Month: February 2025

Uncategorized

The Parable of Lazarus and the Shipping Magnate

| thetembo
Reading Time: 2 minutes

There was a man named Lazarus, the son of a fisherman, who lived on the shores of a once-pristine island. The waters had once been as clear as glass, the reefs vibrant with color, and the fish abundant and fat. But those days were long gone.

Every morning, Lazarus would recline in his sun-bleached beach chair, its legs buried deep in the warm sand, gazing out at where the horizon should have been. But there was no horizon anymore—only an endless procession of steel behemoths. A twenty-mile parking lot of bunkering freighters, supertankers, cruise ships, tugboats, ferries, and oil tankers, all waiting to feed on the monstrous peninsula of oil storage and berthing ports. The air reeked of diesel and sulfur, while the water, though still shimmering in the sun, carried a sickly sheen.

One day, overcome by the heat, Lazarus stood up and walked to the shoreline. The waves lapped at his feet, warm and familiar, whispering promises of refreshing relief. He dove in.

At first, the water embraced him as it always had. But as he swam farther, that embrace turned sour. A slick of oil clung to his skin. The sting of chemical discharge burned his eyes. Beneath him, the reef was silent—no fish, no movement, only the bleached skeletons of what had once been. Lazarus struggled, coughing, his limbs weak from the poison seeping into his pores. He cried out, but no one listened.

Far above, on the highest deck of the grandest yacht in the bay, the shipping magnate feasted. His table groaned beneath the weight of delicacies flown in from a world away, and his wine glass brimmed with the finest vintage. He laughed and toasted his guests as his fleet filled their bellies with crude oil and sent their filth into the waters below.

And then, Lazarus was gone.

When death came, it bore him away to the cool embrace of the unblemished deep, where the currents flowed pure, where whales still sang, where the ocean’s heart continued to beat strong.

But the shipping magnate, in his time, also met death. And when he opened his eyes in the afterlife, he found himself standing upon the very shore he had defiled. The sand burned his feet, the air choked his throat, and the water—oh, the water—was as black as tar, boiling with the waste of his empire. He saw Lazarus far off, resting in the arms of the ocean’s forgotten gods, and he cried out:

“Lazarus! Have mercy on me! Dip but a finger in clean water and cool my tongue, for I am tormented by this poison!”

But a voice answered him:

“Did you not feast while others choked? Did you not build your fortune upon the ruin of the sea? The waters you abandoned are the waters you must now endure.”

And the magnate wept, but no tears fell—only a drop of oil.

Author’s Notes:
Inspired by a visit to the island of Lazarus off the coast of Singapore and the biblical parable.
Assist by ChatGPT.

Writing

Palm Oil and Orangutans

| thetembo
Reading Time: 5 minutes

Me (as commentator): In this discussion, ChatGPT and I are working together to create a better world for palm oil and orangutans.

It started with a trip to Costa Rica with my brother. He shared with me the environmental destruction caused by the demand for palm oil. Then, I witnessed it firsthand in Malaysia—vast stretches of oil palm plantations stretching endlessly across the landscape. When I read about similar plantations in Indonesia, the enormity of palm oil’s impact became impossible to ignore. It’s present in everything—from chocolate bars to biofuels. That’s when I turned to ChatGPT for answers.

Me: How does the global supply chain for palm oil operate? What are the net benefits and environmental costs, particularly in Malaysia and Indonesia?

ChatGPT: Palm oil is one of the most widely used vegetable oils worldwide, and it is used in processed foods, cosmetics, and industrial applications. Its supply chain follows a structured path: cultivation in tropical climates, harvesting and processing into crude and refined products, and global distribution to major markets like China, India, the EU, and the U.S. Sustainability efforts, such as RSPO (Roundtable on Sustainable Palm Oil) certification, exist, but their effectiveness varies.

Palm oil has undeniable advantages. It yields far more oil per hectare than alternatives like soybean or rapeseed, making it incredibly efficient. It supports millions of jobs, particularly in Malaysia and Indonesia, and its affordability makes it a staple in global food security. However, the environmental cost is steep.

Clearing rainforests for plantations has threatened species like orangutans and Sumatran tigers. Draining peatlands releases vast amounts of CO₂. Monoculture farming depletes nutrients, and runoff from pesticides pollutes rivers. Land grabs and exploitative labor practices continue to be widespread.

The problem is complex. Palm oil is too efficient and economically embedded to remove, yet its environmental impact calls for accountability. Stricter regulations, improved land management, and consumer demand for sustainable sourcing could help tip the scales.

Me (as commentator): That brings up another question. Is it good for you?

Me: What health effects and issues are associated with palm oil?

ChatGPT: The health impact of palm oil varies based on its form and consumption method. Unrefined (red) palm oil is abundant in carotenoids and vitamin E, providing antioxidant benefits that promote eye health and alleviate oxidative stress. It also features a balanced fat profile that is more stable than polyunsaturated oils but less harmful than trans fats. Its high smoke point makes it perfect for cooking without generating harmful free radicals.

However, refined palm oil, which is commonly found in processed foods, presents a different narrative. Excessive consumption may elevate LDL cholesterol levels and heighten the risk of heart disease. The processing removes beneficial nutrients, and repeated heating can generate toxic compounds associated with inflammation and metabolic disorders. Additionally, there are concerns about contaminants such as 3-MCPD, a potential carcinogen present in certain refined palm oils.

Palm oil can be part of a balanced diet in moderation, particularly in its unrefined form. However, its use in ultra-processed foods contributes to broader public health concerns, making alternative oils like olive or avocado oil preferable for those worried about cardiovascular health.

Me (as commentator): By now, a broader theme was emerging—one that connected economics, politics, and the environment. Once again, I reflected on Why Nations Fail, a book that examines how extractive political and economic institutions eventually collapse under their own weight. Our relationship with nature, especially in industries like palm oil, has become similarly exploitative.

Me: How does the framework of extractive versus inclusive institutions apply to palm oil? Can the industry transition to a sustainable model?

ChatGPT: The traditional palm oil industry mirrors extractive institutions. Power and profits are concentrated in a few hands, while environmental and social costs are externalized. Short-term gains drive deforestation, land seizures displace communities, and monopolistic control leaves small farmers at a disadvantage. These systems appear profitable, but their foundations are unstable. Degraded land loses productivity, regulatory pressure mounts, and climate change disrupts supply chains.

A shift toward inclusivity would align economic incentives with environmental health. Agroforestry and polyculture could replace monoculture, maintaining biodiversity and soil fertility. Smallholder cooperatives would ensure fair profit distribution, preventing land grabs. Stronger land rights and environmental regulations would safeguard both people and ecosystems. Carbon taxes and sustainability incentives could make responsible practices more financially viable.

Emerging technologies could play a crucial role in this transition. Blockchain enhances supply chain transparency, ensuring that palm oil labeled as sustainable is verifiably sourced from ethical producers. AI-driven monitoring can analyze satellite imagery to detect illegal deforestation in real time, enabling quicker enforcement of conservation laws. Consumer awareness tools, such as apps that scan product barcodes to provide sustainability scores, empower shoppers to support ethical brands. These innovations bridge the gap between policy and action, fostering an industry that benefits both people and the planet.

Once satellite data confirms land use compliance, blockchain records transactions from plantation to refinery. Farmers upload geotagged proof of sustainable practices (e.g., reforested areas, legal permits). Each step in the supply chain is logged on an immutable blockchain ledger, preventing fraud. Consumers scan QR codes on products to verify deforestation-free palm oil origins.

Organizations like Global Forest Watch (GFW), NASA, and the European Space Agency (ESA) use satellites to monitor forests. Radar-based satellites can see through clouds, even in rainforests. Buyers can verify if a plantation is inside a deforestation-free zone. 

Such changes would preserve rainforests and wildlife and create long-term economic stability, ensuring that palm oil remains a viable industry without destroying the land it depends on.

Me: What would prevent people from cheating the system?

ChatGPT: Once satellite data confirms land use compliance, blockchain records transactions from plantation to refinery. Farmers upload geotagged evidence of sustainable practices (e.g., reforested areas, legal permits). Each step in the supply chain is recorded on an immutable blockchain ledger, preventing fraud. Consumers can scan QR codes on products to verify the origins of deforestation-free palm oil.

In 2021, a Malaysian palm oil supplier was discovered to be selling “certified sustainable” palm oil that was actually sourced from illegally deforested areas. The fraud was uncovered through blockchain traceability, AI-driven satellite monitoring, and chemical fingerprinting.

The supplier claimed their palm oil was Roundtable on Sustainable Palm Oil (RSPO) certified, and they forged documents to show compliance. The company purchased palm oil from illegal plantations (including deforested peatlands) and mixed it with genuine certified palm oil at the refinery. They manipulated geolocation data to create the illusion that the palm oil originated from legal farms. GPS spoofing was employed to forge transport records.

A European buyer using blockchain-based supply chain tracking noticed inconsistencies in shipment data. The timestamps didn’t match transport records from the supposed “sustainable farms.” AI-powered satellite imagery (from Global Forest Watch and NASA) detected recent deforestation near the supplier’s reported farms. Machine learning flagged the sudden land use change as suspicious. A DNA-based oil fingerprinting test showed that the oil came from different soil and climate conditions than the claimed certified farms. This revealed the illegal plantations’ true origins.

The palm oil company lost its RSPO certification, and its EU contracts were canceled. Malaysian authorities imposed a fine on the company for fraudulent practices. Buyers began requiring blockchain-based traceability for every shipment. The industry started using satellite verification and AI monitoring as standard anti-fraud tools.

Me (as commentator): The conversation left me without easy answers, but it provided a clearer understanding. Palm oil isn’t inherently bad—it’s our methods of production and consumption that determine whether it becomes a force for progress or destruction. The challenges facing the industry are political, ethical, and economic, yet technology offers solutions to create an inclusive palm oil industry. History has shown us that extractive systems don’t endure. The real question is whether practices will change course significantly enough to have an impact before the system collapses under its own weight.

Author’s Note: Credits to ImageFX for the cover image. ChatGPT for the conversation. Grammarly for the corrections.

Writing

A Tale of Two Cities

| thetembo
Reading Time: 5 minutes

While researching background information for my upcoming book, “Book a Trip,” which is based on my travels to Malaysia and Singapore, I asked ChatGPT to explain the differences between Johor Bahru and Singapore in light of the analysis presented in “Why Nations Fail.” I found ChatGPT’s analysis insightful and decided to share it here.

Author’s Note: ChatGPT’s facts hold up to superficial scrutiny on Wikipedia. I present this discussion not as definitive research but as a starting point if you ponder where and why the two countries diverged.

Me: Is there a political and economic explanation for the disparity between the culturally similar and geographically colocated cities of Singapore and Johor Bahru along the lines of extractive versus inclusive political and economic institutions described in the book Why Nations Fail?

ChatCPT: Yes, the disparity between Singapore and Johor Bahru (and, by extension, Malaysia as a whole) can be analyzed using the framework of Why Nations Fail by Daron Acemoglu and James A. Robinson. The book argues that the key to long-term economic prosperity lies in inclusive political and economic institutions, which encourage broad participation, protect property rights, and create incentives for innovation and investment. In contrast, extractive institutions concentrate power and wealth in the hands of a few, stifling broad-based economic development.

Singapore: Inclusive Institutions

Despite its early struggles following independence in 1965, Singapore developed inclusive economic institutions through a robust rule of law, strong protection of property rights, and a meritocratic civil service. The city-state attracted foreign investment by fostering a corruption-free business environment, enforcing contracts, and ensuring political stability. While Singapore often faces criticism for its authoritarian-leaning government, its political institutions, although not fully democratic, have been relatively inclusive in ensuring policy continuity, heavily investing in education and infrastructure, and avoiding the patronage-based politics that burden many post-colonial states.

Johor Bahru: Extractive Institutions in a Malaysian Context

In contrast, Malaysia has experienced a history of more extractive institutions, particularly regarding the concentration of political and economic power within specific groups. The New Economic Policy (NEP), introduced in the 1970s to tackle ethnic disparities, established an affirmative action system that, while aimed at uplifting the Malay majority, also entrenched cronyism and rent-seeking behaviors. Political elites controlled key industries, and economic policies often favored businesses with political connections rather than promoting broad-based competition. This approach discouraged investment and entrepreneurship compared to Singapore’s open and competitive economy.

Border Effect and Divergence

Johor Bahru, although it is located next to Singapore and shares cultural similarities, functions under Malaysian institutions. Consequently:

  • Bureaucratic inefficiencies and corruption create hurdles for businesses.
  • Land and infrastructure development are often tied to political patronage.
  • The regulatory environment is less favorable than Singapore, deterring high-value investments.

Johor Bahru has benefited from spillover effects—such as Singaporean companies setting up factories or Malaysians working in Singapore for higher wages—but these gains are limited by Malaysia’s broader institutional constraints. In contrast, Singapore’s institutions have actively shaped an economic ecosystem that fosters long-term growth.

Conclusion

Following the logic of Why Nations Fail, the contrast between Singapore and Johor Bahru illustrates how different institutional choices lead to significantly different outcomes. Singapore’s relatively inclusive institutions (despite political constraints) have promoted innovation, stability, and high-value economic activity. Malaysia, while more developed than many of its regional peers, still experiences extractive tendencies that hinder Johor Bahru’s ability to fully leverage its proximity to Singapore. This dynamic continues to influence the economic divide between the two cities.

Me: Can you expand on the lack of fully democratic and authoritarian-leaning politics, as this contradicts the Why Nations Fail hypothesis?

ChatGPT: Singapore’s case presents an apparent contradiction to the hypothesis in Why Nations Fail, which argues that inclusive political institutions are necessary for inclusive economic institutions to emerge and sustain long-term prosperity. Singapore has achieved high levels of economic success despite having a political system that is not entirely democratic and exhibits authoritarian-leaning traits. Here’s how this paradox can be understood:

1. Singapore’s Political System: Not Fully Democratic but Stable

Singapore functions as a parliamentary republic with regular elections; however, its political landscape is dominated by the People’s Action Party (PAP), which has held power since independence in 1965. Several factors contribute to its authoritarian-leaning characteristics:

  • Strong State Control: The government exerts tight control over the media, public protests, and political opposition. Defamation lawsuits and regulatory restrictions are employed to suppress dissent.
  • Legal and Institutional Mechanisms: Laws like the Internal Security Act permit detention without trial, and the government wields considerable influence over electoral boundaries and political competition.
  • Limited Political Pluralism: Although opposition parties are present and have made some progress in recent years, the PAP continues to hold a dominant position due to a blend of governance success, institutional control, and legal obstacles to opposition growth.

Despite these authoritarian tendencies, Singapore has not established extractive political institutions in the way Acemoglu and Robinson describe. Rather than concentrating wealth and power in the hands of a narrow elite that hinders economic dynamism (as seen in genuinely extractive regimes), Singapore has built a technocratic, meritocratic, and accountable governance system that emphasizes national economic growth over the personal enrichment of ruling elites.

2. How Has Singapore Avoided Extractive Tendencies?

Singapore’s governance model operates differently than traditional authoritarian regimes by upholding several key characteristics that align with inclusive economic institutions.

  • Rule of Law and Strong Institutions: Unlike extractive regimes, where the political elite rewrites laws for personal gain, Singapore has built a highly efficient, rules-based bureaucracy with low corruption.
  • Meritocracy and Competence: Government positions and economic opportunities are primarily based on merit rather than political loyalty, minimizing the inefficiencies associated with cronyism.
  • Public Goods Investment: The state consistently invests in infrastructure, education, and housing, ensuring widespread benefits instead of concentrating wealth in a small elite.
  • Economic Openness: Singapore has embraced free markets, attracted foreign investment, and promoted competition, steering clear of the monopolistic tendencies often found in extractive economies.

3. Why Does Singapore Work Despite Its Political Constraints?

Acemoglu and Robinson argue that inclusive political institutions create feedback loops that sustain inclusive economic institutions. However, Singapore has maintained long-term economic success despite its dominant-party rule because:

  • Elite Constraints Exist Internally: Although the PAP holds significant power, it is limited by internal norms, elevated public expectations, and global economic pressures. The government is highly responsive to economic challenges and community concerns.
  • Political Stability Has Encouraged Investment: Unlike many authoritarian regimes, where political power shifts violently or unpredictably, Singapore’s stability is a vital asset in attracting businesses and investors.
  • Performance Legitimacy: Rather than depending solely on force, the government secures legitimacy by consistently providing economic growth, effective governance, and a high quality of life.

4. Is This Model Sustainable?

Singapore’s model works as long as the ruling elite remains committed to national prosperity rather than personal enrichment. However, if the PAP’s dominance leads to complacency, growing inequality, or declining political responsiveness, the absence of democratic safeguards could become a liability. Political transitions in non-democratic settings can be risky, and if the current system weakens without institutionalized political competition, Singapore could ultimately face governance challenges.

Conclusion

Singapore’s case challenges the Why Nations Fail framework by demonstrating that economic inclusivity can thrive in a system with limited political inclusivity—but only under specific conditions. The key distinction is that while Singapore’s political institutions are not fully democratic, they are also not entirely extractive. The country has managed to avoid the elite capture, rent-seeking, and cronyism typically associated with extractive regimes, allowing its economy to prosper. However, this success relies on sustained institutional integrity, which is not guaranteed over the long term.