A theme we will be exploring in the months ahead --- in the wake of the British Columbia HST revolt, the US Tea Party movement and other similar populist movements -- is the top-down way public policy is delivered. Kind of, we went to the best schools, we studied this stuff, we know what's best, and we know what's best for you. A good piece on President Obama's best and brightest instincts and how it has not necessarily served him well in his first 18 month as President, particularly in terms of economic policy. Larry Summers it seems was given the boot from Harvard for a reason.

http://markhakomaki.com/blockprints.html

Ben spoke and some commentary. US GDP numbers confirm the economy is slowing and some commentary. Japan's Foreign Ministry announces a requested increase in foreign aid. The importance of trade in creating wealth, the case of Brazilian agriculture, the importance of Doha, and some interesting analysis of Chinese and Indian trade. And Japan shows its death chamber to Japanese journalists, opening a difficult door to a difficult debate.

Frank Rich on the elitist instinct of the Obama Administration.

Of course Barack Obama was too hot not to cool down. http://www.nybooks.com/articles/archives/2010/aug/19/why-has-he-fallen-short/

According to Ben Bernanke, the cavalry is ready to come to the rescue of the economy, kinda.

The Federal Reserve chairman, Ben S. Bernanke, signaled once again on Friday that the central bank was prepared to act if the economy continued to weaken, as yet another economic report confirmed that the recovery had slowed to a crawl.  http://www.nytimes.com/2010/08/28/business/economy/28fed.html?_r=2&nl=todaysheadlines&emc=globasasa1

 

Just a reminder of what the Fed can do.

 

It can purchase more government debt and long-term securities. It can try to coax down long-term interest rates by announcing its intention to keep short-term rates extremely low for even longer than the markets currently expect. It can lower the interest rate it pays on the funds banks hold at the Fed. And it can raise its medium-term target for inflation, which would discourage banks from sitting on their cash.

Three views on a slowing economy.

It is slowing.

Economic statistics released Friday offered the clearest sign yet that the recovery, already acknowledged to be sauntering, had slowed to a crawl.  http://www.nytimes.com/2010/08/28/business/economy/28econ.html?src=me&ref=business

It is really really slowing because so much growth is driven by a debt bloated state.

The latest revision for U.S. Q2 GDP came in at 1.6%, which was higher than the 1.3% reading expected by consensus, but well below the 2.4% value previously reported by the government. Thing is, the latest GDP report shows just how dependent the U.S. economy was on government spending during the second quarter. http://www.businessinsider.com/without-government-spending-gdp-growth-would-have-been-less-than-half-of-what-it-was-2010-8?utm_source=Triggermail&utm_medium=email&utm_campaign=Clusterstock_COTD_082710

 

The Foreign Ministry said Thursday it plans to request ¥436.96 billion for foreign aid in its fiscal 2011 budget, up 5.7 percent from the initial budget for fiscal 2010, in a bid to curb the declining trend of the nation's official development assistance.  http://search.japantimes.co.jp/rss/nn20100828b1.html

THE world is planting a vigorous new crop: “agro-pessimism”, or fear that mankind will not be able to feed itself except by wrecking the environment.   http://www.economist.com/node/16889019?story_id=16889019

 

 

http://www.economist.com/node/16913525

Completing the Doha Round. The urgency of now.

Expanding trade has enriched the world, and completing the Doha Round of negotiations could deliver nations – both rich and poor – from stagnation.  http://yaleglobal.yale.edu/content/long-overdue-doha-round?utm_source=newsletter1&utm_medium=email&utm_campaign=YGNewsletter

Industrial policy and trade diversification. An analysis.

Why have China and India been able to grow so quickly? This column argues that while the industrial policies pursued by both countries up until the 1980s led to gross mistakes and inefficiencies, China and India would not be where they are now without them. Their export baskets are far more sophisticated and diversified than expected given their income per capita.  http://www.voxeu.org/index.php?q=node/5436

Japan opens the door on its policy of capital punishment. To Japanese journalists anyways. Thanks to Ken in Tokyo/Hong Kong for sending this in.

One of the world's most secret execution rooms was opened up to reporters for the first time yesterday, the likely first step in a long-delayed debate on Japan' s controversial death penalty. http://www.independent.co.uk/news/world/asia/japan-opens-up-its-secret-death-chamber-to-the-world-2064036.html