Weekly reading 25th June 2022

What I wrote last week

Books on Payments

Supreme Court overturned Roe v Wade and took away abortion rights

Business

Inside the Reinvention of Albertsons Cos. The over-arching theme of Albertsons’ plan moving forward is to use technology and data to make decisions so that efficiency can improve and so does customer engagement. Grocery is a hard business. Margin is low and competition is fierce. Albertsons said their goal was to have shoppers complete grocery shopping at their stores without visiting rivals’ footprint while offering local assortments. It means that the selection has to be broad, but the stores at the same time cannot expand in size forever. They also need to keep a close eye on costs and margin as well. That would require a lot of data analytics, coordination in the case of omni-channel shopping and great execution.

($) Retailers’ Inventories Pile Up as Lead Times Grow. On top of the ever-changing consumer behavior and sky-high inflation, retailers now have to deal with long lead times in production which make it even more difficult to match demand with supply while keeping costs in check. Hold a lot of the wrong inventory to avoid supply chain and production issues, and you will be punished like Walmart or Target. Be nimble with inventory and you don’t have well-stocked shelves to woo customers. Hard times ahead.

Consumer watchdog eyes crackdown on credit card late fees as inflation threatens to increase them. If CFPB introduces regulations on late fees, it will affect how issuers generate revenue from credit cards. Late fee is a significant source of revenue by itself, but it also encourages consumers to pay off balance to avoid further penalty. If late fees are further capped or even outright banned, such an incentive will go away and consumers may carry more balance. It will increase risks and reduce revenue for issuers. It’ll be interesting to see how this develops.

($) Canada to Compel YouTube, TikTok and Streamers to Boost Domestic Content. I am generally supportive of having the right kind of regulations in place to help businesses. Hence, I would be in favor of the Canadian government giving these streamers incentives to promote Canadian creators’ work. I am not; however, ok with a government mandating a preference of local content.

($) GM and Ford, Driving to Beat Tesla, Turn on Each Other. An interesting read on how two iconic American car manufacturers are going at each other for market shares in the EV area.

($) How Singapore Got Its Manufacturing Mojo Back. “In courting factories like this, Singapore has become a rare wealthy country to reverse its manufacturing downturn. The city-state had faced industrial decline, with World Bank figures showing manufacturing falling to 18% of gross domestic product in 2013, from 27% in 2005. Then manufacturing made a comeback in Singapore, rising to 21% of GDP in 2020, according to the World Bank’s latest figures. Singapore has aggressively wooed highly automated factories with tax breaks, research partnerships, subsidized worker training and grants to local manufacturers to upgrade operations to better support multinational companies, among other enticements. There’s a caveat: Singapore’s success has come by automating away many jobs. It has more factory robots per employee than any country other than South Korea. Business executives say Singapore has succeeded because it has a welcoming, low-tax government and a strong base of English-speaking science, engineering and mathematics graduates and manufacturing managers. Relatively loose immigration laws make it easy to hire foreign engineers.  Executives also say they trust intellectual-property protection laws in Singapore, unlike in places like China where they sometimes worry their partners will copy their products.”

Source: Twitter

Other stuff I find interesting

Japan to subsidize TSMC’s Kumamoto plant by up to $3.5bn. Semiconductor companies get handsome subsidies from governments from all over the world. Japan will give TSMC $3.5 billion while Europe hands Intel billions of euros to build a plant there. That goes to show how countries value the strategic importance of semiconductor going forward

Why America Will Lose Semiconductors. A good run-down of problems that America faces in semiconductor. It’s a nice complementary read to the previous link

Friendly fungi help forests fight climate change. “A 2016 study led by researchers from Imperial College London revealed that one particular type – ectomycorrhizal fungi – enables certain trees to absorb CO2 faster (and therefore grow faster) than others. This is known as the “CO2 fertilisation effect”. These fungi live in the root system of a host tree. In a symbiotic relationship, fungi help the tree to absorb more water, carbon and other nutrients. In exchange, the tree provides food for the fungi by photosynthesising. Ectomycorrhizal fungi have also been found to slow down the process of rotting; decomposition breaks down all that locked-away carbon and releases it into the atmosphere. So the fungi, in effect, have two methods of fighting global warming.”

The most dangerous place on Earth. “Nestled on Lithuania’s southeastern border, Druskininkai opens onto a narrow notch of strategic territory known as the Suwałki Gap. Stretching about 100 kilometers along the Lithuanian-Polish frontier, between Belarus in the east and the Russian exclave of Kaliningrad to the west, Western military planners warn the area would likely be one of the Russian president’s first targets were he ever to choose to escalate the war in Ukraine into a kinetic confrontation with NATO.”

($) Erdogan Is Hung Up on the Power One Kurdish Woman Has in Sweden. “Amineh Kakabaveh’s journey from Peshmerga fighter to Kurdish refugee and then Swedish lawmaker has thrust her into her adopted homeland’s standoff with Turkey. Turkish President Recep Tayyip Erdogan is holding up Sweden’s application to join the NATO alliance, saying it harbors “terrorists” — his catch-all label for those with links to Kurdish militancy — and he’s hinted at Kakabaveh’s influence as a particular problem.”. Just an amazing story by Amineh

Stats

Edmunds reported that the average price of an EV exceeded $60,000

Since November 2021, more than $2 trillion in cryptocurrency value has evaporated

Covid vaccines saved 20 million lives in the first year

TikTok had $4 billion in revenue in 2021. Its US-based users spent on average 29 hours on the platform, compared to 16 hours on Facebook and 8 on Instagram

Source: IMF

Supreme Court overturned Roe v Wade and took away rights to abortion

Today, the Supreme Court overturned a long-standing precedent in Roe v Wade and outlawed abortion. The Court’s opinions were leaked a while ago, but when the news broke, it’s still as devastating.

When I was younger, I used to mistakenly think that the Founders were so brilliant that the Constitution stood the test of time with few changes. “How could they think THAT far ahead?”, I naively thought. The truth is that the more time I spend in the US, the more I realize that they did NOT think that far ahead. They did what they could and it’s nobody’s fault that they couldn’t foresee what happens almost 250 years later. How could they foresee the radicalization in ideologies that plague our society nowadays? How could they foresee a society where it’s more of a hobby to own a gun than a necessity and where guns kill children far too often than anyone could imagine? How could they foresee a society where women are NOT second-class citizens and they have rights to their bodies?

I understand that opinions on gun control and abortion vary significantly across the US. But in a democracy, the policies should reflect the will of the majority. The fact of the matter is that the majority of Americans support abortion and think it should be legal, at least to some extent. By declaring that the Constitution doesn’t automatically give citizens the rights to abortion, the Court allows states with draconian policies to dictate what women CANNOT do in any circumstances. How can we call this a democracy when the will of the majority is cruelly ignored?

A few days ago, the Supreme Court allowed open carry in the state of New York, citing the 2nd Amendment. Here is what the 2nd Amendment says

A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.

Since we tend to scrutinize every word in the Constitution, let’s look at the two key phrases: well regulated Militia and the right. America is the lone outlier among developed countries when it comes to gun homicide. And not for a good reason. It’s unthinkable how many mass shootings we have in the country. It’s even less fathomable to imagine teenagers that are not old enough to drink yet are old enough to buy military grade and kill kids at school. Does that sound like well regulated to you? Furthermore, if the Amendment itself includes the word “regulate”, more regulations on gun control do NOT mean the infringement of the rights. We have the right to express ourselves, yet we have a bunch of laws that dictate what we can or cannot do. Then how is it that we are more gung-ho on this gun control issue more than we are on others? Nobody ever proposed that we don’t have the right to bear arms. It’s just that we have the responsibility to make sure arms are in the right hands.

Why do I mention gun control? To demonstrate the head-spinning reality in the US. We allow open carry in public, discarding the risk to human life, yet we outlaw abortion because we want to protect fetus. It doesn’t sound logical to me. It doesn’t sound like a society well-run by the rule of law and common sense. It sure doesn’t sound like something worthy of the Greatest Country status.

As disappointed as I am today, I am more fearful for what is coming next. Appointments to the highest Court in the land are life-time. These judges are here to stay. Their ideologies are here to stay. For citizens to moot this kind of opinions from the Court, there must be codified laws. Unfortunately, Congress is as broken as they come. Given that Republicans are all but guaranteed to win back the House, the Senate and likely the White House as well, chances of new meaningful and reasonable laws to protect citizens’ rights and safety are as slim as none.

Below are some of the notes I took from reading the opinion of the dissenting Justices

The lone rationale for what the majority does today is that the right to elect an abortion is not “deeply rooted in history”: Not until Roe, the majority argues, did people think abortion fell within the Constitution’s guarantee of liberty. The same could be said, though, of most of the rights the majority claims it is not tampering with. The majority could write just as long an opinion showing, for example, that until the mid-20th century, “there was no support in American law for a constitutional right to obtain [contraceptives].” So one of two things must be true. Either the majority does not really believe in its own reasoning. Or if it does, all rights that have no history stretching back to the mid- 19th century are insecure. Either the mass of the majority’s opinion is hypocrisy, or additional constitutional rights are under threat. It is one or the other.

Source: https://www.supremecourt.gov/opinions/21pdf/19-1392_6j37.pdf

The Court knew that Americans hold profoundly different views about the “moral[ity]” of “terminating a pregnancy, even in its earliest stage.” And the Court recognized that “the State has legitimate interests from the outset of the preg- nancy in protecting” the “life of the fetus that may become a child.” So the Court struck a balance, as it often does when values and goals compete. It held that the State could prohibit abortions after fetal viability, so long as the ban contained exceptions to safeguard a woman’s life or health. It held that even before viability, the State could regulate the abortion procedure in multiple and meaningful ways. But until the viability line was crossed, the Court held, a State could not impose a “substantial obstacle” on a woman’s “right to elect the procedure” as she (not the government) thought proper, in light of all the circumstances and complexities of her own life.

Today, the Court discards that balance. It says that from the very moment of fertilization, a woman has no rights to speak of. A State can force her to bring a pregnancy to term, even at the steepest personal and familial costs. Some States have enacted laws extending to all forms of abortion procedure, including taking medication in one’s own home. They have passed laws without any exceptions for when the woman is the victim of rape or incest. Under those laws, a woman will have to bear her rapist’s child or a young girl her father’s—no matter if doing so will destroy her life.

Source: https://www.supremecourt.gov/opinions/21pdf/19-1392_6j37.pdf

The majority’s core legal postulate, then, is that we in the 21st century must read the Fourteenth Amendment just as its ratifiers did. And that is indeed what the majority emphasizes over and over again. If the ratifiers did not understand something as central to freedom, then neither can we. Or said more particularly: If those people did not understand reproductive rights as part of the guarantee of liberty conferred in the Fourteenth Amendment, then those rights do not exist.

As an initial matter, note a mistake in the just preceding sentence. We referred there to the “people” who ratified the Fourteenth Amendment: What rights did those “people” have in their heads at the time? But, of course, “people” did not ratify the Fourteenth Amendment. Men did. So it is perhaps not so surprising that the ratifiers were not perfectly attuned to the importance of reproductive rights for women’s liberty, or for their capacity to participate as equal members of our Nation. Indeed, the ratifiers—both in 1868 and when the original Constitution was approved in 1788 did not understand women as full members of the community embraced by the phrase “We the People.” In 1868, the first wave of American feminists were explicitly told—of course by men—that it was not their time to seek constitutional protections. (Women would not get even the vote for another half-century.) To be sure, most women in 1868 also had a foreshortened view of their rights: If most men could not then imagine giving women control over their bodies, most women could not imagine having that kind of auton- omy. But that takes away nothing from the core point. Those responsible for the original Constitution, including the Fourteenth Amendment, did not perceive women as equals, and did not recognize women’s rights. When the majority says that we must read our foundational charter as viewed at the time of ratification (except that we may also check it against the Dark Ages), it consigns women to second-class citizenship.

Source: https://www.supremecourt.gov/opinions/21pdf/19-1392_6j37.pdf

Stare decisis also “contributes to the integrity of our constitutional system of government” by ensuring that decisions “are founded in the law rather than in the proclivities of individuals.” As Hamilton wrote: It “avoid[s] an arbitrary discretion in the courts.” And as Blackstone said before him: It “keep[s] the scale of justice even and steady, and not liable to waver with every new judge’s opinion.”

So how does that approach prevent the “scale of justice” from “waver[ing] with every new judge’s opinion”? It does not. It makes radical change too easy and too fast, based on nothing more than the new views of new judges. The majority has overruled Roe and Casey for one and only one reason: because it has always despised them, and now it has the votes to discard them. The majority thereby substitutes a rule by judges for the rule of law.