Factfulness

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from: Hans Rosling, Factfulness

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Don’t be fooled by the new calm on the Korean peninsula

Date: 18-08-2018
Source: The Economist: Banyan

Dangers still abound

AFTER a summer lull, the whirlwind of North Korea-centred diplomacy that marked the first half of the year is about to resume. This week officials from North and South Korea met at the truce village of Panmunjom in the demilitarised zone on the border and declared that their leaders would meet, for the third time, in Pyongyang, the North Korean capital, next month. Kim Jong Un, the North’s dictator, and Moon Jae-in, the South’s president, first met only in April. It all represents an extraordinarily rapid change following previously frozen relations—and North Korean nuclear belligerence.

Mr Kim’s nuclear and missile tests, which he suspended late last year, infuriated China, the North’s historical protector, as much as they unsettled the South. Yet President Xi Jinping has invited him to China on three occasions this year, and he may honour Mr Kim with a visit to Pyongyang around the time of the 70th-anniversary celebrations of the communist state’s founding on September 9th. Nothing has been announced by the secretive states. Yet the sudden cancellation of Chinese tourist visits to North Korea, the announcement of a “renovation” of all of Pyongyang’s hotels, plus a crackdown on smuggling along the two countries’ border, suggest preparations for a high-level visit.

South Korea and China represent two of Mr Kim’s opponents in a four-way chess match. His most important challenger is the United States. He is doing well there too. President Donald Trump still luxuriates in the memory of the two men’s made-for-television pageant in Singapore in early June. Mr Trump declared it a triumph for peace on Earth, and took the credit. Yet Mr Kim took the limelight, holding Mr Trump in his hand. His next stage may be at the UN General Assembly in New York in late September. An invitation to the White House still stands.

Google Outgrows Its Youthful Ideals

Date: 17-08-2018
Source: The Wall Street Journal

In middle age, the search giant’s motto has gone from ‘Don’t be evil’ to something more like ‘Get real.’

Google’s leaders’ display of a more pragmatic side risks alienating both its employees and its users.

Everybody’s got to grow up sometime. For Alphabet Inc.’s Google, that transition from youthful idealism to crusty, middle-age realism is in full swing.

The latest evidence of Google’s pragmatic side is its Dragonfly project, a version of its search engine that would conform to China’s strict censorship, so that Google can bring search back to that country after abandoning it in 2010. But this is hardly the first example of Google’s “Don’t be evil” approach morphing into something more like “Get real.” (Even that famous motto has been downgraded in the company’s latest code of conduct.)

In the past year, Google’s leadership had to rapidly backpedal from the company’s attempt to work with the Department of Defense on projects to enhance weapons targeting—and the decision to back out met with criticism as well. The company also recently found itself defending its practice of tracking users who have switched off “location services,” as well as its apparent lack of policing of developers who are granted access to users’ Gmail accounts.

How Democracies Can Fight Authoritarian Sharp Power

Date: 17-08-2018
Source: Foreign Affairs

New Laws Aren’t Enough

All around the world, authoritarian governments are interfering with the institutions of democratic societies in ways that would have been unthinkable even during the Cold War. Universities, news organizations, think tanks, film studios, museums, publishing houses, and every aspect of the political process are being targeted by outside influence. This kind of sharp power is so effective because institutions in democratic settings are open to the outside world and thus vulnerable to foreign manipulation. Policymakers within democracies need to grapple with the challenge of repelling outside influence while upholding essential democratic values.

AUSTRALIA’S NEW LAWS
Australia offers a good case study. On June 28, the Australian parliament voted to adopt two new bills to contend with the threat of foreign political interference, which the bills defined as efforts that are covert, corrupting, or coercive. Although recent attention to meddling by the Chinese Communist Party (CCP) motivated the legislation, the new laws do not single out any specific country. The first, the National Security Legislation Amendment (Espionage and Foreign Interference) Bill 2018, updates the categories of behavior that constitute espionage and increases the state’s legal capacity to prosecute covert and deceptive conduct on behalf of a “foreign principal,” that is, a foreign government, political organization, or public enterprise, as well as individuals and entities connected to them.

Its companion, the Foreign Influence Transparency Scheme Bill 2018, requires people who carry out certain specified activities on behalf of a foreign principal to register their relationship and disclose the nature of their activities. A proposed third piece of legislation, the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017, would prohibit political candidates from receiving campaign donations from abroad and create a public registry of non-party political actors, such as political campaigners, third-party campaigners, and associated entities. Parliament has not yet acted on the bill due to concerns that labor unions and nonprofits may face onerous registration and reporting requirements, but it has generated significant public debate and prompted some state governments to increase political donation disclosure requirements.

Australia’s civil society and media have played a vital role in the conversation about authoritarian interference and other harmful forms of influence. They have documented authoritarian activities, communicated them to the public, and vigorously debated the proposed legislation. Over the past several months, Australian universities, schools, China scholars, and other groups in civil society have voiced their varying levels of concern over, criticism of, and support for the laws. Australian and international media outlets have extensively covered the various drafts of the legislation. International human rights organizations have weighed in, too.

The issue has divided Australia’s scholarly community. Two groups of academics issued separate public letters, one expressing concern about the tone and precision of the public discussion, the other registering support for the debate as “valuable and necessary.” Some in civil society, as well as some opposition politicians, were concerned that the laws would define political interference too broadly, thus impinging on freedoms of expression and association.

As a result, the two laws passed in June incorporated over 200 amendments aimed at safeguarding civil and political freedoms. Although the amendments may not address every possible concern, the new laws will allow Australia to begin taking meaningful action against foreign interference while reserving the possibility of fixing legal problems that arise.

FIGHTING BACK
Yet Australia’s experience also shows that democracies cannot rely solely on governmental measures to address such a complex challenge. The world is still at an early stage of dealing with sharp power. For many years, Australia, and virtually every other democracy, did not recognize the growing problem or take the initiative to address it. For too long, observers in democracies interpreted authoritarian influence through an outdated lens, even as China and Russia embedded themselves in democratic societies as part of the autocratic regimes’ broader internationalist turn. As we noted in Foreign Affairs last November, China, in particular, has established platforms for educational, cultural, and other forms of influence within democratic societies. Such initiatives tend to be “accompanied by an authoritarian determination to monopolize ideas, suppress alternative narratives, and exploit partner institutions.”

Because sharp power can affect democratic institutions so subtly and in so many different ways, understanding how it works is a tricky business. For instance, China’s authorities can disguise state- or party-directed projects as private media firms or grassroots associations. The CCP can also use academic exchange programs and other forms of institutional cooperation to disseminate its propaganda. Our analysis of Beijing’s various influence initiatives suggests that the CCP seeks to preempt, neutralize, or minimize challenges to the regime’s presentation of itself. The Chinese government often portrays the country as a benign influence, yet it systematically discourages anyone from challenging its standing or positions, which can lead people and organizations to censor themselves, even when the Chinese government cannot censor them directly.

Democracies need better ways of responding. In the past, leaders of important public institutions—publishers, university administrators, media executives—did not need to take into account the prospect of censorship or manipulation by external authoritarian forces. Today, they must renew their commitment to democratic values and free expression. The institutions they run should establish common standards and transparency measures to reduce their exposure to sharp power and safeguard their integrity. Universities, especially public ones, might commit to publishing any contracts they have entered into with foreign governments or entities connected with foreign governments. Private-sector groups could adopt voluntary codes drawing from the UN Guiding Principles on Business and Human Rights, or help set up new initiatives with other parts of civil society to discuss private and public responses to manipulation by authoritarian powers.

The same holds true for electoral systems. Until recently, election observers focused on upholding standards in countries where governments might seek to rig the election process. Today, democracies also need to defend their electoral systems from external attacks. Such measures could include ensuring that governments share up-to-date information about hacking efforts with local authorities and equipping journalists with the knowledge they need to report accurately on the types of foreign disinformation tactics that typically spike before elections.

In many democracies that are vulnerable to sharp power, there is a severe shortage of information about influence efforts by China, Russia, and other authoritarian governments. Attempts by these regimes to curb free expression and corrode democratic institutions need to be rigorously documented in order to create a shared understanding of the challenge. That will require independent sources of expertise, such as academic centers, media outlets, and think tanks that are unbeholden to authoritarian governments’ agendas and that can understand authoritarians’ political objectives and monitor their influence activities. Such support is especially important in democracies in parts of Africa, Asia, Europe, and Latin America that may be less able to defend their norms and institutions themselves.

Journalists, civil society organizations, and country and subject matter experts must work together—within their own countries and with international counterparts—to analyze events, share information, and combine expertise. They should consider how they can agree upon common institutional standards to safeguard the integrity of the public sphere within their democracies.

Australia’s new laws, and those that other democracies are bound to debate and adopt, may prove essential to defending against corrosive forms of authoritarian influence. But they need to be the beginning, not the end, of the fight against sharp power.

The New Tribalism and the Crisis of Democracy

Date: 17-08-2018
Source: Foreign Affairs By Francis Fukuyama
Subject: Against Identity Politics

Beginning a few decades ago, world politics started to experience a dramatic transformation. From the early 1970s to the first decade of this century, the number of electoral democracies increased from about 35 to more than 110.

Over the same period, the world’s output of goods and services quadrupled, and growth extended to virtually every region of the world. The proportion of people living in extreme poverty plummeted, dropping from 42 percent of the global population in 1993 to 18 percent in 2008.

But not everyone benefited from these changes. In many countries, and particularly in developed democracies, economic inequality increased dramatically, as the benefits of growth flowed primarily to the wealthy and well-educated. The increasing volume of goods, money, and people moving from one place to another brought disruptive changes. In developing countries, villagers who previously had no electricity suddenly found themselves living in large cities, watching TV, and connecting to the Internet on their mobile phones. Huge new middle classes arose in China and India—but the work they did replaced the work that had been done by older middle classes in the developed world. Manufacturing moved steadily from the United States and Europe to East Asia and other regions with low labor costs. At the same time, men were being displaced by women in a labor market increasingly dominated by service industries, and low-skilled workers found themselves replaced by smart machines.

Factfulness

the solution will be shown after 7 days

from: Hans Rosling, Factfulness

Tesla founder Elon Musk says past year excruciating and ‚worst is yet to come‘

Date: 17-08-2018
Source: The Guardian

In emotional interview, Tesla founder says he has endured ‘the most difficult and painful’ time of his career

Elon Musk spoke to the New York Times about his difficult year.

Elon Musk has said the past year of his professional life has been “excruciating” and that stress over his business had caused his health to deteriorate.

In an emotional interview with the New York Times the founder of electric car maker Tesla, also revealed that the pressures of work had caused him to spend his birthday stuck in the Tesla factory and almost miss his brother’s wedding.

“This past year has been the most difficult and painful year of my career,” he said in the interview.

Musk, whose company posted a record $709.6m net loss in the first quarter of this year while struggling to manufacture large numbers of its Model 3 mass-market electric car, said he had been working up to 120 hours a week and as a result his health had been “not great” and his friends had been worried about him.

Greece’s eight-year odyssey shows the flaws of the EU

Date: 16-08-2018
Source: The Economist: Charlemagne

The island where the euro crisis started has yet to recover from Europe’s help

KASTELLORIZO is “the end of Europe—or perhaps its beginning”. So says Yannis Doulgaroglou, co-owner of the Hotel Kastellorizo, a sunny inn on Greece’s easternmost inhabited island. A tiny rocky outpost just off the Anatolian coast, on maps of Greece Kastellorizo is often relegated to an inset. Yet it was from the island’s picturesque harbour, on April 23rd 2010, that George Papandreou, the prime minister, stared blankly into a camera and acknowledged that his troubled country had lost access to capital markets and needed a financial rescue package from its euro-zone peers. The day is etched in the memory of most Greeks. Chuckling, Mr Doulgaroglou recalls the journalists who scarpered from his hotel once they realised the prime minister was saying something momentous, leaving behind their unpaid bills.

Eight years and three bail-outs later, as Greece prepares to leave its final programme on August 20th, Mr Papandreou’s remarks seem laden with pathos. He directed his ire at the “speculators” who had sent Greek bond yields soaring, more than at the successive governments that had overspent, under-reformed and fiddled the national accounts. Yet, he vowed, with a “common effort” Greece would “reach the port safely, more confident, more righteous and more proud.” He called this the “new Odyssey”.

The other barely managing Britain

Date: 16-08-2018
Source: The Economist: Bagehot

A depressing number of Britons are struggling to keep their heads above water

THE first thing Theresa May did on becoming prime minister in July 2016 was deliver a speech promising to help the just-about-managing. Since then she has done almost nothing to make good on that promise. Brexit has consumed her attention. Bold initiatives have mouldered on her desk. Life for the JAMs is more of a struggle than ever.

A good place to see this is Birkenhead, next door to Liverpool, not least because of its thoughtful local Labour MP, Frank Field. Birkenhead looks like a stronghold of the respectable working class—all neat houses and well-tended gardens. But you do not have to look hard to see that society is fraying. Supermarkets such as Marks & Spencer are upping sticks. Pound stores, gaming emporiums, pawn shops (“We loan cash”) and cheap pubs (“Three pints for £5”) are on the march. Zero-hour contracts are depressingly common.

Greece: Long-Run GDP Growth Prospects Are Poor

Friday, August 17, 2018, Observing Greece

Last month, the IMF pubslished its 2018 Article IV Report on Greece and it was widely commented in the media. I have now read the full 80+ pages and can only recommend others to read the full report. It can be found under this link (under the caption Electronic Access, click on Free Full Text).

I focus here on Annex VI about Greece’s Long-Term Growth Potential and I reproduce it below. A summery statement would be: „Ceteris paribus, aging would imply an average yearly decline of 1.1 percentage points in Greece’s labor force during the next four decades. Labor productivity (output per worker) would grow only at about 0.4 percent in the steady state (the rate of TFP growth adjusted for the labor share in output). Long-run GDP growth prospects are thus poor, absent a major change in policies. Structural reforms to raise TFP growth and employment are therefore the only option to achieve higher long-term output growth.“

Below is the Annex VI about Greece’s Long-Term Growth Potential.

1. Greece is set to experience dramatic population aging over the next several decades. In its 2018 Aging Report, the EC projects Greece’s working age population to fall by about 35 percent between 2020 and 2060 due to a shrinking and rapidly aging population. This is among the largest such declines in the Euro Area, and three times the average fall for the Euro Area. Ceteris paribus, aging would imply an average yearly decline of 1.1 percentage points in Greece’s labor force during the next four decades.

2. Greece’s productivity growth has historically been poor. Greece’s underperformance relative to peers is often associated with relatively low openness of the economy and a high share of labor allocated to non-tradable sectors. Total factor productivity (TFP) growth over the last 47 years averaged just ¼ percent annually, by far the lowest in the Euro Area. Assuming this historical average TFP growth rate going forward, labor productivity (output per worker) would grow only at about 0.4 percent in the steady state (the rate of TFP growth adjusted for the labor share in output).

3. A pickup in investment could provide a short-run boost to growth, but productivity and demographics will dominate in the longer run. Investment is bound to recover from its highly depressed level once Greece emerges from the crisis, but the growth effect of this will wane once the capital stock returns to its long-run level. Staff’s medium-term projections already assume a temporary boost to GDP growth from higher investment (with real GDP growth rates averaging close to 2 percent during the investment recovery). Once the transition to the new, higher capital ratio is completed, however, the impact of increased investment will fade and growth dynamics will be determined by the evolution of output per worker and of the number of workers.