The term “Great Game” usually refers to the 19th century contest for influence in Central Asia between Russia and the British Empire. A recent article, “New ‘Great Game’ for Central Asia Riches,” provides a good overview of the current contest for influence in Central Asia by outside powers.
As the article makes clear, after September 11, 2001, the U.S. became heavily invested in the region, though has now been relegated to a more marginal player. This is partly due to waning interest on the part of the U.S. government, and partly because of the heavy initiative and investment in the region shown by China and Russia, now the two main outside influences in the region.
China in particular has substantially increased its investment in the region, with this also helping fuel the economic development of western China, with the China-Kazakhstan border coming to resemble the U.S.-Mexico border as one of the few international borders where one much more developed country shares a long border with another much poorer and less developed country, and with investment from the richer country fueling asymmetrical but cross-border development.
Showing posts with label Asia. Show all posts
Showing posts with label Asia. Show all posts
Monday, December 17, 2007
Sunday, December 16, 2007
Food and Biofuels
The world is currently experiencing tremendous inflation in food prices. As a report in a recent issue of The Economist (December 8, pp. 81 – 83) argues, there are two major causes of this global food inflation (not to deny the potential for other factors as well – and see my note below on the contribution of oil prices to food inflation).
One of these contributing factors is actually a side effect of a positive development. The level of affluence has risen dramatically in China and India and some other developing nations in recent years. As in already developed countries, affluence has some negative consequences, e.g. greater environmental impact from higher per capita energy consumption. Higher affluence has also led to a boom in meat eating in China and India – The Economist reports that meat-eating in China went from 20 kg of meat per capita per year in 1985 to more than 50 kg per capita per year now. More meat equals more grain grown for feed equals (unless tremendous, even stupendous, quantities of land were put into grain production – causing a whole new set of ecological problems) higher prices for grain.
The second major cause of current global food inflation is the diversion of enormous amounts of grain, especially maize, to subsidized biofuel production in places like the U.S. This has resulted in an increase in maize prices, which alone contributes to food inflation, but with the further result that many farmers have switched from cultivating other grains to maize, much for biofuel purposes, further contributing to food inflation.
An article, “Biofuels: Danger or New Opportunity for Africa?,” makes clear that the problem (to the extent that food inflation is a problem – The Economist report argues that with increased food prices, some farmers, including some in the developing world, will benefit, depending on how food inflation is managed by governments) is not the use of biofuels per se.
The “Biofuels” news article reports on a conference on biofuel and food held in Ouagadougou, Burkina Faso, where a number of perspectives on biofuels were presented. Many voices call for cautious development of biofuel production in Burkina Faso and other African nations.
Within this framework of caution, some individuals expressed hope for biofuel development in Africa for a variety of reasons. (1) In non-oil-producing countries, like Burkina Faso, biofuels could potentially provide a lower price source of fuel than oil imports, given the current astronomical price of oil. (It seems clear to me, and I was surprised that the report in The Economist didn’t deal with this, that global oil prices are a major contributor to food inflation in two ways: [a] increased transportation cost due to higher oil prices adds to the cost of all commodities; [b] the high price of oil is the main spur for biofuel development.) (2) Biofuel and food aren’t mutually exclusive. For example, biofuel byproducts can still be used for feed for livestock or for fertilizer. Further, biofuel need not be produced strictly from edible grains. Brazil’s sugar cane (edible, but not a grain) provides a far more efficient source for biofuel production than North America’s maize, and for countries like Burkina Faso, biofuel might be best produced from non-edible plants grown on land less well suited for direct food production purposes. (3) Biofuels don’t have to fuel everything in order to be useful – they can be used strategically. For example, in poor countries, diverting small proportions of crops to biofuel production specifically to fuel tractors and other agricultural equipment could be a way to simultaneously increase the scale of production and have agricultural production fuel itself.
Again, the problem isn’t biofuels per se, but the diversion of large portions of the world’s food supply (especially North American maize) into fuel production in a context of trade and other policies that stymies more efficient and sensible biofuel production.
One of these contributing factors is actually a side effect of a positive development. The level of affluence has risen dramatically in China and India and some other developing nations in recent years. As in already developed countries, affluence has some negative consequences, e.g. greater environmental impact from higher per capita energy consumption. Higher affluence has also led to a boom in meat eating in China and India – The Economist reports that meat-eating in China went from 20 kg of meat per capita per year in 1985 to more than 50 kg per capita per year now. More meat equals more grain grown for feed equals (unless tremendous, even stupendous, quantities of land were put into grain production – causing a whole new set of ecological problems) higher prices for grain.
The second major cause of current global food inflation is the diversion of enormous amounts of grain, especially maize, to subsidized biofuel production in places like the U.S. This has resulted in an increase in maize prices, which alone contributes to food inflation, but with the further result that many farmers have switched from cultivating other grains to maize, much for biofuel purposes, further contributing to food inflation.
An article, “Biofuels: Danger or New Opportunity for Africa?,” makes clear that the problem (to the extent that food inflation is a problem – The Economist report argues that with increased food prices, some farmers, including some in the developing world, will benefit, depending on how food inflation is managed by governments) is not the use of biofuels per se.
The “Biofuels” news article reports on a conference on biofuel and food held in Ouagadougou, Burkina Faso, where a number of perspectives on biofuels were presented. Many voices call for cautious development of biofuel production in Burkina Faso and other African nations.
Within this framework of caution, some individuals expressed hope for biofuel development in Africa for a variety of reasons. (1) In non-oil-producing countries, like Burkina Faso, biofuels could potentially provide a lower price source of fuel than oil imports, given the current astronomical price of oil. (It seems clear to me, and I was surprised that the report in The Economist didn’t deal with this, that global oil prices are a major contributor to food inflation in two ways: [a] increased transportation cost due to higher oil prices adds to the cost of all commodities; [b] the high price of oil is the main spur for biofuel development.) (2) Biofuel and food aren’t mutually exclusive. For example, biofuel byproducts can still be used for feed for livestock or for fertilizer. Further, biofuel need not be produced strictly from edible grains. Brazil’s sugar cane (edible, but not a grain) provides a far more efficient source for biofuel production than North America’s maize, and for countries like Burkina Faso, biofuel might be best produced from non-edible plants grown on land less well suited for direct food production purposes. (3) Biofuels don’t have to fuel everything in order to be useful – they can be used strategically. For example, in poor countries, diverting small proportions of crops to biofuel production specifically to fuel tractors and other agricultural equipment could be a way to simultaneously increase the scale of production and have agricultural production fuel itself.
Again, the problem isn’t biofuels per se, but the diversion of large portions of the world’s food supply (especially North American maize) into fuel production in a context of trade and other policies that stymies more efficient and sensible biofuel production.
Tuesday, May 22, 2007
Global Trade and Free Action
In an earlier post, “Maintaining and Enhancing Free Action,” I argued that increasing individual freedom in general in any significant way required production of greater wealth. I further argued that this was a necessary but not sufficient condition for enhanced quality of life and real freedom for any significant number of people in global terms.
Much of Sub-Saharan Africa provides a case in point. Most of the African continent has been quite marginal to global trade, and its population, cut off from trade and much economic development, has suffered for it. (I’d argue that most of Africa has been thoroughly enough incorporated into global trade to be dependent on it, while simultaneously not integrated enough or in a way to benefit much from it.) One of the lead articles in the April 28 issue of The Economist, “Will Africa ever get it right?” (pp. 14 – 15), puts it bluntly:
“The post-colonial continent has hitherto been a colossal flop. The killer comparison is with Asia, where many countries suffered from the same colonial humiliations and rapacity that independent Africa customarily blamed for its early failings. According to the World Bank, real income per head in the 48 countries of sub-Saharan Africa between 1960 and 2005 rose on average by 25%, while it leapt 34 times faster in East Asia; countries like South Korea and Malaysia were once as poor as Ghana and Kenya.”
I’d question whether many places in Asia suffered the same degree of “colonial humiliations and rapacity” as much of Sub-Saharan Africa, and I’d point out that trade and production of wealth in Africa was seriously set back by the continent’s role as major site for numerous Cold War proxy wars. (Parts of Asia experienced that, too, most obviously Korea and Vietnam – though in both of those cases, armed struggle ended long ago, whereas much of Africa has been beset by lingering, continuous, low-intensity armed conflict.) Still, this is to debate the cause of Africa’s economic marginality, and not its effect, which is clear: endemic grinding poverty.
Still, recently things are looking up for much of the continent. The same Economist article points out that the economies of many Sub-Saharan nations (and not just oil-exporting nations) are growing at annual rates of 6 – 7 % for the past several years. This has been accomplished via changes that have been conducive to trade and investment, such as more openness to private enterprise, moves toward democratization, freer markets, etc. There are many obstacles in the way of sustained development (continued political tension and violence in some countries, the recent election scandal in Nigeria, malaria and AIDS, recent indications that Global Warming may affect Africa especially severely, etc.), and I’m under no illusion that the wealth produced through increased trade will be distributed in equitable ways, but even small increases in the wealth of average persons could significantly alleviate the worst miseries of poverty in the continent.
In a recent article in The Washington Post, “Free Trade’s Great, But Offshoring Rattles Me,” economist Alan S. Blinder makes the case for how globalization, free trade, et al., will improve conditions for people around the world, but with the big caveat that it will not make things better for everyone. Blinder argues that two things are driving globalization, and associated phenomena such as offshoring or outsourcing. The first is technological innovation, especially in information and communication technology, the second being the more systematic entry of huge numbers of workers into the world economy in countries such as China, India, and Eastern Europe, workers willing and able to perform information based or manufacturing jobs more cheaply that workers in more developed nations.
Blinder writes:
“Looking at these two historic forces from the perspective of the world as a whole, one can only get a warm feeling. Improvements in technology will raise living standards, just as they have since the dawn of the Industrial Revolution. And the availability of millions of new electronically deliverable service jobs in, say, India and China will help alleviate poverty on a mass scale. Offshoring will also reduce costs and boost productivity in the United States. So repeat after me: Globalization is good for the world. Which is where economists usually stop.”
Blinder doesn’t stop there. He also points out that globalization will have ill effects on some. Globalization and freer trade may be related to greater total production of wealth, but it also changes the distribution of wealth. In some ways this is good, as with the degree of poverty alleviation that increased numbers of jobs brings to places like India or China. For workers in the U.S. or Western Europe whose jobs are offshored, their share of wealth clearly drops, and as Blinder writes, this will potentially affect large numbers of people. “In some recent research, I estimated that 30 million to 40 million U.S. jobs are potentially offshorable. These include scientists, mathematicians, and editors on the high end and telephone operators, clerks and typists on the low end.”
Blinder argues that some reforms could be implemented to ease the transition, such as better economic safety nets for displaced workers, and changes to education to emphasize training for flexibility and for the sorts of jobs least likely to be offshored, but he is ultimately gloomy about the prospects of such reforms being implemented and warns of a rough transition for many Americans.
Globalization is not a panacea for people in China or India or Sub-Saharan Africa either. The jobs being offshored to such countries are generally low-wage (or else they wouldn’t be offshored there), and sometimes associated with dangerous working conditions. In an earlier post, “A Different Globalization for Labor,” I wrote:
“Another common assumption is that such globalization processes are also bad for labor in the developing nation contexts that manufacturing and service jobs are being outsourced to, e.g. promoting sweat shop labor conditions. Robert J. Flanagan has recently published an important book on this topic, Globalization and Labor Conditions (Oxford University Press, 2006). Flanagan closely examines the available data on labor conditions around the world. He is clearly sympathetic to critiques of globalization, but comes to the conclusion that overall, globalization has led to improved conditions for labor in much of the world. He in no way implies that globalization processes make things wonderful for workers in developing countries. As he documents, there are things like sweatshop labor associated with globalization, but there are more overall jobs and fewer jobs with the worst labor conditions in more open developing economies – hardly what I’d consider a ringing endorsement, but still having more crappy jobs available might be better than having fewer or no crappy jobs available, even while still not good.”
What do I conclude from all this? Globalization and more trade (and the greater production of wealth associated with it) has its problems – and major problems at that for workers in all countries. At the same time, globalization is here to stay, and to the extent that production of greater wealth is a precondition for increasing individual human freedom in general, there are positive developments associated with globalization as well. As Blinder points out, economists and other free trade apostles often emphasize what is positive or what they see as positive about globalization and ignore the rest. Leftists of a variety of stripes just as often emphasize what is negative or what they see as negative and ignore the rest. The goal, as I see it, should be an emphasis on more equitable distribution of wealth (which would entail things like better social safety networks, better job training and re-training programs, better regulation of work conditions globally, emphasis on freedom of speech and assembly so that workers could better organize and act collectively, emphasis on often neglected aspects of “free” trade – freer movement of labor and reduced agricultural subsidization in rich countries, etc.) within a system of global trade and development which is sustainable (which would require positive work on global warming and major diseases, such as malaria and AIDS).
Much of Sub-Saharan Africa provides a case in point. Most of the African continent has been quite marginal to global trade, and its population, cut off from trade and much economic development, has suffered for it. (I’d argue that most of Africa has been thoroughly enough incorporated into global trade to be dependent on it, while simultaneously not integrated enough or in a way to benefit much from it.) One of the lead articles in the April 28 issue of The Economist, “Will Africa ever get it right?” (pp. 14 – 15), puts it bluntly:
“The post-colonial continent has hitherto been a colossal flop. The killer comparison is with Asia, where many countries suffered from the same colonial humiliations and rapacity that independent Africa customarily blamed for its early failings. According to the World Bank, real income per head in the 48 countries of sub-Saharan Africa between 1960 and 2005 rose on average by 25%, while it leapt 34 times faster in East Asia; countries like South Korea and Malaysia were once as poor as Ghana and Kenya.”
I’d question whether many places in Asia suffered the same degree of “colonial humiliations and rapacity” as much of Sub-Saharan Africa, and I’d point out that trade and production of wealth in Africa was seriously set back by the continent’s role as major site for numerous Cold War proxy wars. (Parts of Asia experienced that, too, most obviously Korea and Vietnam – though in both of those cases, armed struggle ended long ago, whereas much of Africa has been beset by lingering, continuous, low-intensity armed conflict.) Still, this is to debate the cause of Africa’s economic marginality, and not its effect, which is clear: endemic grinding poverty.
Still, recently things are looking up for much of the continent. The same Economist article points out that the economies of many Sub-Saharan nations (and not just oil-exporting nations) are growing at annual rates of 6 – 7 % for the past several years. This has been accomplished via changes that have been conducive to trade and investment, such as more openness to private enterprise, moves toward democratization, freer markets, etc. There are many obstacles in the way of sustained development (continued political tension and violence in some countries, the recent election scandal in Nigeria, malaria and AIDS, recent indications that Global Warming may affect Africa especially severely, etc.), and I’m under no illusion that the wealth produced through increased trade will be distributed in equitable ways, but even small increases in the wealth of average persons could significantly alleviate the worst miseries of poverty in the continent.
In a recent article in The Washington Post, “Free Trade’s Great, But Offshoring Rattles Me,” economist Alan S. Blinder makes the case for how globalization, free trade, et al., will improve conditions for people around the world, but with the big caveat that it will not make things better for everyone. Blinder argues that two things are driving globalization, and associated phenomena such as offshoring or outsourcing. The first is technological innovation, especially in information and communication technology, the second being the more systematic entry of huge numbers of workers into the world economy in countries such as China, India, and Eastern Europe, workers willing and able to perform information based or manufacturing jobs more cheaply that workers in more developed nations.
Blinder writes:
“Looking at these two historic forces from the perspective of the world as a whole, one can only get a warm feeling. Improvements in technology will raise living standards, just as they have since the dawn of the Industrial Revolution. And the availability of millions of new electronically deliverable service jobs in, say, India and China will help alleviate poverty on a mass scale. Offshoring will also reduce costs and boost productivity in the United States. So repeat after me: Globalization is good for the world. Which is where economists usually stop.”
Blinder doesn’t stop there. He also points out that globalization will have ill effects on some. Globalization and freer trade may be related to greater total production of wealth, but it also changes the distribution of wealth. In some ways this is good, as with the degree of poverty alleviation that increased numbers of jobs brings to places like India or China. For workers in the U.S. or Western Europe whose jobs are offshored, their share of wealth clearly drops, and as Blinder writes, this will potentially affect large numbers of people. “In some recent research, I estimated that 30 million to 40 million U.S. jobs are potentially offshorable. These include scientists, mathematicians, and editors on the high end and telephone operators, clerks and typists on the low end.”
Blinder argues that some reforms could be implemented to ease the transition, such as better economic safety nets for displaced workers, and changes to education to emphasize training for flexibility and for the sorts of jobs least likely to be offshored, but he is ultimately gloomy about the prospects of such reforms being implemented and warns of a rough transition for many Americans.
Globalization is not a panacea for people in China or India or Sub-Saharan Africa either. The jobs being offshored to such countries are generally low-wage (or else they wouldn’t be offshored there), and sometimes associated with dangerous working conditions. In an earlier post, “A Different Globalization for Labor,” I wrote:
“Another common assumption is that such globalization processes are also bad for labor in the developing nation contexts that manufacturing and service jobs are being outsourced to, e.g. promoting sweat shop labor conditions. Robert J. Flanagan has recently published an important book on this topic, Globalization and Labor Conditions (Oxford University Press, 2006). Flanagan closely examines the available data on labor conditions around the world. He is clearly sympathetic to critiques of globalization, but comes to the conclusion that overall, globalization has led to improved conditions for labor in much of the world. He in no way implies that globalization processes make things wonderful for workers in developing countries. As he documents, there are things like sweatshop labor associated with globalization, but there are more overall jobs and fewer jobs with the worst labor conditions in more open developing economies – hardly what I’d consider a ringing endorsement, but still having more crappy jobs available might be better than having fewer or no crappy jobs available, even while still not good.”
What do I conclude from all this? Globalization and more trade (and the greater production of wealth associated with it) has its problems – and major problems at that for workers in all countries. At the same time, globalization is here to stay, and to the extent that production of greater wealth is a precondition for increasing individual human freedom in general, there are positive developments associated with globalization as well. As Blinder points out, economists and other free trade apostles often emphasize what is positive or what they see as positive about globalization and ignore the rest. Leftists of a variety of stripes just as often emphasize what is negative or what they see as negative and ignore the rest. The goal, as I see it, should be an emphasis on more equitable distribution of wealth (which would entail things like better social safety networks, better job training and re-training programs, better regulation of work conditions globally, emphasis on freedom of speech and assembly so that workers could better organize and act collectively, emphasis on often neglected aspects of “free” trade – freer movement of labor and reduced agricultural subsidization in rich countries, etc.) within a system of global trade and development which is sustainable (which would require positive work on global warming and major diseases, such as malaria and AIDS).
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