It's easy to stimulate consumption

All the government needs to do is to spread rumour that the world is going to end soon. People who believe it will spend as if there is no tomorrow.

----------------------

Governments often talk about stimulating consumption in the economy. All the government has to do to encourage spending is to spread rumour that the world is going to end soon. Not everybody buys every rumours, but those who believe in this roomer will start spending as if there is no tomorrow.

To ensure that not everybody spends at the same time, the government can spread one rumour saying that the world is going to end within the next 12 months, and another that says the world will end in 24 months time.

Expectations play an important part in economics. Businesses and politicians fabricating expectations all the time. So spreading rumours is certainly within their scope of acceptable practices.

[End]

Green (and Healthy) Transportation in China

Advocated from 1982; last updated 2011.02.18

China roads were dominated by bicycles in the 70's. As cars replace bicycles, traffic congestion becomes the norm. Cars pollute, and congestions may become intolerable in big cities. China could have implemented the greenest transportation: to build roll-on roll-off undergrounds and trains for bicycles. All short distance travel will be covered by bicycles, long distance by trains.

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“There are nine million bicycles in Beijing”:

“There are nine million bicycles in Beijing”, sang Katie Melua. I won’t take the number “nine million” too seriously. After all, Katie has been challenged by Simon Singh (for a bit of fun) on her lyric “we are twelve billion light years from the edge”. What is a fact is that there are many, many bicycles in China. Tiananmen was full of bicycles when I visited it in 1979. The same applies to Shanghai and Kwangtung around the same time.

Can one drive in 10 years' time?

Now these cities are full of cars. It is already pretty difficult to travel by car in Beijing now. It will be unimaginable when car ownership reach the same level as the US or Western Europe. Can one still drive by then? What are the solutions? If they have any solutions, the West would want to know. Many say that M25 is the biggest car park in UK.

Potential solution: bicycles on underground and trains:

As China develops, these big cities needed to build undergrounds. They have missed the opportunity to implement the greenest transportation. They could have built undergrounds that specialise in taking bicycles. The undergrounds should be designed in such a way that cyclists could ride into the underground, and push their bikes onto trains specially built to carry bikes. This way, all short distance travelling will be covered by bicycles, and long distances by trains. The system will be efficient, green and healthy to the users. Similarly, trains should be designed for roll-on, roll-off by bicycles. That way, China will have a green transportation. It will probably have a healthier population (helped by cycling exercises).

Better late than never:

I’ve advocated this publicly since the 1980’s, when China started to develop. Many big cities have missed their opportunities. But it is better late than never. Some cities have yet to build their undergrounds. The question is whether they have the determination to implement green transportation. Against them are car manufacturers, who would lobby the government to build more roads instead.

[End]

Simplify and then Exaggerate

One of the commonly used technique by governments and in journalism is “simply and then exaggerate”. Simplification is necessary in daily life. Exaggeration is useful for catching attention. Unfortunately, some people use it to create misunderstanding and incite hatred, which is dangerous and irresponsible.

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We all simplify

We all simplify. That’s the only way to handle the complex world.

Both “nuclear power is clean” and “nuclear power is dangerous” are simplifying statements. How many people can fully evaluate the many aspects of nuclear power? When one does, what one tells the world will be ignored, because it doesn’t make headlines, and it is too complicated to be understood. That’s why analyses are reduced to simple statements such as the above two.

Dangerous simplification


Simplification and then exaggeration is commonly used in journalism. One example is on immigration matters. Some newspapers promote the simplified and exaggerated views “immigrants get all the jobs”, “immigrants weaken this country by consuming a lot of its resources", "immigrants come to take advantage of our social benefits”. The editors know that these are simplified views. They also know that they have exaggerated these views. They have conveniently ignored the fact that many immigrants are professionals and experts that contribute to the society. The hospitals wouldn't run without foreign doctors and nurses. Universities won't run without overseas scholars.


Simplification is perhaps essential


The above are not an isolated examples. They reflect the general picture. Individuals and societies simplify everything. Simplifying allows others to understand.


Even if one has the sophistication to understand the full picture, one does not necessarily have the time to do so. Given the lack of time, one has to choose between forming a simplified view and not forming a view at all. I would not say whether simple view or no view is better. I suspect that most people will naturally choose the former.


Exaggeration could be irresponsible


Exaggeration allows the message to catch attention and get message across. It is commonly used in daily life. It is often used in humour. Exaggeration is used to by journalists to sell newspapers, by government officials to get elected and promote policies, by companies to promote products. Having private goals is understandable. Achieving private goals through irresponsible exaggeration, such as inciting hatred, is unacceptable.


Exaggeration is irresponsible when it is used deliberately to create misunderstanding, hatred and confrontations. Some governments use simplification and exaggeration to incite hatred towards other countries and cultures. Some newspapers use simplification and exaggeration to incite hatred towards immigrants and promote racial confrontation. These acts are rather dangerous. Unfortunately, they work on people when they don’t think deeply.


[End]

Chinese immigrants to Hong Kong, the selected people

Chinese immigrants to Hong Kong in the past were selected people -- selected by nature. They had special qualities that could benefit a society.

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The 1949 Chinese immigrants changed Hong Kong

When the Communist Party took over China in 1949, a large number of people moved to Hong Kong and Taiwan. Among them were entrepreneurs and scholars. They established banks, factories and other businesses in Hong Kong. Before these immigrants arrived, Hong Kong was nothing more than a fishing port. It was not until the late 1960’s, when these immigrants have settled (many of them originally considered Hong Kong as a temporary place to stay), that Hong Kong’s economy started to take off. It is fair to say that Hong Kong would not have developed without the Chinese immigrants in 1949.

The swimmers in 1960's

In the 60's, many people swam to Hong Kong from Mainland China. Many of those people did very well later in life. Some of them exhibit high intelligence, entrepreneurship and social responsibility. One good example is 劉夢熊, a respectable, intelligent man, a successful entrepreneur and one who advocates social responsibility in China.


Special qualities of the swimmers

Those who swam to Hong Kong and arrived had special qualities:

1. They were physically and mentally strong.
2. They were willing to take risks.
3. They demonstrated ability to adapt to new challenges.
4. They were probably good in human relationship -- in those days, there was no social benefit. Many of them had to borrow money from friends and relatives; to succeed, one must be good in interpersonal skills. Besides, they had to build up relationship with new people.

Natural selection is good for a society
Through natural selection, immigration is probably a good thing for a society. This is true as long as they are not attracted by the society’s social benefits, which the society has the means to control. This is especially true for those who risk a lot to make the move.


Possible generalization
The analysis may apply to other societies. The USA has benefited from many successful immigrants. Generalization of the above observation goes beyond the scope of this article.


[End]

Saga at the Hong Kong University

Written on 2011.09.02

Many questions surround Hong Kong University's celebration of its 100 years anniversary. Arrangements and behaviour by the police and the university are questionable. The students are no wiser.

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The Hong Kong University (HKU) celebrated it 100 years anniversary. (1911 happened to be the year when Mr Sun Yat-sin lead a revolution to overturn the Qing dynasty.) The Chinese Deputy Prime Minister Mr Li Keqiang was invited to attend at their top guest.

Many aspects of the HKU’s arrangement are debatable:

• Student Li Sing Hong protested as he was refused to attend the ceremony. He wasn’t the only one, as space is limited. The talking point was: the police treated him with excessive force They locked him up for over an hour without explanation.
• Why was Li given the Chancellor’s seat? In what capacity did he attend the ceremony?
• David Wilson was introduced as the Chancellor of Aberdeen University. Why was he not introduced as an ex-Governor of Hong Kong? Why should the Chancellor of Aberdeen University be invited to attend and speak at the ceremony?

But I have to defend Vice Chancellor Professor Tsui Lap-chee. He was willing to meet the students afterwards. Not many high officials in Hong Kong have the courage to face the public. Professor Tsui apologised to the students for any mis-handling of the matter, and promised to review the procedures. I feel that the students should give him time to do so.

I am not impressed by Li Sing Hong and some other students during their meeting with Professor Tsui. They did not give Professor Tsui respect that he deserves. They may not like what HKU has done, but if they are sincere in a dialogue, then they should treat Professor Tsui with due respect (as anyone should to anyone else). If they are not sincerely looking for a dialogue, then they should not attend the meeting. I would acknowledge their anger, but don't like their act, because that does not lead to solutions.

Updated 2011.10.26
In late October, Professor Tsui decided not to renew his contract with the university. The students have lost a sincere vice chancellor. They get what they asked for, which is not necessarily in their interest.

[End]

China's Vulnerability

A lot of social grievance has been built up and suppressed in China. A small shake-up can spark social unrest. Shake-up may come in the form of an economic adjustment, or even worse, global recession.

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Grievance accumulated

The Chinese society has accumulated a lot of grievance. What have contributed to the build-up of grievance? Corruption and economic inequality may have played a part.

The authority chooses to suppress adverse opinions. Unfortunately, suppression only helps to build the pressure up. It is difficult to estimate the capacity of the grievance-container in China. One would assume that it has a limit.

In a grievance-charged society, a small event can spark off serious social unrest. This is demonstrated by the social unrest triggered by the arrest of Zhao Lianhai(activist for parents of children harmed during the 2008 Chinese milk scandal) and Liu Xiaobo (Nobel Prize winner 2011).

Economic adjustment inevitable

The West is facing economic adjustments. Adjustments happen from time to time. In fact, the situation could be worse: the West could go into recession. When this happens, China will lose markets to export to. This will lead to unemployment in China (which internal market is relatively small compared to its GDP).

Unemployment will start riots, which consequences are unpredictable.

Things that do not help

The society is target-driven and often superficial. It lacks depth. The economy is also over-heated.

Most infrastructure are built to meet targets. Any quality that is not specified as targets is ignored. For example, there are buildings and roads, but little development in drainage. A heavy rain will paralyse traffic. A small deviation in operation led to a fatal train crash in Wenzhou in July.

Solutions are in the hands of the leaders

To handle the situation, China needs powerful, united leaders. They must have vision. They have already attempted to cool down the economy for years. This is a formidable task, given the "can't-fail" metality by the investors. The leaders need to give people channels to release their grievance, in an orderly manner. This operation, should they decide to take it, is very delicate, as one step wrong could trigger riot.

The Primier Wen Jiabao seems to be a sensible man. He talked to individuals in the public, which shows his confidence. How much can he do?

[End]

Willetts could kill British higher education

In June 2011, Universities Minister David Willetts published plans to increase market forces in higher education in England. This sounds like a good idea to people who do not know how higher education and markets work. Unfortunately, this idea is going to kill British higher education. This is because education does not just involve money. Students must also pay with their effort. Market force will drive universities to waive effort and give away cheap degrees.

-----------------------------------

Willetts proposal

Universities Minister David Willetts has published plans to increase market forces in higher education in England (e.g. see BBC news).

This approach may sound sensible at first sight. Empowering students seems to be a good idea. Having universities compete with each other would keep them on their toes. Competition improves efficiency. Let the well-run universities thrive. Let the failed universities close. What's wrong with that?

The proposal is fine for top universities

Unfortunately, there is a fundamental flaw in this analysis. Willetts should see it had he studied the Nash equilibrium under his policy.

If I were an Oxbridge student, then I will choose between Oxford and Cambridge. That is not much of a competition. The two universities will have no problem recruiting, even if they raise fees or cut costs. Top students would still go there because of their reputation. Market force do not apply to them very much.

Universities below Oxbridge will start to feel the pinch. They will have to define their market positions. The lower they are in the ranking, the more they have to worry about survival. That is what Willetts want to achieve with market force.

Students are investors

If I were a student who cannot get into the top universities, I have plenty of choices. Which university should I invest my money on? I have multiple criteria in picking my university. Does it have a good reputation? Is it cheap (fees plus living expenses)? Is it easy to get high scores from it? Does it have a good environment? Do their graduates get employment easily?

The government sends a clear signal that higher education is an investment by me as a student. As an investment, students are led to pay attention to return. With payback in mind, they may not pay as much attention to education.

Cut-throat competition

From a university's point of view, it wants students. Reputation can't be built overnight, building reputation is not cost-free anyway. So if a university struggles to get students, the rational strategy would be to give high scores, better honour degrees. These may cost them in the long run (it may not, as explained later), but they don't cost anything immediately. If jobs are at risk, I know what the market would drive academics to do. Conscience doesn't pay the mortgage, I am afraid. Maintaining academic standard would get the sack, because you are not helping the institute to survive.

Inflating grades and degree classes may not cost a university's reputation. This is true if all universities of they same level of reputation do the same. In a cut-throat competition, I bet they all do. In fact, they would all try to out-do other universities. As a result, the reputation of British degrees will be sent down the drain.

Market force do not reflect student effort

The flaw in Willett's theory is that money is the only commodity in this market as far as the students concerned. In reality, students should pay with their *effort* if they want to get a degrees. Competition, and pressure on universities, takes this factor out of the equation.

Can we put student effort into the equation then? To do so, we have to define the minimum standard of a degree. Students must reach those standards. Unfortunately, it is not easy to define education quality. Besides, universities will always have ways to get round government measures. They will do so if survival is under threat. Lecturers can do the projects for the students, for example, if their jobs are at risk.

Where are we heading?

So where does this policy lead to? The second tier universities will enter cut-throat competitions in order to survive. The reputation of British higher education will go down the drain. The good universities may have no problem recruiting students. But as the overall standard goes down, they are free to lower their standard (e.g. to cut cost) should they want to.

Run as a business, universities will inevitably have life cycles. Under market forces, universities will be set up and closed from time to time. Unfortunately, degrees obtained from a university that has been closed will worth very little. Under Willetts' plan, students (as investors) are therefore going to take on higher risk. This risk is very hard to assess. Perhaps students should be made aware of this.

Just Add Imagination

Imagination sometimes costs nothing to generate. But it can change government, sell products and impact the world in many other ways; it is almost limitless.

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Smart politicians

“New Labour” by Tony Blair, “Change” by Obama and “Big Society” by Cameron are all clever ideas. They are clever because they are vague and subject to interpretation. All the hearers will add their own imagination. Everyone sees what he/she expects to see. Give people a vague picture and they will “fill in the blanks” using imagination. With a little nudge by the leaders, many people willingly see positive things from those vague terms. Some do not. But with these ideas being vague, they can’t do much harm anyway.


Commercial use of imagination

What does Coca Cola tell you in their advertisements? They don't tell you how good Coca Cola tastes. They show you happy faces. It is up to you to associate those happy faces with Coca Cola. Your imagination does all the work for them.

Similar techniques are used in other advertisements, such as cigarettes. They don't tell you how good the products are. They just invoke your imagination.


Imagination is magical!

Imagination doesn’t cost anything. It almost have no limits. If you want it to, it can add values to leadership, commercial products, personal relationship, share prices and many more things in our life. It can also add negative values through fear, hatred, misunderstanding, etc.


[End]

Patriotic Education Proposed in Hong Kong

The Hong Kong Government is planning to introduce patriotic education in primary schools. Are we going back to 1984?

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Moral and National Education

The Hong Kong Government is proposing to introduce a Moral and National Education Curriculum (德育及國民教育科) in primary schools. Chaired by Professor Li Cheuk-Fun (李焯芬教授), a draft has been released for consultation. The objective of this curriculum is to build “national harmony, identity and unity among individuals”. Those who support it argue that patriotic education is common practice in Western education. This proposal has also raised a few eyebrows in the society.


(It is worth noting that this document is pretty poorly written, both in the use of language and in the arguments. Besides, this document is not indexed from the Education Bureau’s home page under “What’s New”. Perhaps it is considered unimportant by the Government? But if it is a consultation document, then shouldn’t it be better publicised?)


Tame action to correct misguided public views

The document suggested that the general public in Hong Kong is often misguided. Part of the objective of this curriculum is to correct the public’s views. If that is the objective, then the action is far too tame. Why teach primary school students only? To tackle this problem head on, the Government should set up a new Ministry of Truth, with the remit to inform the public how the real world looks like.

As China is run by the Communist Party, perhaps Marxism should be included in the curriculum. As religion is an important part of the society, the government should perhaps include in the curriculum clear classification of religions and cults.

This curriculum is compulsory. It is probably natural to make a good grade in this subject a prerequisite for all government posts in the future. That would help to enhance harmony and unity in the government.


Need to address the root of the problem

The trouble is: there are many causes for social unrest. For example, with a Gini coefficient of 5.33 in 2006, Hong Kong ranked 16 from the bottom of all countries in terms of economic inequality. It was below countries like El Salvador, Peru, Papua New Guinea, Zambia, and Zimbabwe, which is not best known for their political stability.

The Government needs to address the root of the causes for social unrest. Pulling a woollen hat over the public’s eyes may work for a while, but patriotic education is by no means a very effective hat if generous moves such as giving away 6,000 Hong Kong dollars per citizen failed to please the public. Hong Kong people are intelligent enough to see through the woollen hats. Perhaps the Government sees exactly that as part of the problem. Perhaps this new curriculum is designed to reduce the intelligence of the next generation. It will only work if the next generation shares the same intelligence as that of the designer of this policy.


[End]

Academic Freedom for Big Society

The Prime Minister, David Cameron promoted the idea of "big society". The Minister for Higher Education, David Willetts intends to spend a significant amount of research council's money to support research on big society. Clearly academics who support the "big society" idea (whatever that is) will succeed; those who don't will die of natural courses (funding dried up). Willetts and Cameron are very clever indeed! However, using academic freedom to pay for a party's political future is downright irresponsible.

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"Big Society": just add imagination

The Government is promoting the concept of "big society". There were no definitions, only examples. This is clever, as different people understand "big society" differently. Promoting something vague is one way to unite people, because they all give it the interpretation that sounds good for them. Let people use their imagination.


Supporting "big society" with research council fundings

The Minister for Higher Education, David Willetts works really hard. After raising the tuition fees (or at least allowing the Chancellor to raise tuition fees), he is suggesting that the Arts and Humanities Research Council (AHRC) will spend a "significant" amount of its funding on big society, according to the Guardian's Observer on 27 March 2011.

Clearly if a grant proposal sounds negative towards the "big society", it won't get funded. Therefore, this is a clever trick by Willetts/Cameron to promote the "big society"idea, using research money.


Survival of the fittest

In fact, this is one way to eliminate academics who do not support the "big society" idea, whatever that is. Academics who do not support the big society idea will not apply for AHRC funding, or put in proposals that are negative about it. By depriving these academics of funding, they would not survive in the education system. Remained in the system will be academics who are willing to follow the Government's lead. Survival of the fittest, really (from Willetts' point of view).

A proven formula, clever trick

This strategy was perhaps copied from the US. In the US, most scientific research funds come out of defence budget.

The best known case of applying this strategy in China was around 206BC. In the Qin Dynasty, the Prime Minister Zhao GAO plotted to usurp the throne. To test which minister was on his side and which was not, he presented a deer to the emperor, and asserted that it was a horse. His men recorded those who disagreed. They were eliminated one by one afterwards.

Clever trick this is. However, using academic freedom to pay for a party's political future is downright irresponsible.


[End]

The toothpaste phenomenon

When resources need to be extracted, the bottom is squeezed first. Despite the reduction of resources, the top part below the outlet bulges. I call this the toothpaste phenomenon.

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Squeeze the bottom first

When resources need to be extracted, there will be squeezes. Whenever there is a squeeze, it is always the people at the bottom that are pinched. When the Government reduces its budget in education, the management decides where to cut. It is always the teacher number that is reduced first. The management team often have to expand to “improve efficiency”. Unfortunately, such efficiency gains typically mean cutting corners. They mean each academic will have more students to teach. As a result, students have reduced attention from academics. The reality is: students do not just pay for the cuts. They also pay for the expansion of the management, which do not actually add to their education.


This phenomenon is seen everywhere


The same applies to hospitals, police and social work. Squeezing from the bottom gives opportunities to managements to change things. The same applies to companies. When the economy cools down, the workers will lose their jobs first, then the smaller companies will collapse. Well connected, big businesses are often the last to be in trouble. (AIG is a good example. It is too big to fail.) The big businesses will always be protected, because “they are there to help recovery”. This is because the Government is supported by big businesses.

The "toothpaste phenomenon"


I call this the toothpaste phenomenon: when resources need to be extracted from a system, one presses the bottom. Then resources will come out from the outlet. But the top part of the toothpaste, which is right below the outlet, will bulge out. It catches all the resources before they are released.

[End]

Vow to share in a wedding

When two people vow to share all their wealth, the implications may not be what they intended. Logically it could mean that they give away one third of their wealth to the other party.

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In a wedding, the bridegroom vowed:

• “I vow to share everything with you.”

The bride vowed the same.
Language is ambiguous, as always, but it is reasonable to assume that the intended meaning to be as follows:

• “I’ll equally share with you everything in my name, including everything that I may receive in the future, until the end of this marriage.”

However, there is a problem with this interpretation. Suppose the bridegroom’s wealth is 1. According to the vow, half of that will go to the bride’s name. But when the bride receives that half, she will have to share half of her proceeds with the bridegroom. When the bridegroom receives that wealth, he will have to give half of that back to the bride. The series is therefore:

1 – ½ + ¼ - 1/8 + 1/16 – 1/32 + ….

This is a series with increment r = –½. Therefore the series should be evaluated to (1/ (1-r)), which is 1/(1-(-½) = 2/3.

In other words, the bridegroom will give one third of his wealth to the bride, and receive one third of the bride’s wealth.

Here is a concrete example:
If the bridegroom has a wealth of £3,000, and the bride has a wealth of £3,000,000, then the intended meaning of the vow is that the couple will each have 1,501,500 to their name after the marriage. But the logical meaning of the vows, according to the above interpretation, is that the husband will have £1,002,000 to his name, and the bride will have £2,001,000 to her name.

I wonder if this argument stands in court.

The vow should be changed if it were to achieve the intended meaning. Both sides must say:

• “I vow to (equally) share everything in my name with you, but not including what you share with me.”

This will break the recursion. But it could be seen to be a bit mean (though it is the opposite), wouldn’t it?


[End]

Corrupted bosses dynamics

Power corrupts. Bosses have power, and therefore they tend to corrupt. To survive, corrupted bosses must either hide their corruption or be ruthless. Most would do both, and legalise corruption.

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Power corrupts

Taking advantage of one's position is natural. Therefore, all of those in power have a tendency to corrupt. Only scruples prevents them from corruption. The more of their peers corrupt, the more one would.

Criticism is inevitable

When those in power corrupt, criticism is inevitable. This could come from those who want to take power. But it is more likely to come from people who value justice and fair play.

Secrecy ensue

A weak boss will easily be overthrown. Criticism helps to overthrow them. Secrecy may help a cunning boss to prevent criticism. Therefore, a cunning, corrupted boss tend to reduce transparency in the organization.
(Tell-tell signs: If the practice of an organisation suddenly becomes opaque, it may signal corruption.)

Defence against fraud

An unscrupulous boss obtains power for personal gains. Through self reflection, corrupted bosses tend to assume that others want to do the same. Therefore, after gaining power, they tend to tighten the rules to defend against possible frauds.
(Tell-tell signs: if an organisation suddenly tightens its grips on possible frauds, it may signal frauds by the boss.)

Only the ruthless bosses survive

Subordinates tend to criticise corrupted policies, or reveal them to others. A boss who fails to conceal corruption risk will inevitably be criticized. A weak boss will be removed, one way or the other. To survive, a boss must be able to suppress criticism. This can be done through punishment of those who speak out; get rid of them whenever possible. Discrimination by exclusion is a common tactic. Isolating the dissidents is necessary. The Soviet Union's technique sometimes works: to label the dissidents mentally; this will discredit what they say.
(Tell-tell signs: if the most productive staff seem to have little representation in an organisation, or hit hard for trivial incidents, that may signal the implementation of a ruthless tactic by a corrupted boss.)

Hand-picking managers, regardless of their ability

Corrupted bosses hate transparency. In order to ensure that the management is opaque, a corrupted boss will hand pick his managers. The only quality that matters is obedience. Ability comes as a bonus, but is secondary.
(Tell-tell signs: if incompetent people are appointed to key positions, this may signal corruption.)

Legalised corruption

Through change of policy, a ruthless boss can legalise corruption. Since it is legal, there is no danger of "being caught". It is also more difficult to get rid of. Since everybody close to the power are hand-picked, they are guarantee to collude.
(Tell-tell signs: if the management team is very close to each other, that may signal lack of confidence and corruption)

[End]

The future of UK universities

As the government cuts funding, some UK universities will not survive. Expect discounts and bargains. Gradual privatisation is inevitable.

1. With cuts in government support, UK universities can only be supported by their "customers", i.e. students.
2. From 2011, students have to pay £9,000 for their education. So there will be fewer students.
3. Universities have to charge £9,000 unless they are willing to label their degrees inferior to those who do.
4. Market force will determine whether a university survives or not.
5. In order to survive, universities that fail to recruit students will give "scholarships", i.e. discounts, to students.
6. In other words, the £9,000 is only the recommended retail price (RRP).
7. (Marketing strategies such as "buy one get second one half-price" might appear too.)
8. As the market shrinks, some universities will fold, inevitably.
9. When the fee of £9,000 is gradually accepted by the public, the government will be able to cut subsidies further.
10. When universities are no longer subsidised by the government, some will become attractive investments.
11. At a fee of £9,000, a university with 20,000 students will get a turnover of £180 million, which is not a small business.
12. Top universities could attract generous offers, due to their brand name.
13. Selling off universities would generate income to the government. So all politicians will like it.
14. Management of marketable universities will support privatisation too, as that would result in even higher salaries for them.

[End]

An agent-based analysis of the financial crisis

Voters love tax cuts. Government borrow in order to reduce tax and increase spending. Financial institutes help politicians to borrow money; in return, politicians relax their rules on financial institutes. Everyone wins, it seems... except that someone will have to pay eventually. That would be the ordinary people, especially those in the younger generation.

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Everybody wins...

By modelling the motivations of individal groups, one could understand how things might have developed. First, it is important to see that it is the governments that borrow money, and the financial institutes that lend out money. They have their individual motivations.

Governments borrow as much as they could. Through borrowing, they can reduce tax and increase public spending at the same time. Both are music to voters' ears. Most rational politician, regardless of their affiliations, tend to do that. Natural selection will get rid of those politicians who don't.

Banks didn't have that much money to lend out. But through increased leverage, they do. Leverage were increased by governments, through relaxation of regulations. The more money that a bank has at its disposal, the more money it has potential to make. The more money a bank makes, the higher the bonus of a banker. Naturally, bankers lobby their governments to relax regulations.

So governments help banks to make money, and financial institutes help politicians to borrow money. The general public gets tax reduction and more health and social services (governments believe that education doesn't matter, surprisingly). Everyone is happy.

But someone has to pay, eventually

Unfortunately, there is a limit in how high leverage can go. There is also a limit in how much a government can borrow, before nobody is willing to lend. The weakest links are going to burst first. Northern Rock as a bank failed. Iceland as a country defaulted. Greece is seriously imbalanced.

Now can the politicians and bankers still hold everything together? I doubt if they can. So much money created out of thin air. Some have benefited. Now the bubble bursts. Everyone will have to absorb some of the losses.

The financial bubble in the last decade or two is only a redistribution of wealth. The bankers have gained. Politicians in high positions probably benefit from the lobby industry, in one form or another. They both grow the bubble. From the growth, they take their rewards. But someone has to pay for their rewards. That responsibility goes to the ordinary people, especially those in the younger generation.

[End]

The General Theory of bureaucrats

All bureaucrats want to maximize authority/power and minimize liability/responsibility. That is why they try to expand their departments. That's also why by default they tend to say no to every request.

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The bureaucrats principles

Managers in the public sector or an ageing institute do not have incentives such as making money for their institute. They have their personal goals, but all of their personal goals can be achieved by:

• (a) Maximizing their own authority / power; and
• (b) Minimizing their own liability / responsibility

Expansion is joy

That's why all managers in the public sector or an ageing institute want to expand their departments. By employing more subordinates, they increase their power. They can also reduce their own responsibility: hey only manage others to do the jobs; they don't have to do risky (in terms of liability) jobs. Should anything goes wrong, they can blame their subordinates. The more subordinates they have, the more people they can blame.

No novelty please

Suppose a choir asks the government officials for permission to perform in the street. The officials will naturally think of the worst scenarios. Should anything goes wrong, anyone who gives the permission for the event to go ahead will have to take the blame. It costs them nothing to say no. So naturally they would say no.

Easier to apologize than to get permission

The chance is: if the choir does perform in the street, no official will see it as their responsibility to challenge it or stop it. If any official should stop the performance, few will take the trouble to take further actions (such as prosecution) unless something has gone horribly wrong. This is because taking further actions involves unnecessary risk. What if such actions go wrong (e.g. attract public criticism)? According to principle (b) above, they are likely to take no action.

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Traditional Chinese for Classical Literature

I have nothing against using simplified Chinese to popularize classical literature. But proper study of classical Chinese literature must be done in Traditional Chinese.

Classical Chinese literature should be presented in traditional Chinese characters (正寫中文, some call it "Fanti" 繁體). Yes, by all means, present a simplified version ("Jianti" 簡體) for those who don't know traditional Chinese. But there is no need to eliminate traditional Chinese. In fact, it would be foolish to eliminate traditional Chinese characters.

Ancient Greek and Latin have long been replaced by modern languages in daily life, but they are still studied in the Western world. They help understanding the origins of many words, grammar and culture.

Many traditional Chinese characters are simplified to the same character. Many of those characters were different in their original usage. Simplification removes the subtleties in many usage. This is especially true for poems, which were succinct and refined.

The shape of the characters are part of the literature. Simplifying them is changing the literature.

Would one suggest replacing words such as "thou" and "shalt" in Shakespeare with "you" and "shall"? I doubt it.

The meaning of some of the characters and sentences in some classics were ambiguous to modern people. Simplifications worsen the situation. With traditional Chinese, one could gain more clues in the meaning of some characters. Every little hint helps to improve our understanding.

Simplification improves literacy. But literature is beyond literacy. Classical literature is our nation's treasure. We shouldn't pay with the nation's treasure for popularity.

Time to return to traditional Chinese characters

Simplified Chinese characters were introduced in the middle of the last century to improve literacy in China. Now that literacy in China has significantly improved, simplified Chinese has served its purpose. It's time to return to traditional Chinese characters.

簡體字己完成它的歷史任務，現在中國人民識字水平甚高，正體字應重被使用。

Simplified Chinese job well done

When the Communist Party took power in China in 1949, literacy in China was low. To raise literacy, the Communist Party introduced simplified Chinese characters. This has worked. Literacy in China is over 95%, according to Wikipedia (accessed 2011.09.22). Economic development has helped. The one-child policy helps too. China produces millions of university graduates every year.

Price to pay: door to Chinese literature partially closed

There is a price to pay in simplying Chinese though. People who study simplified Chinese will not be able to read traditional Chinese. That means their door to the vast amount of traditional Chinese literature is partially closed. One may argue that, gradually, traditional Chinese literature can be translated into simplified Chinese. Unfortunately, some characters in traditional Chinese are represented by the same character in simplified Chinese. When this is the case, differences in these characters are lost. Besides, some Chinese characters are drawings. Some of these drawings are lost through simplification. Therefore, character simplification reduces the population's understanding of traditional literature. Rewriting Shakespeare in modern English will increase the number of people understanding Shakespeare, but something will inevitably be lost in the rewrite.

Time to return to traditional Chinese

The sole purpose of introducing simplified Chinese characters is to raise literacy. This purpose has been achieved. There is no more reason to keep simplified Chinese. The "ease of learning" motivation for simplified Chinese is no longer significant, given the high literacy in the population. The only possible reason for not changing back is "people are used to it already". But people got used to simplified Chinese within 50 years. Now that the nation is much better educated, it can probably get back to traditional Chinese within 5 years. For university entrance exam (Gaokao) candidates, who are well-known for their diligence, it will probably take 3 to 6 months to learn traditional Chinese after it is specified as the official characters for the exams.

This is no political debate

The question of using traditional or simplified Chinese must not be turned into a political debate. For the fact that simplified Chinese is used in mainland China and traditional Chinese is used in Taiwan and Hong Kong, some might be tempted to turn this into a debate of who the boss should be. The debate should be strictly limited to: which is better for the Chinese culture and heritage, traditional or simplified Chinese? To me, there is overwhelming justification for abandoning the fifty years' temporary measure and going back to the wealth of traditional Chinese.

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