Those Who Are (and Are Not) Sheltered From the Panama Papers

Stratfor, 8 April 2016

Summary

On April 3, the Panama Papers hit media outlets around the world, and the fallout was swift. A prime minister lost his job, and other global leaders are under mounting pressure to account for their actions. But the effects of the leaks are not evenly spread; the documents contained far more information about the offshore activities of individuals in the developing world than in the developed world. Whatever the reasons for the imbalance, it will likely limit the papers’ impact. In the developing world, long histories of corruption have dulled the public’s sensitivity to scandal, and repressive governments leave little room for popular backlash.

So although less information was released on Western leaders, it is already doing more damage. Iceland’s leader has left his post, and relatively minor revelations have had a disporportionately large impact in the United Kingdom and France. Meanwhile, in the developing world, the Panama Papers’ effects have been most strongly felt in the former Soviet Union, a region in which political tensions were already high. The leaks’ results have been more mixed in China, where they have provided new targets for the anti-corruption drive already underway but have also implicated figures close to the administration’s upper ranks.

This is only the beginning. The Panama Papers are the largest information dump of their kind, and the information that has been released so far appears to be just the tip of the iceberg. They are also the latest in a string of public leaks that seem to be happening more and more frequently. As revelations continue to surface, calls for greater global transparency will only get louder.

Stratfor’s analysis by region

Former Soviet Union
Europe
Latin America
Asia-Pacific
Middle East and North Africa
Sub-Saharan Africa
South Asia

See the full report at Stratfor.

Stratfor: Europe’s Chronic Jihadist Problem

Europe’s Chronic Jihadist Problem

Lead analyst: Scott Stewart
Stratfor, 8 April 2016

Forecast

European authorities have arrested a number of suspects linked to the Paris and Brussels terrorist attacks, but the arrests address only the immediate threat, not the root of the problem.
Europe’s jihadist threat will continue to be deeper and more complex than North America’s because of differences in their Muslim communities.
Despite recent counterterrorism successes, the threat of attacks in Europe will remain high for years to come.
As long as the ideology of jihadism survives, and as long as Europe’s Muslims remain marginalized and disenfranchised, European security services will not be able to arrest their way out of this problem.

Continue reading →

Matthew Yglesias tells us not to worry about the new industrial revolution

8 Replies

Summary: The new industrial revolution has begun, yet we have not yet begun to prepare. An article by Matthew Yglesias, neo-lib story-teller extraordinaire, shows why. He explains that faith-based economics assures us all will work out for the best.

Industrial revolution

Last week I posted Well-meant minimum wage increases will accelerate automation. On the same day Matthew Yglesias posted “Will minimum wage hikes lead to a huge boost in automation? Only if we’re lucky.” at VOX. He provides an unusually clear example of liberals’ love of just-so stories to explain the world in a pleasing fashion — much like the follies of conservatives that liberals (correctly) condemn (e.g., Megan McArdle).

Yglesias explains the new industrial revolution in simple and non-threatening terms. No need to worry, let alone act, since the experts are in control (it’s the neoliberals’ mantra). The opening states his thesis.

“…one major line of criticism from outlets like the Wall Street Journal editorial page and Forbes’s Tim Worstall is that big increases in pay floors only lead to job loss via automation. Both critics point to initiatives at McDonald’s and Wendy’s to automate more of the service process, and warn that robots, rather than workers, will be the real winners if liberals succeed in boosting minimum pay.

“This is doubly wrong. On the one hand, there’s little guarantee that increased minimum wages really will increase the pace at which labor-saving technology is developed. On the other hand, there’s no reason to think this would be a bad scenario.”

To draw these confident conclusions he closes his eyes and makes stuff up. This is a common response to the new industrial revolution, one large reason we are so poorly prepared for its obvious effects. Yglesias supports his first assertion by saying…

Continue reading →

Can we defeat ISIS by “killing them all”? We’ve learned nothing since 9/11.

15 Replies

Summary: What have we learned from our ways since 9/11? How have we changed since 9/11? The enthusiasm of our presidential candidates, except Trump and Sanders, for more of the Long War suggests we’ve learned nothing. The broad support for torture (63% in a recent poll) suggests that we have become more like the monsters we fight. This interview with noted military experts Ralph Peters shows both these trends, an ominous sign for our future.

“Kill them all; let God sort them out.”
— Loose translation of phrase attributed to Papal legate Arnaud Amalric before the Massacre at Béziers, in France at the start of the Albigensian Crusade.

Another demonstration of America’s failure to learn from our post-9/11 wars

Ralph Peters about 4GW

In the 15 years of our post-9/11 wars US forces have fought across the Middle East. We have employed the full trinity of US military methods — popular front militia, massive firepower on civilians (e.g., winning hearts & minds with artillery), plus sweep and destroy missions. Local forces have defeated us in Iraq and Afghanistan by the only metric that counts — they’re still there after we leave. Yet we have learned nothing from this expenditure of America’s blood and money, as we see here.

Ralph Peters (Lt. Colonel, US Army, retired) on Fox News, 22 March 2016

O’REILLY: Do you think the American people have the will to fight ISIS? I mean, the polls show that most favor ground troops, but an entire political party, the Democratic Party is against any kind of meaningful confrontation. What about the folks in general? What do you think?

PETERS: Well, I think the American people certainly could summon the will to defeat ISIS, to destroy ISIS, if properly led. But we are not properly led, and I’m afraid looking at the political landscape we may not be properly led. Because I’m not — generalities won’t defeat ISIS. I’m not hearing the kind of expertise, depth, and strength of character it will take. Worse, Bill, worse, we now have two generations of military officers educated, trained, convinced that it’s more important to prevent casualties and collateral damage than to win. Honestly, I don’t know if our military leaders have the character, the wherewithal to do what it takes to defeat ISIS. It’s not about winning hearts and minds, it’s about splashing their hearts and brains all over the landscape.

Even for Fox News, this is an amazingly ignorant statement to hear in the 15th year of our post-9/11 wars (he said much the same thing in 2014). We’ve learned nothing from our experiences, going back to our attempts to win by “killing them all” in the Vietnam War…

Continue reading →

The battle of institutions vs. technology = rising wage inequality

8 Replies

Summary: Although denied for years, by now rising inequality is acknowledge even by conservatives — so the debate shifts to its causes and remedies. The “standard” answer points to the “invisible hand” of “market forces”. New cutting edge research shows that this defense, much like the earlier denials, does not match the facts. This post excerpts from a important new paper by Tali Kristal and Yinon Cohen in Socio-Economic Review.We cannot fix what we do not understand.

Scales of Income Inequality

“The causes of rising wage inequality:
the race between institutions and technology“

Tali Kristal and Yinon Cohen, Socio-Economic Review, in press
Excerpt posted with the authors’ generous permission

Abstract

Many inequality scholars view skill-biased technological change — the computerization of workplaces that favours high-skilled workers — as the main cause of rising wage inequality in America, while institutional factors are generally relegated to a secondary role.

The evidence presented in this article, however, does not support this widely held view. Using direct measures for computers and pay-setting institutions at the industry level, this article provides the first rigorous analysis of the independent effect of technological and institutional factors on rising wage inequality.

Analysing data on 43 US industries between 1968 and 2012, we find that declining unions and the fall in the real value of the minimum wage explain about half of rising inequality, while computerization explains about one-quarter. This suggests that much of rising inequality in the USA is driven by worker disempowerment rather than by market forces — a finding that can resolve the puzzle on the diverging inequality trends in USA and Europe.
Continue reading →

Sociologist Wolfgang Streeck asks if Capitalism has a future

7 Replies

Summary: The pace of change has accelerated since Y2k so that it’s difficult to see what’s happening. Here’s a provocative essay by sociologist Wolfgange Streeck describing an evolution almost too large for us to see as it happens — the decline of capitalism (and, though he does not discuss this, its evolution into something else).

Evolution

Thou know’st ’tis common;
all that lives must die,
Passing through nature to eternity.

— Queen Gertrude to Hamlet in Act I, scene 2.

Excerpt from “On the dismal future of capitalism“

By Wolfgang Streeck
Socio-Economic Review, January 2016

The writing is on the wall, and has been for some time; we must only learn to read it. The message is: capitalism is a historical social formation; it has not just a beginning but also an end. Three trends have run in parallel since the 1970s, throughout the family of rich capitalist democracies: declining growth, rising inequality of income and wealth and rising debt — public, private and total. Today the three seem to have become mutually reinforcing: low growth contributes to inequality by intensifying distributional conflict; inequality dampens growth by curbing effective demand; high levels of existing debt clog credit markets and increase the risk of financial crises; an overgrown financial sector both results from and adds to economic inequality etc.

Already the last growth cycle before 2008 was more fake than real and post-2008 recovery remains anaemic at best, also because Keynesian stimulus, monetary or fiscal, fails to work in the face of unprecedented amounts of accumulated debt.

Note that we are talking about long-term trends, not just a momentary unfortunate coincidence, and indeed about global trends, affecting the capitalist system as a whole and as such. Nothing is in sight that seems only nearly powerful enough to break the three trends, deeply engrained and densely intertwined as they have become.

… State-administered capitalism has failed — that is, was rejected by the owners of capital as too costly for them, to be replaced with free-market capitalism, which has also failed. For the time being, central banks act as regents waiting for a new ruler. But who would this be, and what would be his recipe for holding the capitalist enterprise together?

Continue reading →

Rising seas alert! Watch how science becomes a sensational news story.

7 Replies

Summary: Another day, another interesting study about our changing climate misreported by journalists to ignite fear in their readers. The subject is rising seas from the melting of Antarctica. First we look at the science, then at journalists’ hype. You decide how this news should influence the public policy debate about the best response to climate change.

Example of Greenpeace at work.

“Contribution of Antarctica to past and future sea-level rise“

Robert M. DeConto & David Pollard in Nature, 31 March 2016

Abstract

“Polar temperatures over the last several million years have, at times, been slightly warmer than today, yet global mean sea level has been 6–9 metres higher as recently as the Last Interglacial (LIG, 130,000 to 115,000 years ago) and possibly higher during the Pliocene epoch (about three million years ago). In both cases the Antarctic ice sheet has been implicated as the primary contributor, hinting at its future vulnerability.

“Here we use a model coupling ice sheet and climate dynamics — including previously underappreciated processes linking atmospheric warming with hydrofracturing of buttressing ice shelves and structural collapse of marine-terminating ice cliffs — that is calibrated against Pliocene and Last Interglacial sea-level estimates and applied to future greenhouse gas emission scenarios. Antarctica has the potential to contribute more than a metre of sea-level rise by 2100 and more than 15 metres by 2500, if emissions continue unabated. In this case atmospheric warming will soon become the dominant driver of ice loss, but prolonged ocean warming will delay its recovery for thousands of years.”

About the study

Their predictions of rising sea levels

Here is the core of the study’s forecast. Red highlight added to their key finding.

Continue reading →

Fabius Maximus website

Those Who Are (and Are Not) Sheltered From the Panama Papers