Casper Economic and Political blog

That is Global competition.  Either Malaysia reform and be competitive, or get wiped out.

A graduate accountant for $4000 (GBP1600 real exchange rate / GBP3000 in after tax purchasing power approximately) in Singapore, nice one.

I think even UK graduate should consider the move..

中国报：马国人才投身新加坡IR
使柔南计划面对巨大冲击

（2008-09-12）

I read this  http://taxprof.typepad.com/taxprof_blog/files/120TN0887.pdf
today.  It was written by David Cay Johnston, former tax reporter for The
New York Times.

The article basically says US wages for the 99 percentile has hardly increased (and in fact, real
wages of the lower earning US workers have in effect decrease from 2000 to 2007) and call for policy
that protect worker’s wages.

BUT… the sole reason of depressed wage level in the US and most of the west is that the West has been having it too goo for too long. In economic term, their super-wages will have to come down to the mean when more and more labour, who are getting more productive by the day, enter the market.  Unless western workers become more productive (e.g. 1 person can produce more than, say 10 people in China), then cannot realistically expect their wages to be 10 times more than China over medium term.

Those who are argue for higher wages (without higher productivity) often forget that while in isolation, it looks like it is good for the worker, in reality, it is unlikely to be so (unless of course he is the only person who get higher wages in the economy).  This is because at current wage level, he can get a McDonald burger for say £2.50.  If every McWorker get paid £10 per hour (vs around £5.50), the price of the burger will likely to double to £5.  That goes with all services that he/she use.

Also will a conssumer buys a American DVD player that cost 4 times as much as a China made DVD player that has the capabiltiy - extremely unlikely.

Higher wages without higher productivity means one thing - just look at GM (lots of benefit) - Bankruptcy. Of course, when the employer goes burst, the wages becomes ZERO.

Those who are still dreaming the American Dreaming (or UK/France/German dream) needs to wake up.  The super-normal wages occured because most Asian (and now Arabs, African, Eastern European) competitors were sleeping.

Coincidentally, HSBC Chairman stephen green said here

http://www.bloomberg.com/apps/news?pid=20601087&sid=a7_nACEQnBlQ&refer=home

Sept. 5 (Bloomberg) — HSBC Holdings Plc Chairman Stephen Green foresees financial markets shifting toward Asia as emerging markets grow faster than the rest of the world economy.

So..wake up & work and stop dreaming.

http://www.timesonline.co.uk/tol/life_and_style/health/article4040146.ece

Reported that a patient who opted to use her saving to pay for private treatment was banned from continuing her free NHS treatment despite her full National Insurance contribu8tion. She subsequently died.

Also, in the NHS, a patient is not allowed to pay for additional drug and must accept what is on offered.

“Alan Johnson, the health secretary, claims that co-payment would create a two-tier NHS, with preferential treatment for patients who could afford the extra drugs. Last year he issued guidance to NHS trusts ordering them not to permit patients to pay for additional medicines.”

So, we are back to typical marxist-socialist ideology that if not everybody can have a car, then no one should be allowed to have one either (Except the top leadership perhaps).  It is a state says so central planning style governance that made so many suffer in the USSR era.

A reader commented that if he hires private tutor to help his kids, does that mean that he has to pay the full cost of the state education (because this would create a two tier schooling system)?

Such restriction / contract would no doubt be outlawed by the court if made in any other situation (e.g. if there is a standard contract that says if I use a private parcel company that I am banned from using Royal Mail), that would have been rejected by the court.

It is people’s life that we are talking about here and each living thing has the full right to try to remain alive using all means tat their disposal.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aDVHMGLPhow4&refer=home

Bloomberg reported:

July 16 (Bloomberg) — Gordon Brown says he wants the brightest people in the world to come live in Britain. Unless they are Bill Gates, Steve Jobs and Michael Dell, all of whom would be excluded under the government’s new immigration rules.

The founders of Microsoft Corp., Apple Inc. and Dell Inc. are ineligible for the top tier of the U.K. visa system, the one aimed at attracting highly skilled people, because they lack college degrees. The rules, which didn’t require Parliament’s approval, are under attack by lawyers and lawmakers who say the country risks excluding the kinds of people it needs.

“It’s a dumbing-down,” said Sophie Barrett-Brown, head of the Immigration Law Practitioners Association. “If you’re a 20- something American with a bachelor’s degree and you earn 26,000 pounds ($52,000) a year, you’re a high-skilled migrant. You can come in, but Bill Gates can’t.”

The prime minister is trying to reduce the inflow of immigrants after the arrival of more than 500,000 a year for the past five years. The record numbers since the Labour government took office 11 years ago have put a strain on schools, police and hospitals.

Obviously, this is nothing more than head line grabbing journalism.  It is true that Bills, Dell, Jobs would not get HSMP, but they would qualify under other categories of Visa.  Anyone with £250k (sometimes even £200k) to invest in the UK with a reasonable business plan will get a Visa.

As for Gordon wants the best coming to UK, it should benchmark itself against Singapore who dishes out PR in a very practical way, without all those Human Right nonsense to whoever who can contribute to the economy.  One of the reason UK is so scared of non degress holder to come here is because it is still a welfare state and they are dead scared of people coming here to claim benefit.  The human rights and the judges would then prevent any law excluding these new comer from benefits either.

World competition is heating up…UK is now just UK, not the Great Britain, and Gordon should stop speaking or acting like the leader of GREAT Britain.

UK IS WEAK ON TACKLING WHITE COLLAR CRIME AND SHORT SELLERS, SAYS HBOS CHAIRMAN

guardian

http://www.dailymail.co.uk/news/article-1029137/Former-soldier-arrested-kidnap-citizens-arrest-yob-pelted-home-eggs.html

The UK is getting hopeless by the day…

Just back fron Singapore, an Island where most if not all things works and the place is clean.   I was playing with my son at 12:00 mignight at the housing estate (HDB) playground with a good set of facilities (similar to most gyms, not the equipment are not as cushy as those in the gyms, but it is free). And, most importantly, it is safe to do so.

There is also something called Growth dividend there when the government took in more money than budgetted, it redistribute it to its people (poorer get more) in the form of growth dividend. It also save up money for rainy days and use the money to fund infrastructure projects when the economy is down (like now).  Back in UK, our greedy government spend and spend and spend and now it is in trouble, so much so that Gordon is asking the OPEC country to invest in UK nuclear energy power so that UK can buy less oil from them.  Imagine I ask my supplier to invest in, say a more advance piece of equipment so that I would buy less, say, replacement part from him.  Further, Gordon is suppose to be an economist)

Western Society… work harder now before it is too late…

http://burningourmoney.blogspot.com/2008/06/bat-girl-meets-remploy.html

http://batsgirl.blogspot.com/2008/06/naughty-remploy.html

Basically, http://www.remploy.co.uk/  a government agency to help disable people find job asked an applicant (and it is reasonable to expect that many other applicants are asked to do the same thing) to sign some forms with details of the form omitted and with the signature date back-dated so that they can potentially show that the scheme is working.  For this, they offered the disabled job applicants £50 cash (tax payer cash that is it).  To many disabled, £50 is a lot of money and would be happy to go along with the scam.

Where is the Integrity of our government which I pay 5 stars price for ? (and receive  3 starts service)

http://www.thestreet.com/story/10422230/1/did-this-college-admissions-junkie-play-fair.html

To most people, applying to 18 colleges probably sounds like overkill. But, not to Lukasz Zbylut, of Brooklyn, N.Y., who was accepted to all seven Ivy League schools, as well as top-notch institutions like Stanford and New York University to rack up a total of 17 college choices. (The Massachusetts Institute of Technology (MIT) sent his single rejection letter.) And, while he chose Harvard as his destination for the fall, he said no to 16 schools.

Hah..that is Kia Su.  I am not convinced the article claim that other would have lost their chances to enter thse uni as I would imagine most uni would have a backup list of applicants (otherwise, these Ivy League top U certainly have a less than top adminission system - even airlines knows that they need to overbook).

We’re all proletarian nowadays The new reality of economic insecurity is hitting the middle class hardest, says Phillip Blond at http://www.thefirstpost.co.uk/39161,opinion,were-all-proletarians-now

There are a few facts that the author forgot to mention:

(a) There are far more skilled labours than ever before.  Being a lawyer or accountants used to be a great great deal. Now, there are just so many of them.  Economic competition and achievements are all relative - if one can count from 1 to 10 and others can only do 1-5, then his success is lightly to be extremely signifnicant.   Making cards used to be a great deal, but now most countries make them and only the most efficient players like Toyota will do well.  Err…so what we call it ? The struggle of the ‘Car Making Class ?’!

(b) Nearly  all European Advanced Economies (except US) had their REAL PER CAPITA peak GDP (adjusted for inflation) achieved befoer year 2000, some reached their peak in the 1970.  These are of coure caused by various factors, including, as I would argue, the welfare state system whcih prioritise equality over the overall growth.  The Western Sociaist model encourages an outcome of 2 people earning $50, 6 people earning £150 and  2 truly exceptional who managed to bypass the system earning $500 versus a system where 2 people (who are least productive) earning $10, 6 people earning $350 and the 2 people earning $500 (as the two will always find ways round the system).

Labour forces in these countries are simply not becoming productive fast enough or moving up the value chain (and the French even had this 35 hours week rule) relative to their emerging market counterparts.   Being able to write computer programme used to be quantum physics stuffs, but today, there are just so many programmers in India etc.  The relative change in skills have been significant in the emerging economy, but an average accountant in Britain today is not much better than an average accountant back in the 1970.

Anotehr thing that article failed to mentioned is that artifically increase the wages of the workers beyond what their productivitis are worth will result in one of the following two things:

(a) In a close economy, like USSR, the people will be able to enjoy less goods and services and have less purchasing power.  What people tend to think is that, it would be good if ME, as a teacher, earns £100k. That is fine if the chap at Tesco checkout got paid £15k.  If the Tesco checkout chap got paid £70k, this will filter out in the food cost etc and the teacher may not be much better off at all.  The keyword here is relative prosperity.

(b) In an open economy, and as I have mentioned several times - consumers don’t buy a product just because it is British made or US made, but would buy what gives them value.  A worker who moan about his job being outsourced to India is nearly certain to buy a £20 China made DVD over a £80 British made DVD that have exactly the same function. (I read about a survey where China produced electronics are about 4 times cheaper than those made in Western countries)

Further, if the super wealthy are not able to invest their capital productively, then they have one mortal enemy - Inflation. The wealth controlled by the Rockefeller used to be so great, a 1 billion dollar US Steel used to be an unimaginably big companiy, but today wealth controlled by the Rockefeller pale into insignificant compared to those controlled by the Buffet, Gates, the Ambanis etc. The $1bn US Steel is child play today (China mobile is worth $400bn at one point). And the controller of great wealth DID get replaced by newere richest who are more entrepreneurial and creative.

http://en.wikipedia.org/wiki/Wealthy_historical_figures_2008

It is indeed going to be a more competitive world, but the competitiveness also produced lots of goods and services that enhance lives of many.  To try to obstruct the tide of this creative force in the West, and the East would be laughing.  With the competition for resources which the west has no control over.. I dare not imagine the consequences of trying to do otherwise….