Commentary on Political Economy

Thursday 31 December 2020

THE SHIP OF FOOLS - Fear infects the once-proud West.

 These are the lyrics to John Cale's "Ship of Fools". It was 1974, the album was titled "Fear", just as John Lennon was composing "Scared" in "Walls and Bridges". It has taken this long for us to get there, but finally, inevitably, we did. This was always the destination of the capitalist West - its destiny (Geschicht), its history (Geschichte), its "present" (Geschenkt), its "gift". The destruction of the environment that capitalist overpopulation and overconsumption engender as necessary tendencies of its social relations of production lead gradually but inexorably to a turning of the tables. It used to be the case that the advanced industrial capitalist societies dictated terms to "the Third World", which it used as a dumping ground for its imperialist failed and aspiring leaders whom it dispatched far and wide to the remotest corners of the world, as a breeding ground of cheap labour, as a quarry for its prime materials, and as a rubbish heap for its refuse. Now the tables have turned: the Third World takes its revenge across the biosphere. Those diseases, viruses, illnesses that could be confined comfortably "over there" travel seamlessly like Shakespearean "sightless couriers of the air" to punish the hubris of this senseless Zivilisation that long ago defiled and relinquished its Kultur. The tables have turned: the ship of fools is in port, has docked. It carries with it Dracula and his rats infected with bubonic plague - just in time for Christmas...and the new year...

Ship of Fools

The Ship of Fools is coming in
Take me off I've got to eat
Same old stories same old thing
Letting out and pulling in
Mister, there's a caravan parked out back
Restless hoping for a Christian rider
The black book, a grappling hook
A hangman's noose on a burnt out tree
Guess we must be getting close to Tombstone
The last time we had eaten
Was when the flies were going for free
You could count the hardships by the open doors
But sandwiched in between
Were the fishermen who still
Wished they could sail from Tenessee to Arizona
So hold on, won't be long
The call is on the line
Hold on, Sister's gone
South to give the sign
We picked up Dracula in Memphis
It was just about the break of day
And then hastily prayed for out souls to be saved
There was something in the air that made us kind of weary
By the time we got to Swansea it was getting dark
Tumble, jungles, bugles and the prize
The tides turned west at Amerforth
As if they didn't know what to do
But Garnant stood its ground and asked for more
All the people seemed quite glad to see us
Shaking hands and smiling like the clock
Well we gave them all the message then
That the Ship of Fools was in
Make sure they get home for Christmas
So hold on, won't be long
The call is on the line
So hold on, Sister's gone
South to give the sign



Doctors in England despair over disregard for Covid restrictions

Hospital staff express frustration as they tell of reckless behaviour by some members of the public

A coronavirus sign in Westminster, London
A coronavirus sign in Westminster, London. Photograph: Yui Mok/PA

“If people clapped for us now, excuse my language but I would probably just tell them to fuck off,” said the exhausted junior doctor facing January in Britain on an overcrowded intensive care unit. “The majority of people, even people I know who are supposed to be sensible, are all doing things they shouldn’t be and still bubbling with their 80-year-old mother. It feels like almost everyone is breaking the rules in a dangerous way.”

The doctor, who asked not to be named, was training in a hospital in the West Midlands. Like many medics she said she felt increasingly frustrated at the behaviour of people who might have applauded the NHS on their doorsteps in the spring. It had been a hard year watching patients struggle for breath and, ultimately, life.

“It’s not just elderly people, but people in their 50s, people in their 30s with no comorbidities, who haven’t made it,” she said. ‘“We’ve had two pregnant women in ICU. We had one couple come in, neither were that old but both very ill, and I had to tell one of them that their partner had died. It has been really tough.”

The West Midlands, like much of England, is now in tier 4, the highest level of coronavirus restrictions. Yet outside the hospital, she said, too many people were behaving recklessly.

“I cannot go to the shops because it makes me so upset and so angry. I needed milk the other day and I didn’t get it because I couldn’t face going into the shop near me – seeing people without masks on and with their masks around their chins just drives me mad. It feels like a complete slap in the face.”

In London, Hugh Montgomery, a professor who works in intensive care at the Whittington hospital in London, went further. Anyone not social distancing or following the rules had “blood on their hands”, he said.

He told BBC 5 live: “They are spreading this virus. Other people will spread it and people will die. They won’t know they have killed people, but they have.”

In Greater Manchester, also in tier 4, hospital admissions for Covid are creeping back up again. At one emergency department this Thursday a woman in her 90s was admitted. “She’d caught Covid from her family on Christmas Day,” said a consultant, who added that she feared her hospital could be overwhelmed within a few weeks.

Although hospitals in the north-west of England were not yet under the same pressure as their London counterparts, ward space was already running out, said the consultant. Ambulances are backing up, corridors are filling with patients on trolleys and it is becoming increasingly difficult to separate Covid cases from people with other illnesses.

“Our greatest fear is we will become overwhelmed,” the consultant said. “At the moment we are treating everybody. It might not be in the safest, most socially distant way, but if you come in with a serious problem you will be treated and it will be fine, though a few people might get Covid. But it’s getting to the stage where if we have a massive influx of Covid patients our ability to manage that is going to be really seriously compromised.”

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The consultant said she did not mind that people were no longer out on their doorsteps clapping every Thursday to show support for the NHS, but wished they would think more about how their behaviour could affect others.

“People don’t realise or maybe care that what they do as an individual, the risks they are prepared to take, doesn’t just affect them – they think ‘well, it’s up to me’. But they might be asymptomatic and could give it to somebody who could die.”

On Wednesday, she said, she had ducked into a hairdresser for a trim before the shutters came down under tier 4, and was horrified to see how many people were bending the rules. “There were two places doing takeaway food and drink and they were basically running an outdoor bar. It seemed to me everyone where I live was going there, buying alcohol and having a night out. I had to fight my way past literally 15 people, all outside the door of the hairdressers, all without masks on because they were drinking. I was thinking, are you crazy?”

She added: “It might feel nice now but it’s just not caring. I try not to say anything because people are already on edge, but it’s so frustrating. These are people who really should know better.”


La Chine confirme détenir une médecin ouïgoure pour « terrorisme »

Le porte-parole du ministère des affaires étrangères chinois lors d’une conférence de presse à Pékin, le 14 décembre.
Le porte-parole du ministère des affaires étrangères chinois lors d’une conférence de presse à Pékin, le 14 décembre. THOMAS PETER / REUTERS

Le pouvoir chinois a confirmé, jeudi 31 décembre, détenir pour « terrorisme » Gulshan Abbas, une médecin ouïgoure, disparue en détention il y a deux ans. Sa famille aux Etats-Unis venait d’annoncer, la veille, qu’elle avait été condamnée à vingt ans de prison en Chine.

Une information que le porte-parole du ministère des affaires étrangères chinois, Wang Wenbin, a confirmée en ces mots : « Gulshan Abbas a été condamnée en vertu de la loi par les organes judiciaires chinois pour avoir participé au terrorisme organisé, aidé des activités terroristes et sérieusement porté atteinte à l’ordre social. » Selon sa famille, c’est son activisme en faveur de la cause ouïgoure qui serait à l’origine de sa condamnation.

Article réservé à nos abonnés

Comme un avertissement aux dénonciations régulières dont Pékin fait l’objet sur la scène internationale concernant cette communauté musulmane, il a ajouté : « Nous appelons les politiciens américains à respecter les faits, à arrêter de fabriquer des mensonges diffamant la Chine et à s’abstenir d’utiliser la question du Xinjiang [province chinoise dont sont originaires les Ouïgours] pour s’ingérer dans les affaires de la Chine. »

Un traité d’extradition qui inquiète

Le gouvernement chinois a ratifié, samedi 26 décembre, un traité d’extradition avec la Turquie pensant l’utiliser pour accélérer le retour d’Ouïgours exilés dans le pays et soupçonnés de « terrorisme » en Chine. Si la Turquie n’a pas ratifié le traité et a assuré qu’elle ne renverrait pas d’Ouïgours en Chine, l’annonce chinoise a suscité une grande inquiétude parmi les membres de cette communauté musulmane, persécutée dans leur pays.

Article réservé à nos abonnés

Des organisations de défense des droits humains accusent Pékin d’avoir interné au Xinjiang au moins un million de musulmans dans des « camps de rééducation » que la Chine veut appeler « centres de formation professionnelle ».

Selon le témoignage de la sœur de la médecin, Rushan Abbas, Gulshan Abbas, qui parle le mandarin couramment, avait été arrêtée en septembre 2018.


Spies claim China asked mercenaries to attack US troops in Afghanistan

President Trump at Bagram air base in Afghanistan on Thanksgiving Day in 2019
President Trump at Bagram air base in Afghanistan on Thanksgiving Day in 2019

The United States is set to accuse China of offering to pay mercenaries to attack American soldiers in Afghanistan after President Trump received an uncorroborated intelligence briefing on the issue, according to reports.

The intelligence dossier handed to Mr Trump by his national security adviser on December 17 is expected to be declassified. According to the Axios website, it claims that Beijing offered bounties to non-state actors, possibly Taliban fighters, to engage US forces.

Chinese officials have yet to respond but the allegations are likely to worsen the already deeply fractured relationship between Washington and Beijing. The two countries have clashed over trade, the outbreak of the coronavirus and China’s territorial ambitions in the South China Sea.


China Caps Bank Loans to Real Estate to Curb Systematic Risk

Updated on 
  • Banks are given grace period of up to 4 years to implement
  • Move aims to promote property sector’s long-term stability
Under new regulations loans to developers will be capped. 
Under new regulations loans to developers will be capped.  Photographer: Qilai Shen/Bloomberg

China’s regulators will impose caps on banks’ lending to the real estate sector for the first time, in their latest efforts to prevent systematic risks after a series of property curbs in recent years did little to damp buyer enthusiasm.

Under the new mechanism taking effect on Jan 1, 2021, loans to developers will be capped at 40% for the nation’s largest state-owned lenders while banks’ mortgage lending should be no more than 32.5% of their outstanding credit, the People’s Bank of China and the China Banking and Insurance Regulatory Commission said in a joint statement on Thursday. Those exceeding the cap will have a grace period of up to four years to meet the requirements.

The move underscores authorities’ determination to keep a tight rein on the bubble-prone sector and curb leverage at some of the nation’s largest developers. China’s home prices kept rising despite years of regulatory clampdown, stoking social discontent and pushing up financial risks as lenders increased bets on the sector to bolster profits.


China Credit Stress Spreads Wider as Developer Defaults on Bond

China ‘Three Lines’ Debt Curbs May Have Impact Beyond Evergrande

“The new policy is in line with the direction of strengthening supervision and preventing bubbles,” said Chengyu Huang, an investment manager at China Cinda (HK) Holdings Co. “That will further dampen investor sentiment toward the real estate stocks.”

A gauge of Shanghai-listed developer stocks slumped 10% this year, while the benchmark Shanghai Composite Index rallied 14%.

Earlier this year, China’s housing watchdog and central bank have asked 12 developers including China Evergrande Group, Sunac China Holdings Ltd. and China Vanke Co. to report their financing, total debts and business data on the 15th of every month to monitor their financial healthiness.

New home prices rose by 0.12% last month, the slowest pace since February, as wider property curbs cooled demand, prompting developers to cut prices. Still, prices have gained every month since mid 2015.

China home prices have rebounded steadily since the coronavirus outbreak

For now, a renewed fear of missing out on price increases and an urge to guard against anticipated inflation are sustaining housing demand. Credit growth rebounded as monetary-policy easing continues to support the recovery from the pandemic.

Banks will be put into five categories and subject to different ceilings on their loans to developers and home buyers. While most of them had their current real estate exposure within the limits, those failing to comply will face additional capital charges, according to the statement.

The new policy can “help market participants form stable policy expectations, and help promote stable, healthy and sustainable development of the real estate market,” the statement said.


2021: The year of open societies

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Beijing’s growing interference in private economic activity will ‘... stymie its pursuit of global technological leadership’. Picture: Getty Images
Beijing’s growing interference in private economic activity will ‘... stymie its pursuit of global technological leadership’. Picture: Getty Images
  • An hour ago 

“Anno bisesto, anno funesto” — leap year, fatal year — goes an ancient Italian saying, whose origins apparently lie in the devastating plague that hit the Italian city-states in the leap year of 1348.

Then, as in the leap year that has just finished, it was the most autocratic rulers — the Visconti in Milan and the Gonzaga of Mantua — who responded most brutally, and seemingly most effectively, to the epidemic by implementing draconian policies of mandatory isolation, closing public places and prohibiting foreigners from entering the city.

Over the longer term, however, it was not the autocracies but the republics, such as Florence and Venice, that best weathered the storm, devising new institutions — from permanent boards of health to sinking funds for managing public debt — that could deal with the epidemic’s enduring consequences.

And precisely because of their willingness to improvise and adapt, they were more creative, prosperous and stable than their autocratic rivals, and hence fundamentally stronger.

Nor was that pattern unusual. Thus, in the late 1820s, when the first in a series of cholera pandemics struck Europe, autocratic Prussia led the way in drawing an immense military cordon — some 300km long and enforced by 60,000 troops — around its eastern borders.

Within Prussia itself, all ­places of public assembly were shut; soldiers were deployed to prevent crowding at shops; the infected were removed from their homes (escorted by a policeman and two guards, each keeping a distance of at least five paces); and anyone who had been in contact with the disease was forcibly confined.

In contrast, liberal Britain’s response was ambivalent, tepid and muddled. Despite sweeping powers, the government was initially reluctant to adopt intrusive measures, especially given the likelihood that it would have to compensate the merchants those measures harmed.

A prominent physician argued that “a little commercial inconvenience is a small price to pay for the chance of immunity”; but the Privy Council prevaricated, citing disagreements among physicians about the nature of cholera as an excuse not to invoke drastic interventions.

Ultimately, however, the British government’s greater democratic legitimacy allowed it to adopt an approach that was both better targeted and more far-reaching than that of the continental autocracies.

By rebuilding, at immense cost, the nation’s urban infrastructure it eliminated the fetid environments that promoted the spread of illnesses.

At the same time, the “Leicester system”, which relied on surveillance by medical practi­tioners to detect and isolate outbreaks, proved more effective at preventing contagion than the blanket restrictions the autocracies had imposed, and helped create the public trust needed for the eventual success of mass voluntary vaccination against infectious diseases.

Moreover, because Britain’s public administration was subject to vigorous public scrutiny, especially after parliamentary questions on notice were introduced in 1835, misuses of power could be exposed and corrected, introducing an element of continuous improvement into the policy process that the continental autocracies lacked.

As Peter Baldwin put it in his magisterial study Contagion and the State in Europe, the result was that “the British solution (proved) more efficient in preventing disease, reaching greater numbers of victims and driving fewer into the epidemiological underground than (were) heavy-handed tactics”, while inflicting less damage to civil liberties and to economic activity.

In short, Britain’s errors and hesitations may have been substantial; they were, however, more than offset by the resilience and adaptability that distinguish open societies.

Obviously, nothing ensures the future will repeat the past. But if the historical record shows anything, it is that while democracies often struggle when they are rocked by crises, they have an unparalleled ability to overcome them.

And although autocracies can deploy force quickly and effectively, their strength is purchased at the price of crippling weaknesses.

Tyrants everywhere are apt to be deified, to impose their standards of truth, to crush all signs of independence and to carry out vast, prophylactic purges. Together, those measures may perpetuate their rule; however, they have never been able to create a society in which innovation and enterprise can durably flourish. And least of all can they encourage the free inquiry and critical self-reflection that are indispensable for adjusting intelligently to a complex and unpredictable world.

As 2021 opens, we therefore run two sets of risks. The first is that of over-estimating the Chinese regime, in much the same way as many Sovietologists over-estimated the Soviet empire’s power, performance and stability.

It is true that the regime’s technical capacity to reach into the daily life of its subjects puts past tyrannies to shame; but from the renewed cult of the personality to the entrenchment of a gerontocracy that is as corrupt as it is stony-faced, its ruling elite increasingly resembles the Soviet Union’s governing caste in the barren Brezhnev years.

Meanwhile, its growing interference in private economic activity can only worsen China’s now decade-long productivity slump and stymie its pursuit of global technological leadership.

The regime may be skilled at acquiring and imitating foreign technologies; but as the race to develop a COVID vaccine shows, it lags far behind science’s rapidly moving frontier. The deeper China’s rift with the West, the harder closing that gap will be.

There is, however, a no less serious risk of losing the self-confidence we desperately need in liberal democracy’s own values and institutions — and perhaps most of all in freedom itself.

That life is nowhere perfect hardly needs to be said; but it has proved, in the past two centuries, much less imperfect in the liberal democracies than anywhere else.

Yet as Shirley Robin Letwin brilliantly explained long ago, liberal democracy’s endurance relies, more significantly than we generally recognise, on those “vigorous virtues” — of citizens who are “self-sufficient, energetic, adventurous and independent minded” — that its own success, in providing greater security from fear than humanity has ever enjoyed, slowly but surely corrodes.

Indeed, never more clearly than in the past year, the liberal democracies have found themselves in the position of the man who, having crawled out on a limb, has occupied himself with sawing it off.

That may have been inevitable; but it is no means inevitable that they will be able to muster the political maturity, self-confidence and determination required to crawl safely back. On the contrary, by demonstrating just how far they are willing to go in cushioning shocks and protecting populations, they have set precedents that are certain to haunt them when the next crisis — whatever its origins or nature — strikes.

“Anno nuovo, vita nuova” — New year, new life — the Italians also say. We can certainly hope so; but erasing 2020’s long shadow will take much more than hope alone.




HK tycoon Lai sent back to jail

Jimmy Lai, centre, arrives at the Court of Final Appeal in Hong Kong on Thursday. Picture: AFP
Jimmy Lai, centre, arrives at the Court of Final Appeal in Hong Kong on Thursday. Picture: AFP
  • By Afp
  • An hour ago 

Hong Kong pro-democracy media tycoon Jimmy Lai has been ordered back to jail as the city’s highest court granted prosecutors an appeal against his bail.

Mr Lai, 73, a vocal Beijing critic, is one of the highest-profile figures charged under a sweeping security law that China imposed on the financial hub in late June to stamp out dissent.

He served 20 days in custody before being granted bail last Wednesday on stringent conditions. He was placed under house arrest and banned from speaking publicly, including on Twitter.

But the Court of Final Appeal on Thursday granted the prosecution leave to appeal the bail decision, after they said a lower judge may “have erred in his construction or application” of Article 42 in the new legislation.

That article states that no bail should be granted unless the judge sees sufficient grounds to believe the defendant will not commit the offence again.

“We have held that it is reasonably arguable that the Judge’s decision was erroneous and that his order admitting the respondent to bail was invalid,” a determination handed down from the Court of Final Appeal read.

The appeal will be heard on February 1.