the __earthinc

Amid opposing positions, political centrists have the tendency to stake the middle ground. It is a compromise that appears sensible on the surface. Sometimes, it can be sensible deep down in a substantial way. It can even be the best path forward.

Not always though. Not all compromises are sensible and it can be even outright nonsense. A chronic centrist would do so anyway, and then has the gall to call those who see a square peg in a round hole as extremists.

There is no guarantee that centrism equates sensibility. Sensibility depends on an entirely different consideration altogether. It might very well be the seemingly extreme position that is the most sensible and right.

A chronic centrist does not believe that. He is a person who works like a mindless average machine. Take any two diametrical positions, average it out and there you go: a solution. Move on to the next issue, take any two positions, average it out and then there you go again: another solution. It goes on and on forever.

They rarely make introspection of the averaged positions. There is no thinking behind it, except some kind of blind elementary arithmetic applied onto issues in the public sphere. The only real argument they have to offer is that the middle path is a compromise. A win-win some would say. And a compromise is always a virtue, so say the centrists, who are also probably self-proclaimed political moderates.

Of course there are compromises that need to be made on a case-by-case basis. We live in a society where give and take has to happen and where we end up treading along the middle path. It indeed happens every day.

A musician practicing his trade living next to a neighbor who likes a quiet evening would have to talk to each other so that both can live comfortably without too much bad blood, for instance. On a bigger more concrete scale, the relevant landowners in Kuala Lumpur, the developer of the Mass Rapid Transit system and the government have to compromise to get the project going.

Or maybe in election seat negotiations among parties which have a common interest to defeat yet another party by combining resources instead of fighting each other, it is in their best interest to reach an amicable solution and refrain from engaging in wasteful squabbling.

By contrast, there are principles and ideas that cannot be violated. If a thief steals an apple from a person, one does not cut the apple to give half of the fruit to the thief and the other half to the owner. That is injustice. If a racist proposes a policy and a liberal advocates the opposite view, one does not just write a compromised policy that is half racist, half liberal. That is confusion. There is nothing sensible about such an unjust confused judgment.

It is a half-measure that the mindless and the gutless would take. The mechanical, automatic centrist is mindless because he does not make sense. He is gutless because he takes no real position. The centrist is an automaton. Feed in the input. Average it out. There you go: a moderated position.

We do not need automatons to solve our problems. We especially do not need mindless, gutless, automatic centrists to do the thinking for us. They tell us nothing of value. We need thinking beings, ones who reason from some position of principle, inducing and deducing through tough propositions to reach well thought-out conclusions. This is stuff that is likely beyond the mental capability of these automatic, mechanical centrists.

  

Since the Monetary Policy Committee will be meeting next week, it is only natural to talk about the Overnight Policy Rate. It currently stands at 3.00% and it is likely to stay like that after the MPC meet. I personally (and professionally!) am betting a cut only in March as I think while inflationary pressure is receding, it is still high. Maybe, there is a bias in that expectation. What can I say?

But what would a customized Taylor’s rule say?

This particular Taylor’s rule is imperfect as the “equilibria” are somewhat squishy and not quite as methodical as I would like it to be, but in the coming weeks I should be able to calculate better coefficients to produce better hypothetical rate to compare with the actual OPR.

But observing the preliminary customized Taylor’s rule of mine, the OPR does seem to lag behind the rule. When I met some officials and economists from the Malaysian central bank a month or two back, they cheekily said they would not reveal the “natural rates”. The next time I meet them, I plan to cheekily share with them my Taylor’s rule, and say “you don’t have to tell me because I can read your mind.”

What I find interesting is that during the last recession, the Taylor’s rule suggests that Malaysia would have been in some kind of liquidity trap if the OPR had followed the rule closely. More interestingly, since the monetary policy was tight during that time, it could have been loosened more, leaving little if any need for  the 2008/2009 fiscal stimulus. Yet another proof against the Najib administration’s fiscal stimulus (or non-stimulus as Mr. Hisham, I would imagine, would put it).

Fun-quotation-that-has-something-to-do-with-Australia:

…he had confessed to repeated intercourse with sheep on a recent visit to the family farm; perhaps that was how he had contracted the mysterious microbe.

This incident sounds bizarrely one-of-a-kind and of no possible broader significance. In fact, it illustrates an enormous subject of great importance: human diseases of animal origin. Very few of us love sheep in the carnal sense that this patient did. But most of us platonically love our pet animals such as our dogs and cats. As a society, we certainly appear to have an inordinate fondness for sheep and other livestock, to judge from the vast numbers of them that we keep. For example, at the time of a recent census, Australia’s 17,085,400 people thought so highly of sheep that they kept 161,600,000 of them.

Some of us adults, and even more of our children, pick up infectious diseases from our pets. Usually they remain no more than a nuisance, but a few have evolved into something far more serious… [Guns, Gems, and Steel. Chapter 11: Lethal Gift of Livestock. Page 196. Jared Diamond. 1999]

Happy Australia Day!

Transformation is a big word. It is not some word that should be used lightly. Use it too often for the smallest of things, it will turn into a cliché and it will lose its meaning soon afterwards. In Malaysia, that is already happening with all the stress on transforming Malaysia under the 1Malaysia banner.

And so, in conferring an award to Prime Minister Najib Razak, World Chinese Economic Forum’s Michael Yeoh said, “[y]ou have contributed significantly to the transformation of the Malaysian nation.”^[1]

Transformation of the Malaysian nation?

With the ETP appearing stalling or at more kindly put, going slowly, economic liberalization halted halfway through, along with half-baked realization of the September 15 announcement of the so-called political transformation program, and moreover, not even 3 years in office, I would think there is hardly anything that could be transformed. Tweak yes, but transform? Far from it.

Remember, transformation is a big word. It connotes an action that changed something completely into something else. Maybe the ETP has it right when it uses (and overuses) the word transform. At least, the objective of being (yet another overused phrase) high-income nation suggests a completely different Malaysian economic reality that prevails today.

A moth into a butterfly, that is transformation. Ass to a donkey? Maybe not so.

In the past three years, what transformation have we seen? Is Malaysia today any different that in 2009? Some potholes in the city have been there even before the PM assumed office with Abdullah Ahmad Badawi’s mandate. It will not take a transformation to cover the potholes. Yet, here we are living in transformation, so claimed Michael Yeoh.

You cheapen the word Mr. Yeoh. But I guess, since everybody uses it so cheaply, it does not hurt much. How more cheaply can the cliché get, eh?

A mere less-than-three-years, and Mr. Yeoh and the WCEF granted the PM a lifetime award.

If anything, the supposedly transformation has hardly begun in earnest. The jury is still out there but Mr. Yeoh and the WCEF have jumped the gun. Overwrought, them.

Najib was also conferred the “Distinguished Lifetime Achievement Award” by the WCEF for his work and commitment towards transforming Malaysia.

“You (Najib) have contributed significantly to the transformation of the Malaysian nation.

“The Chinese community has benefitted tremendously from you for your fair and just leadership,” WCEF chairman Datuk Michael Yeoh said in his speech at the conferment ceremony here today. [Chinese economic group calls Najib ‘Father of Transformation and Moderation’. Clara Chooi. The Malaysian Insider. January 25 2011]

Does anybody know why the leading indicator went up in October?

I see the money supply went up, which means demand for money went up, which in turn suggests there were increase in economic activities. But why?

Saturday football was always fun during college days. Every morning I would listen to the radio, watched television in the common room, visited a friend’s room to watch football (sometimes, I would take the bus all the way to North Compus or even sleepover the night before) or during my senior year, watched the game at the stadium in full school colors. Michigan was at the top of the world and it was easy for my friends and I to laugh at other god-awful teams. One of the teams was Penn State and Joe Paterno was the coach there, as he was for the longest time until recently. Paterno was Penn State.

The Littany Lions were doing so bad that fans were calling for his head. I remember this so clearly. On TV, a fan held up a poster, urging the Penn State to fire him. At that time, I stopped cracking jokes about Paterno, and starting to feel pity for him. For all he had done for Penn State, I felt it was unfair to ask so, so unceremoniously. He survived the tough time, unlike Michigan’s Rich Rodriguez, and went on to reinstate some respectability in the football program at Happy Valley.

For that and more, he deserved respect. This was the winningest coach in college football history. That fact alone demands respect.

It is obvious that not everybody agrees with that. Amid a sex abuse scandal involving his staff (not Paterno himself), Penn State fired Paterno. The administration fired him because the university thought he had not done enough.

Maybe there was an ethical error on his behalf. He should have reported it to the police, instead of informing what he knew of merely to his superiors.

Regardless, I thought it was unfair the way he was fired. Somehow, I thought he was the scapegoat.

It must have been hard on him. When you coach at the same place for 40 uninterrupted years, the place just stops being the place where you work. It will be your life. Imagine how Paterno felt when he was fired. Already suffering from cancer, the firing must have made it all worse.

Paterno died today. The knife that drove through his heart was not cancer. It could not have been. It must have been unfairness.

This is the Malaysian government spending year-on-year quarterly growth from 2001 till 2011, as classified in the real gross domestic product.

I am not saying anything bad about the French. I love the French. Close friends know how much I mean that. I am only quoting this just because the last sentence is witty.

Hermès, however, says that selling a sari in India is not taking coals to Newcastle. Rather, it wants to “connect with Indian tradition and elegance,” says Bertrand Michaud, president of Hermès India. And there is precedent, thanks to Hermès’ Marwari scarves (prints inspired by the rare horses of Jodhpur) and sari-dresses designed by Jean Paul Gaultier in spring 2008 when he was creative director of the brand. Those, however, were riffs; this is a more significant collection. “It is like Indians selling wine in France,” sniffs one Indian style expert. “To sell a sari in India takes Gallic gall.” [Saris from Paris? Financial Times. January 14 2012]

And no, I do not typically read the fashion section of the Financial Times or anything. I spotted a hot girl in sari on the front page (or somewhere) while reading about the debt negotiation in Greece. I then decided to skip Greece and turned to the fashion section instead. Sue me. I am a guy.

I am having a pang of longing for Michigan for reasons I do not know.

This song is named The Hymn, sang by the Men’s Glee Club at the University.

Ninety-three percent. The Malaysian literacy rate in 2009 was 93%, so says the United Nations Development Program in its latest Human Development Index report. But was it really?

I began to question the UNDP finding after reading a newspaper report that 8% of the National Service trainees are illiterate. It becomes worrying after one considers the context at which the eight percent is set in.

And the context is this. National Service trainees are chosen randomly from among 18-year-olds all across Malaysia. Assuming the 8% figure itself was derived through random means, it suggests that 8% of all 18-year-old Malaysians are illiterate.

One hopes that there was some significant non-random process at play. Maybe, the 8% came from a non-random sample. Maybe, these teenagers came from areas with notorious academic records and were overly represented in the sample. Although that would still be a problem, at least it would be a consolation. At least it would suggest the problem was not a systemic issue within the national system.

But if the process were random, then it would lead to the suspicion that the national literacy rate is lower than what has been reported.

This can be rationalized by understanding that the literacy rate tends to decrease as the age profile grows older for newly industrialized and industrializing countries. That includes Malaysia.

This is true simply because of secular trend. Access to primary education years ago was not as easy and widespread as it is today. That access has generally improved over the years. By implication, these 18-year-olds in general should have a higher literacy rate compared to their older counterparts.

If that is true, then it brings into question the Malaysian literacy rate itself. If the cohort study with arguably the best access to primary education has eight percent among them illiterate, one has to wonder about the credibility of the 93% literacy rate. With each older age profile having a similar or lower literacy rate, the national literacy rate might be lower than what has been estimated. At best, the standard used to measure literacy was too loose. Never mind the numeracy rate which is likely to be much worse than whatever the actual literacy rate is.

That in turn says a lot about the education system, notwithstanding its successes. It suggests that the education system is not as successful as it should be at imparting the most basic skills to schoolchildren: read, write and count. Not belief in god, not multiculturalism, not unity, not patriotism but read, write and count.

Other lofty and not-so-lofty agendas should take the backseat to these basic requirements. Without these basics, it will be really hard to acquire more complex higher-order skills and knowledge. Or they probably would not be able to use Google Translate at all, like somebody at the Ministry of Defense, apparently, can.

The biggest issue is that these 18-year-olds were allowed to graduate from school, if they actually even attended school. If they did attend school, then they must have had been pushed through the system regardless of their capability.

The way these students were pushed through the system is deplorable.

What instead should happen is that a student’s competency should be assessed each year. If the assessment is unsatisfactory, then students with normal learning capability should repeat the year until they are competent enough to go to the next level.

Of course, there should be a limit to how many times they can repeat but with almost everybody experiencing at least 11 years of schooling, surely there are enough years for the repeat to occur until these students can read. Any system that cannot ratify the problem within 11 years is a system unworthy of us.