By Lawrence Summers With the accumulation of scientific evidence and its persuasive presentation to the public, the global warming debate has reached a new stage. Those who still deny that human activity is warming the planet, or claim that “business as usual” can continue indefinitely without profoundly adverse consequences, are increasingly seen as the moral and intellectual equivalent of those who deny that tobacco has adverse consequences for human health. While there is probably excessive euphoria in some quarters over the economic benefit of green policies, it is now beyond debate that there are huge opportunities to reduce emissions with economic benefit or negligible economic cost. It has been estimated that worldwide subsidies to energy use approach $250bn. (more…)

“A man has died thanks to whom a whole new era began. A new democratic Russia was born: a free state open to the world in which power really does belong to the people.” Thus did Vladimir Putin laud Boris Yeltsin, the man who chose him for the presidency of his country. Mr Putin was both right and wrong. Yeltsin was the most democratic ruler Russia has ever possessed. Yet what is emerging under his successor is not the vibrant democracy that many hoped for. Yeltsin’s legacy is as mixed as was his turbulent nature. Yeltsin was among a small number of leaders who have transformed the world. His name will ever be linked to that of Mikhail Gorbachev, the last general secretary of the Communist party of the Soviet Union, an organisation that played so catastrophic a part in the history of the 20th century. Yeltsin’s courage and charisma brought to an end both the party and the Soviet Union itself. His enemies will never forgive him for his role in ending the party, the state and the Russian empire in 1991. But those who lived most of their lives in the shadow of the cold war will always be grateful to him. The sight of him standing heroically against the attempted coup of August 1991 is unforgettable. It was the end of a ghastly era of human history, in which despotism went almost beyond the limits of the imagination. The remainder of Martin Wolf’s column can be read here (FT.com subscribers only). Discussion from our guest economists is free.

“If you want to make poverty history you have to make corruption history.” Paul Wolfowitz, embattled president of the World Bank, cited this remark by Nuhu Ribadu, head of the Economic Crimes and Corruption Commission of Nigeria, in a speech made only last month. There he emphasised, once again, the guiding theme of his presidency: fighting corruption and improving governance. How credible, after recent revelations, is the World Bank as a beacon of good governance and a scourge of corruption? “Much less than it should be” is the answer. In a speech just over a year ago in Jakarta, Mr Wolfowitz defined governance as “the combination of transparent and accountable institutions, strong skills and competence, and a fundamental willingness to do the right thing”. Corruption is narrower: it is the abuse of public provision for private gain. Corruption, as Jim Wolfensohn, Mr Wolfowitz’s predecessor, said, is “a cancer on the development process”. Yet corruption is also the natural thing to do. The remainder of Martin Wolf’s column can be read here (FT.com subscribers only). Discussion from our guest economists is free.

There are two particularly significant facts about labour markets of the high-income countries over the past two to three decades: globalisation and declining shares of labour income in gross domestic product. How are these phenomena related? What are the policy implications? The answers to these questions may well determine whether the backlash against globalisation – visible today in the politics of the US and France, two proud republics more similar to each other than they would wish to admit – becomes overwhelming. The subject is the focus of a background chapter to the latest World Economic Outlook from the International Monetary Fund.* It reaches four chief conclusions: The remainder of Martin Wolf’s column can be read here (FT.com subscribers only). Discussion from our guest economists is free.

“I will never falter in my belief that enduring peace and the welfare of nations are indissolubly connected with friendliness, fairness, equality, and the maximum practicable degree of freedom in international trade.” Cordell Hull, US secretary of state 1933-44.

This month marks the 60th anniversary of the General Agreement on Tariffs and Trade, of which Cordell Hull was a founding father. It also sees the announcement of a “free trade agreement” between his country and South Korea. The core of the Gatt was non-discrimination. The core of the new agreement is its opposite. Thus has the US taken the betrayal of its erstwhile principles even closer to its logical conclusion.

At a first glance, the new FTA does deliver a substantial opening between the world’s largest economy and its 11th largest: nearly 95 per cent of bilateral trade in consumer and industrial products is to become duty free within three years, with most remaining tariffs abolished within 10; South Korea is to liberalise access for many US farm exports, though not rice; US investors are to receive greater protection; access for the US service sector will be liberalised, including for legal, accounting and audiovisual services; intellectual property is to receive greater protection; government procurement is to be substantially opened up; new commitments are made on customs administration and rules of origin; and, not least, a new dispute settlements body is to be established.

Why do I object? Is such trade liberalisation not precisely what most economists interested in trade believe in?

The remainder of Martin Wolf’s column can be read here (FT.com subscribers only). Discussion from our guest economists is free.