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Filtering by Category: Foreign Policy
Moisés Naím / Foreign Policy
What should be a higher priority: reducing inequality or alleviating poverty? It is, of course, tempting to answer that they are equally important. Or, that the question is moot because reducing poverty will automatically shrink income disparities; or that policies that lower inequality will inevitably reduce poverty.
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Latin America has grown used to living in the backyard of the United States. For decades, it has been a region where the U.S. government meddled in local politics, fought communists, and promoted its business interests. Even if the rest of the world wasn’t paying attention to Latin America, the United States occasionally was. Then came September 11, and even the United States seemed to tune out. Naturally, the world’s attention centered almost exclusively on terrorism, the wars in Afghanistan, Iraq, and Lebanon, and on the nuclear ambitions of North Korea and Iran. Latin America became Atlantis — the lost continent. Almost overnight, it disappeared from the maps of investors, generals, diplomats, and journalists.
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My friend was visibly shaken. He had just learned that he had lost one of his clients to Chinese competitors. "It’s amazing," he told me. "The Chinese have completely priced us out of the market. We can’t compete with what they are able to offer."
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Welcome to the new shadow financial system, a world where regulators are hampered and bankers are bold. The "old" shadow financial system, before the bubbles burst, thrived on ample liquidity and lax regulations. The new one will be less liquid but will flourish thanks to the many new and incomplete regulations that will characterize the post-crisis world.
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In the past five years, the bird flu epidemic claimed 186 victims worldwide. In the same period, another less-recognized but growing menace maimed or killed millions of people and produced massive economic losses. Like others, this dangerous pandemic ignores national borders and erupts in different places at different times. Inexplicably, it has surged in Boston and abated in Bogotá. Experts disagree about its precise causes and what explains its sudden eruptions. Unlike bird flu, it is not caused by a virus transmitted from one species to another; it is exclusively created and spread by people. I am talking about street crime.
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A video shows a single line of people slowly trudging up a snow-covered footpath. A shot is heard; the first person in line falls. A voice-over says, "They are shooting them like dogs." Another shot, and another body drops to the ground. A uniformed Chinese soldier fires his rifle again. Then, a group of soldiers examines the fallen bodies.
Read MoreMoisés Naím / Foreign Policy
The Myanmar Women’s Affairs Federation is a GONGO. So is Nashi, a Russian youth group, and the Sudanese Human Rights Organization. Saudi Arabia’s International Islamic Relief Organization is also a GONGO, as is Chongryon, the General Association of Korean Residents in Japan. GONGOs are everywhere, in China, Cuba, France, Tunisia, and even the United States.
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You can always count on the Olympic Games to provide drama. Next year’s games in Beijing will be no different; they too will produce powerful stories and riveting television. But this time the images will not just be athletes overcoming the odds or breaking records. They will also focus on the clashes between the Chinese police and the activists who will arrive from all around the world. The causes that motivate their activism range from human rights to global warming, from Darfur to Tibet, from Christianity to Falun Gong. The clashes outside the stadiums are likely to be more intense and spectacular than the sports competitions taking place inside. And the showdown will be captured as much by the videocameras in the cell phones of protesters and spectators as any news agencies’ camera crews. In fact, the Beijing Olympics will not just offer another opportunity to test the limits of human athletic performance; it will also test the limits of a centralized police state’s ability to confront a nebulous swarm of foreign activists armed with BlackBerries. A governmental bureaucracy organized according to 20th-century principles will meet 21st-century global politics. Lenin meets YouTube.
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One of the most perplexing trends of our time is that free-trade negotiations are crashing while free trade itself is booming. For more than a decade, attempts by governments to get a global agreement to lower trade barriers have gone nowhere. These trade talks are routinely described as "acrimonious," "gridlocked," and "stagnant." In contrast, international trade is commonly described as "thriving" or "surging," and almost every year, its growth is lauded as "record breaking." It’s no surprise that trade negotiators feel as despondent as international traders are cheerful.
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The middle class in poor countries is the fastest-growing segment of the world’s population. While the total population of the planet will increase by about 1 billion people in the next 12 years, the ranks of the middle class will swell by as many as 1.8 billion. Of these new members of the middle class, 600 million will be in China. Homi Kharas, a researcher at the Brookings Institution, estimates that by 2020 the world’s middle class will grow to include a staggering 52 percent of the global population, up from 30 percent now. The middle class will almost double in the poor countries where sustained economic growth is lifting people above the poverty line fast. For example, by 2025, China will have the world’s largest middle class, while India’s will be 10 times larger than it is today.
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The world wants America back. For the next several years, world politics will be reshaped by a strong yearning for American leadership. This trend will be as unexpected as it is inevitable: unexpected given the powerful anti-American sentiments sweeping the world, and inevitable given the vacuums that only the United States can fill and that others will increasingly demand that it fills.
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The spike in food prices is a global crisis, and it is destabilizing politics and economics everywhere. Food prices have doubled in the past two years, and most signs indicate they will stay high. Not surprisingly, the poor will bear the heaviest burden. Household surveys show that the poor already devote half of their spending to food. Inevitably, this percentage will rise sharply, cutting into what people have left for basic expenses like healthcare or shelter. This crisis, which caught governments by surprise, is undermining much of the progress that was made in lifting people out of poverty in the past 10 years. The World Bank estimates that high food prices will quickly pull 100 million people back below the poverty line.
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“I am not worried about rich Arabs; it’s the French who worry me." This was the response from a businessman in Clovis, California, reacting to my comment that the U.S. government was concerned about the influence of foreign-owned sovereign wealth funds.
"Why are you worried about the French?" I asked.
"They just bought the largest company here," he replied. "Life will now change for all of us — that company has been an important part of this community for years." He was referring to Pelco, a Clovis-based manufacturer of video security systems that was recently acquired by Schneider Electric, a French company.
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The global financial meltdown is as surprising and unprecedented as the 9/11 attacks. Beyond that, the two calamities are very different; the financial crash will undoubtedly have broader consequences, hurting more people in more countries. Yet, 9/11 and its aftermath continue to offer a case study in some pitfalls to avoid when catastrophe hits.
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The official position of the United States is that Europe should allow Turkey to join the European Union. Turkey’s entry would give its citizens the right to travel freely to any other EU member state. This prodding to Europeans to embrace Turkey comes from the same country that is building a 700-mile-long wall along its border with Mexico.
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The financial crisis has killed the claim that economics deserves to be treated as a science. The measure of a science is its capacity to explain, predict, and prescribe. And most economists not only failed to anticipate the nature and evolution of the catastrophe, but their conflicting recommendations on how to stabilize the situation exposed the unreliability of their knowledge. As much as Wall Street and Main Street, the economics profession needs a bailout of its own.
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The Washington consensus on drugs rests on two widely shared beliefs. The first is that the war on drugs is a failure. The second is that it cannot be changed.
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"Globalization Is a Casualty of the Economic Crisis."
No. That is, not unless you believe that globalization is mainly about international trade and investment. But it is much more than that, and rumors of its demise — such as Princeton economic historian Harold James’s recent obituary for "The Late, Great Globalization" — have been greatly exaggerated.
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Oil is a curse. Natural gas, copper, and diamonds are also bad for a country’s health. Hence, an insight that is as powerful as it is counterintuitive: Poor but resource-rich countries tend to be underdeveloped not despite their hydrocarbon and mineral riches but because of their resource wealth. One way or another, oil — or gold or zinc — makes you poor. This fact is hard to believe, and exceptions such as Norway and the United States are often used to argue that oil and prosperity can indeed go together.
Read MoreMoisés Naím / Foreign Policy
Where are the fatwas? The angry marches in front of embassies, the indignant speeches? Where are al Qaeda’s videos? In short, what does China have that Denmark did not? China has been actively discriminating against Muslims, and recently a number of them have been killed in violent street riots.
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