A new book methodically peels back the layers of China's statistical machine to provide new insights into the nation's burgeoning economy
For some, wading through Chinese economic data is like wrapping your head around the Talmud. The credibility of the data itself often invites skepticism from observers both inside and outside China. Yet there's little choice but to rely on the official numbers. And China's regular data dump in the middle of each month moves markets in a way that few countries can. If the market has little faith in Chinese statistics, then why all the focused attention? How does one make sense of Chinese data and its idiosyncrasies?
Many of the answers can be found in the eminently useful Understanding China's Economic Indicators, a new book from Tom Orlik, economic journalist/columnist for the Wall Street Journal. (According to his bio, Orlik has earned the unique distinction of having one of his essays on Chinese statistics be required reading by the National Bureau of Statistics staff.) This is not a "big argument" book on China, but one that methodically peels back the layers of the Chinese statistical machine to yield insights on what the data mean, how they're collected, and what the current shortcomings are. You want to know how the Chinese calculates GDP and fiscal revenue, that's chapter two. You want to know about the country's gold and foreign exchange reserves accumulation, flip to chapter five. Still don't quite understand the composition of China's consumer price index? Don't feel bad, no one really does, as you'll discover in chapter seven. This book is the story of a year with Chinese economic data.
I particularly liked the opening vignette that described a gaggle of Chinese and foreign journalists awaiting the announcement of the 2009 fourth quarter GDP. The anticipation was palpable, torturous seconds ticked by as each reporter is poised to pounce on the final revelation of the figure to phone back to their editors--the economic press in China is all cut-throat competition. And hallelujah, it's 10.7% year-over-year growth, which put the annual growth at 8.7%. Yes! China got the 8% it promised it would deliver at the beginning of the year. In Zhongnanahi, Wen Jiabao smiled and sipped some oolong tea (OK, I made up this last part). Sure, it is admittedly a tad bit nerdy, but in just the right way, especially if you're someone who's really into Chinese economic data (like moi).
So what of the credibility of Chinese data? Orlik takes a similar view to what I argued in response to Megan McArdle's dispatch last year that appeared more about highlighting Hayek than understanding how the Chinese stats system actually functioned. Orlik concludes:
The reality of China's economic data today is not the crude controlling hand of the Politburo dictating the GDP growth figure. It is an increasingly reliable and comprehensive set of economic indicators that remain compromised in some areas by the difficulty of measuring a rapidly changing economy, imperfect surveying methods, a recalcitrant sample set, and continued political sensitivity surrounding some numbers. The system is not perfect. Some data points are more reliable than others. But neither is it a farce. As shown by the mad scramble for the GDP data in the State Council Information Office and the bilions of dollars that are traded instantly on its release, the shortcomings in the data are no impediment to the market reaction.
China has certainly come a long way since the Great Leap Forward days, when complete fabrication of grain production volumes to serve political goals resulted in one of the worst man-made famines in modern history--a point that Orlik discusses at some length. Top policymakers and leaders now rely on numerous data to assess the economy and determine the best course for policy. The very realities of governing a large and dynamic economy requires much less tolerance for outright falsities. Of course, the statistics system still plays catch-up to an economy that is sprinting ahead of it, making the data far from perfect.
Some were surprised by one of the Wikileaks cables that caught Vice Premier Li Keqiang mocking his provincial-level GDP figures as unreliable. It shouldn't have been a surprise. Since the late 1990s, using electricity consumption as a proxy for economic activity has remained a fairly normal practice at both the central and local levels. Relying on "proxy indicators" for GDP growth is one way by which the central leaders counter what they know to be potential local-level doctoring--or "add water" (加水) in Chinese parlance--of their stats, leading to inflated GDP and other growth metrics. Orlik explains some of these proxies in detail.
One reason that electricity consumption has correlated relatively well with economic growth is because industry is by far the largest consumer of power, at perhaps 70 or 75%. As the last decade has been basically defined by China's hyper industrialization phase, capturing a large enough slice of industries--which are massive energy guzzlers--meant you had a rough, but imprecise, picture of the broader economy. The key question over the next decade is whether this correlation breaks down, as China aspires to restructure its economy toward a less industry-led growth model. That is indeed a major pillar of the 12th Five-Year Plan.
If China succeeds in the transition, I suspect Orlik will have to publish an updated edition of his guide to Chinese economic data.
Damien Ma is a fellow at the Paulson Institute, where he focuses on investment and policy programs, and on the Institute's research and think-tank activities. Previously, he was a lead China analyst at Eurasia Group, a political risk research and advisory firm.
In the name of emotional well-being, college students are increasingly demanding protection from words and ideas they don’t like. Here’s why that’s disastrous for education—and mental health.
Something strange is happening at America’s colleges and universities. A movement is arising, undirected and driven largely by students, to scrub campuses clean of words, ideas, and subjects that might cause discomfort or give offense. Last December, Jeannie Suk wrote in an online article for The New Yorker about law students asking her fellow professors at Harvard not to teach rape law—or, in one case, even use the word violate (as in “that violates the law”) lest it cause students distress. In February, Laura Kipnis, a professor at Northwestern University, wrote an essay in The Chronicle of Higher Education describing a new campus politics of sexual paranoia—and was then subjected to a long investigation after students who were offended by the article and by a tweet she’d sent filed Title IX complaints against her. In June, a professor protecting himself with a pseudonym wrote an essay for Vox describing how gingerly he now has to teach. “I’m a Liberal Professor, and My Liberal Students Terrify Me,” the headline said. A number of popular comedians, including Chris Rock, have stopped performing on college campuses (see Caitlin Flanagan’s article in this month’s issue). Jerry Seinfeld and Bill Maher have publicly condemned the oversensitivity of college students, saying too many of them can’t take a joke.
Thicker ink, fewer smudges, and more strained hands: an Object Lesson
Recently, Bic launched acampaign to “save handwriting.” Named “Fight for Your Write,” it includes a pledge to “encourage the act of handwriting” in the pledge-taker’s home and community, and emphasizes putting more of the company’s ballpoints into classrooms.
As a teacher, I couldn’t help but wonder how anyone could think there’s a shortage. I find ballpoint pens all over the place: on classroom floors, behind desks. Dozens of castaways collect in cups on every teacher’s desk. They’re so ubiquitous that the word “ballpoint” is rarely used; they’re just “pens.” But despite its popularity, the ballpoint pen is relatively new in the history of handwriting, and its influence on popular handwriting is more complicated than the Bic campaign would imply.
The neurologist leaves behind a body of work that reveals a lifetime of asking difficult questions with empathy.
Oliver Sacks always seemed propelled by joyful curiosity. The neurologist’s writing is infused with this quality—equal parts buoyancy and diligence, the exuberant asking of difficult questions.
More specifically, Sacks had a fascination with ways of seeing and hearing and thinking. Which is another way of exploring experiences of living. He focused on modes of perception that are delightful not only because they are subjective, but precisely because they are very often faulty.
To say Sacks had a gift for this method of exploration is an understatement. He was a master at connecting curiosity to observation, and observation to emotion. Sacks died on Sunday after receiving a terminal cancer diagnosis earlier this year. He was 82.
The new drama series, which follows the Colombian kingpin’s rise to power, feels more like a well-researched documentary than the gripping saga it wants to be.
Netflix’s new series Narcos is possibly arriving at the wrong time: The doldrums of summer aren’t really the ideal moment for a narratively dense, documentary-like look at the rise and fall of the Colombian drug kingpin Pablo Escobar. Narrated in voiceover by DEA Agent Steve Murphy (Boyd Holbrook), the early hours of Narcos feel like a history lesson, though an visually sumptuous one.
As Netflix continues to expand its streaming empire, it’s making a concerted effort to appeal to worldwide audiences, and Narcos fits neatly into that plan, alongside last year’s expensive critical flop Marco Polo. Narcos was shot on location in Colombia and stars the acclaimed Brazilian actor Wagner Moura as Escobar. It takes full advantage of its setting, loaded with sweeping helicopter shots of the Colombian jungle where Escobar founded his cocaine empire, filling a power vacuum left by various political upheavals in late-’70s South America.
Residents of Newtok, Alaska voted to relocate as erosion destroyed their land. That was the easy part.
NEWTOK, Alaska—Two decades ago, the people of this tiny village came to terms with what had become increasingly obvious: They could no longer fight back the rising waters.
Their homes perched on a low-lying, treeless tuft of land between two rivers on Alaska’s west coast, residents saw the water creeping closer every year, gobbling up fields where they used to pick berries and hunt moose. Paul and Teresa Charles watched from their blue home on stilts on Newtok’s southern side as the Ninglick River inched closer and closer, bringing with it the salt waters of the Bering Sea.
“Sometimes, we lose 100 feet a year,” Paul Charles told me, over a bowl of moose soup.
Many communities across the world are trying to stay put as the climate changes, installing expensive levees and dikes and pumps, but not Newtok, a settlement of about 350 members of the Yupik people. In 1996, the village decided that fighting Mother Nature was fruitless, and they voted to move to a new piece of land nine miles away, elevated on bedrock.
Across the world, ideas of the paranormal persist.
In June, Sheila Sillery-Walsh, a British tourist visiting the historic island-prison of Alcatraz in San Francisco, claimed that she captured an image of a ghost in a picture she snapped on her iPhone. In the frame of what was otherwise supposed to be a picture of an empty prison cell was a blurry black and white image of a woman. The story, which was printed in the British tabloid theDaily Mail, featured on the Bay Area's local KRON4 TV station and mocked by SFist, isn't the first time the Daily Mail has claimed that strange images have come up on smart devices.
Normally, a paranormal story wouldn’t catch my attention, but a few months before the story came out, a Spanish friend of mine named Laura showed me a weird image she found on her phone while I was traveling in Madrid. The photo, taken on her iPhone while on a trip to Ethiopia, shows a boy looking down at leaves he is holding in his hands. Seemingly superimposed onto the boy is another image of the boy, hands in a different position and eyes looking straight at the camera.
A new study pinpoints the Facebook status updates that irk us to the point of no return.
In the 1997 movie Romy and Michele’s High School Reunion, the two title characters, worried that they haven’t done anything noteworthy to share at said reunion, decide instead to lie and claim they invented Post-it notes.
Their story quickly unravels, of course, but had the movie been made a decade later, even the very concept of the ruse would have been impossible. Everyone would have known about Romy’s daily slog at the Jaguar dealership through Facebook.
Or would they?
The ebb and flow of Facebook friendships has become fruitful territory for social scientists in recent years. At least 63 percent of people report having unfriended someone on Facebook, but what prompts these digital rejections can tell us a lot about both the nature of real-life friendship and about how we manage our online personalities.
Wine snobs, string quartets, and the limits of intuition
Several months ago, this author sat at a classical music concert, trying to convince himself that wine is not bullshit.
That may seem like a strange thought to have while listening to Beethoven’s Symphony No. 7 in A major. But Priceonomics had recently posted an article investigating The Price of Wine, part of which reviewed research that cast doubt on both consumers’ and wine experts’ ability to distinguish between quality wine and table wine or identify different wines and their flavors. It seemed a slippery slope to the conclusion that wine culture is nothing more than actors performing a snobbish play.
Listening to an accomplished musician while lacking any musical experience resulted in a feeling familiar to casual wine drinkers imbibing an expensive bottle: Feeling somewhat ambivalent and wondering whether you are convincing yourself that you enjoy it so as not to appear uncultured.
Grasses—green, neatly trimmed, symbols of civic virtue—shaped the national landscape. They have now outlived their purpose.
The hashtag #droughtshaming—which primarily exists, as its name suggests, to publicly decry people who have failed to do their part to conserve water during California’s latest drought—has claimed many victims. Anonymous lawn-waterers. Anonymous sidewalk-washers. The city of Beverly Hills. The tag’s most high-profile shamee thus far, however, has been the actor Tom Selleck. Who was sued earlier this summer by Ventura County’s Calleguas Municipal Water District for the alleged theft of hydrant water, supposedly used to nourish his 60-acre ranch. Which includes, this being California, an avocado farm, and also an expansive lawn.
The case was settled out of court on terms that remain undisclosed, and everyone has since moved on with their lives. What’s remarkable about the whole thing, though—well, besides the fact that Magnum P.I. has apparently become, in his semi-retirement, a gentleman farmer—is how much of a shift all the Selleck-shaming represents, as a civic impulse. For much of American history, the healthy lawn—green, lush, neatly shorn—has been a symbol not just of prosperity, individual and communal, but of something deeper: shared ideals, collective responsibility, the assorted conveniences of conformity. Lawns, originally designed to connect homes even as they enforced the distance between them, are shared domestic spaces. They are also socially regulated spaces. “When smiling lawns and tasteful cottages begin to embellish a country,” Andrew Jackson Downing, one of the nation’s first landscaper-philosophers, put it, “we know that order and culture are established.”
The Islamic State is no mere collection of psychopaths. It is a religious group with carefully considered beliefs, among them that it is a key agent of the coming apocalypse. Here’s what that means for its strategy—and for how to stop it.
What is the Islamic State?
Where did it come from, and what are its intentions? The simplicity of these questions can be deceiving, and few Western leaders seem to know the answers. In December, The New York Times published confidential comments by Major General Michael K. Nagata, the Special Operations commander for the United States in the Middle East, admitting that he had hardly begun figuring out the Islamic State’s appeal. “We have not defeated the idea,” he said. “We do not even understand the idea.” In the past year, President Obama has referred to the Islamic State, variously, as “not Islamic” and as al-Qaeda’s “jayvee team,” statements that reflected confusion about the group, and may have contributed to significant strategic errors.