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Archive for 25. Mai 2019

Why cosying up to populists rarely ends well for moderates

Posted by hkarner - 25. Mai 2019

Date: 23-05-2019
Source: The Economist: Charlemagne

“Ibizagate” in Austria is just the latest example

On a freezing morning in Vienna in December 2017, Charlemagne heard a tempting case for what might be called “the hug strategy”. He was drinking coffee with an ally of Sebastian Kurz, the young leader of the centre-right Austrian People’s Party who was hours from a coalition deal with the hard-right Austrian Freedom Party (fpö). “He has grown up,” said the Kurz-ite of Heinz-Christian Strache, the fpö’s leader, adding that, in any case, Mr Kurz would be able to manage his new ally. Having already edged towards some fpö positions and won back some of its supporters, the incoming chancellor would render his coalition partner irrelevant in government and thus contain the hard-right while governing pragmatically. It all sounded very clever.

It proved otherwise. Mr Kurz’s big hug failed to stifle Mr Strache. At recent rallies in the South Tyrol and Linz your columnist watched the vulpine vice-chancellor charge in to the boisterous oomph of Johann Strauss’s Radetzky March before unveiling his latest designs: Austrian passports for German-speakers in northern Italy, mosque closures, an end to the “population replacement” of white Europeans by immigrants. Support for the fpö remained high and stable at around 25%. Its ministers undermined the independence of Austria’s state broadcaster and attacked the rights of asylum-seekers. Karin Kneissl, the fpö-backed foreign minister, danced with Vladimir Putin at her wedding. Some containment this was turning out to be. Den Rest des Beitrags lesen »

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Choosing Boris Johnson as prime minister would be a dangerous gamble

Posted by hkarner - 25. Mai 2019

Date: 22-05-2019
Source: The Economist: Bagehot

Before making their bet, Conservatives should ask themselves three big questions

THE CONSERVATIVE PARTY has a long history of making big bets on mavericks whenever it thinks that its back is against the wall. Before they won the party leadership, three of the greatest Tory prime ministers were cordially loathed by their party. Margaret Thatcher was regarded as a polarising ideologue who lacked the ability to connect with voters or command Parliament. Winston Churchill was a boozy bloviator and serial bungler, launching the Dardanelles campaign and clinging to the gold standard. Benjamin Disraeli was a flashy outsider who had no achievements to his name other than undermining Robert Peel over the Corn Laws. The Tories punted on all three and won big.

It looks as if the party is about to gamble again on Boris Johnson. The former foreign secretary is the overwhelming favourite among party members, who elect the leader. His only obstacle is persuading enough of his fellow Conservative MPs to put him on the shortlist of two. So far they have been sceptical. The charge sheet against Mr Johnson is a long one: a chaotic private life, a habit of bending facts, a lack of focus and discipline and being what Sir Max Hastings, a former editor of the Conservative house journal, the Daily Telegraph, calls a “gold-plated egomaniac”.

But the party is in a full-blown panic. It is likely to come a poor fourth in this week’s European election, thanks to the rise of Nigel Farage’s Brexit Party and the implosion of Theresa May’s premiership. If the split on the right continues, it will put Labour’s far-left Jeremy Corbyn in Downing Street. What’s more, for all Mr Johnson’s faults he is a genuine political star, one of a handful of politicians who is known internationally by his first name (if not always for the right reasons). Because of his leading role in Brexit he no longer has the ability to reach out to the cosmopolitan liberals who gave him two terms as mayor of London. But he nevertheless has a rare ability to light up a room. Mrs May was a grand immiserator who made everybody around her feel rotten. Mr Johnson is a booming cheerleader who makes people feel good about themselves. Who better to reclaim wavering Tories from Mr Farage’s Brexit army? And who better to lead the charge against Mr Corbyn’s Leninist-Lennonist troops?

More thoughtful Conservatives wonder if Mr Johnson might be the ideal vehicle for absorbing and civilising the populist furies that threaten to take the country to a dark place. The Tories have an admirable record of co-opting social movements that destroyed similar parties in other countries, such as the clamour for democracy in the late 19th century and the creation of a welfare state after the second world war. Mr Johnson may represent a chance to do the same with populism. He insists that Brexit is at its heart a liberal rather than a populist project, which will open Britain to the world rather than keeping it imprisoned in fortress Europe. He enthusiastically supports a credo issued by the newly formed One Nation Group of 60 moderate Tory MPs. So it is easy to see why Tories are contemplating taking a punt. Surely a flash of genius is better than mediocrity, even if it is part of a combustible mixture? And surely the fact that three big bets in the past paid off handsomely suggests that it is worth making another one? Den Rest des Beitrags lesen »

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Who Needs Google’s Android? Huawei Trademarks Its Own Smartphone OS

Posted by hkarner - 25. Mai 2019

Date: 24-05-2019
Source: The Wall Street Journal

Chinese tech giant plans to launch its own operating system this year as access to U.S. software is hit by export ban

Huawei last week was granted a trademark, ‘Hongmeng,’ for its operating system.

Huawei Technologies Co. is pinning its hopes on a self-designed operating system to replace Google’s Android following a U.S. blacklisting. The question is: Can it succeed where others have failed?

Huawei last week was granted a trademark, “Hongmeng,” for the operating system by the trademark office of China’s National Intellectual Property Administration. The company has been working on the system under the code name “Project Z” as an insurance policy in case it lost access to American technology like Android, which powers Huawei’s popular smartphones, and hopes to release it later this year.

That scenario happened when Google was forced to cut off access to software after the U.S. Commerce Department placed Huawei on its “entity list,” banning the transfer of U.S. technology to the Chinese company without a license, on the grounds of national security.

Persuading users to switch operating systems is notoriously difficult. Several tech companies including Samsung Electronics Co. and Microsoft Corp. have built homemade alternatives to Android but they never caught on with smartphone users. The market is effectively a duopoly, with Android running on 87% of smartphones sold in the first quarter, and Apple’s iOS running on almost all of the rest, according to market research firm Canalys. Den Rest des Beitrags lesen »

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Should Germany borrow to invest?

Posted by hkarner - 25. Mai 2019

Date: 23-05-2019
Source: The Economist

Politicians and academics clash over the debt brake

Outside the headquarters of the German Taxpayers’ Federation in Berlin, a display tracks the public debt in real time. Now displaying a total of just under €2trn ($2.2trn), it has been ticking down since early 2018. Germany’s public-debt ratio, expected to be 58% of gdp in 2019, is as much the envy of other rich countries as its engineering prowess. Thanks to rising labour-market participation, says Michael Hüther of the German Economic Institute, a think-tank, tax revenues per head reached their highest level ever, in real terms, in 2018.

Even so, Germany’s fiscal policy is becoming a subject of debate. Olaf Scholz, the finance minister, has warned that the “fat years” are over. Economic growth is projected to slow this year, reducing the tax take. If he is to meet Germany’s stringent fiscal rule, he must rein in public spending.

The Schuldenbremse (debt brake) was enshrined in the constitution in 2009, when the financial crisis was expected to swell public debt beyond 80% of gdp. It restricts the federal-government deficit to no more than 0.35% of gdp a year unless a downturn hits; any overshoot beyond that must be made up in better times. (The debt brake also affects states’ finances: from 2020, they will be forbidden to run structural deficits.) Some economists, though, are asking whether the rule is a good one. Pointing to Germany’s rock-bottom interest rates and crumbling infrastructure, they argue that the country needs more debt-financed investment. Den Rest des Beitrags lesen »

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Big tech and the trade war

Posted by hkarner - 25. Mai 2019

Date: 23-05-2019
Source: The Economist

As the fight spreads, it is becoming a danger to investors, consumers and American interests

When trade talks between America and China fell apart on May 10th, the effect on financial markets was muted. Most firms and investors are betting on a long struggle between the superpowers but not a sudden crisis or a financial panic. As the conflict over the tech industry escalates, however, that assumption looks suspect. On May 15th America’s Commerce Department said that companies would need a special licence to deal with Huawei, China’s hardware giant, which it deemed a threat to American interests (it later said the order would not take full effect for 90 days). Fears that other Chinese tech firms will be blacklisted have caused their shares to tumble. A chain reaction is under way as a giant industry braces for a violent shock.

The hawks in the White House may believe that isolating the tech industry will slow China’s long-term development and that isolation is a good negotiating tactic, since China has more to lose in the short term than America does. In fact the brutal fallout from a full-blown tech war would rapidly be felt by financial markets as well as by America’s allies and the world’s consumers. In the long run it may even make China self-sufficient. Den Rest des Beitrags lesen »

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