial. Furthermore, spillover linkages create opportunities in which integrated approaches to problems can capture intrinsic synergies that generate higher-yield outcomes if sectoral strategies are simultaneous and coordinated.

The consequence of spillovers and synergies for national governments is that “whole-of-government” coordinating committees are a necessary institutional innovation to manage effective strategies for systemic transformation. South Korea has used inter-ministerial cabinet level committees that include private business and financial executives as a means of addressing significant interconnected issues or problems requiring multi-sectoral approaches. The Korea Presidential Committee on Green Growth, which contained more than 20 ministers and agency heads with at least as many private sector leaders, proved to be an extremely effective means of implementing South Korea’s commitment to green growth.

III.  A single global system of international institutions

The need for a single mechanism for coordinating the global system of international institutions to implement the P2015 agenda of systemic transformation is clear. However, there are a number of other larger reasons why the forging of such a mechanism is crucial now.

The Brettons Woods era is over. It was over even before the initiative by China to establish the Asia Infrastructure Investment Bank (AIIB) in Beijing and the New Development Bank (NDB) in Shanghai. It was over because of the proliferation in recent years of private and official agencies and actors in development cooperation and because of the massive growth in capital flows that not only dwarf official development assistance (concessional foreign aid) but also IMF resources in the global financial system. New donors are not just governments but charities, foundations, NGOs, celebrities, and wealthy individuals. New private sources of financing have mushroomed with new forms of sourcing and new technologies. The dominance of the IMF and the World Bank has declined because of these massive changes in the context.

The emergence of China and other emerging market economies requires acknowledgement as a fact of life, not as a marginal change. China in particular deserves to be received into the world community as a constructive participant and have its institutions be part of the global system of international institutions, not apart from it. Indeed, China’s Premier, Li Keqiang, stated at the World Economic Forum in early 2015 that “the world order established after World War II must be maintained, not overturned.”

The economic, social and environmental imperatives of this moment are that the world’s people and the P2015 agenda require that all international institutions of consequence be part of a single coordinated effort over the next 15 years to implement the post-2015 agenda for sustainable development. The geopolitical imperatives of this moment also require that China and China’s new institutions be thoroughly involved as full participants and leaders in the post-2015 era. If nothing else, the scale of global investment and effort to build and rebuild infrastructure requires it.

It is also the case that the post-2015 era will require major replenishments in the World Bank and existing regional development banks, and significantly stronger coordination among them to address global infrastructure investment needs in which the AIIB and the NDB must now be fully involved. The American public and the U.S. Congress need to fully grasp the crucial importance for the United States, of the IMF quota increase and governance reform.  These have been agreed to by most governments but their implementation is stalled in the U.S. Congress. To preserve the IMF’s role in the global financial system and the role of the U.S. in the international community, the IMF quota increase and IMF governance reform must be passed and put into practice. Congressional action becomes all the more necessary as the effort is made to reshape the global system of international institutions to accommodate new powers and new institutions within a single system rather than stumble into a fragmented, fractured, and fractious global order where differences prevail over common interests.

The IMF cannot carry out its significant responsibility for global financial stability without more resources. Other countries cannot add to IMF resources proportionately without U.S. participation in the IMF quota increase.   Without the US contribution, IMF members will have to fund the IMF outside the regular IMF quota system, which means de-facto going around the United States and reducing dramatically the influence of the U.S. in the leadership of the IMF. This is a self-inflicted wound on the U.S., which will damage U.S. credibility, weaken the IMF, and increase the risk of global financial instability. By blocking the IMF governance reforms in the IMF agreed to by the G-20 in 2010, the U.S. is single-handedly blocking the implementation of the enlargement of voting shares commensurate with increased emerging market economic weights.  This failure to act is now widely acknowledged by American thought leaders to be encouraging divergence rather than convergence in the global system of institutions, damaging U.S. interests.

IV. Toward a single monitoring mechanism for the global system of international institutions

The P2015 agenda requires a big push toward institutionalizing a single mechanism for the coordination of the global system of international institutions.  The international coordination arrangement today, is the Global Partnership for Effective Development Cooperation created at the Busan High-Level Forum on Aid Effectiveness in 2011.  This arrangement, which recognizes the increasingly complex context and the heightened tensions between emerging donor countries and traditional western donors, created a loose network of country platforms, regional arrangements, building blocks and forums to pluralize the architecture to reflect the increasingly complex set of agents and actors. This was an artfully arranged compromise, responding to the contemporary force field four years ago.

Now is a different moment. The issues facing the world are both systemic and urgent; they are not confined to the development of developing countries, and still less to foreign aid. Geopolitical tensions are, if anything, higher now than then.  But they also create greater incentives to find areas of cooperation and consensus among major powers who have fundamentally different perspectives on other issues. Maximizing the sweet spots where agreement and common interest can prevail is now of geopolitical importance.  Gaining agreement on institutional innovations to guide the global system of international institutions in the P2015 era would be vital for effective outcomes but also importantly ease geopolitical tensions.

Measurement matters; monitoring and evaluation is a strategic necessity to implementing any agenda, and still more so, an agenda for systemic transformation.  As a result, the monitoring and evaluation system that accompanies the P2015 SDGs will be crucial to guiding the implementation of them.  The UN, the OECD, the World Bank, and the IMF all have participated in joint data gathering efforts under the IDGs  in the 1990s and the MDGs in the 2000s.   Each of these institutions has a crucial role to play, but they need to be brought together now under one umbrella to orchestrate their contributions to a comprehensive global data system and to help the G20 finance ministers coordinate their functional programs.   

The OECD has established a strong reputation in recent years for standard setting in a variety of dimensions of the global agenda.  Given the strong role of the OECD in relation to the G20 and its broad outreach to “Key Partners” among the emerging market economies, the OECD could be expected to take a strong role in global benchmarking and monitoring and evaluation of the P2015 Agenda.  The accession of China to the OECD Development Centre, which now has over fifty member countries, and the presence and public speech of Chinese Premier Li Keqiang at the OECD on July 1^st, bolsters the outreach of the OECD and its global profile.

But national reporting is the centerpiece and the critical dimension of monitoring and evaluation.  To guide the national reporting systems and evaluate their results, a  new institutional arrangement is needed that is based on national leaders with responsibility for implementation of the sustainable development agendas from each country and is undertaken within the parameters of the global SDGs and the P2015 benchmarks.

V.   Strengthening global governance and G20 roles

G-20 leaders could make a significant contribution to providing the impetus toward advancing systemic sustainability by creating a G-20 Global Sustainable Development Council charged with pulling together the national statistical indicators and implementing benchmarks on the SDGs in G-20 countries.  The G-20 Global Sustainable Development Council (G-20 GSDC) would consist of the heads of the presidential committees on sustainable development charged with coordinating P2015 implementation in G-20 countries.  Representing systemically important countries, they would also be charged with assessing the degree to which national policies and domestic efforts by G20 countries generate positive or negative spillover effects for the rest of the world.  This G-20 GSDC would also contribute to the setting of standards for the global monitoring effort, orchestrated perhaps by the OECD, drawing on national data bases from all countries using the capacities of the international institutions to generate understanding of global progress toward systemic sustainability. 

The UN is not in a position to coordinate the global system of international institutions in their functional roles in global sustainable development efforts.  The G-20 itself could take steps through the meetings of G-20 Finance Ministers to guide the global system of international institutions in the implementation phase of the P2015 agenda to begin in 2016. The G-20 already has a track record in coordinating international institutions in the response to the global financial crisis in 2008 and its aftermath. The G-20 created the Financial Stability Board (FSB), enlarged the resources for the IMF, agreed to reform the IMF’s governance structure, orchestrated relations between the IMF and the FSB, brought the OECD into the mainstream of G-20 responsibilities and has bridged relations with the United Nations by bringing in finance ministers to the financing for development conference in Addis under Turkey’s G-20 leadership. 

There is a clear need to coordinate the financing efforts of the IMF, with the World Bank and the other regional multilateral development banks (RMDBs), with the AIIB and the BRICS NDB, and with other public and private sector funding sources, and to assess the global institutional effort as whole in relation to the P2015 SDG trajectories.  The G-20 Finance Ministers grouping would seem to be uniquely positioned to be an effective and credible means of coordinating these otherwise disparate institutional efforts.  The ECOSOC Development Cooperation Forum and the Busuan Global Partnership provide open inclusive space for knowledge sharing and consultation but need to be supplemented by smaller bodies capable of making decisions and providing strategic direction.

Following the agreements reached in the three U.N. workstreams for 2015, the China G-20 could urge the creation of a formal institutionalized global monitoring and coordinating mechanism at the China G-20 Summit in September 2016. By having the G-20 create a G-20 Global Sustainable Development Council (G-20 GSDC), it could build on the national commitments to SDG trajectories to be made next year by U.N. members countries and on the newly formed national coordinating committees established by governments to implement the P2015 Agenda, giving the G-20 GSDC functional effectiveness, clout and credibility.   Whereas there is a clear need to compensate for the sized-biased representation of the G20 with still more intensive G-20 outreach and inclusion, including perhaps eventually considering shifting to a constituency based membership, for now the need in this pivotal year is to use the momentum to make political decisions and institutional innovations which will crystallize the P2015 strategic vision toward systemic sustainability into mechanisms and means of implementation.

By moving forward on these recommendations, the G-20 Leaders Summits would be strengthened by involving G-20 leaders in the people-centered P2015 Agenda, going beyond finance to issues closer to peoples’ homes and hearts. Systemically important countries would be seen as leading on systemically important issues.  The G-20 Finance Ministers would be seen as playing an appropriate role by serving as the mobilizing and coordinating mechanism for the global system of international institutions for the P2015 Agenda.  And the G-20 GSDC would become the effective focal point for assessing systemic sustainability not only within G20 countries but also in terms of their positive and negative spillover effects on systemic sustainability paths of other countries, contributing to standard setting and benchmarking for global monitoring and evaluation.    These global governance innovations could re-energize the G20 and provide the international community with the leadership, the coordination and the monitoring capabilities that it needs to implement the P2015 Agenda. 

As the MDGs culminate this year, as the three U.N. workstreams on SDGs, FFD, and UNFCC are completed, the world needs to think ahead to the implementation phase of the P2015 sustainable development agenda. Given the scale and scope of the P2015 agenda, these five governance innovations need to be focused on now so they can be put in place in 2016.

These will ensure (i) that national political commitments and engagement by all countries are made by designing, adopting, and implementing their own sustainable development trajectories and action plans; (ii) that national presidential committees are established, composed of key ministers and private sector leaders to coordinate each country’s comprehensive integrated sustainability strategy; (iii) that all governments and international institutions are accepted by and participate in a single global system of international institutions;   (iv) that a G-20 monitoring mechanism be created by the China G-20 in September 2016 that is comprised of the super-minister officials heading the national presidential coordinating committees implementing the P2015 agenda domestically in G-20 countries, as a first step;  and (v) that the G-20 Summit leaders in Antalya in November 2015 and in China in September 2016 make clear their own commitment to the P2015 agenda and their responsibility for its adaption, adoption and implementation internally in their countries but also for assessing G-20 spillover impacts on the rest of the world, as well as for deploying their G-20 finance ministers to mobilize and coordinate the global system of international institutions toward achieving the P2015 agenda.

Without these five structural changes, it will be more likely that most countries and actors will follow current trends rather than ratchet up to the transformational trajectories necessary to achieve systemic sustainability nationally and globally by 2030.

Ye Yu, Xue Lei and Zha Xiaogag, “The Role of Developing Countries in Global Economic Governance---With a Special Analysis on China’s Role”, UNDP, Second High-level Policy Forum on Global Governance: Scoping Papers, (Beijing: UNDP, October 2014).

Zhang Haibing, “A Critique of the G-20’s Role in UN’s post-2015 Development Agenda”, in Catrina Schlager and Chen Dongxiao (eds), China and the G-20: The Interplay between an Emerging Power and an Emerging Institution, (Shanghai: Shanghai Institutes for International Studies [SIIS] and the Friedrich Ebert Stiftung [FES], 2015) 290-208.

Global Review, (Shanghai:  SIIS, 2015,) 97-105.

Colin I. Bradford, “Global Economic Governance and the Role International Institutions”, UNDP, Second High-level Policy Forum on Global Governance: Scoping Papers, (Beijing: UNDP, October 2014).

Colin I. Bradford, “Action implications of focusing now on implementation of the   post-2015 agenda.”, (Washington: The Brookings Institution, Global Economy and Development paper, September 2015).

Colin I. Bradford, “Systemic Sustainability as the Strategic Imperative for the Future”, (Washington: The Bookings Institution, Global Economy and Development paper; September 2015). 

Wonhyuk Lim and Richard Carey, “Connecting Up Platforms and Processes for Global Development to 2015 and Beyond:  What can the G-20 do to improve coordination and deliver development impact?”, (Paris: OECD  Paper, February 2013).

Xiaoyun Li and Richard Carey, “The BRICS and the International Development System: Challenge and Convergence”, (Sussex: Institute for Development Studies, Evidence Report No. 58, March 2014).

Xu Jiajun and Richard Carey, “China’s Development Finance: Ambition, Impact and Transparency,” (Sussex :  Institute for Development Studies, IDS Policy Brief, 2015).

Soogil Young, “Domestic Actions for Implementing Integrated Comprehensive Strategies:  Lessons from Korea’s Experience with Its Green Growth Strategy”, Washington: Paper for the Brookings conference on “Governance Innovations to Implement the Post-2015 Agenda for Sustainable Development”, March 30, 2015).

“A society of equals is a society in which disadvantages do not cluster,” say Jonathan Wolff and Avner de-Shalit in their book Disadvantage. Low income matters greatly in itself, of course. But it also matters because it brings other difficulties along with it, like poor health and/or a lack of health insurance. An important goal of policy is to “de-cluster” these disadvantages.  

In recent years, the State of Colorado, embracing and going beyond the Affordable Care Act, has increased health insurance coverage, especially among low-income residents. Between 2009 and 2015, the proportion of Coloradans with annual family incomes below $30,000 who were uninsured fell from one in four to one in ten.

Clearly this is good news. But the expansion of insurance has so far had a modest impact on healthcare utilization, at least according to the Colorado Health Access Survey. The Survey includes questions such as, “Have you visited a health care professional or health care facility in the past 12 months?,” and “Was there any time that you did not get doctor care that you needed because of cost?” On these and similar questions, there was relatively little change between 2009 and 2015.

Why didn’t improved health insurance coverage lead to increased use of health care resources? It may be that the survey questions simply aren’t capturing improvements in utilization rates. A more detailed study of the ACA expansion in Oregon did find an increase in utilization, along with improvements on a number of financial hardship indicators. The Colorado survey does seem to suggest financial improvement: the share of low-income white residents that reported trouble paying medical bills fell by just over 3 percentage points from 2009 to 2015; for minority residents the figure was just over 6 percentage points. It’s hard to know, however, how much of this trend is driven by the stronger economy, and how much is driven by the ACA expansion. It is also possible that people are now able to access more appropriate care, for instance using primary care, rather than resorting to the emergency room.

Utilization rates have clearly increased in one area, however: dental health. Medicaid covers dental care for children, so Colorado’s Medicaid expansion increased the number of children in the state with government-sponsored dental insurance. In 2014, Colorado also became one of the few states to introduce limited adult dental coverage. As a result of these policy reforms, the share of low-income Coloradans with insurance for dental care has increased sharply:

Over the same time period, the proportion of low-income Coloradans who visited a dentist—especially minorities—increased, too:

Dentistry is an important part of the health care system, and dental disease is a serious health issue. Four in ten poor Americans suffer from untreated tooth decay, according to some researchers. Better dental care helps low-income people in a range of ways, from avoiding emergency rooms, to having healthier pregnancies, and even succeeding in the job market. The dramatic improvements in dental coverage and dental care in Colorado show that the connection between policy reforms and improved quality of life can sometimes be quite straightforward. 

Event Information

The White House Council of Economic Advisers (CEA) was created by Congress in 1946 to advise the president on ways “to foster and promote free competitive enterprise” and “to promote maximum employment, production and purchasing power.” President Truman, who signed the Employment Act of 1946 into law, was unenthusiastic about the Council and didn’t nominate members for nearly six months. Yet the CEA, comprised of three individuals whom Congress says are to be “exceptionally qualified,” has not only survived but also prospered for 70 years and remains an important part of the president’s economic policy decisionmaking.

On February 11, the Hutchins Center on Fiscal and Monetary Policy at Brookings marked this anniversary by examining the ways the CEA and other economists succeed and fail when they set out to advise elected politicians and tap the expertise of some of the “exceptionally qualified” economists who have chaired the Council over the past four decades.

You can join the conversation and tweet questions for the panelists at #CEAat70.

Video

• Panel 1: The CEA in Moments of Crisis
• Panel 2: The CEA and Policymaking
• Panel 3: Current Economic Policy Issues

Audio

• The Council of Economic Advisers: 70 years of advising the president

Transcript

• Uncorrected Transcript (.pdf)

Event Materials

• 20160211_economic_advisers_transcript