Is education a measure for world power?

Considering post-industrial economic might is so influential in our globalized world, education is more important now than ever before (see this post). China, already a rising industrial power, is looking to become the next world leader in services that require an educated workforce — as are many other emerging and developed nations.

What defines a global "superpower"? In the past, it was the size of national armies or possession of nuclear weapons.

But now there is a more important (and peaceful) benchmark: the size and prestige of university systems.

And, while the US is still the global higher education "superpower", China will soon be knocking it off top spot if current trends continue.
...
China is now the largest higher education system in the world: it awards more university degrees than the US and India combined.

Hopefully as China's population becomes educated they will make a further push towards democracy. Under free conditions, education will surely flourish even more as more people are given the opportunity to study and the system becomes less corrupt and restricted, hopefully with available aid from the government.

Education and globalization: the case against protectionism

Protectionism is all the rage in the United States nowadays, fueled by xenophobia from nativists (because of hot topic of immigration, especially from Central America), isolationists (partially because of foreign policy fiascoes like Iraq), and, most of all, anti-free-traders (anti-China; those seeking an enemy to blame for the loss of US manufacturing jobs).

America cannot stick its head in the sand just because of some foreign policy screw-ups, a trade deficit and loss of blue-collar jobs to places like China, and the influx of immigrants — many to do jobs Americans probably wouldn't. Pretending a problem doesn't exist or enacting a quick 'fix' isn't the answer. Politically, the Republicans are more anti-immigration; the Democrats more protectionist. But, as many financial experts warn, protectionism or xenophobia is not the answer to America's economic woes. Globalization isn't something new, and don't expect it to go away either.

Bloomberg:

Southern U.S. states should improve workers' skills to compete in the global economy rather than look to trade restrictions for protection, three Federal Reserve bank presidents said.

Barriers to commerce can backfire and hurt the economy as overseas partners retaliate by imposing their own restrictions against U.S.-made goods, the Fed chiefs from Dallas, St. Louis and Atlanta told a meeting of the Southern Governors' Association in Biloxi, Mississippi, today. The Fed presidents didn't discuss the current economic outlook or monetary policy.

``The answer is not protectionism,'' Richard Fisher of the Fed Bank of Dallas said in his speech. ``Rather than labor fruitlessly to protect your constituents from foreign competition, you and your legislatures must prepare them for it.''

Fed officials have been touting the benefits of free trade as members of Congress call for restrictions on imports from China, accusing the world's fastest-growing major economy of keeping its currency artificially cheap to benefit exporters.

The officials' comments don't just apply to the American south, but the whole of America and numerous other developed countries seeing the effects of globalization on the industrial workforce, and the economy in general.

The importance of people of developed countries to learn
As China and other emerging economies are using the mostly-positive forces of globalization to scoop up manufacturing jobs, America and other developed countries are in more need as ever for educated, skilled workers. If jobs are being lost, more need to be filled or created. Since many people cannot afford or achieve a high-level college education, there should be at least some government-run instructions.

More and more people seem to not be prepared for the real world. And as economic globalization increases the US and others are in need of innovative thinkers and service industry workers. Education has to start from childhood and continue through adulthood — from primary school to job training.

Tariffs
For a developed economy like America's, tariffs are counter-productive. They hurt the consumers because they raise prices, and lower competition and quality. They do, however, help the businesses they affect; but, in general, strong tariffs are not a good thing. In addition they are almost always politically-motivated (special interests) and are very rarely used appropriately. Ironically the pro-business politicians in the United States that used to support tariffs now favor their own brand of 'free trade' (e.g. Bush), like CAFTA, but bend the rules now and then.

Fair is (often) free
Note: Just because I believe in free trade, that does not mean I am against regulation, including in the case of fair trade. The exploitation of the poor by the rich is not what the free market is about. Sadly, that's what it has become. On economic issues I am somewhere to the left of the centrist weekly The Economist. Protectionism and idiotic tariffs are not the equivalent to fair trade; the protection of third world workers sorting through our trash is.

Globalization: A very old trade

What we know today as 'globalization' has actually been around for tens of thousands of years, says Nayan Chanda in his new book, Bound Together: How Traders, Preachers, Adventurers, and Warriors Shaped Globalization, reviewed recently in The Economist:

Nayan Chanda, director of publications at the Yale Centre for the Study of Globalisation, provides background facts for less lazy thinking in a lively book that is packed with incident, anecdote and derring-do.

He points out that globalisation is a new word to describe an old process. The word was introduced in the late 1970s and had gained widespread currency by 1999, the time of Mr Bové's visit to McDonald's. Many thought it described a wholly novel phenomenon. But globalisation really began about 60,000 years ago, when the first migrants walked out of Africa. Human history ever since has been a process of growing interconnectedness.

Mr Chanda organises his argument around what he takes to be the four groups that have done most to bring about this interconnectedness: traders, preachers, adventurers and warriors. Though the motives of these groups—to profit, convert, learn or conquer—have usually been selfish, the overall effect of their actions has been to draw us all closer together.

Globalization has its pros and cons. Pros include the spread of knowledge — scientific/technological as well as artistic/cultural, also the factual and the theoretical — and the trade of goods. Cons include the effects of the trading of goods: the spread of diseases, or non-native plants and animals that damage the environment, or the exploitation of a less powerful country by a more powerful one, or the proliferation of negative ideologies and movements. It opened the door for imperialism and colonialism, but also for the spread of gunpowder from one civilization to another. It brought European diseases like smallpox to the 'New World' while also enabling a vaccine invented in Switzerland and manufactured in America to help people in Indonesia confront the latest pandemic.

Globalization helped bring about today's global warming, but might also be the key to solving it. Cooperation, however, is essential. Part of globalization is of when one party dominates, conquers, or forces another to accept their terms; part is an indirect and/or unintentional (or intentional) spread; part is a mutual acceptance and awareness.

Globalization allows people in Argentina read a blog written by a United Nations peacekeeper in Palestine — heck, without an international network there wouldn't be a true UN. Sure globalization is primarily associated with an economic connectivity ("to profit"), but we also see cultural hegemony ("to convert"), a more pacified spread of ideas ("to learn"), and the most abrasive ("to conquer").

We meet globalization's challenges and reap its benefits, and never do we see it relinquish its status as a controversial phenomenon. If humans are naturally curious, then globalization is our way to connect and spread all aspects of our society, and sometimes to accomplish individual aims — invade country X, seek new riches, convert the people of land Y to religion A.

Nowadays we view globalization as the reason Pakistanis suffer in sweatshops to make our Nikes or why France's traditional fine tastes are being corrupted by American fast-food. We sometimes think only of the traders and warriors. Globalization has an ugly past too, such as the African slave trade, but we are all the more aware of its effects now, ironically because of it: the spread of this knowledge, a result of communication which itself is a result of globalization. Sometimes we miss the bigger picture. Without globalization, would I be writing or you be reading this blog?

France: voting for change

Sarkozy v. Royal comes to an electoral close in less than two hours...

Some French voters think Sarkozy would do a better job at changing France for the better; some think Royal would. Sarkozy would be more likely to make tough, necessary changes, but his policies are sometimes undesirable and he has been courting the far right in order to ensure a win in this election. Royal, on the other hand, may be too weak and politically inexperienced to enact the change France desperately needs, and she still sticks to her old left foundation — something she, and France, needs to move away from. Job security and market liberalization are two issues at hand, as are immigration and law enforcement. The reform of the government structure in general is also needed. Royal spends too much; Sarkozy invades privacy and uses power too much.

As of now, over 75% of voters have cast their ballots for either Sarkozy or Royal in the second and final round of the French presidential election. This is the highest turnout in decades. The first round also brought out near-record turnout.

Some are pessimistic about whether this election will bring change. No matter who wins, they need to be open to defying protests and what seems like the defiance of the public to reforms for the greater good. Current President Jacques Chirac was too afraid to follow through on his initiatives for change, and many French politicians flinch every time they see protests against the reforms they wish to pass. Whoever wins has the support of the public, and should use that support to actually change whatever needs changing — and many things do. On the other hand, the winner does not want to turn into a dictator by public choice, per se.

This election has been full of controversy and debate, bringing the French seemingly closer to the politics France is known for. However these are politics with a new face: voters, forced once again to choose between left and right, are not following traditional voting labels. One memorable event has been Royal warning that her left-wing supporters could riot if Sarkozy wins, which can either be taken as a political threat or a misunderstood musing. Riot police and extra law enforcement have been sent to Paris to avoid mass riots (remember 2005?) if political tempers flare as the result of a Sarkozy win, especially among the poorer suburb dwellers and immigrants.

In France, the president is a very powerful figure, and one could only hope Sarkozy or Royal will not abuse that power. So will it be the traditional leftist with a new spin, Socialist Segolene Royal, or the center-right (neo-)Gaullist, Nicolas Sarkozy? I’m guessing the latter. Although he has the will power to pass the reforms France needs, he also has a tendency to misuse power. Royal just doesn’t seem cut out to be the leader either.

Nonetheless its not my choice that counts, the votes of the French people will decide who the next leader of France will be, and those votes are important indeed. Bolstering France in the international community will be yet another task for the next president; and globalization is a huge issue at hand, politicially, culturally (immigration), and economically (trade and jobs). For example, both candidates have been bad-talking the EU, an overused scapegoat for poor government policy and an 'evil' Sarkozy or Royal are trying to make voters think they could fight against and protect France. This protectionism will certainly not help France's troubled economy.

Early results will be announced later today, and official results will come on 10 May. Several polls from very late on 4 May put Sarkozy 10 percentage points in front of his challenger.

Centrist Francois Bayrou, who lost the first round, has seen his popularity skyrocket and may yet be able to form a moderate political coalition with his weak UDF party. Go Bayrou!

Wikipedia has an extensive article on the election.

Update:
Early results claim Sarkozy as the winner of this second round vote. Royal has admitted defeat and police are preparing for political unrest in case rioting brakes out as a result of Sarkozy's electoral triumph.

technorati tags: france+election+2007, french+presidental+election, nicolas+sarkozy, segolene+royal, in+the+news, france+reform+politics, globalization

Don't just blame the superpower

It's really easy to blame the United States — and just the United States — for a number of things. It's a perfect target. The world's sole superpower, the US makes foreign policy mistakes frequently. Of course it is also easy to blame the big guy: the most powerful, most senior, most vulnerable for criticism, etc. On the subject of greenhouse gas emissions, however, it might be a bit harder to put the whole of climate change blame on the US. The International Energy Agency (IEA) has stated that China could very soon overtake the US as the leading greenhouse gas emitter. Greenhouse gases play a role in global climate change.

The IEA says China will give our more CO2 than the US by 2010. Of course China is developing, less wealthy and more unable to enforce or create environmental standards, and just harder to blame than America. Even staunch free trade activists say that wealth leads to environmental enlightenment (and wealth comes from the exchange of goods, i.e. trade). China is no doubt being reckless in its massive industrial endeavors, but it does acknowledge climate change. But like the Sudan issue (generally), there is more rhetoric than action.

A big issue is the use of coal powered power plants. America also uses coal as a primary power source; coal is one of the dirtiest sources of power. Both economic giants must act now more than ever — especially the developed, wealthy US — to reduce coal dependence and enforce, not just promote, clean environmental policies. At the risk of sounding like a Green: we only have one planet, let's treat it wisely or future humans will pay the price. China and the United States are both huge countries with plenty of wind power potential, plenty of sun, and plenty of coastline and rivers for water-powered energy. I'd say its more cost effective to dish out some money for solar panels and wind turbines than to destroy your planet, thus destroying any economy. Why not pay the relatively small price now so we don't have to pay it later — when it will have a cost in currencies other than dollars, euros, yuans or yen.

When one considers all the factors, America has more of a responsibility to take action on its environmental policies, but China could save itself plenty of money (not to mention other things) if it acted sooner rather than later. At the risk of sounding like Al Gore: it's time for governments to act, now, on global warming. How does it hurt to not destroy our only habitat as much anyways?

I'll be covering alternative energy more soon, as well as free trade.

Chinese stocks tank, causing global chain reaction

BBC News

AP (via Forbes):

Stocks had their worst day of trading since the Sept. 11, 2001, terrorist attacks Tuesday, briefly hurtling the Dow Jones industrials down more than 500 points on a worldwide tide of concern that the U.S. and Chinese economies are stumbling and that share prices have become overinflated.

The steepness of the market's drop, as well as its global breadth, signaled a possible correction after a long period of stable and steadily rising stock markets, which had not been shaken by such a volatile day of trading in several years.

A 9 percent slide in Chinese stocks, which came a day after investors sent Shanghai's benchmark index to a record high close, set the tone for U.S. trading. The Dow began the day falling sharply, and the decline accelerated throughout the course of the session before stocks took a huge plunge in late afternoon as computer-driven sell programs kicked in.

The Dow fell 546.02, or 4.3 percent, to 12,086.06 before recovering some ground in the last hour of trading to close down 416.02, or 3.29 percent, at 12,216.24, according to preliminary calculations. Because the worst of the plunge took place after 2:30 p.m., the New York Stock Exchange's trading limits, designed to halt such precipitous moves, were not activated.

It was inevitable, in some way or another, not only because markets have their ups and downs, but also on account of the record highs the Dow Jones and other stock exchanges have reached recently. Only last year did Japan's Nikkei stock exchange nearly collapsed from massive trading, buying and selling.

Some questions I have (to consider):

Is this a mere technical glitch from the 'computer-driven' trading?

Is it an indicator of weakness of markets in Europe and China?

How will this incident affect the year to come?

Did Chinese stocks fall because of a natural up-down pattern, or was it a sign?

Did stock regulations help prevent an even worse episode?

Should we let the market be free and fluctuate on its own?

Is this a one-time kind of event, or will we be seeing more extreme falls or rises?

Is the US and its market too dependent on China (after all, China's markets triggered the chain reaction)?

Does this tie into dynamic globalization?

Ultimately: Was this a mere 'correction' in the inflated stock prices or an indicator of the global economy?

technorati tags: dow+jones, nyse, china, united+states, economics, global+economy, news, stock+market, stock+exchange

Inside the WEF's Davos 2007

Some of the worlds most powerful and recognizable figures have been meeting in Davos, Switzerland over this past week discussing everything from climate change to currencies. Davos 2007 is a meeting of the World Economic Forum. At first glance it may just sound like a meeting of economists, albeit at one of the nicest ski resort areas on earth. When one takes a closer look one sees a conference with influence that can measure on a massive scale. The likes of British Prime Minister Tony Blair, rock star/activist Bono, United States' Sen. John McCain, the globally influential Google's Chairman and CEO Eric Schmidt, Microsoft head Bill Gates, US Sen. John Kerry, and German leader Angela Merkel are all in attendance at the WEF meeting, and are joined by non-Western dignitaries such as the Chinese economic minister in addition to Brazil’s re-elected President ‘Lula’ de Silva. I find it amazing how many blogs are talking about Davos, and how many of them are newsblogs not run by individuals, but by news organizations like the BBC, CNN Money, The Economist, The Guardian, Comment is Free, Newsweek, Huffington Post, Financial Times, and the International Herald Tribune, and the New York Times. Le Monde (translated) and the Wall Street Journal have also joined the party. Davos ’07, like the World Economic Forum itself, is obviously elite — which is why there has been opposition to it, just like there is opposition to the G8, WTO, and other governmental and economic conferences.

The World Economic Forum's meeting may now be over, but its reverberations still feel the news atmosphere and international zeitgeist. I said earlier in this post, climate change seems to be a topic on everyone’s mind at Davos. Global warming will have not only a disastrous human and environmental impact, but obviously an economic impact too — as the Stern Review confirmed. If precautions are to be taken against things like greenhouse gasses, it would be better for those precautions to be taken now than later, when they would be even more costly. If I was a political leader in country X, it would be more economically and otherwise effective to work to prevent the effects of human-caused climate change sooner rather than later; the cost — in money and lives — would be all the more higher the longer I wait. That being said I’d look for dampers on global warming sooner rather than later. Let’s say country Y waited 40 years until they took any action their climate change battle. By then the environmental consequences have a massive malevolent potential and the cost of working to save what has been lost by global warming and work against the problem at its core would be more expensive than if that country had done it 40 years prior.

One major story relating to Davos on the climate change front. BBC News:

UK Prime Minister Tony Blair has told the World Economic Forum a major breakthrough on long-term climate change goals could be close.

Germany is taking center stage in the push for moderate globalization and has been a major player in European and world politics lately. Angela Merkel, the center-right German chancellor, has done well at balancing all the different forces of globalization — from human conflict and terrorism to climate change — in her recent agenda. Another international relations topic revealed more at Davos is that the United States is not nearly as ‘all powerful’ as it used to be, at least in regards to global economics. There’s a great IHT opinion piece on the matter.

This year's theme at the World Economic Forum annual meeting here — "the shifting power equation" — confirms the view of many participants that power is draining away from the United States to multiple centers as countries from Brazil to China move beyond "emerging" market status to establish themselves as major players on the world scene.
…
Far from some kind of conspiracy of the global elite plotting the future as they whisk down the Alpine slopes, Davos is in fact a back-end barometer of their evolving worldview. It does not break new ground but consolidates opinion. It does not generate new trends but codifies them into conventional wisdom. That is its power and its importance.

There is also hope for (BBC News) what is called the Doha round (The Guardian) of trade talks between the developed and developing nations. The Doha round ended without agreement earlier in 2006 and was seen as a failure of both sides of the developed/developing fringe. Skepticism should still be used for these trade talks, but if Doha does gain progress from the recent push at Davos, one may hope a positive outcome is reached. Some have gone far enough to say 2007 is going to be a ‘good’ year (BBC News) for economies in general. (As you can tell from the abundance of linking to the BBC News site, there is a lot of good Davos news there as well as at the afore-linked blogs and news websites.)


Updated with more links to sites covering Davos '07.

technorati tags: trade, economics, blair, merkel, germany, uinited+states, davos, doha, world, economic, forum, economics, world, news, in+the+news, current, politics, world+trade, globalization, climate+change, global+warming, wef, davos+2007