An Unfortunate Decision by Peter Orszag - James Fallows - Politics - The Atlantic

James Fallows discussed An Unfortunate Decision by Peter Orszag, and, "change we can believe in."

US charges scientist with economic espionage: Scientific American

US charges scientist with economic espionage: Scientific American:

By Sharon Weinberger

Could publishing a scientific article constitute an act of economic espionage? That question lies at the heart of charges against a Massachusetts-based scientist accused of passing U.S. trade secrets to China.

Ke-xue Huang, a Canadian citizen and permanent U.S. resident, was arrested on July 13, and has been charged under a law designed to protect intellectual property held by U.S. companies. At a bail hearing last week in Massachusetts, the U.S. government claimed that the scientist provided secrets belonging to Dow AgroSciences, based in Indianapolis, Ind., to the Hunan Normal University in Changsha, China. If convicted of passing the secrets, said to be worth some $100 million, Huang could face up to 15 years in prison for each of 12 counts of economic espionage.

Congress passed the Economic Espionage Act in 1996 to counter an apparent rise in foreign spies trading in commercial, rather than military, secrets. Six other cases have been prosecuted under the law, but Huang's could set a precedent for the law to be applied to industry scientists and academic researchers publishing in the open literature. This isn't the first time a scientist has faced prison time for sharing research with China; a physicist at the University of Tennessee, Knoxville, was last year sentenced to four years in prison for violating export control laws. He had provided technical data to scientists in China and worked on sensitive technologies with foreign graduate students.

"It is interesting that there are--or seem to be--more cases of research triggering some government reaction, whether this is due to export control or other issues," says Thomas Zurbuchen, a space scientist at the University of Michigan in Ann Arbor who has been involved in efforts to reform export control restrictions on universities.

Huang's problems stem from research related to a review article. Co-authored with scientists at Hunan Normal University and James Zahn, a researcher at Coskata, a biofuel company in Warrenville, Ill., the paper describes work on a new class of insecticides that Dow has been making and marketing. The government alleges that the article contains confidential information--and that publishing it constituted theft of a trade secret, says James Duggan, Huang's lawyer. At the hearing, however, prosecutors indicated that the article is not the sole basis for the charges, which also involve e-mail communications relating to the research.

Huang worked for Dow from 2003 to 2008, but by the time of his arrest had moved to Qteros, a company based in Marlborough, Mass., that works on biofuels.

Originally from China, Huang had studied biology at China's Jilin Agricultural University, and earned a PhD in Japan. After a two-year postdoctoral stint in the mid-1990s at Texas A&M University in College Station, where he worked on sequencing biosynthetic genes for vitamin B12 production, he went to Rice University in Houston. His postdoctoral adviser there, George Bennett, says he "couldn't imagine" Huang intentionally doing something illegal. Dow has declined to comment on any specifics of the case.

Todd Sullivan, an attorney in Raleigh, N.C., who specializes in trade-secret laws, compares economic espionage prosecutions to "unicorn sightings" because the government so rarely pursues them. The government has, in fact, successfully tried only one of the other six economic espionage cases. In another case, last year, a jury acquitted two Chinese-born engineers who had been charged with stealing secrets from a Californian semiconductor company and passing them on to China.

Huang's case resembles the others in that all but one involved China and Chinese scientists. The challenge for the U.S. government will be proving that he provided intellectual property to benefit a foreign government, or an entity controlled by a foreign government. June Teufel Dreyer, a political scientist at the University of Miami in Florida who follows Chinese espionage cases, says it will be "devilishly difficult" for prosecutors to prove that a university is controlled by the Chinese government.

But the Department of Justice is clearly determined to try. The government is fighting attempts to release Huang on bail, and has asked that, even if he is released, his use of the Internet and e-mail be restricted.

In the meantime, Duggan says that he does not concede that his client stole trade secrets, or even that he violated any employment agreement with Dow. He says that Huang was motivated not by espionage, but by his desire to improve insecticides and benefit crop production. "His motives were excellent motives," Duggan insists. "Dow's motives are to protect its profits."

Best Summer Jobs

Via NPR, a girl remembers her summer job at Seaworld Ohio:

And I would then pluck out the oyster, open it up with a knife and then just really plum around, dig around in that oyster for the pearl. I'd be really excited to find this pearl. If I wasn't excited, I'd feign the excitement. Then I'd wash it over, measure the diameter, and then I would tell them, I would appraise the pearl for them.

Mind you, I'm 15 years old, and the only instructions I really got from my supervisor was just to name two things: the color, the size. Then it was really my choice of how much price value to assign the pearl. So I would say: This rare black pearl measures eight millimeters in diameter. This would fetch you about $30 on the market, but here at SeaWorld, you only paid for the price of the mug. And, you know, of course, how could you not be excited by that? Look at that deal you just got, this treasure? These were seed pearls. They weren't, like, 100 percent pure, natural, rare pearls, of course not. Like, a seven-millimeter plastic ball with the thickness of, like, a fingernail coating of pearl on top. So kind of a sham, the whole appraisal.

I am kind of embarrassed to have been a teenage huckster in my very first job, but I'm really glad that I did. I think it's given me a lot of confidence. It really helped me to deliver what I have to say with assurance, and I can really see that now as a teacher.
No one wants a teacher who's just going to stand up and lecture about metaphor or simile or personification but, you know, if you can kind of make it more fun and deliver it in such a way that makes it interesting, then you're golden.

So, we were told that a sham appraisal experience as teenager helped her to gain confidence and be a good teacher.

I agree that teacher should make it fun and deliver it in an interesting way, but it is another thing when you try to make, or sell, a point by making things up. The distinction seems not to matter any more. Even those buying the pearls at Seaworld knew that the pearls are not authentic. A small "trick" is accepted. To tell "small" lies confidently is one of the most important traits needed for any job you can find today. If you can tell lies of any size confidently, that is even better. Maybe every teenager should take a job a husker or car dealer to help them to pursue their career later on.

World Cup 2010 and Referees

Every one seems to be frustrated by the frequency of mistakes of referees in the important matches. FIFA insist on not allowing the referees use video recording and other technologies means to resolve the problem. It is simply ridiculous to reject the means at hands to make huge improvement. Yes, injustice is part of life, and mistakes are inevitable even equipped with the best technology. Accepting the status quo is another matter. Most of the mistakes nowadays are so obvious to everyone in the world in front of the screens, but not those referees in the field. Do they need such information most? It takes only a second of replay to find out that the first goal of Argentina today should be discredited, but after we saw the replay, we witnessed that referees discussed it for another minute surrounded by feverish members from both teams and made the wrong call. What is the justification of refusing the access of such information to the referees in the field when they need it, especially when the rest of the world can see it? 

iOS 4

Updating my iPhone 3gs to iOS4. The jailbreak crashed weeks ago after updating Stanza. The phone died totally. I restore the iPhone to official os. With the multitasking and folders of iOS 4, less need to jailbreak. Will jailbreak if I am going abroad. Before that, I will stick with the official OS for a while. 

My Father's Day Essay for the WSJ, Bryan Caplan | EconLog | Library of Economics and Liberty

Bryan's Father's Day Essay for the WSJ, Bryan Caplan | EconLog | Library of Economics and Liberty

I kinda like Jason's comment:

A bigger problem, I think, is that behavior genetics currently answers questions too crudely to be helpful to parents.

Can't parents who drop $100,000+ on a high status college education expect better outcomes for their children than parents who don't provide this opportunity? Logically, you would think that parents who provide costly opportunities would be dramatically affecting their child outcomes. But behavior genetic studies suggest that parental socioeconomic status doesn't do much.

Why not?

Is it because the poor parents are spending proportionately more on opportunities than rich parents? Or is it because children somehow compensate in proportion to their own abilities (e.g. making due with student loans)? Or is it because the supposed advantages of fancy colleges are a spurious reflection of student ability (consistent with Dale and Krueger)?

Behavior genetics doesn't yet help distinguish between explanations like the first and third AFAIK. But if parents take the research to indicate something like the third explanation, when the true explanation is the first, the consequences of that misinterpretation could be severe.

and:

By the way, this is one problem I potentially have with Dr. Caplan's new book. He is advocating the idea that behavior genetics indicates parents can invest less in their children without consequences. While I do suspect this is true, the same research could conceivably be indicating the opposite. Which would mean that Dr. Caplan's suggestions could be harmful.

I worry the money investment less. I probably gonna support my kids the best I can afford and the best they can get into. The implication in Bryan's essay that the education is less important than the gene, so parents can skip the nightly reading without feeling guilty troubles me more. Education is one of the most important part of raising the kid. I don't need statistics to tell what a nightly reading can do. I can see it, and I love it.

I'd like to see the original research, but I am still in doubt.

A best father's gift

Wall Street Journal gave me a best father's gift: a relief from the stress of raising kids.
The Case for Having More Kids - WSJ.com

Father's Day is a time to reflect on whether you want to be a parent—or want to be a parent again. If you simply don't like kids, research has little to say to you. If however you're interested in kids, but scared of the sacrifices, research has two big lessons. First, parents' sacrifice is much smaller than it looks, and childless and single is far inferior to married with children. Second, parents' sacrifice is much larger than it has to be. Twin and adoption research shows that you don't have to go the extra mile to prepare your kids for the future. Instead of trying to mold your children into perfect adults, you can safely kick back, relax and enjoy your journey together—and seriously consider adding another passenger.

Thank you Bryan! I am watching World Cup 2010 on the couch with my son. At least I can rest my mind for today. This does not mean that I agree with you though.

I was wrong about Apple iPad | Betanews

I was wrong about Apple iPad | Betanews

Keyword: Immersion.

But I missed the iPad and couldn't quite say why at first. I didn't need the device. Functionally, iPad overlapped with smartphone and laptop.

I was wrong. On further reflection, I realized that iPad offers fresh functionality: Immersion. I find there are fewer reading distractions, and content is better presented than on a laptop and browser. I'm more focused and retain more of what I read. For reasons not easily explained, I find myself more thoroughly reading iBooks than defaulting to the skimming I sometimes do with physical books. Part of this immersive experience is the technology, but also how iPad is used. Apple's tablet is a sit down and focus device, as much because of size and shape as screen and user interface. The totality -- physical design and software benefits -- is immersion.

I would rather call it user experience, not functionality. And Steve Jobs got it right again, user experience is more important than functionality or the spec sheet.

Pre-order Iphone 4? Good luck!

It is a mess. After the pre-order going alive, ATT server seems unable to handle it, and gave various error messages. Later, to make matter worse, an alleged privacy breach followed by server shutdown. It is up now, but still unable order the much anticipated iPhone 4.

Is this bad for Apple, or it does not matter?

Gizmodo used words like  a total disaster, well, they have reasons to be angry. 

Wireless LAN security myths that won't die | ZDNet

Wireless LAN security myths that won't die | ZDNet

Waste of money, resources, time

• MAC filtering
• Disable DHCP and use Static IP addresses
• Signal suppression with expensive paint or antenna placement

Worse than no wireless security at all

• LEAP (adding EAP-FAST to the list)
• SSID Access Point beacon suppression (or "hiding")

Has nothing to do with security mechanisms

• Just use 802.11a or Bluetooth

I am using two of them: MAC filtering and hiding SSID. I think the key message in the article is clear and valid:

Any benefit against casual bandwidth thieves is already covered by real security measures... [and] they don't make you harder to hack.

Beware of Americans Proselytizing the Chinese Economic Model « Business in The Beltway - Forbes.com

Beware of Americans Proselytizing the Chinese Economic Model « Business in The Beltway - Forbes.com

My [Dan Ikenson's] bet is that China’s re-embrace of greater central planning will be brief, as it wastes resources, yields few if any national champions, and limits innovation. For similar reasons, U.S. opinion leaders will eschew central planning, as well.

After massive privatization, the tides are receding. The state-owned companies now claim themselves "eldest-son".

The mega-projects like World Expo, the hi-speed rails, and etc, can easily won China some champions, but can we ignore the "unavoidable" problems such as extensive waste? The long-term effects of such mega-projects are positive or negative?

A 2.5-year old uses an iPad for the first time

A 2.5 Year-Old Uses an iPad for the First Time

I can imagine how my "iphone-savvy" 2-year old son would interact with the iPad. Touch is the way to go. It is intuitive and hard-wired in the brain. Just look at the toddlers and seniors. who are not typically target customers of gadgets designers.

Immigration overhaul

It seems that my guess is right. The NYT piece about China Drawing High-Tech Research From U.S. has an agenda more than just research spending or competing with China. It is also an effort to push for immigration reform.
 

It minimizes access for future blue-collar foreign workers and favors visas for highly educated immigrants.

The plan’s emphasis is on making it easier for highly skilled and educated immigrants to come to the United States, including awarding residence documents known as green cards to those who receive advanced degrees in science and technology from American universities.

Currency Manipulator? - Reading List

Paul Krugman

James Fallows


Michael Pettis

China Drawing High-Tech Research From U.S. - NYTimes.com

China Drawing High-Tech Research From U.S. - NYTimes.com

The Chinese market is surging for electricity, cars and much more, and companies are concluding that their researchers need to be close to factories and consumers alike. Applied Materials set up its latest solar research labs here after estimating that China would be producing two-thirds of the world’s solar panels by the end of this year.

...

With China’s economy gaining strength, Mr. Pinto and his wife, then living in Santa Clara, began insisting in 2005 that their sons study Chinese once a week.

Now 10 and 11, the boys are improving their Chinese and mastering the art of eating with chopsticks.

A large portion of Ph.D.s in engineering and science graduating in the U.S. are born in China (and India). They work for the exact same companies after the graduation in the U.S. The only differences are the working location and hassle of dealing with visas and immigration. The best and smartest are among these students. To be frank, many of them do not need a Ph.D. degree or the training in American universities to be good engineers. Many of them just use the graduate training as channel to get to the U.S. It is just convenient for the companies to open the R&D centers in China and lure the best and smartest with the companies' reputation as technology leaders and high (in local terms) pay before they spend the probably unnecessary years in American graduate school, and thus they surely will demand even higher salary.

Microsoft and Google started this long ago. Bill Gates said before the congress during a hearing about H1B visa that these students will work for the big name companies [after graduation], just a matter of where and which companies. And now, many of them may even skip the American graduate school step.

Complexity and Collapse by Niall Ferguson

Complexity and Collapse. By: Ferguson, Niall, Foreign Affairs, 00157120, Mar/Apr2010, Vol. 89, Issue 2

Section: Essays

Complexity and Collapse

Empires on the Edge of Chaos

THERE IS no better illustration of the life cycle of a great power than The Course of Empire, a series of five paintings by Thomas Cole that hang in the New-York Historical Society. Cole was a founder of the Hudson River School and one of the pioneers of nineteenth-century American landscape painting; in The Course of Empire, he beautifully captured a theory of imperial rise and fall to which most people remain in thrall to this day.

Each of the five imagined scenes depicts the mouth of a great river beneath a rocky outcrop. In the first, The Savage State, a lush wilderness is populated by a handful of hunter-gatherers eking out a primitive existence at the break of a stormy dawn. The second picture, The Arcadian or Pastoral State, is of an agrarian idyll: the inhabitants have cleared the trees, planted fields, and built an elegant Greek temple. The third and largest of the paintings is The Consummation of Empire. Now, the landscape is covered by a magnificent marble entrepôt, and the contented farmer-philosophers of the previous tableau have been replaced by a throng of opulently clad merchants, proconsuls, and citizen-consumers. It is midday in the life cycle. Then comes Destruction. The city is ablaze, its citizens fleeing an invading horde that rapes and pillages beneath a brooding evening sky. Finally, the moon rises over the fifth painting, Desolation. There is not a living soul to be seen, only a few decaying columns and colonnades overgrown by briars and ivy.

Conceived in the mid-1830s, Cole's great pentaptych has a clear message: all empires, no matter how magnificent, are condemned to decline and fall. The implicit suggestion was that the young American republic of Cole's age would be better served by sticking to its bucolic first principles and resisting the imperial temptations of commerce, conquest, and colonization.

For centuries, historians, political theorists, anthropologists, and the public at large have tended to think about empires in such cyclical and gradual terms. "The best instituted governments," the British political philosopher Henry St. John, First Viscount Bolingbroke, wrote in 1738, "carry in them the seeds of their destruction: and, though they grow and improve for a time, they will soon tend visibly to their dissolution. Every hour they live is an hour the less that they have to live."

Idealists and materialists alike have shared that assumption. In his book Scienza nuova, the Italian philosopher Giambattista Vico describes all civilizations as passing through three phases: the divine, the heroic, and the human, finally dissolving into what Vico called "the barbarism of reflection." For Hegel and Marx, it was the dialectic that gave history its unmistakable beat. History was seasonal for Oswald Spengler, the German historian, who wrote in his 1918-22 book, The Decline of the West, that the nineteenth century had been "the winter of the West, the victory of materialism and skepticism, of socialism, parliamentarianism, and money." The British historian Arnold Toynbee's universal theory of civilization proposed a cycle of challenge, response, and suicide. Each of these models is different, but all share the idea that history has rhythm.

Although hardly anyone reads Spengler or Toynbee today, similar strains of thought are visible in contemporary bestsellers. Paul Kennedy's The Rise and Fall of the Great Powers is another work of cyclical history--despite its profusion of statistical tables, which at first sight make it seem the very antithesis of Spenglerian grand theory. In Kennedy's model, great powers rise and fall according to the growth rates of their industrial bases and the costs of their imperial commitments relative to their GDPS. Just as in Cole's The Course of Empire, imperial expansion carries the seeds of future decline. As Kennedy writes, "If a state over-extends itself strategically . . . it runs the risk that the potential benefits from external expansion may be outweighed by the great expense of it all." This phenomenon of "imperial overstretch," Kennedy argues, is common to all great powers. In 1987, when Kennedy's book was published, the United States worried that it might be succumbing to this disease. Just because the Soviet Union fell first did not necessarily invalidate the hypothesis.

More recently, it is Jared Diamond, an anthropologist, who has captured the public imagination with a grand theory of rise and fall. His 2005 book, Collapse: How Societies Choose to Fail or Succeed, is cyclical history for the so-called Green Age: tales of past societies, from seventeenth-century Easter Island to twenty-first-century China, that risked, or now risk, destroying themselves by abusing their natural environments. Diamond quotes John Lloyd Stevens, the American explorer and amateur archaeologist who discovered the eerily dead Mayan cities of Mexico: "Here were the remains of a cultivated, polished, and peculiar people, who had passed through all the stages incident to the rise and fall of nations, reached their golden age, and perished." According to Diamond, the Maya fell into a classic Malthusian trap as their population grew larger than their fragile and inefficient agricultural system could support. More people meant more cultivation, but more cultivation meant deforestation, erosion, drought, and soil exhaustion. The result was civil war over dwindling resources and, finally, collapse.

Diamond's warning is that today's world could go the way of the Maya. This is an important message, no doubt. But in reviving the cyclical theory of history, Collapse reproduces an old conceptual defect. Diamond makes the mistake of focusing on what historians of the French Annales school called la longue durée, the long term. No matter whether civilizations commit suicide culturally, economically, or ecologically, the downfall is very protracted. Just as it takes centuries for imperial overstretch to undermine a great power, so, too, does it take centuries to wreck an ecosystem. As Diamond points out, political leaders in almost any society--primitive or sophisticated--have little incentive to address problems that are unlikely to manifest themselves for a hundred years or more.

Did the proconsuls in Cole's The Consummation of Empire really care if the fate of their great-great-grandchildren was destruction? No. Would they have accepted a tax increase that would have financed a preemptive strike against the next millennium's barbarian horde? Again, no. As the UN Climate Change Conference in Copenhagen last December made clear, rhetorical pleas to save the planet for future generations are insufficient to overcome the conflicts over economic distribution between rich and poor countries that exist in the here and now.

The current economic challenges facing the United States are also often represented as long-term threats. It is the slow march of demographics--which is driving up the ratio of retirees to workers--and not current policy, that condemns the public finances of the United States to sink deeper into the red. According to the Congressional Budget Office's "alternative fiscal scenario," which takes into account likely changes in government policy, public debt could rise from 44 percent before the financial crisis to a staggering 716 percent by 2080. In its "extended-baseline scenario," which assumes current policies will remain the same, the figure is closer to 280 percent. It hardly seems to matter which number is correct. Is there a single member of Congress who is willing to cut entitlements or increase taxes in order to avert a crisis that will culminate only when today's babies are retirees?

Similarly, when it comes to the global economy, the wheel of history seems to revolve slowly, like an old water mill in high summer. Some projections suggest that China's GDP will overtake the United States' GDP in 2027; others say that this will not happen until 2040. By 2050, India's economy will supposedly catch up with that of the United States, too. But to many, these great changes in the balance of economic power seem very remote compared with the timeframe for the deployment of U.S. soldiers to Afghanistan and then their withdrawal, for which the unit of account is months, not years, much less decades.

Yet it is possible that this whole conceptual framework is, in fact, flawed. Perhaps Cole's artistic representation of imperial birth, growth, and eventual death is a misrepresentation of the historical process. What if history is not cyclical and slow moving but arrhythmic--at times almost stationary, but also capable of accelerating suddenly, like a sports car? What if collapse does not arrive over a number of centuries but comes suddenly, like a thief in the night?

WHEN GOOD SYSTEMS GO BAD

GREAT POWERS and empires are, I would suggest, complex systems, made up of a very large number of interacting components that are asymmetrically organized, which means their construction more resembles a termite hill than an Egyptian pyramid. They operate somewhere between order and disorder--on "the edge of chaos," in the phrase of the computer scientist Christopher Langton. Such systems can appear to operate quite stably for some time; they seem to be in equilibrium but are, in fact, constantly adapting. But there comes a moment when complex systems "go critical." A very small trigger can set off a "phase transition" from a benign equilibrium to a crisis--a single grain of sand causes a whole pile to collapse, or a butterfly flaps its wings in the Amazon and brings about a hurricane in southeastern England.

Not long after such crises happen, historians arrive on the scene. They are the scholars who specialize in the study of "fat tail" events--the low-frequency, high-impact moments that inhabit the tails of probability distributions, such as wars, revolutions, financial crashes, and imperial collapses. But historians often  misunderstand complexity in decoding these events. They are trained to explain calamity in terms of long-term causes, often dating back decades. This is what Nassim Taleb rightly condemned in The Black Swan as "the narrative fallacy": the construction of psychologically satisfying stories on the principle of post hoc, ergo propter hoc.

Drawing casual inferences about causation is an age-old habit. Take World War I. A huge war breaks out in the summer of 1914, to the great surprise of nearly everyone. Before long, historians have devised a story line commensurate with the disaster: a treaty governing the neutrality of Belgium that was signed in 1839, the waning of Ottoman power in the Balkans dating back to the 1870s, and malevolent Germans and the navy they began building in 1897. A contemporary version of this fallacy traces the 9/11 attacks back to the Egyptian government's 1966 execution of Sayyid Qutb, the Islamist writer who inspired the Muslim Brotherhood. Most recently, the financial crisis that began in 2007 has been attributed to measures of financial deregulation taken in the United States in the 1980s.

In reality, the proximate triggers of a crisis are often sufficient to explain the sudden shift from a good equilibrium to a bad mess. Thus, World War I was actually caused by a series of diplomatic miscalculations in the summer of 1914, the real origins of 9/11 lie in the politics of Saudi Arabia in the 1990s, and the financial crisis was principally due to errors in monetary policy by the U.S. Federal Reserve and to China's rapid accumulation of dollar reserves after 2001. Most of the fat-tail phenomena that historians study are not the climaxes of prolonged and deterministic story lines; instead, they represent perturbations, and sometimes the complete breakdowns, of complex systems.

To understand complexity, it is helpful to examine how natural scientists use the concept. Think of the spontaneous organization of half a million ants or termites, which allows them to construct complex hills and nests, or the fractal geometry of water molecules as they form intricate snowflakes. Human intelligence itself is a complex system, a product of the interaction of billions of neurons in the central nervous system, or what Charles Sherrington, the pioneering neuroscientist, called "an enchanted loom."

The political and economic structures made by humans share many of the features of complex adaptive systems. Heterodox economists such as W. Brian Arthur have been arguing along these lines for decades. To Arthur, a complex economy is characterized by the interaction of dispersed agents, a lack of central control, multiple levels of organization, continual adaptation, incessant creation of new market niches, and the absence of general equilibrium. This conception of economics goes beyond both Adam Smith's hallowed idea that an "invisible hand" causes markets to work through the interactions of profit-maximizing individuals and Friedrich von Hayek's critique of economic planning and demand management. In contradiction to the classic economic prediction that competition causes diminishing returns, a complex economy makes increasing returns possible. In this version of economics, Silicon Valley is a complex adaptive system; so is the Internet itself.

Researchers at the Santa Fe Institute, a nonprofit center devoted to the study of complex systems, are currently looking at how such insights can be applied to other aspects of collective human activity, including international relations. This effort may recall the futile struggle of Edward Casaubon to find "the key to all mythologies" in George Eliot's novel Middlemarch. But the attempt is worthwhile, because an understanding of how complex systems function is an essential part of any strategy to anticipate and delay their failure.

Whether the canopy of a rain forest or the trading floor of Wall Street, complex systems share certain characteristics. A small input to such a system can produce huge, often unanticipated changes--what scientists call "the amplifier effect." A vaccine, for example, stimulates the immune system to become resistant to, say, measles or mumps. But administer too large a dose, and the patient dies. Meanwhile, causal relationships are often nonlinear, which means that traditional methods of generalizing through observation (such as trend analysis and sampling) are of little use. Some theorists of complexity would go so far as to say that complex systems are wholly nondeterministic, meaning that it is impossible to make predictions about their future behavior based on existing data.

When things go wrong in a complex system, the scale of disruption is nearly impossible to anticipate. There is no such thing as a typical or average forest fire, for example. To use the jargon of modern physics, a forest before a fire is in a state of "self-organized criticality": it is teetering on the verge of a breakdown, but the size of the breakdown is unknown. Will there be a small fire or a huge one? It is very hard to say: a forest fire twice as large as last year's is roughly four or six or eight times less likely to happen this year. This kind of pattern--known as a "power-law distribution"--is remarkably common in the natural world. It can be seen not just in forest fires but also in earthquakes and epidemics. Some researchers claim that conflicts follow a similar pattern, ranging from local skirmishes to full-scale world wars.

What matters most is that in such systems a relatively minor shock can cause a disproportionate--and sometimes fatal--disruption. As Taleb has argued, by 2007, the global economy had grown to resemble an over-optimized electrical grid. Defaults on subprime mortgages produced a relatively small surge in the United States that tipped the entire world economy into a financial blackout, which, for a moment, threatened to bring about a complete collapse of international trade. But blaming such a crash on a policy of deregulation under U.S. President Ronald Reagan is about as plausible as blaming World War I on the buildup of the German navy under Admiral Alfred von Tirpitz.

EMPIRE STATE OF MIND

REGARDLESS OF whether it is a dictatorship or a democracy, any large-scale political unit is a complex system. Most great empires have a nominal central authority--either a hereditary emperor or an elected president--but in practice the power of any individual ruler is a function of the network of economic, social, and political relations over which he or she presides. As such, empires exhibit many of the characteristics of other complex adaptive systems--including the tendency to move from stability to instability quite suddenly. But this fact is rarely recognized because of the collective addiction to cyclical theories of history.

Perhaps the most famous story of imperial decline is that of ancient Rome. In The History of the Decline and Fall of the Roman Empire, published in six volumes between 1776 and 1788, Edward Gibbon covered more than 1,400 years of history, from 180 to 1590. This was history over the very long run, in which the causes of decline ranged from the personality disorders of individual emperors to the power of the Praetorian Guard and the rise of monotheism. After the death of Marcus Aurelius in 180, civil war became a recurring problem, as aspiring emperors competed for the spoils of supreme power. By the fourth century, barbarian invasions or migrations were well under way and only intensified as the Huns moved west. Meanwhile, the challenge posed by Sassanid Persia to the Eastern Roman Empire was steadily growing.

But what if fourth-century Rome was simply functioning normally as a complex adaptive system, with political strife, barbarian migration, and imperial rivalry all just integral features of late antiquity? Through this lens, Rome's fall was sudden and dramatic--just as one would expect when such a system goes critical. As the Oxford historians Peter Heather and Bryan Ward-Perkins have argued, the final breakdown in the Western Roman Empire began in 406, when Germanic invaders poured across the Rhine into Gaul and then Italy. Rome itself was sacked by the Goths in 410. Co-opted by an enfeebled emperor, the Goths then fought the Vandals for control of Spain, but this merely shifted the problem south. Between 429 and 439, Genseric led the Vandals to victory after victory in North Africa, culminating in the fall of Carthage. Rome lost its southern Mediterranean breadbasket and, along with it, a huge source of tax revenue. Roman soldiers were just barely able to defeat Attila's Huns as they swept west from the Balkans. By 452, the Western Roman Empire had lost all of Britain, most of Spain, the richest provinces of North Africa, and southwestern and southeastern Gaul. Not much was left besides Italy. Basiliscus, brother-in-law of Emperor Leo I, tried and failed to recapture Carthage in 468. Byzantium lived on, but the Western Roman Empire was dead. By 476, Rome was the fiefdom of Odoacer, king of the Goths.

What is most striking about this history is the speed of the Roman Empire's collapse. In just five decades, the population of Rome itself fell by three-quarters. Archaeological evidence from the late fifth century--inferior housing, more primitive pottery, fewer coins, smaller cattle--shows that the benign influence of Rome diminished rapidly in the rest of western Europe. What Ward-Perkins calls "the end of civilization" came within the span of a single generation.

Other great empires have suffered comparably swift collapses. The Ming dynasty in China began in 1368, when the warlord Zhu Yuanzhang renamed himself Emperor Hongwu, the word hongwu meaning "vast military power." For most of the next three centuries, Ming China was the world's most sophisticated civilization by almost any measure. Then, in the mid-seventeenth century, political factionalism, fiscal crisis, famine, and epidemic disease opened the door to rebellion within and incursions from without. In 1636, the Manchu leader Huang Taiji proclaimed the advent of the Qing dynasty. Just eight years later, Beijing, the magnificent Ming capital, fell to the rebel leader Li Zicheng, and the last Ming emperor hanged himself out of shame. The transition from Confucian equipoise to anarchy took little more than a decade.

In much the same way, the Bourbon monarchy in France passed from triumph to terror with astonishing rapidity. French intervention on the side of the colonial rebels against British rule in North America in the 1770s seemed like a good idea at the time--a chance for revenge after Great Britain's victory in the Seven Years' War a decade earlier--but it served to tip French finances into a critical state. In May 1789, the summoning of the Estates-General, France's long-dormant representative assembly, unleashed a political chain reaction that led to a swift collapse of royal legitimacy in France. Only four years later, in January 1793, Louis XVI was decapitated by guillotine.

Although several narrative fallacies suggest that the Hapsburg, Ottoman, and Romanov empires were doomed for decades before World War I, the disintegration of the dynastic land empires of eastern Europe came with equal swiftness. What was impressive, in fact, was how well these ancient empires were able to withstand the test of total war. Their collapse only began with the Bolshevik Revolution of October 1917. A mere five years later, Mehmed VI, the last sultan of the Ottoman Empire, departed Constantinople aboard a British warship. With that, all three dynasties were defunct.

The sun set on the British Empire almost as suddenly. In February 1945, Prime Minister Winston Churchill was at Yalta, dividing up the world with U.S. President Franklin Roosevelt and Soviet Premier Joseph Stalin. As World War II was ending, he was swept from office in the July 1945 general election. Within a decade, the United Kingdom had conceded independence to Bangladesh, Bhutan, Burma, Egypt, Eritrea, India, Iran, Israel, Jordan, Libya, Madagascar, Pakistan, and Sri Lanka. The Suez crisis in 1956 proved that the United Kingdom could not act in defiance of the United States in the Middle East, setting the seal on the end of empire. Although it took until the 1960s for independence to reach sub-Saharan Africa and the remnants of colonial rule east of the Suez, the United Kingdom's age of hegemony was effectively over less than a dozen years after its victories over Germany and Japan.

The most recent and familiar example of precipitous decline is, of course, the collapse of the Soviet Union. With the benefit of hindsight, historians have traced all kinds of rot within the Soviet system back to the Brezhnev era and beyond. Perhaps, as the historian and political scientist Stephen Kotkin has argued, it was only the high oil prices of the 1970s that "averted Armageddon." But this did not seem to be the case at the time. In March 1985, when Mikhail Gorbachev became general secretary of the Soviet Communist Party, the CIA estimated the Soviet economy to be approximately 60 percent the size of the U.S. economy. This estimate is now known to have been wrong, but the Soviet nuclear arsenal was genuinely larger than the U.S. stockpile. And governments in what was then called the Third World, from Vietnam to Nicaragua, had been tilting in the Soviets' favor for most of the previous 20 years. Yet less than five years after Gorbachev took power, the Soviet imperium in central and Eastern Europe had fallen apart, followed by the Soviet Union itself in 1991. If ever an empire fell off a cliff--rather than gently declining--it was the one founded by Lenin.

OVER THE EDGE

IF EMPIRES are complex systems that sooner or later succumb to sudden and catastrophic malfunctions, rather than cycling sedately from Arcadia to Apogee to Armageddon, what are the implications for the United States today? First, debating the stages of decline may be a waste of time--it is a precipitous and unexpected fall that should most concern policymakers and citizens. Second, most imperial falls are associated with fiscal crises. All the above cases were marked by sharp imbalances between revenues and expenditures, as well as difficulties with financing public debt. Alarm bells should therefore be ringing very loudly, indeed, as the United States contemplates a deficit for 2009 of more than $1.4 trillion--about 11.2 percent of GDP, the biggest deficit in 60 years--and another for 2010 that will not be much smaller. Public debt, meanwhile, is set to more than double in the coming decade, from $5.8 trillion in 2008 to $14.3 trillion in 2019. Within the same timeframe, interest payments on that debt are forecast to leap from eight percent of federal revenues to 17 percent.

These numbers are bad, but in the realm of political entities, the role of perception is just as crucial, if not more so. In imperial crises, it is not the material underpinnings of power that really matter but expectations about future power. The fiscal numbers cited above cannot erode U.S. strength on their own, but they can work to weaken a long-assumed faith in the United States' ability to weather any crisis. For now, the world still expects the United States to muddle through, eventually confronting its problems when, as Churchill famously said, all the alternatives have been exhausted. Through this lens, past alarms about the deficit seem overblown, and 2080--when the U.S. debt may reach staggering proportions--seems a long way off, leaving plenty of time to plug the fiscal hole. But one day, a seemingly random piece of bad news--perhaps a negative report by a rating agency--will make the headlines during an otherwise quiet news cycle. Suddenly, it will be not just a few policy wonks who worry about the sustainability of U.S. fiscal policy but also the public at large, not to mention investors abroad. It is this shift that is crucial: a complex adaptive system is in big trouble when its component parts lose faith in its viability.

Over the last three years, the complex system of the global economy flipped from boom to bust--all because a bunch of Americans started to default on their subprime mortgages, thereby blowing huge holes in the business models of thousands of highly leveraged financial institutions. The next phase of the current crisis may begin when the public begins to reassess the credibility of the monetary and fiscal measures that the Obama administration has taken in response. Neither interest rates at zero nor fiscal stimulus can achieve a sustainable recovery if people in the United States and abroad collectively decide, overnight, that such measures will lead to much higher inflation rates or outright default. As Thomas Sargent, an economist who pioneered the idea of rational expectations, demonstrated more than 20 years ago, such decisions are self-fulfilling: it is not the base supply of money that determines inflation but the velocity of its circulation, which in turn is a function of expectations. In the same way, it is not the debt-to-GDP ratio that determines government solvency but the interest rate that investors demand. Bond yields can shoot up if expectations change about future government solvency, intensifying an already bad fiscal crisis by driving up the cost of interest payments on new debt. Just ask Greece--it happened there at the end of last year, plunging the country into fiscal and political crisis.

Finally, a shift in expectations about monetary and fiscal policy could force a reassessment of future U.S. foreign policy. There is a zero-sum game at the heart of the budgetary process: if interest payments consume a rising proportion of tax revenue, military expenditure is the item most likely to be cut because, unlike mandatory entitlements, it is discretionary. A U.S. president who says he will deploy 30,000 additional troops to Afghanistan and then, in 18 months' time, start withdrawing them again already has something of a credibility problem. And what about the United States' other strategic challenges? For the United States' enemies in Iran and Iraq, it must be consoling to know that U.S. fiscal policy today is preprogrammed to reduce the resources available for all overseas military operations in the years ahead.

Defeat in the mountains of the Hindu Kush or on the plains of Mesopotamia has long been a harbinger of imperial fall. It is no coincidence that the Soviet Union withdrew from Afghanistan in the annus mirabilis of 1989. What happened 20 years ago, like the events of the distant fifth century, is a reminder that empires do not in fact appear, rise, reign, decline, and fall according to some recurrent and predictable life cycle. It is historians who retrospectively portray the process of imperial dissolution as slow-acting, with multiple overdetermining causes. Rather, empires behave like all complex adaptive systems. They function in apparent equilibrium for some unknowable period. And then, quite abruptly, they collapse. To return to the terminology of Thomas Cole, the painter of The Course of Empire, the shift from consummation to destruction and then to desolation is not cyclical. It is sudden.

A more appropriate visual representation of the way complex systems collapse may be the old poster, once so popular in thousands of college dorm rooms, of a runaway steam train that has crashed through the wall of a Victorian railway terminus and hit the street below nose first. A defective brake or a sleeping driver can be all it takes to go over the edge of chaos.

~~~~~~~~

By Niall Ferguson

Niall Ferguson is Laurence A. Tisch Professor of History at Harvard University, a Fellow at Jesus College, Oxford, and a Senior Fellow at the Hoover Institution at Stanford University. His most recent book is The Ascent of Money: A Financial History of the World. For an annotated guide to this topic, see "What to Read on American Primacy" at www.foreignaffairs.com/readinglists/american-primacy.

---

The contents of Foreign Affairs are protected by copyright. © 2004 Council on Foreign Relations, Inc., all rights reserved. To request permission to reproduce additional copies of the article(s) you will retrieve, please contact the Permissions and Licensing office of Foreign Affairs

The Course of Empire by Thomas Cole

Via Wikipedia

The Course of Empire is a five-part series of paintings created by Thomas Cole in the years 1833-36.

The first painting, The Savage State, shows the valley from the shore opposite the crag, in the dim light of a dawning stormy day. A hunter clad in skins hastens through the wilderness, pursuing a deer; canoes paddle up the river; on the far shore can be seen a clearing cluster of wigwams around a fire, the nucleus of the city that is to be. The visual references are those of Native American life.

In the second painting, The Arcadian or Pastoral State, the sky has cleared and we are in the fresh morning of a day in spring or early summer. The viewpoint has shifted further down the river, as the crag with the boulder is now on the left-hand side of the painting; a forked peak can be seen in the distance beyond it. Much of the wilderness has given way to settled lands, with plowed fields and lawns visible. Various activities go on in the background: plowing, boat-building, herding sheep, dancing; in the foreground, an old man sketches what may be a geometrical problem with a stick. On a bluff on the near side of the river, a megalithic temple has been built, and smoke (presumably from sacrifices) arises from it. The images reflect an idealized, pre-urban ancient Greece.

The third painting, The Consummation of Empire, shifts the viewpoint to the opposite shore, approximately the site of the clearing in the first painting. It is noontide of a glorious summer day. Both sides of the river valley are now covered in colonnaded marble structures, whose steps run down into the water. The megalithic temple seems to have been transformed into a huge domed structure dominating the river-bank. The mouth of the river is guarded by two pharoses, and ships with lateen sails go out to the sea beyond. A joyous crowd throngs the balconies and terraces as a scarlet-robed king or victorious general crosses a bridge connecting the two sides of the river in a triumphal procession. In the foreground an elaborate fountain gushes. The overall look suggests the height of ancient Rome.

The fourth painting, The Destruction of Empire, has almost the same point of view as the third, though the artist has stepped back a bit to allow a wider scene of the action, and moved almost to the center of the river. The action is, of course, the sack and destruction of the city, in the course of a tempest seen in the distance. It seems that a fleet of enemy warriors has overthrown the city's defenses, sailed up the river, and is busily firing the city and killing and raping its inhabitants. The bridge across which the triumphal procession had crossed is broken; a makeshift crossing strains under the weight of soldiers and refugees. Columns are broken, fire breaks from the upper floors of a palace on the river bank. In the foreground a statue of some venerable hero stands headless, still striding forward into the uncertain future, reminiscent of the hunter in the first painting. The scene is perhaps suggested by the Vandal sack of Rome in 455. A possible homage to Destruction was seen in the 2004 film Troy, when Achilles (played by Brad Pitt) decapitates a statue atop a hill during the ravishing of a magnificent imperial city.

The fifth painting, Desolation, shows the results, years later. We view the remains of the city in the livid light of a dying day. The landscape has begun to return to wilderness, and no human beings are to be seen; but the remnants of their architecture emerge from beneath a mantle of trees, ivy, and other overgrowth. The broken stumps of the pharoses loom in the background. The arches of the shattered bridge, and the columns of the temple are still visible; a single column looms in the foreground, now a nesting place for birds. The sunrise of the first painting is mirrored here by a moonrise, a pale light reflecting in the ruin-choked river while the standing pillar reflects the last rays of sunset. Sic transit gloria mundi.

Why the Meltdown Should Have Surprised No One - Peter Schiff - Mises Institute

Peter Schiff on the financial meltdown at Mises Institute

Sentences to ponder:

Back then, we borrowed money to make investments, to build infrastructure, to build factories, to build farms, to build a productive economy. We invested the money; we didn't just spend it on stuff.
...
And we became the world's wealthiest economy because we borrowed to produce. What we've done recently is we've borrowed to consume. We didn't produce anything. ... So how can we possibly pay the money back? We didn't acquire any income-producing assets to pay the money back.

And when the world finally lets the dollar collapse — and they will — our purchasing power isn't going to vanish, it's just going to be redistributed. Other currencies are going to rise. And people in other countries, people that are working in factories right now in China, that are producing products and just shipping them abroad and just kind of waving good-bye, all of a sudden, they'll be able to afford them.

The Chinese will be able to turn in their bicycles and buy automobiles because steel will be cheaper, because cars will be cheaper, because the value of their wages will rise because their currency will gain purchasing power.
Depression Book Bundle 20% Off

It's the Americans who are going to be buying the bicycles. Because, all of a sudden, cars will be too expensive for us, gasoline will be too expensive for us, because we'll be bidding with currency of much less value. And that's what's going to happen. And the world is not going to suffer because we don't buy their stuff. They're going to benefit because now there's going to be more stuff for them.

Right now, because the world lends us so much money, there's a capital shortage. Wouldn't the world be better off investing their savings productively in their own countries, rather than just giving their savings to us? Wouldn't they be better off enjoying the fruits of their own labor, rather than laboring while we enjoy the fruits? It's obvious. And it's going to happen.

Google buzz comment box on the Chrome browser.

The Google buzz comment box appears to be misplaced, mis-sized on my Chrome.
It works fine in my Firefox. My immediate guess is that something wrong/conflicting with extensions.
Turning off adthwart on google buzz seems to fix it.
Others also reported same problem. Given that adthwart is one of the most popular extensions on Chrome. It might be a wide spread problem.

safety of silence

I wanted students to leave my classes not just better informed, but more prepared to relinquish the safety of silence, more prepared to speak up, to act against injustice wherever they saw it. This, of course, was a recipe for trouble.
-- Howard Zinn, Historian, (1922-2010), author of A People's History of the United States

Microsoft on iTunes in 2003: 'We were smoked' | Digital Noise: Music and Tech - CNET News

It is heard all over the place that Microsoft cannot innovate any more. Matt Rosoff dug into old emails to find some clues.

Microsoft on iTunes in 2003: 'We were smoked' | Digital Noise: Music and Tech - CNET News

One of the most interesting follow-ups comes from Groklaw, which dug up some e-mails placed into the public record a few years ago during an antitrust case against Microsoft. (These materials have been a treasure trove of interesting and sometimes-embarrassing internal communications, including then-Windows chief Jim Allchin's 2004 admission that he would have bought a Mac over a Windows PC at that time.)
Almost immediately after Apple launched the iTunes Music Store in April 2003, Microsoft Chairman Bill Gates sent an e-mail to a bunch of folks in the Windows Media and MSN groups praising Steve Jobs' ability to get "a better licensing deal than anybody else has gotten for music." He continued, "We need some plan to prove that even though Jobs has us a bit flat-footed again, we move quick, and both match and do stuff better."
Allchin added his opinion in a follow-up e-mail: "We were smoked."

...
Getting back to Dick Brass's criticism of Microsoft, I find it fascinating that top Microsoft executives were aware almost immediately of the threat the iTunes Music Store posed to the whole Windows Media ecosystem, but Microsoft was still unable to stop it. This matches what I've seen time and time again in my last 10 years following the company.
Microsoft has some smart executives who can quickly and correctly assess market changes and opportunities. Often, they come up with a good strategy to capitalize on those changes. But somewhere between strategy and execution, the thread is lost. Windows Media and Zune are most relevant to this blog, but you can see it elsewhere: online advertising, search, and mobile phones, to name three obvious examples.

Let's fast-forward to yesterday, almost immediately after GOOGLE announced BUZZ, Microsoft PR fought back:

“Busy people don't want another social network, what they want is the convenience of aggregation. We've done that. Hotmail customers have benefitted from Microsoft working with Flickr, Facebook, Twitter and 75 other partners since 2008.” - Microsoft statement on Google Buzz.

Will we read some emails expressing different feelings years later?

How to Succeed in the Age of Going Solo - WSJ.com

WSJ published a nice essay of going solo. How to Succeed in the Age of Going Solo - WSJ.com

So, what do these thriving solo artists have in common? What is the recipe for their good fortune? My research points to five ingredients to keep in mind.

Think Long Term

Pick Right Skills and Keep Them Fresh
Typically, consultants keep their edge by attending workshops or training courses. But the most successful often add another key element to their training: They teach—whether at a regional business college, through university continuing-education programs or through workshops given by professional associations.

Join a Network

Have Your Own Space

Think Like an Entrepreneur

bing still behind google

I just published a post about the recent essay titled " The end of the Beijing Consensus".

I first got to know the essay from a twit this morning. I googled "end of beijing concensus", without the quote, and easily located the essay at the original website, a Chinese translation, and several insightful comments. 10 hours later, just before I publish this blog, I binged again, the same phase, with and without title, the only relevant entry led me to the magazine's main page, not the essay.

Clearly Bing crawls the web much slower than google does. It is age of real-time search now. That should not be too hard to solve. Microsoft can what they are good at, throwing money at the problem. But they did not. Instead, Microsoft spends tons of dollars on TV commercials, and is sitting on a pile of cash.

Bing still has a long way to go to catch up, and it may never happen. Microsoft just becomes more and more irrelevant. They lost the ability to innovate.

The End of the Beijing Consensus | Foreign Affairs

The essay is worth noting not only because of its content, but also that the author is close to the current Chinese administration. The fact that such an essay made its way to Foreign Affairs may imply some internal tensions within CCP.

The End of the Beijing Consensus | Foreign Affairs

Those measures, however, may be too weak to discourage the emergence of powerful interest groups seeking to influence the government. Although private businesses have long recognized the importance of cultivating the government for larger profits, they are not alone. The government itself, its cronies, and state-controlled enterprises are quickly forming strong and exclusive interest groups. In a sense, local governments in China behave like corporations: unlike in advanced democracies, where one of the key mandates of the government is to redistribute income to improve the average citizen's welfare, local governments in China simply pursue economic gain.
...
The reforms carried out over the last 30 years have mostly been responses to imminent crises. Popular resistance and economic imbalances are now moving China toward another major crisis. Strong and privileged interest groups and commercialized local governments are blocking equal distribution of the benefits of economic growth throughout society, thereby rendering futile the CCP's strategy of trading economic growth for people's consent to its absolute rule.
An open and inclusive political process has generally checked the power of interest groups in advanced democracies such as the United States. Indeed, this is precisely the mandate of a disinterested government -- to balance the demands of different social groups. A more open Chinese government could still remain disinterested if the right democratic institutions were put in place to keep the most powerful groups at bay. But ultimately, there is no alternative to greater democratization if the CCP wishes to encourage economic growth and maintain social stability.

The main thesis is thought provoking, and worth further exploring. The narrative is familiar, though. The central government is the good "cop", and the local governments act only in self-interest and ruined the well intended policy. It still leaves people wonder how to explain those policies clearly favored the interests of members of central government.

Mr. President, the Moon is too far

When then Senator Obama responded to the accusation of raising the "false hopes" from his rival, he said:

“How have we made progress in this country? Look, did John F. Kennedy look at the moon and say ‘Ah, it’s too far. We can’t do that. We need a reality check,’”   (source: Politico)

Seemingly, after the reality check, President Obama deemed that the moon is too far. 

It is probably a right decision, which is more upsetting the decision itself. GOP members still cherish the "The Shining City Upon A Hill" speech by Reagan, but the reality keeps reminding people of the possibility that the United States of America can no longer afford to be the leader of the world. For a nation, the dividends of being a world leader is huge, but at times cost might be even higher and unaffordable. It happened to older empires, Rome or Spain.

Is the moon too far? The money needed to keep the mission alive is several billion dollars per year. Considering the money handed out to bankers, and the number of executives collected more than a billion in the recession years, it is not a big amount. So the question is when it comes to spending, what are the priorities. The answer changes the direction of the nation.

iPad ?

I agree with MG Siegler about the market of iPad

Most people won’t yet, but as long as Apple has its base that will buy and use the iPad, they have plenty of time for either themselves or third-party developers to create the killer uses that make the iPad a must-have product for a broader range of people. We already saw that happen with the App Store and the iPhone/iPod touch.

Many people are not convinced yet, me included. I remember I was even more disappointed when iPhone was launched. It did not have 3G, it did not have GPS, it did not have multi-tasking, it did not have stylus, and on and on. All those things iPhone lacked, some still lacking today, do not seem to matter that much as it seemed. It is more about user experience. People don't like it can find tons of reasons to denounce it as sub-par product. Users are typically satisfied with their experience. Those features lacking, some of them are purely business decision instead of technical ones. As for Flash, we may see websites dump Flash and support HTML 5 much sooner. They will have to optimize the website for handsets anyway. That may be Apple's game plan from the beginning. Apple also has Google on its side on this front.

The App market revolutionized the mobile computing. Will the iBook do the same thing to the print media industry? Only time can tell. Steve Jobs claimed he was at the intersection of technology and liberal arts. There may be true. He is also at the intersection of two powerful trends: the uprising of mobile computing and a print media industry desperately looking for new business model.

Kindle won't be the answer. It is dedicated e-reader only. It has its own niche market, and that is it. It was never meant to be a revolutionary product. Windows 7 based tablet might be. Given the Microsoft's track records, I won't bet on it. As someone pointed out, Windows 7 is trying to be king of every kingdom on the earth, but it cannot. Nothing can. Microsoft does not have the control over user experience as Apple has with their close system. The MS partners? They don't have a good track record either. HP, Dell or lenovo, you name it. They are not famous for their sleek design or revolutionary products. They produce lame but (once) profitable machines people use but don't love. Android and Chrome OS will also attack the Windows 7. Again, GOOGLE proved that it is not hardware savvy company.

Given the fact there is no real competitors in this category, the iPad can do at least O.K. for a while, and give Steve Jobs some time to refine it. Or, come up with "one more thing."

Op-Ed Columnist - Is China an Enron? (Part 2) - NYTimes.com

Op-Ed Columnist - Is China an Enron? (Part 2) - NYTimes.com

Friedman at NYT, produced another great line media like to quote:

If China forces out Google, I’d like to short the Chinese Communist Party.

There is little in the analysis, what is remarkable is the shift of stand. I am not convinced it was triggered solely by the GOOGLE incident. Something bigger is happening under the table?

Google China May Be Shut Down: Bad for Android, Good for Apple? | Technomix | Fast Company

Google China May Be Shut Down: Bad for Android, Good for Apple? | Technomix | Fast Company

Meanwhile there may be one very unexpected techno casualty of a Google China shut down: Android OS. Android has seemed to be making headway in the country, with devices like Lenovo's OPhone, the HTC Magic, and Dell's Mini 3 device on sale. But if Google pulls out, it might hurt how well future Android devices do: Though the OS is effectively an open and free platform, Google's support is essential to pushing its development in the future--and why would Google push next-gen high-tech Android phones like the Nexus One in China if it's so opposed to the way China's government forces it to run its business? The move could even result in a further splintering of Android into China and everywhere-else versions. Would this move then shine more of a spotlight on Apple...which recently introduced a special China-friendly version of the iPhone a, is happy to comply with Chinese restrictions, and has numerous business interests in the country? It's extremely difficult to tell, but it would seem more likely than not.

To make the situation even more interesting, Li Huidi, son of Li Changchun, standing committee of Politburo of China Communists Party’s Central Committee in charge of propaganda, recently became vice-president of China Mobile Group. His job responsibilities include the new TD 3G network. It was planned to promote the android powered devices as Chinese copy-righted smart phones on the platform.

On Jan 13, 2010, China Mobile formally announced at the “Annual Work Meeting of China Mobile, 2010″ , that Li Huidi had been appointed VP of the Group, in charge of TD Network building and sales.

His name Li Huidi /李慧镝 soon became filtered by Baidu and google.cn after the move. Will the standoff end the cooperation between China Mobile and GOOGLE once the VP's name becomes unfiltered?

Update: As of Jan 14, 2010 goolge.cn filters results "according to local laws and regulations". This is a step back from the public blog.

Sentence to ponder

Via The Oil Drum | Chinese Transportation Growth

Oversimplifying greatly, it's as though the US borrowed a pile of money from China in order to fight a war to free up oil supply in Iraq in order that China could become the greatest industrial power the world has ever seen.

demo@virushuo: Google百度和谷歌的那些事

转载

demo@virushuo: Google百度和谷歌的那些事: "Google百度和谷歌的那些事
作者：virushuo 发表于 2010-01-14 22:01 最后更新于 2010-01-15 00:01
版权声明：可以任意转载，转载时请务必以超链接形式标明文章原始出处和作者信息及本声明。
http://blog.devep.net/virushuo/2010/01/14/blog56google_blogtinyfool_1_go.html

很久不在这个blog上写和技术无关的东西了，尤其不想写跟业界有关的东西，觉得太空，太忽悠，对别人没价值。但这次，我想写写这5，6年对google和百度的一些观察心得。这里面，这里面存在大量的个人推论，我并不能担保完全正确，请只当作是一次思想的碰撞。

这篇blog主要由我完成，Tinyfool提出了大量修改意见，亦有重要贡献。

1 google，不作恶，信息流动

众所周知，google的目标是'整合全球信息'。从另外一个角度看来，这可以看作加快信息流动。信息流动变快是有巨大的经济价值的。加速，始终是人类经济活动的主线，快即是价值。从蒸汽时代到现在，每一次让移动速度加快的方式都造成了人类巨大的变化，只不过，在蒸汽和机械的时代，加快的是人和货物的移动，信息时代加快的是信息的流动。

仔细观察，可以发现，很多事情不再需要实体物质的流动。比如，我们不再需要人去送一封信，而只需传递一封电子邮件。我们也不那么需要去订阅一份报纸送上家门，而只需要浏览门户网站。这是信息时代带来的改变。而Google所做的，是继续加快这种信息流动的速度，让人们需要的东西更快的呈现在眼前。

Google始终坚持Pagerank排名，除了惩罚作弊者，并未干预过任何排名。这是因为，信息的正常流动才会加速，加速信息是Google的价值，也带来巨大的经济价值。Google绝对不允许把广告插入到搜索结果中。否则搜索结果质量会下降->用户不满意->搜索量降低->广告点击降低，最终仍然造成收入下降。（后面我们会讲到百度完全不同的做法）

投放过Adwords的同学会发现，并非价格越高越好，就算单价非常高，如果匹配度很低，广告点击率就会很低。这样Google仍然会降低这种匹配的出现频率。这样就避免了在A在B的搜索结果中投放'我是B'的广告来误导用户。

在这个体系下，有用的东西就是有用的，信息流动会变快，Google会推动这种信息变的更快，没用的东西就是垃圾，会阻碍信息流动，Google就让他变的更慢，直到被放弃。

Don't be evil 这句口号，可以理解为东欧出生的布林对人生的追求，也可以理解为Google商业利益的准则。因为，越是不作恶，越是让信息有序，正常的流动，给Google带来的实际利益也就越大。很多人认为这只是一句作秀的口号，事实上这是商业和个人追求的双重准则。


2 baidu，竞价排名，Google

百度显然看到了搜索的巨大价值，于是挤进了这个市场。我们且不论搜索质量，先看百度的利润来源。

百度同样有右侧广告(类似Adsense)和左侧排名。左侧排名就是所谓的竞价排名，这是百度的'创新'。竞价排名是百度收入的主要来源(注1)。

前面说过，竞价排名会干扰用户搜索体验，这大家都深有体验，某些热门关键词，百度前几页的结果都是竞价结果。那么为什么Google不敢这样做，而百度这样做就赚翻了呢？

昨天我在twitter上说过一句话：'adsense是促使信息有序流动并盈利，竞价排名是破坏信息流动并盈利。也难怪两个公司的人看问题截然不同。'

很多人有体验，如果你的搜索结果比较靠前，百度会有销售来找你做竞价排名，如果不做的话，很快你的搜索结果就骤减。这种'巧合'正好说明了阻碍信息流动也是可以盈利的。换言之，帮助别人照看孩子可以赚钱，威胁别人家孩子来收保护费也可以赚钱。

那么，按照前面的说法，阻碍信息流动的应该会被用户抛弃，在百度这边为什么情况相反呢？

搜索引擎的结果好坏实际很难评价，通常来说，'好10%'是完全没有意义的。这在这个市场上反复被证实，仅仅让搜索结果比对方好10%，或差10%，不会对用户体验影响太大。第二梯队中的搜狗，有道，搜索结果未必真的比百度差多少，但无论如何也无法翻身。同样的竞争也发生在了Google,Bing,Yahoo之间。换言之，搜索引擎产品是一种先入为主的产品。

在百度起家的年代，Google遭遇了最严重的屏蔽。大家应该都有体验，在大公司内基本无法正常访问Google。我们且不去讨论这种屏蔽的始作俑者是否是百度(无论百度是否加快了这种行为，最终的结果也必然发生)。那几年，又正好是中国互联网用户增长最快的年代(注2)。大量的新互联网用户直接成为了百度的用户。

搜索引擎市场上，'获得第一批用户'是至关重要的。

比较百度和Google的产品和收购策略，百度通常收购能带来巨大流量的产品，包括hao123，天空软件站等等。而Google收购的通常是具有独特的技术，可产生独特数据的产品，比如Analytics,blogger。

百度的主要企业运营行为是围绕'获得第一批用户'的。这些方法包括：工具条，hao123，和软件下载站合作等等。Google被屏蔽看作这种行为的反向手法，无论是否百度造就的，至少这个结果导致了百度获得了更多的第一批用户。

在一个基本没有竞争对手的市场上，百度可以'挟流量以令诸侯'，这时候，他破坏一部分信息正常流动也不会造成太严重的后果。因为用户毫无比较。

Google的铁杆用户分为两类。一类是早期用户，这部分用户用过Google，也用过百度。有明确的比较和鉴别能力。他们最终选择了Google。另外一类是专业用户，他们真的发现百度找不到他们需要的东西。这时候Google对比百度的优势大大增加，到达了用户满意程度的临界点，于是这部分用户也选择了Google。

在中国互联网上，大部分用户偏重娱乐。这些用户很难分辨Google和百度的区别。甚至他们会觉得百度更好一些，因为百度提供了方便无比的MP3搜索。他们一旦先尝试了百度，那么就会留下，继续成为百度的用户。这就是我们今天看到的样子。


3 谷歌做了什么

2006年，Google决定开设中国办公室，并命名为谷歌。这是Google创始以来，最大胆，也是最小心的尝试。他们从来没有过试图进入一个需要过滤某些内容的国家(如前所述，这是阻碍信息流动，同时也背叛了Google的价值观)。

我们可以从一些细节看到Google的小心翼翼。比如，Google.cn是没有Google Account的。用户不能注册，也就没有密码，因此也就没有泄密之忧。后来有人嘲笑谷歌音乐可以用各种帐号登录，但就是不能用Google Account登录。所有需要登录的Google服务都没有进入中国。包括Gmail,Gtalk,Blogger等等等。

Google从进入中国那一天，就给自己设置好了底限。这种底限，就是李开复所说的'总部压力'。

李开复的谷歌，是谷歌，绝不是Google。是一个像百度的外企。

3个字可以来概括谷歌几年的工作：'倒流量'。倒流量的工作由一系列的合作(迅雷，sina，天涯，265)完成。这和Google的传统做法完全不同，Google几乎不去主动谋求流量，产品质量会解决所有问题。但谷歌必须谋求流量，一个急进，喜欢去大学讲座和写书的职业经理人，不会有创始人那样的耐心慢慢的守着一个市场。这让谷歌越来越像百度。

众所周知，用和对手一样的手段不可能打倒对手。

谷歌推出的最重量级产品，是谷歌音乐。这显然是看到了百度在MP3搜索上获得的好处，意图获得以娱乐为主的用户。当然，鉴于Google全球的品牌，这些音乐需要有版权。我不评价这个产品的好坏，但这显然和Google总部习惯格格不入。难道Google不知道去做一个音乐下载产品吗？难道Google不能去做一个下载站吗？总部不去做，只不过是因为这和价值观不符。

同样的价值观不符，还包括和天涯合作的来吧。之前说过，除了独特的数据，Google不会主动创造内容。以Google的胸怀，可以去索引百度贴吧和知道，并放在结果的显著位置，但没必要自己去模仿一个贴吧出来。这种竞争的水平太低了。

甚至，谷歌把中国访问Google.com的流量'劫持'到了Google.cn，以便提高自己的'占有率'。这件事让很多Google老用户恼火，Zola曾经在某个李开复参与的活动中举手提问，如何才能在中国正常的访问Google.com。

'倒流量'之后，谷歌的市场占有率有所上升。这是应该的。不过，新上升的占有率中，有多少是真正的搜索流量就不得而知了。正如百度搜索和贴吧等产品的比值是个秘密一样。

百度跟在Google后面，而谷歌跟在百度后面。

除了倒流量，谷歌也在'抓收入'。

投放过Adsense的朋友，大概会记得，Adsense的匹配质量越来越差，医疗方面的内容也越来越多。之前经常有人因为作弊被封掉帐号，后来再也没人说过自己的帐号被封。

我07年的两篇blog提到了这件事：
对不起，这是谷歌，不是google
去掉了blog上的google adsense

这两个特点都不是Google Adsense应有的特性。Google Adsense应该是匹配准，不干扰用户，且提供有用信息。时常读英文内容的人会时常看到Adsense广告的匹配相当精确，时而有点击的必要。

离开了这两个特点，可以把谷歌的广告看作一个大的广告联盟。这和拿了很多小网站的Banner的流量去找广告主谈价本质是一样的。在这种广告销售策略下，不需要匹配，不需要杜绝点击欺诈。最舍得花钱投这种广告的，无非是医疗，美容几类。

这几类是最赚钱的部分。不仅对于谷歌，对于百度，甚至对电视台都是一样的。

关于Adsense的故事，可以看看Tiny这篇文章 :我和Google Adsense那点故事

在这5年中，最常被记者们提起的'谷歌困境'就是'总部压力'。在我列出的这些部分，都已经触及到了Google价值观，所以Google必然不满。

有兴趣的同学可以对比一下2005~2010这5年，Google做了什么，谷歌做了什么。你会看到截然不同的项目。虽然结果看起来似乎都是：'市场份额增加，收入增加'，Google在这几年，砸实了搜索的基础，扩大了搜索的内容来源和范围，把索引伸向了非数字内容，完成了地图/卫星图/Earth/街景等一系列重要产品，完成了在移动和3G方面的布局。谷歌做了什么呢？音乐，热榜，还有一个抄袭的输入法。

从谷歌存在的那天，我就写过一篇文章，核心意思是：要么把中国当作研发基地，投资，研发，但不运营，要么就干脆去印度开分公司。不幸言中。

4 孙云丰的观点

从商业价值和经济利益方面考量，都可以看出Google的不作恶，并不是作秀的口号。对于一个靠信息有序化赚钱的公司，必须要不作恶才行。百度正好相反，必须要作恶才行。

Google是幸福的，可以把商业价值建立在一个正确的价值观之上。这确实是可遇不可求的机会。很不幸，百度不行。

孙云丰的言论是无法自圆其说的。一方面，他认为Google不是人权斗士，只是个为了利润的市侩分子。另一方面，他又高举社会公平的大旗，宣称百度的道德感。这两者之间有明确的冲突。如果Google只为了利润，那么百度同样不应该有道德可言。

一方面，他宣称自己观点毫无错误，另一方面，他又删掉了自己的文章。有人说删贴未必是他自己的意愿。那么，作为宣称'有道德感'的百度员工，他不应该屈从别人的意见删掉自己认为正确的东西。作为百度高管，不应该允许百度公关去打电话要求别人删贴。

今天有一些百度员工为孙云丰辩护，这些说法同样无法自圆其说。试图证明百度是一家很好的公司，并不能证明孙云丰说的正确。正如纳粹德国有一支很有战斗力的军队，并不能证明希特勒是正义的。他们甚至自相矛盾，认为孙云丰对竞争对手恶言相对是正确的，其他人骂孙云丰是错。如果孙云丰代表自己骂了一家公司，该公司的用户有权回击。如果孙云丰代表百度，那他严重的缺乏职业道德。从任何角度，我也得不出百度员工和前员工的那些结论。

当然，我从来也没认为过百度是一家很糟糕的公司，甚至很多次认为百度正在逐渐变成一家有责任感的公司。遗憾的是，从高管到员工，似乎都没和这家公司一样完成这种转变。

不要以为这次事件打击了Google在中国的份额就幸灾乐祸，事实上，中国的互联网市场消失了。这和市场份额无关，和宏观形势有关。这个国家温情脉脉的互联网时代就此结束，就好比IT精英们看不起的那些传统生意人一样，慢慢被兼并，重组，消亡，剩下的那一点，会被扫倒利润微薄的边边角角。就好比，你家楼下菜市场那个可怜的菜农，守着那一点点收入，还要担心城管。这是这个行业中每个人的悲剧。

Tinyfool说:百度的矛盾在于，Google的成功是他在全世界资本市场受宠的原因，但他们可能无时无刻不想google死掉会更好。在全世界范围内，这是不可能出现的，现在在中国出现了，他们真的会高兴吗？

Google给我们的最大价值，除了信息流动加速，就是信息永存。当我写完这篇blog，发布在我的blog上，按下'发布'之后的几分钟，各种蜘蛛就会蜂拥而至，把这篇文章复制若干次，存在这世界的各个角落。这文章即永存。无法被某个组织控制或删除，也无法阻止其流动。公关公司不行，某个国家政府也不行。孙云丰的言论，和百度其他员工的言论，也将和这篇文章一样，被永存，成为历史的一部分。这是我们热爱Google的原因。

现在，我要按下发布按钮了。"