Another "Suicide" in London

Several high-profile Egyptians have committed suicide in London by throwing themselves from the balcony. One have to wonder is this a coincidence or as Hisham Talat Mostafa said: "kill her the same way Soaad Hosni was killed in London."

So, I started to analyze it statistically to understand what is going on.

First of all, the suicide rate in the UK is 17.5 per 100,000 per year. Egypt for sure is expected to a lower suicide rate. However, let us assume that Egyptians in the UK adopt the British life style and have similar suicide tendencies.

According to Al-Ahram weekly, there are 75,000 Egyptians living there. http://weekly.ahram.org.eg/2005/747/eg4.htm

“In the UK, meanwhile, where 75,000 permanent and temporary Egyptian immigrants live, a movement called the "Save Egypt Front" was launched in late April. With membership culled from Europe-based Egyptian expatriates, the movement calls for comprehensive political and constitutional reform in Egypt.”

If we assume that out of those 75,000 Egyptians in the UK there are 1 in 1000 who are celebrities, which is a high percentage but acceptable given that many celebrities will prefer to live in London that means there are 75 Egyptian celebrities living in the UK.

That means the average probability of suicide by those celebrity Egyptians is 75*17.5/1000 = 0.013 per year. Over the span of 20 years there should be 0.26 suicide cases. We have a surprisingly 3 cases in the span of 20 years. The probability of that to be a random event is 0.0023 or 0.23%. If we consider that all 3 cases were in the same building with the same suicide method, then the probability of all 3 being suicide is less than 0.23%.

To get more accurate, if we assume that a 3rd of the suicide in the UK are by jumping off buildings (which would be a very high and unlikely assumption given it is not a comfortable method of death). Then, the expected rate will be 0.0004 per year, or <0.1 over the span of 20 years. This translates to a probability of suicide of 0.015%. This is a very low probability to be reasonably considered.

That leaves 2 options:
1- Either all of these Egyptians neglected safety one way or the other.
2- That building lacked adequate safety measures.
3- There is something fishy going on.

It is hard to believe that the building lacked adequate safety measures because otherwise nationalities other than Egyptian would have died too and that was not the case.

It is also hard to believe that 3 high-level celebrities some of them are ex military or billionaire who lived in the UK for a long time ignored safety that much. Besides, what kind of safety ignoring that leads to someone falling off the window? In Egypt with all of its notorious lack of safety this doesn’t even happen.

This leaves one and only reasonable conclusion. There is something fishy going on. The odds are just to high. The probability of something fishy going on is at least 99.2% or more like 99.98%. This is to high. It really does need a robust investigation.

Predicting Winner in the Next US Elections

Who Will Win?

Can we make predictions of the next elections? The answer is probably. Ray Fair (Yale University Professor) studied all previous US elections and arrived at the following model for predicting elections:

V = 0.468 –0.34 I + 0.047 I.d + 0.0065 g3 . I – 0.0083 p15 . I. (1 – d) + 0.0099 n . I. (1 – d) + 0.052 depr – 0.024 dur

Variables are defined as follow:

V = democratic share of the two party vote
I = 1 if democrats are in white house, -1 if republicans are
depr = 1 if president himself is running and is democrat, -1 if republican and 0 otherwise
p15 = average inflation over the past 15 quarters
g3 = growth rates of per capita real GDP in the past 3 quarters before the elections (i.e., corrected for US population growth)
n = number of quarters of the first 15 quartes of each period of a presidential administration in which growth rate is greater than 2.9%
DUR = 0 if the incumbent party has been in power for one or two consecutive terms, 1 if the democrats have been in power for 3 terms and –1 if republicans.
d = 1 if it is a war year and 0 otherwise

The equation has a correlation coefficienct of 96%and has a standard error or 1.9%, which means it is quite accurate.

Let us now try to apply it for the 2008 elections.

I = -1 since republicans are in white house
G3 = ¾ * (average growth rate over past 3 quarters % – 1.0) = 0.37, where 1.0% is the approximate annual growth rate of population in the United States, and correction by ¾ because we only need growth over 3 quarters and not annualized.
(obtained from http://www.economagic.com/em-cgi/data.exe/var/rgdp-qtrchg and assuming 3rd quarter to be average of previous 3 quarters)

n = 2-3, there are only 2-3 quarters in the past 15 quarters with good news.

Finally, inflation data are obtained from: http://data.bls.gov/PDQ/servlet/SurveyOutputServlet?data_tool=latest_numbers&series_id=WPSSOP3000&output_view=pct_1mth


p15 = approximately = 12.5%


The results are telling us that in case d = 1, democrats get 45%. In case d = 0, democrats get 58%. Therefore, if US public perceives they are in time of war, democrats lose and in case they focus on economy, then democrats will win in a landslide.

The table above tells us that all the economic factors combined can be neutralized by the war effect. It by itself has about 14% of leverage for the Republicans.

Sensitivity analysis shows that if economy turns real bad, the democrats can win up to 63.8% assuming the US population discounts the war effect. If the economy becomes great, the democrats will still win 52% still assuming the war effect is discounted. If the war effect is not discounted, then democrats get only 44% assuming economy turns better or get 46% assuming the economy turns worse.

The only contour for the Democrats to win is to neutralize the war effect and amplify the economic issues. Otherwise, they barely win. The reason the 52% contour was selected to demarcate a democratic win is because it represents 50% + margin of error. So, at 52% democrats win barely.

Conclusions:

1- According to current predictions, Democrats should win about 52% of popular vote on average, with a standard error of about 1.9%. Therefore, democrats can win by a narrow margin or it will be in a reality a toss-up given the margin of error of about 2%. Therefore on average both parties have have to adopt a very local strategy to capture the electoral college vote.

2- If the economy continues to turn even more south, democrats can win by a landslide up to 62%.

3- Portraying the economy in better shape doesn’t help the Republicans much. It gives them only a minor advantage and makes it still more local game and still becomes a contested election. Also, it will be very hard for republicans to turn the economy or even portray it in a positive light. This explains why the republican strategy in the convention ignored the economy completely. It just is not a good lever for them at all. They skirmished around it with things like America has largest and most prosperous economy in the world. Talk of better economy just manages the disaster for them so instead of a landslide it becomes a narrow loss or bring it back to being contested.

4- The biggest lever republicans have is the war. If they successfully focus on it they can bring significant advantage and neutralize the democrats. The strategy becomes simple for republicans: bring someone attractive (Sara Palin) to energize the message and hammer home that it is country in war with slogans like: “country first”. The strategy is working so far as evident by the jump in the polls. McCain can talk economy for ever and it won't really make a difference.

5- Democrats strategy has to focus on the poor economy and how they will fix it. This moves them to have a landslide. There is no easy strategy for them on war simply because Americans like victory and anytime republicans will show they are better positioned for Victory they can win (although narrowly). It will not matter who brought us to this position. The party that will show it can bring victory with no surrender will win. This is why “the economy stupid” is better strategy for democrats and then can say that a better economy will enable the US to win abroad. Democrats have to level with Americans on this point and clearly indicate they want to win and will find the best strategy to win and that past Pickering was just that pickering, and that republicans made mistakes but we are where we are and have to devise a strategy to win and not cut and lose.

Mediterranean Union

What are the geostrategic reasons for the Mediterranean union?

There are several:

1- The Middle East region sees a significant power vacuum. There is no dominant power or a balance of power in this very vital part of the world. Israel is strategically at its limit as demonstrated in Lebanon. The United States is hemorrhaging in Iraq and is deeply unpopular in the region. Iran is strengthening and has made significant steps forward in the region but it is too far for most of the region centers of population and is viewed with suspicion in the ruling quarters. There is security system in the region as Paxa Americana is facing too many troubles. Because of its location and wealth, Middle East is an area that cannot have power vacuum.
2- There is an ideological vacuum in the region as well. Arab nationalism has failed. Western liberalism is failing against a strong Islamic current. The Islamic current is facing difficulties. Not the least of which is the association with terrorism. There is strong lack of guiding principles in the region. This may have been ok if Arab governments were able to provide strong economies to support the population growth but this is failing miserably. Leading to boat migration at the European shores that has increased significantly in the past year. This is alarming to Europe given their demographic situation.
3- The region has many financial and economical opportunities. It is amazing that every time the oil price increases, Europe tries to increase its ties to the Middle East. In 1980, Spain floated the idea of a bridge across the Mediterranean. The idea was killed of course when oil prices collapsed and Europe wanted instead to build a wall instead of a bridge. With oil prices at $150/barrel, there are many projects that European companies can do in the region under the umbrella of a Mediterranean Union.
4- Energy security: with Russia tightening the grip on Europe’s energy supply and the Gulf region liable to enter a long period of instability, Europe needs to find its own renewable energy source. The most important underpinning of the Mediterranean union is a project in which solar thermal energy will be produced on the Southern shores of the Mediterranean where the sun is abundant and land is cheap (solar energy requires lots of land unlike wind) and then the produced electricity is transported to the North via large cables. The Mediterranean union cannot be political, it can only be economical with energy as its underpinning. This enables Europe to get access to renewable energy that is more secure than oil or gas from Russia or from the Gulf. The only way for President Sarkozy to convince Germany not to obstruct his grand union idea is to promise that (a) German companies will participate in the action and (b) Germany will gain access to the resulting energy.
5- Europe fears the vacuum in the Middle East and Africa if not filled by Islamic radicalism will provide an opportunity for Russia or China to penetrate. Russia is already making deals with Libya to control Libyan gas production. Even stranger, Chinese students are in the streets of Cairo selling Chinese products. This can all be prelude to either one of these powers attempting to fill in the vacuum. Therefore, Europe had to respond.
6- Finally, there is the goal of attracting Syria, Lebanon, and the Palestinians away from Iran so that Iran can be slowly strangled far away from the vital Mediterranean. Iran has gained a bridgehead in the Mediterranean that Europe considers destabilizing and dangerous. With Israel unable to contain that bridgehead, Europe had to step in.
7- France as always has grand visions for re-creating its empire. Especially in its North African sphere of influence This time it is through energy.

Therefore, Europe and France need the following:
1- Energy arrangements, particularly renewable energy.
2- Access to markets, particularly for European companies in oil and gas activities or in selling engineering products.
3- Security cooperation.

Now, let us look at who was absent and why:

1- King Mohamed VI of Morocco: His father had a famous advice for him: “comme ci, comme ca.” This is a repeat of the past and based on that advice, the King expects that Europe will turn its face elsewhere once the short-term goals are achieved. He is the one who saw the collapse of the Africa-Europe tunnel and the bridge and all other linkage projects. He probably knows better of the French intentions through his own connections there, which are famously strong and influential. He also has a bitter taste from how Spain treated him in the past when invading tiny islands off the Moroccan coast despite strong relationships between the two kingdoms.

2- King Abdullah II of Jordan: Interesting enough, he is the only other Arab king invited. Both kings declined the invitation. In the Middle East and the Fertile Crescent region, Jordan is strategic. In the Mediterranean security arrangement, Jordan is a non-entity. Jordan’s role shines when Iraq and Saudi Arabia are in the picture. Otherwise, it only has a secondary role. Most likely the Jordanian King listened to the Moroccan King and stayed home. It is also likely that in absence of any guidance from Washington (which is pre-occupied with Iraq and elections), the King preferred to be on the fence. Finally on the personal level, the King's uncle Al-Hasan Bin Talal was instrumental in the Union idea. As a president of the Club of Rome, Al-Hasan addressed the world energy dialog in April 2006 saying: "The sun belt and the technology belt can become very powerful when they begin to understand themselves as a community, a community of energy, water, and climate security." As is known, Abudllah II has deep issues with his uncle since the messy death of King Hussein Bin Talal.

3- Mommar Gaddafi of Libya: The erratic leader has a natural distaste for European influence and prefers to play on a bigger scale with Russians, Africans, and Americans.

Sarkozy's gamble is bold for sure but it may be crazy enough that it will work! Reasons are:

1- European companies really need the energy and at today's prices, projects across the shore may be economical.

2- Populations in the Middle East need something to attract them and this may be the something.

3- Energy security is a big issue for Europe and it needs a solution.

4- Public opinion in France is very supportive as long as it keeps Arab immigrants away.

So, for now the odds are favorable. Don't underestimate the guy (Sarkozy). He is smart.

Economics of the Union

For all my Arab brothers and sisters, Europe has studied the concept since 2005 and studied it very seriously. The underpinning is to general solar-thermal power in North Africa and transmit power to the North via high voltage DC links.

Results of the study shows that by 2020, Europe can import 10 GW of electricity from North Africa, which requires the establishment of about 100 plants each of 100 MW, which is quite doable in the next 12 years. The cost of electricity delivered to Europe will be about 21 cents/kWhr. This compares to about 12 cents/kWhr now from electricity produced using natural gas. However, if we add the carbon taxes associated with natural gas or any other fossil fuel burning, the cost of natural gas generated electricity leaps to about 18 cents/kWhr. The insecurity associated with importing natural gas from Russia is certainly worth more than the 21 - 18 = 3 cents/kWhr difference between the two options.

For companies operating the solar thermal production and transmission systems, they will have to invest about 75 billion dollar and get a return of about 5 billions per year. This is a return of 15 years. This is certainly long return of 6.7% per year. However, this is better than the European bank interest rates in today's low interest rate environment. The European bank can provide loan guarantees to finance these mega projects (this is where Germany's role becomes critical). The investment of 75 billion over 12 years is also not that much for the European Union.

These investments cannot be made in Europe for very simple reasons:

1- Solar capacity factor (temperature and how many hours the sun shines) is at least 25% higher in North Africa than in Europe particularly in Winter when demand for heat is high. Natural gas avoided to be burnt for electricity can be utilized for heat with a cooling effect on the price of natural gas in Europe.

2- Solar plants consume plenty of land. Land in North Africa is at least 50% less expensive than land in Europe.

Doing such an investment only in Europe will make the economics so much worse that it will be prohibitive.

How Should Arabs Respond?

1- Trust the people:

Arab governments should avoid making these projects government-to-government. A cadre of national businessmen must be created. This is a golden opportunity.

2- Local use:

A complete new vision for landscape and usage of these new solar thermal plants must be established. Each village can be a company owned by the inhabitants, like in Switzerland with the inhabitants having rights to vote and control their own local affairs. Each plant of 100 MW can be a nucleus of a village. Some of the power can be used for desalination to settle more people into the desert. The rest can be exported with the income coming back to the owners/inhabitants.

3- A fair system:

People must be allowed to bid and get the European loan guarantees and be partners to their European counterparts. For example, some of the shares of those villages can be traded on the stock exchange, while others can be given to university graduates at the top of their classes. People's creativity must be unleashed.

Only then would the plan become a real chance of change.