How a private-sector transformation could revive Japan | McKinsey & Company

With its working-age population shrinking, Japan will need to focus on productivity as never before. A major private-sector initiative to accelerate productivity growth could create a “fourth arrow” of economic reform. A McKinsey Global Institute article.

Source: How a private-sector transformation could revive Japan | McKinsey & Company

South Dakota Residency for Citizens Living Abroad

For US citizens living abroad, participating in domestic business and society can be challenging. One of the most challenging aspects can be obtaining a driver’s license in a state where you no longer reside. All states require demonstration of residency, and nearly all states mail your new or renewed driver’s license to your address on file.

The State of South Dakota caters to a subset of the US population who “travel full time” by relaxing several requirements. People who travel full time are only required to maintain a Personal Mail Box (PMB)1 service in South Dakota, and only need to provide a receipt from a local hotel, motel, or camping ground when applying for a license.2 The Driver Exam Station creates and hands over the license immediately.

For myself the process was relatively fast and smooth. I arrived approximately 8:15am and was handed a number and application form. I had to wait only 15 minutes for my number to be called, and the process of reviewing documents, taking the photo and digitized signature, and printing the card required only about 20 minutes. The following documents were required:

  1. Residency Affidavit
  2. Driver’s license application form
  3. Passport for proof of US citizenship3
  4. Social security card for proof of taxpayer status3
  5. One letter or postage addressed to the PMB4

Because I held a valid license from another state, the Driver Exam Station did not require either the written or driving portions of the exam.

Moreover, voter registration was relatively painless. People who travel full time using a PMB service must appear in person at the county auditor’s office. There was no line at the voter registration section and the application form required about five minutes.5 The person who verified the application only needed to check my South Dakota identification.

Less than a week later my registration has still not appeared in the online registration database. I have not yet attempted South Dakota’s absentee voting process, but I suspect it will be inferior to Oregon’s absentee ballot that I used in the last election.

  1. My PMB is Your Best Address, but there are several alternatives. 
  2. The receipt must contain the address of the PMB service. 
  3. Alternative documents are accepted. See the South Dakota Department of Public Safety website
  4. A copy of the PMB contract is would also be accepted in lieu of a letter. 
  5. The residence address is that of the hotel I stayed the prior night. The form contains a separate section for mailing address, in which I used my PMB address. 

Living Our Values

Living our values means understanding. It means we have to think about our values and understand what are their effects.

It means analyzing why we hold them.

It means deciding how to apply those values to our lives. It means eliminating old habits and creating new ones.

It means eliminating the distractions and focusing on what is most important and consistent with those values.

It means doing, changing. Not talking, not pretending.

It means destroying and creating. It is creativity. It means where you end up may be nothing like you imagined at the start.

Fighting for our values means forcing others to live our values within the cross-hairs of our loaded guns. Whether they like it or not.

When discussing values, most people get busy loading and aiming.

Nikkei: Drying up, flaming out

Japan’s population is just over 127 million at present, about 1.04 million less than its historical peak in 2008. But this decline masks drastic shifts in the country’s demography. The number of people between the ages of 15 and 64 has declined by nearly 4 million, while the 65 and older cohort has shot up by more than 4 million.


On China, On America

Rob England, under the name “IT Skeptic” has posted an important reminder on how much progress China has made in the last few decades.

  • China used more cement in 2011-2013 than did the United States in the entire 20th century.
  • China will have more skyscrapers than the United States by 2017.
  • China has seven of the 10 longest bridges and seven of the 10 busiest container ports.

You owe it to yourself to review his article. China’s economy overtook Japan’s in 2010. It will  overtake the the US economy in the early 2020’s and double that of the US a decade later, by the early 2030’s. The timing of these trends depends on how consistently China maintains economic growth. Arguably China will continue to grow, but not without pains. A large build-up of infrastructure cannot take place without some over-investment and hence the need for recessions to reallocate resources. The arguments begets wrangling over dates,  but not over the underlying trends.

Outwardly a rising China is worrying, particularly for its neighbors with whom they share overlapping territorial claims. For the United States such worries are more abstract, but may include:

  • Attacks against nations with whom the United States maintains security treaties (Japan, South Korea, Philippines).
  • Denial of access to shipping lanes in the East China or South China Seas.
  • Creation of global financial and economic institutions, such as the Shanghai-based New Development Bank, of which the BRICs are members, and the Asian Infrastructure Investment Bank, to replace the IMF or Asian Development Bank.
  • Replacing the US Dollar end the Euro with the RMB in international trade settlements, which would raise transaction costs and interest rates for the United States (and countries with pegs).

Nevertheless, China’s rise does not worry me, for several reasons:

  • China is a civilization pretending to be a nation, in an era of nation states. (How much longer will this era last?) As a civilization, China doesn’t seek to dominate beyond it’s immediate vicinity.
  • China has never intervened in the sovereignty of its neighbors, nor seeks to do so now. In the worst case, China will seek to restore the “tributary system”, but this is unlikely to come to pass.
  • China’s foreign policy does not seek to impose hypocritical “Chinese values” in the same ways as colonial Europe of Japan, or as modern United States. China’s culture is not a missionary one.
  • For all it’s resistance to international institutions, China’s rise is highly dependent on them. The Chinese just wants (and deserves) respect within the frameworks of those institutions, and control within them as befits its stature and contributions.
  • China’s population will peak in 2026 at 1.45 billion and will decline after 2030. The demographic decline will nearly rival that of Japan’s, as a result of it’s one child policy. China’s demographic challenge is exacerbated by the gender imbalance, given the preference for male children. (More United Nations data here.)
  • China is highly dependent on oil from the Middle East through shipping lanes to which the United States can still deny access, should China’s threats become too literal.

All told China will settle down after 2030 as respected power in an  multipolar world. China will have as much responsibility in maintaining a peaceful international system after 2030 as it does in challenging those that desire to constrain it today.  Ironically, the greatest obstacle to the peaceful rise of China won’t be its growth, but the questioned legitimacy of the Communist Party if it fails to deliver growth.

What concerns me more is how poorly the United States has invested it’s own capital over the last decade. Since 2001 the United States has committed $4.4 trillion to wars in Iraq, Afghanistan, and Pakistan which have provided zero benefit to the United States, it’s business interests, it’s citizens, or their security. In fact, the primary beneficiaries have been Iran, China, and the ISIS.

Sometimes I dream of what we could have achieved with more wise and inspired investments over the last decade and a half. Would we have landed Americans on Mars? Would we have revitalized our decaying infrastructure, built new infrastructure within Mexico and around the border in order to support expanded trade? Would we have invested in Mexico’s institutions and people in order to end illegal migration once and for all?

Maybe not. The hawks are now calling the ISIS the most imminent national security threat  without offering a shred of evidence. The list includes Congressman Michael McCaul, chair of the Homeland Security Committee, Sen. Marco Rubio, Sen. John McCain and Defense Secretary Chuck Hagel. (Presumably, if pressed their answer would be “if you knew what we know, but can’t tell you for reasons of national security, you would agree with us”. We heard this in Vietnam, and it wasn’t true then, and it isn’t any more true now.) Now they want to trap United States into spending several more years and $100’s of billions directly countering the ISIS in Iraq with American boots on the ground, using classical chains of escalation that are well rehearsed. And in two years they may control all three branches of government again. A few trillion here, a few trillion there…

I suggest that we let China deal with ISIS. Chinese companies will be the primary beneficiaries, due to their investments in Iraq and Iran. I also suggest we open direct dialog with Iran towards a acoordinated solution.

The political establishment of the United States needs to realize that the world is becoming multipolar and there are limits to the its reach and power. The sooner we do this, the sooner we can move forward with a consensus that makes sense in the world we now live in. It is the world we made, after all.

Japan Salaries Extend Slide as Inflation Begins to Take Root – Bloomberg

Stagflation seems to be the inevitable result of Abe’s attempts to restart the economy. Moreover this is apparent even ahead of the economic cliff in April.

Abe needs to press forward with economic reforms and participation in the TPP talks. Raising the sales tax needs to be scrapped in favor of taxes that encourage more investments, i.e., energy efficiency and carbon reduction. Finally Abe needs to take steps to encourage innovation and startups.

Sober Look: 3 key facts about Japan’s deteriorating demographics

There is an old story about boiling frogs: if you throw one in hot water, he will just jump out. Throw him in cold water instead and turn up the heat gradually. So it is with Japan’s demographic crisis, one that is slowly boiling, and whose impacts weren’t clear until I saw these charts.

Japan has lost 10% of its productive capacity in the last two decades. Nobody should now wonder the cause of the nation’s lost decade, which began in the 90’s is now stretching into its third decade. Even worse, the nation’s younger workforce are underdeveloped in professional roles and are scarcely capable of replacing those lost through retirement.

Moreover it is clear that economic growth can only be maintained through expanding the workforce, or through a drastic increase in productivity, or both. The former can be achieved by expanding participation of women (the world’s most talented), delaying retirement, expanding flexible post-retirement opportunities, and encouraging immigration. Immigration will not happen for a variety of reasons.

There isn’t much evidence that productivity will make the necessary leaps. Reform, the third leg of Abenomics appears to be stalled. The expanded use of robotics will progress but only in fits and starts and will not progress in the neat linear fashion played out by its demographics.

Therefore Abenomics is predicated on stealing from its savers in favor of incumbent business interests. Technically this is achieved by buying JGB’s in order to drive down their value, encourage speculation in equities and reduce the buying power of JPY currently held. The former President of the Bank of Japan saw and said so much.

Where does that leave Japan? In the long term the outlook is good that the nation will retain its unique identity while reducing its population density, currently 2nd behind Bengladesh. In the short term the the nation must brace for reducing its credibility and prestige throughout the world, and for scandalous maltreatment of its retired generation.

If Not Progress, What? If Not Mars, Where?

Last month two events led me to do some thinking about manned exploration of Mars.

Billionaire investor Dennis Tito, under the Inspiration Mars Foundation umbrella, announced plans to launch a 1.4 year manned circumnavigation of Mars in 2018. I had the enviable assignment of writing our official position for The Mars Initiative, a fundraising organization I helped found in 2012. (If you marsglobe1x200haven’t had the chance yet, please review the rest of the website, as well as my post.)

The IMF announcement catalyzed some necessary discussions within TMI that will remain ongoing for several months. IMF’s agenda is ambitious, particularly the timeline and the margin for safety and testing. In the broader community most people are skeptical about whether the mission can be achieved, and a few are adamant that it cannot be achieved. I think it is achievable, and failure of one attempt will not prove this assertion false (n=1 is not a sufficient sample). This mission could not have been conceived two years ago because the necessary commercial developments had not yet occurred. The project operates under a tight schedule constraint, and execution risks abound.

In 2003 I was one of the original founding members of the Dallas Chapter of The Mars Society, which last year successfully hosted their national convention. I continue to host and update their website. Then and now, getting involved in Mars-related organizations seemed like something interesting to do that not many other people were doing. It wasn’t until I wrote the following words that the magnitude started to sink in:

IMF is inspiring multiple generations to prepare immediately for humanity’s genesis as a multi-planetary species.

I feel I have to put that into context.

  • 2 million years ago: The Homo genus first used stone tools.
  • 1.8 million years ago: Homo erectus first left Africa, probably used more complex tools and fire.
  • 75,000 to 125,000 years ago: Modern humans migrated once again from Africa and replaced the indigenous Homo populations. 1
  • 5,000 years ago: Humans first harvested energy for transportation–via the wind sail.
  • 200 years ago: Humans began systematically converting chemical energy into locomotion.
  • 1961: The first human left the atmosphere (and returned safely), using chemical energy.

In addition to energy, the organizational systems and technological environment (i.e. Kevin Kelly’s technium) enabled such accomplishments.

On a planet that is 4.5 billion years old in a galaxy that is 13 billion years old, the recent rapid pace of social and technological development is remarkable. There are 200 to 400 billion stars in our galaxy. We are rapidly discovering planets around many of them. In the end there may be at least as many planets in our galaxy, and tens or hundreds of millions that are approximately like Earth. I think it is safe to conclude that life exists all throughout our galaxy.

The existence of complex life like that found on Earth is more dubious. The existence of complex social and technological systems like that of modern homo sapiens is even more in doubt. Amid vast numbers, and vast timescales, the current progress of our species is truly remarkable.

In the first paragraph I mentioned there were two events. The second of was the opportunity to complete the reading of Robert Zubrin’s new mini-book, Mars Direct. Much like his earlier books, it outlined a plan to put humans on Mars in one decade. MarsDirectIn addition it echoed the criticisms made in his previous books of the the political and administrative dysfunctions that have stifled the plan over the last thirty years.

The next step for homo sapiens is to become a multi-planetary species. Indeed the entire progress of humanity almost seems to have led us to this goal, if such a thing would be possible accidentally. The necessary social and technological prerequisites have already been developed. The flame and passion for exploration thrives, as does our ability to engage in collective action for group benefit. For the last 5 decades, humanity has been one to two decades away from achieving its first steps towards that goal of putting its first representatives on another planet.

It is frustrating, therefore, to witness that ways and means that we have convinced ourselves that squandering progress was in our collective best interests.

There is nothing magical about Mars. It is simply a rocky body with 40% the mass of Earth and an atmosphere that provides some protection from and redistribution of solar radiation at the surface. Unlike the Moon, Mars contains the requisite atmosphere and resources to sustain an self-sufficient and permanent human civilization. The technologies will take longer than one to two decades, but their development will inevitably provide benefits back on Earth. It is important to note that humanity faces time pressures that are similar to those Inspiration Mars faces–expanded from years into decades or centuries. I won’t turn this into a tract on the dangers of nuclear weapons, global climate instability, or accidentally misplaced asteroids. These dangers are all real enough.

The remarkable achievements of humanity are a but the smallest spark, and they are not guaranteed to endure. Making sure they endure, and building on them is our responsibility.

1 DNA evidence now suggests some modern non-African humans in Europe and Asia contain DNA not found in our more immediate African progenitors, as a result of interbreeding with these earlier Homo populations. 

Skeptic’s Guide to Weight Loss

In the last two years have reduced my weight from 103kg to 93kg, most of that in the last 6 months. My goal is 83kg (183 lbs).

Unfortunately, there is lots of bad information about how to lose weight. My formula, which I have also used successfully in the past, is based on simple principles.

Principle 1: All that matters is number of calories consumed. IMG_1613There is no consistent evidence that any of the following factors matter:

  • Amount of carbohydrates (i.e. low carb fads)
  • Time of day
  • Fruit combined with other foods

These factors can affect overall health and satisfaction, but not weight loss. The only thing that matters is how many calories you eat.

Principle 2: Exercise is about health, not weight loss. I do walk and run everyday. Exercise is important for health, happiness, and longevity, but it is not a factor in weight loss (due to muscle gain and skeletal strengthening, the opposite may occur). 15 minutes of running burns about 150-200 calories–less than a Snicker’s bar. Walking for 1 hour burns about twice that–less than a Double Caramel Mochachino at Starbucks. You cannot substitute extra calories for exercise, as a treat for good behavior, and expect to lose weight.

In general, I do not allow myself to offset calories burned through exercise for additional food intake. To guard against this, I track my exercise at the end of the day, after I am done eating.

IMG_1614Principle 3: Mindfulness of food intake is important for weight loss. There is significant evidence that tracking your consumption reduces intake. Methods may include taking a photo of everything you eat, writing down all food in a log before eating, or tracking calories in a log or spreadsheet. Tracking your weight daily also improves mindfulness.

I use a free application for the iPhone called Lose It. It tracks food with each meal, shows me daily and weekly summaries, remembers what I entered previously, contains a database of common foods, and lets me enter custom foods. Lose It also sets goals and tracks your weight (the premium version, which I don’t own, does a better job of this.)

Principle 4: Balanced nutrition is important for health. For me a healthy diet includes fruits, vegetables, meats, eggs, plant protein (supplement), carbohydrates, and plenty of water. The allure of vegetables for weight loss is obvious: they are nutritious and tasteful while low in calories. The same can be said of chicken and some foods high in proteins (I won’t debate right now the health effects and social effects of animal consumption).

The allure of grains (rice, wheat, corn, soy) for social planners is equally obvious: they are cheap and high in calories. Although I differ with low carb diet plans, the rationale is obvious: carbs contain a lot of calories. The extent of this becomes obvious when you start tracking your calories.

My weight loss plan includes a daily calorie goal set by Lose It. In the last several weeks I have used it consistently and successfully. However, there is a downside: hunger. You have to push through the hunger, but over time it has gone down as my stomach size has adjusted. Many diets pretend to cheat hunger using psychological techniques. Substituting protein for carbohydrates probably helps, but too much may be dangerous for health. Other techniques may work, but most probably won’t, and they are generally not worth the price you pay.

Three times in the last three months I have created “cheat days” when I stop tracking my calories. This was due to burn out, fatigue, hunger, or simple inconvenience (i.e. a party). The occasional cheat day does not seem to have affected my weight loss schedule. Because of my smaller stomach or reduced appetite, my idea of binging is much smaller than it used to be.