Katharina Buchholz, writing for Stastista, has written about the distribution of wealth in the US over time, and the evidence confirms that wealth concentration continues in the US. Her analysis is depressing:
“10 percent of the richest people in the United States own almost 70 percent of the country’s total wealth. As of June 2019, the top 10 percent held 69.4 percent of total U.S. net worth (that is the value of all assets a person holds minus all their liabilities).
“The top 1 percent held about half of that wealth – 32.4 percent, while the next 9 percent held approximately another half at 37 percent. The bottom 50 percent of U.S. residents only held about 2 percent of all of U.S. wealth. As recently as 2011, that number was as low as 0.2 percent, caused by the downswing of the Great Recession.
“Looking the development of U.S. wealth distribution since 1989, the rich have in fact gotten richer, with the top 1 percent expanding their wealth share from 24 percent to 32 percent. The next 9 percent has remained steady at 37 percent while the 50-90 percentile has been holding less wealth, 29 percent in 2019 – down from 35 percent in 1989. The bottom 50 percent, after the recession setback, have only now recovered to pre-recession levels.”
The Syrian situation defies analysis. I don’t think I have ever seen such a massive screw-up, and I certainly can’t remember reading about such a miserable situation. It is hard to believe that someone could find humor in such a desperate situation, but the Onion comes through. It would be extraordinarily funny if it weren’t also true.
” AIN ISSA, SYRIA—As they streamed out of detention camps in northern Syria following U.S. withdrawal of military support in the region, jubilant ISIS prisoners on Monday hailed their American liberators. “We never thought we’d see the day when someone would finally stand up for us and free us from the Syrian Democratic Forces’ clutches,” said ISIS member Mohsin Al-Lateef as hundreds of his recently liberated fellow jihadist militants praised President Donald Trump and raised American flags in tribute to their emancipators. “For years, we opposed the United States for their intervention in our lands, but now we see that they strongly believe in our mission to establish a caliphate across our ancient lands and put infidels to death. We will honor the U.S. for not only standing down in support of our fight against the Syrian Kurds but for stoking chaos in the region to give us a chance to regroup and re-emerge stronger than ever before. God bless America!” At press time, President Trump had shared a video of the liberated ISIS prisoners celebrating and thanked them for their support. “
In the rapidly changing strategic situation in Syria, the US has decided to pull all its troops out of northeast Syria. The decision comes as the US forces became entangled in a messy situation with ISIS prisoners being freed, Turkish troops on the move, and Syrian government troops moving into the region. There are no front lines and no defensible positions in the chaos. There are reports that the Kurds have requested Syrian troops to defend them in the absence of US troops, but it is not yet clear whether those Syrian troops will engage the Turkish troops. If those reports are correct, then it is highly likely that Russian forces will provide support for the Syrian troops, boosting the leverage that Russia already has in the region. It is extraordinary how quickly Russia has been able to fill the power vacuum created by the US withdrawal. The Washington Post quotes a Kurdish woman on the strategic shift:
“‘For the regime to intervene and deploy its forces on the Turkish border is a comforting thought,’ said the woman, who gave her name as Nowruz. ‘If a deal with the regime is what it takes to stop these massacres, then so be it. At the end of the day, we are all Syrians, and the regime is Syrian, too.’
“’The Americans betrayed us. We do not trust them anymore,’ she added.”
The US and China have agreed upon a temporary truce in their trade war (or, as President Trump calls it, “Phase I of the Talks“). It is hard to figure out what was actually decided although the US announced that it will not impose the $250 billion of tariffs scheduled to go into effect and China announced that it would buy $50 billion of US agricultural products. The agreement was only verbal so there is no way to determine whether progress has been made on the most nettlesome issues, such a the protection of intellectual property. The pressure on both sides to reach an agreement was intense as both countries fear an economic slowdown:
“Concerns about economic slowdowns pushed both countries toward a deal. The September ISM Manufacturing Report on Business in the U.S. declined to the lowest level in 10 years, with capital spending and exports also treading lower than a year earlier.
“China is facing the prospect of a growth rate below 6% for July through September. Both countries were eager to avoid further damage to their economies.”
The agreement is hardly a breakthrough, but we should hope that the concessions made by both sides indicate a willingness to reach a broader agreement. The two sides will meet again at the Asia-Pacific Economic Cooperation summit in Chile in November.
Jared Bernstein has written a fascinating essay on why market capitalism has failed to address the problem of climate change in the world. Prices should reflect scarcity and it does appear as if a benign environment is becoming less available every day. But Bernstein argues that our awareness of the value of a benign environment is profoundly lacking:
“And yet, there’s a key area where prices fail us every day. They fail us every time you fill up your gas tank: Fossil fuels are severely underpriced.
“What do I mean by that? I mean that fossil fuels are imposing costs on our environment, our economy, and our future that are not being captured by their price.
“That underpricing has consequences. Energy costs are so low and so unresponsive to the environmental challenge we face that they send us a signal to literally keep cruising along, ignoring the pressing reality of climate change.
“How is it that a discipline fundamentally based on scarcity has failed to accurately price in the damage we’re doing to our most important, scarce resource: the environment? Naomi Klein writes that the climate crisis is ‘born of the central fiction on which our economic model is based: that nature is limitless.’
“But I don’t think the economic model fails because it denies scarcity and embraces limitless nature. It fails because of its interaction with two things in particular: 1) our tendency to focus on the present at the expense of the future; and 2) the toxic cycle of profit and influence that distorts policy making and blocks the accurate pricing of carbon.
“This diagnosis matters because we need to either unjam the model and attach a sustainable price on carbon or recognize that politics as currently practiced won’t allow us to do that, in which case we’ll need to figure out other, bolder ways to fight climate change. The Green New Deal may well play a role in that alternative vision.”
This way of looking at climate change divests us of the illusion that there are market-based solutions to the problem of climate change. The solution clearly lies in the political arena, not in the hidden hand of the market. Bernstein is explicit about the real problem which he identifies as the “toxic intersection of capitalism and money in politics.”
President Trump’s decision to pull some US troops out of Syria still remains a puzzle, although we are getting more information about how the decision was made. It seems clear that the President did not consult with his military or diplomatic advisers, but we are learning that the Kurds were not informed either. Newsweek reports:
“Newsweek sources say Washington’s crucial allies in the area, the fighters of Syria’s Kurdish ethnic minority, were blindsided as well.
“‘No one in the U.S. government told us’ about the U.S. decision to reposition troops, or possibly even pull out of northern Syria as Trump suggested, a Kurdish intelligence official tells Newsweek.
“‘When we heard the news of American withdrawals, well, it was over Twitter, we had no idea, we were like, ‘What is this shit?'”
“‘Xi Jinping said that China is concerned about the situation in Kashmir, the rights and wrongs are clear,’ according to the Chinese Foreign Ministry. ‘China supports the Pakistani side in safeguarding its legitimate rights and interests and hopes that the parties will resolve the dispute through peaceful dialogue.'”
The recent shooting at a synagogue in Halle, Germany followed a pattern that has been in play in a number of similar incidents. The shooter live-streamed his activities even though he was not able to enter the synagogue because it was well-locked. The shooter published a “manifesto” which other killers had done as well:
“The Norweigian neo-Nazi who killed 77 people in 2011 wrote a 1,518-page document that has since been cited as an inspiration by other far-right terrorists. That document also contained advice on how to prepare for an attack and select targets. The Australian white nationalist who killed 51 people at two mosques in Christchurch, New Zealand, in March published an 87-page screed before his deadly attack titled “The Great Replacement,” which is the same name as a white nationalist conspiracy theory. The Californian who opened fire on a synagogue in Poway, killing one, also published a manifesto online — as did the man who killed 22 people at a Walmart in El Paso, Texas, in August.”
The virulently anti-semitic views of the shooter were documented in Speigeland unfortunately resonates with a striking rise in anti-semitism throughout the world. The world has yet to take effective action to address this scourge, even though it has plenty of historical evidence to know that it is an incredibly dangerous ideology.
It appears as if US President Trump is going to make the charge that the Democrats favor “socialism” on his campaign for the presidency in 2020. It is not clear that the President has a clear idea of what he means by the term. The Pew Research Center did a poll of American citizens on their feelings about “socialism” and “capitalism”. Interestingly, the Center does not itself define the terms but chooses instead to place both words in quotation marks (air quotes). The results of the poll suggest that the charge of being socialist has lost much of its negative power and that many Americans believe that socialism has some redeeming features. A political campaign is probably the worst situation to have an intelligent discussion about the differences between capitalism and socialism, but it does appear that that discussion needs to take place.
As anticipated, Turkey has launched a military offensive in northeast Syria as US troops have withdrawn from the region. The purpose of the invasion is to dislodge Kurdish forces from the area because Turkey regards the Kurds as a terrorist group intent on supporting an independent Kurdish state. Indeed, the Kurds in the region call the area Rojava (western Kurdistan) and some Kurds that live in Turkey, Syria, Iran, and Iraq have national aspirations as well. There are between 25 and 35 million Kurds making the Kurdish nation one of the world’s largest without a state. The Kurds lost about 10,000 troops fighting alongside the US against ISIS, but the US has little leverage vis-a-vis Turkey now–the US troops withdrawal created a power vacuum which the Turks were willing to exploit. Hemin Kobane is the Syrian Democratic Forces liaison with the international coalition against the Islamic State and he has written an op-ed for the Washington Post on the betrayal of Kurdish forces in Syria. It is a worthwhile read.
US President Trump announced that Turkish President Erdogan will visit the White House sometime next month. The visit is being scheduled in order to redress a diplomatic injury suffered by Erdogan, who wanted to meet with Trump at the UN last month but was told that there was not time in the schedule for a meeting. According to press reports, Erdogan was angry at the slight and communicated his anger to Trump in a telephone call. Apparently, at the spur of the moment, President Trump decided to pacify Erdogan by withdrawing troops. Many analysts, both Democratic and Republican, attacked Mr. Trump for his abandonment of the Kurds. President Trump justified his action, as described by The Washington Post:
“Trump predictably justified his actions not with a strategic vision for a troubled region, but campaign talking points. He told reporters on Monday afternoon that he was following through on what he ‘got elected on’ — in this instance, disentangling the United States from the Middle East’s intractable conflicts. He said it was the responsibility of other countries, including Turkey, to deal with what’s left behind. For good measure, he threatened Ankara with crippling economic sanctions if the Turks did anything ‘outside of what we think is humane.’
It is difficult to determine what Mr. Trump regards as humane given his reluctance to call out Saudi Arabian Crown Prince bin Salman for the horrific murder of Jamal Khashoggi. Or his embrace of North Korean leader Kim despite the well documented atrocities of the North Korean regime. We shall have to see how the Turkish military deals with the Kurds who most likely will seek to make an alliance with Syrian President Assad or Russian President Putin–a profound strategic defeat for the US. We should also keep in mind the rather sordid history of Trump associates such as the first National Security Adviser, Flynn, in their dealings with Turkish President Erdogan.
Trump Towers Istanbul
President Moreno of Ecuador has moved the government out of the capital city as protesters broke through a security cordon surrounding the Parliament building. The protests against the International Monetary Fund’s structural adjustment program which resulted in a 100% increase in fuel oil prices in the oil-rich country. The protests are led primarily by the indigenous peoples of Ecuador who have pressured the three governments in Ecuador to collapse over the past decades.
David Leonhardt has written an op-ed essay entitled “The Rich Really Do Pay Lower Taxes Than You“. The essay has a very revealing graphic which I cannot reproduce here, but I recommend the article. The evidence is quite compelling and it reveals the extraordinary political power of the rich to dictate tax laws that favor their interests. The conclusion is stark: ” For the first time on record, the 400 wealthiest Americans last year paid a lower total tax rate — spanning federal, state and local taxes — than any other income group, according to newly released data.” Leonhardt continues:
“But the second half of the 20th century was mostly a victory for the low-tax side. Companies found ways to take more deductions and dodge taxes. Politicians cut every tax that fell heavily on the wealthy: high-end income taxes, investment taxes, the estate tax and the corporate tax. The justification for doing so was usually that the economy as a whole would benefit.
“The justification turned out to be wrong. The wealthy, and only the wealthy, have done fantastically well over the last several decades. G.D.P. growth has been disappointing, and middle-class income growth even worse.
“The American economy just doesn’t function very well when tax rates on the rich are low and inequality is sky high. It was true in the lead-up to the Great Depression, and it’s been true recently. Which means that raising high-end taxes isn’t about punishing the rich (who, by the way, will still be rich). It’s about creating an economy that works better for the vast majority of Americans.”
This degree of inequality does not serve the long-term interests of the rich. It slows economic growth to stagnant levels and creates political and social tensions–such as suicide, xenophobia, and drug abuse–that are very difficult to manage and expensive to tolerate.
“In a scheduled phone call on Sunday afternoon between President Trump and President Erdogan, Trump said he would withdraw U.S. forces from northern Syria. The phone call was scheduled after Turkey announced it was planning to invade Syria, and hours after Erdogan reinforced his army units at the Syrian-Turkish border and issued his strongest threat to launch a military incursion, according to the National Security Council official to whom Newsweek spoke on condition of anonymity.
“The U.S. withdrawal plays into the hands of the Islamic State group, Damascus and Moscow, and the announcement left Trump’s own Defense Department ‘completely stunned,’ said Pentagon officials. Turkey, like the United States, wants regime change in Syria. Russia and Iran support the Assad regime.
“‘President Trump was definitely out-negotiated and only endorsed the troop withdraw to make it look like we are getting something—but we are not getting something,’ the National Security Council source told Newsweek. ‘The U.S. national security has entered a state of increased danger for decades to come because the president has no spine and that’s the bottom line.'”
” Betrayed by the United States and forced to fight a potentially bloody conflict with Turkey, the Kurdish-led forces could quickly abandon any further effort to control the Islamic State. They might well set free the tens of thousands of former militants and family members held in SDF-controlled camps. The 1,000 U.S. troops in Syria could be forced to withdraw entirely, which would be a major victory for Russia and open the way for Iran to entrench its forces along Israel’s northern border. U.S. allies around the world meanwhile will have reason to question whether they should cooperate with a government that so casually abandons military partners.
“As I have stated strongly before, and just to reiterate, if Turkey does anything that I, in my great and unmatched wisdom, consider to be off limits, I will totally destroy and obliterate the Economy of Turkey (I’ve done before!). They must, with Europe and others, watch over the captured ISIS fighters and families. The U.S. has done far more than anyone could have ever expected, including the capture of 100% of the ISIS Caliphate. It is time now for others in the region, some of great wealth, to protect their own territory. THE USA IS GREAT!”
Mr. Trump’s pomposity is unmatched in the annals of diplomacy.
“To set oneself above intellect is immediately to fall outside it.” ― Plotinus
World politics is waged on many levels and we tend to focus on the most obvious issues. But if you are an iPhone user in China, you will no longer be able to access the emoji for the flag of Taiwan. The change occurred in the most recent Apple update to the iPhone (iOS 13.1.1). China does not recognize Taiwan as an independent country deserving of its own flag. Apparently, Apple agrees.
There have been five days of protests in Iraq, resulting in almost 100 deaths. The political situation in Iraq has never been really stable after the US overthrow of Saddam Hussein in 2003. But the focus on defeating ISIS in Iraq sidelined many of the issues that have caused the recent unrest. The defeat of the territorial-based caliphate has rendered the security situation somewhat more manageable (many ISIS-adherents are still around). The protesters are exercised by corruption in the government and the decided lack of progress in rebuilding the infrastructure of the state. Additionally, the Iraqi nation is still fractured along ethnic and sectarian lines: 60% of the population are Shia Muslims, 20% Sunni Muslims, and 20% Kurds. All these groups have different aspirations and grievances which have so far defied resolution. Patrick Cockburn is a reporter in Iraq and he describes the recent protests:
“It turned out that the government had managed to turn a small demonstration of 3,000 people in Tahrir Square, who had been protesting for three months against official corruption, a lack of jobs and poor services, into a major incident. The protesters had tried to cross the Jumhuriya Bridge which leads in the direction of the green zone, the site of the parliament, the prime minister’s office and other official buildings. The riot police, who have a bad reputation in Iraq, opened fire with rubber bullets, stun grenades, and, eventually, live rounds. Soon a video was flashing around social media of the protesters, mostly under 20, being attacked by the police and hosed with hot water.
“It was this incident which turned a small scale protest into mass demonstrations which may bring down the government of prime minister Adil Abdul-Mahdi. The riot police inadvertently detonated the explosive resentment felt by almost all Iraqis towards the kleptocratic state which has stolen as much as $450bn since the overthrow of Saddam Hussein in 2003.”
The unrest in Iraq raises difficult questions for the US, which relies upon Iraq to act somewhat as a counterweight to Iranian power in the Middle East. Iraq is sympathetic to Iran, but most of the citizenry is also nationalistic and does not regard Iran as a reliable ally (one needs to remember that Iraqis are Arabs and Iranians are Persians).
The US and North Korea began negotiations again in Sweden, but the talks broke off after a day. The negotiations were conducted by North Korea’s Kim Myong Gil and US Special Representative for North Korea Stephen Biegun as a prelude to a hoped-for meeting between US President Trump and North Korean leader Kim. The talks in Sweden were conducted against the back-drop of new ballistic missile tests by North Korea. It was the 11th test by North Korea this year and it was touted as a “new” missile by North Korea. Its range, as indicated by the graphic below, is considerable, raising concerns among North Korea’s neighbors in East Asia. US President Trump still maintains that these tests are not a US concern, but that position is hard to take seriously. South Korea and Japan certainly consider the tests troubling and, if the new missile was launched from a submarine, then it is in range of the US homeland as well. Kim Jong-un has made tremendous progress in developing a serious nuclear capability in the last two years.
World Politics News 