1 After 18 years, US oil production exceeds imports (BBC) US domestic crude oil production has exceeded oil imports for the first time since 1995, according to the Energy Information Administration. The EIA said petroleum imports were at their lowest since 1991, partially due to surging domestic oil production from hydraulic fracturing, or fracking. In October, US crude oil output averaged at 7.7 million barrels per day (bpd). The EIA says it expects output to exceed 8.8 million bpd by 2014.
The domestic oil boom has been due mostly to fracking, a new technique used to get oil from shale deposits in locations like North Dakota and Texas. The technology has come under fire by critics concerned about the environmental impacts of the procedure. The EIA says imports now make up 40% of US oil consumption – significantly less than the 60% peak reached in 2005.
The organisation forecasts imports will make up only 28% of US oil consumption in 2014, which would be the lowest level since 1985. In a statement, the White House welcomed the news, saying it is an example of how the administration’s energy policies are working.
2 Asian tigers and paper tigers (Maleeha Lodhi in Khaleej Times) An important new book, How Asia Works by Joe Studwell explains why some countries have become economic tigers in East Asia while others are relative failures or paper tigers. The book challenges key tenets of the so-called Washington consensus, which prescribes free market solutions for all economies regardless of their level of development. Studwell establishes that a nation’s development destiny is shaped most decisively by government action.
Studwell presents his case unambiguously, backing it by evidence. “No significant economy has developed successfully through policies of free trade and deregulation from the get-go.” “Proactive interventions” have been essential in all cases of economic transformation as they fostered early accumulation of capital and technological learning. While Northeast Asian states achieved extraordinary progress and prosperity, Southeast Asian nations lagged behind, in part because they took poor advice from multilateral financial institutions and failed to heed the lessons of history.
The book also draws a distinction between the ‘economics of development’ and the ‘economics of efficiency’. The first is like an education process where poor nations, lacking technological capacity and adequate human capital, acquire the skills necessary to compete globally. This requires investible funds, which in turn needs state intervention, “nurturing and protection as well as competition”. However at a later stage of development, countries have to transition to the ‘economics of efficiency’ to achieve profitability. This requires less state intervention, more deregulation and freer markets. From this emerges the author’s central argument that economic development is a “stages game” with different policy solutions suited for different phases of development.
Finally the author emphasises that these interventions take countries only to a certain development stage. Over time, these policies create problems and have to change as countries transition to the next phase, when the ‘economics of efficiency’ has to kick in.
3 Snapchat expects billions (Jenna Wortham in The New York Times) What business makes no money, has yet to pass its third anniversary and just turned down an offer worth billions of dollars? Snapchat, a social media service run by a pair of 20-somethings who until last month worked out of a beachfront bungalow in Venice, Calif. Thanks to today’s rabid rat race for the hottest social media start-ups, Snapchat has joined the list of tech companies — like Tumblr and Instagram — with no money coming in but multiple sky-high takeover offers.
So far, Snapchat’s leaders have balked at the offers, according to three people with knowledge of the overtures, including a recent multibillion-dollar proposal from Facebook, the biggest social network of them all. It’s not that they don’t want billions of dollars. In part, it’s because they think making a deal now would leave many billions more on the table.
The service, started in 2011 by Evan Spiegel, 23, and Bobby Murphy, 25, two former Stanford fraternity brothers, lets users send photo and video messages that disappear after they are viewed. Snapchat quickly gained a reputation as an easy way to send sexually suggestive photos, but it also picked up steam as a fun and easy way to trade photo messages.
4 Tales Indian politicians like telling (Pratap Bhanu Mehta in The New York Times) In May, Indians will vote on their future. Yet the political elite seems stuck talking about the past. On one side is Narendra Modi, chief minister of the state of Gujarat, the face of the opposition Bharatiya Janata Party and the most contentious figure in Indian politics today. A son of grocers, he blames nepotism and corruption in the governing Congress Party for persistent inflation and a slowdown in economic growth.
On the other side is the Congress Party, which has ruled India for most of its history since independence in 1947. The Congress Party contrasts its tradition of inclusion — it is led by Sonia Gandhi, the Italian-born widow of the assassinated prime minister Rajiv Gandhi, and it appointed a Sikh, Manmohan Singh, as prime minister in 2004 — with the BJP’s Hindu nationalism. But the limits of the Congress Party’s strategy are apparent. Mainstream voters have begun to resent the way it seems to invoke secularism like a trump card, or even a kind of political blackmail.
The main problem is that despite being in power for the better part of 60 years, the Congress Party has not managed to make its vision of inclusive nationalism a meaningful reality for most people. The criminal justice system in India is broken: Police agencies and prosecutors’ offices are extensions of the executive branch, which means that they are vulnerable to politicization. Yet the Congress Party has not created institutions, agencies or practices to insulate officials from improper influence.
Having failed to implement its lofty principles about inclusiveness, the Congress can no longer claim the moral high ground. Yet it continues to take refuge in abstract ideological formulations rather than setting out a plan to fix political institutions. Congress’s failures have made it seem less risky to back the BJP. Meanwhile, the BJ.P — whose credentials on secularism remain suspect — has tried to downplay its Hindu nationalist roots by claiming the mantle of Vallabhbhai Patel, a major figure in India’s independence and the deputy prime minister under Jawaharlal Nehru (the father of Indira Gandhi).
It may seem like an odd choice, given that Mr. Patel was, like Nehru, a stalwart of the Congress Party. But in advancing a story line that claims Patel would have been a better prime minister than Nehru, the BJP is attacking some of the Congress Party’s founding myths. Despite massive social change and a yearning for strong but fair economic growth, neither party is articulating a discourse suited to the times. Both still prefer to conjure up a counterfeit history than propose a coherent vision of the future.
5 ‘Poshtels’: When hostels go upscale (Jeanne Cooper in San Francisco Chronicle) Even those who speak the Queen’s English are not exempt from travel industry portmanteau (“staycation,” “babymoon,” etc.), judging by the latest news from VisitEngland, aka the English Tourist Board. Apparently “glamping” (upscale camping) has a new rival for budget travelers: the “poshtel,” or posh hostel.
YHA, which operates 200 hostels in England and Wales, has recently poured more than 10 million pounds (about $16 million) over the last two years into upgrades at various facilities, creating private rooms with their own bathrooms or, in the case of Wilderhope Manor in Shropshire and Grinton Lodge in the Yorkshire Dales, designing bridal suites with roll-top bathtubs and four-poster beds. In general, rooms at YHA hostels start at start at 20 pounds (about $32) a night and beds at 10 pounds ($16).
The flagship hostel of another independent chain, Safestay Hostel in London’s Elephant & Castle, recently earned four stars in VisitEngland’s accommodation quality assurance scheme. The 74-room, 407-bed hostel that opened in 2012 in an 18th century Georgian building, formerly the Labour Political Party Headquarters, with amenities that include private twin rooms and family rooms with 40-inch plasma TVs, bar, game room and walled garden. Dorm rooms start at 18 pounds (about $29) per person and private two-bunk rooms at 58 pounds ($93) per night.