Doug Erwin, an Economics Professor at Dartmouth, writing in The Wall Street Journal, had a thought.
Restoring trade ties and expanding commerce would revolutionize the Cuban economy and transform Cuban society. It would spur the growth of a business class, creating competing pockets of power and new, wealthy groups that would challenge the ruling Communist Party. It would give Cuban citizens access to more information, and information about the outside world destabilizes any repressive regime. What would happen if every Cuban citizen had access to a smartphone, could organize protests via Twitter, and spread the word about government outrages?
Sony made a movie about two journalists scoring an interview with northern Korea’s Bébé Doc, Kim Jong-un, the CIA convincing the journalists to assassinate Kim, and the comedic aspects of such a thing.
This offended Baby Kim and his sycophants, and they threatened mayhem against Sony’s executives and those US movie theaters with the temerity to show the movie.
Rather than letting us Americans make up our own minds about whether to go see the movie, rather than letting movie theater managers determine for themselves whether to show the movie (some had), those threatened Sony executives collapsed like yesterday’s tissue and made the executive decision to not release the movie at all.
Technologies that can’t compete in the market place aren’t ready for market, nor are they ready for our consumption. Subsidizing these not-ready techs is one way of plusing them up. Another way is to penalize their competition for being too successful.
The New York Times tells this tale, albeit carefully buried in the nether regions of Katharine Seelye’s article. Overarching all of this is this:
New England [Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont] already pays the highest electricity rates of any region in the 48 contiguous states because it has no fossil fuels of its own and has to import all of its oil, gas, and coal.
Michael Heise, Chief Economist at Allianz SE, had some in his op-ed in The Wall Street Journal, but I want to focus on just a couple, for the mindset implied as he—and Europe’s politicians—address inflation and tax policy.
They [tax and ultralow-interest rate policies] encourage risk taking among investors searching for yield, potentially leading to malinvestment. They affect the distribution of income and wealth between the less affluent, who are most affected by low returns on bank deposits, and the wealthier, who tend to benefit most from rising share prices. Finally, perhaps most important, ultralow interest rates discourage savings for retirement and slow down the growth of existing pension assets.
…and why it’s feeling the need to go out from the Center of Heaven and seize the East and South China Seas, to expand into the Siberian oil and mineral fields (this time peacefully, but no less to the detriment of Russia), why it steals intellectual property.
One interview with an environmental engineering student at Tsinghua University stuck with me. His parents grew wealthy by building companies that made shoes and water pumps. But he had no desire to follow in their footsteps—and they didn’t want him to either. Better that he work for the state, they told him: the work was more secure, and perhaps he could wind up in a government position that could help the family business.
The backdrop is this: last spring, Japan enacted a tax hike in an effort to start covering its public debt and bring that under control for the benefit of the Japanese economy and the Japanese citizen. The country promptly fell into recession as even more money was taken out of the citizens’ hands, removed from the private sector of the economy. As a result of this, Prime Minister “Shinzo Abe called a snap election for December and put off a sales tax hike planned for next year until 2017.”
Here’s the AP’s lack of understanding of basic economics, as demonstrated on the other side of the link above.