Global News Journal

Cattle Rustling, Pythons and Boogie Angola Style …. the best reads of May

Climate health costs: bug-borne ills, killer heat Tree-munching beetles, malaria-carrying mosquitoes and deer ticks that spread Lyme disease are three living signs that climate change is likely to exact a heavy toll on human health. These pests and others are expanding their ranges in a warming world, which means people who never had to worry about them will have to start.

Spain rearranges furniture as economy sinks

Moving a 17-metre high monument to Christopher Columbus 100 metres down the road is how the Spanish government is interpreting the advice of John Maynard Keynes. The economist once argued it would be preferable to pay workers to dig holes and fill them in again, rather than allowing them to stand idle and deprive the economy of the multiplier effect of their wages.

Picking up the pieces from Afghanistan’s war

U.S. gunners scanned a lush Afghan valley from their helicopter, as a  white van containing a badly burned baby inched toward another Black Hawk waiting at the army outpost. Eight soldiers had flown into the heart of hostile eastern Afghanistan, in a convoy of one air ambulance and one “chase” helicopter for protection, to collect 18-month-old Amanullah who knocked a pot of scalding water over his legs, penis and scrotum.

In Brazil, extreme weather stokes climate worries

No one could say they hadn’t seen it coming. The sand dunes had been advancing for decades before they swallowed the houses of families in Ilha Grande, an island in Brazil’s Parnaiba river delta. Standing on a dune that covers his old home, one man describes the landscape of his childhood — cashew trees as far as he could see. Not a dune in sight.

Speakers’ Corner, Moscow Style?

So President Medevedev would like to create a “Speakers’ Corner” in Central Moscow for Russians to vent their political passions.******”It looks cool,” Medvedev told a group of human rights activists. “I need to speak with the Russian authorities and build our very own Hyde Park.”***Was this just a rhetorical flourish to impress his guests, a signal that he would loosen the reins that his predecessor, Vladimir Putin, has pulled so tight? Free speech, say the rights activists, is not something Russian authorities have prized, whether on the streets or in the media. Would it, could it, work in Moscow? Where ever would you put it in that crowded, bustling city? Who would go there? What would they do there?***Singaporeans, not know for a culture of dissent and protest, have led the way, setting up their own speakers’ corner to protest over economic hardship. Hundreds meet there every Saturday to demand government help. No trouble reported yet.******The London speakers’ corner is held up by some as a symbol of British democracy, a place where anyone can stand on a box and say (more or less) whatever he wants without fear. Yes, in their day, Vladimir Lenin and Karl Marx haunted the place, touting ideas that would have had them dragged away by police in their own countries. Lenin’s wife, Nadezhda Krupskaya, wrote in her memoirs that the Bolshevik leaader was most impressed watching speakers “harangue the passing crowds on diverse themes”. All jolly stuff and not something he himself encouraged when he set up the dictatorship of the proletariat back at home.******These days though, for the most part, London’s speakers’ corner is a gathering place for quirky exhibitionists and comedians, political oddballs of left and right and religious eccentrics of all ilks warning sinful tourists of hell and damnation. The occasional thoughtful soul will read through Shakespeare’s sonnets or expound the virtues of a forgotten philosopher. Heckling seems to be a central part of the fun. A policeman may be at hand in case things turn nasty, but they rarely do.******Possibly, the spot in the north-east corner of Hyde Park was chosen for its closeness to Tyburn gallows where once the condemned would make their last declarations. The Moscow equivalent to Tyburn, I suppose, would be Red Square, where villains were put to death by the axe – though, in the Russian tradition, without those last words. Perhaps, then, Moscow’s Speakers’ Corner might fit nicely nearby at Alexandrov Gardens, at the Kremlin Walls. Arguably, though, a bit too close to***Medvedev’s seat of power. My proposal would be a few hundred metres up Tver Avenue, on Pushkin Square where the Soviet Union once maintained its own bizarre and macabre form of speakers’ corner. Perhaps I should call it the hat-takers-offers corner.******Every Human Rights Day, a keen crowd of journalists and plain-clothes KGB officers would gather in the winter cold around the perimeter of the square named after the great liberal poet Alexander Pushkin. As the hour of eleven approached, a tense hush would descend. A single figure would eventually appear, walk to the centre of the square, stand for a moment, and then take his hat (usually a rabbit-skin ‘shapka’) off; a symbolic protest against the suppression of human rights in the communist state.******In an instant, the KGB officers would swoop down upon him, drag him across the square, bundle him into a van and speed him off to the Lubyanka prison. A few minutes would pass and a second dissident would arrive, take off his hat and stand to attention before being likewise borne away by the forces of order. And so it went on.******Pity though the ‘innocent’ citizen who strayed unwittingly onto the square on that December day, carrying perhaps a magazine or a string bag of potatoes, and found himself suddenly the focus of this hawkeyed gathering. He would break his step and look around, of course, in wonder at his sudden and unexplained celebrity. Me?***That was more enough. Hat or no hat, he followed the rest, bundled into the van and away. It happened, sadly.******Finally, I ask myself who would pitch up at Moscow’s speakers’ corner and in what frame of mind? Memories of the breakup of the Soviet Union, the coups, the civil wars, the anger and the hardship, are still fresh. Economic crisis raises fears of another plunge into uncertainty and the eternal search continues. Kto Vinovat? Who is to blame?******What makes London’s Speakers’ Corner possible, amid all the mockery and sometimes quite pernicious views, is that most people just don’t take it seriously. They laugh, make fun. There may be anger but it knows its bounds. People throw up their hands and walk away, triumphant or humiliated before their peers.******How would Speakers’ Corner take root in Russian soil? Would liberal literati feast on Pushkin and Gogol, while the preachers invoke the fires of hell? Would it become a platform for Muscovites nursing private grievances against uncaring state institutions, the police, big business, the President? Could a Chechen malcontent plant his flag alongside angry nationalists and red-banner waving Stalinists?***Are Russians ready yet to laugh at profanity?

Asian Contagion Redux

    The Indonesian rupiah has lost more than a fifth of its value against the dollar so far this year and on Friday hit its weakest point since August 1998. Authorities swooped in to take over an insolvent Bank Century, the first such takeover since the Asian financial crisis a decade ago.

   Are things in Southeast Asia’s biggest economy really that dire to prompt comparisons with the chaotic events of a decade ago? Today’s financial crisis is draining liquidity from many banks across the world, including in Indonesia.  And as was the case a decade ago, domestic capital is swarming hot on the heels of foreign capital in fleeing Indonesia.

    It is the kind of vicious circle that characterised the”Asian Contagion” crisis of 1997/98. Currencies depreciate. Foreign investors liquidate their portfolios and swarm to the exits. Creditors call in loans, plunging institutions into insolvency. More people take their money and run, further undermining institutions and weakeninging the currency … And so it goes.

    Ten years ago, I was covering South Korea’s fraught journey into near national bankruptcy. (More echoes of the Asian Contagion crisis: The South Korean won hit lows not seen in a decade on Friday and analysts forecast the economy will shrink next year for the first time since 1997). 

    My brother and sister-in-law were in Jakarta, where the financial crisis had morphed into a populist movement aimed at overturning the autocratic regime of the late president Suharto. I had lived in Indonesia in the 1980s and I could hardly believe what was happening in Suharto’s Indonesia.  Food riots swept across Indonesia as the rupiah halved in value in the second half of 1997 — and then halved again in January alone. Panic-buying stripped supermarkets and other stores of their wares.  ”An army of perfectly coiffed Indonesian matrons stormed the supermarkets this week and bought out all the rice, flour, sugar and cooking oil,” my sister-in-law Cynthia Mackie wrote in her diary in mid-January 1998. “The foreigners smelled the panic and got very excited at the idea of their dollars being four times as strong as in July.”

    Suharto was sworn-in for a seventh five-year term after his Golkar party won an incredulous 70 percent of the vote in yet another rigged election of his New Order period.  For years, Indonesians had accepted limits on their political freedoms in exchange for prosperity and growth. Now they had neither. They turned their rage on ethnic Chinese, who though comprising just 5 percent of the population controlled well over half of the domestic economy.

Bailing out Russian oligarchs

Posted by Guy Faulconbridge

Not all of Russia’s rich businessmen are queuing up for a loan under a government rescue package offering billions of dollars in state funds to bail out oligarchs who have been badly hit by the global financial crisis.

Russian billionaires Oleg Deripaska and Mikhail Fridman this week got a total of $6.5 billion in loans from a state-owned bank to help them cover foreign debts secured against stakes in major Russian companies, according to industry sources.

But Alexander Lebedev says there is no reason state money should be used to save oligarchs, the name given to a small group of well connected businessmen who made fortunes in the chaos following the fall of the Soviet Union.

“Why is profit private but the losses put on everyone else? I don’t understand that at all. Why should the rich government save rich citizens. It is not right,” Lebedev told Reuters on the sidelines of an investor conference in Moscow.

“The task of the government is affordable housing, to subsidise mortgages, health and so on but not handing out billions of dollars to certain people,” said Lebedev, a former spy who made a fortune through banking deals in the 1990s.

Lebedev was ranked by Forbes in May as Russia’s 39th richest man with a fortune of $3.1 billion. He  said he had not asked for any help from the government.

“Deja vu all over again” in struggling Hungary?

Hungary has negotiated a $25 billion economic rescue package with the IMF, the EU and the World Bank. What else is new? As that non-Hungarian philosopher of gamesmanship Yogi Berra put it, it’s ”like déjà vu all over again”.  

Consider the words of historian Paul Lendvai who wrote: ”Its economy in tatters, Hungary accepts a loan of 250 million gold crowns.” “Fiscal stability was restored, a currency reform was introduced…and after a modest upswing the value of industrial production stood 12 percent higher…”

The date? The 1920s. The lender: The League of Nations. Only the details have changed.

Hungary seems never to have encountered a global financial crisis it didn’t jump into head first.

Al Qaeda and the financial crisis

The  global financial crisis has become a topic of feverish debate for al Qaeda sympathisers on militant Internet forums.

According to  the U.S.-based SITE Intelligence Group, which monitors  al Qaeda-linked propaganda on the Web and translates it for the benefit of security analysts and counter-terrorism officials, the militant chat rooms have been buzzing for weeks with excited comment.

“Now Sheikh Osama bin Laden has an historic opportunity to crash America completely. Al Qaeda, which has caused America to be ruined economically in Iraq and Afghanistan, has an opportunity to deliver the fatal blow,” wrote a member of a Turkish militant forum recently.  “Al Qaeda could bury America into the landfill of history with an operation similar to or greater than September 11.”

In a discussion on al-Hesbah, a password-protected forum linked to al Qaeda,  one participant gloated that the U.S. economy is “on the precipice”, SITE reported.

He continued: ”Now is a golden opportunity and a gift from Allah that we should not lose. If America is hit now, by Allah, it will never survive, until Allah permits it … I can see that victory is closer than expected.”

Such ”chatter” has attracted the attention of Western intelligence officials. Ernst Uhrlau (pictured), head of Germany’s BND foreign intelligence agency, told Reuters in an interview this week that the financial crisis had emboldened some Islamist militants but it was too early to say if it would help them attract new recruits.

“We’re hearing some first voices on this. Some see the fact that the United States has been so shattered by the financial crisis, and that its dominant role in the world is shaken, as confirmation the West can be beaten,” Uhrlau said.

What will be the shape of the world’s new financial order?

The global financial crisis has produced broad agreement that the world needs a new financial architecture, but world leaders are a long way from reaching agreement on what shape it should take.

Many countries have rescue plans to support banks and unfreeze credit markets. The United States has set in motion reforms to change the relationship between Washington and Wall Street.

But calls are being made for much deeper, coordinated reforms, and a series of global summits is planned to discuss how to reform the financial system. The first of these meetings will be held on Nov. 15 in the United States.

Capitalism as we used to know it may be on its deathbed. Some world leaders have called for a revamp of the 1944 Bretton Woods conference that resulted in the post-World War Two financial order and created the IMF and the World Bank. 

Economists and commentators have been filling newspapers with suggestions about what should be included in the new financial architecture, from more regulation to concerns about climate change and trade.

Some experts say world leaders risk making terrible mistakes of they get it wrong and must stand back and properly assess what went wrong before enacting wholesale reforms. Others say it would be wrong to force one country or region’s vision on another.

There is little doubt we are now, as British Prime Minister Gordon Brown put it, at a “defining moment” for the world economy. But there are more questions than answers.

Where would we be without Europe?

If the financial crisis looks bad, I for one am thinking it might have been even worse — in the euro zone at least — had European countries not decided to pool their economies together by launching the single European currency.

I covered Europe in the 1980s from Belgium and Luxembourg when the idea of a single currency was still the pipe dream of a few old men who back in the 1950s had been inspired by the idea of a united Europe emerging from the rubble of World War Two.

Then in the 1990s,  I was based in Paris when France and Germany, the powerhouse duo of European integration, struggled to align  their economies in preparation for European monetary union. In a smaller version of what is happening now, huge volumes of money washed around Europe’s financial system, as currency dealers bet that the governments of Europe would never be able to pull it off. 

The spending restraints needed to knock economies into shape were hugely unpopular, yet governments — mindful of the competitive devaluations of previous decades — stuck to them in the hope of better days ahead. I remember then Bank of France governor Jean-Claude Trichet patiently explaining to journalists the need for monetary union, so that individual countries were no longer vulnerable to a run on their currencies that would force up interest rates to suffocating levels.

The launch of the euro in 1999 was one of the very rare triumphs of politics over markets.

Looking at what is happening now, the early visionaries of European integration seem remarkably prescient. Or put more directly: If there were no European Central Bank, how many more Icelands would we have inside the euro zone?

Of course, this picture may be too rosy. Europe has struggled to form a coordinated response, as Paul Taylor says in this analysis.  “Since the  credit crunch swept into Europe from the United States last month,” he writes, “European countries have gone their separate ways in rescuing distressed banks, guaranteeing some or all deposits and suspending practices like short-selling shares.”

Trotsky in the night

I’d almost forgotten he was there, in my home. Then came the global economic crisis with its visions of apocalypse, and he caught my eye again, this fiery orator, this ruthless revolutionary killer, the scourge of global capitalism.

His is the first face — hornrimmed glasses, goatee beard — guests might see as I usher them into my living room. My treasured, framed photograph of Lev Davidovich Trotsky posing like some uneasy tourist, cap in hand, before a spreading palm tree in Sochi, commands pride of place. Not that I admire the man.

It was more the circumstances that delivered him to me.

I was working in Moscow, the Soviet Union was collapsing around me. The High and Mighty, Politburo members, so long distant, mysterious figures, were suddenly skittled from power and revealed in once undreamt-of meetings as the banalities most were. While the flesh was discredited, dusty old documents and photographs that had slept disregarded in secret Soviet archives took on a throbbing vitality as archive doors opened to me.

Yellowed paper, tragic, hand-annotated testimonies of men about to be slaughtered, the cruel scribbled jests of their executioners, came alive in my hands; then there was Lev Davidovich’s holiday snap, taken months before he was driven into exile and then bludgeoned to death with an ice axe by one of Stalin’s henchmen. Documents can have a strange power.

Those were the heady days when it was easy to declare the death of socialism, the final triumph of capitalism. New free market economies were set up with a missionary zeal throughout the old Soviet Empire and beyond, from Prague to Beijing. Throughout the world, capitalism was being honed, refined, its brutal bears and wild bulls tamed. A new kind of capitalism.

Finance houses found new ways to handle credit, raise money and spread risk. Markets melded together in the revolutionary global movement my Russian lodger had sought a century ago to make his own.

Financial crisis: What you see depends on where you stand

Depending on where you stand, the financial crisis has been catastrophic or brought a much needed shake out in the financial sector; it has been disastrous for home owners or proved the folly of lending to people with poor credit histories; it has rightly rolled back the clock on naked capitalism or undermined a system that, in essence, functions perfectly well; it has punished bankers’ hubris or thrown many talented individuals out of work.

What you see depends on where you stand.

According to Italy’s economy minister,  Giulio Tremonti, the current economic crisis was the inevitable consequence of policies championed by former Federal Reserve chief Alan Greenspan.

“The mastery turned out to be madness. Alan Greenspan was considered a master. Now it should be asked whether, after Bin Laden, is it not he who has done the most harm to America?”, Tremonti was quoted as saying in an interview with Corriere della Sera newspaper this week.

In an interview with the Wall Street Journal in April, Greenspan hit back at his detractors. “I was praised for things I didn’t do,” he said. “I am now being blamed for things that I didn’t do.”

The debate over what happened and why, who is to blame and where we go from here has sent bloggers and columnists into overdrive. Here are links to some on the UK economy, the Paulson doctrine and AIG and Lehman. There is an argument that the United States’ response to the crisis is evidence of its waning financial power.

Who has got it right?