Laptops Update Read and Friedman’s “I, Pencil” Story

  Source of graphic:  scanned from p. B1 of NYT article cited below.

 

Leonard Read in his classic "I, Pencil" told the story of how the various compenents of a mere pencil came from different suppliers the world over.  People who did not know each other, and might not like each other if they met, but who were brought together in productive co-operation through the power of the market.  Milton Friedman frequently presented his own verison of this story.  The cover of my 1980 edition of Free to Choose has a picture of Friedman holding a pencil as if in the middle of this story.  And there is a short video-clip of Friedman telling the story.

A similar story could be told with many other products, and several sources have presented the raw materials in print to tell the story for laptop computers.  (By "raw materials" I mean that they list the diversity of sources of the inputs; but usually without drawing all the lessons that Reed and Friedman drew.)  One source is a chapter in Thomas Friedman’s The World is Flat

Two other sources are articles that appeared within a few days of each other in The New York Times and The Wall Street Journal

The reference to The New York Times article is:

DAVID BARBOZA.  "An Unknown Giant Flexes Its Muscles; Amid Talk of Deal With I.B.M., Lenovo of China Sheds Some Obscurity."  The New York Times (Sat., December 4, 2004):  B1 & B3.

The reference to The Wall Street Journal article is:

Jason Dean and Pui-Wing Tam.  "The Laptop Trail; The Modern PC Is a Model Of Hyperefficient Production And Geopolitical Sensitivities."   The Wall Street Journal  (Thurs., June 9, 2005):  B1 & B8. 

 

  Source of graphic:  scanned from p. B1 of WSJ article cited above.

 

Chinese Learn “a Way of Life” from U.S. TV Shows

  Shanghai friends watch downloaded, subtitled, episode of "Friends."  Source of photo:  online version of the NYT article cited below.

 

SHANGHAI, Aug. 8 — For the past year and a half, said Ding Chengtai, a recent university graduate, friends have wondered why he seems to have disappeared.

Mr. Ding, 23, an Internet technology expert for a large Chinese bank, chuckled at the thought.  He has kept himself in virtual seclusion during his off hours, consumed with American television programs like “Lost,” “C.S.I.” and “Close to Home.”

He is no ordinary fan, though; none of the shows he watches can be seen on Chinese television.  Instead, he spends night after night creating Chinese subtitles for American sitcoms and dramas for a mushrooming audience of Chinese viewers who download them from the Internet free through services like BitTorrent.

. . .

To a person, the adapters say they are willing to devote long hours to this effort out of a love for American popular culture.  Many, including Mr. Ding, say they learned English by obsessively watching American movies and television programs.

Others say they pick up useful knowledge about everything from changing fashion and mores to medical science.

“It provides cultural background relating to every aspect of our lives:  politics,  history and human culture,” Mr. Ding said.  “These are the things that make American TV special.  When I first started watching ‘Friends,’ I found the show was full of information about American history and showed how America had rapidly developed.  It’s more interesting than textbooks or other ways of learning.”

On an Internet forum about the downloaded television shows, a poster who used the name Plum Blossom put it another way.

“After watching these shows for some time, I felt the attitudes of some of the characters were beginning to influence me,” the poster wrote.  “It’s hard to describe,  but I think I learned a way of life from some of them.  They are good at simplifying complex problems, which I think has something to do with American culture.”

 

For the full story, see: 

HOWARD W. FRENCH.  "Chinese Tech Buffs Slake Thirst for U.S. TV Shows."  The New York Times  (Weds., August 9, 2006):   A6.

 

Eleven-Year-Old Crippled for Life by Mao Supporters


  Source of book image:  http://www.holtzbrinckpublishers.com/henryholt/Search/SearchBookDisplayLarge.asp?BookKey=1524294


(p. B29) This improbable journey, from Maoist orthodoxy to the entrepreneurial quasicapitalism officially described as “socialism with Chinese characteristics,” is the main theme of “Chinese Lessons,” but Mr. Pomfret, a reporter for The Washington Post, gives his tale a twist.  He tells it not only through his own experiences as a student and journalist but through the life stories of five university classmates, who suffered through the Cultural Revolution as children, found inspiration and hope in the growing democracy movement and lived to see a China that neither they nor their parents could have imagined.  . . .

All the lives Mr. Pomfret explores are extraordinary, and each sheds its own light on recent Chinese history.  Perhaps the most endearing of his characters is Guan Yongxing, better known as Little Guan, who as an 11-year-old suffered social ostracism after accidentally using a piece of paper with “Long Live Chairman Mao!” on it to wipe herself in the bathroom.

After classmates threw her to the ground, no doctor would treat her dislocated shoulder, leaving her crippled for life.  Her father’s job as a schoolteacher made the Guan family a prime target for abuse, and Little Guan, rather than endure ridicule and torment at school, picked cotton and sprayed fertilizer on the fields, her back constantly burned by chemicals leaking from the tank on her back.  Tough, determined and highly intelligent, she survives and eventually prospers in the new China.

. . .

Zhou Lianchun, called Book Idiot Zhou by a contemptuous Communist Party official, meted out insults and torture as part of a Red Guard brigade.  “I did what I was told and, being 11, I liked it,” he tells Mr. Pomfret.

. . .

More even than sex, students want just a little bit of the good life that seems to be in reach as China’s rulers relax their economic policies.  To get it they master a strange kind of doublethink, pledging allegiance to the party and Communist ideals while scheming to start a business.

Book Idiot Zhou, a history teacher by day, jumps into a business partnership to process urine for the pharmaceutical industry.  “Several days a week, he taught Marxism, Leninism and Maoist thought and railed against the exploitation of the capitalist class,” Mr. Pomfret writes.  “The rest of the time he spent as a budding entrepreneur, employing dozens at rock-bottom wages, working the system to enrich himself, his partners and his family.”

. . .

His classmates have done well.  But their lives, and the China described in “Chinese Lessons,” bear a heavy load of suppressed grief, terrible compromises and boundless cynicism.  At a new drive-in called the Happy Auto Movie Palace, Mr. Pomfret notices something strange about the concrete slabs underneath his feet.  They show the marks of tank treads.  The drive-in owner bought them after the government repaved Tiananmen Square.

This strikes Mr. Pomfret as bizarre, but not the owner.  “It was a good deal,” he says.

 

For the full review, see: 

WILLIAM GRIMES. "Books of The Times; Twisting Along China’s Sharp Curves." The New York Times (Fri., August 4, 2006):  B29.
(Note: ellipses added.) 


25% Increase in Oil by 2015

OilPriceGraphic.gif  Source of graphic:  online version of the WSJ article cited below.

 

Despite fears of "running out" of oil, Cambridge Energy Research Associates’ new analysis of oil-industry activity points to a considerable growth in the capacity to produce oil in the years ahead.  Based upon our field-by-field examination of current activity and of 360 new projects that are either underway or very likely, we see capacity growing from its current 89 mbd to 110 mbd by 2015, a 25% increase.  A substantial part of this growth reflects the advance of technology, i.e., the rapid growth in "non-traditional" hydrocarbons, such as from very deep offshore waters, Canadian oil sands, and liquids made from natural gas.  (We are not counting in this increase the additional supplement that will come from ethanol and other fuels made from plants.)

There are important qualifications, however.  First, this is physical capacity to produce, not actual flows, which, as we have seen over the last year, can be disrupted by everything from natural disasters to government decision, to conflict and geopolitical discord.  Second, while prices are going up rapidly, so are costs;  and shortages of equipment and people can slow things down.  Third, greater scale and technical complexity can generate delays.  Still, a 25% increase in physical capacity by 2015 is a reasonable expectation, based upon today’s evidence, and that would go a long way to meeting the growing demand from China, India and other motorizing countries.

Admittedly, it may be hard to conceive of this kind of increase when oil prices are climbing the wall of worry, when each new disruption reverberates around the world, when Iranian politicians threaten $100 or $250 oil in the event of sanctions, and when so many geopolitical trends seem so adverse.  All this underlines the fact that while the challenges below ground are extensive, the looming uncertainties — and risks — remain above ground. 

 

For the full commentary, see:

Daniel Yergin.  "Crisis in the Pipeline."  The Wall Street Journal  (Weds., August 9, 2006):  A10.   

Taking the Red Pill in China

Surfing the Web last fall, a Chinese high-school student who calls himself Zivn noticed something missing.  It was Wikipedia, an online encyclopedia that accepts contributions or edits from users, and that he himself had contributed to.

The Chinese government, in October, had added Wikipedia to a list of Web sites and phrases it blocks from Internet users’ access.  For Zivn, trying to surf this and many other Web sites, including the BBC’s Chinese-language news service, brought just an error message.  But the 17-year-old had had a taste of that wealth of information and wanted more.  "There were so many lies among the facts, and I could not find where the truth is," he writes in an instant-message interview.

Then some friends told him where to find Freegate, a tiny software program that thwarts the Chinese government’s vast system to limit what its citizens see.  Freegate — by connecting computers inside of China to servers in the U.S. — allows Zivn and others to keep reading and writing to Wikipedia and countless other sites.

Behind Freegate is a North Carolina-based Chinese hacker named Bill Xia.  He calls it his red pill, a reference to the drug in the "Matrix" movies that vaulted unconscious captives of a totalitarian regime into the real world.  Mr. Xia likes to refer to the villainous Agent Smith from the Matrix films, noting that the digital bad guy in sunglasses "guards the Matrix like China’s Public Security Bureau guards the Internet."

. . .

(p. A9)  . . . , with each new version of Freegate — now on its sixth release — the censors "just keep improving and adding more manpower to monitor what we have been doing," Mr. Xia says.  In turn, he and volunteer programmers keep tweaking Freegate.

At first, the software would automatically change its Internet Protocol address — a sort of phone number for a Web site — faster than China could block it.  That worked until September 2002, when China blocked Freegate’s domain name, not just its number, in the Internet phone book.

More than three years later, Mr. Xia is still amazed by the bold move, calling it a "hijacking."  Ultimately he prevailed, however, through a solution he won’t identify for fear of being shut down for good.

Confident in that solution, Mr. Xia continues to send out his red pill, and users like Zivn continue to take it.  The teen credits his cultural and political perspective to a "generation gap" that has come of having access to more information.  "I am just gradually getting used to the truth about the real world," he writes.

 

For the full story, see: 

Geoffrey A. Fowler.  "Chinese Internet Censors Face ‘Hacktivists’ in U.S."  The Wall Street Journal  (Monday, February 13, 2006):  A1 & A9.

Buffett and Gates Should Strengthen Foundations of Free-Market

If Warren Buffett is as serious about doing good with his wealth, as he was in becoming wealthy, he would ponder the Wall Street Journal‘s sage editorial page advice:

We can’t think of two people less in need of our two cents than Messrs. Buffett and Gates.  But since giving free advice is our business, we’d suggest that they put at least a smidgen of their money back into strengthening the foundations of the free-market system that has allowed them to become so fabulously rich.  There’s something to be said for reinvesting in the moral capital of a free society and trying to sustain and export free-enterprise policies.

Capitalism has done very well not just by Mr. Buffett but also by the world’s poor, as several hundred million Chinese and Indians might attest.  African nations in particular need property rights and a rule of law as badly as they need vaccines.  On that score we were encouraged by a report this week that the Gateses thanked Mr. Buffett for his gift by presenting him with a book from their personal library:  Adam Smith’s "The Wealth of Nations."

 

For the full editorial, see:

"Mr. Buffett’s Gift."  The Wall Street Journal  (Weds., June 28, 2006):  A14.

Chinese Central Planning Turns Lake Into Desert

   Tall grass grows where Qingtu Lake used to be; and the desert encroaches on the grass.  Source of image:  online version of the NYT article cited below.

 

(p. A1)  An ever-rising tide of sand has claimed grasslands, ponds, lakes and forests, swallowed whole villages and forced tens of thousands of people to flee as it surges south and threatens to leave this ancient Silk Road greenbelt uninhabitable.

Han Chinese women here cover their heads and faces like Muslims to protect against violent sandstorms.  Farmers dig wells down hundreds of feet.  If they find water, it is often brackish, even poisonous.

Chinese leaders have vowed to protect Minqin and surrounding towns in Gansu Province.  The area divides two deserts, the Badain Jaran and the Tengger, and its precarious state threatens to accelerate the spread of barren wasteland to the heart of China.

The national 937 Project, set up to fight the encroaching desert, estimated in April that 1,500 square miles of land, roughly the size of (p. A14) Rhode Island, is buried each year.  Nearly all of north central China, including Beijing, is at risk.

Expanding deserts and a severe drought are also making this a near-record year for dust storms carried east in the jet stream.  Sand squalls have blanketed Beijing and other northern cities, leaving a stubborn yellow haze in the air and coating roads, buildings, cars and lungs.

. . .

Government-led cultivation, deforestation, irrigation and reclamation almost certainly contributed to the desert’s advance, which began in the 1950’s and the 1960’s, and has accelerated.  Critics warn that some lessons of past engineering fiascoes remained unlearned.

During the ill-fated Great Leap Forward in the late 1950’s, Mao ordered construction of the giant Hongyashan reservoir near Minqin, which diverted the flow of the Shiyang River and runoff from the Qilian Mountains into an irrigation system.  It briefly made Minqin’s farmland fertile enough to grow grain.

But Minqin is a desert oasis that gets almost no rainfall.  The Shiyang and its offshoots had been its ecological lifeline.  With the available water resources monopolized for farming, nearly all other land became a target for the desert.

Today, patches of farmland that cling to irrigation channels are emerald islands in a sea of beige, an agricultural Palm Springs.

Even the irrigated plots risk extinction. Competing reservoirs on upper reaches of the Shiyang reduced its flow so severely by 2004 that the Hongyashan went dry for the first time since its construction in 1959.  It was refilled after Beijing ordered an emergency diversion of water from the Yellow River, which now runs dry through much of the year here in its northern reaches.

Local officials, whose promotions in the government and Communist Party hierarchy depend more on increasing economic output than on improving the environment, have tried desperately to preserve Minqin’s farming.

. . .

"This is not a natural disaster — it is man-made," Mr. Chai said.  "And unless people study the lesson of Minqin, it will repeat itself clear across China." 

 

For the full story, see: 

JOSEPH KAHN.  "A Sea of Sand Is Threatening China’s Heart."  The New York Times (Thurs., June 8, 2006):  A1 & A14.

 

  Women wear headresses and face masks, not out of modesty, but to protect against the sand.  Source of photo:  online versio of the NYT article cited above.

 

ChinaDesertMaps.gif Close, and distant, maps of the areas effected.  Source of maps:  online version of the NYT article cited above.