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February 28, 2008
Quote of the Day for Thursday, February 28, 2008
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February 27, 2008
Political Punditry and the "Great and Powerful Oz"
Lee Gomes, writing in the Wall Street Journal, identifies yet another reason why the mainstream media gets red-faced and insecure when the subject of bloggers and online news comes up:
Like most writers online, Rick Klein, who covers politics on the ABC News Web site, invites reader comment. The posts he gets tend toward predictable red vs. blue harangues. But one commenter, "Henry," stood out for his unusually insightful analyses of campaign strategies, exit polls and other election esoterica.
Curious about Henry's identity, Mr. Klein wrote him and asked: Are you a midlevel staffer at some big presidential campaign? Or perhaps a K Street lobbyist, whose livelihood will be affected by November?
Henry turned out to be a high-school teacher in California, whose only connection to the Beltway was a broadband one. . . .
When knowledge gets democratized and distributed ubiquitously, it arouses the wrath of the "great and powerful" punditry:
Quote of the Day for Wednesday, February 27, 2008
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February 26, 2008
Quote of the Day for Tuesday, February 26, 2008
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February 25, 2008
Georgia's "China Decade"
Tomorrow, the Georgia-China Alliance celebrates the fourth "China Day" at the State Capitol. In a relatively short period of time, Georgia's ties with China have multiplied rapidly, as I expressed in an editorial in this week's issue of the Atlanta Business Chronicle:
This week, thanks to a joint resolution sponsored by Sen. Judson Hill and Rep. Charlice Byrd, we will be celebrating “China Day” at the State Capitol. Georgia’s relationship with China has come a long way very quickly.
About four years ago, a State Senate Committee led by Sen. Sam Zamarripa conducted research on Georgia’s relationship with China to determine how our ties could be enhanced. Since this study (pdf) was done, Georgia’s Chinese connections have flourished, thanks to the efforts of both private and public sector individuals too numerous to name. While celebrating “China Day” again this year, we Georgians are really in the midst of celebrating “The China Decade”.
In 2001, China trailed the Netherlands and Brazil as Georgia’s eighth largest trading partner. According to the latest available data, Georgia’s exports to China have mushroomed to $1.1 billion, a 23% compound annual growth. China is now Georgia’s third largest export market, ahead of the United Kingdom, Japan, or Germany.
Georgia is a Southeastern leader in attracting Chinese business; we have several different Chinese companies in various stages of constructing facilities here. Imports from China are the principal reason Savannah is America’s fastest growing port.
Despite this progress, our relationship with China still has remarkable unrealized potential. We must press our federal officials to clear the way for China to locate its next U.S. consulate in Atlanta. As has been the case with Houston, a Chinese consulate in Georgia would plant our state in the sights of many more Chinese businesses contemplating a U.S. location than would otherwise be the case.
With disposable income in China rising quickly, our state should commit funds which promote Georgia to Chinese tourists looking at potential U.S. destinations. Those tourists can’t get here, however, without visas granted by the U.S. government. Consequently, we must press our Washington representatives to overhaul and streamline the visa approval process for both tourists and businesspeople.
While the growth in our state’s relationship with China has been dramatic and profitable, we have much more work ahead of us to fully realize the potential of our “China Decade”.
My friend Kathe Falls, Director of International Trade at the Georgia Department of Economic Development, was nice enough to get me the 2007 trade statistics, which she has faster access to than I do. Trade statistics for 2007 reveal that China is now in second place on Georgia's list of export markets, behind only Canada. Exports to China from Georgia grew by 26% in 2007. That's really big news, and further indication of the rapidly growing Georgia-China relationship.
Posted by John at 10:20 AM | Comments (0) | TrackBackMobile Capital Pressures Corporate Tax Rates
Taiwan plans a cut in its corporate tax rate, from 25% to 17.5%, while Iceland has reduced its tax on business to 15%, down from 18%. John Rutledge explains that these changes in tax policy have nothing to do with ideology; they are a response to a world in which capital is extremely mobile:
Posted by John at 5:39 AM | Comments (0) | TrackBackThese governments are not driven by ideology--free market or otherwise. They are reducing tax rates on productive capital because they have decided that they must do so to actively compete for the capital that will drive higher productivity and paychecks for their workers. Like it or not, capital owners today can move their capital wherever in the world it will earn the best risk-adjusted return. It costs little to do so. And it is virtually undetectable by anyone when they do it. This makes it much more difficult to craft a tax policy that achieves distributional, or fairness, goals and raises the stakes, in terms of lost jobs and paychecks, when policy makers inadvertently drive capital offshore.
Quote of the Day for Monday, February 25, 2008
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February 24, 2008
Quote of the Day for Sunday, February 24, 2008
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February 23, 2008
One Shameful Result of Our Tariff System
Last year Cambodia, a country with a per capita income of less than $36 a month, paid about $419 million in tariff penalties on goods imported to the U.S. Cambodia paid more in tariffs than Great Britain, which paid $412 million.
Cambodia's tariffs to the U.S. amount to $30 annually for every man, woman, and child in the country. That's shameful.
More related information at PPI.
Posted by John at 8:01 AM | Comments (0) | TrackBackQuote of the Day for Saturday, February 23, 2008
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February 22, 2008
Quote of the Day for Friday, February 22, 2008
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February 21, 2008
Quote of the Day for Thursday, February 21, 2008
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February 20, 2008
Castro Goes, But Cuba's Weak Demographic Future Remains
Fidel Castro is out of power--nominally, anyway--and Cuba is in leadership transition. Whoever leads the country over the next few years, regardless of their political philosophy or executive abilities, will have to confront a very poor demographic outlook. In case you missed it, we pointed to an extraordinarily interesting study of Cuba's demographic future, an outlook which which will challenge the most able leadership, much less a collection of cronies.
Posted by John at 6:25 AM | Comments (0) | TrackBackQuote of the Day for Wednesday, February 20, 2008
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February 19, 2008
Quote of the Day for Tuesday, February 19, 2008
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February 18, 2008
Quote of the Day for Monday, February 18, 2008
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February 17, 2008
Sovererign Wealth Funds and "America the Cheap"
A combination of absolute asset values down and a weak dollar have made investment opportunities in America attractive to sovereign wealth funds. Thomas P.M. Barnett argues we should welcome this development, certainly as compared to the alternatives:
. . . There's no question that sovereign wealth funds (SWFs) do this now to protect themselves down the road (no one wants a U.S. recession) and to take advantage. But the larger function is very real too: this is how a rich country gets bailed out of a financial crisis. Bitch about it all you want, but tell me the alternative that beats it.
I know, I know. We need to spend less and save more. Stipulated. But how do you want the pain of that lesson transmitted?
As for getting scared of these funds, the fear remains misplaced. The same money could be used for military buildups and all sorts of scary or stupid stuff. Instead, it's being re-invested in America. Again, paint me the better alternative. . . .
As for their big size, SWFs remain about 2% of the world's $165 trillion world of securities, and they're collectively tiny compared to the combined weight of the three heavies (insurance companies, mutual funds and pension funds). . . .
For now, the bulk of the SWFs emanate from oil-rich countries . . . but that just means those countries are financially diversifying, which makes a lot of sense. What oil country should keep all its wealth in oil? That's like having your entire pension with Enron.
Clearly, this evolution bears watching, but suspicions about SWFs being run for national reasons over financial ones will make their impact self-limiting—as in, that's a recipe for financial failure.
The Economist hits the nail on the head when it says, the real danger of SWFs right now is that they may trigger stupid protectionism instead of acceptance as yet another balancing mechanism in our increasingly globalized economy—something it's doing right now quite nicely.
The Economist article Barnett cites, quite extensive and worth your perusal, make similar points:
Posted by John at 9:37 AM | Comments (0) | TrackBackA broad, politicised hostility to foreign direct investment would come at a high cost. Such investment spreads financial capital, know-how and technology. It helps the world economy adjust to imbalances and gives countries stakes in each other's prosperity. By contrast, as the dispute over DP World showed, conflicts over one investment can rapidly become generalised to others—either directly or through bodies like the Committee on Foreign Investment in the United States, which weighs up the implications of takeovers on national security. That spreads uncertainty, which could even spill over into the trade of goods and services. The European Union, for instance, now wants such a committee of its own.
Even now, suspicion of sovereign-wealth funds comes at a price. The investments in Wall Street have helped to stabilise the banking system, making this an ideal moment for active shareholders to be crawling all over the banks, asking what went wrong in the credit crunch and how to prevent the next. Instead, the banks have taken on large, friendly, long-term shareholders who cannot easily kick up a fuss. If the new investors were to become disgruntled, they may find it costly to sell in a hurry. And most of the funds know that if they cause trouble, people in Washington will soon get to hear about it.
Quote of the Day for Sunday, February 17, 2008
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February 16, 2008
Belief in Capitalism is Really Belief in Human Beings
I recently quoted Johan Norberg's In Defense of Global Capitalism on when capitalists are dangerous. In an accompanying passage, Norberg explains why a belief in capitalism is really a belief in the capability and ingenuity of human beings:
Posted by John at 12:00 PM | Comments (0) | TrackBackWhat I really believe in, first and foremost, isn't capitalism or globalisation. It isn't the systems or regulatory codes that achieve all we see around us in the way of prosperity, innovation, community, and culture. Those things are created by people. What I believe in is man's capacity for achieving great things, and the combined force that results from our interactions and exchanges. I plead for greater liberty and a more open world, not because I believe one system happens to be more efficient than another, but because those things provide a setting that unleashes individual creativity as no other system can. They spur the dynamism that has led to human, economic scientific, and technical advances. Believing in capitalism does not mean believing in growth, the economy, or efficiency,. Desirable as they may be, those are only the results. At its core, belief in capitalism is belief in mankind.
Banking Monkeys See, Banking Monkeys Dance
John Kay notes that human tendencies when acting in groups, behavior as old as the human race, explains today's malaise in the banking industry:
"So long as the music is playing, you’ve got to keep dancing. We’re still dancing." Chuck Prince, former chairman and chief executive of Citigroup, was interviewed by this paper only a month before the music stopped. A few weeks later he was out of a job. With these comments, he got to the heart of the banking crisis. . . .
Mr Prince’s metaphor is sociological and anthropological not economic. Groups routinely demonstrate behaviour that few if any members would choose to adopt as individuals. Look at teenage gangs, soccer hooligans, religious zealots – or clubbers. Sometimes the group provides a cloak of legitimacy for misbehaviour. The trading floor has a similar effect. You get carried away, explained Jérôme Kerviel, Société Générale’s former trader. The process by which hysterical groups damage themselves and others in assertion of preposterous beliefs is a recurrent theme in human history. We see it in anti-Semitic pogroms or McCarthyite persecution. Before the mysteries of structured credit there were the mysteries of witchcraft; before investment banks used initial public offerings to turn dotcom concepts into billions of dollars alchemists claimed to turn base metals into gold. . . .
Read Kay's full commentary here.
Posted by John at 3:23 AM | Comments (0) | TrackBackQuote of the Day for Saturday, February 16, 2008
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February 15, 2008
Budget Busting Bush
President Bill Clinton, in his 1996 State of the Union Address, declared "the era of big government is over". Whether he really believed what he said can be argued, I suppose.
What's hard to argue, however, is that President George W. Bush doesn't agree whatsoever; Veronique de Rugy explains in an editorial published in the L.A. Times:
Posted by John at 7:12 PM | Comments (0) | TrackBackIf President Bush's budget for fiscal 2009 is approved in its current form, U.S. government spending will have increased by more than $1.2 trillion since President Clinton left office; adjusted for inflation, that's a 35% increase. Bush has increased spending at three times the rate Clinton did when he was president, and also has given us the biggest defense budget since World War II -- and that's regularly budgeted defense spending, not counting funding for the wars in Iraq and Afghanistan. [emphasis mine]
McCain the Free Trader
According to an extremely informative interactive website set up by the Cato Institute, John McCain is unequivocal free trader who has consistently opposed trade barriers and subsidies, based on his voting record over his entire career in Congress. Not surprisingly, Hillary Clinton is rated as an interventionist, generally voting in favor of subsidies and trade barriers. Judging by an extremely limited voting record, Barack Obama's record on trade and subsidies isn't much different than that of Clinton.
Posted by John at 6:54 PM | Comments (0) | TrackBackWhen Capitalists are Dangerous
From Johan Norberg's excellent In Defense of Global Capitalism, which I highly recommend:
Posted by John at 6:33 PM | Comments (0) | TrackBack. . . Capitalists are dangerous when, instead of seeking profit through competition, they join forces with the government. If the state is a dictatorship, corporations can easily be parties to human rights violations, as a number of Western oil companies have been in African states. By the same token, capitalist who stalk the corridors of political power in search of benefits and privileges are not true capitalists. On the contrary, they are a threat to the free market and as such must be criticised and counteracted. Often, businessmen want to play politics, and politicians want to play at being businessmen. That is not a market economy; it is a mixed economy in which entrepreneurs and politicians have confused their roles. Free capitalism exists when politicians pursue liberal policies and entrepreneurs do business.
Privatization at a Record Pace
According to the World Bank (pdf), 249 privatization transactions from 48 developing countries occurred in 2006, valued at a record $104.9 billion. Two of these transactions, the IPOs of the Industrial and Commercial Bank of China and Bank of China, account for one-third of the volume.
In nominal terms, this deal volume is a record; in real terms it is 17% less than the peak in 1997.
Posted by John at 6:19 PM | Comments (0) | TrackBackQuote of the Day for Friday, February 15, 2008
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February 14, 2008
Valentine's Day Spending
An estimated $17 billion will be spent in the U.S. on Valentine's Day candy, gifts, cards, and other goods this year, according to the National Retail Federation. This amount is roughly equal to the entire GDP countries such as El Salvador, Tanzania, and Estonia. [Source: PPI]
Posted by John at 3:49 PM | Comments (0) | TrackBackQuote of the Day for Thursday, February 14, 2008
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February 13, 2008
Hispanic Chamber of Commerce Being Formed in Brunswick, Georgia
The Hispanic business community in Brunswick, Georgia appears to be mature enough to justify the creation and support of an Hispanic Chamber of Commerce. Read the complete story here.
Posted by John at 9:55 AM | Comments (0) | TrackBackQuote of the Day for Wednesday, February 13, 2008
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February 12, 2008
China's Tax Structure Explains Incentives for Growth
When you understand China's sources of tax revenue, as explained in this Wall Street Journal article, you understand why the government is so anxious to maintain growth:
Posted by John at 6:03 AM | Comments (0) | TrackBackYears of big gains in the tax take have helped the government increase spending and trim its already small budget deficit, but the increases have come largely from taxes paid by big companies. Last year, a windfall from a transaction levy on China's booming stock market helped boost the tax take by nearly 30%.
Although finances are sound now, the lopsided structure of China's tax system could become a challenge if corporate profits weaken, as the stock market has already begun to do. The new spending commitments President Hu Jintao's administration has been ramping up in recent years will likely require a broader, more stable revenue base. And the ease with which China's new rich can evade taxes has become politically embarrassing for a government that espouses socialist ideals.
Those concerns are behind a push to expand the reach of the income tax, starting with the top earners. The potential payoff is large. Like many developing countries, China gets little money from the personal income tax, which provides 6.5% of government revenue. Most Chinese have never filed a tax return. By contrast, the income tax made up about 45% of the U.S. federal government's total tax take in the fiscal year that ended in September.
Immigrants to Comprise an Increasing Share of a Growing United States
The Pew Research Center has released a new report on U.S. population trends; some of the key findings include:
Posted by John at 5:20 AM | Comments (0) | TrackBack--A continuation of current trends would result in a U.S. population of 438 million in 2050, up from 296 million in 2005. 82% of this increase will be due to immigrations and their U.S. born descendants.
--By 2050, roughly one in five Americans will be immigrants. By 2025, the foreign born share of the U.S. population will exceed the peak reached during the last great wave of immigration a century ago.
--The country's Latino population is forecast to triple in size by 2050, reaching 29% of the population by 2050, up from 14% in 2005.
--Because of the increasing role of births in Hispanic and Asian population growth, a smaller percentage of both groups will be foreign-born in 2050 than is the case today.
--The elderly population in the U.S. will double from 2005 to 2050, and the "dependency ratio" (the number of children and elderly relative to the number of working-age adults) will rise from 59 per 100 in 2005 to 72 dependents per 100 working-age adults by 2050.
Arizona's Economy Feels the Effect of Anti-Immigrant Legislation
Like Oklahoma, Arizona is starting to feel the effects of anti-immigrant legislation passed last year. the New York Times reports:
While data for the last month or so are not available, there were already signs of migration out of Arizona at the end of last year. In the fourth quarter of 2007 the apartment-vacancy rate in metropolitan Phoenix rose to 11.2 percent from 9 percent in the same quarter of 2006, with much higher rates of 15 percent or more in heavily Latino neighborhoods.
"You have many people moving out, but they are not all illegal," said Terry Feinberg, president of the Arizona Multihousing Alliance, a trade group for the apartment and rental housing industry. "A lot of people moving are citizens, or legal, but because someone in their family or social network is not, and they are having a hard time keeping or finding a job, they all move."
In the wake of this fallout and continued inaction on immigration reform at the federal level, a group of Arizona legislators have introduced legislation which would create a state-run temporary worker program.
Posted by John at 5:00 AM | Comments (0) | TrackBackHispanic Media Growth Forecasts Positive
That's the view expressed in a new report from SNL Kagan on the Hispanic TV and radio industry:
Posted by John at 3:25 AM | Comments (0) | TrackBackThe four major U.S. Hispanic broadcast networks — Telemundo, Univision, Telefutura, and Azteca America — had estimated combined revenues of $1.3 billion for 2007, with that figure expected to top $1.6 billion in 2011. Combined cash flow could generate greater growth, jumping to $627 million in 2011 from $460 million in 2006.
Hispanic TV stations can expect slower revenue growth at about 5.4% annually through 2011. SNL Kagan expects Hispanic radio revenue to increase 6% in 2008 to $1.21 billion, outpacing the overall industry's expected growth of 2% to 3%. Over the next four years, radio station revenues are expected to grow at a 4.9% CAGR.
Quote of the Day for Tuesday, February 12, 2008
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February 11, 2008
Barnett Combats the Blues
Since we in the U.S. now seem to have the "war-weary, fearful of Chindia, how low will housing prices go" blues, Thomas P.M. Barnett offers a friendly reminder of what we've got to be thankful for:
We enjoy a wonderfully resilient global economy that's processed numerous financial panics (e.g., Asian flu, Internet bubble) and significant slowdowns by major players (Japan, Europe) over the past two decades while consistently growing.
As a result, poverty has been dramatically reduced around the planet and, as the Economist points out, we've got twice as many fast-growing economies right now as we did during the go-go '80s and '90s.
Yes, it stings having Arab sovereign wealth funds bail out Wall Street firms in the sub-prime crisis, but I dare you to think of a more painless way of re-injecting liquidity back into our markets. . . .
Anyway, by entering at bargain prices, these oil-rich regimes are simply doing what we've long advised: diversifying holdings and connecting their economies more broadly to globalization. It sure beats the alternative of white-elephant projects or military build-ups.
Speaking of guns, let me also remind you that our planet has never been more peaceful: fewer wars, less civil strife and the smallest-ever percentage of humanity engaged in or preparing for mass violence. Washington may wage global war, but nobody else is.
Not surprisingly, while we're polling glum, the rest of the world isn't. Global opinion trends over the past half-decade portray a rising tide of human happiness among nations that have opened up to globalization and thus enjoyed increasing per-capita income.
Across the Islamic world, we also see a broad decline in popular support for terrorism and, in particular, al-Qaida's brutality. We're losing old allies over Iraq, but Osama bin Laden is losing the future. . . .
. . . I say thank God for those whiz kids on Wall Street - you know, the ones who seem to come up with some new, dazzlingly complex risk management scheme every 10 years or so.
I'm not being facetious. It's that type of edgy innovation that keeps the United States the most competitive economy in the world, triggering not just our booms but also the necessary corrections. . . .
Read Barnett's complete commentary here.
Posted by John at 5:24 AM | Comments (0) | TrackBackQuote of the Day for Monday, February 11, 2008
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February 10, 2008
As We Press for Change with a New President, A Point to Remember
Stephen Boyle writes that our presidential candidates, with much talk of "change", are ballooning expectations to levels which cannot possibly be met. Further, Boyle notes, we the people are guilty:
This myth of the all-powerful president persists. The electorate believes that the president can alone right all the wrongs that afflict the nation. Americans view their former presidents through a nostalgic haze in which the merely adequate appear to have been great while the great appear to have been superhuman. The slate of candidates is anxiously assessed to see if any of them could be the next FDR or Kennedy or Reagan, presidents whose myth has substantially overtaken their record. Nostalgia for Reagan is particularly acute this year, even among Democrats.
Yet the fact is that no one can live up to these expectations. Both the candidates and the electorate are guilty of a loss of constitutional perspective. In reality, the president of the US has a distinctly constrained constitutional authority. He cannot make laws, at least not in the all-encompassing way that congress can. He cannot raise taxes, nor declare wars (Iraq was authorised and continues to be funded by congress). He cannot make treaties with other nations. Unlike the British prime minister, he cannot even appoint his own cabinet without approval. The US constitution offers little more than an outline of the presidency, saying more about how the president should be appointed, paid and impeached than about the extent of his powers. On the election of General Dwight Eisenhower as president in 1952, his immediate predecessor, Harry S Truman, laughed. "He’ll sit there all day saying, ‘do this, do that’ and nothing will happen," he said. "Poor Ike—it won’t be a bit like the army." . . . [Complete Prospect article here.]
Contrast Truman's remarks, infused with the wisdom of actual experience, with Hillary Clinton's promises to "manage" the economy better than George W. Bush. As Boyle writes, the President of the U.S. doesn't even manage Congress, a body of 535 individuals, which in the private sector would be a fairly small business. The notion that one person "manages" a $13 trillion economy is laughable.
The power of the President, Boyle writes, is actually the power to persuade. The President may propose legislation to Congress, but has no ability to enact or even introduce such proposals. The President must persuade the people of his views so that they will pressure their Congressional representatives to support him. He must even persuade the bureaucracy of the executive branch to enforce the laws he supports.
Presidents are like coaches in sports: they receive way too much credit when things are going well, and are tagged with too much of the blame when they aren't. We the people invest a tremendous amount of energy for change and reform behind individuals. Individuals can only do so much; they cannot simply do their own will. After the heat generated by enthusiastic campaigns, they must persuade us of the rightness of their actions.
For this, we owe gratitude to the wisdom of our Founding Fathers and the system they created. Thank goodness for such foresight. It's probably saved us more than we'll ever know.
Posted by John at 8:23 AM | Comments (0) | TrackBackQuote of the Day for Sunday, February 10, 2008
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February 9, 2008
The Tide Turns: Prices of Chinese Imports Rising
Posted by John at 8:05 AM | Comments (0) | TrackBack. . . A confluence of events -- the weakening dollar, soaring domestic inflation, new labor laws, the end of some government export subsidies, the increasing cost of raw materials, more stringent product safety regulations, and bad weather -- means the cost of goods produced in Chinese factories is rising fast.
Those increased costs are already showing up in import prices. After falling for years, the price index of goods from China rose 2.4 percent in 2007, according to the U.S. Bureau of Labor Statistics division of international prices. That's the largest annual increase since the index was first published four years ago. . . .
The Biofuel "Cure" Compounds the Illness
The conclusions of two studies recently published in Science won't be too popular in the halls of a Congress slavishly devoted to biofuel subsidies which will "solve" our oil dependence. The New York Times reports:
Together the two studies offer sweeping conclusions: It does not matter if it is rain forest or scrubland that is cleared, the greenhouse gas contribution is significant. More important, they discovered that, taken globally, the production of almost all biofuels resulted, directly or indirectly, intentionally or not, in new lands being cleared, either for food or fuel.
“When you take this into account, most of the biofuel that people are using or planning to use would probably increase greenhouse gasses substantially,” said Timothy Searchinger, lead author of one of the studies and a researcher in environment and economics at Princeton University. “Previously there’s been an accounting error: land use change has been left out of prior analysis.” . . .
Posted by John at 7:45 AM | Comments (0) | TrackBackThese plant-based fuels were originally billed as better than fossil fuels because the carbon released when they were burned was balanced by the carbon absorbed when the plants grew. But even that equation proved overly simplistic because the process of turning plants into fuels causes its own emissions — for refining and transport, for example.
The clearance of grassland releases 93 times the amount of greenhouse gas that would be saved by the fuel made annually on that land, said Joseph Fargione, lead author of the second paper, and a scientist at the Nature Conservancy. “So for the next 93 years you’re making climate change worse, just at the time when we need to be bringing down carbon emissions.” . . .
America's Trends are Good
Michael Lind of the New America Foundation, writing in the UK's Prospect magazine, argues that our future is much brighter than the pessimists allow, and our focus is largely on the wrong problems. Myths of our decline, Lind writes, include forecasts of takeovers by religious fundamentalists, worries of racial and ethnic divides (caused in part by immigration), and predictions that the country cannot financially absorb the wave of baby boomer retirement. In other words, the liberals, the conservatives, and the moderates, respectively, all have a piece of this "America in decline argument".
It's important we get a grip on what our problems really are, Lind argues, so we can address those challenges instead of getting bogged down in misfortunes which never come, to paraphrase Amy Lowell:
Barring catastrophes, the US in 2050 will be much more racially integrated; will remain culturally and linguistically quite homogeneous; and will be much richer, easily able to afford to pay for social security and decent healthcare. And partly as a result of this unity and prosperity, the US will continue to be a major power, though not a solitary hegemon. . . .
Posted by John at 7:14 AM | Comments (0) | TrackBackWhy is there such a gap between the conventional wisdom about America's future and the actual trends? Part of the answer involves the bias toward sensationalism that afflicts all commercial media. Another factor is the distortion of the facts by special interests. For example, the myth of the social security crisis has been spread by, among others, people in the securities industry who would like to see this successful public pension programme privatised.
The US is facing major challenges—but they are not the ones usually identified. Long-term racial and linguistic balkanisation may not be a problem, but class lines in the US are hardening; there is now less social mobility in the US than in Europe. The US is not in danger of becoming a theocracy, but it is in danger of becoming a plutocracy. Social security does not threaten to bankrupt America, but healthcare cost inflation does. The US is not going to be eclipsed any time soon by another superpower, but it may exhaust itself by allowing its commitments to exceed the resources that the public is willing to allot to foreign policy. The sooner the mythical problems can be dismissed, the sooner the genuine challenges to America's future can be identified and addressed.
Quote of the Day for Saturday, February 9, 2008
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February 8, 2008
One Billion People, Up in Smoke
That's the number of people the World Health Organization believes will die of smoking and other tobacco-related illnesses this century, in the absence of any sustained effort to reduce tobacco usage. The WHO's report indicates that almost all of these deaths will occur in developing countries, which lack many of the same anti-smoking efforts developed countries have undertaken for many years.
Almost one-third of the world's smokers are in China, according to the report, and about 100 million Chinese men under 30 will die because of their tobacco consumption unless they quit.
Posted by John at 12:36 PM | Comments (0) | TrackBackBooks on Doing Business in China
The Economist reviews several newly released volumes on the subject here. Yes, these volumes add to a library-sized stack of books on this subject, but don't roll your eyes; Jack Perkowski's Managing the Dragon looks particularly good.
Posted by John at 12:07 PM | Comments (0) | TrackBackHappy Lunar New Year!
I've been on the run and unable to post: Happy Lunar New Year greetings and best wishes for a prosperous Year of the Rat!
Posted by John at 5:57 AM | Comments (0) | TrackBackQuote of the Day for Friday, February 8, 2008
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February 7, 2008
Quote of the Day for Thursday, February 7, 2008
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February 6, 2008
Detroit is a Contrarian's "Buy"
I love posting items in Tidbits which run counter to the conventional wisdom. Here's one that is truly a contrarian opinion: Detroit is poised for a comback. That's what The American's Tom Bethell writes after an extended tour of the city. His analysis is quite lengthy; a taste of it follows:
Posted by John at 4:36 AM | Comments (0) | TrackBack. . . The metaphor that comes to mind in Detroit is the stock that has fallen so far that it’s a “buy.” Something that Daniel Howes said as he drove me across the city made me think that Detroit as a city may indeed be a buy now. He said the big change, taking place even as we spoke, with the new labor contracts at the auto makers, is that all the major players are now on the same page. . . .
By the major players he meant City Hall, the Big Three auto companies, and Big Labor. They all realize that finding scapegoats and strategies of evasion cannot continue. City Hall has been chastened by white flight, by the realization that the responsibility that comes with power cannot be postponed forever. The Big Three have been chastened by the Toyoda clan—by the global economy. And Big Labor, in the form of the UAW, has been chastened by its loss of a million members.
This sentiment was echoed later by David Cole, the oft-quoted chairman of the Center for Automotive Research in Ann Arbor. As a result of the new labor agreements, he said, “What we are witnessing is the transformation from a confrontational way of working to one of collaboration, which is absolutely necessary.”
Badly run companies do go out of business, but Detroit is a historic, physical reality that will be with us for some time. “Up” is about the only direction it has left to go, and that may happen sooner than most people think.
Quote of the Day for Wednesday, February 6, 2008
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February 5, 2008
U.S. Not Ready for Panana Canal Expansion
. . . and if we don't get our act together, it will cost all of us, in the form of higher prices than is necessary; the Dallas Morning News has an extended piece worth your attention. A tidbit follows:
That lack of preparedness could mean higher prices than necessary for imported goods, costly delays in moving U.S. exports out of the country – and economic benefits for Caribbean seaports that might otherwise flow to Houston, Corpus Christi and inland to Dallas.Port directors, shipping company managers, government leaders and financiers at a conference in Tampa, Fla, last week described a slew of problems facing the ports and transportation companies on the Gulf and East coasts as they seek to capitalize on what should be a golden opportunity. . .
The Panamanians are moving ahead to double the capacity of the canal by 2014, said Tampa Port executive director Richard Wainio, "and we're all sitting around not knowing what we're going to do."
Bernard Grossglose, chief executive of the South Carolina Ports Authority, said many U.S. ports need deeper channels to accommodate a giant new class of container ships that will use the expanded Panama Canal. But channel-dredging projects typically take as long as 20 years from proposal to completion because of regulatory and funding delays, he said.
"Panama is like lightning compared to what we deal with," he said. . . .
Shippers like ZIM American already take their largest container ships to th