Economist 3/31/16

1. There have been 1,067 hijackings since 1931, when the first one occurred in Peru. At their peak in the late 1960s, most hijackings were politically or criminally motivated. Some, such as D.B. Cooper, hijacked planes for the money (he famously demanded—and received $200,000).  Many did so to defect from the former Soviet bloc, or to Cuba. But it was the rash of hijackings perpetrated by Middle Eastern militant groups from the late 1960s onward that forced countries to rethink security. More than 130 American planes were hijacked between 1968 and 1972. In the 1970s, the International Civil Aviation Organisation began requiring passengers be screened using metal detectors. Bags also had to be X-rayed. Measures to screen for explosives were implemented later. In 1969 there were 86 hijackings globally. By 1999, the number had dropped to 13. But it took the September 11th attacks to truly change security measures in the United States, in manners now familiar.
2. The  asylum acceptance rate in Europe jumping by ten percentage points to 60% in the final quarter of 2015—the highest rate ever. Belgium, France, Germany and the Netherlands all granted asylum in record numbers.Syrians, Eritreans and Iraqis, who are let in more than 90% of the time, make up almost half of all decisions, up from about a quarter in 2014. For other countries the acceptance rate was just 28%, and there has been no jump.Because violence and repression in their home countries is widely recognized across Europe, they have the highest acceptance rates in the rest of the continent, at 97%, 86% and 90% respectively. Conversely, more than three-quarters of asylum-seekers in Poland are Ukrainians or Russians; other European countries admit them just 36% and 27% of the time.Bulgaria, Sweden, the Netherlands and Cyprus all post overall admission rates above 70%, but fall to within four percentage points of the European average after accounting for the composition of their asylum-seekers. Poland’s recognition rate rises from 18% to 34%.Romania has the lowest adjusted recognition rate, at 15%; this may be because applicants who move on to richer neighbors and skip their assessment interviews are listed as “rejected”. In bankrupt Greece, an underfunded asylum system makes rushed decisions based on inadequate information.
3. On March 29th Tata Steel, Britain’s biggest producer, said it planned to sell or shut down its British operations, prompting growing pleas for a government bail-out. The state of the global steel industry, and Britain’s now-peripheral position in it, mean that those calls should be resisted.Steel production in Britain has more than halved since its peak in around 1970, to some 12m tonnes a year. In 2015 British steelmakers contributed less than 1% of world supply.Most of the increase is accounted for by China, which has more than quadrupled its production since 2000. In 2015 China produced over 800m tonnes, or about half of the global total. But its flagging economy has led state-owned steelmakers to sell their growing surpluses on foreign markets.Any bail-out by the state would run into trouble. The European Commission allows governments to help steelmakers regain competitiveness by, for example, cutting energy taxes. But it bans them from offering aid to rescue or restructure ailing steelmakers.
4. Harvard has an endowment of $36 billion, the largest in the country. Last year it raised more than $1 billion. Some of its alumni think this ought to be sufficient to scrap tuition fees.America’s universities raised a record $40.3 billion last year, according to the Council for Aid to Education. Harvard’s endowment is made up of 13,000 funds and is its largest source of revenue by far. Endowments are not usually used to lower tuition fees, but they can be used to provide scholarships and financial aid to students who cannot afford to pay (70% of students at Harvard get some assistance with fees and living costs).Some lawmakers are wondering whether threats to change the tax-exempt status of endowments might be used to persuade colleges to bring down the cost of tuition.After Congress last examined the topic in 2007, more colleges began to award grants instead of loans. Financial aid has doubled over the past decade.Around 70% of endowments are restricted funds. Not abiding by a donor’s wishes can result in a lawsuit.
5. SIXTEEN years was surely too long for anyone to remain as boss of Spain’s largest telecoms company, Telefónica. During his spell in charge, César Alierta, 70, who at last agreed to hang up his receiver this week, created a giant.Early on he had shown caution: his tenure began with his cleaning up the mess that resulted from Telefónica’s dud investments during the dotcom bubble. Then, like bosses at other big Spanish firms such as Santander, a bank, Mr Alierta was tempted to splurge. Telefónica bought BellSouth’s Latin American mobile operations in 2004; acquired O2, a British telecoms firm, in 2006; and invested in China. By 2007 its market value exceeded €100 billion ($150 billion).As Spain’s fortunes fell, Mr Alierta was forced into retreat, selling investments in Italy, the Czech Republic and Ireland. Last year Telefónica also agreed to sell O2. The firm decided to concentrate on core markets including Germany, where it bought E-plus, a big phone operator, and Brazil, the company’s largest market by sales.Telefónica is not ushering in radical change. Its new boss is likely to be a well-liked and slightly younger insider, José María Álvarez-Pallete

Economist 3/30/16

1. It was recently reported the latest annual ranking of 2015’s most violent cities in the world (excluding war zones) by CCSP-JP, a Mexican NGO. The report placed Caracas, Venezuela’s capital, at the top of a list of 50 cities (with populations of at least 300,000) with the highest homicide rates.Where no official figures exist, CCSP-JP is transparent in its methodology: for Caracas it counted bodies from the city morgue (which covers a larger area than the city itself) between January and August, discounted a percentage attributed to accidental deaths, and extrapolated an amount for the full year to get a rate of 120 homicides per 100,000 people. The approach is obviously open to error and several groups have challenged some of CCSP-JP’s findings. One, the Igarapé Institute—a Brazilian think-tank on security and violence—compiles statistics on murder rates in countries and on more than 2,100 cities with populations of 250,000 or more, compared with the CCSP-JP’s ‘hundreds’.
2. The biggest differences between the two datasets concern Venezuela and El Salvador. Venezuelan data are considered too unreliable and the country is excluded entirely from Igarapé’s list.. The other main difference between the rankings is the number of Brazilian cities: 32 feature here compared with an already substantial 22 in our previous chart.More than 10% of all the world’s homicides are in Brazil, and although the rate has fallen in its largest cities it has started increasing in smaller ones. The violence is borne by its poorer black population: between 2000 and 2014 the murder rate of whites has fallen by 14% but risen by 18% among black people.The broad picture in the rankings is roughly similar, however. Latin American and Caribbean countries suffer disproportionately compared with elsewhere.Only two countries outside the region feature on either chart, South Africa and the United States (the list’s only rich-world country).
3. OMAR SOULEYMAN, a 49-year-old farmer-turned-wedding-singer from north-eastern Syria and a father of 9, is an unlikely electronic music star. This month he drew big crowds to KOKO, one of London’s most iconic music venues.His electro-dabke, an “updated” form of traditional Middle Eastern folk music, has drawn a cult following. Adapted by Kieran Hebden (who goes by the name Four Tet), a British producer, Mr Souleyman’s music seems to satisfy an urge for the exotic among the nouveaux hipsters of England’s capital.His fans argue that Mr Souleyman encourages a cultural curiosity that is hard to achieve through other means.In his favour, Mr Souleyman’s lyrics, which focus on the agony of being in love, portray Syrians as ordinary people with ordinary emotions.Mr Souleyman is fast becoming an idol to vast numbers of European party-goers, and has performed at some of the biggest festivals on the continent. Yet many Syrians have never actually heard of him; among those who have, tastemakers frown upon his mediocre representation of the country’s musical prowess and his kitsch take on one of their oldest traditions
4. Because they spend so much time on the road, business travellers are more desensitised to the threats that international travel can bring. Many will quite logically argue that traffic accidents pose a greater threat than a terrorist act. Less logically, some also convince themselves that their travel savviness gives them a sixth sense that enables them to spot and avoid dangerous situations, an argument that holds little water in the case of random bomb attacks on busy locations.Switching holiday destinations might be considered prudent, but pulling out of a pre-arranged business trip will be viewed less sympathetically by employers. Exceptions are only likely in extreme circumstances. When it comes down to it, business travellers have little choice in where or when they go.
5. GIKOMBA market, just north of Nairobi’s downtown, is a place to buy just about anything.This market is the biggest wholesale centre of the mitumba, or used-clothing, trade in east Africa. The clothes worn by the bulk of Nairobi’s population are sourced here.Yet if the governments of the East African Community, the regional trade bloc which comprises Kenya, Tanzania, Uganda, Rwanda and Burundi, get their way, all will change. By 2019 the EAC wants to outlaw imports of second-hand clothes. The idea is that ending the trade in old clothes—mostly donated by their former owners in rich countries—will help boost local manufacturing. Mitumba trading is a big employer for Kenyans, most of whom work in the informal labour market. By one estimate, there are 65,000 traders in Gikomba alone.. In 2015, according to UN data, Kenya imported about 18,000 tonnes of clothing from Britain alone. Few traders are happy with the idea of a ban. Selling clothes is a relatively lucrative activity.

Economist 3/29/15

1. By April, when the new trans-Kazakh railroad opens fully, Iranian executives hope to have cut the journey time to China, currently its biggest trade partner, to just eight days—a month less than the sea route takes. Should Turkey get on board, the route might even replace the Suez Canal as a primary Chinese and Iranian route to Europe. Within six months, Abbas Akhoundi, Iran’s British-trained transport minister, will open a track to Afghanistan’s mines, and ship minerals to India via a revamped south-eastern port, Chabahar, bypassing Pakistan.Iran also plans to more than double its internal 10,000km rail network over the next decade and replace the rolling stock that trundles at 90kph with high-speed trains on electrified lines.Comfortingly, railways seem to be one sector where reformists and hardliners suspend their infighting. Billboards in Tehran proclaim the Supreme Leader’s passion for trains.
2. The hitch, of course, is finance. In Iran’s sixth five-year plan, now awaiting parliamentary approval, Mr Akhoundi wants to spend $28 billion on railways, $20 billion on roads, $50 billion on upgrading the country’s Shah-era air fleet and $7 billion on airports (including an extension to Tehran’s main airport, Imam Khomeini, so that the largest modern airliners can land there). Yet given the low oil price, his government can barely pay public-sector salaries, let alone fund infrastructure development. So it has been wooing foreign investors instead. It seems to be working.Russia suspects Iran will become a challenger to its dominance of regional markets. And the United Arab Emirates, which backs Saudi Arabia in the region’s sectarian showdown, fears that Iran—with its many tourist attractions—might challenge its role as a global hub.
3. The most recent survey by Latinobarómetro, a Chilean polling firm, found that 65% of respondents (Latin Americans) had a good or very good opinion of the United States. And the countries that seem to have the most cause for grievance feel least aggrieved: the two most pro-American nations in the region are the Dominican Republic (which the United States occupied from 1916 to 1924 and invaded again in 1965) and Guatemala (whose president was toppled in a coup organised by the CIA in 1954).The region-wide view of the United States has oscillated considerably, from a low of 38% approval in 1996 to a high of 74% in 2009. Virtually all of these ups and downs seem to reflect changes in foreign direct investment (FDI) from the United States and changes in Latin American GDP per person. The more that American firms invest in Latin America, and the wealthier its inhabitants grow, the fonder respondents become of the gringos. The next most important factor, unsurprisingly, is remittances, which make up more than 15% of the GDP of El Salvador and Honduras, for example.
4. Airports’ publicly accessible spaces have become a more common target in recent years. In 2007, a jeep packed with explosives was driven into the main entrance to Glasgow airport. In 2011, a suicide bomber killed 37 people in the arrivals hall of Domodedovo Airport in Moscow.After Brussels, some experts have called for greater security at the entrance to airports.But there are problems with that approach. First, it might simply push back the point at which terrorists can strike without being screened.The second problem is cost.There is also a more fundamental problem: nowadays, any large gathering place is a potential terrorist target. It made sense to secure aeroplanes, since they themselves have been used as weapons of mass destruction. But if we start locking down airport entrance halls, we would logically have to move on to train terminals, and bus stations, and concert halls, and public squares, and churches, and schools.
5. Ms McClendon,a curator at the Fashion Institute of Technology (FIT) in New York, argues, persuasively, that much of what Americans think they know about denim draws on a set of “origin myths”, crafted and disseminated by manufacturers over many years, both individually and in campaigns run by the Denim Council, an industry group of clothing-makers and textile mills that was active from 1955-75.Quite a lot of this marketing was hokum, or close to it. There is no evidence that Columbus crossed oceans under billowing denim sails, while the latest research is that the term “denim” may have been invented in England. Perhaps most strikingly, relatively few cowboys wore blue jeans at the height of the Wild West, Ms McClendon says: canvas and leather trousers were also common. Denim was mostly worn by small farmers, field-hands, labourers and miners—some of the oldest pieces in the archives of Levi Strauss & Co. were found in disused mines in California and Nevada.

Economist 3/28/15

1. CityScore, launched last October, reflects a growing trend among city governments in America. Led by Boston, Chicago and New York, they have started to use the ever-increasing amounts of data they collect to improve planning, offer better services and engage citizens.It combines 24 different metrics, from crime to Wi-Fi availability, energy consumption and grants for the arts. A value above 1 means that things are going better than planned.In some ways Boston has been a digital pioneer. In 2006 the previous mayor, Tom Menino, hired the city’s first cabinet-level chief information officer. He was behind the launch of an app called “Citizen Connect” which made it easy for people to report problems, for instance by taking a picture of graffiti.However, this sort of thing is not going to make much difference if the bureaucratic structure of city governments remains the same. Most are collections of departmental silos that do not communicate much with each other, held together by complex hierarchies and rules.
2. Yet the biggest change will be of another order: cities need to play a more active role as broker of urban data.Some cities are beginning to take on this role. An early example is Boston’s data-sharing partnership with Waze on reducing traffic congestion. In return for some of the service’s data, the city is giving it early warning of any planned road closures.In New York the Centre for Urban Science and Progress (CUSP) has launched a project called “Quantified Communities” to work out how people could use data generated by increasing numbers of sensors in their neighbourhoods.Seattle, for its part, has discovered that citizens will insist on stringent protection of privacy. A few years ago it began using a wireless police network that could track smartphones, along with automatic licence-plate readers. The programme was implemented without much public discussion or thought about how the data would be managed. That led to a backlash from residents and a hasty about-turn.The big political question is whether data will simply make city government more efficient—which in itself is a worthwhile goal—or whether they will also empower citizens.
3. IT IS MORE than half a century old, but Mancur Olson’s book, “The Logic of Collective Action”, is still hugely influential. In a nutshell, the late economist argued that large groups of people will organise only if they have some particular incentive: many will simply “free-ride” on the efforts of others.One prominent attempt is a book called “The Logic of Connective Action”, by Lance Bennett and Alexandra Segerberg. The authors contend that when people express views online, they do not need to be part of a formal organisation. By sharing links or posting comments, they are already engaging in political activity. But this diffuse political energy has to be bundled to become effective.None of this refutes Olson’s basic premise that people do not automatically collaborate, even if they have a common interest. But the internet makes such collaboration much easier.
4. Data collected by Moviepilot suggest that since Batman first appeared in feature-length films 50 years ago, Mr Adam West has been the closest in physique to the Gotham crusader as specified in the comic books: 6’2″ (1.88m) tall, and weighing 210 pounds (95kg). Yet few would name Mr West’s portrayal as the best. It is hard not to scoff at his unflattering spandex getup (the moulded Batsuits were only introduced with Michael Keaton’s 1989 version).By contrast, the muscled-up Batman of the Christopher Nolan trilogy—played by Christian Bale—was lauded by critics, despite being a little undersized.Mr Affleck is certainly physically impressive and achieves his goal of looking “like a superhero”, but lumbers around like a human bull in a Gotham china shop. In the past 50 years, Batman has foiled evil plots by using his brain as much, if not more than, his brawn.
5. Political scientists have long pointed out that social media make it easier for interests to organise: they give voice and power to people who have neither.But research into another effect has only just begun: social media are also making politics and collective action more “chaotic”, argues a new book called “Political Turbulence”.Mobilisation often explodes, seemingly at random, according to the authors, most of whom work at the Oxford Internet Institute. Most online petitions, for instance, attract only a small number of supporters. Success does not depend on the subject matter—similar ones often fare quite differently—but the personality of potential participants. Extroverts, for instance, are more likely to act because they are sensitive to “social information”: seeing that others have already signed and knowing that their endorsement will be seen too. As a result, if a petition’s initial audience includes enough people with the right mindset, it can quickly take off

Economist 3/25/16

1. Eradicating a disease is the sort of aim that rich countries come up with, and poor ones struggle to reach. But for some diseases, the pattern is now reversed. These are the ailments for which vaccinations exist. The trend is most obvious for measles, which is so contagious that at least 95% of people must be vaccinated to stop its spread (a threshold known as “herd immunity”). Many poor countries are well above that. Eritrea, Rwanda and Sri Lanka manage to vaccinate almost all children. By contrast several rich countries, including America, Britain, France and Italy, are below herd immunity.Last year Europe missed the target it set itself in 2010 to eliminate measles, with outbreaks in several countries and nearly 4,000 cases.
2. America was declared measles-free in 2000; in 2014 it had hundreds of cases across 27 states and last year saw its first death from the disease in more than a decade. This sorry state of affairs is often blamed on hardline “anti-vaxxers”, parents who refuse all vaccines for their children. They are a motley lot. The Amish in America spurn modern medicine, along with almost everything else invented since the 17th century. Some vegans object to the use of animal-derived products in vaccines’ manufacture. The Protestant Dutch Reformed Church thinks vaccines thwart divine will.In most countries such refuseniks are only 2-3% of parents. But because they tend to live in clusters, they can be the source of outbreaks. A bigger problem, though, is the growing number of parents who delay vaccination, or pick and choose jabs.In America, some poor children miss out on vaccines despite a federal programme to provide the jabs free, since they have no regular relationship with a family doctor. Some outbreaks in eastern Europe have started in communities of Roma (gypsies).There is, however, surprisingly little evidence that tough laws make a big difference to vaccination rates.One promising new approach is to keep track of the vaccine myths circulating in cyberspace and rebut each one as it appears.
3. LAST September Colombia’s president, Juan Manuel Santos, and the leader of the FARC guerrilla army, Rodrigo Londoño, known as Timochenko, said that within six months they would reach a final agreement to end a war that has dragged on for more than half a century.The two men set March 23rd as their deadline.The final areas of negotiation have proven to be trickier than either side had imagined. One of the main sticking points is on how and where the FARC’s 6,500 fighters will gather to begin demobilising. The FARC proposed as many as 60 cantonments (to spread their influence) throughout the country, while the government wants to limit the number to about ten (to ensure proper monitoring). The two sides also disagree on how to ratify the accords. The government wants a plebiscite (as it has promised) whereas the FARC seeks a constitutional change (which would make the FARC’s struggle look more legitimate).Postponing a final deal is prudent, but it will be politically costly.Postponing a final deal is prudent, but it will be politically costly.
4. Electronics firms together contribute 40% of Taiwanese exports, and 15% of its GDP. For more than two decades they have achieved great success assembling computers and other gadgets for Western companies. At first their factories were all in Taiwan, but as China opened up, they shifted some to the mainland. The combination of Taiwanese production expertise and the mainland’s cheap labour was hard to beat.Taiwanese firms fear that rising mainland counterparts, which they call the “red supply chain”, are catching up. Taiwan’s semiconductor firms, such as TSMC, are so far going strong. But its main makers of big display screens, Innolux (which Hon Hai controls) and AU Optronics, are under threat from the mainland’s BOE and China Star Optoelectronics.Of all the countries dependent on purchases by China, Taiwan has most to lose as the mainland’s electronics industry becomes more self-sufficient.

Economist 3/24/16

1. Using America’s five-yearly economic census, The Economist has divided up the American corporate landscape into 893 individual industries: from coffins to credit cards. Between 1997 and 2012 the weighted-average share of the top four firms’ revenues has risen from 26% to 32% of the total. Concentrated industries, in which the top four firms control between a third and two-thirds of the market, have seen their share of revenues rise from 24% to 33% between 1997 and 2012. And just under a tenth of the activity takes place in industries in which the top four firms control two-thirds or more of sales. While concentration does not of itself indicate collusion—America’s regulatory environment acts as a barrier, too—it does suggest that America needs a heavy dose of competition.
2. According to a report by the UN’s Human Rights Council, at least 966 executions are said to have been carried out in 2015 in Iran, one of the highest rates in the world, up from 750 in 2014. Some sources, according to the report, put the figure above 1,000. It notes that 25 people were executed in one day last year in a prison close to Tehran, the capital. It particularly laments the execution of juveniles; at least 16 have been hanged in the past two years for crimes committed when they were under 18.The authorities point out that most of the executions were for drug-related crimes, including armed drug-smuggling. But the council’s report notes that the death penalty can be imposed for minor drug-related offenses, such as possession of only 30 grams of amphetamines. Moreover, a large number of those executed are foreigners, who sometimes have little chance to defend themselves in court, for instance because they lack proper facilities for translation.
3. At least five instances of amputations were cited and three of blinding; in one instance, a left eye and a right ear were surgically removed under the law of qisas, whereby a person can insist that a tit-for-tat punishment be imposed on a wrongdoer to match the original crime.At least 47 political journalists and social-media activists are said to be behind bars, as of January 2016.Among those discriminated against for holding heterodox religious views, the Bahai community continues particularly to suffer.At the end of last year, 80 Bahais were reported to be in prison “solely for their religious beliefs”, including seven leaders arrested in 2008 who are serving ten-year sentences on such charges as espionage, “propaganda against the regime” and “spreading corruption on earth”.The UN report also bemoans restrictions on women. It cites the head of Tehran’s traffic police saying in December last year that in the previous eight months there had been 40,000 cases of women being stopped for “bad hijab”—driving without the required covering of hair. Offenders’ vehicles are often seized and their owners taken to court.
4. COFFEE was once Kenya’s biggest foreign-exchange earner, but these days the industry looks less perky. The country’s record, 127,000-tonne crop was all the way back in the 1987-88 season. Output plunged by 40% the following year.It has been falling ever since: last year it was less than 45,000 tonnes, a mere 0.5% of coffee production worldwide.That is not for lack of quality. Kenya’s arabica coffee, grown in the highlands around Mount Kenya, is world-renowned.For many smallholders, who account for 60% of the country’s coffee production, there just isn’t enough money in beans anymore. Some small farmers have abandoned the crop altogether for vegetables or other, more lucrative export crops, such as macadamia nuts.Coffee production in neighbouring Uganda has more than doubled since 1990, to 285,000 tonnes.In 2010, Kenyan coffee farmers received 20% of the export price of their crop, compared with more than 80% in Uganda.
5. Regulation has left the industry with a Byzantine structure that presents many opportunities for skimming off money. Only 10% of beans are bought directly from farmers. Most smallholders belong to a co-operative, which skins, ferments and dries the coffee beans before passing them on to a miller that finishes the processing and grading. The bags then go to one of eight licensed marketing agents, which sell the coffee to 60 local and international dealers at the Nairobi Coffee Exchange.In Uganda, in contrast, the industry has been completely liberalised since 1992. There are no auctions: middlemen compete vigorously to buy directly from farmers and sell on to exporters.

Economist 3/23/16

1. Globally, one in three higher-education students is in the private sector, according to Daniel Levy, an academic at the State University of New York. In Europe the figure is only one in seven. But the share is set to rise. According to Parthenon-EY, a consultancy, between 2011 and 2013 the number of students enrolled in private higher education grew at a faster rate than those in the public sector.Companies are also turning to private universities, further boosting their growth. IUBH offers a “dual studies” hospitality degree, paid for by hotels, whereby students spend alternate weeks on campus and at work.International students are also swelling the ranks of private providers. There are 4.5m international higher-education students worldwide, a number that is expected to rise to 7m-8m by 2025.America’s State Department wants to double the number of American students abroad from 300,000 to 600,000 by 2020.
2. One problem with American capitalism has been overlooked: a corrosive lack of competition. The naughty secret of American firms is that life at home is much easier: their returns on equity are 40% higher in the United States than they are abroad.High profits might be a sign of brilliant innovations or wise long-term investments, were it not for the fact that they are also suspiciously persistent. A very profitable American firm has an 80% chance of being that way ten years later. In the 1990s the odds were only about 50%.You might think that voters would be happy that their employers are thriving. But if they are not reinvested, or spent by shareholders, high profits can dampen demand. The excess cash generated domestically by American firms beyond their investment budgets is running at $800 billion a year, or 4% of GDP. The tax system encourages them to park foreign profits abroad. Abnormally high profits can worsen inequality if they are the result of persistently high prices or depressed wages.
3. Unfortunately the signs are that incumbent firms are becoming more entrenched, not less. Microsoft is making double the profits it did when antitrust regulators targeted the software firm in 2000.Getting bigger is not the only way to squish competitors. As the mesh of regulation has got denser since the 2007-08 financial crisis, the task of navigating bureaucratic waters has become more central to firms’ success. Lobbying spending has risen by a third in the past decade, to $3 billion.Most of the remedies dangled by politicians to solve America’s economic woes would make things worse. Higher taxes would deter investment. Jumps in minimum wages would discourage hiring.The first step is to take aim at cosseted incumbents. Modernising the antitrust apparatus would help. Mergers that lead to high market share and too much pricing power still need to be policed.The second step is to make life easier for startups and small firms. Concerns about the expansion of red tape and of the regulatory state must be recognised as a problem.
4. BRISTOLIANS think of themselves as different. Theirs was the only city to vote to adopt an elected mayor in a series of plebiscites held in 2012; nine others rejected the idea. The place has its own currency, the Bristol pound, which can be used in local shops and even to pay council tax. And it is unusually prosperous.It has by far the highest productivity of any big conurbation outside London.It also has the highest household income beyond the capital.Much of the city’s prosperity dates back to the slave trade, which accounted for half its income in the 18th century.Even after slavery went away, the bankers did not: today Bristol has one of the highest concentrations of finance jobs in the country.
5. Bristolian companies are particularly inclined to let their staff work from home, suggest data from the Centre for Cities, a think-tank. This helps to explain an exodus from London of working-age folk, particularly those with families: in 2014 one-third more 30- to 50-year-olds moved from London to the Bristol area than vice versa.Bristol’s success is thus partly down to historical and geographical accident, but local officials have also taken some wise decisions. When the city received money to develop an “enterprise zone” offering financial relief to firms, the council located it in the city centre, next to the main train station.But in other ways government has hindered more than it has helped. The lack of joined-up thinking among the four local authorities explains why public transport is so ropy.As for housing, the average Bristol home costs nearly ten times earnings, pricier than in any comparably sized city. Lack of supply is partly to blame. Bristol’s “green belt” of protected land is six times the size of the city, so it is tricky to build new homes: in 2004-14 Bristol’s housing stock grew more slowly than that of inner London.

Economist 3/22/16

1. Hackers masquerading as officials from Bangladesh’s central bank asked the New York branch of the Federal Reserve to transfer nearly $1 billion to private bank accounts in Sri Lanka and the Philippines. By the time authorities cottoned on, $101m had been nicked. On March 15th Atiur Rahman, the governor of Bangladesh’s central bank, took the blame and resigned.The Fed says the instructions it received were legitimate. The Philippine authorities cannot say what happened to the $81m sent to their country. Much of the money disappeared in its opaque casinos, which they say are not covered by rules to prevent money laundering.Even the criminals (of which nothing is known) should kick themselves: were it not for a typo in one of their requests, dozens more payments might have gone through. Staff at the central bank of Sri Lanka, who blocked a $20m onward transfer on the grounds that it was odd for a central bank to be making a big payment to a private account, covered themselves in glory.The attack is hardly an isolated incident. Criminal gangs are adept at hacking into e-mail accounts and sending instructions to bankers asking them to wire large sums.
2. At the moment, calculating America’s consumer-price index (CPI) involves sending people into shops to note down prices. The basket is based on a survey of consumers which is updated only every three years or so. This looks increasingly cumbersome in a world where every online purchase is logged, somewhere, in a database. In theory online baskets and prices, at least, could be tracked digitally.Adobe, a technology firm, is trying to do just that. The firm collects anonymised sales data from websites that use its software.It is using this ocean of information to compile a “digital price index” (DPI) to rival official measures of inflation.The DPI has several advantages over the conventional approach. It tracks 1.4m goods, compared with the CPI’s 80,000. It is based on actual purchases rather than advertised prices, increasing its accuracy.The new index completely misses changes in offline prices and spending on things like petrol and rent. It will not replace the CPI any time soon.
3. UN’s Committee on the Elimination of Discrimination against Women recently concluded that Japan should let women inherit the Chrysanthemum throne, too.It is not clear what Emperor Akihito, who is 82 (and has a hugely popular wife), thinks about this. But the Japanese prime minister blew his top. Shinzo Abe leapt to the defence of a male-only line, saying it was rooted in Japanese history.Cowed, it withdrew its recommendation that the law of succession be changed.Polls suggest that most Japanese would welcome a female monarch.Mr Abe does not share Mr Koizumi’s iconoclasm. An arch-traditionalist, he wants the male-only system preserved to protect the imperial bloodline. But in other ways he has been an unlikely champion of diversity since he came to power (for the second time) in 2012. He has cajoled Japanese firms into promoting more women and urged them to make it easier for them to come back to work after having children.
4. Punjab’s(Pakistan) pushy chief minister, Shahbaz Sharif treats the metro as an urgent priority. His office makes a virtue of the fact that the line will be just a biscuit toss away from some of Lahore’s architectural gems: no better way to study them. The project appals conservationists.Today Lahore has a greater profusion of treasures from the Mughal period (the peak of which was in the 17th century) than India’s Delhi or Agra, even if Lahore’s are less photographed.Conservationists claim law on their side. In January the Lahore High Court granted a stay against the government’s plans, ordering it to stop felling trees and otherwise preparing the ground for the metro. It was argued that building beside at least 11 sites would violate antiquities laws, which forbid construction within 200 metres of a protected area. This week the court gave the advocate-general a deadline of March 21st to make his case against the stay.
5. Indiana’s Republican governor, Michael Pence, has made it clear that refugees from one mostly Muslim country are not welcome in the state. On November 16th, three days after the terrorist attacks in Paris, Mr Pence suspended the resettlement of Syrian refugees “to ensure the safety and security of all Hoosiers”. As many as 30 other Republican governors (and one Democrat)subsequently made similar moves. Mr Pence was the first governor to be taken to court over his refugee order by the American Civil Liberties Union (ACLU), on behalf of Exodus, a local non-profit resettlement agency. On February 29th Tanya Walton Pratt, a federal judge, ruled that Mr Pence’s order to cut federal funds for the resettlement of Syrian refugees in his state was unconstitutional and “clearly discriminates against Syrian refugees based on their national origin”.After the initial bombast of his and the other governors’ announcements, Mr Pence had to confess that he cannot prevent Syrian refugees who have been admitted to America—after at least 18 months, and often much longer, of screening by intelligence agencies—from entering Indiana.

Economist 3/21/15

1. Turkey has now endured five big terror attacks since October, at a cost of nearly 200 lives. Residents of Turkey would therefore disagree with the EU’s assessment: the country no longer feels safe for anyone.No group has stepped forward to claim responsibility for the latest bombing. The day after the attack, officials identified a Turkish member of Islamic State (IS) as the perpetrator. IS has been quick to take credit for atrocities elsewhere. But it has yet to do so for any attack by its sympathisers in Turkey.Distressingly, the list of other possible suspects has grown longer over the past year. In neighbouring Syria, Turkish-backed proxies are fighting the regime of President Bashar al-Assad, his Russian allies, and the People’s Protection Units (YPG), a local affiliate of the Kurdistan Workers’ Party (PKK).Yet the biggest threat to Turkey’s security is homegrown. An urban insurgency waged by the PKK across the country’s southeast, accompanied by a ruthless crackdown by Turkish security forces, has left more than a thousand people dead.
2. Brexit (the prospect of Britain departing from the European Union) is a major talking point around dinner tables of Blighty, so the same must surely be true on the continent.Yet poll results from Lord Ashcroft—a Tory bigwig turned pollster—reveals a surprising degree of indifference on Europe’s mainland. Although around half of Europeans would prefer Britain to stay in the Union, over a quarter simply do not care. The apathy is strongest among women (32% are not bothered either way) and the young (30% of 24-34 year-olds).Some 20% of Austrians and 38% of Slovenians—two of the countries where apathy is at its highest—have negative views about Brits, above the continental average of 10%.
3. UNTIL recently, America hadn’t had a spectacular corporate disaster since Lehman Brothers in 2008. But Valeant, a Canadian but New York-listed drug firm, now meets all of the tests: a bad business model, accounting problems, acquisitions, debt, an oddly low tax rate, a weak board, credulous analysts, and managers with huge pay packets and a mentality of denial. The result has been a $75 billion loss for shareholders and, possibly, a default on $31 billion of debt.Valeant’s business model was buying other drug firms, cutting costs and yanking up prices. Since 2010 it has done $35 billion of deals, mainly financed by debt.
4. There are three lessons. First, boards matter: the managers should have been removed in October. Second, disasters happen in plain sight. Valeant issued $1.45 billion of shares in March 2015, when 90% of Wall Street analysts covering its shares rated them a “buy”.he final lesson is that “activist” investors, who aim to play a hands-on role at the firms that they invest in, have no monopoly on wisdom. Jeffrey Ubben of ValueAct and Bill Ackman of Pershing Square both own chunks of Valeant and have supported it.
5. FOR an export juggernaut, South Korea’s recent losing streak is alarming: for 14 straight months its exports have fallen in value terms compared with a year earlier.Last year POSCO, a steel giant set up in 1968, posted its first annual net loss.This month Daewoo Shipbuilding & Marine Engineering (DSME), one of the world’s biggest shipbuilders, recorded its worst deficit on record.In January Hyundai Motor, a carmaker, reported a drop in profits for an eighth straight quarter.Other businesses are thriving despite the downturn. Seven of the ten best-performing stocks last year in the MSCI Asia Pacific Index, a benchmark followed by big investment funds, were South Korean, among them pharmaceutical, cosmetics and aerospace firms.Media stocks have been buoyed recently by the success of CJ E&M, a subsidiary of CJ Corp, another chaebol.As media firms profit from the popularity of Korean soap operas, films and music in China and South-East Asia, more are partnering with Chinese firms to produce or promote content.

Economist 3/18/16

1. On March 17th Luiz Inácio Lula da Silva, Dilma Rousseff’s predecessor as Brazil’s president, was sworn in as his protégée’s chief of staff—a position she once held in his administration. He was in office for a mere matter of hours. A federal judge suspended the appointment on the same day, alleging what many Brazilians had suspected—that Lula was only offered the position to shield him from prosecution.Investigators have been inquiring into Lula’s possible role in a multibillion-dollar bribery scheme centred on Petrobras, the state-controlled oil giant, which appears to have begun while he was in office from 2003 to 2010.In a separate case, state prosecutors in São Paulo want him jailed while he is investigated for concealing the ownership of a seaside property. That case has now been handed over to Sérgio Moro, the crusading federal judge overseeing the Petrobras probe.A phone conversation between the former and current presidents, intercepted by police and released to the press, seems to bolster the case that she hired him to protect him from prosecution.
2. Ms Rousseff’s survival in office will depend largely on whether the centrist Party of the Brazilian Democratic Movement (PMDB), led by the vice-president, Michel Temer, remains in the coalition. The PMDB has given itself until mid-April to decide whether to stay. Public opinion—and increasingly that of the business elite, part of which is close to the PMDB—are pushing the party towards the exit.Indeed, the only way to appease the PMDB—and keep Ms Rousseff in power until her term ends in 2018—may be to strike a grand bargain on fiscal reform. This is what the party claims to want. But even an act of economic statesmanship might not save the government.
3. A DECISION this week by Moody’s, a ratings agency, to downgrade Mozambique from a lowly B2 to a dismal B3 has cast a pall over one of the world’s poorest countries.Two-and-a-half years ago, Credit Suisse raised $500m on behalf of Empresa Mocambicana de Atum (EMATUM), a newly created state-owned tuna-fishing company. A Russian bank, VTB, raised another $350m. The cash was supposed to pay mainly for a fleet of fishing boats. Instead, it was diverted into an array of other purchases, including security equipment. The company said it hoped to catch 200,000 tonnes of tuna a year, but is catching barely any fish at all.Meanwhile, the word among businesspeople in Maputo, Mozambique’s capital, is that the three main companies involved in the biggest gas projects—Anadarko from Texas, Italy’s ENI and South Africa’s Sasol—do not expect the gas to start flowing fully until 2023.The political mood has turned steadily more poisonous since the presidential election of October 2014, which was won by Filipe Nyusi, the candidate of Frelimo, the party that has ruled since independence in 1975. In a poll that the opposition said was unfair, he officially won 57% of the vote, against 37% for Afonso Dhlakama, who has led the Renamo party, often as a rebel guerrilla force, for more than three decades.
4. ON MONDAY March 21st, Barack Obama will become the first sitting American president to visit Cuba since Calvin Coolidge in 1928. Mr Obama’s trip is a symbolic culmination of a process of rapprochement that he and Raúl Castro, Cuba’s president, began in December 2014. Since then the United States has eased the half-century-old trade and travel embargo on Cuba, removed the country from its list of state sponsors of terrorism and restored diplomatic relations, cut in 1961. America’s government eased restrictions further on March 15th, allowing its citizens to travel to Cuba on their own for “educational” purposes and Cubans to be paid salaries in the United States.Cuba is visibly changing, in part because of economic reforms begun by Mr Castro before his accord with Mr Obama. But the changes so far have done more to enhance the lifestyles of a few than to bring freedom and opportunity to the majority of Cubans.
5. THE British government currently slaps a 5% Value Added Tax (VAT) on sanitary products. But some view the “tampon tax” as an affront to women, who have little choice but to bear the burden of the levy. The government has been prevented from reducing the rate to zero by European Union rules, which limit how much countries can lower VAT rates on some goods.But on March 17th, George Osborne rummaged around for a rabbit in his post-budget hat, and revealed progress towards a new VAT arrangement with the EU that would give him the freedom to ditch the hated tax.Scrapping the tax makes for more palatable politics, but leaves economic questions. Working out a rationale within the British system of VAT is a fool’s errand; products that enjoy the reduced rates are meant to be necessities, but the definition of a necessity is loose. Tampons would join things like ostrich meat and helicopters in the zero rate category, whereas toothpaste and toilet paper will face a rate of 20%.The bigger question is whether VAT is the best way to redistribute. One vision of an ideal tax system applies a uniform rate of VAT on all final consumption, and then uses the direct tax and benefit system to do the heavy lifting when it comes to redistribution.