Ten interesting things we read this week

Some of the most interesting topics covered in this week's iteration are related to 'Race to replace Cobalt', 'Need for customized digital solutions' and 'Booming logistics sector in China'

Published: Aug 26, 2018

g_108605_bg_shutterstock_267649895_280x210.jpgImage: Shutterstock

At Ambit, we spend a lot of time reading articles that cover a wide gamut of topics, including investment analysis, psychology, science, technology, philosophy, etc. We have been sharing our favourite reads with clients under our weekly ‘Ten Interesting Things’ product. Some of the most interesting topics covered in this week’s iteration are related to ‘Race to replace Cobalt’, ‘Need for customized digital solutions’ and ‘Booming logistics sector in China’.

Here are the ten most interesting pieces that we read this week, ended August 24, 2018.

1) Electric cars: The race to replace cobalt [Source: Financial Times ]
Tufts professor Michael Zimmerman is hoping a material he invented in his basement can help solve a crisis facing the electric car industry — which has inadvertently tied its fortunes to one of the poorest and least stable countries in the world. His homegrown prototype could pave the way for a new generation of batteries that does not use cobalt, a silver-grey metal, more than 60% of which is mined in the Democratic Republic of Congo. Cobalt supply is dominated by a handful of mining companies, including Switzerland-based Glencore, or mined by hand and sold to Chinese traders in the country. Child labour is common, according to human rights groups. In other words, the product that is the shining hope of the new economy is, for the time being, highly dependent on some of the most-criticized practices of the old industrial economy.

For many experts, the battery will reign supreme in this century — just as oil did in the last. But batteries are complicated to produce and contain a delicate mix of chemistries that have to meet a demanding list of performance requirements. Customers expect fast charging, a long battery life and safety — and in conditions ranging from the cold winters to the heat of the Arizona desert. Without a big shift in battery technology, cobalt demand is set to more than double during the next decade — with the share from the DRC set to rise to more than 70%. Gleb Yushin, a professor at the School of Materials and Engineering at Georgia Institute of Technology, puts it more bluntly: the potential growth of electric cars will not materialize, he says, unless there is a battery breakthrough.

Cobalt is essential for stopping the battery from overheating and the stability it brings to the battery materials also allows users to charge and discharge their car over many years. But it is also the most expensive of the metals used — hindering the ability of carmakers to lower the cost of electric cars to compete against their petrol counterparts. Metals account for about 25 per cent of the battery cost and while new sources of cobalt are being developed in Idaho, Alaska and Australia, they are not due to produce metal until after 2020.

To improve the battery performance, Mr Zimmerman, a materials scientist, started to look at a relatively unexplored area of research — the electrolyte, which is generally what catches fire in batteries. If a solid material instead of a liquid were used, so the theory goes, the batteries could be safer and lighter. It could also allow carmakers to reduce the amount of cobalt in the cathode or even, he says, eliminate it entirely. The first electrically conductive solid was discovered in the 1830s by British scientist Michael Faraday but it had never worked in a battery at room temperature. Working in his basement Mr Zimmerman created a polymer material that could do just that. While carmakers from Toyota to Mercedes-Benz and the British engineering group Dyson are working on so-called solid state batteries like Mr Zimmerman’s such batteries are unlikely to enter the market until 2025.

In the meantime, battery companies are racing to reduce the amount of cobalt they use with conventional technology. Tesla has said the company was “aiming to achieve close to zero usage of cobalt in the near future”. Most carmakers are moving towards batteries that use more nickel and as much as 75 per cent less cobalt. For his part, Mr Zimmerman says the low-cobalt batteries still come with a considerable fire risk that will require expensive monitoring technology. “The cobalt is expensive — and it gets mined from unethical sources in the Congo, so people want to put less cobalt in,” Mr Zimmerman adds. “When you put less cobalt in, the voltage of the cathode goes up and the current liquid electrolytes can’t work at that higher voltage” He says the prototype he’s built can and he’s working with companies to commercialize the technology. If successful, it says it could find its way into batteries within a few years and into electric cars after that.

2) The Western Illusion of Chinese Innovation [Source: Project Syndicate ]
Over the past two decades, China has been achieving rapid technological progress, thanks in no small part to its massive investment in research and development, which totaled some 2.2% of its GDP last year. Yet, according to this piece, China is nowhere near the technological frontier. In fact, the distance separating it from that frontier is far greater than most people recognize. In the West, many economists and observers now portray China as a fierce competitor for global technological supremacy. They believe that the Chinese state’s capacity is enabling the country, through top-down industrial policies, to stand virtually shoulder-to-shoulder with Europe and the US. Harvard economics professor and former US Treasury Secretary Larry Summers, for example, declared last March at a Beijing conference that it is a “historical wonder” that China, where per capita income amounts to just 22% that of the United States, could have the world’s cutting-edge technology and technological giants. The US Trade Representative (USTR), in a March report, presented the “Made in China 2025” plan – a 2015 blueprint for upgrading China’s manufacturing capacity – as proof that the country is seeking to displace the US in high-tech industries that it considers strategic, such as robotics.

Moreover, the USTR report asserts, China has happily played the game on its own, and has violated current global rules to achieve its goals. Indeed, many Westerners warn that China is planning to use its technology-based power to impose an entirely new set of rules that is inconsistent with those long enforced by the West. This is a serious misrepresentation. While it is true that digital technologies are transforming China’s economy, this reflects the implementation of mobile-Internet-enabled business models more than the development of cutting-edge technologies, and it affects consumption patterns more than, say, manufacturing. This kind of transformation is hardly unique to China, though it is occurring particularly rapidly here, thanks to a huge consumer market and weak financial regulation.

Furthermore, it is not so obvious that these changes have anything to do with the government’s industrial policies. On the contrary, the growth of China’s Internet economy has been driven largely by the entrepreneurship of privately-owned companies like Alibaba and Tencent. In fact, Western observers – not just the media, but also academics and government leaders, including US President Donald Trump – have fundamentally misunderstood the nature and exaggerated the role of China’s policies for developing strategic and high-tech industries. Contrary to popular belief, these policies do little more than help lower the entry cost for firms and enhance competition. In fact, such policies encourage excessive entry, and the resulting competition and lack of protection for existing firms have been constantly criticized in China. Therefore, if China relies on effective industrial policies, they would not create much unfairness in terms of global rules.

Having said that, what are China’s actual technological prospects? The Chinese are certainly fast learners. Over the last 30 years, Chinese manufacturers have proved adept at seizing opportunities to emulate, adapt, and diffuse new technologies. But technological advances in the Chinese business sector occur at the bottom of the smile curve, and core-technology owners have extracted most of the added value from Chinese manufacturing. For example, in Danyang, a county of Jiangsu Province that is a production hub of optical lenses for global markets, manufacturers can produce the most sophisticated models. Yet they lack the core software to produce, say, progressive lenses, so they must pay a fixed royalty to a US company for each progressive lens they make. Likewise, China’s automobile manufacturers still import their assembly lines from developed countries.

Clearly, there is a big difference between applying digital technologies to consumer-oriented business models and becoming a world leader in developing and producing hard technology. The latter goal will demand sustained investment of time, human capital, and financial resources in sectors with long basic R&D cycles (such as pharmaceuticals). Given this, China probably remains 15-20 years away from matching the R&D input of, say, Japan or South Korea, and when it comes to output – the more important factor – it is much further behind. While China can accelerate progress by attracting creative talent and strengthening incentives for long-term research, there are no real shortcuts when it comes to achieving the gradual shift from learning to innovating. Here, universities have a pivotal role to play, not only by training new scientific and technological talent, but also by conducting basic research. This means moving beyond the focus on increasing the sheer number of students and placing greater emphasis on quality of education. None of this can happen overnight.

3) Playlists vs. borders: Music streaming brings South India closer [Source: The Ken ]
Something remarkable has been happening in South India over the last few decades. Music composers are becoming multilingual at an unprecedented pace. There is a visible shift in how music gets created, adopted, recreated, shared, consumed, the works. Composers, to row safely through this musical wave, have adapted by creating music across South Indian languages. They launch in one language, say Tamil, then move to creating music in another, say Malayalam, then test waters in a third, say Telugu. And the cycle continues. Tamil music composing giant, Ilayaraja, debuted with the Tamil film Annakili in 1976. His move to other south Indian languages started with the Telugu film Bhadrakali, also in 1977 (a remake of a Tamil film by the same name), and then with Kannada film Maathu Tappada Maga and Malayalam film Vyamoham, both in 1978. The world-renowned music composing giant, A R Rahman, debuted in 1992 with two films—Roja, in Tamil, and Yoddha, in Malayalam. In 1994, he worked on two Telugu films. By 1995, he had debuted in Hindi with Rangeela.

That India’s southern states are more prosperous, developed and liberal compared to their northern counterparts has been well-documented. In fact, in some human development indices, South India is closer to Europe. The rise of digital music streaming platforms is making apparent another comparison between South India and Europe: they’re both significantly multilingual. One in four Europeans is trilingual. South India has always been multilingual. But now, thanks to the rise of music streaming services backed by mobile platforms, affordable 4G and powerful discovery algorithms, South India’s multilingualism is changing the way its citizens listen to music. Traditionally, Indians have stuck to listening to songs in their mother tongue, and perhaps, Hindi, due to Bollywood’s outsized influence. Even when given viable options to seek music in multiple languages, we shun ‘alien’ languages even if they are from our neighboring states and stick to the familiar. Or so has been the trend.

As a format, the playlist is what we used to discover new music for a very long time, going back to the 60s, 70s, 80s and 90s. The primary method then for disseminating the playlists was through radio, and then, TV. Today’s playlists—and the platforms through which they spread— though, are something else. Let’s take a look at Apple Music’s “Genius” playlists for starters. Say you start with ‘Tere Bina’ from A R Rahman’s Guru, Genius suggests a Tamil song next—’Oru Deivam Thandha Poove’, from Kannathil Muthamittal. Why? Common factors—singer Chinmayi Sripada, and A R Rahman (besides Mani Ratnam). It could then take you to Chinmayi’s Telugu, Kannada and even Marathi songs. By changing one variable at a time–singers, composers, films, actors, and finally, languages–algorithmic playlists can immerse us in music we may never have heard.

Beyond music and playlists though, there are some other significant factors at play for this multicultural assimilation. Subtitled films, for instance. Chennai, as the film industry capital of South India, has always had select theatres releasing movies in Telugu, Kannada and Malayalam, catering only to people who know the language. It was a smaller audience in Hyderabad, for non-Telugu (and non-Hindi) films, and even smaller audience for non-Kannada films in Bengaluru. But things have changed rapidly. Today, theatre chains like PVR are releasing many films with subtitles in English. Sometimes even for English films to bridge the gap between accents. This opens films to a much wider audience. It’s normal to expect a new Malayalam film to have English subtitles when it releases in a Bengaluru or a Mumbai. Similarly, OTT platforms like Netflix, Hotstar and Amazon Prime have subtitle options for most regional language films, dramatically expanding their audience base. Given the relative affinity between the various cultures, and hence languages, within the South have, it is reasonable to expect people consuming films from each other’s states and regions, thanks to subtitles.

To be sure, language continues to be an integral part of each state’s identity in the South. But it is also more actively peddled for political and administrative reasons, than cultural ones. The language becomes the first weapon in the hands of lumpen elements to initiate a riot when things are on the boil—like the Cauvery water issue between Tamil Nadu and Karnataka. So, ‘Tamil’ association is targeted in Bengaluru, as a token expression of the anger—Adyar Ananda Bhavan outlets, for instance. The ‘Thiruvalluvar’ statue in Ulsoor is given police protection for the same reason. And assorted groups suddenly sprout and seek a ban on Baahubali 2 in Karnataka because one Tamilian member (actor Sathyaraj, who plays the iconic Kattappa) of its massive cast had opinions that are pro-Tamil Nadu. Language continues to be used as a wedge by those in power. But if films are considered as the predominant art form—which they sure are, down South—then linguistic differences seem to be reducing and merging at the common point of ‘South India’. And technology is playing an interesting role in that merger.

4) What makes merchants adopt digital payments? [Source: Livemint ]
In this piece, Badal Malick (principal innovation officer at Catalyst) and Rajesh Shukla (MD and CEO at People’s Research on India’s Consumer Economy [PRICE]) discuss about digital payments. Digital payments form the bedrock of deeper financial integration for micro enterprises, which constitutes 99% of India’s approximately 60 million-strong micro, small and medium enterprises (MSMEs). Broader financial services, such as credit, insurance and wealth management, can be contextually and cost-effectively provided in digitized and personalized formats on top of digital transaction footprints. Such access to affordable finance can translate to financial stability and growth for business owners that are otherwise vulnerable to cash flow volatility and suffer from constrained access to capital to grow. And this can have a profound impact on job creation, economic growth and quality of life for hundreds of millions.

There are notable supply-side initiatives to promote electronic payments, such as the setting up of public infrastructure platforms like the India Stack. We now have interoperable and efficient payment systems such as Bhim-UPI (unified payments interface), which are becoming more reliable as they mature. It is hoped that such transactions will only become safer with the much anticipated user consent-based mechanisms to govern commercial use of data. Despite these ambitious initiatives, however, last-mile barriers are still writ large. Behavioral factors, weak economics and low product relevancy limit usage on the ground. For entrepreneurs and retailers who have creatively coped with cash for centuries, digital money poses an economic threat to their informal businesses and, ultimately perhaps, to their very survival. And digital propositions that provide immediate, tangible value and adequate levels of trust to small businesses are simply elusive.

Around 2,500 small businesses of different kinds in Jaipur were surveyed to investigate potential barriers and opportunities for merchant adoption of digital payments. The result was a staggering diversity across the micro-business landscape, which can be instrumental in developing tailored solutions. The fundamental divide lies between merchants with investments in fixed establishments versus the longer tail of home-based businesses, street and roving vendors, and individual service providers. The former tend to be formally registered, higher educated and operate at a larger scale. They are early adopters of digital payment solutions, with 42% having tried and 35% using popular solutions like wallets and internet banking. In contrast, the latter category of merchants is largely informal, illiterate and operates on a smaller scale, showing 2-7% adoption rates. They also have much lower access to banking, smartphones and the internet, and have little awareness and understanding of digital payment solutions, as well as lower overall business confidence.

Interestingly, these businesses have significant cash footprint and demonstrate pain points around customer collections, need for working capital and the inability to save in large amounts, all of which can be addressed through appropriate digital financial solutions. Even within these broad categories, there is variation in business and social context. Businesses with higher transaction size and turnover show greater tendency to adopt. Some businesses—for example, wholesale, convenience or specialty retail shops—also tend to have different transaction contexts and customer profiles. Illustratively, in the sample used, only 13% of the dairy booth merchants had adopted digital payments versus 53% of the apparel and footwear merchants.

The study also underscores the need for an ecosystem approach, recognizing that merchants don’t make isolated adoption decisions. They factor in the preferences and constraints of their transaction counterparties, namely consumers and suppliers. Around 55% of fixed-store merchants reported lack of customer demand for digital payments as a primary reason for non-adoption; for long-tail categories, lack of awareness was by far the major obstacle. For those that saw business benefits of digital payments, the prospect of new customers and higher sales per customer were primary motivators as well. A majority of non-adopting fixed stores also indicated that they would use digital if asked to do so by their suppliers, presenting an opportunity to digitise supply chains leveraging new goods and services tax (GST) and payments (e.g., UPI) infrastructure. In short, effective merchant digitisation strategies need to address local ecosystems of customers, suppliers and, perhaps, also get additional stakeholders, such as employers, local governments, and intermediary agencies like non-governmental organisations (NGOs), on board.

While much of the ecosystem focuses on the cost of cash as a rationale to go digital, it was found that merchants across the board perceive little or no cost in cash transactions, which can be settled bilaterally and are anonymous. Less than 1% of the merchants reported any cash being stolen in the past year, and experienced no significant cash handling or reconciliation concerns. While there are certainly large efficiencies to be had across the other parts of the payment value chain (e.g., cash processing and logistics costs borne by banks), these are unlikely to be internalized by small merchants, especially given counterweighing factors like tax arbitrage and cash-to-digital transitional costs. The learning suggests that to galvanise merchant digital payments at scale, there can be no “one size fits all” template. A niche and verticalised innovation approach, wherein solutions are customised to specific micro-segments, use cases and ecosystems, will prove more fruitful. Second, the digital value proposition needs to shift from operational efficiency to immediately realizable top-line benefits for the business. To do this, digital payments should be embedded in broader business processes that can be comprehensively digitised.

5) Yuval Noah Harari: The idea of free information is extremely dangerous [Source: The Guardian ]
In this interview, Yuval Noah Harari, an Israeli historian who has written two bestsellers: 1) Sapiens, which examined the course of early human history; and 2) Homo Deus, which speculated on where we might be heading as a post-human species, talks about free information, change and his latest book. His new book, 21 Lessons for the 21st Century, is an exploration of the difficulties that confront us at the present. Now that he is a highly successful public intellectual, upon asking in what ways international recognition has changed him, he says he has much less time now. He’s travelling around the world and going to conferences and giving interviews, basically repeating what he thinks he already knows, and having less and less time to research new stuff. Just a few years ago he was an anonymous professor of history specializing in medieval history and his audience was about five people around the world who read his articles. So it’s quite shocking for him to be now in a position that he writes something and there is a potential of millions of people will read it. Overall he is happy with what’s happened.

Upon asking why liberalism is under particular threat from big data, he says, “Liberalism is based on the assumption that you have privileged access to your own inner world of feelings and thoughts and choices, and nobody outside you can really understand you. This is why your feelings are the highest authority in your life and also in politics and economics – the voter knows best, the customer is always right. Even though neuroscience shows us that there is no such thing as free will, in practical terms it made sense because nobody could understand and manipulate your innermost feelings. But now the merger of biotech and infotech in neuroscience and the ability to gather enormous amounts of data on each individual and process them effectively means we are very close to the point where an external system can understand your feelings better than you. We’ve already seen a glimpse of it in the last epidemic of fake news. There’s always been fake news but what’s different this time is that you can tailor the story to particular individuals, because you know the prejudice of this particular individual. The more people believe in free will, that their feelings represent some mystical spiritual capacity, the easier it is to manipulate them, because they won’t think that their feelings are being produced and manipulated by some external system.”

On his writing, Mr. Harari feels that readers still misunderstand him quite a lot. Sometimes it’s because they don’t really want to understand. Sometimes it’s because many of the issues are new and complicated. He doesn’t think reading a single book can clarify all these issues. It is the responsibility of scientists, certainly when they speak to the general public, to speak as clearly as possible. But he’s under no illusions that everyone will understand what he writes in the same way as he intends to. Also, on good information being free, he thinks the idea of free information is extremely dangerous when it comes to the news industry. If there’s so much free information out there, how do you get people’s attention? This becomes the real commodity. At present there is an incentive in order to get your attention – and then sell it to advertisers and politicians and so forth – to create more and more sensational stories, irrespective of truth or relevance. Some of the fake news comes from manipulation by Russian hackers but much of it is simply because of the wrong incentive structure. There is no penalty for creating a sensational story that is not true. We’re willing to pay for high quality food and clothes and cars, so why not high quality information?

Mr. Harari also feels that we’ll have to wait and see whether humans are built to withstand such rapid rates of change. He doubts whether we have the psychological resilience to sustain such a level of change. The rate of change has been accelerating for the past two centuries. His grandmother is 93 and she is OK. Whether we can do it again, there is no guarantee. We must invest more resources in the psychological resilience of people. Talking about meditation and the role that it plays in his life, Mr. Harari says that it’s a way to understand reality – about himself first of all and then reality about the rest of the world, without any stories and fictions and mythologies. Just to observe what is really happening. The most important question for him is how to tell the difference between fiction and reality, and that’s why meditation is such an important part of his life. His last chapter in the book is more personal because it’s about meditation. He was worried that people would think he is saying that meditation will solve all the problems. It can help people cope with stress but it’s definitely not the silver bullet that will save humankind from all its problems.

6) China ecommerce boom fires up logistics sector [Source: Financial Times ]
China’s ecommerce giants are fighting it out over everything from customer data to exclusive contracts with retailers. Now that rivalry is spilling offline into logistics networks and warehousing, with key operators spending millions of dollars to secure prime warehouse locations to shave precious hours off delivery times.  “The warehousing and logistics sector is really following growth in consumption,” said Stuart Ross, head of industrial at JLL in China. “Chinese consumers have taken online consumption to the greatest level in the world.” China is projected to have 52m square metres of high-quality warehousing space by the end of this year, according to JLL — though a fraction of the US’s nearly 900m sq m that was entirely built up in just 15 years, according to Mr. Ross. Efficient networks around warehousing hubs were crucial to processing the 40bn parcels the state postal service said were delivered in China last year.

The warehousing demand has enriched third-party logistics operators such as Best Logistics, one of Alibaba’s key partners, and courier delivery company SF Express. Revenue for third-party logistics providers was $159bn in 2015, three times that in 2007, according to JLL. In 2016, local businesses spent Rmb11.1tn ($1.6tn) on logistics, with a third of that going to storage alone. Transport accounts for 40-50% of the cost of logistics, so reducing the distance from warehouse to consumer is crucial, says Victor Mok, a co-president at GLP, China’s largest warehousing operator, which manages about 30m sq m of space in the country. Whichever player can connect all the data and make the whole flow from customer to supply chain to logistics will have the best opportunity to create the most efficient network.

GLP so far has focused on China’s biggest cities — Beijing, Shanghai and Shenzhen — but logistics operators increasingly are following online consumption into smaller, inland locales. Investment in warehouses has slowed, though, as big cities have begun limiting the amount of land allotted for industrial use to control urban sprawl. Investment peaked in 2015 with a jump of 28 per cent from the year before, slowing to 5 per cent in 2016 and just 4 per cent in 2017. In the past two years, six key Chinese cities including Beijing, Guangzhou and Shanghai have shortened land leases for warehouses from 50 to 30 years and slashed the percentage of land allocated to industrial purposes. In contrast, some inland cities such as Wuhan are dealing with warehousing oversupply.

As it has grown, the logistics warehouse sector has attracted private equity, insurance companies and sovereign wealth funds seeking stable returns. Most recently GLP was taken private for $11.6bn by a consortium that included Hopu and Hillhouse Capital, and set up a Rmb10bn warehouse fund with China Life.“ In last five years or so, there has been more than $25bn of investment with a focus on the logistics sector,” said Mr. Ross. “We’re really at an apex point now where logistics is the hottest real-estate sector in the country.”

7) Journalists’ deaths highlight Russia’s moves into Africa [Source: Financial Times ]
The author of this piece notes that the team of Russian journalists who flew into the Central African Republic last month were on a mission to investigate Moscow’s growing role in one of the world’s poorest nations. Days after arriving, the three men were murdered by unknown assailants. Their local driver told CAR authorities that they were killed at a roadside checkpoint by turban-wearing men speaking Arabic or a similar language. While the killings are still being investigated, the case highlights Russia’s increasing presence in the CAR, a country that has become a staging point for Moscow’s latest geopolitical ambition — a push into Africa.

An influential backer of communism across Africa for decades, after the collapse of the Soviet Union Moscow ceded influence to western rivals. More recently, China has made huge inroads, investing $220bn in 2014 alone. Now Russia’s move into the CAR — and in several other African nations — suggests a new willingness to re-engage and catch up for lost time. So far this year Russia has struck military co-operation deals with the Democratic Republic of Congo, Ethiopia, Guinea and Mozambique. Others, including Nigeria and Angola, have agreed to buy arms from Moscow or are working with Russia to exploit mineral deposits.

Russia’s involvement in the CAR began in December when a team of military instructors and 170 “civilian advisers” arrived in Bangui to train the country’s army and presidential guard. Nine weapons shipments have arrived in the CAR capital since. Though Faustin-Archange Touadéra, CAR president, has restored some semblance of government since taking power in 2016, 80 per cent of the country is still controlled by more than a dozen rebel groups. After meeting Russia’s President Vladimir Putin in St Petersburg in June, Mr Touadéra expressed hopes for “more active co-operation”. His national security adviser is a Russian and Russians have formed part of his presidential guard.

The three murdered men, all freelance journalists, travelled to the CAR as part of a story for an investigative news outlet financed by Mikhail Khodorkovsky, a one-time Russian oligarch turned fierce critic of the Kremlin. The publication says the reporters’ aim was to visit a gold mine in a rebel-held area they believed was operated by a company owned by Evgeny Prigozhin, a prominent Russian businessman. Mr Prigozhin, known as “Putin’s chef” for owning a company that provides the catering for lavish Kremlin banquets, was indicted in the US this year for allegedly running an online “troll farm” that aims to sway voters in US elections. He is also reported by independent Russian media to have links to Wagner, the main private military contractor for the Russian army.

8) Air pollution: Why London struggles to breathe [Source: Financial Times ]
Although London’s air often appears clear to the naked eye, the city has suffered from illegal levels of air pollution since 2010, with particularly dangerous levels of nitrogen dioxide, which comes mainly from diesel vehicles. This summer’s unusually hot and sunny weather has caused surges in ozone — produced when sunlight reacts with nitrogen dioxide — that have prompted multiple pollution warnings. While cities such as Beijing or New Delhi usually attract more headlines, the stubborn air pollution in London shows just how intractable the problem can be. Under some measures, such as extremely small air particles, the smog in New Delhi and Beijing is much worse than London. But in terms of nitrogen dioxide, which inflames lungs and is linked to shorter life expectancy, London is nearly as bad as the Chinese and Indian capitals — and much worse than other developed cities such as New York or Madrid.

This is despite dramatic shifts in transport policy with increased cycling and a congestion charge helping to reduce the number of vehicles on the roads in central London by 25% in the past decade. Yet despite its pioneering schemes, road works, cycle lanes and the rise of private hire vehicles has slowed traffic to a crawl. Shirley Rodrigues, London’s deputy mayor, says the city has reached a “tipping point” in terms of taking action. “It’s not only [because of] the thousands of deaths brought on early, but also the pernicious, chronic illnesses that are costing the health service a lot of money,” she says. “It is affecting quality of life.” This urgency has been compounded by a series of lawsuits in which judges ruled the government was not doing enough to comply with the EU’s legally binding air pollution limits.

To understand how London’s air got so bad in the first place, look no further than Upper Thames Street, which stretches from London Bridge toward Blackfriars, near the riverbank. As fitness-minded runners jog by, a stream of slow-moving traffic, mostly lorries and vans delivering to the city, stops and starts ahead of a set of traffic lights. At an office building on the corner of Thames Street and Cousin Lane, the vials and tubes of the monitoring station protrude from an entrance. The data they gather show the highest pollution in all of London, with nitrogen dioxide levels exceeding critical levels more than 120 times last year. (The legal limit is 18 times a year.) The City of London, the traditional financial district which is distinct from the Greater London Authority that covers the entire metropolis, is home to two of the five worst hotspots on this measure.

When London missed the binding air quality EU limits that came into force in 2010, it was largely due to diesel vehicles, because they emitted higher levels of nitrogen dioxide in the real world than in lab tests. The legacy of diesel, initially billed as a cleaner fuel because it produces less carbon dioxide, has plagued other European capitals such as Madrid and Paris. In London, congestion has compounded the effect of the diesel fumes. Traffic speeds in central London average eight miles per hour on weekdays — a figure that has decreased in recent years. Although the number of total vehicles entering central London has fallen by about 30% since the congestion charge was introduced, the number of private hire vehicles entering central London — where they are exempt from the charge — has more than quadrupled over the same period. The stop-and-go nature of congested traffic exacerbates vehicle emissions, which are often highest when a vehicle is accelerating.

“We are sitting on a bit of a health time bomb here,” says Caroline Russell, a member of the London Assembly for Britain’s Green party. “We really need to be making sure people see how much better our lives could be if we had a less car-dependent transport system.” Brexit could present a further challenge for London’s fight to clear its air, because EU laws have until now provided the strictest air quality standards that the UK is obliged to meet. Last month, a clean air bill was introduced in the House of Lords that would make clean air a human right, and mandate that air quality be taken into consideration with all new government policies.

9) Against the tyranny of majority [Source: The Economist ]
By the age of six, John Stuart Mill had written a history of Rome. By seven, he was devouring Plato in Greek. “This looks like bragging,” his father James told a friend when the boy was eight; “John is now an adept in the first six books of Euclid and in Algebra.” The hot-housing that began at the younger Mill’s birth in 1806 yielded its intended result: a prodigy with a profound faith in the power of reason. He became the leading exponent of the philosophy of liberalism, formulating ideas about economics and democracy that shaped the political debates of the 19th century. Many today see Mill as an avatar for the ruthless capitalism of his era. Henry Adams, an American historian, referred to Mill as “his Satanic free-trade majesty”. In the few surviving photos of him, he looks somewhat cold and unfeeling. He wasn’t. True, in his early years Mill was a dyed-in-the-wool utilitarian. His mentor was Jeremy Bentham, who had argued that the principle underlying all social activity ought to be “the greatest happiness of the greatest number”.

Like Gradgrind in Charles Dickens’s “Hard Times”, Mill initially followed Bentham in seeing humans as mere calculating machines. In his brilliant autobiography, published after his death in 1873, he confided that he grew up “in the absence of love and in the presence of fear”. The result was a breakdown in his early 20s. He turned to the poetry of William Wordsworth and Samuel Taylor Coleridge, which taught him about beauty, honour and loyalty. On many issues it is difficult to pigeonhole his stance, or even to pin down exactly what he believes. His views evolved over the course of his life, but for most of it he rejected absolutes and recognised the world’s mess and complexity. John Gray, a philosopher, writes that Mill was “an eclectic and transitional thinker whose writings cannot be expected to yield a coherent doctrine.” Above all, though, like all liberals Mill believed in the power of individual thought. His first big work, “A System of Logic”, argues that humanity’s greatest weakness is its tendency to delude itself as to the veracity of unexamined convictions. He renounced shibboleths, orthodoxies and received wisdom: anything that stopped people thinking for themselves.

As Richard Reeves’s biography makes clear, Mill thought the coming industrial, democratic age could enable human flourishing in some ways, but hinder it in others. Take free trade, for which he was an enthusiast (despite working for a long time for the East India Company, perhaps the world’s biggest-ever monopoly). He thought free trade increased productivity: “Whatever causes a greater quantity of anything to be produced in the same place, tends to the general increase of the productive powers of the world,” he wrote in “Principles of Political Economy”. He criticized the Corn Laws, tariffs which largely benefited holders of agricultural land. Yet Mill was even more taken by the philosophical argument for free trade. “It is hardly possible to overrate the value, in the present low state of human improvement, of placing human beings in contact with persons dissimilar to themselves, and with modes of thought and action unlike those with which they are familiar.” This applied to everyone: “there is no nation which does not need to borrow from others.” He practiced what he preached, spending a lot of time in France and seeing himself as a sort of interlocutor between the revolutionary passion of French politics and the buttoned-down gradualism of England.

As democracy spread, he anticipated, ideas would clash. He supported the Reform Act of 1832, which, as well as extending the franchise, did away with “rotten boroughs”, constituencies with tiny electorates, often controlled by a single person. He praised France’s move in 1848 to institute universal male suffrage. Each voter’s views would be represented—and each would have reason to be informed. Participation in collective decision-making was for Mill part of the good life. For the same reason he was an early proponent of votes for women. “I consider [sex] to be as entirely irrelevant to political rights as difference in height or in the colour of the hair,” he wrote in “Considerations on Representative Government”. After becoming an MP in 1865, he presented a petition calling for female suffrage.

Mill believed that society was advancing. But he also foresaw threats. Capitalism had flaws; democracy had an alarming tendency to undermine itself. He pondered how to counter the tyrannical tendencies inherent in economic and political liberalism. Experts had a vital role to play, he thought. Progress required people with the time and inclination for serious study—a secular clergy, of sorts. It had a utilitarian justification: its members would devise “rules that would maximise human well-being if we all followed them,” as Alan Ryan, a political theorist, puts it. One solution was to give educated voters greater power. In this dispensation, people who could not read or write, or who had received the 19th-century equivalent of welfare benefits, would not get a vote. University graduates might get six votes, unskilled workers one. The aim was to give those who had thought deeply about the world more say. The lower orders would be reminded that they required political and moral guidance, though in time more of them would join the ranks of the educated.

He might well argue that, before 2016, liberal thought had succumbed to a tyranny of conformity. Until recently there was little talk in liberal society about the “left behind” or the losers from free trade. Many liberals had fallen into a decidedly unMillian complacency—assuming that all the big arguments had been settled. No longer. Mr. Trump’s victory has prompted liberals to revisit the case for everything from free trade to immigration. Brexit has led to a lively debate about the proper locus of power. And universities have become a battleground over the limits of free speech. Like Mill’s, these are disorienting times—urgently requiring the intellectual flexibility and boldness epitomised by the father of liberalism.

10) Something is fishy in the state of Goa [Source: Livemint ]
For the natives of India’s smallest state, Goa, the most preferred greeting between friends and acquaintances has traditionally been “what fish are you cooking today?” But, all of a sudden on 12 July, things became considerably more complicated. The state Food and Drug Administration conducted spot checks for formalin (a chemical reduction of highly carcinogenic formaldehyde, used as a preservative in laboratories and morgues) in shipments of fish from other Indian states at the wholesale market near Margao in South Goa. The results were positive, and 17 truckloads were impounded. Immediately, irate fish traders across the state suspended operations in protest. Overnight, the visibly harried FDA Director Jyoti Sardesai reversed her agency’s original position, saying “as a precautionary move, we instructed fish vendors to not distribute till detailed laboratory reports were available. The results showed that the presence of formalin was within permissible limits. The fish is safe for consumption.” Literally within minutes of this deeply dubious statement becoming public, social media erupted with anger and ridicule.

From New York, where she runs the Goes-Gomes Lab at Columbia University (with her husband Joaquim Goes), the distinguished biological oceanographer Helga do Rosario Gomes wrote a devastating public letter that said, “Formalin is a recognized carcinogen and health hazard by agencies like the American Occupational Safety and Health Administration (OSHA), National Toxicology Program, The International Agency for Research on Cancer (IARC), the Environmental Protection Agency (EPA) and National Cancer Institute all of who constantly monitor its airborne concentrations and toxicity. Their major concern is for industrial workers, doctors, technicians and mortuary employees who can possibly inhale it or come in contact with it during the course of their work. But a regular fish eater eating a sample laden with formalin? That is almost unheard of unless you are at the mercy of a despicable and unscrupulous fish industry probably aided and abetted by an equally monstrous and treacherous government.” Formalin in fish is just one glaring symptom of a system gone irredeemably rogue.

At the centre of the festering mess is the paramount Goan politician of the 21st century, the original IIT-derived “common man,” Manohar Parrikar. When he came into the legislature, the state politics were a national joke, with 13 separate administrations in power until 2002. Parrikar brought stability, and in 2009 presciently cast his lot behind Narendra Modi. Parrikar’s heavily touted closeness to Modi makes him unassailable in Goa, even as his party’s spectacular mandate from 2012 disappeared in the state elections in 2017. The BJP won only 13 seats while the Congress won 17, but he was controversially returned to office, after accommodating a number of ambitious rivals in his new cabinet. Since then the veteran politician has not been able to control his fractious colleagues, partly due to absences caused by a thinly-veiled secret medical condition that most recently required him to spend three months earlier this year at the Memorial Sloane Kettering Cancer Centre in New York. The collective wisdom in Goa is that the strongman of state politics is compromised and vulnerable, as most painfully illustrated by the open warfare that has broken out between his ministers over the formalin issue.

The Cambridge-educated marine biologist, Aaron Lobo says, “we should NOT be eating sea fish in the monsoon months. It’s obvious it is far from “fresh”. To cater to demand traders can go to any lengths including lacing fish with preservatives such as formalin. But we have better options. I have fishermen from my village, who supply me with their fresh catch who I can be sure are not lacing it with preservatives. As a rule of thumb for my food I rely more on people and less on labels.”

-Prashant Mittal is Strategist, at Ambit Capital. Views expressed are personal

Show More
Post Your Comment
Required, will not be published
All comments are moderated
Wabco India: Brake point
Social media regulation: Content control vs. Platform nudging