外报阅读(2012-1)

Passage 1
A fare fight
Taxi markets are a perfect test of Europe’s willingness to change. The first in an occasional series on structural reform
Feb 11th 2012 | from the print edition
MANY a journey starts in a taxi. So it is with the road to deregulation in the euro zone’s economies. Mario Monti, Italy’s prime minister, has prioritised liberalisation of taxi licences; Italy’s cabbies are striking as a result. Greek taxi-drivers have blockaded streets several times in protest against deregulation. Why have taxis becom e emblematic of the battle to free hidebound economies?
The superficial answer is that taxis are iconic: think of the badges, the bold colours and the recognisable models. The complex answer is that these features are
them selves the result of regulation, and not just in the euro zone. From the turning-circle of a London taxi to the m edallions on the hood of a New York cab, this industry picks up rules as easily as fares.
Taxi m arkets should be simple. Costs of entry are low. There are rarely large incumbent firms. On paper, com petition should flourish. But low barriers to entry create a risk of having too m any taxis on the roads. The number of taxi drivers in New York and Washington, DC, shot up between 1930 and 1932, as the unem ployed sought work during the Depression. Such surges lead to rules to reduce congestion. Am erica started to set up new regulatory authorities in the early 1930s; Britain established binding numerical limits on horse-drawn coaches way back in 1635.
Cab fares can be problematic, too. Unregulated com petition means that fares fall to little m ore than a driver’s expenses. These expenses are influenced by distance (fuel costs), duration (the cost of tim e) and destination. The end-point for a trip is vital: som e destinations (airports, say) will pretty m uch guarantee a return fare; others will not. This m eans journeys of a similar distance can have very different costs, so working out a fair price is tricky. In an unregulated m arket passengers would have to search out a com petitive price, a tim e-consuming process of hailing or calling a number of cabs. That allows taxi operators to run an opaque pricing structure.
The response to this problem in many jurisdictions has been regulation to establish a uniform price, giving custom ers c ertainty over what they will pay. But as a result journeys that are the sam e distance end up varying hugely in value for drivers. Short trips around tourist destinations are lucrative; trips to more remote areas, or on congested commuter routes, are much less profitable. Since full-tim e cabbies cannot raise prices, they m ay refuse to operate at less popular tim es or to carry passengers who live at the wrong end of town.
The answer has been to layer on yet m ore regulation aimed at enforcing uniform pricing, geographic coverage and quality standards. Rome and Mumbai operate hard geographic barriers to entry: those who live outside the cities cannot operate inside them. A better idea is imposing an entry cost for a perm it that a driver loses if found to be violating the rules. This creates a commit ment to the industry and an incentive to play fair. The New York m edallion system works this way: a driver caught violating rules is banned and the m edallion suspended, so both the driver and m edallion-owner lose out.
But even well-thought-out regulations end up not working. Drivers of London’s black cabs must learn the city’s streets by heart but these tests can now take four years to com plete (in 1960 it took up to a year), which acts as a bottleneck to new supply. That a New York m edallion sells for over $1m suggests well-intended commit ment devices can simply becom e a barrier to entry.
Incumbent drivers argue that m ore taxis might help travellers but would dent profits, putting low-value trips at threat and reducing cab quality. But the idea that markets are a zero-sum game is a bad one. Loosening quantity restrictions might benefit both drivers and passengers. More cabs m ean lower waiting times and can increase the num ber of travellers who choose to use taxis. The m a rket grows. This could boost utilisation rates and profits.
There is supporting evidence. In 1998 Dublin suffered from a distorted licensing system. Demand had doubled in the previous 20 years but the num ber of licences had not kept up. Waiting tim es were over an hour. Deregulation in 2000 reduced entry costs (the cost of a car and a licence) by 74%. The result was more than three tim es as m any cabs on the roads, lower waiting times, m aintained cab quality and higher passenger satisfaction—all in two years.
In Tehran taxi supply is flexible, rising and falling with demand. A shared-taxi system operates, allowing any private car to pick up passengers. Because travellers can hop on and hop off as they please, a driver can carry passengers travelling to different destinations at the sam e time. This boosts utilisation, just as a bus route does. The system also m eans the quantity of taxis is truly fluid, rising during rush hour as commuters pick up a few passengers on their way home. It would be hard to design regulation that worked this well.
The Swedish experience suggests one downside to deregulation. Following the country’s banking crisis in 1990 lots of industries were deregulated. For taxis price controls, restricted operating tim es and regulated zones were a ll swept away. The year after deregulation the number of taxis per inhabitant had risen by 28%. But fares to rural areas (low-value one-way trips) rose, in line with theory. One solution would be to subsidise taxi fares to som e rural areas where buses do not operate.
The regulatory straitjacket that characterises the taxi industry m ay have been fitted for valid reasons. But barriers to entry m ake markets sm aller. Dismantling layers of regulation to increase m arket size and efficiency is the rationale behind
structural-reform efforts in the euro zone. If these economies are to change, the taxi is as good a way as any to start the trip.
Passage 2:
The euro zone crisis
Political commitment
Feb 10th 2012, 13:23 by Buttonwood | DALLAS
THE running conflict between creditors and democracies reached a new stage with the battle over Greek debt. The EU is dem anding that Greek leaders add €325m of cuts, pass the rules through Parliam ent and that all three m ain party leaders commit to the deal so that they cannot renege after the next election. This m ight not be sufficient. As David Zervos of Jefferies points out, Pasok (the form er gove rning party) is on 8% in the polls. Three parties well to the left of Pasok have m ore than 42% support; New Democracy, the centre right party has 31%.Mr Zervos writes that
So what do Papademos' letters of intent, endorsed by the 3 party leaders, really mean? Absolutely nothing! Of course the EU leaders are not stupid, and they understand that after April elections the Greeks will very likely not stand up to any agreement. And they want to protect their €100b check. That is why they have proposed an "escrow" account for bailout monies (maybe they should have called it a UTMA account). It is also why they are asking for the party leaders to bind themselves, via written commitments, to adhere to the agreement after April. Last year Samaras balked at such a letter, and the deal still went through. This time who knows. And in the end who cares. An election tomorrow or in April could easily produce a New Left/KKE/SYRIZA coalition government. You think KKE will sign something for the Germans?? Ha!!! There would be no letters, no commitments - just a bunch of left wing anti-establishment types thumbing their noses at the north.
There is, surely, a fundam ental difference between lending m oney to a household, a company and a governm ent - and a difference that m akes the characterisation of the latter as risk-free as rather odd. Heads of families cannot tell creditors that "Sorry, we've had a vote. I would pay you back but was outvoted by the wife and kids." In the m iddle ages, lending to m onarchs was the ruin of m any bankers; the French even executed som e creditors. A debor who can change the laws is a risky beast.
We can argue that voters have the right to renounce debts taken out in their name. But they also have to accept that it is hard to com pel creditors to lend to them (foreign creditors, at any rate).
Meanwhile, the fall in French industrial production illust rates the m ountain facing Nicolas Sarkozy as he campaigns for re-election. If he falls, he will add to a long list of countries that have changed administration since the debt crisis started - the US,
UK, Spain, Portugal, Greece, Italy, Denmark, Romania, etc. The big exception is Angela Merkel but she heads a creditor nation.
Passage 3:
Income inequality
Who exactly are the 1%?
The very rich in America increasingly work in finance, marry each other and care passionately about politics
Jan 21st 2012 | from the print edition
MITT ROMNEY is not the first m ulti-millionaire to seek the presidency, nor the richest. Ross Perot, the record-holder, spent som e of his billions earned from com puter data on losing bids in 1992 and 1996. Since then m en who owe their or t heir family’s fortunes to oil, sport, publishing, trial law, ketchup, beer and bestselling autobiographies have followed.
But Mr Romney, who earned his $200m or so as a private-equity executive buying and selling com panies, is the first candidate from the world of high-octane finance. As such, he illustrates the changing com plexion of Am erica’s rich. The wealthiest 1% of Am ericans not only get m ore of the pie (see chart); they are increasingly creatures of finance.
The average household incom e of the 1% was $1.2m in 2008, according to federal tax data. The ultra-rich skew that average upwards: admission to the 1% began at $380,000 in 2008. The Congressional Budget Office puts the cut-off lower, at $347,000 in 2007, or $252,000 after subtracting federal taxes and adding back transfers. Measured by net worth, rather than incom e, the top 1% started at $6.9m in 2009, according to the Federal Reserve, down 23% from 2007.
The richest 1% earn roughly half their incom e from wages and salaries, a quarter from self-employment and business incom e, and the remainder from interest, dividends, capital gains and rent. According to an analysis of tax returns by Jon Bakija of Williams College and two others, 16% of the top 1% were in m edical professions and 8% were lawyers: shares that have changed little between 1979 and 2005, the latest year the authors examined (see chart). The m ost striking shift has been the growth of financial occupations, from just under 8% of the wealthy in 1979 to 13.9% in 2005. Their representation within the top 0.1% is even m ore pronounced: 18%, up from 11% in 1979.
Steve Kaplan of the University of Chicago thinks finance explains much of the rise in inequality. Updating a series developed by Thomas Piketty and Emmanuel Saez, Mr Kaplan notes that the share of incom e going to the 1% reached an 80-year high of 23.5% in 2007, only to sink to 17.6% in 2009 as the financial markets deflated (see chart). The trend is even m ore pronounced for the top 0.1%, whose share of total incom e rose to 12.3% in 2007 but sank to a still disproportionate 8.1% in 2009.
Mr Kaplan and Joshua Rauh of Northwestern University note that investm ent bankers, corporate lawyers, hedge-fund and private-equity m anagers have displaced corporate executives at the top of the incom e lad der. In 2009 the richest 25 hedge-fund investors earned more than $25 billion, roughly six times as m uch as all the chief executives of com panies in the S&P 500 stock index com bined.
Although the 1% have been gaining share in most countries, a recent OECD report shows that the trend began sooner, and has gone further, in Am erica. Som e scholars, noting that inequality has risen more in English-speaking countries, think social and political values may play a role: in mainland Europe and Japan, corporate governance, tax laws and unionisation have tended to lessen incom e disparities. But the relatively large role of the financial sector in English-speaking countries could also be a factor: even m ore of the top 1% work in finance in Britain than in America.
Mem be rship in America’s 1% is relatively stable; three-quarters of the households in the percentile one year will still be there the next. Although the proportion shrinks over tim e, one study found that the vast m ajority of the top 1% were still in the richest 10% a decade later. Kinship plays a big part: rich parents tend to produce rich kids. High levels of educational attainm ent and stable families help in this. According to Gallup, 72% of the 1% have a college degree, and half have a postgraduate degree; those are two to three tim es the proportion of the other 99%. The 1% are m ore likely to be m arried and to have children.
The rich also increasingly marry people like themselves. Mr Bakija and his co-authors found that between 1979 and 2005, the share of spouses of the 1% who had blue-collar or “miscellaneous” service-sector backgrounds declined slightly, from 7.9% to 6.4%. The share of spouses who worked in finance, property and law rose from 3.5% to 8.8%.
Politically, Gallup polls find that the 1% are more likely than the 99% to identify
them selves as Republicans (33% to 28%) and less likely to be Democrats (26% to 33%). A survey of 104 wealthy families in the Chicago area, led by Benjamin Page of Northwestern University, found the budget defici t was their leading worry, followed by unemployment; for the broader population, the reverse is true. Still the rich, like m ost voters, have eclectic views, often supporting liberal and conservative positions simultaneously. For example, Keith Whitaker, who advises wealt hy families on behalf of Wells Fargo, says m any of them sym pathise with the Occupy Wall Street movement. A lot of them becam e rich by building businesses and consider Wall Street “the place where businesses are taken apart and run by someone else”.
Bob Perkowitz embodies these contradictions. A rich entrepreneur, he now devotes much of his tim e to a non-profit environmental outfit. He is a lifelong Republican who objects to George Bush junior’s tax cuts for the wealthy, and backed Barack Obama in 2008. Having restructured com panies himself, he has no trouble with Mr Romney’s private-equity work but agrees with Occupy Wall Street that corporations have too m uch power.
Until recently he split his tim e between conservative Charlotte, North Carolina, and liberal Washington, DC. His wife, Lisa Renstrom, used to m anage hotels inherited from her father, a prosperous Republican businessman. Now she cam paigns on clim ate change and backs Wealth for the Common Good, a group of rich people who back Occupy Wall Street. He r father used to give his occupation as “capitalist”. “I grew up believing that [capitalists] were m aking the world a better place,” she says. “The capitalism we have has left us with degraded infrastructure, threats to our health, and global warming.”
Most of the 1% prefer not to talk about their good fortune. As the New York Times recently observed in an article on the 1%, “Some envisioned waking up to protesters on the lawn; others feared audits by the IRS or other punitive government action.”
But Mr Perkowitz and Ms Renstrom are utterly typical of the 1% in that they are far more politically engaged than the average 99-percenters. Nearly all the rich people surveyed by Northwestern vote, 68% make campaign contributions, nearly half had contacted a m ember of Congress and a fifth had solicited contributions on behalf of a candidate. A good chunk of those calls were m eant to help their businesses. But many were motivated by the common good, defined in as many different ways as the sources of their wealth.
Passage 4：
Natural disasters
Counting the cost of calamities
Death rates from natural disasters are falling; and fears that they have become more common are misplaced. But their economic cost is rising relentlessly
Jan 14th 2012 | ROTTERDAM, NETHER LANDS AND WASHINGTON, DC | from the print edition
THE world’s industrial supply chains were only just recovering from Japan’s earthquake and tsunami in March when a natural disaster severed them again in October. An unusually heavy m onsoon season swelled rivers and overwhelmed reservoirs in northern Thailand. The floodwaters eventually reached Bangkok, causing a political crisis as residents fought over whose neighbourhoods would flood. But before that the econom ic toll was being felt farther north in Ayutthaya province, a m anufacturing hub. The waters overwhelm ed the six-m etre-high dykes around the Rojana industrial estate, one of several such parks that host local- and foreign-owned factories.
Honda’s workers rescued newly built cars by driving them to nearby b ridges and hills. The factory ended up under two m etres of water and is still closed. Honda was hardly alone: the industrial estates that radiate out from Bangkok are home to m any links in the world’s autom otive and technology supply chains. Western Digita l, a maker of com puter disk drives which has 60% of its production in Thailand, had two of its factories closed by the floods, sending the global price of drives soaring.
Thailand is no stranger to floods. Europeans once called Bangkok the “Venice of Asia”. But rarely have they done so m uch econom ic dam age. October’s deluge cost $40 billion, the m ost expensive disaster in the country’s history. J.P. Morgan estim ates that it set back global industrial production by 2.5%.
Such m ulti-billion-dollar natural disasters are becom ing common. Five of the ten costliest, in term s of m oney rather than lives, were in the past four years (see m ap). Munich Re, a reinsurer, reckons their economic costs were $378 billion last year, breaking the previous record of $262 billion in 2005 (in constant 2011 dollars). Besides the Japanese and Thai calamities, New Zealand suffered an earthquake, Australia and China floods, and America a cocktail of hurricanes, tornadoes, wildfires and floods. Barack Obama issued a record 99 “major disaster declarations” in 2011.
Acts of God, or man?
Although deadly quakes are rarely blamed on human activity, it is fashionable to blame weather-related disasters on global warming. It does seem plausible: warm air worsens droughts and lets tropical air hold more moisture, the fuel for cyclones (weather form ations that include hurricanes and typhoons). However, a recent study by the Intergovernmental Panel on Climate Change, which represents the consensus am ong thousands of scientists, expressed little c onfidence in any link between climate change and the frequency of tropical cyclones.
The world has succeeded in m aking natural disasters less deadly, through better early-warning system s for tsunamis, better public information about evacuation plans, tougher building codes in quake-prone areas and encouragement for hom eowners to adopt simple precautions such as installing tornado-proof rooms in their homes. Annual death tolls are heavily influenced by outliers, such as Haiti’s earthquake in 2010 (which killed m ore than 200,000) or the Bangladeshi cyclones in 1970 (300,000). But, adjusted for the Earth’s growing population, the trend in death rates is clearly downward.
However, even if natural disasters may be no more common and no more likely to kill people than before, there is no doubt that their economic cost is rising. This is because a growing share of the world’s population and economic activity is being concentrated in disaster-prone places: on tropical coasts and river deltas, near forests and along earthquake fault lines.
Thailand is an example of this. Since its last serious floods, in 1983 and 1995, the country’s export-oriented industrial base has grown rapidly in the provinces around Bangkok and farther north along the Chao Phraya River. Ammar Sia mwalla, a Thai econom ist, notes that the central plain where many industrial estates now sit was once heavily cultivated for rice precisely because it floods regularly. Although dykes
(called levees in Am erica) protect these estates and central Bangkok, they m ay raise water levels, and thus the risk of flooding, elsewhere.
Wildfires, which destroyed thousands of hom es in Texas in 2011 and in Australia in 2009, were more destructive than hitherto because, as populations have grown, new housing has been built in wooded areas. Throughout Am erica’s west and south-west, encroaching suburbia has put pressure on forest m anagers to suppress fires as quickly as possible. Yet repeated fire suppression allows forests to accumulate m ore fuel which can lead to m ore intense and devastating fires later on.
Australia’s “Black Saturday” bushfires (pictured above), which killed 173 people and destroyed 2,298 homes in 2009, were said to be the country’s worst natural disaster. But a study by Ryan Crompton of Macquarie Universit y and others found that 25% of the destroyed buildings were in bushland and 60% were within ten m etres of it, and thus exposed to the threat of fire. The study concluded that if previous fires had occurred with people living so close to the bush as today, a 1939 outbreak of wildfires would have been the deadliest while Black Saturday’s would rank second, and only fourth by number of buildings destroyed.
In harm’s way
Am erica’s coasts m ay be a microcosm of where the world is headed. Florida’s population has grown from2.8m in 1950 to 19m now. Howard Kunreuther and Erwann Michel-Kerjan, disaster experts at the Wharton business school in Pennsylvania, reckon there are now nearly $10 trillion of insured and hurricane-prone assets along the coast from Maine round the Florida peninsula to Texas. Roger Pielke of the University of Colorado at Boulder reckons that the Great Miami Hurricane of 1926, which cost $1 billion in 2011 dollars, would cause $188 billion of damage now.
Whether the economic toll of disasters is rising faster than global GDP is unclear, since a wealthier world naturally has m ore wealth at risk. Still, the incidence of spectacular, multi-billion-dollar catastrophes seem s certain to rise. A 2007 study led by the OECD reckoned that by 2070, seven of the ten greatest urban concentrations of econom ic assets (buildings, infrastructure and the like) that are exposed to coastal flooding will be in the developing world; none was in 2005. In that tim e, assets exposed to such flooding will rise from 5% of world GDP to 9%. A World Bank study led by Apurva Sanghi estimated that between 2000 and 2050 the city populations exposed to tropical cyclones or earthquakes will more than double, rising from 11% to 16% of the world’s population.
Development by its nature a lso aggravates risks. As cities encroach on coasts, wetlands and rivers, natural barriers such as m angrove swamps and sand dunes are obliterated and artificial ones—dykes and sea walls—are erected to keep the water out. The result is to put m ore people and property in harm’s way if those barriers fail. After the second world war Japan embarked on a vigorous programme of building seawalls and dykes to protect its ci ties against storm surges and tsunamis. That in
turn encouraged cities’ growth and industriali sation, but for the sam e reason exposed them to damage if a tsunami overwhelmed their defences, as it did in March.
As cities on river deltas extract groundwater for industry, drinking and sanitation, the ground subsides, putting it further below sea level and thus requiring even higher dykes. Since 1980 Jakarta’s population has more than doubled, to 24m, and should reach 35m by 2020. Land that once absorbed overflow from the city’s 13 rivers has been developed, and is now subsiding; 40% of the city is now below sea level.
Perverse incentives
People originally settled in river deltas precisely because regular flooding made the land so fertile. Those cities have continued to grow because of the natural economic advantages such concentrations of hum an talent hold for modernising societies. Even when poor people m oving to cities know they are increasing their risk of dying in a mudslide or flood, that is m ore than com pensated for by the better-paying work available in cities. And in rich countries, coasts are gaining population simply because people like living near water.
Perverse incentives are also at work. In Am erica, hom eowners on floodplains must have flood insurance to get a federally backed mortgage. But federal insurance is often subsidised and m any people are either exempt from the rule or live in places where flood risks have not been properly mapped. Some do not buy disaster insurance, assum ing they can count on federal aid if their home is destroyed. Once the governm ent declares a disaster, it pays 75-100% of the response costs. Presidents have found it increasingly hard to turn down pleas from local leaders for assistance, especially in election years. Matt Mayer of the Heritage Foundation, a conservative think-tank, says the government routinely takes charge of local disasters that should be well within a state’s capability. The result is that state disaster-m anagement atrophies and disaster funding ends up subsidising disaster-prone places like Florida at the expense of safer states like Ohio.
As a consequence of these skewed incentives, people routinely rebuild in areas that have already been devastated. Bob Meyer of the Wharton School gives the example of Pass Christian, a resort town in Mississippi, where an apart m ent com plex was destroyed by Hurricane Camille in 1969, killing 21 people who had taken refuge inside. A shopping centre and condominium s were later built in the sam e area, only to be wiped out by Hurricane Katrina in 2005, since when m ore new condominiums have gone up nearby.
This is not all because of incentives. As Mr Meyer says, people have a tendency not to price rare, unpredictable events into their decisions, even if these m ay have catastrophic consequences. Leo “Chipper” McDermott, the m ayor of Pass Christian, notes that m ore than t hree decades elapsed between Camille and Katrina. “Life is a chance. And let m e tell you som ething else: water sells.”
If human nature cannot be changed, government policy can be. That might mean spending more on preventing disaster so as to cut its costs. Roughly 20% of humanitarian aid is now spent responding to disasters, whereas a paltry (but rising) 0.7% is spent on preventive measures taken to m itigate their possible consequences, according to the World Bank.
A Dutch rethink
The Netherlands, whose existence has long been at the m ercy of nature, m ay be at the forefront of rethinking how to cope with it. Som e 60% of the country is either under sea level or at risk of regular flooding from the North Sea or the Rhine, Meuse and Schelt rivers and their tributaries. In 1953, a com bination of a high spring tide and severe storm over the North Sea overwhelmed dykes, flooding 9% of its farmland and killing 1,800 people. The country responded with a decades-long programme of “delta works” to guard estuaries from storm surges, while raising and strengthening dykes.
The success of those defences has, perversely, m ade the consequences of failure even greater, says Piet Dircke of Arcadis, a Dutch engineering firm specialising in water m anagement. Protected by the delt a works and dykes, the land stretching from Amsterdam to Rotterdam has heavily industrialised and now provides m ost of the country’s output. “The northern and southern parts of the Netherlands are far more safe but are economically less attractive. People are m oving to the western part of Holland because it’s where the econom y grows.”
In 1993 and again in 1995 heavy river flooding inundated the countryside and nearly rose above dykes in population centres, forcing the evacuation of m ore than 250,000 people. Katrina was the final wake-up call, m aking the Dutch face up to both the unreliability of forecasts of once-in-a-century events and the im possibility of their repeating the Am erican feat of evacuating a million people.
The country’s philosophy of flood co ntrol has as a result pivoted from building ever higher dykes to instead m aking its cities and countryside m ore resilient to floodwaters. In 2007 it launched its €2.3 billion “Room for the River” project. At 39 locations along the Meuse, Rhine, IJssel and Waal rivers, dykes are being moved inland, riverbeds deepened and fields now occupied by farms and households deliberately exposed to floods. The Dutch invented the word “polder” centuries ago to describe dry land created by enclosing floodplains (or shallow waters) with dykes. They are now “depolderising”, removing or lowering the surrounding dykes and turning land back into floodplains. The Rhine’s maximu m flow without causing disaster will be raised from 15,000 cubic m etres a second to 16,000 and, eventually, 18,000.
The Noordwaard polder south-east of Rotterdam was floodplain until 1973, when the delta works m ade it suitable for cattle and vegetables. It is now being turned back into floodplain to absorb floodwaters that m ight otherwise inundate cities upstream. To do so, the governm ent had to persuade 18 farmers to m ove or have。