12 dead in bank robbery attempts, police shootout in Brazil

(THIS ARTICLE IS COURTESY OF THE BOSTON HERALD)

 

12 dead in bank robbery attempts, police shootout in Brazil

Forensic officers load the body of a victim killed in an attempted bank robbery, at an entrance of a municipal hospital in Milagres, in Brazil’s state of Ceara, Friday, Dec. 7, 2018. Brazilian authorities say that at least 12 people have been killed in two attempted bank robberies in Milagres downtown area. (Antonio Rodrigues/Diario do Nordeste via AP)

PUBLISHED:  | UPDATED: 

By MARCELO SILVA DE SOUSA

RIO DE JANEIRO (AP) — At least 12 people, including two children, were killed Friday when police engaged in a shootout with bank robbers, according to authorities in northeastern Brazil.

The two attempted heists in the state of Ceara began around 2:30 a.m. in the downtown area of the city of Milagres, police said in a statement.

News portal G1 reported that the robbers blocked off a road into the downtown and took hostages as they began entering two banks on the same street. When police responded, a firefight ensued, leading to several deaths.

Lielson Macedo Landim, the mayor of Milagres, told G1 the hostages were executed by the criminal group and not killed by police fire. Macedo Landim said that two children, between 10 and 13 years old, were among the dead hostages.

His account could not be immediately verified, as police did not respond to numerous email and phone requests for more information about the shootout or how the hostages died.

Two suspects were apprehended, and several fled, according to the police statement. Authorities also seized three vehicles, several firearms and explosives.

Andre Costa, secretary of public security in Ceara, said that six of the dead were the attackers. Authorities have yet to release identities of the dead.

To search for the remaining would-be robbers, the city announced on its Facebook page that it was suspending public services and urged residents to remain in their homes.

Latin America’s largest nation routinely is the world leader in total annual homicides. Ceara is one of the country’s most violent states.

India: Country passing through rising intolerance says former President Pranab Mukherjee

(THIS ARTICLE IS COURTESY OF THE INDIAN NEWS AGENCY THE HINDUSTAN TIMES)

 

‘Country passing through rising intolerance,’ says former President Pranab Mukherjee

Pranab Mukherjee expressed concern over rising intolerance and violation of human rights, coupled with a widening gulf between the rich and poor with top one percent rich pocketing the lion’s share of country’s wealth.

INDIA Updated: Nov 24, 2018 13:42 IST

Indo Asian News Service
Indo Asian News Service
Indo Asian News Service
Former President Pranab Mukherjee addressed the National Conference on ‘Towards Peace, Harmony and Happiness: Transition to Transformation’, in New Delhi on Friday, November 23, 2018.(PTI)

Former President Pranab Mukherjee on Friday expressed concern over rising intolerance and violation of human rights, coupled with a widening gulf between the rich and poor with top one per cent rich pocketing the lion’s share of country’s wealth.

He was speaking at the inauguration of the two-day national conference on “Towards Peace, Harmony and Happiness: Transition to Transformation”, organised by Pranab Mukherjee Foundation along with the Centre for Research for Rural and Industrial Development (CRRID).

“The land which gave the world the concept of ‘Vasudhaiva Kutumbakam’ and the civilisational ethos of tolerance, acceptance and forgiveness, is now in news for rising levels of intolerance, manifestations of rage and infringement of human rights,” Mukherjee said.

“Peace and harmony prevails when a nation celebrates pluralism, practices tolerance and promotes goodwill among diverse communities and when we purge the toxin of hatred, envy, jealousy and aggression from our everyday lives,” he said.

He said “happiness is higher in countries that ensure their inhabitants basic amenities and resources, greater security, autonomy and freedom as well as sufficient educational opportunities and access to information. People are manifestly happier in countries where personal freedoms are guaranteed and democracy is secured.”

“Regardless of economic conditions, citizens are happy in a climate of peace,” Mukherjee said.

Referring to the statistics, he said, “If these statistics are anything to go by, we appear to be caught in a ‘rising economy, receding happiness’ syndrome. Our growth paradigm calls for an urgent look.”

Paying tributes to Guru Nanak Dev on his 549th birth anniversary, Mukherjee said given the times we are living in, it is important to recall his message of “peace and oneness”.

He also recalled what Chanakya said that “In the happiness of the people lies the happiness of the king” and the Rig Veda saying that we must live in one assembly, speak in one voice, with our minds in accord.

In a poser he asked whether the state was functioning in conformity with the preamble of the Constitution guaranteeing socio-economic and political justice, liberty of expression and thought and the equality of status and of opportunity, Mukherjee said that on the ranking of the happiness of common man, India ranks at 113, on the index of hunger, India is at 119. Similar is the situation on the rating of malnutrition, suicides, inequality and economic freedom.

Mukherjee said, “We need a State that inspires confidence among people in its ability to surmount challenges before us. We need the media and citizens, who even as they claim their rights, are equally committed to their responsibilities.”

Referring to the Parliament, Executive and the Judiciary, Mukherjee said in recent past these institutions have come under “severe stress” and their credibility is being questioned.

He said “There is a widespread cynicism and disillusionment with the governance and the functioning of these institutions.”

However, former President said that to “save democracy”, it was incumbent upon these institutions to “win back the trust of the people, without any delay.”

Former Union Minister and BJP veteran Murli Manohar Joshi in his valedictory address described as “disturbing” the merging scenarios where the “techno-economic system adopted to produce a democratic egalitarian world order has resulted in an exploitative, extremely unequal and fragmented world”.

“Mankind today is, therefore, unhappy, more turbulent, more violent, more fundamentalist and more alienated than ever before”, Joshi said.

The root cause of this “out of balance world” needs to be investigated, the veteran leader said.

First Published: Nov 24, 2018 09:49 IST

China to help Pakistan avert fiscal crisis: One Demon Bailing Out Another: For A Price

(THIS ARTICLE IS COURTESY OF AL-JAZEERA NEWS AGENCY)

 

China to help Pakistan avert fiscal crisis, ‘more talks needed’

Pakistan’s foreign reserves have dwindled, causing PM Khan to decry the financial situation he inherited.

The last time Pakistan received an IMF bailout was in 2013, when it received $6.6bn [Jason Lee/Reuters]
The last time Pakistan received an IMF bailout was in 2013, when it received $6.6bn [Jason Lee/Reuters]

China is willing to provide Pakistan with economic aid to help it deal with its deteriorating finances but more discussions are needed on the details, according to a top Chinese diplomat.

The comments on Saturday by Vice Foreign Minister Kong Xuanyou came after a meeting in Beijing between Chinese Premier Li Keqiang and new Pakistani Prime Minister Imran Khan.

Pakistan’s foreign reserves have plunged 42 percent since the start of the year and now stand at about eight billion dollars, or less than two months of import cover.

Late last month, Saudi Arabia pledged to give Pakistan a six billion dollars rescue package, but officials say it is not enough and the country still plans to seek a bailout from the IMF to avert a balance of payments crisis.

It would be Pakistan’s 13th rescue package from the multilateral lender since the late 1980s.

Speaking to reporters in Beijing’s Great Hall of the People following Khan’s talks with Li, Kong said his country would help.

“During the visit, the two sides have made it clear in principle that the Chinese government will provide necessary support and assistance to Pakistan in tiding over the current economic difficulties,” Kong said.

“As for specific measures to be taken, the relevant authorities of the two sides will have detailed discussions,” he added, without giving details.

Pakistan’s fiscal crisis partly comes from limited restraints on spending and a failure to institute genuine tax reform [Akhtar Soomro/Reuters]

Khan, whose party swept Pakistan’s July elections, told Chinese President Xi Jinping the previous day that he had inherited “a very difficult economic situation” at home.

Though China is Pakistan’s closest ally, Khan’s newly elected government has sought to re-think the two countries’ signature project, the $60bn China-Pakistan Economic Corridor (CPEC), which Beijing touts as the flagship infrastructure programme in its vast Belt and Road Initiative.

Pakistan has looked to amend CPEC to put greater emphasis on projects that focus on social development, rather than purely on infrastructure.

In his meeting with Li, Khan invited the Chinese premier to visit Pakistan and see for himself the difference the megaproject has made in the country.

“CPEC in 2013 was just an idea. Now, it is on the ground. And it has caught the imagination of the people of Pakistan,” he said.

“We feel that this a great opportunity for our country to progress, to attract investment. It gives us an opportunity to raise our standard of living, growth rate.”

For his part, Li praised the relationship, saying “China and Pakistan are all-weather partners.”

Commenting on CPEC, Kong said there were no plans to scale back the economic corridor, but he added that it would be altered somewhat to “tilt in favour of areas relating to people’s lives”.

Meanwhile, Khan’s office said in a statement that the two governments had signed a number of agreements and memoranda of understanding in the fields of agriculture, poverty reduction, forestry, law enforcement and socioeconomic development.

A history of the IMF

EMPIRE

A history of the IMF

SOURCE: AL JAZEERA AND NEWS AGENCIES

The Chinese century is well under way

(THIS ARTICLE IS COURTESY OF THE ECONOMIST)

 

 

The Chinese century is well under way

Many trends that appear global are in fact mostly Chinese

When scholars of international relations predict that the 2000s will be a “Chinese century”, they are not being premature. Although America remains the lone superpower, China has already replaced it as the driver of global change.

There is one economic metric on which China already ranks first. Measured at market exchange rates, China’s gdp is still 40% smaller than America’s. However, on a purchasing-power-parity (ppp) basis, which adjusts currencies so that a basket of goods and services is worth the same amount in different countries, the Chinese economy became the world’s largest in 2013. Although China is often grouped with other “emerging markets”, its performance is unique: its gdp per person at ppphas risen tenfold since 1990. In general, poorer economies grow faster than rich ones, because it is easier to “catch up” when starting from a low base. Yet in other countries that were as poor as China was in 1990, purchasing power has merely doubled.

China’s record has exerted a “gravitational pull” on the world’s economic output. The Economist has calculated a geographic centre of the global economy by taking an average of each country’s latitude and longitude, weighted by their gdp. At the height of America’s dominance, this point sat in the north Atlantic. But China has tugged it so far east that the global centre of economic gravity is now in Siberia.

Because China is so populous and is developing so quickly, it is responsible for a remarkable share of global change. Since the start of the financial crisis in 2008, for example, China has accounted for 45% of the gain in world gdp. In 1990 some 750m Chinese people lived in extreme poverty; today fewer than 10m do. That represents two-thirds of the world’s decline in poverty during that time. China is also responsible for half of the total increase in patent applications over the same period.

For all its talk of a “peaceful rise”, China has steadily beefed up its military investment—even as the rest of the world cut back after the end of the cold war. As a result, the People’s Liberation Army accounts for over 60% of the total increase in global defence spending since 1990. And all of this growth has come at a considerable cost to the environment: China is also the source of 55% of the increase in the world’s carbon emissions since 1990.

Sources: Economist Intelligence Unit; Global Carbon Project; Maddison Project Database; SIPRI; World Bank; World Intellectual Property Organisation; The Economist
Get the data

This article appeared in the Graphic detail section of the print edition under the headline “Well under way”

Theology Poem: Their Is Only One Thing We Own

Their Is Only One Thing We Own

 

We bought us a Hector of land about 3 yrs ago

It even had a three bedroom planted upon its face

We’re even blessed with two old sleds, but they ride

Could we all be more alive if we just owned more toys

Own the Business, but, do we really ever own the fame

 

There are many generations of those whom have owned this land

How many striped backs have worked this very place that I stand

Grass to timber, back to grass, then back to trees, again and again

Did a Red Man before me own it, if so, which people were they of

Did a Cave Man or maybe a Monkey or even a Chimp lay claim to it

 

Do the Trees think they own the Stars as well as the Ground below

The Skies hold the Rain but are the Skies beholding to the night breeze

How is it that I think to my self, yes I do own this, and I also own that

The Air owns the Man, the Man has never been in control of his Air

The Only Thing that We Own is Our Own Name, waiting in Line Up There

Lebanon Stresses Compliance With US Measures Against Hezbollah

(THIS ARTICLE IS COURTESY OF THE SAUDI NEWS AGENCY ASHARQ AL-AWSAT)

 

Lebanon Stresses Compliance With US Measures Against Hezbollah

Friday, 28 September, 2018 – 09:45
Central Bank Governor Riad Salameh delivers a speech during the plenary session of the Annual Meetings of the International Monetary Fund and the World Bank Group in Tokyo. REUTERS/Yuriko Nakao
Beirut – Nazeer Rida
The new US draft-law on Hezbollah is moving to an advanced stage involving media funders, economic and social institutions linked to the group, in what seems to be “an attempt to isolate the supporters of the party, which is facing increased financial pressure,” according to experts.

The new draft-law imposes sanctions on the supporters of “Bayt al-Mal” and “Jihad Al-Bina”, which is involved in construction works, as well as the party’s media institutions, and includes advertisers who broadcast ads through Hezbollah’s channels.

While the bill seeks to “increase pressure on banks dealing with the group,” Central Bank Governor Riad Salameh said on Thursday in response to a question about his willingness to enforce the sanctions: “We, as the central bank, issued circulars a while ago, and there aren’t new notices.” He explained and these circulars make Lebanon comply with the laws of countries that have currency or banks dealings with it.

He pointed out in a radio interview that those circulars were sufficient enough whatever the new sanctions, adding that there was nothing new on this subject.

The US House of Representatives unanimously voted to pass a bill calling for new and harsh sanctions against Hezbollah. The new sanctions aim to limit the party’s ability to raise funds and recruit members, as well as increase pressure on the banks that deal with the group and the countries that support it, especially Iran. The sanctions also prohibit anyone who supports the party materially and in other means from entering the United States.

According to Dr. Sami Nader, Director of Levant Institute for Strategic Affairs (LISA), the new bill shows that the circle of sanctions is widening, since it started with Hezbollah’s officials, then reached the entities associated with the party, and today includes the supporters of the group’s institutions.

 

 

Workers with low levels of education still haven’t recovered from the Great Recession

(THIS ARTICLE IS COURTESY OF THE BROOKINGS BRIEF)

 

Workers with low levels of education still haven’t recovered from the Great Recession

Lauren Bauer and Jay Shambaugh

Over a decade after the start of the Great Recession, most Americans looking for a job can find one—the unemployment rate has fallen to around 3.9 percent. Also, following a decline in labor force participation that pre-dated but continued through the Great Recession, the share of Americans aged 25-54 in the labor market has increased in the last few years.

Despite these positive developments, the labor market is not perfect. Wage growth is still sluggish, with modest gains offset by inflation. Despite recent increases, the share of prime-age Americans in the labor force is still slightly below the pre-Recession level. Levels of unemployment vary widely across places and the population by key demographic characteristics.

In August of last year, The Hamilton Project calculated that the “jobs gap”—the difference between demographically adjusted national employment and its level before the recession—had closed for the country overall. That is, after adjusting for demographic shifts, the economy had added enough jobs to fill the hole left by the Great Recession.

But not every group of Americans has fully recovered from the Great Recession. In this piece, we provide an annual update of the employment rate gap, which is different from the jobs gap, by race/ethnicity and level of education.

CALCULATING EMPLOYMENT RATE GAPS 

Using the Current Population Survey from January 2007 to May 2018, we identify the “employment rate gap:” the difference between the demographically adjusted 2007 employment-to-population ratio and the actual employment-to-population ratio at a given point in time. It should be noted that this methodology differs from that used for The Hamilton Project’s previous monthly jobs gap series.1 Because we are exploring differential trends by demographic characteristics, we cannot use payroll employment from the Current Employment Statistics, as the “jobs gap” did.

RECOVERING FROM THE GREAT RECESSION

Figure 1 shows that, in the depths of the Great Recession, blacks and Hispanics faced much steeper job losses than their white counterparts. What this figure also shows, though, is that blacks and Hispanics recovered from the recession much more quickly, and ultimately closed their employment rate gap before non-Hispanic whites did. Once we account for demographic change, the employment-to-population ratio for blacks is almost two percentage points above pre-recession levels.

Demographically Adjusted Employment Rate Gap, by Race/Ethnicity

That said, we note that even with this higher rate of growth for blacks, they still experience lower levels of employment in absolute terms. In June 2018, 58.2 percent of African-Americans aged 16 and older were employed, compared to 60.6 percent of whites and 63.4 percent of Hispanics, and the unemployment rate for African-Americans was still nearly twice the rate it is for white Americans.

All three major ethnic groups have a demographically adjusted employment rate above the pre-crisis level, consistent with the demographically adjusted jobs gap having closed.

There are three reasons this may not signal an end to slack in the economy. First, as Americans live longer and the Social Security retirement age has increased, older Americans are working longer. The employment rate for 55-64 Americans is well above pre-recession levels while the prime age employment rate is still slightly below its November 2007 level. Second, as noted in Schanzenbach, Nunn, Bauer, and Breitwieser, the employment recovery from the 2001 recession was weak—arguably leaving labor market slack in 2007—such that recovering to the 2007 level may not mark the elimination of labor market weakness. Finally, given that more-educated Americans tend to have higher employment levels, one might have expected the increase in educational attainment from 2007 to 2018 to have raised the employment-to-population ratio. We therefore explore educational outcomes next.

Demographically Adjusted Employment Rate Gap, by Level of Education

Those with less education were disproportionately harmed by the Great Recession (figure 2).2 We see that graduate degree holders—and to a lesser extent bachelor’s degree holders—experienced smaller reductions in employment during the recession. For those with no postsecondary degree, the employment rate gap in 2011 was 5 percent or more, while it was just 2 percent for those with a bachelor’s degree.

Recovery from the bottom of the trough occurred earlier for those with more education. The first upturn among graduate degree holders was between 2009 and 2010, between 2010 and 2011 for those with a bachelor’s degree. By 2018, only those with bachelor’s or graduate degrees had returned to their demographically adjusted pre-recession employment rate.

The recession was particularly hard on those without a high school diploma. In 2010 and 2011, this group had an employment-to-population ratio that was fully six percentage points lower than in 2007. Those with a high school diploma and/or some college followed a similar trend through this period, with a slightly shallower trough during the worst of the recession than those who didn’t graduate from high school. In recent years, workers without a postsecondary degree have seen improving employment outcomes, though a gap remains.3

Not only have less-educated groups not recovered as fully from the recession, they started at lower levels of employment rates prior to the crisis such that at this point, amongst those aged 25 and higher, 72.5 percent of those with a bachelor’s degree work compared to just 55 percent of those with only a high school degree.

CONCLUSION

The Great Recession inflicted economic pain on many American families, but its burden was not equally distributed. Ultimately, the brunt of the Great Recession was borne by those without the protection of post secondary education. College raises average lifetime earnings, and it also helps insulate workers from economic downturns, providing economic security in the times they need it most. Finally, racial disparities have been less severe in recovery than in the worst years of the Great Recession, though differences in employment rates persist. For the American labor market to be truly healthy, it needs to work for all people—not just some.

Putin’s Kremlin subverting Israeli democracy?

(THIS ARTICLE IS COURTESY OF THE TIMES OF ISRAEL)

(FOLKS, THIS IS A VERY IMPORTANT ARTICLE, PLEASE TAKE A FEW MOMENTS TO READ THIS)

Is Putin’s Kremlin subverting Israeli democracy? A Russia expert thinks so

A devastating, complacency-shattering interview with Ilya Zaslavskiy, one of the world’s leading experts on Moscow’s overt and covert designs on the West

Main image by Amos Ben Gershom/GPO

WASHINGTON, United States — Despite the global headlines about Russian meddling in foreign elections, Israeli experts have thus far expressed little concern that it could happen here.

At Tel Aviv University’s CyberWeek cybersecurity conference in June, for instance, Israeli officials made light of the impact of fake news and foreign influence campaigns on Israeli society. Fake news is a “nuisance,” Eviatar Matania, head of the National Cyber Bureau in the Prime Minister’s Office, told a panel at the conference, not a major threat. Other speakers said they had seen no signs of Russian influence campaigns targeting Israel.

But the recent release by researchers at Clemenson University of three million Russian troll tweets created by Russia’s Internet Research Agency between 2012 and 2018 paints a different picture.

Reporters from Israel’s Channel 10 News found that tens of thousands of the tweets dealt with Israel and the region and some were written in Hebrew, indicating they were indeed targeting Israelis and people who care about Israel.

Ilya Zaslavskiy, a Washington, DC-based expert on Russia and head of research at the Free Russia Foundation — a nonprofit led by Russians abroad that says it “seeks to be a voice for those who can’t speak under the repression of the current Russian leadership” — told The Times of Israel that he would be extremely surprised if Russia weren’t carrying out covert influence campaigns in Israel.

“We now know for a fact that Russia has been interfering on a massive scale in US, German and UK elections and referendums,” said Zaslavskiy, who is also a member of the advisory board at the Hudson Institute’s Kleptocracy Initiative and an academy associate at Britain’s Royal Institute of International Affairs (Chatham House) think tank.

Ilya Zaslavskiy (Courtesy)

“We know that they intervened in the Catalonia referendum as well as a referendum on Ukraine in Holland. They continue to interfere in the US midterms and they have been meddling in all sorts of local elections in Eastern Europe. and the post-Soviet space,” he said. “So why wouldn’t they interfere in Israeli elections when Israel is so important to their strategic interests?”

Asked why Israel is of interest to Russia, Zaslavskiy, who is Jewish and immigrated to the United States from Russia as a young adult, said that “Israel is of strategic importance to the Kremlin  — because Israel is actually one of the forces that could contain Russia, could prevent some of the abuses that Russians are carrying out.”

He cited, for instance, developments in Syria. “Israel is not a great friend of Assad, but now the Israeli government has sort of accepted that Russians uphold him and have got a foothold in Syria,” he said. Asked how things could have been different, Zaslavskiy replied “Israel could have been more vocal and critical about Russia’s role in Syria.”

This December 11, 2017 photo shows Russian President Vladimir Putin, right, and Syrian President Bashar Assad watching troops march at the Hemeimeem air base in Syria. (Mikhail Klimentyev, Sputnik, Kremlin Pool Photo via AP)

More generally, “you could have expelled some of the Russian oligarchs, you could have prevented some of the money laundering,” he said. “You could actually impose some sanctions on Russia and limit their influence in your country.”

Why hadn’t that happened? During a deeply disconcerting interview in the US capital Zaslavskiy offered some insights. And as the conversation developed, he moved rapidly beyond election meddling to a wider, nightmare vision of an ascendant Russia, with Western democracies weakened and outflanked. Regarding Israel specifically, he described covert, Russian-led processes already unfolding that he believes are undermining the rule of law and democracy itself, and set out specific measures that he believes must urgently be taken if the decline is to be halted and contained.

An existential danger

Zaslavskiy believes that both Israel and the West face an existential danger from Russia unless the problem of covert and overt Russian influence is fully acknowledged and decisive measures are taken to combat it. He says most of the West fails to grasp the gravity of the threat, which includes not just efforts to meddle in elections but the exporting of corruption and criminality from post-Soviet countries to the West, thereby undermining democracy itself.

Russian President Vladimir Putin (R) with Israeli Prime Minister Benjamin Netanyahu during their meeting at the Kremlin in Moscow on July 11, 2018. (AFP/ Pool/Yuri Kadobnov)

In a recent report for the Hudson Institute’s Kleptocracy Initiative entitled “How Non-State Actors Export Kleptocratic Norms to the West,” Zaslavskiy argues that the West did not in fact win the Cold War and that its norms and values, like democracy and the rule of law, are very much in peril.

“When the Soviet empire collapsed in 1991, it was widely believed that Western-style democracy and liberal capitalism based on free elections, separation of powers and the rule of law would eventually take root in the Commonwealth of Independent States (CIS) and other regions emerging from the Cold War,” he writes. “Even when ex-Communist Party leaders and representatives of Soviet security services returned to power throughout the former Soviet Union (FSU) in the late 1990s to mid-2000s, mainstream political thought never once doubted the inevitability of democracy’s march across the globe. Experts debated speed and direction, but rarely questioned the ultimate destination.”

The West has largely failed to export its democratic norms and is instead witnessing an increasingly coordinated assault on its own value system

In reality, Zaslavskiy goes on, “the West has largely failed to export its democratic norms and is instead witnessing an increasingly coordinated assault on its own value system. This destructive import of corrupt practices and norms comes not only from post-Soviet kleptocratic regimes like Azerbaijan, Kazakhstan, and Russia, but also from China and other countries around the world whose ruling elites now possess far-reaching financial and political interests in the West.”

The new norms being exported to the West, which he dubs neo-Gulag norms, include the idea that those in power are the only real and rightful decision-makers and that the rest are ultimately “prison dust.”

Another such norm, he writes, is that “everything and everyone is for sale, or at least susceptible to manipulation or some form of control.” And finally, the Russian ruling elite believes that “individual human life does not matter anywhere, unless it is someone from their inner circle or equally as powerful as they are.”

The Times of Israel sat down with Zaslavskiy at a cafe in Washington, DC, to discuss the connections between Putin, Israel, organized crime, election meddling and the decline of democracy in the West.

The Times of Israel: There has been a lot of talk about Russian influence campaigns and Russian interference in elections. What aspect of this threat do you think people in the West are failing to grasp?

Ilya Zaslavskiy: They are failing to grasp two main things. First they think that the corruption, criminality and anti-democratic developments that happen in a place like Russia have very little to do with their own life or their own country. That’s the first delusion.

Today, everything is so much more integrated. When criminal groups supported by security services are allowed to do things in their own country, they immediately export their practices and values to the West, to safe havens where they can actually not only keep their money but can continue their activities.

There are many oligarchs of Jewish background from the post-Soviet space, from Russia, Kazakhstan and the Caucasus, who earned their money in a very dirty way in the 1990s and 2000s, and now they’ve moved to Israel

The second thing people fail to realize is that, unlike during the Cold War, there are open channels of business that these kleptocrats can exploit to export their norms and practices legally.

You see a lot of money from kleptocratic countries pouring into the West and paying for lawyers, lobbyists, PR people, even journalists, as well as former security people and security companies. In Soviet times this was not possible. Today, a Russian kleptocrat can continue his criminal activities in the West in broad daylight, without being prosecuted and hardly being covered by the press.

How might this be happening in Israel, and how might Israelis not be aware of it?

There are many oligarchs of Jewish background from the post-Soviet space, from Russia, Kazakhstan and the Caucasus, who earned their money in a very dirty way in the 1990s and 2000s, and now they’ve moved to Israel.

Some have Israeli citizenship and operate abroad and some operate in Israel. It’s not only that they have a luxurious lifestyle, throw fancy parties and buy amazing real estate. That’s another delusion in the West. Many Westerners believe that oligarchs bring their dirty money to their new country but merely as consumers.

In fact, they start to invest in assets — in strategic assets, in politics and in newspapers.

The vast majority of oligarchs can be hired on an ad-hoc basis by the Russian state or Kazakh state, and can be exploited for political purposes by this kleptocratic state.

I recently co-authored a report — “How to Select Russian Oligarchs for New Sanctions?” — that explains why and under what criteria the US government should add oligarchs like the Alfa Group oligarchs to sanctions.

There are very powerful figures with lots of money, lobbyists and PR support in Israel. [Prime Minister Benjamin] Netanyahu shows up at events with some of them.

Let’s say you have an oligarch who is close to Putin. What would they be doing in Israel? Why should Israelis care?

They can do multiple things. First, they can normalize Kremlin narratives about Israeli interests.

For example, the way they present Russia’s place in the Syrian conflict, in relations with enemies of Israel like Iran, or concerning the Soviet diaspora in Israel.

I’m sure they help promote Kremlin propaganda about the Second World War and Russia’s [ostensibly] almost exclusive role defeating the Nazis. And they peddle the Jewish veterans’ theme with the orange and black St. George ribbon. It’s a ribbon that commemorates the Soviet victory over Nazism that has come to be associated with Russian propaganda against Ukraine and against the West — how the West never really stood up to the Nazis, for example. These are not just historical narratives; they are very useful for today’s politics.

Above and photo at top: Prime Minister Benjamin Netanyahu (right) and Russian President Vladimir Putin (left) attend a wreath-laying ceremony at the Tomb of the Unknown Soldier in Moscow, on May 9, 2018. Both men are wearing the orange and black St. George ribbon (Amos Ben Gershom/GPO)

But the other thing oligarchs can do in Israel is to co-opt the elite, under the guise of cultural and charity events. They can throw fancy parties with caviar and beautiful women and invite politicians. They have held these receptions around Western capitals. I have followed some of these in London, as well as here in Washington.

Why would a Russian oligarch own a newspaper or TV station?

They may have financial interests and hope to make money but for many of them it is not done for commercial purposes. The reason is to support politicians through the media, and that allows you to get a foothold in the government. You do nice things for the government and then they do nice things for you in return. You establish a relationship and it’s a long-term thing.

It’s all very interconnected. The payback is not immediate but it’s a very solid investment.

Let’s say a Russian oligarch moves to Israel and starts investing in all kinds of businesses and giving money to charity. Why not just assume he’s retired?

No one from that world of state security or organized crime is off the hook because the Russian state has too much compromising material on them, as well as incentives. Also, if you don’t comply you can be eliminated. There is now a book on how Putin most likely ordered killings of dozens of people inside Russia and outside Russia who did not comply with his interests, including from his own security services or organized crime.

A file photo taken on September 14, 2004, shows Alexander Litvinenko (L), a former Russian intelligence agent, speaking at a press conference in London. (AFP PHOTO / MARTIN HAYHOW)

For example, he first used polonium not on Alexander Litvinenko but most likely on Roman Tsepov, who was part of the organized crime group in St. Petersburg in the 1990s that allegedly worked closely with Putin during his rise to power. It’s easier for anyone to comply. There are many oligarchs abroad that he uses on an ad-hoc basis. It’s switch on, switch off. It’s not too demanding or too crazy, and it’s actually acceptable to most of these people.

What’s the connection between the Russian state and organized crime?

In Soviet times there were three worlds that were distinct — with separate, even contradictory, goals. There was the Communist Party, the security services and organized crime. Organized crime was more or less antagonistic to the Soviet regime.

Organized crime and its networks have become part of the Kremlin’s political instruments abroad, including in Israel

Under Putin these three worlds collided and fused and learned from each other. Security services now oversee the businesses of organized criminal groups. Organized criminal groups carry out the political building and conduct operations for the Kremlin. The ideology of the Communist Party was thrown down the drain but the cynical and pragmatic practices, like co-opting the far right, co-opting the far left, co-opting Christianity or Judaism, remained.

You co-opt whoever is important to you in any given country. You can even contradict yourself in different countries but just divide and rule through all these channels — through ideology, through organized criminal groups, through corruption. Organized crime and its networks have become part of the Kremlin’s political instruments abroad, including in Israel.

If there were a Georgian or Russian oligarch who wanted to open hundreds of call centers throughout Israel and scam people abroad out of money, is that something that co-opting the elite would allow them to do?

Yes. But compared to corruption in Russia which involves billions for a single road or pipeline, binary options and forex are a relatively small-scale fraud. Russia as a state is also involved in hacking and dodgy cryptocurrencies; we now know that for a fact from Robert Mueller’s investigation. Russia as a state, especially its security services and associated oligarchs, are involved in all sorts of dodgy things, including in the digital realm.

Someone like Putin would not follow specific criminal activities like binary options, but he sits at the top of a pyramid and there might be levies that make their way from an Israel-based criminal enterprise all the way to the top.

Why would a Georgian or Russian criminal decide to put call centers in Israel of all places?

For a variety of reasons. Corrupt Russian money penetrates any vulnerable spot in the world. The criminality has not just penetrated Israel. It’s in Europe, in Asia, the Middle East and the US.

Why do there seem to be many Jewish oligarchs?

It’s a very useful topic to anti-Semitic circles and it’s not true. Maybe in the late 80s and 90s indeed there were a lot, perhaps too many, visible Jewish oligarchs because of the legacy of the Soviet era and tsarism. Jews had been marginalized and pushed into the black market. They traditionally had math skills, due to the way they were raised, and they helped each other, as does any minority network; ethnic minorities tend to help each other.

Under Putin, I think it’s a specific propaganda tool to expose Jewish oligarchs much more than the rest of the oligarchs. “Oligarch” is actually no longer a useful term in my view, because it suggests that they still have some power. They lost all their power to Putin. Their only currency today is loyalty, it’s not dollars.

Half of the major Jewish events that I see here in Washington, the fancy ones where you can co-opt elites, are co-sponsored by Russian oligarchs

Whatever dollars they have in their accounts can be taken away from them at a snap. Yes, they can store their money offshore but they can’t stop working for the Kremlin. Most of them still own too much in Russia and there are too many hooks and levers on them.

There is no distinction between public and private property in Russia. Everything is owned in one way or another by the Kremlin. So the money that they give as donations, very often they are asked to give the donation. And they have no choice but to give it.

Actually, the Russian state tries to present some of these oligarchs as if they are no longer with the regime, as if they are now in the West. It’s all very misleading. I could count actual Russian oligarchs who are completely removed from the Russian state with one hand.

What about Leonid Nevzlin?

Well, Nevzlin is one of the exceptions. He was ousted from Russia. Mikhail Khodorkovsky too.

I don’t like the term oligarch. I prefer the term handlers, operatives, maybe agents, rich agents. Many of them are actually front men for the money that they ostensibly have. It’s not actually considered fully their money. I’m sure they’re representing some of the Kremlin money, just under the guise of it being their money.

Just to return to your question about the Jewish oligarchs. Currently there are many rich and powerful security people around Putin. They are mostly Russian or a variety of nationalities, but they are secretive and very well protected. Some of the federal ministers as well. Most of the Russian Duma and government are millionaires. They’re just officials but they have the lifestyle of a mini-oligarch.

Should we feel sorry for the oligarchs? It sounds like they can’t escape their gilded cages.

Well some of them managed to escape and these are very exceptional, but obviously at a very high cost to themselves.

There are actually many whistleblowers and refugees from the Russian regime, some of them reformed, some of them not. London has a lot of people like that. Some of them managed to take out some money while others didn’t. They lost a lot, some involuntarily because they fell out of the system. Only few deserve any kind of empathy. Otherwise it’s a very complicated and dark world.

Why do oligarchs give so much money to Jewish and Israeli charities, especially religious ones?

It’s co-option and soft power, and they may be even be using these charities to give political donations.

For themselves, it’s reputation-laundering and legitimacy. It also allows them to advance narratives that are useful to the Kremlin — like about World War II.

If you look at the list of art galleries, museums, and all sorts of Jewish organizations, in New York, Europe and Israel that are associated with Putin’s oligarchs, you will be absolutely amazed

For instance, this whole debate about Ukraine. Russia tries to say the current government is a Nazi government, and how all of western Ukraine and their parties are anti-Semitic, how the West opened a second front in World War II at too late a stage and did not help Russia. The Kremlin can co-opt Jews to promote these narratives.

And then there are the May 9th celebrations [V-Day, commemorating the surrender of the Nazis in 1945] by Russia around the world, including in Israel on a large scale now.

Funding Jewish charities also gives them access to people. If you have a high-level event at the Metropolitan Museum or the Museum of Jewish History, you get access to politicians so you can co-opt them. If you look at the list of art galleries, museums, and all sorts of Jewish organizations, in New York, Europe and Israel that are associated with Putin’s oligarchs, you will be absolutely amazed and stunned. MOMA, the Metropolitan Museum, operas, Carnegie Hall, the Victoria and Albert Museum, the Tate Gallery. The list is endless.

Half of the major Jewish events that I see here in Washington, the fancy ones where you can co-opt elites, are co-sponsored by Russian oligarchs.

I’m sure that Russian oligarchs have managed to co-opt many politicians in Israel.

Look at [the rise in Russia of] Chabad. People in Chabad say, “We are just promoting the Jewish legacy. At least there is no anti-Semitism under Putin.” They find all sorts of excuses [to be supportive of Putin]. Before Putin, Chabad was a marginal group, at least in the former Soviet Union.

Minister of Defense Avigdor Liberman seen with Russian-Israeli World War II veterans, as they take part in the Veterans Day parade in honor of the Allies’ victory over Nazi Germany, at the Knesset. May 8, 2018. (Miriam Alster/Flash 90)

What is the Russian ruling class’s goal in Israel?

To create an environment — a political environment and economic environment — where it’s too difficult for Israel to resist some of the strategic interests of the Kremlin in the region. Not to oppose Russia’s interests.

But they’re also interested in subverting democracy. A strategic goal for the next few years is to subvert democracy in the West. In some ways they have already succeeded, and the appetite comes with food, as they say. So once they subvert democracy, the goal is to advance more corruption, more vested interests and then just turn the whole West into a corrupt world.

Why do they want to turn the West into a corrupt world?

Because then you can engage in what Russians love, which is realpolitik. Whoever is strong gets his own zone of influence and no one else can interfere. Russia would like to divide the world into zones of interest.

Look at what they did with influencing the American elections and possibly Brexit.

Russia’s President Vladimir Putin (L) and US President Donald Trump talk as they attend the Asia-Pacific Economic Cooperation (APEC) leaders’ summit in the central Vietnamese city of Danang on November 11, 2017. (AFP/Sputnik/Mikhail Klimentyev)

By the time of the 2016 elections in the United States, Russians already had all sorts of Putin understanders and supporters in the press, in the lobbying groups, in business circles, in chambers of commerce, among politicians, even in Congress. They have all these people who are associated with Russia through attending events at the Russian Embassy, going to conferences in Russia and Europe, sitting on boards of Russian companies or galleries associated with Russian money. It’s all done through open channels.

There are several think tanks in Washington which are completely subverted by Russians and that put forward narratives useful to the Kremlin about everything — from Ukraine, to Israel, to corruption. That acts as a force against an independent press, independent thinking, because you can pollute the whole policymaking and debating environment

They also influence think tanks and their debates and narratives about Russia. There are several think tanks in Washington, for example, which are completely subverted by Russians and that put forward narratives useful to the Kremlin about everything — from Ukraine, to Israel, to corruption — and that acts as a force against an independent press, independent thinking, because you can pollute the whole policymaking and debating environment.

Why does Putin want to destroy democracy? Because it competes with his patronage system?

Yes. If I had to judge, I think it’s just his enormous lust for power and he’s a control freak. He just can’t get enough. But maybe, some people suggest that his circle pressures him. I would imagine they pressure each other and it’s a constant game of power, so he has to stay afloat and show benefits.

You’ve said you think journalists are not writing enough about Putin and his oligarchs?

I see it as a huge problem that the Western press is just incapable of covering many of these topics. The press has been marginalized by the internet, so it’s a global trend. Newspapers have lower budgets, they struggle more for advertising, there is much more private and partisan ownership of media outlets. These are all global trends but they influence coverage on Russia also.

Even high-level, big outlets like The New York Times and Guardian face extremely aggressive, litigious teams of lawyers and lobbyists of these oligarchs who have infinite pockets and can afford long legal fights.

Many newspapers don’t have proper foreign country correspondents. If they do, they have to write quick articles, like one per week without delving into difficult topics. Then there is a vicious cycle where complicated cases about Russia are not covered in the West and so there is no interest about them. And since there is no interest there is no coverage.

The first stage is that you lose transparency, democracy and good governance. Israel is already losing that

Very often I found that I wasn’t able to put important topics out there just because it was too complicated for the journalist to write. Not even because of libel issues or because of time constraints. He or she would say, “My editor will not take it through because it’s too complicated. It delves too much into Russian detail.”

Most amazingly, most major media outlets do not have a full-time Russian translator and researcher who can fully devote his or her time to the most basic background research for the few investigative journalists that these outlets struggle to support.

What will happen to Israel if it does nothing about the corrupt kleptocratic influence you describe?

The first stage is that you lose transparency, democracy and good governance. Israel is already losing that. There is no longer separation of powers. There is prevalence of the executive. There is organized crime and no one takes action against it. The police do nothing. This is the first step.

Israel may give up many of its positions in Syria very soon. I can’t exclude that.

What definitely will happen if we continue on the current trajectory is that the entire West will turn into some kind of Hong Kong. where superficially it is democracy. It has some kind of elections, it looks capitalist and there is modern technology, but in reality a corrupt, non-democratic government actually runs it.

For the average person what does that mean? That you’re either a criminal or you’re poor?

Exactly, if you don’t become part of the corrupt network, you’re much worse off. You’ll be on the sidelines, as happens now in post-Soviet states. There will be growing income inequality, shady deals, no social mobility and all these problems that are associated with semi-corrupt authoritarian states.

There may still be some semblance of democracy. The press will do fewer and fewer investigations and more entertainment and brainwashing. It will be much more partisan — so the only differences of opinion you can get is from vested interests, not from independent and objective civil society.

What can be done?

It’s a very harsh, difficult choice. The first step is acknowledgement of what is going on, followed by investigations and revelations of all these things.

I am not even sure what can trigger such acknowledgement and exposure. Even the meddling in US elections has not triggered the United States enough, although at least something is happening.

After this acknowledgement happens, you need a very robust policy of containment. There is no other choice.

People walking near Red Square in Moscow, Russia. (Hadas Parush/Flash90)

Some money flows have to be stopped; some people have to be kicked out of your country, or even stripped of their Western citizenship. There must be much stricter anti-money laundering and due diligence of companies, and auditors should hire Russian or Georgian or Chinese translators to look into the background of people trying to buy assets in the West.

Security services have to have a major say in any strategic purchase related to security, defense or the national interest.

And then obviously there should be more funds for independent investigative reporters. I am friends with an organization called the Organized Crime and Corruption Reporting Project (OCCRP). They tell me that to train one proper investigative journalist and to keep him safe and to keep him protected from libel suits, you have to have a budget of about $300,000 a year, maybe $400,000.

If your readers care about Israel, about keeping it democratic, there should definitely be some civil society efforts

When societies start investing in investigative journalism like that, that’s when the job will be done. And it can’t be one investigative journalist. You have to have dozens.

If your readers care about Israel, about keeping it democratic, there should definitely be some civil society efforts, some donations, some Kickstarters. Ultimately people should understand that this will hit them back in terms of their own welfare and their access to democratic institutions, but ultimately even economically.

It could happen in very unexpected ways. Your child could end up in a war with Syria, or some conflict instigated by Russia somewhere in the world. In a way this is a repetition of the 1930s. No one thought that events in Nazi Germany would have any repercussions for the United States. But then the country ended up fighting the Germans when it was too late.

Could this covert Russian influence constitute a factor in a future Israeli war?

The West is like a small clean lake, or relatively clean lake, in the middle of a swamp. And the floodgates have been opened

What people in general in the West should understand is that the West and NATO are now becoming a minority force in the world; the power of the United States is declining. These large authoritarian states are taking over if not the world then at least Eurasia, countries like China and Malaysia that are not going to become democratic any time soon. The richer they get, the more authoritarian and the more aggressive and expansionist they become.

Democratic countries are becoming like an oasis in the desert. A better metaphor is that the West is like a small clean lake, or relatively clean lake, in the middle of a swamp. And the floodgates have been opened. It’s not like the small lake will clean up the swamp. It’s the other way around. So unless you close the doors and put some filters in place, you will be taken over as a swamp as well.

It won’t be easy. Consumption in the West will have to be scaled back from those money flows from Eurasia. Some industries will have to suffer, especially those that benefit from gas and oil contracts, as well as lobbyists, PR people, lawyers, all offshore accountants and real estate people. They will have to suffer; they will not make as much money.

But the society as a whole will benefit and be able to hold on to its values, like due diligence and good governance.

In terms of Israel specifically, if this does not happen, then I think the NATO alliance will be marginalized and might have to be involved in conflicts it doesn’t want. And then Israel will be much more on its own against its foes, and might not receive as much American help as it might hope to in such circumstances.

So all this has direct security implications for Israel as a society, and Israel as a state, unfortunately.

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COMMENTS

Corporate concentration threatens American democracy

(THIS ARTICLE IS COURTESY OF ‘THE WORLD POST’)

 

Corporate concentration threatens American democracy

By Nathan Gardels, WorldPost editor in chief

Corporate concentration in the United States is not only increasing inequality but also undermining competition and consumers’ standard of living. Politically, the commensurate lobbying influence of big tech, big finance and other large conglomerates has created what political scientist Francis Fukuyama calls a “vetocracy” — where vested concerns have amassed the clout to choke off legislative reforms that would diminish their spoils.

Why the opposite is happening in the European Union is an unfamiliar tale of how governance one step removed from electoral democracy has been able to resist the lobbying of organized special interests to make policy that benefits the average person.

Active antitrust policies in the second half of the 20th century fairly leveled the playing field of American commerce. “But starting around 2000, U.S. markets began to lose their competitive edge,” Germán Gutiérrez and Thomas Philippon write, based on a new study of theirs.

“Now, Internet access and monthly cellphone plans are much cheaper in Europe than in America, as are flights. Even in Mexico, mobile data plans are better priced than in the United States. … Meanwhile in the United States, deregulation and antitrust efforts have nearly ground to a halt. The United States has not completed a major reform to the goods and services market since 1996, and as a result, its industries have grown increasingly concentrated.”

What explains this stunning shift is deliberate policy choices. As the authors relate: “European countries created the single market, which took effect in 1993, and deregulated their domestic markets. Today, most European Union countries score better than the United States in enacting policies that make industries more competitive. Not surprisingly, antitrust enforcement remains active in Europe, with two recent cases against Google resulting in over $7.7 billion in fines. European markets are also less concentrated than U.S. markets.”

Gutiérrez and Philippon argue that “free markets are supposed to discipline private companies, but today, many private companies have grown so dominant that they can get away with bad service, high prices and deficient privacy safeguards. … If America wants to lead once more in this realm, it must remember its own history and relearn the lessons it successfully taught the rest of the world.”

Mario Monti — who was Italian prime minister from 2011 to 2013 as well as the E.U. competition commissioner from 1999 to 2004 and is famous for “shooting down mergers in flames” — agrees with Gutiérrez and Philippon. But he adds an important dimension they don’t discuss: how the much-maligned “technocratic” European Commission has been more able than American antitrust authorities to resist undue corporate influence over policy decisions.

While antitrust efforts in the United States are highly sensitive to election cycles and outcomes, Monti points out, the European Commission (which is indirectly elected by the European Parliament) operates at arm’s length from politics and can make decisions that are independent from lobbyist pressures on parliaments at both the national and European level. As he put it in a recent interview, “the more far away you are, the less you feel under pressure.”

The result is policy decisions that are more disinterested because the process is less politicized. This same technocratic distance in Brussels that has enabled a vigorous competition policy also applies to Europe’s landmark privacy regulation, the General Data Protection Regulation (GDPR), passed earlier this year.

Yet as Giovanni Buttarelli, the E.U.’s data protection supervisor charged with implementing the GDPR, laments, passing a law is only the beginning of reining in big tech abuses. “First came the scaremongering. Then came the strong-arming. After being contested in arguably the biggest lobbying exercise in the history of the European Union, the General Data Protection Regulation became fully applicable at the end of May,” he writes from Brussels. “Since its passage, there have been great efforts at compliance, which regulators recognize. At the same time, unfortunately, consumers have felt nudged or bullied by companies into agreeing to business as usual. This would appear to violate the spirit, if not the letter, of the new law.”

The challenge of implementing the law now, says Buttarelli, is continually challenging big tech. As he puts it, “The E.U. is seeking to prevent people from being cajoled into ‘consenting’ to unfair contracts and accepting surveillance in exchange for a service.”

Buttarelli is looking ahead to the next phase of reform. Under that reform, “Devices and programming would be geared by default to safeguard people’s privacy and freedom. Today’s overcentralized Internet would be de-concentrated, as advocated by Tim Berners-Lee, who first invented the Internet, with a fairer allocation of the digital dividend and with the control of information handed back to individuals from big tech and the state.”

While big tech lobbyists have so far frustrated privacy legislation at the national level in the United States, California has been able to pass curbs on abuses of personal data. Ironically, this was due not to technocratic insulation from politics but its opposite: the citizens’ ballot initiative. A San Francisco real estate magnate funded the gathering of qualifying signatures for a proposition that would impose the same kind of limits on use of personal data in California as contained in the GDPR, forcing big tech to come — reluctantly — to the table.

State legislators then negotiated and passed a measure this summer along GDPR lines that would be open to amendment as technology evolves. With legislation secured, the initiative was withdrawn from the public ballot. (If law is made by the citizens’ ballot initiative, it can only be amended by another vote of the public.) As state Sen. Bob Hertzberg (D), who crafted the compromise between privacy advocates and the tech companies, notes, the law in effect makes California’s attorney general the nation’s “chief privacy officer,” since most of the big tech companies affected are located in Silicon Valley.

Making a market that works for the average citizen requires government that acts in the public interest, not at the behest of the largest players in the economy who underwrite the electoral and legislative process. To the extent that elected legislatures are captured by organized special interests, the “vetocracy” can be circumvented either by indirectly elected technocratic authorities or by direct democracy through the citizens’ ballot initiative.

The experiences with antitrust and privacy regulation examined in The WorldPost this week suggest that a mixed system that combines disinterested technocrats, elected representatives and direct democracy — each as a check and balance on the other — would be the most intelligent form of governance.

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U.S.-Turkey Relations Will Never Be the Same

(THIS ARTICLE IS COURTESY OF BLOOMBERG NEWS)

 

U.S.-Turkey Relations Will Never Be the Same

Escalating tensions might simmer down, but we’re past the point of pretending these two governments’ values are compatible.

Hope you sold all your lira before this week.

Photographer: Chris McGrath/Getty Images

There are only two ways that the diplomatic rift between the U.S. and Turkey can end: a compromise that salvages the relationship as best possible, or a complete rupture with devastating consequences both for Turkey’s economy and America’s regional strategic interests. Either way, there is no going back to the way things were.

The arrest in Turkey of American pastor Andrew Brunson nearly two years ago has led to a diplomatic spat that threatens a full-blown economic meltdown in Turkey. Brunson, along with many foreign nationals that were detained in the wake of the failed 2016 coup attempt, has been accused of “supporting terrorism.” A deal for Brunson’s release seemed likely as Turkish officials traveled to Washington this week, but fell apart apparently over last-minute Turkish demands.

Meanwhile, tensions have ratcheted up. The Trump administration has imposed sanctions on Turkey’s interior and justice ministers. Erdogan threatened retaliation and got the support of most of the Turkish opposition. On Wednesday, Stars and Stripes reported that a group of pro-government lawyers in Turkey have filed charges against several U.S. officers at the Incirlik Air Base, accusing them too of ties to terrorist groups. They are demanding all flights leaving the base be temporarily suspended and a search warrant be executed.

The standoff is partly the accumulation of years of resentment, despite the pretenses of a faithful partnership. Turkey’s once-unassailable support among U.S. foreign policy leaders, and in Congress, has been weakened by years of authoritarian creep, a worsening human rights record and cooperation with Russia and Iran in Syria. Turkey’s plans for a $2 billion purchase of Russian-made S-400 surface-to-air missiles, which NATO has said are incompatible with allied systems and restrictions on American use of the Incirlik Air Base, haven’t gone down well.

The feeling is mutual. Erdogan has never quite recovered from his anger at the way his allies seemed to sit on the fence in the hours after an attempted coup was announced in July 2016.

The Turkish leader is also furious at American support for the Kurdish militia fighting Islamic State in northern Syria. Earlier this year, he threatened American troops with an “Ottoman slap” if the U.S. tried to block Turkey’s military incursion into northwest Syria.

One major source of contention has been the U.S. refusal to turn over the Pennsylvania-based cleric Fethullah Gulen, a one-time Erdogan ally and now an enemy, whom Erdogan alleges was behind the coup and other attempts to undermine him. Trump’s abandonment of the Iran nuclear deal is another sore point; nearly half of Turkey’s oil imports come from Iran, and the re-imposition of sanctions against Iran hurts Turkey’s economy.

The Brunson case made all of that impossible to ignore, as U.S. evangelicals took up the cause.

But “impossible to ignore” is not to say that the Trump administration has become a principled defender of human rights in Turkey. Far from it. Trump, whose name adorns luxury properties in Turkey, expressed only praise for Erdogan when they met in 2017. When Erdogan’s supporters and guards attacked protesters in Washington, the affair was handled quietly.

The administration has been silent on other arrests of U.S. and foreign nationals in Turkey. But it was ready to strike a deal for Brunson’s release. The U.S. had already asked Israel to release Ebru Ozkan, a Turkish national who was arrested there on suspicion of aiding Hamas (Israel deported herthe day after Trump called Israeli President Benjamin Netanyahu). The Trump administration was also reportedly ready to allow Hakan Atilla, a former top executive of state-owned Halkbank, convicted for violating Iran sanctions, to serve out the rest of his prison sentence in Turkey. The deal was scuppered, reportedly, when Turkey wanted relief on a multibillion-dollar fine against Halkbank and an assurance that any investigations be dropped.

The U.S. can afford to play a longer game. The June 24 election may have strengthened Erdogan’s power further, but he didn’t win by a Putin-sized margin. (Erdogan cleared just over 52 percent, and that’s if we all agree to ignore the voting irregularities that presumably bolstered his numbers.) Turkey is divided politically, and the longer Erdogan rules by coercion, the more vulnerable he may become, especially if Turkey’s economy continues to suffer. As the main barometer of confidence in the country, the lira’s decline speaks volumes.

Even so, a diplomatic solution is clearly preferable to continued escalation. Erdogan is sacrificing the Turkish economy in order to keep Brunson as a bargaining chit. A fractured relationship with the U.S. will also put a strain on Turkey’s EU relationships and will give investors, already spooked, even more pause.

American support for Turkey doesn’t crumble in a day. The relationship is baked into ties on multiple levels, both inside and outside government, and for good reason. As Asli Aydintasbas and Kemal Kirisci argue in an April 2017 Brookings paper, however bad it looks, Turkey is crucial:

Without Turkey, it is difficult to see how a rule-based U.S.-led world order could be sustained in this region, and how a successful policy on containing chaos in the Middle East could be envisioned. Similarly, there are arguably no Muslim-majority nations apart from Turkey that can serve as a bridge with the Western world or achieve the democratic standards, to which Turks have grown accustomed and, inadvertently or not, still expect.

And yet, it has definitely changed, thanks not so much to national interests, but to failings in leadership. The U.S. will have to settle for something less loyal, less an alliance and more a transactional relationship. But then that seems to define these times pretty aptly.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Therese Raphael at [email protected]

To contact the editor responsible for this story:
Philip Gray at [email protected]

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