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Posts Tagged ‘Security’

Coming Clean in 2018

Posted by hkarner - 13. Dezember 2017

Lucy P. Marcus, founder and CEO of Marcus Venture Consulting, Ltd., is Professor of Leadership and Governance at IE Business School and a non-executive board director of Atlantia SpA.

US President Richard Nixon and many of his aides learned during the Watergate scandal that the cover-up makes the original mistake ten times worse. In 2018, the Trump administration – and companies like Uber and 21st Century Fox – will ignore that lesson at their peril.

LONDON – It has been a bumper year for making the invisible visible. The last 12 months have overflowed with leaks, allegations, and other disclosures, not just of misconduct by individuals, business leaders, and politicians, but also of proactive schemes to prevent that misconduct from ever coming to light.

Last month, it came out that a 20-year-old hacker breached Uber’s system in 2016 and accessed the information of about 57 million people, including some 600,000 of its drivers in the United States. Rather than admit to the security flaw, Uber quietly paid the culprit $100,000 to destroy the data, in the hope that the victims – and, perhaps more important to Uber, the company’s investors – would never find out. Den Rest des Beitrags lesen »

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A Silver Lining for a Hard Brexit

Posted by hkarner - 21. November 2017

Jacek Rostowski was Poland’s Minister of Finance and Deputy Prime Minister from 2007 to 2013.

During a time of American waywardness under US President Donald Trump, the United Kingdom’s national security has increasingly come to depend on the European Union as a buffer against Russian revanchism. Ironically, then, the safest form of Brexit might be the one that hurts the most, so long as it leaves behind a stable EU.

LONDON – It is easy to forget that defense and security are not the same thing. Defense is what countries must resort to when their security breaks down. And during peacetime, countries spend money on defense precisely because they fear for their security.

In 1994, Russia agreed to defend Ukraine’s territorial integrity in exchange for Ukraine’s handover of the nuclear weapons it had inherited from the Soviet Union. But Russia didn’t stop with Crimea; since then, it has waged a low-intensity unconventional war against Ukraine in the country’s eastern Donbas region. Den Rest des Beitrags lesen »

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Here we go again!

Posted by hkarner - 23. Oktober 2017

Date: 22-10-2017
Source: The Wall Street Journal
Subject: Hunt for Yield Fuels Boom in Another Complex, Risky Security

Volumes of collateralized loan obligations, which slice and dice risky, leveraged bank loans, hit a record so far this year

Return-starved investors are piling back into securities that rely on financial engineering to juice returns.

As investors hunt for yield in global markets, acronyms are back.

Complex structured investments got a bad rap during the credit crunch, and products such as collateralized debt obligations, or CDOs, entered financial-crisis lore. Ten years on, return-starved investors are overcoming their skepticism to pile back into securities that rely on financial engineering to juice returns. Den Rest des Beitrags lesen »

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U.K.’s Challenge: Reconciling Its Brexit Aims

Posted by hkarner - 4. April 2017

Date: 03-04-2017
Source: The Wall Street Journal By SIMON NIXON

Prime Minister Theresa May needs a deal that achieves three objectives. But the objectives may be irreconcilable

After nine months of phony war, the Brexit battle lines have been drawn.

Last week’s opening salvos were cloaked in generous diplomatic language. British Prime Minister Theresa May used her letter invoking Article 50 of the Lisbon Treaty to laud Europe’s liberal democratic values and declared her wish for a “deep and special partnership” with the European Union.

EU Council President Donald Tusk reciprocated by declaring the Brexit negotiations an exercise in “damage control” with the goal of keeping the U.K. as close a partner as possible.

The desire for an amicable divorce on both sides is sincere, not least because the consequences of a collapse of the legal frameworks underpinning current cooperation in areas such as trade, finance, science and security would be so severe. Yet neither side is confident that the obstacles to a deal can be overcome.

The greatest obstacles lie within the U.K. itself. Mrs. May faces what may prove an impossible trilemma. Den Rest des Beitrags lesen »

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Cities for Migrants

Posted by hkarner - 27. August 2016

Photo of Peter Sutherland

Peter Sutherland

Peter Sutherland, United Nations Special Representative of the Secretary-General for International Migration and Development, is former Director General of the World Trade Organization, EU Commissioner for Competition, and Attorney General of Ireland. He will issue a report on improving international cooperation on migration later this year.

AUG 26, 2016, Project Syndicate

CORK – In many countries, particularly in Europe, immigration is increasingly framed as a security issue. Mainstream politicians, bowing to pressure from fear-mongering populists, are calling for tighter restrictions, and some countries are openly flouting their legal obligation and moral responsibility to provide protection to refugees fleeing conflict.

But the news is not all bad. Even as corrosive political discourse impedes effective action at the national and international levels, at the municipal level, progressive and effective immigrant-integration initiatives are flourishing. Den Rest des Beitrags lesen »

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Schengen and European Security

Posted by hkarner - 11. Dezember 2015

Photo of Daniel Gros

Daniel Gros

Daniel Gros is Director of the Brussels-based Center for European Policy Studies. He has worked for the International Monetary Fund, and served as an economic adviser to the European Commission, the European Parliament, and the French prime minister and finance minister. He is the editor of Economie Internationale and International Finance.

DEC 10, 2015, Project Syndicate

BRUSSELS – Another key European project is under threat. Some two decades after border controls were first abolished under the Schengen Agreement – which now includes 26 countries, including four non-members of the European Union – Germany has reinstated controls at its border with Austria, and France at its border with Belgium. The controls are meant to be temporary, and the vast majority of other borders remain open. But more openness does not seem to be the direction in which Europe is headed – and that is a serious problem.

The shift away from a “Europe without borders,” instigated by images of refugees walking across internal frontiers, was fortified by the news that most of those who carried out last month’s Paris attacks came from Belgium, and that some may have entered the EU via the Balkans, posing as refugees. The underlying assumption – reinforced by many European politicians, especially interior ministers – is that there is a tradeoff between security and openness. This is far from accurate. Den Rest des Beitrags lesen »

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Angriff auf die Infrastruktur: Gefahr für die Weltmarktführer

Posted by hkarner - 19. September 2015

Date: 18-09-2015
Source: Die Zeit

Die deutsche Industrie digitalisiert ihre Anlagen in Hochgeschwindigkeit. Das verspricht reichlich Profit – für Hacker und Kriminelle.

Digital, Angriff auf die Infrastruktur, Industrie, Digitalisierung, Hacker, IT-Sicherheit

Porsche LeipzigGroße Teile der Autoproduktion haben längst computergesteuerte Roboter übernommen, so hier im Porsche-Werk in Leipzig.

Das größte Problem der deutschen Industrie steckt in einer Frage. Sie lautet: „Wie lange hält diese Maschine hier?“ Der Ingenieur antwortet: „Mindestens zwanzig Jahre, eher länger“. Der Programmierer sagt: „Bis zum nächsten Sicherheitsupdate in drei Monaten, vielleicht kürzer.“

Deutschlands wirtschaftliche Stärke gründet auf seiner Industrie. Auto- und Maschinenbauer, Chemiker, Elektrotechniker und Metallverarbeiter geben Tausenden von Menschen Arbeit. Ihre Produkte stellen sie in Fabriken her, deren hochkomplexe Anlagen oft über Jahre oder sogar Jahrzehnte ohne Unterlass laufen und gleichbleibende Qualität abliefern. So war es bisher. Doch damit könnte schnell Schluss sein.

Die Industrie digitalisiert sich in rasender Geschwindigkeit. Maschinen lernen, miteinander zu kommunizieren – nicht nur innerhalb einer Fabrik, sondern über verschiedene Standorte und sogar über Grenzen hinweg. Roboter in der Produktion merken, wenn das Material zur Neige geht und funken eigenständig nach Nachschub. Oft wissen nur noch Computer, wo in den gigantischen Lagern das gesuchte Bauteil liegt. Längst ist von einer Revolution die Rede und von einem Schlagwort: Industrie 4.0. Es verspricht goldene Zeiten für mutige Unternehmer. Und für Kriminelle. Den Rest des Beitrags lesen »

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Division and crisis risk sapping the west’s power

Posted by hkarner - 3. September 2014

Date: 02-09-2014
Source: The Financial Times By Gideon Rachman

America’s allies have come to rely excessively on the US to guarantee their security

The people who prepare President Barack Obama’s national security briefing must be wondering what to put at the top of the pile. Should it be the Russian assault on Ukraine, or the advance of the Islamic State of Iraq and the Levant (known as Isis) in Iraq and Syria? And what items should go just below that?

The violent anarchy in Libya, the dangerous stalemate in Afghanistan, the looming political crisis in Hong Kong, or a confrontation between Chinese and US planes, near Hainan island?

The US president might reasonably ask why all these crises are breaking out at the same time. His critics have a ready answer. They argue that the Obama administration has shown itself to be weak and indecisive. As a result, America’s adversaries are testing its limits and the US-led security order is under challenge in Europe, the Middle East and Asia.

There is no doubt that the US is war-weary after the conflicts in Iraq and Afghanistan. However, the multiplication of security crises around the world is not just about Mr Obama and the US. In fact, the obsession with what the Americans are doing points to the underlying problem. Its allies have come to rely excessively on the US to guarantee their security. Den Rest des Beitrags lesen »

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The Global Security Deficit

Posted by hkarner - 13. August 2014

Date: 12-08-2014
Source: Project Syndicate

MICHAEL SPENCESpence CC

Michael Spence, a Nobel laureate in economics, is Professor of Economics at NYU’s Stern School of Business, Distinguished Visiting Fellow at the Council on Foreign Relations, Senior Fellow at the Hoover Institution at Stanford University, and Academic Board Chairman of the Fung Global Institute in Hong Kong. He was the chairman of the independent Commission on Growth and Development, an international body that from 2006-2010 analyzed opportunities for global economic growth, and is the author of The Next Convergence – The Future of Economic Growth in a Multispeed World.

FORT LAUDERDALE – Summer is normally a time to take a break from the risks and worries of everyday life, and perhaps to take stock of where we are and where we are heading. But this is increasingly difficult, because our everyday lives are becoming so much riskier and more worrying.

Much of the discussion in the period following the 2008 financial crisis focused on various economic imbalances that either threatened or impeded growth. These issues have not gone away. The US economy’s surprisingly weak performance in the first quarter, for example, has left analysts confused and uncertain about its trajectory.

But, to an increasing extent, political insecurity, potential conflict, and deteriorating international relations pose a greater threat to economic progress than the post-crisis debate foresaw.

Asia, a bright spot in terms of growth in the post-crisis years, is now experiencing rising tensions that jeopardize regional trade and growth. Japan’s somewhat fragile recovery could be derailed by an escalation of its territorial conflict with China, which is both a major market for Japanese goods and deeply integrated into Japanese firms’ supply chains.

While territorial disputes often are historically and politically important, their economic significance is usually minor, even minuscule, unless tensions like those in the East and South China Seas are allowed to get out of hand. America’s ambiguous role in Asian security – owing to its interest in supporting its regional allies while not antagonizing China – contributes to the uncertainty.

Aside from their strategic minuet in Asia, China and the United States are engaged in a cyber-security battle that is already starting to affect flows of goods, investment, and technology. On both sides, stated commitments to resolve the issue cooperatively have not produced significant results. And disputes over electronic surveillance have caused tension between the US and Europe.

The Middle East, meanwhile, has entered a period of extreme instability that will surely have negative economic effects both regionally and globally. And the tug of war between Russia and the West over Ukraine and other former Soviet satellites will adversely affect European regional stability, energy security, and economic growth.

The downing of Malaysia Airlines Flight 17 over eastern Ukraine – and, more recently, the suspension of commercial flights to Tel Aviv – adds a new dimension of uncertainty. When civilian air traffic is no longer safe from attack, one may legitimately wonder about the effectiveness of the basic systems of governance that underpin global commerce.

Indeed, the World Trade Organization is once again in jeopardy, with the Indian government threatening to veto the Agreement on Trade Facilitation reached in Bali last year, owing to disagreements about food stockpiling and subsidies. A loss of confidence in the WTO would be a major blow to an institution that plays a vital role in securing international cooperation and regulation.

The global economy is a far more highly interconnected place than it was 40 years ago. The cross-border flows of goods, information, people, and capital that are its lifeblood rely on a threshold level of safety, stability, and predictability. It is this threshold that appears to be under threat. Continued economic progress in the developing world and recovery in the developed countries requires preventing local and regional conflict from delivering large systemic shocks.

In terms of priorities, it is arguably more important for G-20 governments to strengthen the core systems that enable global flows than it is to address strictly economic issues. Moreover, there is a clear, shared interest in doing so: No one benefits from the expansion of systemic risk.

Failure to contain the impact of regional conflicts and bilateral frictions may lead to more than just supply shocks in areas like energy. The principal effect is likely to be a series of negative demand shocks: investors withdrawing, travelers staying home, and consumers closing their wallets. In a global economy in which aggregate demand is a key growth constraint, that is the last thing the system needs.

We have gone about as far as we can with a global system that is at best partly governed and regulated. As the global order defined by the Cold War (and then by a briefly dominant America) recedes into history, a new set of institutions and agreements must be developed to protect the core stability of the system.

That is easier said than done. But the starting point is to recognize the broad-based damage to the global economy’s prospects that failure to address the issue implies. Ineffective regulation in areas like food safety, infectious diseases, cyber security, energy markets, and air safety, combined with the inability to manage regional tensions and conflict, will undermine global flows and reduce prosperity everywhere.

In a way, the current global environment is a classic case of negative externalities. The localized costs of suboptimal behavior – the ones one might expect to be internalized – fall well short of the overall global costs.

Several more narrowly economic issues – for example, defective growth patterns, underinvestment in tangible and intangible assets, and the absence of reforms designed to increase structural flexibility – remain a cause for concern, because they underpin subpar growth.

But, at this moment in history, the main threats to prosperity – those that urgently need world leaders’ attention and effective international cooperation – are the huge uncontained negative spillover effects of regional tensions, conflict, and competing claims to spheres of influence.
The most powerful impediment to growth and recovery is not this or that economic imbalance; it is a loss of confidence in the systems that made rising global interdependence possible. Den Rest des Beitrags lesen »

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A Great Breakdown?

Posted by hkarner - 13. August 2014

Date: 12-08-2014
Source: Project Syndicate

KEMAL DERVIS640px-Kemal_Dervis cc

Kemal Dervis, former Minister of Economic Affairs of Turkey and former Administrator for the United Nations Development Program (UNDP), is a vice president of the Brookings Institution.

ISTANBUL – This month – the centenary of the outbreak of World War I – is an opportune time to reflect on big risks. As Michael Spence recently warned, the international order’s widening security deficit, reflecting the weakening of whatever global governance we have, is fast becoming the biggest risk facing the world economy. The same point could have been made a century ago.

On July 30, 1914, Austrian warships bombarded Belgrade, five weeks after the assassination of Archduke Franz Ferdinand in Sarajevo. By mid-August, the world was at war. The armistice that was agreed four years later, after about 20 million people had died, amounted only to an interlude before the horror of World War II.

In the years preceding August 1914, until the assassination of the archduke, the global economy performed relatively well: trade expanded worldwide, financial markets seemed healthy, and the business community shrugged off political problems as either temporary or irrelevant. It was a political breakdown that led to three terrible decades for the world economy.

Markets and economic activity can withstand a great deal of political stress and uncertainty – up to the point that the international order breaks down. Today, for example, the economic mood is rather upbeat. The International Monetary Fund forecasts 4% growth for the world economy in 2015, while stock-market indices are up in many parts of the world; indeed, the Dow Jones reached an all-time high in July.

In the last few months, however, a civilian airliner was downed in eastern Ukraine by a sophisticated Russian-made missile, tensions have increased around disputed islands in the South and East China Seas, and chaos in the Middle East has continued to spread. The Israeli-Palestinian conflict is in one of its worst phases in decades, with the renewed frustration unleashed by the massive loss of civilian life in Gaza likely to encourage extreme reactions. Terrorists may be on the verge of designing much less detectable weapons.

There are other, less “political” dangers. West Africa is afflicted by a terrible outbreak of the deadly Ebola virus, which will kill thousands of people. The outbreak has so far remained regional, but it serves as a reminder that in an age of air travel by millions, no one is safe from the spread of infectious disease. Containing a disease or a terrorist threat by curtailing international travel or transport would devastate the world economy.

Thinking about August 1914 should remind us that great catastrophes can materialize gradually. Leaders can be “sleepwalkers” who fail to manage risk by, say, establishing institutions that can channel the rival interests and claims that fuel international conflict. Such sleepwalking by policymakers caused the financial meltdown of 2008 as well. Its consequences were not as deadly, though the political effects of mass unemployment and the heightened perception of economic insecurity are still with us.

These examples should spur the world to find ways forward for cooperative action. But the opposite appears to be happening. The United Nations seems more paralyzed than ever. The US Congress still has not approved the IMF reform package agreed in 2010, weakening one of the most important international institutions. Partly because the United States makes capital increases and governance reforms in global financial institutions so difficult, the BRICS countries (Brazil, Russia, India, China, and South Africa) have launched their own development bank, to be based in Shanghai.

Likewise, instead of providing a shining example of supranational cooperation and pooled sovereignty for the twenty-first century, the European Union remains mired in rather petty disputes. While it still cannot fully agree on the design of its banking union, it is allowing Prime Minister Viktor Orbán of Hungary, a member country, to denigrate the democratic and liberal values upon which the EU rests.

The way forward cannot be a return to the past, with its clashing nation-states. The future can be secured only by strong cooperation among all those committed to liberal democracy and the rule of law, with no double standards or excuses, and by patient strengthening of international institutions that embody these values and can translate them into practice.

Whenever a global or regional power acts in a way that contradicts these values, or allies itself closely with those who do, it undermines the international order, which should deliver security and increasing prosperity (and to some degree has).
The global economy holds great promise, but it is a promise that can be realized only in an international system based on rules, consent, respect, and a shared sense of justice.

The fact that neither the mayhem in the Middle East nor the crisis in Ukraine seem to touch financial markets should not lull us into complacency. The memory of August 1914 should remind us how the world stumbled into catastrophe. As we know – or should know – from the example of climate change, big risks must be managed, even if the probability of worse-case outcomes is low. Den Rest des Beitrags lesen »

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