[World's most expensive soup] 'Monk Jumps Over the Wall' US$44billion: Buffett to Gates: Spend It!

I took my article from http://www.spiritof.info/giving/articles/time/giving.time.story2.html

The costly question: “Should foundations focus on perpetuating their resources or spending them?”

It is reported in the latest Berkshire annual report that Warren Buffet states strict rules concerning the spending of his shares that will go to charity after his death. After the closing of his estate, he wishes that every dollar of his gifts must be used within ten years. For readers who still do not know what Warren Buffet has done, I would like to reiterate that he stunned the business world when he publicly announced that he would donate $44 billion of his Berkshire Hathaway fortune to charity. Imagine using up $44 billion within ten years. And this is $44 billion in US mind you. This is equivalent to buying 30,137 PS3’s DAILY FOR TEN YEARS! Charities are now put in a spot because Buffett’s endorsement is a landmark moment in philanthropy.

Charities rarely exceed the minimum spending ratio of 5% of their entire organization’s asset value because they operate with the intent of lasting forever. Buffet’s new condition has disrupted the plans of many foundations due to this “time-limit” factor. On the good side, this “spend-down model” will provide donors with a greater control over how their money is spent. This will ensure that money is put into good use and spent promptly because “as organizations grow over time, the risk of bureaucracy and mission drift grows”.

I feel that this “spend-down model” is quite an effective method in ensuring that money is used wisely because it forces foundations to plan out the use of money without letting funds drift around aimlessly. If funds are kept loosely without a predetermined agenda, charities run the risk of misusing funds.

I would like to bring up the example of NKF’s misuse of funds. NKF had been telling Singaporeans that its reserves of S$262 million (as of June 2005) would not last more than three years. However, even if NKF had stopped fundraising all together, it would still have enough funds to see through its operations for 30 years. NKF had underutilized its funds by spending far less on dialysis than the public had been led to believe. This perfect example clearly shows that a “spend-down model” is effective in ensuring that money is promptly put into good use to ensure that funds do not get wasted on other things like pay rises.

However perfect this model may seem, it does have its downside too- wild spending. In a bid to use up the funds, organizations tend to spend extravagantly and unwisely, which often results in wastage of funds too. A good and balanced management is essential for wise usage of funds.

So be it US$44 billion or 1 rupiah, be it the “spend-down” model or the “safe-up” method, do your part to help the less fortunate to make OUR world a better place.

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Canned soup "MADE IN CHINA": China declares 'war' on tainted products

I took my article from http://edition.cnn.com/2007/WORLD/asiapcf/08/24/china.safety.reut/index.html

My response:

Made in China

The sticker on your microwave oven says ‘Made in China’. The tag on your pair of basketball shoes says ‘Made in China’. Even the words printed on your toothpaste say ‘Made in China’. These three words appear on virtually anything you use, wear, eat and own. The only thing in your entire house that probably does not have ‘Made in China’ printed all over it is your birth certificate. However, the connotations of such a label are not positive. Words like ‘inferior’, ‘cheap’ and ‘mass-produced’ are qualities that are attached to this label. Pushing quality aside, words like ‘hazardous’, ‘toxic’ and ‘unsafe’ now add on to the list of negative characteristics. People are now paranoid that these products will take their lives. So why do consumers have bad impressions on China products?

China’s product scares have hit the world’s panic button. Consumers’ worries are not unfounded. Millions of China-made toys were deemed hazardous due to use of improper lead paint and small parts that could be easily swallowed. Cough medicine containing deadly chemicals killed dozens of patients in Panama. Toxic toothpastes containing dangerous levels of diethylene glycol (DEG) were circulated all over the world. The list of examples doesn’t just end there. I have even read an article recently this year about cardboard being used in char siew baos as 60% of the filling. Unscrupulous vendors saved about US$132 a day by using this method due to rising pork prices from a supply shortage.

China is already trying to salvage their battered image by trying to stamp down on products that have dented consumers’ confidence. Chinese Vice Premier Wu Yi has launched a four-month “war” on tainted food, drugs and exports in an attempt to “protect the health and personal interests of the public and to protect the reputation of Chinese goods and the national image” by using “an autocratic, top-down approach using campaigning methods”. It will probably require another few more years before people can safely buy Chinese products without having to examine the ingredients.

I personally think the problem lies within the producers’ ethics. This drop in quality has come about due to poor production conditions, low quality standards, weak reliability and unscrupulous business management. All these problems are a result of poor moral ethics. This problem does not just lie with China’s products but applies to exporters all over the world. Quality is plummeting as companies seek only to earn back the most from giving as little as possible because everyone is only focused on economic-growth targets. I shudder to think of the implications if this problem carries on, especially when more than half of the products we use are ‘made in China’. Safety has overtaken quality to become the underlying consideration for consumers. How can we work on saving the world from environmental problems if we cannot even save ourselves from brushing our teeth with toxic toothpaste?

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