September 30, 2006
September 29, 2006
Wolf’s skilled/unskilled dilemma also reminded me of a new development of expensive houses close to Washington, where the new owners had to get together and build some low price houses, so that persons willing and capable of being firemen could afford to move in close enough to be able to arrive before the houses had burned down. Also, in the long term, it is very difficult to see how a country could be better off keeping the relative incentives for their domestic low skilled workers high, while imposing competition on the skilled ones since to me it sounds like a sure recipe to end up as servants to the newcomers.
Finally when Wolf tells us that “Countries matter . . . as communities with a shared destiny” he, as a columnist that thrives on globalization, should also remember that whether we like it or not, all these communities are part of a bigger humanity living on a small planet.
Martin Wolf immigration skilled
September 28, 2006
Timothy Geithnert Callum McCarthy Anette Nazareth
September 27, 2006
Sir, Martin Wolf’s “America could slow us down” (September 27) somehow ignores the possibility that just as the Americans did when they accepted the “In God we trust” printed on their bills as an act of faith when the dollar abandoned its convertibility into gold, the world is now willing to live with an “In America we trust”, at least while there is such a world shortage of better alternatives. If this is so, one could argue that we have still far to travel on the roads of the American current account deficit currently used by the world to dollarize since the fact is that, if you want to lay your hand on a dollar, you have to sell or give something for it. Frightening? Yes, but is not the world itself a frightening place that needs many acts of faith in order to make life bearable?
September 26, 2006
Gideon Rachman students ego trip
MBA students cheating
September 25, 2006
World Bank Wolfowitz
September 22, 2006
Sir Samuel Brittan in “It’s not he labour market, stupid” (September 22) talking about what his Victorian forebears did is sort of hinting at the need for a new inflation measure that instead of measuring the value of a basket of consumer goods just in term of dollars, pounds and what have you should also measure it in terms of a basket of consumer assets. Though perhaps too Victorian for many, it might not be a bad idea.
Samuel Brittan inflation
global warming US gasoline tax
Peter Scholla diversification risk
Stephen Littlechild Europe mobile phones
September 20, 2006
Wolf mentions that the IMF has the potential to play a valuable part in managing the world’s transition to an integrated global financial system and tough it sounds very right it would be good if he shared with us some concrete examples of what this would entail so that we can better share into his act of faith. As an outsider that has very respectfully questioned many of the Fund’s actions over the last decade, before giving what in Wolf’s French amounts to a carte-blanche to management, the least I would expect from them is a detailed plan of action which of course should also include the terms on which they themselves will be held accountable to stop them turning into even a less legitimate new ancien régime.
Martin Wolft IMF Fund
September 19, 2006
The first is whether in a world that is globalizing you should still be looking to draw the borders along their natural lines, Bosphorus, cultures and what have you, or whether you might be better off placing those borders on more greyish terrain so as to not exasperate the differences. The second question, more pragmatically, is if instead of marrying why don’t you just move in together and see how it goes. You should never forget that a relation is always a two way street and so even while Europe might like the set up, Turkey might not. Finally, in case of separation, the “I am not good enough for you” has shown itself innumerable times to work much better than any alternative, not only because it is also frequently true.
Gideon Rachman Europe Turkey
September 18, 2006
James Tooley education private schools brands
September 13, 2006
Martin Wolf IMF Fund
September 12, 2006
Stephen Cecchettit headline core inflation
September 11, 2006
On another issue and observing how in the fight against corruption there seems to be more and more work to be done each day, we cannot think of one single reason why you feel the need to hit down so hard at Mr Wolfowitz qualifying his drive at it as obsessive. I have no doubt that the billions of individuals that suffer at the hands of corruption would all love him to be obsessive about fighting it, as long as he is was also effective.
World Bank Wolfowitz corruption
September 09, 2006
These are valid suggestions indeed and they would suffice for most occasions. Nonetheless knowing a bit myself about life out there on buffet lane, where sharp elbows compete, let me just add a couple of pointers. Mind you, just in case, for the record, let me assure you that I have never ever tried them myself, as I would hate to get entangled with some transparency advocates just because one of my parents spoiled what would otherwise be the perfect genetic map of a gourmet by spilling gourmand chromosomes all over it.
First, just as a precaution, always remember to keep a plastic bag in your pocket, for your doggy. Second do not ever sub-estimate the value of privileged information and so while looking like you’re looking for the men’s room always try to get a peek into the kitchen to see what’s cooking. Finally, numero uno, workable everywhere, even in private weddings, is to put a ten dollar bill into the hands of a waiter of your choice and then relax knowing you’re in for a special treat.
Dear Economist buffet
Sir, in your editorial “Back to work for the world’s investors” (September 9) you wisely remind us that “new paradigms often turn out to be new ways of losing money” but when you then, after only one paragraph, mention favorable possibilities in the trading of options on market implied volatility, this also reminds us of that old paradigm that says that investors go for what they least understand, since this is what allows them to harbor their largest illusions.
As someone who has extolled the virtues (and bliss) of ignorance since it helps to drive the search for greener valleys that is such an essential component of economic growth, I have been somewhat leery about the power of the web to spread too much knowledge. Luckily the duration of the information imprints are also shortening and so therefore we see that Argentina’s public debt is already back on the investor’s menu.
Finally let me congratulate you on your valiant effort to raise some sympathy for the hardships of investors and fund managers, even though it might not suffice to console those who only get their income through a salary exposed to the jaws of the global crusher.
September 08, 2006
As a citizen of a developing country I cannot help bit to reflect on the fact that if it only were we the citizens who voted on this issue, and not some of our governments, Mr Wolfowitz would count with all the international support he could ever wish for, not only with respect to the poor countries.
World Bank Wolfowitz corruption
Also on the issue that “so many countries end up with unmanageable debt burdens” he seems to blame it primarily on that those debts were contracted in foreign currencies, exposing it to global volatility and suggests as a solution that developing countries should be able to borrow in their own currencies or in a basket of currencies, but blithely ignoring the fact that most unmanageable debt burdens are just the logical consequence of the governments having contracted excessive debts for the absolutely wrong reasons.
As a citizen from a developing country I can testify that when your country cannot pay its debts because its government has wasted away the resources you really do not care whether you problem is in dollars or in pesos. Besides, if in dollars perhaps the mistakes are even more globally shared (haircuts) since, if in pesos, most of the cost, through inflation, would fall mostly on your own poorest poor.
Finally as to the high volatility of the global markets, I cannot but invite Mr. Stiglitz to try some of our attractions and then he would really be able to talk about volatility. As a financial consultant, I have seen hundreds of good projects go belly up precisely because they were not funded in dollars but in local currencies, when inflation and interest rates teamed up to overnight transform what were ten year repayment terms into effective ten months.
Joseph Stiglitz globalization confusions
September 07, 2006
There is an urgent need for the world to find ways of truly assimilating within their societies all these new non-standard workers, informal sector workers, illegal immigrants and workers that work in the everyday growing illicit activities because if we are ever going to have a chance of putting the global house in order, for instance in terms of protecting the environment, the last thing we need is the emergence of a global lumpenproletariat.
One of the real challenges we face finding solutions to these problems is the fact that since there is so little data available about these sectors our PhD researchers have nothing to run their regressions on, which makes many of them stand at loss as to what to do, and has them instead going back to study, again and again, the plenty data available about the formal sector and its standard jobs.
By the way the problems that we confront here are not really related to the issue of labor being cheap since the other side of exactly the same coin, is just that labor is too expensive.
Desmond King David Rueda global lumpenproletatiat
September 06, 2006
When does the “loss” really occur, when the worker has become globally uncompetitive or when his job finally disappears?
Fact is that whenever there is a more efficient alternative to deliver goods or services elsewhere but countries are not using them because of other considerations, like wanting to assure employments at home, these jobs are effectively placed on artificial life support and so the “loss”, when the jobs finally disappears, has much more to do with a reduction of the subsidies or the cost of keeping them, than with globalization. For instance in the case of the orange growers of rich Florida and that are now kept in business by specific duties on orange concentrate that in some cases have been equivalent to more than 70% ad-valorem duties, the already existing losers are those consumers of poor Arkansas that have to pay a higher price for their morning juice.
By the way the whole concept of “losers” is wrong if implies having to win all races, since the real losers from globalization and from all other sources of higher productivity as well, are those that hang on too long on days gone by without moving on.
Martin Wolf globalization
September 05, 2006
John Kay migration estimates
Globalization, in any form, is unequivocally here and is as a bare minimum seeping through all borders with its environmental impacts and its spread of nuclear arms capabilities. Of course there are gains, and pains, to be derived from globalization but in order to understand them better we must move away from looking at short term data like this year’s GDP growth or last year’s unemployment rate and find ways to measure it more in terms of where we would have been without it, after a couple of decades.
For instance when Kregel and Milberg mention that in “the US, a strengthening of the pension systems, a substantial increase in the minimum wage and the provision of universal access to health insurance would protect against the unequal effects of globalization” they create false expectations. Better pensions and a health insurance could indeed, if provided independently, by redistributing some of the profits, help to aminorate some local inequalities (not global) but an increase in the minimum wage would just directly eat away on the possibilities of competing in the global markets, thereby willingly renouncing to capture some of the profits that could be shared.
This comment is not intended to criticize the authors but to try to illustrate the complexities of the issues. I am the first to admit taking some wrong turns in this debate, a couple of times a day.
Jan Kregel William Milberg sharing globalization
The same could be said about democracy since when we outsiders observe the ever increasing powers of the lobbying industry in Washington and on how the representation of its younger citizens is diluted by the aging baby-boomers, some of us would argue that it could be good for America to take a time out from selling its democracy worldwide, so as to give their own an overhaul first.
That said what we truly need to worry about is if a backlash would change America from having a we-care-for-the-world attitude into a we-don’t-care-a-damn about them but that does not seem to have much to do with neo-cons either, as they sometimes have shown to care just a bit too much for their own good (and ours).
neo conservative isolationism democracy
Sir, In your editorial "What is the IMF for?" (September 1), you qualify the original formulas used to assign the quotas determining responsibilities of nations to deposit cash and the rights to borrow it as "arcane". Yet you seem to favour a recalculation that will just produce a reshuffling of the local interests. In a world where we see multinationals getting rid of their "home country", it might instead be time to introduce some representation in the International Monetary Fund that is not bound by pure arcane geographical considerations.
You mention a lack of credibility and legitimacy but seem to believe this could be solved by giving the professional staff a free rein. It is much more difficult than that. One of the reasons the IMF has lost credibility is in fact the mistakes of its staff and these go much further than the handling of the Argentine debt crisis. If you take a closer look, you will find them backtracking on so many of their "cast-in-iron" policies. The world needs not less accountability in the IMF, but much more.
In my view the Fund's problem is that it has now turned into the clubhouse of the "independent" central bankers. What instead we need the IMF to do is to open up its executive board and diversify the recruitment of its staff so there is a better chance for the board to have a healthier perspective of what the IMF's role should be.
Though I agree completely with you that the top job should not be reserved for a European, since "he must now defend interests wider than those that put him in place", may I also advance the idea that it should not be reserved for a central banker either?
September 02, 2006
Little does Dear Economist realize, perhaps he is not yet a father, that Mr. Harnsley’s problems are way beyond that stage and has much more to do with his children turning out to be more able negotiators than he, having already developed their own charts with immediate rewards that go from hugs to the screaming out of accusations such as, mommy, daddy spanked me!
At the end of the day, of course it is all an issue of negotiation but where does Dear Economist get the notion that the children are more hooked than their parents to immediate gratifications? Since he blurts out something about children’s high discount rate and short term horizons I must ask him to look around and see the many non-existent savings rates and fiscal deficits that are out there in the world of the parents, just to finance their current consumption.
Dear Economist child rearing immediate gratification spanking hugs allowances
September 01, 2006
Sir, as you so correctly state in “Sweden’s decision”, September 1, many countries around the world do indeed follow with much interest what those Swedes are up to and so it is very important to be very clear about what they really do. For instance when you mention to “combine a vigorous private sector with high taxes”, we know that many in the developing countries would read that as having high corporate taxes, though in fact in Sweden high taxes are applied primarily to the individuals, after fairly low taxes on the corporations have allowed the individuals to find well paying jobs. In this respect my reading on what changes are currently on the menu in Sweden, especially those related to payroll taxes, sounds very much like traditional standard fare of old Swedish pragmatism and that looks to make it easier to create those jobs they intend to keep on taxing, just the same.