What emotivism asserts is in central part that there are and can be no valid rational justification for any claims that objective and impersonal moral standards exist and hence that there are no such standards. Its claim is of the same order as the claim that it is true of all cultures whatsoever that they lack witches. Purported witches there may be, but real witches there cannot have been, for there are none. So emotivism holds that purported rational justification there may be, but real rational justifications there cannot have been, for there are none.
Thursday, April 09, 2009
Morals and Witches
From Alasdair MacIntyre in After Virtue:
Monday, March 30, 2009
Economist Intelligence Unit: "30% Chance of Global Depression"
On March 20, 2009, the Economist Intelligence Unit—a fantastic source of information on the business climate in every country in the world—predicted a 30% chance for the world economy growing at less than 1% for the next fiver years, which would qualify as a depression.
Link to the press release.
Depression would be characterised by mass bankruptcies and job losses. In a vicious cycle of debt deflation, the burden of debt would rise in real terms as collateral declined in value and incomes fell. As bad debts piled up, banks' balance-sheets would be weakened, resulting in forced asset sales. These would drive down prices further. Like banks and financial institutions, households and companies would “deleverage”, disposing of assets at fire-sale prices to pay down debt.Alternative scenarios are not good either.Under this scenario, the major developed economies would grow by less than 1% on average over the next five years. Even when growth resumes, it would do so at levels too low to create jobs for a new generation of unemployed.
...there is a 60% chance that the stimulus operations now underway will restore stability by 2010/11, albeit at lower growth levels than we’ve been accustomed to.Though I've heard "May you live in interesting times" is not actually a Chinese curse, it would be a serious curse if it were.[...]
A third scenario, in which failing confidence in the US economy leads to mass withdrawal from dollar-denominated assets and a collapse in the US currency, carries a 10% probability.
Link to the press release.
US Pension Management Shifted into Stocks from Bonds Before Crash
When investing, a general guideline is that when everyone is doing something is definitely not the time to try it for the first time. Too bad the agency overseeing millions of Americans' pensions didn't go by this one.
Link.
Just months before the start of last year's stock market collapse, the federal agency that insures the retirement funds of 44 million Americans departed from its conservative investment strategy and decided to put much of its $64 billion insurance fund into stocks.
Link.
Tuesday, March 03, 2009
Sunday, February 15, 2009
U.S. Citizenship as an Army Recruiting Incentive
The U.S. is now in the business of trading citizenship for war-making.
The U.S. Army has announced that it will accept immigrants with temporary visas for the first time since the Vietnam War in an effort to fill critical capacity gaps. Immigrants will be offered fast-track U.S. citizenship in return for service.
That the Army "finds itself" fragmented is a sign of poor management by military leaders and insufficient oversight by citizens. The Army does not "find itself" in places, transported there mysteriously. If it is true that soldiers feel this way, then the inadequate rationale for war-making that has infected U.S. culture since the end of World War II continues. How is it that the Army cannot understand how it has gotten where it is? How is it that an Army Lieutenant-General suddenly discovers that the Army has become fragmented, as if he is Rip Van Winkle awaking beneath a tree after a long slumber?
Offering United States citizenship to immigrants in exchange for their services waging war is a reproachable strategy, indicative of a broken volunteer military and an American culture that no longer understands or agrees upon the reasons it takes violence across the globe.
Offering the "American dream" as an incentive at a time when hundreds of thousands of Americans are losing jobs, homes, and retirements shows just how desperate the Army has become. The lack of any public commentary or awareness of this new Army program shows just how ambivalent the U.S. citizenry—we—have become about managing ourselves and our country.
The U.S. Army has announced that it will accept immigrants with temporary visas for the first time since the Vietnam War in an effort to fill critical capacity gaps. Immigrants will be offered fast-track U.S. citizenship in return for service.
"The American army finds itself in a lot of different countries where cultural awareness is critical," said Lt-Gen Benjamin C Freakley, the top recruitment officer for the army.The fragmentation of the U.S. Army into many countries is a sign of what is commonly called overextension. Overextension simply means that the military is failing at what it is trying to do. If it were not failing, there would be no talk of overextension. Overextension is a euphemism.
"There will be some very talented folks in this group," he told the New York Times.
"The army will gain in its strength in human capital, and the immigrants will gain their citizenship and get on a ramp to the American dream."
That the Army "finds itself" fragmented is a sign of poor management by military leaders and insufficient oversight by citizens. The Army does not "find itself" in places, transported there mysteriously. If it is true that soldiers feel this way, then the inadequate rationale for war-making that has infected U.S. culture since the end of World War II continues. How is it that the Army cannot understand how it has gotten where it is? How is it that an Army Lieutenant-General suddenly discovers that the Army has become fragmented, as if he is Rip Van Winkle awaking beneath a tree after a long slumber?
Offering United States citizenship to immigrants in exchange for their services waging war is a reproachable strategy, indicative of a broken volunteer military and an American culture that no longer understands or agrees upon the reasons it takes violence across the globe.
Offering the "American dream" as an incentive at a time when hundreds of thousands of Americans are losing jobs, homes, and retirements shows just how desperate the Army has become. The lack of any public commentary or awareness of this new Army program shows just how ambivalent the U.S. citizenry—we—have become about managing ourselves and our country.
Thursday, February 05, 2009
The Regulation of Pants
I recently read the entire Leaf River Village Code. Okay, not all of it. I skipped some sections, like Title 3, Chapter 8: Fire Insurance Companies (abbreviated 3-8). But I did read others that I really should have skipped, such as 3-6: Raffles and 4-6: Explosives and Fireworks. How could I not read 4-6? I'm stuck inside and looking for divertimento.
When sequestered indoors in winter and reading your municipal code for laughs—in other words, when in my situation—the first place to look for amusement is not, paradoxically, 3-3: Amusements Generally. The real action is in...3-2: Liquor Control!
Judging by page counts in the LR Code, liquor is at best the most heavily-regulated activity in Leaf River and at worst tied for most regulated with 7-6: Sewer Use and Service, and that only due to the latter's abundance of definitions for things like Properly Shredded Garbage, Biochemical Oxygen Demand, Compatible Pollutant, Slug, Floatable Oil, Effluent Criteria, Useful Life, and Control Manhole (the last of which goes straight onto my list of potential gay bar names). Without those useful definitions, 3-2 wins by many, many pages, this even though it only defines two terms! Really, who needs to have liquor explained? Answer: far fewer people than need sewer use and service explained.
The LR Code sets out the law of the Village, similar to, but distinctly different from, the law of the Jungle. Law in general has been described in many ways, including "invisible forces in the air", "something people get paid too much for", and "that shit that no one understands or likes". The LR Code contains the law that the people of Leaf River have determined will guide and regulate their tiny piece of the world. Delightful things are in the LR Code. Delightful things are in 3-2: Liquor Control.
In Section 6 (3-2-6): Restrictions on Issuance of License, the citizens of Leaf River define who among them may not obtain a liquor license. Such persons include
3-2-6D: A person who is not a citizen of the United States.
3-2-6F: A person who has been convicted of being the keeper of a house of ill fame.
3-2-6G: A person who has been convicted of pandering or other crime or misdemeanor opposed to decency and morality.
3-2-6P: Any elected public official, law enforcing officer, the Village President or member of the Village Board of Trustees, Leaf River officer or employee or member of any Leaf River board or commission.
The citizens thus exclude from obtaining a liquor license both keepers of houses of ill fame as well as elected officials, panderers as well as the Village President. 3-2-6P protects against conflicts of interest. Determining what 3-2-6D protects the village from will require more analysis.
If you should be so lucky as to avoid inclusion in the exclusions of 3-2-6 and you successfully obtain a liquor license, your first step will likely be hiring employees to sell your liquor. Your second step will be deciding what those employees will wear, naturally. To do so, turn first to LR Code 3-2-16: Attire:
3-2-16A: Every licensee and every employee...shall be properly and decently attired during the course of the sale [and] distribution...of alcoholic liquors of every description.... Topless or similar costumes are prohibited.
Shirts? Check. But, you're probably asking, what about pants?
3-2-16B: It shall be unlawful for any licensee or employee...to: 1. Expose his or her genitals, pubic hair, buttocks, natal cleft, perineum, anal region or pubic hair region.
"Dang!" you may say. "How will I sell copious amounts of booze to people if unable to attract them to my bar with pantsless employees?" But, an idea occurs: "What if I have my employees wear devices, costumes and coverings that make them appear to be pantsless?! Yes! Yes, this is the answer!"
3-2-16B: It shall be unlawful for any licensee or employee...to: 2. Expose any device, costume or covering which gives the appearance of or simulates the genitals, pubic hair, buttocks, natal cleft, perineum, anal region or pubic hair region.
"Damn you LR Code!"
You have found, as I did, that the LR Code is always, if not two, at least one step ahead of prurience.
"But," you may stammer, "but what if my employees wear shirts with no fronts? Yes! Again, yes, the answer!"
3-2-16B: It shall be unlawful for any licensee or employee...to: 3. Expose any portion of the female breast at or below the areola thereof.
"No! This can't be! How, how will I sell booze?!" Well, good person, may I make a suggestion? Seeing as 3-2-16B.3 applies specifically to "the female breast", perhaps a male gay bar would be profitable? If you are interested, I have a list of potential bar names that I might be willing to sell you. Let us only hope that 3-2-16A intends the same discrimination toward females as 3-2-16B.
Lest you begin to think that the LR Code only concerns itself with persons of ill fame, it should also be noted that the Code also contains moments of civility by prohibiting anyone from selling liquor "to any person known by them to be an habitual drunkard, insane, mentally ill, mentally deficient or in need of mental treatment" (3-2-18), as well as to minors (3-2-19).
Beyond the regulation of alcohol, the LR Code offers many morsels of insight into the social mores of the LR community and the values of LR citizens. Consider the legal definition of VEHICLE as outlined in 4-5-1:
A machine propelled by power other than human power designed to travel along the ground by use of wheels, treads, runners or slides and transport persons or property or pull machinery and shall include, without limitation, the following: automobile, truck, trailer, motorcycle, tractor, buggy and wagon.
Consider also the legal definitions from 5-2-1 for ANIMAL:
Any and all types of animals, domesticated and wild, male and female, except man,
for CAT:
Any cat, male or female,
and for DOG:
Any dog, male or female.
Lest you begin to think that the Village of Leaf River consists only of marginally-drunken pet owners prone to inebriated buggying, know also that Leaf River citizens care for all of nature, including both noble plants like trees and ignoble plants like weeds. Diseased trees harboring Dutch Elm Disease or the breeding activities of the Elm Bark Beetle are defined as nuisances and are to be removed and burned within ten days of identification for the protection of healthy trees (4-4-1A, B).
The citizenry also knows its weeds, so well that it delineates between Noxious Weeds and mere Other Weeds (4-3-1A, B). Noxious Weeds are: Ragweed, giant and common; Canada thistles and all of its varieties; perennial sow thistle; European bind weed; hoary cress, leafy spurge, Russian knapweed. Other Weeds: Burdock, cocklebur, jimson, blue vervain, common milk weed, wild carrot, poison ivy, wild mustard, rough pigweed, lambsquarter, wild lettuce, curied ock, smart weeds (all varieties), poison hemlock, wild hemp, ox eye daisy, goldenrod, yellow hemlock, buckhorn or other weeds of like kind.
Who know that Leaf River harbored such a plant-menagerie? (If these plants were to be displayed in the Village as a kind of menagerie, the proprietor would have to obtain a license for the "exhibition of inanimate objects" costing $5.00 per day under 3-3-2, control for crowding under 3-3-4A, guard against the show becoming indecent under 3-3-4B, and prevent rioting and any other public disturbance under 3-3-4C, all common occurrences at exhibitions of inanimate objects.)
The LR Code is a fun read if you are predisposed to legal fascination and ruminations on the ability to hold up to 5 pounds of dynamite in one's residence (4-6-2A). The LR Code and other municipal codes reveal to a certain extent how citizens and elected officials think about acceptable and unacceptable activities for humans. These laws regulate how we all live and establish the circumstances under which the state can exercise violence against its citizens through fines, seizure of property, and even imprisonment.
In this way, the municipal code outlines the activities that negate a citizen's quotidian protections against state violence that are outlined in other documents, like the United States Constitution. It is rather remarkable that such an important, consequential line is drawn in nearly incomprehensible legal language. However, the legal language is the way it is because it attempts to do something impossible for the written word: avoid ambiguity.
The law is a system for settling disputes and tries to establish the rules for all parties such that the actions of all people can be equally judged. However, all parties do not interpret language the same way. As an extreme example, consider someone with no knowledge of English. What meaning would they glean from the US Constitution? Words contain no meaning but are instead imparted meaning by their reader. Ambiguity is the unavoidable result of leaving the meaning of words up to every individual who reads them.
Nevertheless, the LR Code defines what is and is not permissible in the Village, but, if challenged, the meaning of the words would be interpreted by the legal system, by lawyers, judges, and juries charged with the responsibility—and power—to decide what words mean and impart consequences on people based on those decisions. This is the basis of one of my greatest fears: to be charged with and punished for something that I do not consider a crime. What I think about it really doesn't matter because deciding if something is a crime is not an individual decision, it is a social decision. (Dostoevsky's book Crime and Punishment—and much of his other writing—explores this fight between individuals and society (often religion) to define right and wrong.) Social decisions often get very messy because society's mores change faster than the individual values making up the society. It is a rare elderly person who thinks kids are doing the right things. And as we all know from the parental cliché, not knowing something is wrong does not excuse you from being punished. How else are you to learn that it is wrong?
Incidentally, this is the same principle underlying one of my major pet peeves. Dog owners in LR rarely if ever discipline their pets that jump on me while walking or charge toward me, murder in their eyes. The dog gets a yell from its owner, and the dog probably gets as much meaning form that yell as it would if it tried to read the LR Village Code. I, however, get serious negative reinforcement to ever step out of my house. Which is fine because it's winter.
When sequestered indoors in winter and reading your municipal code for laughs—in other words, when in my situation—the first place to look for amusement is not, paradoxically, 3-3: Amusements Generally. The real action is in...3-2: Liquor Control!
Judging by page counts in the LR Code, liquor is at best the most heavily-regulated activity in Leaf River and at worst tied for most regulated with 7-6: Sewer Use and Service, and that only due to the latter's abundance of definitions for things like Properly Shredded Garbage, Biochemical Oxygen Demand, Compatible Pollutant, Slug, Floatable Oil, Effluent Criteria, Useful Life, and Control Manhole (the last of which goes straight onto my list of potential gay bar names). Without those useful definitions, 3-2 wins by many, many pages, this even though it only defines two terms! Really, who needs to have liquor explained? Answer: far fewer people than need sewer use and service explained.
The LR Code sets out the law of the Village, similar to, but distinctly different from, the law of the Jungle. Law in general has been described in many ways, including "invisible forces in the air", "something people get paid too much for", and "that shit that no one understands or likes". The LR Code contains the law that the people of Leaf River have determined will guide and regulate their tiny piece of the world. Delightful things are in the LR Code. Delightful things are in 3-2: Liquor Control.
In Section 6 (3-2-6): Restrictions on Issuance of License, the citizens of Leaf River define who among them may not obtain a liquor license. Such persons include
3-2-6D: A person who is not a citizen of the United States.
3-2-6F: A person who has been convicted of being the keeper of a house of ill fame.
3-2-6G: A person who has been convicted of pandering or other crime or misdemeanor opposed to decency and morality.
3-2-6P: Any elected public official, law enforcing officer, the Village President or member of the Village Board of Trustees, Leaf River officer or employee or member of any Leaf River board or commission.
The citizens thus exclude from obtaining a liquor license both keepers of houses of ill fame as well as elected officials, panderers as well as the Village President. 3-2-6P protects against conflicts of interest. Determining what 3-2-6D protects the village from will require more analysis.
If you should be so lucky as to avoid inclusion in the exclusions of 3-2-6 and you successfully obtain a liquor license, your first step will likely be hiring employees to sell your liquor. Your second step will be deciding what those employees will wear, naturally. To do so, turn first to LR Code 3-2-16: Attire:
3-2-16A: Every licensee and every employee...shall be properly and decently attired during the course of the sale [and] distribution...of alcoholic liquors of every description.... Topless or similar costumes are prohibited.
Shirts? Check. But, you're probably asking, what about pants?
3-2-16B: It shall be unlawful for any licensee or employee...to: 1. Expose his or her genitals, pubic hair, buttocks, natal cleft, perineum, anal region or pubic hair region.
"Dang!" you may say. "How will I sell copious amounts of booze to people if unable to attract them to my bar with pantsless employees?" But, an idea occurs: "What if I have my employees wear devices, costumes and coverings that make them appear to be pantsless?! Yes! Yes, this is the answer!"
3-2-16B: It shall be unlawful for any licensee or employee...to: 2. Expose any device, costume or covering which gives the appearance of or simulates the genitals, pubic hair, buttocks, natal cleft, perineum, anal region or pubic hair region.
"Damn you LR Code!"
You have found, as I did, that the LR Code is always, if not two, at least one step ahead of prurience.
"But," you may stammer, "but what if my employees wear shirts with no fronts? Yes! Again, yes, the answer!"
3-2-16B: It shall be unlawful for any licensee or employee...to: 3. Expose any portion of the female breast at or below the areola thereof.
"No! This can't be! How, how will I sell booze?!" Well, good person, may I make a suggestion? Seeing as 3-2-16B.3 applies specifically to "the female breast", perhaps a male gay bar would be profitable? If you are interested, I have a list of potential bar names that I might be willing to sell you. Let us only hope that 3-2-16A intends the same discrimination toward females as 3-2-16B.
Lest you begin to think that the LR Code only concerns itself with persons of ill fame, it should also be noted that the Code also contains moments of civility by prohibiting anyone from selling liquor "to any person known by them to be an habitual drunkard, insane, mentally ill, mentally deficient or in need of mental treatment" (3-2-18), as well as to minors (3-2-19).
Beyond the regulation of alcohol, the LR Code offers many morsels of insight into the social mores of the LR community and the values of LR citizens. Consider the legal definition of VEHICLE as outlined in 4-5-1:
A machine propelled by power other than human power designed to travel along the ground by use of wheels, treads, runners or slides and transport persons or property or pull machinery and shall include, without limitation, the following: automobile, truck, trailer, motorcycle, tractor, buggy and wagon.
Consider also the legal definitions from 5-2-1 for ANIMAL:
Any and all types of animals, domesticated and wild, male and female, except man,
for CAT:
Any cat, male or female,
and for DOG:
Any dog, male or female.
Lest you begin to think that the Village of Leaf River consists only of marginally-drunken pet owners prone to inebriated buggying, know also that Leaf River citizens care for all of nature, including both noble plants like trees and ignoble plants like weeds. Diseased trees harboring Dutch Elm Disease or the breeding activities of the Elm Bark Beetle are defined as nuisances and are to be removed and burned within ten days of identification for the protection of healthy trees (4-4-1A, B).
The citizenry also knows its weeds, so well that it delineates between Noxious Weeds and mere Other Weeds (4-3-1A, B). Noxious Weeds are: Ragweed, giant and common; Canada thistles and all of its varieties; perennial sow thistle; European bind weed; hoary cress, leafy spurge, Russian knapweed. Other Weeds: Burdock, cocklebur, jimson, blue vervain, common milk weed, wild carrot, poison ivy, wild mustard, rough pigweed, lambsquarter, wild lettuce, curied ock, smart weeds (all varieties), poison hemlock, wild hemp, ox eye daisy, goldenrod, yellow hemlock, buckhorn or other weeds of like kind.
Who know that Leaf River harbored such a plant-menagerie? (If these plants were to be displayed in the Village as a kind of menagerie, the proprietor would have to obtain a license for the "exhibition of inanimate objects" costing $5.00 per day under 3-3-2, control for crowding under 3-3-4A, guard against the show becoming indecent under 3-3-4B, and prevent rioting and any other public disturbance under 3-3-4C, all common occurrences at exhibitions of inanimate objects.)
The LR Code is a fun read if you are predisposed to legal fascination and ruminations on the ability to hold up to 5 pounds of dynamite in one's residence (4-6-2A). The LR Code and other municipal codes reveal to a certain extent how citizens and elected officials think about acceptable and unacceptable activities for humans. These laws regulate how we all live and establish the circumstances under which the state can exercise violence against its citizens through fines, seizure of property, and even imprisonment.
In this way, the municipal code outlines the activities that negate a citizen's quotidian protections against state violence that are outlined in other documents, like the United States Constitution. It is rather remarkable that such an important, consequential line is drawn in nearly incomprehensible legal language. However, the legal language is the way it is because it attempts to do something impossible for the written word: avoid ambiguity.
The law is a system for settling disputes and tries to establish the rules for all parties such that the actions of all people can be equally judged. However, all parties do not interpret language the same way. As an extreme example, consider someone with no knowledge of English. What meaning would they glean from the US Constitution? Words contain no meaning but are instead imparted meaning by their reader. Ambiguity is the unavoidable result of leaving the meaning of words up to every individual who reads them.
Nevertheless, the LR Code defines what is and is not permissible in the Village, but, if challenged, the meaning of the words would be interpreted by the legal system, by lawyers, judges, and juries charged with the responsibility—and power—to decide what words mean and impart consequences on people based on those decisions. This is the basis of one of my greatest fears: to be charged with and punished for something that I do not consider a crime. What I think about it really doesn't matter because deciding if something is a crime is not an individual decision, it is a social decision. (Dostoevsky's book Crime and Punishment—and much of his other writing—explores this fight between individuals and society (often religion) to define right and wrong.) Social decisions often get very messy because society's mores change faster than the individual values making up the society. It is a rare elderly person who thinks kids are doing the right things. And as we all know from the parental cliché, not knowing something is wrong does not excuse you from being punished. How else are you to learn that it is wrong?
Incidentally, this is the same principle underlying one of my major pet peeves. Dog owners in LR rarely if ever discipline their pets that jump on me while walking or charge toward me, murder in their eyes. The dog gets a yell from its owner, and the dog probably gets as much meaning form that yell as it would if it tried to read the LR Village Code. I, however, get serious negative reinforcement to ever step out of my house. Which is fine because it's winter.
Wednesday, February 04, 2009
Multi-national agriculture, drive by water.
Saudi Arabia, China, and South Korea are all leasing or buying land in other countries on which to grow food. Water demands for agriculture have overwhelmed the water each country has access to domestically, forcing them to look elsewhere.
When a country devotes 40% of its renewable water resources or more to irrigation, it starts to face these water allocation issues.Story from the BBC, which has had several great water stories today!
By 2030, under business as usual, all of South Asia will reach the 40% threshold; the Middle East and North Africa region will have hit 58%.
Agriculture almost always loses out to the industrialising economy, especially to the energy and manufacturing sectors, in such water allocation decisions.
Current trends suggest that by 2030, demand for extra water will soar.
Rapidly industrialising economies across South Asia, the Middle East and North Africa, which support approximately 2.5 billion people, will be forced to look elsewhere for water-rich land for their food.
How much water is in your blue jeans?
A fascinating article from BBC on Unilever's efforts to reduce the water used in their products includes these choice quotes:
The point of Unilevers water-use reduction? Profit, of course:
The most exciting thing offered by this story is an interactive graphic that shows how much water is involved in the production of some common goods. The graphic might make me drink much less coffee. See it and the story here: http://news.bbc.co.uk/2/hi/business/7785479.stm
"For far too long, businesses like ours have been effectively shipping water around the globe," says Gavin Neath, a spokesperson for Unilever.
"In the past, especially in the US, big was always best," explains Mr Rutherford.
"And the more bubbles and foam the better."
The point of Unilevers water-use reduction? Profit, of course:
Smaller bottles mean less packaging, meaning fewer carbon emissions.
"It also means more can be transported on fewer lorries which reduces fuel, which in turn lowers emissions.
"And making a more concentrated liquid means more goes further, so customers don't have to lug as much detergent from the supermarket as often."
The most exciting thing offered by this story is an interactive graphic that shows how much water is involved in the production of some common goods. The graphic might make me drink much less coffee. See it and the story here: http://news.bbc.co.uk/2/hi/business/7785479.stm
Tuesday, January 27, 2009
Melamine, China, and Expecting to Be Poor
China has sentenced Geng Jinping and Zhang Yujun to death and Tian Wenhua to life for their roles in the melamine-tainted milk deaths of six babies and the sickening of at least 300,000 others. Geng used melamine, a toxic industrial chemical, to fool regulators by increasing the protein content of watered-down milk. Zhang ran a workshop producing melamine-tainted powder sold as a protein enrichment. Tian was a dairy boss who for months delayed notifying regulators that her company's products, including baby formula, contained melamine.
Reporting for the AP, Anita Chang writes that deficient official oversight contributes to chronic food quality and safety problems in China. (Various versions of Chang's story were picked up. One is here http://agweekly.com/articles/2009/01/22/commodities/dairy/dairy28.txt, another here http://news.yahoo.com/s/ap/20090122/ap_on_re_as/as_china_tainted_milk/print). Chang contrasts the Chinese system in which milk comes from a "patchwork of producers" with the United States dairy industry in which "dairies run farms with thousands of cows and are better able to control quality." This comparison implies that Chinese food quality and safety could be improved with better official oversight, and that centralizing producers would make official oversight easier. Whether or not centralization is necessarily a good idea will be the main point of discussion herein.
In a very basic analysis of the situation, there are two ways to improve official oversight. The first is to change the production system to better fit the existing oversight system. The second is to change the oversight system to better fit the existing production system. Chang implies that, in China, the system of production, the patchwork of producers, should be changed to better fit the existing oversight system. These two systems can be thought of as either centralized or distributed. Chang characterizes the existing Chinese dairy production system as decentralized and the oversight system as centralized and implies that the production system should be centralized.
Two consequences of greater centralization will be discussed. The first are the political impacts of increasing the size and importance of primary producers. The second is the impact on the supply stream. Centralization has political consequences in terms of the power relationships between industry and government. Centralization makes producers more politically powerful by increasing their importance to the food production system and their wealth. Increased importance leads to an obligation of government to avoid infringing on the operations of firms deemed "too big to fail", embodied in the notion that "owing the bank $100 is your problem; owing the bank $100,000,000 is the bank's problem." If the closure of a dairy producer would disrupt the supply chain and consumption of dairy products, that becomes the government's problem, and that producer has a strong bargaining position. Reducing the number of producers also promotes monopoly power. The increased wealth from the monopoly power can be used for lobbying, soliciting government for preferential treatment. In these ways, centralized production can actually weaken the efficacy of government.
The second issue of greater centralization addressed here is the impact on the supply stream. Centralized production means that a relatively small number of producers are responsible for the bulk of production. This amplifies the supply-stream impacts of a problem at one producer. If one producer has a problem with quality or safety, its impact will be felt by many consumers due to the large amount of product coming from that producer. In a distributed production system, each producer contributes a small part of the supply stream, so amplification would not have as large an impact. Amplification is a significant drawback to centralized production and has shown up in some recent US food scares in centralized industries, e.g. salmonella on tomatoes and E. coli on spinach, in which problems at a small number of large producers resulted in widespread contamination.
But this begs the question of why the melamine contamination became such a large problem in China. After all, Chang says China's dairies are a "patchwork of producers", presumably distributed. If a distributed production system dampens the impact of amplification, how then did the melamine contamination in China come to be a national problem and sicken hundreds of thousands of babies? The answer to this question requires examining where melamine entered the Chinese dairy production process.
Investigations into the incident found that middlemen between milk producers and dairy companies were primarily responsible for the melamine contamination. These middlemen watered down raw milk and then added melamine to artificially increase its protein content. A low protein content would have tipped regulators that the middlemen were watering down the raw milk. Melamine was not being added by producers of the raw milk, presumably what Chang would refer to as the producers in the "patchwork of producers", but instead by consolidators of the raw milk. The point at which melamine was added was therefore a point of centralization in the production process and served to amplify the effect of the contamination. Chang's representation of the Chinese dairy production system as a "patchwork of producers" is somewhat misleading. The "patchwork of producers" of raw milk was not where the melamine problem occurred.
If this is true, how would increasing the size of individual producers, as Chang suggests is what safeguards the US system, guard against an incident like the melamine contamination? Here a subtle distinction in Chang's article must be noted: Chang attributes US quality and safety to the dairies themselves rather than to official oversight. Again, Chang writes that in the US "dairies run farms with thousands of cows and are better able to control quality." Here Chang minimizes the importance of oversight in the US dairy system, saying instead that the dairies themselves are controlling quality. But, as found in the Chinese melamine investigation, it was not the dairies that were responsible for the contamination. It was people and firms located at points of centralization between primary producers—the dairies—and end-product producers. The producers of raw milk had no incentive to add melamine to their product, because the only reason to do so was to hide from regulators that milk had been thinned. So how, then, would increasing the size of the dairies in China prevent another melamine incident or one like it?
Increasing the size of individual producers could reduce the middlemen involved in the production process and eliminate a point of entry for contamination. In the Chinese example, middlemen consolidated raw milk from multiple small producers in order to gather a large enough volume to sell on to other firms like baby formula producers, firms that need large amounts of milk on a daily basis. Middlemen had an incentive to use melamine that primary producers did not. If raw milk producers were capable of providing large amounts of milk to firms directly, the need for middlemen may be reduced. Official oversight of the producers could then be feasible. But notice how this does not make official oversight any different. Rather, it is the reduction in middlemen, the reduction of the number of people and firms involved in the production process, that would make official oversight possible. This is an example of changing the production system to fit the existing oversight system.
In China, centralization and control are central components of government, while in the US government is more distributed across states and also fragmented internally into branches. Chang's argument that centralized production would enable better official oversight in China is valid when it is evaluated from a perspective resting on the assumption that the production system should be changed to increase the efficiency of the existing oversight system. If Chang's argument is approached with different assumptions, such as that centralized production should be avoided or that government itself should be changed rather than only the production system, it appears weaker.
China's mode of government and of development is oriented toward centralization, be it with population growth—a great migration from rural to urban areas—or power production—the construction of the Three Gorges Dam that will provide about 3% of the country's electricity. China will choose to centralize production to fit better with centralized government before it will decentralize government to fit a distributed production system.
In other contexts, decentralized government regulation of distributed production may be more politically acceptable. The advantages of a distributed production system arise from the system's inherent redundancy, yet this redundancy is antithetic to a mode of government regulation that rewards economies of scale. Economies of scale refer to the advantages that producers can gain when they increase in size. The most important competitive advantage gained from economies of scale is the ability to sell products more cheaply than smaller competitors. Economies of scale only work in certain regulatory and business frameworks. In capitalism, the system employed in both the US and China, economies of scale are very rewarding, and most firms strive to achieve them. However, economies of scale can also lead to monopolies when one firm becomes so large and its pricing so powerful that it drives all competitors out of business. This situation develops in capitalism absent of regulation and led to a crisis in the US in the early 20th century. This crisis resulted in the creation of anti-trust (anti-monopoly) laws that limited the extent to which firms could harness economies of scale to shut down all competitors.
In the past half-century, China has undergone massive centralization. Millions of people have been removed from agricultural livelihoods and centralized into cities; the Yangtze River has been diverted for the past decade as the Three Gorges Dam—the world's largest—is constructed; and censors block information from flowing into and out of the country. Centralizing the country's dairy industry fits into this framework and will almost certainly be pursued. The government likely will not miss the opportunity provided by the melamine scandal to eliminate an entire level of middlemen.
However, there is danger in this path. Centralization increases the efficiency of production in part by reducing the number of employees. This reduces jobs. China has a large population that has been removed from labor-intensive agricultural work and must now be supported by industrial and service jobs, and the existence of these jobs requires continued, constant growth in consumption of goods and services. The era of centralization in the US in the early 20th century led to a tremendous over-capacity to produce goods, which in turn contributed to the Great Depression when there simply was not enough demand to satisfy the productive power of world industry. Reviving demand required more than 10 years as well as a World War. Also of concern is the timing of China's growth with the world economic crisis. The US unemployment rate is now expected to approach if not exceed 10%. The population of China is more than 1 billion people. Ten percent unemployment in a country that large could mean 100 million people unemployed. The vast majority of these people would be living in newly-created cities and would have memories of agricultural life that had been taken from them, agricultural life where their purpose made sense and where they could provide for their basic needs with their own labor. This is not to paint a romanticized vision of Chinese agricultural peasantry. That life likely was and still is hard work that destroys the body. But it is not hard to imagine dissatisfaction growing in these people with the promises of their government for a better life in the city falling flat.
The melamine contamination is an interesting starting point for thought and discussion on the impact of centralization and on the correct balance between centralization and distribution in production systems, as well as the role of government in all of this. Contrasting the Chinese and US cases can provide insight, but is also rife with pitfalls as overgeneralization and conjecture abound. However, the present economic crisis may mark the endpoint of one of the great periods of centralization. Entire generations of people around the globe only know economies that grow at extraordinary rates, only know societal change that advances with great speed, and fully expect their own lives to mirror the change and increase in affluence that older generations went through. The realization that these expectations will be unfulfilled may lead to social problems so bad that they make an economic crisis ten times worse than the present one seem preferable.
Reporting for the AP, Anita Chang writes that deficient official oversight contributes to chronic food quality and safety problems in China. (Various versions of Chang's story were picked up. One is here http://agweekly.com/articles/2009/01/22/commodities/dairy/dairy28.txt, another here http://news.yahoo.com/s/ap/20090122/ap_on_re_as/as_china_tainted_milk/print). Chang contrasts the Chinese system in which milk comes from a "patchwork of producers" with the United States dairy industry in which "dairies run farms with thousands of cows and are better able to control quality." This comparison implies that Chinese food quality and safety could be improved with better official oversight, and that centralizing producers would make official oversight easier. Whether or not centralization is necessarily a good idea will be the main point of discussion herein.
In a very basic analysis of the situation, there are two ways to improve official oversight. The first is to change the production system to better fit the existing oversight system. The second is to change the oversight system to better fit the existing production system. Chang implies that, in China, the system of production, the patchwork of producers, should be changed to better fit the existing oversight system. These two systems can be thought of as either centralized or distributed. Chang characterizes the existing Chinese dairy production system as decentralized and the oversight system as centralized and implies that the production system should be centralized.
Two consequences of greater centralization will be discussed. The first are the political impacts of increasing the size and importance of primary producers. The second is the impact on the supply stream. Centralization has political consequences in terms of the power relationships between industry and government. Centralization makes producers more politically powerful by increasing their importance to the food production system and their wealth. Increased importance leads to an obligation of government to avoid infringing on the operations of firms deemed "too big to fail", embodied in the notion that "owing the bank $100 is your problem; owing the bank $100,000,000 is the bank's problem." If the closure of a dairy producer would disrupt the supply chain and consumption of dairy products, that becomes the government's problem, and that producer has a strong bargaining position. Reducing the number of producers also promotes monopoly power. The increased wealth from the monopoly power can be used for lobbying, soliciting government for preferential treatment. In these ways, centralized production can actually weaken the efficacy of government.
The second issue of greater centralization addressed here is the impact on the supply stream. Centralized production means that a relatively small number of producers are responsible for the bulk of production. This amplifies the supply-stream impacts of a problem at one producer. If one producer has a problem with quality or safety, its impact will be felt by many consumers due to the large amount of product coming from that producer. In a distributed production system, each producer contributes a small part of the supply stream, so amplification would not have as large an impact. Amplification is a significant drawback to centralized production and has shown up in some recent US food scares in centralized industries, e.g. salmonella on tomatoes and E. coli on spinach, in which problems at a small number of large producers resulted in widespread contamination.
But this begs the question of why the melamine contamination became such a large problem in China. After all, Chang says China's dairies are a "patchwork of producers", presumably distributed. If a distributed production system dampens the impact of amplification, how then did the melamine contamination in China come to be a national problem and sicken hundreds of thousands of babies? The answer to this question requires examining where melamine entered the Chinese dairy production process.
Investigations into the incident found that middlemen between milk producers and dairy companies were primarily responsible for the melamine contamination. These middlemen watered down raw milk and then added melamine to artificially increase its protein content. A low protein content would have tipped regulators that the middlemen were watering down the raw milk. Melamine was not being added by producers of the raw milk, presumably what Chang would refer to as the producers in the "patchwork of producers", but instead by consolidators of the raw milk. The point at which melamine was added was therefore a point of centralization in the production process and served to amplify the effect of the contamination. Chang's representation of the Chinese dairy production system as a "patchwork of producers" is somewhat misleading. The "patchwork of producers" of raw milk was not where the melamine problem occurred.
If this is true, how would increasing the size of individual producers, as Chang suggests is what safeguards the US system, guard against an incident like the melamine contamination? Here a subtle distinction in Chang's article must be noted: Chang attributes US quality and safety to the dairies themselves rather than to official oversight. Again, Chang writes that in the US "dairies run farms with thousands of cows and are better able to control quality." Here Chang minimizes the importance of oversight in the US dairy system, saying instead that the dairies themselves are controlling quality. But, as found in the Chinese melamine investigation, it was not the dairies that were responsible for the contamination. It was people and firms located at points of centralization between primary producers—the dairies—and end-product producers. The producers of raw milk had no incentive to add melamine to their product, because the only reason to do so was to hide from regulators that milk had been thinned. So how, then, would increasing the size of the dairies in China prevent another melamine incident or one like it?
Increasing the size of individual producers could reduce the middlemen involved in the production process and eliminate a point of entry for contamination. In the Chinese example, middlemen consolidated raw milk from multiple small producers in order to gather a large enough volume to sell on to other firms like baby formula producers, firms that need large amounts of milk on a daily basis. Middlemen had an incentive to use melamine that primary producers did not. If raw milk producers were capable of providing large amounts of milk to firms directly, the need for middlemen may be reduced. Official oversight of the producers could then be feasible. But notice how this does not make official oversight any different. Rather, it is the reduction in middlemen, the reduction of the number of people and firms involved in the production process, that would make official oversight possible. This is an example of changing the production system to fit the existing oversight system.
In China, centralization and control are central components of government, while in the US government is more distributed across states and also fragmented internally into branches. Chang's argument that centralized production would enable better official oversight in China is valid when it is evaluated from a perspective resting on the assumption that the production system should be changed to increase the efficiency of the existing oversight system. If Chang's argument is approached with different assumptions, such as that centralized production should be avoided or that government itself should be changed rather than only the production system, it appears weaker.
China's mode of government and of development is oriented toward centralization, be it with population growth—a great migration from rural to urban areas—or power production—the construction of the Three Gorges Dam that will provide about 3% of the country's electricity. China will choose to centralize production to fit better with centralized government before it will decentralize government to fit a distributed production system.
In other contexts, decentralized government regulation of distributed production may be more politically acceptable. The advantages of a distributed production system arise from the system's inherent redundancy, yet this redundancy is antithetic to a mode of government regulation that rewards economies of scale. Economies of scale refer to the advantages that producers can gain when they increase in size. The most important competitive advantage gained from economies of scale is the ability to sell products more cheaply than smaller competitors. Economies of scale only work in certain regulatory and business frameworks. In capitalism, the system employed in both the US and China, economies of scale are very rewarding, and most firms strive to achieve them. However, economies of scale can also lead to monopolies when one firm becomes so large and its pricing so powerful that it drives all competitors out of business. This situation develops in capitalism absent of regulation and led to a crisis in the US in the early 20th century. This crisis resulted in the creation of anti-trust (anti-monopoly) laws that limited the extent to which firms could harness economies of scale to shut down all competitors.
In the past half-century, China has undergone massive centralization. Millions of people have been removed from agricultural livelihoods and centralized into cities; the Yangtze River has been diverted for the past decade as the Three Gorges Dam—the world's largest—is constructed; and censors block information from flowing into and out of the country. Centralizing the country's dairy industry fits into this framework and will almost certainly be pursued. The government likely will not miss the opportunity provided by the melamine scandal to eliminate an entire level of middlemen.
However, there is danger in this path. Centralization increases the efficiency of production in part by reducing the number of employees. This reduces jobs. China has a large population that has been removed from labor-intensive agricultural work and must now be supported by industrial and service jobs, and the existence of these jobs requires continued, constant growth in consumption of goods and services. The era of centralization in the US in the early 20th century led to a tremendous over-capacity to produce goods, which in turn contributed to the Great Depression when there simply was not enough demand to satisfy the productive power of world industry. Reviving demand required more than 10 years as well as a World War. Also of concern is the timing of China's growth with the world economic crisis. The US unemployment rate is now expected to approach if not exceed 10%. The population of China is more than 1 billion people. Ten percent unemployment in a country that large could mean 100 million people unemployed. The vast majority of these people would be living in newly-created cities and would have memories of agricultural life that had been taken from them, agricultural life where their purpose made sense and where they could provide for their basic needs with their own labor. This is not to paint a romanticized vision of Chinese agricultural peasantry. That life likely was and still is hard work that destroys the body. But it is not hard to imagine dissatisfaction growing in these people with the promises of their government for a better life in the city falling flat.
The melamine contamination is an interesting starting point for thought and discussion on the impact of centralization and on the correct balance between centralization and distribution in production systems, as well as the role of government in all of this. Contrasting the Chinese and US cases can provide insight, but is also rife with pitfalls as overgeneralization and conjecture abound. However, the present economic crisis may mark the endpoint of one of the great periods of centralization. Entire generations of people around the globe only know economies that grow at extraordinary rates, only know societal change that advances with great speed, and fully expect their own lives to mirror the change and increase in affluence that older generations went through. The realization that these expectations will be unfulfilled may lead to social problems so bad that they make an economic crisis ten times worse than the present one seem preferable.
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