Thirsty China, No Mirage, Domino Effect, Egypt’s Moment, Hunger, Ignore the Core, Gigabytes, US Innovation, Euro Au Revoir

Sorry to be such a bear on China but we can’t shake the feeling that a state directed 30-year boom gobbling up resources and labour has dangerous risks.

The same may also be said of the Arab ‘awakening’ where payback may be in store for relatives of the Crusaders.

Articles also on hunger, abandoning the core CPI measure, global internet use, the importance of innovation, and more sad commentary on the long, slow death of the Euro.

One of the consequences of market madness in China is the destruction of the country’s water supply. Thanks to Jeremy of Tokyo for sending this in.

New York Times – Plan for China’s Water Crisis Spurs Concern
North China is dying.

The Economist’s happy take on the Chinese economy, at least for now.

Economist – How Real Is China’s Growth?
I'M NOW back from China, and I'm going to resist the temptation to draw grand, sweeping conclusions based on two weeks jaunting around the country.

We referenced a report by Societe Generale arguing that inflation would become a constant pressure from China. Thanks to David of Victoria for sending us the report.

Pdf below -- The Chinese Domino has Fallen

Will democracy in Egypt be captured by a medieval or modern Islamic political party? (ed’s note – a change of name would be a good start).

Financial Times – The Brotherhood’s Determined Stand
Crowds elbow their way to the entrance of the Shepheard Hotel on the banks of the Nile, arguing furiously with the guards blocking the way to an already overflowing political meeting.

Related. Thanks to David of London for sending this in.

Independent – Arab Christians Don’t See Events in the Middle East as Liberating
Yesterday I was writing about the power of the feminist meme: today I am writing about an even absurder mental concoction, namely the "Arab Spring" meme.

The Guardian argues that the market needs help to produce enough food.

Guardian – Food: A Hungry World
Charities and development economists necessarily focus so much attention on hungry people that you might be forgiven for thinking this was a problem only and always getting bigger.

Central banks have published two different sets of inflation data one with everything and the other absent energy and food putting more emphasis on the later. The time has come to give up a bad habit.

Financial Times – Ignoring the Core Can Keep Inflation at Bay
Figures this week showed the eurozone’s inflation slow slightly during May.

The world’s hunger for internet space reveals that South Korea, France, and Canada consume the most gigabytes on a per capita basis.

Economist – Data Guzzlers
RELIABLE data about internet traffic is hard to come by.

Following up on the innovation theme, this time in the US.

Pdf below -- US Building Long Term Strategy for Growth Through Innovation

The odds of the Euro surviving in its current form are rapidly falling.

Atlantic – Euro in Crisis
I've been making the argument for a long time--at least seven years in print, and in private before that--that the eurozone looks about as stable as the Unabomber.

SocGen - The Chinese Domino has Fallen.pdf1.29 MB
US Building Long Term Strategy for Growth Through Innovation.pdf1.73 MB
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Twin Virtues: Inequality of Outcomes & Equality of Opportunity©

Twin Virtues

Ultimately, the most successful societies find the balance between the twin virtues of inequality of outcomes and equality of opportunity.

The new politics must marry the twin virtues of unequal outcomes and equality of opportunity.

When too few get too much everybody loses.

Feminism is about women living their lives on their own terms, marshalling the resources of the society to make that possible, and men embracing this as vital to a successful society and their own liberation.

Can it be that striving for equality of opportunity however imperfect the process not only benefits the individual but also creates benefits for the society that are unintended but wonderful?

Economics must be a 'moral enterprise' as much as politics claims to be. Economic outcomes need to be framed in terms of right and wrong not just efficiency if only because these often align in surprising ways that are good for society and the economy.

My vision of Canada is that any Canadian child from a family of limited circumstance can expect to have a chance at lifetime of unlimited opportunities.

Free trade is a wonderful thing. Time and time again economists have proven that free trade creates enormous wealth for each country 'on the whole'. Historians have shown that free trade is usually associated with rising political, social and cultural liberty. The perennial problem is that free trade always creates tremendous disruption for thousands even millions of individuals often concentrated in one geography, and where the state is idle, not investing in best in class instruments of social justice, free trade can be a permanent ticket out of the middle class, down, not up.

Tax policy should be founded on the principle of generating steady tax revenues sufficient to maximise environmentally sustainable economic growth in order to fund fair government.

Public policy should be designed to decrease inequality before the law and increase equality of opportunity.

Capitalism is not the problem; the problem is what we do with capitalism.

Content is always more difficult to argue than conspiracy.

Let the state regulate and the market operate (most things).

Welfare strategies are best designed as a hand up, not as a hand out.

Political debate should not be fact free fighting.

Explanation lasts longer than eloquence.

Always favour empowerment over dependency.

The most enduring public figures are embraced for the causes they fought for and not the concept of themselves they hoped others would remember them by.

Find your voice and don't be the echo of somebody else.

It is possible to operate on two different levels: the practical, cautious and conservative; and the realm of ideas, open, free, and radical.