Lobbying against development

It's incredibly difficult to face the farm lobby in developed countries. Farmers have large networks of friends and relatives whom they convince of their position. They don't take international development into account, focusing instead on their situation. Who can blame them?

Inequality creates poverty

Two centuries ago, kings would not have refrigerators nor cars or hot tap water. But they were not seen as poor. This shows how poverty can be a relative matter. In this world of perceptions, inequality can be the cause of poverty. This Business Week review of a book by Benjamin M. Friedman, The Moral Consequences of Economic Growth, highlights this issue:

As Friedman notes, there is plenty of evidence that people judge their
well-being by comparing themselves to others. As the average income in a country goes up, so do expectations. As a result, the level of GDP per person in a
country, taken alone, doesn't necessarily say much about the level of happiness.

This should be kept in mind when talking about raising income per capita. Some say that as long as the poor gets richer, we shouldn't worry that the rich get even richer. Actually, we should: we're creating poverty.

(from the World Bank's PSD Blog)

Debt relief doesn't mean more aid

I've never been a fan of debt relief for poor countries: it's rarely an increase in foreign aid anyway.

"The debt relief deal, though welcome, will only generate $750 million a year in
new foreign aid - that is a 1 percent increase in total aid, assuming governments do not take the money out of the budgets of existing aid programs."
"Ranking the Rich 2005", Foreign Policy, September/October 2005

Well, they do. At my job, I've seen it first hand: a government has cut its budget to a development bank because the recent debt relief had been too costly. They had to find money somewhere else - within the official development assistance (ODA) budget, that is.

Funny to see how many self-righteous countries are actually ranking lower than the US: France and Spain at the forefront. Yes, they both beat the US hands-down at ODA as a percentage of their GDP, but this ranking clearly shows that many more factors impact on development.

Old News on US Media - Still Relevant Today

It's old, but this study (original press release) is priceless to understand how the American public can be spinned by Fox and right-wing medias. It basically says that Fox viewers were mislead into supporting the war in Iraq.

For each of the three misperceptions, the study found enormous differences
between the viewers of Fox, who held the most misperceptions, and NPR/PBS, who
held the fewest by far. Eighty percent of Fox viewers were found to hold at
least one misperception, compared to 23 percent of NPR/PBS consumers.

How you can still believe your own spin after having to lie so much to promote it - it beats me.

Miers Withdraws - Hurray, say the liberals

Mier would have been as conservative as expected from a close ally of Bush. Let's hope the replacement will come from the mainstream (hum?). But let's keep this post short: the news is most likely meant to divert from real news.

Inequality: the most censored story of 2005

Wealth inequality is the most censored story of 2005, according to Project Censored. I'm pleased to read this - the effects of inequality is one of my main interests, and happened to be the subject of my thesis, not so long ago. It's fascinating that something seen as morally reprehensible, but no more, has actual effects on economic growth, health and politics to name just a few.

Look out the profile of Project Censored. I will have a look at the whole top 25.

Project Censored is a media research group out of Sonoma State University
which tracks the news published in independent journals and newsletters. From
these, Project Censored compiles an annual list of 25 news stories of social
significance that have been overlooked, under-reported or self-censored by the
country's major national news media.

Not enough US aid - and shame on the Italians!

I'm not sure it's good news:

In the 1970s, 70 percent of resource flows from the United States to the developing world were from official development assistance and 30 percent were private. Today, 85 percent of resource flows from the United States to the developing world are private and 15 percent are public. (Source: USAID)

Many interpretations of this are possible, one of them being the reduction of public resources flow. And the data from the OECD tends to corroborate this. The US have just been beaten to the post by the Italians for their greediness in international aid, but they held the last place for quite a while in the past.

And private resource flow have a very different pattern than public ones. It tends to go to richer regions where the yields are higher. It has different goals: promote a business or an ideology. And if it's US, chances are a lot of it are faith-based. You may think it's a good thing, but to me, centuries of missionaries make me doubt that promoting religions are a good cause.

Sacred cows

Ah, finally, some good news.

The cows have had a pay rise. Calculations by Oxfam's Duncan Green for 2003 show that the average cow in the Dordogne or Lower Saxony can expect to have $2.62 a day lavished on it. (The Guardian, Monday October 17, 2005)

What I like about the agricultural subsidy issue, it's that it's not so clear cut as it appears. Some developing countries actually benefit from subsidized agricultural products from the North and would be worse-off without them.

Banquette

La microfinance, ce n'est pas de la charité. Le crédit peut avoir le même bénéfice dans les énonomies émergentes que dans les pays riches: fournir les liquidités pour lancer une entreprise profitable. Et les systèmes de garantie sont intéressants: on prête à un groupe plutôt qu'à une personne et, comme tout le monde est responsable collectivement de rembourser le prêt, c'est la pression sociale des pairs qui fait que le prêt est remboursé.

Reste à voir comment les banquiers vont approcher la microfinance. Il faut parfois faire preuve de flexibilité et considérer les conséquences du remboursement d'un prêt. Dans ces pays, quelques dollars par mois font la différence entre la vie et la mort.

Philanthropy is bad (in some ways)

Has Google become the bad guy?

After complaints on privacy, Googlebombing, and now the authors, Google's star is not as shiny as it used to be. In what may be an attempt to revive its faded colors, Google has launched its foundation not long ago: Google.org. The problem is that, with $1 billion, it's underfunded for such a large and successful company. The Bill and Melinda Gates Foundation has an endowment of $28.8 billion. A quick computing tells me that it's... it's, hum... 28.8 times more than Google. Second, there's barely any information on their homepage. How have the first commitments been decided upon? What about the next ones? Is there any transparency? Do we have reasons to be suspicious of the goals pursued?

Why would I need to know?, would you say, it's their private money after all. First, if they want me to be impressed, they should reassure me that they haven't given their money to their friends to build some race car. Second, this lack of transparency is one of the many problems with philanthropy. Goodwill people give their money, thinking that it will be put at good use, but accountable mechanisms are missing. We're asked to believe in foundations.

Americans are proud of their philanthropic tradition, but I see very little reason why. It's people who have more money than they can spend who decide to buy what can't be bought (you'd think): respect and admiration. But what bothers me the most with philanthropy, is its arbitrariness. People make harsh and too often unjust judgment of who deserves to receive. You have to be a starving and beaten kid to get anything those days (well, if you're a homeless from New Orleans, you'll get second hand clothes). But former prisoners also need money to re-enter society - classes, coaching, financial support, etc. Who do you think would give money to these guys? Nobody - and so they get lost in the cracks of philanthropy. That's why United Way talks very little about who they help - because they don't want to publicize the causes that are unpopular but that do need the money.

And there's the naivete of it. Who do you think receives the money given to philanthropy? Starving kids? Indirectly. It's food companies for providing food, truck companies for selling and renting trucks and so on so forth. This money buys goods and services at market prices. Sure, it's what's need and what should be bought. It just hasn't entered the public mind, who still see their dollar open the sky so that a ray of light touches the face of an orphan girl. Think about it next time you see a Corvette passing by: it may be the manager of a truck company.

A Belgian in Mumbai

How come Belgium is the third exporter to India and Switzerland, the fourth? Beats me. It's not the only surprising data to be found in this visual essay (pdf) on China and India from the Deutsche Bank Research. The top source of foreign direct investment inflow in India? Mauritius with 59% of actual flows.

By the way, if anyone has an idea of what the Indians are exporting from the Swiss alps and the flat country, email me. I know that the International Trade Centre from Geneva must have the info, but you need a password to get into their database.

I love raw data.

PS: Once again, thanks to the World Bank's Private Sector Development blog for the tip. I'll vary more my sources in the future, I promise...

The fortune teller

I've only started recently to read the Private Sector Development blog of the World Bank. It's quite corporate in the sense that you can't expect the spontaneity of a private blog, but it has nevertheless some interesting insights. Today, I found Who Says Money Can't Buy Happiness?, an opinion piece by Johan Norberg, a Swedish free-marketer - very much a brown bear lost in Lapland.

I don't tend to be too sympathetic to views that link money to happiness, but Norberg struck a chord. He said that the perspective of a better life makes one happy, hence that economic growth is key to happiness.

Here's my take: Happiness is an acceleration, just the way gravity is an acceleration. You feel good when there's a positive change in your situation. Remember how you felt when you bought that shirt/car/house or when you met that amazing girl? Now you curse your shirt because it needs ironing, your car is dirty again and the house's roof is leaking. And the girl is edgy today. Desperation. It's not that belongings and loved ones don't make you happy. It's just that they no longer bring a positive change to your situation. You got used to their presence: they're part of your normal life.

The difference between my theory and that of Norberg, is that he focuses on the perspective of change while I think happiness comes from the change itself. To him, expecting a party is true happiness. To me, the party (or at least the beginning of it) is happiness.

So, does money make you happy? Only when you get more of it. That's from a certain level of course - no money is rarely is ever a source of happiness. Norberg's logical deduction is that we should provide eternal economic growth to create a non-stop expectation of higher income. You'd think that I agree since constant economic growth provides an increase in income - a positive change.

I'm not ready to take that step. The quest for more money is time-consuming. It requires a long-term engagement, at the detriment of other activities that can make one happy. Actually, according to my theory, any (perceived) positive change brings happiness. There's a lot of effort to put in aspects of one life other than greater revenues that can bring happiness. Making new friends, arranging meetings with them, reading books, discovering new places, etc.

I don't mean to bash economic growth. I'm all for it. But when some say that too much emphasis is put on it, I tend to agree.

Le blog is dead, vive le blog

The raison d'être of this blog has changed. No longer a place for random experimentation, it will be a laboratory for an upcoming blog on political economy. I'm glad I have no reader to disappoint. Starting from here, I can only go up.

This decision stems from a strong sense of frustration with my career. There's no way I can achieve a sense of self-realization on my current path. Abraham Maslow would be ashamed of me. I seldom feel any pride related to my work. I don't use much my capacities.

In the midst of this situation, I received a shock today. I read the biography of Johan Norberg. This guy makes a living of his passion for political economy. It's like I needed to be told it's possible. I also received a message from a good friend of mine who decided out of the blue to visit Cuba on a bike next year (5 points to whoever else mentions Norberg and Cuba in the same paragraph). She wrote "I wasn't conscious of all the energy life has to offer". Let's tap in it, like I use to do.

I decided to start with a blog. I like this technology. It's at hand and let me express my opinions, research results instantly to a certain public (although there's echo on this blog for now). I'll experiment for some time, finding my voice andfavoritee topics. In a few weeks or months, when I'm up to speed and I've figured out the exact direction of this blog, I'll move it to a new location, where I won't be anonymous anymore.

Came the difficult decision of the language in which publish this blog. English is not my native language, but it appeals to more people. Many of my acquaintances are English-speaking. I decided that, even though I might sound less bright ina language that I don't master, it was worth a shot. Also, I jut feel more comfortable discussing this topic in English since I studied it in a British university.

Stay tuned.

iPod ruined my life

I feel that I've lost some of my interest in music recently. I blame my iPod.

When you hold 2000 songs in your hands, you can't help but wonder which you would enjoy the most right now. So you keep on searching an searching. And you don't actually listen to the song beyond 30 seconds because right away you start wondering what could be next.

The shuffle mode is worse. I keep on wondering what will come up next. I'm more interested in the sequence of songs. "Oh no, not this one. Thank God, nobody's listening" or "I can't believe it picked these two songs in a row out of 2000!"

Oh and I have my bight insight into the October 12th event scheduled by Apple. It will be a movie store. The market is not quite mature, but Apple has never waited for this. Prepare to buy your favourite movies online, all for $9.99.

You read it here first.