World Politics News   Articles for World Politics Course

China released its first public Chinese Military Strategy white paper outlining a new policy of “active defense”.   The document outlines a more active (some would use the word “aggressive”) use of naval power to protect Chinese national maritime interests.   Global Times, a newspaper representing the official Chinese government point of view, described the situation in these terms:

“….it warned of China’s maritime rights and interests. ‘Some of its offshore neighbors take provocative actions and reinforce their military presence on China’s reefs and islands that they have illegally occupied.’  It also warned that ‘some external countries are also busy meddling in South China Sea affairs [and] a tiny few maintain constant, close-in air and sea surveillance and reconnaissance against China.'”

The paper is a blunt warning to the countries of East and Southeast Asia that China intends to back up its territorial claims in the South china Sea with military power.  These countries are looking to the US to protect freedom of navigation in the Sea.

The IMF has issued a new paper which attempts to assess how much the world subsidizes the consumption of fossil fuels.  The IMF estimates are mind-boggling even for those of us who believed the subsidies were large. The key findings of the paper are as follows:

 Post-tax energy subsidies are dramatically higher than previously estimated—$4.9 trillion (6.5 percent of global GDP) in 2013, and projected to reach $5.3 trillion (6.5 percent of global GDP) in 2015.

 Post-tax subsidies are large and pervasive in both advanced and developing economies and among oil-producing and non-oil-producing countries alike. But these subsidies are especially large (about 13–18 percent) relative to GDP in Emerging and Developing Asia, the Middle East, North Africa, and Pakistan (MENAP), and the Commonwealth of Independent States (CIS)

 Among different energy products, coal accounts for the biggest subsidies, given its high environmental damage and because (unlike for road fuels) no country imposes meaningful excises on its consumption.

 Most energy subsidies arise from the failure to adequately charge for the cost of domestic environmental damage—only about one-quarter of the total is from climate change—so unilateral reform of energy subsidies is mostly in countries’ own interests, although global coordination could strengthen such efforts.

 The fiscal, environmental, and welfare impacts of energy subsidy reform are potentially enormous. Eliminating post-tax subsidies in 2015 could raise government revenue by $2.9 trillion (3.6 percent of global GDP), cut global CO2 emissions by more than 20 percent, and cut pre-mature air pollution deaths by more than half. After allowing for the higher energy costs faced by consumers, this action would raise global economic welfare by $1.8 trillion (2.2 percent of global GDP).

Global Post published this graphic from the paper.

The Greek Finance Minister, Yanis Varoufakis, was sidelined after the dust-up with the troika in Riga.  But that has not prevented him from articulating his point of view.  He has written a very straightforward op-ed criticizing the austerity programs being forced upon Greece.  His most salient argument is that the austerity policies will do absolutely nothing to improve Greece’s ability to repay its debts.