31
Business & Entrepreneurship / Re: What is a contra revenue account?
« on: April 11, 2017, 07:16:13 PM »
Yes, exactly
News:
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32
Business & Entrepreneurship / Re: What's the difference between accrued expenses and accounts payable?
« on: April 11, 2017, 07:13:39 PM »
You're right
33
Business & Entrepreneurship / Re: What is zero-based budgeting?
« on: April 11, 2017, 07:12:22 PM »
Thanks
34
Business & Entrepreneurship / What is zero-based budgeting?
« on: April 08, 2017, 10:38:20 PM »
What is zero-based budgeting?
Zero-based budgeting, or ZBB, is a rigorous budgeting process that requires every dollar of every expense to be justified even if the expense has been occurring for many years. For example, if a company has been spending $100,000 each year for the rent of warehouse space, the zero-based budgeting process assumes that nothing was spent previously. As a result, the warehousing activities must be reviewed, justified and documented before any amount can be included in the budget.
Zero-based budgeting is in contrast to more common budgeting practices that focus on the incremental change from the current expenses and current budget. In other words, under a more typical budgeting process, the $100,000 of rent expense is accepted and the focus is on whether the rent for the upcoming budget should assume an inflation adjustment of $3,000 or some other amount.
While zero-based budgeting will be far more time consuming than focusing on the incremental changes for the next budget, it can result in significant cost savings. For instance, the analysis and documentation of the warehousing activities required by zero-based budgeting could lead to a better use of space, better inventory management, etc. If those efficiencies will occur, the budget for the warehousing may need to be only $60,000 (instead of more than $100,000).
Zero-based budgeting was widely discussed in the 1970s for businesses and governments. Today, it is again being discussed since a few large corporations have used ZBB budgeting process to significantly reduce unneeded expenses.
Zero-based budgeting, or ZBB, is a rigorous budgeting process that requires every dollar of every expense to be justified even if the expense has been occurring for many years. For example, if a company has been spending $100,000 each year for the rent of warehouse space, the zero-based budgeting process assumes that nothing was spent previously. As a result, the warehousing activities must be reviewed, justified and documented before any amount can be included in the budget.
Zero-based budgeting is in contrast to more common budgeting practices that focus on the incremental change from the current expenses and current budget. In other words, under a more typical budgeting process, the $100,000 of rent expense is accepted and the focus is on whether the rent for the upcoming budget should assume an inflation adjustment of $3,000 or some other amount.
While zero-based budgeting will be far more time consuming than focusing on the incremental changes for the next budget, it can result in significant cost savings. For instance, the analysis and documentation of the warehousing activities required by zero-based budgeting could lead to a better use of space, better inventory management, etc. If those efficiencies will occur, the budget for the warehousing may need to be only $60,000 (instead of more than $100,000).
Zero-based budgeting was widely discussed in the 1970s for businesses and governments. Today, it is again being discussed since a few large corporations have used ZBB budgeting process to significantly reduce unneeded expenses.
35
Business & Entrepreneurship / What is a contra revenue account?
« on: April 08, 2017, 02:22:55 PM »
What is a contra revenue account?
A contra revenue account might be described as a revenue account that is expected to have a debit balance instead of the usual credit balance. (Its balance is contrary to—or opposite of—the usual credit balance for a revenue account.)
Another description of a contra revenue account is one that reduces the amounts reported in a company's revenue accounts. A contra revenue account reduces a company's gross revenues to net revenues.
Here is an example to illustrate what we have described. If Company K sells $100,000 of merchandise on credit, the accounting entry is a debit to Accounts Receivable for $100,000 and a credit to Sales for $100,000. If customers return $500 of this merchandise, Company K will debit Sales Returns and Allowances (a contra revenue account) for $500 and will credit Accounts Receivable for $500. Company K's income statement will report Gross Sales of $100,000 less Sales Returns and Allowances of $500 resulting in Net Sales of $99,500.
By debiting the contra revenue account for the returns and allowances, Company K's management can easily see the amount originally sold and the amounts that were either returned or an allowance was given to avoid the return. (This information is important because it is costly for a company to incur the cost of shipping the goods and then to incur the cost of processing the same goods back into inventory—with no revenue!) If the returns were debited into the Sales account (instead of into Sales Returns and Allowances), the amount of the returns would be "buried" in the Sales account.
Another example of a contra revenue account is Sales Discounts. Sales discounts occur when a company offers a discount (such as 1% or 2% of the invoice amount if it is paid within 10 days instead of the company's normal 30 day period) and the customer remits the amount due within the 10 day period.
A contra revenue account might be described as a revenue account that is expected to have a debit balance instead of the usual credit balance. (Its balance is contrary to—or opposite of—the usual credit balance for a revenue account.)
Another description of a contra revenue account is one that reduces the amounts reported in a company's revenue accounts. A contra revenue account reduces a company's gross revenues to net revenues.
Here is an example to illustrate what we have described. If Company K sells $100,000 of merchandise on credit, the accounting entry is a debit to Accounts Receivable for $100,000 and a credit to Sales for $100,000. If customers return $500 of this merchandise, Company K will debit Sales Returns and Allowances (a contra revenue account) for $500 and will credit Accounts Receivable for $500. Company K's income statement will report Gross Sales of $100,000 less Sales Returns and Allowances of $500 resulting in Net Sales of $99,500.
By debiting the contra revenue account for the returns and allowances, Company K's management can easily see the amount originally sold and the amounts that were either returned or an allowance was given to avoid the return. (This information is important because it is costly for a company to incur the cost of shipping the goods and then to incur the cost of processing the same goods back into inventory—with no revenue!) If the returns were debited into the Sales account (instead of into Sales Returns and Allowances), the amount of the returns would be "buried" in the Sales account.
Another example of a contra revenue account is Sales Discounts. Sales discounts occur when a company offers a discount (such as 1% or 2% of the invoice amount if it is paid within 10 days instead of the company's normal 30 day period) and the customer remits the amount due within the 10 day period.
36
Business & Entrepreneurship / What's the difference between accrued expenses and accounts payable?
« on: April 05, 2017, 11:27:22 PM »
What's the difference between accrued expenses and accounts payable?
Accrued expenses are payments that a company is obligated to pay in the future for which goods and services have already been delivered. These types of expenses are realized on the balance sheet and are usually current liabilities. The accrued liabilities are adjusted and recognized on the balance sheet at the end of each accounting period; adjustments are used to document goods and services that have been delivered but not yet billed. An example of an accrued expense would be a case where a company uses utilities for the month but has not yet been sent an invoice before the end of the period, when it has to close the books.
Accounts payable are a company's ongoing expenses that are typically short-term debts that must be paid off in a specified period to avoid default. They are considered to be current liabilities because the payment is usually due within one year of the date of the transaction. Accounts payable is the total amount of debt the company has to pay to its creditors for goods or services bought on credit. On the other hand, accrued expenses is the total liability that is payable for goods and services that have been received but not been billed. Accounts payable are recognized on the balance sheet when the company buys goods or services on credit. Accrued expenses are realized on the balance sheet at the end of a company's accounting period, when they are recognized by adjusting journal entries in the company's ledger.
Read more: What's the difference between accrued expenses and accounts payable? | Investopedia http://www.investopedia.com/ask/answers/031015/whats-difference-between-accrued-expenses-and-accounts-payable.asp#ixzz4dOeoUmqR
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Accrued expenses are payments that a company is obligated to pay in the future for which goods and services have already been delivered. These types of expenses are realized on the balance sheet and are usually current liabilities. The accrued liabilities are adjusted and recognized on the balance sheet at the end of each accounting period; adjustments are used to document goods and services that have been delivered but not yet billed. An example of an accrued expense would be a case where a company uses utilities for the month but has not yet been sent an invoice before the end of the period, when it has to close the books.
Accounts payable are a company's ongoing expenses that are typically short-term debts that must be paid off in a specified period to avoid default. They are considered to be current liabilities because the payment is usually due within one year of the date of the transaction. Accounts payable is the total amount of debt the company has to pay to its creditors for goods or services bought on credit. On the other hand, accrued expenses is the total liability that is payable for goods and services that have been received but not been billed. Accounts payable are recognized on the balance sheet when the company buys goods or services on credit. Accrued expenses are realized on the balance sheet at the end of a company's accounting period, when they are recognized by adjusting journal entries in the company's ledger.
Read more: What's the difference between accrued expenses and accounts payable? | Investopedia http://www.investopedia.com/ask/answers/031015/whats-difference-between-accrued-expenses-and-accounts-payable.asp#ixzz4dOeoUmqR
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37
Business & Entrepreneurship / Less busy, more productive
« on: April 05, 2017, 03:55:32 PM »
Less busy, more productive
Time management continues to be another challenge for many accountants, particular those who are also business owners. Getting bogged down with day-to-day tasks is not only time consuming, it also cuts into the time that should be devoted to strategic planning. As we all know, being busy isn’t necessarily the same as being productive — plus it can impact your bottom line.
A great way to manage your time more effectively is to classify your tasks based on their relative urgency and importance. This will help you see which of the less important tasks end up consuming most of your time, and which of the more important tasks you’re neglecting
An easy but useful tool to use is the Eisenhower Decision Matrix, which categories tasks as:
#Urgent and important
#Important but not urgent
#Urgent but not important
#Not urgent and not important.
You should be aiming to spend most of your time on tasks that are important but not urgent — that is, the ones that allow you to be productive and creative, and which contribute to your business’s future. You can achieve this by dividing up larger tasks into manageable portions and delegating less important tasks to junior staff members.
But remember, before you can delegate confidently you need to equip your staff with the skills and knowledge they need to succeed. By investing in the development of your staff, they’ll be ready to handle urgent tasks without you when they next arise. It also means each team member will become more engaged — and more accountable — in their role.
Time management continues to be another challenge for many accountants, particular those who are also business owners. Getting bogged down with day-to-day tasks is not only time consuming, it also cuts into the time that should be devoted to strategic planning. As we all know, being busy isn’t necessarily the same as being productive — plus it can impact your bottom line.
A great way to manage your time more effectively is to classify your tasks based on their relative urgency and importance. This will help you see which of the less important tasks end up consuming most of your time, and which of the more important tasks you’re neglecting
An easy but useful tool to use is the Eisenhower Decision Matrix, which categories tasks as:
#Urgent and important
#Important but not urgent
#Urgent but not important
#Not urgent and not important.
You should be aiming to spend most of your time on tasks that are important but not urgent — that is, the ones that allow you to be productive and creative, and which contribute to your business’s future. You can achieve this by dividing up larger tasks into manageable portions and delegating less important tasks to junior staff members.
But remember, before you can delegate confidently you need to equip your staff with the skills and knowledge they need to succeed. By investing in the development of your staff, they’ll be ready to handle urgent tasks without you when they next arise. It also means each team member will become more engaged — and more accountable — in their role.
38
Business & Entrepreneurship / Difference Between Economic and Accounting Profit
« on: April 04, 2017, 05:06:31 PM »
Difference Between Economic and Accounting Profit
Economic profit consists of revenue minus implicit (opportunity) and explicit (monetary) costs; accounting profit consists of revenue minus explicit costs.
KEY POINTS:
#Explicit costs are monetary costs a firm has. Implicit costs are the opportunity costs of a firm's resources.
#Accounting profit is the monetary costs a firm pays out and the revenue a firm receives. It is the bookkeeping profit, and it is higher than economic profit. Accounting profit = total monetary revenue- total costs.
#Economic profit is the monetary costs and opportunity costs a firm pays and the revenue a firm receives. Economic profit = total revenue - (explicit costs + implicit costs).
#Explicit cost
A direct payment made to others in the course of running a business, such as wages, rent, and materials, as opposed to implicit costs, which are those where no actual payment is made.
#Implicit cost
The opportunity cost equal to what a firm must give up in order to use factors which it neither purchases nor hires.
#Economic profit
The difference between the total revenue received by the firm from its sales and the total opportunity costs of all the resources used by the firm.
#Accounting profit
The total revenue minus costs, properly chargeable against goods sold.
EXAMPLE
Consider a simplified example of a firm. In one year, it cost $60,000 to maintain production, but earned $100,000 in revenue. The accounting profit would be $40,000 ($100,000 in revenue - $60,000 in explicit costs). However, if the firm could have made $50,000 by renting its land and capital, its economic profit would be a loss of $10,000 ($100,000 in revenue - $60,000 in explicit costs - $50,000 in opportunity costs).
The term "profit" may bring images of money to mind, but to economists, profit encompasses more than just cash. In general, profit is the difference between costs and revenue, but there is a difference between accounting profit and economic profit. The biggest difference between accounting and economic profit is that economic profit reflects explicit and implicit costs, while accounting profit considers only explicit costs.
Explicit and Implicit Costs
Explicit costs are costs that involve direct monetary payment. Wages paid to workers, rent paid to a landowner, and material costs paid to a supplier are all examples of explicit costs.
In contrast, implicit costs are the opportunity costs of factors of production that a producer already owns. The implicit cost is what the firm must give up in order to use its resources; in other words, an implicit cost is any cost that results from using an asset instead of renting, selling, or lending it. For example, a paper production firm may own a grove of trees. The implicit cost of that natural resource is the potential market price the firm could receive if it sold it as lumber instead of using it for paper production.
Accounting Profit
Accounting profit is the difference between total monetary revenue and total monetary costs, and is computed by using generally accepted accounting principles (GAAP). Put another way, accounting profit is the same as bookkeeping costs and consists of credits and debits on a firm's balance sheet. These consist of the explicit costs a firm has to maintain production (for example, wages, rent, and material costs). The monetary revenue is what a firm receives after selling its product in the market.
Accounting profit is also limited in its time scope; generally, accounting profit only considers the costs and revenue of a single period of time, such as a fiscal quarter or year.
Economic Profit
Economic profit is the difference between total monetary revenue and total costs, but total costs include both explicit and implicit costs. Economic profit includes the opportunity costs associated with production and is therefore lower than accounting profit. Economic profit also accounts for a longer span of time than accounting profit. Economists often consider long-term economic profit to decide if a firm should enter or exit a market.
Economic profit consists of revenue minus implicit (opportunity) and explicit (monetary) costs; accounting profit consists of revenue minus explicit costs.
KEY POINTS:
#Explicit costs are monetary costs a firm has. Implicit costs are the opportunity costs of a firm's resources.
#Accounting profit is the monetary costs a firm pays out and the revenue a firm receives. It is the bookkeeping profit, and it is higher than economic profit. Accounting profit = total monetary revenue- total costs.
#Economic profit is the monetary costs and opportunity costs a firm pays and the revenue a firm receives. Economic profit = total revenue - (explicit costs + implicit costs).
#Explicit cost
A direct payment made to others in the course of running a business, such as wages, rent, and materials, as opposed to implicit costs, which are those where no actual payment is made.
#Implicit cost
The opportunity cost equal to what a firm must give up in order to use factors which it neither purchases nor hires.
#Economic profit
The difference between the total revenue received by the firm from its sales and the total opportunity costs of all the resources used by the firm.
#Accounting profit
The total revenue minus costs, properly chargeable against goods sold.
EXAMPLE
Consider a simplified example of a firm. In one year, it cost $60,000 to maintain production, but earned $100,000 in revenue. The accounting profit would be $40,000 ($100,000 in revenue - $60,000 in explicit costs). However, if the firm could have made $50,000 by renting its land and capital, its economic profit would be a loss of $10,000 ($100,000 in revenue - $60,000 in explicit costs - $50,000 in opportunity costs).
The term "profit" may bring images of money to mind, but to economists, profit encompasses more than just cash. In general, profit is the difference between costs and revenue, but there is a difference between accounting profit and economic profit. The biggest difference between accounting and economic profit is that economic profit reflects explicit and implicit costs, while accounting profit considers only explicit costs.
Explicit and Implicit Costs
Explicit costs are costs that involve direct monetary payment. Wages paid to workers, rent paid to a landowner, and material costs paid to a supplier are all examples of explicit costs.
In contrast, implicit costs are the opportunity costs of factors of production that a producer already owns. The implicit cost is what the firm must give up in order to use its resources; in other words, an implicit cost is any cost that results from using an asset instead of renting, selling, or lending it. For example, a paper production firm may own a grove of trees. The implicit cost of that natural resource is the potential market price the firm could receive if it sold it as lumber instead of using it for paper production.
Accounting Profit
Accounting profit is the difference between total monetary revenue and total monetary costs, and is computed by using generally accepted accounting principles (GAAP). Put another way, accounting profit is the same as bookkeeping costs and consists of credits and debits on a firm's balance sheet. These consist of the explicit costs a firm has to maintain production (for example, wages, rent, and material costs). The monetary revenue is what a firm receives after selling its product in the market.
Accounting profit is also limited in its time scope; generally, accounting profit only considers the costs and revenue of a single period of time, such as a fiscal quarter or year.
Economic Profit
Economic profit is the difference between total monetary revenue and total costs, but total costs include both explicit and implicit costs. Economic profit includes the opportunity costs associated with production and is therefore lower than accounting profit. Economic profit also accounts for a longer span of time than accounting profit. Economists often consider long-term economic profit to decide if a firm should enter or exit a market.
39
Allied Health Science / These U.S. Kids Have Higher Autism Risk Under New EPA Rule
« on: April 04, 2017, 03:00:59 PM »
These U.S. Kids Have Higher Autism Risk Under New EPA Rule
by Deena Shanker
April 3, 2017, 3:00 PM GMT+6
https://www.bloomberg.com/news/articles/2017-04-03/trump-s-pesticide-order-leaves-some-kids-at-higher-risk
Anyone reading about the Trump administration refusal to block agricultural use of a dangerous pesticide may find themselves staring at a bag of oranges, thinking: Will these hurt my family?
Probably not. While consumers trundling through supermarkets across the country worry about their children, those most at risk are a smaller group: mostly Hispanic, their parents are often the undocumented immigrants who live near farms and pick the pesticide-laden produce.
On Wednesday, Scott Pruitt, the new head of the U.S. Environmental Protection Agency, signed an order (PDF) effectively rejecting his agency’s advice to ban chlorpyrifos, a popular (PDF) insecticide, from being used to keep bugs off such crops as walnuts, broccoli, and oranges. Chlorpyrifos is a member of the pesticide class organophosphates. Multiple studies show that eating food grown with the pesticide will in turn expose you to it, with children especially susceptible to its risks. But it’s far worse for those who live and work around the chemical, and worse still if they do both.
A November 2016 report from the EPA’s Office of Chemical Safety and Pollution Prevention found that just by eating such produce, children one to two years of age get a dose that’s 140 times the agency’s safety threshold. While a 2010 study found an association between organophosphate exposure and attention deficit/hyperactivity disorder, it didn’t establish a causal link. The data were also weighted to represent the entire U.S. population of children aged 8 to 15.
A nexus, however, becomes clearer when examining populations closest to where the pesticides are used.
Multiple studies show a connection between prenatal exposure in pregnant women and poorer cognitive function in their offspring. Among these was a 2011 study (PDF) of 329 children of predominantly Mexican-American farmworkers in California’s Salinas Valley, frequently referred to as the world’s “salad bowl.” Researchers found that 7-year-old children born to mothers with the highest levels of prenatal organophosphate exposure had IQs an average of seven points lower than mothers who had lower exposure levels. A 2014 University of California-Davis study found that children of mothers who, during their second trimester, lived within 1.5 kilometers of chlorpyrifos-treated fields were more than three times more likely to develop autism. (Other studies evaluating impacts of organophosphates used as pesticides in the home have reached similar conclusions; notably, the EPA banned chlorpyrifos for most household uses in 2000.)
A 2014 report (PDF) from the California Department of Public Health underscored the racial disparity at play in the pesticide’s deployment. In examining the 15 counties with the most agricultural use, it found that Hispanic children were 46 percent likelier than their white counterparts to attend schools within a quarter-mile of pesticide use. As pesticide intensity increased, so did the disparity: Hispanic children were 91 percent more likely to attend a school near the highest level of pesticide use than were white children.
Even without stepping foot on a field, members of farmworkers’ families are exposed through drift and what sticks to bodies and clothes, said Miriam Rotkin-Ellman, a senior scientist at the Natural Resources Defense Council. The children are often exposed through diet as well—what she called a “double whammy.”
The EPA and CropLife America, the national trade association representing pesticide makers, didn’t respond to requests for comment on any disparate impact of chlorpyrifos use. In a statement March 30, CropLife called a study describing the chemical’s risks “unreliable” while hailing the administration decision as “a hopeful indication that the EPA is recommitting to adherence to established requirements and guidelines relating to transparency, public process, and scientific integrity."
ngel Garcia, a organizer with El Quinto Sol de America, a farmworker advocacy group in California’s Tulare County, warns that the EPA decision will “negatively impact these communities.” Sarah Aird, co-director of the Californians for Pesticide Reform coalition, ascribed political motivation to the Trump administration’s decision, noting the disproportionate impact the pesticide has on rural communities that attract undocumented immigrants in search of work.
“It’s up to California to step up to protect the most disenfranchised among us,” Aird said.
by Deena Shanker
April 3, 2017, 3:00 PM GMT+6
https://www.bloomberg.com/news/articles/2017-04-03/trump-s-pesticide-order-leaves-some-kids-at-higher-risk
Anyone reading about the Trump administration refusal to block agricultural use of a dangerous pesticide may find themselves staring at a bag of oranges, thinking: Will these hurt my family?
Probably not. While consumers trundling through supermarkets across the country worry about their children, those most at risk are a smaller group: mostly Hispanic, their parents are often the undocumented immigrants who live near farms and pick the pesticide-laden produce.
On Wednesday, Scott Pruitt, the new head of the U.S. Environmental Protection Agency, signed an order (PDF) effectively rejecting his agency’s advice to ban chlorpyrifos, a popular (PDF) insecticide, from being used to keep bugs off such crops as walnuts, broccoli, and oranges. Chlorpyrifos is a member of the pesticide class organophosphates. Multiple studies show that eating food grown with the pesticide will in turn expose you to it, with children especially susceptible to its risks. But it’s far worse for those who live and work around the chemical, and worse still if they do both.
A November 2016 report from the EPA’s Office of Chemical Safety and Pollution Prevention found that just by eating such produce, children one to two years of age get a dose that’s 140 times the agency’s safety threshold. While a 2010 study found an association between organophosphate exposure and attention deficit/hyperactivity disorder, it didn’t establish a causal link. The data were also weighted to represent the entire U.S. population of children aged 8 to 15.
A nexus, however, becomes clearer when examining populations closest to where the pesticides are used.
Multiple studies show a connection between prenatal exposure in pregnant women and poorer cognitive function in their offspring. Among these was a 2011 study (PDF) of 329 children of predominantly Mexican-American farmworkers in California’s Salinas Valley, frequently referred to as the world’s “salad bowl.” Researchers found that 7-year-old children born to mothers with the highest levels of prenatal organophosphate exposure had IQs an average of seven points lower than mothers who had lower exposure levels. A 2014 University of California-Davis study found that children of mothers who, during their second trimester, lived within 1.5 kilometers of chlorpyrifos-treated fields were more than three times more likely to develop autism. (Other studies evaluating impacts of organophosphates used as pesticides in the home have reached similar conclusions; notably, the EPA banned chlorpyrifos for most household uses in 2000.)
A 2014 report (PDF) from the California Department of Public Health underscored the racial disparity at play in the pesticide’s deployment. In examining the 15 counties with the most agricultural use, it found that Hispanic children were 46 percent likelier than their white counterparts to attend schools within a quarter-mile of pesticide use. As pesticide intensity increased, so did the disparity: Hispanic children were 91 percent more likely to attend a school near the highest level of pesticide use than were white children.
Even without stepping foot on a field, members of farmworkers’ families are exposed through drift and what sticks to bodies and clothes, said Miriam Rotkin-Ellman, a senior scientist at the Natural Resources Defense Council. The children are often exposed through diet as well—what she called a “double whammy.”
The EPA and CropLife America, the national trade association representing pesticide makers, didn’t respond to requests for comment on any disparate impact of chlorpyrifos use. In a statement March 30, CropLife called a study describing the chemical’s risks “unreliable” while hailing the administration decision as “a hopeful indication that the EPA is recommitting to adherence to established requirements and guidelines relating to transparency, public process, and scientific integrity."
ngel Garcia, a organizer with El Quinto Sol de America, a farmworker advocacy group in California’s Tulare County, warns that the EPA decision will “negatively impact these communities.” Sarah Aird, co-director of the Californians for Pesticide Reform coalition, ascribed political motivation to the Trump administration’s decision, noting the disproportionate impact the pesticide has on rural communities that attract undocumented immigrants in search of work.
“It’s up to California to step up to protect the most disenfranchised among us,” Aird said.
40
Allied Health Science / Woman Killed by a Superbug Resistant to Every Available Antibiotic
« on: January 14, 2017, 05:02:24 PM »
Woman Killed by a Superbug Resistant to Every Available Antibiotic
The “nightmare bacteria” could fend off 26 different drugs
https://www.scientificamerican.com/article/woman-killed-by-a-superbug-resistant-to-every-available-antibiotic/?WT.mc_id=SA_FB_HLTH_NEWS
If it sometimes seems like the idea of antibiotic resistance, though unsettling, is more theoretical than real, please read on.
Public health officials from Nevada are reporting on a case of a woman who died in Reno in September from an incurable infection. Testing showed the superbug that had spread throughout her system could fend off 26 different antibiotics.
“It was tested against everything that’s available in the United States … and was not effective,” said Dr. Alexander Kallen, a medical officer in the Centers for Disease Control and Prevention’s division of health care quality promotion.
Although this isn’t the first time someone in the US has been infected with pan-resistant bacteria, at this point, it is not common. It is, however, alarming.
“I think this is the harbinger of future badness to come,” said Dr. James Johnson, a professor of infectious diseases medicine at the University of Minnesota and a specialist at the Minnesota VA Medical Center.
Other scientists are saying this case is yet another sign that researchers and governments need to take antibiotic resistance seriously. It was reported Thursday in Morbidity and Mortality Weekly Report, a journal published by the CDC.
The authors of the report note this case underscores the need for hospitals to ask incoming patients about foreign travel and also about whether they had recently been hospitalized elsewhere.
The case involved a woman who had spent considerable time in India, where multi-drug-resistant bacteria are more common than they are in the US. She had broken her right femur — the big bone in the thigh — while in India a couple of years back. She later developed a bone infection in her femur and her hip and was hospitalized a number of times in India in the two years that followed. Her last admission to a hospital in India was in June of last year.
The unnamed woman — described as a resident of Washoe County who was in her 70s — went into hospital in Reno for care in mid-August, where it was discovered she was infected with what is called a CRE — carbapenem-resistant enterobacteriaceae. That’s a general name to describe bacteria that commonly live in the gut that have developed resistance to the class of antibiotics called carbapenems — an important last-line of defense used when other antibiotics fail. CDC Director Dr. Tom Frieden has called CREs “nightmare bacteria” because of the danger they pose for spreading antibiotic resistance.
In the woman’s case, the specific bacteria attacking her was called Klebsiella pneumoniae, a bug that often causes of urinary tract infections.
Testing at the hospital showed resistance to 14 drugs — all the drug options the hospital had, said Lei Chen, a senior epidemiologist with Washoe County Health District and an author of the report. “It was my first time to see a [resistance] pattern in our area,” she said.
A sample was sent to the CDC in Atlanta for further testing, which revealed that nothing available to US doctors would have cured this infection. Kallen admitted people in this field experience a sinking feeling when they’re faced with a superbug like this one.
“I think it’s concerning. We have relied for so long on just newer and newer antibiotics. But obviously the bugs can often [develop resistance] faster than we can make new ones,” he said.
Doctors and scientists who track the spread of antibiotic resistance — the rapidly proliferating swarm superbugs — see this case as a big red flag.
“If we’re waiting for some sort of major signal that we need to attack this internationally, we need an aggressive program, both domestically and internationally to attack this problem, here’s one more signal that we need to do that,” said Lance Price, who heads the Antibiotic Resistance Action Center at George Washington University.
There is international recognition of the threat, which an expert report published last year warned could kill 10 million a year by 2050 if left unchecked. In September, the UN General Assembly held a high-level meeting on antibiotic resistance, only the fourth time the body had addressed a health issue.
The woman in Nevada was cared for in isolation; the staff who treated her used infection control precautions to prevent spread of the superbug in the hospital. Chen and Randall Todd, a health department colleague, told STAT testing was done to look for additional infections, but so far none have been detected.
Johnson said it’s likely, though, that other people in the US are carrying similar bacteria in their guts and could become sick at some point. “It’s possible that this is the only person in the US and she had the bad luck to go to India, pick up the bad bug, come back and here it is, we found her and now that she’s dead, it’s gone from the US. That is highly improbable,” he said.
“People have asked me many times ‘How scared should we be?’ … ‘How close are we to the edge of the cliff?’ And I tell them: We’re already falling off the cliff,” Johnson said. “It’s happening. It’s just happening — so far — on a relatively small scale and mostly far away from us. People that we don’t see … so it doesn’t have the same emotional impact.’’
Republished with permission from STAT. This article originally appeared on January 12, 2017
The “nightmare bacteria” could fend off 26 different drugs
https://www.scientificamerican.com/article/woman-killed-by-a-superbug-resistant-to-every-available-antibiotic/?WT.mc_id=SA_FB_HLTH_NEWS
If it sometimes seems like the idea of antibiotic resistance, though unsettling, is more theoretical than real, please read on.
Public health officials from Nevada are reporting on a case of a woman who died in Reno in September from an incurable infection. Testing showed the superbug that had spread throughout her system could fend off 26 different antibiotics.
“It was tested against everything that’s available in the United States … and was not effective,” said Dr. Alexander Kallen, a medical officer in the Centers for Disease Control and Prevention’s division of health care quality promotion.
Although this isn’t the first time someone in the US has been infected with pan-resistant bacteria, at this point, it is not common. It is, however, alarming.
“I think this is the harbinger of future badness to come,” said Dr. James Johnson, a professor of infectious diseases medicine at the University of Minnesota and a specialist at the Minnesota VA Medical Center.
Other scientists are saying this case is yet another sign that researchers and governments need to take antibiotic resistance seriously. It was reported Thursday in Morbidity and Mortality Weekly Report, a journal published by the CDC.
The authors of the report note this case underscores the need for hospitals to ask incoming patients about foreign travel and also about whether they had recently been hospitalized elsewhere.
The case involved a woman who had spent considerable time in India, where multi-drug-resistant bacteria are more common than they are in the US. She had broken her right femur — the big bone in the thigh — while in India a couple of years back. She later developed a bone infection in her femur and her hip and was hospitalized a number of times in India in the two years that followed. Her last admission to a hospital in India was in June of last year.
The unnamed woman — described as a resident of Washoe County who was in her 70s — went into hospital in Reno for care in mid-August, where it was discovered she was infected with what is called a CRE — carbapenem-resistant enterobacteriaceae. That’s a general name to describe bacteria that commonly live in the gut that have developed resistance to the class of antibiotics called carbapenems — an important last-line of defense used when other antibiotics fail. CDC Director Dr. Tom Frieden has called CREs “nightmare bacteria” because of the danger they pose for spreading antibiotic resistance.
In the woman’s case, the specific bacteria attacking her was called Klebsiella pneumoniae, a bug that often causes of urinary tract infections.
Testing at the hospital showed resistance to 14 drugs — all the drug options the hospital had, said Lei Chen, a senior epidemiologist with Washoe County Health District and an author of the report. “It was my first time to see a [resistance] pattern in our area,” she said.
A sample was sent to the CDC in Atlanta for further testing, which revealed that nothing available to US doctors would have cured this infection. Kallen admitted people in this field experience a sinking feeling when they’re faced with a superbug like this one.
“I think it’s concerning. We have relied for so long on just newer and newer antibiotics. But obviously the bugs can often [develop resistance] faster than we can make new ones,” he said.
Doctors and scientists who track the spread of antibiotic resistance — the rapidly proliferating swarm superbugs — see this case as a big red flag.
“If we’re waiting for some sort of major signal that we need to attack this internationally, we need an aggressive program, both domestically and internationally to attack this problem, here’s one more signal that we need to do that,” said Lance Price, who heads the Antibiotic Resistance Action Center at George Washington University.
There is international recognition of the threat, which an expert report published last year warned could kill 10 million a year by 2050 if left unchecked. In September, the UN General Assembly held a high-level meeting on antibiotic resistance, only the fourth time the body had addressed a health issue.
The woman in Nevada was cared for in isolation; the staff who treated her used infection control precautions to prevent spread of the superbug in the hospital. Chen and Randall Todd, a health department colleague, told STAT testing was done to look for additional infections, but so far none have been detected.
Johnson said it’s likely, though, that other people in the US are carrying similar bacteria in their guts and could become sick at some point. “It’s possible that this is the only person in the US and she had the bad luck to go to India, pick up the bad bug, come back and here it is, we found her and now that she’s dead, it’s gone from the US. That is highly improbable,” he said.
“People have asked me many times ‘How scared should we be?’ … ‘How close are we to the edge of the cliff?’ And I tell them: We’re already falling off the cliff,” Johnson said. “It’s happening. It’s just happening — so far — on a relatively small scale and mostly far away from us. People that we don’t see … so it doesn’t have the same emotional impact.’’
Republished with permission from STAT. This article originally appeared on January 12, 2017
41
Teaching & Research Forum / Why doing a PhD is often a waste of time
« on: December 29, 2016, 12:18:30 PM »
Why doing a PhD is often a waste of time
https://medium.com/the-economist/why-doing-a-phd-is-often-a-waste-of-time-349206f9addb#.pawqz3ynx
On the evening before All Saints’ Day in 1517, Martin Luther nailed 95 theses to the door of a church in Wittenberg. In those days a thesis was simply a position one wanted to argue. Luther, an Augustinian friar, asserted that Christians could not buy their way to heaven. Today a doctoral thesis is both an idea and an account of a period of original research. Writing one is the aim of the hundreds of thousands of students who embark on a doctorate of philosophy (PhD) every year.
In most countries a PhD is a basic requirement for a career in academia. It is an introduction to the world of independent research — a kind of intellectual masterpiece, created by an apprentice in close collaboration with a supervisor. The requirements to complete one vary enormously between countries, universities and even subjects. Some students will first have to spend two years working on a master’s degree or diploma. Some will receive a stipend; others will pay their own way. Some PhDs involve only research, some require classes and examinations and some require the student to teach undergraduates. A thesis can be dozens of pages in mathematics, or many hundreds in history. As a result, newly minted PhDs can be as young as their early 20s or world-weary forty-somethings.
One thing many PhD students have in common is dissatisfaction. Some describe their work as “slave labour”. Seven-day weeks, ten-hour days, low pay and uncertain prospects are widespread. You know you are a graduate student, goes one quip, when your office is better decorated than your home and you have a favourite flavour of instant noodle. “It isn’t graduate school itself that is discouraging,” says one student, who confesses to rather enjoying the hunt for free pizza. “What’s discouraging is realising the end point has been yanked out of reach.”
Whining PhD students are nothing new, but there seem to be genuine problems with the system that produces research doctorates (the practical “professional doctorates” in fields such as law, business and medicine have a more obvious value). There is an oversupply of PhDs. Although a doctorate is designed as training for a job in academia, the number of PhD positions is unrelated to the number of job openings. Meanwhile, business leaders complain about shortages of high-level skills, suggesting PhDs are not teaching the right things. The fiercest critics compare research doctorates to Ponzi or pyramid schemes.
Rich pickings
For most of history even a first degree at a university was the privilege of a rich few, and many academic staff did not hold doctorates. But as higher education expanded after the second world war, so did the expectation that lecturers would hold advanced degrees. American universities geared up first: by 1970 America was producing just under a third of the world’s university students and half of its science and technology PhDs (at that time it had only 6% of the global population). Since then America’s annual output of PhDs has doubled, to 64,000.
Other countries are catching up. Between 1998 and 2006 the number of doctorates handed out in all OECD countries grew by 40%, compared with 22% for America. PhD production sped up most dramatically in Mexico, Portugal, Italy and Slovakia. Even Japan, where the number of young people is shrinking, churned out about 46% more PhDs. Part of that growth reflects the expansion of university education outside America. Richard Freeman, a labour economist at Harvard University, says that by 2006 America was enrolling just 12% of the world’s students.
But universities have discovered that PhD students are cheap, highly motivated and disposable labour. With more PhD students they can do more research, and in some countries more teaching, with less money. A graduate assistant at Yale might earn $20,000 a year for nine months of teaching. The average pay of full professors in America was $109,000 in 2009 — higher than the average for judges and magistrates.
Indeed, the production of PhDs has far outstripped demand for university lecturers. In a recent book, Andrew Hacker and Claudia Dreifus, an academic and a journalist, report that America produced more than 100,000 doctoral degrees between 2005 and 2009. In the same period there were just 16,000 new professorships. Using PhD students to do much of the undergraduate teaching cuts the number of full-time jobs. Even in Canada, where the output of PhD graduates has grown relatively modestly, universities conferred 4,800 doctorate degrees in 2007 but hired just 2,616 new full-time professors. Only a few fast-developing countries, such as Brazil and China, now seem short of PhDs.
A short course in supply and demand
In research the story is similar. PhD students and contract staff known as “postdocs”, described by one student as “the ugly underbelly of academia”, do much of the research these days. There is a glut of postdocs too. Dr Freeman concluded from pre-2000 data that if American faculty jobs in the life sciences were increasing at 5% a year, just 20% of students would land one. In Canada 80% of postdocs earn $38,600 or less per year before tax — the average salary of a construction worker. The rise of the postdoc has created another obstacle on the way to an academic post. In some areas five years as a postdoc is now a prerequisite for landing a secure full-time job.
These armies of low-paid PhD researchers and postdocs boost universities’, and therefore countries’, research capacity. Yet that is not always a good thing. Brilliant, well-trained minds can go to waste when fashions change. The post-Sputnik era drove the rapid growth in PhD physicists that came to an abrupt halt as the Vietnam war drained the science budget. Brian Schwartz, a professor of physics at the City University of New York, says that in the 1970s as many as 5,000 physicists had to find jobs in other areas.
In America the rise of PhD teachers’ unions reflects the breakdown of an implicit contract between universities and PhD students: crummy pay now for a good academic job later. Student teachers in public universities such as the University of Wisconsin-Madison formed unions as early as the 1960s, but the pace of unionisation has increased recently. Unions are now spreading to private universities; though Yale and Cornell, where university administrators and some faculty argue that PhD students who teach are not workers but apprentices, have resisted union drives. In 2002 New York University was the first private university to recognise a PhD teachers’ union, but stopped negotiating with it three years later.
In some countries, such as Britain and America, poor pay and job prospects are reflected in the number of foreign-born PhD students. Dr Freeman estimates that in 1966 only 23% of science and engineering PhDs in America were awarded to students born outside the country. By 2006 that proportion had increased to 48%. Foreign students tend to tolerate poorer working conditions, and the supply of cheap, brilliant, foreign labour also keeps wages down.
A PhD may offer no financial benefit over a master’s degree. It can even reduce earnings
Proponents of the PhD argue that it is worthwhile even if it does not lead to permanent academic employment. Not every student embarks on a PhD wanting a university career and many move successfully into private-sector jobs in, for instance, industrial research. That is true; but drop-out rates suggest that many students become dispirited. In America only 57% of doctoral students will have a PhD ten years after their first date of enrolment. In the humanities, where most students pay for their own PhDs, the figure is 49%. Worse still, whereas in other subject areas students tend to jump ship in the early years, in the humanities they cling like limpets before eventually falling off. And these students started out as the academic cream of the nation. Research at one American university found that those who finish are no cleverer than those who do not. Poor supervision, bad job prospects or lack of money cause them to run out of steam.
Even graduates who find work outside universities may not fare all that well. PhD courses are so specialised that university careers offices struggle to assist graduates looking for jobs, and supervisors tend to have little interest in students who are leaving academia. One OECD study shows that five years after receiving their degrees, more than 60% of PhDs in Slovakia and more than 45% in Belgium, the Czech Republic, Germany and Spain were still on temporary contracts. Many were postdocs. About one-third of Austria’s PhD graduates take jobs unrelated to their degrees. In Germany 13% of all PhD graduates end up in lowly occupations. In the Netherlands the proportion is 21%.
A very slim premium
PhD graduates do at least earn more than those with a bachelor’s degree. A study in the Journal of Higher Education Policy and Management by Bernard Casey shows that British men with a bachelor’s degree earn 14% more than those who could have gone to university but chose not to. The earnings premium for a PhD is 26%. But the premium for a master’s degree, which can be accomplished in as little as one year, is almost as high, at 23%. In some subjects the premium for a PhD vanishes entirely. PhDs in maths and computing, social sciences and languages earn no more than those with master’s degrees. The premium for a PhD is actually smaller than for a master’s degree in engineering and technology, architecture and education. Only in medicine, other sciences, and business and financial studies is it high enough to be worthwhile. Over all subjects, a PhD commands only a 3% premium over a master’s degree.
Dr Schwartz, the New York physicist, says the skills learned in the course of a PhD can be readily acquired through much shorter courses. Thirty years ago, he says, Wall Street firms realised that some physicists could work out differential equations and recruited them to become “quants”, analysts and traders. Today several short courses offer the advanced maths useful for finance. “A PhD physicist with one course on differential equations is not competitive,” says Dr Schwartz.
Many students say they are pursuing their subject out of love, and that education is an end in itself. Some give little thought to where the qualification might lead. In one study of British PhD graduates, about a third admitted that they were doing their doctorate partly to go on being a student, or put off job hunting. Nearly half of engineering students admitted to this. Scientists can easily get stipends, and therefore drift into doing a PhD. But there are penalties, as well as benefits, to staying at university. Workers with “surplus schooling” — more education than a job requires — are likely to be less satisfied, less productive and more likely to say they are going to leave their jobs.
Academics tend to regard asking whether a PhD is worthwhile as analogous to wondering whether there is too much art or culture in the world. They believe that knowledge spills from universities into society, making it more productive and healthier. That may well be true; but doing a PhD may still be a bad choice for an individual.
The interests of academics and universities on the one hand and PhD students on the other are not well aligned. The more bright students stay at universities, the better it is for academics. Postgraduate students bring in grants and beef up their supervisors’ publication records. Academics pick bright undergraduate students and groom them as potential graduate students. It isn’t in their interests to turn the smart kids away, at least at the beginning. One female student spoke of being told of glowing opportunities at the outset, but after seven years of hard slog she was fobbed off with a joke about finding a rich husband.
Monica Harris, a professor of psychology at the University of Kentucky, is a rare exception. She believes that too many PhDs are being produced, and has stopped admitting them. But such unilateral academic birth control is rare. One Ivy-League president, asked recently about PhD oversupply, said that if the top universities cut back others will step in to offer them instead.
Noble pursuits
Many of the drawbacks of doing a PhD are well known. Your correspondent was aware of them over a decade ago while she slogged through a largely pointless PhD in theoretical ecology. As Europeans try to harmonise higher education, some institutions are pushing the more structured learning that comes with an American PhD.
The organisations that pay for research have realised that many PhDs find it tough to transfer their skills into the job market. Writing lab reports, giving academic presentations and conducting six-month literature reviews can be surprisingly unhelpful in a world where technical knowledge has to be assimilated quickly and presented simply to a wide audience. Some universities are now offering their PhD students training in soft skills such as communication and teamwork that may be useful in the labour market. In Britain a four-year NewRoutePhD claims to develop just such skills in graduates.
The interests of universities and tenured academics are misaligned with those of PhD students
Measurements and incentives might be changed, too. Some university departments and academics regard numbers of PhD graduates as an indicator of success and compete to produce more. For the students, a measure of how quickly those students get a permanent job, and what they earn, would be more useful. Where penalties are levied on academics who allow PhDs to overrun, the number of students who complete rises abruptly, suggesting that students were previously allowed to fester.
Many of those who embark on a PhD are the smartest in their class and will have been the best at everything they have done. They will have amassed awards and prizes. As this year’s new crop of graduate students bounce into their research, few will be willing to accept that the system they are entering could be designed for the benefit of others, that even hard work and brilliance may well not be enough to succeed, and that they would be better off doing something else. They might use their research skills to look harder at the lot of the disposable academic. Someone should write a thesis about that.
This article originally appeared in the 2010 Christmas double issue of The Economist.
https://medium.com/the-economist/why-doing-a-phd-is-often-a-waste-of-time-349206f9addb#.pawqz3ynx
On the evening before All Saints’ Day in 1517, Martin Luther nailed 95 theses to the door of a church in Wittenberg. In those days a thesis was simply a position one wanted to argue. Luther, an Augustinian friar, asserted that Christians could not buy their way to heaven. Today a doctoral thesis is both an idea and an account of a period of original research. Writing one is the aim of the hundreds of thousands of students who embark on a doctorate of philosophy (PhD) every year.
In most countries a PhD is a basic requirement for a career in academia. It is an introduction to the world of independent research — a kind of intellectual masterpiece, created by an apprentice in close collaboration with a supervisor. The requirements to complete one vary enormously between countries, universities and even subjects. Some students will first have to spend two years working on a master’s degree or diploma. Some will receive a stipend; others will pay their own way. Some PhDs involve only research, some require classes and examinations and some require the student to teach undergraduates. A thesis can be dozens of pages in mathematics, or many hundreds in history. As a result, newly minted PhDs can be as young as their early 20s or world-weary forty-somethings.
One thing many PhD students have in common is dissatisfaction. Some describe their work as “slave labour”. Seven-day weeks, ten-hour days, low pay and uncertain prospects are widespread. You know you are a graduate student, goes one quip, when your office is better decorated than your home and you have a favourite flavour of instant noodle. “It isn’t graduate school itself that is discouraging,” says one student, who confesses to rather enjoying the hunt for free pizza. “What’s discouraging is realising the end point has been yanked out of reach.”
Whining PhD students are nothing new, but there seem to be genuine problems with the system that produces research doctorates (the practical “professional doctorates” in fields such as law, business and medicine have a more obvious value). There is an oversupply of PhDs. Although a doctorate is designed as training for a job in academia, the number of PhD positions is unrelated to the number of job openings. Meanwhile, business leaders complain about shortages of high-level skills, suggesting PhDs are not teaching the right things. The fiercest critics compare research doctorates to Ponzi or pyramid schemes.
Rich pickings
For most of history even a first degree at a university was the privilege of a rich few, and many academic staff did not hold doctorates. But as higher education expanded after the second world war, so did the expectation that lecturers would hold advanced degrees. American universities geared up first: by 1970 America was producing just under a third of the world’s university students and half of its science and technology PhDs (at that time it had only 6% of the global population). Since then America’s annual output of PhDs has doubled, to 64,000.
Other countries are catching up. Between 1998 and 2006 the number of doctorates handed out in all OECD countries grew by 40%, compared with 22% for America. PhD production sped up most dramatically in Mexico, Portugal, Italy and Slovakia. Even Japan, where the number of young people is shrinking, churned out about 46% more PhDs. Part of that growth reflects the expansion of university education outside America. Richard Freeman, a labour economist at Harvard University, says that by 2006 America was enrolling just 12% of the world’s students.
But universities have discovered that PhD students are cheap, highly motivated and disposable labour. With more PhD students they can do more research, and in some countries more teaching, with less money. A graduate assistant at Yale might earn $20,000 a year for nine months of teaching. The average pay of full professors in America was $109,000 in 2009 — higher than the average for judges and magistrates.
Indeed, the production of PhDs has far outstripped demand for university lecturers. In a recent book, Andrew Hacker and Claudia Dreifus, an academic and a journalist, report that America produced more than 100,000 doctoral degrees between 2005 and 2009. In the same period there were just 16,000 new professorships. Using PhD students to do much of the undergraduate teaching cuts the number of full-time jobs. Even in Canada, where the output of PhD graduates has grown relatively modestly, universities conferred 4,800 doctorate degrees in 2007 but hired just 2,616 new full-time professors. Only a few fast-developing countries, such as Brazil and China, now seem short of PhDs.
A short course in supply and demand
In research the story is similar. PhD students and contract staff known as “postdocs”, described by one student as “the ugly underbelly of academia”, do much of the research these days. There is a glut of postdocs too. Dr Freeman concluded from pre-2000 data that if American faculty jobs in the life sciences were increasing at 5% a year, just 20% of students would land one. In Canada 80% of postdocs earn $38,600 or less per year before tax — the average salary of a construction worker. The rise of the postdoc has created another obstacle on the way to an academic post. In some areas five years as a postdoc is now a prerequisite for landing a secure full-time job.
These armies of low-paid PhD researchers and postdocs boost universities’, and therefore countries’, research capacity. Yet that is not always a good thing. Brilliant, well-trained minds can go to waste when fashions change. The post-Sputnik era drove the rapid growth in PhD physicists that came to an abrupt halt as the Vietnam war drained the science budget. Brian Schwartz, a professor of physics at the City University of New York, says that in the 1970s as many as 5,000 physicists had to find jobs in other areas.
In America the rise of PhD teachers’ unions reflects the breakdown of an implicit contract between universities and PhD students: crummy pay now for a good academic job later. Student teachers in public universities such as the University of Wisconsin-Madison formed unions as early as the 1960s, but the pace of unionisation has increased recently. Unions are now spreading to private universities; though Yale and Cornell, where university administrators and some faculty argue that PhD students who teach are not workers but apprentices, have resisted union drives. In 2002 New York University was the first private university to recognise a PhD teachers’ union, but stopped negotiating with it three years later.
In some countries, such as Britain and America, poor pay and job prospects are reflected in the number of foreign-born PhD students. Dr Freeman estimates that in 1966 only 23% of science and engineering PhDs in America were awarded to students born outside the country. By 2006 that proportion had increased to 48%. Foreign students tend to tolerate poorer working conditions, and the supply of cheap, brilliant, foreign labour also keeps wages down.
A PhD may offer no financial benefit over a master’s degree. It can even reduce earnings
Proponents of the PhD argue that it is worthwhile even if it does not lead to permanent academic employment. Not every student embarks on a PhD wanting a university career and many move successfully into private-sector jobs in, for instance, industrial research. That is true; but drop-out rates suggest that many students become dispirited. In America only 57% of doctoral students will have a PhD ten years after their first date of enrolment. In the humanities, where most students pay for their own PhDs, the figure is 49%. Worse still, whereas in other subject areas students tend to jump ship in the early years, in the humanities they cling like limpets before eventually falling off. And these students started out as the academic cream of the nation. Research at one American university found that those who finish are no cleverer than those who do not. Poor supervision, bad job prospects or lack of money cause them to run out of steam.
Even graduates who find work outside universities may not fare all that well. PhD courses are so specialised that university careers offices struggle to assist graduates looking for jobs, and supervisors tend to have little interest in students who are leaving academia. One OECD study shows that five years after receiving their degrees, more than 60% of PhDs in Slovakia and more than 45% in Belgium, the Czech Republic, Germany and Spain were still on temporary contracts. Many were postdocs. About one-third of Austria’s PhD graduates take jobs unrelated to their degrees. In Germany 13% of all PhD graduates end up in lowly occupations. In the Netherlands the proportion is 21%.
A very slim premium
PhD graduates do at least earn more than those with a bachelor’s degree. A study in the Journal of Higher Education Policy and Management by Bernard Casey shows that British men with a bachelor’s degree earn 14% more than those who could have gone to university but chose not to. The earnings premium for a PhD is 26%. But the premium for a master’s degree, which can be accomplished in as little as one year, is almost as high, at 23%. In some subjects the premium for a PhD vanishes entirely. PhDs in maths and computing, social sciences and languages earn no more than those with master’s degrees. The premium for a PhD is actually smaller than for a master’s degree in engineering and technology, architecture and education. Only in medicine, other sciences, and business and financial studies is it high enough to be worthwhile. Over all subjects, a PhD commands only a 3% premium over a master’s degree.
Dr Schwartz, the New York physicist, says the skills learned in the course of a PhD can be readily acquired through much shorter courses. Thirty years ago, he says, Wall Street firms realised that some physicists could work out differential equations and recruited them to become “quants”, analysts and traders. Today several short courses offer the advanced maths useful for finance. “A PhD physicist with one course on differential equations is not competitive,” says Dr Schwartz.
Many students say they are pursuing their subject out of love, and that education is an end in itself. Some give little thought to where the qualification might lead. In one study of British PhD graduates, about a third admitted that they were doing their doctorate partly to go on being a student, or put off job hunting. Nearly half of engineering students admitted to this. Scientists can easily get stipends, and therefore drift into doing a PhD. But there are penalties, as well as benefits, to staying at university. Workers with “surplus schooling” — more education than a job requires — are likely to be less satisfied, less productive and more likely to say they are going to leave their jobs.
Academics tend to regard asking whether a PhD is worthwhile as analogous to wondering whether there is too much art or culture in the world. They believe that knowledge spills from universities into society, making it more productive and healthier. That may well be true; but doing a PhD may still be a bad choice for an individual.
The interests of academics and universities on the one hand and PhD students on the other are not well aligned. The more bright students stay at universities, the better it is for academics. Postgraduate students bring in grants and beef up their supervisors’ publication records. Academics pick bright undergraduate students and groom them as potential graduate students. It isn’t in their interests to turn the smart kids away, at least at the beginning. One female student spoke of being told of glowing opportunities at the outset, but after seven years of hard slog she was fobbed off with a joke about finding a rich husband.
Monica Harris, a professor of psychology at the University of Kentucky, is a rare exception. She believes that too many PhDs are being produced, and has stopped admitting them. But such unilateral academic birth control is rare. One Ivy-League president, asked recently about PhD oversupply, said that if the top universities cut back others will step in to offer them instead.
Noble pursuits
Many of the drawbacks of doing a PhD are well known. Your correspondent was aware of them over a decade ago while she slogged through a largely pointless PhD in theoretical ecology. As Europeans try to harmonise higher education, some institutions are pushing the more structured learning that comes with an American PhD.
The organisations that pay for research have realised that many PhDs find it tough to transfer their skills into the job market. Writing lab reports, giving academic presentations and conducting six-month literature reviews can be surprisingly unhelpful in a world where technical knowledge has to be assimilated quickly and presented simply to a wide audience. Some universities are now offering their PhD students training in soft skills such as communication and teamwork that may be useful in the labour market. In Britain a four-year NewRoutePhD claims to develop just such skills in graduates.
The interests of universities and tenured academics are misaligned with those of PhD students
Measurements and incentives might be changed, too. Some university departments and academics regard numbers of PhD graduates as an indicator of success and compete to produce more. For the students, a measure of how quickly those students get a permanent job, and what they earn, would be more useful. Where penalties are levied on academics who allow PhDs to overrun, the number of students who complete rises abruptly, suggesting that students were previously allowed to fester.
Many of those who embark on a PhD are the smartest in their class and will have been the best at everything they have done. They will have amassed awards and prizes. As this year’s new crop of graduate students bounce into their research, few will be willing to accept that the system they are entering could be designed for the benefit of others, that even hard work and brilliance may well not be enough to succeed, and that they would be better off doing something else. They might use their research skills to look harder at the lot of the disposable academic. Someone should write a thesis about that.
This article originally appeared in the 2010 Christmas double issue of The Economist.
42
Teaching & Research Forum / প্রভাষক হতে ৩-২০ লাখ টাকা লেনদেন: টিআইবি
« on: December 18, 2016, 10:40:29 PM »
প্রভাষক হতে ৩-২০ লাখ টাকা লেনদেন: টিআইবি
http://www.prothom-alo.com/bangladesh/article/1042077/%E0%A6%AA%E0%A7%8D%E0%A6%B0%E0%A6%AD%E0%A6%BE%E0%A6%B7%E0%A6%95-%E0%A6%B9%E0%A6%A4%E0%A7%87-%E0%A7%A9-%E0%A7%A8%E0%A7%A6-%E0%A6%B2%E0%A6%BE%E0%A6%96-%E0%A6%9F%E0%A6%BE%E0%A6%95%E0%A6%BE-%E0%A6%B2%E0%A7%87%E0%A6%A8%E0%A6%A6%E0%A7%87%E0%A6%A8-%E0%A6%9F%E0%A6%BF%E0%A6%86%E0%A6%87%E0%A6%AC%E0%A6%BF
দেশের পাবলিক বিশ্ববিদ্যালয়গুলোতে প্রভাষক নিয়োগে পদে পদে অনিয়ম ও দুর্নীতির চিত্র তুলে ধরল দুর্নীতিবিরোধী সংস্থা ট্রান্সপারেন্সি ইন্টারন্যাশনাল বাংলাদেশ (টিআইবি)। সংস্থাটি বলেছে, ১৩টি বিশ্ববিদ্যালয়ে গবেষণা করে দেখা গেছে যে আটটি বিশ্ববিদ্যালয়েই প্রভাষক নিয়োগে আর্থিক লেনদেনের অভিযোগ উঠেছে। এ পদে নিয়োগে ৩ লাখ থেকে সর্বোচ্চ ২০ লাখ টাকা পর্যন্ত লেনদেন হয়েছে।
আজ রোববার দুপুরে রাজধানীর ধানমন্ডিতে টিআইবি কার্যালয়ে আয়োজিত সংবাদ সম্মেলনে এসব অনিয়মের চিত্র তুলে ধরা হয়। ‘সরকারি বিশ্ববিদ্যালয়ে প্রভাষক নিয়োগ: সুশাসনের চ্যালেঞ্জ ও উত্তরণের উপায়’ শীর্ষক এই গবেষণা প্রতিবেদনের বিভিন্ন তথ্য তুলে ধরেন টিআইবির দুই গবেষক দিপু রায় ও রেযাউল করিম।
২০০১ সাল থেকে ২০১৬ সালের ঘটনা নিয়ে গবেষণাটি করা হয়েছে। তবে গবেষণাটি করা হয়েছে এ বছরের জানুয়ারি থেকে ডিসেম্বর পর্যন্ত। দেশের ৩৭টি পাবলিক বিশ্ববিদ্যালয়ের মধ্যে ১৩টি বিশ্ববিদ্যালয় নিয়ে গবেষণাটি পরিচালিত হয়।
গবেষণা প্রতিবেদনে বলা হয়, নিয়োগের আগে থেকেই বিভিন্ন ধরনের অনিয়ম শুরু হয়। নিয়োগ বোর্ড গঠন, সুবিধামতো যোগ্যতা পরিবর্তন বা শিথিল করা, জবাবদিহি না থাকার মাধ্যমে এই অনিয়মের শুরুটা হয়। গবেষণায় দেখা গেছে, ১৩টি বিশ্ববিদ্যালয়ের মধ্যে ১২টি বিশ্ববিদ্যালয়ে নিয়োগ বোর্ড গঠনে ক্ষমতাসীন রাজনৈতিক দলের মতাদর্শের সুযোগ বিদ্যমান ছিল।
নিয়োগের আগেই আরও যেভাবে অনিয়ম শুরু হয়, তারও কিছু চিত্র তুলে ধরা হয় এই প্রতিবেদনে। এতে বলা হয়, কোনো কোনো শিক্ষক পছন্দের শিক্ষার্থীদের একাডেমিক পরীক্ষার ফল প্রভাবিত করেন এবং পরবর্তী সময়ে তাঁদের নিয়োগ দেওয়া হয়। এ ছাড়া বাজার করাসহ ব্যক্তিগত কাজে ব্যবহার করে আগে থেকেই একাডেমিক পরীক্ষার সম্ভাব্য প্রশ্ন সম্পর্কে ধারণা দেওয়া হয়। ক্ষেত্রবিশেষে নারী শিক্ষার্থীর একাংশের সঙ্গে বিশেষ সম্পর্ক স্থাপনের মাধ্যমে একাডেমিক পরীক্ষায় নম্বর বাড়িয়ে দেওয়া, পরীক্ষার পূর্বে প্রশ্ন জানানো ও পরবর্তী সময়ে শিক্ষক হিসেবে নিয়োগ দেওয়া হয়। এসব অনিয়মের কারণে নিয়োগ প্রক্রিয়ায় ‘নোট অব ডিসেন্ট’-এর সুযোগ থাকলেও সেটিকে গুরুত্ব না দিয়ে সিন্ডিকেট নিয়োগ চূড়ান্ত করে।
১৩টি বিশ্ববিদ্যালয়ের মধ্যে ১২টিতেই কোনো না কোনো নিয়োগের ক্ষেত্রে ‘নোট অব ডিসেন্ট’কে কার্যকর পদক্ষেপ হিসেবে দেখা যায়নি। এ ছাড়া ১১টি বিশ্ববিদ্যালয়ে নিয়মবহির্ভূতভাবে বিজ্ঞপ্তির চেয়েও বেশি শিক্ষক নিয়োগ করা হয়। রাজনৈতিক মতাদর্শ ও দল ভারী করা এসব অনিয়মের একটি বড় প্রভাবক।
প্রতিবেদনে বেশ কিছু সুপারিশও তুলে ধরা হয়। সংবাদ সম্মেলনে টিআইবির নির্বাহী পরিচালক ইফতেখারুজ্জামান বলেন, সার্বিক চিত্রটি হতাশাব্যঞ্জক ও উদ্বেগজনক। তিনি প্রভাষক নিয়োগে সমন্বিত ও পূর্ণাঙ্গ নিয়োগ বিধিমালা করার দাবি জানান।
অনুষ্ঠানে শিক্ষাবিদ ও টিআইবির ট্রাস্টি বোর্ডের সদস্য সৈয়দ মনজুরুল ইসলাম বলেন, ‘আমার অভিজ্ঞতা বলছে, যে চিত্র তুলে ধরা হয়েছে, তা বাস্তব। কত শতাংশ অনিয়ম-দুর্নীতি হলো, সেটা বিচার করছি না। কারণ, নিম্ন মেধার একজন শিক্ষক নিয়োগ হলে প্রায় ৪০ বছর ওই বিশ্ববিদ্যালয়কে শ্রেষ্ঠ শিক্ষা দেওয়া থেকে বঞ্চিত করবেন। তাই এ ধরনের একটি ঘটনা হলেও তা মানতে চাই না। এটি অশনিসংকেত।’
http://www.prothom-alo.com/bangladesh/article/1042077/%E0%A6%AA%E0%A7%8D%E0%A6%B0%E0%A6%AD%E0%A6%BE%E0%A6%B7%E0%A6%95-%E0%A6%B9%E0%A6%A4%E0%A7%87-%E0%A7%A9-%E0%A7%A8%E0%A7%A6-%E0%A6%B2%E0%A6%BE%E0%A6%96-%E0%A6%9F%E0%A6%BE%E0%A6%95%E0%A6%BE-%E0%A6%B2%E0%A7%87%E0%A6%A8%E0%A6%A6%E0%A7%87%E0%A6%A8-%E0%A6%9F%E0%A6%BF%E0%A6%86%E0%A6%87%E0%A6%AC%E0%A6%BF
দেশের পাবলিক বিশ্ববিদ্যালয়গুলোতে প্রভাষক নিয়োগে পদে পদে অনিয়ম ও দুর্নীতির চিত্র তুলে ধরল দুর্নীতিবিরোধী সংস্থা ট্রান্সপারেন্সি ইন্টারন্যাশনাল বাংলাদেশ (টিআইবি)। সংস্থাটি বলেছে, ১৩টি বিশ্ববিদ্যালয়ে গবেষণা করে দেখা গেছে যে আটটি বিশ্ববিদ্যালয়েই প্রভাষক নিয়োগে আর্থিক লেনদেনের অভিযোগ উঠেছে। এ পদে নিয়োগে ৩ লাখ থেকে সর্বোচ্চ ২০ লাখ টাকা পর্যন্ত লেনদেন হয়েছে।
আজ রোববার দুপুরে রাজধানীর ধানমন্ডিতে টিআইবি কার্যালয়ে আয়োজিত সংবাদ সম্মেলনে এসব অনিয়মের চিত্র তুলে ধরা হয়। ‘সরকারি বিশ্ববিদ্যালয়ে প্রভাষক নিয়োগ: সুশাসনের চ্যালেঞ্জ ও উত্তরণের উপায়’ শীর্ষক এই গবেষণা প্রতিবেদনের বিভিন্ন তথ্য তুলে ধরেন টিআইবির দুই গবেষক দিপু রায় ও রেযাউল করিম।
২০০১ সাল থেকে ২০১৬ সালের ঘটনা নিয়ে গবেষণাটি করা হয়েছে। তবে গবেষণাটি করা হয়েছে এ বছরের জানুয়ারি থেকে ডিসেম্বর পর্যন্ত। দেশের ৩৭টি পাবলিক বিশ্ববিদ্যালয়ের মধ্যে ১৩টি বিশ্ববিদ্যালয় নিয়ে গবেষণাটি পরিচালিত হয়।
গবেষণা প্রতিবেদনে বলা হয়, নিয়োগের আগে থেকেই বিভিন্ন ধরনের অনিয়ম শুরু হয়। নিয়োগ বোর্ড গঠন, সুবিধামতো যোগ্যতা পরিবর্তন বা শিথিল করা, জবাবদিহি না থাকার মাধ্যমে এই অনিয়মের শুরুটা হয়। গবেষণায় দেখা গেছে, ১৩টি বিশ্ববিদ্যালয়ের মধ্যে ১২টি বিশ্ববিদ্যালয়ে নিয়োগ বোর্ড গঠনে ক্ষমতাসীন রাজনৈতিক দলের মতাদর্শের সুযোগ বিদ্যমান ছিল।
নিয়োগের আগেই আরও যেভাবে অনিয়ম শুরু হয়, তারও কিছু চিত্র তুলে ধরা হয় এই প্রতিবেদনে। এতে বলা হয়, কোনো কোনো শিক্ষক পছন্দের শিক্ষার্থীদের একাডেমিক পরীক্ষার ফল প্রভাবিত করেন এবং পরবর্তী সময়ে তাঁদের নিয়োগ দেওয়া হয়। এ ছাড়া বাজার করাসহ ব্যক্তিগত কাজে ব্যবহার করে আগে থেকেই একাডেমিক পরীক্ষার সম্ভাব্য প্রশ্ন সম্পর্কে ধারণা দেওয়া হয়। ক্ষেত্রবিশেষে নারী শিক্ষার্থীর একাংশের সঙ্গে বিশেষ সম্পর্ক স্থাপনের মাধ্যমে একাডেমিক পরীক্ষায় নম্বর বাড়িয়ে দেওয়া, পরীক্ষার পূর্বে প্রশ্ন জানানো ও পরবর্তী সময়ে শিক্ষক হিসেবে নিয়োগ দেওয়া হয়। এসব অনিয়মের কারণে নিয়োগ প্রক্রিয়ায় ‘নোট অব ডিসেন্ট’-এর সুযোগ থাকলেও সেটিকে গুরুত্ব না দিয়ে সিন্ডিকেট নিয়োগ চূড়ান্ত করে।
১৩টি বিশ্ববিদ্যালয়ের মধ্যে ১২টিতেই কোনো না কোনো নিয়োগের ক্ষেত্রে ‘নোট অব ডিসেন্ট’কে কার্যকর পদক্ষেপ হিসেবে দেখা যায়নি। এ ছাড়া ১১টি বিশ্ববিদ্যালয়ে নিয়মবহির্ভূতভাবে বিজ্ঞপ্তির চেয়েও বেশি শিক্ষক নিয়োগ করা হয়। রাজনৈতিক মতাদর্শ ও দল ভারী করা এসব অনিয়মের একটি বড় প্রভাবক।
প্রতিবেদনে বেশ কিছু সুপারিশও তুলে ধরা হয়। সংবাদ সম্মেলনে টিআইবির নির্বাহী পরিচালক ইফতেখারুজ্জামান বলেন, সার্বিক চিত্রটি হতাশাব্যঞ্জক ও উদ্বেগজনক। তিনি প্রভাষক নিয়োগে সমন্বিত ও পূর্ণাঙ্গ নিয়োগ বিধিমালা করার দাবি জানান।
অনুষ্ঠানে শিক্ষাবিদ ও টিআইবির ট্রাস্টি বোর্ডের সদস্য সৈয়দ মনজুরুল ইসলাম বলেন, ‘আমার অভিজ্ঞতা বলছে, যে চিত্র তুলে ধরা হয়েছে, তা বাস্তব। কত শতাংশ অনিয়ম-দুর্নীতি হলো, সেটা বিচার করছি না। কারণ, নিম্ন মেধার একজন শিক্ষক নিয়োগ হলে প্রায় ৪০ বছর ওই বিশ্ববিদ্যালয়কে শ্রেষ্ঠ শিক্ষা দেওয়া থেকে বঞ্চিত করবেন। তাই এ ধরনের একটি ঘটনা হলেও তা মানতে চাই না। এটি অশনিসংকেত।’
43
Allied Health Science / Healthy baby born to woman who had her ovary frozen aged nine
« on: December 15, 2016, 09:50:54 PM »
Healthy baby born to woman who had her ovary frozen aged nine
Moaza Al Matrooshi, 24, went into menopause after chemotherapy but had her fertility restored using thawed tissue
https://www.theguardian.com/science/2016/dec/14/healthy-baby-born-to-woman-who-had-her-ovary-frozen-aged-nine?CMP=fb_gu
A woman has given birth to a healthy baby boy after doctors restored her fertility with ovarian tissue she had had frozen as a child.
Moaza Al Matrooshi, a 24-year-old from Dubai, had one of her ovaries frozen as a nine-year-old and is thought to be the youngest to have had the tissue stored for future use in a pregnancy.
Doctors delivered her baby at the Portland hospital in London on Tuesday where they said the treatment would give hope to other young women whose fertility was at risk from medical treatments for cancer and other disorders.
Al Matrooshi was born with an inherited blood condition called beta thalassaemia which can be fatal if left untreated. But because the chemotherapy with which doctors tackle the disorder damages the ovaries, she had her right ovary removed at the age of nine. The tissue was frozen and kept in storage in Leeds where the operation had taken place.
Al Matrooshi had chemotherapy and a bone marrow transplant at Great Ormond Street in London to treat her blood condition before doctors in Denmark transplanted slivers of her unfrozen ovarian tissue onto her left ovary, which had stopped working, and on to the side of her uterus.
After the procedure, doctors found that Al Matrooshi’s hormones returned to normal and her periods returned. To improve her chances of conceiving, she had IVF treatment with her husband Ahmed, which allowed doctors to implant two embryos into her womb earlier this year. “It’s like a miracle,” Al Matrooshi told the BBC. “We’ve been waiting so long for this result: a healthy baby.”
Doctors have performed similar operations before and about 60 women have had their fertility restored with frozen ovarian tissue since 2001. Last year a woman who had an ovary frozen at the age of 13 gave birth after doctors used the tissue to restore her fertility. Al Matrooshi may be the first to have had her tissue stored before she reached puberty.
In July, a 33-year-old woman in Edinburgh became the first in Britain to give birth after having frozen ovarian tissue returned to her body. She had had the material frozen in her early 20s after she was diagnosed with a rare form of kidney cancer.
Doctors in Edinburgh are developing a service to store testicular tissue from boys as young as one to help those at risk of infertility after cancer treatment.
Sara Matthews, a consultant gynaecologist at the Portland hospital, said that within three months of having her ovarian tissue re-implanted, Al Matrooshi went from being menopausal to having the ovary function of a normal woman in her 20s.
Helen Picton, who oversaw the tissue-freezing at Leeds University, told the BBC that in Europe alone, several thousand girls and young women have had ovarian tissue frozen and stored. Most have done so in the hope of having their fertility restored after medical treatment for other conditions.
Moaza Al Matrooshi, 24, went into menopause after chemotherapy but had her fertility restored using thawed tissue
https://www.theguardian.com/science/2016/dec/14/healthy-baby-born-to-woman-who-had-her-ovary-frozen-aged-nine?CMP=fb_gu
A woman has given birth to a healthy baby boy after doctors restored her fertility with ovarian tissue she had had frozen as a child.
Moaza Al Matrooshi, a 24-year-old from Dubai, had one of her ovaries frozen as a nine-year-old and is thought to be the youngest to have had the tissue stored for future use in a pregnancy.
Doctors delivered her baby at the Portland hospital in London on Tuesday where they said the treatment would give hope to other young women whose fertility was at risk from medical treatments for cancer and other disorders.
Al Matrooshi was born with an inherited blood condition called beta thalassaemia which can be fatal if left untreated. But because the chemotherapy with which doctors tackle the disorder damages the ovaries, she had her right ovary removed at the age of nine. The tissue was frozen and kept in storage in Leeds where the operation had taken place.
Al Matrooshi had chemotherapy and a bone marrow transplant at Great Ormond Street in London to treat her blood condition before doctors in Denmark transplanted slivers of her unfrozen ovarian tissue onto her left ovary, which had stopped working, and on to the side of her uterus.
After the procedure, doctors found that Al Matrooshi’s hormones returned to normal and her periods returned. To improve her chances of conceiving, she had IVF treatment with her husband Ahmed, which allowed doctors to implant two embryos into her womb earlier this year. “It’s like a miracle,” Al Matrooshi told the BBC. “We’ve been waiting so long for this result: a healthy baby.”
Doctors have performed similar operations before and about 60 women have had their fertility restored with frozen ovarian tissue since 2001. Last year a woman who had an ovary frozen at the age of 13 gave birth after doctors used the tissue to restore her fertility. Al Matrooshi may be the first to have had her tissue stored before she reached puberty.
In July, a 33-year-old woman in Edinburgh became the first in Britain to give birth after having frozen ovarian tissue returned to her body. She had had the material frozen in her early 20s after she was diagnosed with a rare form of kidney cancer.
Doctors in Edinburgh are developing a service to store testicular tissue from boys as young as one to help those at risk of infertility after cancer treatment.
Sara Matthews, a consultant gynaecologist at the Portland hospital, said that within three months of having her ovarian tissue re-implanted, Al Matrooshi went from being menopausal to having the ovary function of a normal woman in her 20s.
Helen Picton, who oversaw the tissue-freezing at Leeds University, told the BBC that in Europe alone, several thousand girls and young women have had ovarian tissue frozen and stored. Most have done so in the hope of having their fertility restored after medical treatment for other conditions.
44
Business & Entrepreneurship / Narendra Modi wants to crack down on “black money”. Will it actually work?
« on: November 18, 2016, 09:34:25 AM »
India: Narendra Modi’s bonfire of the rupees
A debate rages over the effect of the prime minister’s crackdown on ‘black’ money
by: Amy Kazmin
https://www.ft.com/content/0467b734-ac23-11e6-ba7d-76378e4fef24
India, at the start of this year, began requiring retailers that received more than Rs200,000 ($3,000) in cash from a customer to report details of the sale — and the buyer’s taxpayer identification number — to tax officials. The impact on Ethos Watches, a luxury watch retail chain with 45 stores, was immediate: sales plunged 60 per cent. Before the new rule, 45 per cent of the company’s sales were of Swiss timepieces worth more than Rs200,000 — often bought with suitcases full of notes.
“People are no longer able to make cash purchases of expensive products without the risk that they will be called by the income tax department inquiring where they got so much cash from,” Yasho Saboo, Ethos’s owner, told the Financial Times a few months after the new regulation took effect.
Strict monitoring of large cash payments was the opening salvo in Prime Minister Narendra Modi’s campaign to crack down on “black money” — cash earned through illegal activities, or earned legally but never declared to tax officials. The campaign hit its apogee last week, with New Delhi’s surprise ban on the use of Rs500 and Rs1,000 notes — a radical action intended to catch black money hoarders.
The scrapped currency — together worth more than $220bn, or 86 per cent of India’s circulating cash — is no longer legal tender and the notes are not supposed to be used for any transactions, except buying fuel at state petrol pumps or in government hospitals. Until December 30, the notes, worth $7.50 and $15 respectively, can be deposited in bank accounts or exchanged in small quantities over the counter for new currency. But income tax officials will be alerted to any deposit of more than Rs250,000, a sign of the widening campaign against corruption and tax evasion.
The cash ban, which Mr Modi had kept secret until it was announced on November 8, has shocked India just as it was beginning its frenetic high-spending wedding season. Markets are deserted, except for banks and automatic teller machines deluged by desperate Indians on a quest for cash. “I know the forces up against me,” Mr Modi said in a speech this week. “They may not let me live. They may ruin me because their loot of 70 years is in trouble.”
As the Indian government struggles to overcome logistical bottlenecks that have impeded distribution of the new currency, debate is raging over just how effective the draconian measure will be in combating black money. There are also questions about its impact on the wider economy. In India, circulating cash is 14 per cent of GDP, compared with less than 5 per cent in other large economies. Nearly 80 per cent of consumer transactions are in cash. Many of those have now come to a halt.
The stealth decision to abruptly cancel and replace most of India’s currency is a radical economic experiment, and political gamble, with few precedents. Some western economists such as Kenneth Rogoff, professor of public policy and economics at Harvard University, have advocated the gradual phasing out of high-value notes to combat crime in advanced economies, which tend to be far less cash dependent. The European Central Bank is slowly withdrawing the €500 note over concerns that it facilitates illegal activity and tax evasion.
But, until now, large-scale overnight demonetisation and currency replacement exercises have only occurred in countries in the midst of state or economic collapse — such as in Germany after the second world war, or the former Soviet Union — or in the throes of hyperinflation. Such disruption has never been inflicted on a country that was ticking along nicely like India, where GDP grew at an annual rate of 7.1 per cent from April to June this year.
“No country has done this kind of shock therapy,” says Jahangir Aziz, global emerging markets analyst at JPMorgan. “We don’t have any precedents of doing anything of this sort. We are flying by the seat of our pants.”
Swapan Dasgupta, a member of India’s upper house of parliament, says the move is intended as a radical shake-up of Indian society, where corruption and tax evasion, by businesses and affluent individuals, is a way of life. It is a big risk for Mr Modi, whose supporters include wholesale and retail traders, known for their non-transparent cash dealings.
“It’s motivated by a philosophy which is that if you want India to be a meaningful player on the world economic stage, you’ve got to take tough measures,” says Mr Dasgupta, who has close ties to Mr Modi’s ruling Bharatiya Janata party. “Otherwise you can plod on.”
India’s tax to GDP ratio is just 16.6 per cent, some 5.4 percentage points less than comparable countries, the government estimates. Just 5.5 per cent of Indian earners pay income taxes, while nearly 85 per cent of the economy is outside the tax net. Mr Modi’s hope appears to be the cash crunch will force many businesses to start using banks or digital payments, so their income can be monitored.
“It really is shock treatment, declaring total war on a particular way of conducting business,” says Mr Dasgupta. “But it’s a huge political risk. The traders are your biggest political base and you’ve really hit the traders the most. They don’t consider it black money. They’ve been doing it like this for generations.”
‘The clever find ways around it’
Indians’ attachment to cash — and tendency to conceal their income — dates back to the socialist era of Indira Gandhi in the 1970s, when income tax rates rose to nearly 98 per cent and government officials had extensive control over business. Income tax rates have fallen sharply since. But property purchases are still taxed heavily, giving buyers and sellers a shared incentive to understate property values. Officials retain vast discretionary powers, often used to amass illicit wealth.
“There is not a soul in India who has not paid black money,” says Surjit Bhalla, senior India analyst for the New York-based Observatory Group, an economic consultancy. Mr Bhalla admits he caved in to pressure in the 1990s to pay Rs300,000 to a Delhi city official who withheld permission for him to build a house for two years. “We have created an environment in which everybody is forced to be corrupt,” he says.
India has demonetised to try to flush out black money once before. In 1978, New Delhi scrapped what were then truly high value notes — denominations of Rs1,000, Rs5,000 and Rs10,000, which then accounted for 2 per cent of the country’s entire cash supply — and gave holders a week to exchange them. Recently, anti-corruption campaigners embraced the idea that India needed another round of such medicine.
Yet Raghuram Rajan, the recently departed governor of the Reserve Bank of India, was sceptical about the effectiveness of demonetisation as a means of purging black money from the economy. Most illicit wealth in India is believed to be held in property and gold, not the sacks of cash depicted in Bollywood films. “My sense is the clever find ways around it,” Mr Rajan said two years ago. “They find ways to divide up their hoard into many smaller pieces … It is not that easy to flush out black money.”
It is unclear who convinced Mr Modi to take the gambit. Influential yoga guru Baba Ramdev has tried to claim credit. But others suggest the real champion was Anil Bokil, an accountant who founded an obscure Pune-based non-profit, ArthaKranti. His group has gained influence in rightwing circles with its vision of radically restructuring India’s economy, including abolishing banknotes larger than Rs50 and scrapping income tax.
This summer, Mr Bokil reportedly had an audience with Mr Modi that lasted nearly two hours. “In India, if you lobby hard enough with the prime minister’s office and say, ‘I have no vested interest,’ you get a few minutes to present your idea,” said Saurabh Mukherjea, chief executive of Ambit Capital, a Mumbai brokerage. “There was no real debate on the subject and no conventional economist mooted the idea — certainly not on the scale in which it’s been done.”
Economists agree that the sudden cash crunch will be a painful blow to the economy initially. Analysts estimate that the ban on the notes will shave about 1 per cent from GDP growth in the current financial year, which ends in March. “This is a large, negative sudden shock and the impact on real activity is going to be large and negative in the short run,” said Mr Aziz.
According to Deutsche Bank, fast-moving consumer goods sales have dropped 30 per cent in some regions, while consumer durables in small towns are at a standstill. Much of India’s trucking fleet, which relies on cash for tolls and taxes, is stranded on the highways. “All kinds of cash-based businesses are all gumming up,” says Rajiv Lall, chief executive of IDFC Bank.
Property prices have also been hard hit, with implications for the employment-intensive construction sector. In the longer term, it is seen as good news for aspiring homebuyers. “On average, you are likely to see a 50 per cent correction in residential real estate prices,” says Ambit’s Mr Mukherjea.
Long-term benefits
The full impact of the negative shock will depend on how fast the government can roll out the replacement cash. So far, the process has been agonisingly slow, as each ATM needs physical recalibration to handle the new notes, which are slightly smaller in size than the old ones. “You need to solve, as quickly as possible, the challenge of introducing new currency into the market,” Mr Lall says.
Despite the difficulties, many economists, and even ordinary Indians, believe Mr Modi’s shock therapy will yield long-term benefits. Higher levels of bank deposits can facilitate lower interest rates and greater lending, while traditional businesses will be under pressure to find alternatives to cash and come under the tax net. “There is an economic argument that if you get black money into the formal economy it does improve public finances,” says Rajeev Malik, senior economist at CLSA.
No one knows how much cancelled cash will return to the banks, and how much will be purged from the system. Cynics claim many working-class Indians who have been queueing at banks to exchange up to Rs4,500 are “mules”, being paid by the wealthy to launder their money. Others with excess, illicit cash are looking to friends and family to help get their money into the banking system — and offering a handsome price. Experts say the note ban will do little to stop new black money.
Mahesh Rewaria, who sells phone accessories from a tiny stall, says his sales fell 60 per cent after the ban and have yet to fully recover. Yet he supports Mr Modi’s move. “It’s only those who were not paying taxes and stealing from the government that have to worry. I am included in that,” he says. “I would have always wanted to pay my taxes fairly, but then I would think why should I, when other people are so corrupt.”
Politics: Cash policy could hit Modi’s rivals in the purse
Many Indians are dismayed that Prime Minister Narendra Modi’s ban on Rs500 and Rs1,000 notes hit at the start of the annual wedding season — a moment when families spend significant amounts of their savings on elaborate nuptial celebrations.
But analysts believe Mr Modi was thinking more about the political season ahead of crucial elections in Uttar Pradesh, India’s largest state, in the first few months of next year.
With 80 parliamentary seats, Uttar Pradesh is critical for Mr Modi’s re-election prospects in 2019, and he is eager for his Bharatiya Janata party to win control of the state administration, which would offer him strong advantages in the national election.
With his move, he has reinforced his image as a strong, decisive leader, willing to take bold decisions in a country typically inclined to incremental change. It may have had an added benefit: the cash crackdown is thought to have inflicted significant financial damage on his political rivals, some of whom could have felt a hit to their own cash stashes just as they are gearing up for the campaign.
“The BJP’s monetisation scheme is politically monopolistic in intent as it aims to wipe out the cash reserves of other parties,” wrote Sushil Aaron of The Hindustan Times.
But Mr Modi’s gamble risks backfiring. Many rural Indians store their hard-earned savings, such as they possess, in cash in high denomination notes at their homes. Now, they face the challenge of trying to deposit that money into distant banks — or see it turned into worthless pieces of paper. Rural dwellers depend even more on cash than city residents. It remains to be seen whether they will share in Mr Modi’s enthusiasm for purging black money.
A debate rages over the effect of the prime minister’s crackdown on ‘black’ money
by: Amy Kazmin
https://www.ft.com/content/0467b734-ac23-11e6-ba7d-76378e4fef24
India, at the start of this year, began requiring retailers that received more than Rs200,000 ($3,000) in cash from a customer to report details of the sale — and the buyer’s taxpayer identification number — to tax officials. The impact on Ethos Watches, a luxury watch retail chain with 45 stores, was immediate: sales plunged 60 per cent. Before the new rule, 45 per cent of the company’s sales were of Swiss timepieces worth more than Rs200,000 — often bought with suitcases full of notes.
“People are no longer able to make cash purchases of expensive products without the risk that they will be called by the income tax department inquiring where they got so much cash from,” Yasho Saboo, Ethos’s owner, told the Financial Times a few months after the new regulation took effect.
Strict monitoring of large cash payments was the opening salvo in Prime Minister Narendra Modi’s campaign to crack down on “black money” — cash earned through illegal activities, or earned legally but never declared to tax officials. The campaign hit its apogee last week, with New Delhi’s surprise ban on the use of Rs500 and Rs1,000 notes — a radical action intended to catch black money hoarders.
The scrapped currency — together worth more than $220bn, or 86 per cent of India’s circulating cash — is no longer legal tender and the notes are not supposed to be used for any transactions, except buying fuel at state petrol pumps or in government hospitals. Until December 30, the notes, worth $7.50 and $15 respectively, can be deposited in bank accounts or exchanged in small quantities over the counter for new currency. But income tax officials will be alerted to any deposit of more than Rs250,000, a sign of the widening campaign against corruption and tax evasion.
The cash ban, which Mr Modi had kept secret until it was announced on November 8, has shocked India just as it was beginning its frenetic high-spending wedding season. Markets are deserted, except for banks and automatic teller machines deluged by desperate Indians on a quest for cash. “I know the forces up against me,” Mr Modi said in a speech this week. “They may not let me live. They may ruin me because their loot of 70 years is in trouble.”
As the Indian government struggles to overcome logistical bottlenecks that have impeded distribution of the new currency, debate is raging over just how effective the draconian measure will be in combating black money. There are also questions about its impact on the wider economy. In India, circulating cash is 14 per cent of GDP, compared with less than 5 per cent in other large economies. Nearly 80 per cent of consumer transactions are in cash. Many of those have now come to a halt.
The stealth decision to abruptly cancel and replace most of India’s currency is a radical economic experiment, and political gamble, with few precedents. Some western economists such as Kenneth Rogoff, professor of public policy and economics at Harvard University, have advocated the gradual phasing out of high-value notes to combat crime in advanced economies, which tend to be far less cash dependent. The European Central Bank is slowly withdrawing the €500 note over concerns that it facilitates illegal activity and tax evasion.
But, until now, large-scale overnight demonetisation and currency replacement exercises have only occurred in countries in the midst of state or economic collapse — such as in Germany after the second world war, or the former Soviet Union — or in the throes of hyperinflation. Such disruption has never been inflicted on a country that was ticking along nicely like India, where GDP grew at an annual rate of 7.1 per cent from April to June this year.
“No country has done this kind of shock therapy,” says Jahangir Aziz, global emerging markets analyst at JPMorgan. “We don’t have any precedents of doing anything of this sort. We are flying by the seat of our pants.”
Swapan Dasgupta, a member of India’s upper house of parliament, says the move is intended as a radical shake-up of Indian society, where corruption and tax evasion, by businesses and affluent individuals, is a way of life. It is a big risk for Mr Modi, whose supporters include wholesale and retail traders, known for their non-transparent cash dealings.
“It’s motivated by a philosophy which is that if you want India to be a meaningful player on the world economic stage, you’ve got to take tough measures,” says Mr Dasgupta, who has close ties to Mr Modi’s ruling Bharatiya Janata party. “Otherwise you can plod on.”
India’s tax to GDP ratio is just 16.6 per cent, some 5.4 percentage points less than comparable countries, the government estimates. Just 5.5 per cent of Indian earners pay income taxes, while nearly 85 per cent of the economy is outside the tax net. Mr Modi’s hope appears to be the cash crunch will force many businesses to start using banks or digital payments, so their income can be monitored.
“It really is shock treatment, declaring total war on a particular way of conducting business,” says Mr Dasgupta. “But it’s a huge political risk. The traders are your biggest political base and you’ve really hit the traders the most. They don’t consider it black money. They’ve been doing it like this for generations.”
‘The clever find ways around it’
Indians’ attachment to cash — and tendency to conceal their income — dates back to the socialist era of Indira Gandhi in the 1970s, when income tax rates rose to nearly 98 per cent and government officials had extensive control over business. Income tax rates have fallen sharply since. But property purchases are still taxed heavily, giving buyers and sellers a shared incentive to understate property values. Officials retain vast discretionary powers, often used to amass illicit wealth.
“There is not a soul in India who has not paid black money,” says Surjit Bhalla, senior India analyst for the New York-based Observatory Group, an economic consultancy. Mr Bhalla admits he caved in to pressure in the 1990s to pay Rs300,000 to a Delhi city official who withheld permission for him to build a house for two years. “We have created an environment in which everybody is forced to be corrupt,” he says.
India has demonetised to try to flush out black money once before. In 1978, New Delhi scrapped what were then truly high value notes — denominations of Rs1,000, Rs5,000 and Rs10,000, which then accounted for 2 per cent of the country’s entire cash supply — and gave holders a week to exchange them. Recently, anti-corruption campaigners embraced the idea that India needed another round of such medicine.
Yet Raghuram Rajan, the recently departed governor of the Reserve Bank of India, was sceptical about the effectiveness of demonetisation as a means of purging black money from the economy. Most illicit wealth in India is believed to be held in property and gold, not the sacks of cash depicted in Bollywood films. “My sense is the clever find ways around it,” Mr Rajan said two years ago. “They find ways to divide up their hoard into many smaller pieces … It is not that easy to flush out black money.”
It is unclear who convinced Mr Modi to take the gambit. Influential yoga guru Baba Ramdev has tried to claim credit. But others suggest the real champion was Anil Bokil, an accountant who founded an obscure Pune-based non-profit, ArthaKranti. His group has gained influence in rightwing circles with its vision of radically restructuring India’s economy, including abolishing banknotes larger than Rs50 and scrapping income tax.
This summer, Mr Bokil reportedly had an audience with Mr Modi that lasted nearly two hours. “In India, if you lobby hard enough with the prime minister’s office and say, ‘I have no vested interest,’ you get a few minutes to present your idea,” said Saurabh Mukherjea, chief executive of Ambit Capital, a Mumbai brokerage. “There was no real debate on the subject and no conventional economist mooted the idea — certainly not on the scale in which it’s been done.”
Economists agree that the sudden cash crunch will be a painful blow to the economy initially. Analysts estimate that the ban on the notes will shave about 1 per cent from GDP growth in the current financial year, which ends in March. “This is a large, negative sudden shock and the impact on real activity is going to be large and negative in the short run,” said Mr Aziz.
According to Deutsche Bank, fast-moving consumer goods sales have dropped 30 per cent in some regions, while consumer durables in small towns are at a standstill. Much of India’s trucking fleet, which relies on cash for tolls and taxes, is stranded on the highways. “All kinds of cash-based businesses are all gumming up,” says Rajiv Lall, chief executive of IDFC Bank.
Property prices have also been hard hit, with implications for the employment-intensive construction sector. In the longer term, it is seen as good news for aspiring homebuyers. “On average, you are likely to see a 50 per cent correction in residential real estate prices,” says Ambit’s Mr Mukherjea.
Long-term benefits
The full impact of the negative shock will depend on how fast the government can roll out the replacement cash. So far, the process has been agonisingly slow, as each ATM needs physical recalibration to handle the new notes, which are slightly smaller in size than the old ones. “You need to solve, as quickly as possible, the challenge of introducing new currency into the market,” Mr Lall says.
Despite the difficulties, many economists, and even ordinary Indians, believe Mr Modi’s shock therapy will yield long-term benefits. Higher levels of bank deposits can facilitate lower interest rates and greater lending, while traditional businesses will be under pressure to find alternatives to cash and come under the tax net. “There is an economic argument that if you get black money into the formal economy it does improve public finances,” says Rajeev Malik, senior economist at CLSA.
No one knows how much cancelled cash will return to the banks, and how much will be purged from the system. Cynics claim many working-class Indians who have been queueing at banks to exchange up to Rs4,500 are “mules”, being paid by the wealthy to launder their money. Others with excess, illicit cash are looking to friends and family to help get their money into the banking system — and offering a handsome price. Experts say the note ban will do little to stop new black money.
Mahesh Rewaria, who sells phone accessories from a tiny stall, says his sales fell 60 per cent after the ban and have yet to fully recover. Yet he supports Mr Modi’s move. “It’s only those who were not paying taxes and stealing from the government that have to worry. I am included in that,” he says. “I would have always wanted to pay my taxes fairly, but then I would think why should I, when other people are so corrupt.”
Politics: Cash policy could hit Modi’s rivals in the purse
Many Indians are dismayed that Prime Minister Narendra Modi’s ban on Rs500 and Rs1,000 notes hit at the start of the annual wedding season — a moment when families spend significant amounts of their savings on elaborate nuptial celebrations.
But analysts believe Mr Modi was thinking more about the political season ahead of crucial elections in Uttar Pradesh, India’s largest state, in the first few months of next year.
With 80 parliamentary seats, Uttar Pradesh is critical for Mr Modi’s re-election prospects in 2019, and he is eager for his Bharatiya Janata party to win control of the state administration, which would offer him strong advantages in the national election.
With his move, he has reinforced his image as a strong, decisive leader, willing to take bold decisions in a country typically inclined to incremental change. It may have had an added benefit: the cash crackdown is thought to have inflicted significant financial damage on his political rivals, some of whom could have felt a hit to their own cash stashes just as they are gearing up for the campaign.
“The BJP’s monetisation scheme is politically monopolistic in intent as it aims to wipe out the cash reserves of other parties,” wrote Sushil Aaron of The Hindustan Times.
But Mr Modi’s gamble risks backfiring. Many rural Indians store their hard-earned savings, such as they possess, in cash in high denomination notes at their homes. Now, they face the challenge of trying to deposit that money into distant banks — or see it turned into worthless pieces of paper. Rural dwellers depend even more on cash than city residents. It remains to be seen whether they will share in Mr Modi’s enthusiasm for purging black money.
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Business & Entrepreneurship / Re: ব্যাংকের গোপন প্রতারণা জমজমাট
« on: November 15, 2016, 12:01:51 AM »
Thanks for your comment Tanvir Ahmed Chowdhury sir