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]
February 9, 2008
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.” . . .
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) | TrackBackFebruary 4, 2008
Sinking Teeth in Mexico
Reuters reports that Mexico is attracting an increasing number of U.S. citizens seeking cheaper dental care:
Posted by John at 11:22 AM | Comments (0) | TrackBack. . . U.S. dental treatment costs up to four times as much as in Mexico, making it tough for uninsured Americans to treat common problems such as abscessed teeth or pay for dentures.
A dental crown in the United States costs upward of $600 per tooth, compared to $190 or less in Mexico.
Aspiring Mexican dentists are moving to border cities in droves and are luring American patients away from farther flung discount destinations such as Hungary and Thailand. . . .
January 20, 2008
The Internet vs. The Mob
Small business owners in Sicily, weary of long years of forking over protection money to the Mafia, are using the Internet to more effectively band together and find strength in numbers:
. . . The businesses are openly defying the Mafia by signing on to a Web site called "Addiopizzo" (Goodbye Pizzo), which brings together businesses in the Sicilian capital that are resisting extortion.
The campaign was launched in 2004 by a group of youths thinking of opening a pub. They started off by plastering Palermo with anti-pizzo fliers, reading "An ENTIRE PEOPLE WHO PAYS THE PIZZO IS A PEOPLE WITHOUT DIGNITY," and eventually brought their campaign online where it struck a profound chord with Sicilians fed up with Mafia bullying.
Confindustria, the industrialists' lobby, has also boosted the movement with a threat to expel members who pay protection money. Its Sicilian branch has gone through a list of pizzo-paying companies found in a raid on a top Mafia boss' hideout, and this month began summoning heads of those companies to demand to know if they indeed had been paying and should be drummed out of the politically influential lobby. . . .
Read the full account courtesy of Wired; thanks to TP Wire Service for the pointer.
Posted by John at 7:34 AM | Comments (0) | TrackBackJanuary 19, 2008
Who's Building the Border Fence?
The Wall Street Journal's Mary Anastasia O'Grady fills us in:
January 18, 2008
Want A 10 Million Dollar Bill to Stuff in Your Pocket?
It will only cost you $4 U.S. dollars, if you go to Zimbabwe. Inflation has gotten so bad in Zimbabwe's teetering economy that the government is planning on issuing a 10-million dollar bill. On the "black" market (in this case, the free market), this note would be worth the equivalent of $4 U.S.
Officially, inflation is estimated at 25,000%, while many independent observers estimate the actual rate to be 150,000%.
Posted by John at 5:07 AM | Comments (0) | TrackBackJanuary 16, 2008
Beware of Talk of "Energy Independence"
As you listen to presidential candidates of both parties prattle on about how their plans to make the U.S. "energy independent", consider Robert Bryce's five myths of energy independence.
One notion holds that energy independence will reduce terrorism, since our dollars won't be funneled back to the Middle East and ultimately into the hands of terrorists. It's a little naive to think that taking our business away from Saudi Arabia will prevent attacks like that of 9-11, says Bryce. According to the 9-11 Commission, those attacks cost about $400,000 to $500,000 to plan and execute. That's the cost of an angel venture capital deal, not what it costs to bail out Citigroup.
Bryce also notes that the new energy bill "requires" 36 billion gallons of biofuel production nationally by 2022. By contrast, we import about 200 billion gallons of oil a year now. Further, if the entire U.S. production capacity of corn was devoted to biofuels, this move would replace only 6% of the country's oil consumption. That places the shameless sucking up to Iowa corn farmers we saw a couple of weeks ago in perspective, doesn't it?
Read more of Bryce's energy myth busters here. His new book, Gusher of Lies: The Dangerous Delusions of Energy Independence, will be released in March.
Posted by John at 5:38 AM | Comments (0) | TrackBackJanuary 12, 2008
Money and Votes
FactCheck.org reminds us that garnering the most money doesn't equate to getting the most votes in a presidential election. My favorite example among the many cited is John Connally, the first presidential candidate to turn down federal subsidies in order to be free of spending limits. He spent $11 million, got one delegate to the 1980 Republican convention, and was on hand to see Ronald Reagan win the party's nomination that year.
Posted by John at 9:48 AM | Comments (0) | TrackBackGooglevision
Matsushita is teaming with Google:
Matsushita and Google have jointly developed equipment to show content from YouTube, an internet video clip website, clearly on large TV screens. The new Viera plasma TVs, which will debut in the spring in the US, will also include access to Picasa Web Albums, a free online photo-sharing service from Google.
Toshihiro Sakamoto, president of Panasonic AVC Networks, said: "This is the first time mainstream consumers will be able to easily enjoy YouTube videos from the living room with the enhanced quality of a fully integrated widescreen TV experience." [Source: Financial Times]
Yoshi Yamada, head of Panasonic's North American operations, went on to tell the Financial Times that his commodity-oriented products need Google's content to differentiate them in the market.
Here's a company barely ten years old giving a seventy-something year old product a new reason to live.
Posted by John at 7:18 AM | Comments (0) | TrackBackDecember 11, 2007
Britain's Answer for Energy Needs is Blowing in the Wind
Britain's energy future is wind; by 2020 Britain wants to generate up to half its electricity needs from wind turbines which would be installed in the North Sea, the Irish Sea, and along the Scottish coast.
The plan received skeptical reactions from analysts and environmentalists, who see the initiative as having a insufficiently return on investment to be feasible. Who knows, though? Over time, with advances in wind power technology, this seemingly aggressive goal may not be such a stretch.
One thing for sure, GE is ready to help.
Posted by John at 4:57 AM | Comments (0) | TrackBackDecember 9, 2007
Mobile Culture Fact of the Day
Posted by John at 1:04 PM | Comments (0) | TrackBackFor the first time, Japan's fiction bestseller list is dominated by books published, read and, in several cases, written on mobile telephones, mostly by young women in their 20s.. . .
. . . the 2007 bestseller list, published by Japan's biggest book distributor, Tohan, revealed that five of the year's most successful novels, including the top three, were first written for downloading on mobile phones before being republished in book form. [Source: The Australian]
December 7, 2007
Ethanol Subsidies Fuel Food Prices
The Economist offers an extensive analysis of how U.S. subsidies for ethanol, along with rising Asian standards of living, are pushing your food prices upward:
. . . the demands of America's ethanol programme alone account for over half the world's unmet need for cereals. Without that programme, food prices would not be rising anything like as quickly as they have been. According to the World Bank, the grain needed to fill up an SUV would feed a person for a year.
America's ethanol programme is a product of government subsidies. There are more than 200 different kinds, as well as a 54 cents-a-gallon tariff on imported ethanol. That keeps out greener Brazilian ethanol, which is made from sugar rather than maize. Federal subsidies alone cost $7 billion a year (equal to around $1.90 a gallon).
The article goes on to note that net farm income in the United States will be about $87 billion this year, 50% higher than the average of the past ten years.
Posted by John at 5:19 PM | Comments (0) | TrackBackNovember 26, 2007
In the Developing World, "Lifestyle Diseases" Dwarf Other Healthcare Problems
A perverse indicator of rising global incomes and declining poverty rates is the rapidly rising incidence of chronic diseases such as heart disease, strokes, and type 2 diabetes. These "lifestyle diseases" now comprise the greatest share--over 60%--of death and disability worldwide. The science journal Nature reports:
Posted by John at 6:32 AM | Comments (0) | TrackBack. . . Some 80% of chronic-disease deaths occur in low- and middle-income countries. They account for 44% of premature deaths worldwide. The number of deaths from these diseases is double the number of deaths that result from a combination of infectious diseases (including HIV/AIDS, tuberculosis and malaria), maternal and perinatal conditions, and nutritional deficiencies.
Over the coming decades the burden from CNCDs [chronic non-communicable diseases] is projected to rise particularly fast in the developing world. Without concerted action some 388 million people worldwide will die of one or more CNCDs in the next 10 years. With concerted action, we can avert at least 36 million premature deaths by 2015. Some 17 million of these prevented deaths would be among people under the age of 70 . . .
November 25, 2007
iPods over I Vote
Posted by John at 8:19 PM | Comments (0) | TrackBackA poll of New York University students revealed that 20% would give up their vote in the next election for an iPod and two-thirds would do so for a year's college tuition. Half would renounce their vote permanently for $1m.
November 17, 2007
Wherefore Art Thou Internet?
According to a Zogby Poll, 31% of singles believe the internet can serve as a replacement for a significant other. [Hat tip: The American]
Posted by John at 6:16 AM | Comments (0) | TrackBackNovember 12, 2007
Think Your Doctor Has to be Local?
Think again; devices like this one will change the geography of doctor and patient:
Posted by John at 3:06 AM | Comments (0) | TrackBackUsing a device that's roughly the size and price of an upscale cell phone, a team of Berkeley Engineering doctoral students hopes to halt the spread of diseases afflicting millions in the developing world.
Dubbed SeroScreen, the handheld instrument will test blood and other bodily fluids for the presence of infection. It will deliver an on-site diagnosis within minutes for influenza, skin infections, mosquito-borne viruses and many other ailments. Because the microdevice is quick, portable and cheap, it could dramatically reduce testing delays and prevent contagious diseases from becoming epidemics in poor and remote regions, the students say. . . .
[Hat tip: Smart Mobs]
November 11, 2007
Welfare Farming
Almost $268 billion was paid last year in subsidies to farmers in the 30 mainly rich countries of the OECD, down from $281 billion in 2005. This huge support, both directly from taxpayers and indirectly through higher prices paid by consumers, fell from 29% of total farm receipts to 27%. The drop was mainly because of higher world food prices, which reduced the need to prop up domestic prices, rather than changes in policy. Even so, crop and livestock prices in OECD countries were on average 21% higher than world market prices in 2006. The level of support varied widely, from 1% of farm receipts in New Zealand to more than 60% in Switzerland. In America it amounted to 11%, whereas in the EU it came to 32%.
To offer some perspective, only about 30 countries in the world have a GDP higher than $268 billion. Through the double whammy of your taxes and the higher than necessary food prices you pay, you are financing this redistribution of income.
Posted by John at 12:57 PM | Comments (0) | TrackBackNovember 9, 2007
This Just In: China and India to Drive Energy Demand
The World Energy Outlook 2007, produced by the International Energy Agency, offers forecasts for future energy demand which will surprise no one:
--Worldwide energy needs are expected to grow by 55% from 2005 to 2030.
--Developing economies will account for about three-quarters of this increase, with China and India alone accounting for 45% of the gain.
--Among energy sources, coal use will experience the greaterest increase, jumping 73%; China and India will account for most of this increase.
--$22 trillion in supply infrastructure spending will be required to meet worldwide energy demand by 2030.
An executive summary and the complete report can be found here.
Posted by John at 2:56 AM | Comments (0) | TrackBackOctober 28, 2007
A Supercomputer You Can Get Your Hand Around
It's only 10 to 15 years in the future, according to nanotechnology researchers. [Source: PC World]
Posted by John at 4:52 AM | Comments (0) | TrackBackOctober 23, 2007
The Google Effect
From 2004 to 2006, roughly $19 billion in wealth was monetized from Google employees exercising options and selling shares. That sum is greater than the GDP of Panama, Iceland, or Bahrain. [Source: Mercury News]
Posted by John at 6:03 AM | Comments (0) | TrackBackOctober 22, 2007
Bright and Sunny Forecast for Solar Power
Believe it or not, solar power could be the world's leading source of electricity by the end of this century; that's not the opinion of dreamy-eyed idealists, but those willing to put real money at stake. Reuters reports:
. . . Subsidies are needed because solar is still more expensive than conventional power sources like coal, but costs are dropping by around 5 percent a year and "grid parity," without subsidies, is already a reality in parts of California.
Very sunny countries could reach that breakeven in five years or so, and even cloudy Britain by 2020.
"At that point you can expect pretty much unbounded growth," General Electric Co's Chief Engineer Jim Lyons told the Jefferies conference in London on Thursday, referring to price parity in sunny parts of the United States by around 2015.
"The solar industry will eventually be bigger than wind."
The United States' second largest company, GE is a big manufacturer of wind turbines and wants to catch up in solar, said Lyons. . . .
. . . The industry could halve costs and achieve parity in significant markets including the United States, Japan and parts of southern Europe by 2012, said Erik Thorsen, chief executive of the world's biggest solar power company Renewable Energy Corp.
"If grid prices go up at the present rate if could happen before," he told Reuters.
REC expects to halve costs on new production by 2010. German solar power company Q-Cells AG, the world's second biggest maker of solar cells, expects similar cuts by making more components itself, thinner than before, and by using cheaper techniques for processing the silicon raw material.
The solar sector has grown at 40 percent per year despite a shortage of silicon, but that bottleneck should ease over the next two to three years, said executives. . .
Thanks to Future Pundit for the pointer.
Posted by John at 5:36 PM | Comments (0) | TrackBackOctober 21, 2007
Who are We Protecting?
Security screeners at two of the nation's busiest airports failed to find fake bombs hidden on undercover agents posing as passengers in more than 60% of tests last year, according to a classified report obtained by USA TODAY.
Screeners at Los Angeles International Airport missed about 75% of simulated explosives and bomb parts that Transportation Security Administration testers hid under their clothes or in carry-on bags at checkpoints, the TSA report shows.
At Chicago O'Hare International Airport, screeners missed about 60% of hidden bomb materials that were packed in everyday carry-ons — including toiletry kits, briefcases and CD players. San Francisco International Airport screeners, who work for a private company instead of the TSA, missed about 20% of the bombs, the report shows. The TSA ran about 70 tests at Los Angeles, 75 at Chicago and 145 at San Francisco. . .
Rest easy, folks, we're now taking that same level of "protection" to the Mexican border:
Posted by John at 11:33 AM | Comments (0) | TrackBackUnited States border agents have stepped up scrutiny of Americans returning home from Mexico, slowing commerce and creating delays at border crossings not seen since the months after the Sept. 11 attacks.
The increased enforcement is in part a dress rehearsal for new rules, scheduled to take effect in January, that will require Americans to show a passport or other proof of citizenship to enter the United States. The requirements were approved by Congress as part of antiterrorism legislation in 2004. . . .
The new policy is a big shift after decades when Americans arrived at land border crossings, declared they were citizens and were waved on through. Since the authorities began ramping up enforcement in August, wait times at border stations in Texas have often stretched to two hours or more, discouraging visitors and shoppers and upsetting local business.
The delays could remain a fact of life across the southern border for the next few years, border officials said, at least until new security technology and expanded entry stations are installed and until Americans get used to being checked and questioned like foreigners. [emphasis mine] Last year 234 million travelers entered the United States through land border crossings from Mexico. . . .
September 30, 2007
Dodo Businesses
Entrepreneur picks ten businesses facing extinction within ten years; their list includes several predictable selections: newspapers (in print, that is), pay phones, used bookstores, camera film manufacturing, and record stores.
How about transcription services? Can we hope that in ten years we'll be relieved of the spaghetti bowl mess of wires behind our computers and televisions?
Posted by John at 7:32 PM | Comments (0) | TrackBackSeptember 27, 2007
Nuclear Powering Up
The first new application to build a nuclear power plant was filed this week by NRG Energy; almost 30 more applications for greenfield nuclear facilities are expected over the next 15 months. The Christian Science Monitor reports.
Posted by John at 9:22 PM | Comments (0) | TrackBackJuly 22, 2007
Another Reason for Optimism: Worldwide Movement to Entrepreneurism
. . . Half the managers and business leaders in younger, emerging markets were ready to embrace entrepreneurship, even when working in large organisations, compared to just over a quarter in Europe and the UK.
And in Africa, almost nine out 10 managers in believed entrepreneurialism was something that could be developed and nurtured, against just over a third in the UK and the rest of Europe.
Less constrained by tradition, managers from emerging markets are more open to risk taking and creating a more flexible environment and culture, argued McKinney Rogers. . . .
[Thanks to TP Wire Service for the pointer.]
Posted by John at 4:04 AM | Comments (0) | TrackBackJuly 8, 2007
Iranian Mullahs Partying Like It's 1999
When you mix a unpopular regime, a young population, and an economy heavily tied to a government (mis)managed energy industry, you've described Iran today, and you have the makings of regime change, contends John Mauldin of Millennium Wave Advisors. Mauldin believes that Iran is likely, within the next decade, to become a friend of the United States. Read the entire analysis here; a tidbit follows:
Oil provides more than 70% of the revenues of the government of Iran. The rise in oil prices has been a bonanza for the regime, allowing them to subsidize all sorts of welfare programs at home and mischief abroad. And one of the chief subsidies is gasoline prices.
Gasoline costs about $.34 cents a gallon in Iran, or 9 cents a liter. You can fill up your Honda Civic for $4.49. In the U.S. it costs almost $40. In neighboring Turkey it costs almost $95. Iran is spending 38% of its national budget (almost 15% of gross domestic product) on gasoline subsidies!
And this situation is likely to get worse. Let's look at a rather remarkable peer-reviewed study done for the National Academy of Sciences by Roger Stern of Johns Hopkins University late last year. Stern's analysis is somewhat political, in that he is critical of current U.S. Iranian policy, but this is just one of several studies that show the same thing:
"A more probable scenario is that, absent some change in Irani policy ... [we will see] exports declining to zero by 2014 to 2015. Energy subsidies, hostility to foreign investment and inefficiencies of its state-planned economy underlie Iran's problem, which has no relation to 'peak oil.'"
Iran earns about $50 billion a year in oil exports. The decline is estimated at 10% to 12% annually. In less than five years, exports could be halved and then disappear by 2015, predicted Stern. . . .
Not surprisingly, at 34 cents a gallon, gasoline demand is rising 10% a year. This week, the government moved to ration supplies to about 22 gallons a month, which does not go far in the large cars preferred by younger Iranians. There have been riots, with people chanting "Death to Ahmadinejad." They take their right to plenty of cheap gas seriously. . . .
With Soviet-style five year plans, corruption, subsidized prices, inefficient state-owned enterprises and 14% unemployment among college graduates, Maudlin believes Iran looks like the Soviet Union did in 1988.
Posted by John at 7:30 AM | Comments (0) | TrackBackJuly 6, 2007
Harry Potter and Afghanistan, sans Opium
The total dollars (books and movies) generated by J.K. Rowling's Harry Potter series is roughly equal to the GDP of Afghanistan: $7.2 billion. [Hat tip to Paul Kedrosky, via iPienso.]
iPienso points out that this estimate clearly does not include the value of the opium trade in the country. The Economist says the street value of Afghan opium in consuming countries is $60 billion.
Posted by John at 7:22 PM | Comments (0) | TrackBackJuly 1, 2007
If America Were a Stock . . .
. . . it would have a “buy” rating, because it’s underestimated worldwide and therefore undervalued, says the Economist. America’s greatest strength, says this editorial, is its ability to correct itself, more so than any other major country in the world.
Posted by John at 2:23 PM | Comments (0) | TrackBack
June 15, 2007
One Reason to Be An Optimist on America's Future: Teenage Entrepreneurs
The U.S. is unusual in the developed world in that the start-up rate among 18-24 year olds is higher than that of 35-44 year olds; Tyler Cowen comments in the New York Times on why America's teenagers are so entrepreneurial:
Posted by John at 3:59 AM | Comments (0) | TrackBackThe fact that American schooling is less disciplined than that in other countries gives young creators the time and the energy to accomplish something outside their formal education. . .
The longstanding criticism of the American school system is that even in the better schools, too many students just "get by" rather than engage in a rigorous curriculum. This academic leniency is bad for many average or subpar students, but it also allows some students to flourish. Relatively loose family structures have similar effects; American children are especially likely to be working on their own projects, rather than being directed by parents and elders. . .
June 9, 2007
My Kingdom for a Flush Toilet!
Steven Landsburg offers "A Brief History of Economic Time" in the Wall Street Journal which deftly explains why looking only at increases in income does not capture actual gains in standards of living:
. . . increases in measured income -- even the phenomenal increases of the past two centuries -- grossly understate the real improvements in our economic condition. The average middle-class American might have a smaller measured income than the European monarchs of the Middle Ages, but I suspect that Tudor King Henry VIII would have traded half his kingdom for modern plumbing, a lifetime supply of antibiotics and access to the Internet.
Read Landsberg's entire commentary; it's worth your time.
Posted by John at 8:40 AM | Comments (0) | TrackBackJune 5, 2007
While Poland May Be Healing, Cuba is Still in a Coma
In 1989, Polish railway worker Jan Grzebski went into a coma following a accident on this job. At the time, Communist strongman Wojciech Jaruzelski was in charge and the economy was in shambles.
Miraculously, Grzebski just came out of his coma; his homeland is now a democracy with a liberalized economy, boasts GDP growth of better than 7%, and has plans to erect a statue of President Ronald Reagan.
While happy to be alive and grateful to his wife whose care is credited with his recovery, Grzebski is still in a daze:
"When I went into a coma there was only tea and vinegar in the shops, meat was rationed and huge petrol lines were everywhere," Grzebski told TVN24, describing his recollections of the communist system's economic collapse.
"Now I see people on the streets with cell phones and there are so many goods in the shops it makes my head spin."
Sadly, anyone coming out of a 19 year coma in Cuba doesn't see much of a difference in the place, as Bella Thomas writes in Prospect, yet visitors (and filmmakers) from the West continue to romanticize the "revolution":
. . . [The Cuban people] are far poorer than their eastern European counterparts were in 1989: the average wage, at $20 a month, can barely feed a single person for a couple of weeks. You cannot spend any length of time in Havana without noticing the lack of food for the majority of Cubans. The mother of a friend, an old lady who lived in one tiny rotting room in a former brothel with her son, gets by selling matchboxes to her neighbours, having stolen them from the factory where she worked. Another acquaintance keeps pigs on her balcony and sells pork to a few locals. The luckier ones sell cigars or taxi rides to foreigners. An elite work in hotels.
Healthcare and education are supposed to be the redeeming graces of the regime, but this is questionable. There are a large number of doctors, but, according to most Cubans I know, many have left the country and the health system is in a ragged state—-apart from those hospitals reserved for foreigners—-and people often have to pay a bribe to get treated. Michael Moore, the American film director, who has recently been praising the system should take note of the real life stories beneath the statistics. I went into a couple of hospitals for locals on my latest visit. In the first, my friend told me not to say a word in case my accent was noticed, as foreigners are not allowed in these places. I was appalled by the hygiene and amazed at the antiquity of the building and some of the equipment. I was told that the vast majority of Cuban hospitals, apart from two in Havana, were built before the revolution. Which revolution, I wondered; this one seemed to date from the 1900s.
On another occasion, I saw a man in a white coat with a stethoscope around his neck hurrying along the boulevard of Vedado, in west Havana. We struck up a conversation. He was on his way to the hospital around the corner. I asked him if he would take me there. He was charming and intelligent, and had that ease of communication that many Cubans possess: he wasn't at all taken aback by an unknown woman in dark glasses asking to accompany him to work. The doctor told me that I shouldn't be too shocked; the hospital was being "refurbished." The building certainly was in a state of filth and decrepitude. This was not a place one would want to be ill in.
There are success stories, such as the biotechnology industry, but these are exceptions. Most Cubans know this. Most also know that liberalisation is vitally needed, but they are cautious about speaking openly, partly because they have too much else to think about (such as how to get food), partly because living under a dictatorship generates extraordinary levels of patience, and partly because questioning the regime can lose you your job or even land you in prison. . .
Thomas suggests that were the U.S. to end its embargo, the resulting flood of capital into the country would make the Castro regime sicko. Maybe then the average person in Cuba would receive the same healthcare which enabled Jan Grzebski to wake up and see the eleven grandchildren born to his four children while he was in a coma.
Posted by John at 4:46 AM | Comments (0) | TrackBackApril 27, 2007
America Likes Small Business
Americans like business, especially small business:
Posted by John at 10:00 PM | Comments (0) | TrackBackPew [Research Center] has polled Americans nineteen times on this topic over two decades. In that period, the late 2005 sample was the only time where Americans had even come close to holding a negative view of business. Business has averaged a favorability rating of 61 percent in Pew’s polling. In the latest asking, 57 percent of respondents, including majorities of Republicans and Democrats, characterized their overall opinion of business corporations as "very" or "mostly" favorable—only one point lower than when Pew first asked in 1985. In short, business quickly bounced back.
Small business fares even better with the public. According to Harris Interactive’s March 2007 survey, small business was the mostly favorably-viewed institution in the country. It beat out every other institution named including the military, universities, and religion. Why do Americans hold such favorable opinions of business, especially when compared to politicians? The answer is simple. By overwhelming majorities (72 percent in Pew’s latest asking) Americans say that the strength of this country is mostly based on the success of American business. This is a vote of confidence most politicians and political parties could only dream of. . . .
April 25, 2007
The Young Shall Inherit Brand Value
Just slightly younger than my nine year old daughter, Google has build the highest brand value, $66.4 billion, of any company in the world, according to a study (pdf) by Millward Brown Optimor. General Electric, which celebrates its 115th birthday this year, is second with a brand value of just under $62 billion.
If you accept Millward Brown's results--and I have no reason to refute them, based on my own personal usage and awareness of each company's products--then Google's brand value is 45% of its market capitalization, while GE's brand is only 17% of its market value.
Posted by John at 12:38 PM | Comments (0) | TrackBackApril 18, 2007
Water Party in Phoenix
What do you have when Phoenix, surrounded by desert and in the midst of a multi-year drought, is paying among the nation's lowest water rates, and constantly moist Seattle's water is the nation's most expensive?
You've got a screwed-up situation caused by government invention in Arizona and other Western states which prevents a natural lower of demand which would be achieved through market-based pricing.
Thanks to the Coyote Blog for a terrific example of how poorly the public, its government, and particularly its media understand basic economic theory:
[Local media] articles blame global warming and lack of conservation and development and too many lawns and not enough low-flow faucets and talk about the need for government rationing, but never once mention PRICE. We have the scarcest water in the country and one of the lowest prices for water. Talk about ignoring the elephant in the room. I should have just labeled this post "Duh!"
Read the entire illuminating post, including Coyote's "five minute solution" to the problem.
Posted by John at 3:57 AM | Comments (0) | TrackBackApril 17, 2007
Outsourcing Morphs Into Collaborative Networks
Oren Harari offers a very insightful commentary on the future of outsourcing, a piece I encourage you to read in its entirety:
. . . Increasingly, cutting-edge companies are defining themselves as global webs of best-of-breed relationships, as seamless networks of talent and resources not limited by geography. In that context, the value and health of the company is based in large part on the value and health of its partners, and thus the traditional stereotype of internal vs. outsourced, or domestic vs. offshored, becomes less and less germane. Thats why companies as diverse as GE and Proctor and Gamble have numerous ventures and research labs outside the U.S., and view much of their future growth and competitive advantage as coming from new products and systems developed by partners outside the U.S. . .
Large Indian outsourcing firms such as Tata are morphing into something a little more complex than the Lou Dobbs stereotype, and it's good for the global economy, including the U.S.:
Posted by John at 4:05 AM | Comments (0) | TrackBack. . . Once a simple source of offshoring for American firms, Tata has become so successful that it is now expanding into countries like China, Brazil, Chile, Hungary, and the U.S.and hiring the locals (like 10,000 U.S. employees). One could legitimately argue that Tata is outsourcing the outsourcing business, but that's the wrong paradigm. Increasingly, in all businesses, the new strategic conversations will be about borderless collaborations. The new organizations will be hubs of best-in-class capabilities and contributions from anywhere around the world. And Tata, like GE and Ericsson, will be part of that paradigm. . . The net result will be more corporate growth and more jobs everywhere. American companies that outsource their IT functions to Tata grow and hire more Americans. As Tata grows, it hires more Americans. Meanwhile, as American and non-American companies grow, they hire more non-Americans elsewhere. . .
April 16, 2007
Highly Charged Future for Battery Technology
FuturePundit examines the future of battery technology, advances in which will be quite disruptive to the fossil fuels industry:
. . . Consider the benefits of battery advances. Sufficiently advanced battery technologies will some day enable cars to run 100 and more miles between recharges. This capability will end the use of liquid fuels for most local travel. Liquid fuels will continue to get used in longer road trips, air flights, and in ships. But for most commutes and trips to stores batteries will displace gasoline, diesel, and ethanol.
The ability to use batteries for transportation will, in turn, enable the use of nuclear, solar, geothermal, and wind power for transportation. . . .
See the full post here.
Posted by John at 4:05 AM | Comments (0) | TrackBackApril 11, 2007
Tariffs Screw Poor People
Treasury Secretary Hank Paulson recently delivered a speech on the benefits of trade to the American consumer. In the speech he noted how regressive tariffs really are.
"Regressive" is a nice way of saying that tariffs screw poor people, and in this case, single mothers in particular. If politicians (of either party) were really concerned with the standard of living of lower income people in this country, they would not support tariffs which jack up the prices on basic necessities. If you think my characterization is a little over the top, check out this analysis from the Progressive Policy Institute:
Posted by John at 8:35 PM | Comments (0) | TrackBack. . . The tariff system is mainly a tax on want, raising most of its revenue on life necessities and cheap consumer goods, and affecting poor families with children more than anyone else. Last year, clothes raised about $9 billion of the total $25 billion in tariff revenue, shoes brought in another $2 billion -- nearly as much as cars. Food raised $600 million, mostly from cheese, butter, orange juice, and canned tuna. Cheap household goods, including: towels, forks, spoons, suitcases, drinking glasses, and plates, added about $2 billion more.* Altogether, life necessities and mundane consumer products make up about 10 percent of imports but raise about 60 percent of tariff revenue.
These goods are most important in the lives and budgets of poor families with children. The Bureau of Labor Statistics' Consumer Expenditure surveys show that a typical top-ten-percent family spent about 4.4 percent of its pre-tax income on food and clothes (excluding alcohol and restaurant meals) in 2005, and the comparable bill for a single-parent family was 15.8 percent of income. Any flat tariff on shoes and clothes, therefore, would hit single moms about three times as hard as rich families. The actual tariff system is not flat, though, but steeply tilted against poor people, as tariffs are systematically high on cheap products but low on luxury goods. Sterling silver forks, for example, have no tariff while cheap stainless steel forks get 20 percent. A long-sleeved men's silk shirt has a 1.1 percent tariff and its polyester equivalent 25.9 percent; silk brassieres get 2.7 percent, while cotton and polyester bras get 16.9 percent. Shoes, luggage, plates, drinking glasses, skirts, and similar products are just the same. . . .
April 7, 2007
Spain's Economic Renaissance
Its largest corporations are focused on making large overseas acquisitions, businesses enjoy more flexible labor work rules than in neighboring European countries, and its immigrant population is the Continent’s fastest growing. The economic statists both on the right and the left would find a lot not to like in this picture, yet Spain is arguably Europe’s most vibrant economy. The Los Angeles Times has a profile.
Posted by John at 9:04 AM | Comments (0) | TrackBackApril 4, 2007
Paper Trade Hypocrisy
"The Chinese economy is replete with subsidies," Undersecretary of Commerce for International Trade Franklin L. Lavin said in an interview Monday. "It gives Chinese exporters an unfair advantage in the U.S. market, and we're determined to do what we can to unwind that advantage."
The quote comes from the Washington Post account of the U.S. Commerce Department decision to place tariffs on Chinese imports of glossy paper. I could almost hear the organ music reaching a crescendo in the background as I read it.
Such a remark is blatantly hypocritical, Greg Rushford points out. If you’re interested in a succinct explanation of how unctuous U.S. trade policy can be, read this essay in full:
. . . while it is fine for the U.S. Commerce Secretary to rail against Chinese government-sponsored tax breaks, loans and such, what about the billions of subsidized tax breaks, soft loans, etc. that the U.S. steel lobby has been living on for decades? As for Mr. Gutierrez's suggestion that American farmers suffer because of China's subsidies on manufactured goods, one need only consider the billions upon billions of annual U.S. farm subsidies that flood global commodity markets with below-cost American foodstuffs, to the detriment of struggling farmers in every poor corner of the world. Most importantly, the new policy that Mr. Gerard touts doesn't, in fact, apply the same rules to China as all other global traders must comply with.
Commerce insists on treating China as a "non-market" economy in anti-dumping cases. Because this methodology allows U.S. officials to assume that all pricing in China is government controlled, the bureaucrats already have vast discretion to apply high tariffs that penalize suspected subsidies. While the coated-paper subsidy case would hit China with tariffs in the 10%-20% range, Commerce is also considering tariffs of perhaps 100% in a parallel antidumping suit that targets the same glossy paper. In the international trade bar, it's called double counting -- taxing China as a non-market economy in antidumping cases while treating China as a market economy to calculate countervailing duties.
The real unfairness is in the non-market methodology itself, and how it allows U.S. officials to use obviously distorted numbers to come up with unreasonably high antidumping tariffs on Chinese exports. In this case, U.S. bureaucrats determine what China's prices "should" be by consulting pricing and business data derived from surrogate "market economy" countries, quite often India. Last year, Commerce officials hit Chinese manufacturers of polyester staple fiber with antidumping tariffs as high as 109% -- ignoring costs of production in China and using Indian government statistics instead.
Pretending that selected economic statistics from India reflect the true costs of producing anything in China is hardly a model of intellectual honesty. But the U.S. Congress has written the trade laws to allow such obvious economic distortions.
If officials in Washington were serious about attacking the fundamental issue of Chinese government subsidies, the better way to do that would be to challenge them in the World Trade Organization -- where the rigors of international law would trump politics, not the other way around. . . .
The politics of this situation are transparently clear. It’s quite likely, as with the case of Canadian softwood lumber, that the Bush Administration would lose this case if they took their complaints to the WTO. It’s much easier, and the politicians get to appear much tougher (and pander to their protection-seeking corporate contributors) to unilaterally apply tariffs. A Chinese appeal to the WTO likely wouldn’t be decided for quite some time, most likely after the presidential election. If the WTO declares the tariffs are a violation, then the decision is not only deferred, but the heat gets deflected toward a world rule making body and away from domestic politicians. It’s a delicious political freebie for both the Bush administration and members of Congress wanting to please their protection-seeking business constituents.
Let’s remember what tariffs really are. They amount to a tax increase on the consumers of glossy paper. Those millions of consumers, both businesses and individuals, do not have lobbyists in Washington arguing on their behalf in this case. A 10% or more increase in their paper cost, the amount of the tariff, isn’t enough to take the time and trouble to lobby Washington Further, maybe most members of this diffuse group of consumers haven’t even figured out what’s going on yet. The other side, focused on protection from competition, wins.
So you get to pay more for all the glossy paper products you use.
Posted by John at 8:27 AM | Comments (0) | TrackBackApril 3, 2007
Who Really Wants to Live in the "Good Old Days"?
While we are seemingly nostalgic for the “good old days”, not too many people, based on their actions, really want to go back in time. Kevin Kelly believes that’s a sign that today is better than yesterday, tomorrow will be better, and that as a society we will affirmatively embrace progress:
Moving back into the past has never been easier. Citizens in developing countries can merely walk back to their villages, where they can live with age-old traditions, and limited choices. If they are eager enough, they can live without modern technology at all. Citizens in the developed world can buy a plane ticket and in less than one day can be settled in a hamlet in Nepal or Mali. If you care to relinquish the options of the present and adopt the limited choices of the past you can live there the rest of your life. Indeed you can choose your time period. If you believe the peak of existence was reached in Neolithic times you can camp out in a clearing in the Amazon; if you suspect the golden age was in the 1890s, you can find a farm among the Amish. We have the incredible opportunity to head into the past, but it is amazing how few people really want to live there. Except for a few rare individuals, no one does. Rather, everywhere in the world, at all historical periods, in all cultures, people have stampeded by the billions into the future of "of slightly more options" as fast as they can.
Why? Because the future is slightly better than the past. And tomorrow will be slightly better than today. And while everyone's actions confirm the essential reality of progress, progress is not something we have been willing to admit to in public. I am optimistic that in the coming years we'll embrace the reality of progress.
Thanks to Russ Roberts’ EconTalk podcast interview with Kelly for the pointer. EconTalk, by the way, is one of my favorite podcasts.
Posted by John at 11:44 AM | Comments (0) | TrackBackApril 1, 2007
Corn Prone?
Corn farmers haven’t had it this good for a long time:
With demand for ethanol pushing corn prices to $4 a bushel or higher, it was not a surprise that farmers intended to plant a lot more corn this season.
What was surprising about the Agriculture Department report released yesterday was just how much they intended to plant — a staggering 90.5 million acres, the most since World War II and 15 percent more than last season. . . .[Source: New York Times]
Meanwhile, over at the Department of Energy:
New technology to make ethanol from crops such as grasses and trees instead of corn could ease price spikes of the grain within a decade, a U.S. Energy Department official said on Wednesday.
"I'm not going to predict what the price of corn is going to do, but I will tell you the future of biofuels is not based on corn," U.S. Deputy Energy Secretary Clay Sell said in an interview.
Output of U.S. ethanol, which is mostly made from corn, is expected to jump in 2007 from 5.6 billion gallons per year to 8 billion gpy, as nearly 80 bio-refineries sprout up. . . . [Source: Reuters]
If you don’t care to take into account the opinion of a political appointee at the DOE, then consider Tom Friedman’s comments on CNBC’s Tim Russert Show this weekend. Friedman said the letters he gets falls into two general categories: the ones from teachers, parents, and school officials who want to share their success in improving student interest and test scores in math and science, and letters from entrepreneurs and inventors telling him about their progress in alternative energy sources.
Friedman’s message is one of high optimism. It’s hard to tell which alternative energy technologies will be widely adopted, but the amount of innovation and experimentation occurring is so significant, Friedman says, that our economy will undergo a significant overhaul of our energy sources over the long haul.
Consequently, it’s probably more than a little dangerous to bet on corn, or any other single energy source. (My opinion, not Friedman’s.) I hate to use the “b word”, but over the next several years alternative energy could make tech in 1999 look tame by comparison.
Posted by John at 9:09 PM | Comments (0) | TrackBackMarch 24, 2007
Gored Truth on Manufacturing
Pat Cleary, who’s ShopFloor.org blog I regularly enjoy, writes that Al Gore, in testimony before Congress earlier this week, referred to China as “the Saudi Arabia of manufacturing”. The implication, of course, is that China is world’s largest manufacturer.
The facts speak otherwise, notes Cleary. The United States, in fact, has the world’s largest share of manufacturing GDP, at 24%. Japan is second with 21%. China, in fact, is a distant third with a 9% share.
Now that’s an inconvenient truth.
Posted by John at 10:14 AM | Comments (0) | TrackBackMarch 22, 2007
Americans Economically Content, Yet Headlines Read Otherwise
Poll after poll indicates that Americans feel more secure than ever, feel good about their work and their job security, and are generally happy with the money they make. Yet, writes economist Kevin Hassett, much of the media, along with vote seeking politicians, keep pounding away at the notion that the rich have co-opted the country for themselves and the middle class is being squeezed. Quite simply, the facts are being twisted, and it poses a particular problem:
Americans feel so much better than we have been led to believe because they look at their wallets and not the New York Times when deciding what they think about the world.
But the general feeling of unease that is drummed up by the media has a real effect.
Most importantly, it creates a climate within which politicians are tempted to create big government programs to protect folks from increased danger that isn't there. Those measures, which would take us in the direction of the European welfare state, would surely harm just those individuals they purport to help. Voters might even be tricked into supporting them.
Even though most individuals feel secure, they might sympathize with those many others who don't and favor taking steps to help them.
It is time that we face up to an important fact: The basic characteristics of our economy are steadily being misrepresented by individuals with a blatant anti-market political agenda. The U.S. economy has prospered because free markets work. It's not a nightmare, it's a dream.
As I’ve noted previously, despite all the talk about those individuals hurt by global competition, we don’t really spend much money helping displaced workers in this country, relative to the amount of money poured into protectionist schemes to safeguard profits in industries like textiles, sugar, milk, and cement.
Posted by John at 9:38 PM | Comments (0) | TrackBack