Enterprise Resilience Management Blog

A Step Forward for Electric Cars

The New York Times published an article by John Markoff discussing a new venture to establish a network of "service stations" for electric cars ["Reimagining the Automobile Industry by Selling the Electricity." 29 October 2007]. The implication is that some very serious investors see a bright future for "all-electric" cars.

"Shai Agassi, a Silicon Valley technologist who was in competition to become chief executive of SAP, one of the world's largest software companies, has re-emerged with a grand plan to reinvent the world’s automobile industry around battery-powered all-electric cars. Others are developing green cars, like the Tesla and Chevrolet Volt. However, Mr. Agassi is not planning to make cars, but instead wants to deploy an infrastructure of battery-charging stations in the United States, Europe and the developing world. The new system will sell electric fuel on a subscription basis and will subsidize vehicle costs through leases and credits. 'We're basically saying this is just like the cellular phone model,' he said. 'If you think of Tesla as the iPhone, we're AT&T.' ... He plans to announce in New York City that he has raised $200 million from private venture partners."

Agassi is betting that governments will begin to look seriously at reducing carbon emissions and that consumers will jump on the "green" movement. Those are pretty big bets; but with oil nearing $100 a barrel and gasoline prices in the U.S. expected to hit $3/gallon later this year he may be right.

"In an interview Thursday, Mr. Agassi said tests of prototype vehicles would start in early 2008 and the company would begin commercial sales and service in two years. He said he was working to obtain commitments from both governments and carmakers. ... He said his approach was a radical departure from other electric-car ventures that relied on advances in battery technology, which have come slowly."

Agassi has a good track record, which is why venture capitalists seem willing to risk their money on his latest venture. The biggest challenge, I believe, will be convincing consumers, especially in the U.S., that all-electric cars will fill their transportation needs. The problem with past all-electric cars is that they have had limited driving ranges and then took considerable time to recharge before they were again available for service. For any long-distance trip, this arrangement was simply unacceptable. Although those drawbacks haven't really changed, Agassi believes he can overcome them.

"He plans to extend the existing electric-power grids with a wide network of intelligent recharging stations in urban areas and supplementing it with a smaller number of automated battery-replacement stations. ... The new venture, which Mr. Agassi has named, for now, Better Place, would be viable even with existing lithium-ion battery technology, he said. The economics will be more compelling in Europe, where gasoline is roughly twice as expensive as in the United States, he said. Assuming a life span of 1,500 battery recharges, he said that the energy cost of all-electric cars would be about 7 cents a mile. That would be less than a third of the cost of driving a gasoline-powered car today. 'It's much easier to transport electrons than octane molecules,' he said. 'We've already got a grid that goes around the entire world; all we have to do is extend it.' Mr. Agassi envisions tens of thousands of recharging spots that will adjust for both cost and use patterns. For example, a group of parking-lot chargers at a workplace might recharge a visitor's car before a regular employee’s car parked for the entire day. The system will also supplement recharging stations that require about one minute of recharge time for every minute of driving, with a smaller number of car-wash-style stations for swapping batteries. This would make it possible for a driver to go to a station rather than wait to recharge a battery, he said."

The battery charging option doesn't sound very attractive. Driving a couple of hours and then waiting a couple of hours for a recharge simply doesn't seem efficient. For those that take only short trips, the system might work. But most of those people are likely to be commuters who will recharge their cars at home. The article doesn't indicate how long a battery change would take, but I venture it will take longer than filling a tank with gasoline. Agassi is right that the all-electric car has the advantage of already having electrical grids in place to service them. Proponents of hydrogen technology still face the daunting challenge of constructing a hydrogen distribution network should that technology mature enough to be put into broad use.

If Agassi's venture takes off and the use of all-electric cars becomes widespread, it will stress an already strained power generation sector. Analysts already predict that generation capacity will not keep pace with demand. Economic sectors are so interconnected that a blip in one area is generally reflected in other areas as well. This will certainly be true if Agassi's vision becomes a money-making reality.

Internecine Challenges in Kurdistan

In a couple of previous posts, I discussed the deteriorating security situation along the Turkey/Iraq border in the Kurdistan region because of PKK rebels who live in and launch attacks from that region [Despite Advances, Kurdistan Sits in Shaky Neighborhood and The Kurdish Situation Intensifies]. In those posts, I noted how important getting a handle on the PKK challenge is to the Kurdish region's future. I also noted that "getting a handle on the PKK" is easier said than done. Not only are Iraqi Kurds hesitant to deal harshly with other ethnic Kurds, but they face the same challenge that everyone who has fought with the Kurds has faced -- the mountains. The old saying that "the Kurds have no friends but the mountains" is certainly true for the PKK. An article in the New York Times focuses on why routing the PKK rebels is a challenge even for the Kurdistan Regional Government ["In the Rugged North of Iraq, Kurdish Rebels Flout Turkey," by Sabrina Tavernise, 29 October 2007]. Tavernise notes that despite intense international pressure, the PKK rebels operate with relative freedom.

"A low-slung concrete building off a steep mountain road marks the beginning of rebel territory in this remote corner of northern Iraq. The fighters based here, Kurdish militants fighting Turkey, fly their own flag, and despite urgent international calls to curb them, they operate freely, receiving supplies in beat-up pickup trucks less than 10 miles from a government checkpoint. 'Our condition is good,' said one fighter, putting a heaping spoonful of sugar into his steaming tea. 'How about yours?' A giant face of the rebels' leader — Abdullah Ocalan, now in a Turkish prison — has been painted on a nearby slope. The rebel group, the Kurdistan Workers' Party, or P.K.K., is at the center of a crisis between Turkey and Iraq that began when the group’s fighters killed 12 Turkish soldiers on Oct. 21, prompting Turkey, a NATO member, to threaten an invasion. But the P.K.K. continues to operate casually here, in full view of Iraqi authorities. The P.K.K.'s impunity is rooted in the complex web of relationships and ambitions that began with the American-led invasion of Iraq more than four years ago, and has frustrated others with an interest in resolving the crisis — the Turks, Iraqis and the Bush administration."

Sitting between the mountains and Baghdad, the Kurdistan Regional Government is truly between the proverbial rock and a hard place. But its dilemma, as I have explained, is as much about history and ethnic ties as it is about geography. KRG leaders are reluctant to act against the PKK because such actions would divert funds from development and direct precious resources against ethnic Kurds whose aspirations they understand.

"Kurdish political leaders seem ... in no hurry to act. An all-out battle is out of the question, they argue, because the rugged terrain makes it impossible to dislodge them [the PKK]. 'Closing the camps means war and fighting,' said Azad Jindyany, a senior Kurdish official in Sulaimaniya, a regional capital. 'We don't have the army to do that. We did it in the past, and we failed.' But even logistical flows remain uninterrupted, despite the fact that Iraqi Kurdish leaders have some of the most precise and extensive intelligence networks in the country. As the war has worsened, the United States has come to depend increasingly on the Kurds as partners in running Iraq and as overseers of the one part of the country where some of their original aspirations are actually being met. Iraqi Kurdish officials, for their part, appear to be politely ignoring American calls for action, saying the only serious solution is political, not military. They have taken their own path, allowing the guerrillas to exist on their territory, while at the same time quietly trying to persuade them to stop attacks."

Some pundits believe that if the KRG really wanted to rout the rebels they could.

"'They have allowed the P.K.K. to be up there,' said Mark Parris, a former American ambassador to Turkey who is now at the Brookings Institution. 'That couldn't have happened without their permitting them to be there. That's their turf. It's as simple as that.'"

This laissez-faire attitude by the KRG has created angst for the United States, which views both Turkey and the KRG as allies.

"The situation poses a puzzle to the United States, which badly wants to avert a new front in the war, but finds itself forced to choose between two trusted allies — Turkey, a NATO member whose territory is the transit area for most of its air cargo to Iraq, and the Kurds, their closest partners in Iraq. The United States 'is like a man with two wives,' said one Iraqi Kurd in Sulaimaniya. 'They quarrel, but he doesn’t want to lose either of them.'"

This "Big Love" situation is making things tense all around and most of the pressure is being felt in Kurdistan, where leaders would prefer the situation to be settled through negotiation. PKK actions are ensuring that won't happen.

"The P.K.K. wants an autonomous Kurdish area in eastern Turkey, and has repeatedly attacked the Turkish military, and sometimes the civilian population, since the 1980s, in a conflict that has left more than 30,000 dead. In this small town [Raniya] a short drive from the edge of rebel territory, and in Sulaimaniya, 55 miles to the south, it is business as usual. A political party affiliated with the rebel group is open and holding meetings. Pickup trucks zip in and out of the group’s territory, and a government checkpoint a short drive away from the area acts as a friendly tour guide. Its soldiers said they had waved through eight cars of journalists on one day last week. Mala Bakhtyar, a senior member in the Patriotic Union of Kurdistan, the party that governs this northeastern region, said there had been no explicit orders from Baghdad to limit the P.K.K., and scoffed at last week's statement by the Iraqi prime minister, Nuri Kamal al-Maliki, that Iraq would close the P.K.K.'s offices, saying they had already been shut long ago. 'They are guests, but they are making their living by themselves,' Mr. Bakhtyar said. 'We don't support them.' He added: 'We don't agree with them. We don't like to make a fight with Turkey.'"

For their part, PKK leaders believe the KRG likes having an armed group in the mountainous border region.

"Fayeq Mohamed Goppy, a leader in the Kurdistan Democratic Solution Party, an offshoot of the P.K.K. that still operates freely, argues that Iraqi Kurdish leaders are only paying lip service to wanting the P.K.K. to leave. In reality, the politicians want the separatists around as protection against Sunni Arab extremists, who most Iraqi Kurds believe will move in if the P.K.K. leaves the mountains. Noshirwan Mustafa, a prominent Kurdish leader, said the area was as impenetrable as the mountains in Pakistan where leaders of Al Qaeda and the Taliban are thought to be hiding. 'For me, the P.K.K. is better than the Taliban,' he said. Local Kurdish authorities have asked Mr. Goppy to keep a low profile, including canceling a planned conference in Erbil, he said, but otherwise have not limited his activities."

Tavernise goes on to explain that many Kurds believe they have a tenuous hold in the area and that the PKK provides them with more firepower to ensure they maintain control there. I find that argument specious since conflict with Turkey poses a greater risk to survival than other perceived threats. Turkey is the threat knocking on the door, not the threat over the horizon. A more understandable argument is that the KRG is using the PKK as a bargaining chip with Turkey; but that is a dangerous game.

"Mr. Parris argues that the Kurdish leader of northern Iraq, Massoud Barzani, ever astute, is holding onto the P.K.K. as a future bargaining chip with Turkey, and will not use it until he absolutely has to. 'The single most important piece of negotiating capital may very well be his ability to take care of the P.K.K.,' he said."

Recent events would seem to undermine arguments that the KRG has the "ability to take care of the PKK." Some local leaders offer that they would be happy to see the PKK go.

"Mr. Jindyany said local authorities would be happy to get rid of them if they could, calling the situation a sword of Damocles for Iraqi Kurds. Throughout its history in northern Iraq, which dates back to the early 1980s, under an agreement with Mr. Barzani, the P.K.K. has had contentious relations with Iraqi Kurdish leaders. It fought in their civil wars, against Mr. Barzani in 1997, and three years later, against Jalal Talabani, a powerful Kurd who is now the president of Iraq. But since the American invasion in 2003, the political landscape has changed. Iraqi Kurds, emboldened by their secure position, have stopped fighting each other and turned their attentions to other threats like Turkey, a state that has long oppressed its Kurdish population, and Islamic extremism from Baghdad. This area of northern Iraq, which Iraqis call Kurdistan, in some ways eclipsed the P.K.K.'s struggle for an autonomous Kurdish area, Iraqi Kurds said."

The other problem for KRG is that while they may want to see the PKK go, the rebel group has many local supporters.

"Public sympathy in Raniya and Sulaimaniya is enormous, and the fighters procure supplies and health care here with ease. Fighters do not go to hospitals, for fear of standing out — the ones from Turkey speak a different Kurdish dialect — but are treated in doctors' homes, said one former fighter, an Iraqi Kurd who was recruited at age 14. 'Their organization is everywhere,' said the fighter, who now works as a police officer for the main political party, after surrendering to local authorities in 2003. 'Their members are everywhere.' To Iraqi Kurds, Turkey's approach is pure politics. There is no military solution to the problem of the P.K.K., they say, because the terrain would never permit victory, and Turkey’s leaders know that. The solution, Mr. Mustafa argued, lies with moderates in Turkey, who must push for an amnesty for the rebels. Militant Kurds, for their part, should take advantage of the political opening in Turkey — 20 Kurdish deputies are now serving in Parliament there. 'When you have the door to the Parliament open, why are you going to the caves?' he said."

With winter snows approaching, analysts expect the next few months to remain quiet. The hope is that the negotiating process will go forward during this lull in fighting and that a political solution can be found. That would certainly be the best course for the KRG, which doesn't want to funnel money away from development and into conflict.

Africa and the Digital Divide

I have occasionally written about efforts to connect African countries to the Internet (see, for example, Update on Wiring Rwanda to the World]. In that post, I cited an article that indicated the African continent had made little headway in connecting to the world via the World Wide Web. The Economist updates the situation in Africa and reports that little has changed ["The Digital Gap," 20 October 2007 print edition].

"When it comes to computing power, the gap between Africa and the broadband world is still a Grand Canyon. Only 4% of Africans have access to the internet. They pay the most in the world, around $250-300 a month, for the slowest connection speeds. E-commerce barely exists. Nigeria's 140m-odd people have but a few hundred decently trafficked websites in their domain. Blogging is a vibrant but peripheral activity. If sub-Saharan Africa were scaled according to its available internet connectivity, it would be about the size of Ireland."

As I've discussed Enterra Solutions' Development-in-a-Box™ framework, I've noted that there are some pre-conditions that help give it a better chance of succeeding. One of those pre-conditions is reasonable connectivity to the rest of the world. Development-in-a-Box is based on the belief that countries will develop faster and with a stronger economic base when they interact with the global economy. The fact that "e-commerce barely exists" throughout much of the African continent means that most countries there have a long ways to go. Development, of course, varies even among the largely disconnected group of African nations.

"Of its 48 countries, the 28 in central and eastern Africa are connected to the web by only the flimsiest of satellite technology. Apart from the occasional internet hook-up at a diamond mine or UN camp, whole regions of Congo and Sudan, sub-Saharan Africa's two largest countries, have no connection at all. Even countries like Uganda, which are go-ahead about the internet, start from a very low base. Research by Microsoft found only one in 200 Ugandans regularly uses e-mail. The number is higher in west Africa, where the more robust SAT-3 undersea cable provides for higher speeds and lower costs. The Eastern Africa Submarine Cable System, better known as EASSY, which runs 9,900km (6,152 miles) along the Indian Ocean floor from South Africa to Sudan, is meant to speed up connections in east and central Africa in the next few years but is not yet operating. African users must also cope with obsolete systems, irregular electricity and a stultifying lack of local content. Interfaces are being written in a number of African languages, but even the clearest instructions in Wolof or Yoruba as to how to use Windows presume a fair degree of literacy. Then there is the high graphical content of the rich world's web: videos and social networking are unworkable in the snail-slow dial-up offered in most African internet cafés."

The sad plight of these states underscores why pre-conditions are necessary to foster success. In addition to basic high-speed connectivity, countries require things like good governance (little corruption), an educated and healthy populace, a reliable source of electrical power, and basic transportation infrastructure. All of these are sorely lacking in many of Africa's poorest countries. One of the things that governments have traditionally overseen is the construction of critical infrastructure (whether done by the government or by a group provided with monopolistic authority). The Economist reports that many African countries simply abandoned this traditional role, leaving the continent in the dark (both figuratively and literally). Because these countries didn't use (or worse) abused their monopolistic powers, if they didn't run infrastructure sectors, they ran them into the ground.

"All of this would be worse for Africans if state telecom monopolies had kept their grip. But fortunately they have been cast aside by leaner and more transparent mobile-phone companies, which the World Bank says may have poured $25 billion into Africa in the past ten years. The continent remains an enormous investment prospect, not least in internet offerings."

There are a number of nation-states (like India) that are looking to form public/private partnerships in order to develop the infrastructure that the government can't afford to build on its own. The benefit of such partnerships is that the private sector is less likely to allow the public sector to undermine infrastructure projects because of corruption. If there isn't a bottom line (that is, a profit to be made), the private sector is not going to stay the course. As my colleague Tom Barnett is fond of saying, "Foreign direct investment is a coward." It will always flee to safer areas where a return on investment is more certain. Public/private partnerships could help Africa, but not many have emerged.

"A UN call in 2005 for 'digital solidarity' has so far amounted to little. A big conference called Africa Connect, to be held in Rwanda later this month, is meant to give a boost. It says it will be 'pure business', not charity. African governments will face pressure, from the World Bank and the African Development Bank among others, to slash red tape and encourage technology firms in the hope of cutting the cost of going online by two-thirds and getting ministries, hospitals and schools onto the internet by 2012."

Other projects, such as One Laptop Per Child, are poised to take advantage of connectivity once it is available. It's not just health, education, and government that stand to benefit. Every sector will benefit once connectivity is available at an affordable rate. Business, however, will be the sector that benefits most. The Development-in-a-Box framework will then be able to help more fully both governments and businesses take advantage of opportunities afforded by the global economy. 

Algorithms and Business

We all like to believe that adding the human touch to decision making is important. Business schools pride themselves are being able to educate students to become better business leaders. But some decisions actually fair worse because people get involved. Let me give you an example. Dutch sociology professor, Chris Snijders of the Eindhoven University of Technology has developed algorithms that permit computers to make routine managerial decisions based on past data. Snijders is so confident that his algorithms can do a better job than humans in making routine decisions that in 2005 he issued a challenge to any company that believes otherwise. Snijders ran experiments for two years using computer and software acquisition decisions made by purchasing managers at more than 300 organizations. When Snijders’ computer models were given the same tasks, they achieved better results in categories like timeliness of delivery, adherence to the budget and accuracy of specifications. Although I don't believe that any company has taken on Snijders’ challenge, his work hasn’t been completely ignored. The legal department of a Dutch insurance company is using his expertise to evaluate a computer decision model it has designed to automate the routing of new cases.

An article discussing Snijders’ work notes that it builds on previous experiments that have demonstrated that mathematical models are better than humans in making a number of predictions including the success or failure of start-up businesses, criminal recidivism of parolees, and student performance in graduate school ["Maybe We Should Leave That Up to the Computers," by Douglas Heingartner, New York Times, 18 July 2006]. Computers also trump humans, the article reports, when making medical diagnoses and picking dogs at the racetrack. Computers are also making inroads in the insurance and investment businesses. The reason that mathematical models are better than humans is that humans are generally less consistent than computer models.

The article made the point that embedded business logic allows organizations "to codify and centralize its hard-won knowledge in a concrete and easily transferable form, so it stays put when the experts move on. Models also can teach newcomers, in part by explaining the individual steps that lead to a given choice. They are also faster than people, are immune to fatigue and give the human experts more time to work on other tasks beyond the current scope of machines." The Economist recently published an article about the pervasiveness of algorithms throughout the business world ["Business by numbers," 15 September 2007 print edition].

"Algorithms sound scary, of interest only to dome-headed mathematicians. In fact they have become the instruction manuals for a host of routine consumer transactions. Browse for a book on Amazon.com and algorithms generate recommendations for other titles to buy. Buy a copy and they help a logistics firm to decide on the best delivery route. Ring to check your order's progress and more algorithms spring into action to determine the quickest connection to and through a call-centre. From analysing credit-card transactions to deciding how to stack supermarket shelves, algorithms now underpin a large amount of everyday life. Their pervasiveness reflects the application of novel computing power to the age-old complexities of business. 'No human being can work fast enough to process all the data available at a certain scale,' says Mike Lynch, boss of Autonomy, a computing firm that uses algorithms to make sense of unstructured data. Algorithms can. As the amount of data on everything from shopping habits to media consumption increases and as customers choose more personalisation, algorithms will only become more important. Algorithms can take many forms. At its core, an algorithm is a step-by-step method for doing a job."

This subject interests me, of course, because I founded my company, Enterra Solutions, based on the belief that automating business processes was essential to making companies more competitive in a globalized world. 

"This formulaic style of thinking can itself be a useful tool for businesses, much like the rigour of good project-management. But computers have made algorithms far more valuable to companies. 'A computer program is a written encoding of an algorithm,' explains Andrew Herbert, who runs Microsoft Research in Cambridge, Britain. The speed and processing power of computers mean that algorithms can execute tasks with blinding speed using vast amounts of data. Some of these tasks are more mechanistic than others. For instance, people often make mistakes when they key in their credit-card numbers online. With millions of transactions being processed at a time, a rapid way to weed out invalid numbers helps to keep processing times down."

The article goes on to talk about an algorithm developed by Hans Luhn, an IBM researcher, that almost instantaneously validates whether the numbers on a credit card are genuine. If they are, the processing can go ahead.

"The Luhn algorithm performs a simple calculation. But the real power of algorithms emerges when they are put to work on much more complex problems. As far as most businesses are concerned, these problems typically fall into two types: improving various processes, such as how a network is configured and a supply chain is run, or analysing data on things such as customer spending."

The article explains how critical algorithms are for large companies like UPS who utilize a so-called "traveling salesman" algorithm.

"UPS uses algorithms to help deliver the millions of packages that pass through its transportation network every day in the most efficient way possible. The simplest routes are easy to draw up. If a driver has only three destinations to visit, he can take only six possible routes. But the number of possible routes explodes as the destinations increase. There are more than 15 trillion, trillion possible routes to take on a journey with just 25 drop-off points—and an average day for a UPS driver in America involves 150 destinations. The picture is further complicated by constraints such as specified drop-off and pick-up times for drivers or runway lengths and noise restrictions for aircraft. 'Algorithms provide benefits when the choices are so great that they are impossible to process in your head,' says UPS's Jack Levis. Solving this 'travelling-salesman problem' means a lot to UPS. For its fleet of aircraft in America, the company uses an algorithm called VOLCANO (which stands for Volume, Location and Aircraft Network Optimiser). Developed jointly with the Massachusetts Institute of Technology (MIT), it is used by three different planning groups within UPS—one to plan schedules for the following four to six months, one to work out what kind of facilities and aircraft might be needed over the next two to ten years, and one to plan for the peak season between Thanksgiving and Christmas. Getting the scheduling wrong imposes a heavy cost: flying half-empty planes or leasing extra aircraft is an expensive business. UPS reckons that VOLCANO has saved the company tens of millions of dollars since its introduction in 2000."

Such optimization algorithms are used by a number of other sectors as well. The telecommunications industry uses algorithms to route calls through their networks. Call centers use algorithms to assign incoming calls to operators based on the nature of the questions being asked and the workloads of the operators.

"The most powerful algorithms are those that cope with continual changes. The delivery schedules for online grocers have huge 'feedback loops' in which the delivery times chosen by customers affect the routes that vans take, which in turn affects the choice of delivery slots made available to customers. UPS is working on a real-time algorithm for its drivers that can recalibrate the order of deliveries on the fly, in much the same way that satellite-navigation systems in cars adjust themselves if a driver chooses to ignore a suggested route. In the world of the internet, operators are looking at ways of marrying up the algorithms that find the shortest path through a network and those that control the speed with which information flows. At the moment, the routing algorithm does not talk to the flow-control algorithm, which means paths do not change even when there is congestion. According to Marc Wennink, a researcher at Britain's BT, combining the algorithms would mean that tasks such as downloading files could become much more resilient to network disruption. It would also allow BT to make better use of its existing network capacity."

The article notes that, in addition to optimization algorithms, statistical algorithms play an important role in business.

"Just as optimisation algorithms come in handy when people are swamped by vast numbers of permutations, so statistical algorithms help firms to grapple with complex datasets. Dunnhumby, a data-analysis firm, uses algorithms to crunch data on customer behaviour for a number of clients. Its best-known customer (and majority-owner) is Tesco, a British supermarket with a Clubcard loyalty-card scheme that generates a mind-numbing flow of data on the purchases of 13m members across 55,000 product lines. To make sense of it all, Dunnhumby's analysts cooked up an algorithm called the rolling ball. It works by assigning attributes to each of the products on Tesco's shelves. These range from easy-to-cook to value-for-money, from adventurous to fresh. In order to give ratings for every dimension of a product, the rolling-ball algorithm starts at the extremes: ostrich burgers, say, would count as very adventurous. The algorithm then trawls through Tesco's purchasing data to see what other products (staples such as milk and bread aside) tend to wind up in the same shopping baskets as ostrich burgers do. Products that are strongly associated will score more highly on the adventurousness scale. As the associations between products become progressively weaker on one dimension, they start to get stronger on another. The ball has rolled from one attribute to another. With every product categorised and graded across every attribute, Dunnhumby is able to segment and cluster Tesco's customers based on what they buy."

The article notes that anyone surfing the Internet depends algorithms. The competition between search engines like Google, Yahoo, MSN.com, Ask.com and so forth is a competition about algorithms and which one produces the best search results. Finally, the article implies that in the information age the business with the best algorithms is going to succeed. According to expert quoted in the article, algorithms "are bound to take over the world." Sounds good for business!

Freedom of the Press Around the World

Some of the topics I routinely try to address, like development and connectivity, can only be fully achieved in places there is a reasonable amount of freedom of the press. Some people believe the press has too much power. They like to point out that with dozens of humanitarian relief operations going on at any moment the one that gets the most attention by the press is the one that normally gets the most resources (the so-called "CNN effect"). In the U.S., liberals like to carp about the right wing bias of Fox News and most radio talk shows while the conservatives rant about the liberal bias of the print media (like the New York Times). Love 'em or hate 'em, however, news sources are essential in helping expose political corruption, humanitarian need, and so forth. Tyrants try to control the press and, thus, control what those under their iron-fisted rule see and hear. Reporters Without Borders just released their latest Worldwide Press Freedom Index detailing its perception of where countries rank when it comes to freedom of the press. Traditionally the Index looked primarily at mainstream sources of news, but with the rise of the World Wide Web, it now also looks at how bloggers are treated ["Crackdowns On Bloggers Increasing, Survey Finds," by Nora Boustany, Washington Post, 17 October 2007].

"Government repression in some countries has shifted from journalists to bloggers, with the vitality of the Internet triggering a more focused crackdown as blogs increasingly take the place of mainstream news media, according to Lucie Morillon, Washington director of the advocacy group Reporters Without Borders. 'Countries that were not sentencing journalists to prison terms anymore have been doing it these last months for bloggers. This is the case in Egypt and Jordan,' she said yesterday as the group released its sixth annual Worldwide Press Freedom Index. Egypt ranked 146th and Jordan 122nd in press freedom among the 169 countries for which data were available."

If you question the importance of blogs as a source of news and commentary, take the case of Iran. If the Mullahs had their way, they would control all access to information. They repress dissent in every possible way from passing laws to sending out thugs as morality police to harrass or assault so-called offenders. As a result, blogs have become a major source of news and political expression. According to Nasrin Alavi, author of the interesting volume We Are Iran, "Farsi is the fourth most frequently used language for keeping on-line journals. There are more Iranian blogs than there are Spanish, German, Italian, Chinese or Russian. According to the 2004 NITLE Blog Census, there are more than 64,000 blogs written in Farsi. A phenomenal figure, given that in neighboring countries such as Iraq there are fewer than 50 known bloggers." The Index confirms, Boustany reports, what most of us know intuitively -- democracies have more freedom of the press.

"Reporters Without Borders said major industrialized countries, including the United States, made slight progress, moving up several notches, with the exception of Russia. Iceland topped the list for press freedom in the survey, and Eritrea ranked last. While not all press freedom violations were known in the countries ranked second and third from the bottom -- North Korea and Turkmenistan -- 'Eritrea deserves to be at the bottom,' the group said. Eritrean President Isaias Afwerki has banished privately owned press outlets and jailed the few journalists who have dared criticize the government, it said. 'We know that four of them have died in detention and we have every reason to fear that others will suffer the same fate,' the group added. Most democracies improved their ranking, with the United States moving up to 48th place from last year's 53rd, Morillon said."

America's ranking at 48 sounds pretty low for a country that enshrines freedom of the press in its Bill of Rights. Here's why the U.S. ranked so low:

"The reason the United States did not make the top 30 is because videographer and blogger Josh Wolf spent almost eight months in jail for not turning over video footage of a demonstration in San Francisco and because the confidentiality of sources is under continued attack, she said. Cameraman Sami al-Hajj, from al-Jazeera satellite television, is still being held without charges at the U.S. detention facility at Guantanamo Bay, Cuba, and journalist Chauncey Bailey was killed in Oakland, Calif., after his coverage made him a target."

Although it could be better, the U.S. ranking is not as bad as it sounds. There are less than 14 points separating the U.S. from the Iceland at the top of the list, whereas there are more than 100 points separating the U.S. from Eritrea at the bottom of the Index. According to Boustany, the only region that has been spared from censorship or violence against reporters is Europe. Although freedom of the press is difficult to find at the Edges of Globalization where I'm trying to implement Enterra Solutions' Development-in-a-Box™ framework, encouraging more openness is essential to its success. Connectivity is a critical for helping emerging market countries attract foreign direct investment. Eliminating corruption is also important. A free press demonstrates an effort is being made in both areas.

Globalization, IT, and Innovation

In a Special Report on innovation, the Economist looked at "how globalization and information technology are spurring faster innovation." ["Revving up," 13-19 October 2007 print edition]. The article began by discussing motorcycles manufactured in China.

"China now makes half the world's motorcycles. But more important than the numbers produced is the way these motorcycles are made—especially the way designers, suppliers and manufacturers have organised themselves into a dynamic and entrepreneurial network. Unlike state-run firms, the city's private-sector upstarts, such as Longxin and Zongshen, do not have big foreign partners like Honda or Suzuki with deep pockets and proven designs. So they came up with a different business model, one that was simpler and more flexible. Instead of dictating every detail of the parts they want from their suppliers, the motorcycle-makers specify only the important features, like size and weight, and let outside designers improvise. This so-called 'localised modularisation' approach has been very successful and delivered big cost reductions and quality improvements, says John Seely Brown, an innovation expert who used to head the legendary Xerox PARC research centre. It is one example of the sort of business-model innovation which he insists is far more radical than conventional product or process innovation."

China's President Hu Jintao has openly announced his intentions to make China a leader in innovation not just manufacturing. According the Economist article, China may be well on its way.

"Examples of these business-model innovations are now bubbling up from developing economies to threaten the established global giants. In a report with John Hagel, of Deloitte, a consultancy, Mr Seely Brown argues that the activity of private entrepreneurs means 'China is rapidly emerging as the global centre of management innovation, pioneering management techniques that most US companies are struggling to understand.' The emergence of Asian world-beaters exemplifies the two forces driving innovation. Globalisation and the spread of information technology allow the creation of unexpected and disruptive business models, like the one used by Chongqing's motorcycle-makers."

The key, according to the article, is taking advantage of the flexibility provided by nimble supply chains and loose alliances that are made possible by new information technologies. These innovations are happening all over Asia.

"Other examples include the design networks established by Taiwanese contract-producers in the textile industry. Groups of innovative just-in-time suppliers abound in Asia, feeding Western fashion and consumer-goods companies. They are often managed by supply-chain experts, like Hong Kong's Li & Fung. Unlike Japan's keiretsu, which bound companies and their suppliers together with interlocking shareholdings, these firms are free to leave their alliances. They stay together only if they continue to learn and profit from the experience. In some ways they resemble the nimble networks of firms that underpinned Silicon Valley's success."

As a result of these innovative practices and processes, emerging market companies are moving up the corporate food chain. Once defined by an abundance of cheap labor, successful emerging market countries like China and India are moving beyond the "low cost country" label and rapidly becoming mainstream suppliers of innovative products and services.

"Low labour costs may have given such firms a head start, but that is a transitory advantage. India's software innovators were once sniffed at as merely low-cost offshoring and back-office operations. But firms like Infosys, Wipro and Tata Consultancy Services (TCS) have become world leaders in business-software services. S. Ramadorai, TCS's chief executive, says his firm sees 'innovation as a key enabler of its productivity edge'. He points out that his firm has been investing in R&D for 25 years and holds several dozen patents and copyrights. Navi Radjou of Forrester Research, a technology consultancy, applauds TCS's 'global innovation ecosystem' which brings together academic labs, start-ups, venture-capital firms, large independent software firms and some of its most important customers."

I have frequently argued, as has my colleague Tom Barnett, that connectivity makes surprising, and mostly positive, things happen. In our Development-in-a-Box™ work, we look to connect local businesses with suppliers and customers and we ensure that those connections are welcomed by stakeholders in the global economy by embedding international standards and best practices within the connection processes. The power of networks is being discovered and taken advantage of in most market sectors.

For example, "Innovation is also changing the pharmaceuticals industry. Small biotechnology firms, using networked approaches, are getting ahead of Big Pharma. This too opens the way for Asian competitors, like Ranbaxy and Dr Reddy's Laboratories. These firms were once copycats, trampling on Western patents to make cheap generic versions of drugs. But increasingly they are shifting to process innovation and even new drug discovery."

Plato noted, "A need or problem encourages creative efforts to meet the need or solve the problem." We more often hear, "Necessity is the mother of invention." The same is true for innovation.

"Innovation can arise out of necessity. Entrepreneurs in China must compete with privileged state firms with access to cheap credit as well as the local arms of multinationals. That makes China's 'third sector', as Messrs Seely Brown and Hagel call it, extraordinarily resourceful in trying to reach global markets."

The article points out that in India the initial drive to connect was not external but internal.

"India has been less integrated into the world economy, so many of its innovative firms have initially concentrated on reaching 'bottom of the pyramid' consumers. For instance, Selco, an Indian solar-energy pioneer, found that because many of its customers were living in remote areas, it had to set up local networks of trained technicians to sell, install and repair its products, and provide customers with small loans."

In many ways, connecting internally in poor countries is more difficult than connecting externally. Networks between organizations and people are the only networks changing the face of manufacturing. For years, for example, new aircraft have been flying networks -- so called "fly by wire" airplanes. Lots of companies and their products are becoming "fly by wire" entities according to the Economist.

"The effects of the growing knowledge-component of innovation have become increasingly clear in heavy engineering. Reinhold Achatz, of Siemens, claims the German giant has undergone a hidden electronics revolution. 'We have more software developers than Oracle or SAP, but you don't see this because it is embedded in our trains, machine tools and factory automation,' he says. Mr Achatz calculates that as much as 60% of his firm's sales now involve software. Some 90% of the development in machine tools is in electronics and related hardware, and the figure is similar for cars. A BMW, he says, is 'now actually a network of computers.' That may seem like an exaggeration until you step into the sleek new Hydrogen 7 BMW saloon. Push the pedal to the metal on the autobahn and the car responds as every BMW should; cylinders growling enthusiastically as the ultimate driving machine races past slower vehicles. But this car is not like any other made by BMW. Press a button on the steering wheel and it seamlessly switches from burning petrol to hydrogen. The key to this advance, says Ulrich Weinmann, of BMW, is smart software. Electronics have been in cars for decades, but those were isolated 'dumb systems', he adds. Now cars are crammed full of networks of computers with smart software controlling and monitoring things. New BMWs can even synchronise with Apple's iPhone, and download maps and directions from Google while you drive."

The article concludes that the center of innovation may well move from the West to the East.

"Robert Lutz, GM's head of product development, says investment in and enthusiasm for clean technologies in Asia is so great that cars powered by fuel cells (squeaky-clean devices that use hydrogen to make electricity) are likely to take off in China before they do in the United States. There is reason to believe he might be right. Just as villagers in Africa and Bangladesh have gone straight from no phones to mobile phones, developing countries could leapfrog with other innovations. Developing countries already have higher levels of 'early stage' entrepreneurship, with more people engaged in things such as starting new ventures—often because the necessity for doing so is greater. Tim Jones of Innovaro, a European innovation consultancy, points out that Africa is about to take the lead in using mobile phones for payments and remittances, thanks to the introduction of schemes like the M-PESA money-transfer service introduced by Vodafone and Citigroup in Kenya. These allow people to send money using text messages. Some people reckon that, as the nature of innovation changes, so it is speeding up. ... Many executives feel the heat is on and that they must innovate faster just to stand still. One reason is that product cycles are undeniably getting shorter. ... Perhaps managers at firms everywhere should be both far-sighted and paranoid in equal measure as they scan the horizon for unexpected competitive threats. Some companies are trying to organise themselves with management techniques to face just such a disruptive future."

As I've visited places that I describe as the Edges of Globalization, I have felt the vibrations of the entrepreneurial spirit thriving there. The Economist article simply confirms that opportunities exist everywhere, but in order to exploit them people and companies need to connect.

The Kurdish Situation Intensifies

Last week I noted in a post that think are getting tense between Turkey and Iraq (more specifically the Kurdish region of northern Iraq) because of cross border incursion by the Kurdish Workers' Party (PKK), a group that has been declared a terrorist organization by Turkey, the United States, and the European Union [Despites Advances, Kurdistan Sits in Shaky Neighborhood]. I wrote: "It's clear that something must be done. The U.S. certainly wouldn't tolerate such attacks without taking action and the Turks are aware of that; thus, the cries of double standards [from Turkish politicians]."  Even Jon Stewart, on The Daily Show, took notice of the growing tensions between Turkey and Kurdistan. Given his political bent, Stewart then showed a series of clips highlighting President Bush proclaiming that everyone (except, Stewart guessed, Turkey) the right to defend themselves against terrorists. The point I made in the last post on the subject was that Iraqi Kurdistan is caught between a rock and a hard place in trying to deal with the PKK as is the U.S.

The U.S. is desperate to see the economic boom taking place in northern Iraq continue and spread. It knows that the one sure path to stopping it is conflict. As a result, it appears to be applying the double standard noted by Turkey and Stewart. The Kurdistan Regional Government is also determined to foster continued economic growth and realize that good relations with Turkey is essential to that effort. It's also clear that they have no where near the influence over the PKK (who are Turkish not Iraqi Kurds) as the Turkish government thinks. Last week the Turkish parliament authorized cross border military operations into northern Iraq to deal with the situation. That action caused an outcry from the international community as well as from Iraq. The Turks insisted that it was within Iraq's (primarily meaning the KRG's) power to stop such interventions by taking care of the PKK enclaves within Iraq.

Over the weekend, things turned from bad to worse when the PKK mounted another cross border operation that ended up killing 17 Turkish soldiers ["Kurds from Iraq Kill 17 Soldiers in Turkey," by Amit R. Paley, Washington Post, 22 October 2007].

"An audacious cross-border ambush by Kurdish rebels based in northern Iraq killed at least 17 Turkish soldiers Sunday, ratcheting up pressure on the Turkish government to launch a military offensive into Iraq. ... The raid on Turkish soldiers, among the deadliest attacks in recent memory, was carried out by the Kurdistan Workers' Party, known by its Kurdish initials PKK. The armed group aims to create an independent Kurdish state out of parts of eastern Turkey, northern Iraq and western Iran. Turkish officials said 16 soldiers were also wounded in the fighting in Hakkari province, which borders Iraq. Thirty-two Kurdish fighters were killed in subsequent clashes and 10 Turkish troops were still missing, they said."

Throwing gasoline on the fire, the PKK spokesman indicated they saw and opportunity and took it.

"Abdul Rahman al-Chaderchi, a PKK spokesman, said the Kurdish fighters attacked because Turkish troops were conducting war games late Saturday near the border. He said that the death toll was higher than Turkey reported and that several soldiers were being held prisoner, but he declined to provide precise numbers. 'They tried to enter the Iraqi lands," Chaderchi said. "But our fighters have confronted them.' Senior Turkish military and government officials held emergency meetings Sunday night to decide on a response."

The Iraqi government was quick to condemn the PKK attacks, but the Turkish government once again reiterated that the Iraqi and KRG governments must do something quickly and effectively or they would mount an effort to deal with the problem itself.

"'Turkey does not have designs on Iraq's territory,' Turkish President Abdullah Gul said after the attacks, according to the Anatolian news agency. 'However, if Iraq keeps harboring terrorists, Turkey has the right to destroy this.' At a news conference hours after the ambush, Iraqi President Jalal Talabani, who is Kurdish, ordered the guerrilla fighters to stop their attacks or leave Iraq. 'We are against all the actions that are done by the PKK,' he said. 'And we will not support the PKK. We want the best relations with Turkey.' But he added: 'The Turkish army with all its capabilities couldn't arrest the leaders of the PKK. So how could we do that? It's a dream that cannot be reached.' Turkey continued to shell the area along the northern Iraqi border late Sunday, residents and officials said. Some villagers reported that the pesh merga, the military force of the Kurdish regional government in northern Iraq, was moving toward the border."

Whether the pesh merga are moving to deal with the PKK or the Turks is unclear -- hopefully, the former. The Bush administration quickly condemned the PKK attacks and called them unacceptable.

"Massoud Barzani, president of the Kurdish regional government, also condemned the attack but warned against a Turkish offensive into northern Iraq. 'If this struggle touches the Kurdistan region, then we will defend our citizens,' he said."

Anyway you look at it, the attack and subsequent rhetoric has moved the situation closer to conflict. One problem is that Iraqi Kurds are starting to view the Turks, not the PKK, as source of the problem.

"Iraqi residents of the border area braced for more of the violence that has destroyed parts of their villages and forced some of them to flee. Sabiha Khalil, 54, a widowed farmer from the village of Spindar, said the fighting reminded her of the days of Saddam Hussein, when a government campaign killed as many as 180,000 Kurds and drove many more from their homes. 'Now Turkey is taking Saddam Hussein's place,' she said. 'We were displaced from our village for 10 years, but we have rebuilt our homes and rehabilitated our farms. Now where should we go?' Suleiman Hamid, 33, a farmer who also lives in Spindar, said shelling on Sunday destroyed several houses and caused his children to wake up screaming. Many of his neighbors have fled, he said. 'I don't understand why the Turks are bombing us,' he said. 'There is no PKK here. Is their main goal to target the PKK, or just any Kurds?'"

In order to cool the situation down, leaders in the region need to remain focused on the immediate challenges and not permit the rhetoric to push the situation further in the wrong direction. There is much to lose on all sides if the situation escalates into open conflict. Despite past rhetoric, cooler heads have prevailed to date.

Countries' Commitment to Global Development Measured

The Center for Global Development recently released its 2007 Commitment to Development Index (CDI). According to the Center's web site, the "CDI assigns points in seven policy areas: aid (both quantity as a share of income and quality), trade, investment, migration, environment, security, and technology (click to enlarge the attached image). Within each component, a country receives points for policies and actions that support poor nations in their efforts to build prosperity, good government, and security. The seven components are averaged for a final score. The scoring adjusts for size in order to discern how much countries are living up to their potential to help." On this basis, the Netherlands scores highest and the United States ranks fourteenth. Nora Boustany, writing for the Washington Post, reports on the release of the Index ["U.S. Ranks 14th In Annual Index of Foreign Aid," 11 October 2007].

"Because of massive assistance to Iraq and Afghanistan in recent years and initiatives to fight HIV and AIDS, the United States and Britain have provided more foreign aid to developing nations than ever before, according to David Roodman, a research fellow at the Washington-based Center for Global Development. But total amounts are not everything. According to this year's Commitment to Development Index, compiled by averaging measures in seven policy areas, the Netherlands comes first and Japan last in the 21 countries included in the study. Britain ranks ninth, and the United States is 14th."

In determining Index rankings, the author reports that some aid is heavily discounted.

"Roodman is the author of the study, which factors in performance on aid, trade, investment, the environment, security, technology and migration. Moral obligation and security concerns are the obvious motivations for developed countries such as the United States and Britain to give aid, but the index is not a simple measure of funds. 'U.S. aid to Iraq was $10 billion in 2005, the last year for which we have data. That is one of the largest country-to-country aid flows ever,' Roodman said. But 'the CDI only counts that aid at 10 cents on the dollar because of high corruption and weak rule of law.' Beyond the quantity of aid, the index penalizes donors for giving assistance to rich or corrupt governments or tying aid to the purchase of their own goods, which limits recipients' ability to shop around for the lowest price."

The web site permits you examine individual nation scores more closely. The attached images show the scores for The Netherlands and for the United States. As you can see, there is a significant difference in where each country scores best in the Index. The Netherlands, for example, scores extremely high in the provision of foreign aid and also high in investment. It scores lower, however, in trade, migration, and technology. The profile for the United States looks quite different. The United States scores highest in trade, investment, and security, and much lower in foreign aid. The high scores in security and investment come as no surprise considering all that the U.S. is doing in Iraq and Afghanistan. Boustany points out that two prominent nations are missing in the Index -- China and India.

"Roodman said China is normally not included in the index because of its low per-capita annual income -- $1,595 compared with America's $38,165 at the official exchange rate. India is also not included in the regular index. This year, Roodman said, he wanted to focus on the environment and looked at China and India just in that one category. In terms of gas emissions that cause global warming, one American's emissions are equivalent to those of four Chinese or nine Indians."

Another area of interest was trade.

"On trade, the study said the system of rules governing world trade has acted as a barrier to some of the goods that poor countries are best at producing. William R. Cline, a senior fellow at the Center for Global Development, is quoted in the study as saying that if rich countries removed remaining trade barriers, it would lift 200 million people out of poverty."

Since trade and investment are much more important than aid in helping bring countries out of poverty, one shouldn't make too much of the fact that the U.S. scores low in the aid area since it scores high in trade and investment. Those are also areas that Enterra Solutions' Development-in-a-Box™ framework targets and the reason that I found the CDI so interesting. I also found one other thing interesting considering a recent blog I wrote about Growing Demographic Tensions. That post talked about growing racial tensions in Switzerland and how immigrants are spurring political reactions there. In the CDI, however, Switzerland ranks second in migration among nations included in the index. As I noted in my post on demographics, Switzerland does have a large immigrant population -- the current political climate and racial tensions apparently didn't affect its rating. Japan, another country discussed in the blog, ranks next to last. For those interested in development, the CDI is an interesting snapshot of how various countries view the challenge and how they believe they can best address it. The CDI is like a development fingerprint for the nations included in the study.

Despite Advances, Kurdistan Sits in Shaky Neighborhood

I have written a number of posts about Kurdistan and my trips there. These posts have been mostly positive and have discussed the economic boom that taking place there thanks to the relatively secure environment the Kurdistan Regional Government (KRG) has managed to achieve. Nevertheless, I have also referred to the area as the Edges of Globalization, meaning that just beyond the relative calm there remains risks to economic development. That was never clearer than yesterday when the Turkish parliament overwhelming authorized the government to send troops into northern Iraq ["Turkey Authorizes Iraq Incursion," by Molly Moore, Washington Post, 18 October 2007].

"The Turkish parliament on Wednesday overwhelmingly authorized cross-border military attacks in northern Iraq against Kurdish separatist rebels, as world leaders pleaded for restraint. Lawmakers voted 507 to 19 to give Prime Minister Recep Tayyip Erdogan permission to order strategic strikes or large-scale invasions of Iraq for a one-year period. Erdogan has said he will not order an immediate attack. ... Only the small, pro-Kurdish Democratic Society Party opposed the parliamentary resolution, arguing that military action would worsen the economic plight of Turkey's mainly Kurdish southeast."

There is lots of finger pointing going on. Most of the world's leaders are begging Turkey for restraint while Turkey claims Iraq, the KRG, and the United States have failed to deliver on their promises to curtail terrorist activity originating in northern Iraq.

"Throughout 2 1/2 hours of debate, legislators expressed frustration that the United States and Iraq have not kept promises to curb the activities of the Kurdistan Workers' Party, known as the PKK, which the United States and European Union have classified as a terrorist organization. As the votes were tallied in Turkey's modernistic legislative chamber here, President Bush told reporters at a White House news conference that 'we are making it very clear to Turkey that we don't think it is in their interest to send troops into Iraq.' In the hours leading up to the vote, Turkish leaders were besieged with last-minute telephone calls from across the globe, imploring against military action on grounds that it could inflame the only relatively stable region of war-ravaged Iraq. Iraqi Prime Minister Nouri al-Maliki telephoned Erdogan, asking for more time to take action against PKK rebels who have largely been allowed to operate freely in northern Iraq since the U.S.-led invasion in 2003. He said he has given 'strict instructions' to the regional Kurdish administration in Iraq's north to crack down on PKK operations and said Iraqi forces could join the Turkish army in military operations 'if necessary,' according to the Anatolian news agency. Erdogan's office denied there was an offer of joint military action. ... Turkish lawmakers on Wednesday accused the United States and the Kurdish regional government in northern Iraq of giving PKK leaders and fighters free rein to run their headquarters and training camps and plot attacks on Turkey, despite a 2003 agreement to assist in curbing rebel operations inside Iraq."

The KRG walks a fine line when it comes to the PKK. Historically, Kurds have been persecuted by major powers in the area and have longed for a country to call their own. As a result, the KRG finds it distasteful to have to use its military forces against ethnic Kurds. On the other hand, its economic development rests in large measure on maintaining good relationships with its neighbors, especially Turkey. There are suspicions in Kurdistan that the Turkey's real motive is slowing the economic progress in northern Iraq because success there only encourages Kurds in Turkey to seek an autonomous region of their own. Turkey, they insist, is only using PKK attacks as an excuse to disrupt the economy.

"In Kurdish-dominated northern Iraq, people expressed anger over the Turkish moves. Faisal Muhammad Abbas, 28, a university student, said that Turkey wants to bring "disaster" to his part of the country. "They think if Kurdistan will continue improving in Iraq this will be a motive for the Kurds in Turkey to call for the same thing and fight for it." Some Kurds say they have already fled their homes because of Turkish shelling.

In his press conference yesterday, President Bush noted that Turkey already had troops in Iraq and insisted that it didn't need anymore. But the Turks insist that the U.S., who pledged to help them with the PKK problem, simply is too involved elsewhere in Iraq to care about their problem. As a result, Turkish troops in northern Iraq are basically sequestered on their bases. That's what the Turks want to change.

"Turkey has had limited numbers of troops in northern Iraq since before the 2003 invasion. Morrell said there are now two or three battalions that function mainly as observers. 'They are pretty much confined to their bases,' he said. 'Their movements are limited and must be coordinated with us.' Although the Turkish government now has the authority to strike, some Turkish officials and military experts warned that the military would face serious obstacles in all types of cross-border action, including many of the same problems the U.S. military has experienced in Iraq. Turkish troops have conducted 24 cross-border attacks in northern Iraq since the conflict with PKK rebels began 23 years ago, according to Deputy Prime Minister Cemil Cicek. That included several operations with tens of thousands of soldiers and heavy aerial bombardments. The military never routed PKK rebels from northern Iraq. Now the task will be harder because the PKK has been embraced by the local Kurdish population and its authorities, officials and analysts said."

Turkey's frustration is understandable, PKK attacks have increased in the past few weeks, yet there has been no outcry from the West and little international press coverage. As a result, the Turks believe that the U.S. and EU are applying double standards when it comes to terrorist attacks.

"PKK rebels have escalated attacks inside Turkey in the last two weeks, killing 31 people including 13 military commandos and a busload of civilians. The Turkish public was enraged by the attacks, which were the deadliest in more than a decade, increasing pressure for cross-border action."

It's clear that something must be done. The U.S. certainly wouldn't tolerate such attacks without taking action and the Turks are aware of that; thus, the cries of double standards. For its part, however, the U.S. is looking at a broader regional picture. The Kurds in northern Iraq are America's strongest supporters in the region. More importantly, however, the U.S. is looking outside of Iraq to Turkey, Iran, and Syria (all of which have Kurdish populations within their borders). The U.S. fears that Turkish action against the PKK would encourage Iran and Syrian action as well. Things are already tense along the Kurdish border with Iran. The U.S., central Iraqi government, and the KRG must decide what is in the best interests of those living in northern Iraq. Whatever action is taken with be difficult, especially for the KRG, but it is essential if stability in the area is to be maintained. For its part, the PKK is not only risking the welfare of Kurds in northern Iraq, it is risking the future of Kurds in Turkey -- the very group they claim to be defending. Kurds living in Turkish areas across the border from Iraqi Kurdistan are major recipients of the economic boom taking place Kurdistan. Many of the workers and most of the businesses trading with Kurdistan are from the Kurdish areas of Turkey. If an economic miracle can take place in Kurdistan, there will likely be spillover effects that benefit Turkish Kurds. All this could come tumbling down if the PKK is not kept in check. Every group involved in this situation looks at it from its own unique perspective and each can mount reasonable arguments for why it has responded as it has. The solution to the problem, however, will require all parties being affected by PKK actions to work together. Name calling and finger pointing will only exacerbate the situation.

Globalization and Green Policies in China

Historically countries have ignored environmental concerns in their race to develop their economies. Some analysts have argued that it is only after countries achieve a certain level of prosperity that they begin to show concern for the environment. For example, W. Beckerman, in 1992, concluded "in the end the best – and probably the only – way to attain a decent environment … is to become rich." A more recent study [2004], by Rachel A. Bouvier [Air Pollution and Per Capita Income] concludes:

"While pollution levels may have declined after some turning point in some developed countries as per capita income grew, this does not necessarily imply that the same can or will occur in developing countries. ... To be sure, there is evidence that as a country develops, the share of its manufacturing sector in GDP falls and democracy strengthens. Both of these contribute to reductions in emissions. But these effects have not been sufficiently strong to offset the scale effect in carbon dioxide and volatile organic compound emissions. Moreover, as Arrow et al. (1995) caution, if the developing countries cannot follow the 'clean growth' trajectory that ostensibly has characterized the developed nations, then becoming richer may not improve their environmental quality. The findings reported here suggest that environmental improvements are especially unlikely if the growth process is heavy on manufacturing and light on democracy."

One thing is more certain, when pollution begins affecting the quality of life that increasingly affluent people enjoy, they pay attention and start demanding that their political leaders do something about it. China, which falls squarely in the "heavy on manufacturing and light on democracy" sector, is nonetheless experiencing a bit of a "green awakening" according to an article Ariana Eunjung Cha ["In China, a Green Awakening," Washington Post, 6 October 2007].

"One morning this summer, residents [Wuxi] awoke to find that their beloved Tai Lake had turned rancid. The water was filled with a bloom of blue-green algae that gave off a rotten smell. It was not only undrinkable; it was untouchable. Few living things stirred in the water. For almost three decades, the city had welcomed some of the world's biggest polluters. Churning out paper, photographic film, dye, fertilizer, cement and other products for the global marketplace, the businesses helped make Wuxi into one of China's wealthiest industrial cities. They also poisoned the province's vast network of lakes, rivers and canals. In late May, when the toxic sludge reached Tai Lake, which is the main source of potable water for Wuxi's 5.8 million residents, people turned on their taps and got only sludge. City officials decided they'd had enough. In a series of radical proclamations that sent shudders though the business community, Wuxi declared itself a newly reformed green city. ... In late May, the algae in the lake grew so fast that taps all over the city spewed dirty water. While most algae are harmless, the chemical runoff from factories had fattened the algae in Tai Lake into a toxic muck poisonous to humans and aquatic life. According to residents interviewed later, consumers panicked, and the price of large bottles of water jumped from $1 a bottle to $6. People couldn't clean dishes, couldn't wash their clothes, couldn't shower."

The most impressive thing was not that city fathers made proclamations, but that they acted, and those actions received accolades from Beijing. Even so, questions remain about whether the actions mark a new permanent path toward environmental cleanup.

"By September, the city had closed or given notice to close more than 1,340 polluting factories. Wuxi ordered the rest to clean up by June or be permanently shut down. The actions were applauded by Chinese Premier Wen Jiabao, who has vowed to use economic incentives and punishments to aid in environmental protection and resource protection. Last week, China's State Council approved an environmental plan that includes reducing major pollutant discharges by 10 percent by 2010. Plagued by water shortages, choking on dusty air and alarmed by a sharp increase in pollution-related diseases and deaths, China has been searching for years for a way to fix its environment without hurting its economy. China has closed vast swaths of polluting factories in the past, only to reopen them when unemployment rose too high.'

At least some pundits, according to Cha, believe that this new green awakening is for real.

"Elizabeth Economy, a fellow at the Council on Foreign Relations and author of 'The River Runs Black: The Environmental Challenges to China's Future,' said this time 'the commitment, the profile, the energy behind the state's environmental protection efforts far exceeds anything we've seen in China's history. It's not about new ideas, but about enforcement. ... What is changing are the incentives or disincentives.' On the other hand, Economy said, it remains to be seen whether local officials will follow the central government's lead. 'They have never had the bottom-up pressure that makes them change their practices, nor a top-down mechanism for providing the right incentive to make it easy to do the right thing,' she said. This year, some cities are taking measures that show that their officials are beginning to make the environment a higher priority than raising the gross domestic product, a fundamental shift in thinking for a country that can attribute much of its early development to being the place to which others outsourced their pollution."

Cha discusses the path that led to Wuxi's prosperity and to its pollution problem. It's an interesting journey since it serves as a caution for politicians and businessmen alike who are willing to pursue myopically economic growth without any consideration for the environment. In the end, this unbalanced strategy makes little economic sense since cleaning up the environment doesn't come cheap.

"Wuxi was one of the regions targeted under Deng Xiaping's 'opening up and reform' industrialization push in 1978. The area, once known as the 'land of fish and rice,' was transformed into the heart of China's chemical industry. Its economy ballooned from 2.5 billion yuan in 1978 to 330 billion yuan (about $44 billion) in 2006 -- bigger than that of Ecuador or Luxembourg. Now China's sixth-largest industrial city, Wuxi produces chemicals sold to the United States and other countries. It has a downtown of closely packed, dusty high-rises and is surrounded by idyllic countryside dotted with gargantuan factories spewing black smoke. Half the population is employed by the 5,300 factories with annual sales of at least $650,000 each. As Wuxi's economy grew, so did the pollution in Tai Lake, for centuries one of China's most picturesque lakes."

Although the algae bloom appeared almost overnight, warning signs had been appearing for years.

"As early as the 1990s, Wu Lihong, 39, a former sales manager for a factory, warned officials that the city was headed toward ecological disaster if it didn't shut down polluting factories. ... By 2003, it was clear the lake was sick, and the government banned fishing there. ... Wang Guoxiang, director of the Research Center for Eco-Environmental Sciences at Nanjing Normal University in Jiangsu province, said government engineers tried every scientific alternative possible, spending more than $1.3 billion to try to save the lake. They dug up the silt and replaced it. They poured fresh water into the lake and redirected rivers to try to wash the pollution away. They even seeded clouds to create rain to dilute the polluted water. But it took a crisis to force the government to start closing companies."

In addition to closing polluting companies, the city decided to take other steps as well.

"Gong Pin, deputy director of the Wuxi Economic and Trade Commission, said that the first stage of the factory closings targeted small chemical companies but was only the beginning. 'Our aim is to call attention and supervision from the society,' Gong said. The government also will require companies to move from populated urban areas to special industrial zones at their own expense, he said. Wuxi's environmental campaign has been held up as an example of how cities should deal with polluters."

That would be a great ending to the story, but unfortunately, that's not the case. Something quite unexpected is happening.

"Instead of shunning the polluting companies in Wuxi, delegations from other parts of China have been coming to Wuxi to invite them to come to their cities. 'This is impossible to understand,' said Wang of Nanjing Normal University. 'We keep telling them they are just moving pollution around and it isn't good for them, good for China.'"

If one considers Abraham Maslow's hierarchy of needs, this reaction is quite understandable. Not all parts of China enjoy the same level of prosperity as Wuxi. Those areas are desperate for jobs, desperate for infrastructure, and desperate to achieve their dream. Attracting businesses unwanted elsewhere is the quickest way to reach the next level of "need." Until governments make it clear that polluting is less profitable than operating as a so-called "green" company, businesses will continue to damage the environment and regions looking to become more prosperous will continue to welcome them (and will later come to regret that decision).

Growing Rice in Africa

Famine and hunger are twin plagues for much of the African continent. They are also two of the reasons that those areas remain in grinding poverty. The requirement to mount new food relief efforts seems neverending. Those relief efforts are becoming more expensive (which translates into less relief) because more and more agricultural land being turned over to crops aimed for the ethanol market. That is one of the reasons that the Bill & Melinda Gates Foundation Teamed with the Rockefeller Foundation in an effort to promote a "green revolution" in Africa. Last year I wrote a post about that partnership [Gates & Rockefeller Foundations Tackle Food Security in Africa]. The news was not welcomed by everyone. Some critics believe that if the "green revolution" primarily stresses the use of fertilizers, the cure will be worse than the disease. One answer being pursued is more robust plants. Celia W. Dugger, writing in the New York Times, notes that even when potential answers exist, implementing those answers isn't always easy ["In Africa, Prosperity From Seeds Falls Short," 10 October 2007]. The answer addressed in Dugger's article is rice.

"The seeds are a marvel, producing bountiful, aromatic rice crops resistant to drought, pests and disease. But a decade after their introduction, they have spread to only a tiny fraction of the land here in West Africa where they could help millions of farming families escape poverty. At a time when philanthropists like Bill Gates have become entranced by the possibility of a Green Revolution for Africa, the New Rices for Africa, as scientists call the wonder seeds, offer a clear warning. Even the most promising new crop varieties will not by themselves bring the plentiful harvests that can end poverty."

When addressing development challenges, those involved must take a holistic approach or they are likely to be disappointed with the results. Failure to address the entire challenge is apparently what happened in the case of these new rice varieties.

"New ways to get seeds into the hands of farmers are needed, as well as broader investment in the basic ingredients of a farm economy: roads, credit and farmer education, among others. Developed with financing from wealthy countries and private foundations, the New Rices for Africa, or Nericas, are unpatented and may be grown by anyone. Yet there is a severe shortage of them in a region where both the private and the agricultural sectors are woefully undeveloped."

Even looking at the "A" to "Z" processes of a particular sector is not sufficient. The financial sector, the market sector, the transportation sector, the energy sector, the telecommunications sector, and so on all touch on the success of the agricultural sector. It is the integration of the economy that lifts people out of poverty, not just success in one particular sector. Back to the story about African rice.

"In West Africa, where rice is a staple crop, the African Development Bank is financing a $34 million program in seven countries to spur wider use of the new rice seeds. But the obstacles are daunting. Farmers typically lack credit to buy seed and fertilizer. And the agricultural economy itself suffers from a lack of investment. Foreign aid for agriculture has plunged over the past two decades. And African governments — some, like Guinea, endowed with natural resources and cursed with corruption — have too often spent less of that wealth than they might have on rural development. Decent roads to move crops to market are scarce. So are storage facilities to preserve harvests and crop insurance to protect farmers from drought, flood or bumper yields that perversely cause prices to collapse. All can wipe out the income farmers need to provide reliable demand to seed companies, making sale and distribution of the improved seeds a high-risk venture. Across the region, a handful of private companies in Nigeria and Benin have begun to multiply and market the new rice varieties. Here in Guinea, where there is not a single seed company, the government is now working with farmers to expand the supply of Nericas seed."

According to Dugger, farmers are willing (even anxious) to plant and harvest the new seeds. The problem is that they can't get them in sufficient quantity.

"Villagers here in Hermakono [Guinea] first enviously spotted the new rices growing in a neighboring community’s field. In 2006, after writing to the Agriculture Ministry, they got their first small store of the seeds. So precious were they that as the first crop grew heavy with grain, the villagers took turns standing watch in the fields. 'We divided into small groups to guard it so nobody would steal even one stalk,' said Goulou Camara, a farmer. Early one morning last year, a dozen farmers threshed their first harvest. They swirled in a circle, kicking golden sheaves of rice into the air with their bare feet, then beating them with sticks to shake loose the grains. They were determined not to eat any of it, but to save it to plant as seed."

Of course, rice saved as seed is rice not available to sell or eat. That demonstrates how valuable farmers see the new crops -- they are willing to do whatever belt tightening they need to do in order to secure a better future for themselves and their families.

"Only about 200,000 African farmers are sowing the new rices on just 5 percent of the land where they could thrive, according to the Africa Rice Center, an international research institution based in Benin that developed the new rices in the mid-1990s. In contrast to Africa, India had a stronger foundation when new wheat varieties set off a Green Revolution there in the 1960s and 1970s, allowing the nation to feed hundreds of millions of people. India had a public seed company to take the marketing risks, far more irrigated farmland and a better road system. 'If we don't develop the infrastructure, there’s no way we’ll attain the Green Revolution,' said Monty Jones, the plant breeder whose groundbreaking research led to creation of the new rices. 'How do you bring the Nericas to farmers? How do you get farmers to know the seeds exist?'"

Jones is right; you can't start a revolution without connectivity. The fourth step of the Development-in-a-Box™ flexible framework is training accompanied by a broadbased public education program. This step is intended to address Jones' question about how farmers can learn about the existence of available programs. You can establish the best programs in the world, ensure they run using the best practices, but if no one knows about or uses them they just as well not exist.

"Mr. Jones now leads the Forum for Agricultural Research in Africa, based in Ghana. He also serves on the board of the Alliance for a Green Revolution in Africa, a nonprofit group financed with an initial $150 million from the Gates and Rockefeller foundations. The alliance intends to invest $23 million to promote the distribution of promising seeds."

Mr. Jones life story is worthy of article by itself. He is a homegrown success story.

"Mr. Jones, 55, who was born into the Creole elite of Sierra Leone, said he decided to go into the agricultural sciences when as a teenager he heard of rioting over rice shortages in West Africa. At age 39, he was put in charge of a team breeding upland rain-fed rice varieties at the West Africa Rice Development Agency, now the Africa Rice Center. For more than a generation, scientists had unsuccessfully sought to combine the hardy African rice species with high-yield Asian species. With great ingenuity, his team overcame the obstacles and produced the first new rices more than a decade ago. The new seeds increased yields even without fertilizer and more than doubled them with it. From planting to harvest, they also took three months rather than the five or six required by traditional varieties, putting rice on the family table during the hungry season. But to sustain increased yields, farmers need a reliable source of fresh seed. Productivity declines when the new seeds become degraded after mixing with local varieties in storage sheds and fields and on the floors of the farmers' huts."

To demonstrate how quickly seed degradation can occur, Dugger recalls the experience of Odia Camara, a 30-year-old farmer and mother of five.

"[In 2002,] Ms. Camara’s group of about 50 farmers, all women, initially organized to grow vegetables, was one of two groups in the village that got their chance [to grow the new variety of rice]. The government provided each of them with a scant 55 pounds of seed, as well as subsidized fertilizer — enough for a small plot. The groups also got basic machines to thresh, husk and parboil the rice from Sasakawa-Global 2000, a nonprofit partnership organized by Jimmy Carter and Norman Borlaug, the scientist who won the Nobel Peace Prize for his contributions to the original Asian Green Revolution. The first two years, the new rices yielded the village's richest rice harvests ever — triple the usual amount. There was plenty of the aromatic rice to feed the families and cash left over to pay children’s school fees. Even cranky marriages mellowed. ... But 2004 brought signs of trouble. The groups had a decent harvest, but the acreage planted was greater and the yields lower because the new seed was not as pure. In 2005, international donors did not give Guinea fertilizer, and the government provided none to the farmers in the area, nor did private traders bring any to local markets, according to government officials. At harvest time, yields plummeted. Hunger stole back. Ms. Camara's group grew so discouraged, she said, that it wanted to give up on the new rices."

Ms. Camara's case demonstrates that creating a "sustainable" economy is not as easy as some people might think. Lots of moving parts are involved and when any one of them goes missing, the process breaks down. Fortunately, that wasn't the end of the story. The Guinea government provided the village with new seed and is encouraging them to continue growing it. The government is also providing seed throughout much of the rest of the country.

"Despite the challenges, the new rices spread farther in Guinea than in any other country, covering 16 percent of the area under rice production — progress credited to the commitment of civil servants and the enthusiasm of the political elite. But the rice seeds could have reached many more farmers if they knew about them and were able to buy them, researchers say. Guinean officials complained that rich countries had not invested enough in agriculture. But Tareke Berhe, an agronomist who represented Sasakawa-Global 2000 in Guinea from 1996 to 2004, said the government should have spent more on agricultural fundamentals. Guinea is rich in resources but has been plagued by corruption and ruled for more than two decades by the autocratic leader Lansana Conté. 'Guinea doesn't have to depend on anybody,' Mr. Berhe said. 'It's a rich country in every way. It has diamonds, gold, bauxite. It has forestry products, lumber. It has a long coastline with fisheries.' Meanwhile, the people make do. After a grueling afternoon threshing rice last year, Ms. Camara sat in front of her mud hut with her baby boy on her lap. She had earlier spoken lyrically about farming when su