The Economist - 4 January 2025

Год выпуска: January 2025

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: 132

THE FIGHT OVER AMERICA’S ECONOMY

• For the first time in American politics, tech is joining the federal government. Prepare for a clash of cultures: leader, page 7.
• Conservative mainstreamers, America firsters and tech tycoons — Donald Trump has established an economic team of rare breadth. Who will come out on top? Page 51.
• What investors expect, page 54.
• American businesses thrive by tapping the world’s brains and brawn. For how much longer? Schumpeter, page 50.

Xi Jinping’s daunting 2025

• A struggling economy, rising social tensions and the return of Donald Trump will test China’s president, page 27.
• Firms are leaving China, annoying pretty much everyone, page 55.

Get tough with Russian sabotage

• Finland’s seizure of a tanker shows how to fight skulduggery: leader, page 8, and analysis, page 34.

Plastic surgery a go-go

• Young customers in developing countries propel a boom in nipping and tucking: briefing, page 12.

Oldies behaving badly

• The new problem generation are those rascals over the age of 55, page 42.

The world this week

Police shot dead a man who rammed a pickup truck into crowds of New Year’s revellers on Bourbon Street in New Orleans, killing at least 15 people. The perpetrator was an American and former army worker who supported Islamic State. The police think he may have had accomplices. Potential explosive devices were found near the scene. The authorities are investigating any possible connection to the explosion of a Tesla Cybertruck outside the Trump hotel in Las Vegas, in which the vehicle’s driver was killed.

Tributes were paid to Jimmy Carter, who died at the age of 100. Mr Carter’s term as America’s president from 1977 to 1981 was best known for an energy crisis, a botched attempt to rescue hostages from Iran and a historic peace deal between Egypt and Israel. After his defeat to Ronald Reagan in 1980, Mr Carter worked tirelessly on human rights, earning him the Nobel peace prize in 2002. He was also a champion for Habitat for Humanity, which deploys volunteers to build or improve homes.

The Iranian-backed Houthis continued to launch missiles at the heart of Israel, despite America and Israel bombarding Houthi bases and infrastructure in Yemen. One Houthi missile recently hit Tel Aviv, injuring a dozen people. Meanwhile, American and French war planes struck Islamic State targets in Syria.

MPS in South Korea voted to impeach Han Duck-soo, who had been acting as interim president since the impeachment of Yoon Suk Yeol in December. Mr Han had refused to fill three vacancies on the Constitutional Court, which will hold Mr Yoon’s impeachment trial. The opposition accused him of trying to delay the case. Meanwhile, a court issued an arrest warrant for Mr Yoon, who has ignored requests to be interviewed by anti-corruption officials.

A possible bird strike was thought to have caused the crash of a Jeju Air flight at South Korea’s Muan airport, killing 179 people. It was the world’s worst aviation disaster since 2018.

An Azerbaijan Airlines flight crashed in Kazakhstan, killing 38 people. The plane had been trying to land in the Russian republic of Chechnya, where it is thought to have been hit by Russian anti-aircraft fire aimed at repelling a Ukrainian drone attack. Vladimir Putin apologised and admitted that Russian defences were active in the area, without confirming they had hit the aircraft.

Finnish authorities seized a tanker carrying Russian oil that is suspected of sabotaging underwater cables. In previous such incidents in international waters, vessels were let go; the Finns directed the tanker to Finnish waters and boarded it. Authorities found drag marks for dozens of kilometres on the seafloor, suggesting the ship had trawled its anchor.

Appearing before a committee hearing in Germany’s Bundestag, the country’s interior minister said it was too early to say what motivated the recent attack on a Christmas market in Magdeburg, though she said the suspect showed “signs of a pathological psyche”. A Saudi refugee is in custody after ramming a car into the market, killing five people. The committee grilled security and intelligence officials about warnings from Saudi Arabia that the man was dangerous.

The inauguration of Georgia’s new pro-Russian president, Mikheil Kavelashvili, was marked by protesters brandishing red cards (Mr Kavelashvili used to play football for Manchester City). He was selected for the position by the ruling Georgian Dream party, which forced the pro-European Salome Zourabichvili out of the job. Ms Zourabichvili contends that she is still Georgia’s “only legitimate president”.

Shortly before Christmas Joe Biden commuted the death sentences of 37 convicts on federal death row to life in prison, pre-empting Donald Trump, who has said he will end a moratorium on federal executions. Mr Trump’s team said that commuting the sentences was “abhorrent”. Mr Biden’s order does not include the three prisoners convicted in separate cases of attacking a synagogue, a black church and the Boston marathon.

Mr Trump asked the Supreme Court to postpone an impending ban on TikTok in America so that his new administration can “pursue a political resolution” of the issues at hand. The ban is due to be enforced on January 19th, the day before Mr Trump’s inauguration.

Turkey’s central bank cut interest rates for the first time in nearly two years, lowering its main rate from 50% to 47.5%. The government recently increased the minimum wage by 30%, which it described as a mark of fiscal discipline. With annual inflation still running at more than 40%, unions were demanding a 70% increase.

Stockmarkets fell in December, but despite that the S&P 500 had another good year, rising by 23% in 2024. The tech-heavy NASDAQ was up by 30%. European markets did less well. The German DAX gained 19%, the EURO STOXX 50 over 8% and the FTSE 100 nearly 6%. The CAC 40, where French banks and luxury-goods companies are listed, fell by 2%.

Letters

Excluding Taiwan

Your piece on “Which economy did best in 2024?” (December 14th) omitted Taiwan, presumably because it is excluded from most international statistics. According to the IMF, Taiwan grew almost a percentage point faster than Spain, which topped your list of the best economies. Taiwan’s stockmarket grew twice as fast as Spain’s index. Its inflation was slower, nearly spot-on its 2% target. The unemployment rate has held steady below 3.5%.
This omission from global statistics continues a long pattern. Yet Taiwan has ascended in less than a century from poverty to an economy marked by high incomes and from martial law to being among the freest in the world, according to the Bertelsmann Foundation. Perhaps it is time for believers in liberalism to ditch the conspiracy of silence orchestrated by a communist dictatorship against the developed country with the smallest and most efficient state in the world.
E. GLEN WEYL
Arlington, Massachusetts

Properly informed citizens

Bagehot (December 7th) was right to decry the lack of good data to support effective decision-making. Without good information any policy is likely to be at best an inspired guess, at worst a chimeric ectoplasm of the policymaker’s mind. But maybe policymakers would actually prefer their data to be less than perfect, so that they can make facts on the ground, rather than being driven by present-day reality.
You can argue with the specifics, but the distortions of arguments on both sides in the Brexit campaign, debates over the efficacy, or otherwise, of vaccines or lockdowns during covid-19, and government unwillingness to collect statistics on immigration all point to a similar conclusion. A political predilection towards “my truth” rather than “the truth”.
Britain has an Office for National Statistics and an Office for Budget Responsibility. Both have a remit to produce objective assessments. If we are blind, as Bagehot argues, then we need these offices to be strengthened and their work to be expanded and better communicated to us all as active citizens. If politicians behave little better than solipsistic hobby-horse riders, then good data is as essential to the proper functioning of a democracy as the rule of law.
SIMON DIGGINS
Rickmansworth, Hertfordshire

One doesn’t get the impression from Bagehot that “discovering an extra Slough” in official data is a happy discovery. This is only the latest slighting of the town. From the crematorium in “Brave New World” to an invitation for “friendly bombs” to fall on it and the post-industrial grey of “The Office”, Slough’s boosters must have quite the job going up against Aldous Huxley, John Betjeman and David Brent. Despite this it has done well to attract companies like DHL, Telefonica and Lego and provide the enterprise the government so badly needs to pay for its promises.
ALEXANDER MCPHERSON
Toronto

What is a processed food?

Everyone knows that greens are good for your health and red meat is not. But everyone would laugh if I were to propose that red foods are dangerous and green ones healthy. I could prove my thesis making use of a few additional rules, such as postulating that some shades of red, tomatoes and apples for instance, should not be counted as red.
The Nova classification system, which sorts foods into four categories depending on the degree of processing they undergo, uses similar logic (“Still processing”, November 30th). There is no scientific justification for the assumption that the number of processing steps is of any relevance for the health properties of foods. Making “ultra-processed” popcorn or chips is exceedingly
simple. Making “minimally processed” natural yogurt requires some 20 processes.
Heating is the process that affects foods the most, but heating is afforded no attention in Nova. It does not neatly fit into the processed or unprocessed scheme. In some cases it is essential for public health, in others it may induce carcinogens. And in a blatant example of the arbitrariness of the Nova classification, putting a loaf of bread into a bag moves it from the minimally processed to the ultra-processed category.
The flawed, but intuitively easy to grasp, label of ultra-processed food is a handy justification for blaming food-related health problems on profit-hungry food companies. And it enables politicians to divert funding from serious research to meaningless eyecatching interventions.
PETR DEJMEK
Emeritus professor of food engineering Lund University Lund, Sweden

The real Iranian regime

The By Invitation (December 23rd) from M. Javad Zarif, Iran’s vice-president, was bothersome, in that he did not admit to any wrongdoing by Iran to destabilise the region. Mr Zarif talked about the “sublime values” of non-intervention-ism, sovereignty and territorial integrity. Iran has violated these principles in Lebanon with Hizbullah, Yemen with the Houthis and Iraq with various Iranian-aligned militias. All these groups are funded by Iran with the goal of harming Israel.
Mr Zarif also talked of promoting a “safe and stable country where minorities and women can thrive” in Syria. In Iran the presidential campaign in 2024 did pledge to improve women’s rights, but the country continues to take backward steps in this regard. Publicly admitting to some harmful decisions would be a good first step for the regime. But no matter what Mr Zarif believes, Iran will continue to destabilise the region as long as people like Ali Khamenei are in power.
BEN JONES
North Las Vegas, Nevada

Mr Zarif offered a compelling vision of regional collaboration under a new “dialogue association”. His column spoke of non-aggression pacts, economic integration, infrastructure projects and energy security. One might ask, why do we need security guarantees in the Strait of Hormuz? Only one government has ever talked of blockading it.
YASIN KAY
London

Scotland the brave

The picture of the Clan Fraser headstone at Culloden Moor in your article about heritage tourism in Scotland made me smile (“A clamour for clans”, December 14th). Although much of the Scottish diaspora who visit Scotland may be well-informed about Scottish history, there are many who are not. I frequently walk or run across Culloden Moor, and I have been stopped on numerous occasions and asked for directions to Jamie Fraser’s grave. I used to point out that Jamie Fraser is a fictitious character in “Outlander”, which involves time travel, and that consequently there is no grave. Tired of continually being politely informed that I was mistaken, I now simply tell people that it’s the one over there with all the flowers on it, and hope that they enjoy their time in Scotland.
DAVID CADDICK
Inverness

Stockmarket prediction

Although I agree with Buttonwood that the valuation gap between American and nonAmerican equities will correct itself (November 23rd) I am reminded of this apocryphal quote, often attributed to John Maynard Keynes: “The market can stay irrational longer than you can stay solvent.”
SUNNY MAHAJAN
Jackson, Tennessee

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