10 November 2017   Leave a comment

US President Trump delivered a speech to the meeting of the Asia-Pacific Economic Co-operation (Apec) group, outlining his vision of the US role in the region.  Interestingly, he referred to the region as the “Indo-Pacific” rather than the more commonly used term “Asia-Pacific” ten times.  The chosen term downplays the significance of China from the American perspective and emphasizes the role of India, the US’s preferred partner in the region.  President Trump also identified several trade practices which have habitually been leveled against China without mentioning China by name:

“We will no longer tolerate the audacious theft of intellectual property. We will confront the destructive practices of forcing businesses to surrender their technology to the state, and forcing them into joint ventures in exchange for market access.

“We will address the massive subsidizing of industries through colossal state-owned enterprises that put private competitors out of business — happening all the time.

“We will not remain silent as American companies are targeted by state-affiliated actors for economic gain, whether through cyberattacks, corporate espionage, or other anti-competitive practices.

I am not sure what Chinese President Xi’s reaction to this rhetoric might have been, particularly since China had treated President Trump extravagantly just a few days earlier.

President Trump also singled out the World Trade Organization, one of the pillars of the liberal international system championed by the US since its earlier incarnation as te General Agreements on Tariffs and Trade, for harsh criticism:

“Countries were embraced by the World Trade Organization, even if they did not abide by its stated principles. Simply put, we have not been treated fairly by the World Trade Organization. Organizations like the WTO can only function properly when all members follow the rules and respect the sovereign rights of every member. We cannot achieve open markets if we do not ensure fair market access. In the end, unfair trade undermines us all.”

At this point, it does not appear as if there were any major decisions made at the summit, but we will wait to see if some were made secretly.  Chinese President Xi offered a very different view of the global economy, declaring that globalization was “irreversible”.

 

There is a mystery in Europe.  A cloud of radioactive material, ruthenium-106, has settled over the continent and the evidence suggests that it arose someplace in southern Russia.  The levels of radioactivity in Europe does not pose an immediate threat to health, but the concentrations suggest that the levels would have been dangerous at the point of release.  The Institut de Radioprotection et de Sûreté Nucléaire (ISNR) has issued a report on the contamination and it concluded that

“Because of the quantities released, the consequences of an accident of this magnitude in France would have required to implement locally measures of protection of the populations on a radius of the order of a few kilometres around the location of the release. Map identifying, on the basis of the model-measurement comparison, the most plausible release zone. For a simulated release at each point of the mesh, the comparison consists in estimating the percentage of modelled data which are within a factor of 2 compared to actual measurements. The area with the highest percentage is identified as the most plausible release zone.  The exceeding of maximum permitted levels3 for foodstuffs (1250 Bq / kg for Ruthenium 106 for non-milk products) would be observed over distances of the order of a few tens of kilometres around the location of the release.”

So far neither Russia or Kazakhstan has admitted to a nuclear accident.  But such matters cannot remain secret for long.

Map of the Ruthenium-106 over Europe

Map showing the plausibility of the origin of the release of Ruthenium 106 in Europe

 

The publication of the “Paradise Papers” has rekindled interest in offshore banking and the institutional infrastructure devoted to the purpose of helping the extremely rich avoid paying taxes.  We periodically re-acquaint ourselves with this legalized corruption but very little is ever done to prevent it.  Spiegel has an article which explains why it has proven to be impossible to assure that everyone pays their fair share of taxes which inevitably leads to higher taxes on the poor and a reduction of services to people in desperate need of help.

 

Smile Time

 

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Posted November 10, 2017 by vferraro1971 in World Politics

9 November 2017   Leave a comment

On 9 November 1938, the Jews of Germany and Austria endured a horrific night, as Nazi-thugs destroyed the windows of their shops and homes.  That night came to be known as Kristallnacht in reference to the sound of broken glass falling to the sidewalks.  That night was not the beginning of the persecution of Jews in Germany–that persecution had begun almost immediately after Hitler was elected Chancellor in 1933.  Even before Kristallnacht, Jews had been deprived of citizenship by the Nuremberg Laws (passed in 1935 and officially known as “Law for the Safeguard of German Blood and German Honor”) and restricted from certain economic activities and participation in Parliamentary elections.  I suspect that most Germans were uncomfortable with each step taken against the Jews, but likely believed that none of those steps would ever lead to the horror of the Holocaust.  The lesson is clear: any step to discriminate on any basis, no matter how small it seems, must be vigorously opposed.  Staying silent only assures that the powerful will interpret the silence as a license for even more stringent steps.

Nuremberg Laws (Originals Held by the US National Archives)  The First Signature is by Adolf Hitler

Rediscovery #: 23039
Job A1 10-185 Nuremburg Laws

Kristallnacht

Rediscovery #: 23039
Job A1 10-185 Nuremburg Laws

 

Saudi Arabia, the United Arab Emirates, and Kuwait have urged their citizens to leave Lebanon, following Bahrain which issued the same warning on Sunday.  The warning comes after the resignation of Lebanese Prime Minister Saad Hariri and his subsequent disappearance in Saudi Arabia.  The Lebanese believe that Hariri is being held under house arrest in Saudi Arabia, as many believe that Saudi Crown Prince Salman holds Hariri responsible for the growth of Iranian influence in Lebanon through its ally Hezbollah.  There is rising concern that Saudi Arabia may be preparing to go to war with Lebanon, but I find that possibility unlikely given that Saudi Arabia already has its hands full in Yemen–Lebanon would be a much more difficult conflict to manage.  Nonetheless, the regional tensions are reaching a fever pitch.

 

The Asia-Pacific Economic Cooperation (Apec) conference begins on Friday in Da Nang, Vietnam.  US President Trump will meet a number of foreign leaders, and each has a different set of issues with respect to the US.  The Guardian has a nice summary of what to look for as President Trump meets with Russian President Vladimir Putin, Philippine President Rodrigo Duterte, New Zealand Prime Minister Jacinda Ardern, Australian Prime Minister Malcolm Turnbull (that meeting should be quite interesting given the hostile relations between the two), and Malaysian Prime Minister Najib Razak.  One needs a scorecard for events as complicated as this one.

Posted November 9, 2017 by vferraro1971 in World Politics

8 November 2017   Leave a comment

The confrontation between Saudi Arabia and Iran is one of the more complex conflicts in the world.  The two states do not face each other directly, but are currently engaged through proxies in Syria, Iraq, Yemen, Qatar, and Lebanon.  Simon Henderson gives a good account of why the recent missile attack on Riyadh, Saudi Arabia from Yemen represents a significant escalation in the dispute.  Robert Malley offers a perspective from Lebanon which analyzes the fluidity of the alliances in the region and how Israel and the US, although not yet directly involved, create a destabilizing environment.  For its part, Iran blames Saudi Arabia for the tensions and that the US is manipulating Saudi Arabia for its own purposes.

 

The US State Department has suffered tremendous personnel losses over the last year.  Under the leadership of Secretary of State Rex Tillerson many career Foreign Service officers have simply left.  According to Zack Beauchamp in Vox:

“The number of people in each of those posts has declined dramatically since President Trump took office in January. The number of minister counselors in the State Department has gone down by 15 percent, career ministers by 42 percent, and career ambassadors by a whopping 60 percent.”

Due to hiring freeze imposed by Tillerson, many positions are being left unfilled and there is not a younger cohort being groomed to step into positions of higher responsibility.  According to Max Greenwood writing for The Hill the number of applicants to the Foreign Service has dropped by more than half in the last year.

 

Air pollution in New Delhi, India has reached such serious levels that schools there have been closed for a week.  The smog is an annual event in Delhi as farmers in surrounding areas burn farm residues after the post-monsoon harvests.  But modernity, in the form of cars and industrial activity, amplifies the problem and it is a serious health hazard to the residents of the city.  The New York Times provides the metrics of the seriousness of the problem:

“In some parts of the city, the levels of PM 2.5 — insidiously small particles that can settle deep in the lungs — had climbed to more than 700 micrograms per cubic meter, which is considered hazardous to breathe, according to data provided by the Delhi Pollution Control Committee. Scientists estimate these particles have killed millions.”

That level of PM 2.5 is more than 10 times the level considered safe.

New Delhi on Tuesday

Posted November 8, 2017 by vferraro1971 in World Politics

7 November 2017   Leave a comment

Saudi Arabia has asserted that Lebanon has “declared war” on the Kingdom, signaling its objective of removing Hezbollah from power in Lebanon.  The statement follows the resignation of Lebanese prime minister Saad al-Hariri, a strong ally of Saudi Arabia.  Saudi Arabia considers Hezbollah an Iranian ally and its fears of Iranian influence in Lebanon were accentuated when “Iranian official Ali Akbar Velayati trumpeted his regional alliance’s success from Beirut last Friday, declaring victories in Iraq, Syria and Lebanon.”  It is not clear what Lebanon’s future looks like.  Hariri was part of a coalition government with Hezbollah as its main partner and it is unclear whether Hezbollah can work with any other partners in forming a new government.  Lebanese politics are some of the most complicated of any nation-state on the planet.  It endured a brutal civil war from 1975-1990 and its governments can only form when all parties act in good faith.  On Lebanon, Israel and Saudi Arabia share the same objectives which complicate the politics significantly.  Israel’s Channel 10 has published a secret Israeli cable from the Foreign Ministry that outlines Israel’s support for the Saudi moves (the page is in Hebrew, but Google can translate it).

 

Today marks the 100-year anniversary of the Bolshevik Revolution in Russia.  It was the second revolution in Russia in 1917.  The first, in February, overthrew the Czar because of massive discontent with the war situation and widespread incompetence and misery.  In the past days of the Union of Socialist Soviet Republics (USSR) the day was one of great celebration; today it is observed only by the few ardent communists left in Russia.  The Russian President, Vladimir Putin, has said that he wished the Revolution had never occurred.  The Bolshevik victory in 1917 is one of the most contested events in history with widely divergent interpretations of how Lenin and Trotsky were able to seize and consolidate power.

Communists March in Moscow on Tuesday

Demonstrators attend a rally held by the Russian Communist party to mark the Red October revolution's centenary in central Moscow on Nov. 7. Photo by Sergei Karpukhin/Reuters

Posted November 7, 2017 by vferraro1971 in World Politics

6 November 2017   Leave a comment

Saudi Arabia intercepted a missile launched from Yemen toward the Saudi city of Riyadh and claims that the remains of the missile indicate that the missile was manufactured in Iran.  Saudi Foreign Minister Adel Al-Jubeir indicated that the coalition fighting the rebels in Yemen would “close all air, land and seaports to Yemen” in an effort to stop the flow of weapons from Iran to Yemen.  The blockade could bring Saudi and Iranian forces face-to-face even as both sides continue to fight proxy wars in Syria and Yemen.  There is increased concern that Saudi Arabia and Iran are edging closer to war, even as the situation in Saudi Arabia remains uncertain after the purge by the Crown Prince.

 

The massacre of the Rohingya continues: the Myanmar military continues to push them out of Rakhine Province and Bangladesh has indicated that it cannot take in any more refugees.  Patrick Lawrence has written an excellent essay for Salon which places the crisis in the context of the failings of the nation-state.  Lawrence compares the situation in Myanmar with other cases such as Sri Lanka and Catalonia and the analysis is both rich and sophisticated.   The UN Security Council has issued a statement condemning the violence, but a proposed resolution, which would have been legally binding, was not supported by China, which has a close relationship to Myanmar.  Many are beginning to use the terms “ethnic cleansing” and “genocide” to describe the situation, but the world refuses to take effective action.  The Economist compares the flow of Rohingya refugees to other similar crises in the world.

 

Perhaps the country we should all keep our eyes on in the effort to avert climate change is India.  The US has leveled off its carbon emissions even though the Trump Administration has decided to leave the Paris Agreement–states and localities are taking care of emissions as the Federal Government defaults on its responsibilities.  China has made incredible strides in renewable energy and seems firmly committed to reducing its emissions although its task remains formidable.  India is also committed to renewable energy, but its poverty rate remains significantly higher than in China and it has far fewer options in terms of making a transition to non-carbon based fuels.  Given its rapidly growing population, India is likely the country that will determine whether climate change can be avoided. 

Posted November 6, 2017 by vferraro1971 in World Politics

5 November 2017   Leave a comment

Since 11 September 2001 the US has engaged in many conflicts in what was called a “war on terror”.  It has been a very expensive war that has been paid for by increased government debt and not tax increases.  The US Department of Defense has released a 74-page report entitled “Cost of War Update as of June 30, 2017.”  The report focuses only on the actual costs incurred because of combat operations and does not include future costs of the wars which will include medical care and pensions and other benefits guaranteed to military veterans.  So it is a very constrained estimate of the costs of the war on terror.  Nonetheless, it is extraordinary to know that even with this limited definition of cost, the US has averaged $3.6 billion a month on combat operations.  The report is quite detailed and for those who wish to examine the entire range of expenditures necessary to support war.   There are other, higher estimates of the costs of these wars.  One is by the Congressional Research Service.  The highest estimate, by the Watson Institute on International and Public Affairs at Brown University puts the costs at $4.79 trillion.   The entire Defense Department budget is significantly larger, amplified by the massive military footprint the US maintains in its more than 800-military bases abroad.

 

US Military Bases Abroad

 

 

Saudi Arabia’s Crown Prince Mohammed bin Salman, the likely next King of Saudi Arabia and often referred to as MbS, launched a corruption purge of Saudi officials which included some of the highest ranking members of the royal family.  Among those arrested include Prince Alwaleed bin Talal, one of the world’s richest persons and a major investor in many global corporations including Twitter, Lyft, and Citigroup.  It is highly likely that Alwaleed will ask many of his co-investors, which include many of the richest people in the US, to intervene on his behalf.  If those interventions actually occur, it will complicate US relations with Saudi Arabia tremendously.  But corruption is hardly the main concern of the Crown Prince.  Patrick Wintour, the Diplomatic Editor of the Guardian, interprets the move in this way:

“The crown prince will say the arrests show his determination to root out corruption, a precondition of a more open economy. But few think the arrests, and related ministerial sackings, are the independent decision of a new corruption body, established just hours before to replace an existing one, rather than part of a wider reshuffle to centralise all security authority under MbS.”

The Crown Prince has shown that he is not afraid to take risks, initiating a brutal war against rebels in Yemen he believes to be agents of Iran and cutting Qatar off from normal economic and political ties from other Gulf States.  Neither of those moves has proven to be particularly effective, and we will see what the repercussions of this purge will be to Saudi political stability.

Crown Prince Mohammed bin Salman

 

The International Consortium of Investigative Journalists, (ICIJ) has published an unbelievable number of offshore banking accounts which reveal the world of the very richest people in the world and how they use money that they were assured would be held secretly.  The leaked documents, labelled the “Paradise Papers” reveal “the offshore ties of more than a dozen Trump advisers, Cabinet members and major donors”.   For those with interest in pursuing some of the papers, the site offers the opportunity to search the 13.4 million records.  The article lists some of the more prominent investors, and the activities are characterized in this way by the ICIJ:

“The offshore industry makes ‘the poor poorer’ and is ‘deepening wealth inequality,’ said Brooke Harrington, a certified wealth manager and Copenhagen Business School professor who is the author of ‘Capital without Borders: Wealth Managers and the One Percent.’

“’There is this small group of people who are not equally subject to the laws as the rest of us, and that’s on purpose,’ Harrington said. These people ‘live the dream’ of enjoying ‘the benefits of society without being subject to any of its constraints.’”

These loopholes are very expensive to create and therefore beyond the means of most people.  But once created, they shelter trillions of dollars from taxation.

Posted November 5, 2017 by vferraro1971 in World Politics

4 November 2017   Leave a comment

One of the fundamental tenets of the liberal ideology is that the state should not discriminate against any citizen on the basis of religion (as well as other attributes, such as race or ethnicity).  But many nations strongly identify with a specific religion.  Indeed, some have official religions.  The tensions between liberal states and various interpretations of the nation can be intense.  For example, the Republican candidate for the US Senate in Alabama, Ray Moore, has said on various occasions that God’s law is above man’s law (Moore is a devout Christian).  The tensions are apparent in many eastern and central European states who have moved from the official Communist position of atheism toward the liberal democracies of western Europe.  The Pew Research Centerreligion affects the policies of many of these states. has evidence on how

 

The Lebanese Prime Minister, Saad Hariri, has resigned citing the growth of Iranian influence over his nation and fears over being assassinated.  Hariri has been in office for 11 months and has not been able to exercise effective control over the government which is strongly influence by the Iranian-backed Hezbollah.  Hariri gave the speech in Saudi Arabia and he said that Iran” “has a desire to destroy the Arab world and has boasted of its control of the decisions in all the Arab capitals. Hezbollah imposed a reality in Lebanon through force of arms, and their intervention causes us big problems with all our Arab allies”.  The position articulated by Hariri dovetails almost completely with the official views of Saudi Arabia and the US.

Saad Hariri

 

It is incredibly difficult to appreciate the economic power of China, but Visual Capitalist has published a graphic which is simply mind-blowing.  There are 31 Chinese cities that produce as much as the GDPs of many highly developed countries.

 

31 Chinese Cities With Economies As Big as Countries

Posted November 4, 2017 by vferraro1971 in World Politics

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