Commentary on Political Economy

Sunday 31 December 2023

 Yet another outstanding piece from Professor Michael Pettis on the 'train-wreck' Chinese economy. The central point the Professor makes here focuses on the single greatest flaw in the investment-driven model of industrial development adopted by the Chinese Dictatorship from the very beginning of its project of military-industrial growth and global supremacy. The flaw lies in the simple reality that state-led growth in China has relied overwhelmingly on the export-led growth of industrial capacity without any equilibrating expansion of domestic consumption - to the evident benefit of state-owned enterprises as against workers' incomes.

The result is that once Chinese exports can no longer be absorbed by developed Western economies and the unprofitability of the asset side of investment not "marked to market" is exposed, a large swathe of Chinese investment is no longer profitable and therefore its real market asset value is unable to back up the debts and match the liabilities on the other side of the ledger.

Obviously, this Wile E. Coyote economy must face the inevitable day of reckoning when the entire Ponzi pyramid of credit-fuelled investment collapses.

Again, this striking truth is something Professor Pettis has highlighted for many years, often earning the lampoonery of pundits and experts who ought to have known better! Much to his credit and integrity, the good Professor has stuck to his guns - and his intellectual courage is now being rewarded in spades as the truth, as always, finally emerges from its China-induced concealment.

China’s debt isn’t the problem

It is a symptom of the problem
© PublicDomainPictures/FTAV montage

Michael Pettis is a senior fellow at the Carnegie Endowment and teaches finance at Peking University.

There’s naturally a lot of attention on China’s swelling debt burden, especially after Moody’s cut the outlook on the country’s credit rating based on the “broad downside risks” posed by the borrowing binge.

That’s understandable, given that the IMF in its latest Global Debt Monitor highlighted how China’s overall debt-to-GDP ratio has increased fourfold since the 1980s. It has been particularly rapid over the past decade. Over half of the increase in the entire global economy’s debt-to-GDP ratio since 2008 is solely due to an “unparalleled” rise in China, according to the IMF.

That $47.5tn total debt pile has grown further in 2023, which might mean that China has now finally overtaken the US in debt-to-GDP terms (zoomable version of the table below):

However, the surge in Chinese debt is not itself the problem but rather a symptom of the problem. The real problem is the cumulative but unrecognised losses associated with the misallocation of investment over the past decade into excess property, infrastructure and, increasingly, manufacturing.

This distinction is necessary because much of the discussion on resolving the debt has so far focused on preventing or minimising disruptions in the banking system and on the liability side of balance sheets.

These matter — the way in which liabilities are resolved will drive the distribution of losses to various sectors of the economy — but it’s important to understand that the problems don’t emerge from the liability side of China’s balance sheets. They emerge from the asset side.

That’s because the losses associated with the misallocation of investment over the past 10-15 years were capitalised, rather than recognised. In proper accounting, investment losses are treated as expenses, which result in a reduction of earnings and net capital. If, however, the entity responsible for the investment misallocation is able to avoid recognising the loss by carrying the investment on its balance sheets at cost, it has incorrectly capitalised the losses, ie converted what should have been an expense into a fictitious asset.

The result is that the entity will report higher earnings than it should, along with a higher total value of assets. But this fictitious asset by definition is unable to generate returns, and so it cannot be used to service the debt that funded it. In an economy in which most activity occurs under hard-budget constraints, this is a self-correcting problem. Entities that systematically misallocate investment are forced into bankruptcy, during which the value of assets is written down and the losses recognised and assigned.

But, as the Hungarian economist János Kornai explained many years ago, this process can go on for a very long time if it occurs in sectors of the economy that operate under soft-budget constraints, for example state-owned enterprises, local governments, and highly subsidised manufacturers.

In these cases, state-sponsored access to credit allows non-productive investment to be sustained. And as economic activity shifts to these sectors, the result can be many years of unrecognised investment losses during which both earnings and the recorded value of assets substantially exceed their real values. Because the debt that funds this fictitious investment cannot be serviced by the investment, the longer it goes on, the more debt there is.

But once these soft-budget entities are no longer able — or willing — to roll over and expand the debt, they will then be forced to recognise that the asset side of the balance sheet simply doesn’t generate enough value to service the liability side. Put another way, they will be forced to recognise that the real value of the assets on their balance sheets are less than their recorded value.

That is the real, huge and intractable problem China faces.

As long as local governments were able to increase debt at will, they could invest to meet excessively high GDP growth targets and could avoid recognising the associated investment losses. But once Beijing imposed debt constraints, either the fictitious assets would have to be written down and the costs allocated, or, which is the same thing, the debt would have to be serviced through transfers from other sectors of the economy.

Either way, someone would have to absorb the losses, and as this happens, there are at least three impacts on the economy.

The first impact does not involve the real welfare and value of the economy, but it may be politically embarrassing. It consists of reversing the former artificial boost to income. At the macroeconomic level, this means reversing the former additions to GDP.

The second impact consists of the unwinding of a previous “wealth effect”. Households and other entities that assumed they were wealthier than they actually were tended collectively to spend more than they could have otherwise afforded — in the case of local governments, this included spending on facilities, employees and services. Once they are forced to recognise their reduced wealth, however, they must cut back on spending, with adverse effects on the economy.

The third and most important impact is what finance specialists call “financial distress” costs. In order to protect themselves from being forced directly or indirectly to absorb part of the losses, a wide range of economic actors — workers, middle-class savers, the wealthy, businesses, exporters, banks, and even local governments — will change their behaviour in ways that undermine growth.

Financial distress costs rise with the uncertainty associated with the allocation of losses, and what makes them so severe is that they are often self-reinforcing. As we’ve seen with the correction in China’s property sector, financial distress costs are almost always much higher than anyone expected.

The point is that resolving China’s debt problem is not just about resolving the liability side of the balance sheet. What matters more to the overall economy is that asset-side losses are distributed quickly and in ways that minimise financial distress costs. That is why restructuring liabilities must be about more than protecting the financial system. It must be designed to minimise additional losses.

In China, as in other countries, it is usually not the debt itself that is the main problem. Debt is just a transfer, and does not necessarily entail the assignment of losses. What matters is the value of fictitious assets that back the debt.

That’s why Beijing should focus not just on managing the liability-side consequences of excessive debt in the system but also (and more importantly) on the asset-side consequences. It must recognise the full extent of the losses and move quickly to allocate them in the most economically and politically efficient ways.

Postponing this recognition and focusing mainly on minimising financial disruption, as Japan did in the 1990s, will just increase the overall cost to the economy.

 Finally the US Navy has drawn Houthi blood. With Joe Biden at the helm - an even greater craven faggot cowardly cunt than the black bastard Osama Obama - you would think the Houthis, not the US of A were the world's most powerful military!

If the asinine traitors who lead the West had any guts, balls and blood at all, by now THERE WOULD BE NO HOUTHIS LEFT, in and outside of the Hooters franchise!

US Kills Houthi Rebels After Attack on Maersk Vessel in Red Sea

    Updated on


    The US said it received a second distress call in less than 24 hours from container ship Maersk Hangzhou in the Red Sea, and its helicopters were fired upon by Houthi rebels as it rendered help.

    The Navy helicopters responded with an attack that sunk three boats and killed the rebels, the US Central Command said in a post on X. The second distress call came at 6:30 a.m. Sanaa time on Sunday.

    The US earlier said it shot down two anti-ship ballistic missiles launched by Houthi rebels after a request for assistance by the Singapore-flagged, Denmark-owned container ship. The Maersk Hangzhou had reported being struck by a missile at 8:30 p.m. Sanaa time on Saturday.

    In the second attack, four small boats originating from Yemen got to within 20 meters of the Maersk Hangzhou and attempted to board it, according to the US statement. Helicopters from the USS Eisenhower and USS Gravely responded to the distress call.

    “In the process of issuing verbal calls to the small boats, the small boats fired upon the US helicopters with crew served weapons and small arms,” it said. The fourth boat fled and there was no damage to US personnel or equipment, according to the statement.

    There has been more than 20 attacks by the Houthis on international shipping since Nov. 19. The US and a number of other nations have formed a maritime task force to respond to the Red Sea attacks.












    From the New York Times:

    "To many Ukrainians, the strikes bring home to Russia the kind of suffering that they have endured almost daily for nearly two years..."

    Ukrainian Missile Attack on a Russian City Kills at Least 22, Officials Say

    The bombardment of Belgorod on Saturday, apparently in response to an enormous air assault by Moscow a day earlier, appeared to be the deadliest single attack on Russian soil since the start of the war.

    Video player loading
    Videos verified by The Associated Press, Storyful and The New York Times show smoke and multiple fires in Belgorod, Russia, which the Russian authorities said Ukrainian forces had shelled with missiles and rockets. Credit Credit... Ostorozhno Novosti via Associated Press

    The Russian authorities said on Saturday that a Ukrainian attack on the city of Belgorod had killed at least 22 people and injured nearly 110 others, in what would be the deadliest single assault against a Russian city since the start of the war nearly two years ago.

    Russia’s Defense Ministry said in a statement that Ukraine had hit Belgorod — a regional center of around 330,000 residents about 25 miles north of the Ukrainian border — with two missiles and several rockets, adding that the strike was “indiscriminate.”

    The ministry said that most of the rockets had been shot down, but that some debris had fallen on the city. The Ukrainian government has not officially commented on the Belgorod attack, and Russian claims could not be independently verified.

    The attack seemed to be Ukraine’s response to a massive and deadly Russian air assault against its territory a day earlier, and another sign of Kyiv’s determination to bring the war to Moscow’s doorstep. In his overnight address on Friday, President Volodymyr Zelensky of Ukraine said that his country would continue to “work toward pushing the war back” to “where it came from — home to Russia.”

    Saturday’s attack on Belgorod were quickly followed by what Ukrainian officials said were several Russian strikes against the Ukrainian city of Kharkiv, about 40 miles from Belgorod, in apparent cross-border retaliation.

    The back-to-back assaults underscored how both Moscow and Kyiv remain willing to escalate a war that will most likely mark its two-year anniversary in February, despite Ukraine’s problems with securing Western funding, an increased sense of war fatigue in Russia and enormous casualties on both sides.

    “There will always be an answer for all crimes,” Andriy Yermak, the head of the Ukrainian president’s office, wrote on social media on Saturday, while Russia’s Defense Ministry said that the attack against Belgorod would “not go unpunished.”

    While the details of Saturday’s attack into Russia were not immediately clear, the death toll alone made it noteworthy. Many Russians have held onto a sense of relative normalcy despite the war, but the violence in Belgorod — which explosions have rocked repeatedly over the last two years — shattered that stability.

    A burned out vehicle in belgorod
    A burned out vehicle. Credit... Reuters

    To many Ukrainians, the strikes bring home to Russia the kind of suffering that they have endured almost daily for nearly two years; to many pro-war Russians, they are evidence that Moscow must use even more aggressive tactics in Ukraine.

    The Russian Emergency Situations Ministry posted a video of the aftermath of the bombardment that showed cars on fire, injured people being carried to shelter and broken glass on the city’s buildings. And Russian state television broadcast videos posted by residents of Belgorod that showed plumes of smoke over the city, shattered glass near residential buildings and people lying on pavements — in a striking echo of scenes that unfolded a day before in Ukrainian cities such as Kyiv, Lviv and Dnipro.

    Vyacheslav Gladkov, the governor of the Belgorod region, said that three children were among those killed on Saturday and that a residential area in the city center had been hit.

    An emergency U.N. Security Council meeting convened to discuss the attack, with Ukraine’s Western allies putting the blame squarely on the Kremlin, which started the war. “If Russia wants someone to blame for the deaths of Russians in this war, it should start with President Putin,” the British envoy, Thomas Phipps, told the Council.

    On Friday, the same Council met to address Russia’s assault against Ukrainian cities, with the United States, France and Britain strongly condemning the attack.

    Ukraine has said several times that it does not fear taking the war to Russian territory, and it has previously targeted the Belgorod region with cross-border strikes and even brief ground assaults by Kyiv-backed, anti-Kremlin Russian fighters.

    So far, such attacks have resulted in at least 50 deaths inside Russia, according to the United Nations, as well as the evacuation of a few thousand civilians and minor clashes with the Russian military.

    Paramedics in blue coveralls cover a body in a metallic blanket.
    The attack killed at least 20 people. Credit... Reuters

    Saturday’s strike on Belgorod was in response to Russia’s air assault on Friday against Ukraine, said an official from Ukraine’s intelligence services, who spoke on the condition of anonymity to discuss the matter, adding that only military facilities had been targeted. The assault on Ukraine — one of the largest of the war — killed at least 39 people, wounded about 160 others and hit civilian and military infrastructure.

    Ukrainian rescuers on Saturday were still pulling bodies from the rubble of a factory that was struck in central Kyiv, the capital, according to local authorities.

    And on Saturday evening, the Ukrainian authorities said, Russia launched an assault on Kharkiv, Ukraine’s second largest city, in what appeared to be Russia’s own response to the Ukrainian attack.

    Oleh Syniehubov, the head of the Kharkiv region military administration, said that Russian missiles fired from the Belgorod region targeted the eastern Ukrainian city and that at least 28 people had been injured in the attack. He added that the Russian military struck the city center six times and reported damage to residential buildings, shops and a medical facility.

    Unverified videos and images shared on social media also showed that the Kharkiv Palace Hotel, one of the city’s most popular hotels and a frequent venue for foreign journalists, was hit. Photographs of the aftermath of the attack showed the facade of the building pierced by a huge hole the size of several stories.

    Mr. Syniehubov also said that Russian shelling on a village in the Kharkiv region left three people dead. Their bodies were pulled from the rubble of their destroyed house.

    The back-to-back air assaults on Friday and Saturday come as Ukrainian and Russian troops are bogged down on land in bloody and mostly inconclusive fighting. Moscow has made several advances all along the front in recent weeks, but military experts say its gains are incremental and unlikely to lead to a major breakthrough in the near future.

    Constant Méheut has covered France from the Paris bureau of The Times since 2020. More about Constant Méheut

    Ivan Nechepurenko has been a Times reporter since 2015, covering politics, economics, sports and culture in Russia and the former Soviet republics. He was raised in St. Petersburg, Russia, and in Piatykhatky, Ukraine. More about Ivan Nechepurenko

    Saturday 30 December 2023


    C’è bisogno d’Europa

    30 dicembre 2023
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    6 min

    La frontiera dell’immigrazione: la Ue dovrebbe assumersi il compito di governare il fenomeno, dall’inserimento dei regolari al contrasto dei traffici

    Ma davvero l’Europa, in questa fase storica, non è in grado di fare nulla di più e di meglio del patto di Stabilità? È questo l’unica atto solenne a cui affidiamo la guida dell’Europa negli anni a venire? Proviamo a considerare in primo luogo che cosa sia l’Unione europea. È tante cose naturalmente: il mercato unico, la moneta comune, una complessa architettura istituzionale, una gran mole di norme. Oltre a ciò, è un club di Stati tenuti insieme dai vantaggi che ricavano dall’appartenenza al club e dalla comune consapevolezza di quanto sarebbe costoso (Brexit insegna) andarsene. Nel club ogni governo contratta cercando di ottenere per sé i maggiori benefici possibili. I vantaggi, però, si distribuiscono in modo asimmetrico, dipendono dalla posizione che si occupa nella gerarchia del club.

    Le cose sono più complesse di così ma, per semplificare, possiamo immaginare l’esistenza di due cerchi concentrici. Il cerchio più interno è il «salotto buono», l’élite (qui dimorano gli Stati più forti nonché quelli piccoli ma con i conti in ordine). Nel cerchio più esterno stanno i Paesi più deboli che hanno bassa influenza sul processo decisionale. Nello stesso cerchio esterno ci sono anche quelli che qui da noi vengono chiamati (ma il termine è fuorviante) «sovranisti».

    L’Ungheria di Orbán è un perfetto esempio: si tuona contro la «dittatura di Bruxelles» dalla quale dittatura, però, si pretendono soldi. Il tutto accompagnato da una ferma opposizione a qualunque ipotesi di maggiore integrazione. Si ispirano al principio «prendi i soldi e scappa»(le regole europee lo consentono). Si noti che l’esistenza del gruppo «prendi i soldi e scappa» è un alibi per coloro che stanno nel salotto buono. Anche lì si annidano le resistenze a una maggiore integrazione. Come mostra il divario fra le proposte (che vanno nel senso di più Europa) della Commissione europea e ciò che è disposto ad accettare il governo dello Stato più forte e influente, la Germania. Nonché la «sovranista» Francia.

    E l’Italia? Tradizionalmente, è sempre stata a cavallo fra i due cerchi, con un piede, al caldo, nel salotto buono e un piede, al freddo, nel cerchio esterno. Per i conti in disordine, la tradizionale debolezza delle sue leadership di governo, l’instabilità endemica. Troppo importante dal punto di vista economico per essere buttata fuori dal salotto buono. Troppo debole per poterne fare parte a pieno titolo. E oggi? Dal suo insediamento fino alla attuale battuta d’arresto ( l’affondamento parlamentare del Mes), il governo Meloni si era mosso con pragmatismo. Se Mario Draghi aveva fatto dell’Italia un membro, senza le solite riserve, del salotto buono, non supinamente a rimorchio di Germania e Francia, Giorgia Meloni, sulla sua scia, stava difendendo bene la posizione acquisita. L’inatteso ritorno dell’ideologia nella vicenda Mes sembra avere riportato l’Italia nella scomoda posizione di chi sta a cavallo fra i due cerchi. Vedremo quali saranno le prossime mosse.

    Se questi fossero tempi poco turbolenti si potrebbe concludere che per qualunque membro dell’Unione la massima aspirazione dovrebbe essere quella di stare dentro il salotto buono. Ma in tempi turbolenti, con guerre davanti all’uscio di casa,in una fase di accelerata ridistribuzione del potere internazionale, non è più così. C’è una tempesta in atto e alla nave servirebbe avere qualcuno nella cabina di comando che stabilisca la rotta. Il contrario di ciò che sta accadendo. Il patto di Stabilità può rassicurare temporaneamente i mercati ma, a dispetto del nome, non può dare stabilità all’Unione se non accompagnato da altre, ben più incisive, decisioni (come ha rilevato Goffredo Buccini, Corriere del 28 dicembre). In questa fase, di fronte a umori anti-europei così diffusi e forti in Europa, servirebbe cercare le strade per correre ai ripari.

    Che succederebbe all’Unione se, complice una gauche che si ispira al principio del «tanto peggio tanto meglio», le prossime elezioni presidenziali francesi le vincesse Marine Le Pen? Che le succederebbe se Alternative für Deutschland, l’estrema destra tedesca, ottenesse il successo elettorale che i sondaggi preannunciano? O se le componenti più pragmatiche della politica italiana (di governo e di opposizione) perdessero posizioni a favore di Salvini e Conte (che siano loro il vero «campo largo»?).Poi servirebbe capire che fare per proteggersi se cambiano gli equilibri internazionali. Che ne sarebbe della sicurezza europea se Trump vincesse le imminenti presidenziali americane? Come la metteremmo con Putin? In tempi tranquilli la politica può essere solo mediazione, negoziazioni e compromessi fra diversi interessi. Tempi felici. Ma ci sono altre fasi nelle quali diventa vitale stabilire la rotta, motivare opinioni pubbliche disorientate, indicare una plausibile direzione di marcia.

    In tempi turbolenti alle autorità si chiede protezione. Se l’Europa non mi protegge non mi serve. È questa diffusa idea che gonfia elettoralmente l’antieuropeismo. Gli antieuropeisti offrono, a modo loro, protezione: dai migranti, con la promessa di chiusura delle frontiere nazionali, dalle minacce esterne, con la proposta di appeasement, di rappacificazione, con i violenti. O l’establishment europeo troverà rapidamente un modo diverso di rispondere alla domanda di protezione oppure il destino dell’Unione sarà presto segnato. Si pensi a come potrebbe essere riassorbita la protesta anti-europea se le venisse tolta la sua principale fonte di alimentazione: la paura e i disagi generati dall’immigrazione. Se fossero le istituzioni europee ad assumersi il compito di governare il fenomeno (in tutti i suoi aspetti: inserimento degli immigrati regolari, contrasto all’immigrazione clandestina,eccetera), disponendo dei mezzi per farlo e mostrando la capacità di farlo in modo realistico e efficace, i contraccolpi positivi, plausibilmente, non mancherebbero. Molti europei ricomincerebbero a pensare che abbia ancora senso scommettere sull’Europa. Lo stesso dicasi se maturasse la scelta di investire in sicurezza spiegando bene agli europei quale sia il vero significato di appeasement: finire dritti in bocca al leone.

    Prevedibile obiezione: la politica è solo l’arte del possibile. Formula ineccepibile. Ma a condizione di non ricavarne l’idea che alla politica bastino i Neville Chamberlain (il premier britannico dei tempi di Monaco), i mediatori. Di null’altro capaci che di sfornare patti di stabilità.

     How ‘Antiracism’ Becomes Antisemitism

    For decades America’s credentialed liberal elite thought of itself as uniquely immune to the appeal of racial bigotry.

    The rest of the country—the right-leaning suburbs, the rural places, the Archie Bunkers—were constantly prone, in the minds of America’s intellectuals and enlightened academics, to indulge in racial grievances. But not the university-educated, well-heeled elite. Not the exponents of mainstream-press conventional wisdom. Not the readers of the New Yorker and the Washington Post.

    Yet here we are. Over the past 2½ months, Jew-hatred has rocked elite college campuses. Tony neighborhoods in blue cities have witnessed marches calling for the elimination of the Jewish state and protests outside Jewish-owned businesses—this in response not to the accidental killing of a Palestinian by an Israeli soldier, but to the systematic butchering and kidnapping of Israeli Jews by terrorists.

    To these expressions of bigotry, high-ranking public officials and university administrators have issued bland disavowals of “violence” and “ hatred in all its forms.” The heads of three top universities, testifying before a congressional committee, couldn’t explain why their institutions prosecute every perceived offense against other minorities but can’t condemn calls for genocide against Jews. The Biden administration itself, though so far pursuing a broadly pro-Israel policy in the Middle East, responded to the rash of antisemitic marches and assaults on Jews by announcing a “National Strategy to Counter Islamophobia.”

    Demonizing people in racial terms because they’re successful turns out to have consequences.

    Past eruptions of antisemitism usually arose from the need to blame someone—anyone—for the cataclysmic failures of a ruling political class. In Russia in the 1880s and ’90s, malcontents equated Jews with Marxists and communists and blamed them for political instability. “The Protocols of the Elders of Zion,” the 1903 forgery purporting to reveal a Jewish conspiracy to rule the globe, was a gift to any people wishing to account for its ruin without self-criticism. Germans after World War I sought a reason for their military humiliation and economic immiseration.

    Palestinian Arabs themselves were carrying out vicious pogroms long before the founding of the Jewish state in 1948—see for example the attack on Hebron in 1929, in which more than 67 Jews, many of them women and children, were murdered. And why? Because the Jews were an easy group to blame: few in number, racially and culturally distinct, highly industrious and successful, and apparently committed to an unsanctioned God. An easy and obvious target.

    So far there have been no pogroms in the U.S., only venomous semiviolent protests, individual assaults, libelous social-media onslaughts and willfully misleading news coverage. But the motivation driving today’s Jew-hatred bears some resemblance to those earlier episodes of antisemitic violence.

    Elite American society has failed in the one aim that gave it definition for more than a half-century: the realization of racial equality.

    The trouble started in the mid-1970s, when the reality became clear that the liberal answer to racial inequality— the modern welfare state inaugurated by the Great Society—wasn’t working. With each passing decade since, black economic improvement has stalled. As Stephen and Abigail Thernstrom make clear in their book “America in Black and White” (1997), the black poverty rate declined dramatically from 1940 to 1960, less dramatically but still significantly from 1960 to 1970, and hardly at all after 1970. Yet decade after decade, the prescription from right-thinking liberals— elected Democrats, social- welfare agency heads, academic experts in urban studies, liberal intellectuals, entertainment-industry glitterati—remains the same: Double down on ’60s-style social-welfare policy, liberalize crime laws, and vilify whites other than themselves.

    The electorate intermittently challenged this orthodoxy. In the 1990s New York Mayor Rudy Giuliani rejected liberal policy prescriptions and brought order to a city long thought ungovernable. Ignoring warnings of apocalypse by the liberal political class, Bill Clinton signed the 1994 crime bill and the 1996 welfare-reform act; both crime and welfare dependency receded. But the orthodoxy always reasserted itself, as it did when Barack Obama expanded Medicaid in 2010 and his allies in the media and intelligentsia demonized governors who resisted that expansion as racists.

    You could chart this cyclical process of doubling down on liberal race orthodoxy by noting a series of abstract words and phrases invented by liberals to excuse the failure of liberal policy on race.

    “Disparate impact,” a legal doctrine first given expression by the Supreme Court in 1971, holds that nearly any standard applied equally to all Americans—in education, in employment, in housing—adversely punishes some racial minorities. In the 1980s, universities took the high court’s 1978 Bakke decision to mean they could discriminate against whites and Asians. Thus was born the project of fostering “diversity.”

    In the 2000s, as black economic prospects improved little, the terms became more absurd—and more openly racialist. Liberals complained of “colorblind racism,” the idea that disregarding race exacerbated race relations and was, in effect, racist. The terms “unconscious bias” and “microaggression” are premised on the idea that well-meaning people can spread racial animus by using seemingly innocuous words and phrases. In the 2010s, “equity” and “inclusion” joined “diversity” to form an entire industry of consultants and corporate officers whose stated purpose is to foster equality in the workplace but who go about encouraging everyone to think constantly about racial identity.

    All these coinages can fairly be understood as attempts by American liberals to explain to themselves why the beliefs on race they had presupposed for decades remained unimpeachable. At each stage, the effort to avoid rethinking the problem and to cast the blame for continuing racial inequality on somebody else—anybody but themselves— began to look and sound like another version of racism.

    Terms like “white privilege” and “white settler guilt” carried undertones of resentment and loathing.

    Writers for the New York Times and other organs of, as it’s now termed, progressive opinion began using the words “white” and “whiteness” as though they signified a disease.

    In the 2010s an assemblage of radical writers—Ta-Nehisi Coates, Robin DiAngelo, Nikole Hannah-Jones and Ibram X. Kendi prominent among them—became celebrities by alleging that American society had been a racist project from its earliest days. Theirs were more elaborate versions of claims by ’60s radicals that “Amerikkka” had been a source of oppression since its founding; the difference was these weren’t hippie outcasts but tenured professors and award-winning writers, fawned on by journalists too dim to realize the radicals were calling them racist monsters. In a 2014 essay for the Atlantic, Mr. Coates made the case for racial reparations—a policy premised on the idea of punishing people for sins they hadn’t committed.

    He reproached whites for thinking that “if you stab a black person 10 times, the bleeding stops and the healing begins the moment the assailant drops the knife.” Well-in-tended, deliberately nonracist white Americans, in Mr. Coates’s analogy, are at once murderers and idiots.

    Then, in May 2020, the consequences of these twisted ideas spilled into the open.

    The death of George Floyd under the knee of a white police officer, recorded in a harrowing nine-minute video, shoved American liberals’ failure on race into their faces.

    But progressives, having by that point sequestered themselves in their homes in a terrified and ultimately vain effort to escape Covid-19, were in no mood for self-criticism. There would be no rethinking the premises of the Great Society. Otherwise-sane people burst into the streets proclaiming the truism that “ black lives matter” and denouncing the evils of “systemic racism.”

    With this latter term, the effort to double down on the logic of the Great Society reached its ludicrous conclusion. Racism, if it’s systemic, infects everything. You can deplore it, but if you’re part of the system, you’re perpetuating it. Everything is racist. The term was, in many ways, logically congruous with the loose accusation of “racism” to which Americans have long been familiar. To earn the “ist” suffix, you must at some level cultivate, or at least be conscious of, the thing named as an “ism.” You can’t be a royalist if you dislike the monarchy, or a nationalist if you’re indifferent to the nation. A communist cares about the commune or community and has a long list of reasons for rejecting individualism. A Buddhist cares about the Buddha, and an atheist can’t love God. But in the modern progressive worldview, you can be a racist while abominating racism. You may think a person’s race says nothing about his character or competence, and still be a racist.

    So everybody’s a racist. Or everybody other than the people spreading resentment by the “systemic racism” lie.

    The only thing to do is destroy the entire “racist” system. Of course, America’s progressive VIPs were never going to tear down the system that had given them status, privilege and income. What the George Floyd protests mainly accomplished was to make the protesters a little more comfortable with hatred of Bad People. In 2020 it was the cops, especially white cops. But hatreds can expand.

    At each stage of this ugly evolution, some substantial minority of left-wing commentators and politicians became more comfortable with what looked and sounded like straight-up racial bigotry. That the target of their hatred was white people made their rhetoric and behavior appear harmless. But it wasn’t harmless, as anybody might have foreseen.

    For several years a variety of academics and writers had argued that Jews are “white” or “functionally white” or “white passing.”

    “White,” in this usage, has nothing to do with national or religious identity or genetic characteristics.

    It signifies allegedly unjust privilege and legacies of oppression.

    Calling Jews “white” was a way of depriving them of any cover as a racial minority and classifying them with persecutors and exploiters.

    As Liel Leibovitz writes in a 2021 essay for Commentary magazine: “The creative genius of Jew-hatred has always been its ability to imagine the Jew as the embodiment of whatever it is that polite society finds repulsive. That’s why Jews were condemned as both nefarious bankers controlling all the world’s money and shifty revolutionaries imperiling all capital; as both sexless creeps and oversexed lechers coming for the women and the girls; as both pathetically powerless and occultly powerful. . . .

    And if you decide that there’s such a thing as ‘whites’ and that they are uniquely responsible for all evils perpetrated on the innocent and downtrodden, well, the Jews must be not only of them but nestled comfortably at the top of the white-supremacist pyramid.”

    In 2021, when Mr. Leibovitz wrote these words, few detected the Jew-hatred smoldering beneath the surface of progressive thought. The perverse refusal to rethink obviously failed policies on race and crime, or to reconsider shopworn assumptions about why African-Americans had not achieved economic parity with whites, had created the need for scapegoats. To blame whites qua whites worked well enough for a time. But exhibitionist self-hatred is plainly disingenuous and emotionally unsatisfying.

    The left needed real scapegoats.

    What about the Jews? Successful, capitalist, hated by much of the Arab and Muslim world, the Jews— especially Israeli Jews but Jews generally—met the need for a blameworthy Bad People. It was as though the phrase “Never Again,” enunciated endlessly to proclaim the West’s rejection of all the sentiments and ideas that had led to the Final Solution, had become so ingrained in liberal thought that liberals felt they were incapable of embracing the oldest hatred. Never Again . . . but maybe just this once.

    The American left, shameful exceptions aside like members of “The Squad” in Congress, has mostly abstained from openly siding with Hamas in the way its counterparts abroad have.

    But progressives in this country appear paralyzed, unable to condemn the Oct. 7 attack without also condemning “all forms of hatred” and the like. Assaults on Jews go almost without comment in most of the mainstream press. For weeks after Hamas took hundreds of hostages, including Americans, the U.S. news media showed minimal interest in their whereabouts; it was only when Hamas offered to return some of them in exchange for a cease-fire that reports on their plight began to circulate—almost as though the hostages’ usefulness lay exclusively in stopping Israel from just retribution.

    Threats against Jews on elite campuses meet with tepid condemnations and little or no action.

    Democratic Party leaders can’t bring themselves to criticize colleagues who accuse Israel of war crimes in its response to the Hamas attacks.

    Before Oct. 7, if you had predicted this sudden explosion of Jew-hatred in elite American institutions, you would likely have been called a crank. But you could have made a cogent case for your prediction by noting the many ways in which the nation’s progressive cognoscenti, over the course of the past 50 years, have steadily embraced more preposterous and menacing ideas to explain their failure in the one area they believed themselves both competent and righteous: the creation of racial equality and harmony. Those ideas no doubt appeared edgy and romantic because their target was white people, and what’s the harm in white people condemning themselves? But like amateur wizards playing with incantations, the magic got away from them and produced devilry.



    What Gérard Depardieu’s supporters reveal about macho France

    The actor is accused of rape and sex assaults. But women’s voices are being shouted down by the country’s celebration of machismo and unconventional artistes

    Gérard Depardieu’s accusers include Charlotte Arnould, top left, and Emmanuelle Debever when she was 19, bottom left. Figures such as Carla Bruni, Charlotte Rampling and President Macron have come to his aid
    Gérard Depardieu’s accusers include Charlotte Arnould, top left, and Emmanuelle Debever when she was 19, bottom left. Figures such as Carla Bruni, Charlotte Rampling and President Macron have come to his aid
    Nabila Ramdani
    The Sunday Times

    It was a grey day in February 2021 when I saw the newly indicted Gérard Depardieu. I was walking near my home in Paris and one of France’s most celebrated actors was across the street dressed as a detective. He was shooting a film, playing Commissaire Jules Maigret — the most famous fictional policeman in France — and was smiling in between takes.

    On the surface the movie, Maigret and the Dead Girl, looked like another big entertainment hit in the making but there were serious tensions behind the scenes. Paris magistrates had just charged Depardieu with a series of rapes and other sex attacks on Charlotte Arnould, an actress. The assaults were alleged to have taken place a couple of miles away at Depardieu’s £45 million Paris mansion in August 2018.

    Despite the investigation Depardieu remained on unconditional bail, free to continue with his glittering career. “He’s a professional doing his job,” one of the production staff told me. “A great actor needs to be left alone.”

    This same complacency — some might call it Gallic arrogance — has been on display once again in recent weeks. In the years since I saw him, there have been no significant developments in the prosecution of Depardieu, 75, but at least 14 women have come forward to accuse the actor of multiple violent sexual assaults.

    Like Arnould, who is now 28, most have renounced their legal right to anonymity to highlight their allegations, but support for the so-called sacred monster of French cinema is overwhelming. This month President Macron — who has previously declared “I’m a feminist” and pledged to make gender equality the “great cause” of his presidency — called for an end to the “manhunt” during a talk show filmed at the Élysée Palace over the Christmas holidays, saying Depardieu still “makes France proud” and that he should be presumed innocent until convicted by a court.


    Last week famous women including the former first lady Carla Bruni — the wife of Nicolas Sarkozy — and Charlotte Rampling, the English actress and doyenne of the French arts establishment, were among 56 celebrities who signed an open letter published in Le Figaro, expressing outrage at the “lynching” of Depardieu and that he should benefit from the presumption of innocence like any other suspect. “Don’t erase Gérard Depardieu,” they said of the actor who made his name internationally in films such as The Last MetroGreen Card and Cyrano de Bergerac. “Gérard Depardieu is probably the greatest of all actors. When you attack Gérard Depardieu like this, it is art you are attacking.”

    This stance says a great deal about France’s rigorously macho culture. The great contradiction of the 1789 French Revolution is that it overthrew the autocratic monarchical system but not the patriarchy. Artists in particular are still meant to be promiscuous and unconventional, in line with traditions going back centuries and, according to this warped logic, they need protecting. This attitude is just as common among the grandes dames of French cinema as it is among the men.

    Depardieu is now facing allegations from at least 14 women
    Depardieu is now facing allegations from at least 14 women

    Depardieu, who denies any wrongdoing, wrote a letter to Le Figaro in October, in which he pilloried the “media court” and said: “Never, ever have I abused a woman.” Yet the accusations against him continue to mount. A documentary called Depardieu: The Fall of the Ogre, which was broadcast on French television this month, includes a video clip of him variously making obscene comments about women and a ten-year-old girl, and sexually harassing a female translator.

    It also outlines a growing dossier of rape and sexual assault allegations. There is CCTV footage of Depardieu performing a sex act on Arnould, who once considered him a family friend. Paris prosecutors also confirmed this month that the actress Hélène Darras, 43, filed a complaint against Depardieu. She is interviewed in the France 2 documentary, saying she was treated like a “piece of meat” on the set of the 2008 film, Disco. Like many complainants, Darras said she was scared of exposing “the king of the show”, so waited 16 years to go to the authorities.

    Another accuser, the actress Emmanuelle Debever, 60, who claimed she was sexually assaulted by Depardieu on a film set when she was 19, jumped off a Paris bridge this month and died in a suspected suicide. “This monster allowed himself to enjoy plenty during filming, making the most of the intimacy inside a carriage,” Debever wrote in a Facebook post in 2019.

    Feminists and other campaigners have accused Depardieu’s defenders of “losing touch with reality”. Raphaëlle Rémy-Leleu, a Paris councillor, said that, as was so often the case in France, the “words of each victim are being ignored”. Yet this position is not new. Activists point to 2018, when screen legend Catherine Deneuve, 80, who starred with Depardieu in The Last Metro, was among 100 women who condemned the #MeToo movement for going too far. “We defend a right to pester, which is vital to sexual freedom,” Deneuve and her allies wrote, as they lambasted a “puritanical witch-hunt”.

    Depardieu was called out in 2015 for his persistent attempts to kiss Isabelle Huppert, his co-star in the film Valley of Love, on the red carpet at the Cannes film festival
    Depardieu was called out in 2015 for his persistent attempts to kiss Isabelle Huppert, his co-star in the film Valley of Love, on the red carpet at the Cannes film festival

    #MeToo did cut through in France, particularly amongst the young, and even inspired an equivalent campaign #BalanceTonPorc in which women were encouraged to publicly name and shame men over inappropriate behaviour. But there is undoubtedly a generational aspect to this debate. Brigitte Bardot, another French cinema icon in her eighties, has castigated a new generation of thespians for posting the identities of male predators online, saying “in the vast majority of cases” the accusers were “hypocritical nobodies, and ridiculous”.

    These reactionary views can be seen at the very top of French society. Macron has made a point of defending members of his own cabinet facing rape allegations. There were, for instance, widespread demonstrations in 2020, when he made Gérald Darmanin — at the time an alleged sex attacker — his interior minister, and thus in charge of France’s police forces.


    The charges against Darmanin have since been dismissed, but Macron’s defence was revealing. Clearly referencing the #MeToo movement, Macron said men who had been accused but not yet tried should not be judged “by the street” and “social networks” and that France should not adopt “the worst of Anglo-Saxon society”.

    A report by France’s High Council for Equality between Women and Men, a watchdog, has called for an “emergency plan” to deal with “the massive, violent and sometimes lethal consequences” of sexism against women. Figures produced by Darmanin’s department show a woman dies in France every 2.5 to three days after a beating by a partner. Every year, 93,000 women are victims of rape or attempted rape, while 220,000 suffer domestic violence.

    Yet the French judiciary is notoriously sluggish and prone to dropping charges. A strict statute of limitations for prosecutions has ensured that allegations against numerous power players — from broadcasters to captains of industry — escape the scrutiny of a trial. This year, prosecutors closed a high-profile investigation into Gérald Marie, a model agency boss who was accused of sexual offences in the Eighties and Nineties on the basis that too much time had lapsed. Marie denied the allegations.

    Beyond the letter in defence of Depardieu, the other big controversy in Paris during Christmas was the killing of a mother and her four young children, including a baby, at their home in the suburb of Meaux. The prime suspect was the woman’s husband, who is facing five charges of murder.

    It was also revealed that he was first arrested for stabbing his wife in 2019, but charges against him were dropped because of his frail psychological state. Campaigners say police and magistrates ultimately support male suspects, rather than their far more vulnerable victims.

    “Equality” may be a core constitutional value of the French Republic, but it can feel as though a culture of impunity exists, particularly when it comes to crimes against women.

    Nabila Ramdani is a French journalist and the author of Fixing France: How to Repair a Broken Republic, published by PublicAffairs and Hurst.


    Depardieu : la faute politique du président

    Depuis 2017 et les révélations sur le producteur de cinéma prédateur Harvey Weinstein, la vague qui a libéré la parole des femmes victimes de violences sexistes et sexuelles a aussi bouleversé la manière dont les sociétés, en France comme ailleurs, considèrent ces agissements et leurs auteurs, qu’ils soient anonymes ou célèbres. Les artistes, parce que leur vie est scrutée par l’opinion tout entière, parce que leurs comportements sont considérés comme emblématiques, ont alimenté les débats, souvent les scandales, parfois les avancées.

    C’est pourquoi la diffusion, le 7 décembre par France 2, d’images de Gérard Depardieu tournées cinq ans plus tôt, où l’acteur multiplie les remarques avilissantes sur des femmes ainsi que sur une fillette, a produit dans le pays une émotion considérable, avant même que le président de la République ne s’en empare. Depuis des années déjà, l’abîme n’a cessé de se creuser entre le brillant comédien, figure française, star internationale, et l’homme mis en examen en 2020 pour viol et agressions sexuelles, et visé par de multiples accusations sur son comportement lors des tournages.

    Emmanuel Macron, en estimant que l’acteur « rend fière la France », le 20 décembre, sur France 5, n’en a pas moins transformé l’affaire Depardieu en arme de combat politique et commis une lourde faute. Comment le président de la République qui prétend avoir fait des violences faites aux femmes et de l’égalité entre femmes et hommes « les deux grandes causes de [s]es deux quinquennats » peut-il, sans une parole pour celles qui se disent victimes de l’acteur, associer ces comportements détestables et indignes au pays qu’il incarne en tant que chef de l’Etat ?

    Lire aussi le récit :

    La présomption d’innocence, que M. Macron a invoquée, est évidemment un principe à défendre. Et le fait que Gérard Depardieu ait « servi les plus beaux textes » n’est pas contestable. Mais proclamer sa fierté pour un homme qui étale régulièrement son mépris pour la France et son admiration pour Vladimir Poutine, se vante de son exil fiscal et se dit « toujours russe » en dépit de la guerre contre l’Ukraine est aberrant.

    Sombre présage

    On connaît le goût du président pour le contrepied, la « disruption » et les grands écarts du « en même temps ». Quelques jours après sa défense d’une loi sur l’immigration inspirée par l’extrême droite, son éloge de Gérard Depardieu apparaît surtout comme un nouveau clin d’œil à la partie la plus réactionnaire de l’opinion, singulièrement aux hommes qui considèrent la parole des femmes comme une insupportable remise en cause de leur domination. Il donne ainsi des gages aux électeurs qui expriment dans une détestation du « wokisme » la crainte de voir remise en cause leur prétendue supériorité identitaire, raciale ou sexuelle.

    Lire aussi l’enquête :
    Article réservé à nos abonnés

    Ce faisant, le président de la République permet à la droite extrême de marquer de nouveaux points sur le terrain culturel. En semblant accréditer la thèse, pourtant démentie, selon laquelle le reportage accablant pour Gérard Depardieu aurait été manipulé, en se retrouvant piégé par une manœuvre visant à faire de la défense de l’acteur un étendard réactionnaire, illustrée par la tribune de personnalités du cinéma écrite par un militant proche des sphères identitaires, M. Macron s’éloigne un peu plus, non seulement du personnage ouvert à la diversité et aux avancées sociétales qu’il a prétendu incarner, mais de son rôle de « rempart » contre l’extrême droite, décisif lors de ses deux élections. Un sombre présage à l’approche de son « rendez-vous avec la nation » annoncé pour janvier 2024.

    Le Monde