The Economist - 2 November 2024

Год выпуска: November 2024

Автор: The Economist Newspaper and The Economist Group

Жанр: Экономика/Политика

Издательство: «The Economist Newspaper Ltd»

Формат: PDF (журнал на английском языке)

Качество: OCR

Количество страниц: 84

WHAT COULD POSSIBLY GO WRONG?

• A second Trump term comes with unacceptable risks: leader, page 9, and briefing, page 14.
• Fear and loathing of the other side is doing democracies increasing damage. In a seven-page essay we parse the partisan data, page 17.
• A sunny view of America’s democratic vitality: Lexington, page 29.
• America’s economy is thriving. And voters are at last starting to notice, page 63.

The machinations inside Iran

• The Islamic Republic is seeking a new national-security strategy, page 41.

Does China need more stimulus?

• The Communist Party may be hoarding fiscal firepower to offset a possible trade war, page 38.

Focusing on ADHD

• Stop treating it as a disorder. Adapt schools and workplaces instead: leader, page 12.
• Researchers are starting to question the nature of ADHD, page 70.

The Telegram: a new column on world affairs

• The cold war looks simple compared with today, says our geopolitics columnist, page 55.

The world this week Politics

• Rachel Reeves, Britain’s chancellor of the exchequer, presented an expansive tax-and-spend budget. Taxes will rise by £40bn ($52bn; the biggest revenue raiser was an increase in employers’ national-insurance contributions. Ms Reeves changed her fiscal rules to enable lots more borrowing for capital investment and unveiled more spending on education, housing and green energy. The biggest winner was health care, which enjoyed the largest real-terms increase in spending since 2010, outside the pandemic.
• Israeli warplanes targeted Iran’s air-defence systems and missile factories in retaliation for Iran’s missile attack against Israel on October ist. Israel confirmed it had struck Iran, the first time it has officially acknowledged a direct strike on its foe. Iran played down the damage. America said there would be “consequences” for Iran if it attacked Israel again. Oil prices fell sharply amid relief that Israel had not hit Iranian energy facilities.
• The Israeli parliament voted to ban UNRWA, the UN agency for Palestinians, from operating within Israel. Nine UNRWA staff were sacked in August for their alleged involvement in Hamas s terrorist attack on Israel in October last year. America’s State Department and a host of NGOs urged Israel to reconsider the ban, as UNRWA plays a critical role in delivering aid to Gaza.
• At least 93 people were killed in an Israeli strike on a building in north Gaza, according to the Hamas-run authorities. An Israeli operation in Lebanon’s Bekaa valley, a Hizbullah stronghold, killed 60 people, according to the local governor. Breakdowns of civilian and combatant casualties were not provided in either case.
• Hizbullah chose Naim Qassem as its new leader following Israel’s assassination of Hassan Nasrallah and elimination of other senior leaders in the Iranian-backed militia. Yoav Gallant, Israel’s defence minister, said Mr Qassem wouldn’t be leader for long.

A neglected conflict

• A UN report found that the Rapid Support Forces, one of the two main parties in Sudan’s civil war, was responsible for widespread sexual violence amounting to war crimes and crimes against humanity. The RSF recently stepped up its attacks around Khartoum, the capital, killing hundreds of people, mostly civilians. Since it began in April 2023, the war in Sudan has displaced more than 14m people, or about 30% of the population. Parts of the country are afflicted by famine.
• Botswana held an election. The Botswana Democratic Party, which has ruled since 1966, was expected to win. Mokgweetsi Masisi, the president, is likely to stay on for a second term. The opposition alliance, which is fractured but popular with young people struggling to find work, has alleged there was vote-rigging.
• Flooding caused by exceptionally heavy rains killed at least 95 people in Spain’s Valencia region in the country’s worst flood-related disaster in decades. A year’s worth of rain was recorded falling in one day.
• Official results in Georgia’s parliamentary election suggested the pro-Russian Georgian Dream party had been returned to power with 54% of the vote. The pro-Euro-pean opposition coalition refused to accept the result, as allegations of ballot-tampering emerged. The country’s electoral commission began a recount of votes in randomly selected polling stations. Georgia’s election follows allegations of Russian meddling in Moldova’s recent poll.
• NATO confirmed that North Korean troops have been deployed to Russia to to help President Vladimir Putin wage war on Ukraine. The Pentagon estimates that 10,000 North Koreans are in Russia, some of them located close to the Ukrainian border, and that they could start fighting against Ukrainian troops within a few weeks.
• North Korea test-fired its first intercontinental ballistic missile of the year. The missile flew for 87 minutes, the longest flight yet for the regime’s ICBM programme. Some analysts think the country may be getting technical help from Russia in in exchange for help with Mr Putin’s invasion of Ukraine.
• In a shock result, Japan’s Liberal Democratic Party lost its majority in a parliamentary election. It was a big blow to Ishiba Shigeru, the prime minister, who called the snap poll when he was elected as the LDP’s leader a month ago. The LDP and its partner, Komeito, took 215 seats in the lower house, short of the 233 needed for a majority and leaving it scrambling to find other parties to support the coalition. A record 73 women were elected to the 465-member chamber.
• Canada’s deputy foreign-affairs minister told a parliamentary committee that India’s minister of home affairs, Amit Shah, was behind a campaign of violence and intimidation targeting Sikh activists in Canada. No evidence was provided for the claim against Mr Shah, the closest ally of Narendra Modi, India’s prime minister. Relations between Canada and India have soured after the murder last year of a Sikh separatist in Vancouver.
• Eight of Mexico’s 11 supreme court justices handed in their resignations, to signal they will not stand in elections in June 2025. Under a controversial new judicial reform, judges at all levels in Mexico will be elected rather than appointed. The reform stipulates that their pensions would be at risk if they did not step down, and then lost the election. Three justices close to Morena, the ruling party, are staying on.
• The government of Bolivia denied that it had attempted to assassinate Evo Morales, the country’s former president. Mr Morales says his car was shot at as he travelled through the centre of the country. The interior minister said Mr Morales’s convoy had fired shots at the police and ran over an officer. Mr Morales and Luis Arce, the current president, are feuding over who will lead their party, the Movement for Socialism, into an election in 2025.
• The conservative president of Argentina. Javier Milei, sacked his minister for foreign affairs, Diana Mondino, after she voted at the UN to end America’s embargo against Cuba. Since Mr Milei took office last December Argentina had always voted in line with American policy at the UN.

It ain’t over ’til it’s over

• America’s presidential candidates made their closing arguments ahead of the election on November 5th. Kamala Harris labelled Donald Trump a fascist. Mr Trump called Ms Harris a “radical left Marxist”. The opinion polls remained neck and neck.

The world this week Business

• Alphabet’s latest earnings pleased investors. Revenue from Google Cloud rose by 35%, year on year, and operating profit in the division surged from $266m to $1.9bn, allaying worries about small returns from the huge amount of money that Alphabet is spending on artificial intelligence. Overall net profit increased by 34%, to $26.3bn. Microsoft also reported big increases in revenue and profit on the back of its cloud-computing business. AI services accounted for 12 percentage points of quarterly growth at its data centres.
• The tech-heavy NASDAQ Composite hit a new closing record, having rebounded from a slump earlier in the year.

Cut-throat competition

• With both companies trying to establish their dominance in the cloud, Microsoft accused Google of using an “astroturf” lobby group to “discredit” it “with competition authorities and policymakers and mislead the public” Astroturfing is the practice of promoting a message or organisation while disguising its real backers. Microsoft claimed Google used “shadowy campaigns” against it in the past, and was funding “various industry commentators and academics to attack” it. Google retorted that it belonged “to a number of different trade groups that advocate for issues important to us and our customers”
• Meta also said its investment in Ai was delivering “strong momentum”, as its earnings beat expectations, but added that such spending would rise significantly next year.
• Reddit reported its first-ever quarterly profit, sending its share price up by 40%. The social-media platform made its stockmarket debut in March. It had 97m daily active users in the third quarter, up by 47% compared with the same period last year.
• Volkswagen reiterated the importance of its turnaround strategy, as it reported a 64% drop in third-quarter net profit, year on year. Vehicle sales fell by 8% in the quarter. VW wants to close three factories in Germany, its home country, according to the carmaker’s staff representative, slash tens of thousands of jobs and reduce pay by 10%. Industrial action looms.
• The European Union’s new tariffs on imported Chinese-made electric vehicles came into force. The new duties, which come on top of an existing 10% levy, range from 7.8% for Tesla’s imports to 35.3% for SAlC’s cars. The EU says China’s carmakers benefit from state aid that undercuts European rivals. A furious China has retaliated by imposing an anti-dumping measure on European brandy and is considering other punitive policies.
• Quarterly revenue at BYD overtook that of Tesla for the first time. The Chinese maker of electric cars chalked up $28bn in sales for the third quarter, ahead of Tesla’s $25bn. BYD is facing an additional 17% tariff in the EU, a market that is driving its global growth ambitions. Elon Musk has pledged to increase Tesla’s sales by 20-30% next year, a goal that many investors doubt he will be able to achieve.

Holding pattern

• Boeing raised $16bn from selling equity, one of the biggest share sales ever, and another $5bn from other securities. The cash injection staves off the likelihood of a downgrade of its credit rating to junk status. The aerospace company is reportedly in the early stages of considering a sale of its space business, which includes the troubled Starliner project. Meanwhile, fresh talks took place with unions to try to end the six-week strike at Boeing’s west-coast factories.
• The Bank of Japan left its main interest rate on hold at 0.25%. Ueda Kazuo, the bank’s governor, gave little away about when the next rate rise might be. Some analysts think the political uncertainty caused by October’s surprising general-election result may mean the central bank delays any increase until next year.
• America’s economy expanded by 2.7% in the third quarter, year on year (or by 2.8% at an annualised rate). The euro area’s GDP grew by 0.9% in the third quarter, the best year-on-year performance since the first quarter of 2023. Spain’s economy was 3.4% bigger on that basis, while Germany’s shrank by 0.2%.
• UBS made a net profit of $1.4bn in the third quarter, well above market forecasts. Like others in the industry the Swiss bank benefited from surging revenues at its investment bank.
• Zhang Yiming, the founder of ByteDance, TikTok’s parent company, is now China’s richest man, according to an annual report compiled by Hurun, a private research group. Mr Zhang’s wealth is estimated to be $49bn. The number of Chinese billionaires plunged to 753 in 2023, down by a third from a peak in 2021. “China’s economy and stockmarkets had a difficult year,” said the report’s understated author.

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