| By Finlo Rohrer BBC News Magazine |
London mayor Ken Livingstone is the latest civic leader to hanker after independence. Is the nation state under threat from the rise of the super-city? 
Greater Shanghai has a population that has passed 20 million. The sprawl of Mexico City is estimated to house another 20 million. And Mumbai too.
These cities are bigger than many industrialised nations. And they are growing at a dizzying rate, sucking in workers from rural areas.
Sociologist Professor Richard Sennett believes the rise of these cities is changing their relationship with the countries they are in. He is one of a number of academics carrying out research into the evolution of cities.
Economically, many of the world's great cities are already divorced from their nation-states, with their main streams of investment come from other great cities.
"The most important place to London is New York and to New York is London and Tokyo," Prof Sennett says. "London belongs to a country composed of itself and New York."
And the need to co-ordinate ever more frenetic regeneration and infrastructure growth has led to increasing power for cities. 
Shanghai has so much power and autonomy it has been described as effectively a city-state, within China only in geography. And on Thursday London Mayor Ken Livingstone was handed a raft of new powers over planning, housing and the environment.
He joked: "Having been to Singapore and seen how successful it was I think anything short of a fully independent city state is a lost opportunity, with its own foreign and defence policies thrown in."
And Ivan Massow, who has twice tried for Mr Livingstone's job as first a Conservative and then Labour hopeful, has long campaigned for the capital to be given a "fair share of the national cake".
"It will cost £2 billion to fix the Tube and £1.5bn to benefit from the effects of the 2012 Olympics, yet [Londoners] subsidise the rest of the UK to the tune of £20 billion a year."
Sister cities
There are many British people who already find London a strangely foreign place. And when the London-centric media views the rest of the country, it has a pronounced tendency to view it through a prism of life in the capital.
Elsewhere in the UK, cities like Liverpool - particularly during the city's battle with Margaret Thatcher in the 1980s - Manchester, and Newcastle have long harboured independence fantasies. 
Prof Sennett says the inequalities between London and other British cities will only increase. And with the economic and demographic gulf widening, it will soon be even harder to accept that London has more in common with Sheffield than Shanghai, with Preston than Paris.
It all has echoes of Europe's great tradition of city states, from Ancient Greece through Renaissance Italy and pre-1870s Germany.
One thing that sets London apart - and puts it in the same bracket as the other mega-cities - is its attractiveness to immigrants. Prof Sennett paints a picture of an intensely entrepreneurial class of economic migrants on a global travelator around swelling cities, moving Shanghai to London to New York. Many have no moorings and an ambivalent attitude towards the country outside their host city.
But there are signs for hope, such as the national sense of loss over the 7 July bombings.
Prof Sennett concludes: "I don't think people can really do without national unity. It is culturally unsustainable."
Capitalise on London's success: Prof Sennett's views make sense. It is therefore important that a successful growing London continues to receive government investment for key infrastructure to maintain its position as the most productive area in the UK and Europe.
James Gardner, London
I no longer see London as part of my country, it's economy, cultural make up, wealth and outlook are totally divorced from anything I recognise as British in any sense.
Ceebe, West Mids
No matter how developed they become, cities will always be reliant on the surrounding country for natural resources. People have to eat, need gas for their automobiles. No amount of economic development can change that simple fact.
Lance, Berkeley, California
The time is fast approaching when cities like Manchester and Birmigham need to have much greater freedom and control of their "city regions" in order to prosper. The English "city regions" have much less in common with smaller cities and towns in the mainly shire counties and consequently need a different form of government. A "city region" mayor as in London is probably a sensible first step but in any event change must surely come.
Doug Hardy, Manchester
So London subsidises the UK to the tune of £20bn a year? Surely this is fair recompense for the non-financial subsidies (workers, graduates, know-how etc) the rest of the UK supplies to London thus enabling it to generate so much wealth. Or what about the billions in Scottish oil revenue that floods into the wider UK economy and, hence, London's. I'm not arguing over whether any of this is right or wrong but simply pointing out that there are non-financial economic measures as well.
Mike Weir, Glasgow
Witness the Freest Economy: The Internet
Witness the Freest Economy: The Internet
Note: Mises videos use Silverlight. You may view the non-Silverlight version.
A Free Market in Money?
A Free Market in Money?
Can the monetary system regulate itself, or does it require oversight by government regulators? According to Lawrence H. White, who gave a lecture entitled "Can the Monetary System Regulate Itself?" at Rhodes College this past March the answer to the first question is "yes" and the answer to the second question is "no."[1]
According to Professor White, who was until recently the F.A. Hayek Professor of Economic History at the University of Missouri-Saint Louis and who will join the faculty at George Mason University this fall, theory and history provide a strong case for a free market in money and banking.
The idea that a monetary system can regulate itself has a long tradition in economics and appears in the work of Adam Smith and David Hume. Both believed that the price mechanism would prevent money shortages. This stands in contrast to the ideas of 17th- and 18th-century European mercantilism. According to the mercantilists, the wealth of nations consisted of its stock of gold and silver reserves. In the minds of the mercantilists, the way to for a country to get rich was to encourage exports (which earn gold and silver) and to discourage imports. However, according to the "price-specie flow mechanism" identified by Hume prices adjust to ensure a balance of imports and exports.
In his March 9 lecture at Rhodes, Professor White pointed out that today's crisis is an artifact of the highly regulated monetary system. He proposed that banking deregulation would reduce exposure to external shocks and increase rather than decrease stability. White cited his research on the history of banking in Scotland to provide evidence that the banking system can correct itself without government intervention. Specifically, he argued that a market with private note-issuing banks has built-in mechanisms to constrain monetary over-expansion.
According to White, vigilant internal monitoring would be vital to a bank's ability to weather external storms, and the prospect of failure would provide banks with the incentive they need to be prudent stewards of their depositors' funds. Therefore, government intervention in the monetary system is superfluous when it is not destructive. The self-correcting tendency of an unregulated market for money suggests that it is time to reconsider whether we need the Federal Reserve.
The unregulated system's alleged susceptibility to bank runs is also over-stated. One of the most important reasons for bank failure is not bank runs but bad loan decisions: Professor White demonstrated that government loan guarantees and government willingness to bail out failing banks have in fact encouraged risky loaning behavior. Though the Federal Reserve aims to promote monetary and economic stability, they distort interest rates, worsen inflation, and cause business cycles by printing money.
In Scotland, as Professor White pointed out, people still use private bank notes issued by independent banks. These banks succeed in the market not through government regulation but by promoting the use of their notes (in order to promote their business, for example, they set up many ATM machines and charge no fee for withdrawal of their notes).
Canada's experience during the Great Depression also gives us reason to doubt the wisdom of monetary intervention. Canada has historically had low levels of government intervention and an unregulated banking system. Professor White noted that people did not run on Canadian banks in the same way that they ran on American banks during the Great Depression. In part, this was due to the absence of branch banking restrictions that prevented American banks from diversifying their risks. The Canadian banking system adjusted to new market conditions and did not undergo the protracted crisis that occurred in the United States.
Professor White's lecture showed that, historically, a free-market approach to the banking industry is less prone to crises and operates efficiently through the invisible hand of the market. From the ideas of David Hume and Adam Smith, through the experience of banking systems in Scotland and Canada, we can see that the case for government intervention in the monetary system has been overstated.The Free Market in Hong Kong
The Free Market in Hong Kong
In a reply to a recent mises.org weblog posting someone posted a challenge- Would anyone be so kind as to tell me in which countries poverty was eliminated by means of your (Austrian) enlightened theories?…” the author of the original post replied with several good examples, without discussing any specific details of how these countries managed to succeed. Here are some of the specifics from one particular free market success story.
After the Second World War Hon Kong had no minimum wage, low and simple taxes, zero tariffs, aero capital controls, and a stable legal environment. The government in Hong Kong invested in its seaport and public education, but public spending ranged from 13-19% of GDP. Hong Kong has also avoided accumulation of public debt. Hong Kong actually ran budget surpluses in 32 years between 1948 and 1985. Hong Kong is an excellent example of a free market-limited government society, but how well did this example of laissez faire work?
At the end of the Second World War per capita income was 180$. BY 1982 the per capital income of Hong Kong was 6,000$. Even the lowest 20% of Hong Kong households reached 1300$ per capita income by 1976- seven times the average income just after the war. From the mid fifties to the 1970’s Real wages in Hong Kong more than doubled, and unemployment fell below 3%.
From 1948 to 1960 Hong Kong’s GDP grew at a rate of 7% per year. From 1961 to 1980 Hong Kong’s GDP grew 9% per year. From 1979 to 1984 Hong Kong’s GDP grew 7.6%, despite a worldwide recession. All of this happened without foreign direct aid of any kind.
Postwar Hong Kong went as far with economic laissez faire as any other country in history. This resulted in economic development that benefited virtually all the people of Hong Kong. Living standards increased substantially even for the poorest people in Hong Kong. There are other examples too, like postwar West Germany. The architect of the postwar Wet German ‘economic miracle’ was Wilhelm Ropke. Ropke was influenced by the writing of Ludwig von Mises, so the success of laissez faire in postwar West Germany can be directly attributed to Austrian Economics. This is only one example, but economic freedom indexes provide further evidence of the success of laissez faire economics.
El resultado de la búsqueda de Google: Hong Kong
Por L. Gordon Crovitz
![[crovitz]](https://lh3.googleusercontent.com/blogger_img_proxy/AEn0k_vpNafltwwmEzenYAiIo0YGJyBTzX1Ihsf_u2t3HxXXMa4Y55CHQrES_01G8bX0rIVSf1Oo72VDKZLeOp6JEHSj2wLh70teQYl8RYllgWRkY8b200Ja6x3LNgNVrZ_DzLPkSmuIR23cqo6dB8LGfDQh5Q=s0-d)
Ya sea algo planeado por sus ejecutivos o no, Google podría alcanzar algún día la envidiable posición de viejo amigo de China. Durante la apertura gradual de las décadas de los 80 y 90, muchas empresas occidentales expulsadas durante el período maoísta regresaron a posiciones privilegiadas. Cuando China se abra a la economía de la información, de la misma forma que lo ha hecho con las manufacturas y las finanzas, Google podría ser la primera compañía tecnológica en haber hecho lo correcto, tras mantener su posición y haber encontrado un punto intermedio aceptable.
Google cumplió su promesa de dejar de censurar los resultados de búsqueda en China, gracias a la elegante solución de trasladar su motor de búsqueda a Hong Kong. En una entrevista con The Wall Street Journal publicada la semana pasada, Sergey Brin, uno de los fundadores de Google, dijo que la idea fue, "de hecho, sugerida indirectamente por el gobierno chino".
Brin no dio detalles, pero este episodio ha ayudado a Google a aplicar una de las máximas de "El Arte de la Guerra", de Sun Tzu, alcanzando sus metas mientras ayudaban a China a no pasar una vergüenza. Google ahora ofrece búsquedas sin censura en su sitio de Hong Kong con la posibilidad de escoger el lenguaje entre los caracteres simplificados que se usan en el continente o los complejos que se usan en Hong Kong. [El martes, los usuarios chinos experimentaron bloqueos a sus búsquedas, que en un principio se atribuyeron a un error técnico por parte de Google y luego a un problema en el servicio de bloqueo del gobierno chino. El servicio se reestableció hacia el final del día].
Por otra parte, China puede decir que Google está cumpliendo con sus leyes, las cuales definen a Hong Kong como una región administrativa especial. Hong Kong tiene amplias protecciones de la libertad de expresión bajo la fórmula de "un país, dos sistemas", que Londres y Beijing establecieron para permitir la entrega de Hong Kong en 1997. Por supuesto, Beijing puede bloquear el acceso de los residentes del continente a los resultados políticamente sensibles en el sitio de Hong Kong, como hace con otros sitios ubicados fuera del continente.
La historia reciente muestra que mantener la firmeza frente a Beijing puede ganar su respeto. Chris Patten, el último gobernador británico de Hong Kong, fue oficialmente calificado como "una prostituta por mil años" y un "criminal por mil generaciones", tras sus esfuerzos por impulsar modestas reformas democráticas en la entonces colonia. El insulto chino de que "Google no es Dios" parece suave en comparación. Lord Patten ha vuelto a ser bienvenido en Beijing y a ser considerado un viejo amigo de China.
Google tenía razones más allá de China para tomar una medida de este tipo. Brin confirmó que lo que llevó a la compañía a rectificar su decisión de 2006 de censurar las búsquedas en China fue la violación de las cuentas de correo electrónico de un grupo de militantes de derechos humanos. Brin, nacido en la Unión Soviética, le dijo al Wall Street Journal que, aunque China ha hecho algunos progresos, "en otros aspectos de sus políticas, especialmente con respecto a la censura y a la vigilancia de los disidentes, veo las mismas marcas de los gobiernos totalitarios, y, personalmente, me parece bastante preocupante".
David Drummond, director legal de Google, relacionó la violación de las cuentas de email con la decisión de abandonar la censura en los resultados de las búsquedas. "La mayoría de los ataques cibernéticos que usted ve en China son independientes. Quizás patrocinados por el gobierno, quizás no", le dijo Drummond la semana pasada a la revista The Atlantic. "Este ataque fue diferente. Estaba casi exclusivamente destinado a meterse en las cuentas de Gmail [el servicio de correo electrónico de Google] de determinados activistas de derechos humanos, dentro y fuera de China". Esto "hacía parte de un sistema general dedicado a restringir la libre expresión, controlando los resultados de búsquedas en Internet o intentando vigilar a los activistas".
Google necesitaba decirles a sus usuarios alrededor del mundo que sus sistemas son confiables, o que al menos la empresa revelará las filtraciones. La confianza es especialmente importante en el nuevo mundo digital, donde los derechos a la privacidad y sus expectativas todavía se están desarrollando. Google necesita convencer a sus usuarios de que usará indebidamente la enorme cantidad de información que posee acerca de aquello que buscamos, leemos, miramos y escribimos. Esperamos que nuestras cuentas de correo electrónico sean sacrosantas e inaccesibles para gobiernos extranjeros u otros hackers.
Por ello, probablemente no fue una coincidencia que la semana pasada google también lanzara una actualización de Gmail llamada "Detectando actividades sospechosas en la cuenta". Esta nueva función permite a los usuarios ver si sus cuentas han sido usadas recientemente. Pueden recibir alertas cuando alguien ingresa a su cuenta desde un lugar considerado sospechoso por Google.
La pelea entre Google y China le devuelve el protagonismo a Washington. Google también necesita ayuda, y por eso compara, con razón, a los "hackers" de hoy con los piratas que debían ser derrotados para asegurar el libre comercio. Las compañías estadounidense están por delante de su gobierno.
"Por más difícil que sea la relación de Google con China", dijo el representante comercial de EE.UU., Ron Kirk, "mi primera preferencia es siempre ver si no podemos construir una sociedad para trabajar con China, con el objetivo de llegar a una resolución más temprano que tarde". En resumen: no habrá mucha ayuda aquí. Mientras tanto, China sigue bloqueando a Facebook, Twitter y YouTube.
Google ha hecho todo lo que puede hacer una empresa privada, pero sus servicios siguen en peligro. La seguridad en Internet sólo estará asegurada cuando Estados Unidos decida que el libre flujo de información es un asunto de interés nacional que vale la pena proteger.
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