Goverment Planning Destroys Poor People’s Chance to Develop Themselves: More on Why Africa is Poor

  The refuse from homes demolished by the Abuja city government as part of their master plan.  Source of photo:    online version of the NYT article cited below. 

 

The story below, alas, is not an isolated example.  The lessons from Hernando de Soto’s The Other Path, have still not been learned. 

 

“They don’t want to see the common man, the poor man,” said Comrade Daniel, a motorcycle taxi driver, standing in the rubble of his neighborhood.  He lost first his home and then his livelihood to a recent campaign to rid this stately capital of the blemishes of poverty.  “They only care for themselves,” he said.

Mr. Daniel and others who live on the unruly edge of this tidy city in the mossy hills of central Nigeria say that Abuja has declared war on its poorest citizens.

. . .  

. . .  the city’s master plan was ignored for years by corrupt officials who allowed illegal neighborhoods to blossom, unauthorized street markets to spread and torpedo-like motorcycle taxis, called okada, often driven by illiterate young men, to choke the streets.

Much of that expansion was sanctioned — or at least overlooked — by the rulers of the day, and deeds were obtained by many of those who have lost their homes in the recent cleanup.  Mr. Daniel, the motorcycle taxi driver, had a deed to his land, having paid about $160 for a small plot.

In 2003, a new minister was appointed to run the capital, and he declared his intention to hew strictly to the old master plan.  Many political leaders cheered the decision, fretting that Abuja, built at enormous expense as an antidote to Lagos, was headed to the same chaotic fate.

But the declaration effectively rendered much of the daily life of millions of people illegal.  As with most Africans, Nigerians deal mostly in the informal economy, the vast, unregulated, untaxed network that emerges, through the inexorable logic of the marketplace, to fill vital needs left unmet by government and the formal economy.

. . .

The master plan’s housing estates unfurl with the orderliness of a planned subdivision:  town houses and apartments for the well heeled, tract homes and villas for the even better heeled.  But there is little provision for the army of civil servants, whose low wages place the graceful homes of Abuja out of reach.

As for the maids, drivers, security guards and laborers without whom this city would cease to function — people like Mr. Daniel and his sister — there is no place for them at all.  Many have moved farther still, commuting for hours from neighboring states to escape the bulldozers.

The government has said it plans to help resettle those displaced by the demolition, estimated to be in the tens of thousands, but those who have lost their homes say no one has offered them any compensation or a new place to live.  And so they are left with the bitter knowledge that their capital has no place for them.

With their home reduced to rubble, Vashti and Comrade Daniel have moved into the back room of a cousin’s house.  The house they lost was not some tin shack, but a proper house of bricks and mortar.  Mr. Daniel’s income has been slashed by two-thirds by the ban on okada, and he does not know how he will rebuild.

“They say they want to make Abuja like London, but London wasn’t built in a day,” he said.  “Once upon a time they had poor people in London, but they developed themselves.  We just want that chance.”

 

For the full story, see:

LYDIA POLGREEN.  "ABUJA JOURNAL; In a Dream City, a Nightmare for the Common Man."  The New York Times  (Weds., December 13, 2006):  A4.

(Note:  ellipses added.)

 

The reference to de Soto’s book is:

Soto, Hernando de. The Other Path. New York: Harper and Row, 1989.

 

  "Okada" are the motorcycle taxis that the city government of Abuja is trying to ban.  Source of photo:  online version of the NYT article cited above.

 NigeriaMap.gif   Source of map:  online version of the NYT article cited above.

 

Publishing Pretty Papers Full of Clever Mathematical Tricks

  Source of book image:  http://images.amazon.com/images/P/0738203491.01.LZZZZZZZ.jpg

 

In his elegant and thoughtful foreward, physicist, futurist, and guru Freeman Dyson writes:

(p. viii)  Before I met Feynman, I had published a number of mathematical papers, full of clever tricks but totally lacking in im-(p. ix)portance.  When I met Feynman, I knew at once that I had entered another world.  He was not interested in publishing pretty papers.  He was struggling, more intensely than I had ever seen anyone struggle, to understand the workings of nature by rebuilding physics from the bottom up.   

 

The reference to the book, is:

Feynman, Richard P. The Pleasure of Finding Things Out: The Best Short Works of Richard P. Feynman. New York: Perseus Books, 1999.

Schumpeter’s “Sarcastic Remark” on Mathematics in Economics

Erich Schneider had been a student of Schumpeter’s at the University of Bonn in the late 1920s.  The following sentences are from his lectures on Schumpeter that he published in German in 1970, and that were were translated into English by W.E. Kuhn and published in that form in 1975.

(p. 41) When, after many years of separation, I saw Schumpeter again at Harvard in the fall of 1949 and heard his lectures on economic theory–which he gave at 2 p.m., as in Bonn–I found him to be exactly the same man as before. On that afternoon he talked about the nature of dynamic analysis and about the role of difference equations in the framework of such an analysis.

To the above passage, Schneider adds footnote 3:

(p. 59) He dropped the sarcastic remark: "There are economists who do not know what a difference equation is; but there are also those who know nothing else."

Schneider, Erich.  Joseph A. Schumpeter:  Leben Und Werk Eines Grossen Sozialokonomen (Life and Work of a Great Social Scientist). Lincoln, Neb.:  University of Nebraska–Lincoln Bureau of Business Research, 1975.

Environmentalists Back Biofuels that Cause Deforestation

  Forests are burned on plantations in Indonesia to clear land to produce palm oil which is "a key ingredient in biodiesel."  Source of caption quote and photo:  online version of WSJ article cited below.

 

(p. A1)  PONTIANAK, Indonesia — Investors are pouring billions of dollars into "renewable" energy sources such as ethanol, biodiesel and solar power that promise to reduce the world’s reliance on petroleum.  But exploiting these alternatives may produce unintended environmental and economic consequences that offset the expected benefits.

Here on the island of Borneo, a thick haze often encloses this city of 500,000 people.  The cause:  forest fires that have blazed across the island.  Many of them were set to clear land to produce palm oil — a key ingredient in biodiesel, a clean-burning diesel fuel alternative.

The bluish smoke is at times so dense that it leaves the city dark and gloomy even at midday.  The haze has sometimes closed Pontianak’s airport and prompted local volunteers to distribute face-masks on city streets.  From July through mid-October, Indonesian health officials reported 28,762 smog-related cases of respiratory illness across the country.

"I feel it in my breath when I breathe," said Imanuel Patasik, a 26-year-old delivery man, as he sat in one of Pontianak’s many open-air coffee shops on a recent evening.  When the smoke is really bad, he wears a mask to work, but still wakes up the next morning feeling sick.  "It’s part of life here," he sighed.

Seasonal rains have helped quell the fires over the past few weeks.  But the miasma of smoke from Borneo and the island of Sumatra — an annual phenomenon that blankets large parts of Southeast Asia in smog — underscores a troubling dark side of the world’s alternative-energy boom.  Among other problems, the fires in Indonesia spew millions of tons of carbon dioxide and other greenhouse gases into the atmosphere, experts say.  In doing so, they exacerbate the very global-warming concerns biofuels are meant to alleviate.

Such side effects are not an isolated problem.  In Indonesia, Malaysia, Canada and elsewhere, forests are being slashed for new energy-yielding crops or other unconventional fuels.  In India, environmental activists say, water tables are dropping as farmers try to boost production of ethanol-yielding sugar.

 

For the full story, see:

PATRICK BARTA and JANE SPENCER.  "Crude Awakening As Alternative Energy Heats Up, Environmental Concerns Grow Crop of Renewable ‘Biofuels’ Could Have Drawbacks; Fires Across Indonesia Palm-Oil Boom Ignites Debate."  Wall Street Journal  (Tues., December 5, 2006):  A1 & A13.

 

   Midday in Pontianak the smoke haze from palm oil is dense, and causes respiratory problems.  Source of caption quote and photo:  online version of WSJ article cited above.

 

Silicon Graphics’ Jim Clark Understood Disruptive Innovation

There’s a great passage in The New, New Thing about Jim Clark trying to convince Silicon Graphics to produce a PC.  Clark talks about how hard it is for a company to create a product that competes with itself. 

Shades of Clayton Christensen:

 

Clark thought that Silicon Graphics had to "cannibalize" itself.  For a technology company to succeed, he argued, it needed always to be looking to destroy itself.  If it didn’t, someone else would.  "It’s the hardest thing in business to do," he would say.  "Even creating a lower-cost product runs against the grain, because the low-cost products undercut the high-cost, more profitable products."  Everyone in a successful company, from the CEO on down, has a stake in whatever the company is currently selling.  It does not naturally occur to anyone to find a way to undermine that creative destruction, and he was prepared to do the deed.  He wanted Silicon Graphics to operate in the same self-corrosive spirit.  (p. 66 of hb edition)

 

The reference to The New, New Thing is:

Lewis, Michael. The New New Thing: A Silicon Valley Story. New York: W. W. Norton & Company, 2000.

Christensen’s most important book is:

Christensen, Clayton M., and Michael E. Raynor. The Innovator’s Solution: Creating and Sustaining Successful Growth. Boston, MA: Harvard Business School Press, 2003.

“The Referee Should Not Be Too Quick With His Whistle”

I found the following wise comments while reading a short review of an old book by Edgar Monsanto Queeny, who followed his father as CEO of the Monsanto corporation, and who wrote a book called The Spirit of Enterprise which Schumpeter praised in a letter to Queeny.

(The abbreviation T.N.E.C. stands for the Temporary National Economic Committee, which I believe was an ad hoc congressional committee during part of F.D.R.’s presidency.)

Mr. Queeny does not give us a satisfactory analysis of the T.N.E.C. reports but his observations are always commonsensical and suggestive.  What emerges, and what is important, is that the positive Liberal State should not aim at too subtle a plan for freedom.  The referee should not be too quick with his whistle nor too ready to order players off the field.  The rules of the game may well allow for a little hurly-burly.  Economists like Professor Hutt, who are working out the rules of the game of free enterprise, deserve the highest praise.  But they should realize that refinement has its price as well as simplicity, and of the two simplicity costs the less.

Shenfield, A. A. "Review of the Spirit of Enterprise by Edgar M. Queeny." Economica 12, no. 48 (November 1945): 264.

 

The reference to Queeny’s book is:

Queeny, Edgar M. The Spirit of Enterprise. New York: Charles Scribner’s Sons, 1943.

 

Feynman: What Biology Needs is Not More Math, But to See Better at the Atomic Level

A very bright, and very mathematically competent, fellow, grants that math is not the source of all knowledge.  So is economics more like physics, or more like biology? 

 

(p. 124)  We have friends in other fields–in biology, for instance.  We physicists often look at them and say, "You know the reason you fellows are making so little progress?"  (Actually I don’t know any field where they are making more rapid progress than they are in biology today.)  "You should use more mathematics, like we do."  They could answer us–but they’re so polite, so I’ll answer for them:  "What you should do in order for us to make more rapid progress is to make the electron microscope 100 times better."

What are the most central and fundamental problems of biology today?  They are questions like:  What is the sequence of bases in the DNA?  What happens when you have a mutation?  How is the base order in the DNA connected to the order of amino acids in the protein?  What is the structure of the RNA:  is it a single-chain or double-chain, and how is it related in its order of bases to the DNA?  What is (p. 125) the organization of the microsomes?  How are proteins synthesized?  Where does the RNA go?  How does it sit?  Where do the proteins sit?  Where do the amino acids go in?  In photosynthesis, where is the chlorophyll; how is it arranged; where are the carotenoids involved in this thing?  What is the system of the conversion of light into chemical energy?

It is very easy to answer many of these fundamental biological questions; you just look at the thing!  You will see the order of bases in the chain; you will see the structure of the microsome.  Unfortunately, the present microscope sees at a scale which is just a bit too crude.  Make the microscope one hundred times more powerful, and many problems of biology would be made very much easier.  I exaggerate, of course, but the biologists would surely be very thankful to you–and they would prefer that to the criticism that they should use more mathematics.

 

Source:

Feynman, Richard P.  The Pleasure of Finding Things Out: The Best Short Works of Richard P. Feynman.  New York:  Perseus Books, 1999.