Monthly Archives: June 2005

Sen. Durbin, a democrat from Illinois, made a moving, patriotic statement in the Senate (full statement as pdf) criticising the treatment of prisoners innnnn Guantanamo Bay.

The issue is not about closing Guantanamo Bay. It is not a question of the address of these prisoners. It is a question of how we treat these prisoners. To close down Guantanamo and ship these prisoners off to undisclosed locations in other countries, beyond the reach of publicity, beyond the reach of any surveillance, is to give up on the most basic and fundamental commitment to justice and fairness, a commitment we made when we signed the Geneva Convention and said the United States accepts it as the law of the land, a commitment which we have made over and over again when it comes to the issue of torture. To criticize the rest of the world for using torture and to turn a blind eye to what we are doing in this war is wrong, and it is not American.

Read The Left Coaster for more about the furore this has caused.

Michael Dell says he would license Unix-based OS X from Apple for Dell computers, if Apple were interested. (Apple has announced that it is moving over to Intel chips.) If I were Microsoft, I would be quite alarmed by this prospect.

The Overseas Development Institute has set up a blog on 2005. They are independent, well-informed and always interesting.

The Michael Jackson trial has reminded me that: a. Juries can make remarkably sensible decisions. As is clear from the post-trial interviews, several jurors thought it quite likely that Jackson had behaved inappropriately with his house-guests, but that the prosecution had not proven the case. This shows that the jury understood its responsibility and took it seriously. b. There is an important distinction, which our media ignore, between "the public interest" and "things the public is interested in". While the public is clearly fascinated by Michael Jackson, this is essentially a private matter between him and the family of the boy he was accused of molesting. It is completely inappropriate for this to be front page news and to lead the TV news. c. There is no good reason for the UK’s absurd rules that prevent jurors from explaining after a trial why they decided as they did. American justice has been enhanced, not degraded, by the jurors’ willingness to explain their decision in this case.

Thabo Mbeki has sacked his Deputy President, the popular Jacob Zuma, over allegations of corruption. This is exactly the sort of firm leadership, and intolerance of corruption, that the new generation of African leaders are advocating. I hope he will get the international recognition that he deserves. In the meantime, the UK has suspended a substantial part of its aid to Ethiopia after 36 people died in election protests. I commented on 10 June on the difficulty of making judgements about when aid should be withheld because governments can no longer be regarded as good partners in development. I hope these events will be noticed and commented on by the anti-aid brigade, who complain about poor governance in Africa, and who perpetuate fears that aid will be channelled to Governments with a poor record on governance. As these examples show, governance is improving, and aid is not provided without regard to the behaviour of the recipients.

So, Sir Gus O’Donnell is to be the new Cabinet Secretary. So much for the fiction that the civil service wants to recognise and promote civil servants who "deliver" public services. Gus is a great guy, and is no doubt a good policy adviser. But he has never delivered a public service – except advice – in his entire life. As ever, the rhetoric about what sort of skills we will value in the civil service is somewhat different from the reality.

legal guide for bloggersThe Electronic Frontier Foundation (EFF) has released a guide for bloggers about their legal rights in the United States, including libel law, election law, privacy, labour law and copyright law. This BBC guide to defamation and libel is useful for UK bloggers.      

Next door to us at the Center for Global Development is our sister institution, the Institute for International Economics. Gary Clyde Hufbauer and Paul L. E. Grieco have published some very interesting analysis which finds that:

Using four different methods, we estimate that the combination of shrinking distances … and lower political barriers to international trade and investment have generated an increase in U.S. income of roughly $1 trillion a year (measured in 2003 dollars), or about 10 percent of gross domestic product. This translates to a gain in annual income of about $10,000 per household.

These benefits are much larger than the losses faced by people who work in the industries that would be adversely affected:

we estimate that the lifetime costs of a year’s worth of trade-related job losses is roughly $54 billion, about $240,000 per affected worker. This is a huge loss on a personal level, but only about 5 percent of the annual national gains from liberalization. Moreover, a rough estimate of the adjustment costs to agricultural landowners suggests that the progressive removal of trade barriers and farm subsidies over a decade could lower agricultural land values by $27 billion a year … lower property values are a one-time private loss and a fraction of national gains.

This provides useful quantitative estimates which back up my view on the benefits of globalization:

  • there is no question that the world as a whole is better off with free trade – the gains far outweigh the losses
  • but the distribution of those gains will depend on how the liberalisation is managed
  • if we want to acclerate trade liberalisation – and so reap those benefits sooner – we should be more creative about redistributing the benefits to compensate the losers. These gains are so large that, even if we provide generous benefits to the losers, we are still better off as a whole.
  • we should use the benefits of global trade liberalisation to offset short term losses in developing countries – both to ensure that the poor get a large proportion of the benefits of trade liberalisation, and to ensure that the impact on poor countries does not become an obstacle to further trade liberalisation

The welcome announcement this weekend of one hundred percent debt relief for Heavily Indebted Poor Countries (HIPC) has prompted some discussion of whether we need arrangements to prevent the accumulation of debt in future. Debt relief skews development assistance away from priorities by shifting resources to countries that have been managed badly (and hence run up unafordable debts); and countries may find that benefiting from debt relief today makes it more difficult for them to get credit at affordable rates in the future. Furthermore, achieving full debt relief where it is both necessary and fair has taken a very long time, during which millions of dollars have been paid by poor countries to the rich. Today’s Guardian suggested this:

Surely, rather than rich nations sitting as judge and jury on the debts of the poor, it should be possible to establish an independent arbitration system to stop this situation ever developing again.

The establishment of an arbitration committee to regulate who can borrow does not sound practical or desirable. Here is another possible solution, focused on the particular problem of debts incurred by illegitimate and corrupt governments (often called "odious debts") – such as those accumulated by the apartheid government, or by the Government of Mobuto Sese Seko of Zaire. An institition would be nominated (perhaps the Security Council) which has the power to designate particular regimes as "odious". Countries such as the UK and US would change their laws to prevent the legal enforcement of any sovereign debts of those countries, for debts incurred after the regime was declared to be odious. Lenders would know that any loans to odious regimes could not be enforced or collected, and so lending would largely dry up. Such a mechanism (which has been proposed by economists Michael Kremer and Seema Jayachandran) would shut down access to credit for corrupt regimes (unlike trade or financial sanctions, it would be self-enforcing); and it would prevent the accumulation of debts by corrupt countries that might have to be forgiven in the future, with the consequential damage to credit worthiness of the government and skewing of aid resources.

Peter MandelsonThe EU has reached an agreement with China under which China will restrain its exports of textiles and clothes into the EU until the end of 2008. The negotiators – EU Trade Commissioner Peter Mandelson and Chinese Commerce Minister Bo Xilai – are are very pleased with themselves for averting a trade dispute. They should be ashamed of themselves. This is an agreement that does not benefit the EU, whose consumers will be denied access to cheaper clothing, nor the China whose producers will be prevented from selling their products to people who want to buy them. The problem, as ever, is that the garment industry in Europe is more vocal and better organised, and so carries more political weight, than the more diffuse group of consumers who benefit from opening up trade. So special pleading by a minority overrides the interests of the rest of us. More than half the Chinese population lives on less than $2 per day; and a large proportion of the world’s poor are Chinese. Unlike Africa, it seems likely that China will develop over the coming decades into an economic powerhouse (incidentally, disproving the argument that democracy and free speech are essential prerequisites to economic development; but that is a subject for another day). While there are so many poor people in China, it is an outrage to deny them the opportunity to trade their way out of poverty by selling into EU and US markets. The US and EU limites will cost the Chinese textile industry more than $3 billion a year, and adversely affect up to half a million workers. So we have a policy agreement which is in almost nobody’s interests – not the poor of China, seeking to export and growt their way out of poverty, and not the people of Europe (or not the people in Europe who wear clothes). The interests of those people are being put behind the small number of people in Europe whose livelihoods will be adversely affected by having to compete with imports from China. On what authority did Peter Mandelson sign up to this agreement on our behalf? As Tony Benn likes to ask:

What power have you got? Where did you get it from? In whose interests do you exercise it? To whom are you accountable? How do we get rid of you?

You can read more about the deal here. (Actually, I quite like Peter Mandelson, though I am no great fan of the New Labour project. I think he was unfairly treated when he was forced to resign from the Government, even though there was no evidence he had done anything wrong. But I think this agreement is a triumph of style over substance.)

The news today is that a deal has been reached on 100% multilateral debt relief. (There has been consensus for some time on this objective; the difficulty has been reaching an agreement on whether and how the multilateral institutions would be replenished for the cost of the relief). If so, then we should give credit to George Bush for shifting his Government’s policy; and to Tony Blair who visited the US last week to argue for the US to do more Africa, which seems to have contribute to this progress. The progress towards debt relief, more aid, and a stepping up the fight against infectious diseases is very welcome. However, it seems that relatively little progress is being made towards a package of trade access measures for developing countries – it seems that many G8 countries are procrastinating, trying to push this off to the WTO negotiations. As we welcome progress on debt relief, we should not lose sight of the enormous importance of trade liberalisation for the prosperity of developing countries – probably even more important, in the long run, than increased aid.

David Brooks has this uplifting article in the New York Times (free registration required) about the impact of access to AIDS drugs, financed by aid:

You come to Southern Africa to visit AIDS hospitals, and you expect, or at least I expected, to find unrelieved sadness. But something positive has happened recently because of the confluence of three factors. The first is the spread of antiretroviral treatment programs. Second, some African governments have gone on the offensive against the disease. And third, the U.S. and other countries are pouring in money to pay for treatments. So now you run across health workers who have been laboring for years and watching people die, but who suddenly have the means to offer life. You have, amid the ocean of despair, this archipelago of hope, hospitals that are ramping up treatment programs as fast as they can, even while bursting out of their walls. In Namibia, for example, only 500 people were receiving treatment in January 2004. Now over 9,000 people are, and the number is rising rapidly. … I came here expecting despair, but now realize that we should be redoubling our efforts out of a sense of opportunity. I came here aware of controversies about abstinence versus condoms in AIDS prevention programs, about U.S. aid versus multilateral aid, and now realize that all that nonsense is irrelevant on the ground. This is a world of people trying everything, of doctors from Russia, Egypt, Cuba, Germany and Zimbabwe. Many are backed by money from the President’s Emergency Plan for AIDS Relief, finally doing the work they’ve always dreamed of doing.

Am I the last person to have discovered this hilarious site, set up to enable ordinary Americans to thanks Tony Blair for his steadfast support of George Bush in their adventure in Iraq? Visitors are invited to post their comments which "are printed on paper, and wire-bound into books of 250 messages. Message books are shipped to 10 Downing Street in London weekly.". Here is a sample:

Don’t let all the recent criticism get you down. There is widespread understanding among the American public that the liberation was undertaken for the noble cause of helping the Iraqis, as well as legitimate national interests of the U.S. and U.K. – Oregon, USA

P.S. On a lighter note: My wife has shifted her home decorating tastes from French Country to English Country in the aftermath of the war. – California USA

You turned one of the darkest chapters of modern history and brought light to the Middle East. Thank God for you. – Australia

I thought Thatcher was good. You’re gooder. – Arizona, USA

To truly win this war, a revolution needs to occur in the Islamic world to bring them out of the dark ages. A free and democratic Iraq is a great starting place. Your courage in doing what is right, instead of what is politically expedient, places you in the pantheon of great leaders like Winston Churchill and Margaret Thatcher. Arizona, USA

Terrible news from Ethiopia, where demonstrations on Wednesday about alleged election rigging ended in violence and the death of several protesters. Andrew Heavens, a photo journalist, has been recording events in his outstanding blog, Meskel Square. I confess that I have been an admirer of Prime Minister Meles Zenawi, who has made an extraordinary journey from hard left guerrilla leader to a moderate, free market democratic leader. But the nature of this violent clampdown on demonstrations cannot be condoned or ignored. Some people write about governments as if they fall neatly into easily identifiable categories. Some do: Robert Mugabe’s government is bad; Abdoulaye Wade’s government is good. But for most, the judgement is much more complex. In many developing countries, they face almost unimaginably difficult resource constraints with which they must try to deliver the basic government services, such as courts, tax administration, police services, air traffic control, an army, parliament, and a central bank, let alone services such as education and health. They often depend on complex political coalitions for their continuation in office, and have constantly to bear in mind the fragility of the democracy. Progress is often slow and patchy, and there are occasional backward steps even among countries that are moving forward. Of course, we in the rich world are not entirely immune from scandals and even violence. Bishop Desmond Tutu reminded us on Radio 4 yesterday that it was Europe that brought us two world wars in the last century, and ethnic cleansing in Bosnia only a few years ago. He reminded us that we have seen grand scale corruption and theft in Enron and Parmalat, on a scale that dwarfs corruption in Africa. He didn’t say – though he could have – that almost all the corruption in developing countries depends on our bribes by people from rich countries. He was too polite to mention the violent suppression of demonstrations in our own democracies (think of Derry or Chicago in 1968). Nor is it only developing countries that imprison people without trial or legal representation because they believe that it is in their security interest to do so. None of which is intended to justify what has happened in Ethiopia. Over time, we must hope that we shall understand the events of last Wednesday more clearly, and that those responsible will be held to account. This is not the first time that the government has used excessive violence in suppressing demonstrations – 25 students were killed in Awassa in May 2002. Somehow this will sound weasily, but we should think carefully about how this affects our overall judgement of the Government. The recent elections were the most free and fair Ethiopia has ever seen, and the first to invite foreign observers; and the gradual liberalisation of Ethiopia’s economy has resulted in enormous gains for the poor. The responsible way in which the Government has taken steps to identify food shortages, and work to overcome them, has almost certainly prevented a repeat of the famines of the 1970s and 1980s. We will learn a little more over the coming days; and the way in which the Ethiopian Government deals with this brutality will send an important signal about its commitment to building a free and just society. But we will also learn a little about the ability of our own Governments to respond appropriately to this serious stumble on the road to freedom. See also

Now here is some good news. Apparently, being a geek (preferably a scrawny geek) is now considered attractive.

"I think geeks are more successful. They’re happier in the work they do," Koppel [Elle magazine's love and sex advice columnist] said. "And they’re pretty faithful people, because they’re certainly grateful for anything they have." When it comes to the between-the-sheets aspect of the relationship, Carroll agreed that a girl couldn’t do much better than a less-than-perfect male specimen. "We’ve all been to bed with the guy who is worried about what he looks like, checking the mirror before he gets in bed," she said. "The nerd, gloriously, stunningly, perfectly, is into the woman. That right there is very stirring, sexually." … For a modern girl who is far from ditzy, the geek could be the mate who brings security and a load of eclectic interests to the relationship. Even the once-naughty Aguilera managed to find a guy who defines devotion and doesn’t compete to be the sexiest one in the relationship. Clearly, it’s what a girl wants.

Amen.

Economists will be in favour of road users paying what it costs to use their car – including the costs of pollution, other damage to the environment, and congestion. So I am broadly sympathetic to Alastair Darling’s proposals to charge road users. But I don’t understand why it isn’t simpler and less bureaucratic just to put up road fuel duty? (I would abolish the Vehicle Excise Duty at the same time.) Fuel consumption isn’t an exact measure of the full cost of a mile driven, but it must be a pretty good approximation. Are there really big enough benefits from using a satellite tracking system to charge by the mile, instead of charging per gallon of petrol used, to justify the huge cost?

Interesting report from the New Economic Foundation (pdf) about the rise of "Clone Town Britain".

In the place of real local shops has come a near-identical package of chain stores replicating on the nation’s high streets. As a result, the individual character of many of our town centres is evaporating. Retail spaces once filled with independent butchers, newsagents, tobacconists, pubs, book shops, greengrocers and family-owned general stores are becoming filled with supermarket retailers, fast-food chains, and global fashion outlets. Many town centres that have undergone substantial regeneration have even lost the distinctive facades of their high streets, as local building materials have been swapped in favour of identical glass, steel, and concrete storefronts that provide the ideal degree of sterility to house a string of big, clone town retailers.

In general, it is not WalMart that puts small, local shops out of business, but WalMart’s customers, who choose to shop there. And since they clearly prefer the value that WalMart provides to the convenience – at a price – of more local shops, then it is hard to see how the customers could be worse off as a result of having that choice. I personally prefer small traders to large chain stores, and I generally shop in my local, sole-trader grocery store rather than Safeway across the road. But I am in the fortunate position of being able to afford the slightly higher prices that I pay as a result. For many people who live within very tight budgets, the cost reductions provided by the large-scale retailers are of considerable benefit. The willingness to pay higher prices to preserve local, independent retailers seems a somewhat bourgeois luxury; and I have little time for those who want to use the planning system to limit access to the lower prices that the big chains can offer. But the NEF report makes an interesting point about the value of diversity which is threatened by the growing domination of a small number of chain stores. They make the analogy with genetics, in which diversity lays the basis for natural selection, and hence the evolution of better genes. Perhaps we need diversity in our towns and retailing to provide an environment for innovation and hence improvement? Most societies have norms – usually enshrined in law – against incestuous relationships with close relatives. The reason for this is that there is a public good interest in preserving the diversity of the gene pool. By analogy, I suppose there may be a case for public policy to promote greater diversity in our towns, despite the market pressures towards homogenisation.

I’ve had two wisdom teeth taken out today. The good news is that it was very straightforward. A couple of injections near each tooth, and then less than 15 minutes each. But despite the anaesthesia, there is something unspeakably uncomfortable about having a tooth extracted. You can feel the instruments being put into your mouth, and clamped around the tooth, and then the tooth is wiggled (I assume to break the roots, or whatever it is that holds them in.). Eventually the tooth is loose enough to be levered out. If the anaesthetic works (as it did for me) then there is no pain; but you can feel the threads breaking as the tooth is worked free and removed. I wonder if the discomfort is caused, in part, by Hollywood’s portrayal of sadistic dentists, for example in Marathon Man (and Little Shop of Horrors). I couldn’t quite get out of my head the feeling that I was being tortured. Even though I could feel no pain, I felt very vulnerable as my dentist used a pair of medical pliars to work my teeth lose and remove them. My grandmother had all her teeth removed when she was quite young. I think that is what they used to do before the second world war, to avoid tooth decay.

This is an excellent post by Brad DeLong, explaining why free trade can only be good, and explaining why we should not worry that all our jobs and income will shift overseas. As the interesting discussion that follows the post makes clear, it is important to distinguish comparative from absolute advantage to understand why we all benefit from free trade. Paul Samuelson once said that the theory of comparative advantage is the only proposition in economics which is "both true and non-trivial".

Thanks to EU Rota, I got tagged for the book meme to tell you about my reading habits. Number of Books I Own I reckon about 2,500. They are mainly boxed up and in store somewhere in Gloucester, while I live in the US for a couple of years. I miss having them around. Last Book I Bought The Wisdom of Crowds: Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations by James Surowiecki Last Book Read London Fields by Martin Amis Trying again – having got half way through it a few years ago. Five Books That Meant A Lot To Me This is really hard. I’m assuming this means books that were important in shaping my life. There’s more non-fiction than fiction as a result, which doesn’t feel as if it properly describes my reading habits.

  • Gödel, Escher, Bach: An Eternal Golden Braid by Douglas R. Hofstadter
  • We Wish to Inform You That Tomorrow We Will be Killed With Our Families: Stories from Rwanda by Philip Gourevitch
  • The Selfish Gene by Richard Dawkins
  • Running and Being by George Sheehan
  • Brave New World by Aldous Huxley

Passing this on to: I am passing this meme along to: My Dad, Jim, John, Jardynce, Dave.

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