ROW: Links for 10th July, 2019

  1. “The radio station, whose call letters are KHIL, has long been the daily soundtrack for this frontier town (population 3,500) that prides itself on its cowboy culture and quiet pace of life. But six decades after the founding of the station, the property is in foreclosure, with utility disconnect notices coming nearly every month.”
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    Culture and Coase (an updated version) in rural America. For both of these reasons and more, worth your time.
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  2. “When Amnesty International U.S.A. started looking for a new headquarters in New York City, the human rights group settled on office space in a modest skyscraper in Lower Manhattan known as Wall Street Plaza.But just as the organization was about to sign a lease last week, the building’s owner said that its new parent company, a giant shipping conglomerate owned by the Chinese government, decided to veto the offer. The company, Cosco Shipping, did not want the United States chapter of Amnesty International, which has produced scathing reports highlighting human rights abuses in China, as a tenant, according to the group.”
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    Business, culture, nationalism, America and China.
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  3. “When you’re doing everything wrong, the best way to fix the problem isn’t usually to go through the list of things you’re doing wrong and fix them one by one. It’s best to step back and ask why you’re so bad at everything, whether a systemic problem is causing you to make so many separate mistakes. And in the case of the MTA, the root cause of its capital-construction failures is usually diagnosed as unaccountability: Nobody knows who’s in charge, so nobody has to be terrified of taking the blame for obscene costs and endless delays.”
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    Coordinating stuff is hard. The New York version of this story. Also, this is why Singapore deserves all the admiration it gets (and more)
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  4. “During the French referendum on the Treaty of Maastricht in 1992, we observed that 60% of the voters with the lowest incomes, personal wealth or qualifications voted against, whereas the 40% of the electorate with higher incomes voted in favour; the gap was big enough for the yes vote to win with a small majority (51%). The same thing happened with the Constitutional Treaty in 2005, except that this time only the top 20% were in favour of the yes vote, whereas the lower 80% preferred to vote no, whence a clear victory for the latter (55%). Likewise for the referendum on Brexit in the UK in 2016: this time it was the top 30% who voted enthusiastically to remain in the EU. But, as the bottom 70% preferred to leave, the leave vote won with 52% of the votes.”
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    An article which helps you think a little bit more about the European Union and what plagues it.
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  5. “China’s overall external surplus is down. That’s not surprising—China’s general government deficit is somewhere between 4 percent of GDP and 12 percent of GDP, depending on what measure you use. The gap between China’s fiscal stance and that of Korea is even bigger than the gulf between Germany’s surplus and the deficit of France—and the gap between the euro area’s (tight) overall fiscal stance and the much looser stance of the United States.But the surplus of China’s neighbors, who have responded, in many cases, to the “rise” of China with policy stances designed to maintain weak currencies and protect their exports, has soared over the past ten years, and now is substantially larger than it was prior to the global crisis.”
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    A useful article about Korea’s macroeconomic choices, and the reasoning behind them.
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RoW: Links for 3rd July, 2019

 

Five articles to help you understand China today a little bit better (well, one is on North Korea, axshually)

  1. “There is truth in this linguistic yarn; Chinese does deserve its reputation for heartbreaking difficulty. Those who undertake to study the language for any other reason than the sheer joy of it will always be frustrated by the abysmal ratio of effort to effect. Those who are actually attracted to the language precisely because of its daunting complexity and difficulty will never be disappointed. Whatever the reason they started, every single person who has undertaken to study Chinese sooner or later asks themselves “Why in the world am I doing this?” Those who can still remember their original goals will wisely abandon the attempt then and there, since nothing could be worth all that tedious struggle. Those who merely say “I’ve come this far — I can’t stop now” will have some chance of succeeding, since they have the kind of mindless doggedness and lack of sensible overall perspective that it takes.”
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    A long, but fun read on how and why Chinese (both kinds) is so difficult to learn – and do think about what this might tell us about China.
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  2. “But that is the wrong way to approach the challenge. In the near term (1-4 years), the US certainly could inflict a lot of damage on China through tariffs, bans on technology purchases, and other trade-war policies. But it would also inflict a lot of damage on itself; and in the end, the Chinese would suffer less. Whereas the Chinese government can buy up Chinese-made products that previously would have been sold to the US, thereby preventing mass unemployment and social turmoil, the US government could scarcely do the same for American workers displaced by the loss of the Chinese market.”
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    Brad DeLong argues against the anti-China line that almost everyone in America seems to toe to these days (Biden almost excepted)
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  3. “Total food production figures, however, are not the end of the story. The important question is who gets access to food, rather than just how much is harvested. Theoretically, North Korea could produce 10 million tons of food, but if all of it ends up in Pyongyang, there would still be massive shortages in the countryside. Here is where markets matter. The WFP assessments are based on the assumption that most food consumed in North Korea is still handed out by the government through the public distribution system (PDS); they do not take account of the role of markets in the food distribution system.”
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    38North on how bad the food situation is in North Korea. Markets matter!
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  4. “This is a useful reminder that decentralization is not an immutable feature of the Chinese system, or something that happened automatically just because China is a very large country. Clearly Gu saw that in the 1970s the Chinese system was too centralized to be efficient, and that it needed to be more decentralized. (Jae-Ho Chung’s book Centrifugal Empire: Central-Local Relations in China also argues that the Maoist emphasis on local autonomy in the 1970s was largely rhetorical, with most localities compelled to follow the same political campaigns and economic priorities.)”
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    For a variety of reasons, decentralization really matters – here’s how China learnt this lesson.
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  5. “At the heart of China’s Going Out policy is a media offensive launched in March 2018, an initiative coordinated by the broadcast group Voice of China and carefully monitored by Communist Party censors. In addition, the state-run news agency Xinhua was expanded and now claims to be the largest news wire in the world.”
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    A fascinating read on how China is reshaping the media narrative in Africa.

RoW: Links for 26th June, 2019

Articles from the Far East in today’s edition:

 

  1. “Thus is revealed a deeper lesson still: Freedom is not merely the ability to buy and sell goods at minimum regulation and a low tax rate, variables that are readily picked up by economic freedom indices. Freedom is also about the narratives people live by and the kind of future they imagine for themselves. Both of these are greatly affected by the legitimacy and durability of their political institutions.”
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    There’s lessons to be learned for all nations from what is going on in Hong Kong today, and Tyler Cowen ably lays out a map. In short, political institutions really matter – and that is a truly important lesson for anybody who wishes to learn economics.
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  2. “There were three such commitments: “to establish new U.S.–DPRK relations,” “to build a lasting and stable peace regime on the Korean Peninsula,” and “to work toward complete denuclearization of the Korean Peninsula.” The North also pledged to unearth the remains of Americans missing in action, which could help put the Korean War to rest—and not just for those most intimately affected.”
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    From about two weeks ago, but worth reading to get a sense of where North Korea and America are today, relative to where they thought they would be.
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  3. “At 12:42 a.m. on the quiet, moonlit night of March 8, 2014, a Boeing 777-200ER operated by Malaysia Airlines took off from Kuala Lumpur and turned toward Beijing, climbing to its assigned cruising altitude of 35,000 feet. The designator for Malaysia Airlines is MH. The flight number was 370. ”
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    This came out about a week ago, and if you are at all on social media, you’ve probably read it already, but on the off chance that you haven’t: a haunting coda to the sorry saga that is MH370.
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  4. “Beijing’s increasing heavy-handedness is more a symptom of fear than strength. It is borne in part from anxiety about the global trend of power diffusing from governments to non-state actors, a development that runs against the Communist Party’s desire to keep a tight grip on society. It also arises out of the Communist Party’s deep-seated concern that its legitimacy will come under scrutiny, particularly as economic growth continues to decelerate. Beijing’s endemic challenges in enforcing discipline within the Communist Party, particularly as it relates to corruption, also arouses anxieties. So, too, does latent admiration within Chinese society for values that America has sought to advance, even as popular views of the United States government come under fresh scrutiny.”
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    An interesting take on how to view Chinese culture, American culture, and how they evolve in response to each other, and each other’s forms of government.
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  5. “I was given time to try and log in again the next day after my penalty had been served.When I did I had to push “agree and unblock” under the stated reason of “spread malicious rumours”.
    So this rumour-monger clicked on “agree”.
    Then came a stage I was not prepared for. “Faceprint is required for security purposes,” it said.
    I was instructed to hold my phone up – to “face front camera straight on” – looking directly at the image of a human head. Then told to “Read numbers aloud in Mandarin Chinese”.”
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    The surveillance state in China, it’s capabilities, and it’s potential threats. All on China’s most popular app.

ROW: Links for 19th June, 2019

This week, here’s a selection of five articles that help you understand issues in America a little bit better.

 

  1. “The old consensus that the US needed to help address the “root causes” of migration, by investing in the Northern Triangle countries and making it more appealing for people to stay, was never supposed to be an immediate solution to anything. Of course, Trump’s view of migration makes it less likely that anyone will be able to start work on long-term solutions that might bear fruit down the road. It is almost certainly, in the meantime, going to get worse before it gets better.”
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    Vox gives us a clearer picture on the migration crisis at the southern US border. Yes it is bad, yes, there is a crisis, and yes, it likely will get much worse before it gets a little better, for a variety of reasons. All of which are explained in this piece.
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  2. “Of course, if it hadn’t been for Roe, there also wouldn’t have been more than 50 million abortions since 1973; whether that’s a good or bad thing will be left as an exercise for the reader. But many abortions would have been performed anyway, because before the court took the issue away from voters, polls showed public opinion steadily trending in favor of legalized abortion, and the procedure was already legal in several states.”
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    Are you familiar with Roe v Wade? If you aren’t, read up about it first. Then read up about what Alabama is up to today. And finally read this article. And also consider following Megan McArdle (the author of this piece)
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  3. “Rather, regardless of what any deal achieves, the two nations appear to have entered a protracted era of competing for technological advantage, in areas ranging from aerospace and telecommunications to artificial intelligence, all with big military as well as commercial implications. Managing tensions over the issue is an increasingly important part of the U.S.-China relationship, for both sides.”
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    The Christian Science Monitor on what the trade war, or the new cold war (or whatever else it is that you want to call it) really is all about.
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  4. “This resonates with my own view. A large, established enterprise can be thought of as a cultural institution, with particular rules, norms, systems, processes, and institutional knowledge ingrained throughout the firm. In a stable environment, this corporate culture is a valuable asset. But as the business environment evolves, a firm’s culture can inhibit its ability to adapt. Cultural assets can depreciate, and one of the most difficult tasks for top management is to know when and how to replace elements of a culture that otherwise had served to keep the enterprise sturdy and reliable.”
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    Arnold Kling reviews a book that has appeared on these pages before, but the reason I put this article up here is because it helps you understand an important point about America today: it’s reviling of the corporate culture is very real – and Tyler Cowen says perhaps misplaced. Useful to think about how one should think about what made America great, and how perhaps it is changing – for the better or otherwise is your opinion entirely.
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  5. “Before I left, I asked the black waiter, Darick Thomas, how he felt about my hat. “I don’t care. At all. Really. At all! I look at a hat and that doesn’t tell me who the person is,” he said. “I’m not against Trump. He says some smart things; he says some dumb things.” Darick didn’t vote. “Voting is the illusion of choice for the masses,” he explained.”
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    What happens if you were a MAGA hat in a famously liberal restaurant in LA? This is, of course, at best an anecdote – but an enjoyable one, nonetheless.

ROW: Links for 12th June, 2019

  1. “Readers will by now be familiar with the list of industries impacted by the US China trade war. These include soyabeans, cars, steel, and semiconductors.But one commodity is increasingly important to how the tensions play out: students. The Chinese state media is now saying the government will issue a warning on the risk of studying in the US”
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    The FT reports on how Chinese students will now be discouraged from going to American Universities – in a sense, an expected move, but you would be surprised at just how dependent universities in America today are on foreign students. Interesting times.
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  2. “To summarize, based on the above I doubt that actual Chinese growth is more than 1% below the reported figures, at least up through 2018. Of course it’s possible that things have changed in 2019; if so I expect that to show up in upcoming airline travel data for China.”
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    Scott Sumner patiently reminds us that we should look at the data before making a claim, and having looked at the airline data, he rejects the notion that there is a dramatic slowdown in China. The truth, as usual, lies somewhere in the middle.
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  3. “Vietnam, like China really doesn’t import very many manufactures from the United States. That’s partially a function of the fact that the value added in Vietnam is often low, and thus Vietnam cannot afford a lot of top of the line U.S. capital goods (yet). But it is also a function of the fact that many of the global value chains that generate large (often offshore) profits for U.S. firms don’t give rise to that much U.S. production these days. There just isn’t much sign that the Asian value chains stretch back to include U.S. factories and workers. Fabless semiconductor firms that design chips likely export their designs to a low tax jurisdiction before they license their designs to an Asian contract manufacturer. The rise in Vietnam’s exports hasn’t been associated with a commensurate rise in exports from the United States to Vietnam.”
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    Brad Setser takes a look at whether Vietnam is the new China, and concludes that it kind of is, and kind of isn’t.
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  4. “It is not surprising that the CPC has worked so hard to extirpate the Tiananmen Square massacre from public memory. History – including the horrors of Mao Zedong’s rule – is too volatile a substance for the Chinese dictatorship. China’s leaders hold up their system of government as a model for other countries. But how can a regime be confident in the sustainability of its values and methods if it is afraid of its own past?”
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    Chris Patten (who knows a thing or two about this issue) reviews the Tiananmen square massacre, and ponders on what it means for China and Hong Kong today.
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  5. “Despite a small increase in young and female lawmakers—like Ms Suematsu, who is in her forties—local politics is still dominated by old men. “In these municipalities, candidates are so old they have a hard time putting up election posters,” says Shigeki Uno of the Nippon Institute for Research Advancement, another think-tank. Indeed, three-quarters of town and village assembly members are over 60. The oldest, aged 91, holds a seat on a city assembly in Shizuoka, in central Japan.Young people are loth to stand because local politics is not a financially rewarding profession. The law bans assembly members from holding other jobs concurrently. Their pay averages around ¥300,000 ($2,740) a month, hardly enough to support young families. “It’s basically a job for the retired,” sniffs Mr Uno. And for little pay, the workload is onerous.”
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    The Economist reports on Japan, and it’s ageing population – and what that means for democracy on the ground, at local elections.