Reading Rights: Google and the Digital Book

The most recent chapter in the evolution of the book is getting attention from international courts, Fortune 500 companies like Microsoft and Yahoo, and The United States Department of Justice. As the world’s wealth of digitized knowledge grows, Google hopes to add to the collection by scanning thousands of books and making them available to anyone with access to the web. Some books would be available for free and others would require a purchase in order to view the entire work.

This move did not go unnoticed by authors and publishers who immediately sued Google for breaching copyright laws. After reaching an agreement that would require Google to share any revenues it receives from digital book purchases with authors and publishers, the two parties are currently seeking judicial approval of the agreement.

But not everyone is in support of this new arrangement. Several countries including Germany, France, and Japan have filed reports to the American Court handling the case, claiming that this agreement would violate their copyright laws. Competing firms like Amazon, the manufacturer of the Kindle, suggest that the arrangement would create a monopoly and limit choice for consumers.

Our recent discussions in class regarding the balance between rewarding those who innovate while also allowing society as a whole to benefit from an idea, come to mind when reading this article. Are Google’s actions anti-competitive or are they providing a revolutionary service and technology to society? I believe that this issue will resolve itself when publishers and authors accept this new medium for their work and embrace the digital model. Regardless of the decision, the technology of accessing thousands of books from your computer or phone is here to stay. So read on!

Job losses ebb, but unemployment up

The unemployment rate is now the highest it has been in 26 years. Fewer jobs have been lost in the past year, but more and more jobs are being cut from payrolls. With less opportunity, the unemployment rate cannot go up, unless people drop out of the labor force. This article provides an overview of some of the factors of why the unemployment rate is so high and how it is connected to our economy's performance.

Fed's Fisher sees near-term strength for economy

This is a good article that talks about how we are saving more than in the past. Fisher suggests that it will be a slow crawl back to economic growth. Because firms are not seeing growth in profits, focus is on cutting costs and to remain on the payroll, productivity must improve. I also like the stance he takes on Congress not interfering with the Fed's current monetary policies. Politics creates a desire for immediate solutions.

Why College Costs Rise, Even in a Recession

This article caught my attention and raised a few questions for me. The question being asked is, where is our money going when the cost of college rises? Will the price of college ever stay the same or even decrease? College tuition has only gone one direction...up. Lafayette College President, Daniel Weiss, discusses some of the difficulties Universities have when looking into making changes. Various costs from salaries of faculty to non-faculty are included in students tuition. It would be great to see where all of our money is going specifically. Some schools are allowing students to graduate in three years and saving money that would be spent on the fourth year. I know most students agree on the topic of tuition being plain crazy, but hopefully our benefits we receive from attending OWU will outweight the cost in the longrun.

Stiglitz Says U.S. Economic Recovery May Not Be ‘Sustainable’

In the following article, Joseph Stigliz offers two scenarios for the economic recovery, which according to him may not be sustainable. The first one is characterized by consumption lags and slow private investment, while the second resembles "W-shaped" recovery, that is a rebound followed by an abrupt downturn.

Another Option in the Health Care Debate

This article highlights a farmer in Wisconsin while presenting another option for congress to consider in the current health care debate.

When Cheap is Exclusive

How do you know the recession is really serious? When high-end retailers like Nieman Marcus are forced to compete with luxury e-tailers who are selling designer goods at rock-bottom prices, apparently.

Consumer preferences have changed dramatically given the current economic climate, and it seems that few industries are immune to belt-tightening. Saks Incorporated announced losses of more than $5o million in three months, for example. Meanwhile, e-tailers such as Gilt Groupe, HauteLook and Rue La La are able to sell designer apparel at as much as 80% off--and they've been making a lot of money doing it. Gilt, which was started by two Harvard grads in 2007, expects revenues of $400 million next year. These sites are exclusive, and shoppers see it as a serious business, rushing to buy sale items before someone else. They are so popular that retailers are scrambling to create their own sites with as much allure as these luxury e-tailers.

This article provides interesting insight into the tough economy Americans must deal with. All businesses must be dynamic and change with the times in order to stay afloat and give consumers what they want, a concept that has been illustrated everywhere from automobile dealerships to grocery stores.

Stimulus Credited for Lifting Economy, But Cost and Joblessness Questions Linger

This article is referring to Presidents Obama’s Stimulus Package and Vice President Biden’s recent speech on the package. In Vice President Biden speech, Biden said, "If you look at the Recovery Act as a two-year marathon, we're at the nine-mile mark," Biden said. "We're just approaching the nine-mile mark. Two hundred days in, the Recovery Act is doing more faster and more efficiently and more effectively than most people expected." Biden feels that the $787 billion dollar stimulus package is improving the economy. Although not everyone is agreeing with the Vice President as 57% of Americans believe that the economy is not improving. Only time will tell the result of the Stimulus Package. 

HSBC Says Switzerland Luring More Rich Foreigners as Taxes Rise

This report by HBSC indicates that more rich non-Swiss citizens are inquiring about becoming Swiss residents because of high taxes in their home country. For instance, the UK will charge people who make more than £150,000 ($244,000) a year 50% income tax (relative to the UK, the marginal US tax rate isn't too bad).

Thus, the question for policy makers is - "How much can the government raise taxes before it starts losing its top tax payers?". For reference, in 2007, the top 1% of tax payers (with more than $410,096 Adjusted Gross Income) accounted for 40.42% of total US tax revenue.

The Return of Capital Spending

This article gives a very positive outlook for the future recovery. First, it states that many companies feel more confident about investing more money into heavy equipment, new software and buildings. The author also mentions that those companies that continue cut spending are “doing less drastically.” Finally, the article emphasizes that “capital spending will be a critical growth driver in the coming years.” I think that it is a very important factor in the economy, and it might push the unemployment rate down at the beginning of 2010.

Obama Aides Aim to Simplify and Scale Back Health Bills

After reading some of the other articles posted on the blog, I thought this would be another good addition to the collection. The article talks about Obama's plan to address details with healthcare this week. Obama has submitted a proposal for a "government-run competitor to private insurers" and this has caused a lot of controversy. Many people are bringing up talks about socialism. We have touched on this topic a few times in class, and how we are no where near becoming a socialist economy, because the government does not make all of our decisions. I am curious to see what other students have to say about this. Other articles posted on the blog have mentioned Obama's plan and how this will eventually reduce costs in the future. Do the potential benefits (reducing the initial cost of any bill and reducing the size of cuts needed in the future growth of Medicare) outweigh the costs and concerns of the American people?

Return of the Trustbusters

What lies ahead for big-business in the United States? According to Christine Varney, the new head of the Antitrust Division of America's Department of Justice, tough scrutiny and a vigorous new antitrust policy are to follow.

There is already speculation that her first target will be Google, aiming to make it the new Microsoft. The FTC has begun an investigation into the overlap of the boards of Google and Apple, possibly paving the way for more stringent oversight. Varney has said that she believes that the failure of the Bush Administration to effectively monitor antitrust activity was a direct contributor to the current economic state.

However, there is another issue: while Varney seems ready to hold large firms' feet to the fire, are some organizations just too big to be allowed to fail, especially given the instability of the economy?

How Big of a Deal is Income Inequality?

This is article is from Stephen Dubner, one of the co-authors of Freakonomics, New York Times Blog.  The article is by a guest author, William Bernstein.  Bernstein provides a neurologists perspective on the significance of income inequality.

Bernstein first addresses the progression of material improvement.  He argues that for most human history the average person never improved their material income.  About two hundred years ago, the shift began and humans began to improve their material well being by about 2% each year.  In the article, Bernstein discusses the psychological affects of the shift specifically in regards to the importance of private property to the individual human being.

The article mainly addresses the importance of private property and income to the individual.  Bernstein identifies obesity and homicide rates to poverty, which he claims is a direct result of income inequality.

Yen rises in Asia as stocks slide

This article discusses about yen rises against Euros and US Dollars. The article argues that the nervousness of investors about sustainability of global economic recovery leads them to invest for a relatively safe currency.

Bad News for Japan: Since September 2008, yen rises so much against other currencies and I believe it causes one of the reasons for the current economic downturn in Japan since Japan is one of the export oriented countries.

For example, when I came to the US in September 2006, $1 could buy 120 yen and now $1 can buy only 92 yen. Also, 1 euro could buy 159 yen on September 1st, 2008. However, 1 euro can only buy $133 yen on September 1st, 2009.

Good News for me: When I visited Europe during the summer of 2007, I surprised with how everything are expensive compared with Japan and the US, but situation should have changed by now if I visit my old friends in the UK.

Stimulus Tax Relief: Who's Feeling It

This article discusses the different programs that are in place for tax relief from the Recovery Act. It talks about tax credits given to individuals, first time home buyer programs, as well as business incentives.

Current progress of this money is tracked in the article. Also included are future predictions for how the stimulus tax relief may be able to help and make a difference for many.

Argentine Opposition Leader Urges Economic Change

Article on how the current Argentine administration is trying to urge its President to curb spending, boost transparency, and draw investment. Argentina's growth has slowed from 7 percent to 2 percent and they are trying to find new and innovative ways to change their economic system.

America’s long-term budget outlook has worsened. Not for the last time

This article is mind-blowing. These mid-session review numbers are outrageous and does not look good for those of us graduating soon to get jobs that pay well, let alone jobs! 

The mid-session review, increased the White House estimates of America’s cumulative ten-year deficit by almost $2 trillion to $9.05 trillion. Federal debt will reach 77% of GDP in 2019, up from 41% in 2008. America’s public finances show no sign of recovering to a sustainable level in the future. The average deficit over the next decade is now expected to be 5.1% of GDP, rather the 4% in the original budget. Even in 2019, the last year of the forecast period and after the crisis, a deficit of 4% of GDP is still expected. Production is expected to rise by only 2% in 2010, rather than the 3.2% in the original budget, while the unemployment rate will peak at 10%.

Obama says that controlling health-care costs is a big part of the long-term fiscal solution but other spending cuts and higher tax revenues will also be vital. Otherwise, America’s depressing budget figures will get even worse.

UK presses Caymans to raise taxes to solve deficit

UK is putting pressure on the Cayman Islands to start raising taxes to help them get out of their large accumulation of debt. The Cayman Islands is known for being a tax haven for many businesses but they are working with the UK to raise their taxes and eventually get their country back into a surplus.

Pfizer Fined $2.3 Billion in Health-care Fraud Settlement

An article about moral incentives and government regulation.

Commonwealth Suspends Fiji Over Democracy

Pressured to hold elections, the military led government of Fiji has resisted, insisting that in order to achieve political reform, they could not hold elections before 2014.

In the process, Fiji has been suspended from the 53-Nation Commonwealth for failing to meet certain conditions which include holding democratic elections.

Syria Cracks Open it's Frail Economy

This article explains the recent rapid opening of Syria's economy. Once viewed as a "rigid socialist economy", new economic opportunities are becoming available for Syrians. These include the use of private banks, and the permission to hold foreign currency. In addition, the country's first stock exchange opened in March.

These changes have affected U.S. relations positively, and the U.S. hopes that ties with Iran will be weakened. However, this relationship with Iran has also casted doubts, amongst other factors.

Will Africa begin to prosper as fertility rates fall?

http://www.economist.com/opinion/displaystory.cfm?story_id=14303769

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South African Government Intervenes to Help Equalize Opportunity

Fifteen years after the apartheid, black South Africans are still highly isolated and are not given the same opportunities as the white citizens. To help remedy one such inequality the government has established a public bus system to give commuters another, less expensive, option for travelling to work.

The bus system will provide transportation for half the price of using the local taxis ( 5 rands as opposed to 10), and this has caused an uproar of protest and violence among the taxi drivers.

This new bus program was intended to help distribute opportunity more equally, but at the same time is slowing efficiency a great deal by creating street congestion, since taxi drivers are now on strike.

*Note* South Africa is to host the 2010 Soccer World Cup

Malnutrition in Guatemala: A National Shame

This article describes the desperate situation of rural poor in Guatemala, where child malnutrition has reached 80% in some parts. Although Guatemala is not an impoverished country by world standards, their wealth is poorly distributed between the rural and urban population. Another concern is that this inequality of wealth is extremly correlated with race, with Guatemalans with more indigenous (mayan) heritage being more poor than Guatemalans of more European descent. Government intervention is needed in order to bring the rural poor out of extreme poverty. This is a perfect example of when sacrificing efficiency for equity is appropriate and necessary.

Corruption undermines Libya's oil-rich economy

Dudley Says Fed Can Avoid a "Bad Inflation Outcome"

SEC warns on broker-dealer pay incentives

Interesting article about a moral incentive system and the regulation roles that the SEC must consider.

Swiss banks expect to avoid witch-hunt

Switzerland's top private bankers are convinced they can avoid a damaging witch-hunt over their activities by U.S. authorities, in the wake of UBS's tax row.

Changes in Japan's Government

Changes in Japan's Government, may lead to changes in their economic system.