Austrian authorities have found an abandoned truck with the bodies of more than 70 migrants. The migrants had obviously been assured of passage to Europe by traffickers who, for unknown reasons, sealed up the truck and left the migrants to die. The episode is just another example of how desperate people are being manipulated and abused as they seek safety in Europe. The information became available as another 200 migrants drowned in the Mediterranean as their ships sank. So far this year, almost 300,000 people have crossed the Mediterranean to seek refuge, a significantly higher number than in all of last year. The Washington Post quotes German Chancellor Merkel on the migrant crisis in Europe:
“This reminds us that we must tackle the issue of immigration quickly and in a European spirit,” she said. “That means in a spirit of solidarity — to find solutions.”
I think that European leaders should adopt a more urgent tone in addressing this unfolding tragedy.
Pakistan is rapidly building its arsenal of nuclear weapons and is on track to become the third largest holder of nuclear weapons, after the US and Russia. Pakistan’s nuclear deterrent is aimed at India which is not increasing its number of nuclear weapons at a commensurate rate. The disparity is based on the relative strength of the conventional arsenals available to both: India has a much larger conventional army and Pakistan seeks to compensate for that inequality with nuclear weapons. That strategy is obviously a high-risk one, since, if Pakistan is on the losing end of a conventional war with India, the resort to nuclear weapons as a deterrent has incredible risks for both countries.
China’s economic slowdown has world markets on edge. But it is difficult to assess how dramatic the slowdown may be because many analysts do not believe the Chinese government’s official figures. Economic statistics are invariably dodgy: keeping track of highly complex economic transactions is very difficult and those difficulties are multiplied in a country as large as China. The suspicion, however, that China’s figures are also shaded by political considerations make analysis of the Chinese economy very problematic. The range is incredible. China asserts that its GDP rose 7%; one investment house, Evercore, asserts that Chinese GDP was actually -1.1%
The New York Times has an important story on the difficulties migrants to Europe are facing. The article does a great job of articulating the reasons for migration and the extraordinary obstacles faced by the migrants as they try to enter Europe for a better and safer life.
Violence has broken out in the Gurarat state of India. The violence comes about as Patidar protesters, led by Hardik Patel, mobilize to be recognized officially within the legally recognized caste definitions of Indian law. The Patidars wish to be recognized as an Other Backward Class (OBC). Time describes the classification in this way:
Patel is at the helm of a protest movement aimed at declaring the Patidar community he belongs to — an affluent and politically dominant section of Gujarati society — as “backward” under India’s quota system for its historically lower castes, legally termed as Scheduled Castes (SC), Scheduled Tribes (ST) and Other Backward Classes (OBC). This would give Patidars access to the 50% of government jobs and places in educational institutions currently reserved for such “backward” castes under a form of affirmative action.
The Gujarat government is currently led by Chief Minister Anandiben Patel who argues that the 50% requirement has already been met. At least 9 people have been killed in the violence thus far.
As migrants filter in through Macedonia and Serbia, Hungary is building a fence along its 110 mile border with Serbia in an effort to keep them out. Hungary is part of the Schengen Plan and is viewed by many migrants as the entry point to the European Union. Hungary’s President, Viktor Orban, is unabashedly hostile to the migrants believes that they threaten European identity as well as the European experiment. The migrant crisis continues to defy the competence of the European states.
As the Chinese economy continues to show signs of weakness, the central role of China in the global economy becomes more visible. Unfortunately, some of the countries that will be hurt the most are among the most vulnerable in the world. The Chinese slowdown is having a damaging effect on several African economies as Chinese demand for commodities from Africa tails off.
Turkish President Recep Tayyip Erdogan has called for new elections in hope that his party, the Adalet ve Kalkınma Partisi (AK), will win an outright majority in Parliament. The previous election last June was inconclusive due to the strong showing of the Kurdish party and no coalition was possible to secure a majority. Erdogan hopes that the recent outbreak of violence between the Kurds and Turkish forces, precipitated by the Turkish decision to enter the war against the Islamic State, will dampen the vote for the Kurdish parties, allowing the AK Party to secure an outright majority. The gambit is reasonable, but the recent weakness of the Turkish economy, manifested by sharp declines in the value of the Turkish Lira, may make the strategy more problematic than it seems.
Japanese Prime Minister Shinzo Abe has announced that he will not be attending the celebrations in China noting the 70th anniversary of the end of World War II. Troops from other countries that participated in the war will be represented in the celebrations, but Abe’s decision to not attend represents as serious setback to the tentative steps China and Japan have recently taken to normalize relations. Tensions between the two countries have been steadily escalating over the last five years and there is little evidence that any rapprochement is likely in the near future.
The interdependence of the global economy was obvious today as stock markets around the world fell sharply. Much of the selling was due to fears about a slowdown in the Chinese economy that has caused commodity prices around the world to fall. Many economies rely heavily on the sale of commodities and the loss of the Chinese market will cause slowdowns in every region of the world. Stock markets have been quite ebullient for the last five years, so the declines come on top of some rather hefty gains. Nonetheless, the sharpness of the declines today suggest that investors are feeling a slight case of panic–always a dangerous feature of stock market mentalities.
There have been protests in Lebanon since the middle of July. The immediate precipitate for the protests is garbage: it has been piling up in many areas of Beirut since the only landfill for the city was closed since it was filled to capacity. This part of the protests is called the “You Stink” movement. But, as is usually the case with large protests, there are deeper causes, fundamentally rooted in the gridlock of Lebanese politics. Lebanon is running short of cash and may not be able to pay the salaries of its workers and may not even be able to service its international debts. The collapse of such an important country in the Middle East would be highly destabilizing to the region.
Speaking of garbage, researchers are in the Pacific Ocean to assess the Great Pacific Garbage Patch, a concentration of garbage that some believe to be twice the size of the state of Texas. According to the Guardian:
“More than five trillion pieces of plastic, collectively weighing nearly 269,000 tonnes, are floating in the world’s oceans, causing damage throughout the food chain, new research has found.
Data collected by scientists from the US, France, Chile, Australia and New Zealand suggests a minimum of 5.25tn plastic particles in the oceans, most of them “micro plastics” measuring less than 5mm.”
The researchers are exploring ideas on how to capture the plastic and remove it from the oceans. Eventually, that plastic will somehow end up in the food chain unless it is removed.
Researchers have begun to measure what we have long suspected but could never really prove: the link between civil and international violence and the environment. Measurements from space confirm that as civil unrest deepens, the air gets cleaner because there is reduced economic activity. Satellites can actually measure the level of pollution and correlate it with increased unrest. While this particular correlation seems strangely beneficial, the net effects of civil and international unrest are more typically bad for the environment.
Thousands of migrants rushed police lines at the Macedonian border in an attempt to enter Serbia. Once in Serbia, the migrants would have an opportunity to move to other members of the European Union under the terms of the Schengen Plan. The migrants had been waiting for days and were without food, water, and shelter. The police attempted to stop them with stun grenades, but the mass of people was unstoppable. In the Mediterranean, the Italian coast guard rescued almost 3,000 refugees. The pressure on the EU is getting more intense as the situation of the refugees becomes more desperate.
Brazilian President Dilma Rousseff is currently the subject of an impeachment movement as the Brazilian economy sinks slowly into a recession. By far, however, the overwhelming issue in Brazilian politics is the issue of corruption. Rousseff is in her second term and her popularity has declined into single digits. The combination of a weakened economy and a weakened President is deadly as Rousseff is unlikely to be able to take effective steps to stimulate the economy. The global economy needs the emerging market economies like Brazil’s to regain the dynamism to bring global economic growth.
Stock markets all over the world are having a really rough time. It’s been almost 5 years of growth in the markets, so it is not a great surprise. But the global economy is in for a rough ride.
The recent disaster in Tianjin has raised serious questions about environmental safety in China. There have been unsubstantiated reports of high levels of cyanide lingering around the site of the explosion and evidence of massive fish kills in surrounding waters. But there is little question that China must face its environmental protection issues more openly: according to Berkeley Earth, an NGO that has done extensive monitoring of China’s air pollution, breathing Beijing’s air is equivalent to smoking 40 cigarettes a day.
North and South Korea have exchanged artillery fire across the Demilitarized Zone. The North initiated the attacks to protest the joint military maneuvers between South Korea and the US. But both sides have been waging an intense propaganda war that have aggravated tensions. These exchanges are not unusual on the Koran peninsula. Typically, they do not lead to wider conflicts, but every time they happen there is always a danger of one side or the other making a miscalculation or a mistake.
According to the US National Oceanic and Atmospheric Administration (NOAA), July was the warmest month recorded since records started being kept in 1880. According to the Los Angeles Times:
“The new record was fueled by the oceans. Across the globe, the average sea surface temperature in July was 62.85 degrees F, 0.13 degrees higher than the previous monthly record (set in July 2014) and 1.35 degrees higher than the average for the 20th century. All 10 of the hottest months for sea surface temperatures have occurred since April 2014, the NOAA report noted.”
Land temperatures were also very high. The situation is likely to get worse as the el Niño strengthens in the winter.
Greek Prime Minister Alexis Tsipras has resigned in an attempt to form a new government which might give him more support that his bitterly divided party, Syriza. Tsipras has been forced to back down from his earlier hard-line positions vis-a-vis the troika, and many members of his party consider him a traitor. Without solid party support, Tsipras will be unable to govern effectively. He is hoping that new elections will give him a more effective political base. The risk is quite high, but Tsipras likely does not have much of a choice. In a month we will have the decision of the Greek voters.
Emerging markets are one of the most vulnerable of all in the process of globalization. Over the last few years, emerging markets have borrowed much money in dollars, driven by the fact that interest rates in the US are so incredibly low (essentially zero). Now, however, as the Federal Reserve Bank has begun to make noises about “normalizing” interest rates, raising them slightly in order to prevent an outbreak of inflation that could be a result of the easy money policy of the recent past. The threat of higher interest rates, however, has led to a flood of money leaving the emerging markets–a situation that would threaten their stability. The Financial Times has estimated that the outflow of money from the emerging markets into the US has reached $1 trillion–a very dangerous outcome if it persists. Many of these countries will be forced to devalue their currency, a process that has started with China, Vietnam, and Turkey.
The developing el Niño could be the strongest ever recorded (although, to be fair, records only go back to 1950). The temperature of the eastern Pacific along the South American coast rises during an el Niño event with consequences for many other areas of the world. If California is lucky, it will get heavier rains (although those rains will bring the probability of mudslides). Australia and Indonesia will likely experience drought. In the US east, wind shears from the event will most likely minimize the frequency of hurricanes in the Atlantic.
The refugee crisis in Europe affects all states. Bulgaria is trying to cope with a large influx of refugees, but its resources are stretched quite thin. Bulgaria is building a fence (as is Turkey and Hungary) but such efforts merely make the transit of refugees more dangerous, not less likely. Such barriers also increase the ability of traffickers to take advantage of these vulnerable people: a lucrative activity for the traffickers, but a tragedy for the refugees and migrants. Europe has to come up with a more systematic response to this crisis.
Glaciers in the Tian Shan (in Chinese, “Celestial Mountains”) mountain range in Central Asia are melting at a faster rate than glaciers in other parts of the world, and by 2050 these glaciers could be gone. The glaciers currently supply many countries in the region with their only supply of fresh water, and the demise of the glaciers will likely trigger off competition among the states (Kazakhstan, Kyrgyzstan and northwest China) for water. By the middle of the century, access to water will likely be the major cause of conflict in the world.
Tian Shan Mountain Range from Space
Earlier estimates of how many refugees are seeking asylum in Germany appear to have been far too low. New information suggests that Germany is likely to receive nearly 750,000 refugees this year, primarily from Syria, Eritrea and Sudan. The number is shocking for a country of 80 million. But in percentage terms, Sweden is likely to receive a far higher number. Other European countries take in far lower percentages but the more important point is the extent to which people are fleeing desperate conditions in their home countries. Unfortunately, there are many in Germany who resent the refugees and are burning down the facilities made available to house them.
Bernie Sanders has made an impression on American electoral politics, but there is another left-wing politician who is making a mark. Jeremy Corbyn represents a left-wing tradition in British politics that essentially ended during the government of Margaret Thatcher (much as left wing politics in the US died during the coterminous government of Ronald Reagan) and he is making a bid for leadership of the Labour Party. Those who oppose Corbyn fear that he may reintroduce Clause IV of the Labour Party Constitution which reads:
To secure for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution, and exchange, and the best obtainable system of popular administration and control of each industry or service.
Perhaps left-wing politics are making a comeback in the US and Europe.
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