The UN Should Be Anywhere But New York

Where, after all, do universal human rights begin? In small places, close to home - so close and so small that they cannot be seen on any maps of the world. Yet they are the world of the individual person; the neighborhood he lives in; the school or college he attends; the factory, farm, or office where he works. Such are the places where every man, woman, and child seeks equal justice, equal opportunity, equal dignity without discrimination. Unless these rights have meaning there, they have little meaning anywhere. Without concerted citizen action to uphold them close to home, we shall look in vain for progress in the larger world - Eleanor Roosevelt

There is no such thing as the United Nations. There is only the international community, which can only be led by the only remaining superpower, which is the United States...The Secretariat Building in New York has 38 stories. If you lost ten stories today, it wouldn't make a bit of difference - John Bolton, former US ambassador to the United Nations

Given that his campaigning self promised a more internationalist outlook, it is striking how Barack Obama hews more closely to the John Bolton School of International Relations (now there's a thought for you) than that of Eleanor Roosevelt. In addition to keeping that shining example of American justice Guantanamo Bay alive and strong, the Obama administration has done little in terms of Roosevelt's "concerted citizen action" at home. As Eleanor Roosevelt suggested, a likely reason why we often "look in vain for progress in the larger world" is because of unyielding negativity about the UN from the country it is headquartered in. Home ain't where the heart is.

As I will enumerate, the US routinely flouts conventions people from other parts in the world consider valuable--especially in terms of advancing rights. Given the plenitude of such examples, it is best to consider the US a delinquent parent of the organization. Unfortunately, John Bolton's flippant suggestion that nothing much would be lost if ten floors of the UN were blown off is not far from actual US policy. Indeed, the Obama administration is next to no improvement seen in this light -

"The United States is concerned about children's rights and welfare."

Americans blather on and on about human rights. Call it the white man's harangue. So much so that you'd expect it to have ratified the well-meaning UN Convention on the Rights of the Child (CRC), right? If you read my lengthy post on why the shameless publicity seeker Amy Chua is more American than Chinese, then you would know that it isn't. How embarrassing is this? Well, aside from a failed state (Somalia), the US is the only other country that hasn't ratified it. Alike Guantanamo, it appears Obama has not been more talk than action in behaving in an internationally acceptable manner.

For all its human rights happy talk, the truth, dear readers, is this: the United States is a miserable place to be a kid. But don't take my word for it. The OECD recently compared the well-being of children across developed countries and found that the US ranked second worst next to the UK--and by quite some margin. Perhaps you and I should be concerned about this American failing that is only reinforced by its failure to ratify this convention. Child misery, thy name is America:

"The United States wishes that women have equal rights to men."

While the US does somewhat better on measures of gender equality such as the pay gap, it has yet to achieve several milestones others have alike having a female head of state. Most plausibly, America's chauvinistic tendencies are behind it not inking the UN Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW). In another shameful display, the US is noted by commentators to be the only developed nation not to ratify CEDAW. A shining beacon of gender equality for the world to follow? I think not.

"The United States condemns crimes against humanity."

The Bush administration was famously hostile to pursuing the ratification of US membership in the International Criminal Court (ICC) based in the Hague. While the Obama administration has stopped its predecessor's outright hostility to the body, it still remains aloof to the idea of ratifying participation. Then again, given the United States' continuing penchant for extrajudicial imprisonment, I guess membership in the ICC is not on the game plan for the immediate future despite more internationalist voices calling for it.

"The United States cares about the welfare of migrants."

It is well-known that virtually all signatories to the UN Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families are migrant-sending nations. Despite calling itself the land of opportunity, a melting pot, and so forth, the truth is that the US is just as reluctant as other developed nations to sign on to something which concerns guaranteeing the welfare of migrants. In trade terms, it is unsurprising a country that has so far been unwilling to implement WTO provisions concerning temporary migration is also unwilling to extend them substantive international rights.

"The United States does not want to deploy land mines indiscriminately."

Activists have, for a long time, been championing the reduction in the use of land mines for the simple reason that they tend to kill and maim civilians--often long after conflicts that resulted in them being deployed have ended. However, the US has once again not ratified the Anti-Personnel Landmines Convention. For a country that is already malodorous in so many parts of the world due to its militaristic excursions, this shameful omission only reinforces America's negative image.

"The United States cares about the environment."

Kyoto Protocol. Nuff said.

"The United States has a national interest in respecting international maritime law."

Of all the conventions left unsigned by the US at the UN, the Convention on the Law of the Sea (UNCLOS) is perhaps the most interesting one in terms of geopolitical implications. In fact, Hillary Clinton alluded to it last year during the non-controversy over the South China Sea the US fomented at the ASEAN Regional Forum. As I have explained, the utterly hypocritical point is that the US has not ratified UNCLOS but claims that its stipulations should be followed when it comes to resolving others' disputes. Hypocrisy aside, meddling in others' disputes without a discernible legal basis to do so takes a lot of nerve.
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All in all, here is the bottom line when it comes to the US and the UN: If you don't bother with much of anything people of the world devote their valuable time and effort to, then you might as well not host the United Nations. Let's face it: Americans tend to be very parochial in outlook. This negative kind of American exceptionalism poisons international relations through thinking that what goes on in the UN is not in US interests in so many instances. Alike with the IMF which really ought to be in Beijing, the time has come to move the UN elsewhere. The world has moved on. I won't even get into the US offering the sole veto over discouraging continued Israeli settlement of the occupied territories.

There's a saying that you shouldn't stick around where you're not wanted. I guess now is as good as time as any for the UN to move from a country of the past that doesn't care much for it (by brushing off any number of conventions) to a country of the future that at least embraces its core belief in the value of multilateralism. There is no point remaining in a location which undermines it at almost every turn like the United States does. A reason why the UN is often ineffective is because of America's delinquent parenting as its host nation. Think of a child continuously being belittled, insulted and threatened by its parents and modern US treatment of the UN comes to mind. (Not that actual American parenting is much better--see above.) That it even functions at all is a wonder.

When the United States is such an all-around bad example for core UN principles alike human rights, justice, opportunity, and non-discrimination, it's best to skip town. That's something John Bolton and I can probably agree on. Does modern America do Eleanor Roosevelt proud? As I said, the UN should be anywhere but New York.

Fire Sale America, Way to Fix US Budget Woes?

Here's a fun Newsweek article I missed by none other than LSE IDEAS' own Niall Ferguson. Yes, the same Newsweek sold for $1--a once-great American institution fallen under hard times like so many others. While I suspect that I may be writing more about shutting down American government for a prolonged period of time in the next few days--something I want to do, mind you--here's some food for thought in the meantime.

There are a number of things obvious about the modern-day United States. It's mind-bogglingly broke at the federal level. Many states and cities there are no better off, either. At the same time, though, Americans are reluctant to given in to the natural solution of selling off valuable assets. Say, corporations at the sharp end of the innovation league tables due to "security" concerns. If you thought that solution was pretty severe, Professor Ferguson has come up with something that should raise a true patriot's hackles even more. For, he says that the US should get real and sell off its vast holdings to help raise revenue. In America? Getouttahere! Given characteristic US inability to balance the books (what's that?), it's certainly something they should consider, though:

Yet there is another fiscal option that neither party seems to be considering. The U.S. needs to do exactly what it would if it were a severely indebted company: sell off assets to balance its books...The mystery is why freedom-loving Americans are so averse to privatization—a policy that has been a huge success nearly everywhere it’s been tried. From Margaret Thatcher’s Britain, where the word “privatization” was coined, to present-day China, selling off government-owned industries has not only improved the fiscal position of governments; it has usually enhanced the efficiency with which the sold assets are managed...

So let’s get down to business...the U.S. government currently has about $233 billion worth of nondefense “property, plant, and equipment,” according to the Treasury’s Financial Management Service. That is almost certainly an understatement. The government owns somewhere between 600 million and 700 million acres of land, or about 30 percent of the country’s land surface, much of it in the Western states, where as much as half the land is federally owned.

Washington could also sell its stakes in the Southeastern Power Administration and related assets as well as the Tennessee Valley Authority’s electric-power assets. There’s Amtrak (which runs at a loss) and the extensive hydroelectric empire of the U.S. Army Corps of Engineers.

And then there are the assets that have the potential to be among the most lucrative of all: America’s highways. Plenty of other countries—Japan, Turkey, and even China, to name just three—have already privatized substantial parts of their transportation infrastructure, leaving private companies to manage both revenues and maintenance.

American highways sold to foreign investors? It may sound unthinkable, but it’s already happening. Indiana recently leased the operation of the state’s principal 157-mile highway to a consortium led by the Spanish company Cintra and the Australian investment bank Macquarie. For the next 75 years, the consortium will collect the tolls from motorists. Indiana got $3.85 billion upfront. The city of Chicago has done a similar deal, leasing out its Skyway toll bridge for $1.83 billion. A few other state governments have been moving hesitantly down this same path, usually by setting up public-private partnerships to manage stretches of highway.

But there’s so much more that could be done. California’s government has an estimated $103 billion in assets, including state highways with a book value of $59 billion. Are you telling me a sovereign wealth fund from, say, Singapore couldn’t do a better job of running those choked and often potholed roads? Yet one of Gov. Jerry Brown’s first acts since returning to office was to cancel a planned privatization of state-owned office buildings.

From sea to shining sea, American politicians are running scared from the only credible solution to the country’s fiscal crisis. Rather than publishing honest balance sheets with meaningful valuations of both their assets and liabilities, they’d rather maintain the fiction that it’s their job to invest billions in high-speed railroads and the like.

Let’s face it: if you want to see serious investment in America’s infrastructure—and the American Society of Civil Engineers estimates that a full upgrade would cost $1.3 trillion—it isn’t going to come from the likes of Governor Brown, much less President Obama. They’re broke, folks [Amen to that].

There are, remember, two kinds of economies in this world: those with guns and those who dig—those with piles of cash and those with mountains of debt. Sure, the debtors can keep on borrowing until their creditors revolt, or they can try to dig their way out with austerity budgets. But a better idea would be to get smart and start inviting bidders to what could be the sale of the century.

I am thoroughly in agreement with this. Having encouraged the Chinese to run US K-12 schools, I also think broke public American universities (alike the much-vaunted but now struggling for survival UC system) should be sold to foreigners too. To tweak my colleagues at IPE@UNC, their highly reputable but down-at-the-tar-heels institution could probably be sold to LSE IDEAS' partner institution, Peking University! I can see it now: the Tar Heels, property of the PRC.

Fire sale America: it's long overdue. To be fair, however, Niall Ferguson may have overlooked resistance here in the UK against similar plans. Although the UK isn't nearly as broke as the US, Environment Secretary Caroline Spelman recently had to withdraw the idea of selling 258,000 hectares of state-owned woodlands over alleged environmental grounds:

Controversial plans to sell 258,000 hectares of state-owned woodland in England have been abandoned. Environment Secretary Caroline Spelman told MPs the government had "got this one wrong", as she announced the current consultation was being halted. Instead, it is understood a new panel of experts will be set up to look at public access and biodiversity within the publicly owned woodland. Labour said it showed the government was "incompetent" and "out of touch". The plans were intended to give the private sector, community and charitable groups greater involvement in woodlands by encouraging a "mixed model" of ownership.

But critics argued it could threaten public access, biodiversity and result in forests being used for unsuitable purposes. The public outcry over the plans led to half a million people reportedly signing a petition against the sell-off.

In a statement to MPs, Mrs Spelman announced the policy was being removed from the Public Bodies Bill currently going through Parliament. She said: Ms Spelman said: "I would first like to say that I take full responsibility for the situation that brings me before the House today. "Let me make it clear that we have always placed the highest priority on preserving access and protecting our forests...But the forestry clauses in the Public Bodies Bill, published well before we launched the consultation, gave the wrong impression as to the government's intentions."

I doubt whether the Yanks will long be able to afford to make similar excuses. Moreover, $233 billion worth of non-defence plant, property and equipment by Niall Ferguson's calculations is a drop in the bucket compared to trillion-dollar plus deficits the US has run and will continue to run. What happen after the US has fully unloaded the family silver? Then again, desperate times call for desperate measures.

'Tiger Mom' Amy Chua More American Than Chinese

Oh, to be rid of this riff-raff once and for all. Let's face it: there are certain popular authors social science academics find cringeworthy. Reading the output of such writers usually reveals obvious shortcomings. Dambisa Moyo combines regurgitation of others' ideas with simple factual errors. Meanwhile, Amy Chua stretches personal anecdotes to represent wide-ranging phenomena. Views of (prejudiced) Chinese-Filipinos become the basis of setting the World on Fire. Or, in perhaps the most puzzling simplification to date, her wish to continue strict parenting she experienced becomes a 'Chinese' parenting war cry in Battle Hymn of the Tiger Mother. Although she claims this book to be more of a memoir, she does list it among her academic publications, so it's fair game here.

My first major objection is that Chua skips over her nanny's contributions:

...something doesn't add up. That missing piece is her Mandarin-speaking nanny.

That's right, the full-time growling Tiger Mom didn't raise her daughters herself, or even in a simple partnership with her husband. She isn't a stay-at-home mom, she isn't a middle-class working mom, she is a rich woman. And although she insists that her recently published book is not meant to be taken as parenting advice, its message is widely being read as suggesting that the "Chinese" mothering style is superior to the more lenient "Western" way. In any case, the truth is that for mothers who don't have her resources, following her lead would be impossible.

My second major objection is that, for someone teaching law--a trade where one should be precise with the use of words--she uses the term 'Chinese mother' in a very loose sense. In fact, I doubt whether she would even qualify as one. To be exact, she is a Filipino-Chinese migrant to the United States baptised as a Catholic who is not fluent in Mandarin:

She became a law professor and now teaches at Yale. She and her husband, another Yale law professor, hired a Chinese nanny to speak Mandarin, though Ms. Chua doesn’t speak it herself. Ms. Chua grew up as a Roman Catholic, but her daughters were raised as Jews.

My third major objection--one that various talking heads including those who claim to be international relations scholars haven't brought up yet--is that, for a lawyer by profession, Amy Chua does not seem to make much use of international law in discussing international parenting differences. This pattern of simplification is consistent with her previous work as I've mentioned above. Anyway, for the benefit of our dear readers, there is this thing called the UN Convention on the Rights of the Child (UNCRC) under the auspices of the UN Children's Fund or UNICEF:

The Convention on the Rights of the Child is the first legally binding international instrument to incorporate the full range of human rights—-civil, cultural, economic, political and social rights. In 1989, world leaders decided that children needed a special convention just for them because people under 18 years old often need special care and protection that adults do not. The leaders also wanted to make sure that the world recognized that children have human rights too...

By agreeing to undertake the obligations of the Convention (by ratifying or acceding to it), national governments have committed themselves to protecting and ensuring children's rights and they have agreed to hold themselves accountable for this commitment before the international community. States parties to the Convention are obliged to develop and undertake all actions and policies in the light of the best interests of the child.

However, alike with the UN Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW), let's say 'world leaders' of a certain North American nation have not signed up to this important international law. Which, in retrospect, is in keeping with environs where folks like Amy Chua can thrive. Contrary to the image Chua wants to portray, China has acceded to the UN Convention on the Rights of the Child unlike the United States. Embarrassingly, the only state other than the US not to ratify it is a failed one (Somalia). President Obama cringes at this fact, but then again, he's done next to nothing about the matter:

The head of a United Nations monitoring committee today called on Somalia and the United States, the only two countries not to have ratified the Convention on the Rights of the Child (CRC), to do so immediately. “With the best interests of all children at heart, I would respectfully like to reiterate our appeal that these States ratify the Convention on the Rights of the Child,” Committee on the Rights of the Child Chairperson Yanghee Lee told the General Assembly today. That pact is the first legally binding international instrument to incorporate the full range of human rights – civil, cultural, economic, political and social – for youngsters under 18...

Asked at an earlier news conference why the United States had not ratified the treaty, she cited a raft of reasons from lack of political will to myths and misunderstandings about the convention. “The lack of political will is the biggest reason,” she said, noting that President Barack Obama in his 2008 election campaign had said that the US would ratify the treaty, “but we have yet to see that come to fruition.”

Ms. Lee noted that “then there is the misunderstanding that once you ratify this convention parents will have to give up their parental rights, and then children would be running around with all kinds of rights, taking the rights away from parents. “But that’s really a myth and a strong misunderstanding because the convention calls for guidance and support of parents, and families with responsibilities is one of the major provisions in the convention.”

Ms. Lee also cited a pushback from religious groups and also concerns from people who advocate home schooling and are concerned that CRC would abolish it. “But that’s not the case,” she stressed. “We have consistently said for States parties to provide for formal and non-formal education that also includes home schooling.” She also noted that some people have said CRC is pro-abortion and pro-adolescent health but “there is nothing in the convention that would suggest anything that the CRC is pro-abortion.”

It's insular America all over again, profoundly unconcerned about the rest of the world while constructing its own warped narratives. And just what would this self-styled 'Chinese tiger mom' be discouraged from doing? Let us count the ways:

Article 13

1. The child shall have the right to freedom of expression; this right shall include freedom to seek, receive and impart information and ideas of all kinds, regardless of frontiers, either orally, in writing or in print, in the form of art, or through any other media of the child's choice.
2. The exercise of this right may be subject to certain restrictions, but these shall only be such as are provided by law and are necessary:
(a) For respect of the rights or reputations of others; or
(b) For the protection of national security or of public order, or of public health or morals.

Contrast this with tiger parenting:

• As an adult, I once did the same thing to Sophia, calling her garbage in English
  
• The fact is that Chinese parents can do things that would seem unimaginable—-even legally actionable—to Westerners. Chinese mothers can say to their daughters, "Hey fatty—-lose some weight."
• Back at the piano, [7-year-old] Lulu made me pay. She punched, thrashed and kicked. She grabbed the music score and tore it to shreds. I taped the score back together and encased it in a plastic shield so that it could never be destroyed again. Then I hauled Lulu's dollhouse to the car and told her I'd donate it to the Salvation Army piece by piece if she didn't have "The Little White Donkey" perfect by the next day.
• [Recall those toothmarks on the piano keys from another anguished child]
  

And speaking of which, consider this article too:

Article 16

1. No child shall be subjected to arbitrary or unlawful interference with his or her privacy, family, or correspondence, nor to unlawful attacks on his or her honour and reputation.
2. The child has the right to the protection of the law against such interference or attacks.

Lastly, what would UNICEF suggest parents sensibly do?

• Respect children. Use positive and non-violent discipline, including respecting the child’s perspective.
• Communicate with children. Children and adults should actively and consistently talk to each other, sharing information and ideas in the home, school and community with mutual respect. Listen to, and take seriously, the views of both boys and girls. Ensure that vulnerable children are able to express their opinions and make decisions

She can say that the Convention is wishy-washy, that Chinese parents don't really abide by it, or that the US is right not to ratify it. However, not engaging with the Convention is a professional boo-boo. She seems to be pretty good at self-promotion, but not particularly at her job of understanding laws that pertain to things she's interested in--like parenting. Remember, she's the 'John M. Duff, Jr. Professor of Law,' not yours truly. Instead of attempting to generalize the experience of Chinese parents, she could have done any number of things like review the substantial literature on culturally-based parenting styles. I understand there are any number of academic journals on education, family studies, and cross-cultural differences. Or, she could have investigated why China has adopted the Convention while the United States not.

So, for (1) being ill-informed about a great many things the rest of us are aware of despite her high-faluting credentials [typical Amerocentrism]; (2) maltreating her kids in apparent contravention of the UN Convention on the Rights of the Child [which only the US and a failed state have failed to ratify]; (3) exploiting her kids for shameless self-promotion [America is the land of Jerry Springer and the reality show]; and (4) hypocritically failing to mention that a nanny does a considerable part of the upbringing in their household [too many examples of US hypocrisy to cite]--I dub Amy Chua an American phenomenon. I won't even mention the dubious genealogical bit.

Why does this sort of wilful kidsploitation gain so much attention Stateside and virtually none to intelligent debate about passing meaningful international laws concerning the protection of children? It shows you just how skewed American priorities are towards rewarding cheap sensationalism. Surely, I know which nation is famous for acting out its behavioural issues in public. While Americans may be preoccupied with obvious US decline, my argument is that Amy Chua presents nothing more than a caricature of being a Chinese parent. Jerry Springer, Ricki Lake, Amy Chua...honestly, what's the difference?

Amy Chua, do us a favour: You're supposedly a lawyer. Do your job and tell us something about laws pertaining to topics you're interested in.

Are Brits Dumb Enough to Hold $511B in Treasuries?

(OK, so that's an obviously loaded question. But hey, this is a blog for crying out loud.)

With apologies to our Chinese colleagues, I generally hold one's Treasury holdings as a yardstick for one's gullibility. If you're dumb enough to own so much stake in a sunset nation like America, then you really have no one but yourself to blame when it inevitably goes down like, well, a Led Zeppelin. And speaking of the homeland of that legendary band, something striking that has not gained much notice is the United Kingdom supposedly having accumulated over half a trillion in these papers by November 2010. In a year's time if we are to believe US government figures, UK Treasury holdings have increased by a scarcely believable $356.3 billion, from $155.5 to $511.8B.

Brad Setser usefully pointed out how monthly Treasury data was subject to annual revisions that usually resulted in the UK tally being marked down significantly while that of China being marked up significantly. The same is probably true here. As before, London's status as a global financial centre is being used to facilitate Treasury purchases by those wary of being identified as avid purchasers of American debt for obvious reasons. In this day and age, announcing that you're an enthusiastic buyer of American debt is rightfully identifying yourself as a target for ridicule. Simply put, why invest in a country whose best years are well behind it instead of one whose fate is most likely the opposite on existing trends? China certainly has a habit of not promptly updating its reserve figures...I wonder why.

CNNMoney has an interesting article on China being the new landlord of the US--a somewhat less bold assertion than mine that the Chinese are the real owners of that dissipated place. Hyperbole (but not much) aside, the point is alluded to that most UK holdings are probably attributable once more to the Chinese attempting to hide the extent of their folly--especially to domestic audiences wary that so much money could be spent in so many far more socially productive ways:

There's also the issue of just how much U.S. debt China really owns. The official number reported by the Treasury is just a hair under $900 billion. But the actual amount could be higher, said Nancy Vanden Houten, an analyst with Stone & McCarthy Research Associates in Princeton, N.J.

That's because it is widely believed that China has used dealers in the United Kingdom to scoop up Treasuries. Those purchases would then show up on the holdings for the U.K., not China. And while the amount of China's debt holdings are roughly the same now as at the start of 2010, the U.K.'s holdings has surged from $208 billion in January to $511 billion in November.

Which brings us to a larger point: China shouldn't complain too much about characteristically self-important, bratty American behaviour insofar as it has indulged so much of it (and tried to hide it out of shame). It's bad parenting pure and simple, but more on this later. Aside from being hard up and currently embarking on a pretty hardcore austerity programme, the UK is certainly in no position to fritter away so much money. Nor is there any massive public outcry here over how the government is ploughing hundreds of billions into Treasuries. The only reasonable conclusion is that the UK is being used by an entity or a group of entities as an intermediary for very large scale purchases of US sovereign debt. If historical precedent is accurate, then the revisions should point to China. You can bet your bottom dollar that China has more than an unfathomable $3 trillion in reserves by now.

But then again, as Yankee impresario PT Barnum said, a fool is born every minute. That pretty much sums up modern US grand strategy--hoodwink others into believing the US is a "safe" investment--though I don't think the UK is culpable despite what the figures indicate at the moment.

OECD on Education: Chinese Bury US Students

About the capitalist states, it doesn't depend on you whether or not we exist. If you don't like us, don't accept our invitations, and don't invite us to come to see you. Whether you like it or not, history is on our side. We will bury you!

One of the signature statements of the Cold War was Nikita Khrushchev saying the above phrase to Western diplomats in 1956. While it was certainly enjoyable bluster alike his alleged shoe-banging incident at the UN General Assembly four years later, let's say that history was not on his side. However, let's now turn to an altogether different sort of command economy of the "market authoritarian" sort.

Call it Michael Fay syndrome. I needn't remind readers about the pitiful performance of the American educational system or "K-12" from kindergarten to the twelfth grade. High school leavers' continuously declining performance is certainly no reason to be optimistic about the decrepitude of American education. In international comparisons, American pupils underwhelm--to put it mildly. Now, the OECD has just released its 2009 edition of the Programme for International Student Assessment (PISA) comparing the performance of 15-year-old students from 65 countries on a standardized test with reading, science, and math portions. While the 2006 edition flagged up the unsurprisingly poor performance of the United States, let's say things haven't gotten much better overall. Despite marginal improvements, the overall picture remains the same. In comparison to its peers, the US lags.

More embarrassingly, this is the first edition of the PISA to include evaluations of students from mainland China. (Note that this is being done for comparison purposes, not because China is an OECD member.) While students from Hong Kong have routinely kicked Yankee student butt for years, we now understand that the youth from the town of Shanghai do a pretty damn good job of doing the same (not that it's so hard given the bedraggled state of modern America). The table above from the Sydney Morning Herland should ram home this point: the sample of Shanghainese students are tops in reading, science, and math. In comparison, their Yankee peers are...near or below OECD average in all three areas. From the Christian Science Monitor:

The latest results from the Programme for International Student Assessment (PISA) released Tuesday by the Organisation for Economic Cooperation and Development (OECD) show Asian students – particularly those from China, who participated in the exam for the first time in 2009 – at the top of the pack, with the United States generally in the middle or, in math, toward the bottom.

“We are in the middle of the pack; that’s not where we want to be,” said Stuart Kerachsky, deputy commissioner of the National Center for Education Statistics, in a call with reporters. “That’s not the goal, but all I see in these numbers is things maybe inching in the right direction.”

The test is given to 15-year-old students in dozens of countries around the world every three years, and aims to assess their reading, math, and science literacy as they prepare to enter college or the workforce. It has long been used in the US to raise alarm bells about American students falling behind in a global world.

And indeed, the most striking result from the 2009 PISA may be the top performance of Chinese students, who participated in the exam for the first time with a pilot program that tested students in several cities. Mr. Kerachsky and others cautioned not to read too much into the comparisons, since they are from cities – those which draw many of China’s top students – and are hardly representative of all of China. But the results from Shanghai, in particular, which came out No. 1 in all three subject areas, were remarkably high.

In math, for instance, Shanghai students scored an average of 600 (on a scale with a 500-point average). Students in Korea, the top OECD country, scored a 546, and in the United States, they scored 487. That score puts them in 25th place among the 34 OECD countries, though the score is statistically lower than just 17 of those countries, and indistinguishable from 11 others.

American students scored below the OECD average of 496. The countries outperforming the US include Finland – perennially a top-shower on PISA, along with Korea – Belgium, Estonia, Iceland, France, and the Slovak Republic, among others. US students scored higher than those in just five OECD countries: Greece, Israel, Turkey, Chile, and Mexico.

Yes, you can complain that Shanghai isn't representative of the educational performance of China as a whole. Then again, why not get American students from the largest US cities of New York or Los Angeles to participate and I'd still wager that the kids from Shanghai will utterly demolish the US kids. The thankful difference between Cold War-era Soviet Union and China is simple: unlike Khrushchev and others full of his sort of bluster, the Chinese don't really brag about their achievements, preferring to be low-key about them. But on a day like this, the world wakes up and realizes that Chinese students seem to be leaving their American brethren far behind in terms of academic performance. With so many near-insolvent US states left with few choices but to cut education budgets, I am not optimistic about future US performance in international education comparisons like PISA.

I do look forward to these OECD reports that tell us what we already suspect but now have hard evidence to back up. Yes, Americans are getting fat as all get-out. And now, yes, American kids aren't exactly the brightest. So actually Nikita, as American students demonstrate, there's no need to bury America. It's doing a pretty damn good job burying itself.

Ex-IMF Chief Economist: IMF HQ Should Be in PRC

Former IMF Chief Economist Simon Johnson should be familiar to readers of the fine Baseline Scenario blog which he writes together with James Kwak. While visiting the Bloomberg website, I came across a rather intriguing op-ed in which he discusses the Ireland crisis. Aside from the usual European political-economic gyrations to consider, he makes a seemingly off-the-wall suggestion that had me thinking: Given that they are the world's new moneybags compared to the hard-pressed Europeans and subprime-addled Americans, he believes the Chinese are well-placed bail out troubled Eurozone economies. What's more, he says doing so should buy the PRC some breathing room from constant EU and US complaints over unfair trade practices:

In fact, the Irish leadership has every incentive to delay until other countries can be dragged into turmoil. The crisis will become euro-zone wide, at which point all eyes will turn to some combination of the European Central Bank, the German taxpayer, and the IMF. But the ECB can’t pay and the German taxpayer won’t pay. Does the IMF have the resources to tackle Spain, let alone a bigger country like, say Italy or even France? The U.S. could add sufficient funding to the mix -- this is what it means to be a reserve currency -- but the mood in Washington has shifted against bailouts.

As an alternative, Europe could place a call to Beijing to find out if China would like to commit some of its $2.6 trillion in reserves to keep European creditors whole. This would be an enormous opportunity for China to vault to a leading global role. Perhaps it was a good idea to place Min Zhu, a top Bank of China official, in a senior position at the IMF.

If China offered to recapitalize the IMF, become the largest shareholder, and move the organization to Beijing (according to the Articles of Agreement, the IMF’s headquarters should be in the capital of the largest shareholder), wouldn’t that make for an interesting chess game?

Whoa, now you're talking. Simon Johnson is of course correct in pointing out that the IMF Articles of Agreement stipulate that the institution should be headquartered in the country of its largest funder. Remembering that the US was the world's largest creditor back in the day--the postwar period, to be exact--it certainly wouldn't have occurred to those present at Bretton Woods that Generalissimo Chiang Kai-Shek's pipsqueak communist rivals would soon become the world's largest creditors a couple of decades down the line. (Or even China's leaders, of course.) Here is the relevant IMF text:

Article XIII - Offices and Depositories

Section 1. Location of offices

The principal office of the Fund shall be located in the territory of the member having the largest quota, and agencies or branch offices may be established in the territories of other members.

Thinking about it more, doesn't it sound far-fetched to us that Beijing will become the host of IMF headquarters as China becoming the world's largest creditor did in 1944 to those at Bretton Woods? Times are a-changing, so I'm not one to rule out this happening in my lifetime. That said, there are formidable obstacles to this happening:

• Won't the Chinese swapping foreign exchange holdings for SDRs detract from "managing" foreign exchange levels?
• Wouldn't the Chinese be wary of bequeathing the opprobrium heaped on the US for being the hosts for this often-unpalatable lender-of-last-resort?
• Similarly, wouldn't China be wary of losing its self-proclaimed status as a champion of Third World causes and become the very embodiment of "economic imperialism"?
• If China's interest is in showing magnanimity towards fallen minor Eurozone countries (as it has already indicated before), why bother with the American-dominated IMF and just lend unilaterally?
• Despite being flat broke and rather pathetic , would the US readily countenance losing the IMF so easily as another signifier of American decline?
• Perhaps conveniently for certain countries, participation in IMF facilities like the General Agreements to Borrow (GAB) and New Agreements to Borrow (NAB) do not necessarily boost voting shares for emerging large contributors.

The geopolitics are certainly interesting: Will a weary nation relinquish one of the remaining levers it holds on the world economy so readily? Is the new contender willing and able to take up this mantle of leadership? All I can say is that the world economy certainly looks different from where I'm sitting 64 years after the halcyon days of John Maynard Keynes and Harry Dexter White. Bring on Beijing, baby!

Dontcha Worry About China; RMB Reval 'Inevitable'

And now for a belated Halloween feature...of sorts. (Boo!) For most Americans, the unmistakeable decline of the American economy--they wouldn't be all in a lather about throwing current lawmakers out en masse if not, eh--is tied to the growing prominence of China. Both find expression in election season advertising portraying political opponents as being in cahoots with the Chinese. Scapegoating others for largely homegrown ills is a regrettable but unsurprising American pastime. Now, every American generation has its set of bogeymen--Reds under the bed, Japan buying America, and now China competing unfairly with the United States via "currency manipulation" and other dastardly practices. Signs of conflict are rife and unmistakeable. Among other things, the last congress passed a bill that envisions hitting China with sanctions should it not change its erring ways.

An obvious advantage for critics in constructing bogeymen is that they never change since they are the product of (often inaccurate) stereotypes and, for lack of a better term, A Lot of Yanquis Scaring Themselves Silly Over Their Steadily Declining Standard of Living. Famously incurious about the rest of the world, there is a bland whitebread sameness you get out here--especially in much of the US-dominated blogosphere. The IPE Zone being a far more cosmopolitan outlet in name and in deed, leave it up to yours truly to bring a distinctly different possibility: What if China is already well on its way to freely floating its currency? Also, what if constant pestering by haughty Americans busy trying to devalue their way to prosperity doesn't go down too well and instead slows down a move towards a freely floating renminbi?

Well, Reuters has just the article for this contrarian line of thinking from an adviser to that bastion of financial chicanery, the People's Bank of China (PBoC):

The yuan needs to be more flexible and appreciation is the long-term trend for the currency, an academic adviser to the People's Bank of China said on Friday. Li Daokui, who sits on the central bank's monetary policy committee, also said that exchange rate adjustment should be based on domestic factors and not just on external pressure.

"In the long run, the renminbi needs to appreciate if market forces determine that," Li, a professor at Tsinghua University, told an academic forum. The renminbi is the official name of the yuan. Li said a 3-5 percent annual pace of appreciation, about the same as before the global financial crisis, would be regarded as "gradual" and would be acceptable to the government.

China had let the yuan gain nearly 3 percent against the dollar since it was depegged on June 19, but it has pushed the exchange rate back down by about 0.6 percent over the past two weeks. Analysts believe that the currency is still on course to rise and that the central bank has been making good on its pledge to introduce more two-way volatility in the exchange rate.

A stronger yuan is seen as a key component of China's reforms to cut its trade surplus and contribute to the rebalancing of the global economy. Critics say that an undervalued yuan gives Chinese exporters an unfair advantage. Li said that China's trade surplus would be greatly reduced over the next three years as the government enacts reforms to restructure the economy.

To bolster this line of argument, consider that the Chinese may not have been so unfailingly hostile to the US proposal to limit G20 countries' external imbalances to ±4% even if doing so targeted chronic surplus countries like the PRC and Germany. Supposedly, there already was legislation underway in China itself to limit the relative size of its external surplus, hence it needed little prodding to begin with. But, as I mentioned above, perhaps the key thing is for the PRC to implement these changes on their own instead of them perceiving that they are being browbeaten into making them:

At G20 finance minister meetings in South Korea earlier this month, the United States proposed that countries set a target of capping either their current account surplus or deficit at 4 percent of gross domestic product.

Although rejection of the proposal was virtually unanimous, it has found a slightly more receptive audience in China. "We have the economic and political foundation to reach an agreement," Li said. But he added that China would not want to accept any imposed standards or external checks and would only set targets of its own volition.

Yi Gang, a central bank vice governor, has said that China is drafting a plan to limit is current account surplus to less than 4 percent of GDP over the next three to five year.

Short of buying adult diapers for a majority of the US population, that should help calm American fears about China, right?

Fareed Zakaria on Restoring the American Dream

TIME-CNN has evidently hired former Newsweek editor Fareed Zakaria lock, stock, and barrel. Before, he already had his GPS programme on CNN. With Newsweek being sold for $1, he's evidently transferred his print commitments to TIME magazine as well. Not one to dwell with small topics like yours truly, he attempts to explain no less than how to restore the American Dream. You needn't ask me what I think of it as it's probably dead and gone. Indeed, the standard of living of the current generation of folks living in that subprime pastime paradise will, on current trends, be assuredly lower than that of their predecessors. Before getting to his article, I 'd also like to point out that he would have done better had he mentioned a host of other things I've covered in one way or another:

• No mention of reducing inequality that spreads benefits per increment of national income better;
• No mention of increasing very limited social mobility (the Horatio Alger part of the American dream or, more accurately, delusion);
• No mention of getting extraordinarily portly Americans to be fit, which is a more proactive way to control health care costs;
• No mention of how public policy can encourage beneficial apprenticeships instead of often-pointless college degrees as he alludes to which afford few job opportunities;

Ah well, enough of me. The essay is well worth reading if ever so optimistic. Here are his main suggestions:
-----------------------------------------------
What We Need to Do Now

Ultimately American jobs are created from the bottom up by companies, not from the top down by government fiat. But there are measures we can take that will encourage the process. Here are the key ones:

Shift from consumption to investment. Fundamentally, America needs to move from consumption to investment. Everyone agrees that the best way to create good jobs in the U.S. is to create new industries and companies and to innovate within old ones. This means large investments in research, technology and development. As a society, this needs to become our strongest focus. (See how the future of work is changing.)

Despite substantial increases and important new projects under the Obama Administration, the federal government is still not spending as much on R&D as a percentage of GDP as it did in the 1950s. I would argue that it should be spending twice that level, which would be 6% of GDP. In the 1950s, the U.S. had a huge manufacturing base that could absorb millions of semiskilled workers. Today, manufacturing is a small part of the economy and faces intense global competition. The only good jobs that will stay in the U.S. are jobs related to knowledge and innovation. Additionally, in the 1950s, America was the only research lab in town, accounting for the vast majority of global scientific spending. Today, countries around the world are entering the arena. Two weeks ago, South Korea — a country of just 50 million people! — announced plans to invest $35 billion in renewable-energy projects. We should pay for this with a 5% national sales tax — call it an American innovation tax — which would be partly offset by a small reduction in income taxes. This would have the twin benefits of tamping down consumption and yielding some additional funds. All the proceeds from the tax should be focused on future generations, because we need to invest massively in growth. (Comment on this story.)

The often overlooked aspect of investment is investment in people. America has been able to create the future in large measure because it has tapped into the energies and work of immigrants. It has managed to invest in human capital by taking smart, motivated people from around the globe, educating them in the planet's best higher-education system and then unleashing them in a dynamic economy. In this crucial realm, the U.S. is now disinvesting. After training the world's best and brightest — often at public expense — we don't find ways to make sure they stay here by giving them a green card but rather insist that they leave and take their knowledge to another country, where they will invent, inspire, build and pay taxes. Every year, we send tens of thousands of the smartest Indians and Chinese back home, which is a great investment — in the future of those countries.

Training and education. "Most jobs that will have good prospects in the future will be complicated," says Louis Gerstner, the former CEO of American Express and IBM. "They will involve being able to juggle data, symbols, computer programs in some way or the other, no matter what the task. To do this, workers will need to be educated and often retrained." We need more and better education at every level, especially job retraining. So far, most retraining efforts in the U.S. have not worked very well. But they have worked in countries that have been able to retain a manufacturing base, like Germany and parts of Northern Europe. There, some of the most successful programs are apprenticeships — which cover only 0.3% of the total U.S. workforce.

There are advantages to the U.S. system. We don't stream people too early in their lives, and we allow for more creative thinking. But the path to good jobs for the future is surely to expand apprenticeship programs substantially so industry can find the workers it needs. This would require a major initiative, a training triangle in which the government funds, the education system teaches and industry hires — though to have an effect, the program would have to be on the scale of the GI Bill.

Fiscal sanity. To pay for such initiatives, the government needs to get its house in order. The single most important aspect of this is getting health care costs under control, followed by other entitlement programs, especially pensions at the state level. Government today spends vast sums of money on current consumption — health care and pensions being a massive chunk of it — which leaves little money for anything else. We need a radical rebalancing of American government so it can free up resources to fund future growth. (Watch a video about being young and uninsured in America.)

Benchmark, benchmark, benchmark. There is now global competition for growth, which means the U.S. has to constantly ask itself what other countries are doing well and how it might adapt — looking, for example, at what other countries are doing with their corporate tax rates or their health care systems and asking why and where we fall short. Americans have long resisted such an approach, but if someone else is doing tax policy, tort litigation, health care or anything else better, we have to ask why.

There are things the U.S. does well. Most new jobs in America are created by start-ups and small companies, so the ease of doing business is crucial — and there's good news there. The World Bank has a ranking of countries measured by the "ease of doing business," and the U.S. is No. 4. That's very good, but there's a catch. Those rankings are divided into several categories. In most, like "starting a business," the U.S. does well. But in one category it's only 61st in the world, and that is "paying taxes." (See six year-end tax tips.)

The American tax code is a monstrosity, cumbersome and inefficient. It is 16,000 pages long and riddled with exemptions and loopholes, specific favors to special interests. As such, it represents the deep, institutionalized corruption at the heart of the American political process, in which it is now considered routine to buy a member of Congress's support for a particular, narrow provision that will be advantageous for your business.

Martin Wolf: US Victory in Currency War Assured*

[Do notice the asterisk in the title for I'll have more on it towards the end of the post.] It seems the FT's Martin Wolf is continuing a line of argument that began with his book Fixing Global Finance. In it, he ascribes more blame for the global financial crisis on developing countries which do not necessarily subscribe to the whole neoliberal package including unfettered capital flows and more or less market determination of exchange rates. Is it really a North-South conflict over currency practices? For what it's worth, consider that the Japanese are now chiding South Korea and China over currency intervention in the run-up to the Seoul G20. While this strikes me as a bit rich since the BoJ recently went back into the currency markets after being absent for six long years, their authorities dubiously claim that their action was not really meant to influence the USD/JPY level but to temper excess volatility. Well, whatever.

Let's now turn to those Americans who are about to drop tonnes of dollars from the skies via renewed helicopter-dropping [1, 2]. Martin Wolf's new argument is a simple one in the context of Guido Mantega's so-called international currency war: You cannot "defeat" the US in this battle since its ammunition is infinite. A lot of dead trees + the printing press = unlimited dollar emissions to overcome the most determined foe of quantitative easing part two (I'd call it "QE2" if that acronym weren't already taken). And so Wolf goes...

To put it crudely, the US wants to inflate the rest of the world, while the latter is trying to deflate the US. The US must win, since it has infinite ammunition: there is no limit to the dollars the Federal Reserve can create. What needs to be discussed is the terms of the world’s surrender: the needed changes in nominal exchange rates and domestic policies around the world...

In short, US policymakers will do whatever is required to avoid deflation. Indeed, the Fed will keep going until the US is satisfactorily reflated. What that effort does to the rest of the world is not its concern.

The global consequences are evident: the policy will raise prices of long-term assets and encourage capital to flow into countries with less expansionary monetary policies (such as Switzerland) or higher returns (such as emerging economies). This is what is happening. The Washington-based Institute for International Finance forecasts net inflows of capital from abroad into emerging economies of more than $800bn in 2010 and 2011. It also forecasts massive intervention by recipients of this capital, albeit at a falling rate.

Recipients of the capital inflow, be they advanced or emerging countries, face uncomfortable choices: let the exchange rate appreciate, so impairing external competitiveness; intervene in currency markets, so accumulating unwanted dollars, threatening domestic monetary stability and impairing external competitiveness; or curb the capital inflow, via taxes and controls. Historically, governments have chosen combinations of all three. That will be the case this time, too.

Naturally, one could imagine an opposite course. Indeed, China objects to the huge US fiscal deficits and unconventional monetary policies. China is also determined to keep inflation down at home and limit the appreciation of its currency. The implication of this policy is clear: adjustments in real exchange rates should occur via falling US domestic prices. China wants to impose a deflationary adjustment on the US, just as Germany is doing to Greece. This is not going to happen. Nor would it be in China’s interest if it did. As a creditor, it would enjoy an increase in the real value of its claims on the US. But US deflation would threaten a world slump.

Wolf ends on kind of a flat note by stating the need for some sort of cooperation to forestall every country for itself kind of behaviour. What remains odd, however, is Wolf's reluctance to criticize America for running the printing press at full tilt. In other words, the most selfish behaviour is that of the US but he refuses to acknowledge it but sees it instead as an inevitability:

Prof Blanchard is clearly right: the adjustments ahead are going to be very difficult; and they have also hardly begun. Instead of co-operation on adjustment of exchange rates and the external account, the US is seeking to impose its will, via the printing press. The US is going to win this war, one way or the other: it will either inflate the rest of the world or force their nominal exchange rates up against the dollar. Unfortunately, the impact will also be higgledy piggledy, with the less protected economies (such as Brazil or South Africa) forced to adjust and others, protected by exchange controls (such as China), able to manage the adjustment better.

It would be far better for everybody to seek a co-operative outcome. Maybe the leaders of the group of 20 will even be able to use their “mutual assessment process” to achieve just that. Their November summit in Seoul is the opportunity. Of the need there can be no doubt. Of the will, the doubts are many. In the worst of the crisis, leaders hung together. Now, the Fed is about to hang them all separately.

Way to go America; we really appreciate it ;-) And now we get to the asterisk: I do think China still has a longer-term solution in establishing the use of its own currency as an alternative vehicle currency for international trade. It is already experimenting with dollar swaps with some trading partners to settle trade in RMB. Should these small-scale experiments prove tenable, we may eventually see moves towards a freely traded yuan and, as a consequence, more market determination of its exchange rate:

The funny thing is that Martin Wolf ultimately paints a similar scenario in Fixing Global Finance. On p. 181 according to my library copy, he too envisions the creation of a "yuan bloc" as a linchpin of a regional currency unit:

An alternative is regional pegging on a core currency within a more general float. That is what happened in Europe during the era of the European Monetary System. The Americas have a natural anchor currency in the dollar. In East Asia, however, no dominant currency exists, with the dollar, renminbi, and yen all important. The likelihood is a shift from targeting of the dollar to targeting of the renminbi. That should happen automatically over the next two decades, provided China abolishes exchange controls. A de facto currency area is then likely to emerge in that region, focused on the renminbi. But first the renminbi would need to become more flexible. At present both the yen and renminbi are instead targeted toward the dollar, making the dollar the region’s anchor currency.

I hope I live to see the day when we are liberated from the dollar's odoriferous stench of putrefying American decay. When it comes to talk about hanging, there is no doubt in my mind as to who the dead meat is. It's time for China, in tandem with Asian countries, to work themselves free of such economolestation. If that eventuality is hastened, well, perhaps it's worth turning the rest of the world off America even more.

US Elections: Win Votes With China Scare Stories

Or so they think. In the video game Fallout 3 I wrote about during Christmastime when I have time and hardware to actually play video games, there is a scenario of "Chinese Invasion" in which the Red Army takes over a seemingly idyllic suburban American town. It's all quite tongue-in-cheek since, unlike the Guantanamo Ghraibers, the Chinese do not have a history of colonial expansion. Fast-forwarding these prosaically whitebread fears to today, I just wanted to point your attention to the latest fad in American politics with midterm elections coming up; perhaps an inevitable one of painting electoral opponents as being too cosy with the reds. It's so very McCarthyite, dahling, except the commies in question are Chinese not Russian and are more state capitalist than command economy:

With many Americans seized by anxiety about the country’s economic decline, candidates from both political parties have suddenly found a new villain to run against: China. From the marquee battle between Senator Barbara Boxer and Carly Fiorina in California to the House contests in rural New York, Democrats and Republicans are blaming one another for allowing the export of jobs to its economic rival. In the past week or so, at least 29 candidates have unveiled advertisements suggesting that their opponents have been too sympathetic to China and, as a result, Americans have suffered. The ads are striking not only in their volume but also in their pointed language.

The ads are striking not only in their volume but also in their pointed language. One ad for an Ohio congressman, Zack Space, accuses his Republican opponent, Bob Gibbs, of supporting free-trade policies that sent Ohioans’ jobs to China. As a giant dragon appears on the screen, the narrator sarcastically thanks the Republican: “As they say in China, xie xie Mr. Gibbs!”

In an ad featuring Chinese music and a photo of Chairman Mao, Spike Maynard, a Republican challenger in West Virginia, charges that Representative Nick Rahall supported a bill creating wind-turbine jobs in China. And on Wednesday, Senator Harry Reid, the majority leader, began showing an ad that wove pictures of Chinese factory workers with criticism that Republican Sharron Angle was “a foreign worker’s best friend” for supporting corporate tax breaks that led to outsourcing to China and India.

The barrage of ads, expected to total in the tens of millions of dollars, is occurring as politicians are struggling to address voters’ most pressing and stubborn concern: the lack of jobs. “China is a really easy scapegoat,” said Erika Franklin Fowler, a political science professor at Wesleyan University who is director of the Wesleyan Media Project, which tracks political advertising.

Polls show that not only are Americans increasingly worried that the United States will have a lesser role in the years ahead; they are more and more convinced that China will dominate. In a Pew poll conducted in April, 41 percent of Americans said China was the world’s leading economic power, slightly more than those who named the United States.

The story linked to above has more fun factoids alike the 19 Democrat and 10 Republican candidates airing anti-China ads. At least more Yanks know their inevitable place in the global pecking order given current dynamics of a country headed for ruin at warp speed. It's so typical of your modern-day American: make excuses instead of doing something constructive. Meanwhile, you'd better get down on your knees and see if there are reds under the bed. With Christmas approaching, I can't wait to play Fallout 3 again. Unlike many, I try to separate fact from fiction.

"I've Kent Right!" US vs Singaporean Education

America is the only nation in history which miraculously has gone directly from barbarism to degeneration without the usual interval of civilization - Georges Clemenceau

[NOTE: This is the second of two posts on Singapore and the United States.] Blogging is truly rewarding nowadays as the United States is receiving its proper comeuppance for severe indiscipline on a daily basis. It's good to be vindicated. In the end, it doesn't matter who you are; you eventually reap the misery that you sow. Here, though, I would like to focus on the state of education in the United States as it captures a poignant picture of American decay. I've been meaning to post this for quite some time, but a new report arrived to bolster the argument that US education is headed down the tubes like the rest of it.

Deficit fetishists will of course suggest that chronic budgetary shortfalls don't matter. However, with nearly all US states on the brink of financial ruin, it is no surprise that schoolteachers are facing the axe lest the federal government ante up more debt to dump on future generations in typical American fashion. Yet, the damning thing is that lawmakers are not trying to improve the US educational system but to stem further declines. For, the state of US education is in a truly sad state.

The first shoe to drop came about this same time last year. It was reported that average scores on the Scholastic Aptitude Test (SAT), a test required many colleges to gauge the ability of high school finishers to study at the tertiary level, fell after several years of stagnation:

High-school students' performance last year on the SAT college-entrance exam fell slightly, and the score gap generally widened between lower-performing minority groups and white and Asian-American students, raising questions about the effectiveness of national education reform efforts.

Average scores for the class of 2009 in critical reading dropped to 501 from 502, in writing to 493 from 494 and held steady in math, at 515. The combined scores are the lowest this decade and reflect stalled performance over the past three years. The reading scores are the worst since 1994.

Many observers Tuesday viewed the flat results of recent years as discouraging in light of a more than 25-year effort to improve U.S. education. "This is a nearly unrelenting tale of woe and disappointment," said Chester E. Finn Jr., president of the Thomas B. Fordham Institute, a Washington, D.C., think tank. "If there's any good news here, I can't find it."

Good job, America. What's this, "All Children (Except Asians) Left Behind"? Certainly, it looks like things are getting worse in an already highly racialized and inequitable society. I am particularly baffled by the excuse that inclusion of more Latino test takers resulting in lower scores is encouraging just because they're taking SATs. Given impending demographic trends in America, raising their scores should be a priority. If these numbers weren't bad enough already, more recent scores from the American Collegiate Test (ACT) depict an even more despairing result. Insofar as many high school graduates are required to take ACT instead of those just aspiring to go to college, ACT may be more representative:

"High schools are the downfall of American school reform," said Jack Jennings, president of the Center on Education Policy, a nonpartisan research organization in Washington. "We haven't figured out how to improve them on a broad scope and if our kids aren't dropping out physically, they are dropping out mentally."

President Barack Obama has said the nation's long-term prosperity depends on fixing the nation's high schools and preparing students to compete in a global economy. A recent study [by the OECD] found the U.S. ranks only 12th in the percentage of adults aged 25 to 34 who hold college degrees, and Mr. Obama has set a goal of becoming No. 1.

To accomplish its aims, the administration will need to finesse the co-operation of the powerful teacher's unions, Congress, parents and local school officials—groups that aren't always on the same page when it comes to education reform...The average ACT composite score has actually fallen since 2007, after increasing during the five-year period before that. This year, the average composite was 21.0, compared with 21.1 last year and 21.2 in 2007. The test is scored on a 1-36 point scale [my emphasis].

So far so bad, but that's not surprising at all given the subject matter here. What can we offer in contrast to this utterly predictable tale of woe? I humbly suggest that America's leaders look towards educationally progressive Singapore. Sometime ago, Tom Davenport of the Harvard Business Review blog thought that the city-state was a model of judgment for the US. Unlike America, Singapore places a high value on education and actually does something about it:

Singapore is obsessed with education — not just for children, but throughout life. Another of its declared challenges is, "How to design job-training programmes and wage supplement schemes for low-income older workers?" The country tops the ranks of educational achievement regularly. While it was once justifiably criticized for emphasizing rote learning, it has introduced programs that encourage creativity.

There will of course be objections that the Singaporean example is not applicable to the United States given the latter's diversity. But guess what? Singapore is also a melting pot of Chinese, Malay, Indian, and other cultures. Instead of wasting time on Islamophobia and similar bigotries, Singaporeans have laboured to create a truly multicultural society:

Singapore is a highly diverse society, with lots of citizens with Chinese, Malay, Indian, and Arab backgrounds. Yet they all seem to get along pretty well, and the country's culture is greatly enriched by the diversity. Public housing is ethnically and religiously integrated. Other countries could probably use a version of its "Maintenance of Religious Harmony Act," which prohibits religious rabble-rousing.

Take that, Sarah Palin and various Tea Party acolytes.

We all know who successfully patterned their development after Singapore instead of blindly following the example of the US into its current oblivion. Why, for instance, would you want your education system to resemble America's when you could aspire to have one like Singapore's? You can gather even more information on US trashiness till the cows come home but, suffice to say, the evidence clearly points to widespread American decay: It certainly isn't getting any smarter (see above), fitter, or better off than it was before. Let Singapore show America the way.

Jobless America: Yanquis Should Work Abroad

It's time America faced the honest truth as its sunset years roll on and its megadeficits mount: like with the rest of its tarnished brand, it doesn't produce a whole lot of stuff the rest of the world wants. This fact is evidenced by the latest monthly figures showing an unexpectedly huge rise in the trade deficit. Despite the US "economy" being little improved since the height of the subprime crisis, the borrow-and-spend nation managed to pile up a nearly $50 billion deficit in June. Exports are contracting, not expanding; so much for Obamanite delusions about doubling exports in five years. Expect a massive downgrade to the (scarcely believable) advance estimate GDP figure of 2.4% annualized in Q2 2010 due to an again ballooning trade deficit.Instead, the wheels are truly coming off this directionless wagon. Truly, the sun has set on Pax Americana as very few will disagree when I say that its best years are well past it.

At the same time, there is an interesting article in the Wall Street Journal about how many vacancies there are in America despite such high unemployment rates. Apparently, there is a sizeable mismatch between skills needed to fill high-skilled manufacturing jobs in industries that may actually raise American export competitiveness and what is available in the job market. So, what you have left is a lot of middle-of-the-roaders whose training and preferences lie in useless fields like that I'm in where punters are a dime a dozen. (Ouch, the truth sure hurts!)

Facing this situation of jobless America, the obvious response would be to send more people to work abroad. Migration is a fact of life in many other countries, and even in the US itself people move to different states all the time. Still, the Yanquis are famously incurious about the rest of the world. In comparison to here in the UK where 71% of folks have a passport, only 22% of Americans do. Even in the fairly esoteric part of the blogosphere I ply my trade in, you will notice that a lot of concerns are domestic ones of interest mainly to whitebread audiences. Indeed, it may be a fair characterization to say that much US scholarship in international politics is often Just a Bunch of White People Talking to Each Other at US Universities and Calling It International.

In general, we have two stubborn facts: there are few jobs available in America, and the few that exist Americans either aren't trained for or do not have the skills to fill. I was thus struck by how these parochial preferences play out via the example of the Dubai-based carrier Emirates trying to hold job fairs in the US. Likely unknown to the vast majority of Americans only familiar with their crappy domestic carriers featuring antiquated planes, poor service, and massive government support since they can't hack it in the real world, Emirates is growing by leaps and bounds and even helps the US economy by ordering a whole lot of Boeing 777s.

Now, you don't have to be a rocket scientist to ply orange juice and crackers at 30000 feet, but still, amazingly few Americans tried to fill these jobs:

At Emirates, four cabin-crew job fairs the airline held in Miami, Houston, San Francisco and Seattle attracted an average of about 50 people each, compared to a global average of about 150 and as many as 1,000 at some events in Europe and Asia. "I would have liked to have seen more and would have expected to see more," says Rick Helliwell, vice president of recruitment.

The jobs require little more than a high-school diploma and fluency in English. They include free accommodation and medical care, and starting pay of about $30,000 a year. Mr. Helliwell speculates that Americans might be hesitant to move to Dubai, where the jobs are based. "Maybe they have less of an adventurous spirit" given the uncertainties they face at home, he said.

I can think of any number of reasons Yanquis aren't filling these posts: Palin-style Islamophobia, reluctance to leave the homeland, and snootiness about working as a flight attendant among other things. Sooner or later, though, reality will hit these folks--many of whom are perpetually on the dole: the American dream is a hopeless fraud. Some make it big in America, but for the vast majority, it is currently a land of next to no opportunity.

Something the whitebread commentariat routinely misses is that America's population is still growing with a replacement rate slightly north of 2.1 births per woman. By comparison, most of that in Europe (and Japan) isn't growing at a similar clip. Less population to support = less pressure to create new jobs. While this fact may augur well during normal times, at the present it simply means more to care for by more of those who can't find jobs. Short of an American one-child policy--something the US should seriously consider given its pathetic state of affairs--the solution lies abroad. Go East, young Yanqui, go East--and get a passport fer cryin' out loud.

UPDATE: As an example of limited American perspectives, this otherwise readable piece from the Atlantic on jobless America doesn't talk about work opportunities abroad.

PRC Regional Hegemony and the New Silk Road

As if we needed more proof that China has a real "mind behind" what is doing compared to certain relatively clueless imperialists descending into fiscal decay, here comes another piece in the puzzle. Something I've learned from our Chinese colleagues is the importance they place on infrastructure development. From Africa to the Middle East, they are building things that last, not empires of subprime junk (securities). It's something that Americans have never really furnished to others out of the goodness of their hearts. Heck, you can argue America's transportation infrastructure is becoming increasingly decrepit along with the rest of its lot as its budgetary woes enter the stratosphere. If the United States--increasingly paranoid after 9/11--jams entry points from NAFTA "partners" Canada and Mexico, what more to Latin America?

In contrast, China is acting like a good neighbour to many of its surrounding countries, albeit with geostrategic imperatives always in mind. Hearkening back to the Silk Road of yore, plans are afoot to link up the region terrestrially (and, in the process, limit a certain navally dominant imperator from jamming sea lanes if push ever comes to shove). Let us begin with an article which appeared some months ago in the Independent:

High-speed rail is the only way to travel in China these days, with bullet trains zipping along thousands of miles of track at speeds of up to 220 miles an hour. Now China is planning a new Iron Silk Road to link it with 17 countries in central and southeast Asia, using the same state-of-the-art technology.

Imagine the spectacular train ride from Shanghai to Singapore via Rangoon [Yangon]; or from Kunming in south-western Yunnan province to New Delhi, Lahore and on to Tehran. You could board at Harbin at China's border with Russia in Heilongjiang province, and embark on an epic voyage to eastern and southern Europe via Russia...

Nations along the three planned routes are being offered all kinds of lures to agree to the high-speed lines. Cash-poor Burma's high-speed rail network is being built in exchange for raw materials for export to China, such as lithium. Central Asian economies that pump gas and oil to China are also being given financial assistance.

Eventually the plan is to board the train in London and arrive in Beijing two days later, having passed through Germany, Kazakhstan and Xinjiang province. Wang Mengshu, a rail consultant and member of the prestigious Chinese Academy of Engineering, predicts the London route will be ready by 2025...

The technology has been developed with plenty of input from foreign rail companies, and Chinese engineers readily admit that its bullet trains and rail lines have "absorbed" many ideas from the West. But China has been speedy in getting the technology to work, and this success is what they hope will translate well abroad. Chinese companies are building high-speed lines in Turkey and Venezuela, and are soon to bid for contracts in the US. Like China's burgeoning influence, the Silk Road could soon extend around the globe.

Indeed, TIME has a more recent article suggesting that America is already well behind China in terms of railway infrastructure. As China plies its newfound rail engineering expertise for commercial gain abroad, one of its potential clients is (surprise) the land of Amcrap, I mean, Amtrak:

There is, however, the possibility that China could cushion the risk by exporting its rail expertise. State media report that Beijing wants to expand high-speed rail to more than a dozen Asian nations, eventually building a high-speed grid that would link China to Europe. Already, Chinese firms have begun to win key rail projects overseas. Last year, Saudi Arabia awarded the $1.8 billion first phase of a high-speed rail link between Mecca and Medina to a consortium that includes the state-owned China Railway Construction Corporation. Chinese companies are building high-speed-rail projects in Venezuela and Turkey, and the Ministry of Railways is even organizing a Chinese bid for California's proposed $45 billion project to build a high-speed-rail network linking the southern and northern parts of the state.

The American train system could certainly use a boost. It now has just one high-speed line in operation, Amtrak's Acela Express between Boston and Washington, D.C., which averages a measly 116 km/h. That laggardness isn't lost on ordinary Chinese. "Chinese trains have gotten so much better," says Xu Wenhong, a 55-year-old schoolteacher traveling on the train from Hangzhou to Beijing to see his newborn granddaughter. "Now even the U.S. is thinking of buying them." He smiles with satisfaction as we speed into the future at 200 km/h.

In infrastructure terms, think of America as a big pothole on the world map; it's pretty much shot (as if that weren't obvious). Let China show us the way as it reincarnates the Silk Road.