At what cost was China’s development miracle?

In the span of forty years the China performed a development miracle. It transformed itself from an agrarian afterthought to the world’s second largest economy. This was in spite of pervasive attitudes and policies that ran contrary to most Western economic thought. In as recent as 1980, the country’s official dictionary defined “individualism” as “the heart of the Bourgeois worldview, behavior that benefits oneself at the expense of others.” Analyzing how one person’s world went from rural farming to internet millions is a hard task. Distilling the thoughts and attitudes of a billion people and putting it in context of modern society is a seemingly impossible one. As I explain in my Age of Ambition review, Evan Osnos delivers the impossible. He answers the question, “At what cost was China’s development miracle?”

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Is Dwight Eisenhower Overrated, Underrated, or Properly Rated?

Eisenhower managed WW2, led an Ivy League University, became a beloved President, oversaw the rise of the American hegemony; all while carrying on an affair. Most historians rank him as one of the top 15 Presidents of all time, but the question remains: Is he Underrated, Overrated, or Properly Rated?

Childhood

David Dwight Eisenhower was born in Texas to pacifist Jehovah Witnesses, but grew up in Abilene, Kansas. Abilene is one of those towns that got its first paved street four years before WW1. I’d imagine today they have numerous DVD stores. His family was poor and his college prospects looked grim, but he was lucky enough to be represented by one of a handful of Senators who gave appointments to Military Schools on merit, not political connections. For basically every other state but Kansas, admission to the US Military schools operated like a aristocracy. At nineteen he forged his birth certificate and got an appointment to West Point.

Verdict: UNDERRATED

Time at WestPoint

Eisenhower was an average student, totally laudable. He graduated 61/164, which is less impressive when you realize West Point wasn’t what it is today. “How long are we going to continue preparing for the War of 1812?” General MacArthur asked when he assumed control of the school in 1919. What’s strange about Eisenhower’s college experience is how much of it seemingly revolved around sports. Nearly every biography makes a passing reference to his love for football and baseball. The thing is, he was terrible at them. He was one of those average players who made up for their athletic limitations with grit and intelligence. He couldn’t even make the Varsity team. Basically, the media’s perception of every white WR in NFL history.

Verdict: OVERRATED

Writer

Today, books by politicians are essentially 250 page-marketing campaigns. There’s really little of actual substance. They are just pages of pages of homespun tales vetted by publicists about their America. If the writer is Republican they use a title like Unintimidated or No Apology, which last I checked were previously reserved for movies staring Sylvester Stallone. If the writer is a Democrat they’ll use titles ripped from the self-help aisle like Know Your Power and The Audacity of Hope. For his first publication Ike went with A Guide to the American Battle Fields in Europe—and then wrote 282 pages on the specific battle strategies used by the American military in WW1.

Verdict: UNDERRATED

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To Hate or to Adhere

Why does language evolve the way that it does?

I stumbled upon a passage written about John Adams by Thomas Jefferson. Adams was a notoriously jealous and petty. He earned the nickname “His Rotundity” for being obese and arguing that everyone should refer to George Washington as “His Majesty the President.” Jefferson was a cool guy. A philosopher and statesmen that shared the opinion that most reasonable, fun loving people of the era had: Adams was a jerk. After learning that Adam’s official notes from the Treaty of Paris were “a display of his vanity, his prejudice against the French court and his venom against Dr. Franklin.” I found Jefferson’s reply interesting. He simply wrote, “[Adams] hates Franklin, he hates [John] Jay, he hates the French, he hates the English. To whom will he adhere?”

This begs the questions: Why, 232 years later, do we say we hate things, but not adhere them?

Thomas Piketty’s Inequality Wake Up Call

This post begins with me sitting in a conference room that overlooked the capital city of a developed country. The room was filled with a handful of Ivy League MBAs, a former officer at a major international bank and two high-level government officials. We were tasked with developing a strategy for the nation’s financial service industry. They viewed themselves as the next Dubai or Singapore, but lacked the infrastructure and history of success. Across from us sat an executive at the second largest corporation in the nation. Her job was to direct the company’s overall strategy. That morning we were there to ask ACME Corporation questions around the private sector’s views on the financial system.

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5 Articles That Explain the Ukrainian Revolution

The world has been on high alert since Russian President Vladimir Putin threw caution to the wind and sent military troops to occupy Ukraine’s Crimean Peninsula. This act of aggression coincided with the defection of Ukrainian naval leadership and the seizing of parliamentary buildings by forces loyal to Russia. Many columnist and analysts are predicting a massive global conflict and a potential return to the Cold War era. What we aren’t seeing is a coherent narrative about how the conflict got to this stage. I’ve gone ahead and curated 5 great sources that paint an accurate narrative of the historical, political and strategic framework of the 2014 Ukrainian revolution.

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Classic Reads: Simon Johnson’s “The Quiet Coup”

In May 2009 The Atlantic Magazine published an article by Simon Johnson titled, “The Quiet Coup.” Today, “The Quiet Coup” stands as one of the watershed articles on the 2008 financial crisis. Johnson, the former Chief Economist of the IMF, argued that roots of the financial crisis was not interest rates or poor people taking out loans they could not afford, but that financially and politically the United States had more in common with Russia than Germany.  “Elite business interests,” he wrote, “played a central role in creating the [financial] crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed…”

To put this in entertainment terms, the closest thing to Johnson’s pronouncement would be if Meryl Streep suddenly gave up serious acting and began producing hard-core pornography.

It is also the exact reason it is a classic article.

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Income Inequality: Why Conservatives are Wrong

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n 2012 the top 1 percent of Americans took home over 20 percent of the income generated in the country. According to Annie Lowrey of the New York Times, this level of income equality was one of the highest rates since 1913, when the federal income tax became law. Think about that for a minute. Things are more unequal today than when John D. Rockefeller was alive. “That should offend all of us,” President Obama remarked in a December speech addressing the topic.

In a lot of ways income inequality is like climate change. Both are happening, both are exacerbated by our current system, and both threaten to upend the entire world.  Deniers of both situations create an environment where facts become debatable. Despite 97 percent of climate scientists agreeing “that climate-warming trends over the past century are very likely due to human activities,” it is still acceptable for a mainstream American politician to argue if it is even happening. The same holds true for income inequality. “In far too many countries the benefits of growth are being enjoyed by far too few people,” Christine Lagarde a managing director at the IMF told a group at the World Economic Forum. If a leader at an organization whose answer to every economic problem is tax cuts and trade liberalization says income inequality is a problem, it is a problem.

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Obama, Thurgood Marshall and the Importance of a Long Term Vision

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oday marks the 21st anniversary of the death of Thurgood Marshall.  He was a complicated man and perhaps the person most responsible for ending segregation in America; first as Chief Counsel of the NAACP’s Legal Defense Fund and then as a Supreme Court Justice. Marshall had immeasurable courage, once saving an innocent plaintiff from certain execution by interrupting a poker game between the President of the United States and the Chief Justice of the Supreme Court. When asked by Marshall to sign a stay of execution Chief Justice Fred Vinson remarked, “I’ll tell you one thing, if you’ve got guts enough to break in on this, I’ve got guts enough to sign it.”

For those interested in learning more about Marshall I’d recommend Gilbert King’s Devil in the Grove a Pulitzer Prize winning investigation into the 1949 Groveland Four Trial. The book offers a history of the civil rights movement, a biography of Thurgood Marshall, and a parallel to Obama’s second term strategy. 1

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verturning 100 plus years of institutional racism needed not only courage, but a legal and strategic genius. Marshall was both. If he found out that a judge liked English precedents he would craft a brief overflowing with English cases from the 1700s. If he needed help from federal officials he would release a well-placed memo condemning communism. If he needed information from a rival he would take them out drinking. “He’d get a lot of outside lawyers together in a room, and he’d be talking and laughing and drinking along with the rest of them and getting everybody relaxed and open, and he’d seem to be having such a good time with them that you wouldn’t think he was listening.” Franklin Williams a former NAACP lawyer turned diplomat later recalled, “But after they’d left, there it all was—he’d had the benefit of all their brains, which was his strategy in the first place.”

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Average is Over and Obama’s New Manufacturing Initiative

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ast week President Obama announced plans to build a high tech industrial institute in Raleigh, North Carolina. The public/academic/private partnership will produce next-generation semiconductors, and is the first of 3 planned manufacturing projects by the Administration. “We’re not going to turn things around overnight,” President Obama told the crowd, but “we are going to start bringing those jobs back to America.” Stump speeches are great, but change happens is in the details, and the details haven’t been answered yet. The News Observer reported that specifics of the agreement “remain to be worked out in contract negotiations.”

One thing is clear, American manufacturing has been devastated in the last 20 years. The cause differs depending on which side of the political isle you stand, but it is hard not to believe that poor policy hastened the decline. According to a 2012 Yale study, the establishment of normal trade relations with China directly contributed to America shedding about 6 million manufacturing jobs from 1970 to 2007. Others  argue about labor unions killed the factory, technology hastened the death, and  the  gravity of globalization made the preceeding two irrelevant. The simple fact is that America is now defined by cheap consumer goods, rising structural costs (healthcare and infrastructure) and stagnant incomes. “You have an economy,” Obama told  The New Yorker in January 2014“that is ruthlessly squeezing workers and imposing efficiencies that make our flat-screen TVs really cheap but also puts enormous downward pressure on wages and salaries.”

What do we do about it?

We start by turning one of the causes of the decline into the solution.

Essentially all economists agree that technology hastened the decline of American industrial labor, in fact I’d argue that most middle class jobs will be either replaced or supplemented by computers in the next twenty years. This is not unique to America or to modern information technology. Just as IT made many factory jobs expendable, the car killed horseshoe makers, and the cotton gin decimated hand weavers. In his latest book Average is Over, Economist Tyler Cowen chronicles the increased inequality of the American labor market, with a special focus on the impact of smart machines. Technology has replaced a large amount of middle class jobs with service jobs, and his underlying assumption is that artificial intelligence will do the same to accountants, lawyers and factory workers. The key questions facing future employees will be:

Are you good at working with intelligent machines or not? Are your skills a complement to the skills of the computer, or is the computer doing better without you? Worst of all, are you competing against the computer? Are computers helping people in China and India compete against you?

It is early, but these questions have not been answered yet. Will this initiative place workers in tandem with smart machines or in competition? If production and not analysis is the goal (Cowen argues that smart machines will eventually be used as a guide to production, where workers take a computer’s analysis into consideration but make the final decision), we may be jumping head first into a commodity pricing. The last 20 years have shown what happens when we tried to compete on price with humans. We can’t expect to win the battle against a computer.

Why Edward Snowden is Only the Begining

Institutions need to evolve. “Spy Kids” by Charles Stross explains how the US created a bureaucratic culture that impedes that evolution. “We fool ourselves into thinking that our national culture is static and slow moving,” writes Stross. He argues that the government, specifically the security agencies, are designed for a culture of long term employment–Unfortunately that clearly doesn’t exist anymore. Longterm employment begets loyalty, but through a combination of temp workers and outsourcing nearly every aspect of our society has changed, and security work is no exception. Snowden didn’t collect a paycheck from the NSA; he got one from Booz Allen. The only loyalty he had was to an ideal of nationalism, one that he viewed the very programs he exposed violated.

“If I were in charge of long-term planning for human resources in any government department, I’d be panicking,” he concluded, “Even though it’s already too late.”

Source: Charles Stross – Foreign Policy