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Arguing that governments can pick winners, Professor Chang urges us to reclaim economic planning, not as a token of centrally-planned communism, but rather as the simple reality behind our market economies today:

Capitalist economies are in large part planned. Governments in capitalist economies practice planning too, albeit on a more limited basis than under communist central planning. All of them finance a significant share of investment in R&D and infrastructure. Most of them plan a significant chunk of the economy through the planning of the activities of state-owned enterprises. Many capitalist governments plan the future shape of individual industrial sectors through sectoral industrial policy or even that of the national economy through indicative planning. More importantly, modern capitalist economies are made up of large, hierarchical corporations that plan their activities in great detail, even across national borders. Therefore, the question is not whether you plan or not. It is about planning the right things at the right levels.

Drawing a clear distinction between communist central planning and capitalist 'indicative' planning, Chang notes that the latter: ... involves the government ... setting some broad targets concerning key economic variables (e.g., investments in strategic industries, infrastructure development, exports) and working with, not against, the private sector to achieve them. Unlike under central planning, these targets are not legally binding; hence the adjective 'indicative'. However, the government will do its best to achieve them by mobilizing various carrots (e.g., subsidies, granting of monopoly rights) and sticks (e.g., regulations, influence through state-owned banks) at its disposal.

Chang observes that: France had great success in promoting investment and technological innovation through indicative planning in the 1950s and 60s, thereby overtaking the British economy as Europe's second industrial power. Other European countries, such as Finland, Norway and Austria, also successfully used indicative planning to upgrade their economies between the 1950s and the 1970s. The East Asian miracle economies of Japan, Korea and Taiwan used indicative planning too between the 1950s and 1980s. This is not to say that all indicative planning exercises have been successful; in India, for example, it has not. Nevertheless, the European and East Asian examples show that planning in certain forms is not incompatible with capitalism and may even promote capitalist development very well.

As we have argued before, the current crisis raging through Europe (in large part caused by free-market economics), forces us to reconsider our economic options. More than ever before, now is the time to rehabilitate indicative planning and industrial policy as key levers in our arsenal of policy tools.

Within Japan, it’s the NSC (Nuclear Safety Commission) that has responsibility for classifying its incidents. When they say Fukushima is a 7, it doesn’t necessarily mean the same thing as what the USSR considered to be a 7 in 1986. Why not? Because there are many different aspects to a nuclear incident. There are health effects, potential health effects, environmental effects, measurements of radiation released, and so on.

The scale boils all these factors down to a single number, which to me, is a misguided effort: 0 – No safety significance 1 – Anomaly 2 – Incident 3 – Serious incident 4 – Accident with local consequences 5 – Accident with wider consequences 6 – Serious accident 7 – Major accident I certainly agree that Fukushima is a 7, a major accident, considering its type of reactor. Chernobyl was a Generation 0 atomic pile, not really what you’d call a nuclear reactor, and I’m surprised it didn’t blow up half the continent.  For a proper nuclear reactor, I think Fukushima is about as bad as things can get.

But notice, it does not fulfill some of the qualifications of a 7, or even of a 4. For example, people start dying from radiation as early as 4 on the scale. Nobody has died from radiation at Fukushima (three were killed by the tsunami), and nobody was hurt at all at Three Mile Island which was a 5. The grimmest rational estimates of Chernobyl put its eventual death toll from cancer at 4,000. But it does fulfill the other qualifications of a 7; notably: Major release of radioactive material with widespread health and environmental effects requiring implementation of planned and extended countermeasures.

Students are supposed to be engaging with the big ideas in society. It might be how to make a nuclear bomb in physics, or it might be the rationale for using the nuclear bomb against Japan in history. If university is not about these difficult and challenging ideas, then it really is nothing more than a finishing school to equip us with the correct skills for the workplace. If free education, an issue close to the heart of many students, is about anything, it should be about the freedom to explore ideas. The truth is that the greatest impediment to getting a free education is not the fees but the NUS’s policies which effectively keep students wrapped in cotton wool.

ery soon, we won’t be able to tell our reality from virtual reality. Eguchi Aimi looks pretty darn real to me, and if AKB48 and Glico had managed to pull off the ruse without anyone catching on, would they have continued using her in other promotional materials? At this rate of technological advancement, it won’t be ten years before we can see an entire movie made up of CGI characters looking like they real actors. And then what, synthetic life forms which look and behave exactly like us?