Tuesday, September 30, 2014

EFN 41: Program of Conference 2014, Hong Kong

Friends and readers, may I invite you to attend the Economic Freedom Network (EFN) Asia Conference 2014 this coming 6-7 November 2014, at the Harbour Grand Hong Kong Hotel, Hong Kong. The theme of the conference will be “Liberalism: Promoting Growth, Reducing Inequality”. The event is jointly sponsored by the Lion Rock Institute (LRI), EFN Asia, and the Friedrich Naumann Foundation for Freedom (FNF).

Here is the Conference Programme as of this week. There could be minor changes in the list of speakers and facilitators in the coming weeks as people confirm or change their participation. I got this program from the Program Officer of EFN, Pett Jarupaiboon. Thanks Pett. The photos, I added them here.

(First, second and third rows, respectively: Bill Stacey, Siggi Herzog, Razeen Sally, Choi Byung-il, Pham Chi Lan, Wan Saiful Wan Jan)

Day 1
(MC for Day 1: Wan Saiful Wan Jan, Chief Executive, Institute for Democracy and Economic Affairs (IDEAS), Malaysia)

Welcoming remarks:
-Bill Stacey, Chairman, LRI
-Siegfried Herzog, Regional Director, FNF Southeast and East Asia

Opening Keynote Address
“Economic Growth and Inequality”
- Dr Razeen Sally
Visiting Assoc. Prof, The Lee Kuan Yew School of Public Policy, The National University of Singapore and Director, European Centre for International Political Economy

Session 1: Insights from the Keynote Address
- Pham Chi Lan, Member of the National Council for Sustainable Development and Competitiveness Enhancement, Vietnam
- Dr Choi Byung-il, Professor, Ewha’s Womans University, Korea
- Hong Kong resident (TBC)
Moderator: Bill Stacey

Session 2: Reality Checking in Asia
Asian Cafe
(Facilitator: Introduced and facilitated by Miklos Romandy, Regional Programme Coordinator, FNF Regional Southeast and East Asia and Traon Pongsopon, Programme Assistant, FNF Thailand)

First round:
- Hong Kong/Peter Wong, Executive Director, LRI/LRI rapporteur
- Thailand/Dr Sethaput Suthiwart-Narueput, Executive Chairman, Thailand Future Foundation/Armin Reinartz, Project Assistant, FNF Southeast and East Asia
- Bangladesh
- Myanmar/Aye Kyaw, Principal of Myanmar Human Resource Institute/Nway Nway Soe, Programme Manager, FNF Myanamr
- Sri Lanka

Second round:
- China/Dr Mao Shoulong, Professor, Academy of Public Policy, Rennmin University/Rachaphum Panichsombat, Senior Analyst, Sasin Institute for Glabal Affairs
- Indonesia/Ulil Absar Abdalla, Freedom Institute, Indonesia/Raja Juliantoni, the Indonesian Institute
- Pakistan
- Mongolia
- Vietnam/Dr Le Dang Doanh, Senior Economist, Association of Vietnam's Economists /Dau Anh Tuan,
Director General of the Legal Department of Vietnam Chamber of Commerce and Industry
- Bhutan

Third round:
- Korea/Dr Kim Chung-Ho, President and CEO, Freedom Factory ltd., Korea (TBC)
- Malaysia/Wan Saiful Wan Jan, Chief Executive, IDEAS, Malaysia/ Fareeza Ibrahim, Southeast Asia Network for Development (SEANET)
- The Philippines/Nonoy Oplas, President, Minimal Government Thinkers, The Philippines
- India
- Nepal
- Cambodia

(By row: (r1) Andrew Work, Barun Mitra, Xingyuan Feng; (r2) Thitinan Pongsudhirak, Ken Schoolland, Ronald Meinardus; (r3) Fred McMahon, Andrew Shuen, John Tsang)

Session 3: Property Rights and Equality
- Andrew Work, Co-Founder, LRI
- Professor, Michael X.Y. Feng, Vice President, Cathay Institute for Public Affairs, China
- Barun Mitra, Director, Liberty Institute, India
- Dr Thitinan Pongsudhirak, Director, Institute of Security and International Studies, Thailand
Moderator: Ken Schoolland, Associate Professor of Economics and Political Science, Hawai‘i Pacific University

Cocktails, Dinner

The Economic Freedom of the World (EFW) Report 2014

Introduction of Speaker:
Dr Ronald Meinardus, Regional Director, FNF South Asia

Introduction to the EFW report, Briefing
Fred McMahon, Fraser Institute Resident Fellow and holder of the Dr Michael A. Walker Research Chair in Economic Freedom, Canada
Presentation of EFW Report 2014 to H.E. John Tsang, Financial Secretary, Hong Kong SAR

Introduction of Speaker:
Andrew Sheun, Co-Founder, LRI

Special Address
H.E. John Tsang, Financial Secretary, Hong Kong SAR

Day 2
(MC For Day 2: Andrew Work, Co-founder, LRI)

Session 4: Conference speed dating for all participants
Facilitators: Miklos Romandy and Traon Pongsopon

Topics discussed
 What do you think about the previous presentations?
 What critique do you have?
 What is your own argument?

Session 5:
Dr Tom Palmer, Executive Vice President for International Programs, the Atlas Economic Research Foundation, USA

Session 6: The AEC: opportunities and challenges
Organised by South East Asia Network for Development (SEANET)

CALD-EFN Asia Joint Session

Welcome Remarks
Hon. Oyun Sanjaasuren, MP Chairperson, Council of Asian Liberals and Democrats
President, United Nations Environmental Assembly
Minister of Environment and Green Development, Mongolia
Co-Chair, Civil Will Green Party of Mongolia
Bill Stacey, Chairperson, LRI, Hong Kong
Hon. Markus Löning (TBC) Former Commissioner for Human Rights, Free Democratic Party of Germany

Keynote Address
Hon. Emily Lau, MP
Legislative Councillor, Hong Kong
Chairperson, Democratic Party of Hong Kong

Panel Discussion on the Liberal Economy and Wealth Disparity

Hon. Sin Chung Kai, MP
Legislative Councillor, Hong Kong Democratic Party of Hong Kong
Individual Member, Council of Asian Liberals and Democrats

Dr Parth Shah (TBC)
President, Centre for Civil Society, India

Hon. Saumura Tioulong, MP
Member of the Cambodian National Assembly
Cambodia National Rescue Party
Former Deputy Governor of the National Bank of Cambodia

Dr Sethaput Suthiwart-Narueput
Executive Chairman, Thailand Future Foundation

Moderator: Jules Maaten, Project Director, FNF Philippines

Leave for the Hong Kong Legislative Council

Gala Dinner for CALD, EFN Asia and LI Participants
(MCs: Armin Reinartz, Project Assistant | China Analyst, FNF Southeast and East Asia Office, and
Jaslyn Go International Liaison and Assistant Treasurer, Singapore Democratic Party)

Dr Juli Minoves – Triquell
President, Liberal International

Bill Stacey (TBC)
Chairperson, LRI

Siegfried Herzog
Regional Director, FNF Southeast and East Asia

Martin Lee
Founding Chairperson, Democratic Party of Hong Kong

Individual Member, Council of Asian Liberals and Democrats and Liberal International

See also: 

Monday, September 29, 2014

Hong Kong Democracy vs. China Dictatorship, Part 2

This is one of the scenes in Hong Kong last night. Photo from @PhelimKine, tweeted last night with this note,

"These images will haunt the #China & #HongKong govts for a very, very long time. #solidarityHK #OccupyCentral "

From the fb photos of the Harbour Times last September 22, 2014:

Student Strike starts. The university mall in the Chinese University of Hong Kong is full. Alex Chow, Hong Kong Federation of Students Secretary-General, urged "Democracy Now!" Lester Shum, the federation's deputy, said "we should be the one who decide the future of Hong Kong.

The Democracy Movement in HK just demands one thing: self determination from Beijing communist government. While Beijing agreed to have direct elections of the HK people by 2017, it vetted that only candidates that are approved by the Beijing-loyal administration can run.

A friend from HK, Andrew Work, posted this yesterday midnight,

Occupy Central becomes a reality. As police clear a way forward in one small area, scores, maybe hundreds of thousands more flow in to replace them. It is completely unmanageable and there will be only a tragic ending. HKFS and OCLP trying to call it off, but the crowd will have none of it. They feel history in the making. This is July 1 2003 times 10. CY cannot stay, and no one can replace him. An impasse....

Whew! Just took a major major gassing, but ok. Stings like a sommmmma thing!

Also last night, another friend in HK, Andrew Shuen, posted this in his fb wall. I added photos below from Harbour Times, not part of Andrew's original posting, The two Andrews are my friends at the Lion Rock Institute, HK's free market think tank, 

When I was a younger man, I remember watching an earlier episode of the West Wing where the President character asked, "what's the benefit of a proportional response?"

Well, I guess we have found out that in governance, what's the disadvantage of a a disproportional response. Where you use police in riot gear and pepper spray against unarmed 17 year olds that merely took over an outdoor area that was previously opened to the public anyways, and where these teenagers were simply sitting down.

Then not only to arrest the 17 year old, but to REFUSE him bail?
This is a monumental fuck up from the perspective of governance.

And that bullshit of the situation turning "violent" which the foreign media loves calling it now. Would you say Martin Luther King's march in Birmingham, Alabama a "violent protest"? Those people just got beaten the crap out of them by the police!

To prove my point, you look at Mongkok right now. The police is outnumbered by a ratio of hundreds, yet people are simply sitting down, no stores are burnt down AND THE POLICE THEMSELVES ARE STILL IN THE NORMAL UNIFORM THEY WEAR DAY IN DAY OUT and not some riot gear.

Now, with nearly every leader of the movement from Joshua Wong Ji Fung to Benny Tai Ting Yiu to Jimmy Lai asking people to disperse and failing, how is this going to end?

If it does involve the People's Liberation Army, it would spell the end of one country two systems. How the fuck could you trigger this level of a constitutional crisis let alone the potential bloodshed through such incompetence? This is monumental incompetence.

Now that the movement has spread to Kowloon, let me make one bold prediction.

CY Leung is finished. The phone call from Beijing asking for his resignation will be coming soon. If it doesn't come by tomorrow, expect to see senior members of government to start resigning soon, starting with members of the Executive Council.

Oh, and one last thing.

If Hong Kong is finished, see the end of the dream of turning the RMB into an interntional reserve currency. For which central bank with a sane mind is going to buy a financial instrument issued in Shanghai, adjudicated by their kangaroo judiciary system?

Trust me, they tried. They are called Panda Bonds, and because no one bought them, Hong Kong had to take over and issue Dim Sum Bonds and sent the RMB into international respectability.

I was surprised to see this young boy, 17 years old Joshua Wong, would somehow scare Beijing and its administrators. This article from WSJ said,

Mr. Wong came to local fame in 2012 after his Scholarism group, made up of secondary school students, protested against a plan by the Hong Kong government to implement “patriotic education” classes in Hong Kong schools. The plan was later shelved. Now, the group is at the forefront of a student movement protesting against a decision by Beijing last month that said that future candidates for Hong Kong’s top post must be vetted by central authorities.

HK police has raided his house last Saturday, September 27.

Meanwhile, Beijing media says their dictatorship will continue, no matter what the HK demonstrators will do. Shameless commies, as always.

The way the current China communist leaders are behaving, they are creating more enemies than friends worldwide. Alienating the governments and people of Japan, S. Korea, Vietnam, Philippines, Taiwan. And now the HK people.

To friends who are still enamored with socialism or communism, your "dictatorship of the proletariat" philosophy is notoriously wrong. Socialists and communists big bosses simply want dictatorship, period.

See Part 1, September 25, 2014

Sunday, September 28, 2014

Free Trade 38: Liberalize Rice Imports and Demonopolize NFA

This is the 2nd part of my paper published by the Stratbase Research Institute (SRI) last April 18, 2014. The first part is about energy deficit in the Philippines. The full paper is posted in slideshare.

(2) Rice prices. PNoy said (SONA 2014),

“…some greedy rice hoarders are stockpiling their supplies in order to sell them when prices eventually rise…. Our immediate solution: import more rice, supply it to the markets, reduce the prices and keep them at a reasonable level, and ultimately drive those who took advantage of the Filipino people into financial ruin.”

Last November, we imported 500,000 metric tons… all of this had arrived by March of this year. This February…  additional 800,000 metric tons,... This July we approved the immediate importation of 500,000 metric tons of rice through open bidding….  Standby authority to import an additional 500,000 metric tons…”

The anomaly actually here is the Philippine government's continuing rice protectionism policy and monopolization or heavy regulation of rice imports, that largely explains for high rice prices.

Rice protectionism via (1) National Food Authority (NFA) rice importation monopoly and (2) maintaining quantitative restrictions (QRs) of our rice imports, and (3) forcing rice "self-sufficiency" policy, are  wrong policies that contribute to expensive rice. They are anti-liberal policies that the Liberal Party should in fact discard while PNoy Aquino is still in power.

Below is a picture of how big our neighbors Vietnam and Thailand are as rice exporters. They simply have huge production relative to their  consumption.

Table 2. Rice Production, Trade and Consumption in East Asia, in ‘000 Metric Tons

Myanmar and Cambodia are fast catching up as major rice producers and consumers, which is a good thing. 

These four countries – Vietnam, Thailand, Myanmar and Cambodia – plus Laos, are all in Southeast Asia mainland.  The rice import-dependent countries – Indonesia, Malaysia and Philippines – are all archipelagic and are outside the Southeast Asia mainland. Is this coincidence or not, that there is an explanation for this?

A paper from Dr. David Dawe of the Food and Agriculture Organization (UN FAO) and reposted in IRRI magazine, “Rice self-sufficiency: A question of geography?” says the answer is No. It is not coincidence.  

Chart 5. Rice Production per Capita vs. Share of Crop Area Devoted to Rice, ASEAN

Countries on SE Asia mainland have dominant river deltas that provide huge water and flat lands, they get big irrigation from Mekong River (water flowing from China down to Laos, Cambodia, Thailand, Vietnam), also from Ton le Sap river (mainly in Cambodia). This flat lands plus huge irrigation are highly  suitable for rice cultivaton.

Rice land in particular,  Vietnam has almost 2x while Thailand has almost 3x that of Philippine rice land area.

Productivity wise, Filipino farmers’ is actually larger than that of their counterparts in Thailand, although lower than those in Vietnam. If Vietnam has the same number of typhoons per year as the Philippines, its productivity would possibly be similar to the Philippines. Vietnam has only about 5 typhoons a year or less, vs. the PH's 19 typhoons a year on average, about half of which make actual landfall and knock down thousands of hectares of often harvestable rice, resulting  in high crop losses.

Table 3. Rice Land and Output, Comparison among the Philippines, Thailand and Vietnam

If we combine those natural factors – being in SE Asia mainland, have huge and wide flat lands, have huge irrigation  water – those in the mainland have high rice output relative to their consumption and hence, rice prices are lower than  those in the Philippines. Why should the Philippine government insist on expensive rice via trade protectionism?

Chart 6. Comparative Wholesale Rice Prices, Philippines, Thailand and Vietnam, 2000-2014

A report from PhilRice also noted this,

"According to the two PhilRice economists, domestic price of rice was up to 75% higher than average global rice prices in 2000. The gap reduced in 2008, but price differential widened again to around 30% in 2012 mainly due to higher import tariffs (of about 50% beyond quantitative restrictions quota) and higher production costs.' (source: http://oryza.com/.../philrice-calls-rice-competitiveness...)

To bring down rice prices and stabilize rice supply, the following modest proposals are advanced.

1. Government should liberalize rice trade and importation, abandon rice protectionism. Remove National Food Authority (NFA) monopoly in rice imports.

2. End the quantitative restrictions (QRs) and convert it to low tariff, ultimately leading to zero tariff, especially for rice imports from our neighbors in the ASEAN.

3. In exchange for rice trade liberalization and removing NFA import monopoly, its accumulated debt, around P155 billion,  may have to be assumed by the national  government. This means taxpayers including those who do not buy NFA rice, will pay for its debt.

4. Certain NFA assets like some warehouses should be privatized. Proceeds from such privatization should be used entirely to retire some of its debt and not be used for any old or new food subsidy programs. This way, NFA debt that  will  be passed on to  the national government and  will  be paid by taxpayers will be smaller.

See also:
Free Trade 34: ASEAN's Bilateral and Regional FTAs, February 27, 2014
Free Trade 35: EU-FNF Forum on 'FDI Engine for Job Growth', May 15, 2014

Free Trade 36: Taxation, Regulations, Trade and Rule of Law in ASEAN, August 05, 2014

Free Trade 37: Multiple Concerns and Regulations in the ASEAN, September 11, 2014

Friday, September 26, 2014

UP Hooligans, Part 4

This article by Prof. Antonio “Tonton” Contreras was widely shared in facebook yesterday. It looks cool, well-written, but not necessarily well-argued. An open letter to the UP Hooligans a.k.a. enemies of UP

Among the urban  legends propagated by this article are,

For some, your act was so abominable to a point that 23 members of the faculty of the School of Economics of your University, my Alma Mater, rushed to defend Abad and condemn you in strong words…
In calling you as enemies, they took the side of Abad. In declaring your act as pure hooliganism, they became instruments for a closure of the dynamics of resistance.

Defend (DBM Sec.) Abad? Took the side of Abad?

The statement of the UPSE faculty members is 11 paragraphs long. Nowhere in that statement it said, explicitly or implicitly, that they are “defending Abad” or “taking the side of Abad”. The opening statement was very clear what they were attacking – violence.
We deplore in the strongest terms the violence perpetrated last Wednesday, September 17, by a group of protesters against Secretary Florencio B. Abad outside the U.P. School of Economics auditorium.

In the statement, they were defending only one thing – freedom of expression without physical violence.  Anyway, I posted this generic comment to my friends who posted Tonton’s articles in their  walls:
I am sure many of those UP students who went inside the UPSE auditorium to listen to Sec. Butch were also activists. They listened, they watched, when they went out, they made an academic paper, or blog post, or posted in their fb or twitter their critical observations or disagreement with the Sec. They can hit the Secretary -- with words and ideas, not with coins and plackards and other forms of physical attacks. I call the former "bold, wild and wise" activists whereas the STAND UP activists are "bold, wild and idiot" activists.

Supporters of the 2nd type of activists did not like it, of course. Here is one exchange. I did not  get his permission to use his comments, so I just refer him here as “Mr. M.” Some readers may be interested to see the other side of the argument, so I  am posting the exchange unaltered, unedited.

Mr. M: Mababait pa nga mga bata ngayon! Kung panahon natin yan Bato, Bote, Bugok na itlog, Bulok na kamatis or baka may kasama pang pillbox , molotov cocktail or granada( if available) ang ipupukol kay Sec. Abad!

Nonoy: Pag govt official like Sec. Abad ang binabato, justified. Pag mga idiot activists ang binabato or ginugulpe, unjustified na kasi human rights violation na; repression of peaceful assembly na. Double talk lang para sigurista.

Mr. M: Sec.Abad should know better than to go to a UP campus and not get some Flack! He got off lightly and unhurt. Just his Pride! For a man with no sense of Honor and Delikadeza! He surely is onion skinned! He should have resigned and not stay on as a cabinet member. His Arrogance like his boss Pnoy and his Lap Dog Perasima are doing more harm than good in the last 2 years of Pres. Pnoy's term. And I voted for Pres.Pnoy, but ano nangyari sa Tuwid na Daan ! Bumaluktot na yata!?

Nonoy: Palusot. The issue is the act of violence by the STAND UP activists. Is it justified? UPSE faculty members said No. UP Pres. said No. Both camps did not say, explicit or implicit, that they are siding with Abad or PNoy or whoever. What they are saying or implying is that people can discuss in UP and advocate same sex marriage, humans and animals marriage, legalization of drugs and prostitution, privatization or further expansion of UP, abolition or further expansion of govt, anything else under the Sun. Do it, speak it, argue passionately -- except using violence. Anyone using violence are low-level minds, have low intellectual caliber for rational debate. By resorting to violence, they show they are plain idiots.

Mr. M. Parang hindi ka naging bata! Mainit ang dugo, mapusok at walang takot! Feeling immortal until the shit hits the fan! Pero Defiant to the end! Yan ang UP student! Yan ang mga Iskolar ng Bayan! You do not agree with what those students did to Sec. Abad!? Being violent for you is low level minded!? You call that Violence!? Parang hindi ka yata napasama sa mga rally noong UP days na truncheon, tear gas, nakulong or hold for 48 hours etc. That is the enviroment of UP not La Salle, UST, Ateneo! But UP! Or you never join any anti government rally or activity nung estudyante ka? Kung panahon nga namin yan for sure some students would be arrested and Sec.Abad would need to go to the E.R? So for you we are low level minded and idiots? UP student ka ba talaga?
5 mins · Like

Nonoy: People are free to do what they want, provided they are accountable for their action or inaction. If those STAND UP activists and their apologists think it was the right thing to do, fine. But other people who do not share their violence mentality are also free to lambast and attack their emotionalism and idiocy. That is what the UPSE faculty members did. They were saying, "Hooligans, do your thing outside of UP, or at least outside of UPSE grounds." If they have to be violent idiots, they should show it elsewhere, not in UPSE grounds.

Mr. M: Then I am a hooligan! And UP hooligan! Am Darn Proud of it!!! : )

Nonoy: Good, That is the right thing to do. Be accountable for one's words and actions.

It's also cool if activists will sing insulting songs while smiling and clapping, as bureaucrats like Butch Abad come out. Another gimik is that the activists will have a group photo with him, all smiling, but at the back there are plackards attacking him, then post in fb or youtube, I think that trick will go viral. No mess, no violence, no controversies, and still effective in attacking him.

I am no fan of Butch myself and the fiscal irresponsibility of this admin -- and all other admins before it. But I can attack them with words and ideas. If thousands of UP students will do the same, many govt bureaucrats will melt.

Mr. M: Sometimes or most of the time, ACTION not words will be more effective for change.....

Nonoy: kanya-kanyang trip yan. People can shoot or stab other people that they dislike actually. So long as people are accountable to their actions, fine. Face the consequences, no running away, no double talk. Pwedeng manggulo or manggulpe ng ibang tao, justified, pero sila hindi pwedeng gulohin at gulpihin, unjustified, kasi human rights violations, kasi abridging freedom of assembly, kasi there is pol. repression, kasi....

To summarize, I am against the use of physical violence and aggression in settling disputes for the following reasons:

1. It is a low-level-mind way of expressing ideas and emotions.

2. It further expands government. It is used as an excuse by the government to keep expanding its armed forces and police and the armaments they wield.

3. Inferior ideas and  dishonest people can be hurt and shamed by truthful and independent analysis. These people use government armed and coercive forces or private armies to harass and terrorize those who  will expose them  and  their  lousy ideas. Thus, the use of violence by the  government or by the activists and/or political opposition in stifling freedom of expression is unjustified. 

See also:
UP Hooligans, Part 2, September 20, 2014
UP Hooligans, Part 3, September 22, 2014

Thursday, September 25, 2014

Climate Tricks 33: UN Fooling Government Leaders to Accept Expensive Energy

Reposting here a good article written by a friend, Dr. Willie Soon, a Malaysian-American astrophysicist at the Harvard-Smithsonian Center for Astrophysics in Boston, and Lord Christopher Moncton. Posted in Washington Times. I have met Willie twice, in NYC in 2009 and in Chicago in 2010.

By Willie Soon and Christopher Monckton - - Thursday, September 18, 2014

Indian Prime Minister Narendra Modi has sensibly declined to attend yet another climate summit — this time called by Ban Ki-moon for Tuesday in New York under the auspices of the United Nations — which profits handsomely from much-exaggerated climate scares. Chinese President Xi Jinping and German Chancellor Angela Merkel likewise intend to skip the event.

Environmentalists have complained about Mr. Modi's decision. They say rising atmospheric carbon dioxide will cause droughts, melt Himalayan ice, and poison lakes and waterways in the Indian subcontinent.

However, the U.N. Intergovernmental Panel on Climate Change has already had to backtrack on earlier assertions that Himalayan glaciers would be gone within 25 years, and the most comprehensive review of drought trends worldwide shows the global land area under drought has decreased throughout the past 30 years.

The spiritual yet down-to-earth Mr. Modi knows that 300 million Indians still have no electricity. His priority is to turn on the lights all over India. In Bihar, four homes in five are still lit by kerosene.

Electric power is the quickest, surest, cheapest way to lift people out of poverty, disease, subsistence agriculture and childhood death — thereby stabilizing India's population, which may soon overtake China's.

The world's governing elites, however, no longer care about poverty. Climate change is their new focus.

For instance, in late August, the Asian Development Bank predicted that warmer weather would cut rice production, rising seas would engulf Mumbai and other coastal megacities, and rainfall would decline by 10 percent to 40 percent across in many Indian provinces.

Garbage in, gospel out. In truth, rice production has risen steadily, sea level is barely rising, and even the U.N.'s climate panel has twice been compelled to admit that there is no evidence of a worldwide change in rainfall.

Subtropical India will not warm by much. Advection would take most of any additional heat poleward. Besides, globally there has been little or no warming for almost two decades. Climate models did not predict that, casting doubt on all of the U.N. climate panel's "projections." The panel, on our advice, has recently all but halved its central estimate of near-term warming.

Sea level is rising no faster than for the past 150 years. From 2004 to 2012, the Envisat satellite reported a rise of one-tenth of an inch. From 2003 to 2009, gravity satellites actually showed sea level falling. Results like these have not hitherto been reported in the mainstream news media.

More than two centuries of scientific research have failed to make the duration or magnitude of monsoons predictable. Monsoons depend on sea and surface temperatures and wind conditions in the Indian and Western Pacific oceans, the timing of El Ninos in the equatorial Pacific, variations in Eurasian and Himalayan winter snow cover, and even wind direction in the equatorial stratosphere.

In 1906, forecasts depended on 28 unknowns. By 2007, scientists from the Indian Institute of Tropical Meteorology were using 73. So insisting that just one variable — atmospheric carbon-dioxide levels — will drive future monsoons is unscientific.

IPCC climate models said monsoons would become more intense. Instead, they have weakened for 50 years.

Models also failed to replicate the 60-year and 200-year cycles in monsoon rainfall linked to solar cycles that are reflected in studies of ocean sediments from the Arabian Sea.

A new study led by K.M. Hiremath of the Indian Institute of Astrophysics shows a strong, possibly causative correlation between variations in solar activity and in monsoon rainfall.

Governments also overlook a key conclusion from the world's modelers, led by Fred Kucharski of the Abdus Salam International Centre for Theoretical Physics: "The increase of greenhouse gases in the 20th century has not significantly contributed to the observed decadal Indian monsoonal rainfall variability."

Not one climate model predicted the severe Indian drought of 2009, followed by the prolonged rains the next year — a one-year increase of 40 percent in most regions. These natural variations are not new. They have happened for tens of thousands of years.

A paper for the scientific journal Climate Dynamics co-authored by B.N. Goswami, recently retired director of the Indian Institute of Tropical Meteorology, shows why the models relied upon by the U.N. climate panel's recent assessments predict monsoons inaccurately.

All 16 models examined have the same fatal flaw: They predict rain too easily, by artificially elevating air and water masses in the atmosphere.

Models are not ready to predict the climate. Misusing computers to spew out multiple "what-if" scenarios is unscientific. This approach simply means "if all our unproven assumptions are correct, this could happen."

Most of the fundamental problems in our still immature understanding of climate have remained unresolved for decades. Some cannot be resolved at all. The U.N.'s climate panel admitted in 2001 what has been known for 50 years: Because climate is a "coupled, non-linear, chaotic object," reliable long-term climate prediction is impossible.

Misuse of climate models as false prophets of doom is costly in lives as well as treasure.

To condemn the poorest of India's poor to continuing poverty is to condemn many to an untimely death. Mr. Modi is right to have no more to do with such murderous nonsense. It is time to put an end to climate summits. On the evidence, they are not needed.

Willie Soon is a solar physicist and climate scientist based in Cambridge, Mass. Lord Monckton is a former expert reviewer for the Fifth Assessment Report of the U.N. Intergovernmental Panel on Climate Change (2013) of the U.N.'s climate panel.

See also::
Climate Tricks 31: High Intolerance by the Alarmist Camp, May 14, 2014
Climate Tricks 32: Yeb Sano and CCC to Save the Arctic, September 16, 2014

Drug Price Control 42: New Round of India Price Caps

 Another round of drug price control in India.
Lessons for the Philippines?
Discussion below, after the news report.

NEW DELHI/MUMBAI Fri Sep 19, 2014 7:34pm IST

(Reuters) - India has capped the prices of 36 drugs, including those used to treat infections and diabetes, in its latest move to make essential medicines more affordable, a senior official of the country's drug pricing authority told Reuters on Friday.

The medicines join a list of 348 drugs deemed essential and that are therefore subject to price caps, covering up to 30 percent of the total medication sold in a country where less than 20 percent of people are covered by health insurance.

"This is a straight-forward, most predictable, overdue action which has been done by us," the official at the National Pharmaceutical Pricing Authority (NPPA) said, declining to be named because of the sensitivity of the matter.

Global and Indian drugmakers have been hit in India by wide-ranging government-imposed price reductions over the last year. Industry officials say prices in the country are already among the lowest in the world, but the cost of drugs is overwhelmingly covered by patients themselves.

India in July capped the prices of more than 100 drugs that are not part of the essential medicines list. The pharmaceutical industry has challenged the move in court.

Indian drugmakers, including Cipla Ltd, Ranbaxy Laboratories Ltd, and Cadila Healthcare Ltd, are among the companies that will be affected by the latest decision, research firm AIOCD Pharmasofttech AWACS said….


More big selling drugs for treatment of diseases including cancer, HIV/AIDS and cardiovascular could be brought under price cap to make them affordable in the country, said Rahul Sharma, an analyst with Mumbai-based brokerage Karvy Stock Broking.

The senior official at the pricing authority said the NPPA was drawing up a list of mass-consumed, essential life-saving drugs which it thinks should be added to the essential medicines list, but did not confirm treatments affected….

What are some lesson for the Philippines from this report?

These are my impressions and observations:

1. Government intervention like price control, once started, is never or hardly reversed and recalled. It only invites more intervention. In this case in India: original 348 drugs in the essential medicines list + more than 100 drugs outside of the essential medicines list last July + 36 drugs this month + “more to come”.

Thus, people should not be enamored or hoodwinked with more government interventions  like price control and their beautiful, bleeding heart promises and justifications. Once started, they acquire their own life and create their own momentum. And such interventions will soon victimize those who asked for it in the first place, either directly or indirectly, like the proverbial "Law of unintended consequences."

2. India’s NPPA could be the “model” of former Cong. Ferjenel Biron, Sen. Manny Villar and other legislators in the last Congress when they were adamantly pushing for the creation of a permanent bureaucracy to be called Drug Price Regulation Board (DPRB). One consolation of PH drug price control experience is that we do not have a permanent bureaucracy with permanent and full time bureaucrats whose main purpose in this planet is to justify endlessly, and expand endlessly, the list of medicines to be put under price dictatorship.

A permanent price control board is very dangerous. The most extortionists, the most corrupt in  government will salivate to head it and use it for harassment and extortion of some players. Like threatening "pay us or we will put your most saleable, most popular drugs under price control". It is happening in India. The NPPA officials have gone outside the essential medicines list.

The DOH Advisory Council on the Implementation of RA 9502 (previously called the Advisory Council for Drug Price Regulation) is a non-permanent agency, just an ad-hoc body that does not even meet regularly.

3. While the original target of price control were the products of west-based innovator multinationals (US, Canada, Europe), continued expansion of price control is now victimizing local companies, generic multinationals:  Ranbaxy Laboratories (5th largest specialty generic pharma in the world),  Cadila Healthcare (5th largest pharma company in India), Cipla  Ltd. (42nd largest publicly traded company by market value in India). Data I got from wiki.

Ranbaxy (or Dr. Reddy’s?) is the India version of Unilab, they are both the biggest pharma in their respective countries.

This is one reason why we do not see or hear any local generic pharma in the Philippines supporting drug price control, in 2009 or now.

A physician friend from PhilHealth, the government-owned social health insurance (SHI) corporation, asked me,
What if the social health insurance provides the cap?One, the cap is meant to protect those that are insured.Two, the covered population provides predictable demandThree, it opens a group of consumers who previously are not buying.. Example,  the poor.. Or not compliant with their medication.. Example, those who have NCDs .What if those who are selling pharma products covered by SHI receives rebate?

Good questions. If the SHI like PhilHealth will provide a price cap to certain medicines that patients will pay, and the selling pharma companies receive a rebate from the SHI, then I think it  is fine. It is not a price control but a price subsidy. It is no different from a rice subsidy (NFA pays high to rice producers and consumers pay low) or MRT/LRT train subsidy (DOTC pays huge money to MRT operators and passengers pay low).

If government should impose a mandatory, forcible price cut (ie, price control), then government should pay the firms that are affected -- through DOH budget or DOF-BIR tax rebate. Government must share burden for some of its bleeding heart programs.

In the current practice of price control, neither the DOH nor the DOF share any burden. And not only for the 19 or so molecules covered by price control of August 2009, but also for the mandatory, forcible price discount of 32 percent (20% forced discount + 12% VAT waiver) for senior citizens and persons with disabilities (PWDs). Not all senior citizens and PWDs are poor that they deserve a forced discount. And not all drugstores, restaurants, bus lines, etc. are rich to shoulder the forced revenue cut. Henry Sy, Gokongwei, Lucio Tan, George Ty, Manny Villar, Sonny Belmonte, Franklin Drilon, FV Ramos, ettc. are no poor yet in the law, they deserve a forced discount and private enterprises are forced to  give them a 32 percent discount. This is a continuing headache for many players in the health sector -- pharma (local and multinational), drugstores, hospitals. Nagtuturuan who should shoulder the biggest burden and the burden inventor, the government, has zero share in the burden sharing.

Some people may ask, "You have criticized a lot of policies, what do you propose?"

Simple. Government should step back, zero  involvement, in pricing by private enterprises. Government should encourage more players and competitors to come in. Competition will drive prices, not only of medicines and vaccines but also lab tests, hospital fees, professional fees. Unless patients will deliberately go to expensive hospitals and physicians, expensive drugstores and  choose expensive  medicines. 

When someone sells fake or counterfeit medicines, anesthesia, vaccines, etc.  and public health is affected, government should come in. Hard and harsh. Why? Because there is clear violation of contract, that sellers and producers should only supply good quality meds, food. It is in the promulgation of the rule of law that I believe in  BIG government. Government should over-spy, over-bureaucratize, over-penalize, criminals,, thieves and  murderers, sellers of fake medicines and adulterated food, etc.

Government should also reduce if not abolish, various taxes and fees on medicines and  vaccines. In many instances, government is a major contributor to  expensive medicines, expensive rice, expensive electricity and so on, via various taxes, charges, fees and royalties on those products and services. Yet government portrays itself as the "champion of the masses" and indirectly demonize the major players via more regulations and prohibitions, like price control policies.

See also: 

Hong Kong Democracy vs. China Dictatorship

I am reposting some interesting reports and opinons here about the ugly turn of events  in  Hong Kong recently where the China Communist Party in Beijing has put its heavy feet on HK people's aspirations for freedom and deeper democratization.

"As the government and bureaucrats find that they typically cannot count on the legislature making new laws, they interpret existing laws with ever wider discretion. The scope of arbitrary regulation is broadening. This does serious damage to the rule of law, although that probably does not start out as the intention." -- Bill Stacey, Chairman, LRI

From the World Street Journal, opinion papers by Hugo Restal:

The people of Hong Kong want China to honor the democratic promises it made when the city became a special administrative region in 1997, and this fight for freedom deserves more world attention—especially as Beijing's counterattack is getting ugly.

Agents from Hong Kong's Independent Commission Against Corruption (ICAC) searched the homes of media tycoon Jimmy Lai, his employee Mark Simon and legislator Lee Cheuk-yan on Thursday. The search warrants covered records of Mr. Lai's donations to Mr. Lee and other pro-democracy politicians. The raid is especially ominous because it suggests that Beijing is compromising the independence of Hong Kong law enforcement....

Such arrests and Thursday's searches risk undermining public respect for the law and the government in general. Ironically it was Jasper Tsang, one of Beijing's staunchest loyalists in Hong Kong, who sounded the alarm last year. When leaders lose the public's trust, he warned, even their good policies will be resented. Beijing's steady erosion of the independent institutions left behind by the British will only increase the desire of Hong Kong's people for greater democracy and autonomy."

I have met and heard Jimmy Lai 10 years ago, during the Economic Freedom Network (EFN) Asia conference in HK, also co-sponsored by LRI. The man was so down to earth. Typical rags to riches, never forgetting his roots and inspiring others, helping freedom-oriented people and groups to secure such freedom in the future. Now his house has been raided by the Beijing-loyal autocrats. Sad.

The people of Hong Kong can plead or protest for democracy all they want, but they can only hold a sham election for Chief Executive in 2017. That was the ruling of China's rubber-stamp National People's Congress on Sunday.

Moderates on both sides of the political spectrum in Hong Kong had urged compromise. They proposed nomination procedures that would satisfy Beijing's concerns while still allowing the free election that China promised in 1997 when it made the city a self-governing special administrative region for 50 years. Beijing not only rejected these ideas, it seems they were never seriously considered. The Communist Party insists on absolute veto power over the choice of candidates....

This Putinist politics gets a pro-business gloss because most of the city's richest businessmen long ago submitted to Beijing's will. Last week Wang Zhenmin, the dean of the Tsinghua University Law School, was sent to Hong Kong to explain that the electoral system is designed to please the business elite: "If we just ignore their interests, the Hong Kong capitalism will stop. So that's why on the one hand we realize universal suffrage in Hong Kong, on the other hand we must guarantee the continued development of capitalism in Hong Kong."

The threat to Hong Kong's capitalism comes not from democracy, but from the cronyism and erosion of the rule of law that are infiltrating from the mainland. Businessmen may want to curry favor with politicians, but it is competition that drives capitalist prosperity. Beijing foolishly believes that turning Hong Kong into a paradise for oligarchs will make it easier to control....

The tragedy for both Hong Kong and China is that the conflict is unnecessary. The city is manifestly ready for democracy, which would give Beijing fewer headaches rather than more. The cautious and pragmatic population would never elect the populist firebrand that Beijing fears. Instead a vibrant city is caught in a downward spiral of disaffection and fear. Mr. Xi deserves the blame for the consequences." -- Hugo Restall

Britain's Betrayal of Hong Kong

A political showdown looms in Hong Kong. Beijing has stripped the city of the high degree of autonomy it promised in a 1984 treaty with the United Kingdom. Local residents are preparing a campaign of civil disobedience in protest. Yet London has failed to express even mild criticism of Beijing's treaty violation.

The people of Hong Kong overwhelmingly want to elect their next Chief Executive, a reform that until a month ago seemed within reach. On Monday university and secondary students began a week-long boycott of classes to demonstrate for democracy. A new poll from Chinese University shows that one-fifth of the population is considering emigration because of the city's uncertain future.

This turmoil is the result of Beijing's shock decision at the end of August to rig the 2017 Chief Executive election with the most antidemocratic system tabled by its local supporters. Only politicians who receive majority support from a committee packed with Beijing's supporters will be allowed to run....

As a signatory to the Joint Declaration, only the U.K. has the legal standing to protest Beijing's broken promises. So how did London respond? For four days, the Foreign Office said nothing. Finally it put out a statement even more abject than silence: "We welcome the confirmation that China's objective is for the election of Hong Kong's Chief Executive through universal suffrage." Martin Lee, Hong Kong's doughtiest fighter for democracy, rightly summed up London's attitude as "kowtowing to Beijing for 30 pieces of silver."

It's true Britain's power to influence developments in Hong Kong is limited. Yet Beijing's xenophobic bluster shows that it still fears a principled statement from London to defend the territory's autonomy. Chinese media routinely accuse pro-democracy politicians of being funded by foreign "black money"—even as Beijing pumps money into local puppet groups.

When Margaret Thatcher agreed to return Hong Kong to Chinese sovereignty, she defended the decision on grounds that the U.K. would hold Beijing to its treaty commitments. Count that as one more Thatcherite legacy her successors have failed to honor. -- Hugo Restall, 

This news 3 weeks ago says that Britain did write to Beijing and the latter was upset.

The letter from the Beijing foreign affairs committee said the British probe, announced in July, would be a “highly inappropriate act which constitutes interference in China’s internal affairs”.

It urged lawmakers to “act with caution on the issue of Hong Kong, bear in mind the larger picture of China-UK relations and Hong Kong’s prosperity and stability, stop interfering in Hong Kong’s affairs and cancel the inquiry on UK-Hong Kong relations.

See also:
John Cowperthwaite, Statistics and Central Planning, January 23, 2014
Free Trade 32: Hong Kong's Unilateral Trade Liberalization and John Cowperthwaite, February 12, 2014
Lion Rock 12: Bill Stacey on Free Markets, Big Government and Hong Kong, March 10, 2014
Hong Kong's Corporate and Forest Jungle, June 10, 2014
FDIs, Hong Kong Democracy and China Communism, July 10,  2014

Monday, September 22, 2014

UP Hooligans, Part 3

Below is a  statement released today.

Posted on September 22, 2014 by upweb_wordpress in Announcements

A few days ago, a disturbing incident happened at the University of the Philippines Diliman.  A group of protesters, consisting of some UP students, confronted Department of Budget and Management Secretary Florencio B. Abad outside the UP School of Economics auditorium.  He was then leaving a forum, where he was one of the speakers.  According to media reports, Secretary Abad was subjected to verbal indignities and the protesters hurled “placards, crumpled papers and coins” at him.

The forum was organized by the UP Diliman University Student Council and the UP School of Economics Student Council to discuss the proposed UP budget. Reportedly, the forum also discussed the disbursement acceleration program of the government.

Secretary Abad, as an invited speaker in this UP student forum, should have been accorded the courtesy and respect due to all guests of the University. While UP constituents are free to actively express their views on issues that affect our nation, such as the proper use of public funds, UP does not condone the use of violence in any manner against any person, be it a member of the university community, a visitor, or a government official.

UP Diliman is now investigating the reported incident in accordance with the University’s rules, including the participation of people who are not affiliated with UP.

I have always maintained that as the country’s national university, UP must lead the debate on important issues confronting the country.  UP must also uphold the time-honored tradition of dissent vis-a-vis questionable government policies. But debate and dissent, while articulated with passion, require evidence-based and reasoned arguments, and civility to and respect for those who hold the opposite view.  Abusive words and deeds have no place in the hallowed grounds of the University.

Alfredo E. Pascual

Meanwhile, I am curious about the stand of the UP Student Council (USC), the co-organizer of the forum.

A friend said that the violent activists are part of the youth being "bold and wild". Maybe, but what do we call the UP students who  listened to the presentation by the Secretary, then form their own opinions to be expressed later as academic papers, tweets, facebook and blog postings, they are not "bold and wild"? I think we can call the latter as "bold, wild and wise" while the latter are "bold, wild and violent".

Put the government scoundrels and DAP architects in  jail, yes, I agree with that. But there is a process; bureaucratic and time consuming, politics tainted process. It can exonerate some people, or it can convict and  imprison them. Two former Presidents have been imprisoned already, Erap and Gloria, although the former was pardoned and set free. Three Senators are in jails already on corruption charges.

It is a bureaucratic but more transparent process, rather than throwing-shouting-body dragging process. If such acts by the activists can be justified, then similar acts by the counter-activists can also be justified. And we can easily go the uncivil mob rule. Whoever has more violent men and women can win an argument and rule.

Meanwhile, Bayaan Mo Na has issued statement. They are saying that he time for non-sober, violence-inspired discourse should be the norm. If you are a speaker in a public forum and they know your position before and they do not like it, they can wait for you outside, throw things and drag and hurt you if they want.

And the student activists involved in violence made this arrogant statement.

Sorry, Not Sorry

"Had we been intent on hurting him and disrupting the event, we would have barged right into the auditorium while he was prattling to students, mauling everyone who got in our way.

But with all the restraint our indignant group could muster, we waited for him outside because inside, in the so-called venue for dialogue, only five minutes were allotted for the open forum and questions from the audience were filtered. Contrary to what Abad would like everyone to believe that he was more than willing to engage with us, he wanted to evade us and even tried getting away through a fire exit and a window!UP President Pascual, instead of apologizing to Abad, should have given him a tip or two on how to dialogue with UP protesters. You stop in front of the crowd, speak, and facilitate a discussion. These, Abad never did or even attempted to do."

No names, no one would own  up to such arrogant statement. Cowards.

See also:
UP Hooligans, Part 2, September 20, 2014

Sunday, September 21, 2014

Mining 41: Presentation at the UP MINERS Forum

The UP Mining Engineering Society (UP MINERS), an organization of BS Mining Eng'g majors in  UP Diliman, organized a forum on "Enlight EM Up" last Thursday, September 18, 2014. Thanks to Neil Esber, a member of the organization and in charge  of the event, for inviting me.

Good audience, though most  of them  are Eng'g majors, very few from the School of Economics.

There were two other speakers. Engr. Velasco  of the Mines and Geosciences Bureau (MGB, DENR) spoke first. Photo below,  from left: Neil Esber, Dexie Baay, President  of UP MINERS, and Engr. Velasco.

The third speaker was JB Baylon of Nickel Asia Corporation (NAC). JB is a friend since the 80s in UP Diliman undergrad. He is enjoying his new career and new company. He used to be with Coca Cole PH before joining NAC.

My presentation is 28 slides, available in slideshare. I will post only a few slides here, like some  basic data about the sector.

Fantastic, the  PH was #1 nickel producer worldwide in 2012. Australia and New Caledonia though, have the biggest nickel reserves.

When taxation and other policies are too restrictive or intimidating for other potential players, society is the net loser.

The tax-tax-tax thinking NGOs and bureaucracy are wrong if they think that higher tax rates automatically means higher tax revenues for the government. Even John Maynard Keynes share the same idea with Arthur Laffer that there is only an optimum (not maximum) level of tax rate that can maximize government revenues. Beyond that optimum level, revenues will decline.

Engr. Velasco  earlier explained the various permits and documentary requirements that big mining companies must submit to them; otherwise they will not get MGB permits and certificates. The list of documents is long, meaning  the requirements are plenty. That's for MGB alone. For the DOF-BIR, local governments, the list of taxes, fees and royalties is also long.