Comments on: Hillary & Obama … Meet The Kansas Tornado, Mr. Matt Fencl

By: Chris Carr

Chris Carr — Tue, 08 Apr 2008 04:41:48 +0000

Congrats to the Kansas Tornado, Mr. Fencl for KU kicking the behinds of Memphis tonight.

Rock ….. Chalk ….. JayHawk …… KU

Fall 2008

Nebraska — 45
KU — 10

And the football universe will again be aligned.

By: gary chou on his blackberry

gary chou on his blackberry — Tue, 01 Apr 2008 00:38:58 +0000

1. Matt, no one is completely unbiased.
2. Pete, why is per capita deficit a better measure of trade deficit than the gross deficit? Please explain.
3. I am a firm believer in trade is better (comparative advantage which is disputed by Pete). I argue the negative impact we see is inevitable short term work force adjustment. We must look at economics long term to have final verdict on trade merit. In short term, of course many people would lose jobs as the talents needed change and demand shift. But long term wise, it is better (bigger pie).
Also, let’s not forget the inevitable sin of richer get richer when pie increases. The most recent Economist gave the stat that financial service firms employ 5% of US work force (sans government) but generate 40% of corporate profit. This, my friend, is the result of having a bigger pie.
Free market economy capitalism is fair, just not in the most intuitive sense. Intuition could be misleading.
4. I like Obama and Hillary both very much, they sure will be fine presidents, regardless of what they say now days…for what they say have one purpose only, to win the votes that is still undecided on them. If every thing a person said is only targeted to a small population that like them, but not to those who already made up their minds, their words (Obama and Huillary) are indictive of nothing.
On the other hand, I don’t just like McCain, I revere this man. He will have my vote.

5. I am just nobody and never wrote a book,
Gary

By: Pete Murphy

Pete Murphy — Thu, 27 Mar 2008 12:12:37 +0000

Matt, our trade deficit with China gets all of the attention. However, when one examines our trade deficit in manufactured goods in per capita terms - that is, divided by the population of the country - our deficit with China is rather unremarkable. In 2006 our per capita trade deficit with 18 other countries was worse - including such nations as Japan, Germany, Mexico and Korea. Surprisingly, our biggest per capita trade deficit in manufactured goods was with Ireland. Our per capita trade deficit in manufactured goods with Ireland was 25 times higher than our deficit with China.

But China gets all of the attention, simply because of its sheer magnitude. I’m not saying that the deficit with China isn’t a problem. My point is that, since our trade policies were already a proven failure around the world, what did we expect when we applied the same policies to a country with one sixth of the world’s population?

The concept of free trade is based upon Ricardo’s principle of comparative advantage, dating back to 1815. Ricardo hypothesized that every nation benefits when they trade what they make best for products that other countries make best. On the surface, it seems logical. However, Ricardo’s theory is fatally flawed because it does not take into consideration the role of population density and what happens in trade between two nations of grossly disparate densities. While free trade in natural resources and free trade in manufactured goods between nations of roughly equal population density is indeed beneficial, just as Ricardo predicts, it is a sure-fire loser when attempting to trade freely in manufactured goods with nations that are much more densely populated, tantamount to economic suicide.

At this point, I should introduce myself. I am the author of a new book titled “Five Short Blasts: A New Economic Theory Exposes The Fatal Flaw in Globalization and Its Consequences for America.” To make a long story short, this new theory proposes that, as population density rises beyond some optimum level, per capita consumption begins to decline. This occurs because, as people are forced to crowd together and conserve space, a lack of space makes it ever more impractical to own many products. Falling per capita consumption, in the face of rising productivity (which always rises), inevitably yields rising unemployment and poverty.

This new theory has major ramifications for U.S. policy toward population management (especially immigration policy) and trade. The implications for population management are probably obvious, but why trade? It’s because these effects of an excessive population density - unemployment and poverty - are actually imported when we attempt to trade freely in manufactured goods with a nation much more densely populated than our own. Our economies combine. The work of manufacturing is spread evenly across the combined labor force. But, while the more densely populated nation gets free access to our healthy market, all we get in return is access to a market emaciated by over-crowding and low per capita consumption. The result is an automatic, irreversible trade deficit and loss of jobs. A virtual host-parasite relationship is established.

If you’re interested in learning more about this new theory, please visit my web site at OpenWindowPublishingCo.com where you can read the preface for free, join in my blog discussion and, of course, purchase the book if you’re interested. (It’s also available at Amazon.com.)

Please forgive the somewhat “spammish” nature of this reply, but I don’t know how else to inject this new perspective into the debate about trade and population without drawing attention to the book.

Pete Murphy
Author, Five Short Blasts

By: Chris Carr

Chris Carr — Thu, 27 Mar 2008 03:33:07 +0000

Good post.

Hillary is talking smack. This is a good example of a candidate pandering to to their base to win the primaries and become the party nominee, and then when the general election comes (and assuming she edges out Obama for the party nomination) we will see her on a dead sprint back to the political middle ground in order to appear moderate and hence garner the most votes across the US.

Obama has also rattled similar sabres in the past. See, e.g., my previous post on his China reflexes and earlier campaign comments — Mission Control to Obama.

And McCain? Same thing. To get win the primaries, he too, heavily pandered to the party base, and now we are seeing him seek safer, more moderate political ground.

Folks, there are no saints in the rough and tumble business of politics, Dem or Repub. After the election is over, my amateur arm-chair prediction is that regardless of who wins, re: the China issue it will be back to business and the status quo as usual in Washington. The posturing we are now seeing on both sides of the political isle is all a part of the dance.