International -- Readers Report
Greater China: Progress--and Misplaced Anxiety
Your impressive "Greater China" story (Special Report, Dec. 9) highlights something many may not realize: As long as pragmatic leadership remains, China will flourish and progress, while the countries ruled by religious conservatives will remain in poverty. Could BusinessWeek write a similarly hopeful report about the once-great countries of Egypt, Persia (Iran), Syria, Iraq, or Pakistan? These were the world powers in ancient history. In the Dark Ages, in Europe, while the Inquisition reigned, progress was stymied. As long as a radical religion suppresses the populations in these countries, they will not prosper either. All they can generate is hate--based on jealousy--and terrorism.
Robert Marx
Christchurch, New Zealand
If China is Taiwan's top export market, the destination of its foreign direct investment, and the top choice for foreign university education, then what is the basis of U.S. concern about China's invading Taiwan? The 500,000-plus Taiwanese who have become residents in China as a result of Taiwanese investment would indicate that it is Taiwan that has invaded China. Why is Washington obsessing about the dubious notion of China invading Taiwan? The facts presented and extrapolated speak otherwise.
Mohamed Cassam
Annandale, Va.
Why Profits Aren't Pouring in for Starbucks in Japan
Chester Dawson's statement that Starbucks Corp. is fighting 1,000 years of green-tea-sipping tradition ("Losing the taste for latte already?" Asian Business, Dec. 9) is exaggerated. It was only 400 years ago that the ceremony of tasting green tea became popular among highly ranked people. The main reason for Starbucks Japan's huge loss is that they continued to open outlets in the best locations in busy districts where land prices are extravagant. Now that people are tired of the Starbucks "brand," they are shifting to rival shops where better espresso and a greater variety of food are served at a more reasonable price.
Masanobu Okuda
Kawaguchi City, Japan
Editor's note: While it's true green tea wasn't popularized among the merchant class in Japan until the 16th century, it was first introduced from China in the 8th century, and the tea ceremony was imported early in the 12th century.
What Makes Microsoft Mighty? Not Innovation or Price
In "The best little monopoly in America" (Economic Viewpoint, Dec. 9), Robert J. Barro argues that Microsoft Corp. attained its dominant position by providing low-priced, innovative products that consumers valued. This is a theme that even by repetition does not become more truthful.
Low-priced? Today, I pay $1,500 for a computer with Microsoft Word installed. A steep price for, in essence, a glorified typewriter. Innovative? It is difficult to name a single product of Microsoft that is not a close copy of some other company's product, whether it is Windows, copied from Apple Computer; Word, copied from Wordperfect; Explorer, copied from Netscape Communicator; or Excel, copied from Quattro. Valued? To perceive a product to be highly valued by the customer because it is market-dominant is fundamentally flawed. Does the fact that prisoners live in cells mean that they value their cells more highly than 12-room mansions?
Microsoft's ability to maintain high profit margins despite low consumer confidence, low reliability, lack of innovation, and high prices is typical for almost any monopolist--just look at telecom and other former monopolies.
Christian Kober
Shanghai
Innovative products? Get real. Microsoft built its dominance on MS-DOS, a system William H. Gates III bought, not designed. Massachusetts' appeal in the Microsoft trial is our last chance to see Microsoft broken up. It might then even begin to write decent software, or at least let others do it if it can't.
Emanuel Falkenauer
Brussels
Boeing's Jet of the Future: Thanks, but No Thanks
After the "benefits" of open skies--cramped seats, geriatric aircraft, horrible service, and debatable price "reductions"--Boeing Co.'s great move forward is a plane with no windows, which soars and dips abruptly when turning and banking, placing strain on the hydraulic equipment ("The battle over a radical new plane," (Science & Technology, Nov. 25). Thank you, not for me. I'll stick to Airbus. Maybe your writer would enjoy test-flying the new design during heavy turbulence?
Daniel Sahagoff
Sao Paulo
A Good Stockpicker Is a Lucky Stockpicker
Instead of commenting on Eliot Spitzer's impolite public questioning of the financial industry's stockpicking ability, BusinessWeek would serve readers better with an impartial analysis of Spitzer's research on the quality of buy/sell recommendations of individual analysts ("That's giving them an earful, Eliot," American News, Dec. 2).
The claim of being able to pick winners consistently is in direct contradiction with financial theory. As one would expect, research has shown that analysts with a good stockpicking track record are probably just lucky (as opposed to skilled). Moreover, research has also shown that the best analysts stop being analysts: They become fund managers. Could it be that even the best analysts are not good enough for the real thing?
Just as consumers are protected against unproven health claims from food supplements, investors should know what to expect when swallowing their daily dose of stock pickings.
Pieter Wijnmaalen
Leiden, Netherlands
Bush's Tax Cut: On the Right Track
Income-tax collection is designed to pay for government "services," not act as a Great Society income-redistribution scheme ("Good news for Joe Trustfund, Bad news for Joe Sixpack" (Economic Viewpoint, Dec. 2). One must allocate any tax cut to the biggest payees, to have any impact. Who is Laura D'Andrea Tyson's "average American"? The nearly 50% who pay little or nothing? Bush's original tax-cut proposal was largely watered down by the Democrats in Congress, and payroll-tax-rate creep is largely an artifact of Tyson's party. We need a renewal of growth unhindered by government drag. I hope President Bush's policy is pro-business. That's where most employment and all wealth is generated.
Dick Wallin
London
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