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Excerpt: In an interview that might very well turn my last post on its head, Andrea Elliott from the NYT went on Charlie Rose to explain the new trend of American radicalization, epitomized by a small-town Alabaman boy that went on to become the face of fighting and recruiting propaganda for an Islamic insurgency based out of Somalia. Two points are interesting. One: the relationship between economic disenfranchisement and radicalization is not always there. In this case, Hammami comes from a well-off middle-class family from a small town in the South, presumably without the cluster of poverty and fanaticism associated with Europe’s immigrant…
Politics & the Economy
Politics and economics are inextricable. Hardly surprising, money and power have a way of finding each other. How does a system's political aspiration and manifestation affect its economic decisions? That's the question here.
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Excerpt: Having forged some pretty sturdy commercial ties with Africa and Latin America, China is now entering Eastern Europe. Long-time backyard of Russia, and some-time cold war battlegrounds in bygone days, many have become scourges of Europe in recent years. Enters China with tons of cash. China last July signed a memorandum of understanding to lend Moldova $1 billion – equal to a tenth of the east European country’s gross domestic product, and easily the biggest loan it will have received from anywhere. Last June, it agreed to invest more than $1 billion to build power plants and roads in Tajikistan, an impoverished ex-Soviet…
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Excerpt: Just to be clear, there’s never been an acknowledged nor formal definition of the Beijing Consensus, which is an alternative economic development model to those proposed by the Washington consensus. This article in Foreign Affairs argues time might be running out on this social contract based on a trade-off of political and economic freedoms, when and if the country’s economic growth slows down. China’s astronomic growth has left it in a precarious situation, however. Other developing countries have suffered from the so-called middle-income trap — a situation that often arises when a country’s per-capita GDP reaches the range of $3,000 to $8,000,…
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Excerpt: Compassion or cruelty? That is the question raised by the Economist, when assessing Europe’s particularly rigid labour market. Countries ranging from Italy, Greece, to Spain and Sweden, have been staunch defenders of its labour-market laws and social system. Two problems are raised. One is that the natural desire for social cohesion is being abused to justify the protection of “insiders”—those in permanent jobs, in trade unions or in privileged professions. But the cost of protecting insiders falls largely on “outsiders”—the unemployed and those in temporary work, especially young people and immigrants. Essentially, the call to preserve social cohesion can be abused to protect the…
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Excerpt: Not a dilemma for countries in the West, since most have imposed economic sanctions on North Korea, which means no trade, but also no humanitarian aid either. However, this doesn’t quite work for those in the neighbourhood. For South Korea, China and Japan, North Korea is a reality that must be dealt with, in all its cultural-socio-geo-political complications. This is an interesting point brought up by a blogger that I’ve not considered before: do you send aid to North Korea, or don’t you? China and Japan may be weary of a nuclear North Korea. But more likely than not, those two are more…
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Excerpt: CSM has a series of articles the past weekend on the perils of ignoring land disputes in Africa. Perhaps not at all surprising, given survival in largely agricultural and herding communities depend on pastoral and grazing grounds. Most of the deadly conflicts in Africa over the last two decades erupted from unresolved land issues: Darfur, DRC, Ethiopia vs. Eritrea, Kenya, Rwanda, Zimbabwe; and trouble brewing on the horizon: Burundi, South Africa, Sudan, Uganda, Zambia, are all related to land. Even the Nigerian riots over the weekend, supposedly as a result of religious frictions between the Muslim and Christian groups, can really be…
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Excerpt: From the way it approaches relationship-building with its neighbours, it sounds like the second-coming of Turkey, whom is also busy re-arranging regional chess pieces under the radar. With Turkey: The countries came close to war a decade ago, now they are establishing a strategic partnership that will have major consequences for the future of the region. Opening the Turkish/Syrian border, removing the visa requirement, and restoring a stretch of the Hejaz railway line that operated before the first world war should lead to an unprecedented increase in bilateral trade. Trade has already risen from $500m to $1.8bn over the past 10 years. Balancing…
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Excerpt: India became an independent nation 60 years ago yesterday. Congratulations! And to celebrate the day, the South Korean president was invited to attend the Indian version of the White House state dinner. What does the two countries have in common? A lot of trade, as it turns out. Since the end of the cold war, India has followed a “Look East” policy that calls for building deeper trade and security ties with Asian nations rather than focusing on Europe and America. India is now diving into economic integration with Asia, beginning with a new comprehensive trade deal with South Korea. Economically, the two countries…
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Excerpt: Life is getting worse and worse still in North Korea. From its currency devaluation last year, to the effective halt in black-market trading of food items due to a curb in foreign currency transactions, putting enough food on the table everyday has become an almost impossible task for over a third of its 24 million people. And now, this piece of data: over the past two months, some parts of the country has experienced a 12-fold inflation in the price of rice. Twelve fold! So first currency collapse, then mass starvation and now impending famine. How will the economy function? Joshua Stanton think…
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Excerpt: David Frum gave a speech in Caracas on the state of Venezuelan politics, and made a few observations. Chile was held up as an example of success, where democratic leaders that took over from Pinochet left his free-market reforms alone because they worked. He also praised Norway for making the austere efforts of becoming a democratic and transparent petro-state. On Venezuela, Frum criticizes the country for attempting to maintain two separate currencies. Even where these systems are very well designed (the South African system was especially ingenious), even where they are enforced by a generally honest and effective civil service (as was the…
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Excerpt: In the hands of very few oligarchs. So much for egalitarianism and meritocracy. A December review by Ernst & Young, for example, found that a mere 98 people control 43% of the voting power on the boards of the 40 companies comprising France’s leading CAC 40 stock index. Not only that, but this dominant corporate core is nearly 80% French — a lopsided percentage, given that nearly 40% of the capital in those businesses is owned by foreign investors. The elite traditionally comes from the French version of Ivy Leagues/Oxbridge, its grandes écoles. Various studies show that the student intake to the grandes…
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Excerpt: I love this comparison of Cuba against the rest of the region, effectively pitting two systems against each other. It is eerily similar to the equality versus fairness argument on a micro scale, and stretched to the extremes. The authors asks: Comparing the two political and social systems also reminds us that for many people in the world, a truly fulfilling life is unattainable. In this vale of tears there must be compromises – but which are the right ones to make? Cubans enjoy an existence free of the kind of violence and neglect their neighbours deal with on a daily basis. While…
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Excerpt: Private consumption in China is one of the lowest in the world. The majority of spending from the public sector goes to infrastructure development and state assets. And private spending is curtailed, since families must make provisions for private insurance, healthcare and retirement savings. So with a more bottom-up approach to development, is India in a better position to spend? If one compares the urban-rural disparity between the two countries, India seems to be in a much more favourable position. The rural half of China is falling behind. Back in the mid-1980s, the mainland’s urban-rural income ratio was 1.8. It now stands at…
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Excerpt: Image by United Nations Photo via Flickr You can’t. And that seems to be a lessons learned from Copenhagen climate talks for the American representative. “The UN didn’t manage the conference that well,” Pershing said. “I am not sure that any of us are particularly confident that the UN managing the near-term financing is the right way to go.” “It is impossible to imagine a global agreement in place that doesn’t essentially have a global buy-in. There aren’t other institutions beside the UN that have that,” Pershing said. “But it is also impossible to imagine a negotiation of enormous complexity…
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Excerpt:
Cover of The End of History and the Last Man
investoralist: Chuck, Thanks for not giving up on it! 
Chuck: Glad to see you posting again. 
ParisGirl111: This is so true. All this time I thought my smarts were my ticket. I realized its... 
jasoncornish: I have been interested in North Korea for many years, it is the... 
Scott: Actually this article is misleading. The Danes are a very closed society of... 
