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Wednesday 31 August 2011

It's Education, Stupid !








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It’s that time of year when I spend much of my time reading the books that have been nominated for the FT/Goldman Sachs Business Book of the Year. It’s a judging duty that is both a pleasure and a pain. The pain is the sheer amount of time it takes to wade through thousands of pages.  The pleasure is reading books that would not necessarily cross my path. This year, as with the last, many of these books are written by economists and, understandably, focus on the state of the world economy. It is interesting to read how many agree that education and training are crucial to long-term economic success, for individuals, companies and countries. I made a similar argument in my most recent book The Shift, focusing in particular on the types of education and training that create specialization. Here are the two reasons why it has never been so critical to become educated:


  • Rampaging connectivity – will see at least five billion people around the world using some form of mobile device to download information, access knowledge and coach and teach each other. Some will have the intellectual capacity and motivation to really make something of this extraordinary opportunity, wherever they happen to be born. These people will want to join the global talent pool and, if possible, migrate to creative and vibrant cities. By doing so, this vast crowd of talented people will increasingly compete with each other, continuously upping the stakes for what it takes to succeed.

  • The technological revolution – brought mobile devices to billions, and is now transforming how work gets done. Robots are taking the place of unskilled and semi-skilled workers, while business analytics, modelling and collaborative technologies are taking away much of what has traditionally been the role of the middle manager. However, while technology may be replacing the mechanical aspects of work, it is not replacing the more complex, skilled work that involves creativity and innovation. That’s the high value piece that remains, and it is once that requires education and training. 

As high quality education becomes more of a premium, we can expect the sector to begin to transform itself even more rapidly. Just what this transformation will look like is difficult to predict with accuracy. But here are two emerging trends that I believe will shape it over the coming decades:

The Gutenberg Project: the race is on to digitalise many of the books and articles of the world, while the professors of academic institutions such as MIT are making their key lectures available on the web. Combined with hyper connectivity and the potentially global reach of the Cloud, this means that knowledge and wisdom will be available to anyone with access to the Internet. This could see the development of new ways of educating that leapfrog those of normal educational institutions, creating more fluid, virtual and vibrant networks of learning. 

Virtual Schools and Universities: there has been a great deal of research over the last decade focusing on how people learn. This has looked at e-learning, face-to-face teaching and over-the-phone coaching. What has become clear is that none of these on their own are the best; it’s the combination of all three that has the greatest impact. This is important for educational strategies since at least two of these processes are virtual, and F2F can largely be substituted by video conferencing. I saw the speed of this transformation recently when I visited UOC (Universitat Oberta de Catalunya) in Barcelona. Its sleek headquarters are the hub of a virtual university that has 60,000 students (and growing) taught by a faculty of over 3,000 virtual educators. Using simulations, games and collaborative environments, the institution is building deep expertise in supporting education across the world.

Some have argued that, of all the institutional forms, education has changed least over the past few decades. It looks as if the need for deeper knowledge and rapid advances in learning technologies may change all that.

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Can The U.S. Super Committee Solve The Debt Crisis?






America’s relentlessly-escalating national debt seems like a problem that defies resolution. Congress and the Obama administration couldn’t solve it recently when they agreed to raise the U.S. debt ceiling by another $2.1 trillion.

5 Ways The United States Can Get Out Of Debt
see photosAFP/Getty ImagesClick for full photo gallery: 5 Ways The United States Can Get Out Of Debt

Instead of agreeing on measures to reduce the country’s staggering debt, Congress and the president handed off the problem to a so-called Super Committee. The 12-member, bipartisan committee of national legislators, with an equal number of Democrats and Republicans, will study U.S. finances and recommend $1.2 trillion in budget cuts by November 23. (Read more: “Can The U.S. Regain Its AAA Rating?“)

Reaching an Agreement If the committee reaches an agreement on budget cut proposals, Congress must vote approval on them by December 23. If Congress votes on them accordingly, the $1.2 trillion in cuts will go into effect. As usual, however, the issues will be what gets cut and by how much.

There are many items on the committee’s agenda for discussion, including: raising taxes, revamping the tax code, Social Security, Medicare, Medicaid, healthcare for the elderly and the federal retirement program; these are all major issues that have been long debated in Congress.

Also up for debate and possible reduction is the 35% U.S. corporate tax rate. Many Democrats and Republicans agree that the rate is too high relative to rates imposed in other countries. Democrats, however, have proposed plugging tax loopholes as a means of making up the difference in revenue if the corporate rate is lowered.

So the committee may have a difficult time finding ideas that everyone – including their constituents – can agree on. For example, another particularly controversial tax deduction that some legislators proposed eliminating is the home mortgage interest exemption. A USA Today/Gallup poll conducted this spring asked survey participants if they would approve eliminating that deduction if overall tax rates were also lowered. Sixty-one percent opposed the idea.



What if an Agreement Can’t be reached? In the event that the committee fails to reach an agreement, $1.2 trillion in budget cuts will be automatically imposed in equal amounts on domestic and defense spending.

With committee members divided equally along opposing political lines, many observers believe a stalemate is inevitable.

The 12 appointed members are:
  • Rep. Jeb Hensarling of Texas (Republican and committee co-chair):  Chairman of the House Republican Conference.   

  • Sen. Patty Murray of Washington (Democrat and committee co-chair):  She is a member of the Budget and Appropriations committees.

  • Rep. Chris Van Hollen of Maryland (Democrat): Van Hollen is the ranking Democrat on the Budget Committee.

  • Sen. Jon Kyl of Arizona (Republican): The number two ranking Republican in the Senate behind Mitch McConnell and a member of the Finance Committee.

  • Sen. John Kerry of Massachusetts (Democrat): A former presidential candidate in 2004 against incumbent George W. Bush, he is a member of the Finance Committee.  

  • Sen. Pat Toomey of Pennsylvania (Republican): Elected to the Senate last year. Member of  the Senate Budget and Banking committees.

  • Sen. Max Baucus of Montana (Democrat): Chairman of the Senate Finance Committee.  Also served on Obama’s debt commission.

  • Sen. Rob Portman of Ohio (Republican): Former White House budget director in the Bush administration, and a member of Budget Committee.

  • Rep. Xavier Becerra of California (Democrat): A senior member of the House Ways and Means Committee

  • Rep. Dave Camp of Michigan (Republican): Chairman of the House Ways and Means Committee.   

  • Rep. James Clyburn of South Carolina (Democrat): The third-ranking Democrat in the House and a member of the Appropriations Committee.

  • Rep. Fred Upton of Michigan (Republican): Chairman of the House Energy and Commerce Committee.  

Committee members reportedly will draw upon previously proposed solutions from Republican and Democratic legislators, independent groups, Obama’s 2010 bipartisan deficit commission, among others, as a basis for discussion.

The American public, eager for solutions and an end to partisan bickering, have nevertheless been warned by analysts and former policy makers not to expect too much from the committee.

Reaching an Agreement If the committee reaches agreement, as a political and practical matter, the suggestions are expected to be narrow in focus and likely to win Congressional approval, while the still nagging major issues will remain: long term taxes and entitlements.

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Monday 29 August 2011

Libya, from ally to devil in six months !





WATCHING rebel gunmen rampage through Col Muammar Gaddafi's Bab al-Aziziya compound – once Tripoli's Forbidden City – was a strange experience for me.

I spent an evening there with Gaddafi in 1987, a year after it was bombed by US warplanes. Libya's "Brother Leader" talked about the Middle East, Palestine, North Africa. He led me by the hand through his ruined private quarters, still reeking of fire and smoke, and showed me the bed in which an American 1,000kg laser-guided bomb killed his two-year-old adopted daughter.

We sat in his gaily coloured Bedouin tent, talking into the night. He opened up to me about his love for fancy dress and beamed happily when I told him, tongue in cheek, how attractive he was to western women.

Call this dictator nostalgia – a feeling not of course shared by a majority of Libyans who are now trying to hunt down their deposed leader of 42 years. Few will miss him. Gaddafi was a blight on Libya and an embarrassment to the Arabs.

Meanwhile, Libya is literally turning into a gold rush as the big western oil firms pile into Libya and pay court to the new government in Tripoli, the National Transitional Council.

Police units and troops from Britain, France and Italy may soon follow – all, naturally, as part of the west's new "humanitarian intervention" strategy that has replaced "counter-terrorism".

Libya is in semi-chaos and its economy devastated by six months of conflict. The food distribution system has broken down. Thousands of heavily armed "rambos" make their own law. There are barely any state institutions aside from the national oil company and central bank. The secret police have evaporated.

As a modest historian, I am delighted when history draws striking parallels. We now see the fascinating spectacle of those old colonial powers, Britain, France, and Italy, starting to move back into their former overseas possessions.

Britain ruled Libya until a young colonel named Muammar Gaddafi overthrew the doddering old British puppet, King Idris. The US lost one of its largest bomber bases at Libya's Wheelus Field. Neither nation was to forgive Gaddafi.



Imperial Britain had seized Libya from Italy's fascist regime in 1943. Italy colonised Libya after tearing it away from the crumbling Ottoman Empire. Italy used concentration camps and poison gas to terrorise Libyans into submission.

France, whose colonial empire included neighbouring Tunisia, Algeria, Morocco, Chad, and Niger, long competed with Italy and Spain for regional domination. Mussolini's Fascist regime pressed claims to Tunisia, Corsica, Nice and Cannes.

An obscure colonial border dispute over Chad's Aouzou Strip dating from the 1920's between France and Italy led to a nasty little Franco-Libyan border war there in 1987.

French Foreign Legionnaires in jeeps, disguised as Chadian nomads, drove the wretched Libyan army from Aouzou in what became known as the "Toyota War". Disguised French special forces and Legionnaires, as well as Britain's SAS, just used the same theatrical tactics in Libya.

The big question now is which foreign power will dominate Libya. The United States, which has waged this little war from well offstage? Italy, which gets most of its oil from Libya? France, where President Sarkozy has been hinting at a Mediterranean union – bien sure, under French tutelage?

Oil is a potent aphrodisiac. Libya has vast reserves of premium, low-sulphur oil and gas, and a hundred-year supply of ancient artesian water.

Energy-rich Libya will become an important market for European consumer products and industrial exports, as well as a huge major supplier of investment funds from its estimated US$50 billion worth of annual oil exports.

There are more prizes to be had: Libya's gold reserves, estimated at US$4-5 billion; and its nearly US$100 billion of foreign deposits and investments.

The files of its intelligence agencies which may reveal the true story behind the bombings of a French and US airliner in the 1980's.

Western intelligence will also want to talk to Gaddafi's intelligence chief, closest confidant and brother-in-law, Abdullah Senoussi, with whom I spent a most interesting evening in Tripoli. France has a warrant out for his arrest for the 1989 bombing of a UTA airliner over Niger.

It's likely US, British and French intelligence have already grabbed Gaddafi's files.

Eric S. Margolis is an award-winning, internationally syndicated columnist, writing mainly about the Middle East and South Asia. Comments: letters@thesundaily.com

Related Post:
Ex-colonizers aid Libyan Rebels Assault on Tripoli 'planned weeks ago';No easy transition, rebuilding after Gaddafi  

Malaysia's future: A time for Malay renewal !





A time for renewal, too

Ceritalah By KARIM RASLAN

The debate over Malay identity is fundamental to Malaysia’s future. Only when tensions within the Malay community itself are cooled will the resentment and grievances between Malaysia’s ethnic groups be resolved.

AS I reflect over the events of the fasting month – and indeed the past 12 months – I cannot help but conclude that Malaysian Malays are facing an existential crisis, which is primarily political in nature.

Moreover, because the Muslim/Malay community is dominant numerically; its tribulations will impact the rest of the nation.

In short, no one can be insulated from the community’s uncertainties.

Sadly, Malaysia’s communal peace has been further rocked by the Jais raid on the Damansara Utama Methodist Church (DUMC).

This has been accompanied by a steep increase in the number of claims of Christian proselytising amongst Muslims.

Such fears over murtad are nothing new.

They have been current for years, even decades, peaking in times of political uncertainty: witness the Maria Hertogh riots back in 1950.

However, we need to put things in perspective; 2011 is not 1950.

Malay/Muslims currently outnumber non-Muslims significantly. In short, demography favours the ummah. Moreover, the position of Islam is constitutionally-assured.

Nonetheless, the re-emergence of the murtad issue suggests a more deep-rooted anxiety among Malay-Muslims about the future.

Indeed, there are fundamental concerns about the Muslim response to both globalisation and modernity.

How do we maintain our faith and culture in an era when interaction with non-Muslims has become both a norm and a necessity?

The ummah has responded to such challenges differently and this reflects the Malay/Muslim community’s underlying heterogenity.

Contrary to Umno’s obsession with Malay unity, the community is by no means monolithic.

At the same time, political developments post-2008, have heightened and accentuated these shifts – lending them a partisan hue as PAS, Umno and PKR have weighed in on various issues.

As these differences of opinion surface, we are faced with a secondary challenge: how do we deal with disagreements over what it means to be Malay and Muslim?

Can we maintain our dignity, objectivity and calm when face-to-face with opposing views? How do we manage when our major political parties – PAS and Umno – assume conflicting positions?

Amid the debate, many are electing to withdraw, preferring isolation to engagement. Such a retreat makes dissent, however reasonable, even more complicated and potentially dangerous. To my mind, withdrawal is a disaster.

The Malay community has always possessed an outward-looking mindset. We cannot, and should not, abdicate from our engagement with the world. We have thrived by exchanging ideas and knowledge with others as traders, scholars and travellers. Indeed, the decline of the Muslim world came when we closed our hearts, minds and borders.



Still, I am not disputing the need for Muslims to maintain their faith, but the notion that the only way we can do this is by shunning non-Muslims and/or trampling on the rights of minorities is nonsensical.

Doing so will only reinforce the misperception that Islam is intolerant and regressive. It also hastens our own decline.

Given these concerns I’ve been heartened by Prime Minister Najib Razak’s recent attempts to recapture the centre ground.

His willingness to end censorship and reform the electoral system is most welcome.

It displays an openness (however belated) to listen to others. This is courageous given the narrow-mindedness of many of his fellow party members.

However, opening up in the midst of a debate is always tough. Will tentative changes be enough to satisfy an increasingly restive Malay (and Malaysian) public? Will it be too little and too late?

The debate about Malay identity is fundamental to Malaysia’s future.

It will become increasingly heated and painful. For example, Malay identity cannot be separate from the role of the Rulers. This bond has to be examined and questioned.

Given the depth and breadth of the upcoming debate we must ask whether Umno alone can manage this process? Indeed, has PAS’ greater moral authority sidelined the party of Merdeka?

The consequences of half-hearted reforms are obvious if we look across the Causeway to Singapore where the presidential elections have just been concluded.

While the PAP government deserves praise for allowing all four candidates to campaign openly – providing them with equal mainstream media coverage, there’s no doubt that many Singaporeans feel “shortchanged”.

Reforming from within rarely satisfies. Indeed, Dr Tony Tan’s incredibly slim margin of victory underlines the unhappiness of ordinary Singaporeans who expect much, much more from their politics.

Malaysians will be like their cousins across the Causeway. They won’t be willing to suffer timidity and half-hearted reforms.

Tentative steps will be swept away by a tide of popular resentment. Indeed, boldness will be the only solution.

At a time when the very core of Malay identity is being debated, piecemeal reform will not be enough. Reform will go nowhere unless the state loosens its grip.

The Najib administration must recognise that a mere shift in tactics will not be enough to win back Malaysia’s cynical and jaded electorate, especially the Malays.

The last three years have taught us that the Malay/Muslim community is becoming more complex and indeed, difficult to please.

As Umno and the Prime Minister discovered during the Bersih 2.0 debacle, it is no longer possible to succeed solely on emotive appeals for ethnic and religious unity.

Rather, Najib and his government must be willing to accept the diversity that now exists within Malay discourse, and tailor their policies accordingly.

Indeed, Umno no longer controls the debate.

For instance, economic policies need to champion the interests of middle- and working-class Malays, rather than expecting them to automatically back the ventures of the intra-ethnic elite.

Barisan has to keep asking themselves: what’s really in it for the people?

Furthermore, differing views over culture and faith must be allowed rather than repressed.

Indeed, one feels that such an approach may very well work among every race in Malaysia in general.

All the same, the resentment and grievances between Malaysia’s ethnic groups can only be resolved when tensions within the Malay community itself are cooled.

This Hari Raya must not only be a time of celebration for Malaysian Malays, but also renewal.

Related posts:

Malaysia still in pursuit of full independence 

The true meaning of independence

 Reviving our winning ways     

Sunday 28 August 2011

Rage of the youth is growing !





By Pankaj Mishra, Guardian News & Media Ltd

Even in the West there is little chance of stable jobs or affordable education. A secure and dignified life seems even more remote for most. Across the world, the rage will grow.

Supporters of Anna Hazare wave Indian flags and shout slogansImage Credit: AP
  • Supporters of Anna Hazare wave Indian flags and shout slogans during 12th day of Hazare's fast against corruption in New Delhi on Saturday.

In India, tens of thousands of middle-class people respond to a quasi-Gandhian activist's call for a second freedom struggle — this time, against the country's venal "brown masters", as one protester told the Wall Street Journal. Middle-class Israelis demanding "social justice" turn out for their country's first major demonstrations in years. In China, the state broadcaster CCTV unprecedentedly joins millions of cyber-critics in blaming a government that placed wealth creation above social welfare for the fatal high-speed train crash last month.

Add to this the uprisings against kleptocracies in Egypt and Tunisia, the street protests in Greece and Spain, and you are looking at a fresh political awakening. The grievances may be diversely phrased, but public anger derives from the same source: extreme and seemingly insurmountable inequality.

As Forbes magazine, that well-known socialist tool, describes it, protesters everywhere are driven by "the conviction that the power structure, corporate and government, work together to screw the broad middle class" (and the working class too, whose distress is not usually examined in Forbes).

For years now, the mantra of ‘econ-omic growth' justified government interventions on behalf of big business and investors with generous tax breaks (and, in the West, the rescue of criminally reckless speculators with massive bailouts). The fact that a few people get very rich while the majority remains poor seemed of little importance as long as the GDP figures looked impressive.



In heavily populated countries like India, even a small number of people moving into the middle class made for an awe-inspiring spectacle.

Helped by a ‘patriotic' corporate media, you could easily ignore the bad news — the suicides, for instance, of hundreds of thousands of farmers. However, the illusions of globalisation shattered when even its putative beneficiaries — the educated and aspiring classes — began to hurt from high inflation, decreasing access to education and other opportunities for upward mobility.

False promises

Economic growth is no defence against the frustration of the semi-empowered. The economies of both India and Israel have recorded dramatic growth in recent years. But inequality has also grown spectacularly. The Financial Times, which recently compared India's oligarchic business families to Russia's mafia-capitalists, pointed out two weeks ago that "the 10 largest business families in Israel own about 30 per cent of the stock market value" while one quarter of Israeli families live below the poverty line.

Last month the Indian supreme court blamed increasing social violence in the country on the "false promises of ever-increasing spirals of consumption leading to economic growth that will lift everyone".

Obviously it is not the supreme court's remit to define India's economic policies. Nor should Anna Hazare be entrusted with establishing the office of an anti-corruption ombudsman, a mission that amounts to nothing in a country littered with compromised and impotent institutions.

Still, they respond, however incoherently, to a crisis of legitimacy afflicting their country's highest institutions, and their supposed watchdog, the media.

In the last decade, billionaires, ‘billionaire-friendly' legislators and CEO-worshipping journalists have together constituted what the political economist Ha Joon Chang calls a "powerful propaganda machine, a financial-intellectual complex backed by money and power".

Nevertheless, the real facts about ‘economic growth' are getting through to those most vulnerable to it in both the east and the west: the young.

Denouncing "the corruption among politicians, businessmen and bankers" that leaves "us helpless, without a voice", the manifesto of the Spanish indignados could have been authored by the Indian supporters of Hazare.

Even as they export jobs and capital to Asia, economic globalisers in the West continue to preach the importance of upgrading skills at home. Yet the dead-end of globalisation looms clearly before Europe and America's youth: little chance of stable employment, or even affordable education.

The violence in European cities this year comes at the end of a long cycle of steady socio-economic growth. In postcolonial India and China this cycle had barely begun before it began to splutter. A secure and dignified life seems even more remote for most.

Worried by the prospect of social unrest, China's leaders frankly describe their nation's apparently booming economy as "unstable, unbalanced, uncoordinated and ultimately unsustainable".

The Chinese philosopher Zhang Junmai once wrote that an agrarian country has few ‘material demands' and can exist over a long period of time with ‘poverty but equality, scarcity but peace'. Returning to an austere age of wisely managed expectations is no longer possible — even if it was desirable. It remains to be seen what political forms this summer's unrest will take. But there is no doubt that many more people across a wide swathe of the world will awaken with rage to what Zhang warned against: "A condition of prosperity without equality, wealth without peace."

Pankaj Mishra's new book The Revenge of the East will be published next year

Making a Chinese dream come true





CHINA DAILY By ZHU YUAN

BEIJING: Although Chinese People’s American Dream by Shui Guang was only published recently, it was written more than a decade ago when an increasing number of Chinese people who had left China to study abroad began to consider pursuing their career back home.

It made me wonder whether there is a Chinese dream. And if so, what is it?

Without a native religion in the sense of Christianity or Islam, Chinese people’s ethos is characterised by pragmatism.

There is a Peking Opera piece called Happi­ness from Heaven, its lyrics describe a world in which good weather guarantees a bumper harvest, clean and honest government does not impose heavy taxes, well-disciplined residents do not make unreasonable demands, and everyone lives in happiness and peace.
This would be the dream that the majority of Chinese people pursued in ancient times, when they knew little about science, demo­cracy and social institutions.

This dream was shattered when Western powers forced open China’s door and Western ideas of science and democracy entered the country.

Despite the fact that many ordinary residents still cherished the dream of leading a peaceful and comfortable life, characterised by having land to plough and enough food to feed their family, the ideal of creating a society of equality and fairness appealed to some Chinese intellectuals. Hence, the years of civil wars and the struggle for state power between two major political parties dominated the first half of the last century.



If Chinese people had a dream during that period, it was for nothing more than to live in peace.

The founding of People’s Republic of China was the start of a period in which collective consciousness left little room for people to pursue an individual dream. They were told that everyone would be able to get what he or she needs in a communist society, but people must first make sacrifices for its realisation and the common good.

It was not until the late 1970s when the reform and opening-up policy was implemented that Chinese residents as individuals started to pursue their own dreams again.

Market competition in a great variety of fields made it possible for individuals to be audacious enough to cherish a dream of prosperity and success that might be achieved through their own efforts.

After more than half a century of state employment, Chinese people could quit their job to start a business on their own, they could go abroad to study, they could even idle away their time if they had the means to support themselves. They could do anything as long as they did not break the law.

Yet, the dream of a better life is not as simple as it used to be. People used to be content with having enough to eat and wear and a place to live. With much higher living standards and more materialistic temptations, they now have much higher demands of life.

To be a true Chinese Dream, the opportunity should be there for all. However, the increasingly serious corruption among government officials and the widening gap between the haves and have-nots tilt the distribution of social resources and wealth in favour of those in power and those who can manipulate power with money and/or connections. This dampens ordinary residents’ enthusiasm to struggle for their dreams and encourages people to make their dream come true through irregular means.

Common prosperity once identified by Deng Xiaoping as the ultimate goal of economic reform and opening-up necessitates a political will to ensure that the distribution of social wealth is fair.
Roadside billboard of Deng Xiaoping in Dujiang...Image via Wikipedia
A Chinese dream, if there is one, should not be that different from its American counterpart – that life can be better, richer and fuller for everyone, with opportunity for each according to ability and achievement regardless of social class or circumstances of birth.

But to achieve this, great efforts are needed on the part of the government and all residents to create an environment in which, as Confucius said, people can go confidently in the direction of their dreams and live the life they have imagined.

US Treasuries not safe, said don






Don: US Treasuries not safe, emerging economies should find other ways to buffer themselvesNational debt clockImage via Wikipedia

JACKSON HOLE, Wyoming: Emerging economies should find other ways to buffer themselves from global crises than stockpiling US government debt, a prominent economist argued.

US Treasuries and the debt of other advanced nations might be liquid, but it was far from safe, Cornell University professor Eswar Prasad said in a paper presented to a group of central bankers gathered here.

Emerging countries seeking protection from global shocks by individually stocking up on US debt would be better off banding together to create a pool of funds that could be drawn on in a crisis, he argued. Doing so would give them a backstop should they need it, without saddling their national investment portfolios with debt that could turn sour.



Sharply rising levels of public borrowing and weak growth prospects in the United States mean that over time the dollar will continue to decline against the currencies of faster-growing emerging markets, eroding the value of emerging nations' foreign investments, he said. And the risks are not only for the long-term. The United States' near brush with default earlier this month, as lawmakers refused to raise the country's borrowing ceiling until a deficit-cutting deal was reached, brought the potential pitfalls of holding US debt into sharp relief.

“As demonstrated by recent events in the eurozone, bond investors both domestic and foreign can quickly turn against a vulnerable country with high debt levels, leaving the country little breathing room on fiscal tightening and precipitating a crisis,” Prasad wrote. “The US is large, special and central to global finance, but the tolerance of bond investors may have its limits.”

The dollar has long been the world's main reserve currency, and since the financial crisis emerging economies have built their reserves by buying Treasuries and the debt of a few other advanced economies, according to Prasad.

Any change could hurt the ability of the United States to borrow at low rates despite soaring debt levels.
That would turn the tables in a world where traditionally it was developed nations that pressured developing ones to bring their finances under control, he said.

“It is high time for advanced economies to take the tonic of macroeconomic and structural reforms that they have for so long dispensed to the emerging markets,” he said. Reuters

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Arab spring has created 'intelligence disaster', warns former CIA boss






Michael Scheuer says rendition should be brought back as lack of intelligence has left UK and US unable to monitor militants
Michael Scheuer, the former head of the CIA unit in charge of pursuing Osama bin Laden, said the Arab spring had ‘delighted al-Qaida’. Photograph: Murdo Macleod

The Arab spring has “delighted al-Qaida” and caused “an intelligence disaster” for the US and Britain, the former head of the CIA unit in charge of pursuing Osama bin Laden has warned.
Seal of the Central Intelligence Agency of the...Image via Wikipedia

Speaking at the Edinburgh international book festival, Michael Scheuer said: "The help we were getting from the Egyptian intelligence service, less so from the Tunisians but certainly from the Libyans and Lebanese, has dried up – either because of resentment at our governments stabbing their political leaders in the back, or because those who worked for the services have taken off in fear of being incarcerated or worse.

"The amount of work that has devolved on US and British services is enormous, and the result is blindness in our ability to watch what's going on among militants."

The Arab spring, he said, was "an intelligence disaster for the US and for Britain, and other European services".



Scheuer headed the Bin Laden unit at the CIA from 1996 to 1999, and worked as special adviser to its chief from 2001 to 2004. The author of a biography of Bin Laden, he now teaches on the peace and security affairs programme at the University of Georgetown.

He said: "The rendition programme must come back – the people we have in custody now are pretty long in the tooth, in terms of the information they can provide in interrogations.

"The Arab spring has been a disaster for us in terms of intelligence gathering, and we now are blind both because of the Arab spring and because there is nothing with which to replace the rendition programme."

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Saturday 27 August 2011

When It Comes to Pursuing Your Goals, Let You Unconscious Be Your Guide






ScienceDaily (Aug. 26, 2011) — A new University of Alberta study says when it comes to goal setting, your unconscious mind can be a great motivator.

Alberta School of Business researcher Sarah Moore and colleagues from Duke and Cornell universities say that unconscious feelings about objects in the environment influence the pursuit of long-term goals. Their study explores how the unconscious mind responds to objects in relation to an individual's goals -- and how the unconscious continues to influence feelings about these objects once the goals are reached -- whether or not the outcome has been successful.

LONDON, ENGLAND - AUGUST 20:  David James and ...Image by Getty Images via @daylife
In Freud we should trust?

"In the past few years, we recognized that some of [Sigmund] Freud's ideas on the unconscious mind were, in fact, correct and that a lot of our decision-making and a lot of our feelings are based on things that we're not really aware of," said Moore, who is an assistant professor in the Alberta School of Business. "In our study, we looked at how our unconscious feelings about objects in the environment influence how we pursue goals."

Moore notes that previous studies have shown that when it comes to short-term, finite goals, such as responding to basic needs (for example, thirst or hunger), the unconscious will evaluate objects and form preferences based on whether the object will help an individual achieve the goal. She says that in the case of thirst, items such as a water fountain or a bottle of Coke will be seen favourably, while a chocolate bar or KFC sign would not. However, she explains that, once the goal is reached, those same objects will be evaluated differently.



"Once your thirst is quenched, you don't evaluate the water fountain positively anymore because you've accomplished the goal," she said, " but there are differences when we look at long-term goals."

Win some, lose some -- but goal still important

Moore's research focused on longer-term goals, such as getting in shape or undertaking educational pursuits. For both types of goals, she says, the process is similar in that the unconscious identifies and responds to positively to objects and triggers in the environment that support the goal. However, the unconscious deals differently with these objects during progress towards long-term goals. Moore says that, unlike with short-term finite goals, the unconscious will continue to positively value objects related to the long-term goals even after a level of success has been achieved. She says this phenomenon points to the indeterminate nature of the goal.

"In some sense, we're never 'finished' long-term goals," said Moore. "If we successfully finish the small steps toward our long-term goals, it becomes a cycle: we take a small step, we succeed, we feel good about it; therefore, we continue to feel good about the long-term goal. This process makes us more likely to take the next small step toward achieving that goal."

What was surprising for the researchers was how participants in their study reacted to objects after a failure. While the researchers expected the participants who failed to react negatively or express dislike for objects related to their test goal, Moore and her colleagues found that failure resulted in a neutral view of the objects.

"You don't hate the objects related to the goal because that goal is very important to you in the long run," said Moore. "Your unconscious is telling you 'now is not the time to pursue the goal. You just failed, let's leave it alone for awhile. We're not going to pursue these objects in the environment; we're going to switch to some other goal.'"

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Equation helps keep Cars Tyres on the road longer






Jamie Condliffe, contributor

Ever wondered how long it's going to be until you have to change the tyres on your car? Wanted to calculate how far around the world one set of treads could take you? Or even just felt like spending a long weekend doing some complex math?
Studded tyreImage via Wikipedia
The solution could well be here. A team of researchers from the School of Automobile Studies at Tongji University, China, have developed a new equation that predicts the rate at which tyres wear. The results could help save the haulage industry millions of dollars - and they might even ease the strain on your pocket, too.

As you'd expect, their results, published in Journal of Vibration and Control, show that wear is related to the contact area on the road, the physical properties of the rubber, the friction between the road and tyre, any skidding that occurs, and the weight of the vehicle.



More interesting than the equation, though, is the analysis that the team performed to find out which parameters affect tyre wear the most - not least because it might mean you don't need to shell out for new tyres so often.

You won't be surprised to find out that the biggest factors contributing to wear are side slip, speed, and the mass of the car itself. That means that if you want your tread to last longer, you should cut down on the skids and speeding, and kick out any unwanted passengers while you're at it. Other big offenders are low tyre pressures - so keep them pumped up - and ambient temperature.

But maybe the biggest shock is that the car's suspension and the road surface that's driven on make hardly any difference to tyre wear at all. So boy racers whose cars feature suspension lowered so far they have to drive slowly down rough streets to avoid damage have one saving grace - they're caring the planet, four tyres at a time.

The Nine Habits of Highly Healthy & Effective People





by Jonny Bowden 
 
For years, business and motivational gurus have known that there are basic habits that seem to predict professional success and excellence. Books like "The Seven Habits of Highly Effective People", by motivational speaker and business guru Stephen Covey, PhD has sold over 15 million copies alone, to people hungry for the secrets of success.
Book Cover                    Image via Wikipedia
We don't yet have the perfect formula for long life, happiness and physical health, but a little careful distillation of the massive amount of research on health and longevity reveals that cultivating nine basic habits will significantly increase the odds of your living long, well and happily, in a robust, healthy, weight-appropriate body.

1. Eat your vegetables. No kidding. And I'm talking at least 9 servings a day.. Unless you're following the most stringent first stage of the Atkins Diet, you should be able to consume 60-120 grams of carbs a day (depending on your weight and exercise level), and you'd have to eat a stockyard full of spinach to get to that amount. Every major study of long-lived, healthy people shows that they eat a ton of plant foods. Nothing delivers antioxidants, fiber, flavonoids, indoles, and the entire pharmacopia of disease fighting phytochemicals like stuff that grows.

2. Eat fish and/or take fish oil. The Omega-3's found in cold-water fish like salmon deserve the title of "wellness molecule of the century". They lower the risk of heart disease, they lowerblood pressure, they improve mood and they're good for the brain. And if you're pregnant, they may make your kid smarter!

3. Connect. And I'm not talking about the internet. In virtually every study of people who are healthy and happy into their 9th and 10th decade, social connections are one of the "prime movers" in their life. Whether church, family, volunteer work or community, finding something you care about that's bigger than you that you can connect with and that involves other people (or animals) will extend your life, increase your energy, and make you happier. Only always.



4. Get some sun. At least 10-15 minutes three times a week. Interestingly, a recent study of four places in the globe where people lived the longest and were the healthiest noted that all four places were in sunny climates. Sun improves your mood and boosts levels of cancer-fighting, performance-enhancing, bone-strengthening vitamin D, a vitamin most people don't get nearly enough of.

5. Sleep Well. If you're low in energy, gaining weight, grumpy and looking haggard, guess what?- chances are you're not sleeping nearly long enough nor well enough. By sleeping "well", I mean uninterrupted sleep, in the dark, without the television on, in a relaxing environment. Nothing nourishes, replenishes and restarts the system like 7-9 hours sleep. Hint: start by going to bed an hour early. And if you've got a computer in the bedroom, banish it.

6. Exercise every day. Forget this 20 minutes three times a week stuff. Long lived people are doing things like farm chores at 4:30 in the morning! Our Paleolithic ancestors traveled an average of 20 miles per day. Our bodies were designed to move on a regular basis. New studies show that merely 30 minutes a day of walking not only reduces the risk of most serious diseases, but can even grow new brain cells!

7. Practise Gratitude. By making a list of things you're grateful for, you focus the brain on positive energy. Gratitude is incompatable with anger and stress. Practise using your under-utilized "right brain" and spread some love. Focusing on what you're grateful for - even for five minutes a day - has the added benefit of being one of the best stress -reduction techniques on the planet.

8. Drink red wine or eat red grapes. The resveratrol in dark grapes is being studied for its effect on extending life, which it seems to do for almost every species studied. (So does eating about 1/3 less food, by the way.) If you've got a problem with alcohol, you can get resveratrol from grapes, peanuts or supplements. (And if you're a woman, and you choose the alcohol option, make sure you're getting folic acid every day.)

9. Get the sugar out. The number one enemy of vitality, health and longevity is not fat, it's sugar. Sugar's effect on hormones, moods, immunity, weight and possibly even cancer cells is enormous, and it's all negative. To the extent that you can remove it from your diet, you will be adding years to your life and life to your years.

This list may not be perfect and it may not be complete, but it's a start. As my dear grandmother used to say, "Couldn't hurt". Not one of these "habits" will hurt you, all will benefit you, and some may make the difference between life and death.

And it's never too late to start cultivating them.

Enjoy the journey!

65 million more obese adults in the US and 11 million more in the UK expected by 2030!






The rising prevalence of obesity around the globe places an increasing burden on the health of populations, on healthcare systems and on overall economies. A major challenge for researchers is to quantify the effect of these burdens to inform public policies. Using a simulation model to project the probable health and economic consequences from rising obesity rates in the United States and the United Kingdom, researchers at Columbia University's Mailman School of Public Health and Oxford University forecast 65 million more obese adults in the U. S. and 11 million more in the U.K. by 2030, leading to millions of additional cases of diabetes, heart disease, stroke, and cancer. The findings suggest that medical costs associated with treatment of these preventable diseases in the U.S. alone will increase by $48-66 billion per year.
Picture of an Obese Teenager (146kg/322lb) wit...Image via Wikipedia

The paper, "Health and Economic Burden of the Projected Obesity Trends in the USA and the UK," is part of a series of articles on obesity published in the August 27 issue of Lancet. The research was led by Y. Claire Wang, MD, ScD, Mailman School assistant professor of Health Policy and Management, with colleagues from Oxford University.



To construct historic trends in BMI the researchers analyzed data from two nationally representative surveys: the U.S. National Health and Nutrition Examination Survey (NHANES) from 1988 to 2008, and the Healthy Survey for England (HSE) from 1993 to 2008. The U.S. and U.K. have the highest among the countries belonging to the Organization for Economic Cooperation and Development.
Projecting from these data sets: the researchers predicted the following impacts for the U.S. by 2030:
  • Obesity prevalence among men would rise from 32% in 2008 to approximately 50% and from 35% to between 45% and 52% among women.

  • 7.8 million extra cases of diabetes

  • 6.8 million more cases of and stroke

  • 539,000 additional cases of cancer

  • Annual spending on obesity-related diseases would rise by 13-16%, leading to 2.6% increase in national health spending.

  • Total medical costs associated with treatment of these preventable diseases are estimated to increase by $48-66 billion/year.

For the U.K., researchers predicted the following developments by 2030:
  • among men would increase from 26% to between 41—48%, and among women from 26% to 35-43%.

  • 668 000 more cases of diabetes

  • 461,000 more cases of heart disease and stroke

  • 139,000 additional cases of cancer.

  • In the U.K., annual spending on obesity-related health would increase even more rapidly than in the U.S. due to its older population, rising 25%.

"Many chronic and acute health disorders associated with excess bodyweight burden society—not only by negatively affecting the health-related quality of life but also by incurring significant costs," says Dr. Wang. These stem not only from increased healthcare expenditures but also from worker absenteeism, disability pensions, less productivity at work due to poor health, and earlier retirement."

The new study shows that even a small drop in average body mass index (BMI) would have a major health and economic impacts. They therefore recommend action to promote healthier body weights.

"Taking no action would have the catastrophic consequences described in our study, but a population level decrease in BMI by 1% would avoid as many as 2.4 million cases of diabetes, 1.7 million cases of heart disease and stroke, and up to 127 000 cases of cancer in the U.S.alone."

There are currently 99 million obese individuals in the U.S and 15 million in the U.K. The distribution of obesity is somewhat different in the two nations. In the U.S. about one-quarter of all men are obese regardless of ethnicity. Almost half of black American women (46%) are obese, compared with a third of Hispanic women and 30% of white women. In the U.K., the proportion of obese white men (19%) is slightly higher than black men (17%) and much higher than Asian men (11%). One-third of black women in the U.K. are obese, compared with 1 in 5 white women and 1 in 6 Asian women.

While there is some evidence that the rise in obesity is levelling off in some nations and possibly in the U.S., the jury is still out, says Dr. Wang. "Population weight changes are slow to manifest. Whether or not the U.S. and UK have turned a corner or plateaued will not be clear until survey results over the next few years provide additional data points."

The suggestion that obese people die earlier, thus saving the likely expected social and healthcare costs if that person survives to old age, is also discussed in the paper. However the authors conclude, "Without a doubt, healthcare expenditure is high for elderly people, but these costs should not be used to justify the cost-savings of dying younger, or to suggest that obesity prevention has no benefit."

Provided by Columbia University

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Dark clouds over US and Europe !





WHAT ARE WE TO DO By TAN SRI LIN SEE-YAN

Within the past couple of weeks, the world has changed. From a world so used to the United States playing a key leadership role in shaping global economic affairs to one going through a multi-speed recovery, with the emerging nations providing the source of growth and opportunity. This is a very rapid change indeed in historical time. What happened? First, the convergence of a series of events in Europe (contagion of the open ended debt crisis jolted France and spread to Italy and Spain, forcing the European Central Bank or ECB to buy their bonds) and in the US (last minute lifting of the debt ceiling exposed the dysfunctional US political system, and the Standard & Poor's downgrade of the US credit rating) have led to a loss of confidence by markets across the Atlantic in the effectiveness of the political leadership in resolving key problems confronting the developed world. Second, these events combined with the coming together of poor economic outcomes involving the fragilities of recovery have pushed the world into what the president of the World Bank called “a new danger zone,” with no fresh solutions in sight. Growth in leading world economies slowed for the fourth consecutive quarter, gaining just 0.2% in 2Q'11 (0.3% in 1Q'11) according to the Organisation for Economic Cooperation and Development. The slowdown was marked in the euro area. Germany slackened to 0.3% in 2Q'11 (1.3% in 1Q'1) and France stalled at zero after 0.9% in 1Q'11. The US picked up to 0.3% (0.1% in 1Q'11), while Japan contracted 0.3% in 2Q'11 (-0.9% in 1Q'11).

US construction
A construction worker guides a beam into place in Philadelphia. Picture: AFP Source: AFP
IT’S not always sunny in Philadelphia. The Federal Reserve Bank of Philadelphia has reported severe dark clouds over the area’s factory sector. 

The US slides

Recent data disclosures and revisions showed that the 2008 recession was deeper than first thought, and the subsequent recovery flatter. The outcome: Gross domestic product (GDP) has yet to regain its pre-recession peak. Worse, the feeble recovery appears to be petering out. Over the past year, output has grown a mere 1.6%, well below what most economists consider to be the US's underlying growth rate, a pace that has been in the past almost always followed by a recession. Over the past six-months, the US has managed to eke out an annualised growth of only 0.8%. This was completely unexpected. For months, the Federal Reserve had dismissed the economy's poor performance as a transitory reaction to Japan's natural disaster and oil price increases driven by turmoil in the Middle East. They now admit much stiffer headwinds are restraining the recovery, enough to keep growth painfully slow. Recent sentiment surveys and business activity indicators are consistent with expectations of a marked slowdown in US growth. Fiscal austerity will now prove to be a drag on growth for years. Housing isn't coming back quickly. Households are still trying to rid themselves of debt in the face of eroding wealth. Old relationships that used to drive recoveries seem unlikely to have the pull they used to have. Historically, consumers' confidence had tended to rebound after unemployment peaked. This time, it didn't happen. Unemployment peaked in Oct 2009 at 10.1% but confidence kept on sinking. The University of Michigan's index fell in early August to its lowest level since 1980. Thrown in is concern about the impact of the wild stock market on consumer spending. Indeed, equity volatility is having a negative impact on consumer psychology at a time of already weakening spending.

US growth revised down to 1pc in second quarter. Traders in the oil options pit of the New York Mercantile Exchange - the oil price slipped as US growth was revised down in the second quarter.
Traders in the oil options pit of the New York Mercantile Exchange – the oil price slipped as US growth was revised down in the second quarter. Photo: AP
Three main reasons underlie why the Fed made the recent commitment to keep short-term interest rates near zero through mid-2013: (i) cuts all round to US growth forecasts for 2H11 and 2012; (ii) drop in oil and commodity prices plus lower expectations on the pace of recovery led to growing confidence inflation will stabilise; and (iii) rise in downside risks to growth in the face of deep concern about Europe's ability to resolve its sovereign debt problems. The Fed's intention is at least to keep financial conditions easy for the next 18 months. Also, it helps to ensure the slowly growing economy would not lapse into recession, even though it's already too close to the line; any shock could knock it into negative territory.

The critical key

Productivity in the US has been weakening. In 2Q11, non-farm business labour productivity fell 0.3%, the second straight quarterly drop. It rose only 0.8% from 2Q10. Over the past year, hourly wages have risen faster than productivity. This keeps the labour market sluggish and threatens potential recovery. It also means an erosion of living standards over the long haul. But, these numbers overstate productivity growth because of four factors: (a) upward bias in the data - eg the US spends the most on health care per capita in the world, yet without superior outcomes; (b) government spending on military and domestic security have risen sharply, yet they don't deliver useful goods and services that raise living standards; (c) labour force participation has fallen for years. Taking lower-paying jobs out of the mix raises productivity but does not create higher value-added jobs; and (d) off-shoring by US companies to China for example, but they don't enhance American productivity. Overall, they just overstate productivity. So, the US, like Europe, needs to actually raise productivity at the ground level if they are to really grow and reduce debt over the long-term. The next wave of innovation will probably rely on the world's current pool of scientific leaders - most of whom is still US-based.



US deficit is too large

The US budget deficit is now 9.1% of GDP. That's high by any standard. According to the impartial US Congressional Budget Office (CBO), even after returning to full employment, the deficit will remain so large its debt to GDP will rise to 190% by 2035! What happened? This deficit was 3.2% in 2008; rose to 8.9% in 2010, pushing the debt/GDP ratio from 40% to 62% in 2010. This “5.7% of GDP” rise in the deficit came about because of (i) a fall of “2.6% of GDP” in revenue (from 17.5% to 14.9% of GDP), and (ii) a rise of “3.1% of GDP” in spending (from 20.7% to 23.8% of GDP). According to the CBO, less than one-half of the rise in deficit was caused by the downturn of 2008-2010. Because of this cyclical decline, revenue collections were lower and outlays, higher (due to higher unemployment benefits and transfers to help those adversely affected). They in turn raise total demand and thus, help to stabilise the economy. These are called “automatic stabilisers.” In addition, the budget deficit also worsened because, even at full-employment, revenues would still fall and spending rise. So, the great recession did its damage.

Looking ahead, the Obama administration's budget proposals would add (according to CBO) US$3.8 trillion to the national debt between 2010 and 2020. This would raise the debt/GDP ratio to 90% reflecting limited higher spending, weaker revenues from middle and lower income taxpayers, offset in part by higher taxes on the rich. Even so, these are based on conservative assumptions regarding military spending, no new programmes and lower discretionary spending in “real” terms. No doubt, actual fiscal consolidation would imply much more spending cuts and higher revenues. According to Harvard's Prof M. Feldstein, increased revenues can only come about, without raising marginal tax rates, through what he calls cuts in “tax expenditures,” that is, reforming tax deductions (eg cutting farm subsidies, eliminating deductions for ethanol production, etc). Such a “balanced approach” to resolve the growing fiscal deficit will be hard to come-by given the political paralysis in Washington. Worse, the poisonous politics of the past two months have created a new sort of uncertainty. The tea partiers' refusal to compromise can, at worse, kill off the recovery. The only institution with power to avert danger is the Fed. But printing money can be counter-productive. Fiscal measures are the preferred way to go at this time. Even so, the US fiscal problems will mount beyond 2020 because of the rising cost of social security and medicare benefits. No doubt, fundamental reform is still needed for the long-term health of the US economy.

Eurozone stumbles

Looming large as a risk factor is Europe's long running sovereign debt saga, which is pummelling US and European financial markets and business confidence. So far, Europe's woes and the market turmoil it stirred are worrisome. The S&P 500 fell close to 5% last week extending losses of 15.4% over the previous three weeks, its worse streak of that length in 2 years, and down 17.6% from its 2011 high. The situation in Europe has been dictating much of the global markets' recent movements. The eurozone's dominant service sector was effectively stagnant in August after two years of growth, while manufacturing activity, which drove much of the recovery in the bloc shrank for the first time since September 2009. Latest indicators add to signs the slowdown is spreading beyond the periphery and taking root in its core members, including Germany. The Flash Markit Eurozone Services Purchasing Managers' Index (PMI) fell to 51.5 in August (51.6 in July), its lowest level since September 2009. The PMI, which measures activity ranging from restaurants to banks, is still above “50”, the mark dividing growth from contraction. However, PMI for manufacturing slid to 49.7 the first sub-50 reading since September 2009. Both services and manufacturing are struggling.

Going forward, poor data show neither Germany nor France (together making- up one-half the bloc's GDP) is going to be the locomotive. Indeed, the risks of “pushing” the region over the edge are significant. Germany faces an obvious slowdown and a possible lengthy stagnation.

European financial markets just came off a turbulent two weeks, with investors fearing the debt crisis could spread further if Europe's policy makers fail to implement institutional change and new structural supports for the currency bloc's finances. In the interim, the ECB has been picking up Italian and Spanish bonds to keep borrowing costs from soaring. The action has worked so far, but the ECB is only buying time and can't support markets indefinitely. So far, the rescue bill included 365 billion euros in official loans to Greece, Portugal and Ireland; the creation of a 440 billion euros rescue fund; and 96 billion euros in bond buying by the ECB. Despite this, market volatility and uncertainty prevail. Europe is being forced into an end-game with three possible outcomes: (a) disorderly break-up - possible if the peripherals fail in their fiscal reform or can no longer withstand stagnation arising from austerity; (b) greater fiscal union in return for strict national fiscal discipline; and (c) creation of a more compact and more economically coherent eurozone against contagion; this implies some weaker members will take “sabbatical” from the euro. My own sense is that the end-game will be neither simple nor orderly. Politicians will likely opt for a weak variant of fiscal union. After more pain, a smaller and more robust euro could emerge and avoid the euro's demise. Nobel Laureate Paul Krugman gives a “50% chance Greece would leave and a 10% odds of Italy following.”

Leaderless world

The crisis we now face is one of confidence. Starting with the markets across both sides of the Atlantic and in Japan. This lack of confidence reflected an accumulation of discouraging news, including feeble economic data in the US and Europe, and signs European banks are not so stable. The global rout seems to have its roots in free-floating anxiety about US dysfunctional politics and about euroland's economic and financial stability. Confidence is indeed shaky, already spreading to businesses and consumers, raising risks any fresh shock could be enough to push the US and European economies into recession. Business optimism, at best, is “softish.” Consumers are still deleveraging. Unfortunately, this general lack of confidence in global economic prospects could become a self-fulfilling prophecy. In the end, it's all about politics. The French philosopher Blaise Pascal contends politics have incentives that economics cannot understand. To act, politicians need consensus, which often does not emerge until the costs of inaction become highly visible. By then, it is often too late to avoid a much worse outcome. So, the demand for global leadership has never been greater. But, none is forthcoming not for the US, not from Europe; certainly not from Germany and France, or Britain.

The world is adrift. Unfortunately, it will continue to drift in the coming months, even years. Voters on both sides of the Atlantic need to demand more from their leaders than “continued austerity on autopilot.” After all, in politics, leadership is the art of making the impossible possible.

Former banker, Dr Lin is a Harvard educated economist and a British Chartered Scientist who now spends time writing, teaching and promoting the public interest. Feedback is most welcome; email: starbizweek@thestar.com.my.