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Before starting on the subject of debt I wanted to make a quick reference to something sent to me by Charles Horner, a senior fellow at the Hudson Institute. I am glad to say that the overinvestment thesis is much more widely acknowledged today than it was even two or three years ago, but one myth, I think, is that most of the overinvestment excesses in China are concentrated in the real estate sector. I have always argued that it is infrastructure where the most amount of investment has been wasted.
Its impossible to prove one way or the other, but Horner sent me a paper in the Oxford Review of Economic Policy, by Oxford’s Bent Flyvbjerg, with the rather alarming title “Survival of the unfittest: why the worst infrastructure gets built—and what we can do about it”, which suggests why we need to be so worried about infrastructure spending in China – aide from the fact that the numbers are simply huge.
In the paper Flyvbjerg looks at infrastructure projects in a number of countries (not in China, though, because he needed decent data) and shows how the benefits of these projects are systematically overstated and the costs systematically understated. More important, he shows how these terrible results are simply the expected outcomes of the way infrastructure projects are typically designed and implemented.
It is not a very happy paper in general, but I am pretty sure that many people who read it probably had a thought similar to mine: if infrastructure spending can be so seriously mismanaged in relatively transparent systems with greater political accountability, what might happen in a country with a huge infrastructure boom stretching over decades, much less transparency, and very little political accountability? Isn’t the potential for waste vast?
At least 252 tonnes of synthetic drug-making chemicals have been seized at a Mexican port in one of biggest seizures of such substances in the country.
The monomethylamine chemical, used to make illegal synthetic drugs such as crystal meth, were seized at the Pacific port of Lazaro Cardenas.
The shipment, reportedly sent from Shanghai, was destined for Puerto Quetzal in Guatemala, said the navy secretariat, the federal attorney general’s office and the internal revenue service in a joint statement.
250 tonnes of drug-making chemicals seized in Mexico | Asia Pacific News.Net
At least 10 bodies, some of them decapitated, have been found in a Mexican town, officials said.
The bodies were found Friday in the northern part of the Mexican Gulf coast state of Veracruz, said the state attorney general’s office.
Sources said the bodies bore signs of torture and some had been decapitated.
The Gulf, Los Zetas, and the Jalisco Nueva Generacion cartels, as well as the La Familia Michoacana crime syndicate, are fueling the violence in Veracruz, where more than 500 people have been killed this year.
On Sep 20, at least 35 bodies were found dumped on a busy thoroughfare in Veracruz city. A week later, 32 bodies were found at three drug-gang houses in the Veracruz-Boca del Rio metro area.
The violence prompted the federal government to deploy the military to the state in October.
Veracruz state is Mexico’s third-most populous and is known as a key drug-trafficking corridor to the US.
Mexican federal police arrested a suspected leader of the Los Zetas cartel in the violence-racked Gulf coast state of Veracruz, officials said Saturday.
Amado Mercado Guerrero, a former police officer in several towns of Veracruz and the purported head of a Zetas cell in the northern part of the state, was arrested Friday, the federal Public Safety Secretariat said in a statement.
Authorities said several kidnapping probes in that region led them to Mercado, whose area of influence covered the Veracruz municipalities of Tlapacoyan, Martinez de la Torre, San Rafael, Vega de Alatorre, Tuxpan and Poza Rica, the statement said.
The suspect headed a group of criminals that extorted business owners and kidnapped those who refused their demands and members of rival gangs, it added.
Narco Blog: Mexico Nabs Suspected Zetas Boss – Hispanically Speaking News
A group of five gunmen attacked three buses in Mexico’s Gulf coast state of Veracruz on Thursday, killing a total of seven passengers in what authorities said appeared to be a violent robbery spree.
The Americans killed were a mother and her two daughters who were returning to visit relatives in the region, known as the Huasteca, said an official in the neighboring state of Hidalgo, where the mother was born.
Hidalgo state regional assistant secretary Jorge Rocha identified the dead U.S. mother as Maria Sanchez Hernandez, 39, of Fort Worth, Texas, and the daughters as Karla, 19, and Cristina, 13. Rocha said all three held dual U.S.-Mexican citizenship. A 14-year-old Mexican nephew traveling with the three was also killed.