傻冒儿 Stupid Hat aka ShaMao'er

Bipolar patriotism

Readers will know that one of ShaMao's favorite topics is the future of America and that I am pretty bipolar on the subject. One day I will be riding high gushing about philanthropic donations , and the next I will be sunk in the suburban blight of the Detroit suburbs .   

I just finished a great essay in Foreign Affairs (no link cuz subscription only) by Fareed Zakaria entitled The Future of American Power that has put me back in the high life.   Mr. Zakaria begins by contrasting the decline of the British Empire to current America, then talks for a time about contemporary America's relative strengths and weaknesses, and finishes up with a rather nonspecific call for political reform.  In the second section, Mr. Zakaria debunks several common myths that we hear about fairly regularly and presents some illuminating facts including these excerpts below (italics are mine):

• The United States has accounted for roughly a quarter of world output for over a century (32 percent in 1913, 26 percent in 1960, 22 percent in 1980, 27 percent in 2000, and 26 percent in 2007). Most estimates suggest that in 2025 the United States' economy will still be twice the size of China's in terms of nominal GDP.

• The United States spends more on defense research and development than the rest of the world put together. And crucially, it does all this without breaking the bank. U.S. defense expenditure as a percent of GDP is now 4.1 percent, lower than it was for most of the Cold War (under Dwight Eisenhower, it rose to ten percent).

• The Iraq war may be a tragedy or a noble endeavor, but either way, it will not bankrupt the United States. The price tag for Iraq and Afghanistan together -- $125 billion a year -- represents less than one percent of GDP. The war in Vietnam, by comparison, cost the equivalent of 1.6 percent of U.S. GDP in 1970, a large difference. (Neither of these percentages includes second- or third-order costs of war, which allows for a fair comparison even if one disputes the exact figures.)

• Biotech revenues in the United States approached $50 billion in 2005, five times as large as the amount in Europe and representing 76 percent of global biotech revenues.

• Or consider that the United States' current account deficit -- which in 2007 reached $800 billion, or seven percent of GDP -- was supposed to be unsustainable at four percent of GDP. The current account deficit is at a dangerous level, but its magnitude can be explained in part by the fact that there is a worldwide surplus of savings and that the United States remains an unusually stable and attractive place to invest. The decrease in personal savings, as the Harvard economist Richard Cooper has noted, has been largely offset by an increase in corporate savings. The U.S. investment picture also looks much rosier if education and research-and-development spending are considered along with spending on physical capital and housing

• The United States actually trains more engineers per capita than either China or India does. (all the figures we see to the contrary include so called "engineers" graduated by 2 or 3 year technical schools)

• The United States invests 2.6 percent of its GDP in higher education, compared with 1.2 percent in Europe and 1.1 percent in Japan. Depending on which study you look at, the United States, with five percent of the world's population, has either seven or eight of the world's top ten universities and either 48 percent or 68 percent of the top 50. The situation in the sciences is particularly striking. In India, universities graduate between 35 and 50 Ph.D.'s in computer science each year; in the United States, the figure is 1,000. A list of where the world's 1,000 best computer scientists were educated shows that the top ten schools are all American.

• "students in affluent suburban U.S. school districts score nearly as well as students in Singapore, the runaway leader on TIMSS math scores." The difference between the average science scores in poor and wealthy school districts within the United States, for instance, is four to five times as high as the difference between the U.S. and the Singaporean national average. In other words, the problem with U.S. education is a problem of inequality.  (I thought this one was interesting and in line with what I see in upper middle class America)

• Tharman Shanmugaratnam, until recently Singapore's minister of education, explains the difference between his country's system and that of the United States: "We both have meritocracies," Shanmugaratnam says. "Yours is a talent meritocracy, ours is an exam meritocracy. We know how to train people to take exams. You know how to use people's talents to the fullest. Both are important, but there are some parts of the intellect that we are not able to test well -- like creativity, curiosity, a sense of adventure, ambition. Most of all, America has a culture of learning that challenges conventional wisdom, even if it means challenging authority."

• The country has found a way to keep itself constantly revitalized by streams of people who are eager to make a new life in a new world. Some Americans have always worried about such immigrants -- whether from Ireland or Italy, China or Mexico. But these immigrants have gone on to become the backbone of the American working class, and their children or grandchildren have entered the American mainstream. The United States has been able to tap this energy, manage diversity, assimilate newcomers, and move ahead economically. Ultimately, this is what sets the country apart from the experience of Britain and all other past great economic powers that have grown fat and lazy and slipped behind as they faced the rise of leaner, hungrier nations.

McCain the Populist

My man McCain is disappointing me again:

This week, I laid out an economic plan aimed at providing immediate and long-term relief for all American families. One of the key components of this plan is a suspension of the federal gas tax on gasoline from Memorial Day to Labor Day of this year.

If there is any truth about the intersection between economics and politics it is that populism is never the economically correct way to go.  If something is designed to appeal to the populace at large, you can be sure it is economically nonsensical.  What does he think is going to happen in September?  If the price of oil hasn't collapsed by that time due to the continuing activities of the traitor (there's that word again) speculators or some global event affecting supply?   Are we supposed to believe that politicians will reestablish a tax, increasing the price of gas by $0.30 or so a gallon in a day, two months before an election?  It is not going to happen.  And after the election, it won't happen then either.  This will be a long term reduction in revenues at the worst possible time.

Continuous improvement

Everywhere I go I am constantly being bombarded by the America in decline hypothesis.  I see multiple books on it in the bookstore; I hear presidential candidates referring to it on TV; I am swamped by it by pundits in the media.  I am told that America's best days are behind it, we are declining and will soon be surpassed by others (like China! sure lol!)

ShaMao'er readers will know already that I believe this to be absolute crap.  The reasons are myriad, but here's just one representative example of everything that is right in America and in this specific case, truly without comparison anywhere else in the world:

The 2007 Slate 60 - Donations

Here's a representative example of what is contained within:

Dan and Jan Duncan—$75 million to various causes, including $50 million to launch the Neurological Research Institute at Texas Children's Hospital. The institute to study and treat pediatric neurological disorders will be completed by 2010. Dan Duncan is chairman and director of Houston-based Enterprise Products, an energy-services company, and wife Jan is a member Texas Children's Board of Trustees. The family has also been extremely active in cancer research and has given millions in support of the Baylor College of Medicine in Houston, where Duncan, a cancer survivor, was a patient.

Richard and Melanie Lundquist—$54 million to the Partnership for Los Angeles Schools and California Science Center. Lundquist is the president of Continental Development Corporation, a real-estate company that owns millions of square feet in California commercial space. His wife, Melanie, has been involved in children's educational and social causes and serves on the California Science Center Foundation's Board of Trustees. The 10-year, $50 million commitment to the Partnership for L.A. Schools aims to improve the city's public schools, but it is a conditional gift—the schools must show progress and meet benchmarks in test scores, graduation rates, and other categories. The two also gave $10 million to establish the Lundquist Cardiovascular Institute at Torrance Memorial Medical Center in Torrance, Calif.

As the name of the article implies, these are just 2 of 60 examples in 2007.  The smallest donation on the list is for $30 million dollars.

Ever heard of  Mr. and Mrs. Duncan or Mr. and Mrs. Lundquist?   Neither have I.    And that is the thing about America.  Random people make giant fortunes in a legitimate non-corrupt fashion and they give it back.  On a regular basis and to an extent completely unrivaled in the rest of the world (see below graph), they give it back to improve the nation.

Not exactly a sign of a nation in decline.

Just plain screwed

No, this is not going to be another China bashing post, I was thinking about something a little different.

Mattel Issues Third Major Recall

I was thinking that Mattel is just screwed here; and that it is quite likely that it will spread to other toy companies and perhaps other industries.  The thing is is that I bet there is a lawyer or two somewhere in the US who has bought up a bunch of Mattel toys and is having them tested for lead content.  If something is found, it won't be hard to find a few people who have bought that toy and suddenly a huge class action suit is in the offing.  Maybe, the lawyer has some contacts in China and so can target exactly which toys are more likely to be non-compliant.    So, if Mattel issues the recalls, they stand to lose a lot of money and brand trust.  If they know a toy is non-compliant and dont recall it and get caught in a suit, they are totally screwed.  If they don't test all their toys now for compliancy and one is found by the lawyer to be non-compliant, they are screwed. 

Now it is tempting to say that America is too litigious and that it adds huge cost to our economy.  That is true certainly in the short term but in the long term the results are a better safer society.  Even were Mattel to go under (unlikely) over this kind of issue; even if it were all caused by some lawyer somewhere and his basement chemisty lab; sure there would be some pain for Mattel employees and shareholders but the end result would be an America which did not import any toys that contained even trace amounts of lead.   

Indifference

The indifference of Americans to the rest of the world just never ceases to amaze me.  I think I may have written about this before, and don't want to go on and on again about such an obvious point.  But still, the scale of it staggers me.   

The fact that I have lived in China for almost the last 4 years tends to come up in many conversations with my new colleagues by way of introduction.  Now these are highly educated people who you might expect some level of curiosity out of.  Instead, so far by just about a perfect ratio, they take that information in, possibly ask how I liked it in an indifferent fashion, and then move on to the next topic.  They simply have no curiosity whatsoever in a country that it beginning to have such an calamitous influence on the world;or any other country for that matter including Iraq.  There does not seem to be any age influence at play here either, young and old they all act the same.  Although actually since I've been back the one person who has shown interest and asked some intelligent questions is the 84 year old father of my brother-in-law.

I just can't understand that.  All my life when I have met someone from anywhere else I have asked lots of questions; in some cases probably too many.  In my experience, this seems to be a largely American phenomenon.  People elsewhere seem to have far more awareness of and interest in the outside world.

I know there are many factors that play a role in this indifference including geography, economic dominance, military supremacy, generally comfortable life, etc.   It would be interesting (probably  only to me!) to know if this was a social characteristic common to dominant powers throughout history. 

The dumb and lazy stay home

Here's one that I do have to write something about. Better than Nothing     Typically great writing, analysis and commentary from the folks at Foreign Policy.  Love the phrase "Maginot-like border fences"...

Immigration is a "core issue" for ShaMao'er.  My basic thought about immigration has always been; who comes?   What kind of person leaves their home, everything that they know and are comfortable with, and moves permanently to an unfamiliar land with unfamiliar language and culture and where they may very well be subject to discrimination?   (note: not to be compared to ShaMao'er and his ilk who are extended tourists not immigrants).   My thought is that for the most part the kind of person who does this is not average and certainly not below average.   The kind of person who does this is probably pretty bright and undoubtedly motivated and a risk taker.  This is true regardless of any education / training he or she might have received in their home country.  The dumb and lazy stay home.   America should open its doors wide to these people as they are dreamers and builders and will contribute far more than they will ever take.  They keep America young and vibrant.  Actually, the fact that the genetic makeup of America come pretty much entirely from these sorts of people is one of the core reasons for our overall success.. 

Legs on a stool

Justices rule against Bush administration on emissions

And here is the text of the actual Supreme Court decision:  Text of Massachusetts vs. EPA

It is reading things like this that confirms my belief in the absolute genius of the basic structure of the American political system.  I honestly do not know how well the balance of powers between Executive, Legislative, and Judicial works in other countries.  I somehow suspect that even in Western Europe, one of the 3 functions is able to supersede the others (somehow I suspect it is the legislative in Europe but I really don't know much of the reality of it).   I am confident that the American check and balance system, invented almost 220 years ago and gradually honed over time, is the most dynamic and ultimately fair system that is currently, or ever has been in, existence.

A couple excerpts from the decision that I liked:

(c)
Given EPA’s failure to dispute the existence of a causal connection between man-made greenhouse gas emissions and globalwarming, its refusal to regulate such emissions, at a minimum, “contributes” to Massachusetts’ injuries. EPA overstates its case in arguing that its decision not to regulate contributes so insignificantly to petitioners’ injuries... that there is no realistic possibility that the relief sought would mitigate global climate change and remedy petitioners’ injuries, especially since predicted increases in emissions from China, India, and other developing nations will likely offset any marginal domestic decrease EPA regulation could bring about. Agencies, like legislatures,do not generally resolve massive problems in one fell swoop, but instead whittle away over time, refining their approach as circumstances change and they develop a more nuanced understanding of how best to proceed. That a first step might be tentative does not by itself negate federal-court jurisdiction. And reducing domestic automobile emissions is hardly tentative. Leaving aside the other greenhouse gases, the record indicates that the U. S. transportation sector emits an enormous quantity of carbon dioxide into the atmosphere. Pp. 20–21.