The head of the IMF, Christine Legarde, issued a stern rebuke to Greece, saying that she had greater sympathy for the genuinely poor of the world than for the economic distress of the Greeks. While the statement is, no doubt, true, nothing could be more likely to inflame Greek sentiments against the austerity policies being imposed on them. We’ll see if the comments give a boost to the Radical Left Coalition in the 17 June elections.
2011 was yet another record year for the emissions of CO2, putting the world far behind track on avoiding climate change. While China has made tremendous progress in reducing its carbon intensity, the fact remains that its overall emissions keep on rising. The really depressing fact is that one would have expected emissions to have gone down slightly because of the price of gasoline. Apparently, nothing persuades us to consume less.
All the optimism about the talks with Iran evaporated today, as the talks in Moscow broke down. There was apparently a total unwillingness on both sides to compromise–the Western power’s offer of reinstating trade in aircraft parts was laughable. Iran has made the determination that President Obama will not sanction an attack on Iran until after the November election and made no concessions at all. More talks are scheduled, but it is hard to see the point of further discussions. Unfortunately, the Financial Times ended its article on the negotiations with this sentence:
“And while negotiators await the outcome of the Moscow talks, contingency planning for an attack on Iran’s nuclear facilities is intensifying in the US and Israel.”
The violence in Syria continues with a government attack on the town of Houla. Over 90 people were killed, including 32 children. There were the standard words of outrage emanating from capitals all over the world, but there was no sign of any concrete action. The international failure to act is comparable to the failure to intervene in Rwanda. Fewer people have been killed so far in Syria, but the violence has been going on for over a year.
At a time of tight budgets, military spending is getting a close look. Foreign Policy posted an interesting article about the military value of aircraft carriers–truly one of the most expensive instruments of war ever devised. One wonders if they are worth the expense.
The first round of voting in Egypt has yielded two candidates for a run-off election: the Muslim Brotherhood candidate, Mursi, and a former Mubarak associate, Shafiq. Shafiq takes great pride in being a “strong” leader and has raised concern among more liberal Egyptians. But doubts also remain about the commitment of the Muslim Brotherhood in a secular government. It will be a very tough election.
One of the continuing protests against the policy of austerity has been in Canada, as the government decided to raise fees for university students. The protests have not received a great deal of attention, but, in an attempt to stop them, the Canadian government passed new laws against public protests. Predictably, those laws simply fueled greater protests, and those last night were among the worst so far. I doubt that the government will back down, so I would expect more protests in the short term.
The negotiations between the Western powers and Iran in Baghdad did not yield any breakthrough. But there is an agreement to meet again in Moscow in a month. It is difficult to interpret the impasse since all sides are seemingly adamant. Israeli Prime Minster Netanyahu regards the talks as nothing more than a stalling action, and indicated that Israel might not consider any agreement reached as binding on its policies toward Iran.
There was virtually no good news anywhere for the global economy today. All the signs indicated that China, Europe, and the US were experiencing slowdowns. Europe, in particular, got hammered as investors fled from the euro which has lost 5% of its value in the last three weeks. It seems clear that the EU has decided that Greece must leave the eurozone and everyone is getting ready to withstand that storm. June 17th will decide Greece’s fate–we’ll see if the elections produce a viable government.
Elections are being held in Egypt for the first time in many years. The field of candidates is quite crowded and there is a high likelihood that a run-off election will be necessary sometime in June. But the election pits secularists against religious parties and the entire world will be watching to assess the outcome. Regardless of who wins or loses, the simple act of holding free elections is a major step away from the dictatorship the Egyptian people have suffered under for so many years.
The IAEA talks with Iran in Baghdad have apparently gone far better than expected. We don’t really know the details yet and there is always the chance that the talks will break down, but the tone of optimism is unmistakable. The stumbling block in the past has always been on the issue of IAEA access to the enriching facilities in Iran. The Iranians may only be playing for time, and the P5+1 are willing conspirators to a delay. But the embargo on Iran is clearly hurting the Iranian economy, so there is a reason to think that progress may be occurring.
The Economist has published a highly intriguing essay on the role of human beings in climate change. I recommend the essay for the way it changes the way one thinks about a problem.
Chen Guangcheng has arrived in New York with his wife and two children, after China allowed him to leave the country. Thus ends the initial standoff between the US and China over the issue of human rights: the US has made possible the freedom of a noted activist, and the Chinese have resolved their immediate problem of what do do about his dissent. What remains is the question of how the matter of human rights will be pursued by both sides now. Mr. Chen’s courage is to be applauded, but it is unlikely that his voice will be heard in China now.
There was a large Occupy-like protest in Frankfurt, Germany against austerity measures. Chancellor Merkel’s position has become increasingly isolated, both internally and abroad, although it does not yet appear as if she is changing her insistence on cutting budgets. At the G-8 meeting, it didn’t appear as if there was any change in policy likely, although the eight countries gave strong statements of support for Greece.
Fighting has slowly been increasing in Eastern Congo, as rebel forces have invaded from Uganda. The cycle of violence seemed to be ebbing for a while, but those hopes appear now to be dashed. Central Africa remains the most violent place on the planet, unfortunately. And the international community remains reluctant to exert any great pressure to calm matters down.
I am afraid a lot of the postings for the next few days will be on the economic crisis in Europe. Matters are building to a head as banks are becoming increasingly concerned about the high possibility of a Greek default. Many are convinced that the Greeks will leave the eurozone. That event is not in and of itself a major catastrophe. The concern is that people who have money in Greek banks will send their money out of the country. That flight will lead to the collapse of Greek banks. And the collapse of Greek banks will lead to a run on other European banks. So anxiety is building.
As the fighting in Syria continues, there are a number of different interpretations for the continued inaction by the international community. The Russian press has an interesting take on the situation, one which emphasizes the desire of the US to increase its influence in the region.
The trial of Ratko Mladic is finally underway in the Hague. Mladic is accused of some of the worst atrocities in the Bosnian conflict, including the massacre of men and boys in the town of Srebenica. The trial is long overdue and the world will finally gain some insight into how these atrocities were allowed to happen.
It is amazing how many products so few corporations produce. And most of the time we have no idea who is actually making the products we buy. Link to original source: http://i.imgur.com/k0pv0.jpg
European markets were completely rattled today, as talk of a Greek departure from the eurozone (or “Grexit” as the newspapers are calling it) increased in intensity. The apparent collapse of coalition talks in Greece, the spike in interest rates for Spanish and Italian bonds, and the electoral defeats of the major parties pushing for more austerity all signaled a belief that nothing could save Greece. It appears as if the exit is only a matter of months. Whether it unravels the global markets really depends on whether panic can be avoided, and that depends on the emergence of a clear and solid plan to control the contagion of indebtedness.
The Palestinians on a hunger strike in Israeli prisons have agreed to end their strike in return for a change in the terms of their confinement. Most importantly, the Israelis have agreed to reconsider the policy of indefinite detention. It is troubling that the Israelis did not definitively promise to end the policy, but we will wait for the final terms of the agreement.
The Washington Post ran an interesting article today about the ways the oil embargo against Iran is being enforced. Some of the techniques are extraordinary, and the cat and mouse game between Iran and the West is quite incredible.
The election cycle in Europe continues and this time it was Angela Merkel’s party which was rebuffed by voters. According to the Financial Times:
“Angela Merkel’s centre-right Christian Democratic Union suffered a bruising defeat on Sunday night in the election of a new parliament in North Rhine-Westphalia, Germany’s most populous state, when the centre-left opposition of Social Democrats and Greens won a clear majority.
“The vote for the CDU slumped to just 26 per cent, according to the first exit polls, by far its worst result in the state in the post-war period, and a serious setback for the German chancellor.”
Merkel herself still remains popular, but austerity as a campaign platform is being defeated all throughout Europe. It also appears as if the effort to create a government in Greece has failed. So we can expect new elections, and the betting is that the new election will bring an anit-austerity party to power.
Americans tend to regard the Taliban as uncivilized, primarily because of their unorthodox fighting techniques and their rejection of the Western ideas of human rights. That assumption is a profound mistake and rests upon a very narrow conception of what it means to be civilized. It is true that most Taliban fighters are illiterate, but most of them can quote thousands of lines of poetry from memory. For the first time, some of this poetry is being made available to English-speaking audiences.
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