Gongol.com Archives: July 2017

Brian Gongol

July 12, 2017

Business and Finance How brain drain hits small countries

In this case, it's Finland. But similar circumstances apply not only to small nations, but to small states as well. As the global urbanization trend continues, so will the concentration of population in some of the world's largest urbanized areas -- and some of that will suck human capital out of lesser-urbanized places. Not everyone wants to live in London or Tokyo or New York City, but it will take a concerted effort by the Helsinkis (metro population: 1.3 million), Winnipegs (800,000), and Des Moineses (600,000) of the world to make sure they retain and develop their share of highly skilled civic, educational, and business leaders in the face of high returns to urban agglomeration economies.

Business and Finance Is a trade deficit a symptom of living beyond our means?

On the surface, yes. A net trade deficit with the rest of the world is often a symptom of a country that consumes more than it produces. But...there's also the question of capital flows. If a country has lots of valuable capital stock (factories, intellectual property, real estate, and so on), then it's possible to exchange things we have for things we want. It's not perfect -- it's like living off a trust fund -- but it's not necessarily living beyond our means. And, importantly, if we create new capital stock (for instance, by building expensive new real estate projects like the new second-tallest skyscraper in San Francisco), then it may be possible to buy things, send cash overseas, then get some of the cash reinvested back in the country. And depending on factors like property bubbles and the impact of agglomeration economies, it may be possible for foreign direct investment to come back to buy overpriced capital, reducing the relative cost of the net imports.

News "Does starting a band called ThugHammer count as a plan?"

The Onion spoofs the new requirement imposed on students in the Chicago Public Schools -- requiring them to have some kind of documented plan in order to graduate from high school. The plan goes into effect for the Class of 2020, and while it is completely understandable why something beyond a high-school diploma really is the de facto standard for a comfortable socio-economic future, that's a far cry from making it into a de jure standard. The advocates for a "Grade 14" policy (like former Education Secretary Arne Duncan) appear to be well-intentioned and get the problem generally right -- as the economy has grown more sophisticated, so have the expectations for people to be prepared for work -- but the prescription runs the very real risk of being, well, too prescriptivist. Creating true "lifelong learners" is a much bigger challenge than simply moving the goalposts for what it means to "finish school".

Computers and the Internet Microsoft to push for rural broadband access

They're proposing to conduct twelve experimental installations of broadband-over-TV-spectrum. Using the "white spaces" in the spectrum is supposed to be a cost-effective way of reaching people in places with population densities between 2 and 200 people per square mile. That basically describes all but about half a dozen counties in Iowa, though the state is not on Microsoft's list for the test runs. Nobody should choose not to recognize the economic, educational, and cultural impairment that is imposed today by a lack of access to high-speed Internet. We haven't chosen yet to give it the same kind of legal status as other near-universal utilities like electricity and water, but it's not far from being just as essential, at least in economic terms.

Threats and Hazards Why we should all worry more about North Korea

One scholar of arms control worries that we may already be down a path of no return towards open conflict with North Korea -- and no matter what we do to put up defenses here in the United States or abroad (as in South Korea), there may be targets that are vulnerable to attack in ways we cannot defend effectively -- and one of those is Seoul.

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