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(8/08/2012, International Herald Tribune, by Claire Cain Miller)
State of the Art: Pay by Voice? So Long, Wallet (July 19, 2012) This fall, Square will begin processing all credit and debit card transactions at Starbucks stores in the United States and eventually customers will be able to order a grande vanilla latte and charge it to their credit cards simply by saying their names.
SAN FRANCISCO — Cash moved one small step nearer to its deathbed with the announcement on Wednesday that Square, the mobile payments start-up, would form a partnership with the Starbucks Coffee Company.
Though smartphone payments have a long way to go before they replace wallets altogether, Starbucks’s adoption of Square will catapult the start-up’s technology onto street corners nationwide, and is the clearest sign yet that mobile payments could become mainstream.
“Anyone who’s going to break the mobile payments barrier in the U.S. has to overcome the resistance to try anything new when everything we have works really, really well, even cash, which is very convenient,” said Bill Maurer, director of the Institute for Money, Technology and Financial Inclusion at the University of California, Irvine.
“But if a big merchant jumping into some mobile payment solution signals to other merchants that there is an opportunity here,” he added, “that might change the psychology for other merchants.”
Starbucks is also investing $25 million in Square as part of its latest round of financing, which values the company at $3.25 billion, and Howard D. Schultz, Starbucks’s chief executive, will join Square’s board.
Starbucks has offered its own mobile payment app since last year and processes more than a million mobile payments a week. Customers will continue to be able to use it, but they will also be able to use Pay With Square, Square’s cellphone app, which eliminates even having to take the phone out of your pocket or sign a receipt.
At first, Starbucks customers will need to show the merchant a bar code on their phones. But when Starbucks uses Square’s full GPS technology, the customer’s phone will automatically notify the store that the customer has entered, and the customer’s name and photo will pop up on the cashier’s screen. The customer will give the merchant his or her name, Starbucks will match the photo and the payment will be complete.
Even though Square’s app has been well reviewed, it has not caught on with shoppers, which has been Square’s biggest challenge as it tries to expand. That is in large part because of the limited number of merchants that accept payments that way. Most of Square’s users are small businesses, like farm stands or cafes that also use Square’s credit card reader.
“Starbucks is one of the largest organizations in the world, taking technology like Square — simple, fast and focused on customer experience — and bringing it to a massive scale,” said Jack Dorsey, Square’s co-founder and chief executive.
Square, which was introduced in 2010, is one of many businesses — like Google, PayPal, Sprint and Microsoft and start-ups like Scvngr and GoPago — that are trying to offer mobile payments. But they have been slow to catch on because they require the cooperation of many players, including retailers, credit card companies, banks, cellphone carriers and phone makers. And Americans have been just as happy to pull out their credit cards as their cellphones to make a payment.
Denee Carrington, a Forrester analyst who recently wrote a report on mobile payments, said that mobile payment providers would need to offer a compelling, safe and convenient experience for shoppers, and that the applications would have to make good use of their personal data, like spending habits, to offer valuable services.
Forrester estimates that 30 percent of American mobile phone owners are interested in using mobile payments, based on a survey polling about 7,600 adults in the United States. It found that younger consumers are the most amenable to using mobile wallets. Still, it predicts that it will take another three to five years before mobile payments reach critical mass in the domestic market.
“We are still in the early days of mobile payments specifically, but the market is accelerating, especially the amount of innovation that’s happening in the marketplace,” Ms. Carrington said.
Square has so far been most popular in small coffee shops, but Mr. Dorsey and Mr. Schultz said that even though the start-up was now doing business with the nation’s biggest coffee chain, the partnership would benefit those small businesses. More customers will have the app, they said, and it will show small businesses near Starbucks stores.
“My hope is that by creating a national footprint for Square technology in all Starbucks stores in the U.S., that it will be a catalyst for Square to get access to tens of thousands of other small business and democratize payments,” Mr. Schultz said.
7 ago. 2012
(07/08/2012, The Japan Times, by Michael Hoffman)
"Democracy is so popular these days!" — "The Democracy Song," 1919
Taisho's turbulence was of an intensity and significance way out of proportion to its brevity. It was a revolution — a failed revolution, as the militarism of the 1930s was to show. Meanwhile, exuberance reigned — exuberance of a peculiar kind. Something of its spirit comes across in the reaction of novelist Junichiro Tanizaki (1886-1965) to the earthquake which incinerated much of his native Tokyo, killing roughly 100,000 people: "Almost simultaneously I felt a surge of happiness which I could not keep down. 'Tokyo will be better for this!' I said to myself."
A child as Taisho dawned would have had grandparents molded by the Edo Period (1603-1867), living symbols of how startlingly Japan had changed within living memory. Edo Japan, closed to the outside world and drifting in a samurai and Confucian time-warp, would have seemed as archaic to Emperor Taisho's subjects as it does to us. In 1912 only 58 years had passed since the United States pried Japan open like a rusty sardine can. Between Edo and Taisho stood the stern and patriarchal Meiji Era (1868-1912), surely one of the most energetic regimes in world history. British historian Richard Storry (in "A History of Modern Japan," 1960) enumerates the most visible innovations — many others, institutional and psychological, were less visible — of Meiji's first two decades: "Banks, railways, harbors, lighthouses, dockyards, telegraph offices, printing presses and newspapers, post offices, cigars and cigarettes — the entire apparatus of Western material civilization seemed to find some reproduction, some kind of echo, in Japan."
Such was Meiji. The emperor posthumously named for the era (he was Emperor Mutsuhito while he lived) was a grave, dignified figure. Actual power was wielded not by him and certainly not by "the people." It was wielded by a narrowly exclusive oligarchy, but Emperor Meiji was a worthy symbol of the modernization effected in his name, and of the era's most characteristic slogan: "Rich country, strong army."
His son and successor, Emperor Yoshihito (posthumously Taisho), marked a shift of gears — or maybe a stripping of gears. A bout of cerebral meningitis as an infant left him with lifelong brain damage. Lucid intervals alternated with spells when no one knew quite what he would do. A characteristic story is of him attending a Diet session and peering at the proceedings through a rolled-up document as through a telescope. He was unpresentable, and more or less faded from public view, a skeleton in the nation's closet. (From 1921 until his death on Christmas Day in 1926 his son, the future Emperor Showa, served as regent.) If a "Jazz Age" is to bloom under a divine emperor, it probably should be one like Emperor Taisho.
Ero-guro-nansensu — where to begin?
Flapper: "Tipsy" (1930) by Kobayakawa Kiyoshi captured the liberated modern girl to a tee.
The Taisho Era transfigured the Japanese character. New types abounded. Meet mobo and his sister (or lover) moga — modern boy and modern girl respectively — mobo in bell-bottom trousers, floppy tie, colored shirt and round-rimmed roido spectacles (named for American silent film star Harold Lloyd), moga having shed her "shapeless, unbecoming kimono" (the description is Tanizaki's) in favor of "Western clothes" that "accentuate every curve and hollow, give her body a brilliant surface and lively flowing lines." Mobo's hair was long, moga's short, sometimes boyishly short; sexuality was out in the open now and not to be hemmed in by simplistic old categories like "male" and "female."
Where did mobo and moga hang out? Most typically, in the new European-style cafes springing up here, there and just about everywhere, especially in the Ginza, Tokyo's little Europe. The first one opened in 1911 (coffeehouses, quite different, had been around for a generation); by 1939, nationwide, they numbered 37,000. To the cafes streamed mobo and moga and all their various sub-species.
Disputation raged. This was not, by our standards, an educated generation — in 1920 less than half the population got beyond the six years of compulsory schooling, with senior high school, let alone university, accessible to barely 1 percent of boys and the merest handful of girls. But Tokyo — population 2 million plus and one of the largest cities in the world — had one of the world's largest student populations. Literacy was widespread if not necessarily advanced; newspapers, magazines and books proliferated. The Communist Manifesto was translated in 1904; "Marx Boys" and "Marx Girls" pored over it, and the cafes were the backdrop for their fierce arguments over the fine points.
Not only Marx but "Dekansho" — Descartes, Kant and Schopenhauer — were the fashionable philosophical mentors of the day, and a lesson drawn from them was that the world was not merely to be accepted as given but recreated according to reason and justice. This implied varying degrees of action and commitment.
Most were content merely to read, debate and give themselves intellectual airs. Others — Bolsheviks, anarcho-syndicalists, radical feminists — were poised for action; for blood if necessary. The burgeoning industrial-capitalist society that surrounded them, with its machines, its factories, its appalling working conditions, its stark contrasts of grinding poverty and plutocratic wealth, was in their eyes irredeemably corrupt, debased, evil. They nurtured one hope for salvation: its utter destruction. From its ashes, they passionately believed, a new society would arise, more human, more compassionate, more fulfilling. The details were vague. The details could wait.
Relatively few were so grimly, deadly serious (not even the grimly serious ones were grimly serious all the time, and "free love" was no small part of the revolutionary ethos). More prosaic preoccupations were reflected in types who would seem very familiar to us today, however odd to their parents.
There were, first of all, the entrepreneurs, not only of heavy industry but of consumer goods. Prominent among them was the young electrician Konosuke Matsushita (1894-1989). In the early 1920s, bicycles' lamps were still mounted candles in a glass-fronted box — imagine that in even a moderate breeze. The company that grew up around Matsushita's electric bicycle lamp became Matsushita Electric — now Panasonic, the world's largest manufacturer of consumer electronic products.
The 9-to-5 company salaryman became numerous in this period, as did the newly fledged "working girl" reveling in her financial independence. Department store clerk, train station ticket-seller, teacher, telephone operator, typist, elevator girl, nurse, writer, journalist, beautician — a Taisho woman might don any one of these identities.
Female perspective: The first issue of the women's literary magazine Seito (Blue-Stocking), founded in 1911 by feminist Raicho Hiratsuka (1886-1971).
Beautician? Japan's first Western-style hair salon opened in March 1923, six months before the Great Kanto Earthquake which, to many conservatives, was heaven's wrathful judgment on all this frivolous tinkering with native tradition. Chieko Yamano, 27 years old and just back from training in New York, set up her parlor on the fourth floor of the Maru Building, Asia's largest structure at the time, just across the street from Tokyo Station. She employed 20 assistants, all in Western clothes and Western coiffeur. Conventional Japanese notions of feminine beauty, reflected in the languid poses of 18th- and 19th-century ukiyo-e ("floating world" prints), were, if not out, clearly on the defensive. Not even the earthquake brought them much of a revival.
Or, a Taisho woman might — and many, many did — become a jokyū (cafe waitress), serving coffee, whisky, wine and hotto sandoitchi (hot sandwiches), granting or withholding sexual favors as she saw fit. So numerous, so bright, charming and above all "modern" were the jokyū of Taisho — by 1936 there were some 112,000 of them — that, remove them from the scene and it dims perceptibly. Male customers fawned on them. Unlike all but the highest-ranking courtesans of the traditional licensed pleasure-quarters, the jokyū was her own mistress, free to accept this homage or reject it. One jokyū is remembered for a pert rejoinder to a smitten mobo's eager advances. "I do the seducing," she snapped.
World War I "sent Europe to its knees and brought Japan to its feet," as historian Jeffrey Hanes put it (in "Media Culture in Taisho Osaka," 1998).
European and American industry's all-out mobilization for war created a vacuum that Japanese heavy industry, then in its infancy, rose to fill. The resulting war boom seeded Taisho's cultural and social ferment. There were fortunes to be made, and those quick to seize the opportunity made them, more or less irrespective of birth.
The salarymen who staffed their offices became the new middle class. Rougher types, male and female, kept their factories humming, suffering the attendant evils of long hours, low pay and an overall standard of living not much above brutality. "On those machines fall my tears," went a song lyric of the day.
Proletarian literature has its place in Taisho culture alongside less ephemeral literary celebrations of eros and the new freedom. "I was in the war and I can tell you that to spend eight hours down there in that mine was worse than 24 hours under enemy fire" — so testifies a mine worker in "The Handstand," a short story published in 1920 by Mimei Ogawa. "What the hell," the mine worker continues, "we were risking our lives down there every day to make profits for the company. We all got together and were going to make a set of minimum demands for our safety — not wages, mind you, just for our safety. But we had an informer among us. Our plan leaked out and the company put a stop to it all."
Hub of the nation: Tokyo Station shortly after it opened, in 1914.
(03/08/2012, The New York Times, by George Johnson)
It’s no wonder Nazis hated relativity. They lived in a world of absolutes. There was a master race with one true religion and one true language, with a music and literature that celebrated its glory. There was a true German empire, sliced up by the arbitrary boundaries of concoctions called nation-states. With absolute might the Fatherland would regain its proper position in space and time.
Now comes this Einstein. Without even the benefit of a proper German education, he was fiddling with numbers and symbols and through some kabbalistic magic conjuring a universe in which it was impossible to say where you were. You could only describe your position in relationship to something else — which could only describe its position in relationship to you.
In Einstein’s cockeyed scheme you couldn’t even say with authority what time it was. Again, your time was relative to their time and their time was relative to yours. This was from his Special Theory of Relativity. The sequel, General Relativity, was even weirder. Gravity is the curvature of some four-dimensional mind stuff called space-time. It was a trick of the Elders of Zion, some philosophical disease. “Scientific Dadaism,” a prominent German scientist called it.
This wasn’t just a fringe view. Philipp Lenard, who won a Nobel Prize for his work on cathode rays, wrote a four-volume treatise on the one true science and called it “German Physics.” In the foreword he touched on “Japanese Physics,” “Arabian Physics” and “Negro Physics.” But he saved his wrath for the physics of the Jews. “The Jew wants to create contradictions everywhere and to separate relations, so that preferably, the poor naïve German can no longer make any sense of it whatsoever.” Einstein’s theories, he wrote, “never were even intended to be true.” Lenard just didn’t understand them.
“Jewish physics.” With Einstein’s theories now at the bedrock of modern science, the Nazi’s words have been justly forgotten. It seems almost perverse that Steven Gimbel, the chairman of the philosophy department at Gettysburg College, would want to bring back the old epithet and give it another spin. In his original new book, “Einstein’s Jewish Science: Physics at the Intersection of Politics and Religion,” he considers the possibility that the Nazis were on to something. If you can look past the anti-Semitism, he proposes, “maybe relativity is ‘Jewish science’ after all.” What he means is that there might have been elements of Jewish thinking that gave rise to what is now recognized as one of the deepest insights of all time.
By casting Einstein as a philosophical anarchist, the Nazis missed the heart of his idea. Length contracts and time slows as an object speeds through space. But they have to in order to preserve what is truly absolute: the speed of light. Suppose Martians are watching us. Because light travels at a fixed velocity, what they are seeing from their perspective took place here about four minutes ago. If they could outrun the light beams bringing them the news, they could arrive before an event occurred — prevent the invasion of Poland, the attack on Pearl Harbor or the dropping of the atomic bomb. The theory Einstein discovered ensures that the world isn’t even crazier than it is.
Einstein, Gimbel argues, was especially well put to come upon such insights because he was a Jew. Gimbel is not saying that Einstein was deeply religious. When he talked about “the secrets of the Old One” or God playing dice, he was being a little ironic, using the idea of a deity he didn’t believe in as a metaphor for the laws of the universe. Nor does Gimbel find any particularly Jewish ideas in Einstein’s science or signs that, as the Nazis contended, it was politically motivated. I don’t think many will need convincing on those points. But Gimbel is an engaging writer. In demonstrating the obvious, he takes readers on enlightening excursions through the nature of Judaism, Hegelian philosophy, wherever his curiosity leads.
He dismisses Lenard’s argument that there was something characteristically Jewish about the way Einstein put together his theory. Instead of trekking through nature like a robust German scout, with magnifying glass and telescope in his rucksack, he sat alone in his room scribbling numbers like a shut-in. For an old-school physicist like Lenard, that wasn’t how science is done. Experiment and observation come first, providing the data that the theorists then seek to explain.
In fact, Lenard was falling behind the time. As the 20th century progressed, theory was often driving experiment — predicting from the logic of the equations phenomena for the experimenters to confirm. But there was nothing particularly Jewish about that. It was more Herr Professor Heisenberg’s style than Einstein’s. Einstein’s own ideas sprang from his intuitions about nature — insights that came from thought experiments. They were imaginary but in principle they could be done: trains flashing signals back and forth, an elevator hurtling down a shaft or floating through space.
What gives Einstein’s work a Jewish flavor, Gimbel believes, is an approach to the universe that reminds him of the way a Talmudic scholar seeks to understand God’s truth. It comes only in glimpses. “Thou shalt not steal” may seem clear enough. But is it stealing to keep a $100 bill you find on the ground? It depends. Did you see the person who might have dropped it? Was it found on a busy street or in a friend’s backyard? In a hotel lobby with a lost and found? Without the luxury of a God’s-eye view, we must reckon from different vantage points.
“The heart of the Talmudic view is that there is an absolute truth, but this truth is not directly and completely available to us,” Gimbel writes. “It turns out that exactly the same style of thinking occurs in the relativity theory and in some of Einstein’s other research.”
From our blinkered perspective we see qualities called space and time. But in relativity theory, the two can be combined mathematically into something more fundamental: a four-dimensional abstraction called the space-time interval. Time and space vary according to the motion of the observer. But from any vantage point, an object’s space-time interval would be the same — the higher truth that can be approached only from different angles. The same kind of thinking, Gimbel says, also led to Einstein’s thought experiments with the elevator showing that when we feel the pull of gravity from the Earth or the push of acceleration from the takeoff of a jet, we are experiencing the same underlying phenomenon.
Gimbel isn’t saying that only a Jew could have discovered these things but that being Jewish just might have given Einstein an edge. In any case, someone like Lenard could not have made such leaps. His German physics, with its constipated view of science, was becoming as anachronistic as his politics.
5 ago. 2012
(4/08/2012, New York Times)
SMYRNA, Tenn. — The dairy farms that once draped the countryside here were paved over so the Japanese carmaker Nissan could build its first American assembly plant. Eighty miles to the south, another green pasture was replaced by a Nissan engine factory, and across Tennessee about 100 Nissan suppliers dot the landscape, making steel in Murfreesboro, air conditioning units in Lewisburg, transmission parts in Portland.
Three decades ago, none of this existed. The conventional wisdom at the time was simple: Japanese automakers would not build many cars anywhere but Japan, where supply chains were in place, costs were tightly controlled and the reputation for quality was unparalleled.
“They were very unfamiliar doing anything outside Japan,” said Senator Lamar Alexander, a Republican who was governor of Tennessee when Nissan opened its factory here in 1983. “They were tentative and awkward even discussing it.”
Today, echoes of that conventional wisdom can be heard within the American technology industry. For years, high-tech executives have argued that the United States cannot compete in making the most popular electronic devices. Companies like Apple, Dell and Hewlett-Packard, which rely on huge Asian factories, assert that many types of manufacturing would be too costly and inefficient in America. Only overseas, they have said, can they find an abundance of educated midlevel engineers, low-wage workers and at-the-ready suppliers.
But the migration of Japanese auto manufacturing to the United States over the last 30 years offers a case study in how the unlikeliest of transformations can unfold. Despite the decline of American car companies, the United States today remains one of the top auto manufacturers and employers in the world. Japanese and other foreign companies account for more than 40 percent of cars built in the United States, employing about 95,000 people directly and hundreds of thousands more among parts suppliers.
The United States gained these jobs through a combination of public and Congressional pressure on Japan, “voluntary” quotas on car exports from Japan and incentives like tax breaks that encouraged Japanese automakers to build factories in America. Pressuring technology companies to move manufacturing here would pose different challenges. For one thing, Apple and many other technology giants are American, not foreign, and so are viewed differently by politicians and the public. But it is possible and the benefits might be worth it, some economists say.
“The U.S. has a long history of demanding that companies build here if they want to sell here, because it jump-starts industries,” said Clyde V. Prestowitz Jr., a senior trade official in the Reagan administration who helped negotiate with Japan in the 1980s. The government could also encourage domestic production of technologies, including display manufacturing and advanced semiconductor fabrication, that would nurture new industries. “Instead, we let those jobs go to Asia, and then the supply chains follow, and then R&D follows, and soon it makes sense to build everything overseas,” he said. “If Apple or Congress wanted to make the valuable parts of the iPhone in America, it wouldn’t be hard.”
One country has recently succeeded at forcing technology jobs to relocate. Last year, Brazilian politicians used subsidies and the threat of continued high tariffs on imports to persuade Foxconn — which makes smartphones and computers in Asia for dozens of technology companies — to start producing iPhones, iPads and other devices in a factory north of São Paulo. Today, the new plant has 1,000 workers, and could employ many more. Apple and Foxconn declined to comment about the specifics of their Brazilian manufacturing.
However, a developing country like Brazil can adopt trade policies that would be difficult for the United States to do. Taking a hard line to reduce imports of technology goods and encourage domestic manufacturing could violate international trade agreements and set off a trade confrontation. “We’re a long way from even talking about limits on imported iPhones or iPads,” said a former high-ranking Obama administration official who did not want to be named because he was not authorized to speak.
Protectionism is bad policy in today’s globalized world, many economists argue. Countries benefit most when they concentrate on what they do best, and trade barriers harm consumers by driving up prices and undermine a nation’s competitiveness by shielding industries from market forces that spur innovation. The United States needs to create new jobs, economists say, but it should not chase low-paid electronics assembly work that at some point may be replaced by robots. Instead, it should focus on higher-paying jobs.
“Closing our border is a 20th-century thought, and it will only weaken the economy over the long term,” said Andrew N. Liveris, president of Dow Chemical and co-chairman of the Advanced Manufacturing Partnership, a group of executives and academics convened by the White House who have studied ways to encourage domestic manufacturing.
The debate is not just economic, however. Increasingly, it is political. With high unemployment, the question of how to create jobs has taken a role in the presidential race between President Obama and Mitt Romney, and both have traded barbs on outsourcing by American companies.
Although the car and technology industries are different, and the eras are separated by 30 years, the resurgence of American auto manufacturing in the 1980s is an example of how one industry created tens of thousands of good jobs. Since its first pickup truck rolled off the line here on June 16, 1983, Nissan has produced more than seven million vehicles in the United States. It now employs 15,000 people in this country. It makes more than a half-million cars, trucks and S.U.V.’s a year, with the plant in Smyrna building six models, including the soon-to-be-produced, all-electric Nissan Leaf.
Other foreign carmakers settled in America — Honda, Toyota, Hyundai, BMW, Mercedes-Benz and, most recently, Volkswagen — after a failed attempt decades ago. And some of those factories have become among the best in the world. The Nissan engine plant in Decherd, Tenn., for instance, exports engines to Japan. “We have 14 companies now that produce light vehicles here, and that is enormous,” said Thomas Klier, a senior economist at the Federal Reserve Bank in Chicago. “There is no major market in the world that compares to it.”
“Where is Tennessee?”
It was a blunt question, posed by Takashi Ishihara, president of Nissan, to Mr. Alexander, then the state’s governor.
Mr. Alexander, who had journeyed to Tokyo in 1979 to pitch Nissan on building a plant in his state, was ready with his answer: “I said, ‘It’s right in the middle.’ ” To help out, he displayed a satellite photograph of the United States at night, showing the bright lights shining on the East and West Coasts and the relative darkness of Tennessee.
“We were the third-poorest state in the nation back then,” Mr. Alexander said. “President Carter had told all the U.S. governors to go to Japan and persuade the Japanese to make in the U.S. what they sell in the U.S.”
Mr. Alexander recalled that the Nissan executives were “incredibly anxious” about testing their homegrown production systems abroad. Could the Japanese car companies achieve the same quality using American workers?
Despite the concerns, pressures were growing for Nissan to break out of its manufacturing cocoon in Japan, including currency fluctuations that made exporting more expensive. The final push came from American anger as imports grabbed one-fourth of the United States market.
“Japanese automakers had achieved rapid growth by exporting to America,” said Hidetoshi Imazu, a senior manufacturing executive at Nissan in Tokyo who led the development of the plant here in its early years. “But it was clear that model would no longer work.”
In the fall of 1980, Congress held hearings to limit Japanese imports. With tensions running high, Nissan announced plans for the $300 million assembly plant in Smyrna. That gave the company a head start in circumventing looming restrictions. In May 1981, Japan agreed to limit exports to America to 1.68 million cars annually, a 7 percent reduction from a year earlier. In addition, the United States imposed a 25 percent tax on imported pickup trucks.
“The pressure put on the Japanese was absolutely critical for them to agree to export restraints,” said Stephen D. Cohen, a professor emeritus of international studies at American University.
Rural Tennessee may not have seemed a likely place to build a giant automotive factory, but its location was actually a selling point. It was far from Detroit and the United Auto Workers — and the Japanese wanted to work without what they saw as union interference. Nissan’s choice of Tennessee was not popular with everyone. On a 20-degree February morning in 1981, trade unionists jeered Mr. Alexander and Nissan executives as they turned the first shovelfuls of dirt for the factory, protesting nonunion construction crews. An airplane circled overhead, urging a boycott of Japanese vehicles.
Standing nearby was Marvin Runyon, a 37-year veteran of Ford who had been recruited as Nissan’s first American plant manager. In a later interview with The New York Times, Mr. Runyon was asked what his old colleagues in Detroit thought of his new job. “They wish me luck,” he said. “But not too much.”
Success did not come overnight. Many Japanese were skeptical of their new colleagues. Americans, they had heard, were soft, lazy and incapable of mastering the precision manufacturing that had made Nissan great.
To train its new American engineers, Nissan flew workers to its Zama factory in eastern Japan. There the Nissan officials, assisted by English-speaking Japanese workers called “communication helpers,” imparted the intricacies of the company’s production techniques to the Americans.
Beginnings at Nissan
Early on, Nissan guarded against quality concerns by not relying on parts from American suppliers. Most components were either shipped from Japan or produced by Japanese companies that set up operations nearby. “We felt sourcing parts in the U.S. wouldn’t allow us to make cars in our own way,” said Mr. Imazu, the Nissan manufacturing executive.
By 1985, Nissan was confident enough about the quality that it added passenger cars to Smyrna’s assembly lines. Gradually, American parts makers were allowed to bid on supply contracts. Even that came amid arm-twisting by Congress, which passed a law in 1992 requiring auto makers to inform consumers of the percentage of parts in United States-made cars that came from North America, Asia or elsewhere.
Calsonic Kansei of Tokyo opened its first plant in Tennessee in the mid-1980s, and now employs about 2,600 Americans making instrument panels, exhaust systems, and heating and cooling modules for Nissan. “The Japanese suppliers were encouraged to localize production,” said Matt Mulliniks, vice president for sales and marketing at Calsonic Kansei in Tennessee.
Nissan’s early doubts are reflected in recent debates over whether American workers can compete with overseas laborers. Within the technology industry, workers in Asia are viewed as hungrier and more willing to tolerate harsh work schedules to achieve productivity. The numbingly repetitive jobs of assembling cellphones and tablet computers, executives say, would be scorned here; they worry that many Americans would not make the sacrifices that success demands, and want too much vacation time and predictable work schedules.
In the auto industry, the belief that American workers could not match Japanese workers has long since faded. “A big part of the reluctance of Japanese automakers to come to the U.S. was the belief that their manufacturing systems could only work with loyal Japanese employees,” said Dr. Cohen, the American University professor. “Everybody was surprised how quickly the systems were adopted here.”
This year, Nissan held an internal competition to decide where to produce a new Infiniti-brand luxury sport utility vehicle. The plant in Smyrna was vying against one in Japan.
The surprising winner: Smyrna.
“All my life I’ve heard about how great luxury brands like Lexus and BMW are,” said Richard Soloman, a 20-year veteran at the Smyrna plant. “Now we will be building a vehicle of that standard right here in Tennessee.”
The Japanese presence has rippled through the South. But no place has benefited to the extent of Tennessee, which counts more than 60,000 jobs related to automobile and parts production. The state’s jobless rate, which exceeded the national average by a significant margin in 1983 when Nissan opened its plant, is now lower — 8.1 percent in June versus 8.2 percent nationwide.
Earlier this year, when Apple’s chief executive, Tim Cook, took the stage at a technology conference, he was asked if his company — which once made computers in America, but now locates most assembly in China and other countries — would ever build another product in the United States.
That day came recently for Brazil.
In Jundiaí, an hour’s drive from São Paulo, a strip of asphalt has recently been rechristened Avenida Steve Jobs, or Steve Jobs Avenue. Alongside is a factory where workers make iPhones and iPads. Brazil got these jobs through tactics the United States once used to persuade Nissan and other foreign carmakers to build plants in America: it cajoled Apple and Foxconn with a combination of financial incentives and import penalties.
Like the United States, Brazil is a big market — the third largest for computers after China and the United States. It has long imposed tariffs on imported technology products to encourage domestic manufacturing. Those fees mean that smartphones and laptops often cost consumers more in Brazil, and that domestic manufacturers can be at a disadvantage if their products require imported parts.
In April 2011, Brazil’s president, Dilma Rousseff, traveled to Asia with a pitch, much as Mr. Alexander did in 1979. The federal government would give Foxconn tax breaks, subsidized loans and special access through customs and lower tariffs for imported parts if it started assembling Apple products in Brazil, where Foxconn was already producing electronics for Dell, Sony and Hewlett-Packard.
Foxconn agreed. Within months, new Brazilian engineers were flying to China for training. By year’s end, Foxconn was making iPhones in Jundiaí, and it began making iPads there in early 2012, according to Evandro Oliveira Santos, director of the Jundiaí Metalworkers Union, whose members work at the plant. Stores now carry Apple products with the inscription “Fabricado no Brasil” — “Made in Brazil.”
Apple products remain expensive; the latest iPad, for instance, costs about $760 in Brazil, compared with $499 in the United States. But because those devices are made in Brazil and lower tariffs are charged on parts used to assemble them, Foxconn and Apple are pocketing larger shares of the profits, analysts say, offsetting the increased costs of building outside China.
Foxconn declined to discuss specific customers, but said that the Brazilian government’s incentive programs had influenced its decisions and that the company expected to generate more Brazilian jobs and aid the government’s goal of furthering the country’s technology industries.
Indeed, Brazil hopes that compelling Foxconn to assemble iPhones and iPads domestically will help set off a technology explosion. Ms. Rousseff has said that Foxconn could invest $12 billion more in Brazil. And as an electronics supply chain develops within the country, as it has in China, the expectation is that other manufacturers will build factories.
The government also hopes to use consumer electronics as a springboard for more advanced manufacturing. Targeting high-tech parts like computer displays and semiconductors could help Brazil reduce its trade deficit in these products and develop a robust homegrown industry, said Virgilio Almeida, information technology secretary at the Ministry of Science and Technology. “They are deemed high priority in the Brazilian industrial policy and are part of the Greater Brazil Plan,” he said. “Brazil has developed specific policies that grant incentives to foment research, development and industrial production.”
Throughout his term, Mr. Obama has regularly gathered advisers to discuss manufacturing, according to former high-ranking White House officials. As one meeting was breaking up, Mr. Obama casually tapped an aide’s iPhone to raise a point. Since the device is designed domestically, he said, it should be possible to make it in this country as well.
But it became clear at the meetings that there were differences of opinion over how best to bring manufacturing home, according to people familiar with the discussions who did not want to be named because the sessions were private. Everyone shared the same goal: establishing a level playing field and creating as many jobs in America as possible. But the debate centered, in part, on choosing among different tactics the American government has used in the past: penalties like tariffs against foreign countries that do not play by the rules or incentives like tax breaks to encourage more domestic manufacturing. On one side were officials like Ron Bloom, until earlier this year the president’s senior counselor for manufacturing policy, who favored more aggressive stances to counter policies used by Asian countries. He argued that the United States should fight China’s efforts to keep its currency weak. If China’s currency were stronger, American companies might find it costlier to make their goods in China and could have greater incentive to manufacture more in this country.
Interactive Graphic Evolution of a Manufacturing Supply Chain.Aligned on the other side at times were two powerful voices: Lawrence H. Summers, the top economic adviser to Mr. Obama until 2010, and Treasury Secretary Timothy F. Geithner. Along with many economists, Mr. Summers argued that an overly aggressive trade stance could hurt manufacturing — by, for instance, pushing up the price of imported steel used by carmakers — and over time, drive companies away.
Mr. Geithner thought diplomacy was more effective than confrontational tactics like labeling China a currency manipulator. “He told us, ‘It’s going to be a trade war if we go there,’ ” according to a person who attended the meetings. But this person countered that China would respond only to pressure. “What doesn’t work is the quiet stuff,” he said.
Mr. Summers, in a recent interview, declined to discuss his role at the White House. But speaking more broadly, he said that protectionist measures might incite new domestic manufacturing in the short run, but that it would come at a high price. “People will pay more for the product because it’s produced in a place that can’t make it at the lowest cost,” he said. “It burdens exporters because they pay more for their inputs. And it removes the spur of competition.”
A spokeswoman for Mr. Geithner said, “A multidimensional approach to tough yet smart engagement with China is the most effective way to level the playing field.” This strategy has had some success in persuading China to increase the value of its currency, she noted.
One of the president’s economic advisers also said that, despite some differences, Mr. Obama’s team, including Mr. Geithner and Mr. Summers, united to preserve manufacturing jobs in a critical area by bailing out the auto industry in the wake of the financial crisis.
But the divisions within the White House have often frustrated those who wanted a sharper focus on manufacturing. “The critics would say we didn’t really fight for manufacturing policy,” said another former high-ranking official who took part in many of those meetings and who did not want to be named because the discussions were confidential. “They have a strong point.”
Now, with unemployment high and a growing debate over outsourcing of jobs, manufacturing is on the political agenda. In March, Gene B. Sperling, director of the White House’s National Economic Council, outlined initiatives — including tax breaks for building factories here, infrastructure investments and going after “unfair trade practices” — to reinvigorate manufacturing. In May, the Commerce Department announced tariffs on Chinese solar panels for selling below fair-market value. The White House has challenged China’s trade practices on tires and rare-earth metals, and has established an “interagency trade enforcement center” to combat unfair trade.
Washington, however, has generally shied from addressing the protectionist measures of countries like China with countermeasures, as politicians once did against Japan.
After the Senate passed legislation last year imposing tariffs on nations whose currency is undervalued — a salvo aimed at China — the bill went nowhere in the House of Representatives, and the White House indicated it did not like the proposal.
However, champions of “in-sourcing” legislation — which takes away benefits from companies moving jobs abroad and provides incentives for those bringing jobs back — said the tenor of the debate was changing. “The public by and large has been betrayed by large American corporations that outsource. I think Congress is catching on to that,” said Senator Sherrod Brown, Democrat of Ohio.
Still, he does not advocate tariffs or quotas. Senator Debbie Stabenow, Democrat of Michigan, also favors tax breaks, rather than penalties. “I love my iPad,” she said. “And I want it made in America.”
One reason for the difference today: Unlike in the 1980s, when Japanese auto imports upset many voters, there has been little public outcry over imported cellphones and computers.
Back then, American workers were losing jobs as imports from Japanese companies cut into sales of the Big Three automakers.
But consumer electronics are different. Though some jobs have moved to Asia, many were never here to begin with. And the biggest technology importers — like Apple, Hewlett-Packard, Dell and Microsoft — are American companies.
Today, many consumers do not know or care where their smartphones are made. “Where it was built, what it means for politics, how it affects the economy,” said Raymond Stata, a founder of Analog Devices, one of the largest semiconductor manufacturers, “that’s not something people think about when they buy.”
(4/08/12, New York Times, by Raphael Winder)
Investigators on Friday continued to search for more explosives and other weapons possibly hidden by three men arrested this week and accused of having links to Al Qaeda and planning terrorist attacks. The suspects, Mohammed Adamov and Ahmad Avar, Russians of Chechen descent, and Cengiz Yalcin, a Turk, denied having any connection to Al Qaeda, said a person close to the investigation. A judge on Friday charged Mr. Yalcin with possession of explosives and ordered the other two detained for 48 hours for further investigation. Mr. Yalcin denied any knowledge of the explosives found in his home, said the newspaper El País.
(04/08/2012, New York Times; by Doreen Carvajal)
SEVILLE, Spain — Since its founding 127 years ago, the Fernández y Roche factory on the edge of this Andalusian capital has weathered every crisis known to hatters.
Despite the Spanish economic crisis, the Fernández y Roche factory is thriving, thanks to an unlikely revenue base: the sales of thousands of black hats each year to Satmar Hasidic Jews in Jerusalem and Brooklyn.
It surmounted the 1930s “hatless” trend that eschewed fedoras. It survived the sliding popularity of the birettas and saturnos worn by Roman Catholic priests. And, now, it is weathering a decline in Spanish sales of the most elemental symbol of Andalusia, the stiff-brimmed cordobés hat favored by horseback riders and the occasional bullfighter.
But despite the Spanish economic crisis, the hat company is thriving, thanks to an unlikely revenue base: the sales of thousands of black hats each year to Satmar Hasidic Jews in Jerusalem and Brooklyn.
“They are saving us in the crisis,” said Miguel García Gutiérrez, 35, the managing director of the Roche factory, officially known as Industrias Sombrereras Españolas, which operates in an industrial park in Salteras, about nine miles outside Seville. “We have an important market in Spain for traditional hats, but with the crisis those sales have fallen for the last three years, between 20 and 30 percent. But our exports are rising for hats for Orthodox Jews.”
The business is flourishing even though Andalusia’s unique artisans are suffering as demand falls in weak domestic markets. That includes everyone, from third generation artists who make “borlas” — the silken tassels that swing from elaborate religious floats — to families that embroider robes for statues of the Virgin Mary paraded through Seville during the city’s all-important Easter week activities.
The Satmars, one of the largest Hasidic sects with more than 150,000 members, left Hungary and Romania after World War II and settled in Williamsburg, Brooklyn, their main stronghold. There are also communities in Jerusalem and London.
The Spanish factory began supplying hats to the group’s enclaves in Brooklyn in 1980, after an American hat maker shut down and a Brooklyn store, Kova Quality Hatters, started looking for new manufacturers.
Today, the factory still produces traditional monteras for bullfighters, a stable niche market, and plumed, dress military hats made from a collection of more than 2,000 wooden molds. But its growth industry is the basic black felt hat, selling more than 12,500 of them a year — largely purchased by the growing Satmar sect. More than 70 percent of all their hats are exported to the United States, England, Japan, Belgium and Israel.
The hats for the Orthodox Jewish market are not listed in any catalog or Web site. The three popular models make distinctive fashion statements summed up by their names: Bent Up, Snap Brim and the Clergy, which lacks a crease in the crown and is bound around the brim.
“It may seem like they are all very similar black hats, but actually this group has its own fashions,” Mr. García said. “Styles are constantly evolving with a crown that is higher or lower or a brim that is wider or narrower.”
Those barely perceptible differences in plain black hats are important markers, according to Ester Muchawsky-Schnapper, the curator of a popular exhibit that is drawing 800 people a day at the Israel Museum in Jerusalem on the lives and customs of Hasidic Jews, including the Satmar sect and their hats.
Some groups wear hats with satin ribbons around the crown that fold into a bow on the right side while others wear it on the left, said Ms. Muchawsky-Schnapper, adding that these differences reflect the choices of the groups’ leaders and members. Brims are a decisive feature.
“You can differentiate the different groups by their hats,” she said, noting that another Hasidic sect, the Lubavitchers, draws meaning from a triangle-shaped crease at the crown, which signifies “wisdom, knowledge and understanding.” The Satmars in Jerusalem wear a very flat hat of rabbit hair, which is more velvety than the Satmar hats in New York, she said.
In the Borough Park neighborhood of Brooklyn, Albert Ehrman is the second generation in his family to run the half-century-old Kova Quality Hatters from a brick storefront. He travels each year to southern Spain with his wife, Miriam, to personally inspect the Clergy hats, the most popular with his Satmar clients.
4 ago. 2012
(Wall Street Journal, 04/08/2012; by Bruce Orwall)
LONDON—Oscar Pistorius was already a full-blown sensation when he stepped onto the Olympic Stadium track on Saturday, backed by an adoring crowd and a package of endorsements that would be the envy of any track star here not named Usain Bolt.
Then the South African star not only became the first double-amputee to compete in the Olympics; he asserted his place there by qualifying for the men's 400-meter semifinals on Sunday.
Pistorius, who runs on L-shaped carbon blades, finished second in his heat with a time of 45.44 seconds. That was 16th-best overall in qualifying heats, in which Belgium's Jonathan Borlee posted the best mark of 44.43 seconds.
"I found myself smiling in the starting blocks, which is rare in the 400-meter," Pistorius said. The Blade Runner, as he's known, described coming onto the track and seeing his 89-year-old grandmother in the stands. He realized he might have the crowd behind him when he heard someone shout from the stands: "You sexy baby!"
"I've still got goose bumps and my race was an hour ago," Pistorius said. And indeed, after his sprint, he took an hour-long lap through the press line while other athletes either breezed by unnoticed or stopped to answer questions about…Oscar Pistorius.
"It takes a lot of courage and confidence to do what he's doing," said Grenada's Kirani James. The other athletes seemed eager to treat Pistorius as an equal, not an oddity. "I just see him as another athlete and another competitor."
Pistorius's success Saturday will likely also extend the debate over whether his high-tech blades actually provide some sort of advantage. The few who addressed it on Saturday weren't taking the bait, however.
."I think it is fair," said Tony McQuay of the U.S., whose time in another heat was just behind Pistorius's at 45.48. "It's not like he broke the world record the first time he stepped on the track. He's working hard like everyone else."
While the other 400-meter runners came and went quickly, a beaming Pistorius cheerily gave a detailed account of his pre-race activities and described every meter of his race, which he said was his second best of the season.
"My coaching staff has done a good job to let me peak at the right time," he said.
Pistorius, who already had Nike and Oakley endorsements among others, appears headed to being one of the biggest stories on the track over the next week, and his advance to the semifinals will likely bring an even bigger spotlight on Sunday.
Even as he moved through making history in the able-bodied Olympics, Pistorius made sure he gave a shout-out to his roots in events for the disabled. "My first Paralympics," he said, "was one the highlights of my career."