M Carey, J Bieber & Barack the Enviro-Fraud

♠ Posted by Emmanuel in ,, at 11/30/2012 10:25:00 AM
I was shopping at a discount store when I caught sight of an LED TV playing what I thought was a  music video of Mariah Carey's 1994 seasonal hit "All I Want for Christmas is You." I smiled as I recalled fond memories of a more innocent age. To my eyes at least, the young Mariah Carey was up there in the running for the most beautiful woman I ever saw'd. Imagine my surprise, then, when Justin Frickin' Bieber appeared in the video. As it turns out, this clip was Beiber's remake featuring the aforementioned Mariah Carey...made in 2011. What threw me off was the image of her all slinky alike in her youth. But alas, contrasting her mannequin-like image standing up with her true-to-life figure circa 2011 evident in the shots where she sits on the couch and frolics with the teen nuisance reveals the lie in the video. Nowadays she is rather...big. It was all just computer-generated trickery to make us think we were seeing the young Mariah Carey. How sad.

Like computer-generated imagery (CGI), American policy involves a lot of of fraud and fakery. Easily impressionable conservatives--among the world's b--chiest people--cast Obama as some sort of enviro-nut keen on destroying American free enterprise to save the world from (supposedly non-existent) climate change [1, 2, 3]. Nothing could be further from the truth as US environmental policy is not significantly improved from the unenlightened years of Bush the Younger.

I'd like these folks to explain this: say what you will about the pathetic US airline industry--and I've had much to say [1, 2, 3] about it from government bailouts to bouncer-sized cabin crew--but its ability to gain rents from the government is unprecedented. Never has so much been lost by so few who continue to inflict so much inconvenience and expense on the American people. A few months ago, I talked about how non-European carriers were infuriated by an EU law which was supposed to come into effect at the start of 2012 mandating that airlines pay a carbon tax based on the distance travelled by a jetliner landing at an EU airport. For instance, a flight from Atlanta to Frankfurt would be taxed over the entire distance of the trip and not just that over EU airspace. As it so happens, outrage by other nations was so great that the EU has punted on the issue, leaving implementation for a later date.Yet, Barack Obama, the so-called environmentally aware president, has (surprise!) safeguarded US airline interests ahead of schedule anyway:
The carbon fee bill was the first piece of legislation debated on the House floor after Congress returned from recess on November 13, and had been cleared by the Senate in September in a rare unanimous vote. President Barack Obama signed a bill on Tuesday shielding U.S. airlines from paying for each ton of carbon their planes emit flying into and out of Europe, despite a recent move by Europe to suspend its proposed measure for one year.
It directs the U.S. transportation secretary to shield U.S. airlines from Europe's carbon emissions trading scheme (ETS) if he or she deems it necessary. Lawyers have said the bill is unusual because it would prevent U.S. companies from complying with the laws of another country.
The argument that the United States and the airlines in question would prefer a global emissions scheme is a red herring. First, a global regime would be much harder to come by when you throw in traditional opponents of multilateral environmental schemes into the mix alike China. In other words, adding more veto players makes it more likely that no carbon scheme will come into effect. Second, even the United States' experience shows that it takes a leading state to raise national environmental standards. I am of course taking about California. It has traditionally had the highest standards in America concerning automobile emissions and mileage. Rather than sell California-only models, most automakers have instead made all cars sold in the USA conform to CA emissions regulations--improving nationwide standards in the process.

Or so the logic of EU flight taxes would go. It would have put pressure on manufacturers to lessen the emissions of jets. And, given that Europe is still a very major global market, there would have been pressure for other regions to adapt. But alas, it appears even the EU is conflicted on the matter. However, this much is clear: Barack the purported Enviro-Hero is nothing more than an Enviro-Fraud in the same way that Mariah Carey tries to pass herself off as her considerably slimmer former self. How sad.

Those Americans sure do like fraud and fakery. In fact, it's an industry called "Hollywood" that just so happens to love Obama partly for his dubious environmental poses.

Tim Geithner, I Dub Thee 'Pantywaist of Globalization'

♠ Posted by Emmanuel in , at 11/29/2012 08:32:00 AM
I've been meaning to make this post for four long, steenkin' years--and here it finally is. Perhaps Timmy thought he got away with stepping down soon as Treasury Secretary, but alas, I've pulled the trigger at the last moment. Anyway, this award is for continually being cowed in the China-bashing exchanges he finds himself in the middle of. In the past, I confess to poking fun at his responses to being made to perform admittedly unenviable tasks [1, 2]. How does piling on $1T in debt annually sound, for starters? My favourite, of course, being his repeated avocations of "strong dollar" policy despite continually asking China to revalue its currency. After all, wouldn't calling for the latter be a "strong yuan" policy that conversely implies a weak dollar is actually in effect?

At this point I guess we'll never know. Since moving from a strict peg to a managed float, the yuan has gained 25%. This doesn't mean that criticism has ceased, though. His soon-to-be former boss certainly kept harping on the currency issue throughout the recent US election. As it so happens, the US Senate requires the Treasury to report on the currency practices of America's trading partners. Eight opportunities have come to "do something" about China. Eight opportunities have gone to "do something" about China. As is usual during election years, Treasury delayed the release of the report scheduled for October for after the elections. And we got exactly the same thing:
The deadlines for the currency report to be issued are April 15 and Oct. 15 each year. But the Obama administration announced in October [this year] that it would delay the fall report until after meetings of finance ministers in early November. That decision also delayed the report until after the November election...

But Sen. Charles Schumer, a longtime Democratic Party critic of China's trade policies, criticized it. "This report all but admits China's currency is being manipulated but stops short of saying so explicitly," Schumer said in a statement. "It's time for the Obama administration to rip off the Band-aid and force China to play by the same rules as all other nations."
Not that the US will ever give up this issue:
Still, Treasury said the yuan remains significantly undervalued. It vowed to keep pressing Beijing to let the currency rise further to "level the playing field for American workers and businesses and support a strong, sustainable and balanced global economy."

The U.S. trade deficit with China reached $29.1 billion in September. It is running 6.8 percent ahead of last year's record pace. It has long been the largest U.S. trade gap with any one country.
Just as Susan Rice is the archetypal Ugly American, Tim Geithner is the archetypal Damp Squib in British-speak.Tim Geithner, for what will probably be the last IPE Zone post on you in your current capacity, I dub thee pantywaist of globalization.

God Save the Empire: UK's Canadian BoE Guv'nor

♠ Posted by Emmanuel in , at 11/28/2012 05:49:00 PM
 To be sure, outgoing Bank of England Governor Sir Mervyn King has a number of things going for him in my book. He was a longtime LSE professor before giving up his teaching position for a higher calling. He is also a long-suffering Aston Villa fan as our team battles to save itself from the ignominy of relegation. (Since the Premier League started, Aston Villa has never been demoted to the second division, but this year it's well and truly in the relegation zone.) That said, let's just say that during his time at the venerable BoE, many did not cotton up to his uppity ways. Philip Stephens of the FT had this to say about Merv's tenure:
Firstly, modernise. Sir Mervyn King has run the BoE as an 18th century monarch – a former Labour chancellor dubbed him the “Sun King”...It is time to say goodbye to the hordes of Threadneedle Street flunkeys in pink tailcoats and top hats, to open up the rarefied corridors of the governor’s office to the rest of the Bank, and to listen occasionally to colleagues. And no, you should not insist, as does Sir Mervyn, on being addressed as Mr Governor. 
To make a sporting analogy of the sort Merv would probably approve, I understand that Aston Villa has its faults despite having a storied history including winning a European championship way back in 1982. Still, you cannot live off days of wine and roses long past. Why should a team with such a large payroll be fighting for survival? In that way Mervyn King and his country are a lot like his team: trading on past glories and failing to keep up with the times alike the political currents that ebb and surge. In other words, the UK was due for a change.

And what a change it is! Mark Carney is the outgoing Bank of Canada governor--and a highly lauded one he is, being named one of the world's top central bankers in 2012. From his perspective, where else can you go having won the top accolade of your profession? Well I suppose he's done a Jose Mourinho and traded up to what I consider the third biggest show of them all after being Fed or ECB chairman: BoE governor...or guv'nor in British slang meaning "the boss."

It's all hand on deck now as Her Majesty has recognized the direness of Britain's economic situation. Will Britain suffer a downgrade from AAA alike the US and France? Heaven forbid. Searching all of her dominions (upon which the sun never set in days gone by), the selection committee chose...a Canadian. But wait, he does have a British wife and wishes to be naturalized besides:
Born in Canada, the 47-year-old intends to bring his British wife and four children to the UK and apply for citizenship. But he rejected the Treasury's stipulation that the new governor serve for a single eight-year term in favour of a contract that runs for only five years...

City analysts said that while they were surprised by the appointment, Canada's ability to survive the financial crash had boosted the status of its central bank boss. His promotion last year to head the G20 financial stability board, which is charged with forcing the world's major banks to agree and implement global standards, also elevated him to the top rank of financial regulators.

Carney said he had strong ties to the UK, not only through his wife's family, but also from working here for a decade and making contacts with UK businesses and financial institutions over recent years. He said: "I think I can play a constructive role in relaunching the institution in its new role in promoting financial stability and the regulation of financial services."
Actually, there is precedent for nationality-hopping among elite central bank governors. Carney's cohort in the 2012 best bankers in the world list is Stanley Fisher of Israel. Formerly, Fisher was first deputy managing director at the IMF--the #2 job at the IMF customarily taken by an American since the #1 was of course European. In 2005, however, he renounced his American citizenship (a really good idea) for an Israeli one (but the jury is still out on this move). 

At any rate,  it's the moment of truth for crown and country as the UK struggles to keep its place at the head of the sovereign credit ratings table and as its moribund economy continues to baulk. Kudos though to the selection committee--they could not have chosen a better person for the job. Godspeed, Mark Carney, and remember:

There will always be a Bank of England.

12.9% Inflation? Bah! Serbia's Soccer Club Bailouts

♠ Posted by Emmanuel in ,, at 11/27/2012 08:50:00 AM
Ladies and gentlemen, today I bring you the best act of "sticking it to the EU and the IMF" for 2012. So those Greeks may have caved in to the IMF-ECB-EU troika for the umpteenth time, but it appears those only aspiring to join the EU are keen on Sticking It To The Man. Having told the IMF to take the idea of central bank independence and shove it despite badly needing funds, the Serbian government has come up with yet another brilliantly over-the-top ploy sure to guarantee emergency lenders loathe it even more (if not to actually get it any money).

Let me first give you the IMF's 20 November depiction of Serbia as discussions continue for an "IMF-supported program":
The Serbian economy faces numerous challenges. The fiscal deficit has widened sharply in 2012 relative to the original budget and to last year’s level, and is unsustainably large. Public debt has also increased significantly. In addition, the external debt burden is high, inflation is volatile, and unemployment is elevated. Economic activity has significantly weakened amid a difficult global environment. GDP is expected to contract by about 2 percent this year, with a modest recovery expected next year. Inflation has risen sharply into double digits.
In other words, Serbia is broke. Awhile ago, I discussed how Serbian football coaches were its finest exports. Rest assured that Serbia is a proud footballing nation. Remember, Red Star Belgrade were European champions in the not-so-distant past. What the heck do these have to do with each other? Well, the Serbian government is apparently keen on addressing its widening fiscal deficit by--get this--bailing out its money-losing football teams [!] Aside from Red Star Belgrade, Partizan is also to receive a bailout:
The Serbian government will help refinance debt-ridden soccer giants Red Star and Partizan Belgrade and have appointed managers to temporarily run Red Star, the Balkan country's deputy Prime Minister Aleksandar Vucic said. Vucic had called a press conference in the early hours of Wednesday to announce the refinancing after Red Star chairman Vladan Lukic resigned on Tuesday saying he was exhausted from struggling with managing the club's debt of about 60 million euros ($76.27 million) and from a poor run of results...

"I spoke to the club's legends and leadership on the behalf of Serbia's government and we have agreed to (refinance) Red Star's and Partizan's debts because the state cannot allow these two clubs to go under," Vucic said. "The situation is so dire it's beyond comment and we will do what we can to help out Red Star and Partizan."
To me, this is beyond belief on any number of levels. If the situation is so dire for the Serbian government itself, why must it be compelled to bail out even less financially fit entities alike elite football clubs? And second, having annoyed the IMF already by curbing central bank independence, what does it say about being fiscally responsible when the state's chief priority is apparently the bailout of football clubs...and to appoint managers for the clubs besides?

This will be pretty hard to top in the offensive and frivolous waste of money department short of erecting gold-plated statues of Serbian war criminals, but you never know what will happen if I give them ideas...

Can the White People Have Mubarak Back Now?

♠ Posted by Emmanuel in , at 11/26/2012 06:01:00 AM
Sometime ago now, some wet-behind-the-ears white kid criticized me for suggesting that US policy in the Middle East could use improvement since it was contradictory and incoherent--especially when it came to using ICT as a diplomatic tool. Unsurprisingly, greenhorns like him took the events of Arab Spring as confirmation that we were in a whole new world of digitally revolutionized international relations--a dazzling place fogeys like myself never knew.
Hosni, Hosni - prolly better than Morsi, Morsi
However, unfolding events have demonstrated that there is no such thing. First they held runoff elections contested by those representing the old, old guard of Egyptian politics--a military man and a Muslim Brotherhood acolyte. The latter won, and has now gone about dismantling the judiciary after the lower house was done away with earlier. The end result? A potentially even more powerful executive than Mubarak ever was. The honest truth is that Arab Spring mobs were and remain a ragtag bunch, allowing those far better organized alike the Muslim Brotherhood to take full advantage. This outcome was utterly predictable if you've spent any time studying the ultimate beneficiaries from revolutions, and no amount of tweeting could have changed this turn of events. What a stunning blow for democracy.

And so it is that political turmoil once again engulfs Egypt as Morsi's power grabbing habits become apparent--especially to the West which has sought to curry favour with the Islamist by bankrolling his bankrupt government and more besides. For, not only is Egypt in social upheaval yet again, but it's well and truly broke. The realist in me asks that you consider what Egypt's Western benefactors have lost in the meantime:
  1. The US still provides military aid to Egypt to the tune of $1.3B annually. The big difference, of course, is that the Egyptian military is now at odds with the Islamist government, so the US of A essentially funding those who stand to benefit from destabilizing the government or getting rid of it altogether (Mubarak-style);
  2. Egypt pre-Arab Spring was in better economic condition than it is now. While not in the best of shape, it wasn't haemorrhaging foreign exchange reserves at a stunning pace due to capital flight, investment loss, and tourist non-arrivals either;
  3. So Mubarak was authoritarian, but Morsi is authoritarian and Islamic fundamentalist to boot--generally intolerant of other religions and prone to consolidating power amongst his own ranks. Moreover, what Mubarak was intolerant of was precisely the sort of fundamentalist intolerance Egypt has today;
  4. The trump card, of course, is that Mubarak wasn't chummy with Muslim Brotherhood offshoots Hamas--classified by most Western nations as a terrorist group--either.
I should be much less amused by all of this nonsense because it's ultimately the Egyptian people who are bearing the brunt of it, but let's get to the now-endangered IMF loan. The characteristically high-faluting announcement said that gaining buy-in from all sectors of society was a precondition for the loan:
Broad-based domestic and international support will be crucial for the successful implementation of the planned policies. The authorities intend to disseminate the contents of their economic program to a wide range of domestic stakeholders, which is welcome. The IMF, for its part, is stepping up to the challenge of supporting Egypt and its people by providing financial resources and technical assistance in the fiscal, financial, and statistical areas
Broad-based support now? You must be joking. Plus, Ahram Online now quotes the ever-familiar IMF sources to contradict the government's glib statement that Morsi's latest stunt will go unpunished:
A senior IMF official, who requested anonymity, told Ahram Online on Sunday that the development could bring into question the stability of state institutions and raise doubts that could delay the loan...

“I do not think the IMF will rescind its agreement, but if the situation in Egypt deteriorates it could suspend the loan,” Samir Radwan, former Egyptian finance minister, told Ahram Online. Radwan said the IMF executive board would be closely monitoring events in Egypt, including mass protests on Tuesday by those opposed to and in favour of President Morsi's recent move.
Morsi is a highly partisan sort who plays his redistributive game at the expense of the general welfare of the Egyptian people. "Internet Freedom" acolytes may even believe that since that's what their gospel truth--the tweets--say.  Meanwhile, the stock market has plunged nearly 10% in a single day. I guess there's no freedom here--or economic progress for that matter.

Though they would of course probably not admit this, it makes the white people wish Mubarak were still there, eh?

UPDATE 1: CFR bloggers have more on the news that Morsi is backtracking a bit on being able to override judicial decisions, but still, much remains up in the air. 

UPDATE 2: AP has a sobering analysis of the realpolitik the US must now play. To some extent, it is condoning Morsi's power grab.

Susan Rice, the New Archetypal Ugly American

♠ Posted by Emmanuel in at 11/26/2012 04:30:00 AM
Although years and years of economic stagnation have thinned their numbers somewhat, Ugly Americans are still rather plentiful--including policymakers who act internationally. How can you distinguish these folks? In general, they all share the following attitudes and behaviours:
  1. Think all that's needed to set the world right is for it to be more like the US;
  2. Boss people around as if they have some god-given right to as an American;
  3. Compel others to undertake difficult policies they themselves would not dare implement.
In the realm of political economy, you of course have Larry Summers. His post-Clinton administration rotundity simply adds weight to the ugliness of his policy prescriptions. Whereas he once asked poor countries to undergo liberalization, deregulation and privatization as a cure-all for whatever ails, when the US was faced with its own crisis he was indifferent to pursuing policies of deliberalization, reregulation and nationalization. As I've mentioned, all you need to know about the modern American electorate is that it is made up of a bunch of wusses, and their enablers are folks who exemplify their worst qualities.

All this brings me to the Ugly American du jour, Susan Rice.While she is rather better looking than a Larry Summers (hence not living down to the physically ugly part at least), she shares with him a penchant for all of the three distinguishing factors I've mentioned above. Until recently, she was the presumptive replacement for Hillary Clinton as US secretary of state in Obama's second term before things got...more exciting. Sure she has her fans, but her critics are legion. WaPo's Dana Milbank recently authored a hatchet job of an op-ed which underlines the fact that she has enemies not only amongst political correspondents but many in the Beltway crowd:
Even in a town that rewards sharp elbows and brusque personalities, Rice has managed to make an impressive array of enemies — on Capitol Hill, in Foggy Bottom and abroad. Particularly in comparison with the other person often mentioned for the job, Sen. John Kerry, she can be a most undiplomatic diplomat, and there likely aren’t enough Republican or Democratic votes in the Senate to confirm her.

Back when she was an assistant secretary of state during the Clinton administration, she appalled colleagues by flipping her middle finger at Richard Holbrooke during a meeting with senior staff at the State Department, according to witnesses. Colleagues talk of shouting matches and insults.
We then get to the crux of the matter as for cross-cultural communication: she has the tendency to use (rude) American colloquialisms while dealing with international peers. What's more, the classic American bullying style is very much evident in her interactions with peers on the UN Security Council:
Diplomats on the 15-nation U.N. Security Council privately complain of Rice's aggressive negotiating tactics, describing her with terms like "undiplomatic" and "sometimes rather rude." They attributed some blunt language to Rice - "this is crap," "let's kill this" or "this is bullshit."

"She's got a sort of a cowboy-ish attitude," one Western diplomat said. "She has a tendency to treat other countries as mere (U.S.) subsidiaries."
Hillary Clinton is Ms. Congeniality by comparison--various "Internet Freedom" and South China Sea hypocrisies aside. At any rate, if diplomacy has anything to do with securing national interests through being diplomatic, then Obama had better start looking elsewhere.

To use the kind of language she prefers, "What the f^*k are you playing at, Barack?"

The Honest Truth: ASEAN is Still Rather Lame

♠ Posted by Emmanuel in , at 11/23/2012 12:16:00 PM
World leaders--among them from ASEAN member countries, China, Japan and the US came, saw and whimpered in Phnom Penh, Cambodia. Among other things, differences within ASEAN itself are causing trouble coming up with a united policy on the matter of the South China Sea to negotiate with China. (Remember, the current ASEAN chair Cambodia is a longtime Chinese ally dating to the Khmer Rouge era and beyond. While it has no claims there, the general perception is that it's removing the issue from the ASEAN meeting agenda at China's behest.) Meanwhile, having previously accelerated the date of ASEAN economic integration including new accession countries Cambodia, Laos, Myanmar and Vietnam (CLMV) to 2015, our dear leaders are now moving it back--from the start of 2015 to the end of 2015. As usual in the political and economic realms, it's two steps forward, one step back.

Actually, we at LSE IDEAS came up with a publication prior to the massive ASEAN shindig that expressed caution about the influence of the association vis-a-vis China and the United States in shaping affairs in our region. It's kind of sad, but the honest truth is that ASEAN has some ways to go before it can match the agenda-setting capabilities of the would-be regional hegemons. Oh well...

At any rate, here is the LSE press blurb that pretty much sums up the current state of (regional) affairs:
As world leaders gather this week for the summit of the Association of Southeast Asian Nations (ASEAN) in Phnom Penh, an LSE report concludes that the group is ill equipped to defend its own interests against those of China and the US. The New Geopolitics of Southeast Asia, from LSE IDEAS, a centre for the study of international affairs, features articles by academics from LSE and leading universities in Singapore, Thailand, Indonesia and the Philippines.

Although ASEAN represents a market of over half a billion people, with a combined GDP growth currently double the global average, the report argues that its consensual approach to fostering regional economic integration leaves it unable to lead in the task of forging a regional strategy, meaning that Southeast Asian states risk becoming pawns in a geopolitical clash between the two superpowers. It therefore requires reform and renewal to enable it to serve as a third pole in the new geopolitics of Southeast Asia, with the capacity and authority to stand up to China and the US.

Regional member states need to empower ASEAN to represent their collective strategic interests, it explains. Failure to do so will mean surrendering the future of the region to the geopolitical interests of China and the US.
Contributions on the geopolitics of individual ASEAN nations in relation to China and the US vying for the affections of Southeast Asian nations are available online--including that of yours truly. There are also overarching commentaries from no less than the LSE founders themselves: Mick Cox, the guy who literally wrote the book on US foreign policy from a British perspective, weighs in.. So does Arne Westad, who recently authored a well-received book about China's global outreach from 1750 to date.

While ASEAN stands to gain much by standing together, don't except too much too fast. In the meantime, enjoy the contributions here that shed some light on the difficulties of ASEAN making a truly "Southeast Asian" stand in relation to the US and China.

Singapore is Least Emotional Nation; Mine Most

♠ Posted by Emmanuel in at 11/22/2012 10:55:00 AM
Are all Southeast Asians stereotypically taciturn? Well no. BusinessWeek has an interesting article entitled "Singapore Confronts an Emotion Deficit" that, in my opinion, provides some ammunition for Singaporeans-as-automatons stereotypes. Worker ants, to make an analogy. The data comes from an international poll from Gallup on how often respondents expressed emotion recently. The implication here of course is that Singapore has managed to get ahead by getting many of its citizens to carry on with a "stiff upper lip" in the British vernacular without raising much of a fuss. Oddly enough, Singapore is classed with many former Soviet Republics in this respect:

By contrast, the Singaporeans' fellow Southeast Asians the Filipinos--yours truly included--are supposedly the most emotional people in the world. We even manage to outdo those famously dramatic Latin Americans. Maybe that explains the melancholy subtitle of this blog--along with mood swings in blogging output depending on your perception:
All I can say is that Singaporeans were even more emotionless in previous iterations of this survey according to the Gallup writeup which found that only 30% showed emotion in 2011. Meanwhile, I guess the results lend more credence to Filipinos being more "Latinate" in character as opposed to "Confucian" owing to its Spanish colonial heritage. Then again, it is curious that nobody says the Indonesians are "Latinate" due to their history of Portugese colonization.

Meanwhile, all this talk makes me, well, emotional [sigh]. Excuse me while I take a breather from blogging for today...

Egypt Back to Poorhouse, to Get $4.8B From IMF

♠ Posted by Emmanuel in , at 11/21/2012 05:43:00 PM
It is no surprise to me that the IMF has just announced that Egypt is now in line to receive the $4.8B it asked for. It's geopolitics: the United States cannot really afford to lose Egypt as a mediator between Hamas and Israel as it has done in the past. Of course, matters are greatly complicated now by Egyptian leadership being drawn from the ranks of the Muslim Brotherhood which has inspired Hamas all these years. How will President Mohammad Morsi manage this tricky balancing act of maintaining face with Hamas and traditional Brotherhood constituencies while cottoning up to America Mubarak-style and enforcing IMF conditionalities? Remember, this is the guy who once described Israelis as "vampires." (Too much Twilight saga, eh, Morsi?)

Lest you think matters are done and dusted, remember that the $4.8B loan is not yet finalized but will require approval by the (Western-dominated) IMF Executive Board. Should Morsi @#$% up over the next few days by disclaiming conditionalities or siding strongly with Hamas--familiar Brotherhood feints--the money can easily be yanked away. Consider this "staff-level agreement" as a dangling hook Morsi must bite by toeing the American line on austerity, structural adjustment, and putting Hamas in its place. (Yes, this is global political economy.)

To me, several questions remain unresolved:
  1. How will Morsi broker peace with hardline Muslim Brotherhood figures of the sort he used to be before becoming the Egyptian president?
  2. How will the public react to a massive rollback of energy subsidies? Even without a (Muslim Brotherhood-dominated) parliament to take offence, the Egyptian public has acquired a taste for mass protests during the so-called Arab Spring that may yet upset Morsi's putative plans. 
  3. How will the Brotherhood-dominated government react to public demands that all conditionalities be disclosed? Among other things the statement mentions, Egypt will for instance be asked to implement a national VAT system--something which the US of course does not have, but there's obviously nothing new with Westerners asking others to make sacrifices they aren't willing to make. 
  4. Is financing totalling a said $14.5B from various "bilateral and multilateral partners" in addition to the $4.8B standby agreement enough to set Egypt on solid footing?
I remain pessimistic about the rest of the country willingly buying into another round of IMF lending when it has chafed at doing so in the past. Moreover, its repeated trips to the poorhouse--the latest one being the most recent--do not bode well for the future. There are far too many things up in the air for any reasonable commentator to say that it will end well. The Palestinian questions obscures an already cloudy picture.

UPDATE: Just as Morsi was basking in praise from Obama et al, he decides to increase presidential powers. I wonder how this figures into IMF pleas for a more inclusive and consultative government to raise support for economic reform!

Philippines & China: Joint Exploration, Not War

♠ Posted by Emmanuel in ,, at 11/20/2012 07:09:00 AM
The Philippines' industrialist du jour, Manny V. Pangilinan--he goes by his initials "MVP"--has long sought to partner with Chinese energy firms in exploring contested areas in the South China Sea. Say what you will about Pangilinan, but his move shows astuteness about the political sensitivities surrounding energy exploration there. If you will recall, the Philippine president was sufficiently annoyed by recent run-ins with the Chinese in the South China Sea as to officially rename the part of it claimed by Manila the "West Philippine Sea."

While China always issues fine words such as those spoken at the recently-concluded ASEAN summit about the matter, alike that other would-be regional domineer its actions do speak louder--and are often belligerent in the eyes of many Filipinos. Witness their abysmal public opinion of China. So, while Pangilinan does have his critics, his idea for the energy exploration unit of his vast group to partner with Chinese oil giant CNOOC makes business and political sense. As with any number of foreigners, Pangilinan is banking on leadership changes in the Communist Party to spur a joint exploration deal. I am somewhat doubtful, but one always hopes that the liberal idea of commercial opportunities trumping narrow national objectives holds even here:
Philex Petroleum Corp. is looking to start a fresh round of talks with China National Offshore Oil Corp. (CNOOC) for the development of the potentially resource-rich Recto Bank in Northwest Palawan. The listed upstream oil firm will wait for the response of its Chinese counterpart considering the recent leadership shakeup in the world’s second largest economy.

“Hopefully we can get some response from them with the change of leadership,” Philex Petroleum chairman Manuel V. Pangilinan said. In April, officials of Philex Petroleum conducted a meeting with government-owned CNOOC in Beijing.
That said, the mooted deal is best characterized as prospective in nature:
Pangilinan said there is no timeframe yet on the new round of talks considering the political transition in China. “I think you have to allow a bit of time because these are new leaders of China so it may take a bit of time to put their feet under the table so to speak,” Pangilinan said.
At best, it's killing two birds with one stone: the Philippines gains energy exploration expertise it does not necessarily have, while it also mitigates security risks emanating from this territorial conflict. Then again, joint exploration brings with it the connotation that the Philippines has a right to these areas China has long denied, so it's certainly a mixed prospect for all involved.

Is Canada Less Racist-Protectionist Than the US?

♠ Posted by Emmanuel in , at 11/20/2012 05:28:00 AM
It appears so. Recently, I posted on China's government-owned energy firm CNOOC attempting to buy Canada's Nexen and the political sensitivities that go with it. CNOOC is the same firm American lawmakers effectively discouraged from buying relatively pipsqueak American producer Unocal back in 2005 over dubious "national security" grounds. Just as you would expect, our Canadian friends appear to be more welcoming of the spirit of free trade in allowing the Chinese to buy Nexen.

Undoubtedly, there have been delays over largely the same objections, but the Canadians appear to be less racist-protectionist overall. However the latest word from the ever-popular "sources" is that the acquisition will be allowed to go through with the qualification that Canadian management and board representation remain substantial:
Negotiators for the Canadian government adopted many of the conditions requested by Alberta Premier Alison Redford last month, which include guarantees that at least 50 percent of Nexen’s board and management positions be held by Canadians, the two people said on condition they not be identified because negotiations are confidential...

Recent statements from Harper and federal cabinet ministers provide “favorable indications” Cnooc’s takeover of Nexen will soon be approved, as well as the separate bid the government is reviewing by Malaysia’s state-owned energy company for Calgary- based Progress Energy Resources Corp. (PRQ), said Kyle Preston, an oil and gas analyst at National Bank Financial Group in Calgary.

“I think we’re close,” [energy analyst Kyle] Preston said in a phone interview yesterday. “The government is looking at both the Cnooc-Nexen and the Progress-Petronas deals, which I think gives the appearance they’d like to make a decision on both at the same time and outline what the new framework is going to be for this net benefit test.”
The "net benefit test" simply holds that acquisition of  a Canadian firm will result in more benefits to the country than if foreign investment is shunned. I believe it's a fair criteria--and certainly one you would subscribe to if you believe in classic liberal principles about the benefits of trade and investment. Further, unlike certain racist-protectionist-isolationists, the Canadians have made it a priority to attract more foreign investment in the energy sector:
The Canadian government is reviewing the sale of Nexen under the country’s foreign-takeover law, which specifies transactions need to have a “net benefit” to the country in order to win approval. Canada extended its review of the deal for a second time on Nov. 2, setting the deadline to Dec. 10.
While Prime Minister Stephen Harper has called it a national priority to sell more of his country’s energy resources to Asia, he has said the Nexen sale raises “difficult policy questions” and the government will release a new policy framework on foreign investment when it completes the review of the Nexen takeover.
Why can't America be more like Canada--a progressive and prosperous place? The world would be so much better off if such were the case instead of having all these American hypocrites running the show. Be warned though: the archetypal racist-protectionist-isolationist Chuck Schumer (D-NY/Hades) says he will butt into this deal since Nexen also has US-based production facilities.

Americans sticking their noses into other people's business knows no bounds.

New PRC Leaders' Fully Convertible Yuan by 2015?

♠ Posted by Emmanuel in , at 11/19/2012 08:43:00 AM
With the new Chinese leadership coming in early next year with Premier-Elect Xi Jingping, leaders' promises to make the yuan (renminbi) fully convertible gain urgency given China's slowing economy. Last year Chinese officials told their EU counterparts that convertibility would come "by 2015." Lest you think that this was an offhand statement, market commentators have this year raised expectations of this coming true. Even the outgoing central bank governor indicates that his successor will make this move:
China’s central bank governor said convertibility will be the next step in the overhaul of the exchange-rate system as calls grow for the nation’s new leadership to deepen changes in the economy to sustain growth.“For the central bank, I think the next movement related to the yuan is going to be reform of convertibility,” Zhou Xiaochuan said at a conference in Beijing on Nov. 17. “We are going to realize it, we are moving in this direction, we need to go further, we will have some deregulation.” 
Interestingly enough, even party-favoured elites who've benefited from previous policies see the writing on the wall and accept that state banks lending large sums to state-owned corporations must be curbed. Capital account liberalization is but a part of a whole range of reforms to make China more market-oriented:
“Expectations are high” for change as government intervention, ranging from excessive regulation to rigid price controls, has become “unbearable” over the last couple of years, said Li Jiange, head of the country’s biggest investment bank and a vice chairman at the government-run company that holds stakes in state-owned lenders. Li, who spoke at a separate conference in Beijing on Nov. 17, is chairman of China International Capital Corp., and a vice chairman of Central Huijin Investment Co., a unit of the nation’s sovereign wealth fund.
Unless you listen exclusively to American politicians b*tch and whine about China, the RMB has already appreciated considerably in nominal terms--by about a third. Moreover, a recent HSBC poll of China-based firms also expects 33% of their transactions to be yuan-denominated come 2015. Hence, full convertibility is envisioned to be a natural progression in a sequence of steps towards China opening up to the world economically:
The yuan has appreciated about 33 percent against the dollar since the revaluation. The currency had its biggest weekly gain in a month in the five days through Nov. 16...“Interest rates should be liberalized, rates should be decided by market demand and supply,” [Justin Yifu] Lin, a former World Bank chief economist, said at a forum in Beijing yesterday. 

China’s financial system is dominated by large state-owned banks and the stock market and favors big “capital-intensive” players, said Lin, who is a professor at Peking University’s China Center for Economic Research. China must develop small, local banks to serve rural areas and small businesses, he said.
Lin was at the World Bank when it published a 448-page report in February titled China 2030, which outlined policies to help the nation sustain growth while avoiding the so-called middle-income trap, where expansion slows because of a failure to implement reforms needed to create a wealthy middle class. 
Actually, I do not expect full convertibility to be achieved by that date. Rather, significantly relaxed controls on the capital account may be adjudged as more practical and realistic by the PRC leadership come 2015. Moreover, there will likely be more market-determined rates of lending insofar as credit is extended more to SMEs and non-SOEs. In any event, I am in agreement that the RMB will not appreciate much more. Not only is China's growth slowing relatively speaking, but  more importantly it's certainly no longer as undervalued as it once was.

Things change, my dear.

F1 in Hickville: The United States Grand Prix

♠ Posted by Emmanuel in ,, at 11/18/2012 07:32:00 AM
Yee-haw! Y'all jus' be wonderin' 'bout how F1 landed in Texus thus weekund! The news agency Reuters is usually very reliable--especially when it comes to financial news. However, I take immense exception to this feature entitled "Motor racing-U.S. goes from F1 wasteland to land of promise" as the Austin Grand Prix is underway. You see, after years of absence, F1 is back in America, this time with a purpose-built race track. Most American racing series alike NASCAR just feature oval racing, so road courses appropriate for F1 have not been plentiful stateside. Again, F1 coming to America is being lauded as a breakthrough. (The same way soccer is always said to be on the brink of becoming a mainstream pro sport in the US.) However, the sad reality as F1 promoters should be aware of is that this is but the latest effort to hold a race there after years and years of failed attempts, Further on in the article it gets more honest:
Unable to find a permanent home, F1 has barnstormed its way around the U.S. with Austin becoming the 10th city to host the series after Sebring (Florida), Riverside (California), Watkins Glen (New York), Phoenix (Arizona), Dallas (Texas), Detroit (Michigan), Las Vegas (Nevada), Long Beach (California) and Indianapolis (Indiana).
Part of the problem stems from there being no top-class American driver in F1. Indeed, there hasn't been one since the legendary Mario Andretti won the F1 championship in 1978--a long time ago in a race series popular far, far, away from American shores. Just as Fernando Alonso brought an F1 craze to Spain and races to boot, so have they been looking for an American champion without success.

That said, F1 sponsors are keen on an event in America since some of if not their biggest markets are stateside:
Teams would not be against three stops in the U.S., which is the biggest market for many outfits, including Ferrari, Red Bull and Mercedes Benz. "It's crucial for Formula One to be a true world championship you've got to have a race in America, said Red Bull team boss Christian Horner. "For the first time ever we've got a circuit that's been specially made to bring out the best and showcase Formula One cars. "It's a crucial race for Red Bull. America is Red Bull's biggest market."
Even the ever-optimistic F1 ringleader Mr. Ecclestone does admit though that F1 is very, very low on the American pecking order of spectator sports:
Ecclestone admits he does not know why F1 is so popular in some countries yet virtually ignored by others, including the U.S. "It's a strange thing I don't no, no idea," said Ecclestone. "When I arrived here the guy at customs said, he had not heard of Formula One." In Texas, NASCAR is king and it is likely more eyeballs and television remotes will be focused on Homestead, Florida where the Chase championship will also be decided on Sunday.
Dear billionaire Bernie, I'll tell you why F1 is lame in America: there is no marquee American racing car driver. If you really want to break into this market, try paying more attention to American-born drivers coming up the ranks in various driving academies. In the meantime, you will get clobbered by the archetypal Jurassic race series, NASCAR, where the American primitives only adopted fuel injection at the start of 2012 [!!!] This when most passenger cars have had them for, what, a quarter of a century? Being outmoded has resulted in several NASCAR race fatalities, too, so I have to question why a slick, international product must be dumbed down--hicked and domesticated to meet American tastes.

Lastly, another reason Bernie Ecclestone should contemplate is that race time is non-standard for large TV audiences in Europe (and Asia more and more). I know, I know--many events in Asia and North America also have this issue, but at least they have much local drawing power locally as well as having the aforementioned growing TV audience in Asia. The same cannot be said for F1 in America, so I remain pessimistic about F1's chances of survival this time around.

UPDATE: Christian Sylt of Autoweek has the lowdown on the wacky political economy that brought this race to Texas. Its future apparently hinges on the state's willingness to keep forking over a hefty annual fee to Bernie and Co.

I [Heart] Hamas: Egypt, Terror & Asking IMF $4.8B

♠ Posted by Emmanuel in , at 11/16/2012 04:59:00 PM
It is widely accepted that international financial institutions (IFIs) the World Bank and IMF are still dominated by the US which effectively brought them to existence so many decades ago despite America's obviously diminished financial standing. In an interesting twist of geopolitics, here's one to think about: Hamas is classified by several Western governments as a terrorist group--including the United States. At the same time, Egypt's Muslim Brotherhood is closely linked to the group, and the current Islamist leadership has been at pains to show support as conflict once again breaks out between the Israelis and the Palestinians:
Egyptian Prime Minister Hisham Qandil made a historic visit to the Gaza Strip amid the biggest flare-up of violence in years between Israel and Hamas, underscoring the acute dilemma Egypt's new Islamist government faces as the stakes rise in the long-running conflict between the Israelis and Palestinians. Mr. Qandil arrived in Gaza on Friday morning to demonstrate his new government's clear policy break from Egypt's ousted, more pro-Israeli regime. He met with Hamas Prime Minister Ismail Haniyeh before visiting wounded civilians at a crowded Shifa Hospital in the Gaza Strip.

Mr. Qandil's high-profile visit to Gaza, unprecedented for such a senior Egyptian official, comes on the third day of exchanges of rocket fire and attacks between Hamas and Israel's military. He was ordered Thursday to lead a delegation to Gaza by Egypt's newly elected president, Mohammed Morsi. Hamas has fired hundreds of rockets into southern Israel, and even landed missiles on the outskirts of Israel's business center and largest city, Tel Aviv. Civil defense sirens again sounded on Friday afternoon in Tel Aviv, followed by what sounded like an explosion. It was unclear in the immediate aftermath exactly what caused the sound. 
There have already been hardline moves regarding Israel not bound to please the (white) man:
Egypt has already expelled the Israeli ambassador and frozen diplomatic ties with Israel, lifted some restrictions at Egypt's border crossing with the Gaza Strip and dispatched Mr. Qandil to Gaza City. Yet the crux of the problem for President Morsi and his Muslim Brotherhood party, which has deep ideological ties with Hamas, is that they being asked by their militant Palestinian allies to do much more, as they are at the helm of power in the Arab world's most populous and influential state after the fall of Mr. Mubarak during the Arab Spring uprisings in 2011. 
That's all well and good, but the crux of the matter is that Morsi must suck up with some diligence if he wants economic support for Egypt's crumbling economy:
Still, Mr. Morsi is dealing with monumental tasks at home. Jumpstarting Egypt's ailing economy and easing hostility among sizeable segments of the population, who are unsettled at the Muslim Brotherhood's sudden rise to power, are high on the priority list—and closely connected to the process of drafting a new constitution that is currently under way. Beyond domestic concerns, veering too close to Hamas threatens to alienate Israel's main international backers in the U.S. and Europe, both of which Egypt is counting on to help revive the economy with loans, investment and trade opportunities. 
The challenge as far as Morsi is concerned is to show his Islamist constituency that he is "standing up to the West" which is backing Israel strongly, all the while still being able to beg for the aforementioned $4.8B from the US-dominated IMF. It's a well nigh impossible balancing act. Mark my word, though: If Egypt shows more or less unequivocal support for Hamas, then the chances of Egypt obtaining IMF funding are size zero slim. $4.8B? Maybe they won't even lend $4.80 if sufficiently annoyed.

Even given America's bedraggled state, you simply don't bite the hand that tells others to feed. (See the previous "Allah and moolah" post for more on the tricky Egypt-IMF negotiations.)

UPDATE: Talk about Morsi's pro-Hamas leanings causing the US president no small amount of difficulties.

Foreign Private Investors Dump Treasuries in Sept

♠ Posted by Emmanuel in at 11/16/2012 03:36:00 PM
MarketWatch alerted me to the fact that foreign private investors dumped the most Treasuries ever in the month of September based on Treasury International Capital System (TICS) data:
Foreign investors were net sellers of $18.3 billion of Treasurys in September, the largest amount on record, Treasury Department data released Friday showed. Overall, foreign investors bought a net $17.9 billion of long-term U.S. securities in September, down sharply from the $78.5 billion purchased in the prior month. This includes Treasurys, mortgage-related bonds, corporate bonds and equities. According to the data, China-based investors slightly increased their holdings of U.S. Treasurys in the month. Foreigners made net purchases of $23.4 billion of U.S. equities in September, up from $6.1 billion in the prior month
The official data is here if you want to see it. Here's hoping that private foreigners get rid of more of this dollar-denominated detritus in the near-term as we head towards the fiscal cliff and the inevitable downgrades of US sovereign debt. That should teach those current account deficit lovers a thing or two.

US v China in FTAs: TPP, Meet the PRC's 'RCEP'

♠ Posted by Emmanuel in ,,, at 11/15/2012 11:24:00 AM
So the FTA battle in rejoined: In the run-up to the ASEAN summit this weekend, here's a feature about (surprise!) another FTA arrangement that should soon be negotiated in the Asia-Pacific. It is no big secret that the United States and China do not see eye to eye about who should take the leadership role in Asia-Pacific economic integration and what form it should take. That both would prefer being the leader in regional integration is obvious, but they too would configure a regional FTA differently. The US would design something favourable to its interests highlighting provisions on--inter alia--intellectual property, competition law, government procurement, labour and the environment. Meanwhile, China would prefer to emphasize all the abovementioned less and concentrate on the more straightforward matter of increasing trade volume.

So, while the US Trade Representative keeps talking up the Trans-Pacific Partnership (TPP) enlargement negotiations in the hopes that more countries would join in, China has now reacted lest it be frozen out of a pan-regional preferential trading arrangement. From the South China Morning Post, meet the Regional Comprehensive Economic Partnership or RCEP:
China will later this month enter talks to create an Asian free-trade bloc covering 28 per cent of world GDP, a reaction to U.S. progress in forming a Trans-Pacific Partnership that excludes China, South Korean Trade Minister Taeho Bark said on Monday.

The RCEP, or Regional Comprehensive Economic Partnership, will be comprised of the 10-nation ASEAN club plus six others: China, India, Japan, South Korea, Australia and New Zealand. Its launch is to be formally announced at the ASEAN summit in Phnom Penh later this month, with a goal of reaching a deal to lower trade barriers across the region by the end of 2015.
Notably, American leadership leaves it in no doubt who the target of TPP is (AKA those PRC trade cheats in so many words):
“We’re organising trade relations with countries other than China so that China starts feeling more pressure about meeting basic international standards,” Obama said in a presidential debate with Governor Mitt Romney two weeks ago.
Backed into a corner, China believes it has no choice but to revive the ASEAN+6. For geopolitical reasons, China would include Australia, New Zealand and India even if its preferred configuration pre-American meddling would be ASEAN+3 (the +3 being China, Japan and South Korea):
Bark said RCEP had grown out of a plan to launch trilateral trade talks between China, Japan and South Korea. Some ASEAN countries, worried about the trilateral initiative, pushed for a wider deal. “China’s position on this economic integration in East Asia was pushed by TPP,” Bark said in a lecture organised by the Centre for Trade and Economic Integration in Geneva.

“In the past, China didn’t want to have ASEAN plus six, they only wanted plus three. Japan preferred ASEAN plus six. China preferred anything without the United States,” he said. “I don’t know how much they hope to get but they want to do it because of the TPP.”
What is the incentive to join China's proposed FTA instead of America's expanded one? Well, aside from being less comprehensive, China is likely to offer attractive carve-outs and exemptions in sensitive industries alike agriculture:
But many developing country members might want to water down RCEP by asking for special treatment. South Korea will demand an exemption to protect its rice farmers, while Japan is also likely to want carve-outs for agriculture. If the signatories’ squeamishness at opening their markets does not devalue RCEP, they might be forced to lower their sights in any case to meet the three-year schedule. If so, RCEP could end up having little influence on regional trade.

The trilateral talks are still expected to go ahead, although the planned launch, originally set for the Phnom Penh summit, is likely to be postponed to later in the year due to a territorial dispute between China and Japan, Bark said.
 Go figure. Based on the principle of lowest common denominator, I think RCEP stands a greater chance of coming true than TPP. That said, China's goal of getting RCEP done by 2015 is certainly ambitious even if it's a less comprehensive deal than TPP no matter what the Chinese call it. Besides, it at least makes more geographic sense than the whole-hearted TPP. In a way, TPP is a fitting advocacy for the US at the current time: a centre-less FTA championed by a discombobulated nation.

PS: After making two posts now featuring their articles, I almost forgot to mention that Hong Kong's premier English-language daily the South China Morning Post is now ungated. You can only preview a number of articles in theory, but still. So, by all means, visit it for fine news features like the one excerpted above.

UPDATE 1: A clear advantage of RCEP is that all ASEAN member countries are on board already (alongside China, obviously). From the Chair's Statement from the 2011 meeting when Indonesia was the host, p. 13:
45. Recognizing the benefits of sound and sustainable economic relations with  partner countries, we reinforced  our commitment  to  maintain the centrality and proactive role of ASEAN in relation to external parties. We  welcome the ASEAN Framework for Regional Comprehensive Economic Partnership that establishes an ASEAN-led process by setting out  principles under which ASEAN will broaden and deepen its engagement with FTA/CEP partners and subsequently with other external economic partners towards a regional comprehensive economic partnership agreement. This agreement includes  trade  in  goods, trade in services, and  investment as well as other areas related to trade, investment and economic cooperation. We envisage that this partnership agreement will provide a framework under which ASEAN and its external partners can address trade and investment issues that may emerge in the future.
UPDATE 2 (Nov. 21): Lest you think I overstate the competition to sign up Southeast Asian nations to trade deals, the US has now inked a "U.S.-ASEAN Expanded Economic Engagement (E3) Initiative" that aims to smooth the way for non-TPP participants in ASEAN to join the Trans-Pacific Partnership. Or, that's how it should work out in theory according to the White House:
Furthermore, by working together on these E3 initiatives, many of which correspond to specific issues addressed in trade agreements, the United States and ASEAN will lay the groundwork for ASEAN countries to prepare to join high-standard trade agreements, such as the Trans-Pacific Partnership (TPP) agreement that the United States is currently negotiating with ten countries in Asia and the Western Hemisphere.  

How Scuderia Ferrari Improved a Hospital ICU [!]

♠ Posted by Emmanuel in , at 11/14/2012 01:59:00 PM
Longtime readers will know from my blog FAQs that I am most excited about the field of IPE borrowing from different social science disciplines and beyond--anthropology, human geography, neurology, sociology...even moral philosophy and theology. If you look past largely artificial disciplinary boundaries, you'll often find that others have unique insights of their own about the same phenomena you are investigating.

It was thus a pleasure for me to find out that the same sort of thing is happening in the hard (some would say "real") sciences. This may sound incredible, but a bunch of doctors were watching Formula One during their of time when they noted the speed and efficiency with which teams perform pits stops as all four tires are changed in a matter of seconds. Why not ask these experts how to remove inefficiencies in the operating room, they thought? Hence a unique kind of collaboration was born:
Great Ormond Street's head ICU doctor, Allan Goldman, and heart surgeon, Professor Martin Elliott, were watching a Formula One race in the hospital's staff common room having completed a 12-hour emergency transplant operation.  As a car pulled into the pit stop, they noted that a 20-member crew changed the car's tyres, filled it with fuel, cleared the air intakes and sent it off in seven seconds in a manner that was coordinated, efficient and disciplined.
Actually, the art has advanced so much that Ferrari archrivals McLaren set a record this year of a 2.31 second pit stop! These guys are good; these guys are fast. While F1 is perhaps much bigger money, in the overall scheme of things improving emergency health care is a far more important thing to so many people. So, they thought, why not ask the experts and invited F1 pit crews to study operations in an operating theatre to make improvements...
Recognising the similarities with the handover disciplines visible in the pit of a Formula One racing team, they invited the McLaren and Ferrari racing teams to work with them to examine how their processes could be more structured and effective.  They went out to the pits of the British Grand Prix, met Ferrari's technical managers at their base in Italy and invited some of them to come and observe their handovers at Great Ormond Street.

Professor Elliott feels the team enabled them to review what they did with a fresh pair of eyes: "They saw us operating on a solid table with the child under a heating or cooling blanket and all the vital connections to various bits of equipment, and then having to unplug everything and use a hand-operated ventilator as we took the patient out of the theatre, into the lift and along the corridor to intensive care.

"Their first thought was why didn't we do everything on a bed trolley that was equipped with everything we needed and didn't require disconnecting and reconnecting.  I pointed out that the manufacturer did not exist who would invest that sort of money in such a specialised product and that's when they started investigating human solutions and training methods to solve our problems."
And, fruitfully, there were observable methodological improvements as a result:
The input of the Formula One pit technicians resulted in a major restructuring of their patient handover from theatre to the ICU.  This involved adopting a new protocol, better training and rehearsals. The protocol outlined who should be the leader throughout the process (the anaesthetist), provided a step-by-step checklist covering each stage of the handover process and included a diagram of the patient surrounded by the staff so that everyone knew their exact position as well as their precise task...

Following the adoption of the protocol, an industrial psychologist monitored 27 operations and found that the number of technical errors and information handover mistakes had almost halved. The process is now being adapted to other areas of this hospital and others and the team want to examine how hospitals can learn from other high risk industries, including NASA and the Navy.
What more can you ask of interdisciplinary collaboration? The glamour of F1 rubs off on the medical profession, which in turn gains valuable insights on how to better provide health care in a pinch to those who need it most.  It's a win-win situation all around. And that is my feel-good story du jour. Have a nice day!

PS: Race aficionados will undoubtedly note that the Ferrari racing car above is the 2008 model, but do keep in mind that the collaboration mentioned here happened around that time.

Will US Honour Its WTO Obligations to Russia?

♠ Posted by Emmanuel in , at 11/13/2012 11:53:00 AM
To be honest, American hypocrisy over human rights is appalling. Not only are they fond of linking these issues to unrelated ones, but they also do not respect steps other countries have made to address them. You would also have expected Americans to clean up their act with respect to human rights violations of their own alike their Guantanamo Ghraibing activities, but they still continue with practices alike indefinite detention and drone strikes. Both of the latter have received deservedly withering criticism from former US President Jimmy Carter as blatant human rights violations.

Even with Russia acceding to the WTO, the US has so far failed to extend most-favoured nation status (MFN) over the USSR--not Russia, mind you--not allowing free emigration in the early seventies. It's antiquated geopolitics. Obviously, Russians have been able to go wherever they damn please since the collapse of the Iron Curtain. But, hypocritical American lawmakers have not done away with the Jackson-Vanik amendment yet. Worse, American lawmakers have made an issue about granting WTO MFN status on resolving another unrelated human rights issue to their satisfaction. The utter stupidity of this legislative move arises not only from maintaining vastly outmoded rules but also not honouring trade-related MFN due to all other WTO members. The US ambassador to Russia thus tries to do some damage control while being placed in a tight spot:
The Cold-War era Jackson-Vanik Amendment, which imposes trade restrictions on Russia, could be abolished by January 2013 as more and more US politicians realize the importance of this step, US Ambassador to Russia Michael McFaul said. “More and more people in the United States agree that this must be done,” McFaul said in an interview with Ekho Moskvy radio on Wednesday. “Let’s hope it will happen before January [2013]. However, there is still a big group of people who would like to link the scrapping of Jackson-Vanik issue with the adoption of the Magnitsky list,” the diplomat said.
This latest bout of incredulity began midyear when some American senators with nothing better to do thought of a ridiculous gambit:
In July, the United States Senate Finance Committee approved a bill linking the abolishment of the Jackson-Vanik Amendment and a measure aiming to punish Russian officials involved in the death of Russian lawyer Sergei Magnitsky. A probe into his death revealed that the lawyer, who was suffering from untreated pancreatitis and a heart condition, did not receive proper medical treatment in prison. Rights activists pointed to multiple violations of his rights during his arrest and in detention, including signs that he was beaten by prison guards hours before his death. Russia insists that the two issues must not be tied together.
At any rate, this week will see whether (a) the Magnitsky law supersedes the Jackson-Vanik agreement and (b) MFN status is granted to Russia. If worse comes to worst and MFN status is not granted, then Russia will have the right to slap tariffs on American products. In other words, Russian WTO accession would have actually worsened US-Russia trade relations due to inane lawmaking:
The House Rules Committee is scheduled to vote on a rule regarding H.R. 6156, “the Russia and Moldova Jackson-Vanik Repeal Act of 2012,” on Tuesday afternoon, with a vote to approve permanent normal trade relations (PNTR) with Russia expected later this week. The bill would then be sent to the Senate, where the Finance Committee approved a different version of the measure in July.

Farm organizations and business groups hoped Congress would have acted shortly after Russia joined the World Trade Organization three months ago. Under World Trade Organization (WTO) rules, Russia could raise tariffs on U.S. exports to Russia if Congress does not approve PNTR.
What appetite does the US have for a trade row that hurts US businesses too? While you hope trade creation occurs, remember that you're talking about a bunch of folks hellbent on flushing the US down the toilet of history with extreme prejudice--American lawmakers.

 November 17 UPDATE: It has come to pass that Jackson-Vanik will likely be dismantled at long last as the House has made a move to given Russia MFN status or PNTR in American trade lingo. However, as the bill moves to the Senate, the Magnitsky law has unfortunately been tied to it:
The bill, which the House approved 365 to 43 and which now goes to the Senate, did accomplish a goal that Russia has long sought. It repeals the Cold War-era Jackson-Vanik Amendment, which tied trade relations to the free immigration of persecuted religious minorities, principally Jews. Since the fall of the Soviet Union more than 20 years ago, Russia has had no exit restrictions, and the amendment has been a source of constant irritation...

 But the Magnitsky Act was tied to it. It requires the United States to place financial and visa restrictions on a list of officials associated with the torture and death, three years ago Friday, of Sergei Magnitsky, a whistleblower who uncovered a $230 million tax refund fraud. Russian officials have denounced the act as interference in domestic affairs.
So it's not quite the outcome the Russians were hoping for--or American exporters to Russia for that matter.

Barcelona FC & Pol Eco of Catalan Secession

♠ Posted by Emmanuel in , at 11/11/2012 01:52:00 PM
I have made a post recently about the interesting implications of Catalan secession from recession-hit Spain, but there's one aspect I have yet to cover that may be particularly important not only to sports fans. The all-conquering Spanish national football team has won the Euro competition two times on the trot in 2008 and 2012 in addition to the World Cup in 2010. Those are highly impressive and unprecedented feats, but remember too that many key players over the years have been Catalan alike Andres Iniesta, Cesc Fabregas, Sergio Busquets, Xavi, Gerard Pique and (latterly) Jordi Alba. Even now, there is conjecture on the Internet about Catalunya having been able to win Euro 2012 had it declared independence earlier.

Seemingly loose talk about Catalunyan independence aside, there is also tension between this region and the centre which spills over into sport. Historically, Barcelona FC has served as a rallying point not just for sports fans but for opposition to the repressive regime of Generalissimo Francisco Franco in his high pomp. As such, clashes with Barca arch-rival Real Madrid have served as a proxy war of sorts that continues to these post-Franco times:
Barca has been seen as a bastion of Catalan identity dating back to the three decades of dictatorship when Catalans could not openly speak, teach or publish in their native Catalan language. Barcelona writer Manuel Vazquez Montalban famously called the football team "Catalonia's unarmed symbolic army." 
Barca-Real Madrid matches have a nickname: "el clasico" — the classic — and they are one of the world's most-watched sporting events, seen by 400 million people in 30 countries. But local passions run high. In Spain, where football has deep political and cultural connotations, many see the clashes of Spain's most successful teams as a proxy battle between wealthy Catalonia and the central government in Madrid. If Barca is a symbol of Catalan nationalism, Real Madrid is an emblem of a unified Spain.
Make of that what you will, but the truth is that Barca's fan base is of course not just composed of Catalans, or even just independence-minded Catalans for that matter. Yes, there are vocal fans who regard cheering for the club and for secession as one in the same, but there are far broader issues. For instance, what league will Barca play in if it is not in Spain? Unlike, say, Monaco FC being allowed to play in the French football leagues (it is currently in the second division), the guaranteed acrimony of Catalan secession would probably militate against this possibility:
Perhaps not surprisingly this soccer behemoth has a massive fan base that stretches far beyond its home in the northeastern region of Catalonia, across Spain and beyond. About 1,500 supporter clubs are registered with Barcelona, the majority outside of Catalonia. 
But some non-Catalan fans are finding their emotional ties to the club coming under strain as Spain's economic crisis gives way to growing calls in Catalonia for independence. Nationalist fervor reached fever pitch during an Oct. 7 match against Real Madrid. Fans at Barcelona's 98,000-seater Camp Nou stadum held up cards to form the red-and-yellow striped flag of Catalonia and punctuated the air with calls for independence. 
Many Barcelona fans elsewhere were appalled. "Some of our members wouldn't be best pleased if Catalonia became independent," said Xavi Navarro, a 48-year-old web developer who heads the Barcelona supporters group, or 'penya', in Mostoles, a town on the outskirts of Madrid that also happens to be the birthplace of Real Madrid captain Iker Casillas. "You've got to remember that 95% of our members aren't Catalan," says Mr. Navarro, himself a Catalan. Francisco Carrasco Rivero, 53, a police officer in the Andalucian port of Malaga, 500 miles away from Barcelona, and head of another Barcelona penya, goes further. He says the club has already lost some support in Andalucia as a result of recently-heightened political tensions.
The notion that sports and politics are often inseparable has a 0% originality factor. That said, Catalunya's critics would, after all, question why a Spaniard would display allegiance to a "foreign" club:
Barcelona's non-Catalan supporters say they've long been in the cross-fire of Spanish nationalist politics and accused of supporting a "foreign" club. Now such animosity is on the rise, they say. "At almost every sporting arena we go to these days we're met with growing aggression from opposing fans due to the tensions that have accumulated and which have nothing to do with our views," says Mr. Navarro, the web developer. 
Barcelona's non-Catalan fans sometimes get it from both sides, he adds. "A small section of Barcelona fans don't understand that Barcelona is a universal club and not just a Catalan club. The fact we speak Castilian [rather than Catalan] shouldn't detract from the fact we are standing up for Barcelona," he says. 
To paraphrase Robert Putnam, the battle for Catalan secession also has two (sporting) levels--the national one of Catalunya supplying so many top Spanish players who've brought home so much hardware in international competition, and the domestic one of Barca fandom being subject to debate as to the "Spanishness" of the club that will only reach an even higher pitch if the independence movement gains further steam. Appropriately enough, the overlap constitutes a win-set. But, for how much longer will it exist as we know it?

Flood Monitoring? There's a (Non-US) App for That

♠ Posted by Emmanuel in , at 11/09/2012 10:05:00 AM

Certain weather events reminded me of the tribute band Zepparella's remake above of Led Zeppelin's own cover of bluesman Memphis Minnie's "When the Levee Breaks." Robert Plant's powerful banshee wailing was remarkable insofar as he was, er, a man. So the impact is diminished even if you have an accomplished female singer. But, this tribute band exempted, little girlie man behaviour that doesn't rock is unfailingly common Stateside--which is especially evident after Hurricane Sandy.

Rotund, recliner-bound Yanks have a well-deserved reputation worldwide for wussy behaviour, thinking that what happens to them is somehow worse than what happens elsewhere. Whether it's financial crises and overreacting with a tsunami of stimulus that's worse than useless or even weather disturbances, it doesn't really matter. And so the endless news reports about climate Armageddon started to grate. Out of interest, I read the weather reports concerning this alleged climate Armageddon--and found out that the magnitude of Sandy was exaggeration of supremely American proportions. Over the course of the entire storm, the worst-affected areas experienced, at most, rainfall slightly over the double digits. To put matters into perspective, I myself experienced Typhoon Ondoy which dumped over thirteen inches of rain on Manila in six hours in 2009:
A record 13.43 inches of rain fell in Manila in the six hours between 8 a.m. and 2 p.m. local time, which is equivalent to about a month's worth of rain for the area. The enhanced rainfall over on the Manila-side of the island as the storm approached was because of an interaction between Ketsana's [the international name for Ondoy] circulation and the seasonal southwest monsoon.
As I said, storms in the Pacific are of a magnitude greater, making us wonder what the fuss was all about Stateside after a spot of rain. Some big deal. Actually, much damage in America owes to its decrepit infrastructure bettered by any number of ostensibly "third world" nations, but I digress.

So while the American whingers complain about minor, transient inconveniences alike a lack of water, electricity or petrol, people in the Pacific are actually doing something about preparing for such events. The boffins at my alma mater, the Ateneo de Manila Univeristy, have teamed up with the Philippines' major telecoms providers to develop an Android app that can help map out the magnitude of flooding in various locales:
Weather forecasting and disaster monitoring just got an upgrade as the mobile weather information app of the government's Project NOAH (Nationwide Operational Assessment of Hazards) has been expanded with another application."Flood Patrol," developed by the Ateneo Java Wireless Competency Center (AJWCC), allows people to report floods to Project NOAH.

"The application extends the flood monitoring and flood mapping service of Project Noah spearheaded by Dr. Mahar Lagmay by allowing people to report floods via the mobile phone and send it to NOAH for mapping," read a description of the project on Google Play. The Project NOAH app was earlier launched by the Department of Science and Technology (DOST) and Smart Communications Inc. It will be initially available for smartphones and tablets running Google's Android.
By all means, download the app and give it a whirl if you live in the Philippines and have a device running Android. My only qualification so far is that it would be better if they could use GPS functions to ensure that flooding at the reported location is accurate, and that photographic evidence matches accordingly. While I do appreciate that technological fixes cannot entirely mitigate the difficulties associated with storms of this magnitude, some folks are simply better prepared to deal with them than others. It is unfailingly common nowadays that the US--supposedly the world's most advanced nation--is left behind in practical mobile applications alike mobile banking and whatever else have you. In other words, my dear readers, "Angry Birds" won't save you from Sandy, as the "can't do" spirit reigns Statesnide.
Hopefully, though, those Yanks can catch up and use similar technologies. Rest assured that the rest of us are sick and tired of their apparently endless blathering about exceptionally unexceptional weather events when seen from a global perspective. So get out your cell phone for crying (like a wussy American) won't do you no good...when the levee breaks, you gotta whip out your app.