Acton Institute Powerblog

Angus Deaton schools Italians on economics

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But was anyone listening?

That’s my question after attending the 2015 Nobel-prize-winning economist‘s talk last night in Rome at the Vatican-sponsored Cortile dei gentili (Court of Gentiles).

Like the other speakers, Deaton voiced his concerns about income inequality. Unlike the others, however, he said much of it is caused by crony capitalism, a term whose meaning seems to have been lost on the Italian interpreter and hence the audience. She described it as “a type of capitalism” and “negative capitalism” but never really made the connection to politics, which is unfortunate given the high number of Italian politicians in attendance.

Deaton added that countries become rich by escaping poverty, not by impoverishing others, that technological progress has undoubtedly made us richer, and that the world has greatly benefited from globalization even though too many people are still left behind. Government interference through taxes, regulation and corruption does more harm than good. The major problems with globalization are therefore political, not economic.

There were also a number of Italian cardinals and bishops in attendance. Here’s hoping that some of them relay Deaton’s clear-as-day message to Pope Francis, who really ought to be saying, “Crony capitalism kills!” instead of blaming the market economy in general. It is an obvious distinction to economists. In Italy, no one seems to know the difference.

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Kishore Jayabalan Kishore Jayabalan is director of Istituto Acton, the Acton Institute's Rome office. Formerly, he worked for the Vatican's Pontifical Council for Justice and Peace as the lead policy analyst on sustainable development and arms control. Kishore Jayabalan earned a B.A. in political science and economics from the University of Michigan, Ann Arbor. In college, he was executive editor of The Michigan Review and an economic policy intern for the U.S. Chamber of Commerce. He worked as an international economist for the Bureau of Labor Statistics in Washington, D.C. and then graduated with an M.A. in political science from the University of Toronto. While in Toronto, Kishore interned in the university's Newman Centre, which led to his appointment to the Permanent Observer Mission of the Holy See to the United Nations in New York. Two years later, he returned to Rome to work for the Pontifical Council for Justice and Peace as the Holy See's lead policy analyst on sustainable development and arms control. As director of Istituto Acton, Kishore organizes the institute's educational and outreach efforts in Rome and throughout Europe.

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