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Thursday, January 4, 2018

CEO Pay: American and European Values

To what extent do inequalities in wealth accrue based on structural elements, such as tax deductions that only wealthy people can use, as distinct from factors pertaining to individuals, such as talent, sacrifice, and effort? The two clusters can build on each other, as people who have become rich primarily by exercising a talent and working hard use some of their accrued power to “reform” the system to their advantage at the expense of the poor and middle class. Such structural reforms in turn can make it easier for wealthy people to become even richer. In the context of a society in progress, structural and idiosyncratic factors doubtlessly interact—the trend being of an increasing chasm between the rich and poor. 

The full essay is at "CEO Pay in Europe and America."

Political Psychology: Syrian Human-Rights Abuses

According to the New York Times, “masked gunmen severely beat Syria’s best-known political cartoonist,” Ali Farzat, on August 25, 2011. The attack came days after he had published a cartoon showing Bashar Assad hitching a ride out of town with Qaddafi. To be sure, it seems foolhardy for the cartoonist to have published such a cartoon in Syria unless he meant it as an act of non-violent civil disobedience. If the latter, willingly taking the beating without hitting back would be of such moral fortitude that the injustice of the regime would be made transparent and discredited. How moral strength can overcome physical force is a point on which Gandhi had much faith.

The full essay is at "Syrian Human-Rights Abuses."

Banking on Buffett’s Bank

Beyond wondering what could Ken Lewis have been thinking when he ok’d Bank of America’s purchase of Countrywide, it might be worth pondering why the Dodd-Frank Financial Reform Law of 2010 did not mandate splitting up banks such as Bank of America, which with over $1 trillion in assets are too big to fail. In other words, is simply increasing their reserve requirements tantamount to gambling with the financial system in a reckless manner? Should the elected representatives of the people and the states in the U.S. House and U.S. Senate, respectively, have displayed more fortitude in resisting the banking lobbyists even when that industry was known to have been culpable in the 2008 credit crisis?

The full essay is at "Banking on Buffett."

Wednesday, January 3, 2018

Royalty: Natural or Exaggerated?

On April 29, 2011, the world watched in utter fascination as a crown prince in one of the E.U. states married a wealthy commoner in London's Westminster Church--the same edifice in which Queen Elizabeth had married in 1947.  The prince is of course William, and his bride is Kate (or Catherine to the purists), who in one hour's time went from being the daughter of two wealthy commoners to royalty.  It is as though she leap-frogged from “the many” past “the few” to join “the one”--the firm. My question is whether these distinctions, involving birth as well as wealth, are natural in terms of human nature or exaggerated artifices borne of excessive privilege and power.

On the "Wedding of the Century": History Made or Manufactured?

In hyping the royal wedding of William and Kate in the E.U. state of Britain, the media even in other E.U. states applied the title, “The Wedding of the Century” in spite of the fact that the century was only in the second year of the second decade. It is rather presumptuous for people alive at such a time to claim so much for their time, and therefore for themselves. Lest our self-constructed bubble unexpectedly bursts, we might let some air out of our self-constructed balloon in a controlled manner such that our bloated egos can survive without too much bruising.

The full essay is at "Wedding of the Century."

See related essay: "On the 'Wedding of the Century': Royalty as Natural or Exaggerated?"

American Foreign Policy on Pakistan: Balancing Foreign Aid and Duplicity

Osama bin Laden “lived and died in a massive, fortified compound built in 2005 and located on the outskirts of Abbottabad, some 60 miles from the capital of Islamabad. It stood just a half-mile from the Kakul Military Academy . . . and close to various army regiments. . . . (C)ongressional Republicans and Democrats questioned whether bin Laden was hiding in plain sight, with Pakistani military and intelligence operatives either totally unaware of his location or willfully ignoring his presence to protect him."  Had it been smart of the U.S. to extend foreign aid to Pakistan?  That is, does this case point to the futility, even weakness, that attends foreign aid in general? 


East Asia and Latin America: Economy & State

In the fall of 2011, the economic troubles in the developed countries were starting to hit fast-growing developing economies like China, Brazil and Indonesia. The governments of the developing countries were “girding themselves,” according to the Wall Street Journal, “to offset any economic and financial damage.” China’s government, for example, increased the investment of its sovereign wealth fund in Chinese banks. In September, China’s exports to the E.U. grew at 10 percent, compared with 22% in August. China’s increase in imports was also weaker, which did not bode well for emerging markets in Latin America and elsewhere that supply commodities for China’s construction industry.  Yet IMF projections depicted an interesting distinction between the projected increase of real GNP in Latin America and the developing Asian economies. The projections for 2011 were 4.7% and 7.9 percent, respectively. For 2012, the projections were 4.0% and 7.7 percent, again respectively. What can explain this pattern wherein Asian newly industrialized economies (NICs) were expected to fare better?

The full essay is at "East Asia and Latin America."


Alex Frangos and Patrick McGroarty, “Troubles of West Take Toll on Emerging Economies,” The Wall Street Journal, October 14, 2011. 

Federalism & Business: States in India Deregulating for Economic Growth

The gross domestic product in India for the year ended March 31, 2011 was estimated to have grown at a robust 8.6%. Gordon Chang at Forbes argues that besides Delhi’s own fiscal and monetary stimuli, competition between the states of India for business has been a formidable factor. Federalism, it turns out, can be good for business—yet at what cost? Chang omits this element, writing only that “As the states try to outdo each other, India’s investment climate improves.”

Automatic Standing: The American States in Federalism Cases

Unlike that of the E.U., the U.S. system of public governance is structurally biased toward  political consolidation at the expense of federalism. In fact, the bias extends to jurisprudence. This is evident in a ruling by the U.S. Court of Appeals for the Fourth Circuit on September 8, 2011 against Virginia on the 2010 federal health-insurance reform law.

The full essay is at "Spending in American Federalism."