“If you are living in the past or in the future, you will never find a meaning in the present.” - Fausto Cercignani
Globalization and technologies have made the world so connected that it seems the world is accelerating, leaving us at a loss for understanding. As a result, we are increasingly looking backward to a supposedly safe and simple past. We noted strange phenomenons like the resurgence of 1920’s fashion, the rise of ‘simple diets’, the return to the farms, or the idealized national past. Dictators appear as potential alternatives to dysfunctional democracies and in the former USSR, some look back at the era of communism with envy.
On the other side, techno-utopists are looking at the current world with contempt and are dreaming about some utopia brought about with the help of technologies they are creating. They want to transform everything, break down old codes and any institution that stands in the way of their radical experiment. And we’re helping them, feeding their algorithms, databases and wallets by simply using their services.
The disruption caused by this social and economic divide must eventually translate into increased confrontation inside societies. Part of it is already translated into the rise of ‘populist’ parties, who simply repeat back concerns from their fellow citizens regarding globalization, social policy or immigration. Obviously, these parties do not offer good answers to these concerns, but since they are the only one that actually expose actual concerns and offer solutions, they are currently gathering traction. In the meantime, mainstream parties continue to pledge their allegiance to failed ideologies and economic policies.
A lot of rebranding has been done in the case of Canada’s PM Justin Trudeau and France’s President Macron, but in both cases these politicians represent interests and ideas that are conflicting with the one from their citizens. In the meantime, a new left has grown from the walking corpses of left wing parties, such as Corbyn in the UK or Melanchon in France. We might be witnessing the birth of a new political era, a renewed fight about the role of the state, a potential game changer for many citizens.
You’re doing your weekend wrong – Doing nothing (passive activities such as watching TV or online shopping) bring short term pleasure but won’t make you feel better on the long run. That’s because you need some ‘active’ leisure, such as a hobby, socializing and/or helping others.
Echoes of Wall Street in Silicon Valley’s grip on money and power – Tech resembles Wall Street as it lives in its own reality, speaks in its own narrow technical terms, is wary of government regulation (i.e.: taking power away from them) and is thus unable to communicate or understand ‘ordinary people’ anger.
Uber’s Repudiation is the Moment for the U.S. to Finally Start Regulating the So-called Sharing Economy – As we wrote last week, Uber’s downfall is the time to review and assess what value the ‘sharing economy’ actually brings to society. These companies business model is to undercut existing established competition by saving on regulatory requirements and using people’s own assets. They’re not innovative, just exploiting a legal grey zone. It’s time to bring them under control.
The Palace Intrigue at the Heart of the Qatar Crisis – Tribal feuds in the world’s energy hub. Qatar is ruled by a father and his son, which are not liked by the other tribal autocracies of the Gulf (the hate is reciprocal), and who have been aggressively challenging the Saudis in the regional geopolitics (from Egypt to Syria).
There is no other way with Pakistan – The US is unable to pressure Pakistan to stop funding terrorist groups since it has little financial leverage, is competing with China for influence, and that such demand would go against Pakistan’s national interest. The US must thus walk a thin line between pressures and support if it wants to retain its leverage on the country.
Economics of the Populist Backlash – Globalization produces losers that turn to the political parties that are openly against the race to the bottom in trade tariffs, as well as financial investments (both short and long term). The trade barriers are already very low and lowering them further in new treaties will not improve welfare except that of the richest.
Jim Chanos: U.S. Economy is Worse Than You Think – Weak numbers on housing and auto, while the Trump reforms (various repeal) make households burden a growing share of spending (especially in healthcare). At the same time, the infrastructure plan (Public-Private Partnerships) is unlikely to fix the US’ infrastructure since private companies focus on fast returns, which are unlikely to come from projects that are usually undertaken by the governments (bridges, roads, waterways…).
China’s fake travel spending masks capital flight, warns Fed – Chinese requests for holidays abroad or withdrawal in foreign countries are automatically registered under ‘travel’ purposes, making China’s travel spending per capita highly inflated. Such massive outflows are more likely to be capital outflows, which leads us to 2 conclusions: the overstated numbers related to the growing Chinese tourism; and the overstated state of the Chinese economy. While most foreigners remain bullish on China, middle class Chinese people we met were not so optimist.
Picture of the week: Globe staff photos of the month, June 2007
About Carlito Riego
"Great perfection may appear imperfect, but its usefulness is inexhaustible. Great abundance may appear empty, but its usefulness cannot be exhausted. Great correctness may appear twisted, great skills appear crude, great eloquence appear awkward. Activity conquers cold; inactivity conquers heat. Clear serenity governs the world." - Lao Zi