Economist 8/6/15

  1. AS A feat of brawn it is impressive. In just one year, a third of the time engineers wanted, Egypt has shifted enough sand to allow more and bigger ships to pass more swiftly through Suez Canal. Small wonder his government declared a holiday for the lavish opening on August 6th of the New Suez Canal.In economic terms, however, the expansion of the Suez Canal is a questionable endeavour at a time when the government is struggling to provide adequate services to its citizens. True, the channel is a significant source of revenue. Last year it pumped $5.5 billion into an economy weakened by years of turmoil. But both this sum and the number of ships transiting the canal have been flat since 2008.Egyptian officials claim that the $8.2 billion project, which expands capacity to 97 ships per day, will more than double annual revenues to some $13.5 billion by 2023. That, however, would require yearly growth of some 10%, a rosy projection given that in the entire period from 2000 to 2013 world seaborne shipping grew by just 37%, according to UNCTAD.One clear plus for the debt-strapped Egyptian government is that the project is domestically financed: thousands of Egyptians last year snapped up nearly $9 billion in special investment certificates paying 12% interest.
  2. THE first televised debate among the Republican candidates for president takes place in Cleveland on the evening of August 6th. Fox News is broadcasting the event, which, in a crowded field of runners, it has limited to ten participants based on their standing in the polls. Chris Christie and John Kasich just about made the cut, but Rick Perry, Bobby Jindal, Rick Santorum and the rest will have to settle for taking part in a separate televised meeting (dubbed by some as the losers’ forum) that will precede the big show. The debate is the first big opportunity for the candidates to present themselves on a national stage.
  3. Over the past quarter of a century, the maternal-mortality rate has been creeping back up. In 2013 more than 18 women died for every 100,000 live births. America is one of only eight countries, including Afghanistan and South Sudan, where these numbers are moving in the wrong direction.The shortest answer is that no one really knows. Some speculate that it has to do with the fact that American women tend to be both fatter and older when they become pregnant these days. Indeed the risks associated with childbirth rise in tandem with weight and age. But these trends can be seen in plenty of countries where the death rates are still coming down. Others suggest optimistically that America is simply more rigorous about counting these deaths. The most compelling explanation is that more women are in poorer health when they get pregnant, and then failing to get proper care. Chronic health problems, such as obesity, hypertension, diabetes and heart disease, are increasingly common among pregnant American women, and each of them makes delivery more dangerous.These conditions are more common among African-American women, which partly explains why they are nearly four times more likely to die from pregnancy-related complications than white women.
  4. Patents are supposed to spread knowledge, by obliging holders to lay out their innovation for all to see; they often fail, because patent-lawyers are masters of obfuscation. Instead, the system has created a parasitic ecology of trolls and defensive patent-holders, who aim to block innovation, or at least to stand in its way unless they can grab a share of the spoils. An early study found that newcomers to the semiconductor business had to buy licences from incumbents for as much as $200m.Patents should spur bursts of innovation; instead, they are used to lock in incumbents’ advantages. Studies have found that 40-90% of patents are never exploited or licensed out by their owners.
  5. Patents should come with a blunt “use it or lose it” rule, so that they expire if the invention is not brought to market. Patents should also be easier to challenge without the expense of a full-blown court case. The burden of proof for overturning a patent in court should be lowered.The requirement for ideas to be “non-obvious” must be strengthened. Apple should not be granted patents on rectangular tablets with rounded corners; Twitter does not deserve a patent on its pull-to-refresh feed.Patents also last too long. Protection for 20 years might make sense in the pharmaceutical industry, because to test a drug and bring it to market can take more than a decade. But in industries like information technology, the time from brain wave to production line, or line of code, is much shorter

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s