…the whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence. The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.
via Economics in One Lesson, The Lesson.. Read the book online for free.
A quote from Charles T. Munger.
“Our experience tends to confirm a long-held notion that being prepared, on a few occasions in a lifetime, to act promptly in scale, in doing some simple and logical thing, will often dramatically improve the financial results of that lifetime.
A few major opportunities, clearly recognizable as suc, will usually come to one who continously searches and waits, with a curious mind that loves diagnosis involving multiple variables.
And then all that is required is a willingness to bet heavily when the odds are extremely favourable, using resources available as a result of prudence in the past.”
This month, the City of Newark, Delaware became the first electric utility in the US to use a car to store and provide power for the local electric grid.
In my view, the electric car system will change the entire pradigm of energy, costs, convenience and greenhouse issues. Earlier I wrote about Shai Agassi’s plan.
Now, with the testing of the first cars in the US to power the grid, the entire electric car system is completing a full cycle.
This is an area to watch.
via City of Newark first in nation using cars to power grid.
Lower prices mean more sales. More sales mean more books in Australian homes. Pick an argument with that.
via On the case for cheaper books | The Australian.
That’s Bob Carr, the former premier of the state of New South Wales. The argument for cheaper books in Australia is without a doubt.
I love books. I have been fascinated with reading books from the time I was in my 7th standard. Till that time it was only school books. My cousin, Vandana, sparked the interest in me for fiction which then translated in non-fiction and the love affair has not stopped.
Coming to Australia I have always been hampered by the high cost of buying books. The universities and the coucil libraries had some good books but for the latest ones (like The White Tiger), I had to buy it.
And it was extreamly expensive to buy one in the bookstores. Checking on the internet it was clear that you could buy it cheaper on Amazon.com or a gazillion other bookstores. A lot of the books where almost double the cost of books available in the US.
My initial reaction was that the bookstores are “robbing” the customers. However, as Carr explains, it is due to a import restriction on imports. All books need to the UK edition which is generally higher than the US one and then add a premium on top of that.
I actually read lesser number of books after coming to Australia due to this. I imported some from Amazon.com but the shipping cost did not make it viable. And add to that the greenhouse emissions.
In December of last year I found Better World. They focus on selling used and new books at Amazon.com prices or better. All profits go to literacy programs around the world and have a international shipping option of USD 4 with carbon neutral provision. This makes it easier to buy and I have been doing that for the last 2 months.
However, there needs to be a better solution.
Bob Carr talks about the question before the productivity commission to stop the restriction on import of cheaper books to Australia.
From the law:
“Parallel importation” refers to importation of products containing copyright material made legitimately in the country of manufacture. Parallel importation of books requires permission from the Australian copyright owner, unless the book was not published in Australia within 30 days of its publication overseas, or the Australian copyright owner cannot supply the book within 90 days.”
The case is not before the productivity commission. The report will come out in May 2009.
What can we do to influence this? Should’nt we have cheaper books in Australia like cheaper electronics, food, furniture, etc.
Update 1: I have created a page on this website for the cause and will try to spread this through Facebook too.
Quote in Tom Peters “Excellence“.
GoodGuide, a site that helps shoppers find healthy, sustainable, and ethical products, has raised $3.73 million in a first round of venture funding.
Venture beat says that , “The site provides data at whatever level you’re interested in. There is an overall score, then an overall health socre, overall environmental score and overall social score, then you can drill down and find out specific data points. O’Rourke says GoodGuide measures 140 criteria in all.”
via GoodGuide raises $3.73M for ethical shopping » VentureBeat.
I agree to the analysis by Kristof that in the hierarchy of bad jobs, sweatshops are not a bad deal.
I’m glad that many Americans are repulsed by the idea of importing products made by barely paid, barely legal workers in dangerous factories. Yet sweatshops are only a symptom of poverty, not a cause, and banning them closes off one route out of poverty. At a time of tremendous economic distress and protectionist pressures, there’s a special danger that tighter labor standards will be used as an excuse to curb trade.
When I defend sweatshops, people always ask me: But would you want to work in a sweatshop? No, of course not. But I would want even less to pull a rickshaw. In the hierarchy of jobs in poor countries, sweltering at a sewing machine isn’t the bottom.
[...]
Among people who work in development, many strongly believe (but few dare say very loudly) that one of the best hopes for the poorest countries would be to build their manufacturing industries. But global campaigns against sweatshops make that less likely.
Look, I know that Americans have a hard time accepting that sweatshops can help people. But take it from 13-year-old Neuo Chanthou, who earns a bit less than $1 a day scavenging in the dump. She’s wearing a “Playboy” shirt and hat that she found amid the filth, and she worries about her sister, who lost part of her hand when a garbage truck ran over her.
“It’s dirty, hot and smelly here,” she said wistfully. “A factory is better.”
via Op-Ed Columnist – Where Sweatshops Are a Dream – NYTimes.com.
The Mint comments on the recent endorsement of Narendra Modi, the chief minister of the state of Gujarat in India by two titans of Indian industry. Sunil Mittal and Anil Ambani both have praised Modi as having the capacity to be a PM of India.
Gujarat chief minister Narendra Modi combines unusual gifts for an Indian politician: Not only is he a vote catcher, but he is also a sound administrator. Under his watch, Gujarat has prospered, economically at least.
Does that qualify him to be “voted” prime minister by the big guns of Indian industry?
[...]
The lesson behind Wednesday’s endorsement of Modi is very clear. Indian companies and corporate leadership want heads of state governments and the political executive in general to have better decision-making abilities and have far lesser response time while taking investment decisions.
That is one way to look at it. The other is to believe that what India needs right now is a good functioning economy, sound administration and fast decision making capability without the problems of red tape.
Compared to the current PM, I do not see how Modi is a wrong choice.
Two of my favorite scholars, Richard Posner and Lawrence Summers, channel the spirit of Mr. Friedman in the Kinsley volume. Mr. Summers pithily sums up the case against Mr. Gates:
It is hard in this world to do well. It is hard to do good. When I hear a claim that an institution is going to do both, I reach for my wallet. You should too.
Mr. Summers reminds us of the problems created by hybrid institutions like Freddie Mac and Fannie Mae, where profit maximization and public support came together to cost taxpayers plenty.
[...]
In econ-speak, a sense of doing good is a luxury good. Journalists like to think that they serve truth as well as their newspapers’ owners. Doctors like to think that they have a duty to patients as well as to the H.M.O. that employs them. Firms cater to this human taste by frequently telling workers that they are doing both well and good, and sometimes that talk is more than just empty employee relations.
[...]
Does it make sense to consider hybrid organizations that have an obligation to earn financial returns, for some of their investors, and social returns for others? In a sense, the world has long had such hybrids in the form of profit-making subsidiaries of philanthropies and companies, like Ikea, that are owned by foundations.
Such hybrids will always be messy and may end up being unworkable. Perhaps the Friedman-Posner-Summers distaste for them is correct. I certainly agree with Friedman that traditional corporations have one overriding moral obligation — to fulfill their fiduciary duties and maximize shareholder wealth. Yet I’m also a fan of organizational innovation, which makes me a little more enthusiastic about the idea of experimenting with new legal entities with more complex objectives.
via Can Businesses Do Well and Do Good? – Economix Blog – NYTimes.com.
