Countries that changed their flags (and why)

A nation’s flag is something that is very important to its identity. It is the first means by which it identifies itself to the world, be it on ships at sea, in reference texts on the countries of the world, or at the Olympic Games. Here in America, we see our own Stars-and-Stripes as not only a symbol, but as something that is sacred, and should be treated with reverence.

Yet earlier this year, there was a political struggle in Malawi about what their flag should look like. See, since the African country’s independence in 1964, it had used a flag with a rising sun. Then, two years ago, the country changed its flag to one with a full sun.

The old flag on the left, the new flag on the right.

The old flag on the left, the new flag on the right.

The reason, according to then-president Bingu wa Mutharika, was that the long-standing “dawn” flag represented a nation that was still emerging and developing, while having the full sun on the flag symbolized that Malawi had emerged as a prosperous nation. “We don’t have to live permanently in the past,” he said.

The people of Malawi disagreed, and after Mutharika died his vice-president and successor, Joyce Banda, and the Malawian parliament changed the flag back to the way it was. The new flag was unpopular, and there was a great deal of support for returning to the old one. Henry Phoya, leader of the house, said, “Changing [the flag] willy-nilly is an unfair attack on a country’s sense of nationhood, an attack on a symbol which Malawians hold so dearly and passionately.”

Yet while Malawians may have decided a flag change was not for them, plenty of countries have changed their flags over the years, and been totally fine with the change. Here are just a few examples.


Canadian flag image from Wikipedia

The Maple Leaf is undeniably the symbol of Canada. Anything with this flag, or a design based on it, immediately identifies it as Canadian.

Canadian mittens image from Canadian Design Resource

Canadian soccer image from CBC

Canadian tourism logo from Niagra Parks

Yet, the flag of Canada is only 47 years old. The current flag was adopted in 1965. Before that, all of Canada’s flags were British.

In 1763, the British defeated the French in the French and Indian War, conquering Canada (then the colony of “New France”) in the process. Canada played a crucial role in the American Revolution. At the war’s beginning, the rebels hoped Canadians would join them in the revolution, but an American expedition into Canada failed miserably. From then on, Canada was an invaluable base for the British to launch attacks against the Americans. When the war ended and the United States was granted independence, many Tories (Americans who had supported the crown during the war) fled to Canada in order to stay British and escape reprisals by their Patriot neighbors. In large part, modern Canadian identity was forged in the War of 1812, when volunteer Canadian militias succeeded in keeping their southern neighbor from conquering them, as most of the British army was too busy fighting Napoleon in Europe to come to their aid until 1814.

But when the British did come... oh, man...

But when the British did come… oh, man…

Thus, loyalty to Britain and to the crown became a part of this Canadian identity, and the British Union Jack was flown from all government buildings while the Red Ensign, a British flag for merchant ships, was re-purposed as a flag used by ordinary Canadians to represent themselves.

Canadian 1891 Election poster from Wikipedia

Later, versions of the Red Ensign emerged with a badge affixed to the fly depicting the country’s coat of arms. This was the Canadian flag used by soldiers in both World Wars, and is still sometimes used at ceremonies commemorating those lives that were lost in the fighting.

However, Canadian opinion regarding the use of clearly British symbols began to slowly change. As Canada began to act less as a colony and more like a nation, sending diplomats around the world and athletes to the Olympic Games, the need for a uniquely Canadian flag began to appear. This need was never more apparent than during the Suez Crisis of 1956, when Britain and France attacked Egypt. Canada participated in the peace negotiations and sent peacekeepers to restore order, but the Egyptian government objected and claimed Canada couldn’t be neutral, because it used the same symbols as Egypt’s enemy. As if that weren’t enough, there was a growing chorus of Canadians descended from the original French colonists the British conquered who wanted to be rid of the use of a “foreign” symbol.

So, in 1965, after several years of debate, Canada changed its flag. The Maple Leaf was a popular symbol, politically neutral, and most importantly, not British. Since its adoption, Canadians have put the flag on absolutely everything, making it the defining symbol of Canadianness.


No, not the state (though that flag has undergone a lot of changes, too), but the country.

Georgia (the country) flag from Wikipedia

So, Georgia (the country) has been around for a long time – as in, since the days of Plato and Aristotle long. However, it hasn’t always been independent during this time. Romans, Arabs, Turks, Mongols, Persians, and Russians all took turns conquering the land. It attempted to assert its independence during the Russian Revolution, only to be conquered by the Bolsheviks and absorbed into the Soviet Union. Eventually, it was able to secure independence with the Soviet Union’s collapse, and once it did so, it re-adopted the flag it had used during its short-lived attempt at independence 70 years prior:

Georgia (the country) flag 2 from Wikipedia

The wine-colored banner was supposed to represent good times, both past and future, while the black stripe represented the “black times” under Russian rule and the white one represented peace. However, to most Georgians the flag soon came to represent the turmoil and warfare that came with post-Soviet independence.

Almost as soon as the dust had settled, a majority of Georgians wanted to adopt the five-cross flag, a banner that dates from the height of the medieval kingdom of Georgia’s power, and thus has a lot of resonance as a symbol of national pride. For years, President Eduard Shevardnadze blocked any attempts to change the flag, but in 2004 he was kicked out of office by Mikhail Saakashvili and the change was made.

South Africa

South African flag image from Wikipedia

South Africa’s flag was adopted almost by accident. In the early 1990s, the country was in negotiations to end their racist system of apartheid, which was essentially racial segregation on steroids. One of the demands of the anti-apartheid African National Congress was the adoption of a new flag.

The flag that South Africa had been using up to that point, while well-liked by white South Africans, was despised by the black majority as a symbol of apartheid. It was based on the flag used by 17th-century Dutch explorers in the area, with three smaller flags in the middle representing the British and the two (white-ruled) “Boer Republics” of Transvaal and Orange Free State that were absorbed into the Union in 1910.

Apartheid flag image from Wikipedia

When the decision was made to adopt a new flag, a competition was held in 1993 for people to submit their ideas. More than 7,000 designs were received, so you would think they would surely find a great design in there somewhere. But no. All 7,000 designs were ultimately rejected. Eventually, a quick compromise flag was adopted as an “interim” flag until a new one could be agreed upon. The new flag, which was a sort-of merger between the old flag and that of the African National Congress, was announced on April 20, 1994, giving South Africa’s flag makers just seven days to make and ship enough flags for the upcoming election and transfer of power!

That “temporary” flag is the one you saw at the beginning of this section. To give you an idea of how well-received it was, I once met a South African (now living in the U.S.) who said everyone at the time made fun of its Y-shape, asking “Why? Why? Why?” And yet, its simple yet elegant design grew on people. Instead of being replaced after a few years, as originally intended, it was written into the country’s constitution and is still flown proudly today.

The United States

US Flag image from Wikipedia

Oh, yeah. I just went there.

We may think of our flag as dating back to the American Revolution, and in a way it does, but in another sense America has had more new flags than almost any other country. It’s all because of those stars – one per state, with a new star added each time a new state is admitted to the Union. The basic design is the same, but each time a new state was admitted, the flag was redesigned to accommodate the new star. And we’ve had some really interesting designs in the past:

26 Star flag image from Wikipedia

29 Star flag image from Wikipedia


38 Star flag image from Wikipedia

But how we wound up with such a system is quite the story in its own right. Originally, the rebels under George Washington’s leadership used a flag with 13 stripes (one for each colony) and the British Union Jack in the corner.


Grand Union Flag image from Wikipedia

People forget this, but even as Americans were fighting the British, in the early days they saw themselves as fighting for their rights as Englishmen. Only later did they realize that independence was the only option really available to them, and once they decided on that course of action, they replaced the Union Jack with a field of 13 stars.

Betsy Ross flag image from Wikipedia

Then, after independence, Kentucky and Vermont quickly joined the Union, bringing the total number of states to 15. So, in 1795, two more stars and stripes were added to the flag.

15 Star flag image from Wikipedia

Then, a problem soon emerged: as even more states were admitted, it became apparent that adding a new stripe for each new state was impractical – either the flag would be gigantic, or the stripes would have to be increasingly tiny. So, for 23 years, they left it, even as more and more states were added. Finally, the Flag Act of 1818 sorted out the mess. It fixed the number of stripes at 13, for the original Thirteen Colonies, and increased the number of stars to 20, the number of states at the time. It further declared that each time a new state was admitted to the Union, a new star would be added to the flag the following July 4.

Thus, we have had a total of 28 different national flags. The 50-star variant we currently use is now the longest flag in our nation’s service, at 52 years old and still going.

But maybe not for long. As I mentioned in an earlier article, voters in Puerto Rico recently made a tentative step toward statehood. If we eventually do have a 51st state, then the following July 4, our nation’s flag will look like this:

Doesn't look all that different, really.

Doesn’t look all that different, really.

Information from Wikipedia

Four Facts about Christmas I bet you didn’t know!

Christmas fireplace from Write a Writing

It’s my favorite time of year once again! Christmas is just around the corner, and as Christmas carols are coming out of my stereo, I figured that after last year’s screed about “Happy Holidays” and “Merry Christmas”, this year I wanted to stay on a positive note. A jolly one, if you will.

HO HO HO! I crack myself up!

HO HO HO! I crack myself up!

So, here are a few facts I bet you didn’t know about Christmas.

In Japan, Christmas means going to KFC

KFC Christmas menu from Goukaseishi

Apparently, it is a major tradition in Japan to celebrate Christmas (which is not a national holiday in this mostly-Buddhist and Shinto country, but is widely practiced anyway) by eating some Kentucky Fried Chicken. The custom is so popular, people will pay as much as $40 for a big Christmas family dinner, and will often reserve their meals well in advance because KFC’s across Japan regularly sell out of the stuff!

Why the KFC obsession in Japan? Because in 1974, marketers working for KFC told the public that fried chicken was our traditional Christmas dinner! Think about that for a minute… advertisers duped the public to create a real tradition by telling them about a fake one.

SRSLY image from Funny Junk

Actually, though, multinational companies frequently use different branding and marketing techniques in different countries. For example, Pabst Blue Ribbon, which is one of the cheapest beers you can find here in America, is selling itself in China as some kind of super-exclusive beer of the rich. Mercedez-Benz may be a luxury brand here in America, but if Top Gear has taught me anything, it’s that in Europe, Merc is just another car company, like Ford or Toyota. Here in America, anime is worming its way into the mainstream, to the point that next year’s Superman movie is borrowing a whole lot from the genre’s aesthetic style. Yet in its native country of Japan, it is still very much considered “kid’s stuff”, and adults who obsess over it are considered weirdos.

However, it’s another thing entirely to outright lie to people about foreign cultures, since it’s pretty easy in our globalized world for people to… I don’t know… go visit the United States at Christmastime and learn the truth? I guess that’s why KFC is now pushing for us to eat there for our Christmas dinners, too:

Information from Tanutech, ABC News, and

Massachusetts once banned Christmas

You decide from Free Sppech America

So, yeah, last year I talked about the so-called “War on Christmas”. You know how I can tell you with absolute certainty that there is no such “war”, and that the holiday has never been stronger?

Because there really was a time, here in these United States, that it was illegal to celebrate Christmas.

The story starts with the Pilgrims on the Mayflower who settled at Plymouth, whose story we hear every Thanksgiving. They, and the later Puritan colonists that followed them to settle New England, were some of the biggest Grinches in history: not only did they refuse to celebrate Christmas, they considered it a sin to do so. Christmas trees, presents, and taking the day off of work? All of those things sent you to hell, they said.

Why? Well, originally, the festival that today is known as “Christmas” was not a Christian holiday at all, but an ancient Roman pagan holiday of Saturnalia. When the Romans converted to Christianity in the 4th century AD, they “Christianified” their holidays, and Saturnalia was re-purposed as a day to celebrate the birth of Jesus. To the Puritans, who took an extreme and literal interpretation of the Bible, celebrating Christmas was “residual Papist idolatry”.

So, the Puritans who settled in New England made the celebration of Christmas illegal, imposing a fine of five shillings on offenders. They eventually repealed the law in 1681, but even after it was legalized there was immense pressure by the church and the churchgoing public not to honor the day. During the American Revolution, some in Massachusetts saw the day as a symbol of monarchy and British royal power – not popular things at the time. Businesses were open on December 25, and people who celebrated in public instead of in their own homes were arrested for disturbing the peace. It wasn’t until after the Civil War, when Christmas became a federal holiday, that New Englanders finally got over themselves and opened up to the holiday.

Information from Wikipedia, Massachusetts Travel Journal, and the Wall Street Journal.

Santa Claus got his look from Coca-Cola (sort of).

Coca Cola Santa image from Snopes

Okay, so that’s a simplification. No, Coca-Cola didn’t invent the “standard” look of Santa Claus, with the red fur coat and hat, long, white beard, and pudgy but clearly human form. It is true, however, that Santa Claus evolved from a wide variety of European folk traditions that blended and merged in the American melting pot, and that before roughly the 1920s the jolly figure could be depicted in any number of ways – as a tiny elf, or an immortal, or even a Dutch sailor in a green winter coat!

By the early 20th century, though, a “standard” appearance and mythology of Santa Claus was starting to emerge. Coca-Cola didn’t invent this image to sell more Coke in the off-season, but the world-famous images by Haddon Sundbloom probably did help “fix” this image as the standard Santa Claus. After all, Coca-Cola was a worldwide company even in the 1930s, and its advertisements were widely seen both in places that had a Santa Claus tradition and those that had never before heard of the character, or even of Christmas.

Today, the Santa story is pretty consistent everywhere in the world except the Netherlands, which has clung tenaciously to its own St. Nicholas tradition and resisted assimilation.

Information from C.G.P. Grey, Wikipedia, and

Our Bibles almost told the story of Baby Jesus: Dragon-Tamer

How to Train Your Dragon image from Fanpop

I do not envy the ancient scholars who had to sort out which writings were going in the Bible and which weren’t. They had to figure out, out of the thousands of writings about God and man’s relationship to God, which ones were the Divine Word of God, and which were just some writings.

Some books they rejected were clear forgeries, some taught heresies and blasphemous teachings, and some were good writings that had religious value but just didn’t meet their very, very strict criteria for being “divinely inspired”. They had to be SURE that these books were the Word of God; mistakes were not acceptable.

Of course, as a Christian, I believe that God helped to guide them to making the right choices and that they got the right answers. Still, it is sometimes fun to look at the writings that were rejected and ponder “what if?”

A perfect example is the Gospel of Pseudo-Matthew, a short book about the origins of the Virgin Mary and the birth and childhood of Jesus that claims it was written by the Apostle St. Matthew, but has long been known to be a forgery. It has a very, er, interesting take on the Christmas story.

For example, it says that the Virgin Mary was a temple virgin as a child, and when she came of age she was one of five wives awarded to Joseph from among the girls who were too old to perform the temple rituals. It shows Joseph totally freaking out when he finds out about Mary’s pregnancy, and having her submit to a ritual test to make sure she was without sin. It says Jesus was born in a cave, and that the cave glowed with “the light of God” when he was born.

But the truly crazy part comes in Chapter 18. As the Holy Family ran from King Herod’s soldiers who were dispatched to kill the boy, it says they ran into a cave to rest, only to find it inhabited by dragons.

Yes, dragons.

Yes, dragons.

The little Jesus then miraculously walked up to the dragons and told them not to hurt anyone. And the dragons obeyed him. In fact, as they made their way to Egypt, lions, panthers, and other wild animals all bow before the little Jesus and guide the Holy Family to safety. Even a fruit tree bends its branches so the Holy Family can eat its fruit! Once in Egypt, the Holy Family goes to ask for directions in a temple full of ancient Egyptian idols, and in Jesus’s presence they all collapse and break into pieces out of shame. An Egyptian general comes out to see who is causing the disturbance, but when he sees the dead idols he bows before Jesus and Mary and tells the people to worship the one true God from now on.

The rest of the book is full of stories of miracles Jesus supposedly did while a child growing up in Nazareth. Of course, as I said before, the whole book has long been known as a fake – scholars think it was written around 600 AD. Still, it is definitely a very strange take on the Biblical story.

Information from Wikipedia. You can read the Gospel of Pseudo-Matthew here.


Christmas tree image from Fanpop

The Hobbit: An Unexpected Disappointment

The Hobbit promo from iMDB

Let me clarify something. The Hobbit: An Unexpected Journey is not a bad movie. It is, in fact, a very good movie. It’s a three-hour movie that doesn’t feel its length; it keeps you entertained throughout. It is visually stunning, with beautiful cinematography and Peter Jackson’s trademark “epic” style. The special effects are good, the acting is good, the action is good, and so on. It is a good movie.

But it’s not a great movie. And that’s the problem.

The Hobbit has some crucial weaknesses and flaws that drag it down, making it ultimately a disappointment. The biggest weakness by far stems from its source material. When I heard that Peter Jackson was making a The Hobbit movie, I thought, “That might make a great movie.” Then I heard he was stretching the story of J.R.R. Tolkein’s novel into three movies. That’s when I thought “Uh-oh.”

Each Lord of the Rings movie was based on a rather dense novel, and a whole lot had to be cut out of each film for time constraint reasons. But The Hobbit is a single novel, and a pretty concise one at that, a mere 310 pages. What, are they going to make a movie about every 100 pages? Even if they did that, they’d have to add a bunch of filler to make each movie a three-hour epic. Which is precisely what they did. They made up and added material to pad out the length and forge stronger links between this story and the story of the Lord of the Rings movies.

The result is, well, clunky. It doesn’t feel smooth and fluid. We spend a fair chunk of An Unexpected Journey with a character that is completely unrelated to the main plot and essentially unnecessary, only to set up a sequence that won’t appear until the next film. We get to see Saruman, supposedly before he turned evil. Okay, that sounds like it could be great – we get to find out what Saruman was like as a good guy and see him as Gandalf’s friend, making his betrayal in Lord of the Rings that much more compelling. But “good” Saruman turns out to be an arrogant jerk who dismisses and belittles Gandalf and generally acts like a bully. It just doesn’t work.

Once a jerk, always a jerk. Apparently.

Once a jerk, always a jerk. Apparently.

And don’t get me started about the point where we see giant, walking mountains beating each other up. Yes, that happens.

Wat image from Know Your Mene

The ending was pretty awesome, don’t get me wrong, but it doesn’t feel like the climax of a movie on this scale. So, when the credits began to roll, I heard more than a few cries of “That’s it?” from the audience. Myself among them.

Look, I’m trying not to sound too negative, here. It was a good movie, and made some smart choices. For example, we know that The Hobbit is not going to be as epic or action-packed as its more famous counterpart. So, how do you keep the audience’s attention? Why, with great characters, of course! Martin Freeman’s Bilbo Baggins is the perfect reluctant hero, whose actions and motivations are made the more compelling because he reacts very much like a member of the audience would in each given situation. Fans who prefer “rebellious and fun” Gandalf over “serious and wise” Gandalf will be in for a treat, as Ian McKellen turns in one of his best performances yet. By far the best part, though, is the dwarves – I found myself actually caring about what happened to characters with silly names like Balin, Dwalin, Bifur, Bofur, and Bombur.

The Dwarves from The Hobbit image from Geektown

Then again, the film also made some baffling choices, particularly when it came to the action scenes. One action sequence in particular just seemed to go on and on needlessly. It could have been about half as long and been far more compelling. Instead, we are treated to a Lord of the Rings-style over-the-top sequence that ends up looking inappropriate to the context and feeling like a slapstick cartoon.

The real problem, at the end of the day, is that as good as The Hobbit: An Unexpected Journey was, it simply can’t hold a candle to the Lord of the Rings films. When you have been trained to expect perfection, anything less than that is a disappointment. If this movie had come out first, or if the Lord of the Rings films didn’t exist, I would right now be singing The Hobbit‘s praises.

As it stands, I would take The Hobbit over The Amazing Spider-Man or the Robert Downey, Jr. Sherlock Holmes films, but if I had to pick between watching this or watching the recent film Argo, I would pick Argo. And that’s a Ben Affleck movie. Peter Jackson, it’s a bad sign when I’d rather watch a Ben Affleck movie.

Our thoughts and prayers are with the victims of the Newtown, Connecticut school shootings and their families. Cat Flag supports you in your moment of loss and grieving.

Awesome People in History: Sam Houston

Sam Houston image from Wikipedia

Texans are going to be really happy about this one.

It’s been a while since we’ve done one of these, and I have never shared the story of a man that I think is a true American hero. Sam Houston, the man who is one of the key reasons Texas is now a part of the United States and not Mexico, lived one of the most interesting lives of anyone I’ve ever known. He was governor of two states, the only U.S. governor to have previously been a foreign head of state, an officer in two different wars for two different armies, and a citizen of four nations. And he did all of it by being by all accounts both a real rough-and-tumble fighter and a man far ahead of his time. But I’m getting ahead of myself.

Sam Houston was born to a pioneer family in Virginia. His father had fought in the American Revolution, but died when Sam was 14 years old, leaving the family deep in debt. He moved with his mother and siblings to the then-very-new settlement of Maryville, Tennessee. Young Sam worked as a shop clerk in his older brother’s store, but felt very unsatisfied with his job and his life. At 16, he ran away from home, and joined the Cherokee Indians, living among them for three years. He was adopted by the Cherokee chief Ahuludegi (better known as “John Jolly”), who called him Colonneh, “the raven”.

In 1812, Sam Houston returned home to Maryville and started the first school in Tennessee. Shortly after, however, news arrived that America had declared war on Britain. Sam volunteered, and rose to the rank of lieutenant. At the Battle of Horseshoe Bend, he took an arrow to the groin but kept right on fighting. He also was wounded by bullets in the shoulder and arm before the war was over.

Returning home, he was briefly assigned as an ambassador to the Cherokees, returning to his adopted father Ahuludegi to convince him to relocate the tribe to Arkansas. It was a difficult assignment, and Sam chose to show up to negotiations in traditional Cherokee dress to make trust-building easier. For this, he was chewed out by his superiors, and therefore Houston quit.

Instead, Houston pursued a career in law and politics. He was elected to Congress in 1822, and in 1827 he took office as Governor of Tennessee. During this time, he also joined the Freemasons. Houston was widely believed to be a political supporter of Andrew Jackson, and this was mostly true, though he objected very strongly to the way Jackson’s government treated the Native Americans.

Gee, I wonder what he could have objected to?

Gee, I wonder what he could have objected to?

In 1829, he married the wealthy heiress Eliza Allen, but the marriage blew apart in a matter of months. The ensuing scandal shamed Houston out of office and out of state; he resigned on April 16 and moved back in with his adopted Cherokee family, who were now living in Oklahoma. He began drinking his problems away, earning the nickname “Big Drunk” among the Cherokees. Gradually, though, Houston got over himself, was declared a formal Cherokee citizen, remarried the half-Indian Tiana Rogers Gentry, and founded a trading post.

Houston saw many things he didn’t like about the way the U.S. government treated the Indians in Oklahoma, and in the early 1830s he made several trips to Washington, D.C. to protest. When he got nowhere, he finally snapped on April 13, 1832. He took his trademark hickory cane, and beat the living snot out of Rep. William Stanbery of Ohio. Convicted of assault, Houston was ordered to pay a fine and to pay $500 in damages to Stanbery. Instead of paying up, Houston fled to Mexico.

Not Canada? Really?

Not Canada? Really?

Now, we need a little background. In 1820, American businessman Moses Austin was given a grant by the Spanish government to settle 300 American families in Texas. Before the plan could take effect, two things happened that shook things up. First, Moses Austin died, and second, Mexico won its independence from Spain and Texas was now part of Mexico. Moses’s son, Stephen F. Austin, persevered and got the new Mexican government to recognize the original Spanish grant, and to later increase the number of American immigrants allowed into Texas. There were conditions, though. These American immigrants were required to convert to Roman Catholicism and learn to speak Spanish.

Thus, Sam Houston was baptized in the Catholic faith and became a Mexican citizen under the name “Samuel Pablo”. He tried to convince his wife Tiana to move to Texas with him, but she chose to remain in Oklahoma. She died of pneumonia in 1838.

No sooner had Houston arrived than he became embroiled in the growing political struggle between the American colonists and the Mexican government. In 1835, he was chosen to lead the new Texas Army. On March 2, 1836, he signed the Texas Declaration of Independence.

The war, at first, didn’t go so well for the rebels. After the defeat at the Alamo, Houston spent several weeks trying to train his not-at-all-fit “army” while retreating from the Mexican forces. Finally, on April 21, he was able to crush the Mexican forces in a surprise attack at San Jacinto. Though his horse was shot out from under him and his ankle was shattered, Houston was able to win with few casualties and even capture Mexican president Antonio Lopez de Santa Ana, forcing him to recognize Texan independence.

Okay! Okay! I'll give you your stinkin' independence already! Sheesh!

Okay! Okay! I’ll give you your stinkin’ independence already! Sheesh!

Houston easily won election as the first president of the new Republic of Texas. Right away, he tried to get the new country annexed to the United States, but Uncle Sam was not all that interested at the time. Furthermore, Houston was distracted by the struggle to maintain the fragile peace in the new country between Americans, Mexicans, and Indians. Constitutionally barred from serving consecutive terms as president, Houston stepped down in 1839 but remained involved in politics as a legislator. He spent most of his time in the Texan Congress fighting to protect the rights of Texas’s Indians. In 1840, he married yet again, this time to the strict Baptist and Alabama native Margaret Moffette Lea. She helped Houston get over his alcoholism, and had eight children with him. Eventually, Houston would become a Baptist himself.

In 1841, Houston won the presidency once again. He faced a country that was virtually bankrupt, and made many unpopular decisions to try to reduce expenses and maintain the peace. Several times, citizens and protesters blatantly violated his orders and prevented them from taking effect. Eventually, though, Texas secured annexation to the United States as its 28th state.

And giving a famous amusement park franchise its name.

And giving a famous amusement park franchise its name.

From 1846 to 1859, Sam Houston represented Texas in the U.S. Senate, where he was a moderate that opposed the break-up of the United States and incurred the political wrath of both pro-slavery and anti-slavery extremists. Though he was disliked by Texas politicians, he remained popular, and in 1859 he was elected Governor of Texas. Almost immediately, the political crisis that would lead to the Civil War overtook him. He begged the government of Texas not to leave the Union, but was ignored. On March 16, 1861, he was declared removed from office for refusing to swear an oath of loyalty to the Confederacy. He retired and settled in Huntsville, Texas, where he died in 1863.

Houston was quite the character, and although flawed, he seemed in the end to be a man with a great heart. To me, Houston was a man far ahead of his time. His constant struggle to defend Native Americans, at a time when many Americans wanted to wipe them from existence to get them out of the way for “civilization” to spread, and his failed attempt to keep Texas from siding with the South in the Civil War, teaches us that the right thing is worth fighting for, even if it is unpopular.

Information from The Texas State Historical Association, Wikipedia, and PBS.

Things that Drive us Crazy – Explained by Economics!

Screamer image from Deposit Photo

It seems like sometimes businesses around the world are conspiring to see how long it takes to make their customers scream, with maddening practices and outrageous prices. Except it turns out that these businesses are only doing what makes economic sense for them to do.

Now that I’ve finished the first quarter of my MBA program, I can say with confidence that there are very good reasons that businesses behave the way they do, even if they drive the rest of us crazy. Here are just a few of the things I’ve learned in my classes so far.

Why do cable and satellite TV companies force me to buy 8,000 channels if I only ever watch six?

HDTV image from 123RF

Right now, on Sunday I will watch NFL football on Fox, CBS, and NBC and sometimes Mythbusters on the Discovery Channel. On Mondays I will watch Top Gear on BBC America. The rest of the week, I will sometimes watch NBA basketball  on ESPN or TNT, and the rest of my TV viewing time is spent on the Discovery Channel, the National Geographic Channel,  H2, BBC America, the Military Channel, the Science Channel, and occasional peeks at what’s on HBO or AMC. So, I could get by with just 13 channels. Besides, I don’t watch TV as regularly as I used to, anyway; I spend far more time every day on YouTube. Yet cable companies don’t let us pick our channel a la carte, do they? We have to buy hundreds and hundreds of channels all bundled together. What is going on? It turns out that there is an economic reason for this plan, and like almost all of the things I’m going to talk about, it has to do with maximizing profits.

First, there is a concept in economics called “willingness to pay” (WTP). It is, literally, how much a consumer is willing to pay for a product. Everybody has their own WTP – you might be willing to pay $15 for a product, but someone else wouldn’t touch it for more than $5, and yet another customer might be willing to shell out $25 for that same product! Companies know this, and they accept that for any price they set, they will lose some customers because the product is too expensive for them, while other customers will think they’ve bought a bargain. That “bargain” – the difference between a customer’s WTP and the price they actually paid – is called “consumer surplus”.

And companies hate that knowledge. All companies want to maximize their profits, and the ideal way to do that is to charge every customer their exact individual WTP. That way, everybody buys, and nobody walks away with a consumer surplus because the company has taken all of their customers’ offered money. Unless you are one of those creepy companies that monitors every online purchase that everyone makes, there is just no way to do this in the real world. So, companies must do the next-best thing, and try to find ways to extract as much consumer surplus out of their customers as possible.

My money! Mine!

My money! Mine!

So, to use an example from my economics class, let’s say a cable company had 1,000 customers. Let’s say 400 of these customers would be willing to pay $20 for the Discovery Channel and $2 for VH1, while 600 customers would be willing to pay $11 for Discovery and $10 for VH1. If the cable company charged for channels a la carte, they would end up charging everybody $11 for Discovery (which everyone would buy) and $10 for VH1 (which only 600 customers would buy), earning a total of $17000.

OR… they can bundle the two channels together for $21. Everyone would buy the bundle, because they are all getting both channels either at or below what they would be willing to pay for the two channels individually. The company would then make $21,000!

Of course, this was a severe simplification – the real picture would look very different. Even so, the basic idea remains the same, by forcing you to buy a whole bunch of channels you don’t really want in order to get the few you do, the cable company is actually earning more money per customer than if they sold channels individually.

I just paid $60 for my Whatzit. Why do I now have to pay a whole bunch of hidden fees to use it?

Frustration image from BigStockPhoto

Again, Whatzit Corp. is just trying to suck up your consumer surplus… they’re just doing it in a far more direct way.

So, the trick here is that Whatzit Corp. actually sold you their product at cost. They made a grand total of exactly $0 on your purchase. But that’s just fine by them, because they know that now you are going to have to pay their fees, and it is in the fees where they will make their money.

Pictured: Hidden fees.

Pictured: Hidden fees.

In fact, if the company is smart, the amount of the hidden fees will be as exactly equal as possible to the consumer surplus of an average customer. There is some math involved in calculating this, and it assumes the company has a good idea of its customers’ behavior, but it is not an arbitrary number.

Product A and Product B are pretty much identical, so I was going to buy the cheapest. But they cost exactly the same! What’s going on?

Nook vs Kindle image from Gadget Review

Think about this from the point of view of the makers of products A and B. If both products start out at, say, $200, then Product A could cut its price to $190 and everybody would buy Product A. Then, if Product B lowered its price to $180, everybody would buy Product B. These two companies would be engaging in a “price war”, with each one trying to capture more customers by being the cheaper product.

There are two ways this scenario can work itself out. In a Bertrand-type situation, the two companies just keep cutting prices until they can cut no further, i.e. selling both products at exactly what it costs to make them. This situation benefits customers, because it guarantees the cheapest price. From the company’s point of view, though, this situation is terrible because nobody is making a profit.

The more common outcome, then, is a Cournot-type situation, where both companies decide to control how much of the product they manufacture. By the laws of supply and demand, this will mean that the price of the two products will be based on how many of these products are actually available for purchase. The amount of Product A that is placed on the market will be based on how much Product B is made, and vice-versa.

Of course, actual collaboration between the makers of Product A and Product B is illegal under U.S. law. It is also, however, economically unsustainable. If the makers of Product A and Product B agree to fix the amount of each that is put in production in order to give everyone the maximum price, the temptation is really, really strong for Product B to decide to cheat and cut its price just a little, netting it a huge increase in sales. Then Product A will retaliate and cut its price, starting the price war all over again.

It turns out, thanks to a useful mathematical model known as Game Theory, we can figure out how much of Product A and Product B the two firms will produce in a Cournot-type situation, and how much money each firm would make. It turns out the two companies would make less than they would if they tried an illegal collusion, but far more than the nothing they would earn in the Bertrand-type situation.

Why are gas prices always so high? Don’t they realize what an impact this is having on the economy? And my wallet?

Gas Prices image from Brother Peacemaker

Let me introduce you to an economic concept called “elasticity”.

Not that kind of elasticity!

Not that kind of elasticity!

If you make a product, and you lower the price on that product, you will gain more sales but will be making less on each sale. If you raise the price, you will lose sales, but you will gain more money per sale. Is it better to raise or lower prices, or keep them the same? How can you tell?

It turns out, economists have developed a measure for just this type of situation: elasticity. If a small change in your price creates a huge change in the demand for your product, that is said to be “elastic”. In this situation, it is better to lower your prices and attract as many customers as possible. If a large change in your price has almost no impact on the demand for your product, that is said to be “inelastic”. In this situation, it is better to raise your prices because you won’t lose many customers and you will more than make up for your losses in the increased profits per sale.

As you might have guessed, gasoline is very inelastic. Everybody depends on it, there aren’t very many good substitutes, and while you might drive less when gas prices go up it is a very rare person who will give up driving entirely. Oil companies can keep raising gas prices and raising gas prices and there is not a thing we can really do about it.

Of course, there are other essentials to daily life in the modern age – electricity, running water, telephone service, and so on. These “utilities” are extremely inelastic, which is why the government steps in an places strict rules on providers of these utilities to keep them from raising prices on all of us indefinitely. Yet gasoline and oil have never been deemed worthy of this level of regulation by the U.S. government. So, the prices just keep climbing and we keep devoting more and more of our income to paying them.

And speaking of rising prices…

I just got my bill from the hospital. What the heck?

Hospital bill image from The Accounting Student

If you think gasoline is inelastic, let me introduce you the medical industry. Prescription medications and medical procedures are as close as we have come to a “perfectly inelastic” pricing situation. You don’t really have an alternative to purchasing these products, except maybe dying. So pharmaceutical companies can get away with things like a 1200% price increase.

The only defense against these high prices is to buy health insurance or participate in government-run programs like Medicare and MediCal, in order to pool your costs with everyone else who participates in these programs. Many countries have gone so far as to set up a nationwide single-payer insurance plan that covers every citizen in order to further spread the costs so each individual patient pays less. (Though there are weaknesses to the single-payer system, too. I’m not going to go into all the ins and outs of the health care industry and my own opinions on them here; that would take at least two whole blog posts.)

Developing new medicines and medical procedures is expensive, and that research has to be paid for somehow. Otherwise, the company will not earn a profit and go out of business, which doesn’t benefit any patient. So, it looks like for the time being, we’re just stuck with high medical bills.

Taking MBA classes has opened my eyes to a whole new way of looking at things. Learning why businesses do what they do has helped explain so many of these otherwise perplexing situations.

Information from my Managerial Economics class.