Kurt Vonnegut’s Harrison Bergeron is a critique of overstated equality. As members of civil society we all agree upon the value of equal rights and equal opportunities. But when equality is taken too seriously, it can have counterproductive effects. All of us have experienced inequality of power, fortune and endowments in our personal and social lives. We accept it to be part of the game of life and adapt ourselves to the fact. In contrast, the political realm endeavors to offer equality of individual rights, liberties and entitlements. The eligibility to vote to elect our public representatives is one such right. The right of electoral franchise is equal to the extent that one person is allowed one vote and that each vote is weighted equally. It is telling that this fundamental observation of equality still does not make the United States an ideal model of democracy. Hence, there is disconnection between lofty principles and ground realities in both the short-story as well as . . . Read More
Category: Economics
Select Summary of Berkshire Hathaway Annual Reports
Berkshire Hathaway uses debt quite sparingly. Even when it does borrow, the company tries to structure its loans on a long-term fixed-rate basis. Adopting a conservative approach, the company will rather reject interesting opportunities than over-leverage its balance sheet. While this policy may have moderated the profits over the years it is the most prudent option. This is so because, the company cannot afford to forsake its fiduciary obligations to stakeholders who are heavily invested in it. (2012, p.98)
Compared to most other investment firms, Berkshire has access to two sources of low-cost, non-perilous leverage options – deferred taxes and ‘float’. These allow the company ownership of far more assets than its total equity capital would permit. As of 2012 these funding sources have grown to an impressive $117 billion. (2012, p.98)
Berkshire has long invested in derivatives contracts which are found to be mispriced, just as the company invests in mispriced . . . Read More
Differences between Bretton Woods world trade regime and the current world trade system governed by the World Trade Organization
The Bretton Woods system was the result of a grand financial conference at the culmination of the Second World War. The participants were delegates drawn from 44 Allied countries that were in coalition against the defeated Axis powers. The main purpose of the conference was to organize and regulate the international monetary and financial systems, which were thrown into disarray during the war. The chief outcome of the event was the signing of GATT (General Agreement on Tariffs and Trade. The conference laid the foundation for the later emergence of World Bank and the International Monetary Fund. The priorities and economic models adopted by the WTO are a marked contrast to that of the Bretton Woods regime. The mantra of WTO since 1972 has been international trade liberalization. The Marrakech Agreement of 1995 officially replaced the other GATT regime. Although free trade is paid lip service, the arrangements are more favorable to countries and business corporations with bigger . . . Read More
According to Rodrik, why is national democracy incompatible with deep globalization?
There are several contradictions between the concepts of democracy and unfettered globalization. Professor Dani Rodrik’s work on the subject is about elucidating these contradictions which is at the centre of many political debates today. One of main reasons why deep globalization is antagonistic to national democracy is the undue power wielded by international capital. For most part what appear to be foreign investments into a local economy is actually fluid speculative capital. If the investment firm perceives the return on their investment to be unimpressive then it would not hesitate to pull out capital from the financial markets. This would lead to a fall in share prices and huge nominal losses to the other stakeholders – local partners, local firms and the national government. So the power of international capital gives its wielders the power to dictate terms to local governments, which in turn undermines democracy and nation-oriented policy making. There are numerous . . . Read More
How coherent was the National government’s response to mass unemployment after 1931 in Britain?
The interwar years were some of the most turbulent in the history of Britain. Given the strong trade and diplomatic links between Britain and the rest of Europe and North America, the former’s economic stability depended on several external factors. The Great Depression that struck the United States in 1929 had repercussions across Europe. The mass unemployment witnessed in Britain during this period is not merely a coincidence. On the political front the rise of the Nazi Party in Germany gave rise to distrust and apprehensions of war. In this respect, the social history of interwar Britain is one highly influenced by unravelling economic and geo-political conditions. To go with widespread unemployment there were also conflicts across class lines. The General Strike and the hunger marches that were witnessed during this period were expressions of public frustration. Although the national government was outwardly sympathetic to public angst, and on occasion participated . . . Read More
Sewing for Millionaires: Rawlings’ operations in Costa Rica
- In your opinion, is Rawlings exploiting its Costa Rican employees? Explain your answer.
In my opinion, I don’t think Rawlings’ operations in Costa Rica are exploitative. The very nature of capitalist enterprise is such that cost efficiency is a major driver of business. To criticize Rawlings for doing what it is legally mandated to do (namely, to seek profits for is shareholders) is quite unfair. Moreover, critics are not appreciating how Rawlings has created jobs in the Costa Rican economy. Companies such as Rawlings have helped consolidate Costa Rican economy. It is in recognition of this fact that the Costa Rican government has offered special economic zone status to Rawlings and other MNC manufacturing units.
Even when one looks at wages and employee benefits, Rawlings has done nothing illegal. The company has adhered to minimum wage standards of Costa Rica. Further it complies by paid-leave and medical insurance . . . Read More
Should the USA lower, raise, or maintain its corporate tax rates?
Taxes are always a contentious issue in American politics. The two leading parties in the country have their own views on taxes. The Republicans are mostly in favor of tax cuts for businesses, whereas the Democrats generally favor proportionately high taxes for the rich. In my personal opinion I support a progressive tax regime that levies a greater tax rate on corporations and rich individuals. The rationale for this position is the prevailing disparities in American society. Despite being the richest country in the world, the United States lags behind in welfare and social security features.
The revenues collected through a progressive tax regime can be utilized to strengthen the public healthcare system. As it stands, the United States has more than 50 million citizens without health insurance. This is a shocking statistic, for with only a fraction of the yearly military budget, health access and healthcare outcomes in the country could be improved multifold. . . . Read More
Article Review – A Universal Healthcare System: Is It Right for the United States? By Marleise Rashford
Abstract
The prevailing healthcare system in the United States has drawn many criticisms – from healthcare professionals and citizens alike. The American system fares badly compared to nationalized public health systems of Western Europe. Even in terms of overall costs, the American model is more expensive, which is significantly inflated by bureaucracy costs. All comparative evidence points in one direction – that the country would benefit through an overhaul of the healthcare system. Single payer and universal insurance coverage are the cornerstones of the optimal system. Posing hurdles for this noble objective are vested private interests in the form of private insurance companies, ideologically entrenched politicians and to a lesser extent, healthcare providers.
Why is the article relevant to our course discussions on the U.S. Healthcare system?
The issue of healthcare is a pressing social problem in the United States. . . . Read More
‘Two Cheers for Materialism’ by James Twitchell & ‘Profiles in Splurging’ by Randall Patterson : A combined overview
In “Two Cheers for Materialism,” James Twitchell posits that “We live through things, we create ourselves through things and we change ourselves by changing our things.” When we look at this claim by the author, it sounds like a veiled criticism of a materialist culture. But through numerous apt examples and nuanced explanations, Twitchell comes around to acknowledge the power of consumerist impulses and seeks to explain what drives them. He also argues that capitalist consumerism is not something that is imposed on people as academic critics often claim. Instead, the continued thriving of consumerism is due to our own innate needs, desires and aspirations. The article by Randall Patterson titled ‘Profiles in Splurging’ complements Twitchell’s core thesis. This essay will qualify the aforementioned working thesis by considering all the facts and arguments presented in these two articles.
To a great extent, the claim in the working thesis can be viewed as a . . . Read More
What are the many cultural, political & geo-economic challenges faced by organisations operating in a global environment. How could they be addressed?
The major cultural challenges facing a global enterprise is understanding and adapting to local business customs and norms. In the Real World Case we saw how business in Africa tends to go on at a leisurely pace – a practice that undermines the principles of efficiency and expediency that multi-national enterprises thrive on. Understanding cultural sensibilities and adapting to them requires an open-mind and a flexible management approach. This can prove quite challenging if the top management is too engrained in their B-school trained approach. Often government bureaucracy or red tape can hinder expedient project execution. Red-tape can thus be considered both a cultural and political issue. Another political issue is the state of development. As emerging economies are mostly from the Third World, the available infrastructure can be quite rudimentary. This is a geo-economic challenge, for a majority of the population might be IT illiterate, as reflected in minimal usage of . . . Read More