Where do we live?

We live in a shanty town of a city in the global south. That is if by 'we' you understand 'humanity' and you are talking in terms of the median person.

• How do we transform this situation? How do we change stagnant poverty into thriving empowerment?

Education is certainly a key factor, however I think the ideas of Hernando de Soto (interviewed on Zakaria's show) are incredibly important. Let me try to encapulate the central issues:

Almost by definition ending poverty requires improvements to the vitality of the impoverished areas. In order to create a thriving market you need a degree of stability i.e. some rules that are consistently followed (typically laws) so that people are confident that if they take risks by investing, then they will be able to reap those rewards and won't have them stolen or otherwise undermined. However even once there is enough stability that people can profit by investing you still need access to capital in order to invest. Personally I can easily raise capital through education loans which I can use to further my education - investing in my future; but most of the worlds poor don't have that luxury. Even if they have an idea - like building a new chicken coop to increase egg production - that would enable them to lift themselves out of poverty (and possibly also provide a new service to their community) most people simply wouldn't have the capital to invest to make the idea a reality.

There are successful cases where poor people are given access to capital such as the gramin bank in India where micro credit is issued on the collateral of social incentives, i.e. people make sure to pay back their loans because they don't want to be shamed by their community. However this model doesn't (and hasn't) worked everywhere, especially where communities are more transitory and social incentives aren't as strong. What might work better? Issuing property rights. Most people in slums by defacto own their land though they have no legal right to it and thus cannot morgage it to gain access to capital. De Soto suggests that institutionalizing the property rights of urban poor would dramatically increase poor people's access to capital and do much to end poverty. Of course such an approach is problematic.

• Will it encourage more land invasions?
• Will people break their mortgages since they know their land won't likely be taken away?
• Would it work without an effective rule of law?
• How much is a little plot of land worth anyway?

Despite these questions the point that I am trying to make is that as people ponder the question of how to solve global poverty along with:

• Increased education
• More food/medical emergency assistance
• Decreased trade barriers
• Debt reduction
• Increased aid
• Fighting corruption and
• Improving markets

they also remember that important parts of the equation are:

• Property rights
• The rule of law and
• Access to capital.

You belive that totalitarian propaganda?

If you think this is going to be a posting about the US media you need to get some perspective dude. Try going to North Korea. Kristof of the NY Times did just that and did some ground breaking reporting, the highlights are covered in this insightful web chat. In particular it mentions the fundamental thing that I don't understand about North Korea: Why do people "still believe in a system that has failed so badly." This is central to understanding North Korea because this isn't Eastern Europe or even Russia where people were privately cynical about communism (in public fear commanded vast support) . There is fear to be sure in North Korea (and some private opposition), but there is also significant support for this terrible regime. Is it because the intellectuals have been co-opted? Is it the effective marshaling of Nationalism? Is it the way the state has morphed itself into a religion?

These questions are important not only because the Korean peninsula is a potential military disaster that would make Iraq look like a walk in the park, or because the people of North Korea are some of the most oppressed in the world. But also from a more academic perspective because before you can understand Freedom you have to understand North Korea. Any reasonable definition of a free society must exclude North Korea, yet many people there believe in the government and choose to support it. It is a bit exaggerated to do so but would someone else consider me to be similarly misguided when I proclaim myself free? Just how exactly do you draw that line? Education level? Non-Dogmatic belief system? How easy is it for a society to turn into a North Korea, and just how sustainable is it?

Secret is sooo Cool!

When I heard that the name of the group of bombers in London was the secret society of al qaeda in Iraq. I was like: give me a fucking break! Your al qaeda! Everyone knows you're secret already. I mean, is it called the SCCIA? (Secret Club of the Central Intelligence Agency) No. I used to belong to a secret society too. It met in my tree house. Based on the name of the group alone you could guess that the bombers were 25 years old or younger. As it turned out one was 35 but the youngest was still a teenager.

What does this mean? I'm not sure, but I just think that as we try to understand how to solve the problem of terrorism everyone should keep in the back of their head that Shahzad Tanweer, Hasib Hussain, and Rashid Facha probably have a lot in common with Eric Harris and Dylan Klebold.

Can Words Move the Market?

Have you ever wondered when a talking head on TV says: "The Federal Reserve's comments on inflation have driven down the market today" if they aren't just saying things that sound reasonable but really the market was reacting to something else? I mean the central problem is you never can take two copies of the exact same market, give them two sets of Fed comments and then contrast their different responces. Well you couldn't have exactly that senario but something very similar unfolded one day last May. In the same day the Fed released two different statments! They just messed up, first releasing a (slightly) wrong statment, and then a couple hours later relasing a new corrected statment. Unfortunatly the story didn't quite unfold perfectly. The corrected statement was released after the close of the major markets, but from the reporting of the incident it sounded like most people knew about the mistake by 3:15 or so. Anyway details follow:

The story:

On the 3rd of May at ~2:10 the Fed released their comment on raising interest rates then ~4:50 they said they mistakenly forgot to add a sentence that said that long term dangers of inflation were not that great. Initially I think the market took the omission to mean that long term inflation wasn't a worry at all, so the market shot up. Then after the traders realized there had been a mistake it dropped back. You can see distinctive signals in the market data. It looks like the words influenced the markets about .5%. Thus words can change market valuation on the order of $100 Billion. It would have been good to have data on volume too, but still it's facinating. (Incidently it is amazing how closely the Dow and NASDAQ track each other.)

The data:

There still are Maoists?

When King Gyanendra all busted out with the Martial Law in Nepal to fight the Maoists it got me to thinking: Hunh? There still are Maoists? Someone needs to send them on a field trip to China.

I wanted to find out the following. Surely the political heirs of Mao wouldn't be indifferent to a group of rebels fighting for Maoist principles. Anyway I wrote a reporter at the Washington Post trying to get the scoop. I even tried pleading a little to get a response -- didn't work.


Feb 4th 2005
Dear Mr. Lancaster,

I am a native of the DC area and am a longtime reader of the Post. I am writing in regards to the coverage of the royal coup in Nepal. One angle of the story that I haven't seen covered in news reports that I find particularly relevant to understanding the problem, is to what degree the Maoists are supported either militarily, financially, or ideologically by China.

I ask this because historically the ideology of communism was fundamentally expansionist embodied in the slogan 'workers of the world unite.' The support - or lack thereof - by china of the Maoist rebels would measure the degree to which modern china views the importance of exporting communist ideology and perhaps would also indicate the legitimacy that traditional communist thinking still commands among the Chinese leadership.

sincerely,

Change in North Korea

The following is a note I sent to a friend about North Korea. Along with Northern Uganda and Burma, there are all places where it is clear things could be so much better if just a few people weren't around to keep things all maniacal. I'm not particuarly proud of the below analysis but the letter states something that even in the face of Iraq needs to be said. Maybe I should have chosen Tanzinia invading Uganda or Dayton or something less loaded but the Civil War is just so epic:

Feb 3 2005
If I knew of a way to change the North Korean Regime without massive death and suffering, I would advocate for it. Unfortunately I don't. Do you have any ideas?

I know some people would say: "It's not your place to change Korea; change needs to come from within."

And to that I would say: "Yes that would be the ideal strategy and works in many situations." But I would also say: "I think such opinions have an overly pessimistic view of the motivations of outsiders, and their ability in extreme cases to truly act altruistically and to change things for the better (on average) in a society that is not their own."

As a historical example of an extreme case, offered as a proof of principle rather than for the clarity of the analogy, I would give the North and the South of the USA. (which probably has a lot to do with why I feel this way). And the outsider with extreme ability would be from this very state good ol' Abe.

Of course questions could be raised about what qualifies as 'extreme' and what degree of unfamiliarity the outsider can really have and still be effective; I mean Lincoln was hardly an outsider, with a southerner wife, and he was sporadically the elected president of a country that had been unified for 87+ years.

Okay, I guess this historical analogy would really be asserting that if there is really ever going to be positive change in North Korea, it wouldn't have to come from within, but at least it would have to come from South Korea.

Yet I still think this is overly pessimistic, because (though the sample size is really too small to reach such broad conclusions) something I learned while living in Namibia is that while societies are very different (though rapidly becoming more similar for better(?)
or worse(?)) I found people to be essentially the same.

Great Net Resources - LRA

I found this site today.

In particular, though this video doesn't really cover that much information about the conflict, it is an important documentation of the lives and words of people who live in Northern Uganda.

Also the UNDP's magazine CHOICES deserves to be looked at.

ICC v. USA

(rough draft bordering on stream of consciousness )

As the EU, US, and UN argue over whether Sudan’s government sponsered brutality in Darfur are in fact Genocide, and importantly how they should be prosecuted, (with the EU pushing the ICC and the US pushing an ad hoc tribunal) the motivating question should be asked: Q: How do you stop crimes against humanity? A: You have laws that protect humanity and prosecute those who violate these laws.

This is a simple formula used on a national level in every country for a range of crimes large or small. Of course, it is no small matter that a crime against humanity, because of its universality of application, is obviously in conflict with the notion that each state is sovereign within its own borders.

While the treaty of Westphalia is hardly sacrosanct – over the years ad hoc tribunals have been set up for Bosnia, Kosovo, Indonesia, Cambodia, Serrie Leone, and Rwanda, to name a few recent cases – the concept a permanent International Criminal Court would be a large step in legitimizing the notion of international law with universal jurisdiction. This would be a very positive step in my view because as international law becomes more uniform and less ad hoc, governments considering a crime against humanity would need to think twice before proceeding.

Thus since I believe that America should fight vigorously for ending crimes against humanity, I believe America should support the ICC. Of course this ‘ass hole’ (really I think this word is rather apt) administration would never consider joining such a sensible arrangement.

Although now that I’m done venting my frustration I must admit that there are realistic concerns involved with American participation. It is a simple fact that – well – when america acts militarily, the world in large part instinctively opposes such action, and I would say with for understandable reasons. America's cold war and now post 9-11 alliances often are made more for expediency and power politics then for any moral reason. For examples of american hypocrisy we need to look no further than Nicaragua during the cold war and Uzbekistan today. (As a side note it is absolutely amazing to me on some level how the fact that both Afghanistan and Uzbekistan – both more populous than Iraq and Islamic – have extensive military contacts with america including the presence of large bases, basically goes unnoted by both global media and (global) Islamic fundamentalists (I think); with Uzbekistan especially so. Of course there aren't 150,000 americans troops occupying and killing, (and policing and rebuilding) quite like there are in Iraq, but this is kind of circular since the reason there still are that many troops in Iraq is because the insurgents made the presence of Americans an issue.)

Okay I've gotten sidetracked. I’m don’t want to argue right now whether American actions (historical or current) are crimes against humanity or even less technically if the use of american unilateral force has been right or wrong. I’m simply pointing out that bias against American actions exists. My case could be summed up in the following question: For the same crime, would a French general acting in Ivory Coast be tried the same way as an American one acting in Liberia? The answer I'm afraid is probably not. And not only because of a bias against Americans, but also because Americans expect an American exemption to international rules.

Is there a way around such problems? One way to brainstorm for a possible answer is to return to the analogy with national criminal law. Are there provisions that mitigate similar concerns? (Warning: I wouldn’t put my level of expertise much above the regular ‘Law and Order’ viewer). In american courts each individual is afforded the right to be tried by a jury of their peers (in principle); i.e. the jury must be made up of individuals that share similar life experiences, and wouldn’t presumably be biased against them. Thus in analogy, Americans should be tried by their peers. But what would that mean? When Americans are tried by the ICC should they be tried by judges from america, or alternatively judges from British influenced liberal democracies like Britain, Australia, Canada, and with South Africa and India thrown in to round things out.

… Hmm… Now that I’ve gotten the perspective of actually writing these worlds down, maybe this isn't such a good idea. And here is a point that makes it even worse. Who would be the peers of Sudan? Egypt? Uganda? Libya? Chad?

So maybe there isn't a good answer to this problem other than America just simply agreeing to go along with the court and having faith in the fact that when push comes to shove other countries are not going to send american soldiers, even those involved in Abu Guirab or Guantamino to the ICC, even though it’s clear that both instances are clearly wrong and need to be stopped.

But it’s tough because it’s not too hard to think of a future event where the world would want to try an american for crimes against humanity and could possibly have a point. For instance lets say that North Korea Produces 100 nuclear weapons and begins to export the bombs to the highest paying customer, state or non-state. The US feels it must act against the North Korean regime. It launches a preemptive attack and because of the potential counterattack against Seoul, it uses massive force (possibly WMD) killing hundreds of thousands.

Would America be tried for such a crime? Should, America be tried for such a crime?

Social (In)Security

(letter to Kevin)
The thing I don't understand about this whole proposal is based on the following: Isn't the central argument for why smaller government is better is that markets are more efficient when left unregulated? Don’t we want people to be able to make the decisions over their own money so that they can be freest to pursue their own happiness? Isn’t it supposed to be axiomatic that the intervention of the government can only distort the process of rational utility maximization and make less well off? (Of course people aren't perfectly rational, and neither are markets perfectly efficient, but that’s a different topic. The point is that these two assumptions are usually the best approximation)

So my question is, 'Why then do we all of a sudden need government to force us to invest? Why not just give a tax cut and let people save, spend, or do whatever they want? I guess to this people who support the administration’s reform package would say, ‘this is your money that you are paying into social security. Don't you want to invest it in the stock market?' To that I would say, ‘Sure! If that weren't a load of bullshit!'

It is bullshit to say that what I pay into social security is essentially like a savings account – that was never the way it was set up. Social Security is basically a 'rob the young and give to the old' scheme which I'm perfectly fine with. I deeply appreciate this country and the foundation that has been laid by the people that came before me. It is because of them that I'll be richer and enjoy a higher standard of living then they did (on average). Thus I have no problem supporting and providing security for people in their old age. Plus I just think it is the right thing to do – who wants to live in a society where old people are forced to think: 'well if I die before I turn 80 things will be fine, but if I live to 85 those last few years will be tight.'
Thus, what this social security reform plan is essentially an effort to take the money back away from the old and give it to the young to invest. But wait! They say. 'THATS bullshit. We would never cut benefits for the old people!' 'Oh how are you going to pay for them then?'
'Issue bonds.'
Issue bonds? What are you stupid? Do you know who owns bonds? Japan and China. Do you know why they buy bonds? Because, otherwise their currency would become like crazy expensive because of the huge trade imbalance. But it’s not really an imbalance -- they ship over TV's and Cars and we ship over bonds. I'm no expert here but I seen the dollar depreciate like crazy over the last few years, and Buffet says it’s probably going to come down more. I just think trusting on East Asia to keep on gobbling up good old Treasuries at rock bottom interest rates, is just foolish. Betting big on last year's best performer isn't the best strategy.
I mean this whole social security scheme only works if stocks continue to vastly outperform bonds. I just seriously doubt if this program is set up they will. The whole thing sounds great but if stocks are such a great deal why then wouldn't china just take its money and directly invest in stocks? Why would they buy bonds and then leave us with their money to make the real profit in the stock market? Oh right... it’s because they don't want the risk, but America will take on the risk. Right... sell China security; then gamble the money on the stock market, which is already about 30% overvalued. (20 PE ratio, compared to 15 historically) Sounds like the perfect plan for a program called social SECURITY.
Don't get me wrong. The ownership society is a great vision. I don't care if everyone becomes fiscal republicans (the good kind that like to balance the budget that is). I want to work to make it happen. But this idea just sounds bad.
The good news is I don't think it will happen. But shit, Bush has a tendency to surprise me.
PS. look for a limited strike on Iran's Nuclear Sites. First the talks with the Europeans are going to breakdown. Then the UN is going to not act. Then the US or Israel will do something stupid. I mean who is going to stop the neocons? Rice? Give me a break. You think Rumsfeld is chastened by Iraq? Forget it, he'll just say 'well the fire is already burning; lets throw in all the dead wood.' I give it about 0.5-1.5 years to play out.

¿ Mara Salvatrucha ?

25 people killed. No reason.

Here is another terrible story. What the hell is happening when a gang of thugs murders 25 innocent women and children who were just simply riding a bus? What is the cause of it? I certainly have a limited capacity to discuss the subject. Despite the fact that I have been to Honduras, and in particular to San Pedro Sula where this December atrocity occurred, and grew up in Northern Virginia where Mara is active, I still have had different life experiences and for the most part simply don't understand the motivations of those who want to join gangs. However I still feel there are some questions that I think are important to ask.

From US with Hate

Why did Central Americans have to come to the US before gang culture became strong there? What is unique about the American experience that made gangs so strong and appealing here? Is it the latent racism? Is it the income inequality? Is it the vast amounts of many available to criminal activity like drug and extortion? Is it the lack of functioning American communities? Is it the American family? Next, why are gangs now thriving in Central America and Honduras in particular? Are the same conditions that gave rise to gangs in the US now present in Central America? Is the criminal economy becoming more profitable? Are families feeling the same pressures of the modern world? Is Honduras now experiencing increasing polarization?

Al qaeda : Mara :: Patriot Act : ?

Now a second general angle on this story. Is Mara a terrorist organization? What makes it different from al qaeda? Both murder innocents in pursuit of their political agenda. Al qaeda however has different political objectives, i.e. presumably al qaeda would kill Americans for the express purpose of being America and has as a goal the destruction of America. At least I think so. Actually I doubt seriously that the American press does a good job of explaining exactly what al qaeda really wants or stands for. It is interesting how different types of violence are considered legitimate, but that is a different topic al together. I would also say that I wouldn’t trust what al qaeda says either partially because I don’t think they would hesitate to use the global mass media as a weapon and also I do think there is a lot of understanding to be gained by viewing al qaeda as a mass pathology as Paul Berman describes, thus trying to rationally figure out what al qaeda wants may not be all that successful. Further al qaeda is not now a hierarchical organization (if it ever really was) and is really a label used by different actors and organizations for different reasons. But this is not really a column about al qaeda.

Is Mara a mass pathology like al qaeda? Or is it mostly just a criminal syndicate? Is Mara a hierarchical organization?

Finally what should be done about Mara? Is Honduras’ heavy-handed tactics working? How will Mara be dealt with by American authorities? Will the patriot act be used against it?

All things to thing about.

Yes We Can!

Can't you just sense it? The world is saying, as one, as humanity we will try to help alleviate the misery of the Tsunami. A couple of observations.

• Yes A Early Warning System Will Work

I know that the key information is not seismic data it is ocean height and tsunamis are extremely long wavelength in the deep ocean and thus hard to detect. However I think this thing can be done for very cheap and should have been done a long time ago. I, Cringely had an interesting comment on this. I think its kind of arrogant and condescending when I hear people say, oh building this early warning system will be such a waste of resources. Those racist and classist (for lack of better words) fucks. Next time I hear someone say that I am going to confront them.

• Big Ben

I came across how ben rothingingaberger, you know that rookie QB for the stealers, how he gave his playoff check to the tsunami victims. I mean that is how you know this is something a little different. Of course he's hardly the only one, but still its Big Ben, he's a fucking rookie!


I hope that private money is more that public money that would be such a good thing. It turns out that people want to give more! Its the governments that are getting in the way. This is good in that in an ideal world this is how money would get allocated, its bad because this is not the real world we need experts to determine where the solvable problems are and how money can be best spent that’s the job of government. World government and all their black helicopters that is!

• Willing Redistribution of Wealth

But seriously I think we have just crossed an important line. People now realize that yes, we can do something collectively, we can solve the problems of the world or at least we can try. We have the internet! Lets do it. Let’s partner AIDS victims with donors. We can get antiretroviral paid for! Lets get some DDT and use it to save kids from malaria. Of course if problems were easy to solve they wouldn't be real problems. But I don't think that solvable problems that just need money need to go without funding anymore. Did you hear that Jeffrey Sachs? People are opening their wallets, you don't need to convince governments you fool! Take your case (and your web page) to the people!

LRA and Kony

This is going to be one of the stories of the year. It already has been one of the stories of the decade. It is full of Human drama and facinating personalities, and ultimately it is a story whose moral clarity is so blindingly clear that it is absolutly exasperating that it is so difficult to resolve. I feel conflicted for saying so but I hope Kony gets 'Savimbied.'

Links:
Richard Petraitis
(a little to much information for it to be 100% accurate (but what do I know), plus the author obviously has an agenda. None the less...)
Wiki (of course)

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