Food For Thought

- from gregmankiw.blogspot.com

Defense spending in the US is shrinking as a general trend in recent years...


...yet that budget is still the largest of any country in the world.

What's wrong with that?

Issues Back Home

R.I.P. Posi Noni (1961-2006)

The common name Friedman succeeds in capturing my attention. Thomas Friedman - The World is Flat. Milton Friedman - Permanent Income Hypothesis. So when lucid writer Milton writes an Op-Ed titled "Hong Kong Wrong", I invariably take some time out to read what he has to say:

Hong Kong's policy of "positive noninterventionism" was too good to last. It went against all the instincts of government officials, paid to spend other people's money and meddle in other people's affairs.

My question is: although politicians are paid to spend and meddle, surely there is an incentive to be paid and do nothing, given that there has historically been a grander justification than indolence. I am all for advocating a 'conspiracy' (if it's not painfully obvious) of PRC interference.

Mr. Tsang insists that he only wants the government to act "when there are obvious imperfections in the operation of the market mechanism." That ignores the reality that if there are any "obvious imperfections," the market will eliminate them long before Mr. Tsang gets around to it. Much more important are the "imperfections"--obvious and not so obvious--that will be introduced by overactive government.

A disappointment from Tsang. Is the introduction of the GST (Goods & Services Tax) such an action to "obvious imperfection"? Perhaps if the government is running out of funds for its lavish projects, it should reflect on whether it is being, as Friedman points out, overly active. "Broadening the tax base" seems a euphemism for not wanting to piss off the very rich. Instead, civil servants are worried that funds for their pensions are not secured, thus wanting to push the GST bill quickly through LegCo.

Administrative costs will reduce that revenue on a grand scale, and further decrease Hong Kong's allure as an investment location. From ordinarygweilo.com:

[The GST] will also mean (in theory at least) that if you buy goods outside Hong Kong you would have to pay GST when bringing them into Hong Kong - well, good luck with enforcing that at Lo Wu, chaps. As well as the extra civil servants need to collect and enforce this tax, there will be additional costs for private firms to administer and forward the tax to the authorities - and you can bet that these costs will be passed on to consumers. In addition, exporters will need to pay GST and then claim it back.

Not only will Hong Kong no longer be a "shining symbol of economic freedom", it seems that the prying fingers of Zhong Nan Hai are tightening their grip. The future of Hong Kong hangs upon several threads (connections in trade, human capital, economic prosperity); as they break one by one, and as we are scrambling to make feeble ones to keep it hanging, universal suffrage is crucial, and how HK negotiates that with China. Friedman's still waiting for a verdict:

The ultimate fate of China depends, I believe, on whether it continues to move in Hong Kong's direction faster than Hong Kong moves in China's.

I'm hoping to watch Wong Kar-Wai's 2046 in a few weeks.

Protectionism - Brought to a New Level

While the US and Europe are still widely criticized for stalling Doha talks with their insistent farm subsidies, and while the US Senate is still trying to pass the 27.5% tariff on Chinese imports, nothing tops the ridicule of this protectionist move.

An American school banned the wonderful International Baccalaureate (IB for short) because:

officials condemned it as "un-American" and Marxist, sparking outrage among pupils who are studying the increasingly popular diploma.

They also rejected it on grounds that it is anti-Christian (note: World Religions) and that it is "too foreign". Check this out:

Trombetta, the board member who has received death threats from angry parents, had further complained that the IB tests "were developed in a foreign country".

I understand the concern for maintaining AP's integrity, but as a country that prides itself on its Capitalist society and progress from competition, simply rejecting a foreign yet widely successful curriculum will not automatically guarantee the success of America's children. If anything, in this increasingly global and flat world, America's next generation will simply continue to possess their narrow world view that has not been beneficial at all.

Perhaps this kind of protectionism (preventing CNOOC from acquiring Unocal) is justifiable through strategic interest (though personally I think the Senate was just soiling their pants at China's surging power), but surely America's public, or those in power, should realize USA's comparative advantaage lies not in its farmers, its factories and mass production, or its standardized tests, but rather in its abundance of bright minds and resources, which it should channel towards the development of science and technology.

Without innovation, the US of A would falter in the 21st century.

Face The Music, Book Your Future

A few days ago, I was added as a Facebook friend by someone in HKU. First I was surprised, since I had no idea when facebook.com made its way to the Far East (only HKU for now). I've been expecting it to happen, and even jokingly suggested to a friend to be its Asian division programmer. Could've made a fortune. Or not.

Hong Kong has a large population, but as my sister points out, one always seems to bump into the same people now and then. Social circles overlap either majorly or not at all. Between university and secondary school circles, facebook is bound to be a hit, given as well the amount of time an average HK student spends in front of the computer. One hindering factor, on the other hand, could be the absence of facebook's hype and a holy history of the actual (paper) facebook.


Regardless of the site's success in my hometown, its popularity in the US has caused problems for students. Friends posting photos of underage drinking and hazing have led campus officers to break down parties and discipline students. Embarassing pictures are visible to people you've never met. Stalking cases have occurred from information posted online. Facebook is a fun site to waste time on, but many people are not aware of the perils of thoughtlessly sharing information. It takes only 5 minutes to set privacy levels appropriately to prevent trouble.

A word to the wise on this page a friend sends me:

Some potential employers — for example, many of those you meet at Career Services events — will be alumni, and are likely to look you up on Facebook. Count on this: Your chances of being hired by a company will be affected by your Facebook profile.

Another thing to keep in mind is this: information posted online stays there. Google, like many other search engines, caches webpages. Contact information, photos, profanity, groupings.

Use of profane, derogatory or offensive language does not reflect well on you. Think about it this way: If you wouldn’t use a word in a job interview or in a meeting with a faculty member, don’t put it on the web.

Advice on webposting doesn't get more concise than this:

Use common sense when publishing anything on the internet or visiting other web sites, and don’t assume that everyone you will meet on the web is a rational, law-abiding citizen who has your best interests at heart.

Unfortunately, people don't listen.

If You're Young and Not Left

you have no heart.

Being a lefty, an inevitable groan arises when faced with the comment "lefthanded people are more intelligent/creative/weird" from people using it as some sort of desperate conversation starter. The countless stories or assertions by enthusiastic mothers have trained me to be desensitized by these comments, despite the amount of truth or falsehood it consists.

Turns out that according yet another recent study by economists (supposedly trained statisticians), lefties (among college graduates) really do earn more than their peers.

Most "normal" people out there are probably thinking, "What a load of bs." Levitt (author of Freakonomics), a righty, thinks likewise:

Because I am not left-handed, I have never taken much pleasure in the endless parade of studies, articles, and anecdotes about how left-handed people are better at everything than right-handed people.

What's more, tall people also have an above average salary not because of societal preferences, height dominance or self-esteem building, but simply because they are - smarter (according to this study).

What a load of crap. I (6' lefty) will be the anomaly that proves the rule.

...if you're old and not right, you have no brain.

When I Look At The World...

You have dreams. You have ideals. You want to help. You want to make a difference.

That's all you ever wanted. Heal the world. Or just do something. Feed the malnourished. Vaccinate the sick. Educate the illiterate. Lend a hand to the handicapped, the elderly, the socially disadvantaged, the unfortunate. Give a leg up to immigrants, refugees, minimum wage families, the unemployed. Sounds so good and altruistic, doesn't it?

Well, it never is as easy as it sounds. Nothing ever is. I certainly haven't heard of anything that is. Perhaps I'm just skeptical. I used to be idealistic, in the not too distant yet already far away past. I still am, but reality runs you over, mashes you up the way a bullet train grazes through hamburgers.

Selling girl scout cookies? Raising money for a breast cancer fund? Keeping old people company? Doing immigrant children's homework over the phone? Maybe it helps. Maybe it doesn't. And I'm probably leaning towards the negative. Why?

3 reasons: high OC, dramatic BP, and often unattractive LES.

Opportunity Cost - volunteers waste an exorbitant amount of their talent and time in the process of charity work. Smart volunteers could usually effect more change through the inherent job nature or simply by donating their high wages The humanitarian efforts are worth something if and only if the program or project is run in an extremely smooth manner - which rarely happens.

Bureaucracy & Politics - charity organizations, like any other sizable group, have plenty of administrative problems to worry about, yet they lack the quintessential incentive to maximize productivity since they are often non-profit parties. They usually attempt to have many layers of decision-making in order to divide up the labor, yet more often than not result in completely pointless job titles and altogether ineffective governing.

Leadership Efficiency Scale - only idealistic yet intelligent people can mold volunteering into a worthy (aka profitable) venture. And those people choose (based on  the 1st reason) to contribute through other channels, perhaps due to the high level of investment (and low return) required at the beginning stage. Moreover, resources (both human and monetary) are almost never devoted in the most efficacious way possible, where help is needed the most or where the most help can be done. Even charity follows 'Economies of Scale'.


My lesson from Pinghu : Summer 2006.

Compassion alone is not enough.

Googlopoly

The question of whether Google will become the 'next Microsoft' is interesting. Bill Gates stepped down from his Microsoft post, conceding defeat to the combined efforts of Apple, Mozilla, and Google. Despite still having the majority market share in the OS and Browser business, Macs and Firefox are gaining bit by bit on a slippery slope, while it goes without saying that Google is winning the search engine race by a mile.

Microsoft is viewed as an evil monopoly and even accused of anti-competitive practices mainly because it bundled IE with its operating system, kicking Netscape out of the game. All services that Google provides is optional; alternatives exist if you choose so. On top of that, all the tools are free. Most of Google's revenue is fuelled by advertising, and to a smaller extent corporate search and Pro versions of software.


The fundamental line dividing monopolist Microsoft and Google is the company nature. Google's motto is "Don't be evil", and with their brilliant minds and philanthropic mission, the track they are on is unlikely to lead to a monopoly. The way they maximize revenue is just like any other Internet company, only much better. Provide the best products for free, attract the most internet customers, which guarantees an immense amount of advertising revenue.

Competition (if perfect) will solve problems of monopoly, eliminating inefficiencies. Google competes with many different companies on many levels: as a web portal with Yahoo, in video with YouTube, in online transactions with PayPal, in VoIP with Skype, and countless others. From the start Google has been involved in providing a smooth user experience, focusing their visionary efforts on what people really need.


By contrast, Microsoft devoted itself to maximizing sales revenue, capitivating on its dominating market share with lacklustre products. Vulnerable releases and lack of foresight signed their death contract. Justice is doing its work, and the invisible hand is pushing them out of the game unless they give the masses what they want. Otherwise, people will depend increasingly more on Google and its web services, or choose to get a Mac for its smooth, synthetic usability and quick out-of-the-box experience.

Googol means 10 to the power of 100. With Google, there is hope for a Googlopoly, tending towards what economists would call 'Perfect Competition'. Thank you Invisible Hand. Life just got better.

Cross, Crescent, and Crystal

Israel and Palestine joined the Red Cross today, after 100 years of symbolic dispute. This kind of ideological debate often stands in the way of an ideal, efficient world. The ideology is also what keeps us living in the first place.


The Telegraph reports:

For about 50 years the Israeli society had been excluded from the International Federation of Red Cross and Red Crescent Societies because of its insistence on using a red Shield (or Star) of David.

Ethical (or bureaucratic) ideology is just as prevalent as the religious kind.

At the same time, the Palestinian Red Crescent Society was excluded because the movement's statutes permitted only relief societies from sovereign states to join.

So much easier this way. Now they've finally agreed on a neutral symbol. One in which they'll insert the Cross/Crescent at the appropriate settings.

The so-called "Red Crystal" - a red square standing on its corner - will now take its place alongside the Red Cross and the Red Crescent as an internationally-recognised humanitarian emblem.

I wonder what the symbol for Hospital will become?

Ooooogling at Gooooogle

I love Google.

Google is the one and only reason why I would, had I not switched to a Mac, still be using a PC today. It has made the Windows experience much more bearable amidst the ubiquitous viruses, security flaws, and general unamicable user experience.

Before I switched a little bit more than a year ago, Google's search engine was a knowledge haven, Gmail was just gathering momentum, and Google Desktop's beta was so much faster to look for things in your computer. Image search and Froogle (shopping search) were both available and useful, but so many Google products have come out of Beta since then that it's absolutely mind-boggling.

Do you know them all?

In terms of search and the web experience, most people know about the Maps, Books, and Video, but few (academics and students) know about Scholar. You can search Blogs for personal takes on issues or an independent stance, or News for professional op-eds. Or if you just want to see the world, flying across the globe is now much easier (and cheaper) than crossing the duck pond for 17 hours.

But what really made the PC user experience phenomenal is all the software made available to the masses, by none other than the legendary "Don't be evil" Google.

For email, there is virtually unlimited storage at Gmail. For photos, I'm enviously drooling at Picasa's new webhosting feature as well as its old sharing program, even though iPhoto is bundled with the iLife suite. For communication, you can talk, talk and talk (or type) with Google Talk. For organizing your life, use the virtual Calendar, and as for bullshitting, they have this.

Their labs churn out amazing products, if you like procrastinating, being cliquey or are an SMS addict, Google is your best bud. But their smartest decision was to acquire other smaller companies. Keyhole, Picasa, Hello, and best of all, Sketchup, the completely free 3D modelling software for poor idealistic architecture students.

The purchase is only one of many. This other one is the first step towards taking over Microsoft Office's monopoly.

For word processing there's Writely, for spreadsheets there's Google Spreadsheets. Makes it so much easier to collaborate online, lifting Outsourcing to another level. Want to publish webpages in 2 clicks? Check out Google pages. It's the PC version of iWeb.

As for upcoming products (developing in the refinery) I personally adore Google Trends for comparing the most mundane things. I haven't tried the online Notebook yet, mainly because I believe it's only available through Firefox, like many Google products. And there are dozens more that I opted not to mention. Just think that all of that came about in one short year (or two if you will). And there's more and more coming up. Watch out for Gbuy, the Paypal nemesis. As for Google's not-so-secret weapon: data centers, warehouses of processors and disks are popping up like mushrooms as Microsoft and Yahoo try desperately to keep up.

"Google has constructed the biggest computer in the world, and it's a hidden asset,"

Today, it's Google Earth's 1st birthday, Shakespeare just joined Google, and the Internet will be run by Google WiFi.

Cups and Bucks

The World Cup frenzy is all over the world. Which team will get to carry the biggest honor of their lives home, and which others will have to settle with a 3-minute cup? Even if you're not into spectator sports, or any sports at all for that matter, you may still find it impossible to distance yourself sufficiently enough from the all the hype.

Intense speculation from gamblers and non-gamblers alike have often led to interesting outcomes. Brazil is by popular opinion the big 'hot door', but personally, it is quite likely that this will happen again.


For those with economic flair and an interest in soccer, you might find Greg Mankiw's Blog: The World Cup to be stimulating.

Goldman's figure...shows a strong correlation between World Cup ranking and GDP per person. Being rich and having a good team go hand in hand.

According to this list, the countries up there do indeed have a higher FIFA ranking. Heck, when the US is 8th in GDP per capita and 5th in FIFA rankings, what can you say? Yet, *surprisingly* Luxembourg tops the GDP ranks but its soccer team is nowhere to be seen.

The other anomaly is that Brazil ranks 74 in GDP per capita and Argentina is 67th, while they are respectively the 1st and 9th in the FIFA rankings. Interesting of note, however, is that the rankings for total nominal GDP for Brazil and Argentina rise to 11th and 34th, which better reflect the general correlation between Football (Soccer) performance and having the big bucks.

The general correlation seems to ignore the outliers and obliterates the question of causality. Even though there may be plausible theories related to opportunity cost, income effect, substitution effect and so on, the biggest factor in play here is customer preference. In some places, people love football. They live, feed and die on football, while Americans misunderstood it as another sport and funnily enough, enjoy bumping into each other all the time.

Finally, a few pointers from Elaine on how to choose a team to support (especially if you're a 'football widow' AND all of the above bores you AND you managed somehow to survive till here). My favourite is this:

8. support the team wearing your favourite colour

unfortunately it could be a bit rare to come across a team in pink.

A Changing World: Good or Bad?

Ever felt that when browsing through Wikipedia looking up one thing, you end up learning about something completely different? Or am I the only person random enough to surf aimlessly for information?

Thanks to Web 2.0, I get this uneasy feeling that advances in Internet technology is only contributing to increased amounts of internet procrastination, affecting especially those budding minds of young college students. Under the broad umbrella term of interactive websites, those that above all focus their free time on forming links and relationships among youngsters or students, have become increasingly a magnet for procrastinating teenagers (e.g. Me) and a source of unproductivity.

(See this list for some of the culprits.)

It is undeniable that not all of these sites do only harm. LJ, Xanga and other blogging sites provide a completely novel way for young people to vent, to express, or to opine, not that many of them do more than rant randomly about how life sucks (again, e.g. Me). However, it isn't the first time that I'm complaining about how some people profile themselves so freely on the no-longer-neutral Internet.

"...telecommunications and cable companies will be able to create toll lanes on the information superhighway... This strikes at the heart of the free and equal nature of the internet."

Not only that, but has anyone any idea what others do with their profiles? Perhaps this would scare you off. Or maybe you'd be indifferent. I opt to proceed with caution. No unrestrained advertising of personal information when the NSA is snooping around for my every move.

By adding online social networking data to its phone analyses, the NSA could connect people at deeper levels, through shared activities, such as taking flying lessons. - New Scientist

Maybe an American is willing to give up some privacy in the name of National Security, but to me, they're just masking a non-stop slippery slope all the way back to 1984. Perhaps it's my panicky self after watching 24, but I'm not surprised if the PRC equivalent isn't worming its way into HK networks. Not even if they've already established the foundations for a Great Firewall - HK.

Are you reading this?

I read many things that interest me that would otherwise seem like a waste of time to many others. This is one of them.

News nowadays is transferred through both traditional and modern media. People still read newspapers & magazines, listen to the radio, and watch news reports. But other people, usually those half the age of the first category, receive their news from elsewhere. 'Internet' is only an umbrella term. There are websites from Reuters, CNN, BBC, or NYT. There's Google News, a portal (*cough* computer program) consolidating content from across the web. There's Wikinews, self-published and community-monitored news from anywhere, anytime if you think it's important. There are Blogs if you feel self-righteous or protective about what you write.

New forms of news have popped up across the world (at least the wired part, that is). I didn't come across News.com until today! And it's great in that it not only writes great editorials but also has a 'Big Picture' function informing you of how all the news is related, like this particular piece.

You know how Google News ranks news according to relevance? Well, there's this new site digg.com that doesn't rely (*cough* trust) a computer algorithm tuned by Google's computer engineers. It allows users to submit relevant stories and also to vote on which ones they think should be the headlines, rather than let some authoritative editor to do the job. Remember how Wikipedia lets YOU edit whatever content you feel is incorrect? Guess what? You can do that even to websites! Check out Wetpaint.com and what they can do.

It's fascinating and wonderful how in the world now we are no longer limited to news that people feed into our mouths (though some still opt for that option), but can pick from an assortment of Social, Wiki, and Personal media. But don't forget, when you're browsing happily, that there are people who do not have the same rights that you do, however close they may be.

Friends, in China, you can't even use Gmail. In China, you can't access Wikipedia. In China, any politically sensitive blogs even remotely related is filtered, censored, or blocked. Reflect on that. Cherish the freedom that you possess.

Manifesto

Today, I have a dream. A dream that I will become hardworking, once and for all. A dream that laziness will be a fragment of the past, a wisp of shadow, never to be seen again. A dream that I will be organized, procrastinating only when I can afford to with ease. A dream that I can sleep, as long as I want to, whenever I want, and eat, however much suits me. A dream that I will write with beautiful eloquent prose that hits everyone with the force of a bullet train. A dream that my thoughts can be organized when verbalized. No more jumbled up mash potatoes. "Je veux bien articuler". And the dream of all dreams? The dream that everyone who is using Xanga will switch to Google's Blogger, and rational people will realize the Mac is superior.

Needless to say, I am a Die Hard Google-Apple fan. But alas, life is but a dream.