I have a positive feeling about this relationship.
Showing posts with label Economics / Politics. Show all posts
Showing posts with label Economics / Politics. Show all posts
Sunday, March 15, 2009
Thursday, November 27, 2008
Monday, November 10, 2008
Power on Sergio, at Colbert
I've been watching a lot of Stephen Colbert and Jon Stewart recently - not yet to the point in which they are my most reliable newssource (as it is for some people), but still, they're fun and informative.
And sometimes you have good thought as well. For instance, here's an interview from a great scholar (and close Obama adviser), who's written a book about one of the greatest Brazilians ever.
By the way last month's Esquire magazine had a fun (though slightly cheesy) profile of Ms Power, focusing on their wedding to a fellow prominent scholar to create what the author called "the Brangelina of academics".
And sometimes you have good thought as well. For instance, here's an interview from a great scholar (and close Obama adviser), who's written a book about one of the greatest Brazilians ever.
By the way last month's Esquire magazine had a fun (though slightly cheesy) profile of Ms Power, focusing on their wedding to a fellow prominent scholar to create what the author called "the Brangelina of academics".
Wednesday, October 22, 2008
Local Sports Franchise Pandering
I've been watching Daily Show over the internet every day, sometimes twice a day.
Like this snippet. "Et tu Messiah?" - brilliant, brilliant.
Like this snippet. "Et tu Messiah?" - brilliant, brilliant.
Monday, September 22, 2008
Sunday, September 14, 2008
Tuesday, August 19, 2008
South Ossetia isn't Kosovo
I must confess I still haven't finished reading God Is Not Great (stuck at around 2/3 of the book after almost a year), but, alas, I just love Christopher Hitchens's prose.
He excels again at this forceful article about the ongoing conflict in the Caucasus. In it, 'Hitch' offers us, yet again, what he does best: combining his vast knowledge of international affairs with his exquisite writing and wit, to come up with fact-based analyses that uncomplicate the complicated.
He excels again at this forceful article about the ongoing conflict in the Caucasus. In it, 'Hitch' offers us, yet again, what he does best: combining his vast knowledge of international affairs with his exquisite writing and wit, to come up with fact-based analyses that uncomplicate the complicated.
Sunday, July 27, 2008
Blame game
Right. Weeks of unprecedentedly toiling work prevented me from posting here, but that doesn't mean I've been oblivious to what's going on. Especially when I figured how to embed this video down here:
Monday, June 09, 2008
Renewable sources
Brilliant, from "The World is Flat"'s Tom Friedman in the NY Times.
Visiting Israel sounds cool.
People vs. Dinosaurs By THOMAS L. FRIEDMAN
Tefen Industrial Park, Israel
Question: What do America’s premier investor, Warren Buffett, and Iran’s toxic president, Mahmoud Ahmadinejad, have in common? Answer: They’ve both made a bet about Israel’s future.
Ahmadinejad declared on Monday that Israel “has reached its final phase and will soon be wiped out from the geographic scene.”
By coincidence, I heard the Iranian leader’s statement on Israel Radio just as I was leaving the headquarters of Iscar, Israel’s famous precision tool company, headquartered in the Western Galilee, near the Lebanon border. Iscar is known for many things, most of all for being the first enterprise that Buffett bought overseas for his holding company, Berkshire Hathaway.
Buffett paid $4 billion for 80 percent of Iscar and the deal just happened to close a few days before Hezbollah, a key part of Iran’s holding company, attacked Israel in July 2006, triggering a monthlong war. I asked Iscar’s chairman, Eitan Wertheimer, what was Buffett’s reaction when he found out that he had just paid $4 billion for an Israeli company and a few days later Hezbollah rockets were landing outside its parking lot.
Buffett just brushed it off with a wave, recalled Wertheimer: “He said, ‘I’m not interested in the next quarter. I’m interested in the next 20 years.’ ” Wertheimer repaid that confidence by telling half his employees to stay home during the war and using the other half to keep the factory from not missing a day of work and setting a production record for the month. It helps when many of your “employees” are robots that move around the buildings, beeping humans out of the way.
So who would you put your money on? Buffett or Ahmadinejad? I’d short Ahmadinejad and go long Warren Buffett.
Why? From outside, Israel looks as if it’s in turmoil, largely because the entire political leadership seems to be under investigation. But Israel is a weak state with a strong civil society. The economy is exploding from the bottom up. Israel’s currency, the shekel, has appreciated nearly 30 percent against the dollar since the start of 2007.
The reason? Israel is a country that is hard-wired to compete in a flat world. It has a population drawn from 100 different countries, speaking 100 different languages, with a business culture that strongly encourages individual imagination and adaptation and where being a nonconformist is the norm. While you were sleeping, Israel has gone from oranges to software, or as they say around here, from Jaffa to Java.
The day I visited the Iscar campus, one of its theaters was filled with industrialists from the Czech Republic, who were getting a lecture — in Czech — from Iscar experts. The Czechs came all the way to the Israel-Lebanon border region to learn about the latest innovations in precision tool-making. Wertheimer is famous for staying close to his customers and the latest technologies. “If you sleep on the floor,” he likes to say, “you never have to worry about falling out of bed.”
That kind of hunger explains why, in the first quarter of 2008, the top four economies after America in attracting venture capital for start-ups were: Europe $1.53 billion, China $719 million, Israel $572 million and India $99 million, according to Dow Jones VentureSource. Israel, with 7 million people, attracted almost as much as China, with 1.3 billion.
Boaz Golany, who heads engineering at the Technion, Israel’s M.I.T., told me: “In the last eight months, we have had delegations from I.B.M., General Motors, Procter & Gamble and Wal-Mart visiting our campus. They are all looking to develop R & D centers in Israel.”
Ahmadinejad professes not to care about such things. He was — to put it in American baseball terms — born on third base and thinks he hit a triple. Because oil prices have gone up to nearly $140 a barrel, he feels relaxed predicting that Israel will disappear, while Iran maintains a welfare state — with more than 10 percent unemployment.
Iran has invented nothing of importance since the Islamic Revolution, which is a shame. Historically, Iranians have been a dynamic and inventive people — one only need look at the richness of Persian civilization to see that. But the Islamic regime there today does not trust its people and will not empower them as individuals.
Of course, oil wealth can buy all the software and nuclear technology you want, or can’t develop yourself. This is not an argument that we shouldn’t worry about Iran. Ahmadinejad should, though.
Iran’s economic and military clout today is largely dependent on extracting oil from the ground. Israel’s economic and military power today is entirely dependent on extracting intelligence from its people. Israel’s economic power is endlessly renewable. Iran’s is a dwindling resource based on fossil fuels made from dead dinosaurs.
So who will be here in 20 years? I’m with Buffett: I’ll bet on the people who bet on their people — not the people who bet on dead dinosaurs.
Visiting Israel sounds cool.
People vs. Dinosaurs By THOMAS L. FRIEDMAN
Tefen Industrial Park, Israel
Question: What do America’s premier investor, Warren Buffett, and Iran’s toxic president, Mahmoud Ahmadinejad, have in common? Answer: They’ve both made a bet about Israel’s future.
Ahmadinejad declared on Monday that Israel “has reached its final phase and will soon be wiped out from the geographic scene.”
By coincidence, I heard the Iranian leader’s statement on Israel Radio just as I was leaving the headquarters of Iscar, Israel’s famous precision tool company, headquartered in the Western Galilee, near the Lebanon border. Iscar is known for many things, most of all for being the first enterprise that Buffett bought overseas for his holding company, Berkshire Hathaway.
Buffett paid $4 billion for 80 percent of Iscar and the deal just happened to close a few days before Hezbollah, a key part of Iran’s holding company, attacked Israel in July 2006, triggering a monthlong war. I asked Iscar’s chairman, Eitan Wertheimer, what was Buffett’s reaction when he found out that he had just paid $4 billion for an Israeli company and a few days later Hezbollah rockets were landing outside its parking lot.
Buffett just brushed it off with a wave, recalled Wertheimer: “He said, ‘I’m not interested in the next quarter. I’m interested in the next 20 years.’ ” Wertheimer repaid that confidence by telling half his employees to stay home during the war and using the other half to keep the factory from not missing a day of work and setting a production record for the month. It helps when many of your “employees” are robots that move around the buildings, beeping humans out of the way.
So who would you put your money on? Buffett or Ahmadinejad? I’d short Ahmadinejad and go long Warren Buffett.
Why? From outside, Israel looks as if it’s in turmoil, largely because the entire political leadership seems to be under investigation. But Israel is a weak state with a strong civil society. The economy is exploding from the bottom up. Israel’s currency, the shekel, has appreciated nearly 30 percent against the dollar since the start of 2007.
The reason? Israel is a country that is hard-wired to compete in a flat world. It has a population drawn from 100 different countries, speaking 100 different languages, with a business culture that strongly encourages individual imagination and adaptation and where being a nonconformist is the norm. While you were sleeping, Israel has gone from oranges to software, or as they say around here, from Jaffa to Java.
The day I visited the Iscar campus, one of its theaters was filled with industrialists from the Czech Republic, who were getting a lecture — in Czech — from Iscar experts. The Czechs came all the way to the Israel-Lebanon border region to learn about the latest innovations in precision tool-making. Wertheimer is famous for staying close to his customers and the latest technologies. “If you sleep on the floor,” he likes to say, “you never have to worry about falling out of bed.”
That kind of hunger explains why, in the first quarter of 2008, the top four economies after America in attracting venture capital for start-ups were: Europe $1.53 billion, China $719 million, Israel $572 million and India $99 million, according to Dow Jones VentureSource. Israel, with 7 million people, attracted almost as much as China, with 1.3 billion.
Boaz Golany, who heads engineering at the Technion, Israel’s M.I.T., told me: “In the last eight months, we have had delegations from I.B.M., General Motors, Procter & Gamble and Wal-Mart visiting our campus. They are all looking to develop R & D centers in Israel.”
Ahmadinejad professes not to care about such things. He was — to put it in American baseball terms — born on third base and thinks he hit a triple. Because oil prices have gone up to nearly $140 a barrel, he feels relaxed predicting that Israel will disappear, while Iran maintains a welfare state — with more than 10 percent unemployment.
Iran has invented nothing of importance since the Islamic Revolution, which is a shame. Historically, Iranians have been a dynamic and inventive people — one only need look at the richness of Persian civilization to see that. But the Islamic regime there today does not trust its people and will not empower them as individuals.
Of course, oil wealth can buy all the software and nuclear technology you want, or can’t develop yourself. This is not an argument that we shouldn’t worry about Iran. Ahmadinejad should, though.
Iran’s economic and military clout today is largely dependent on extracting oil from the ground. Israel’s economic and military power today is entirely dependent on extracting intelligence from its people. Israel’s economic power is endlessly renewable. Iran’s is a dwindling resource based on fossil fuels made from dead dinosaurs.
So who will be here in 20 years? I’m with Buffett: I’ll bet on the people who bet on their people — not the people who bet on dead dinosaurs.
Wednesday, May 07, 2008
Only in America
I don't know what strikes me most in this report from Huffington Post - if it's the American craze about number crunching in elections, or the fact that people would do such a thing as vote for Clinton, being a McCain supporter, just to mess up the Democratic race.
Actually, neither comes as such a surprise to me.
Exit Polls: Limbaugh Effect Seems To Rear Its Head
Did Rush Limbaugh actually impact the Democratic primary?
The loud-mouthed radio talk show host has been encouraging Republicans to vote for Sen. Hillary Clinton to continue the "chaos" in the Democratic race. And a sampling of some key exit poll information suggests he may, to a certain extent, be having an effect.
Thirty-six percent of primary voters said that Clinton does not share their values. And yet, among that total, one out of every five (20 percent) nevertheless voted for her in the Indiana election. Moreover, of the 10 percent of Hoosiers who said "neither candidate" shared their values, 75 percent cast their ballots for Clinton.
These are not small numbers. By comparison, of the 33 percent of voters who said Sen. Barack Obama does not share their values, only seven percent cast their ballots in his favor. Basically, more people who don't relate to Clinton are, for one reason or another, still voting for her. These are not likely to be loyal supporters.
On a broader level, among the 17 percent of primary goers who said they would choose Sen. John McCain over Hillary Clinton in a hypothetical general election match-up, 41 percent of that group came from Clinton's own camp. In essence, roughly seven percent of Clinton support in Indiana (40 percent of 17 percent) said they would defect to the Republican should she end up the nominee. That would be a difficult punch to stomach in November. In 2004, nearly 1 million Indianans voted for John Kerry. A seven percent defection rate would have meant 70,000 less votes.
By contrast, if the general election is between Obama and McCain, 19 percent of the Indiana Democratic primary goers said they would support the Republican. But only 12 percent of that group (2.28 percent) would come from Obama's camp.
The numbers suggest one of three things: A) Clinton's support in Indiana, while clearly there, is not entirely solid; B) a large swath of Indiana primary goers simply didn't like the nominees and thought of Clinton as the lesser of two evils; or C) Limbaugh's hatchet plan could be having political ripples.
Perhaps it's a mix of all three.
Actually, neither comes as such a surprise to me.
Exit Polls: Limbaugh Effect Seems To Rear Its Head
Did Rush Limbaugh actually impact the Democratic primary?
The loud-mouthed radio talk show host has been encouraging Republicans to vote for Sen. Hillary Clinton to continue the "chaos" in the Democratic race. And a sampling of some key exit poll information suggests he may, to a certain extent, be having an effect.
Thirty-six percent of primary voters said that Clinton does not share their values. And yet, among that total, one out of every five (20 percent) nevertheless voted for her in the Indiana election. Moreover, of the 10 percent of Hoosiers who said "neither candidate" shared their values, 75 percent cast their ballots for Clinton.
These are not small numbers. By comparison, of the 33 percent of voters who said Sen. Barack Obama does not share their values, only seven percent cast their ballots in his favor. Basically, more people who don't relate to Clinton are, for one reason or another, still voting for her. These are not likely to be loyal supporters.
On a broader level, among the 17 percent of primary goers who said they would choose Sen. John McCain over Hillary Clinton in a hypothetical general election match-up, 41 percent of that group came from Clinton's own camp. In essence, roughly seven percent of Clinton support in Indiana (40 percent of 17 percent) said they would defect to the Republican should she end up the nominee. That would be a difficult punch to stomach in November. In 2004, nearly 1 million Indianans voted for John Kerry. A seven percent defection rate would have meant 70,000 less votes.
By contrast, if the general election is between Obama and McCain, 19 percent of the Indiana Democratic primary goers said they would support the Republican. But only 12 percent of that group (2.28 percent) would come from Obama's camp.
The numbers suggest one of three things: A) Clinton's support in Indiana, while clearly there, is not entirely solid; B) a large swath of Indiana primary goers simply didn't like the nominees and thought of Clinton as the lesser of two evils; or C) Limbaugh's hatchet plan could be having political ripples.
Perhaps it's a mix of all three.
Monday, May 05, 2008
Orwellian musings
Great text from the very interesting Slate online magazine.
Obama and Orwell
What the master Brit can teach Democrats about elitism.
By Jeff Greenfield
Obama and Orwell
What the master Brit can teach Democrats about elitism.
By Jeff Greenfield
Friday, April 25, 2008
The right biofuel
This op-ed article on yesterday's NY Times is so thoroughly good that I couldn't bring myself to copy-paste quotes of it - all passages are excellent. A must-read.
"Bring On The Right Biofuels" by Roger Cohen
Also excellent, and somewhat related, is this slideshow from the Financial Times on Amazon deforestation.
"Bring On The Right Biofuels" by Roger Cohen
Also excellent, and somewhat related, is this slideshow from the Financial Times on Amazon deforestation.
Monday, April 14, 2008
Food? What food?
Another rich, fact-based discussion from the Guardian. This one has really kept me thinking.
Credit crunch? The real crisis is global hunger. And if you care, eat less meat
A food recession is under way. Biofuels are a crime against humanity, but - take it from a flesh eater - flesh eating is worse
First two comments from readers are great, too. One links to this appaling video about pig-farming. I could not watch until the end (might have puked) and am seriously considering bypassing bacon from now on.
Oh. me, vegan? No way.
Credit crunch? The real crisis is global hunger. And if you care, eat less meat
A food recession is under way. Biofuels are a crime against humanity, but - take it from a flesh eater - flesh eating is worse
First two comments from readers are great, too. One links to this appaling video about pig-farming. I could not watch until the end (might have puked) and am seriously considering bypassing bacon from now on.
Oh. me, vegan? No way.
Tuesday, March 25, 2008
Monster
So far, the best articles I've read on the current financial crisis - trust me, I've read a lot on it recently - were in the New York Times. The attempts to explain the situation "for dummies", without political biases, is remarkable.
The titles are suggestive -
"What created this monster?"
"Can't grasp credit crisis? Join the club"
The titles are suggestive -
"What created this monster?"
"Can't grasp credit crisis? Join the club"
Tuesday, March 18, 2008
It's the economists, stupid
Here is a link to a blunt, in-your-face article by a smart writer, that tries to put into perspective the current economic woes of the US in light of the deregulation of the past 3 decades.
Makes me wonder, for all my belief in free markets and liberalism, whether it can be fully implemented in spite of the natural greed of humankind. Maybe it is a bit like socialism - a good idea from well-meaning people, that History will deem as not practical to implement.
Makes me wonder, for all my belief in free markets and liberalism, whether it can be fully implemented in spite of the natural greed of humankind. Maybe it is a bit like socialism - a good idea from well-meaning people, that History will deem as not practical to implement.
Friday, February 29, 2008
Liberal substance
Right. The democratic primaries are entertaining, so much that everyone (inside and outside America) is siding with either Obama or Hillary, as if THEY were the opposites, as if one would be good and the other one bad. Then there's drama, pub discussions, rallying, you know, the circus that we all need alongside the daily bread.
But - some facts have reminded me that reality is not quite like that.
First: Obama and Hillary are quite similar in terms of policy. Too similar, in fact. Universal or almost universal health care. Pull out of Iraq in an orderly line or in a bang. Reverse Nafta or propose a new Nafta. On and on the list goes, split much more along semantic than ideological lines.
Second: For as much Hillary has been punching Obama, she cannot beat him TOO hard, otherwise she'd give republicans some meat for the REAL contest in the next months. When McCain comes to punch Obama, he's probably going to kick and use a baseball bat as well. This article in the New York Times election blog actually explains it much more clearly than I ever could.
Third: are democrats really the best option now? I mean, for a non-American like myself, should I cheer for the Dems? What would it mean to me if they won?
OK. Within that point: Bush has been terrible in a lot of issues. He and his party definitely represent a portion of American conservatism that thinks backwards and inwards, and which does very little to share with the world the good things of American culture. In fact, it does a lot to share the bad things (pollution, consumerism, xenophobia, ...).
But - what is it that the world needs from America, economically speaking? Is it less pollution? Probably, but not most importantly. Open trade is the correct answer. Every country wants to buy and sell its goods to America, and America should want to buy and sell goods for other countries, in a process that would leave everyone better off. Again, a look at this well-balanced article from the Financial Times explains it better than I would.
The FT also reminds us that both Obama and Hillary have been speaking as if Nafta - arguably the most pro-free-trade action in America in the past 20 years - was bad for America because it made Americans lose jobs. The agreement, in their words, should be overhauled. Which is a starting point not to pursue free trade at all.
Quoting the FT:
Trade policy has no effect on net employment: you can as easily have full employment, or chronic unemployment, under autarky as under free trade. The purpose of liberal trade is not to “create jobs” – the term is a badge of economic illiteracy – but to change the pattern of work and raise living standards overall. As with new technology, there are winners and losers. The right policy is not to turn back integration, any more than it would be to ban the fork-lift truck. It is to ensure that the overall gains are widely shared and the victims get help.
The saddest thing is that the Democrats who understand this reasoning believe that the party’s supporters are too dull to grasp it, and must be fed some protectionist red meat. The challenge, they believe, is to pander to ignorance while doing the least harm.
After this masterclass from an expert, I have nothing to add.
Oh, actually I do. I have always been very positively impressed on how much the Financial Times and The Economist transcend political divides and never - ever - side with political ideologies in their opinions. They are, however, consistent defenders of liberalism. How long will it take for Brazil to have anything like that in the media? Our reporters at times seem most worried in ousting or defending the government, selectively choosing what themes to write, rather than bring out issues whose discussion would improve well-being of the nation.
Not to mention it is tiring to always read both the leftist and the rightist column, because I know that the truth is in neither one. These days, forming an opinion out of Brazilian media sounds like doing a statistical analysis: you collect a massive amount of data, then exclude the outliers, than figure out the mean and standard deviation, perhaps test if it is a normal distribution...
But - some facts have reminded me that reality is not quite like that.
First: Obama and Hillary are quite similar in terms of policy. Too similar, in fact. Universal or almost universal health care. Pull out of Iraq in an orderly line or in a bang. Reverse Nafta or propose a new Nafta. On and on the list goes, split much more along semantic than ideological lines.
Second: For as much Hillary has been punching Obama, she cannot beat him TOO hard, otherwise she'd give republicans some meat for the REAL contest in the next months. When McCain comes to punch Obama, he's probably going to kick and use a baseball bat as well. This article in the New York Times election blog actually explains it much more clearly than I ever could.
Third: are democrats really the best option now? I mean, for a non-American like myself, should I cheer for the Dems? What would it mean to me if they won?
OK. Within that point: Bush has been terrible in a lot of issues. He and his party definitely represent a portion of American conservatism that thinks backwards and inwards, and which does very little to share with the world the good things of American culture. In fact, it does a lot to share the bad things (pollution, consumerism, xenophobia, ...).
But - what is it that the world needs from America, economically speaking? Is it less pollution? Probably, but not most importantly. Open trade is the correct answer. Every country wants to buy and sell its goods to America, and America should want to buy and sell goods for other countries, in a process that would leave everyone better off. Again, a look at this well-balanced article from the Financial Times explains it better than I would.
The FT also reminds us that both Obama and Hillary have been speaking as if Nafta - arguably the most pro-free-trade action in America in the past 20 years - was bad for America because it made Americans lose jobs. The agreement, in their words, should be overhauled. Which is a starting point not to pursue free trade at all.
Quoting the FT:
Trade policy has no effect on net employment: you can as easily have full employment, or chronic unemployment, under autarky as under free trade. The purpose of liberal trade is not to “create jobs” – the term is a badge of economic illiteracy – but to change the pattern of work and raise living standards overall. As with new technology, there are winners and losers. The right policy is not to turn back integration, any more than it would be to ban the fork-lift truck. It is to ensure that the overall gains are widely shared and the victims get help.
The saddest thing is that the Democrats who understand this reasoning believe that the party’s supporters are too dull to grasp it, and must be fed some protectionist red meat. The challenge, they believe, is to pander to ignorance while doing the least harm.
After this masterclass from an expert, I have nothing to add.
Oh, actually I do. I have always been very positively impressed on how much the Financial Times and The Economist transcend political divides and never - ever - side with political ideologies in their opinions. They are, however, consistent defenders of liberalism. How long will it take for Brazil to have anything like that in the media? Our reporters at times seem most worried in ousting or defending the government, selectively choosing what themes to write, rather than bring out issues whose discussion would improve well-being of the nation.
Not to mention it is tiring to always read both the leftist and the rightist column, because I know that the truth is in neither one. These days, forming an opinion out of Brazilian media sounds like doing a statistical analysis: you collect a massive amount of data, then exclude the outliers, than figure out the mean and standard deviation, perhaps test if it is a normal distribution...
Monday, February 25, 2008
He is very, very good.
This American election is getting more interesting every day.
http://www.youtube.com/watch?v=jG0PfADEbDs
Also good reading:
http://www.nytimes.com/2008/02/24/opinion/24rich.html?em&ex=1204088400&en=3e9996b4403c243c&ei=5087%0A
http://www.huffingtonpost.com/arianna-huffington/clinton-obama-and-the-be_b_88349.html
http://www.youtube.com/watch?v=jG0PfADEbDs
Also good reading:
http://www.nytimes.com/2008/02/24/opinion/24rich.html?em&ex=1204088400&en=3e9996b4403c243c&ei=5087%0A
http://www.huffingtonpost.com/arianna-huffington/clinton-obama-and-the-be_b_88349.html
Sunday, January 20, 2008
The Davos question
Following this invitation:
http://www.youtube.com/watch?v=BDqs-OZWw9o
a number of individuals have posted videos on YouTube with questions or answers for issues to be discussed at the World Economic Forum in Davos.
I watched a couple. Very interesting. One of my favorites is
http://www.youtube.com/watch?v=r6U8xUdMMUM
which tackles politics, and how "representative democracy" is a good concept with a flawed execution.
Reminded me of Plato's argumentations.
http://www.youtube.com/watch?v=BDqs-OZWw9o
a number of individuals have posted videos on YouTube with questions or answers for issues to be discussed at the World Economic Forum in Davos.
I watched a couple. Very interesting. One of my favorites is
http://www.youtube.com/watch?v=r6U8xUdMMUM
which tackles politics, and how "representative democracy" is a good concept with a flawed execution.
Reminded me of Plato's argumentations.
Wednesday, January 09, 2008
Glad to be in a positive sum world-economy
In some 30 years from now we might just realize that this has been the best age in History to have lived in. I got that impression from reading this (once again) excellent article from Martin Wolf at the FT.
The dangers of living in a zero-sum world economy
By Martin Wolf
Published: December 18 2007 19:02 | Last updated: December 19 2007 08:05
We live in a positive-sum world economy and have done so for about two centuries. This, I believe, is why democracy has become a political norm, empires have largely vanished, legal slavery and serfdom have disappeared and measures of well-being have risen almost everywhere. What then do I mean by a positive-sum economy? It is one in which everybody can become better off. It is one in which real incomes per head are able to rise indefinitely.
How long might such a world last, and what might happen if it ends? The debate on the connected issues of climate change and energy security raises these absolutely central questions. As I argued in a previous column (“Welcome to a world of runaway energy demand”, November 14, 2007), fossilised sunlight and ideas have been the twin drivers of the world economy. So nothing less is at stake than the world we inhabit, by which I mean its political and economic, as well as physical, nature.
According to Angus Maddison, the economic historian, humanity’s average real income per head has risen 10-fold since 1820.* Increases have also occurred almost everywhere, albeit to hugely divergent extents: US incomes per head have risen 23-fold and those of Africa merely four-fold. Moreover, huge improvements have happened, despite a more than six-fold increase in the world’s population.
It is an astonishing story with hugely desirable consequences. Clever use of commercial energy has immeasurably increased the range of goods and services available. It has also substantially reduced both our own drudgery and our dependence on that of others. Serfs and slaves need no longer satisfy the appetites of narrow elites. Women need no longer devote their lives to the demands of domesticity. Consistent rises in real incomes per head have transformed our economic lives.
What is less widely understood is that they have also transformed politics. A zero-sum economy leads, inevitably, to repression at home and plunder abroad. In traditional agrarian societies the surpluses extracted from the vast majority of peasants supported the relatively luxurious lifestyles of military, bureaucratic and noble elites. The only way to increase the prosperity of an entire people was to steal from another one. Some peoples made almost a business out of such plunder: the Roman republic was one example; the nomads of the Eurasian steppes, who reached their apogee of success under Genghis Khan and his successors, were another. The European conquerors of the 16th to 18th centuries were, arguably, a third. In a world of stagnant living standards the gains of one group came at the expense of equal, if not still bigger, losses for others. This, then, was a world of savage repression and brutal predation.
The move to the positive-sum economy transformed all this fundamentally, albeit far more slowly than it might have done. It just took time for people to realise how much had changed. Democratic politics became increasingly workable because it was feasible for everybody to become steadily better off. People fight to keep what they have more fiercely than to obtain what they do not have. This is the “endowment effect”. So, in the new positive-sum world, elites were willing to tolerate the enfranchisement of the masses. The fact that they no longer depended on forced labour made this shift easier still. Consensual politics, and so democracy, became the political norm.
Equally, a positive-sum global economy ought to end the permanent state of war that characterised the pre-modern world. In such an economy, internal development and external commerce offer better prospects for virtually everybody than does international conflict. While trade always offered the possibility of positive-sum exchange, as Adam Smith argued, the gains were small compared with what is offered today by the combination of peaceful internal development and expanding international trade. Unfortunately, it took almost two centuries after the “industrial revolution” for states to realise that neither war nor empire was a “game” worth playing.
Nuclear weapons and the rise of the developmental state have made war among great powers obsolete. It is no accident then that most of the conflicts on the planet have been civil wars in poor countries that had failed to build the domestic foundations of the positive-sum economy. But China and India have now achieved just that. Perhaps the most important single fact about the world we live in is that the leaderships of these two countries have staked their political legitimacy on domestic economic development and peaceful international commerce.
The age of the plunderer is past. Or is it? The biggest point about debates on climate change and energy supply is that they bring back the question of limits. If, for example, the entire planet emitted CO2 at the rate the US does today, global emissions would be almost five times greater. The same, roughly speaking, is true of energy use per head. This is why climate change and energy security are such geopolitically significant issues. For if there are limits to emissions, there may also be limits to growth. But if there are indeed limits to growth, the political underpinnings of our world fall apart. Intense distributional conflicts must then re-emerge – indeed, they are already emerging – within and among countries.
The response of many, notably environmentalists and people with socialist leanings, is to welcome such conflicts. These, they believe, are the birth-pangs of a just global society. I strongly disagree. It is far more likely to be a step towards a world characterised by catastrophic conflict and brutal repression. This is why I sympathise with the hostile response of classical liberals and libertarians to the very notion of such limits, since they view them as the death-knell of any hopes for domestic freedom and peaceful foreign relations.
The optimists believe that economic growth can and will continue. The pessimists believe either that it will not do so or that it must not if we are to avoid the destruction of the environment. I think we have to try to marry what makes sense in these opposing visions. It is vital for hopes of peace and freedom that we sustain the positive-sum world economy. But it is no less vital to tackle the environmental and resource challenges the economy has thrown up. This is going to be hard. The condition for success is successful investment in human ingenuity. Without it, dark days will come. That has never been truer than it is today.
The dangers of living in a zero-sum world economy
By Martin Wolf
Published: December 18 2007 19:02 | Last updated: December 19 2007 08:05
We live in a positive-sum world economy and have done so for about two centuries. This, I believe, is why democracy has become a political norm, empires have largely vanished, legal slavery and serfdom have disappeared and measures of well-being have risen almost everywhere. What then do I mean by a positive-sum economy? It is one in which everybody can become better off. It is one in which real incomes per head are able to rise indefinitely.
How long might such a world last, and what might happen if it ends? The debate on the connected issues of climate change and energy security raises these absolutely central questions. As I argued in a previous column (“Welcome to a world of runaway energy demand”, November 14, 2007), fossilised sunlight and ideas have been the twin drivers of the world economy. So nothing less is at stake than the world we inhabit, by which I mean its political and economic, as well as physical, nature.
According to Angus Maddison, the economic historian, humanity’s average real income per head has risen 10-fold since 1820.* Increases have also occurred almost everywhere, albeit to hugely divergent extents: US incomes per head have risen 23-fold and those of Africa merely four-fold. Moreover, huge improvements have happened, despite a more than six-fold increase in the world’s population.
It is an astonishing story with hugely desirable consequences. Clever use of commercial energy has immeasurably increased the range of goods and services available. It has also substantially reduced both our own drudgery and our dependence on that of others. Serfs and slaves need no longer satisfy the appetites of narrow elites. Women need no longer devote their lives to the demands of domesticity. Consistent rises in real incomes per head have transformed our economic lives.
What is less widely understood is that they have also transformed politics. A zero-sum economy leads, inevitably, to repression at home and plunder abroad. In traditional agrarian societies the surpluses extracted from the vast majority of peasants supported the relatively luxurious lifestyles of military, bureaucratic and noble elites. The only way to increase the prosperity of an entire people was to steal from another one. Some peoples made almost a business out of such plunder: the Roman republic was one example; the nomads of the Eurasian steppes, who reached their apogee of success under Genghis Khan and his successors, were another. The European conquerors of the 16th to 18th centuries were, arguably, a third. In a world of stagnant living standards the gains of one group came at the expense of equal, if not still bigger, losses for others. This, then, was a world of savage repression and brutal predation.
The move to the positive-sum economy transformed all this fundamentally, albeit far more slowly than it might have done. It just took time for people to realise how much had changed. Democratic politics became increasingly workable because it was feasible for everybody to become steadily better off. People fight to keep what they have more fiercely than to obtain what they do not have. This is the “endowment effect”. So, in the new positive-sum world, elites were willing to tolerate the enfranchisement of the masses. The fact that they no longer depended on forced labour made this shift easier still. Consensual politics, and so democracy, became the political norm.
Equally, a positive-sum global economy ought to end the permanent state of war that characterised the pre-modern world. In such an economy, internal development and external commerce offer better prospects for virtually everybody than does international conflict. While trade always offered the possibility of positive-sum exchange, as Adam Smith argued, the gains were small compared with what is offered today by the combination of peaceful internal development and expanding international trade. Unfortunately, it took almost two centuries after the “industrial revolution” for states to realise that neither war nor empire was a “game” worth playing.
Nuclear weapons and the rise of the developmental state have made war among great powers obsolete. It is no accident then that most of the conflicts on the planet have been civil wars in poor countries that had failed to build the domestic foundations of the positive-sum economy. But China and India have now achieved just that. Perhaps the most important single fact about the world we live in is that the leaderships of these two countries have staked their political legitimacy on domestic economic development and peaceful international commerce.
The age of the plunderer is past. Or is it? The biggest point about debates on climate change and energy supply is that they bring back the question of limits. If, for example, the entire planet emitted CO2 at the rate the US does today, global emissions would be almost five times greater. The same, roughly speaking, is true of energy use per head. This is why climate change and energy security are such geopolitically significant issues. For if there are limits to emissions, there may also be limits to growth. But if there are indeed limits to growth, the political underpinnings of our world fall apart. Intense distributional conflicts must then re-emerge – indeed, they are already emerging – within and among countries.
The response of many, notably environmentalists and people with socialist leanings, is to welcome such conflicts. These, they believe, are the birth-pangs of a just global society. I strongly disagree. It is far more likely to be a step towards a world characterised by catastrophic conflict and brutal repression. This is why I sympathise with the hostile response of classical liberals and libertarians to the very notion of such limits, since they view them as the death-knell of any hopes for domestic freedom and peaceful foreign relations.
The optimists believe that economic growth can and will continue. The pessimists believe either that it will not do so or that it must not if we are to avoid the destruction of the environment. I think we have to try to marry what makes sense in these opposing visions. It is vital for hopes of peace and freedom that we sustain the positive-sum world economy. But it is no less vital to tackle the environmental and resource challenges the economy has thrown up. This is going to be hard. The condition for success is successful investment in human ingenuity. Without it, dark days will come. That has never been truer than it is today.
Wednesday, December 05, 2007
On climate change
Here are excerpts of an excelent article from the always excellent Martin Wolf at the Financial Times, which I take the liberty of publishing here.
I am sure Mr Wolf will not mind this minor copyright infringement when it spreads out further the message he's putting forward.
Why the climate change wolf is so hard to kill off
By Martin Wolf
FT, December 4th, 2007
The point of the story of the boy who cried wolf is that, finally, a wolf did appear. I feel the same way about the intellectual heirs of Thomas Malthus. Malthusians have finally found a wolf called climate change. Many now agree. But it is far away and coming slowly. “If the worst comes to the worst,” mutter the rich to themselves, “we can always let our children cope.”
This is the complacency that the latest Human Development Report from the United Nations Development Programme attacks. It does a good job, too. But does it do a good enough job to turn the Bali climate change conference into a call for effective action? I fear not. This is not because it fails to make a morally sound case. It is rather because humanity will change its behaviour only when convinced that the lifestyle the better off enjoy now – and the rest of the world aspires to – remains in reach.
(...)
(...)
Can the world do better in future? Yes, but it will find it hard. If we are to understand why, we must confront the fact that the world is far from a single country. This creates three huge problems: collective (in)action; perceived injustice; and indifference.
First, not only does each country want to be a free rider on the efforts of others but none feels wholly responsible for the outcome.
Second, the contributions made by different countries to the problem have been (and remain) enormously different. Collectively, the rich countries account for seven out of every 10 tonnes of CO2 emitted since the start of the industrial era. While China is the biggest emitter in the world, its emissions are still only one-fifth of US levels per head. India’s are one-fifteenth.
Third, as the report spells out in compelling detail, the heaviest cost will be borne by the world’s poor. Among the most frightening consequences are those for rainfall and glaciers: water shortages could become severe across large swaths of the globe. Poor people are far less able to cope with climatic disasters than rich ones. But this, if we were honest, is why the rich are unlikely to make the huge reductions in emissions the report demands. The powerful will continue to act without much consideration for the poor. This, after all, is a world that spends 10 times as much on defence (much of it useless) as on aid to poor countries.
(...)
How might this change? The answer is that we must appeal at least as much to people’s self-interest as to their morality.
(...)
Two things are needed. The first is convincing evidence that the true risks are larger than many now suppose. Conceivable feedback effects might, for example, generate temperature increases of 20°C. That would be the end of the world as we know it. I cannot imagine a rational person who would not seek to eliminate even the possibility of such outcomes. But if we are to do that, we must also act very soon.
The second requirement is to demonstrate that it is possible for us to thrive with low-carbon emissions. People in the northern hemisphere are not going to choose to be cold now, in order to prevent the world from becoming far too hot in future. China and India are not going to forgo development, either. These are realities that cannot be ignored.
(...)
In short, if they are to tolerate radical change in energy use, people must first be frightened and then they must be offered a good way out. The truth, moreover, is that this will happen only if the US also takes the lead. No country will deliver radical cuts if the US does not do so, too. No leaps forward in science and technology will occur if the US is not prepared to commit its resources to those ends. The US can no longer wait for a lead from others. Either it takes the lead now or the cause, in all probability, will be lost. Our children and grandchildren will then find out whether it was a real wolf or not.
I am sure Mr Wolf will not mind this minor copyright infringement when it spreads out further the message he's putting forward.
Why the climate change wolf is so hard to kill off
By Martin Wolf
FT, December 4th, 2007
The point of the story of the boy who cried wolf is that, finally, a wolf did appear. I feel the same way about the intellectual heirs of Thomas Malthus. Malthusians have finally found a wolf called climate change. Many now agree. But it is far away and coming slowly. “If the worst comes to the worst,” mutter the rich to themselves, “we can always let our children cope.”
This is the complacency that the latest Human Development Report from the United Nations Development Programme attacks. It does a good job, too. But does it do a good enough job to turn the Bali climate change conference into a call for effective action? I fear not. This is not because it fails to make a morally sound case. It is rather because humanity will change its behaviour only when convinced that the lifestyle the better off enjoy now – and the rest of the world aspires to – remains in reach.
(...)
(...)
Can the world do better in future? Yes, but it will find it hard. If we are to understand why, we must confront the fact that the world is far from a single country. This creates three huge problems: collective (in)action; perceived injustice; and indifference.
First, not only does each country want to be a free rider on the efforts of others but none feels wholly responsible for the outcome.
Second, the contributions made by different countries to the problem have been (and remain) enormously different. Collectively, the rich countries account for seven out of every 10 tonnes of CO2 emitted since the start of the industrial era. While China is the biggest emitter in the world, its emissions are still only one-fifth of US levels per head. India’s are one-fifteenth.
Third, as the report spells out in compelling detail, the heaviest cost will be borne by the world’s poor. Among the most frightening consequences are those for rainfall and glaciers: water shortages could become severe across large swaths of the globe. Poor people are far less able to cope with climatic disasters than rich ones. But this, if we were honest, is why the rich are unlikely to make the huge reductions in emissions the report demands. The powerful will continue to act without much consideration for the poor. This, after all, is a world that spends 10 times as much on defence (much of it useless) as on aid to poor countries.
(...)
How might this change? The answer is that we must appeal at least as much to people’s self-interest as to their morality.
(...)
Two things are needed. The first is convincing evidence that the true risks are larger than many now suppose. Conceivable feedback effects might, for example, generate temperature increases of 20°C. That would be the end of the world as we know it. I cannot imagine a rational person who would not seek to eliminate even the possibility of such outcomes. But if we are to do that, we must also act very soon.
The second requirement is to demonstrate that it is possible for us to thrive with low-carbon emissions. People in the northern hemisphere are not going to choose to be cold now, in order to prevent the world from becoming far too hot in future. China and India are not going to forgo development, either. These are realities that cannot be ignored.
(...)
In short, if they are to tolerate radical change in energy use, people must first be frightened and then they must be offered a good way out. The truth, moreover, is that this will happen only if the US also takes the lead. No country will deliver radical cuts if the US does not do so, too. No leaps forward in science and technology will occur if the US is not prepared to commit its resources to those ends. The US can no longer wait for a lead from others. Either it takes the lead now or the cause, in all probability, will be lost. Our children and grandchildren will then find out whether it was a real wolf or not.
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