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Prices determine how resources are to be used. They are also the means by which products and services that are in limited supply are rationed among buyers.
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The price system of the United States is a complex network composed of the prices of all the products bought and sold in the economy as well as those of a myriad of services, including labor, professional, transportation, and public-utility services. The interrelationships of all these prices make up the “system” of prices. The price of any particular product or service is linked to a broad, complicated system of prices in which everything seems to depend more or less upon everything else.
If one were to ask a group of randomly selected individuals to define “price”, many would reply that price is an amount of money paid by the buyer to the seller of a product or service or, in other words that price is the money values of a product or service as agreed upon in a market transaction. This definition is, of course, valid as far as it goes. For a complete understanding of a price in any particular transaction, much more than the amount of money involved must be known. Both the buyer and the seller should be familiar with not only the money amount, but with the amount and quality of the product or service to be exchanged, the time and place at which the exchange will take place and payment will be made, the form of money to be used, the credit terms and discounts that apply to the transaction, guarantees on the product or service, delivery terms, return privileges, and other factors. In other words, both buyer and seller should be fully aware of all the factors that comprise the total “package” being exchanged for the asked-for amount of money in order that they may evaluate a given price.
Science & Technology
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A pinch too much
Salt is set to be the next trans-fat
WITH so much emphasis on health care during the current presidential campaign, whoeverwins next Tuesday’s election will need to make some speedy decisions about the runawaymedical costs occasioned by America’s unhealthy eating habits.
Salt will likely be first in the crosshairs. Pressure has been building for the sodium found mainlyin table salt—currently an unrestricted substance “generally reckoned to be safe”—to beregulated as an “additive” subject to legal limits.
Physicians have long linked salt to high blood pressure—a key factor in heart disease andstroke. A 20-year study investigating the role sodium plays in people developing high bloodpressure was finally released to the public in 2002. It concluded that a high-sodium diet is adefinite risk factor for congestive heart failure in overweight people.
Death in a shaker?
The food industry argues the results are far from conclusive. Meanwhile, salt manufacturershave seized on studies that suggest the real culprit is not sodium but obesity.
And if sodium does contribute to high blood pressure in any way, they say, it only affectspeople who are susceptible to it in the first place; it’s not automatically a problem foreveryone.
That’s true. Indeed, studies done at Indiana University suggest only a quarter of Americanswith normal blood pressure and little over half those with hypertension (persistently highblood pressure) are salt-sensitive—and therefore potential candidates for cardiovasculardisease, stroke or even stomach cancer.
But the trouble with such an argument is that there’s no sure way of knowing whether you aresensitive to salt, and might subsequently develop high blood pressure as a result of a high-sodium diet. Better to be safe than sorry, says the American Medical Association (AMA).
Doctors compare two numbers when measuring the pressure of a person’s blood as it coursesthrough the arteries, veins and smaller blood vessels. One is the peak (systolic) pressure in thearteries at the beginning of a cardiac cycle when the heart’s ventricles are contracting. The otheris the minimum (diastolic) pressure at the end of the heat beat when the ventricles are filledwith blood. By tradition, the pressure is measured in millimetres of mercury.
A typical healthy adult has a blood pressure of 115mm systolic and 75mm diastolic (referredto as 115/75). Anyone with a blood pressure that’s consistently higher than 140/90 hashypertension. Anything in between is classified as pre-hypertension.
Today, 65m Americans suffer from hypertension, and 59m more have pre-hypertension. Inother words, over 40% of the population is at risk. Halving the amount of salt in the diet, saysthe AMA, would save 150,000 lives annually in the United States alone. That’s five times morethan the number of people killed on the road each year.
But unlike trans-fat, removing salt from the diet altogether would be most unwise. Sodium isone of the body’s four essential electrolytes (along with potassium, calcium and magnesium).It helps maintain the right balance of fluids in the body, and allows the brain to transmitmessages and the muscles to contract and relax.
But if your kidneys can’t regulate the amount of sodium in the body properly, it builds up inthe blood. Because sodium attracts and stores water, the volume of blood then increases. Thatputs extra pressure on the heart and the arteries. And if the omens are against you, the resultis cardiovascular disease.
No matter how you look at the data, there’s no question Americans consume way too muchsodium. With a few exceptions, most people need no more than 0.5 grams a day—and seriouslyshouldn’t take more than 2.3 grams (the amount of sodium in a teaspoon of salt). If you’reblack, middle-aged or older, or have high blood pressure, chronic kidney disease or diabetes,you should restrict your daily intake to 1.5 grams at most.
Yet, with a pinch here and a dash there—plus dollops of the stuff in processed food andrestaurant fare—most of us unwittingly ingest between 3 and 4 grams of sodium every day,with some determined folk racking up 20 grams or more.
The trouble is that salt makes food tasty. Because we need it to survive, we seem to begenetically programmed to like it. Taste tests show people from all cultures, even those thathave low-salt diets, opt for saltier items when given the choice.
No wonder salt is used to flavour or preserve so many of our favourite dishes—from potatochips and snacks to fish, meat, dairy products, canned vegetables, pickles and bread. A singlebagel or a slice of pizza will supply the body with all the sodium it needs for a day. A frozen TVdinner or a meal from a fast-food joint will dose you with ten times the necessary amount.
Losing the taste for salt is difficult, but not impossible. In Britain, for instance, where theaverage person used to consume 4 grams of sodium daily, the government has pressuredfood manufacturers into lowering the salt content in some 85 categories of processed foods.Already progress is being made in reducing the population’s daily intake to no more than 1.6grams.
The Finns have been at it longer, and chalked up even greater success. Over the past 30 years,they’ve lowered the amount of salt in their diet by 30%. In the process, Finland has seen a10mm drop in blood pressure nationwide, and a 75% reduction in cardiovascular disease inpeople under 65 years of age, plus a six-year increase in life expectancy.
As in Britain, success has come from clever media campaigns aimed at fostering better eatinghabits, plus labeling laws that force food manufacturers to mark their products “high in sodium”if they exceed certain levels.
Could something similar happen in America? Certainly, and it probably wouldn’t take 30 years.Stopping people smoking in public was a far bigger challenge.
The measures changed national habits within a decade—though it took legislation to make ithappen, initially as city ordinances and later as state-wide initiatives.
Interestingly, New York City—which was among the first to ban smoking in restaurants andbars, and the first to pass laws targeting unhealthy eating habits—isn’t waiting for a newadministration in Washington, DC to place salt on some national hit list.
By all accounts, New York is preparing to add permissible sodium levels to its recent ban onartificial trans-fats and its requirement for calorie counts to be listed on the menus inrestaurant chains. Absent some national initiative, San Francisco, Los Angeles and Seattlewon’t be far behind.
One way or another, the betting is that by this time next year salt will be the new trans-fat.And manufacturers will be vying with one another to provide the lowest figure in the land.
The Cuban revolution at 50
Heroic myth and prosaic failure
Dec 30th 2008
From The Economist print edition
All the Castro brothers have to celebrate this week is survival. But that in itself is aremarkable achievement
IN THE early hours of January 1st 1959, as New Year parties were in full swing in an otherwiseunnaturally quiet Havana, Fulgencio Batista stole away. He flew from Camp Columbia, the city’smain military base, to exile in the Dominican Republic with an entourage of relatives andcronies. The dictator’s flight meant that just 25 months after landing with 81 men, all but adozen of whom were immediately killed or captured, Fidel Castro, a lawyer and former studentleader, had led his guerrilla force to an improbable triumph against Batista’s American-backedarmy. The next day Mr Castro spoke to a jubilant multitude, many dressed in the red and blackcolours of his July 26th Movement, in the main square of Santiago de Cuba, the island’s secondcity. “The revolution begins now,” he proclaimed, adding: “This time, luckily for Cuba, therevolution will truly come into being. It will not be like 1895, when the North Americans cameand took over…For the first time the republic will really be entirely free.”
As they descended from the mountains of the Sierra Maestra and entered Santiago, thecolumns of bearded rebels “were literally swept off their feet by the overjoyed people”, as one ofthem, Carlos Franqui, recorded in his diary. “It was the hour of freedom after a long tyrannyand a very tough fight.” Such scenes were repeated across the island as Mr Castro embarkedon a week-long triumphal march to Havana. They were echoed in the rest of Latin America, andbeyond it. The dictatorship of Batista, a former army sergeant, had become notorious for itscorrupt brutality. To many people, Mr Castro and his similarly handsome lieutenants, includingErnesto “Che” Guevara, an Argentine doctor, seemed to be romantic heroes. To others, theyrepresented a renewal of socialism. Jean-Paul Sartre hailed Mr Castro’s revolution as “themost original I have known”.
Just as he had pledged, Mr Castro prevented the Americans from derailing his victory. But hedid so at the cost of the freedom he had promised. Less than two years after his speech inSantiago—and before the United States imposed its economic embargo against the island—hehad taken decisive steps to turn Cuba into the first, and still the only, communist country inthe Americas.
Half a century on, the euphoria is long gone. Everyday life in Cuba is a dreary affair of queuesand shortages, even if nobody starves and violent crime is rare. It is the only country in theAmericas whose government denies its citizens freedom of expression and assembly. Cuba’sjails contain 58 “prisoners of conscience” detained purely for their beliefs, according toAmnesty International, a human-rights group. But to the chagrin of the United States, and indefiance of its futile embargo, Mr Castro and Cuban communism stubbornly cling on just90 miles (145km) across the Florida Straits. He and it have outlasted the fall of the Berlin Walland the collapse of his Soviet patron, and lived to see new allies emerge in Latin America andelsewhere.
Fidel himself has not appeared in public since he underwent abdominal surgery in July 2006.But his views, expressed in a column entitled “Reflections of the Commander” that ispublished every few days in the state newspapers, still dominate Cuba. His slightly youngerbrother Raúl, who succeeded him as president last February, may be more pragmatic and moreopen to capitalism (though not to liberal democracy). But Raúl’s plans for economic reform,already cautious, have been further stalled by two devastating hurricanes that hit Cuba thisyear (see article). What will be officially celebrated in Havana this week is not the prospect ofchange. It is the stubborn survival of a revolution that has had profound consequences forthe Americas—though rarely those that Mr Castro wanted.
Outwitting the CIA
On the face of things, Cuba was an unlikely candidate for communism. The largest island inthe Caribbean, it was also the wealthiest, thanks to sugar. Its insular status had allowed Spainto hold on to its “ever-faithful isle” for seven decades after it lost its colonies on the Americanmainland. As Mr Castro noted in his victory speech, a long struggle for independence washijacked when the United States intervened: the Spanish-American war of 1898 marked the endof Spain’s presence in the Americas and turned Cuba into an American neo-colony. Some60% of farmland and much of the sugar industry came to be owned by Americans. A third ofthe workforce, most of them black rural labourers, lived in severe poverty.
Nevertheless, in 1958 Cuba was among the five most developed countries in Latin America: lifeexpectancy was close to that in the United States, and there were more doctors per head thanin Britain or France. Although Havana had its darker side as a mafia bolthole, it was also aglittering cultural and commercial centre. It is the music from that era—the son, revived underthe label of the Buena Vista Social Club—that has once again in recent years got the worldsinging and dancing, rather than the nueva trova (“new song”) of the revolution. As Bertrandde la Grange and Maite Rico note in the latest issue of Letras Libres, a Mexican magazine,Havana boasted 135 cinemas in 1958—more than New York City. Today only a score remainopen, although the city’s population has doubled.
As Rafael Rojas, a Cuban historian who lives in exile in Mexico, has pointed out, most Cubanswanted and expected Mr Castro to restore the democratic constitution of 1940, repudiatedby Batista’s coup of 1952. That, after all, was what he had promised in the manifesto of theJuly 26th Movement, along with agrarian reform. and the nationalisation of the American-owned public utilities (though not of the rest of the economy). But Mr Castro had other ideas.He was determined that his revolution should not suffer the fate of Jacobo Arbenz, ademocratic social reformer in Guatemala, who was overthrown by an invasion misguidedlyorganised by the Eisenhower administration in 1954 in the name of anti-communism. Guevarahad witnessed that event, and learned from it.
Guatemala was the first skirmish of the cold war in Latin America. But it was the Cubanrevolution that turned the region into an important theatre in that ideological and militaryconflict. Installing moderate civilian politicians in government, Mr Castro named himself headof the armed forces. He quickly dismantled Batista’s army. Some 550 people more or lessclosely linked to Batista’s regime were executed after show trials, a bloodbath in which Guevaraplayed a particularly prominent role. Mr Castro deepened his alliance with the Popular SocialistParty (as Cuba’s old-established communist party called itself), and set up a parallelgovernment at a newly created National Agrarian Reform. Institute headed by Guevara. Withinseven months of victory he had shelved his promise of elections. The July 26th Movementsplintered, with many of its non-communists (including Mr Franqui) going into exile, jail orquiet opposition. In October 1959, just nine months after entering Havana, Mr Castro beganthe contacts with the Soviet Union that swiftly led to a full-scale economic and militaryalliance.
The CIA quickly concluded that Mr Castro was a closet communist and set out to overthrowhim. But it was not until October 1960 that the United States began to impose the embargo.By the time a CIA-organised invasion of anti-Castro Cubans landed at the Bay of Pigs in April1961, Mr Castro was ready for them, as Arbenz had not been in Guatemala. In 1962 the SovietUnion’s decision to station missiles on Cuban soil brought the world the closest it has evercome to nuclear war. In return for their withdrawal, the Kennedy administration guaranteedthat it would not again invade Cuba. Mr Castro had consolidated his victory. His triumph wouldprompt an exodus of hundreds of thousands of the more entrepreneurial Cubans. It thushad the unintended effect of turning Miami from a sleepy beach town into a throbbing regionalentrepôt.
Communism, Cuban-style
Precisely when Mr Castro became a communist is a matter of conjecture (though Raúl was amember of the Communist Youth and Guevara’s experience in Guatemala strengthened hisprevious embrace of Marxism). The evidence suggests that Mr Castro imposed communismin Cuba of his own volition, not in reaction to American hostility. Certainly that hostility(which included endless CIA attempts to kill him) made his task easier. But it was not inevitablethat the Cuban revolution should become a communist one. Mexico’s revolution earlier in the20th century installed a nationalist but non-communist regime. In Venezuela in 1959 apopular uprising against a dictatorship led to a democracy under Rómulo Betancourt, asocial-democrat, though this would be corroded by the collapse in the price of oil in the 1980sand 1990s.
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