Economics – Page 98 – artdiamondblog.com

For Right to Rise, French Youth Must Leave France’s “Decrepit, Overcentralized Gerontocracy”

(p. 4) The French aren’t used to the idea that their country, like so many others in Europe, might be one of emigration — that people might actually want to leave. To many French people, it’s a completely foreign notion that, around the world and throughout history, voting with one’s feet has been the most widely available means to vote at all.
. . .
When the journalist Mouloud Achour, the rapper Mokless and I published a column in the French daily Libération last September, arguing that France was a decrepit, overcentralized gerontocracy and that French youths should pack their bags and go find better opportunities elsewhere in the world, it caused an uproar.
. . .
It was a divide between those who have found their place in the system and believe fervently in defending the status quo, and those who are aware that a country that has tolerated a youth unemployment rate of 25 percent for nearly 30 years isn’t a place where the rising generations can expect to rise to much of anything.

For the full commentary, see:
FELIX MARQUARDT. “OPINION; The Best Hope for France’s Young? Get Out.” The New York Times, SundayReview Section (Sun., June 30, 2013): 4.
(Note: ellipses added.)
(Note: the online version of the commentary is dated June 29, 2013.)

Falling Computer Prices Cured the “Digital Divide”

(p. 304) The more evident the power of the internet as an uplifting force became, the more evident the divide between the digital haves and have-nots. One sociological study concluded that there were “two Americas” emerging. The citizens of one America were poor people who could not afford a computer, and of the other, wealthy individuals equipped with PCs who reaped all the benefits. During the 1990s, when technology boosters like me were promoting the advent of the internet, we were often asked: What are we going to do about the digital divide? My an-(p. 305)swer was simple: nothing. We didn’t have to do anything, because the natural history of a technology such as the internet was self-fulfilling. The have-nots were a temporary imbalance that would be cured (and more) by technological forces. There was so much profit to be made connecting up the rest of the world, and the unconnected were so eager to join, that they were already paying higher telecom rates (when they could get such service) than the haves. Furthermore, the costs of both computers and connectivity were dropping by the month. At that time most poor in America owned televisions and had monthly cable bills. Owning a computer and having internet access was no more expensive and would soon be cheaper than TV. In a decade, the necessary outlay would become just a $100 laptop. Within the lifetimes of all born in the last decade, computers of some sort (connectors, really) will cost $5.

Source:
Kelly, Kevin. What Technology Wants. New York: Viking Adult, 2010.

Children of Chinese Entrepreneurs Want to Work for Government

“Engineering student Xie Chaobo has yet to land a job.” Source of caption and photo: online version of the WSJ article quoted and cited below.

(p. A1) BEIJING–Xie Chaobo figures he has the credentials to land a job at one of China’s big state-owned firms. He is a graduate student at Tsinghua University, one of China’s best. His field of study is environmental engineering, one of China’s priorities. And he is experimenting with new techniques for identifying water pollutants, which should make him a valuable catch.
But he has applied to 30 companies so far and scored just four interviews, none of which has led to a job.
Although Mr. Xie’s parents are entrepreneurs who have built companies that make glasses, shoes and now water pumps, he has no interest in working at a private startup. Chinese students “have been told since we were children to focus on stability instead of risk,” the 24-year-old engineering student says.
Over the past decade, the number of new graduates from Chinese universities has increased sixfold to more than six million a year, creating an epic glut that is depressing wages, (p. A10) leaving many recent college graduates without jobs and making students fearful about their future. Two-thirds of Chinese graduates say they want to work either in the government or big state-owned firms, which are seen as recession-proof, rather than at the private companies that have powered China’s remarkable economic climb, surveys indicate. Few college students today, according to the surveys, are ready to leave the safe shores of government work and “jump into the sea,” as the Chinese expression goes, to join startups or go into business for themselves, although many of their parents did just that in the 1990s.

For the full story, see:
MIKE RAMSEY and VALERIE BAUERLEIN. “Tesla Clashes With Car Dealers; Electric-Vehicle Maker Wants to Sell Directly to Consumers; Critics Say Plan Violates Franchise Laws.” The Wall Street Journal (Tues., June 18, 2013): B1-B2.

Source of table: online version of the WSJ article quoted and cited above.

Laws to Protect Car Dealers, Keep Car Prices High

“Tesla ‘galleries’ such as this one in McLean, Va., can show but not sell cars.” Source of caption and photo: online version of the WSJ article quoted and cited below.

(p. B1) RALEIGH, N.C.–Elon Musk made a fortune disrupting the status quo in online shopping and renewable energy. Now he’s up against his toughest challenge yet: local car dealers.

Mr. Musk, the billionaire behind PayPal and now Tesla Motors Inc., wants to sell his $70,000 Tesla electric luxury vehicles directly to consumers, bypassing franchised automobile dealers. Dealers are flexing their considerable muscle in states including Texas and Virginia to stop him.
The latest battleground is North Carolina, where the Republican-controlled state Senate last month unanimously approved a measure that would block Tesla from selling online, its only sales outlet here. Tesla has staged whiz-bang test drives for legislators in front of the State House and hired one of the state’s most influential lobbyists to stave off a similar vote in the House before the legislative session ends in early July.
The focus of the power struggle between Mr. Musk and auto dealers is a thicket of state franchise laws, many of which go back to the auto industry’s earliest days when industry pioneer Henry Ford began turning to eager entrepreneurs to help sell his Model T.
Dealers say laws passed over the decades to prevent car makers from selling directly to consumers are justified because without them auto makers could use their economic clout to sell vehicles for less than their independent franchisees.

Great-Grandson of Cornelius Vanderbilt Privately Built First Highway Dedicated to Cars

Source of book image: https://lihj.cc.stonybrook.edu/wp-content/uploads/2011/07/Motor-Parkway_review.jpg

(p. 13) It survives only as segments of other highways, as a right of way for power lines and as a bike trail, but the Long Island Motor Parkway still holds a sense of magic as what some historians say is the country’s first road built specifically for the automobile. It opened 100 years ago last Friday as a rich man’s dream.

As detailed in a new book, “The Long Island Motor Parkway” by Howard Kroplick and Al Velocci (Arcadia Publishing), the parkway ran about 45 miles across Long Island, from Queens to Ronkonkoma, and was created by William Kissam Vanderbilt II, the great-grandson of Cornelius Vanderbilt.

. . .

The younger Vanderbilt was a car enthusiast who loved to race. He had set a speed record of 92 miles an hour in 1904, the same year he created his own race, the Vanderbilt Cup.
But his race came under fire after a spectator was killed in 1906, and Vanderbilt wanted a safe road on which to hold the race and on which other car lovers could hurl their new machines free of the dust common on roads made for horses. The parkway would also be free of “interference from the authorities,” he said in a speech.
So he created a toll road for high-speed automobile travel. It was built of reinforced concrete, had banked turns, guard rails and, by building bridges, he eliminated intersections that would slow a driver down. The Long Island Motor Parkway officially opened on Oct. 10, 1908, and closed in 1938.
. . .
But by the end of Vanderbilt’s life (he died in 1944), the public had come to feel entitled to car ownership. And there was growing pressure for public highways, like the parkways that the urban planner Robert Moses was building.

. . .

In 1938, Moses refused Vanderbilt’s appeal to incorporate the motor parkway into his new parkway system. The motor parkway just could not compete with the public roads, even after the toll was reduced to 40 cents, and Moses eventually gained control of Vanderbilt’s pioneering road for back taxes of about $80,000. The day of public roads had come, supplanting private highways.
. . .
The parkway marked the beginning of a process: the road was designed for the car. But in offering higher speeds, the parkway and other modern roads would push cars to their technical limits and beyond, inspiring innovation. In that sense, the first modern automobile highway helped to create the modern automobile.

For the full story, see:
PHIL PATTON. “A 100-Year-Old Dream: A Road Just for Cars.” The New York Times, SportsSunday Section (Sun., October 12, 2008): 13.
(Note: the centered bold ellipses were in the original; the other ellipses were added.)
(Note: the online version of the article has the date October 9, 2008.)

The book mentioned in the article, is:
Kroplick, Howard, and Al Velocci. The Long Island Motor Parkway. Mount Pleasant, SC: Arcadia Publishing, 2008.

“Approximate Route of Long Island Motor Parkway.” Source of caption and map: online version of the NYT article quoted and cited above.

“The Million-Dollar Question” for “Our Long Economic Slump”: Why “the Severe Downturn in Jobs”?

(p. 5) [There are] . . . two underappreciated aspects of our long economic slump. First, it has exacted the harshest toll on the young — even harsher than on people in their 50s and 60s, who have also suffered. And while the American economy has come back more robustly than some of its global rivals in terms of overall production, the recovery has been strangely light on new jobs, even after Friday’s better-than-expected unemployment report. American companies are doing more with less.
“This still is a very big puzzle,” said Lawrence F. Katz, a Harvard professor who was chief economist at the Labor Department during the Clinton administration. He called the severe downturn in jobs “the million-dollar question” for the economy.

For the full commentary, see:
DAVID LEONHARDT. “CAPITAL IDEAS; The Idled Young Americans.” The New York Times, SundayReview Section (Sun., May 5, 2013): 5.
(Note: ellipsis, and words in brackets, added.)
(Note: the online version of the commentary has the date May 3, 2013.)

Record Companies Refused to See Efficiency of Napster Distribution System

Source of book image: online version of the WSJ review quoted and cited below.

(p. A15) . . . the central character in “Appetite for Self-Destruction” is technological change.
. . .
Record labels scrambled to negotiate with Napster and develop a legal version of the service with multiple revenue streams. The attempts all failed. In Mr. Knopper’s telling, there were unreasonable demands on all sides. But he faults music executives for “cling[ing] to the old, suddenly inefficient model of making CDs and distributing them to record stores. . . . In this world, the labels controlled — and profited from — everything.” In the new world being ushered in by Napster, he writes, control was shifting “to a snot-nosed punk and his crazy uncle.”
The labels’ inability to reach an agreement with Napster destroyed “the last chance for the record industry as we know it to stave off certain ruin,” Mr. Knopper writes in a typically overheated passage. Had a deal been consummated, he suggests, a legal version of Napster might have generated revenues of $16 billion in 2002 and saved the industry. Whether or not the author’s estimate is accurate, his larger point remains: The music industry’s big mistake was trying to protect a business model that no longer worked. Litigation would not keep music consumers offline.

For the full review, see:
JEREMY PHILIPS. “BUSINESS BOOKSHELF; Spinning Out of Control; How the record industry missed out on a chance to compete in a new digital world.” The Wall Street Journal (Weds., February 11, 2009): A15.
(Note: first two ellipses added; third ellipsis in original.)

The book under review is:
Knopper, Steve. Appetite for Self-Destruction: The Spectacular Crash of the Record Industry in the Digital Age. New York: Free Press, 2009.

The Decay of River Rouge’s Diseconomies of Scale

“The rolling hall at Ford’s River Rouge plant, one of Andrew Moore’s photographs of Detroit.” Source of caption and of the Andrew Moore photo: online version of the NYT article quoted and cited below.

Ford’s River Rouge plant near Detroit is a standard textbook example of diseconomies of scale (aka diminishing returns to scale). The image above is an apt illustration of the consequences of diseconomies of scale.

(p. 19) A Connecticut native, Mr. Moore moved to New York in 1980, living near South and John Streets in Lower Manhattan. At night he would wander the neighborhood taking pictures of the construction of the South Street Seaport, which kindled an interest in documenting “life in flux,” he said. “I like places in transformation, the process of becoming and changing.”
. . .
Photos like those of the enormous rolling hall at Ford’s River Rouge plant and a sunset over the Bob-Lo Island boat dock were inspired, Mr. Moore said, by 19th-century American landscape painters like Frederic Church and Martin Johnson Heade.

For the full story, see:
MIKE RUBIN. “Capturing the Idling of the Motor City.” The New York Times, Arts&Leisure Section (Sun., August 21, 2011): 19.
(Note: ellipsis added.)
(Note: the online version of the story has the date August 18, 2011.”)

Andrew Moore has a book of his photos of Detroit:
Moore, Andrew, and Philip Levine. Andrew Moore: Detroit Disassembled. Bologna, Italy: Damiani/Akron Art Museum, 2010.

Samuel Adams Is Underrated Founder Because He Burned His Paper Trail

Source of book image: online version of the WSJ review quoted and cited below.

(p. A17) “Samuel Adams: A Life” makes it abundantly clear why the British so detested Adams. He started talking independence more than a decade before the Declaration and did more than anyone to organize opposition to colonial taxes and to make “no taxation without representation” a rallying cry. . . .
. . .
If Mr. Stoll’s biography lacks the narrative power of books on other Founders, such as David McCullough’s “John Adams,” the reason may be that the paper trail left by Samuel Adams is frustratingly short. He destroyed much of his correspondence during the revolutionary years, fearful that it could fall into the wrong hands. Some of the letters that remain end with the words “burn this.” This Adams wasn’t playing for the history books. He was trying to plot a revolution. Mr. Stoll makes a convincing case that Samuel Adams is not just the most underrated of the Founders but also one of the most admirable, down-to-earth and principled (he worked to abolish slavery).

For the full review, see:
JONATHAN KARL. “Revolution Is No Tea Party; Rabble-rouser, wordsmith, strategist and defender of liberty.” The Wall Street Journal (Tues., November 3, 2008): A17.
(Note: ellipses added.)

The book under review is:
Stoll, Ira. Samuel Adams: A Life. New York: Free Press, 2008.

Why Wind Power Has Not, and Will Not, Replace a Single Conventional Power Plant

(p. A17) After decades of federal subsidies–almost $24 billion according to a recent estimate by former U.S. Sen. Phil Gramm–nowhere in the United States, or anywhere else, has an array of wind turbines replaced a single conventional power plant. Nowhere.
But wind farms do take up space. The available data from wind-power companies, with which the Environmental Protection Agency agrees, show that the most effective of them can generate about five kilowatts per acre. This means 300 square miles of land–192,000 acres–are necessary to generate the 1,000 megawatts (a billion watts) of electricity that a conventional power plant using coal, nuclear energy or natural gas can generate on a few hundred acres. A billion watts fulfills the average annual power demand of a city of 700,000.
. . .
The promise that wind and solar power could replace conventional electricity production never really made sense. It’s known to everybody in the industry that a wind turbine will generate electricity 30% of the time–but it’s impossible to predict when that time will be. A true believer might be willing to do without electricity when the wind is not blowing, but most people will not. And so, during the 30% of the time the blades are spinning, conventional power plants are also spinning on low, waiting to operate during the other 70% of the time.

For the full commentary, see:
JAY LEHR. “OPINION; The Rationale for Wind Power Won’t Fly; Physical limitations will keep this energy source a niche provider of U.S. electricity needs.” The Wall Street Journal (Tues., June 18, 2013): A17.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date June 17, 2013.)