// archives

United States

This tag is associated with 296 posts

Italy: “I Say No”

“Today saying No is the most beautiful and glorious form of politics….Whoever doesn’t understand that can go screw themselves.” It could have been Donald Trump before the US election two weeks ago, or Boris Johnson during the Brext campaign in Britain last June, but it was actually Beppe Grillo, founder and leader of Italy’s populist Five Star Movement.

Grillo unhesitatingly compares his movement to “Trumpismo” in the United States, and the Five Star Movement (M5S) is currently running neck-and-neck with Prime Minister Matteo Renzi’s Democratic Party in the opinion polls. Moreover, if Renzi loses the referendum on changing the Italian constitution that takes place this Sunday, there may be an election in Italy quite soon.

Matteo Renzi wanted to replace the elected Senate with a smaller appointed body and make other changes to streamline the process of passing laws in Italy. He got his proposal through both houses of parliament last April – but with such a slim majority that the results had to be confirmed by a referendum. At the time Renzi was confident that he would win it easily.

But that was before the Brexit vote in the United Kingdom and the irresistible rise of Donald Trump in the United States put wind in the sails of the Five Star Movement. Now the M5S’s “Io Dico No” (I Say No) campaign is drawing huge crowds as it tours Italian cities, and the final opinion polls before the vote on 4 December gave the “No” a five-point lead in the referendum.

As the polls began to turn against his constitutional reforms, Renzi warned that he would resign if the vote went against them. But all that did was to turn it into a referendum on his own popularity, which is turning out to be considerably less than he imagined. And if M5S comes to power, it is pledged to hold another referendum – this time on pulling Italy out of the euro “single currency”.

At the moment a large majority of Italians still want to keep the euro, but that could change. Italian cities don’t look as devastated as the US Rust Belt, but the same processes that brought Donald Trump to the presidency have been at work in Italy. Average family income is still less that it was before the 2008 crash, and unemployment among the young is close to 40 percent.

An estimated quarter of Italian industry has closed down in the past decade, and the country is staggering under the burden of a public debt that amounts to 132 percent of GDP. If uncertainty about the euro crashes Italy’s economy (the third-largest economy in the Eurozone), then all 19 countries that use the euro, some 340 million people, are in deep trouble.

And the Italian economy could go belly up, because Italian banks are now as vulnerable as American banks were before 2008. They are stuffed with “non-performing loans” that have not been written off, but stay on the banks’ books at around 45-50 percent of their original value. But they are really only worth about 20 percent of the original price.

If Italian banks marked these loans down to their true market value, it would wipe out their capital and they would all go bankrupt overnight. It is an accident waiting to happen – and a “No” victory in the referendum could be that accident, because it might open the Five Star Movement’s road to power.

In theory, it’s a long road from a “No” in Sunday’s constitutional referendum to an M5S government and a referendum on the euro. If Renzi resigns, and if no other combination of parties in parliament can form a government (probably not), there would be an election. But then M5S would have to win a majority, which is a long way from its current 30 percent support.

In practice, it might be quite a short road. A lot of Italians are so angry that they just want to punish “the elites”. If both M5S and the right-wing Lega Nord (which also wants to quit the euro) did well in the election, they might be able to form a coalition government, and then the fat would be in the fire.

Technically, only the single currency would be at risk, but in the current febrile atmosphere in Western politics, with support for populist parties surging everywhere, things can change very rapidly.

It is no longer inconceivable that the National Front, which wants to leave not just the euro but the European Union, could win the French presidential election in April. With Britain on its way out, a French government that wants to follow suit, and an Italian government that
at least wants to leave the euro, the entire 60-year-old project of European unity could crumble by the end of next year.

That’s a lot of ifs, and the likelihood of such a calamity is still very small. But we do live in interesting times.
______________________________
To shorten to 725 words, omit paragraphs 8 and 9. (“And the…power”)

Climate Change and Trump’s America

Even before Donald Trump hijacked the Republican Party, he was loudly declaring that the science of climate change, like Barack Obama, had not been born in the United States. It was, he insisted in 2012, a Chinese hoax “created by and for the Chinese in order to make U.S. manufacturing non-competitive.”

The implication is clear. Back in the late 1980s, when climate change was first publicly identified as a threat, those sneaky Chinese must have bought or blackmailed prominent Western leaders and scientists to perpetrate this hoax. People like NASA scientist James Hanse, who made a landmark speech to Congress on global warming in 1988, and British prime minister Margaret Thatcher, who spoke at the United Nations about it in 1989.

Some other people, especially in the coal, oil and automobile industries, have been denying the reality of climate change for decades, but only The Donald realised it was a Chinese plot. (He does have a big brain, as he frequently points out.) At the time, most grown-ups wrote him off as a harmless crank – but they certainly have to take him seriously now.

Trump has promised that within 100 days of taking office he will “cancel” the Paris Climate agreement of last December and “stop all payments of US tax dollars to UN global warming programmes.” He will also rescind the executive actions that President Obama has taken to limit US emissions of carbon dioxide, especially in the field of electricity. (In effect, this would have closed down almost all coal-fired power stations in the United States.)

Now in practice, Trump can’t cancel the Paris Agreement, which has been signed by 195 countries. He can pull the US out of the treaty (as George W Bush, another climate change denier, pulled the US out of the Kyoto Protocol on Climate Change in 2001), but he can’t stop other countries from carrying on with the agreed cuts in emissions – which they may well do, because they understand how dangerous the situation is.

He certainly can cancel all of President Obama’s executive orders and encourage Americans to burn all the fossil fuels they want. Indeed, he has already appointed Myron Ebell, a professional climate-change denier, to be the new head of the Environmental Protection Agency. Ebel’s mission is to gut it, and he will. But even Trump cannot save the American coal industry, because it has simply become cheaper to burn natural gas.

The net effect of a Trump presidency will certainly be to slow the rate at which American greenhouse gas emissions decline, but simple economics dictates that they will not actually rise, and might even fall a bit. Renewable energy is getting cheaper than fossil fuels in many areas, and even Trump would find it hard to increase the large hidden subsidies to oil and coal any further.

So how hard will the American defection hit the Paris agreement, whose target is to stop the average global temperature from reaching 2 degrees C higher than the pre-industrial level? Will it cause everybody else to walk away from it too, because the US is no longer doing its share? And even if they do carry on, what does that do to their hopes of staying below 2 degrees?

The United States is the second-largest emitter of greenhouse gases (after China), accounting for about 16 percent of global emissions. Its commitment under the Paris deal was to cut that amount by just over a quarter in the next ten years, so what is actually at stake here is around 4 percent of total global emissions in 2025 if the US just lets it rip. It could be considerably less in practice.

That is not a make-or-break amount, particularly given that all the pledges of cuts made in Paris last December did not get us down to the never-exceed plus-2-degree target. They got us a lot closer to it, but we would still be heading for around plus 2.7 degrees if everybody kept all their promises. Without American cooperation we are probably heading for plus 3, but in either case there was still a lot to do.

The unwritten assumption at Paris was that everybody would be back in a few years with bigger commitments to emission cuts, and so we would eventually stagger across the finish line just in time. It was always a dangerous assumption, but the other major players might simply refuse to go any further if the US is not doing its share. Especially China, which is responsible for 26 percent of global emissions.

On the other hand, China is terrified of the predicted local impacts of climate change, and has installed more solar and wind power than any other country. It already gets 20 percent of its power from renewables, and is aiming much higher. The Chinese will resent the Trump administration’s refusal to carry its share of the burden, but it will not cut off its nose to spite its face.

The world has grown wearily familiar with this aspect of American exceptionalism, and the effort to avoid a climate disaster will stumble on elsewhere even while Trump reigns in Washington.
_________________________________________
To shorten to 725 words, omit paragraphs 2 and 3. (“The implication…now”)

Half the Jobs Are Going

“The notion that Uber in London is a mosaic of 30,000 small businesses linked by a common ‘platform’ is, to our minds, faintly ridiculous,” said one of the judges on the employment tribunal. So the tribunal ruled that Uber’s 30,000 drivers in London were actually employees, and therefore entitled to be paid the minimum wage, to be given sick pay, even to have paid holidays.

Uber promptly appealed the ruling, because it would wreck its business model in the United Kingdom and, if the example spreads, worldwide. But it was only a temporary victory for workers’ rights, because just as the real jobs have been replaced by fake “freelance” jobs like Uber that strip people of their old legal protections, so the “freelance” driving gigs will soon be replaced by – no jobs at all.

The first self-driving cars are already on the roads. Automation, in the form of artificial intelligence, will probably abolish almost all the driving jobs in the next twenty years. In Britain alone, that means 400,000 jobs driving big trucks and almost 300,000 licensed taxi drivers. (The jobs driving delivery vans will last a little longer.)

Three-quarters of a million jobs gone, say, and nothing plausible coming down the road to replace them. Scale it up to the size of the United States, and that’s around 4 million more American jobs gone, not to foreign competition and “outsourcing” but just to technological change. It’s harder to replace drivers than bank tellers – “every ATM is the ghost of three bank tellers” – but it just takes a little longer to develop the right software.

There is a message here for all the angry people who voted for Brexit in Britain, who will vote for Donald Trump next week in the United States, who will vote for Marine Le Pen and the National Front in France next April. They are angry because the secure jobs and decent living standards they enjoyed in the latter half of the 20th century are gone. Something must be done about it, but the jobs are not coming back.

The newly insecure millions blame “globalisation” and the export of manufacturing jobs to lower-wage economies overseas for their plight, and in the early days that was indeed what killed most of the jobs. This is why they cheer for Donald Trump when he promises 40 percent tariffs on imported goods and the end of free trade deals like the North American Free Trade Agreement. They hope that he’ll bring the jobs home.

If he wins, he will destroy the Mexican economy, cause immense collateral damage to the Canadian economy, and trigger a full-scale trade war with China, but there is still no hope that those lost jobs will ever come home again. There might be more manufacturing in the United States, but automation would still ensure that most of the old jobs were eliminated. As they will one day be eliminated in their new homes overseas too.

This is a global economic transformation comparable to the industrial revolution, when entire populations went from overwhelmingly rural to overwhelmingly urban in only two generations. This time the transformation is from a full-employment economy to an economy of abundance that only requires a fraction of the population to work.

A 2013 study by Oxford University economists Carl Frey and Michael Osborne concluded that 47 percent of American jobs are likely to be destroyed by automation in the next 20 years. That’s change so big and so fast that people can’t believe it’s happening, and so they prefer to focus on something like out-sourcing that might be fixed by politics.

The industrial revolution was an angry, turbulent time, with urban uprisings and class warfare. We’ll be lucky if the damage this time is limited to demagogues like Donald Trump, who pander to the fear and anger of the newly displaced – and not just the displaced of the old working class, but the growing numbers of middle-class people who are also being displaced by machines.

They are not “right-wing” in the traditional sense, although many have become more socially conservative and some openly racist as their panic rises. “Populist” is a much better word: they hate the changes and the “elites” who seem untouched by them, and they want their old jobs and their self-respect back. But the old jobs are not coming back, and even populist politics cannot resurrect them.

Besides, most of them actually hated their jobs, from which they were only free for two weeks (the US and Japan) or at most five weeks (Europe) a year. The real task will be to find ways of providing a majority of our fellow-citizens with money and self-respect without those jobs. Some form of Guaranteed Minimum Income is probably the answer, but we have barely got round to asking the right question yet.

This is not a disaster; it’s a process. Last time it took over a century of mass misery and occasional mass bloodshed to get through it, but at the end most people were living much longer, healthier, more interesting lives than their peasant ancestors. We should try to do it a lot better and quicker this time.
________________________________
To shorten to 725 words, omit paragraphs 6 and 7. (“The newly…too”)

Sometimes Trump Is Right

Even a stopped clock is right twice a day. Donald J. Trump’s record is not that good, but he does get it right once in a while. He got it right on Tuesday, when he said that Hillary Clinton would be dangerously agressive in Syria if she wins the presidency.

Trump went too far, of course. He always does. He claimed that Clinton would trigger World War Three with her Syrian policy, which is utter nonsense. Given the current international balance of power, it is almost impossible to get a Russian-American war going. The Russians simply aren’t that stupid.

Even a new Cold War is hard to imagine. The Russians know that they would lose it in only a few years, so they would refuse to play their allotted role in any such scenario. But US-Russian diplomatic relations would get distinctly frosty for a while – and the United States, in the meantime, would be up to its neck in the Syrian civil war and betting on the wrong horse.

What Trump actually said, in an interview conducted in his Florida golf resort between bites of fried egg and sausages, was that the United States should focus on defeating ISIS. “We should not be focusing on Syria. You’re going to end up in World War Three over Syria if we listen to Hillary Clinton.”

The Clinton policy in question is her promise (repeated in the third debate) to declare a no-fly zone and “safe zones” on the ground in Syria to protect non-combatants. Those zones, of course, would deny the Syrian government the chance to recover the territory it has lost to the rebels, and deprive the Russian air force of the ability to help it in that task.

But what if the Syrians and the Russians don’t accept that the United States has the right to set up no-fly zones on Syrian territory just because it feels like it? What if they send their planes into those zones and dare the US air force to shoot them down? Then the US has to choose between backing down and being publicly humiliated – or shooting down Russian aircraft and (according to Trump) starting World War Three.

“You’re not fighting Syria any more, you’re fighting Syria, Russia and Iran, all right?” Trump explained. If Hillary Clinton set up her no-fly zones and “safe zones”, she would be asking for a war with Russia.

She would indeed be asking for it – but she knows that she probably would not get it. The Russians might shoot down a few American planes in response, and the United Nations would plead with both sides to show restraint. By then both sides would be sufficiently frightened that they would be all too happy to back away from their confrontation.

The Russians would be especially happy to do so, because they know perfectly well that they could not win a war with the United States. Even leaving aside the question of nuclear weapons (which make such a war unthinkable), Russia is simply not a credible rival to the United States any more: it has half the population of the former Soviet Union, and an economy one-tenth the size of the United States.

So Clinton would not really be courting World War Three if she did what she has promised. She would, however, be doing something very reckless and stupid. After Afghanistan, Iraq and Libya, the United States really does not need to get more deeply entangled in another unwinnable war in the Middle East.

What Trump is advocating is actually the policy that Obama has been following over the whole five years of the Syrian civil war: concentrate on eliminating ISIS, and do not get involved in the rebel military campaign to overthrow Bashar al-Assad’s regime however much you may dislike it. No more moral crusades.

Whereas Clinton, by declaring no-fly zones, would effectively be creating safe areas for the rebels to operate out of. However, the great majority of the active anti-regime fighters belong to ISIS, or to the equally extreme group that used to be called the Nusra Front and is now changing its name every week or so in an attempt to conceal its true origins as a breakaway part of Islamic State and an affiliate of al-Qaeda.

Most of the smaller rebel groups that Washington calls “moderates” are actually less extreme Islamists who are either voluntarily allied with the Nusra Front, or in thrall to it. But the fantasy still lives in Washington that it can bring together enough genuine “moderates” to create a “third force” that defeats both the Assad regime and the extremists of ISIS and the Nusra Front.

This has been the official position of the “Washington consensus” on foreign policy for five years now, and Hillary Clinton is a paid-up member of that delusionary group. If she carries through on her promises, she probably will trigger a crisis with the Russians, and she will certainly involve the United States much more deeply in the Syrian civil war.

It’s almost enough to make you vote for Trump. But not quite.
____________________________________
To shorten to 725 words, omit paragraphs 2 and 3. (“Trump…horse”)