With the $1.8 billion donation from the former New York City Mayor Michael Bloomberg, students at Johns Hopkins University could enjoy greater access to financial-aid packages and scholarships starting next fall. This billion dollar’s worth of gift would allow the University to permanently adopt a “need-blind admission”, meaning that the admission board will not take into consideration students’ financial ability during the selection process, a report from Bloomberg says.

Even though the contribution has marked a record high in the U.S. education realm, it only accounts for a tiny share in the overall amount of student debt in the country when we look at the bigger picture. According to the 2018 student loan debt statistics from Make Lemonade, a free personal finance website, student debt has ballooned to more than $1.5 trillion with over 44 million borrowers in the U.S.

Source: The New York Times

Students in the Class of 2017 owe an average of $40,000 in student loan debt, up from $37,172 for the Class of 2016. It has become the second-largest consumer debt, following mortgages. At the same time, more than 10 percent of the mounting student loans were at least 90 days overdue.

Students have borne the brunt of the drop in house values, as it becomes tougher for parents to take out mortgages to pay for their children’s education, an article published by The New York Times says. Students have no choice but to shoulder the financial burden in exchange for a college degree.

So is this borrowing sign pointing to a grim picture of the future economy, or is it reminiscent of the decade-old financial crisis?

While the student loan market is smaller and less complicated than the mortgage market, it is less likely to create ripple effects across the world as the mortgage market did 10 years ago. The housing crisis in 2008 was unstoppable because a slew of financial institutions was involved in the mortgage world, with fledging crackdown on lending activities. As the federal government is the biggest lender of student debt, it gives people more confidence that the student loan market is better shielded from a debt explosion.

Although the speculation about the next economic recession is in gradual crescendo, the student debt market is expected to have limited impacts on the overall economy.

On July 6^th, 2018, Donald Trump challenged Chinese President Xi to an economic chess match. Trump, however, may have underestimated Xi when he decided to make the first move. Both sides have made considerable dents in each other’s key industries. Engaging in tit-for-tat trade disputes may seem like it will yield results, but in the long-term, it damages crucial relationships that could hurt America’s biggest industries. For the U.S, soybeans are what’s at stake.

 

The United States’ biggest export is food, beverage, and feed according to a U.S Commerce report in 2017. Soybeans make up the largest part of that industry, and 60% of them were exported to China last year. The Asian country typically buys around 7-10 million tons from the U.S annually. Last Friday, November 2^nd, soybean prices even fell to around $448 a ton, which is the lowest it’s been in 6 years.

Though China is the U.S soybean producer’s biggest buyer, it may not be that way for long. The economic impact of tariffs on U.S. exports and a protectionist trade policy may damage the Chinese economy in the short term, but will eventually just push China to find alternative ways to avoid importing such high amounts of this product from America.

China does receive most of its soybeans from the United States, but it also gets them from Brazil. South America may be Xi’s best option if Trump doesn’t step down.

Though Brazil consistently runs out of soybeans at the end of each cycle, it could likely ramp up production efforts if need be. In the last 20 years, the country has increased its soybean production by 266%, whereas the United States’ production has only increased by 63%. However, production costs for Brazilian farmers may end up being too high to keep up with Chinese demand.

Another option would be for Chinese investors to buy and develop land to produce soybeans in a country with the same comparative advantage, even Brazil. Some experts say Brazil is not reaching its full potential, and has a lot of untapped land. Again, if this is a viable option in the long term, it could take away China’s need to rely on American soybean farmers.

President Xi’s Belt and Road Initiative (BRI) is also a key player in reducing reliance on U.S agriculture throughout this trade war. The Initiative is an effort to connect Asia, Africa, and Europe for mutually beneficial economic opportunities. China wants a “belt” of overland corridors and a “road” of shipping lanes between 71 countries. That means the BRI streamlines trade between half of the world’s population and a fourth of the global GDP.

The BRI brings an increased level of economic interaction to China, making it that much easier to locate untapped areas equipped to produce soybeans other than the United States.

If China resorts to any of these options, U.S soybean farmers are going to take a long-term hit. While America can refocus its efforts to shipping out the product to other countries, if China manages to get Brazil to ramp up production levels or invests in agricultural land in other countries, it would lower the need for U.S trade partners to exclusively import soybeans from America.

 

China is now taking short term measures to deal with Trump’s tariffs. The China Feed Industry Association proposed in September to ration out soybean feed to pigs. The Xi administration is also maintaining a positive attitude by looking to increase domestic soybean production.

“Unilateralism and trade protectionism are rising, forcing us to adopt a self-reliant approach. This is not a bad thing,” Xi said in September.

In a retaliatory statement, the Vice Agriculture Minister Han Jun warned that Trump is playing with fire.

“Many countries have the willingness and they totally have the capacity to take over the market share the U.S. is enjoying in China. If other countries become reliable suppliers for China, it will be very difficult for the U.S. to regain the market,” Han Jun told the Xinhua news agency in August.

Soybean producers in China are already benefiting from the conflict. Yang Guiyin, the sales manager of an agricultural company in the Heilongjiang Province, said that soybean profits are on the rise.

“Our farmers really hope that China will import less soybeans so that domestic soybean production and soybean-related businesses will flourish,” Guiyin told NBC News in July.

The Chinese Government is pushing its domestic agenda even further as it aims to add $1.6 million acres of land to its existing soybean production. It is also subsidizing $190 to $320 per acre instead of the previous $150.

 

Looking ahead, the future of U.S soybean farmers will be determined by conversation between Trump and Xi. The world leaders have planned to meet on several occasions, but due to rising tensions, have not been ready to negotiate quite yet. The White House decided recently to move forward with conversation. Trump and Xi are planning to discuss the escalating situation at the Group of 20 leaders’ summit in Buenos Aires at the end of November.

For the Trump administration, the pressure is on. President Xi purposely targeted the soybean industry because the farmers primarily reside in states that elected Trump to office. China is looking to hit his weak spots. If Trump’s support system loses faith, it could have detrimental effects for republicans come November’s elections.

Iowa, Minnesota, Nebraska, North Dakota, and Indiana are all major soybean producing states and all voted for Trump in 2016.

In any trade war, just like in real wars, people are hurt. Trump stands by his belief that the United States will beat China, but if Xi continues to match Trump’s level of tariffs, it could get very ugly. Americans have no choice but to wait and see if Trump is correct in tweeting that “we win big.”

 

 

 

 

There are about 6.6 million job openings in the United States right now, according to the Bureau of Labor Statistics. Despite these opportunities, however, an increasing number of individuals are moving towards the “gig economy.” 42 million workers are anticipated to be self-employed by 2020. More than 36% of the workforce currently works freelance, latest estimates project. This trend towards an increasingly independent workforce, a workforce not tied to any employer restraints or benefits, presents promising opportunities in industries that need the most innovation.

With the healthcare industry constantly under scrutiny for excessive costs, mismanagement, and poor patient outcomes, this new trend in labor preference may prove to be a promising opportunity for providers to cut costs. The United States currently faces a dramatic shortages of healthcare workers from the home care level to the operating room, and the country is currently on track to face a shortage of between 40,000 to 104,000 physicians by 2030.

By connecting the gig economy to the healthcare industry, the result appears to be win-win. Workers have more flexibility, can negotiate their own contracts, and can select opportunities most appealing to them. Employers, like hospitals, can dramatically reduce costs and more nimbly respond to varying demand. In an industry that is the poster-child for egregious costs, treating health aids and doctors like Uber drivers starts to look appealing for the bottom line, particularly when labor accounts for 60% of spending.

Before we quickly begin allocating freelance workers into the healthcare (or any other) industry, we must consider the broader implications of incentivizing such volatile jobs. The irony of suggesting that freelancers, members of the gig economy, enter the healthcare workforce is that one central tenant of working project-to-project, operation-to-operation, is that employers do not offer healthcare benefits to these temporary workers. As Reuters points out, freelancers’ income is constantly in flux, making coverage options ever-changing as well. This makes finding health insurance a particularly perplexing problem. “If you are a freelancer facing the pure retail cost of healthcare, then it is horrifying,” notes Kathy Hempstead, senior advisor of the Robert Wood Johnson Foundation.

This dilemma affects more than just freelancers, however. Without a critical mass of individuals insured through traditional insurance plans, we may face a new problem of not having enough enrolled individuals to pool risk, making our health insurance program obsolete. While programs like the Affordable Care Act has attempted to address this growing problem, legislation is too slow and resistance too large to address the evolving problem’s rapid growth.

While we should be finding ways to innovate the labor market as we innovate industry, we must also be futurists, considering not merely the short-term benefits of our actions, but also long-term implications. The main problem with this employment shift may be, like so many others, not the evolution itself, but the rate at which it is occurring.

The U.S. economy is witnessing a tightening labor market as unemployment rate fell to a 49-year low of 3.7 percent in Oct. 2018, according to the U.S. Bureau of Labor Statistics. However, the labor force participation rate, which measures the percent of prime-age workers (aged 25-54) who are employed or actively seeking work, remained relatively low at 62.9 percent in Oct. 2018.

The U.S. Bureau of Labor Statistics estimated that the number of employed American aged 65 to 74 will rise 4.5 percent, while the participation rate for people aged 16 to 24 will drop 1.4 percent over the 2014-2024 decade. By 2024, the labor force ages 65 or older is expected to grow about 13 million people.

Source: U.S. Bureau of Labor Statistics

When it becomes harder for fast-food chains to recruit young people, restaurants like McDonald’s and Bob Evans are shifting their hiring focus to senior citizens – who are willing to work even part-time to earn some extra income in retirement.

Restaurants are actively posting recruitment ads at centers, churches and websites targeting senior citizens. This fast-food employment trend is the consequence of a tight labor market and the ageing population.

With their years of experience in the job market and purpose of work, seniors are competitive in these workplaces, a report from Bloomberg said.

The industry’s median hourly wage is $9.81 in 2017, according to the U.S. Bureau of Labor Statistics. With the same labor cost, chains could run their businesses by hiring seasoned workers who have spent decades in the job market. The senior workforce tends to possess well-developed interpersonal skills compared to the younger generation – a boon to employers as this could help reduce workplace conflicts.

The longer life expectancy and the elderly’s propensity to work would alter the employment landscape going forward. With the holiday season around the corner, the job market is expected to see a growing presence of senior workers.

Source:
https://www.bls.gov/careeroutlook/2017/article/older-workers.htm
https://www.bloomberg.com/news/articles/2018-11-05/senior-citizens-are-replacing-teenagers-at-fast-food-joints

If you were to ask me a year ago what I thought would be trending a year later, plastic straws definitely would not have been on my list.

I’d like to consider myself an advocate for sustainability: I’m vegan, I recycle and I try to repurpose items. Until recently, I had never considered that plastic straws — a commodity that’s unquestionably been available since the 1960s — placed any strain on the environment, businesses or the economy at large.

Well, turns out the impact of plastic straws, though present, is not nearly as severe as many hyped it up to be. With eight millions tons of plastic streaming into the ocean annually, straws only comprise 0.025 percent of that waste, according to National Geographic. The small-scale issue went mainstream this summer when Seattle — home of Starbucks and its famous plastic green straws — announced a ban on plastic straws and utensils at all food service businesses.

From there, the issue blew up on social media, with many claiming to be dedicated environmentalists because they now abstained from plastic straws. As Greenpeace has pointed out, however, 40 percent of plastics in the ocean are from single-use plastics, with plastic straws only making up a tiny fraction. According to Vox, The World Economic Forum reported that there are 150 million metric tons of plastic in the ocean, and scientists predict that by staying with this trend, there will be more plastic than fish in the ocean by 2050. As someone who comes from a coastal area where seafood is a huge market, that doesn’t sound like the best situation to be in.

Where plastic pollution sources from. Source: EcoWatch

So why focus on plastic straws at all? In the Business Insider video “Why plastic straws suck,” chief scientist for the Ocean Conservancy George Leonard notes how plastic straws are only the beginning.

“I think straws are a bit of a poster child here for the bigger question of society’s kind of over-reliance on single-use plastics and the fact that a lot of the stuff is ending up in our marine environment,”  Leonard said.

Biodegradable paper straws, which are slightly more expensive, have been introduced as an eco-friendly alternative to plastic straws, which can take 500 years to decompose, according to The Independent. Aardvark Straws, a paper straw manufacturer, has been a key player with introducing this change. When pulling up the company’s website, a banner at the top reads that overwhelming demand for paper straws has delayed shipping times, illustrating how consumers are eager to change their plastic usage. David Rhodes, Aardvark Straws’ global business director, told National Geographic that the economic value of paper versus plastic straws extends beyond business expenses.

“There’s no getting around that a paper straw will cost about a penny more than a plastic straw,” Rhodes said. “For large corporations, that equals hundreds of millions of dollars, but the cost to the marine environment, you can’t put a price on that.”

Aardvark Straws at work. Source: Imbibe

CNBC reported that paper straws cost 2 ½ cents each, as opposed to half-cent for plastic straws.

“You go from something that is very, very, very cheap, to something that is still actually cheap,” said Adam Merran, CEO of PacknWood, a food service products company, to CNBC.

That’s where the economics of plastic straws come in to play: changing drinking straw habits may affect business expenses, but the ultimate economic value comes with protecting the priceless marine environment in the long run.

According to the World Wildlife Fund, the direct output from coral reefs, seagrass, mangroves and marine fisheries is valued at $6.9 trillion U.S. dollars. Clearly, investing in eco-friendly habits now — even if they come at a higher cost — will allow natural resources to maintain (or potentially increase) their value in the future, which is beneficial to everyone.

Source: The World Wildlife Fund

Remember: plastic straws are only the beginning to revolutionizing consumers’ environmental and economic goals.

In the final days of October, news came out that President Trump wanted to use executive order to end birthright citizenship in the U.S. In an interview with Axios, President Trump said the United States is “the only country in the world where a person comes in and has a baby, and the baby is essentially a citizen of the United States for 85 years with all of those benefits”. Sticking to “America First”, he has been pushing hardline immigration policies to immigration issues.  

Although the news has aroused controversy in the U.S. and critics say President Trump has no rights to end birthright citizenship supported by the 14th Amendment, the news has still brought an anxiety to a group of people related to “birth tourism”.

Birth tourism gives pregnant women an opportunity traveling to and giving birth in another country for the purpose of obtaining citizenship for the child in a country with birthright citizenship. The United States is a popular destination for birth tourists. As long as pregnant women don’t lie on immigration or insurance paperwork, this practice is legal and protected by the 14th Amendment, which says anyone born on American soil is automatically a citizen. According to the Migration Policy Institute, more than 4 million children have the citizenship of the U.S. at birth.

Chinese pregnant women account for the majority of birth tourism group. According to Asian Americans and Pacific Islander Data, the total number of birth tourists from around the world to be about 36,000 per year, while other sources indicate the annual number of Chinese birth tourists to be around 20,000. Estimates by All America Mother Services Management Center in 2013 projected 60,000 Chinese births in 2016, more than 14 times as many as 2008, the first year Chinese people could apply for a U.S. Visitor Visa for tourism. the number of pregnant women coming to the U.S. has reached over 80,000, according to a Chinese research institution.

The reason that Chinese pregnant women choose to give birth in the U.S. has in common. The U.S. citizenship can allow their babies to enjoy advanced medical technology, good environment with clean air and water, advanced education resources and less-pressured course pressure. However, without the birthright citizenship supported by the U.S. Constitution, they would lose a way to give their babies a better life. There is no doubt that Trump’s opposition to birthright citizenship has brought them much anxiety.

Other than chinses pregnant women who want to give birth in the U.S., Trump’s proposition will also affect maternity hotel owners, who have been living in the U.S.

Maternity hotels sprang up over 30 years ago when Taiwanese chose to give birth in America to protect their children from mandatory military service. At first, these pregnant women lived with their relatives or friends waiting to give birth. However, as increasing numbers of pregnant Taiwanese women followed, the experienced in housing pregnant women sensed a fortune could be made. To accommodate the increasing number of pregnant women flocking to the U.S., maternity hotels offering comprehensive services for pregnant women sprang up. Los Angeles is the most popular destination for them. And when the U.S. Visitor Visa for tourism opened to Chinese citizens in 2008, the industry began an unprecedented boom.

Maternity hotels’ services include housing, cooking meals, appointing obstetricians, personal care by matrons, and driving. A large number of maternity hotels can produce many job opportunities and positions, for example, housekeepers, drivers, matrons, babysitters and obstetricians. According to a report of All America Mother Services Management Center, the maternity hotel industry chain in Los Angeles can support almost 10,000 people to make a living. However, if Trump succeeds in ending birthright citizenship, the whole industry will be affected.

While no one can predict the policy in immigration policies, the birth tourism and maternity hotel industry have an unsure future. The settled part is that Trump’s hardline attitudes toward immigration issues may have cracked down the industry.

It’s Tuesday, November 6^th. Tonight marks the conclusion of election day, the day where Americans will vote to elect or re-elect representatives in the House and the Senate, and, perhaps more importantly, voice the direction in which he or she thinks the country should move. Americans are opinionated, and they’re sharing that opinion. 36 million people voted early in this election, indicating a voting turnout some are comparing to a presidential election.

So why are Americans turning up to vote more than expected? They have something to say.

According to the Pew Research Center, immigration is a top priority for both Republicans and Democrats, and is the most important issue being voted on today among voters, a potential reason voters are showing up in staggering quantities at the polls. As a caravan of migrants moving from Central America towards the United States increasingly became an election strategy over the past two weeks, the topic has emerged as a “closing statement” on the campaign trail, making the issue more immediately relevant. And voters have strong opinions about this. Basic immigration literacy, however, like so many other policy issues, is largely disconnected from reality.

Americans have voiced that immigration policy is a top priority, even a reason they are showing up in record numbers at the polls, but data show that many fail to grasp basic facts about the subject.

More than 42% of individuals polled incorrectly identified that fewer than half of US immigrants are here legally. Current estimates suggest that around 75% of immigrants are in the United States legally. Perhaps even more alarming is the fact that immigration information, supposedly grounded in fact rather than opinion, is so starkly split along party lines.

The above graph, reporting public opinion about crime rates, shows a wide spread in public opinion—distinctively along party lines—regarding an issue that is theoretically nonpartisan.  While 42% of red voters believe that undocumented immigrants are more likely than US citizens to commit serious crimes, 12% of blue voters hold the same opinion, representing a 30% spread.

While the divide between the right and the left is ever-reported and increasingly evident in everyday interactions, this problem manifests itself in crucial policy discussions. Without basic knowledge of rudimentary facts—facts integral to voters’ most crucial issues—the public is useless in engaging in the meaningful and nuanced conversations that are required to debate immigration policy.

I would argue that the emphasis placed on immigration in the polls is both warranted and necessary. These policies are part of an elite group that impact almost every facet of the American story—GDP, employment, inequality, and social trajectory. But we cannot possibly discuss the true issues behind the policy—issues of economic value creation and job displacement and inequality enhancement—if we do not first address the fact that Americans don’t understand the issues we claim to care the most about.

We should fear—and fight—those who speak (and vote) without adequate information, regardless of what colors they wear.

A row of old warehouses came into the view as the car went pass the green Vincent Thomas Bridge to reach the coastline of southern San Pedro. Lindsay Cruver stopped at the spacious parking lot at Berth 58, locked the car and stepped into her office — two retrofitted shipping containers, orange and blue, with the company name Catalina Sea Ranch printed on them.

Catalina Sea Ranch is an offshore mussel farm operated in federal United States waters. Cruver has been working as a researcher for the company since its foundation two years ago.  “Our country is actually lagging behind in aquaculture,” Cruver said, “what we are doing is really to catch up with other countries and try to grow more seafood by ourselves.”

Over 90 percent of seafood consumed in the United States is imported. Nearly 65 percent of aquaculture production is inland and concentrated mostly in the tropical and subtropical regions of Asia.

In recent years, the United States has slid to 17th place in world farmed seafood production, slipping behind Myanmar and almost leveled with Malaysia, according to the Food and Agriculture Organization of the United Nations (FAO).

The country is consuming very little seafood. Compared to the recommended 20 percent, seafood accounted for 5 percent of total consumption from the protein foods group in 2014, which was dominated by meat and poultry.

Culturally, the Americans are more inclined to consume terrestrial meat than seafood. Beyond that, the country does not farm fish the way it farms cows and chickens. The amount of fish and shellfish harvested from the wild annually in this country is about 7 times greater than the amount produced by domestic aquaculture farms.

Now the search is on for a more sustainable way of getting food from the sea, as 85 percent of the world’s marine stocks are either fully exploited or overfished, World Wildlife Fund says.

One of the options would be developing sea ranches and farm fish in the ocean. But they are never perfect businesses as the aquaculture farms bear the risks of spreading diseases to wild fish, harming local habitat and impacting fishing activity.

Cruver said the it had been very hard for sea ranches, both coastal and offshore farms, to get permit. “It’s not just the regulators,” she said while pointing at the other side of the terminal island, “people who live there do not want to see warehouses and fishing nets – they want to have the view of the beautiful, clean sea surface.”

Due to the concern on aquaculture pollution and transmitted disease carried by the finfish, there had not been any permit given to offshore finfish producers. The shellfish farms are easier to manage, as mussels, oysters and clams do not move around, nor do they feed on small fishes. So, the Catalina Sea Ranch started as a pilot to farm shellfish. For now it is the only offshore sea ranch in Southern California.

It takes an hour for the boat to reach the sea farm from the port behind the warehouse. On the surface of the sea one could only see the floater and the data monitors powered by solar panels.

The ranch is underwater, where thousands of mussels were tied onto the grouped ropes. “Technically, the mussels grab onto the ropes,” Cruver said, “as they had numerous ‘hands’ called mussels threads.” When a mussel is put close to something, it naturally attaches itself to it within minutes using those threads.

The sea ranch currently sees a satisfying performance as it delivers 2 million pounds of mussels year-round to the retailers all over Southern California. It has to prepared itself for challenges, though. With climate change bearing down on the tropics, the changing ocean condition makes it more difficult to predict what’s going to happen for a business under the sea.

Cruver said that anyone in the west coast aquaculture industry would be familiar with the crisis confronted Whiskey Creek Shellfish Hatchery. In 2008, the hatchery almost went out of business as the baby oysters they attempted to produce wound up dead on the bottom of the tanks month after month, causing a 75 percent decrease in its oyster production in the year.

It turned out that the “ocean acidification,” a byproduct of climate change, is to blame, as opposed to foreign bacteria, which is a more commonly seen problem in sea farms. A study in 2009 by FAO predicted that it is likely that diseases affecting aquaculture would increase both in incidence and impact.

Multiple universities and research institutions are attempting to provide solutions to the chronic threats, as the human society needs to turn to the sea for more food in order to ease the resource-intense inland farming industry.

Sarah Lester, an assistant professor at Florida State University, recently found in her study that Southern California has huge potential for offshore ocean farming, as long as it was carefully planned.

This gives more weight to the two containers at the giant warehouse in San Pedro. Cruver and her other 20 colleagues will also have to be prepared for future competitions, as what they are doing is setting a pace for more new comers in this under explored business field.

1Malaysia Development Berhad (also known as 1MDB) is a multibillion sovereign wealth fund set up by the ex-Malaysian prime minister Najib Razak following his 2009 election victory, under the guise that it would finance projects like power plants to help the Malaysian people but in truth was one of the biggest frauds in history. Razak, the fund’s mastermind and so-called “Zelig of the good life” Jho Low, Malaysian politicians and global bankers were beneficiaries of this embezzlement. By diverting 1MDB funds to use for personal gain, they illegally acquired “billions of dollars worth of assets, including real estate, art, a luxury yacht and proceeds from the film The Wolf of Wall Street” (Bloomberg). The irony that a film about Jordan Belfort – a stockbroker who made untold riches and then was imprisoned for fraud – was financed with laundered money would be rich enough. This detail represents only a minuscule part of a scandal which has brought down a prime minister and now involves multinationals across nearly a dozen countries.

Court filings claim that, over the past decade, Razak’s personal bank accounts were filled with approximately $700 million of the fund’s assets. Upon learning of the prime minister’s central role in the fraud, Malaysians enacted deserved retribution by voting Razak out of office in January. Six months ago, the ruling Barisian Nasional coalition, which had been led by Razak’s party, lost command for the first time since Malaysia became an independent nation in 1957. The coalition officially disbanded in August. Malaysia’s central bank governor also resigned. As the scandal’s fallout has unexpectedly brought opposition leader Mahathir Mohamad, the nonagenarian former prime minister, to power, Malaysia teeters on the brink of legitimacy; it remains to be seen what measures will be taken to ensure the protection of its finances.

The penalties for Goldman Sachs, which earned an unusually high share of $600 million in commissions for underwriting three 1MDB bond offerings worth $6.5 billion, could be significant (FT). The firm, now under Justice Department investigation, has told investors this month that its “potential losses related to legal proceedings involving 1MDB could run as high as $1.8 billion” above initial estimates (FT). These allegations could damage Goldman’s reputation even more so than in the postscript to the 2008 financial crisis. Why? In this case, it is the senior members of the firm who have pleaded guilty to bribery, been indicted or placed on leave –– former partner Tim Leissner, former managing director Roger Ng, and co-head of Asian investment banking Andrea Vella, respectively (WSJ). Additionally, the bonds were approved by 30 executives, including immediate past head Lloyd Blankfein and newly appointed CEO David Solomon (FT). Overall, this scandal threatens to cast doubt on Solomon’s leadership abilities at the embryonic stages of his tenure as CEO and erase the goodwill Goldman has desperately sought to regain following massive fines paid out for its role in the crisis.

According to Britannica, “investigations launched by Swiss and U.S. authorities determined that an estimated $3.5 billion had been embezzled from 1MDB and laundered” around the world. Singapore, off of Malaysia’s coast, has barred multiple Swiss banks from operating within its borders due to their rule-breaking; Switzerland is delving deep into the books of J.P. Morgan Chase, Credit Suisse, UBS and other powerful financial institutions to determine possible crimes. The United States Department of Justice’s anti-kleptocracy unit seeks to recover billions in 1MDB assets – “the largest asset recovery operation in the organization’s history” (Bloomberg). While the scandal-plagued will face severe consequences, there is now cause for governments and international authorities to enact stringent laws – true global financial reform – vis-à-vis money laundering and corruption. It will be fascinating to see how Malaysian society and institutions throughout the world recover from this calamity.

Sources:

Billion Dollar Whale: The Man Who Fooled Wall Street, Hollywood, and the World, by Tom Wright and Bradley Hope, Hachette, RRP. 2018.

https://www.wsj.com/articles/goldman-disclosure-in-1mdb-probe-points-to-potential-control-culture-concerns-1541461239

https://www.channelnewsasia.com/news/commentary/malaysia-general-elections-ooi-kee-beng-rot-barisan-nasional-10221134

https://www.ft.com/content/76cd99b8-e0f8-11e8-a6e5-792428919cee?kbc=e09d5857-96d7-31aa-bdac-ae689cc95a53

https://www.bloomberg.com/graphics/2018-malaysia-1mdb/

https://www.bloomberg.com/news/articles/2018-05-24/how-malaysia-s-1mdb-scandal-shook-the-financial-world-quicktake

https://www.britannica.com/biography/Najib-Razak

https://www.wsj.com/articles/malaysias-1mdb-the-secret-money-behind-the-wolf-of-wall-street-1459531987

https://www.nytimes.com/2018/11/01/business/goldman-sachs-malaysia-investment-fund.html

Xinyan Zhang’s high school was in Beijing, and she got a score of 550 out of 710 in her gaokao, which is China’s National Higher Education Entrance Examination. She chose the Communication University of China, one of the top universities in China.

Because Zhang wanted to major in Broadcast Journalism, she took the arts exams with other applicants and ranked 71. When entering her college, Zhang felt very confident about her scores until she met three classmates from Jiangsu, ranking from 1-3 on the art exams.

Zhang would never forget the conversation between her and her Jiangsu classmates. Zhang’s classmates said it was impossible for them to come to the Communication University of China if their Arts exam rankings were not high.

This conclusion may all come from the different education policies made by the Chinese government based on the hukou system.

In China, the hukou system is a system of household registration, which identifies a person’s information including residence, name, parents, spouse and date of birth.

The government has dominated the gaokao examination, which is considered a fair game for each student. Especially in Beijing, the government don’t need many migrants and wants to make the scores of policymakers’ children look nicer.

Students usually go to their schools near their hukou, and they are required to take gaokao in their hukou location.

According to the local education bureau offices data, Beijing students like Zhang have a 25 percent chance to get into one of the government-identified top universities. However, Jiangsu students have a less than 10 percent chance to get into such universities.

China’s prestigious Peking University and Tsinghua University, which are both located in Beijing, take 84 students out of every 10,000 Beijingers, 14 out of every 10,000 Tianjiners (a city near Beijing), and only 2 out of every 10,000 Jiangsuers.

This condition has happened not only on Jiangsu students, but also students from Hunan, Hefei, Anhui, etc.

Zhang reminded her high school president talking about how the high school alumni met each other in Peking University and Tsinghua University. Each year, at least 100 students at her school have the chance to go to the two universities. In the entire Jiangsu province, less than 15 students may have the same opportunity, although the population of Jiangsu is 3.5 times larger than Beijing’s.

More importantly, the education quality and even the pressure on students are higher in Jiangsu. Because students have to take their province’s gaokao examinations during the same three-day gaokao period, the difficulty levels are different.

Students joked on Weibo, the Chinese Twitter, that Beijing’s gaokao is the easy mode, Tianjin’s is the medium mode, and Jiangsu’s is the hell mode.

Zhang said one of her classmates from Jiangsu always felt not confident even though she always had the best scores in class and got accepted by one of the top newsrooms in China.

Zhang also called herself a confident girl because she believed that students in Beijing had experienced the ‘encouraged education system.’

As the province that has the highest per capita GDP in China, Jiangsu’s total GDP was 7.06 trillion yuan in 2017. Therefore, some wealthy parents come with two ways to help their children overcome the education disadvantage.

Middle- or high-class parents ask their children to study English and send them to study abroad after graduation. Therefore, these students don’t have to tolerate the unfair competition with Beijing’s students.

On the other hand, more parents are coming up with new methods. In 2017, The China Daily reported on how did some Chinese parents purchase the Republic of Guinea’s citizenship for their children. Therefore, these local students became foreigners, took the easiest gaokao examinations designed for international students, and finally got into Peking University.

 

Sources:

https://www.businessinsider.com/maotanchang-gaokao-factory-town-2013-10

https://www.theatlantic.com/china/archive/2013/06/chinas-unfair-college-admissions-system/276995/

https://www.scmp.com/news/china/policies-politics/article/1945104/thousands-chinese-parents-take-streets-protest