Almost there…

Just ten days until I have my last class and 18 until I graduate, in front of Ban Ki Moon, my mum (coming from the UK), Dad, and step mum (coming from the Bahamas). Hard to get my head around at this point!

In the meantime I have to finish writing my Bahamian trade and development Significant Research Project (SRP – sort of a mini, but not in actual fact very mini, thesis…), two final essays for Martin Rhodes’ Political Economy of Globalisation class (great class, in which we have touched on issues relating to the inequality effects of trade, how welfare systems come into being and evolve, the origins and remedies of financial crises, the advantages/disadvantages of different varieties of capitalism…), and a presentation and final paper for Rick Ridder’s International Campaign Management class (our group presentation will see us present a campaign and communication strategy for the Australian Green party going into the elections this year).

In around a month I will return to The Bahamas where I have accepted a job as the Business Editor of one of the two major daily newspapers there, The Nassau Guardian. I’m really excited to be able to put to use a lot of what I’ve learnt in the GFTEI program – international economics, political economy, investment, trade, business, finance, economic development – applying it to the particular challenges in The Bahamas. I was a business reporter before but the GFTEI program has enabled me to gain an in depth level of understanding of many issues that I  lacked and which will position me well to highlight what people need to know about the business and economic landscape in The Bahamas and beyond. Having used some of my class assignments to do research projects on specific aspects of the economy – trade agreements the country has signed, the domestic financial sector, inequality – I feel like I now have a more detailed understanding of some of these key areas which I can use to make sure I ask the right questions and pursue important angles.

I feel extremely fortunate to have been offered the post, particularly as many of my very employable fellow students here at Korbel are finding the job search to be quite arduous. To be sure, people are finding jobs, and it is early days, but I fear that with the combination of the continuing weakness in the economy overall, combined with the US government’s sequester, opportunities are at a low, and competition at an all time high. Networking is definitely more important than ever, and luckily for me, a job as a reporter prior to coming to Korbel turns out to have been an excellent networking opportunity which I have been able to capitalise on now that I am finishing here. I’m looking forward to seeing where everyone eventually ends up… and for them all to come and visit me on my little rock in the Atlantic as soon as possible!

I’m going to write some more in depth reflections on my time at Korbel at some point when I have some more time, but for now, if there are any specific questions that you might have about the school, the GFTEI program, and anything else that might help you figure out if it is the right choice for you, just leave me a comment.

The future is now.

Happy new year, global GFTEI-ers. Wearing a snorkel, sitting in a puddle of mud, screaming for the sun is how this blog post comes to you. Continuing the theme of my last post (climate change, people, climate change) I’m about to wrap up my trip to England during what has been determined to be the “wettest winter on record”. The British isles have basically been transformed into a giant, saturated sponge. But Denver, and winter sunshine, beckons (p.s. don’t believe the “sunshine” in the below UK forecast, I’m looking out of the window right now and the sky is an uninspiring shade of WHITE)

In major GFTEI-relevant news, the US reached a deal to avoid the “fiscal cliff” (otherwise described as the “fiscal hill” or if you are feeling fit, the “fiscal slope”). The GFTEI program is all about exploring the kind of global economic and political linkages that would have made failure to avoid these drastic tax increases and government spending cuts a reason for serious concern the world over. For this reason, I’m happy to see US politicians were, at the 37th hour, able to stop throwing toys at each other and come to an agreement that once again being responsible for global crisis is Not A Good Idea. Kind of like when bored kids on the south coast of England decide to go “tombstoning”, otherwise known as jumping off cliffs into shallow water, for fun. Obama put it mildly when he said, “The one thing that I think, hopefully, the new year will focus on is seeing if we can put a package like this together with a little bit less drama, a little less brinkmanship, and not scare the heck out of folks quite as much.”

Come next week I’ll be back in classes. This time its Financial Systems and Economic Development with Professor Ilene Grabel, Political and Economic Development with Professor Lynn Holland and, venturing over to the Daniels School of Business for the first time, I’ll be indulging in a bit of masochism with an accounting class. Trust me, if someone had told me this time 5 years ago that I’d be electing to take an accounting class I’d have laughed in their face, but it’s true. Working as a business reporter and trying to interpret the significance of financial statements was my first insight into how useful this skill can be (what exactly is the difference between a cost, an expense and a loss?), followed by trying to keep tabs in my incomes and outflows as a student for the second time. Beyond this, I’ve been informed by none other than an Executive Director at the World Bank that having a basic understanding of accounting is a “very useful skill” indeed, professionally and in life… so there you go, 2 hours 2 times a week for 10 weeks of accounting is the result. (In case you’re wondering, Korbel students can take electives in any other school cost free as long as they meet the entrance requirements, which in the case of this class, is a pre-test I have to get 80% in….hmm, should probably be getting back to the books…).

Really looking forward to both Grabel and Holland’s classes.

Grabel’s class builds on her International monetary relations class I took last quarter. It’s about “the relationship between the organization of national financial systems and overall economic performance” , specifically “1) In what important ways do the national financial systems of developing economies differ in terms of depth, regulation, operation and patterns of state-finance-industry relationships; 2) How do a wide range of theories of the role of finance in economic development–ranging from neoclassical, post-Keynesian, neo-structuralist, and institutionalist–link macroeconomic and sectoral outcomes to differential patterns of financial system organization; and 3) What are the lessons of comparative theoretical and institutional study and the current turbulence in global financial system for debates over financial reform in developing economies today?”. If that sounds interesting to you, you my be a would-be GFTEI-er. As far as I’m concerned, it’s “Brain Candy” (to quote a friend). This might also explain why I can’t talk to most humans anymore without getting blank stares and glazed over eyes. Just kidding!…kinda…(it’s a small price to pay for being able to read the Financial Times with a smug look of comprehension on your face, surely?!).

Holland’s class is all about historic and contemporary issues in the development of Latin America. We’re going to look at factors like the role of dependency, neoclassical economic theory (hello Structural Adjustment), class conflict and social movements…more brain candy.

On that note, I leave you with something to tax your Christmas and New Years-addled minds with…a Global Development Game that has taught me I should never volunteer to teach an African geography class. It was also described by one Korbel student that I shared it with as “the most exciting thing that has happened to me all break”. But that might be building it up a little bit too much…

Click here to let the geek times roll.

The English coast…fancy a swim?

The real apocalypse

Well it’s December 21st and the world continues to turn. Apparently the Mayans got it wrong, and/or we misinterpreted the Mayans. I am, however, prepared to believe there’s something in this catastrophic forecast. This time last year I was actually at one of the world’s most impressive Mayan sites at Tulum, Mexico, in the Yucatan peninsula, and an ill-advised sipping of water from my hostel’s water cooler turned into a truly disastrous 3 day stomach bug which threatened to cause me to waste away before I made it to the Christmas dinner table. Meanwhile this year, I am in London and suffering from tonsilitis which is stopping me from continuing my travels around London to catch-up with old friends. Clearly something is not right with the world. However, I’m guessing this wasn’t the level of “apocalypse” the Mayans had in mind.

What this whole apocalypse thing did get me thinking about is another kind of death of “life as we know it” scenario which is in fact taking place around us every day, which is self-perpetuating, and which we should be maybe a little more concerned about than a type of fireball-induced death we apparently had little chance to deter. Climate change, people! Climate change…

Is it possible that in today’s age of science and enlightenment, we continue to do as little as we are to address this quite certain form of impending doom?  Apparently so, if the entirely uninspiring outcome of the recent Doha conference on climate change represents our best efforts. This should be a source of concern and fear for everyone on this earth (although those of us who have citizenship of the type of low-lying country which, according to most predictions, may well be underwater by the end of this century unless absolutely drastic action is taken perhaps have reason for even greater concern than the rest…).

It is not as if we don’t have the means to adapt. It’s what we’ve been doing throughout history. If we can take pictures from Mars, we can find ways to live more sustainably, and to generate our energy on a large scale from the amazing renewable technologies that have already proven their viability on a scale that we would have previously thought unimaginable. It’s all about the will, and overcoming vested-interests and the world’s greatest collective action problem.

I liked this TED presentation given by David Roberts about the issue, recorded earlier this year. Watch it if you would like a 15 minute call to action for why we need to act now.

As Roberts states, summarising scientific consensus to date, “There’s plenty of complexity for those of you who like complexity. But we now know, with a fair degree of certainty, that if we keep doing what we’re now doing we’ll face unthinkable catastrophe. That’s the take home message. Saying ‘I don’t want to talk about that because I don’t know the ins and outs’ is like saying ‘I don’t want to raise alarm about Hitler’s army being 100 miles out because I don’t know the thread count of their uniforms or the average calorie intake of a German soldier’. You don’t need to know those things to raise the alarm and to be scared about it. Similarly, if we keep doing what we are now doing, we are screwed. This is what we know now.”

To stabilise temperatures (or in David Robert’s words, “to ever have a hope of ever having a stable temperature”), global climate emissions need to peak – stop growing and start falling, rapidly – in the next 5 to 10 years. According to the International Energy Agency, every year we delay acting we add an additional $500bn to the investment that will be required to tackle climate change.

So there’s our not-so-Mayan apocalypse, one which, unlike the Mayan version, has been backed up by mountains of scientific evidence but has still failed to get the same kind of media attention of late.  Each one of us can make a difference by looking at how we impact the environment through our consumption (I certainly could be doing much better, it must be said) and we can use every opportunity we get to try to steer political discussions towards this issue.

I myself plan to pen an article soon calling for The Bahamas government, as the government of one of the world’s most threatened states, to do more to raise awareness about the necessity of action on climate change by ourselves and on the part of the international community if we are to avoid destruction in a relatively short period of time. So far, our new government has not uttered the words “climate change” as far as I can tell. Global economic crisis or not, this cannot be sidelined.

(As a final point, I personally believe that a huge part of tackling climate change comes down to individual state’s decisions to provide the type of enabling legal/regulatory/investment environment that incentivises investment in renewable energy. This is far easier to achieve than action on a global scale, although this is also necessary. On this front, there are few excuses but political ones in many cases…especially that of The Bahamas where, in a land of abundant and potentially energy-producing sun and sea, electricity costs are as much as 383% higher than that of Florida, leaving the cost of renewable energy as a total red herring in the discussion over its viability in that environment. Check out this ranking by Castalia consulting and the Caribbean Renewable Energy Forum if you want to get a truly startling picture of how different Caribbean countries now rank on their efforts to encourage renewable energy).

Hurriween / Hallocane

It’s been a while, but I’m back. In case you were wondering what’s been going on over here since my last post, several highlights are as follows:

• Questioning the head of the US military’s “Africa Command” about Libya and African security threats during a recent visit to Korbel. Specifically, given that he identified the instability that has resulted in the post-Gaddafi Libya as one of the African security situations about which he is “most pessimistic”….does this not give credence to those who opposed the invasion of Libya? General Ham said he thinks often about whether he would change the US course of action, but ultimately feels it was justified. “At least, in the beginning”. Hmm…

• Continued bombardment in the run up to the US Presidential Election on November 6th. As a “swing state” which went for Obama in 2008 after decades of voting for Republicans, Colorado is one of those high value targets (to continue using military buzzwords) that the campaigns have felt it economical to douse in a million campaign ads daily. Meanwhile non-swing states enjoy TV just like back in those simpler times we in the swing-states took for granted, when info-mercials about how to get a “brazilian butt” and how to chop things really fast ruled the ad breaks.

When I switch on the TV…campaign ads….Pandora…campaign ads…. Facebook…campaign ads…Let’s just say this little girl sums up the mood nicely:

• Hurricane Sandy hit The Bahamas…forcing my friends and relatives to take shelter for days on end, as it moved slowly over the archipelago. Living up to its name, the hurricane somehow managed to deposits tons and tons of sand across the island, in addition to the dramatic flooding. Its’ impact on the US East Coast has an apocalyptic feel to it… and I hope for everyone’s benefit that it creates some real discussion about the reality of climate change. New York’s Mayor Michael Bloomberg’s endorsement of Obama for Presidency today in light of his belief that it is Obama, rather than a Republic administration, who is most likely to address the issue of climate change, is a good starting point. This is one campaign boost I hope Obama remembers to pay back with some favours if he gets back in office, for all of our sakes.

• Last but not least, Halloween struck, and in true Korbel style, the occasion could not pass without some elaborate costumery, notwithstanding the week 8 academic pressures that are bearing down.

Here’s a selection of hurriween / hallocane photos. I wanted to separate these because they are not exactly in the same spirit, but WordPress said No.

So here they are, jumbled up….(One day technology…One day!!! *shakes fist at the sky*)

Inequality

During my time at Korbel I was introduced in an academic way to the concept of inequality. As a result, I ended up doing a paper on it for one of my classes, and following that, I decided to look at the issue of inequality in The Bahamas.

Here is something I wrote for The Tribune in Nassau, Bahamas, about inequality. Let me know what you think.

 

The Bahamas is Becoming Increasingly Unequal

By ALISON LOWE

Nellie Day – remember her? She wrote an article claiming that the majority of Bahamians live in shacks made of straw and wood, while a wealthy elite can afford mansions made of concrete and strong enough to withstand a hurricane. Her clearly poorly-researched and shoddy article appalled The Bahamas at large and soon after it was removed from the US-based travel website where it had been posted, and the author was forced to issue an apology.

While Nellie Day’s claims were clearly enormously exaggerated, there is an aspect of our development experience which her controversial article touched upon which may in fact hit somewhat close to home The factual accuracy of her article notwithstanding, Day did what something our politicians might do well to do more of: talk about inequality. Inequality is an often-cited aspect of development, but it is scarcely mentioned in The Bahamas. What actual evidence is there for what inequality looks like in The Bahamas, and should we care either way?

Data is scarce (The Bahamas and the Caribbean as a whole is what has come to be termed a “data poor region”, which severely impedes progress in policy-making) but I did find something to answer my question – and the findings are troubling. A country’s Gini coefficient measures inequality, on a scale of 0 to 1, with 1 representing total inequality. The Bahamas has the highest inequality in the entire Caribbean, according to a recent study by the United Nations Economic Commission for Latin America and the Caribbean, with a Gini coefficient of 0.57. Secondly, inequality is only increasing.

In the Department of Statistics’ most recent Labour Force Survey, a graph showing trends in income distribution from 1973 to 2011 shows a laudable closing of the income inequality gap from one of quite severe income inequality in the Bahamas in 1973 to a vastly improved position by 1989. However, the next point at which data is available – 1999 – shows that the 1990s were a turning point for income inequality trends. From 1999 onwards, income inequality has been increasing in The Bahamas. That is to say the rich hold a higher proportion of overall income in comparison to the less well off. To be clear, the increase is not massive, but it is a negative trend. Meanwhile, data also shows that the share of the overall wealth of The Bahamas held by the poorest 20 per cent of the population has not changed at all in percentage terms in at least 38 years. While their absolute household income has increased the bottom 20 per cent’s share of total household income has remained in the vicinity of 4 – 5 per cent. .

My intention in writing this article is both to bring these facts to the fore, and to suggest that inequality is something we should be talking about as a society. Firstly, I believe it would be beneficial to consider what took place in the 1990s that may have contributed to this negative trend emerging. At first glance, the growing gap seems counterintuitive, considering that the ‘90s saw the Atlantis resort come on stream, in what has been talked about by many as a moment which contributed to the emergence of a substantial middle class in the Bahamas. Secondly, what does high and growing inequality say about the health of our nation and its future development? There are many well-respected academics and policy makers who tell us that a society with high levels of inequality is more likely to suffer from lower growth, higher crime and poor health and to be generally less happy. Thirdly, how can we stop, slow or reverse this trend? And should we?

As we consider these questions, it is worth noting that the economic crisis is likely to have significantly worsened this inequality. Indeed, the evidence is already being seen. In a shocking report in January 2012 which received far less attention than the seriousness of its contents warranted, Tribune business editor Neil Hartnell pointed out that Department of Statistics figures show that the number of Bahamian households surviving on less than $5,000 per year has increased by an “alarming” 83 per cent in the past four years. Additionally, between the years 2007 to 2011 there has been a 33 per cent or one third increase in the number of households earning a total of $20,000 or less, with the number of such households increasing from 24,780 to 33,015. It is possible that the wealthy have also lost out to an extent, but with a greater safety net, more secure jobs and income-yielding assets their fall in income will not have been nearly so great. This has been the trend worldwide – it is the less well-off, those who are already more vulnerable, who have fallen the furthest due to the economic downturn.

But why should we care? There are several very good reasons which are commonly advanced. While I will not attempt to definitively link these issues to inequality, I think it is certainly worth considering them, given that academic and public policy reports worldwide have found that there are strong reasons to believe that the interconnections are very real.

The first is crime. In one of the most comprehensive reports to ever have been produced on crime in the Caribbean, a 2007 joint report of the UN and the World Bank, “Crime, Violence and Development: Trends, Costs and Policy Options in the Caribbean”, the authors describe the disastrously high levels of crime in the region and find evidence to suggest that countries with higher levels of inequality have higher rates of both murder and robbery, no matter their overall level of wealth. This is not to say that other factors do not come into play – indeed, it is likely that crime grows through some of the same channels that contribute to inequality (such as structural unemployment and poor education outcomes) , but it is also possible that the mere fact of inequality becomes an independent source of crime.

The second reason to care about inequality is its possible long term economic implications. Some argue that efforts to make a society more egalitarian will come at the expense of economic efficiency and growth; that it is through being able to reap large rewards that the wealthy will go on to spur further growth through investment and innovation and, if not, the economy will be stifled. Others suggest this is a fallacy. In his own article trumpeting the need to redress America’s income imbalances, Nobel Laureate economist and former chief economist for the World Bank, Professor Joseph Stiglitz of Colombia University, points to countries such as Sweden which are both economically healthy and the most “equal” of all modern economies. In one of his own recent articles on the topic of inequality, Stiglitz states that overall it is “well documented that countries that are more unequal don’t do as well, don’t grow as well and are less stable.” For one possible reason why this might be, we only have to link this back to the UNODC report’s connection of inequality with crime, factoring in the impact of crime on private business activity, on human capital, and crime’s ability to encourage brain drain – the urge for those with the intellectual and material capital to leave the country and perhaps never come back – to see how inequality could cut growth. Add in the impact on health and education of a large group of people getting stuck at the bottom of the ladder and how this would affect their ability to contribute to economic activity and there is further intuitive evidence of why inequality may hurt growth and stability.

You might also consider how higher levels of inequality can signify less “equality of opportunity”, such that children born of poor parents are less able to live up to their potential, or as Stiglitz puts it, how “lack of opportunity means that a country’s most valuable asset – its people – are not being fully used”. Here he was referring to the situation in the United States of America, where inequality is the highest in the developed world, and, according to Stiglitz, is now at such an “intolerable” level that the country will “pay the price”. But in a country with as few people as The Bahamas it is arguably even more important that we ensure that each person  can live up to his or her full potential to contribute to our society.

Reinforcing Stiglitz’s observation, with regard to why high inequality in the US is indeed a problem, the Organisation for Economic Development and Cooperation (OECD) warned the US in June that it must fix its inequality level, noting impacts on health, education, innovation, and economic wellbeing. Meanwhile, the extent of inequality in the U.S. is one of the main messages of the “Occupy” movement, which has managed to play a major part in bringing the issue into the mainstream agenda and political debates. “Occupy” complains, and Stiglitz also contends, that inequality distorts political outcomes as those at the top gain a disproportionate voice in the political process. When this occurs, both democracy and economic growth are undermined, as “rent-seeking” behaviour causes those who already have wealth to bend political outcomes to their own benefit rather than that of the economy as a whole.

As for what the data may tell us so far, it is hard to decipher exactly what role, if any, inequality may have played in stymying economic activity in The Bahamas. Between 1980 and 1990, GDP growth averaged 3.5 per cent in The Bahamas, while between 1990 and 2000, as inequality stopped narrowing and began to grow, it averaged 1.85 per cent. From 2000 to 2010, as already high levels of inequality trended higher, there was an average of only 0.84 per cent growth, but this period also saw both the effect of the slowdown in tourism following 9/11 and the global downturn post-2008 financial crisis. Overall, from 1980 to 2011, growth averaged a low 2.11 per cent. Given that the increase in inequality beginning in the 1990s was only a minor one, I would suggest that it would have been unlikely to have had any major effect on economic growth over and above these other global factors to date, but this is not to say that in the long run, and with a continued worsening of inequality levels, it could not have an impact. 

Potential social and psychological implications of inequality should also factor into the debate. We must consider how high inequality could lead to a deterioration of social cohesion within a society, which is the foundation upon which “democracy – or, indeed, any type of peaceful, contented society – ultimately rests.”, as recently stated by Robert Skidlesky, famed biographer of John Maynard Keynes, and Professor Emeritus of Political Economy at Warwick University, U.K. Skidelsky is one of many eminent social scientists who have raised red flags in recent years about the effects of inequality.

As for why inequality in the Bahamas may be on the rise, there are several potential causes which spring to mind. Firstly, our economic model as a whole. We have traditionally sought to attract high net worth individuals to The Bahamas to set up residence. As “usual residents”, some of them and their particularly large household incomes will have factored into the Department of Statistics report of November 2011 in which the trends in inequality are perceptible. We may want to consider to what extent the inequality which causes us to be ranked the most unequal in the Caribbean is due to this fact alone, or due to other more systemic issues.

A systemic issue affecting income inequality is long-term structural unemployment. Structural unemployment is joblessness that comes about due to a lack of fit between the skills individuals have and the jobs being created. Between 1995 and 2011 the average unemployment rate in The Bahamas, notwithstanding the rise of Atlantis and the relative boom period of the mid-2000s, remained at a stubborn 10 per cent. Hence although in economically good times, jobs were being created, there remains a core group of individuals who are not suited to benefit from them. In this regard, if we care about inequality, this is yet another reason to focus on education and to what extent our inadequate education system is growing this proportion of the population, as business leaders commonly complain, and therefore contributing to further inequality today, and into the future.

Taxation surely must bear some of the blame, too. Just this week we have seen the announcement of a forum to discuss future taxation options for the Bahamas, with one of the recognized reasons why this is needed being the question of “equity”. As it stands, the Bahamian taxation system which relies most heavily on tariffs on imports for revenue creation, is regressive. The poor pay relatively more of their salaries in tax than the rich. When you take more money out of the pockets of the less-well-off, you not only limit their disposable income, but you reduce their pool of resources which they can save towards options like college for their children, or investment in property and other income-generating assets, for example. By allowing the wealthy to pocket a greater share of their incomes, you leave them with yet more options for investment in activities that will increase their incomes further. Additionally, by continuing the use of a taxation system that in general sees this nation collect a lower-than-average amount of revenue as a proportion of GDP than other countries, as the tariff-based system does, you limit the ability of the government to potentially engage in meaningful public investment that will benefit the most vulnerable. All of this has a knock-on effect on social mobility and inequality in the long run. Similarly, the lack of an inheritance tax allows the wealthy to pass on money and property to their heirs without paying any tax on these assets, as would be the case in many jurisdictions worldwide. This too will perpetuate and even have a “snowball” effect on inequality in The Bahamas. Children of the wealthy can receive property and money that they in most cases played no part in producing/obtaining, increasing their options and life chances with no input of their own, without making any contribution to the state which might wish to take redistributive steps to assist those whose initial life chances are not so rosy.

The Bahamas has taken significant steps on its development path, but high and rising inequality has been a largely un-discussed side effect of our progress over the past several decades. If unaddressed, some experts would say it will derail our progress and turn back the clock on the advancements that we have made. Or it could be that inequality has little to do with our most serious problems. But as the country with the highest inequality in the Caribbean that continues to rise, isn’t it time we talk about it?

 

Do as I say, not as I do?

It’s always fun to find evidence of hypocrisy and realpolitik laid bare in the news… On one front you have the US government pandering to domestic constituencies and trying to eek out advantage for its companies by appealing to the Gods of Free Trade and Fairness, while on the other, you hear examples of its own disregard for Free Trade norms. It essentially always comes down to who has the bigger stick.

In this case, China has a very big stick, and the US has a pretty big one too, so we’ve got quite an evenly matched pairing. Today’s spat sees the US accusing China of plying its car industry with “illegal subsidies” that are accused of making US car producers noncompetitive and forcing the outsourcing of US car manufacturing. President Obama has been bashed recently in the presidential campaign by Republican candidate, Mitt Romney, for being too “soft” on China (whatever that may mean…) and so for him this is clearly a strategic move.

The gem of this piece, however, is the quote from the White House spokesperson who tells us from his extremely high horse that “The key principle at stake is that China must play by the rules of the global trading system“.

Meanwhile, down in the Caribbean, a gathering of micro states with comparatively tiny sticks is calling on the US to do the same thing.

Rum is a historically Caribbean product, linked to the production of sugar cane which began with colonisation. It wouldn’t be an overstatement to say it’s also a way of life in the Caribbean, not to mention a major source of foreign exchange and tax revenue, to the tune of around $750m annually.

But all this is under threat now, because of the very same “illegal subsidies” that the US is handing to its rum producers in Puerto Rico. The US gives back the excise tax raised on sales of Rum from Puerto Rico and the US Virgin Islands to those territories, who then distribute it to producers as a subsidy to their production.

For Diageo PLC, which makes Captain Morgan rum, this will amount to $2.7billion over 30 years in handouts from the Puerto Rican government, and this is but one of the ways in which its production is made cheaper by US government intervention that has increased significantly in recent years.

So far Caribbean community governments are seeking to talk it out with US, going for a “negotiated settlement” over the issue, when they could have threatened the US with a World Trade Organisation (WTO) trade complaint, as the US has done with China over its “illegal subsidies” to its car industry. But of course, their sticks are smaller, and they depend very heavily on the US economy in so many ways, that the Caribbean governments so far have not taken this step.

Exactly where this “negotiated” deal over the US’s massive subsidies to its rum producers stands today, it is not clear, but what is clear is that if it continues for much longer, Caribbean rum producers, the jobs of all of those who they employ, and who work at companies which supply them with their raw materials, will come under increasing strain, and may even be forced out of business after hundreds of years of production. This is the last thing the economically vulnerable Caribbean needs right now. Faced with all sorts of structural challenges, and continuing to battle with the fall out from the US-led global financial and economic crisis, most Caribbean states have seen unemployment rise, government revenue fall, and public debt climb to Greek-style levels in many cases.

This case is also interesting from the point of view of The Bahamas, which was the Caribbean base for much of Bacardi’s production until several years ago. Today The Bahamas remains the only country in the western hemisphere to have not joined the WTO. This means that, if we had interests which were threatened in this case, we would not be able to make a complaint through the WTO on the matter, meaning our producers’ interests would be at a severe disadvantage.

This is why it is important that the Bahamas continues to push ahead with WTO accession, since without it, it will (as Trade minister Ryan Pinder has pointed out) be all the more difficult to sustain those producers who are currently in the Bahamas or to attract new ones, as we hope to do.

Crystal balls and P-values

I wanted to take time out to talk about something that is getting me pretty hot under the collar these days and it’s not what you would expect. Well actually maybe you would expect it, because by and large I come across as an even bigger nerd in this blog than I even am, which I am starting to realise is quite a feat, but still…here goes:

Remember how I said that Econometrics was my most challenging class this quarter? Well that’s still the case. Econometrics is defined as “the application of mathematics and statistical methods to economic data” and is described as the branch of economics “that aims to give empirical content to economic relations.” You begin to get the picture, right? Art class this aint (and that’s coming from someone who took Art up until my final year in school….Including a 12 hour final “painting” exam! Ha ha ha…)

Thing is, now that we’re further along in the class I am beginning to see the applicability and utility of this discipline and the software that goes with it (STATA) such that I have to say I am actually pretty genuinely excited about using this more in my studies and potentially in a future career.

That’s not to say I don’t also respect the arguments from people like Professor Deirdre McCloskey (see earlier blog post regarding the transgender, libertarian economist who came to speak at Korbel earlier this year) who say that this discipline is dangerous if the output of these mathematical contortions is applied without due consideration of the real life, economic and social impacts in society. But as someone who feels that policy making WITHOUT adequate analysis of related data (e.g. trying to solve health, education or crime-related problems without looking at what factor into those trends from a quantitative perspective) is likely to be futile if not outright negligent… the realisation of the greater level of understanding and insight we can obtain about an issue through econometric analysis is really encouraging.

For example, The Bahamas just had an election last Monday. The incumbent government lost badly, winning only 9 seats to the new Government’s 29. Among other things, spiraling crime rates are being blamed. The murder record each year for the last five years has broken the previous year’s record. The question is, what can be done to tackle this issue?

I’m hoping I might be able to get an insight into this issue in my econometrics class of all places. I plan to run an econometric analysis where I will determine the relationship between factors such as tourism, government spending on police and perhaps other areas, unemployment rates, foreign direct investment inflows and the violent crime rate across a series of years. In doing so, I expect to see which of these factors has the greatest impact on decreasing the crime rate – – for example, is it simply whether you have a job that matters, or if the government is spending more on the police to control bad behaviour? If so, what impact would increasing government spending on police have on the violent crime rate? (Here’s where the crystal ball comes into it…).

Anyway, I really hope I come up with something significant in my findings and can make some useful projections about what kind of policies might flow from that to try to bring down the crime rate. Or at the very least, some reasonable recommendations on further research from which I or someone else could get an even better insight into how we can begin to tackle this scourge. Or I might choose the wrong varibales, totally misinterpret my output and fail miserably…fingers crossed it’s not the latter. Either way, it’s a learning process.

On an unrelated note, I just discovered that wordpress now compiles information on which countries those who have viewed this blog were located in. Turns out since February 25, 2012, people in 54 different countries have seen the blog. I think in some cases it will come up when people are just searching certain keywords or images, but still pretty cool to think of my rambles popping up on screens across the globe. Greetings!

Here’s a snapshot of the top countries….

Meanwhile, back in the islands….election fever boils over

In one day, the governance and political landscape of The Bahamas has been turned upside down! Today was election day in the archipelago of islands I call home, and perhaps I was naive to think that somehow the Bahamian incumbent government was unique in this global economy and would potentially withstand the tide that has swept (in all but a couple of days) Governments in France and Greece out of power. But thrown out of power they were. In somewhat of a landslide. It was probably the most interesting election in 20 years – since that which ousted the longstanding Prime Minister Lynden Pindling following a decade of corruption allegations related to the booming cocaine trade that flowed through The Bahamas at that time.

A third party entered the fray, the DNA, led by a breakway former cabinet minister of the current Government who many considered to be charismatic and with leadership potential. His partner garnered a decent quantity of votes for newcomers, primarily seeming to take them from the incumbent party and in this sense acting as a bellweather of dissatisfaction with the state of affairs at large more so than a viable governing party.

Meanwhile, the two former law partners, Prime Minister Hubert Ingraham and former Prime Minister and PLP party leader, Perry Christie, both in their 60s, battled it out once again. At one point, online commentators were aghast when it looked like HAI (Hubert Alexander Ingraham) had even lost his set in the North Abaco constituency – one he has won for 7 consecutive terms and about which there had been little to no anticipation of him losing. Several cabinet ministers lost their seats. And with little delay, characteristic of a man known for his decisiveness, HAI suddenly conceded the election, announcing in the process that he would be resigning – both the seat he had just managed to win, and as the leader of the party. He would be leaving public life and starting his private life anew. Some simply can’t believe it and began making apocalyptic predictions on Facebook. Others expressed respect for what they perceived to be the right move given failure to lead the government to re-election. While supporters of the victorious PLP suggested cowardice and an unwillingness to go before parliament in the face of defeat.

Christie…..Ingraham…at it again.

All of a sudden the party which has governed the country for the last five years (and HAI was also PM for 10 years in the 1990s- 2001, making him Prime Minister for a total of 15 years) is both out of power, and truncated, without a clear leader, deputy leader, or hierarchy of any type. But perhaps this destruction will lead to some creative innovation, and our democracy will be stronger for it. I personally believe HAI will continue to “lead” the FNM from behind the scenes, playing a huge role in an advisory capacity. Health Minister Hubert Minnis is now touted to be the next leader. We shall see. I just hope that the new Government has a vision and a plan to execute it in still turbulent economic times, and to curb ongoing annual murder records. Joblessness and crime are surely two of the biggest reasons the FNM lost.

What I would like to know now is what this means as for the PLP’s pre-election promises to re-located the main shipping port, the placement of which it did not agree with, and to renegotiate or rescind the deal struck with Cable and Wireless to take majority ownership of the formerly state-owner Bahamas Telecommunications Company. These are major deals with major implications for the economy, and I would hope that rash political moves are not made. I am also concerned about what will now take place in relation to oil drilling in The Bahamas… the PLP was for it, the FNM (belatedly) against. There will certainly be a lot of pressure coming from international investors to push ahead with this. But can we handle it? Avoid a BP like oil-spill in our pristine waters, which have to date sustained tourism, our only fairly consistent source of GDP?

No to oil driling, thanks very much.

So this is what distracted me from finishing my Statistics methods section tonight for a research paper. At the moment, work is non stop, with a research paper to plan and execute in both Statistics and Econometrics, and a final to complete for my Capital Markets in Africa class by Friday. Meanwhile, a dozen extracurricular demands are also bearing down. But so far things are remaining in hand…… that is to say, sh*t is slowly approaching, but yet to make contact with, the fan.

As per usual, all of the above has not meant I haven’t had time to attend some more fantastic talks and events organised through Korbel. Russian Ambassador to Syria, Vitaly Churkin, came to Korbel a week and a half ago. However despite offers of money, beer and other incentives, I did not go ahead with my proposed plan of asking him “What it is like to work for the manliest man in the world” (on that note, did you see what Putin went ahead and did a day or so after being sworn in again as President? Oh just a little Judo/body-slam sesh with the Russian national judo team… as you do). I do believe I will regret that for the rest of my life. But anyhow, you live, you learn. He talked about vetoing action on Syria, and about the other occasions he has used his veto on behalf of Russia in the security council, about Russia’s relations with NATO, Europe and the US, and even got us laughing about how Putin made a “little change in the constitution” to allow him to be President for 6 years now instead of 4. Must be a good Ambassador to make us laugh about THAT, right?

Vetoing action on Syria? You’ve got to be churkin.

The next day was a workshop organised by the UN Association of Denver, in conjunction with the UN Foundation, about Myths and Reality surrounding the work of the UN, regarding climate change, international law and justice, women’s rights, peacebuilding and other critical areas of global concern. I attended the climate change talk, and the international law talk, and learnt a lot in both. Timothy Wirth, President of the UN Foundation, provided the keynote speech which was a great insight into the work of the UN Foundation (****NEWS FLASH****They PAY THEIR INTERNS!!!***), an organisation I must say I didn’t know much about. The UN Foundation was set up with a $1 billion donation (yes, that’s what I said…..ONE BIL-LI-ON DOL-LERRRRSSSS…said in Dr Evil voice…) from media mogul, Ted Turner, in the late 90s. Their Board of Directors could be better dubbed the Non Profit All Stars, consisting of people like Kofi Annan, Mohammed Yunus (guy who invented Microfinance, FYI) and others of similar stature. The UN Foundation basically supports the work of the UN, building partnerships and mobilising resources and people for change on issues such as global health, climate change, and women’s empowerment (the latter of which, by the way, Wirth called the most intractable of all issues the foundation has sought to impact….that’s right….getting women to be treated as equal human beings….harder than reversing man made climate change. Huh). You should’ve seen the look on Korbel students’ faces when Wirth said that one of the major challenges facing the UN is how it is going to fill the gap left by a nearing retirement-age generation of UN specialists and bureaucrats. Um, Mr Wirth….we’re over here! Duh.

Lastly, a brilliant lecture by GFTEI co-director, Ilene Grabel, rounded off the week’s festivities. Prof Grabel was awarded the honour of giving the 2012 University Lecture, which is in recognition of scholarly achievements/groundbreaking academic research.

Her lecture was titled, “Not Your Father’s Crisis: Productive Incoherence, Development Policy Space and the Global South”. She discussed her work on how the 2008 global financial crisis has led to a promising and ongoing period of “productive incoherence” in which developing countries in the global south which have traditionally been subject to demand for greater financial liberalisation (removal of capital controls on capital flowing in and out of the country, for example, as a dogma of the IMF) are now experimenting with a wider variety of policies on this front and, most surprisingly of all, with the quiet approval of the IMF itself, despite its traditional opposition to such attempts. Asian countries have taken steps towards setting up their own “IMF alternative” by stockpiling reserves to safeguard themselves and each other from future financial crises and emerging economies are now becoming net lenders to, rather than borrowers from, these multilateral financial institutions. All of these developments may well lead to the most significant pressure yet for the IMF to reform itself to become more amenable to increased policy space for developing countries and consequently, says Grabel, to the opportunity for sustainable development therein. What’s great is that in listening to Grabel, you know you are hearing from someone who is really on the cutting edge in her field and has the ear of some very influential global institutions. Oh and she’s just super nice. I’m not even making that last part up. Totally psyched for her International Monetary Relations class in the Fall. Not making that up either.

Goodnight, whoever you are.

Here, there, and everywhere….

Facebook stati are an easy place to get hyperbolic, but lately there’s been many examples of some pretty genuine reasons to be overly-excited amongst my Korbel peers…

It’s that time of the year when hours spent piecing together applications, recommendations, transcripts and statements begin to pay dividends as we hear from that Goat Conflict Research Facility in Southern Nepal that yes, they will accept us to go and live in their hut for three months and study the conflict between the lesser-known Capra Aegagrus Hircus and the surrounding villagers. That’s right….it’s internship selection time.

Internship selection time is somewhat like Christmas for students like us, except actually with a much greater likelihood that you might get something you want, or at least expect, but without the embarassing requirement to try it on in front of your whole family and feign excitement (If you’re reading this, Aunt Gail, I really did like that dress… it’s just a badly constructed analogy…).

If I remember correctly, some of the recent “!!!!!!!!” moments in Facebook, relating to internship news, have included: Fiji, Uganda, Ecuador, Nicaragua, South Africa, Japan, Kashmir, Guatemala, India, Mexico, Bosnia, Namibia and the most exotic of all……DC. This makes the wait all the more nervewracking for those who have yet to hear back… but based on the showing so far I would say we all stand a pretty good chance of getting in somewhere at least somewhat relevant, and if not, you can only hope something will come up in some far off land that will be enough of an experience in itself!

In other news: On Friday, the Russian Ambassador to the UN (Vitaly Churkin) will be at Korbel to give a talk. Still not quite sure how these people end up here, but not complaining whatsoever! Churkin is obviously taking a break from vetoing security council resolutions against Syrian abuses. Meanwhile, on Monday, Fidel Castro’s daughter, Alina Fernandez(an outspoken critic of the communist regime and Miami tv show host) will be on campus addressing whomever may be interested as part of International Celebration Week. Again, not sure who orchestrated that, but I’ll definitely be showing my face to see what la Cubana has to say.

"Dad, I'm gonna tell Denver on you...", courtesy of AwkwardCommunistFamilyPhotos.com

And back in the Bahamas, there is but just over a week before my fellow Bahamians go back to the polls for the first time in five years to see if they want to re-elect incumbent Prime Minister Hubert Ingraham for a fourth non-consecutive term, despite a down economy, choose lacklustre and late Opposition leader Perry Christie for a second non-consecutive term, or go with the wildcard third party which has gained some traction in the race by capturing the imagination of many who are disillusioned with the status quo. I unfortunately will be disenfranchised this time around, as although the current government did take the laudable step of introducing some type of overseas voting, this will only be taking place in DC, Atlanta and Miami, and I cannot afford either the time or the money to visit any of those places to cast my vote on May 7th 😦

More on the election after I catch up on some sleep. Hasta luego

Kornblum at Korbel: Crisis and Peril in the Eurozone!

A lot of students at Korbel are looking to find their way into the Foreign Service, and it’s not hard to see why. For one, Wikileaks has taught us that to a great extent, Foreign Service Officers, who live abroad serving in US Embassies all over the world, promoting US interests, spend a lot of time basically gossiping and socialising…

They go to parties, they meet, they chat, they “do lunch” and “have coffee”, and gather juicy tidbits of information about characters and events that they then type up in flowery language and shoot off to their bosses back in DC (I am thinking now in particular of some Wikileaks cables from the US Embassy in my home The Bahamas which I saw, concerning the impact of a certain now-deceased busty blonde, Anna Nicole Smith, wherein the higher-ups were told: “Not since Category 4 Hurricane Betsy made landfall in 1965 has one woman done as much damage in Nassau!”. O Rly US Embassy? Slow day at the Office?). Aside from that, they also get to be involved in the world of international affairs on a global level, live all around the world and immerse themselves in different cultures. Not a bad living, if you can make it.

Anna Nicole Smith: Havoc Was Wrought

So for this reason and many others it was a real treat for Korbel Students when former US Ambassador to Germany, John Kornblum, flew over to Colorado from his home in Berlin to participate in a talk on the importance and future of Europe. Mr Kornblum first spoke by himself at a presentation I was unable to attend on Thursday, and then alongside Korbel Professors Rachel Epstein and Martin Rhodes at a roundtable on the Eurozone Crisis on Friday (which just so happened to be moderated by our Dean, Christopher Hill, the former US Ambassador to Iraq). Prof. Epstein and Prof. Rhodes are now heading up Korbel’s Center for the Study of Europe and the World, which aims to deepen the engagement of Korbel with this now particularly tumultuous region of the globe.

Ambassador Kornblum served the US for 4 years as Ambassador to Germany between 1997 to 2001, with this being the mere tip of the iceberg for him professionally, capping a 35 year career in the foreign service which saw him deeply involved in hugely historic events. In fact, he orchestrated President Reagan’s “tear down this wall” speech at the Brandenburg Gate in Berlin in 1987. (So perhaps a little bit more substantial than the work of the foreign service officers I used to come in contact with in The Bahamas when I worked there….;)

Ambassador Kornblum: A Jolly Fellow

Which was why it was so interesting to hear his take on the Eurozone Crisis that continues to play out across the Pond.

Hindsight is ofcourse, 20-20, but to hear Europe experts talk about the apparent folly of the creation of the European Monetary Union really is incredible. The project was too much a “political and emotional” one, we were told, guided by a now-clearly misplaced feeling amongst European policymakers that the region, united, could become almost like a “utopia” – “socially and economically engineered” for the betterment of its people, according to Rhodes.

All of this, however, disregarded certain critical economic factors – the conditions did not exist for an “optimal currency area” (that is economist lingo for what are deemed to be the conditions necessary to make a joint currency feasible in reality amongst many different countries – a joint currency like the EURO, that is). No, instead the policymakers had some strange idea that they could come to this position through the backdoor – that by creating a European Monetary Union (EMU), they could create the optimal currency area necessary for it to work. “We’ll get to that part later”, you can just imagine them saying to each other whilst chomping on croissants and patting each other on the back.

Type "Croissant Utopia" into Google and this is what you find...

“Very rash decisions were made and quite a few chickens have come home to roost,” Prof. Rhodes told those gathered at the CSEW event. “They believed the continent and its institutions were ready for a massive leap forward that would bring more public goods for all.”

The major problem with all of this was the Europe was then, and is today, made up of a group of very different countries, which were operating at different economic speeds. Germany has been very competitive economically for many years – “the Mercedes Benz” of European economies, said Rhodes – whilst countries like Greece, Spain, Portugal, Italy and so forth had larger debt burdens, were less efficient economically and generally less productive. Think Greeks and their hugely generous public pension schemes, retiring at age 32 (ok, not quite) and drinking ouzo on the beach, while Germans scorn credit cards, accept less-than-productivity-level wages and arrive at 8.15am for 9am appointments.

“These peripheral (e.g. Greek, Spanish etc) economies went through a crash course in internal discipline before the euro came into being, accepting wage bargaining pacts, reduced deficits and debts. But the crash course came to an end when the EMU started,” explained Rhodes. Nonetheless, all countries accepted a “stability and growth pact” in order to reap the benefits of being “tethered” to the highly productive German economy via the EMU, whilst Germany accepted the EMU as a price for enlargement of Europe, which it believed would benefit its economy.

But this “pact” turned out to mean very little.

One of the impacts of the European Monetary Union, which I heard a very interesting story about on NPR the other day, was a “one size fits all” interest rate which was then applied across the Eurozone. Greek people who were used to tight credit conditions and high interest rates found overnight that they could borrow at relatively low rates – and borrow they did. Buying second homes, expanding businesses, getting new cars. All sorts. But this came without the economic conditions within their own country to support this type of behavior. In technical terms, their “business cycle became de-coupled” from that in Germany. They failed to contain massive ballooning public debts, or restrain wage rises, while in places like Ireland there were private market failures that saw huge asset bubbles develop – and a “massive wedge in competiveness” between “core” and “peripheral” European countries developed. Not good.

This is really what led us to where we are today in the Eurozone, with Greece technically bankrupt and unable to pay its debts, and other countries like Spain and Italy not looking too hot either, and other European countries like Germany and France trying desperately to keep the whole thing together lest the unimaginable happens – Eurozone crash!

Meanwhile, back in Greece...

Former Ambassador Kornblum said he believes the US is not paying enough attention to this situation. China is the talk of the day, but the Eurozone has even greater implications, he suggested. “This is much more fundamental to the US’ future,” he said, citing the fact that Germany is now the world’s third largest economy and trade with Europe accounts for 60 -70% of the US total.

As a former diplomat and current resident of Berlin with undoubtedly continued connections to the high level world of international diplomacy, the former Ambassador’s comments were particularly intriguing. He talked of how Europe and Germany itself is now going through “many levels of crisis”. The situation is as much to do with internal German politics and identity issues as it is with external economic concerns.

“The European leadership is caught between, on the one hand, these jazzy new financial markets and their own voters. You do have some leadership there, in Merkel, but she is really deeply frightened by her own voters. The problem is that the Euro was sold to them as a peace project. There would be no more war, there would be eternal Franco-German friendship. No one ever talked about an imbalance of payments. It was sold as an emotional, political project.”

“Merkel is doing all she can, but she’s caught between an electorate who were never told when they were adopting the Euro that they were adopting Europe and that if they did not the whole world would collapse.”

So what is the answer? “They do what they know how to do best: Have meetings and issue communiques” whilst probably believing that in reality their future is better suited to lie with the US, Singapores and Japans of the world, whose economies are more “up to speed” with Germany’s than those of the economic “klutzes” of Europe – Greece, Italy, Spain etc.

Merk-Hell.(Oh fine, just shoot me now... )

“Merkel is without now totally without a peer, a rival, in Germany now. She now has the entire responsibility of figuring out what Germany is going to be. But she doesn’t really know anything about financial markets. She is doing the things she knows – discipline and stability – which is wrong in my view. They should be talking about what’s good for the prosperity of all countries,” said Kornblum.

In fact, what may be most problematic is that the “next steps” Germany, France and the core European countries are looking at to address this crisis may very well be “unconstitutional in many European countries, and probably in Germany too,” said the former US official. (Think recent headlines about Greece descrying the “insulting” suggestion from Germany that it be able to place a “commissioner” in Greece to monitor how it spends public money within its own economy).

At the end of the day, however, Kornblum charged that the Euro will likely survive and Germany’s position will probably increase. But it will not be without pain. “They know they’re going to have to bail out many people but making it as painful as possible”, in a probably-futile attempt to appease their electorate, he said.

The same aggrandizement may not turn out to be the case for the Central and Eastern European economies, according to Prof. Rachel Epstein. As an expert in post-communist European societies, Prof. Epstein has some stark observations about the implications of the Eurozone economic crisis for these recently democratized countries.

The crux of the matter is that as they made their transition from communism to capitalism in the post-Cold War era, they were compelled in one way or another to sell large chunks of their financial systems to Western European banks – something Western European countries or the US would be loath to do themselves, given the implications for sovereignty over such a key sector of the economy.

“The European debt crisis imperils not only the Euro, but also the ongoing democratic project in Central and Eastern Europe,” said Prof. Epstein. “Only three of these countries use the Euro but they are terribly exposed, due to the relationship between economic hardship and democratic chaos.”

Not only do these same Western banks which now own much of these Central and Eastern European countries’ financial systems hold large amounts of “dodgy debt” issued by the like of the governments of Greece, but they are now being asked to write off huge losses to help save Europe, whilst simultaneously being hit by demands from governments in their home countries to shore up their capital bases (read: keep more cash at hand at home in case of losses) and to lend at home (rather than in these subsidiary areas).

“This all speaks to potentially very negative consequences for Central and Eastern Europe,” said Prof. Epstein. If these western banks begin to pull back on services and credit to customers in these countries, or even back out altogether, this kind of financial/economic doublewhammy could mean a major backstep for their democracies, which sit on relatively shallow institutional foundations given their newness in the post-communist era.

As one example of this type of threat, Prof. Epstein pointed to the rise of the right-wing “authoritarian and power aggrandizing” Fidesz party in Hungary, which, since 2010, has “Germans and Europe very worried.” The party has taken worrisome steps such as limiting the independence of the judiciary and imposing new levies on banks which could compound their incentives to withdraw.

Chairman of the right-wing Fidesz party after they sweep the parliamentary elections: Can you not raise your arm like that please?

On the other hand, Latvia is a country in this part of Europe which went through a terrible economic situation following the collapse of Lehman Brothers in 2008, losing 10 per cent of its population to other countries due to the downturn in social/economic opportunities, but yet retained its democratic character.

Whatever the case may turn out to be, Ambassador Kornblum’s warning that the US must pay more attention to Europe is no platitude.

(By the way, if this interests you, you should DEFINITELY listen to the episode of This American Life hosted by NPR’s Planet Money Team on “Continental Break-up” in the Eurozone that aired a couple of weeks back – great story telling about a complex subject: http://www.thisamericanlife.org/radio-archives/episode/455/continental-breakup).