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That's exactly the same argument that can be used for outsourcing IT jobs. You can't have it both ways people! You can't have your cheap consumer economy in the US, and still want your jobs protected. Why not complain about the poor music industry jobs that are being "outsourced" to Russia?

At some point you might want to read something about the concept of Comparative Advantage, which goes back to Adam Smith I believe. You should be able to find some information about this in the context of the current outsourcing debate at The Economist.

These cold fusion stories always tickle my imagination with visions of electricity too cheap to meter, a ctrl-alt-del on the world's economy, and awesome new industries that today are not feasible because of the expense of power. But its all fairy tales. This Economist article sums up how fusion is improbable, and throwing good money after it makes no sense until there is a real break through. It also gives overviews of some of the other big efforts to make fusion a commercial reality.

This space for rent.

I sent an email to the editor, and I got a response from the author, Andreas Kluth.

In the resulting dialog Andreas admitted:

...I do plead guilty that I have not actually used or tried to install Linux on a desktop myself--along with 99.9% of our readers, I would guess.

So much for journalistic integrity. At least he was honest though! You can reach Andreas at:
andreaskluth@sbcglobal.net or
andreaskluth@economist.com

One of the major things that deters a lot of people from using Linux is the difficulty of installing an application. One Windows it's just a matter of downloading one file and double clicking it.

Depends on the people. Some people are looking for exactly that.

This can boost the price of the stock and is sometimes called a short bounce.

This effect is also known as a "dead cat bounce". This is my favorite phrase I've learned from The Economist. :-)

This is from their contact page:

Contacting us

Letters to the editor

Send an e-mail to letters@economist.com to comment on any article you have read in The Economist. Unless you state otherwise, e-mail to this address will be considered for publication in The Economist. Don't forget to include your postal address and a daytime telephone number. Please do not use this address for general correspondence.

Alternatively, you can fax your comments to:

+44 20 7839 2968/9

or post them to:

Letters
The Economist
25 St James's Street
London, SW1A 1HG
United Kingdom

Please note, due to the volume of mail we receive, we cannot reply personally to all messages. Published letters will be edited for length and style.

It looks more like a ju-jitsu demostration.

Heck I used to do Jiu Jitsu and I'd be really scared if that demented bald thing assaulted/embraced me like that.

It looks more like a ju-jitsu demostration.

I guess this depends on how you define "data". The Economist recently described a Berkeley report that 3.5 to 5.5 *Exabytes* of data were produced in 2002. If you believe the unlikely proposition that Blue Glue is holding 70% of that new data, then you have to wonder why IBM only made $4.2B in selling mainframes to store and process that data.

Many of the problems with capitalism seem to be realted to individuals lacking information...

After all, you speak of the different economic systems but they are really just different points along the spectrum of government control. (...) So, are you planning to just pick different points on the scale until you find a "sweet spot"? Or are you hoping for new scale to appear?

Many of the problems with capitalism seem to be realted to individuals lacking information...

After all, you speak of the different economic systems but they are really just different points along the spectrum of government control. (...) So, are you planning to just pick different points on the scale until you find a "sweet spot"? Or are you hoping for new scale to appear?

Ecstasy can be quite benign if done in moderation and with a good head on your shoulders.

In one good article on this topic, The Economist pointed out that you were more likely to die from a single airline flight than a single dose of MDMA.

The classical Slashdot debate features something-stupid-done-or-said-by-non-IT-savvy-gene ral-managers, and then the appropriate bashing by IT-savvy Slashdotters. If there were a similar forum where my profession were in majority, they would probably be bashing this very thread right now (I am an economist and business manager).

Just like, say, PERL or Java, spreadsheets can be used well, and they can be used poorly. Furthermore, people with good "technical" Excel skills can produce lousy spreadsheets with little analytical value, and vice versa. I have seen some fantastic spreadsheets which have totally revolutionized the way people saw a problem. At an insurance company I worked with, they used a huge spreadsheet to do a simulation of the effects on every single customer of a planned, dramatic price increase. The result: They realized that the price increase would have much less impact than they feared. Thus, the product was kept and the employees kept their jobs. The thing with the spreadsheet was that it was developed in fast trial-and-error loops, which meant that their run-once-per-night SAS tools were not an option (this was 7 years ago).

(I have, by the way, also seen people spend 3 months on developing a mega-spreadsheet for assessing the value of a company, only to use the wrong assumption for a critical value and thereby introducing an error of about 40% in the valuation [that critical value being the discount rate]).

I can assure all the concerned citizens of this forum that there is indeed a lot of excellent, first-rate Excel usage out there. Analytical power beyond our wildest dreams is at the fingertips of people without skills in programming at any lower level. This, believe it or not, is a good thing, because anyone who has dedicated himself to becoming great at programming is probably less skilled in disciplines such as financial analysis.

Sure, there is "bad code". Sure, people get a false sense of control. Sure, this new tool puts too much options in the hands of people who do not know how to use them. But how would that be untrue of other IT tools or programming environments? What does it matter that they use Excel as a database, as long as it gets their work done easier than getting an SQL education and then doing it "right"?

Biases are part of all decision-making (as even economists are realizing). So what if that is the case in Spreadsheet World, too?

Here it is, but I think paid subscription to the Economist is required.

So like someone up there said... "looks good on a chalkboard, but doesn't pan out in reality."

Anyway, to bring this back on topic, last week's Economist (don't be put off by the title, grasshopper) had a great survey of Chinese politics, culture and business. A fun read and enlightening, too.

Well on the plus side they found this out before they started making a ton of products that use it.

Oh, don't worry, right wing economists, right wing governments and bough-and-paid-for "scientists" will smugly declare that this is the usual bleating from the Church of Environmentalism, that More Study Is Needed, and that any attempt to ban it or learn more about possible ill effects is an affront to Free Trade and a crime against mankind.

According to opensecrets.org Microsoft greases both parties (which is no surprise most corporations do) although, they gave a significant amount more to republicans. Also not the least bit surprising considering "[the Microsoft break-up] judgment was reversed in 2001 after the Clinton administration, which had adopted an aggressive antitrust stance, was replaced by a more business-friendly Bush administration" (Can Microsoft be tamed?).

I think you're confused. By 'Liberal' I mean the school of economic thought created by Adam Smith, Thomas Malthus and others, which was prevalent from its creation in the latter part of the eighteenth century all the way up until 1929. The kind of economic thought that The Economist advocates.

You use 'liberal' to oppose conservative; and that is the common meaning of the word in the United States today, but it doesn't mean that when you see a Liberal Party in, say, Europe that they're not conservative; they're about as conservative as they come. Elsewhere, what you call 'liberal' others call 'reformist' or 'center-left'.

No, the US is not like other countries.

As an outsider it's rather touching to see claims like this being made. What might simply be seen as devil-may-care arrogance is arguably not that at all - it looks more like a genuine delusion concerning the extent to which US values are shared by others.

Here

and incidentally, it's one of the excuses the one who's been greased by the Lord uses to keep his stronghold over analog TV, against EU rulings, running.

The results of the surveys have been quite interesting actually. Mainly they seem to say that most people do think they're better off now than under Saddam, but oppose the continued presence of the coalition forces. The Economist has a graphic with some of the figures.

Remember the quote from the patent office in 1899, something along the lines of 'Everything that can be invented has been invented'?

It is an historical myth that the commissioner of America's Patent Office recommended it be abolished in 1899. Rather, he asked for a funding increase because of the heavy load of applications, arguing that anyone who would deny him additional funding must believe that "everything that can be invented has been invented."

It's interesting, too, to see how little times have changed since then--the patent office saying that it was overloaded and needed more resources.

Mainly, improving technology (e.g. irrigation, GM foods) that allows us to do more with less. But I need to amend my former statement. Even if positive growth is unsustainable, that doesn't preclude capitalism. For example, real estate on the island of Manhattan is severely limited, but land ownership is still governed according to centuries-old notions of property rights--protection of capital, in other words. Capitalism.

I don't know, it just seems to me you're not thinking things through economically or scientifically (hell, philosophically either). Capitalism is not going to implode upon itself. Mankind is not doomed.

(Before you ask, no--I'm not a libertarian by any stretch of the imagination. But I do read the Economist.)

David Pimentel, an expert on food and energy at Cornell University, has estimated that if all of the world ate the way the United States eats, humanity would exhaust all known global fossil-fuel reserves in just over seven years ... [US Farming] is an annual artificial catastrophe, and it requires the equivalent of three or four tons of TNT per acre for a modem American farm. Iowa's fields require the energy of 4,000 Nagasaki bombs every year.

Less than 10% of the carbon content of plants is converted to coal, while the formation of oil and gas from plankton is less than 0.01% efficient ... the fossil fuels burned in 1997 were ultimately derived from 400 years' worth of "primary production", as the organic material produced by photosynthesis is known.

The fossil fuels burned in 1997 were created from organic matter containing 44 x 1018 g C, which is >400 times the net primary productivity (NPP) of the planet's current biota. As stores of ancient solar energy decline, humans are likely to use an increasing share of modern solar resources. I conservatively estimate that replacing the energy humans derive from fossil fuels with energy from modern biomass would require 22% of terrestrial NPP, increasing the human appropriation of this resource by ~50%.

Actually for "middle america" the deal is just fine. The law of comparative advantage still holds true, some 200 years later, regardless of the product or service being produced. True, it sucks for many of us in IT who now need to find other work but this isn't going to kill the American economy or destroy the middle class. We don't require protection, we need to get on with our lives and find something else to do to earn a living. The Economist from 2/21 makes this point much clearer.

While I'm not arguing that outsourcing is harmless, it would be useful if people educated themselves adequately on the subject. The Economist in particular has had many quality articles on the subject (like this one). Here's a particular quote of interest...

"Government statisticians reckon that outsourced jobs are responsible for well under 1% of those signed up as unemployed. And the jobs lost to outsourcing pale in comparison with the number of jobs lost and created each month at home. Even here, the rate of job "churn" has, for unclear reasons, been falling since mid-2001."

Food for thought at least...

<a href="http://www.economist.com/science/tq/displayS tory.cfm?Story_id=779421">Bill Price's version</a> actually sounds ...

The latest issue of the Economist (registration required for some articles, but not this one) has a news item on the SCO lawsuits that calls SCO "a pariah firm in the software industry". I found this interesting, as past coverage by the Economist had been relatively sympathetic to them.

The latest issue of the Economist (registration required for some articles, but not this one) has a news item on the SCO lawsuits that calls SCO "a pariah firm in the software industry". I found this interesting, as past coverage by the Economist had been relatively sympathetic to them.

I'm no fan of the Bush Administration, but they are right here. Outsourcing hurts the folks that get outsourced, but the rest of us win. The people that can do the job the cheapest get the job, the basic goods and services we use get cheaper, our standard of living goes up, etc. etc. Again, the person who loses a job is hurt, but it's often temporary. Because we all benefit from the individuals loss, we should support temporary benefits while that person changes careers.

From the Economist, Feb 19th 2004 (the India issue):

EARLIER this month, President George Bush's chief economic adviser, Gregory Mankiw, once Harvard's youngest tenured professor, attracted a storm of abuse. He told Congress that if a thing or a service could be produced more cheaply abroad, then Americans were better off importing it than producing it at home. As an example, Mr Mankiw uses the case of radiologists in India analysing the X-rays, sent via the internet, of American patients.

Mr Mankiw's proposition, in essence, is the law of comparative advantage, first postulated by David Ricardo two centuries ago and demonstrated to astonishing effect since. Yet the Republican speaker of the House of Representatives, Dennis Hastert, joined Democrats in their rebuke of Mr Mankiw for approving of jobs going overseas; another Republican called for his resignation. The White House gave Mr Mankiw only lukewarm support -- unsurprisingly, since Mr Bush recently signed a bill forbidding the outsourcing of federal contracts overseas. And the Democratic presidential contenders? Mr Mankiw had just written their attack ads.

...

She uses the example of cheaper IT hardware, one of the main aspects of globalisation in the 1990s. Most of the drop in prices for PCs, mainframes and so on was caused by the relentless advance of technology; but she still thinks that trade and globalised production -- all those Dell Computer factories in China, for instance -- was responsible for 10-30% of the fall in hardware prices. These lower prices led to higher American productivity growth and added $230 billion of extra GDP between 1995 and 2002, equivalent to an extra 0.3 percentage points of growth a year.

These days, software spending is increasing at twice the rate of hardware spending, as businesses struggle to make their new computers work better. The manufacturing sector is where such integration has gone furthest. In many other parts of the American economy, the process has barely begun -- particularly among smaller- and medium-sized businesses. Mr Mankiw's example of the Indian radiologist shows how the internet could help lower costs and raise productivity in health care. Who would object to that?

I'd add more, but the Economist doesn't have a free online site. If you don't mind paying $2.95, you can read the whole article. Or, you can find someone who doesn't mind putting the whole article on the web.

A great book for learning basic economics is Naked Economics: Undressing the Dismal Science by Charles Wheelan. And, of course, a subscription to the Economist can't hurt.

It's painful to see outsourcing move from the manufacturing sector to the service sector, but we're better off because of it. Keep your skills up-to-date folks, and think about those management jobs.

Well said. "The Economist" made a similiar argument in response to the book (The case for brands Sep 6th 2001 From The Economist print edition - subscription required). Exerpt:

Far from being instruments of oppression, they make firms accountable to consumers.
IMAGINE a world without brands. It existed once, and still exists, more or less, in the world's poorest places. No raucous advertising, no ugly billboards, no McDonald's. Yet, given a chance and a bit of money, people flee this Eden. They seek out Budweiser instead of their local tipple, ditch nameless shirts for Gap, prefer Marlboros to home-grown smokes.

For similar arguements, check out a recent op-ed by economist Paul Krugman and a recent article on outsourcing in the Economist.

Yes, I referenced an article from the Economist. I realize that makes me a f#$%'n prick.

M$ has {sic} the money to do it too.

Likewise, users, especially governments and NGOs may walk en masse to other solutions to avoid Palladium encumbered file formats, BIOS, CPUs, OS, and apps.

Sheesh. I was just thanking our lucky stars that open source software has the wherewithall to wander around neutered organizations like the UN and the US Gov. "Open Source's Local Heroes" | The Economist "Se Abla Open Source?" | c|net

The Economist has an article which outlines what the previous post describes and describes how Mr Eisner is now probably the problem.

According to economist article the Comcast offer was viewed as clearly low-ball. They would need to raise it by $8 per share to be on par with Disney perceived share value. What Disney may be doing is engaging in shrewd negotiations- the proper thing to do! I quote the salient paragraph from Economist article:

"Mr Eisner, one of the entertainment world's great survivors, will no doubt try to fight to the death. He may offer yet more corporate governance reforms--though the easy ones are mostly done. He will point out that Comcast's opening offer, originally worth $27 a share and falling, is too low--though Comcast has surely known all along that it will have to raise its offer closer to the $35 that Lawrence Haverty of State Street Research says would tempt institutional investors. The fact is, if Disney's board really wants to keep one of the world's iconic companies independent, its best strategy may be to replace Mr Eisner forthwith. Otherwise, Comcast will soon be doing it instead."

The Economist isn't just - or even mostly - about economics. It's about 60% global politics and current affairs, 25% business and finance, 15% science, technology and culture. In fact I skip over most of the "economics" articles, because they bore me, and yet I still get withdrawal symptoms if I get the current issue a day late!

You mean this Paul Krugman? The economist/journalist that is rated as 2nd-most partisan author in the States?

Might be required reading... but it would hardly give you a very objective view of things.

The Economist:

"As the site documents exhaustively, the vast majority of Mr Krugman's columns feature attacks on Republicans; almost none criticise Democrats. Unsurprisingly, this has made him a sort of ivory-tower folk-hero of the American left--a thinking person's Michael Moore. "

As of this moment I have 49 replies to my post most of whom have in fact used the feedback form on the bbc website to express their opinion. I didn't intend to actually cause a slashdotting of their feedback form. Still, similar action (writing letters to the editor) has caused better journalism on this subject at the economist and other publications. Sending in your opinion is the only way to get to a better standard of journalism, and most journalists are encouraged by positive feedback. In this case I think most of us agreed (in our expert opinion as geeks) that the author was so way off base in his accusations that the article is unsalvageable.

You are, in fact, quite right. The Economist had an article entitled "Psst. Wanna real Rolex?" on Jan. 22, 2004. Unfortunately, it's only in the print version unless you subscribe or pay to view it online.

The gist of it was that Swiss watch makers actually exported $150m worth of watches. The people actually do want to get the real thing.

I think the reason that doesn't usually happen is a result of a couple of things. First, China's people are still very poor, even with the burgeoning middle class there, so they just can't afford it. Second, I wonder if it's also because they don't have the same consumer culture as we do. We are bombarded with advertisements and other social clues to make it socially unacceptable to have a knock-off. This last one may not be true, as I've not been to China, nor am I any great scholar on it.

TSage

Here is the article I mentioned in my parent post, along with the matching Slashdot article.

In general, I do not have a problem with outsourcing of jobs to cheaper locales, but there are some pieces of information and bad stereotypes being thrown about here in general that need to commented on.

• Bad US Education - Read this Economist Article on education. Big study shows that of top 50 Universities, all but 15 are US. Also talks about how broad US education system is for all levels.
• Stop assuming that what you see on TV is mainstream US culture. Do you assume that India is going to hell based on what you see in Bollywood movies. The US is an amazingly diverse country beyond the boob tube.
• It's one thing to offshore jobs, but I haven't seen too many countries with a system that encourages innovation like the US. With the exception of Europe and Japan (who are still pretty far behind) I have yet to see many truly new ideas and companies spring up. Most are just filling in the details or internationalizing what's already been done. Though frankly, I look forward to the rest of the world starting to contribute a little more.

Hey, think like real Americans, don't just try and distribute a fixed pie amongst everyone, make the pie a whole lot bigger through innovation and scientific discovery. I've yet to see a system that fosters new ideas like that of the United States.

This article attests to the (lack of) quality of publications like Forbes, Money, Fortune, etc. Sensationalist articles that are both poorly written and researched.

For more good writing that is often amazingly entertaining articles I suggest The Economist.

I agree with the rest, but farm subsidies do NOT keep prices down: Economist.com

Cute, but Darl McBride is a Mormon, not a Catholic.

The well respected economist magazine has a ppp index related to Big Macs

Of course they make you pay to see it..

As always, when dealing with exchange rates these equivalencies are relatively meaningless. What really matters is whether UK residents (for instance) are willing to pay twice as much per download. I remember travelling through the UK and being totally shocked that chocolate bars are around $2.25 CDN apiece, but they still seemed to sell.

In economic terms, if the market price of a good is higher in a given currency compared to the US dollar, that currency is overvalued with respect to the US dollar. In the opposite case (a la Canadian dollar) it is an indication of an undervalued currency.

Theoretically, I suppose Americans could simply buy all their mp3s from Canadian stores and save big, but I imagine there's some sort of rule in place that prevents them from doing so. And if there isn't, I'm sure it won't be long before there is.

An interesting corollary, for those who are interested in the economics of foreign exchange, is The Economist's Startbuck Tall Latte Index. Definitely worth a click.

CNN has an article about Bush's sudden fascination with the space program and it points out how he never once visited the NASA facilities in Houston while he was governor there. Also the convenient timing of his announcement that just happens to coincide with the Democrat front-runners ganging up on Howard Dean is mentioned.

One of the first casualties of the cuts that are necessary to make Bush's 'vision' a reality has been the Hubble, as reported in New Scientist.

See also some concise reporting from the Economist that takes a cold, unemotional look at the question of whether or not we actually need manned spaceflight at all. From that article:

[H]is grand announcement this week may not, in the end, amount to anything more than starry-eyed campaign rhetoric. Of course, only an incorrigible cynic could possibly conclude that Mr Bush knows this perfectly well--and intends simply to let the whole thing fade away after it has helped him get re-elected.

I digress.

That paper has long held an anti-manned-spaceflight view, which I would say is a bit short-sighted in view of the vulnerability of Earth to catastrophic bombardments from above.

This is just my opinion so take it for what it's worth. I DO think that most business decisions are like insurance. I think this is pretty much true for management--especially for project managers. I have seen my bosses and their bosses make decisions that don't make much technical sense but are good business decisions (to alleviate risk & blame). Ultimately it makes sense from an external point of view. It is logical for management to do everything in their power to keep their job. In fact, finance theory has this notion of agency cost which is used to explain why CEOs get paid millions in stock options (according to this theory, it is to align their interests with that of the company. Otherwise, the executives will simply act in their own interests).

When I was in the field (only for a few years--I was in school at that time), I didn't really run into the problem you are talking about (some dude referencing you when in fact you were just giving some opinion). But I did hear about it. I guess it is more of an issue for senior people. I can imagine someone pinning the blame on some architecture or design issue on the person who "suggested" it, instead of they themselves (who made the decision to go with the "suggestion") take responsibility.

"It's really fascinating to observe, if you aren't emotionally invested in the incident."



heh :) When I did have a job, I was only a low level employee (entry level software developer,etc) so I know what you mean. Never faced anything big but I have seen stuff happen...

Sivaram Velauthapillai