Commentary on Political Economy

Friday, 30 September 2022

Italy and Sweden show why Biden must fix the immigration system

Opinion by Fareed Zakaria

September 30, 2022 at 7:54 Sydney Time

Italy and Sweden are about as different as two European countries can get. One is Catholic, Mediterranean, sunny and chaotic; the other Protestant, northern, chilly and ordered. Over the decades, they have had very different political trajectories. But now, both are witnessing the striking rise of parties that have some connections to fascism.

In each country, this rise has coincided with a collapse of support for the center-left. And it all centers on an issue that the Biden administration would do well to take very seriously: immigration.

Giorgia Meloni, likely the next prime minister of Italy, is a charismatic 45-year-old politician. Her campaign was a familiar attack on the forces of globalization and a comforting story that she would somehow bring back the good old days before George Soros ruined everything.

In a video that went viral, she says she is proud of all things that the globalists want you to be ashamed of — being Christian, a mother, Italian, etc. And a big part of her policy program is immigration. “Nations only exist if there are borders and those are defended,” she says, promising a naval blockade if that is what it takes to stop the flow of illegal migrants from the Mediterranean.

The appeal of the far-right Sweden Democrats also centers on immigration. The party talks a great deal about the rise of crime, gang violence and abuse of the country’s generous welfare state. But its main campaign proposal was a 30-point plan designed to turn Sweden, which has arguably one of the most generous immigration systems in Europe, into the most restrictive. It is "time to put Sweden first,” says Jimmie Akesson, the dynamic 43-year-old leader of Sweden Democrats.

There is lots of demagoguery in these two politicians and their parties, but there is also an important truth at the heart of their appeal. Immigration in many countries in Europe is out of control.

By “out of control,” I do not mean it is too high. It’s impossible to say what the right number is for any given country. I mean that migration is now largely taking place in a chaotic manner, with massive surges in flows, rampant human smuggling and crime, and a total breakdown of the legal system by which countries evaluate and admit applicants. Sweden’s population is now about 20 percent foreign-born, which is much higher than in the United States, where that number is about 14 percent.

America is different from Europe. American identity is political, while European countries’ national identities, at least historically, have been based on ethnicity, religion and culture. Either way, there are limits to how many people a country can absorb.

About 5 percent of the U.S. population was foreign-born in the 1970s. Since then, that percentage has almost tripled. Even so, people can be convinced that large numbers of outsiders can be assimilated and absorbed. What enrages them is the sense that people no longer become immigrants through a process that the host country controls but rather by crossing the border illegally, claiming asylum status, gaining entry and then simply sticking around. And that fear is justified.

The U.S. asylum system has broken down. It was designed after World War II, in the wake of the Holocaust, to take in people who faced immediate and dire persecution. Today, many people seeking asylum face hardships much like those that have traditionally led people to seek a better life here: poverty, crime, disease, dislocation. They are deeply deserving of dignity and decent treatment. But anyone claiming asylum for only those reasons is abusing the system in an effort to bypass the normal immigration process.

And that process in the United States is now utterly dysfunctional. It was already clogged and understaffed, and President Donald Trump deliberately jammed it up even more, to the point that routine business visa applications from countries such as India can take months; students cannot enter the United States even after getting scholarships; and work-visa applications now rest on the chance of applicants winning a lottery (literally).

The Biden administration is going into the midterm elections with a strong hand. It could be undone by this one issue. It has found an intelligent way to speed up the consideration of asylum requests, though it feels woefully inadequate to the backlog at hand. There are about 744,000 asylum cases pending.

Biden needs to find a way to demonstrate that his administration is taking control of immigration in general and the border in particular. Then he can propose the obvious compromise that could appeal to most Americans: a better, faster, more predictable legal immigration system but a tougher, more effective way to restrict illegal immigration. Or else, the populist right will use this issue to keep gaining ground in the United States just as it has in Italy and Sweden.

Putin Is Trying to Outcrazy the West

Sept. 30, 2022

Credit...Agence France-Presse — Getty Images

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Thomas L. Friedman

By Thomas L. Friedman

Opinion Columnist

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With his annexation of parts of Ukraine on Friday, Vladimir Putin has set in motion forces that are turning Russia into a giant North Korea. It will be a paranoid, angry, isolated state, but unlike North Korea, the Russian version will be spread over 11 time zones — from the Arctic Sea to the Black Sea and from the edge of free Europe to the edge of Alaska — with thousands of nuclear warheads.

I have known a Russia that was strong, menacing, but stable — called the Soviet Union. I have known a Russia that was hopeful, potentially transitioning to democracy under Mikhail Gorbachev, Boris Yeltsin and even the younger Putin. I have known a Russia that was a “bad boy” under an older Putin, hacking America, poisoning opposition figures, but still a stable, reliable oil exporter and occasional security partner with the U.S. when we needed Moscow’s help in a pinch.

But none of us have ever known the Russia that a now desperate, back-against-the-wall Putin seems hellbent on delivering — a pariah Russia; a big, humiliated Russia; a Russia that has sent many of its most talented engineers, programmers and scientists fleeing through any exit they can find. This would be a Russia that has already lost so many trading partners that it can survive only as an oil and natural gas colony of China, a Russia that is a failed state, spewing out instability from every pore.

Such a Russia would not be just a geopolitical threat. It would be a human tragedy of mammoth proportions. Putin’s North Koreanization of Russia is turning a country that once gave the world some of its most renowned authors, composers, musicians and scientists into a nation more adept at making potato chips than microchips, more famous for its poisoned underwear than its haute couture and more focused on unlocking its underground reservoirs of gas and oil than on its aboveground reservoirs of human genius and creativity. The whole world is diminished by Putin’s diminishing of Russia.

But with Friday’s annexation, it’s hard to see any other outcome as long as Putin is in power. Why? Game theorist Thomas Schelling famously suggested that if you are playing chicken with another driver, the best way to win — the best way to get the other driver to swerve out of the way first — is if before the game starts you very conspicuously unscrew your steering wheel and throw it out the window. Message to the other driver: I’d love to get out of the way, but I can’t control my car anymore. You better swerve!

Trying to always outcrazy your opponent is a North Korean specialty. Now, Putin has adopted it, announcing with great fanfare that Russia is annexing four Ukrainian regions: Luhansk and Donetsk, the two Russian-backed regions where pro-Putin forces have been fighting Kyiv since 2014, and Kherson and Zaporizhzhia, which have been occupied since shortly after Putin’s invasion in February. In a grand hall of the Kremlin, Putin declared Friday that the residents of these four regions would become Russia’s citizens forever.

What is Putin up to? One can only speculate. Start with his domestic politics. Putin’s base is not the students at Moscow State University. His base is the right-wing nationalists, who have grown increasingly angry at Russia’s military humiliation in Ukraine. To hold their support, Putin may have felt the need to show that, with his reserve call-up and annexation, he is fighting a real war for Mother Russia, not just a vague special military operation.

However, this could also be Putin trying to maneuver a favorable negotiated settlement. I would not be surprised if he soon announces his willingness for a cease-fire — and a willingness to repair pipelines and resume gas shipments to any country ready to recognize Russia’s annexation.

Putin could then claim to his nationalist base that he got something for his war, even if it was hugely expensive, and now he’s content to stop. There is just one problem: Putin does not actually control all the territory he is annexing.

That means he can’t settle for any deal unless and until he’s driven the Ukrainians out of all the territory he now claims; otherwise he would be surrendering what he just made into sovereign Russian territory. This could be a very ominous development. Putin’s battered army does not seem capable of seizing more territory and, in fact, seems to be losing more by the day.

By claiming territory that he doesn’t fully control, I fear Putin is painting himself into a corner that he might one day feel he can escape only with a nuclear weapon.

In any event, Putin seems to be daring Kyiv and its Western allies to keep the war going into winter — when natural gas supplies in Europe will be constrained and prices could be astronomical — to recover territories, some of which his Ukrainian proxies have had under Russia’s influence since 2014.

Will Ukraine and the West swerve? Will they plug their noses and do a dirty deal with Putin to stop his filthy war? Or will Ukraine and the West take him on, head-on, by insisting that Putin get no territorial achievement out of this war, so we uphold the principle of the inadmissibility of seizing territory by force?

Do not be fooled: There will be pressure within Europe to swerve and accept such a Putin offer. That is surely Putin’s aim — to divide the Western alliance and walk away with a face-saving “victory.”

But there is another short-term risk for Putin. If the West doesn’t swerve, doesn’t opt for a deal with him, but instead doubles down with more arms and financial aid for Ukraine, there is a chance that Putin’s army will collapse.

That is unpredictable. But here is what is totally predictable: A dynamic is now in place that will push Putin’s Russia even more toward the North Korea model. It starts with Putin’s decision to cut off most natural gas supplies to Western Europe.

There is only one cardinal sin in the energy business: Never, ever, ever make yourself an unreliable supplier. No one will ever trust you again. Putin has made himself an unreliable supplier to some of his oldest and best customers, starting with Germany and much of the European Union. They are all now looking for alternative, long-term supplies of natural gas and building more renewable power.

It will take two to three years for the new pipeline networks coming from the Eastern Mediterranean and liquefied natural gas coming from the United States and North Africa to begin to sustainably replace Russian gas at scale. But when that happens, and when world natural gas supplies increase generally to compensate for the loss of Russia’s gas — and as more renewables come online — Putin could face a real economic challenge. His old customers may still buy some energy from Russia, but they will never rely so totally on Russia again. And China will squeeze him for deep discounts.

In short, Putin is eroding the biggest source — maybe his only source — of sustainable long-term income. At the same time, his illegal annexation of regions of Ukraine guarantees that the Western sanctions on Russia will stay in place, or even accelerate, which will only accelerate Russia’s migration to failed-state status, as more and more Russians with globally marketable skills surely leave.

I celebrate none of this. This is a time for Western leaders to be both tough and smart. They need to know when to swerve and when to make the other guy swerve, and when to leave some dignity out there for the other driver, even if he is behaving with utter disregard for anyone else. It may be that Putin has left us no choice but to learn to live with a Russian North Korea — at least as long as he is in charge. If that is the case, we’ll just have to make the best of it, but the best of it will be a much more unstable world.


Friday, 23 September 2022


Just like the bad old Stalin days, Vladimir Putin’s death list grows


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In the bad old days of Stalin’s Soviet Union, extra-judicial killings were routine. Soviet citizens who found themselves on lists compiled by Stalin’s secret police chief, Lavrentiy Beria, were arrested and simply disappeared.

Putin’s Russia cannot be so bold. Telecommunications in the 21st century demand explanations. Prominent Russians cannot merely vanish.

A week ago, Komsomolskaya Pravda editor-in-chief Vladimir Nikolayevich Sungorkin died suddenly after appearing to suffocate, according to a report in the newspaper he had led. There’s no official cause of death although reports indicated he had suffered a stroke. He was 68 years of age.

 Three days ago, the former head of Moscow Aviation Institute, Anatoly Gerashchenko, died in a fall inside the aerospace institute in the Russian capital. Reports from Russian media claimed Gerashchenko had “fallen from a great height”, clattering down a number of flights of stairs within the MAI. He was pronounced dead at the scene.

I’ve been keeping a list of prominent Russians who have died under suspicious circumstances since Putin’s invasion of Ukraine. The list is by no means complete. There are tales of murder-suicides which at face value are improbable. All are suspect and reek of extra-judicial murder. And it is more than likely that many more, without the profiles of wealth and prominence have suffered similar fates.

On September 16, Aviation Director for Russia’s Far East and Arctic Development Corporation (KRDV), Ivan Pechorin, died in what was reported as a maritime accident, near Vladivostok with reports claiming he had fallen off a boat travelling at high speed. His body was discovered two days later. Pechorin was 39.

READ MORE:Putin ‘in secret plan to mobilise one million men’|UN slams Putin’s nuclear threats|Putin ‘pumping out lies’: Biden

On September 1, the chairman of the board of Russia’s largest private oil company Lukoil, Ravil Maganov, died after falling out of the sixth-storey window at the Moscow Central Clinical Hospital.

 I’ve been keeping a list of prominent Russians who have died under suspicious circumstances since Putin’s invasion of Ukraine. The list is by no means complete. There are tales of murder-suicides which at face value are improbable. All are suspect and reek of extra-judicial murder. And it is more than likely that many more, without the profiles of wealth and prominence have suffered similar fates.

On September 16, Aviation Director for Russia’s Far East and Arctic Development Corporation (KRDV), Ivan Pechorin, died in what was reported as a maritime accident, near Vladivostok with reports claiming he had fallen off a boat travelling at high speed. His body was discovered two days later. Pechorin was 39.

READ MORE:Putin ‘in secret plan to mobilise one million men’|UN slams Putin’s nuclear threats|Putin ‘pumping out lies’: Biden

On September 1, the chairman of the board of Russia’s largest private oil company Lukoil, Ravil Maganov, died after falling out of the sixth-storey window at the Moscow Central Clinical Hospital.The Russian oligarch had called for an end to Russia’s invasion of Ukraine.

Another executive at Lukoil, Alexander Subbotin was found dead in May in circumstances that strain credibility. According to the BBC, Subbotin was found “in the basement of a shaman’s house after consuming snake venom as a hangover cure.” As you do.

In April, a former executive at Novatek a large privately owned LNG producer in Russia, Sergey Protosenya, 55, was found hanged in a villa in Lloret De Mar, Catalonia, Spain, along with the bodies of his wife, Natalya, 53, and 18-year-old daughter, Maria.

The deaths were described as a murder-suicide but Protosenya’s 22-year-old son, Fedor, believes all three were murdered. Sergey Protosenya was known to be a good family man. His wife and daughter had been bludgeoned to death with an axe.

Sergei Protosenya, wife Natalya and teenage daughter Maria were found dead in their Spanish mansion in Lloret de Mar. Picture: social media/east2west news

Sergei Protosenya, wife Natalya and teenage daughter Maria were found dead in their Spanish mansion in Lloret de Mar. Picture: social media/east2west news

On the previous day, Vladislav Avayev, former vice-president of Gazprombank, was found dead in his Moscow apartment along with the bodies of his wife and 13-year-old daughter. The deaths also appeared to be a murder-suicide. All three died of gunshot wounds.

Vasily Melnikov, owner of a company that imports medical equipment into Russia, was found dead in his apartment in Nizhny Novgorod a city 420 kilometres east of Moscow. Melnikov, his wife, and his two sons, aged 10 and four had been stabbed to death. Another murder-suicide pact apparently.

 On February 24, the day Russia’s invasion began, Alexander Tyulyakov, deputy general of the treasury department for Gazprom, was found hanged in the garage of his home in St Petersburg. A note was found with his body leading investigators to conclude that Tyulyakov died by suicide. Tyulyakov was Ukrainian.

Fire brigade members wear green biohazard suits in Salisbury, England, after the attempted murder of Russian former double-agent Sergei Skripal and his daughter. Picture: AFP

Fire brigade members wear green biohazard suits in Salisbury, England, after the attempted murder of Russian former double-agent Sergei Skripal and his daughter. Picture: AFP

There are others, many others that pre-date the invasion. Oligarchs, dissidents, critics. Trip and falls. Poisonings. Many with the visible imprimatur of Putin and the FSB.

The chemical weapon, Novichok, was used by the FSB in an attempt to murder former Russian military intelligence agent, Sergei Skripal and his daughter, Yulia, in Salisbury, England. Both were poisoned but recovered. But the nerve agent had spread, contaminating others. Two British citizens fell ill, one later died.

What does all this tell us? Foremost is that Putin’s Russia holds international law in contempt. The FSB will commit murders on foreign soil just as freely as they will in Russia.

The spate of deaths since the invasion also points to an attempt to silence Putin’s critics. Scrape the surface and the hard man can only survive with the intervention of his secret police.

Moreover, it tells us that Putin is becoming increasingly desperate. This may be good news or it might be terrible. What we can see from his leadership is that he governs without compunction, without honour and without regard for basic human dignity.

Like Stalin, he appears to be incapable of feeling remorse or regret, any form of emotional connection to the world around him.

That makes him a very dangerous man indeed, worse still as he inherited a nuclear weapons stockpile second only to that of the United States and openly threatens to use them.

But now Putin can no longer claim the nonsense of a limited military operation in Ukraine. The announcement of an expansion of troop numbers in Ukraine exposes Putin to a much broader wave of dissent. In the two days since Putin raised the stakes, Russians of fighting age have headed to the Georgian border, the one country Russians can escape to without a visa.

And with that looming dissent, Putin will learn, just as Stalin chief Beria discovered, that there are only so many people he can kill before it’s his turn.


Monday, 19 September 2022



{Life expectancy: US exceptionalism}

Life expectancy in the US had stalled even before the pandemic. Despite spending much more on healthcare per capita than other developed countries, Americans live shorter lives than people in France, the UK and even Chile.

The coronavirus pandemic has only sharpened the divide. US life expectancy fell from 78.8 years in 2019 to 76.1 in 2021, according to the National Center for Health Statistics. That is the largest two-year decline in almost a century. In France, the fall was half a year. In Japan, the figure rose.

Longevity matters as an indicator of the collective quality of life in a nation. It has big implications for business. Insurers and savings companies build their strategies around the life expectancies of customers.

America’s longstanding problems with obesity and opioids left a portion of its population vulnerable to coronavirus. Almost two-thirds of Americans hospitalised with Covid-19 had at least one pre-existing condition.

The outlook was bleakest for Native Americans and Alaska Natives. Their life expectancy plunged almost seven years from 71.8 in 2019 to 65.2 in 2021, around where the national average stood in 1944. Those statistics reflected the first full year of the pandemic since March 2020, but also poverty and discrimination alongside the high rates of suicide, accidents and addiction which blight marginalised communities.

These days, education is a good gauge of longevity. Research from Anne Case and Angus Deaton of Princeton University found Americans with a university degree could expect to live a decade longer than those who dropped out of high school. This cuts across the race lines. Well-educated black Americans have narrowed the gap with white peers in life expectancy. But the educational divide between and within both race groups has widened.

Between 1990 and 2018, racial disparities in life expectancy shrank by 70 per cent. Educational disparities in longevity more than doubled. During the pandemic, those without a degree suffered from higher mortality rates.

People with tertiary educations were more likely to work remotely from home. They often had comprehensive employer-provided insurance.

Education, poverty and diet go hand in hand. Distributing Covid vaccines is relatively easy. To reverse a crisis of early deaths, policymakers would need to cut poverty, obesity, drug abuse and gun violence. The cultural and political barriers to that are daunting.

America needs a plan on China decoupling

Rana Foroohar

The drumbeat of decoupling between the US and China rose to a crescendo last week as President Joe Biden issued an executive order telling the Committee on Foreign Investment in the US to boost scrutiny of cross-border deals in sensitive areas such as artificial intelligence, quantum computing and biotechnology.

The order didn’t specifically mention China but was clearly part of a growing effort by the White House to separate its supply chains and financial markets from Chinese influence.

Whether or not you agree with the move, or decoupling in general, it’s high time America had a much more complete strategy for how to deal with the reality. US-China tensions have risen to worrisome levels, particularly around the issue of Taiwan.

Last week, the Senate foreign relations committee approved a bill that would provide $6.5bn in direct military assistance to the country, as part of an effort to help the island nation — which produces 92 per cent of the world’s high-end semiconductors — defend its sovereignty.

The path to actually passing the bill and pushing through aid money is unclear. But the move, along with talk of new sanctions against China to deter a potential attack on Taiwan, are pushing geopolitical hot buttons at a time when the US has yet to develop a detailed action plan for the economic fallout from such a conflict, or even the continued decoupling of the US and Chinese economies.

In Washington, fears that Beijing is planning a military invasion are growing, and America is in danger of becoming embroiled in sparring between Beijing and Taipei in the Taiwan Strait. But what would happen if supply chains and financial flows between the US and China were cut off tomorrow? What’s the day-one plan?

Nobody I’ve spoken with in either the public or private sector has a clear and complete answer to that question. The government approach has so far fallen into two categories: a tit-for-tat response to China’s own moves, involving tariffs and sanctions, or a big-picture but still somewhat vague top-down approach about how to rebuild the industrial base at home.

Donald Trump’s administration was mostly about the former.

The Biden administration has made clear it wants to sharpen government focus on protecting national security and building more resilience and redundancy at home, and regionally with partners (“friend-shoring”), in strategic areas such as semiconductors, green batteries, key minerals and pharmaceuticals.

That’s important, and needed. But now both policymakers and businesses need to really drill down to what that means in practice.

What would it mean, for example, if China suddenly stopped shipping key drug ingredients to the US? Is there a full list of what the most important inputs are, which companies use them, where alternative supplies could be located quickly, what percentage of consumption needs they could meet, and how quickly (and at what cost) industry in either the US or allied nations could manufacture new supply?

Likewise, how would the US (and the world) meet chip demand should China invade Taiwan? Would there be a military counterstrike? Is it conceivable that foundries on the island would be destroyed? Are there any plans for which parts of the public and private sector would be prioritised in the event of a major and immediate semiconductor supply shortage?

These are terribly uncomfortable questions, and it’s no surprise that few want to raise them. But they are exactly the ones we need to be asking, particularly given that Chinese leader Xi Jinping — who is likely to be reappointed for a third term at the Communist party congress in mid-October — has made clear that national security, even more than Chinese economic growth, is his top priority.

China would have much to lose if trade and capital flows decoupled quickly. But the US has just as much to lose, if not more, and is less prepared for the possibility.

Beijing is already actively implementing a “Fortress China” strategy to become self-sufficient in the most essential goods and technologies.

The US has said it wants the same. Yet one of the realities of America’s decentralised, privatised economy is that it is difficult to map risk. The Department of Defense may have a grasp on where all the parts of an F-35 fighter jet come from. But I doubt that policymakers understand the totality of the supply chain in even the most important non-defence areas, such as electric vehicles or electronic components.

This is not to say the US should copy Beijing’s top-down approach to economic development — as I’ve argued in past columns, decentralisation is a strength for the US in terms of innovation. But in a decoupling world, it’s not a good idea to raise the security stakes without having a solid plan for what happens if there’s a war, real or economic.

The US should appoint a White House-level resilience tsar (a non-partisan figure with a logistics or business continuity background) — as I’ve also argued previously — to pose the right questions and ensure public and private sector preparedness.

We need a far better understanding of the economic implications of decoupling, whether it happens slowly or suddenly. We must not sound the drums of war without understanding what they may bring.