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What a frustrating day. I got a lot of work done, but still feel… - Accretions

Fata Morgana
2003-08-30 22:42
(no subject)
Public
discontentdiscontent
What a frustrating day. I got a lot of work done, but still feel like I've wasted it.

I'm starting to get the hang of data analysis - having a sense of how to format data, what tests to run, what graphs to make to highlight any differences. Which is good, since I am in charge of analyzing and writing about the data from my summer project, and have to put together something cohesive and coherent by October 6, the paper deadline. I spent most of my day doing various research tasks, and will probably do a few more this evening.

My "ICT in Developing Regions" class looks like it'll focus on developing viable business models and research areas (such as fledgling ICT4B and other Citris projects) for "the other four billion" - the four billion people in the world who make less than the equivalent to $2000 in US purchasing power.

In contrast, so far my "Political and Economic Development in the Third World" class has been about how much the system now DOESN'T serve those same four billion, and why. On Thursday we watched a video about Jamaica and globalization called Life and Debt. It talked about the demands that the International Monetary Fund (IMF) makes when loaning countries money: short loan periods and high interest rates are just the start. Because the indicators for national health that the IMF uses are largely based on money spent on imports and money earned from exports, they require decreased imports and increased exports - and the way they ask countries to achieve this is to devalue their currency. If a country halves the value of their currency, suddenly imports cost twice as much and exports cost half as much. Coincidentally, exports are cheaper for the developed nations they usually serve. (Not surprisingly, the IMF is run by the big guns in global economics - a country's voting power is proportional to its economic "size.")

At the same time, the U.S. and other developed countries need to get rid of some things, such as all of the non-breast meat of chickens (there's a huge market in the U.S. for chicken breasts, but not much of a market for everything else) and milk surpluses. They export them to countries like Jamaica for dirt-cheap prices, which seems like a charity until you realize that all the local chicken farms and dairies are going out of business because of it. (Not only is the U.S. selling these other chicken parts at cheaper prices than the chicken breasts, but they can produce four times as many chickens in 1/3 of the time because of hormone and antibiotic use - so the local farmers just can't keep up.) Still, it's cheap food, right? But market forces say that the suppliers want to charge as much as they can get away with, and once all the local guys go out of business they can get away with a lot. The price of milk from the U.S. is currently stabilized by an international milk-charity law, but how long will that stay around if the milk lobby pushes for its removal?

[Aside: There was a scandal in Jamaica a few years ago involving 20-year old chicken meat sent to the Jamaican McDonald's chain. The meat was sent on to Haiti, and who knows what happened to it then. I'm not sure why the movie included this anecdote, except for the shock value.]

One other place where Jamaica has been hurting recently is bananas. The banana farms in Jamaica are still independently-owned because the government's taxes are too high for Chiquita's tastes. However, Chiquita can produce bananas for less, because they pay a pittance - so Jamaica's bananas aren't being sold.

Anyway, all of this means that to pay off the loans, countries generally have to put themselves back in the same situation that prompted them to seek loans in the first place. The IMF is inflexible when it comes to working with a country's government toward long-term goals - they say that's the government's problem.

The video also discussed the Kingston Free Zone, an untaxable area where lots of factories and sweatshops are located. It wasn't clear how and why the Kingston Free Zone was created - why would Jamaica allow so much industry to go untaxed? That could be a huge revenue source! Maybe they were bullied into it by companies threatening to move out and leave a swath of unemployment in their wake, but from the video it seems like lots of companies - aggressive for profits, and willing to move to wherever is cheapest to produce - are moving out anyway, often to Asia. Must learn more ...

Speaking of indicators, over the summer I read "This Place on Earth 2002", the Northwest's analysis of their own sustainability indicators, including all three E's (economics, environment, and equity). The book is free online.

I'd like to know more about how double- or triple-bottom lines work. I've only heard about them in conversations. From what I understand, most companies have a single, financial bottom line, and other effects that they have - say, on the environment, or the community around them - are just "externalities." Some companies, however, take more than money into account. I'd like to find out who and how.

Saturday night, and I'm working! I haven't heard from David in days ... not that I'd necessarily be doing anything different if he was here. We'd probably be in opposite corners of the same room, working on our respective projects. I tried to get him into yoga this semester, but the teacher was being unreasonably rigid (in my opinion) about her no-audits policy. Maybe I can sneak him in anyway; it's a 50-person class, and she doesn't seem really observant (I audited her class for 1/2 a semester last year without her noticing)....
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Ping
zestyping
2003-08-31 23:35 (UTC)
(no subject)
Sorry to hear you're feeling down. All the stuff about world economics sounds fascinating — i'd love to learn about it from you sometime.
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Fata Morgana
chimerically
2003-09-08 10:53 (UTC)
(no subject)
Sure! I'll hopefully be posting most of my notes and reflections from my classes here, unless I start running out of time (out of time? me? :~)). But I'm always up for a good discussion!
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