Economist Jan 12th 2013

The great innovation debate: innovation is slowing and governments need to help it along

  • biggest impediments is government: officialdom tends to write far more rules than are necessary for public good; the West’s intellectual-property system is a mess because it grants too many patents of dubious merit.
  • productivity is most stagnant in public sector: unions;

Jack be nimble: Jack Lew, a successor to Timothy Geithner

  • Geithner, a central banker and a crisis manager; Jack, spent most of his career with budget issues, a budget technocrat;
  • main task: currency relations with China, and collecting taxes;
  • Jack is not an outsider, like from Wall St, to repair relations with business and with Republicans, but an insider and is more liberal (less warm relations with Congress);

Obama picks his soldiers: Chuck Hagel as defense secretary, John Brennan as director of the CIA

  • Obama is looking for: experience, caution, and view that the world is messy and opportunities for wielding unilateral American power is limited;
  • Mr Hagel, few friends in his own party, most “antagonistic” towards the state of Israel in history;
  • long-standing preference for engaging with Iran, seen as tantamount to appeasement;
  • slim down a “bloated” Pentagon offends those who think the defense budget should be sacrosanct;
  • disliked by Republicans, a stern critic of the Iraq war;

The fraying knot: declining marriage rates and “marriage promotion”

  • falling marriage rates , with them come rising out-of-wedlock birth rates;
  • poverty is a cause, not a result of low marriage rates;
  • government should help create more jobs, and to ensure access to family-planning services to keep unwed birth rates down; rather then to promote marriage as a route to economic success;

Slamming on the brakes: politics of traffic lights

  • official response was prompt and surprisingly conciliatory; rare for Chinese officials especially the police to yield to public opinion;

Long overdue: ending “laojiao” system

  • important questions remain about what might replace it;
  • but others see encouraging signs in the decision;

Battling the censors: protests calling for press freedom

  • Southern Weekend’s supporters has been unusually bold; some party leaders may worry that even a modicum of political liberalization could open the floodgates to demands for far-reaching change;
  • public response: even as activists delivered their daring speeches, backed up by massive online support, most white-collar workers from nearby office buildings walked past paying little attention;

From guard shack to global giant: Lenovo become the world’s biggest computer company

  • “protect” two huge profit centres — corporate PC sales and China market;
  • vast distribution network in China, offers lessons for other emerging markets; put a PC shop within 50km of nearly every consumer, cultivate close relationships with its distributors;
  • “attack” new markets: in India, one-way exclusivity for retail distributors; acquisitions in Germany, Japan, Brazil; buy back smartphone arm;
  • tiny problem: the “attack” part is largely unprofitable;
  • different from other Chinese firms: little or no official interference; English the official language; foreigners look like they belong;
  • some way to go: reliance on one market, China; crumbling PC mountain but Mr Yang shows an unfashionable faith in PCs (85% of Lenovo’s revenues), “PC+” approach;

France v Google: Free, a French ISP, set ad blocks by default

  • whether to pay the ISP directly for the connection to its subscribers;
  • (for French finance ministry) how to force Google to pay more taxes;

Home truths:

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