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I've been watching Channel News Asia as of late, and a news item that struck me was the Malaysian ban on chicken exports starting this June. It's very much a supply chain issue: as the price (and hence availability) of chicken feed--comprised of grains and soybeans--has increased significantly, Malaysian chicken production has been reduced. Understandably, Malaysia is keen on having sufficient food for its populace before exporting it in this day and age of inflation and shortages. Unfortunately, neighboring Singapore has been negatively affected by Malaysia's impending chicken export ban. Hainanese chicken rice is Singapore's signature dish--a staple food in that wealthy Asian nation. Having little domestic chicken production, Singapore is reliant on imports from countries like Malaysia. Given its limited sources, Singaporeans now have to cope with this shortage. Let's begin with constraints on the supply end in Malaysia: Malaysia, itself facing soaring prices, has decided to halt chicken exports until local production and costs stabilise. Prices
have been capped since February at 8.90 ringgit ($2.03) per bird and a
subsidy of 729.43 million ringgit ($166 million) has been set aside for
poultry farmers.Chicken
feed typically consists of grain and soybean, which Malaysia imports.
But the government is having to consider alternatives amid a global feed
shortage. Lower
quality feed means the birds are not growing as fast as usual, slowing
down the entire supply chain, said poultry farmer Syaizul Abdullah
Syamil Zulkaffly.In turn, Singaporean food stalls have been feeling the pinch. To be sure, there are other sources of chicken such as Brazil. The problem, however, is that Brazil is much farther away than nearby Malaysia, necessitating freezing of chickens to the detriment of freshness and taste:Singapore,
although among the wealthiest countries in Asia, has a heavily
urbanised land area of just 730 square km (280 square miles) and relies
largely on imported food, energy and other goods. Nearly all of its
chicken is imported: 34% from Malaysia, 49% from Brazil and 12% from the
United States, according to data from Singapore Food Agency (SFA).A
plate of simple poached chicken and white rice cooked in broth served
with a side of greens is a dish beloved by the country's 5.5 million
people, and is usually widely available for about S$4 ($2.92) at
eateries known as hawker centres.The
SFA has said the shortfall can be offset by frozen chicken from Brazil,
and has urged consumers to opt for other protein sources like fish.Singapore being a wealthy country with more refined tastes, some restaurateurs would rather serve something else rather than frozen Brazilian chicken:Some vendors have said they will stop selling
chicken altogether and instead find alternative dishes – bad news for
fans of Singapore's much-loved dish of poached chicken, served with rice
cooked in stock, and chilli dip.The owner of the popular eatery Tian Tian Hainanese Chicken Rice told the Singaporean outlet The Straits Times
that it would stop serving chicken dishes if it could not get fresh
supplies. Its founder, Foo Kui Lian, said they would instead "bring back
dishes like fried tofu, fried pork chop and prawn salad, but we will
not use frozen chicken".The Singapore Food
Agency has encouraged the public to use frozen chicken, which is
imported from countries such as Brazil, or to try alternative meat or
fish, and to refrain from buying more than they need.Singapore's situation has been likened to McDonalds without burgers, but the analogy is not quite correct in that they do have chicken--albeit of the frozen variety. Still, it's another timely illustration of food shortages you encounter nowadays due to supply chain disruptions occurring worldwide.

 China's epic recurring COVID-19 shutdowns have frustrated multinational corporations aiming for predictability in their supply chains. Sure, China still benefits from having globally-renowned tech clusters. However, having your production capabilities curtailed again and again due to a handful of (relatively mild) COVID-19 cases doesn't encourage foreign firms, as you would expect.Not so long ago, I covered Vietnam's emergence as a major assembly hub for South Korea's Samsung [1, 2]. In the years since, it's developed a reputation as a reliable production center for MNCs. It was perhaps inevitable that Apple, frustrated like many others with the PRC's lockdown shenanigans, would look to set up shop elsewhere. Voila! Apple is coming to Vietnam:For the first time ever Apple is moving some iPad production out of
China and shifting it to Vietnam after strict COVID lockdowns in and
around Shanghai led to months of supply chain disruptions, Nikkei Asia
has learned.The U.S. company has also asked multiple component
suppliers to build up their inventories to guard against future
shortages and supply snags, sources said.China's BYD, one of the
leading iPad assemblers, has helped Apple build production lines in
Vietnam and could soon start to produce a small number of the iconic
tablets there, people with knowledge of the matter said.To be sure, Apple already makes its wireless earphones in Vietnam. It makes business sense: experiment first with some components, and then shift further assembly work if things go well:The iPad will become the second major line of Apple products made in the
Southeast Asian country, following the AirPods earbud series. The move
highlights not only Apple's continuous efforts to diversify its supply
chain but also the growing importance of Vietnam to the company. Also keep in mind that Vietnam is still mostly an assembly hub--stick socket A into socket B sort of mundane work. Many of the components for the "Vietnam-made" iPad will still come from, you guessed it, China. Hence, Apple wants to bolster supplier capabilities in parts of China that have a lower likelihood of being shut down based on the historical record:To further guard against supply chain disruptions, Apple has also
asked suppliers to build up additional supplies of components such as
printed circuit boards and mechanical and electronics parts, especially
those made in and around Shanghai, where COVID-related restrictions led
to shortages and logistic delays. In addition, the company has asked
suppliers to move quickly to secure supplies of some chips, especially
power-related ones, for the upcoming iPhones.In
particular, Apple is asking suppliers outside of the lockdown-affected
areas to help build up a couple of months' worth of component supplies
to ensure supply continuity over the next few months. The requests apply
to all of Apple's product lines -- iPhones, iPads, AirPods and MacBooks
-- sources said.
The next step in Vietnam's development is therefore obvious: to move from assembly to manufacturing components as well following in China's footsteps before it became lockdown land.

Japan usually goes along with US economic plans... but how about other Asian countries?  Before Trump, the Republican Party represented the pro-trade American political party--especially in contrast to the trade union-dependent Democratic Party. Although Democratic presidents like Clinton and Obama promoted free trade agreements, they relied on Republican support to push FTAs through. After Trump, 'free trade' has become a dirty term in American politics regardless of party. So how is President Biden to shore up America's presence in the Asia-Pacific after his predecessor Barack Obama proposed the Trans-Pacific Partnership subsequently abandoned by Donald Trump? The answer is... do away with 'free trade' altogether. I am not sure what appeal Biden's Indo-Pacific Economic Framework for Prosperity [IPEF] offers to Asian countries absent the usual tariff reductions. The details of IPEF are still very much to be determined based on consultations with the proposed participants. At best, it could represent useful technical assistance to others about making their economies more connected, resilient, clean, and fair. At worst, it could actually worsen trade access--especially to the vast American market--by imposing developed country environmental and labor standards on developing countries.  At this stage, all we have to go on are the following bullet points: Connected Economy: On trade, we will engage comprehensively with
our partners on a wide range of issues. We will pursue high-standard
rules of the road in the digital economy, including standards on
cross-border data flows and data localization. We will work with our
partners to seize opportunities and address concerns in the digital
economy, in order to ensure small and medium sized enterprises can
benefit from the region's rapidly growing e-commerce sector, while
addressing issues is such as online privacy and discriminatory and
unethical use of Artificial Intelligence. We will also seek strong labor
and environment standards and corporate accountability provisions that
promote a race to the top for workers through trade [my emphasis].Resilient
Economy: We will seek first-of-their-kind supply chain commitments that
better anticipate and prevent disruptions in supply chains to create a
more resilient economy and guard against price spikes that increase
costs for American families. We intend to do this by establishing an
early warning system, mapping critical mineral supply chains, improving
traceability in key sectors, and coordinating on diversification
efforts.Clean Economy: We will seek first-of-their-kind
commitments on clean energy, decarbonization, and infrastructure that
promote good-paying jobs. We will pursue concrete, high-ambition targets
that will accelerate efforts to tackle the climate crisis, including in
the areas of renewable energy, carbon removal, energy efficiency
standards, and new measures to combat methane emissions. Fair
Economy: We will seek commitments to enact and enforce effective tax,
anti-money laundering, and anti-bribery regimes that are in line with
our existing multilateral obligations to promote a fair economy. These
will include provisions on the exchange of tax information,
criminalization of bribery in accordance with UN standards, and
effective implementation of beneficial ownership recommendations to
strengthen our efforts to crack down on corruption.Right now, IPEF is still nebulous enough to be vaporware. For others, there is a possibility that IPEF is largely downside (a grab bag of broadly protectionist US priorities) without upside (enhanced market access especially through lower tariffs).

Much has already been written about the emergence of "fast fashion": clothing retailers that are able to translate trends seen on the world's fashion runways... to a store near you in a matter of weeks. The success stories of Sweden's H&M and Spain's Mango have become the stuff of business legend in upending the fashion industry in recent decades. It was probably only a matter of time that onetime suppliers in China would become the firms at the cutting edge of evolving to customer's whims and desires that move so quickly. Younger women should be familiar with China-based online retailer Shein. Reflecting the democratization of fashion brought by the online world, it's not the big fashion houses that set today's trends but rather posts on the likes of Instagram and Pinterest. In keeping with the times, Shein is almost entirely an Internet selling pure play instead of having bricks-and-mortar stores still like H&M or Zara. Rest of the World writes more about this emerging business success story:Shein eventually expanded to offer apparel for women, men, and
children, as well as everything from home goods to pet supplies, but its
core business remains selling clothes targeted at women in their teens
and 20s — a generation who grew up exploring their personal style on
platforms like Instagram and Pinterest. 



Its clothes aren't intended for Chinese customers, but are destined
for export. In May, the company became the most popular shopping app in
the U.S. on both Android and iOS, and, the same month, topped the iOS rankings in over 50 other countries. It's the second most popular fashion website worldwide.By 2020, Shein's sales had risen to $10 billion, a 250% jump from the year before, according to Bloomberg. In June, the company accounted for 28% of all fast fashion sales in the U.S. — almost as much as both H&M and Zara combined. The same month, a report circulated that Shein was worth over $47 billion, making it one of the tech industry's most valuable private startups.Think of Shein more as an Amazon-a-like instead of comparing it to the established fast fashion names in terms of its business model: At the heart of these issues is Shein's aggressive business model.
Comparisons to fast-fashion giants like H&M miss the point: it's
more like Amazon, operating a sprawling online marketplace that brings
together around 6,000 Chinese clothing factories. It
unites them with proprietary internal management software that collects
near-instant feedback about which items are hits or misses, allowing
Shein to order new inventory virtually on demand. Designs are
commissioned through the software; some original, others picked from the
factories' existing products. A polished advertising operation is
layered over the top, run from Shein's head offices in Guangzhou.Ethical concerns with work conditions in Chinese garment factories aside, Shein's advantage is being able to call on PRC suppliers to shift even more quickly than European fast fashion firms:For years, European brands like Zara and H&M have embodied fast
fashion, shortening the route from runway to storefront from months to
weeks. But Shein isn't chasing runway trends — rather, it often knocks
off items seen on TikTok and Instagram, where hype cycles move
significantly faster. Whereas Zara typically asks manufacturers to turn
around minimum orders of 2,000 items in 30 days, Shein asks for as few
as 100 products in as little as 10 days. "They want factories to be much
more nimble," said Lu.If speed is Shein's competitive advantage, it must adapt to even quicker cycles going forward. Or, will someone even speedier supplant Shein just as it has H&M and Zara (which outran department stores before them)? Something else I thought the article could have shed more light on is how Shein is working around supply chain snags like the US-China trade war, intermittent COVID-19 lockdowns in the PRC, and rising shipping costs.

By now, it should be obvious to just about everyone that goods whose availability we once took for granted are in short supply. Blame COVID-19 lockdowns affecting countries where these goods are being produced, a breakdown in air/sea/land transport logistics, and so on. The pre-COVID-19 world was built on distributing manufacturing facilities where things could be made most efficiently, assuming fairly inexpensive shipping even across vast distances. Is that world now gone? We'll have to wait and see if and when the pandemic subsides. In the meantime, here's another not-quite-amusing example for those encountering these shortages: A few days ago, I noticed that my supplies for the exercise supplement creatine monohydrate were running low. I experienced sticker shock while scanning current selling prices. Briefly, what creatine does is replenish the body's supply of adenosine triphosphate (ATP), which fuels muscle contractions such as while performing resistance training. It turns out that most of creatine's precursors come from (surprise!) China. As many of you are probably aware, China has taken a zero tolerance approach to confronting COVID-19 outbreaks. With production centers and major port cities not immune to these recurrent lockdowns, creatine supplies have taken a hit. Here is a detailed and enlightening discussion of the ongoing creatine shortage from the Natural Products Insider:Strict export regulations and regional COVID-related limitations are
slowing China-originating supply chains for two top sports nutrition
energy ingredients, caffeine and creatine. Outside of China, suppliers
and manufacturers are clamoring to beef up inventories of these
increasingly hard-to-find materials but face steeply rising prices for
whatever supply they can secure [...] Similarly, the price of creatine has risen from its consistent $4 per kilo to between $10 and $14/kg.There is more good detail: More unique to the sports nutrition industry is creatine, which
factors into energy production in the body and is popular with core
market users, namely bodybuilders and athletes looking to boost muscle,
performance and recovery. "There is a worldwide creatine shortage," confirmed Jeff Golini,
Ph.D., executive scientist for All American Pharmaceutical, who
confirmed all the raw material to manufacture creatine comes out of
China, meaning this shortage impacts all forms of creatine, from
monohydrate to hydrochloride (HCl).

Thus, while suppliers such as AlzChem Trostberg GmBh (Creapure) and
All American Pharmaceutical (Kre-Alkalyn) make their ingredients in
Germany and Montana, respectively, their starter materials come out of
China, placing even these suppliers in the impact zone. What's behind the shortage is not quite clear and asking different
"insiders" results in varying answers, including lots of guesswork and
perspectives.

Vitajoy sells both caffeine and creatine, and Crane said as far as he
can tell the shortage is related to the pandemic. His sources suggested
COVID-related issues in the northern area of China, where most creatine
factories reside, caused production facility closures. "I believe that
is what might have started the ball rolling," he reasoned. "From there
it was reported that there were some starting material issues and,
before you knew it, any availability in creatine was gone."

Worse yet, the US-China trade conflict seems to be worsening availability:  Golini attributed the shortage to changing world politics, including
the recent U.S. presidential administration transition, and the ongoing
global power struggle involving trade. "China now is saying we have a
shortage of everything in order to re-control the world market, create
demand and raise pricing," he said. "From creatine to resins to make
plastics to pipe to erythritol to you name it."

"Creatine is $14/kg if you can find it," Kneller lamented. Crane noted pricing went from around $4 to more than $8/kg in a
matter of months. "We feel like we might be seeing some daylight
regarding supply in the coming months, but it's hard to pinpoint exactly
when," he reasoned. Golini sees a longer struggle. "This shortage for creatine—as a
matter of fact, there is none [available]—will continue this entire
year, and you will see pricing go through the roof," he warned.Then there are the aforementioned regional shutdowns for COVID-19 containment--including areas crucial for creatine supply chains. These include Wuhan itself:

Creatine producers appear
concentrated in the northeastern province of Hebei, near the Yellow Sea
separating China from both Koreas and Japan [...] In January 2021, Chinese officials locked down the city of Shijiazhuang,
the capital Hebei, and other areas of the province due to a COVID
outbreak. Hebei Hangwang Import and Export Trading Co. Ltd., Sure
Chemical Co. Ltd. Shijiazhuang and other creatine producers are located
in this city. However, this restriction was lifted March 25, leaving only the city of Wuhan, Hebei, still under a lockdown that was lifted April 7. According to Made in China, several creatine suppliers are located in Wuhan, where COVID was first detected in China.

The bottom line is supply chain disruptions have become more common
and rolling over the past several years due, among several reasons, to
trade wars and the pandemic. Many supplement companies have grown to
accept this fact, take steps to be better prepared and hope situations
improve. "We expect global supply chain disruptions to follow COVID," Titlow
summarized. "The better COVID is managed (e.g. vaccines), the better the
supply chain."There's even an amusing video online about bodybuilders regarding the creatine shortage as a harrowing event of enormous proportions. These are not quite the best of times for global supply chains; that much is clear.

There are all sorts of unexpected but fairly amusing shortages occurring worldwide given supply chain snarls that are happening as the world deals with the ongoing pandemic. It seems that spreading out manufacturing and sourcing locations to far-flung areas of the globe makes less sense when logistical hurdles arise due to lockdowns as COVID-19 surges pop up again and again in various key countries. Take, for instance, ethoxydiglycol. This chemical sourced from places
like (surprise!) China are in short supply in Europe. Without it, a lot
of formulations for cosmetics cannot function properly. Ever wonder how
UK celebrities maintain that year-round glow despite the onset of
winter? Well, their beauty secrets may be unraveling real soon unless
these supply chain issues are worked out:The UK could be on the cusp of a cosmetics shortage as prices balloon
for a vital chemical used in many eczema creams, fake tans and
shampoos. A chemical called ethoxydiglycol has been described as
the "unsung hero" of cosmetics. It is part of the formula that improves
the way cosmetics are applied to the skin. Without it, many cosmetic
products as we know them would be unusable.Ethoxydiglycol is
widely used in cosmetic products because it is soluble in both oil and
water-based products, such as propylene glycol, water, vegetable oil and
ethanol. The shortage, which is expected to hit UK and European
cosmetics manufacturing in the next few weeks, has already seen a near
ten-fold price hike. While price hikes have become necessary in light of what's happening, they may rise yet further:Ethoxydiglycol prices have increased from £12.10 ($16.50) to £103 per
kg in recent weeks. Many suppliers are now completely out of stock. Minimum
order quantities set by many suppliers have also increased from 24kg to
1,000kg. This means that the minimum order to purchase Ethoxydigylcol
is £103,000, which will halt production for many smaller businesses who
cannot afford to purchase in those quantities.In keeping with the concept of economies of scale, it's often the little guys who get hurt the most.

 There's an interesting article in Fortune on the true environmental costs of using Bitcoin as a medium of exchange to replace cash, debit cards, credit cards, and other commonly-used payment methods. Given the enormous amounts of electricity needed for bitcoin mining, it is perhaps no surprise that estimates on the high end find it to be an unsustainable proposition. So much for using Bitcoin for everyday transactions?The [MoneySuperMarket] report states that each Bitcoin transaction consumes 1,173 kilowatt
hours of electricity. That's the volume of energy that could "power the
typical American home for six weeks," the authors add. The Bitcoin
mining that enables a purchase, sale or transfer, it posits, uses a slug
of electricity that costs $176. That number is based on an average
worldwide cost per kWh of 9.0 cents over the past 12 months.What it we lower the estimated price per kilowatt hour to 5.0 cents? Some argue that figure is more in line with global energy costs. I am afraid that does little to make Bitcoin any more sensible as a means to transact given the costs of generating these coins still:So let's reduce the MoneySuperMarket number from 9 cents per kWh to the 5
cents favored by de Vries. That would put the average cost of producing
a coin at around $19,000, which looks reasonable (and underscores the
industry's gigantic profitability as price hovers at over three times
that level). At 5 cents, the electricity cost per transaction would fall
from $176 to roughly $100.For every transaction you make with Bitcoin, that's what you would be paying in electricity costs. When the likes of Visa and Mastercard can process these sorts of transactions for cents, it puts Bitcoin's true costs into sharp relief. The argument that ever-lower cost locations for mining these coins is a solution has its limits too, with these destinations now discouraging Bitcoin mining as power outages arise as a result.  The global movement of Bitcoin miners eventually becoming persona non grata is a very interesting story in itself, but I digress...Bitcoin's drawback is that electricity is finite, and what Bitcoin uses,
a family or a business can't use. In several nations, Bitcoin mining is
imposing severe stress on the grid. Kazakhstan, one of world's leading
crypto mining hubs and a top destination for producers displaced by the
Chinese lockdown, is suffering blackouts caused by the industry's sudden
explosion within its borders. Its government is limiting producers to a
fraction of the electricity they're now deploying. Iran has also
suffered severe shortages that's led to ejecting producers, and tiny
Abkhazia is raiding mines––many of them illegal––to forestall an energy
crisis.The bottom line is that Bitcoin mining in its current form is unsustainable, and so is its use as a medium of exchange. 

Unless you've been hiding under a rock these past few months, headlines about how the PRC is cracking down on its most lucrative companies--Internet-based services, video games, online education, and the rest--have dominated business news. This crackdown is ostensibly in the name of maintaining social order--not letting inequality get out of hand, not getting young people hooked on mindless games, and so forth. This social engineering is most evident in new rules aiming to restrict hours spent by those under 18 on video games to no more than three. So far, the largest victims of this erstwhile Xi Jinping-organized socialist putsch have been local firms. However, those feared to be next in the firing line are foreign purveyors of luxury goods. Are they next in line in being styled as "enemies of the people"?Chinese President Xi Jinping has stepped up his call for "common
prosperity," sending shudders through luxury goods vendors, which worry
that China's rich will not be able to splurge on $3,000 bags.  The
fear was palpable on the stock market last week. Shares of Paris-listed
Kering, owner of the Gucci brand, slumped 17%. Switzerland's Richemont,
the company behind such names as Cartier and Piaget, sank 14%. LVMH
Moet Hennessy Louis Vuitton and Hermes slid 13% and 8%. Makers of
high-end cars were hit as well, with Porsche down 10% and Ferrari 6%.The
catalyst was Xi's call for "common prosperity" as part of "high-quality
economic development" last week at a meeting of the Chinese Communist
Party's Central Committee for Financial and Economic Affairs. The
committee called for adjusting "excessive incomes" and redistributing
wealth that has become overly concentrated in the hands of a small
number of people.Veteran China commentator George Magnus (ex-UBS) I believe has it right when he says the current crackdown has more to do with the Communist Party maintaining control than any sort of re-commitment to socialist principles. Insofar as the likes of Alibaba and Tencent were gaining more and more of the "mindshare" of the Chinese people, they posed a threat to Communist Party fealty. Hence, they had to be knocked down to size to ensure that no other gods would be placed before the Party.My belief is that Western luxury brands are not as vulnerable for this reason: while they may symbolize the wrong things like conspicuous consumption, they do not really pose a threat to the control that the Party has on various aspects of Chinese life--political, economic, social or technological. Ironically, it's the domestic tech giants who pose more of those kinds of threats, hence the recent actions.

Be fruitful and multiply during the age of climate change? Think again. One of the most fascinating existential questions has been posed on the business news channel CNBC, of all places, as would-be parents consider the wisdom of having children. While there are climate deniers like most of the US Republican Party and other reality-challenged individuals, most reasonable people accept the premise that global temperatures are rising due to human activity. The recent IPCC report leaves us in no doubt that things are getting worse in this regard. Already, we are witnessing severe climate change negatively affecting human life. So, the question is: Does it make sense to have children who will grow up on a degraded planet?The article is interesting in probing a number of angles on this question, the answer to which will ultimately have significant implications on the future of humanity:1. What is the carbon footprint of raising a child?2. How does a warming planet impact fertility rates?3. Is it ethical to bear children knowing their quality of life will be negatively impacted by worsening climate change?   As a Catholic educator, the third question is the most interesting one to me. The obvious "Christian" answer would be that we should not presume things will get worse: It is still within the current generation's abilities to limit the future negative effects of climate change on future generations, although that window of opportunity is rapidly closing (see Pope Francis' 2015 encyclical Laudato Si). Given the massive collective action problems we have, though--including a main political party in the world's second-largest carbon emitter the United States denying the very existence of climate change--what are the chances of global citizens clamoring and working towards improvement? As the article suggests, more thoughtful would-be parents are giving these considerations a lot of though provided the almost non-existent progress on arresting warming trends observed around the world. There are no easy answers going forward.

Ever consider that the US birthrate is dropping precipitously since it's a rather s--tty place to live? Like most developed countries, the United States is experiencing cratering birth rates. If the replacement rate is 2.1 birth per woman, its current reported rate of 1.6 is well below that. In other words, depopulation will set in for America just as it has for the likes of Japan and others if births continue to crater and anti-immigrant sentiment scares off would-be migrants. Fewer birth and nobody being welcomed inevitably spells depopulation. Although the United States likes to portray itself in all sorts of self-aggrandizing ways--the promised land, shining city upon a hill, and all that jazz--the truth is that its livability is rather worse than any number of other places.A Bloomberg interview with demographer Lyman Stone has some interesting things to say on the matter. First, flexible work may not be the solution: I think policymakers still have this delusion that the path to
high fertility is everybody having an awesome job with great benefits
allowing them to be "flexible" for their family, but this just isn't
reality. As jobs, even "family-friendly" jobs, turn into careers, and
careers turn into essentially religious or spiritual vocations, family
is deprioritized and birth rates decline. In empirical studies of
surveys across nearly 100 countries, a co-author and I found that this
effect was actually as strong for men as for women, so this isn't just
about breadwinners. The boss in the movie "Elf" is the bad guy because as far as a child is concerned, a parent's work is always the biggest competition for that parent's mental and emotional energy.Another observation is that Trumpian racists tend to gain favor as birth rates fall, which obviously has ominous portents: But as birthrates fall, far-right anti-immigration parties tend to do better,
not worse. So if a traditional value of being welcoming to immigrants
is something important to Americans, again, low fertility is a problem,
because it threatens the viability of political coalitions that support
an attitude of welcome and hospitality. And of course, in a more literal
sense, the absorptive capacity of a society with regard to immigrants
is related to population size: 1 million immigrants has a very different
social significance to a society with 100,000 births than a society
with 1 million or 10 million. Completing this downward spiral of falling birth rates mobilizing far-right ultra-racist groups is that low birth rates tends to quash innovation, too: Another thing we appear to value is something like, "Having a
dynamic economy with lots of innovation and entrepreneurship, without
inherited wealth that dominates the economic landscape." But I've shown
in extensive work that low birth rates directly predict less
innovation, lower entrepreneurship and a higher salience for inherited
wealth.America with all its problems has too far to go in fixing its broken society. It won't become much more livable anytime soon, so expect its birth rates to continue stagnating. 

The Finnish far-right scares away many migrants... but how welcoming are ordinary Finns? There's this interesting conundrum in international migration of countries that, on paper at least, should be among the world's most attractive destinations having problems finding migrant workers. The rationale for this migration are well-known: Developed (and mostly Western) nations with high standards of living are aging, and generous state-provided benefits cannot continue when those being supported (retirees) are promised far greater resources than those being put into the system by current employees. The logical solution in theory is to attract migrant workers to fill this gap, but reality intrudes. Take the case of Finland. While it is near the top or tops global league tables for standards of living, paths for migrant workers remain treacherous. Let's begin with its dire population projections that necessitate more migrant workers coming in:While many Western countries are battling weak population growth, few are feeling the effects as sharply as Finland. With 39.2 over-65s per 100 working-age people, it is second only to
Japan in the extent of its ageing population, according to the United
Nations, which forecasts that by 2030 the "old-age dependency ratio"
will rise to 47.5.
The government has warned that the nation of 5.5 million needs to
practically double immigration levels to 20,000 to 30,000 a year to
maintain public services and plug a looming pensions deficit.Despite its dire demographic situation, however, the country has done little to make itself more attractive and hospitable to migrant workers. While there is outright xenophobia in the form of far-right politics, what may be more concerning is that regular Finns do not really make much in the way of concessions to newcomers. As a result, those with high levels of "human capital" are no more likely to stay given the less-than-welcome reception they have received in Finland:But anti-immigrant sentiment and a reluctance to employ outsiders are also widespread in Western Europe's most homogenous society, and the opposition far-right Finns Party regularly draws substantial support during elections...But previous such efforts have petered out. In 2013, five of the eight Spanish nurses recruited to the western
town of Vaasa left after a few months, citing Finland's exorbitant
prices, cold weather and notoriously complex language. Finland has nonetheless seen net immigration for much of the last
decade, with around 15,000 more people arriving than leaving in 2019. But many of those quitting the country are higher-educated people, official statistics show.Horror stories are rife of even talented folks experiencing outright hostility:Start-ups "have told me that they can get anyone in the world to come
and work for them in Helsinki, as long as he or she is single", the
capital's mayor, Mr Jan Vapaavuori, said to AFP. But "their spouses
still have huge problems getting a decent job". 
Many foreigners complain of a widespread reluctance to recognise
overseas experience or qualifications, as well as prejudice against
non-Finnish applicants. Mr Ahmed (who requested his name be changed for professional reasons)
is a 42-year-old Brit with many years' experience in building digital
products for multinational, household-name companies. Yet, six months of networking and applying for jobs in Helsinki,
where he was trying to move for family reasons, proved fruitless. "One recruiter even refused to shake my hand. That was a standout moment," he told AFP.As with Japan, the same question holds: For how long can they hold on to such parochial attitudes in the face of such unfavorable demographic headwinds?

Addled horses may be the least of horse racing's worries if the sport's subsidies take a hit.As a casual follower of horse racing, I was intrigued by the legendary horse trainer Bob Baffert being barred from participating in the third leg of the Triple Crown, the Belmont Stakes, due to doping. Baffert has already been cited for doping a number of times, but this time is the most noteworthy, just coming off a Kentucky Derby victory in the sport's most prestigious event. As it turns out, horse racing--in the United States at least--is a dying sport. if the pot of money being contested over keeps shrinking, well, that would help explain why even the most prominent trainers are tempted to turn the odds in their favor through underhanded means. Unbeknownst to me, and I suspect most everybody else outside the industry, American horse racing circa 2021 cannot stand on its own... four legs. Probably by invoking nostalgia and tradition, the industry has managed to wangle massive state government subsidies: It's a story rarely told outside the racing industry, and
understandably so: Horse racing is propped up by tax dollars from
casinos that have nothing to do with what happens on the track or at the
betting windows. Although the sport loses public interest with each
passing year, at least 24 states, almost three-quarters of those with
racing, directly subsidize
it with public funds. Based on publicly available information and
statistical analysis, the total is likely close to $1 billion annually.New
York and Pennsylvania alone account for half of that amount; over the
last 15 years, they've distributed around $6 billion. Both states also
forgo countless millions each year in sales taxes they don't charge on
racehorse purchases, an exemption that doesn't apply to other kinds of horses.Throughout
the country, horse racing has become so heavily subsidized that it
resembles a public enterprise. In Pennsylvania, for instance, the Race
Horse Development Fund is the state's single largest economic
development program, and it funds nearly every aspect of horse racing,
from purses to support for breeders, health and pension benefits for
horsemen, drug testing of the horses, and even racetracks' advertising
costs.Is horse racing too big to fail, in financial parlance? The emerging backlash is that these taxpayer dollars are going to an increasingly marginal pastime whose patrons are mostly the rich who can spare cash to gamble with when there are so many urgent social concerns:But the issue isn't going away, especially not as the pandemic has
dynamited state finances, leaving lawmakers with tough decisions. This
February, [Pennsylvania governor] Wolf again included a cut to racing's subsidy in his proposed
2021 budget. And last week, the editorial board of The Philadelphia Inquirer called for the industry to be "put out of its misery.""It's
like a giant party on the Titanic," Ward said, "except the guests know
what is coming." For racing's dependence on public money, Pennsylvania
might be just the tip of the iceberg.The doping scandal will probably only raise more questions the industry would rather the general public be unaware of. Make no mistake: American horse racing, a pastime for the wealthy, is on the dole in a big way. 

Will PRC students soon be an increasingly rare sight on Aussie campuses?Just when you thought China-Australia relations could get no worse, it seems they find something new to quarrel about. Perhaps the last golden goose Australia has left is its higher education sector, which still (rather amazingly) attracts scores of PRC students. That said, there appears movement afoot in China for recruiters to not promote Australia as a higher education. Anticipating matters may get worse (which is likely given how things are going between these two), Aussie universities are setting their sights on diversifying their international student base. Researchers from the Australia National University in Canberra are urging the government to get moving in making their country's universities less reliant on Chinese students:Dr Dirk van der Kley and
Dr Benjamin Herscovitch argue education is Australia's only remaining
export valued over $10 billion annually which is "both reliant on China
and which Beijing can target without significant self-harm". The
industry employs thousands of Australians, and is closely linked to the
country's technological competitiveness, the pair say.Coercion against the sector would significantly impact Australia's prosperity. "If
there was a significant drop in students from China, the revenue and
research loss would be impossible to fully replace through other
international markets because China is the largest source of globally
mobile students," the authors write. The government would not be able to step in and fill that gap, they say.Speaking of which, the Chinese government holds more cards in being able to harm Australia's economy given the economic importance of higher education service exports to the PRC and other nations: The
pair point out that media reports already indicate education agents in
some Chinese cities were discouraged from promoting Australia as an
education destination. Beijing could go
further, by fostering negative views of Australia and its universities
via the state-controlled media or even ceasing to recognise some or all
Australian qualifications.By recruiting more students from other locations, Australia could safeguard itself from Chinese coercion to a degree.With both countries apparently not keen on talking with each other to resolve economic and other differences, it will probably happen all of a sudden and without much warning if the PRC starts discouraging its students from going to Australia. 

Is the UK topping this table due to "greed" at the EU's expense? The height of 80s money worship is symbolized by the 1987 film Wall Street whereGordon Gekko, Michael Douglas' memorable character, reasoned that "greed is good." As a person who came of age during that decade, all I can say those were the days, my friends, even if I do not necessarily agree with the sentiment. Or has "greed is good" logic been consigned to the dustbin of history? Of all the darndest places, we are now being refamiliarized with the phrase in the age of COVID-19. Supposedly we're in this enlightened age where getting everyone vaccinated is in everyone's interests. Given the increased global interconnections we have nowadays, not suppressing the virus in one part of the Earth means that all of us remain vulnerable. Or so that logic goes. Now we have reports that UK Prime Minister Boris Johnson argued in private that "greed is good" when it comes to COVID-19 vaccinations. That is, the UK would not have controlled the spread of the virus in recent weeks had it not been greedier with allowing foreigners access to the vaccine:Capitalism and greed gave Britain its success in vaccinating its
population, Prime Minister Boris Johnson told lawmakers in a closed
meeting, a remark that could rile up Brussels at a time when Britain
faces an EU threat to block vaccine imports. "The reason
we have the vaccine success is because of capitalism, because of greed
my friends," The Sun newspaper quoted Johnson as telling Conservative
lawmakers on a Zoom meeting on Tuesday evening. Johnson then tried to row back and said: "Actually I regret saying it" and asked lawmakers repeatedly to "forget I said that".Needless to say, that statement is not playing well with other Europeans who are considered behind the UK in vaccinating their citizens. Witness the AstraZeneca vs. EU row over allowing vaccines made in the Netherlands to be exported to the UK (AstraZeneca has joint Swedish-British ownership). Fun times:Britain
has so far mounted the fastest COVID-19 vaccine programme of any big
country. But it now finds its programme threatened by the EU, which has
been far slower in rolling out vaccines and faces a third wave of
infections. The
European Commission is expected on Wednesday to extend powers to block
exports, a move that could hit supply of doses bound for Britain.
Johnson's remarks come after a week in which British ministers have
tried to calm the row.Downing
Street declined to comment on Johnson's remarks when contacted by
Reuters, but unidentified sources gave the BBC a bizarre array of
explanations.The
greed comment, according to the BBC's political editor Laura
Kuenssberg, was apparently a joke about one of his cabinet colleagues,
Chief Whip Mark Spencer, who was gobbling a cheese and pickle sandwich
while the prime minister spoke.Cheese and pickle sandwiches, Gordon Gekko... and COVID-19 vaccines. These are interesting times. 

Is Hong Kong circa 2021 ideologically closer to Mao Zedong than Milton Friedman? Hong Kong used to be regarded as the world's shining example of the merits of free markets. No less than Milton Friedman--the most prominent libertarian thinker of his generation--lauded Hong Kong for its economic success due to following laissez-faire policies. Once upon a time, and for quite a long time, Hong Kong led the world in the ease of setting up and closing a business, allowing entrepreneurs manifold opportunities to come up with a formula to make it big. Government rarely made its presence felt back in the day.Like all good things, however, this success story had to come to an end. It used to be that Hong Kong routinely topped or ranked near the top of the arch-conservative Heritage Foundation's annual Index of Economic Freedom. To be sure, Hong Kong remains a gateway to Asia due to its proximity to mainland China. But, with respect to economic freedom, recent encroachments by the PRC into its running have given us this strange result: Hong Kong isn't even being considered here anymore thanks to seemingly endless PRC meddling in its political economy. Hong Kong is now regarded as a PRC satellite instead of an independent entity worthy of separate consideration:Hong Kong has been removed from an annual index of the world's freest
economies because the think-tank that compiles the league table said
the city was now directly controlled by Beijing. The announcement is a reputational blow for Hong Kong and comes as
Beijing ramps up its bid to quash dissent after huge and sometimes
violent pro-democracy demonstrations in 2019.
The Heritage Foundation, a conservative US think-tank, publishes an
annual Index of Economic Freedom ranking countries and territories for
how business-friendly their regulations and laws are. Over the last 26 years Hong Kong topped the table for all but one
year - a source of pride to the city's government which often used the
accolade in its official press releases and investment brochures.




But when the 2021 ranking is released later on Thursday, Hong Kong
will not appear because the report's authors believe the city is no
longer independent enough of Beijing to justify separate inclusion. "The loss of political freedom and autonomy suffered by Hong Kong over
the past two years has made that city almost indistinguishable in many
respects from other major Chinese commercial centres like Shanghai and
Beijing," Edwin J Feulner, the founder of the Heritage Foundation, wrote
in the Wall Street Journal on Wednesday. And that's all she wrote.