Archive for the ‘World Politics’ Category
Most of the attention on the Panama Papers has been focused on the effects of offshore banking on developed countries. In fact, the countries that suffer the most from this form of tax avoidance are the developing countries. The group, Global Financial Integrity, has estimated that developing countries “lost US$7.8 trillion in illicit financial flows from 2004 through 2013”. That money dwarfs the amount of money those countries receive in development assistance. It is money that these countries can ill-afford.
South African President Jacob Zuma was not impeached on corruption charges by the South African Parliament. The Parliament, dominated by Zuma’s party, the African National Congress, held that the decision of the Constitutional Court that Zuma had in fact violated the constitution was not a “serious” violation of the constitution. The decision not to impeach Zuma is a serious setback for the rule of law in South Africa, and various groups, including many churches, have vowed to lead a campaign to force Zuma’s resignation.
Anti-Semitic incidents in Austria increased by more than 80 percent between 2014 and 2015. The data confirm what has appeared to many observers as a very worrying trend in Europe. Many of these incidents occurred on the internet so it is difficult to identify the perpetrators. But such activity needs to be vigorously addressed by the authorities.
A Mount Holyoke student has written a deeply moving and highly intelligent reflection on what it means to be a minority in societies where tolerance seems to be in short supply. Saltanat Ansari is a junior from Pakistan and her insights into the recent violence in Lahore are those of a mature scholar. The essay was published in Dawn one of Pakistan’s most influential newspapers. We should applaud Saltanat for her commitment to clear analysis in desperate times.
Iceland’s Prime Minister, Sigmundur Davíð Gunnlaugsson, has resigned because of pressure from citizens angry that he apparently disguised his investments in offshore banks to avoid disclosure. He becomes the first public casualty in the Panama Papers scandal. But China has taken steps to prevent any public discussion of the papers by censoring all mention of them in any media source. The censorship has been extensive even though the Papers “show that relatives of at least eight current or former members of China’s top ruling body, the politburo standing committee, possess offshore companies.” Many, however, are wondering out loud about why virtually no Americans have so far been named in the leaks.
The Panama Papers raise the question of what can be done to prevent these legal, but smarmy, activities. The first point we should keep in mind is that there is no necessary reason why the tax code has to allow individuals to disguise their income and wealth. Presumably, the tax code should be written so that every tax payer has the same options as every other tax payer. But offshore banking is only available to individuals with a lot of money (the offshore banks charge huge fees for the privilege of depositing money). Second, we have to keep in mind that tax policies are exclusively reserved for sovereign states–there are no international organizations that have any role in setting tax policies in any state. Thus, states find themselves in competition with other states for individuals to hold their money within their legal authority. The fear is that if a state banned offshore banking, individuals would simply move to states that allowed offshore banking. This competition limits the degree of cooperation whereby states could limit the activity–the only international regulation possible is the regulation allowed by the most lenient state.
The fallout from the publication of the Panama Papers has begun, but it will be a long time before we recognize the full dimensions of the scandal. Many of the memos reproduced do not use names, but only references to some people that are indirect and have to be broken down and traced. Prime Minister Sigmundur Gunnlaugsson has heard calls for his resignation because the memos indicate that he hid millions from discovery in an offshore bank. So far, he has refused to resign: his defense is that avoiding taxes is perfectly legal. Other politicians so far identified in Argentinian President Mauricio Macri, Pakistani Prime Minister Nawaz Sharif, and Russian President Vladimir Putin. This event is a real tipping point. Using offshore banks to avoid taxes is perfectly legal because the laws have been written to make them legal. But these legal loopholes are not available to ordinary people because they require very large investments which most people cannot make. Even if the investments are legal, the massive shift of taxation from the very rich to those who those with more limited means is a morally reprehensible act. Will the governments act to change the laws?
Under the deal forged by German Chancellor Merkel, the European Union, and Turkey, the first refugees in Greece were sent back to Turkey. The deal is that for every refugee admitted to Greece, one would be sent back to Turkey. In return, Turkey gets €6 billion and visa-free travel in the EU for its citizens. The refugee camps in Greece are miserable and tense over the agreement, and most human rights activists believe that the deal violates international law. But the EU believes that it can longer handle the political ramifications of a continued influx of refugees and believes that this deal is the best that can be done.
The US, Australia, and the Philippines have begun an 11-day military exercise in the South China Sea. Apparently, the exercise involves the retaking of a sea-based oil rig from hostile forces, an exercise that could hardly be missed by the Chinese. The challenge to the Chinese claims of maritime sovereignty in the region continues; we will see what the Chinese response to this event will be.
There has been a massive leak of over 11 million documents from a law firm in Panama, Mossack Fonseca, one of the world’s largest providers of offshore banking services. Offshore banking is the primary method of disguising money from tax authorities, but we don’t have much hard information about how much wealth is involved. But one has to be very rich to afford such services, so the method is usually used by very rich individuals or corporations. The leak of these documents, known as the Panama Papers in the media, is the first solid evidence we have had about the process. The papers indicate that very prominent politicians–in Iceland, Russia, China, and other countries–have used the method to cover up massive corruption. There appears to be no one we can trust.
We have a very difficult time assessing the well-being of people who live outside of the economic mainstream. We can gather incredible amounts of data on people who interact frequently in the market place: we know how much money they have, what preferences they have, how much they save, and so forth. But the poor are significantly more strategic in how they interact with the economy: they tend to live in places that don’t have a lot of access to electricity, computers, and all the other devices that automatically generate information. This difficulty, however, is creating tremendous opportunities for those who are gifted in the analysis of “big” data. By using clever metrics on unusual interactions gathered by satellites and other ubiquitous devices, we are getting a better grip on those who are forced to live in the shadows.
The US is contemplating a dramatic increase in the number of ground troops it currently maintains in Syria. Even though US President Obama has repeatedly said he would not send combat troops to Syria, the US is finding it necessary to develop stronger ties with Arab forces in Syria. Its main ally in Syria, the Kurds, is usually mistrusted by Arab populations, and the US believes that only with a stronger Arab forces can Daesh (the Islamic State) be defeated. The stealth build-up of combat troops is worrisome.
Heavy fighting has broken out in the region of Nagorno-Karabakh, an enclave under control of Christian Armenians surrounded by mostly Muslim Azeris in the country of Azerbaijan. The relations between Armeniz and Azerbaijan over the status of Nagorno-Karabakh is long-standing, but became quite volatile after the disintegration of the former Soviet Union of which both countries were a part. A truce was arranged in 1994, but the issue has never been settled, and it is hard to imagine how it could be resolved given the way the borders are currently drawn. At this stage of the violence, it is hard to determine exactly what led to the outbreak, but more information will become available over time.
Wikileaks has published the transcript of a conversation between two IMF officials worrying about the possibility of a Greek sovereign debt default coinciding with the British referendum on exiting the European Union. The IMF has a difficult time justifying giving credit relief to Greece because its official policy is not to lend to countries if they have “unsustainable” debts. So the IMF believes that the European Union has to come up with the money to give to Greece to avoid a debt crisis in June when its debt payments are due. But Germany is very reluctant to lend any more money to Greece because many German citizens do not wish to bail out the Greeks. The transcript quotes Poul Thomsen, the head of the IMF’s European Department as saying:
“What is going to bring it all to a decision point? In the past there has been only one time when the decision has been made and then that was when [the Greeks] were about to run out of money seriously and to default. […] And possibly this is what is going to happen again. In that case, it drags on until July, and clearly the Europeans are not going to have any discussions for a month before the Brexits…”
The idea that the IMF would threaten to pull out of the negotiations as a way of levering Germany to offer Greece additional economic help is hardly diplomatic and places the IMF in a very uncomfortable political role. Needless to say, the Greeks are angry that their possible debt default and all its associated turmoil is the pawn in this power struggle.
These last few months have seen an outpouring of new studies on ice melt caused by climate change. In short, much of the new evidence suggests that rising sea levels are going to be much more extreme than we have assumed in the past, largely becuase of significant underestimates of ice melts on land masses such as Greenland and Antarctica (as opposed to sea ice which, even if it does melt won’t raise sea levels by much. Climate Central has published some interactive maps on how sea rises of 2 feet compare with sea rises of 6 feet on some major American cities. If you are familiar with either Boston or Miami, these maps will look familiar.
Boston
http://www.climatecentral.org/wgts/2016-slr-sliders/upton-boston/index.html?utm_source=ext&utm_medium=embed&utm_campaign=ss-riskzone-sliders-upton
Miami
http://www.climatecentral.org/wgts/2016-slr-sliders/upton-miami/index.html?utm_source=ext&utm_medium=embed&utm_campaign=ss-riskzone-sliders-upton
Turkish President Erdogan is in Washington, DC and it has become clear that US-Turkish relations are not very good. Turkey and Washington disagree on the priorities of enemies and friends. Turkey has decided that Syrian President Assad and the Kurds are less serious enemies than Daesh (the Islamic State). The US regards the Kurds as allies and Assad as a less serious enemy and Daesh as the most serious enemy. Washington also disagrees with Erdogan’s stance toward human rights and its position toward the treatment of Syrian refugees. It is unlikely that the TUrkish-American rift can be healed as long as either Obama or Erdogan remain in office.
The US is beefing up its forces in NATO to signal an increased capability to respond to Russian military moves in Eastern Europe. The US is going to position three combat brigades in Europe along the Russian border, a force of about 4,200 soldiers in addition to the already stationed 62,000 American soldiers in Europe. The move caps off several earlier ones designed to bolster the American presence in Europe in response to Russian moves in Ukraine that are considered quite provocative. The earlier moves were matched by Russia is a clear demonstration of the dynamics of the Security Dilemma. We will see if these additional moves trigger off additional Russian moves.
The fourth Nuclear Security Summit is currently going on in Washington, DC. The conference is dedicated toward enhancing the security of both military and civilian nuclear processes in order to prevent proliferation of nuclear weapons. This year’s conference is marred by the absence of Russia which has refused to participate because of differences over its behavior in Ukraine. It is unlikely that any major decisions will be made at this year’s summit, but ongoing discussions about security of nuclear materials is absolutely essential to future security.
In many of the previous models of climate change, the issue of ice melt in Antarctica has not been a major concern. Ice melting at the poles has not been well-understood, but two UMass researchers have developed a model of ice melt in Antarctica which more closely mathces the historical records of previous periods of global warming. The new model indicates that ice melt is proceeding in a faster manner than has been so far measured, and that the previous models have underestimated the level of sea level rise by about half because of that error. The new research indicates that many coastal cities could be in serious trouble by the end of this century.
Hungarian President Viktor Orban has used inflammatory rhetoric to justify his government’s refusal to go along with the European Union’s refugee proposals. Orban was campaigning in favor of a referendum to be held in Hungary this coming fall that asks the following question: “Do you want the EU to prescribe the mandatory relocation of non-Hungarian citizens to Hungary without the approval of the Hungarian parliament?” Orban claimed that there were 900 “no-go” zones in European cities, where the zones are defined as beyond the control of the central government because of the influx of refugees. The whole notion of “no-go” zones is bogus: there are, and have always been, areas of every city which are more or less dangerous than others. That degree of danger is not remotely related to the number of refugees.
According to a new Reuters/IPSOS Poll, about 63% of the American population believes that torture is “often or sometimes” justified. Given the reaction to recent events, this number is not surprising, but it still remains depressing. People need to think more carefully about what constitutes torture and whether it is at all effective in obtaining information. Most evidence suggests that it is not. But what is unquestionable is that torture degrades the torturer, and destroys the integrity of the country that sanctions it.
Analysts have a difficult time understanding the motivations of those who resort to terror, and an even more difficult time trying to determine the dynamics of a group that espouses the use of terror. S. Alexander Haslam and Stephen D. Reicher have conducted some interesting research on the dynamics of a terrorist organization using some of the insights provided by the Milgram and Zimbardo experiments. Their analysis is provocative and highly enlightening.
The newspaper that is the authoritative voice of the government of North Korea, Rodong Sinmun. ran an editorial that warned the North Korean people that “We may have to go on an arduous march, a time when we will again have to eat the roots of grass.” The government appears to be anticipating very difficult economic times as the new sanctions against the government cut off key sources of export money to the government. The phrasing of the editorial refers to earlier hard times under Kim’s grandfather and father. The people of North Korea deserve far better than what they have received.
The amount of the Arctic covered by sea ice last winter was the lowest ever recorded (to be fair, records only date back 37 years). The average sea ice coverage from 1981-2010 was about 6 million square miles; last winter it was about 5.6 million square miles. While it is clear that the Arctic is changing, what is not clear is what effect those changes might have on the planet as a whole. There are genuine uncertainties about what a warmer Arctic might mean for the rest of us, although it is a disaster for those who live in the Arctic year round, like polar bears.
The Brazilian Democratic Movement Party (PMDB) has pulled out of the ruling coalition in the Brazilian Congress. The move makes it more likely that President Dilma Rousseff might be impeached as her Congressional support weakens. Although she has yet to be directly linked to the corruption that seems to be pervasive within the Brazilian government, it seems clear that she is suffering from the bad behavior of her colleagues. The PMDB departure leaves the Brazilian government in disarray, not a good situation for the world’s seventh largest economy.
Political violence in Burundi has continued unabated since the election last July of President Nkurunziza to an unconstitutional third term. Despite the intervention of the African Union and the United Nations, as well as many non-governmental organizations, the government continues to hunt down those who oppose Nkurunziza. Civil strife is, unfortunately, not a stranger to Burundi and there are legitimate fears that another civil war could be brewing. This time, however, the attention of the world is focused on refugees from other areas of the world, and the situation in Burundi has not gotten much attention at all.
World Politics News 