Posts of April 2012

Globalizing Bad Taste in Cars, BRICS+Beckham Edn

♠ Posted by Emmanuel at 4/29/2012 11:42:00 AM

[A weekend feature! It's been such a long time, but rest assured that I still speak of political economy.] Way back when, anyone with a passing familiarity with the automobile business knew what the most important auto shows were: Detroit, Frankfurt, Geneva, Paris, Tokyo. The presence of marques on parade varied by where the automakers hailed from along with how far along the vehicle prototypes on display were in terms of becoming production models. To be sure, some will always be fated to show duty. If you've been to one of these events, there isn't much variation among them: pretty girls broadly beaming from the stands ("Excuse me miss, but do you come with the car?"), corporate types mulling about in dark suits, and more-dishevelled motoring journalists taking photos and lining up road tests.

Fast-forward to 2012 and certain geographic certainties have changed. China overtook the United States as the world's largest passenger vehicle market in 2009. Naturally, automakers and the general public in the run-up to this inevitability began to ask: "Why isn't there a major auto show in China given that it is the new promised land for automakers and as demand for cars in industrialized Europe, Japan and the US wanes?" Voila! The Beijing International Automotive Exhibition or more informally the Beijing Motor Show was born in 1990 and has been held biennially alike its more famous global counterparts.

To be sure, it's been slowly gathering momentum despite being held in a city famous for smog and its negative implications for glamorizing automobiles. So there you have the first component in this tale of auto industry globalization in the emergence of the PRC. Another, though, concerns the make under consideration here. I've long followed the process by which Indian conglomerate Tata first considered buying then bought the formerly Ford-owned British marques Jaguar and Land Rover in a process of "reverse colonization." While the Tata Group is today's equivalent of the Indian Company that Makes Everything--do you know anyone else who's bought into English tea and cars--there remains the question of how "British" these products now are.

Hence we have the very dubious attempt here to (1) reinforce "Posh Britishness" [that's capital P, mind you] by de-emphasizing who exactly owns Land Rover, (2) glamorize its vehicles by signing on probably the world's most famous footballer's wife and (3) feminize this SUV brand renowned back in the day for making the most rugged of go-anywhere vehicles alike the Land Rover and the Defender. While this trend of gas-guzzling off-roaders being used for everything but real 4x4 action has been going on for a long time now, we've certainly reached new highs--or lows depending on your point of view. Combine all these things--the big Chinese market, Indian wannabes aspiring to Cool Britannia, and a Chinese auto show in search of a marquee launch--and you get the Range Rover Evoque with Victoria Beckham. It's fitting that such prissiness at the Beijing Motor Show is covered not in, say, 4x4 Magazine but in Vanity Fair where Missus Beckham describes her co-creation as--get this--a "[hand]bag on wheels":

I’ve driven a Range Rover for as long as I can remember, and I have a lot of respect for Range Rover as a brand and for their heritage. So I think it feels very natural. I think that people will look at the car, and they’ll obviously see Range Rover, but they’ll also see me. It looks like me. I joked the other day—I had a matte-black crocodile structured handbag with me, and I looked at the bag and I looked at the car, and I said, “The car looks like a bag on wheels.” It’s very me. It’s very, very me.

She reassures us, however, that there is a subtle machismo at work here by invoking her hubby, that alpha male character:

And I was adamant—I didn’t want this car to be seen as super-girly. I wanted it to be a car that I want to drive, and I wanted it to be a car that David wants to drive as well. Everything that I do has quite a masculine feel about it. Though the clothes I design are very feminine, they also have a very strong masculine feel about them. I’m feminine, but I wouldn’t say that I’m girly in any way at all.

As a competitive response to the Range Rover / Victoria Beckham lash-up, I eagerly look forward to the Hummer / Paris Hilton Special Edition combining all-season, all-terrain prowess with the cuddliness of a miniature pooch. For the PR flaks, maybe it should do Missus Beckham one better to be described as a chihuhua-in-a-handbag-on-wheels. To paraphrase a certain song, automakers have been asking the Chinese what they want--what they rilly rilly want. And if the result is as appalling as the Range Rover Evoque with Victoria Beckham, well, its Indian owners couldn't care less about whiny aesthetic critics who aren't paying customers anyway.To be sure, this move has long been underway with various luxury makes producing oversized gas-guzzlers that target mainly bling-bling and soccer mom demographics, but never in such a blatantly cutesy fashion.

But if that's what they want--what they rilly rilly want--then I guess we'll just have to grin and bear it.

Bad Habits Die Hard: On USAID "Relaxing" Tied Aid

♠ Posted by Emmanuel in Agriculture,Americana,Development at 4/26/2012 01:33:00 PM

Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime - Chinese proverb

Give LDCs subsidized American foodstuffs and you can feed them for a while, albeit with the risk of decimating unsubsidized local food production. Help develop their food self-sufficiency by buying food locally...well, to hell with that - paraphrasing US aid policy

Here's a very important development you may have missed: I certainly did because it wasn't widely publicized at the beginning of the year--even in development circles where I assume it's groundbreaking news. The US Agency for International Development (USAID) has repeatedly been cited as one of the most flagrant offenders in the tied aid sweepstakes. That is, this aid agency has been encouraged to give business to American contractors for various development and emergency relief projects. The pitfall here is obvious: instead of supporting budding enterprises in developing countries, USAID has traditionally obtained supplies from stateside since it was obligated to do so regardless of cost.

The argument many USAID folks make nowadays is that this is no longer so. The proportion of tied aid to untied aid is supposedly falling. More recently, the (mostly unreported) news concerns the US government now allowing for procurement from non-US suppliers of aid goods and services. Not only should inefficiencies due to distance such as spoilage be minimized, but USAID should be able to procure these more inexpensively. Times have changed, or so they say:

Because of the end of the Cold War and the subsequent globalization of the economy, this [tied aid procurement] approach has become increasingly difficult to administer and, in some respects, obsolete. The costs of compliance with the complex regulation, and of the self-imposed and unnecessary restrictions on procurement in recipient and developing countries means that the foreign assistance dollar does not go as far as it would with a more straightforward regulation that reflects the statutory authority to procure in the recipient country and other developing countries, in addition to the U.S.

Which is all well and good, but the most symbolic of all forms of aid is excluded. Just as Live Aid's refrain was "feed the world" and USA for Africa zeroed in on hunger, particular attention will be placed on alleviating food scarcity. Unfortunately, untying aid does not extend to that particular area. From the Guardian, we are provided an exclusion list:

But last month, USAid revised its procurement regulations. The new rules...will allow the agency to purchase most goods and services from developing countries, with notable exceptions including US-funded food aid, motor vehicles and US-patented pharmaceuticals...

The new rules do not extend to US-funded food aid. Under federal law, the vast majority of American food aid must be bought from US suppliers and transported on US ships. Also exempt from the new regulation are motor vehicles, which must be made in America, and US-patented pharmaceuticals, which can only be manufactured outside America with express permission from the patent holder. The procurement changes do not extend to other US agencies that spend foreign assistance.

The motor industry's capture of the US government is obvious given the huge bailouts of GM and Chrysler during the subprime crisis. That pharmaceutical firms would allow the US government to purchase generic drugs only over their dead bodies should be plenty obvious, too. However, it is galling that the most symbolically important aid of all, food, continues to be so influential in the formation of US aid policy. It returns us to that chestnut of a debate over rich world farm subsidies hurting LDC farmers. Just in time for the 2012 Farm Bill come these aid controversies. As the proverb above suggests, what lasting good does temporary aid consisting of US foodstuffs (which are likely highly subsidized and may hurt poor farmers who cannot compete with American giveaways to rural interests besides) do?

I suspect the main reason why this untying of aid has received so little attention is because it doesn't really address these grievances concerning American government policies that support overzealous IP protection over pharmaceutical products and the continuing unavailability of support for overseas food procurement.

Moreover, does USAID really aid represent goodwill on the part of the American people given that federal outlays like aid are significantly funded by others? I guess it's white man, forked tongue...and tied food aid.

6/365 Egyptian Lawmakers Vote for IMF Rescue

♠ Posted by Emmanuel in IMF,Middle East at 4/25/2012 10:09:00 AM

Those are such bad numbers you too probably wouldn't have missed much by not getting out of bed.

I am simultaneously fascinated and appalled by the developments in Egypt. Among the more influential academics in policy circles--see Anne-Marie Slaughter especially--there's been this idea that we're in a new foreign policy frontier where the availability of digital tools to the average person has reshaped the conduct of diplomacy. This sort of thinking is tied in to the neo-triumphalist version of the Arab Spring in which the "Internet freedom fighters" or whomever the Americans like to style them as to suit their own particular version of events overthrows a nasty (and don't forget longtime US ally replete with aid largesse over the years), autocratic regime.

Well here's the reality for you: It has come to pass that the "Allah and moolah" scenario I painted of Islamic lawmakers voting down much-needed IMF support has come to pass. So the freedom-loving digital mob has helped replace the old regime with...er, a well-established and well-organized hardline Muslim organization that now dominates parliament. Oh by the way, the new order or whatever passes for it won't accept conditionalities from the IMF due to some special dispensation whose exact nature I'm yet to pinpoint (see previous link).

Religious zealotry and unrealistic expectations of how the IMF grants emergency loans aside, there is utterly nothing new to this story: (1) Contrary to all the neo-triumphalism that surrounded the Arab Spring--call it the end of modern Arabic history--the replacement of a comparatively stable authoritarian regime by an unstable one with a volatile mix of military and fundamentalist identities has destabilized the Egyptian economy. Tourism--an important source of foreign exchange--has been particularly hard hit. (2) The still-US dominated IMF will only lend emergency funds to a now-troubled Egypt on its own terms.

Where exactly, then, is the change in this new foreign policy frontier? From where I stand, the overall description of events could be a generic description of a troubled LDC circa 1972 instead of 2012 and the instrument of financial enlightenment of Western powers:

Egypt's parliament overwhelmingly rejected the army-appointed cabinet's plan to cut state spending on Tuesday, complicating the government's efforts to secure IMF help to fight a balance of payments crisis. The International Monetary Fund (IMF) wants the backing of Egyptian political forces for the government's economic reform plan before it signs off on an emergency loan. Egypt has been hamstrung with economic troubles since a popular uprising in January last year.

Prime Minister Kamal al-Ganzouri's government presented the Islamist-dominated parliament with the plan on February 26 and it has been discussed over ten sessions. Only six out of 365 lawmakers who cast their votes approved of the plan, which was criticized as vague and incoherent. Some said the program failed to improve public security, reduce poverty or provide the revenue to raise wages. Assembly speaker Saad al-Katatni said the "government must submit its resignation to the head of state".

Again, there seems to be utter incomprehension among the newly-installed parliamentarians about what the IMF does. It is not concerned with public security as an international financial institution, nor are the usual prescriptions involving austerity meant to encourage higher wages for public servant of all things. That the current military caretaker head is due to be replaced by a less secular figure may go in one of two directions: more parliamentarians sympathetic to the Brotherhood may be willing to support a package negotiated by one of their own, or the "no conditionalities" impracticality favoured by certain hardliners could become the baseline Egyptian demand.

Either way, I doubt these negotiations will proceed smoothly. It's certainly feasible that the same "Internet freedom fighters" may soon regret their actions given that, in most economic respects, Egypt is quantifiably worse off than it was than under Mubarak--and has a high probability of becoming even graver as this "Allah and moolah" impasse drags on. But that's just me; the official IMF blurb says...

The IMF remains ready to support a home-grown program that maintains macroeconomic stability and promotes inclusive growth, enjoys the necessary broad political support and includes adequate external financing from Egypt's international partners"..."We look forward to advancing these discussions and to bringing a program for consideration by the IMF Executive Board as soon as the above conditions are in place.

And that's all she wrote about the Egyptian uprising.

Fight-a-Bully: Philippine, PRC Territorial Disputes

♠ Posted by Emmanuel in China,Southeast Asia at 4/22/2012 11:03:00 AM

[NOTE: Perhaps it's not obvious for me to begin writing about a territorial dispute by talking about lawyers, but why I'm doing so will be obvious soon enough.] While I suppose a certain number of lawyers are necessary for modern societal functioning--drawing up contracts, settling contractual disputes, finalizing Larry King's divorces and so on--too many lawyers is a dubious situation. Not only do their functions primarily concern wealth redistribution rather than wealth generation, but having too many folks train for these occupations of often dubious worth may result in unemployment of their sort.

While the United States remains the world's archetypal lawyer-infested economic laggard, there are others. A case in point is the Philippines. With many of its institutions--educational, legal, and so forth--modelled after the late colonizer's, this English-fluent nation is unsurprisingly very much in the American mould for better or worse. So there's a perversely high regard for this occupation, with scads of wannabe legal eagles. To what extent is the Philippines' slower economic growth compared to regional peers down to excessive lawyering? It's certainly a question you can investigate empirically by using the number of lawyers per capita as an independent variable or even diminished trust / social capital as a moderator variable.

But, the important thing is that, combining the Philippines aforementioned penchant for lawyering with its culture of migration and you have interesting results. As it so happens, some of the world's top international judges have come from the Philippines. Exhibit A is the WTO's Dispute Settlement Appellate Body. Since the WTO generally styles itself as being more inclusive than the World Bank or IMF whose leadership is always baked in Washington or Brussels, it has assigned prominent tasks to more (token?) folks from LDCs. From the WTO's inception to 2001, Florentino Feliciano served on the Appellate Body. Lilia Bautista also hailing from the Philippines served there as well from 2007 to 2011.

As it so happens, all this Filipino lawyering may soon come in handy--or at least the Philippine government hopes it will. While of guns and money the Philippines has far fewer of than China, lawyers capable of prosecuting international law it probably has more of. Hence the differential response to the current imbroglio over the Scarborough Shoal. So much trouble over an uninhabitable little rock in the Pacific. While China keeps affirming its mumbo-jumbo about finding a peaceful resolution to the dispute, it has sent additional vessels to the general vicinity. Meanwhile, the Philippines has asked China to bring the matter to the International Tribunal for the Law of the Sea (ITLOS)--as I've suggested it do so with the other disputants to settle the matter once and for all.

Let's just say the Chinese have not been amenable to arbitration despite being an UNCLOS signatory, with the Philippines even indicating that it may bring the matter up at ITLOS "unilaterally." So much for Chinese avowals of respecting international law--which, like the US, it conveniently ignores if it serves their own interests. The Scarborough Shoal being far closer to the Philippines than the Chinese mainland aside (said to be 140 nautical miles away compared to 750 miles away), there's also the matter of China' historic claim. The Chinese like to point out that various historic documents--maps and so forth--indicate the features in question have long been "part of China." That said, Philippine authorities point out a historic claim does not hold anywhere near the same legal weight in international law as a historic title. Revisit the UNCLOS text.

Needless to say, while the Philippines' claims are also subject to contestation, China's are too. International law is an area where the Philippines can engage China on more even terms, but alike all with the other disputants, China avoids "multilateralization" and in so doing continually reinforces its "divide and conquer" reputation when it comes to this territorial dispute. Sure it's easy to beat up the Philippines on its own, but what does that do for China's desired image of a "peaceful rise"?

So this situation is certainly at another impasse. More apocalyptic sorts are wondering if the US will come to the Philippines' aid under their Mutual Defence Treaty of 1951 if skirmishes break out in the South China Sea. Meanwhile, for reasons given above, the Philippines wants to sic the lawyers on China. It's one area where the Philippines perhaps has an absolute advantage over China. As I said, it's the natural response when you've got few guns and money but plenty of lawyers. Bad for development perhaps, but the Philippines hopes it's more beneficial with regard to territorial disputes.

UPDATE I: RP Foreign Minister Albert del Rosario believes that taking the matter to UNCLOS unilaterally is not an entirely empty gesture:

Del Rosario said that the UNCLOS provides five dispute settlement mechanisms, including the International Tribunal for the Law (ITLOS) of the Sea and the International Court of Justice [ICJ]. One more mechanism is a "compulsory conciliation system where you can go without China"..."You can proceed without China and get a judgement, but in that compulsory conciliation, the judgement is not legally binding but it does have moral suasion," Del Rosario said.

UPDATE II: To be fair, it should be noted that the Philippines has not had an ambassador to China for nearly two years now since the legislature has held up sending someone to China. Not sending a high-level Philippine diplomat may be a perceived by the Chinese as a slight. However, present circumstances may make the Philippines move faster.

Why LDCs Won't Give the IMF More Money

♠ Posted by Emmanuel in IMF at 4/20/2012 09:06:00 AM

I am rather tired of reading news clippings about how LDCs are reluctant to give the IMF more money when their grievances are not given proper airing. If you're looking for a global governance dinosaur par excellence, then I will give you the IMF. Imagine that we were stuck in the Fifties, the White Man's Burden of civilizing various coloured people was still underway, and the global financial crisis that has greatly undermined the West's hegemony didn't happen.

In this Mad Men-ish time warp, we'd expect a couple of things. First, the IMF head would always be a Caucasian Westerner despite all the changes that have occurred in the world economy during the postwar period. Check. Next, in the event that core Western nations were themselves in trouble--European nations borrowing in the hundreds of billions instead of lending and the United States piling on national debt at the rate of over a trillion a year--you would solicit money from the rest. Which is all well and good had you given them more voting rights to accompany their increased contributions, but it simply isn't so.

The particular problem here is that most recent LDC contributions have been funnelled into the New Agreements to Borrow (NAB), whose main distinguishing feature as far as we are concerned here is that no additional quotas are granted to contributors:

The NAB is a set of credit arrangements between the IMF and 38 member countriesand institutions, including a number of emerging market countries. The NAB is used in circumstances in which the IMF needs to supplement its quota resources for lending purposes. Once activated, it can provide supplementary resources of up to SDR 370.0 billion (about $570 billion) to the IMF.

In other words, contributions to NAB do not count towards additional voting rights as manifested by quotas. The obvious fear is that LDC contributions (which are unlikely to materialize in significant amounts anyway) will once again be shunted off to the non-quota NAB. For business types, it's alike purchasing preferred shares which are non-voting by convention. But, at the IMF, their holders are treated not preferentially but discriminatorily via stitch-ups for its leadership and lesser claims compared to plain old quota shares.

Why would you want to participate in such a rigged game? For all the talk about a "major realignment" of quota shares, the IMF's' ancien regime of top shareholders remains firmly in place:

UPDATE: Reuters has more on the domestic politics in the EU and the US delaying previously agreed-to reforms.

IMF's (Shocking?) Endorsement of Procyclicality

♠ Posted by Emmanuel in Energy,IMF at 4/18/2012 03:44:00 PM

I needn't recycle criticisms you're most familiar with concerning how the IMF exacerbates difficulties by deterring poor countries from using countercyclical policies to cope with downturns--either indirectly via policy suggestions during Article IV consultations or via conditionalities when they encounter balance of payments crises. Review the Joseph Stiglitz (countercyclical) versus Kenneth Rogoff (balanced budget) debate over Washington Consensus-style policies.

Recently, I received an invitation to attend the rollout of the IMF's flagship publication, the World Economic Outlook, which is published biannually. Apparently, various IMF research team members go on an international roadshow to launch this publication since it's yet another I've attended in...another part of the world. While the WEO admittedly contains a lot of useful information about general macroeconomic trends, I've found the economic forecasts more of a mixed bag. Hence, I did not expect to find anything startlingly new in the current April 2012 report.

Boy, was I wrong. Dead wrong, in fact. While its (rather randy, dontcha agree?) previous Managing Director Dominique Strauss-Kahn famously declared the Washington Consensus-era IMF a goner, limited transference has been seen in policy suggestions given to poor countries. Unfairly perhaps as some suggest, industrialized countries have been given a free pass in "pump priming"--but not LDCs. During the presentation, though, I was astounded to see as graphical an illustration of new thinking as you'd hope to find. Since this issue's theme is commodities, one of the things the authors studied was the impact of fiscal policy when exporters encounter a global supply shock. Quite apropos for the times, methinks. Modelling these conditions for a "small, open oil exporter" (read: LDC), they came up with this chart taken from p. 19 of chapter 4 concerning Commodity Price Swings and Commodity Exporters:

Shock! Horror! Panel 1 is obvious: the volume produced by a "small, open oil exporter" has a negligible effect on global energy prices. However, panel 2 is as blunt a mercy killing of the "Washington Consensus" as you're likely to get from these folks and their econometric models. Your eyes don't deceive you: According to IMF research, an LDC commodity exporter would be far better off running a countercyclical policy in the run-up to and in the aftermath of such a shock. Sure they may not reap the full rewards of steep price rises in the immediate aftermath, but they're better positioned in the longer run to reap continued benefits instead of succumbing to a typical boom-bust pattern.

And in case you're wondering, the wording of these scenarios indicates I'm not making this stuff up. First you have the balanced budget (AKA Washington Consensus) scenario:

A balanced budget rule: Under such a rule, the government budget is balanced in every period, so all exceptional commodity royalties and tax revenues are redistributed immediately to households through lower tax rates. This rule is procyclical by design but maintains fiscal balance and net debt at long-term targets.

Meanwhile, the countercyclical scenario is as follows:

A countercyclical rule: Under this rule, the fiscal authority not only saves exceptionally high commodity royalties and tax revenues, but also increases taxes to dampen the stimulus to aggregate demand from higher oil revenue accruing to the private sector. In the case of exceptionally low royalties and tax revenues, taxes are lowered temporarily. This rule implies larger changes in budget surpluses and government debt in response to oil price changes. However, it acts countercyclically, increasing (reducing) the structural balance
during periods of strong (weak) oil prices and/or economic activity.

Yes, there are many contextual qualifiers offered here. It pertains to a small oil exporter that does not habitually run substantial fiscal deficits (i.e., one that actually has savings to spend during downturns) etc. But, to depict matters so starkly in favour of something the IMF would have once objected to vehemently not so long ago illustrates the evolution in IMF thinking.

That said, I'm not entirely convinced that this sort of thinking filters down to policy prescriptions IMF staffers make. Sure it sounds nice to read about the kinder, gentler IMF that gives a thumbs-up to pump priming. But, do the visiting IMF country teams now dispense the same sort of policy advice--especially when poor countries alike commodity exporters run into trouble? I believe that important questions remains to be answered.

Lingo Wars: Urban Dictionary v Academie Francaise

♠ Posted by Emmanuel in Europe at 4/17/2012 12:09:00 PM

While most things Anglo-Saxon are taking a well-deserved beating nowadays--neoliberal economic policies and a penchant for soaring rates of obesity among other things--there remains considerable vitality in their common language. As the Global Transformations crew rightly pointed out sometime ago, having the most speakers of a language doesn't make it a "global language." For, if this were the case, then Mandarin would be the world's lingua franca. Instead, it's English that makes the claim, being the language expected to be spoken among business and political elites. With the coming of the Internet, those most able to propagate their views remain English speakers, for better or worse.

It was not so long ago when French aspired for similar status. While it may have currency in certain diplomatic circles even in this day and age, its claims to widespread use in commerce and pop culture are iffy at best. In a way, the treatment of these languages by their respective progenitors mirrors their respective government's penchant for economic intervention. The (mostly) laissez-faire English couldn't care less about the adaptations and proliferations the language has undergone, from pidgin English to American English. So, for instance, the global financial crisis and the the tubby nature of many Anglophone residents are symptomatic of "first world injury." The Urban Dictionary is a vast complilation of such colloquialisms--many more offensive than these, and some of which eventually make the gold standard for such references, the Oxford English Dictionary.

Meanwhile, the dirigiste French still have a high-faluting body which guards the sanctity of their language--especially against intrusions of lowbrow English terms (the likes of which you're likely to find in the aforementioned Urban Dictionary). Our friends over at the World Policy Journal have an interesting feature concerning the Academie Francaise, guardians of French against poor language use. English slang, mon dieu!

In 1635, Cardinal Richelieu, chief minister of Louis XIII, established an institution known as L’Académie Française—the French Academy. Its mission was then and remains today to serve as the guardian of the integrity and sanctity of the French language. At its full strength there are 40 members, elected by their peers for life. Each takes the seat vacated by the death of his or her predecessor and named for the individual who first held that seat in 1635. Accordingly, they are known as The Immortals. Each Thursday, they gather beneath the cupola of the Institut de France, which has dominated the Left Bank of the Seine overlooking the Pont des Arts since its construction by Richelieu’s successor, Cardinal Mazarin, in the 17th century.

They are at work today on the ninth edition of the authoritative French dictionary. The last edition, the eighth, was completed in 1935. The first volume of the ninth, A to Enzyme, appeared in 1992. Since then, the Immortals have picked up the pace. The second volume, Éocène to Mappemonde, was published in 2000. The Immortals are an elite group, and even leading figures of French language or politics have been ignored. Through the years, Rousseau, Sartre, Balzac, Descartes, Diderot, Flaubert, Moliere, Proust, Verne, and Zola have all been shunned for one reason or another.

Today, l’Académie is at the center of a raging controversy over “Anglo-creep”—the rampant and unrestrained import of English terms into French. Accordingly, the Immortals have urged that walkman, software, and email be avoided, replaced by their equivalents—baladeur, logiciel, and courriel. They also waded into the controversy when the nation’s former Socialist prime minister, Lionel Jospin, insisted on calling women cabinet members la ministre, the Immortals maintaining that the masculine le ministre designate both sexes.

There is also a thought-provoking interview with one of its newer members further in the link. To me at least, it's a rearguard movement by elitists who've been overtaken by the times. French can adopt like any other language. Why not? However, the language police certainly have done their part in forestalling fertile adoption. Why can't French borrow from English and come up with something unique? It's the linguistic equivalent of Not Invented Here (NIH) syndrome. The important point here is that new terms are mostly developed spontaneously and adopted in a similar fashion instead of being dictated by a bunch of geezers.

While educators like yours truly require a certain standard for academic work, it's how people actually communicate with each other that sets possibilities for propagating a language instead of pronouncements from distant language police, methinks. So, to understand why English language trumps French, look no further than the difference between the Urban Dictionary and the Academie Francaise.

EuroPissants: Should Germany [!] Leave Eurozone?

♠ Posted by Emmanuel in Europe at 4/16/2012 10:14:00 AM

Having lived on and off the continent during the past few years, I am a follower and sometimes patron of various things European: Euratom. Euro currency. Eurofighter. Eurostar. Eurotunnel. Eurotrash. Not wanting to be left behind in all this naming fun, I've come up with the EuroPalin and EuroNasty. Today, dear friends, I must indulge your patience as we consider yet another term as indicated in the post title. You see, it is not enough to acknowledge that the PIIGS economies are the weak ones in the EMU. Rather, gaping current account and budget deficits coupled with general uncompetitiveness bedevils more than Portugal, Ireland, Italy and Spain. That's the unfortunate truth.

Conventional thinking, reinforced by brainless "reality show" fare in the popular consciousness, suggests that the solution lies in eliminating the weakest link(s): We vote you off the island, Greece. You're fired, Portugal, and so on and so forth. This sort of logic dominates the thinking of those who believe that all that will remain in the EMU are a small cotorie of muscular economies alike Germany and the Benelux states.

Well guess again. Michael Sivy over at the TIME displays fresh thinking by suggesting that it's Germany which should leave the Eurozone, pronto. The logic is again that Germany's overwhelming competitiveness buoys the single currency and makes the rest uncompetitive. It's an argument favouring the good of many (most Eurozone countries) against the few (German and a few others). Given the Germans' dislike of significant devaluation, it may be better for them to pursue this objective in a national context away from those desperate enough to benefit from it. After arguing that little girlie man economies leaving the Eurozone will be worse for them than staying in, Sivy proffers his novel solution:

By contrast, if Germany were the one to leave, the euro would be the currency that falls in value, relative to Germany’s new national currency and also to the dollar. The weaker European countries would get to keep the euro but still get the devaluation they need, which would reduce their labor costs far less painfully than through wage cuts. In addition, the value of their outstanding debt would decline along with the value of the euro, and they would be more likely to be able to make payments on that debt and avoid defaulting.

The standard argument against this solution is that as the value of euro-denominated debt falls along with the euro, banks in many countries would have big losses on bonds they own. But losses from falling bond prices are less disruptive than sudden defaults. And the fact is that those losses have really already occurred, they just haven’t been acknowledged. The goal at this point is not so much to prevent losses, but to find a way for banks and other international financial institutions to absorb their losses without triggering sudden bank failures or a global financial crisis. In short, it’s not about the money, it’s about stability. And for once, it may be easier to maintain order without the help of Germany.

In a way it's positive reinforcement for boorish behaviour in forming the EuroPissants, but there you are.

Finally, you may be thinking: Can a group of weak-kneed, overindebted and devaluation-loving states secure continued existence? Why, yes of course. Check out that lame-o republic called "The United States of America."

Pope 1, Obama 0: LatAm United vs Cuba Embargo

♠ Posted by Emmanuel in Latin America at 4/15/2012 06:42:00 PM

I tell you the truth, whatever you bind on earth will be bound in heaven, and whatever you loose on earth will be loosed in heaven - Mateo 18:18

Here's yet another example of how the gringos are unwelcome in their own backyard: A few weeks ago, I discussed the skillful diplomacy the Vatican has conducted over the years with the brothers Castro, culminating in Pope Benedict XVI's open-air mass attended by hundreds of thousands in late March. This is the same Fidel Castro, let it not be forgotten, who jailed (or worse) countless Catholic priests. But His emissary has loosed the chains in dealing with Cuba, even denouncing the antiquated US embargo on the island nation. As Cuba appears poised to re-enter the mainstream of the global community, then, there remains that significant obstacle--as if the Cold War never ended.

By contrast, a still very influential coterie of Cuban-Americans refuses to change hardline attitudes towards Cuba. In turn, their policy influence has ensured that folks like one Barack Obama must carry on the same old tune. So, while the media has had a tawdry fixation on the whoring of Secret Service agents, I have been more captivated by the wretched reception Obama has received at the Americas Summit. The real story with geopolitical significance is that, while seeking to drum up commerce, what Obama has actually reaped is nonstop criticism over Cuba. Even the more US-friendly Colombian hosts hate their treatment of Cuba:

Latin America's militant opposition to the decades-old U.S. isolation of communist Cuba put more pressure on President Barack Obama at the Americas Summit on Sunday and threatened to sink a final declaration...

For the first time, conservative U.S-allied nations like Colombia are throwing their weight behind the traditional demand of leftist governments that Cuba be in the next meeting of the Organization of American States (OAS).

Diplomats said the dispute could block the final declaration planned for Sunday at the closing of the meeting, and originally intended as a hemispheric show of unity."The isolation, the embargo, the indifference, looking the other way, have been ineffective," summit host and Colombian President Juan Manuel Santos said of the Cuba issue.

There may not even be another representative Organization of American States (OAS) summit if the US does not change its ways. They promised redemption for Cuba but have no delivered. Already, the more left-leaning nations vow to boycott OAS events unless Cuba is given representation (it bears remembering who came up with the OAS in the first place):

Ecuador's President Rafael Correa boycotted the meeting over Cuba, and fellow leftist Daniel Ortega of Nicaragua also stayed at home. The leftist ALBA bloc of nations - including Venezuela, Ecuador, Bolivia, Nicaragua and some Caribbean nations - said they will not attend future summits without Cuba's presence.

So it has come down to this. The Monroe Doctrine folks are so washed up nowadays that they can't even cajole their neighbours into inking a declaration that does not mention Cuba. Overall, the trend seems to be of the Anglophone US and Canada splintering off from the Latin American nations in regional diplomacy. That is, the real gathering of the Americas may no longer include those presumptuous to name themselves and their country after two vast continents inhabited by others with clearly diverse cultures and opinions.

If you can't even pacify a rebellion against US-organized events in your own backyard, what chance do you have elsewhere? Don't forget either, dear heathens, that it's His will.

I Knew It: 61% of Treasuries Purchased by the Fed

♠ Posted by Emmanuel in Americana,Cheneynomics at 4/12/2012 09:08:00 AM

What do you get when you cross the soppy Bushite Lee Greenwood with Obama's pastor? For one thing, you get a more accurate (financial) portrayal of the current state of that benighted land:

I'm cowed to be an American
Where at last I know I'm unfree
And I won't forget Uncle Ben
Who sold me into debt slavery

You can modify the rest of the lyrics accordingly--especially with Jeremiah Wright's trademark catchphrase replacing the title of the Greenwood tune. Anyway, this lyrical reassessment was brought about by a TIME feature I read recently that revealed the lie behind the "deficit's don't matter because US borrowing rates are so low" favoured by assorted (and rather ignorant) USA #1-style cheerleaders who inhabit the blogosphere.

As it turns out, the Federal Reserve flow of funds report for the entire year of 2011 reveals how "strong" demand is in the "market" for US treasuries. With 61% of Treasury purchases accounted for by Federal Reserve buying, both terms in quotation marks are cast in doubt. Yes, we know that open market purchases of treasuries are the result of policy decisions. But no, we did not know the cumulative extent of these purchases viewed in annual terms.

The proper analogy is one I made before: It's like calling your kid a "great salesman" after setting up a lemonade stand....only for the rest to find out that nearly two-thirds of all his "sales" came from you. So it is when monetary authorities justify currently bedraggled American finances via some variation on the "deficits don't matter because US borrowing rates are so low."

The questions I would like to see answered are following:

(1) If demand from foreigners for Treasuries is so great anyway since the US is providing a "safe haven" through "liquidity services," why is there a need for another arm of government to undertake such large-scale purchases? Why make the state do what the market would do by itself?

(2) Related to (1), there is also a concern about bloating the balance sheet of the Fed. Why needlessly do so if others would willingly lap up these securities?

(3) Lastly, would rates be this low if the Bernanke Fed deemed it unnecessary to make purchases on this scale?

The upshot is that they are intervening so heavily because they know the market, left to its devices, will not likely depress Treasury yields to a similar extent. The market-clearing price is, in all likelihood, significantly higher. The unprecedented expansion of public debt is thus matched by the unprecedented gaming of the market for these securities. The corollary to unparalleled indebtedness is unparalleled subvention of market forces. There's no need for Obama's pastor to damn America in speech when you have monetary authorities doing so in deed. The latter is certainly worse.

I guess the joke's on you, factually challenged America #1 cheerleaders, for nobody's quite as interested in your dollar-denominated detritus than yourselves. On my part and the rest of us who don't support your folly, you're more than welcome to it.

Developmental Authoritarianism: Burma's Turn?

♠ Posted by Emmanuel in Southeast Asia at 4/10/2012 01:18:00 PM

There's an interesting brace of articles [1, 2] from the Financial Times concerning Myanmar AKA Burma opening up to the rest of the world once again. Following Vietnam and China before that, Burma appears to be loosening up to the extent that it can profit from participation in the world economy. Ironically given the general goal of authoritarian development Myanmar's junta wants to promote, a major impetus for Burma right now is to avoid becoming too dependent on China. While the PRC remains Burma's investor of last resort with all sorts of mostly energy-related projects going on there, the junta tired of China exploiting its pariah status to obtain the best deal possible...for China, that is.

Or so these articles suggest. I remain convinced that Burma normalizing its relations with everyone else will likely culiminate in ASEAN giving it the stamp of approval by (finally) allowing it to take up the ASEAN rotating chairmanship in 2014. Surely, Myanmar has already done much to see to it that foreign sanctions against Burma will be lifted. Mainly to appease the pro-democracy crowd, Aung San Suu Kyi and her fellow National League for Democracy (NLD) colleagues have been allowed to run in by-elections and will now attend parliament. Given their overwhelming victory, it suggests the 2010 general elections where the NLD did not participate coupled with the by-elections gave the generals the best of both worlds. That is, they maintained their huge majority while subsequently giving enough of an impression of a turn to democracy so that longstanding US and EU sanctions will be much diluted.

The upshot is that Myanmar will likely be on its best behaviour until the end of 2014 when its ASEAN chairmanship--assuming it gets this designation--terminates. Acceptance by its regional peers would mean a lot. After that, however, all bets may once again be off. For instance, will they use means both fair and foul to continue having a military-backed parliamentary majority? The 2012 "free elections show" may be a transitory thing to gain Western favour. To its credit, Myanmar does recognize that these Western powers are particularly keen in this day and age to rediscover Myanmar's vast resources.

Meanwhile, the military lurks in the background--as it has for decades now.

EuroNasty II: Carbon Taxes on Maritime Transport?

♠ Posted by Emmanuel in China,Development,Environment,Europe,Trade at 4/09/2012 10:26:00 AM

[NOTE: Out of curiosity, I Googled "euronasty" and was shocked, just shocked at the search results! As I've said before, the IPE Zone is a family-oriented site.] There has already been much controversy over the European Union beginning to levy carbon taxes on air transport. In particular, their application to foreign carriers makes them complain that the EU regulation constitutes extraterritoriality insofar as (1) obviously, they aren't European carriers and (2) "taxable" miles are those incurred not just within EU airspace but for the entire journey. So far the EU has avoided contestation of the legality of these carbon taxes--probably because there is no discrimination between EU-based and foreign carriers.

That said, these carbon taxes are tremendously unpopular, especially among the Americans and the Chinese. The latter have supposedly even told their airlines not to buy from Airbus to "punish" the EU. They've even been instructed not to pay these taxes. Well, well, well: guess what? Other developing countries are also up in arms against the EU's levies. What's more, it seems the EU authorities aren't nearly quite done losing friends and offending people. In a recent newsletter sent to me by the South Centre, the Europeans appear keen on extending these taxes to shipborne transport, which would obviously affect a lot more merchandise trade if passed:

On 21 February 2012, the EU Council of economic and finance ministers adopted conclusions that included one on aviation and maritime carbon taxes. The Council of Ministers reiterates that "the carbon pricing of global aviation and maritime transportation would generate the necessary price signal to efficiently achieve more emission reductions from these sectors and that carbon pricing of global aviation and maritime transportation have as well the potential to generate large financial flows."

The Council invites "the (European) Commission to prepare a reflection paper by June (2012) on carbon pricing of global aviation and maritime transportation taking into account the developments in IMO (International Maritime Organisation) and ICAO (International Civil Aviation Organisation) and previous work by AGF (UN Secretary-General's High Level Panel on Climate Change Financing) and by the World Bank and other international organisations for the G20." It also stressed "the need of taking into account national budgetary rules and the principles and provisions of the UNFCCC (UN Framework Convention on Climate Change) in the use of potential revenue".

As before, China is at the forefront of countries sounding the alarm. Lest you think that American hypocrisy is all we talk about here in the IPE Zone, what we have now is a clear case of Chinese hypocrisy. When it comes to the infamous maritime territorial disputes with its neighbours concerning the South China Sea, the PRC staunchly refuses to "multilateralize" the issue where multilateral fora can help negate its overwhelming power over Southeast Asian nations. However, when it comes to carbon emissions, China is now calling for the EU to, ahem, "multilateralize" this issue to rein in European power which it believes the EU is wielding unilaterally.

Perhaps the Chinese don't perceive their own inconsistencies, but here's what it's worth in the environmental domain. Aside from not bringing up maritime carbon taxes in appropriate multilateral fora, we return to the complaint about the blanket application of such taxes going against the principle of common but differentiated responsibilities for LDCs which still need to develop and have less technical capacity for climate mitigation. Remember too that China--the world's largest merchandise exporter--has the EU for its largest trading partner. Hence, the sheer amount of trade these taxes would affect given that most Chinese goods come to the Occident by sea is...substantial:

Though the EU Council has called for a "reflection paper" at this stage, there were already critical reactions to this move in China, which is one of the vocal opponents to the manner in which such mandatory taxes are determined even though there is a need to address greenhouse gases emissions in these sectors. Objections centre on the unilateral and mandatory nature of the EU action even while discussions continue in the IMO and ICAO, the two global organisations responsible for such issues.

Critics also raise the issue of common but differentiated responsibilities that underpin the UNFCCC, arguing that since climate change is the result of the accumulated greenhouse gases emissions of developed countries over the past two centuries, it is not equitable to impose the same level of burden on developing and developed countries (in this case the payment of carbon taxes in the aviation and maritime sectors).

I generally understand what the Europeans are trying to achieve. By leading a movement to applying carbon taxes, the EU hopes to ratchet up environmental regulation worldwide. I call it seeking the California-effect globally. In the US, the strictest emissions and safety regulations emanate from California, and car manufacturers just make all their vehicles meet California standards rather than make different models for one state and all the rest. However, there are indeed questions of fairness that China brings up which are legitimate alike extraterritoriality and CBD.

Again, the honest truth is that Mother Nature could care less about artificial distinctions humans make between developed and developing nations. That is, carbon emissions are a shared externality to economic activity.

Palace Coup? World Bank Vets Pick Okonjo-Iweala

♠ Posted by Emmanuel in Africa,Bretton Woods Twins,Development,Gender Equality at 4/06/2012 12:57:00 PM

News is becoming sparser as most of the Christian world slows for the Easter holidays. However, in the run-up to the selection of the next World Bank president which should happen in a fortnight or so, we've had ringing endorsements of Nigerian Finance Minister Ngozi Okonjo-Iweala. (See a previous post for further ruminations.) We begin with an interesting counterblast to the current climate of economist-phobia at development institutions post global financial crisis. While it may be trendy to put non-economists at these institutions, the Economist (surprise!) slams this trend in endorsing her as the best candidate for the job:

Okonjo-Iweala is an orthodox economist, which many will hold against her. But if there is one thing the world has discovered about poverty reduction in the past 15 years, it is that development is not something rich countries do to poor ones. It is something poor countries manage for themselves, mainly by the sort of policies that Ms Okonjo-Iweala has pursued with some success in Nigeria.

While I am nowhere near as partial to economists as a publication dedicated to them in name, I did enjoy the insinuation that the United States which encouraged World Bank lenders to avoid corruption was doing so by choosing its favoured candidate to yet again fill a top (international) job.

Meanwhile, the Financial Times seconded the motion, accentuating the positives of extensive work at the World Bank:

Its new leader should have a command of macroeconomics, the respect of leaders of both the funding and the funded countries, and the management skills to implement his or her vision. These requirements make Ms Okonjo-Iweala the best person for the role.

Having served as managing director under outgoing World Bank president, Robert Zoellick, she also has a unique knowledge of how the institution works. While one risk could be the temptation not to challenge the status quo, she might find it easier than other candidates to gain the respect of staff and build on Mr Zoellick’s legacy.

More importantly for me, however, is that many World Bank veterans have come out in a strong show of support for Okonjo-Iweala. Lest you think that its employees don't matter, remember how the Ameriscum Paul Wolfowitz was eased out as World Bank president even during the Bush administration. From the Vanguard of Nigeria:

As the World Bank gets set to interview the three candidates vying for its presidency from April 9-11 before announcing its decision the following week, a group of former World Bank officials, including one-time chief economist, Francois Bourguignon, said it supported Nigerian Finance Minister, Dr Ngozi Okonjo-Iweala’s candidacy to become the lender’s president even as Governor of Central Bank of Nigeria, Mallam Sanusi Lamido Sanusi said Nigeria’s nominee was the best candidate for World Bank top job.

The 39 former managers, in a letter to the bank’s members, cited Okonjo-Iweala’s “deep experience in international and national issues of economic management” and said she had the ability to increase the bank’s effectiveness. Okonjo-Iweala, who was a managing director at the bank until last August, “would hit the ground running and get things done from the start,” the letter said.

According to the former World Bank officials, “challenges for the future president range from international fundraising to brokering agreements on global issues and while all the three presidency candidates, including former Colombian Finance Minister Jose Antonio Ocampo, have strong qualifications, Okonjo-Iweala’s skills cover the full spectrum of criteria. Uri Dadush, a former World Bank director of policy and one of the 39 signatories, provided a copy of the letter.

Before concluding I should also point out that an assortment of heterodox economists (including the LSE's own Robert Wade)--many from the Global South besides--signed on to a similar petition for the Colombian candidate Jose Antonio-Ocampo. Although they're both long shots given the history of the institution in question, Okonjo-Iweala is more of an insider to it and Ocampo an outsider.

Still, the IPE Zone comes down in favour of Okonjo-Iweala if previous merit is the criteria. Nevertheless, what's obviously fascinating about the succession race is that it not only pits vested Western interests against rising ones from the Global South but it is also a trial of sorts for mainstream economics' place in development practice. Go ask Jagdish Bhagwati.

A Parisian in America: Comic Stylings of IMF's Lagarde

♠ Posted by Emmanuel in IMF at 4/04/2012 11:58:00 AM

This will be short and unsweet as it demonstrates that you do not have to go very far to observe the mind-boggling ludicrousness of the world economy. My homepage ever since I hopped into cyberspace in 1994, Yahoo! News, is carrying an Agence-France Presse clipping about how IMF Managing Director Christine Lagarde is now calling on the United States to contribute more to the IMF, especially to ensure that the European debt crisis does not spill over to America.

Given that the United States is the world's most superindebted nation, with a national debt over 100% of its GDP at $15.62 trillion and rising annually at a trillion-dollar-plus rate, it's reminiscent of cadging a bankrupt. And a haughty bankrupt at that who would rather not fulfil its international obligations despite hosting the institution. Call it Yankee UN disease. With US elections coming up, no politicians wants to be seen adding to American fiscal malaise:

But her comments will be anathema to politicians in Washington, as the country hurtles toward elections this November. US officials, including Treasury Secretary Timothy Geithner, have for months trod a thin line between supporting the IMF's efforts to bolster its resources and actually kicking in some more cash. Washington has yet to ratify 2010 reforms which would see it send $63 billion more to the IMF's coffers, under a new quota agreement.

With the United States itself mired in high levels of debt, increasing IMF funding or shipping tens of billions of dollars abroad to help Europe could be tantamount to political suicide.

The corresponding press release on the IMF website is an odd mix of warning about the US about its dire debt situation while at the same time cautioning it about reining in spending at the current time (and asking for IMF funding in the meantime):

On fiscal policy, she warned that “a global undifferentiated rush to austerity will prove self defeating,” and that “countries like the United States with low costs of borrowing should not move too quickly.” But she also cautioned about complacency regarding U.S. public debt, and urged a stronger push to curb the growth of entitlement spending and raise more revenue. More action is also needed in the United States to ease the burden of household debt, which is holding back the recovery.

This returns me to my earlier criticism of this "stimulate now, consolidate later" approach insofar as the US federal budget has not fallen year-on-year since 1965! Once America goes on a spending binge, it will most likely stay on it. So, there is little reason to expect a major diminution in US deficits in the near future given these inertia and snowball effects. But, don't let that stop Lagarde:

She stressed that for the IMF to continue to be effective, it needed more financial resources. “Now that the Europeans have moved first with their firewall, the time has come to increase our firepower,” she said. The IMF is a good investment for all its 187 member countries, including the United States, she said, adding that no member country has ever lost money by contributing to IMF resources.

Given that she made her name at the US law firm Baker & Mackenzie, it's no surprise that she has no distaste for asking for money unlike most other Europeans. Still, the high comedy of whom she is approaching is evident. Truly, it's the global neighbourhood equivalent of asking the long-ago millionaire but now hermit-living-in-genteel-poverty for lots of money.

Not gonna happen.

Got Fission? Debating Nukes 4 Development

♠ Posted by Emmanuel at 4/02/2012 09:56:00 AM

Our colleagues over at the Bulletin of the Atomic Scientists sent me a notice about a timely new feature of theirs concerning LDCs considering the adoption of nuclear power (the Atomic Scientists maintain the well-known Doomsday Clock). The impetus for doing so should be familiar to everyone: insecure supplies of crude oil and global warming are concerns that we in the Global South share with our peers in developed nations. That said, traditional problematiques that have bedevilled nuclear power adoption have never really gone away.

Post-Fukushima, it makes many LDCs wonder if one of the world's most technologically savvy nations cannot guarantee nuclear safety, what more developing nations whose technical expertise and institutional capacity are far below those of Japan? Moreover, despite the comparatively dearer price of fossil fuel, nuclear power is hardly a cheap alternative. There's also the question of how to dispose of nuclear waste. Recall the recent fatal accident (albeit non-nuclear) at France's Marcoule site that raises similar questions about waste handling in what is probably the country most experienced at utilizing nuclear power.

That said, no fatalities in Japan and one "industrial accident" in France are hardly mass casualties in the history of humans generating power. Meanwhile, unfortunately far more common coal mining mishaps receive little attention because such incidents generally fail to capture the public imagination. Perhaps prematurely, the Economist has already deemed nuclear power "the dream that failed."

Or has it really? Given the number of LDCs considering nuclear power, that verdict may be premature:

Over 45 countries that do not use nuclear power today are seriously considering its adoption; of these, 37 are classified by the World Bank as developing nations. Moreover, four developing countries -- Bangladesh, Belarus, Turkey, and Vietnam -- are expected to begin construction on nuclear facilities over the upcoming years. This vast potential expansion in the developing world's nuclear capacity raises tricky questions about proliferation, plant safety, and cost. Below, Brazil's Gilberto Jannuzzi, Malaysia's Shahriman Lockman, and India's P.R. Kumaraswamy tackle the question: "How can nuclear power for economic development be made available to developing countries without increasing the risk of nuclear weapons proliferation?"

The contributors have interesting viewpoints concerning what I've termed "Nukes 4 Development." Kumaraswamy argues that Western nations have unfairly characterized LDCs pursuing nuclear power as potential nuclear weapons proliferators, all the while admitting that plant safety in the Global South is iffy. Meanwhile, Lockman is more concerned about the practicalities involved in using nuclear power such as multilateral mechanisms for addressing various stages in the fuel cycle and preventing this technology from getting into the wrong hands from LDCs. Lastly, Jannuzzi opines that there are more cost-effective alternatives to fuelling third world development.

Energy security--especially from nuclear power--is certainly an underresearched area in development studies that needs more attention. These contributions however help point us towards worthwhile research directions.

Money Talks? Bahrain GP Still On (Fortnight to Go)

♠ Posted by Emmanuel in Middle East,Sports at 4/01/2012 03:05:00 PM

Some have hunger games; Formula One has, well, anger races.

There has been a lot in the news about how the Formula One circus will not be disrupted this year alike how last year's Bahrain Grand Prix was postponed then finally cancelled due to the events of the so-called Arab Spring. During the Valentine's "Day of Rage" in 2011, the eyes of the world were also focused on Bahrain, where the al-Khalifa ruling family was not subsequently toppled. Despite more than a few observers questioning the human rights aspects of Bahrain's crowd control efforts up to the present time--another protester died this weekend--organizers say the race will go on.

The al-Khalifas view this year's race will proceed as one of national reconciliation, although I doubt the veracity of this claim since (a) fatal protests are still ongoing and (b) we haven't heard opposition figures extend their support for the race to go on. In any event, the billionaire F1 impresario Bernie Ecclestone believes that the race will be held on April 22, and team principals showed support at a Bahrain-sponsored event in London town. But, of course, it's exactly the same sort of thing he said last year...till the race was finally cancelled:

Formula 1 boss Bernie Ecclestone says he has no doubts about holding the Bahrain Grand Prix this year. The race was cancelled last year due to civil unrest and human rights groups have called for the race to be axed. Asked by BBC Sport if he had concerns about safety in Bahrain for himself and the teams, Ecclestone said: "Not at all. It's business as usual...I don't need any personal security but I'm sure whatever's necessary will be looked after."

Ecclestone's remarks come a day after the president of Bahrain's Automobile Federation, Sheikh Abdullah bin Isa Al Khalifa, said he did not believe security needed to be stepped up. Al Khalifa said he was "not worried at all" about the safety of those attending the race, while governing body the FIA expect the race to go ahead. A FIA spokesman said: "We welcome the spirit of reconciliation expressed by all parties and look forward to an exciting F1 race at the Bahrain International Circuit..."

Ecclestone was attending a lunch held in London by the race organisers, which was also attended by leading figures from the Red Bull, Williams, McLaren and Mercedes teams and the motorsport chief of tyre supplier Pirelli.

However, a human rights figure from Bahrain appeared on BBC HARDtalk stating the human rights record of the al-Khalifas puts hosting the race in question:

There are concerns that it could be a target for protesters as it is so closely tied to the Bahrain ruling family.Nabeel Rajab, president of the Bahrain Centre for Human Rights, told the BBC's HardTalk programme on Wednesday that the race should not be allowed to go ahead in the country because of Bahrain's human rights record. Rajab told BBC HARDtalk's Stephen Sackur: "It should stop, at least out of respect for the Formula 1 staff."

Although this race looks likely to go on, the image it presents to the rest of the world depending on what happens in the days leading up to it shall be interesting to watch. Remember, the kids ain't alright to some.