What is you label?

March 2, 2009

Labels are for cans, not people.
~Anthony Rapp

I was having dinner last night with some friends, and the conversation moved to political stances, neo-hippies labels, and driving cars. One of them even told me that he can see who I am referring to when I write in this humble media.

I assure to my rich readers (breaking the 150 a day record!) that I never have someone in mind when writing, unless I actually say so. The interesting part of the conversation was when another friend asked me how do I label me. “I am above labels” I answered, “everybody has a label” she replied.

According to one test I took in Facebook, I am a class-3 liberal. That means nothing when you can be a Class-10 liberal, or even a Class-10 conservative (Horror!). But I find more often than not that lot of  people like to put labels on themselves, and those labels, though providing a sense of belonging, limit their ability to think (note: I stopped talking about my friends here, do not send me hate e-mail!). I find people in the streets that join causes just because they are liberal, or because they are perceived as “just”, without further thinking. Can you be a liberal and a conservative at the same time? Can you be a leftist with a brain, and a rightist with a heart? Let’s ask ourselves the following questions:

  • Can you be pro gay marriage but against abortion?
  • Can you be socially liberal but fiscally conservative?
  • Can you support the efforts in Afghanistan but be against the Iraq campaign?
  • Can you give money to the World Wildlife Foundation while hoping that the guys at Greenpeace get soon real jobs?
  • Do you support welfare programs but are against a big government?
  • Can you drive a car but at the same time be an ecologist?
  • Do you think that a biker that rides on the side walk, run red lights, and go against traffic is actually worse person than a driver that obey the law?
  • Can you support genetically enhanced crops and still think that organic crops have a place on the market?
  • Can you be a meatarian but support vegans?
  • Can you work on Bay St (Canada’s Wall St) and still support the ideals of Mohammed Yunus about banking to the poor?

If you answer to YES to more than three questions, I welcome you to the unease world of thinkers that do not know all the answers, but actually may make a difference. The world is more complex than simple labels make us think!

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He’s Back

May 4, 2007

I don’t know what the problem is, but I’m sure it can be solved without resorting to violence.
~Arnold Schwarzenegger

I really don’t like the guy too much. His positions against illegal immigrants are tougher than they should be, given the dependency of his state on illegal, cheap labour. He ducked all charges of sexual misconduct, and he is really a bad actor. But I have to give it to him, he is a good environmentalist.

When he took office in 2003, Schwarzenegger announced a plan for improving the state’s air, water, landscapes, energy supplies, and climate. He created the 25 million-acre Sierra Nevada Conservancy to preserve California’s iconic mountain range. He also established thousands of acres of ocean parks, and spend millions for habitat restoration, fisheries management, and pollution reduction.

Arnold

He adopted the most aggressive greenhouse-gas-reduction policies on earth, including ordering the state government to slash its energy use 20% and providing $3.2 billion to put solar roofs on homes and small businesses. By 2020 one-third of California’s electricity will come from renewable sources like wind, biomass, and the sun.

What I like the most is how he has fought off the Bush Administration’s efforts to weaken California’s global-warming initiatives and drill for oil along the coast and in the state’s national forests.

The Governator regards environmental injury as deficit spending: loading the cost of this generation’s prosperity onto the backs of our children. Schwarzenegger believes that good economic policy, over the long term, is always the same as good environmental policy. He is quite the conservative, but he is doing more good to the environment that a lot of liberals.

And I have to agree with that.

(All data taken from http://www.time.com, caricature by Chris Rommel)


Non-Conformist Conforming II

March 9, 2007

Non-Sequitur

by Wiley Miller


Wealth Gap and Ecological Footprint

September 29, 2006

The rich will do anything for the poor but get off their backs.
Karl Marx

I have left out something important before talking about green consumers and some other economic law’s application: The need of a more equal world. I know this may sound like some kind of leftist moralistic dogma, but there is an economic truth behind. Please keep reading.

In the middle age, all the countries were poor. I am not talking about poor for today’s standards, I am talking about lack of health, short life spams, no roads, no communications, illiteracy… the world was dominated by a few very rich people and the knowledge was guarded by few scientist and monks. This was the feudal system was on and everybody was in pretty much the same poor condition. Enters the bourgeoisie and this changes; a new class is born of merchants and traders. Then the industrial revolution created, in the 1700’s a new powerful class of industrial men and the beginning of the modern world.

These milestones didn’t end the disparity. The gap between the rich and the poor continued to growth and today remains an issue. As a rightist, you may say that yes, the gap is still there, but everyone is growing! The poor of today are rich when comparing with the poor of 100 years ago. All the countries are growing in the long term and people complaining are big girl’s blouses. You may even show us the World Economic Outlook from the IMF and point out a graphic showing the growth of almost all regions in the last 35 years:

Per Capita Income Growth

So, with the exception of Africa, everybody is growing! So, what if the Industrial Countries are bigger? Who cares?

The world is designed to hold so many people. We are currently 6 milliards (6,000,000,000) people. That is a lot of people! Now, the world surface that is able to sustain human activity is 10.8 billion of what we’ll call biologically productive global hectares, so there are 1.8 BPGHa per person in all the world. In North America, the average Mexican needs 2.5 BPGHa, the average Canadian 8.8 and the average US resident 9.6.

I did the test that the Earth Day Network has developed to calculate your personnel footprint. The results are sad for a poor recent grad!

Manuel's Footprint

So, my lifestyle is preventing at least two other persons to live with the minimum basic shelter, food and service. Of course, living in Canada, with the miserable winter, demands more resources that living in Costa Rica, but thit is what we get for living where the wind turns back. There are still so many places, like California, with milder weather conditions and 33 million cars for 35 million people.

So, the wealth gap is no more than stealing natural resources from the third world. The wealth gap is not sustainable and should be addressed before it is too late. That doesn’t mean that we all have to live like Gandhi to cut the gap, but there are more sustainable ways of living that, while keeping us comfortable, helps others to reduce their poverty.

You still don’t care?

Well, the wealth gap also means the following set backs for the rich economies:

  • Exporting social injustice,
  • Illegal immigrants and terrorism to other nations, as well as the goods.
  • Extinction, deforestation and social unrest

These problems affect us at home. Even if we dismiss all the implications of social injustice and inequity, the effects can be felt on our homeland.

 

 

 


Exercises on Fair Trade

September 22, 2006

 

Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.

Margaret Mead

I will start now applying some of the economic theory I talked about in previous post, but before, maybe you are ready to start doing some research on Fair Trade, before I start babbling about it.

As early as 1867, Karl Marx wrote in Das Kapital about the exploitation of the bourgeoisie over the workers. R. Janssen (1997) wrote about the feasibility of fair trade as an alternative way of trading. Ian Hudson and Mark Hudson (2003) wrote about the need for consumers and producers to know each other and the importance of fair trade as a mean to recognize that a product has certain impact on the way its produced that the merely price on the shelves.

R. Mendoza (2000) and D. C. Zehner analysed the economies of fair trade and followed the route of the fair trade primes, being the first that proposed that fair trade is an inefficient subsidy transfer. Paul Rice has written a series of articles promoting fair trade from the humanitarian side, but since he is chair of Fair Trade USA his work is in favour and lacks critic on the system. Francisco van der Hoff has make contributions on the rules of pricing a fair trade produce, especially coffee.

James Bovard (1991) has called fair trade a myth and declares that it’s a barrier for commerce and a subsidy from the rich countries to the poor, while analysing the legal system of trade, barriers and tariff that rule the world. Brink Lindsey (2004) makes an analysis on how the international price of produce is affected by efficiency in some countries and propose that low prices are result of natural market rules and not clash of classes. Ken Peattie (2001) writes about the green consumer and cast a light on the shades of marketing for the social and ecological conscious.

If you are interested in the Academia, these lectures are very recommended and post both views of the same problem: the poverty and ways to correct the imbalance.May we all benefit from their research.


9/11 1973

September 12, 2006

“There is a new empire in town”

Laurence M. Vance

My September Eleventh:

There are times when the Right clashes with the Left. I am not talking about the academic clash, with an endless discussion about economic theory, or Human Rights. It is neither the usual clash in the elections times, or the demonstration against globalization in Seattle , Québec, Cancun.

I am talking of the darker times of the Right against the Left that warmed the Cold War. Once Upon a time, in South America, the people dreamt about a change. With 34.9% of the votes, Salvador Allende won the elections in Chile against Jorge Alessandri, who just got 27.8%.

Feeling that the close margin was not an impediment, Allende began to nationalize everything he could. He started with the land. The peasants invaded private property while the government did nothing. The copper mines quickly followed; Allende called an old decree from 1932, and the Socialist government started to nationalize the industry, affecting the powerful American interest.

Allende felt invincible, then he nationalize the copper mines of Anaconda and Kennecott. That was the point of not return. Richard Nixon decided to get ride of Allende for good. Edmundo Pérez Zujovic was assassinated by the socialist forces (Vanguardia Organizada del Pueblo), and the police did nothing. Allende ignored, maybe naively, maybe on purpose, all the economic law and international rights that he could used to better serve his cause and to create a real Social-democratic government in the Andean country.

In March, 1973, Allende lost the control of the congress, so he proceeded to veto all the new initiatives that could helped to save the regimen.

September 11 1973. A military coup, leaded by the CIA, took place. Bombarding Santigo de Chile, Augusto Pinochet took the power. Thousands of Chileans were tortured and murdered. 18 years of Right dictatorship followed three years of democratic socialism. The Right acted brutally and merciless. Chile had to wait until March 11, 1990, to elect a new president, the Social-Christian Patricio Aylwin.

The clash of Right and Left. USA served the bombs, Chile the deads. The justice was left unserved.


Supply and Demand and some Left Myths

August 30, 2006

“An economist is a man who states the obvious in terms of the incomprehensible.”

Alfred A. Knopf

In order to clarify some myths that both Right and Left proffer, we need to review some basics of economic law. I know you know them, so I will be brief and hope not to bore you to death. The most basic economic law is also the most ignored: Alfred Marshall’s Supply and Demand. The law is very simple, at a given price, the consumers are willing to buy so many articles:

sdpic1.jpg

This is call elasticity. As the price increases, the consumer is willing to buy less; as the price decreases, the consumer is willing to buy more. The more sensitive is the consumer at price changes, the more inclined is the line. The second part of the law is that, at a given price, the producers are willing to manufacture so many articles:

sdpic2.jpg

I talk about manufacturing, but of course this is also applicable to agricultural products and services. The process is that these two forces interact to define the price: Where the supply meets the demand is called equilibrium point or market clearance:

sdpic3.jpg

We can expand on this model. First at all, the lines are not infinite. There is a minimum price that the producer will ask in order to start offering the article or service that will cover the costs and yield a profit. There is a maximum amount that the producer can offers due to installed capacity, so, the producer line is limited in those ways:

sdpic4.jpg

The implications are the same for the consumer, there is a maximum possible price to pay for a product (let’s say, the total income that the consumer has available) and a maximum quantity that the consumer will get, even if the product is free (for example, who wants 2,000 kilograms of potatoes for his small urban apartment):

sdpic5.jpg

To complicate more the model, the line is not a line, but a curve. Elasticity tell us how the quantity of a product, produced or purchased, changes according the price. Let says we want to buy shirts to go to work, and the price of a shirt is $20, at this level, we will buy 3 shirts. The value of the shirts market is $60.

<>If scarcity comes and the prices goes up at $40, we will buy only one shirt because we want to wait if a sales comes or the prices go down again, in this case, the value of the shirt market is $40. Now let’s says that instead of scarcity there was overproduction and the price of a shirt goes down to $10; it is so cheap that now we want a different shirt for every working day of the week and two for going out the weekend and buy seven. Now the value of the market is $70:

sdpic6.jpg
The curve is more rounded in the first set of prices and is smoother in the second, as the total price increase get closer to out maximum budget. Elasticity is not the same along the curve, the higher the price, the more sensitive (elastic) the market. This of course is not always the case, some goods, like diamonds, increase the demand as the price increases, but remember, I want to keep it brief.

A final complication is that at certain level of prices, the curves may not meet:sdpic7.jpg

In this case, if the producer wants to sell, it will have to be between the ranges of P1 and P2, but will never sell the quantities desired, which will lead him to leave the market.

This one, as any model, is based in certain assumptions, the most important of all is that exist perfect information:

  • All consumers and producers know all things.
  • About all products.
  • At all times.

We will come back alter to this, but if the assumptions hold true, then we have perfect markets, and this model shows us several things that happen in perfect markets condition, that takes away some of the myths that dwell on the Left:

  1. Prices are set in the market, not in an obscure room by conspirators.
  2. The public is willing to pay the price. No one is forcing the price in the market. There is no need for price control.
  3. The producers are willing to produce the quantity Q at the price P, so there is no need for subsides or special considerations for the producers.

So, I know it doesn’t sound very socialist from my part, but in my next post, I will talk about the myth that the Right uses in some of its arguments: The existence of perfect information and perfect market conditions.