Category Archives: Arsenal Pulse

Brief thoughts and mini-analyses on stories in the news.

Sudan Info Minister: Omar al-Bashir deserves Nobel Peace Prize

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I realize there’s a long history of pretty undeserving and warmongering people winning the the Nobel Peace Prize but I’m pretty sure we’d really be redefining the word “Peace” entirely if the prize were given to Sudanese dictator Omar al-Bashir, as has been hilariously/disturbingly proposed by his Minister of Information, according to Darfuri media outlet Radio Dabanga.

According to the Sudanese Minister of Information, President Omar Al Bashir is a man of peace who should have been awarded the Nobel Peace Prize for ending the war between Khartoum and the southern Sudanese rebels in 2005.
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“President Al Bashir is being threatened with an ICC [International Criminal Court] arrest warrant for alleged war crimes in Darfur,” Information Minister Ahmed Bilal told James Butty of VOA News in an interview published today, “instead of being praised and encouraged for his efforts.”

Bilal said that Khartoum cares little about the ICC. “Let me tell you one thing: Our president is a man of peace. He stopped the longest war in Africa. Instead of giving him Nobel [Peace] Prize, he’s being called before the ICC. Instead praising him or encouraging him and saying that he’s doing good things to his neighbors, you are raising this talk of ICC problems.

 
You can read the VOA News interview with Minister Bilal here.

omar-al-bashirIn addition to Bashir’s genocide in Darfur, he is a past sponsor of global Sunni Islamic terrorism (including al Qaeda during the 1990s before their relocation to Afghanistan) and was a main instigating force and perpetuator of the Sudanese Civil War in the south, which he eventually ended under immense international pressure and UN involvement. Not exactly a shining force for world peace.

President Bashir was indicted in 2009 by the International Criminal Court for his activities in Darfur and has refused to face prosecution, unlike the president of nearby Kenya (who is currently standing trial on less serious charges for post-election violence). He is gearing up to campaign for yet another term as president after 25 years of rule. Fortunately, I doubt even the Nobel Peace Prize Committee is planning to consider Bashir any time soon … or ever.

Fourteen years of exploding wealth at the tippy-top

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I pulled this eye-popping bit out of a recent article in The Globalist on the ultra-wealthy in the world of soccer team ownership:

Large fortunes today are really, really large. The top ten billionaires on the Forbes list have the combined net worth of over half a trillion dollars.

To get into the ranks of the world’s top 500 billionaires, you now need $3.3 billion. Back in 2000, the top ten were worth just $280 billion, half as much as today’s bunch, and there were only 322 billionaires in the entire world total. While the fortunes of the super-rich doubled, the average household income in the UK, for example, went up by just one third.

Plutocrats have become a new global ruling class. They live in an effectively borderless world, socialize with other rich people around the globe, keep their fortunes in low-tax havens and influence the political process in their own countries in such a manner that they pay little or no taxes.

Weirdly, tax cuts don’t solve poverty, finds UN in New Zealand

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Building off the theme in my most recent post, about anti-poverty programs in Bolivia and Brazil, let’s look at two industrialized economies. A UNICEF report compared the anti-child-poverty programs of the (center-right) New Zealand government with the anti-child-poverty programs of neighboring Australia (led by a center-left government until 13 months ago). Here’s what they found, according to TV NZ:

A United Nation’s report says New Zealand’s child poverty and inequality rates aren’t improving, despite what it describes as the Government’s ‘ambitious’ programme of tax cuts.
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It says several Australian policies, which have increased Government spending on families with one-off payments, have had a greater effect.
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The National Advocacy Manager for UNICEF NZ, Deborah Morris-Travers, says the numbers suggest the Government needs to review how it is tackling child poverty.

“The report points to Australia where cash payments were made available to low-income families, protecting the poorest children and stimulating consumption to promote recovery. This is contrasted with New Zealand’s policy of tax cuts, which have done nothing to improve the situation for child poverty.”

 

What a surprise!

Granted, while Australia is similar in many ways, it is also many times larger by population and economic capacity; so how does New Zealand’s effort stack up against other peer economies?

There has been a 0.4% drop in child poverty rates here [in New Zealand]. But in similar-sized countries like Norway and Finland, child poverty rates have reduced by 4.3% and 3.2%, respectively.

 
In other words, further evidence (like in Brazil and Bolivia) that simpler, more direct transfer programs — instead of the indirect, “trickle-down” tax cut theories George H.W. Bush once dubbed “voodoo economics” — seems to work better to combat extreme poverty, even in developed economies.

After all, the very poor tend to earn so little money that they are not paying taxes that can be cut. Without a “negative income tax” system, tax refund money will never reach them directly. Hence, direct and hassle-free benefits have more impact. The money in such programs goes directly to the problem spots and helps establish a clear safety net and economic floor for children. That allows them to grow up healthier and with better prospects, while permitting up their parents to make ends meet and start to climb the economic ladder out of dire poverty and debt traps.

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Social inclusion, anti-poverty policy are great for the economy!

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Most US eyes on Latin America right now are turned to Brazil, where President Dilma Rousseff was just re-elected, ushering in a fourth consecutive term for the Silva/Rouseff anti-extreme-poverty agenda launched in 2002 under her predecessor.

Meanwhile, however, Bolivia — under more avowedly socialist leadership — is also continuing to (more or less) balance its budget, increase its social spending, and grow its macroeconomy substantially. Martin Hutchinson explains why in an article in The Globalist:

Part of it is the effect of commodity prices described above [in the article] and of Morales’ savvy and determined renegotiation of mining and energy contracts. Obviously, if commodity and energy prices are low during the next five years, Bolivia will have considerable difficulties.
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What truly sets Morales apart is this: As Bolivia’s first indigenous President, Morales has made great efforts to include the indigenous community – currently about 40% of Bolivia’s population – in the formal economy. He has provided them with both welfare payments and job preferences in order to increase their participation in the economy.
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in situations where a large proportion of the population is so poor that it does not participate properly in the economy it is possible to achieve a “growth dividend” by bringing them into full participation.

As they transition into full economic activity, their output allows the national economy to grow significantly, producing extra output and extra tax revenues, while enriching the economy as a whole – and not just the elites.

 
Hutchinson also points to the Bolivian and Brazilian models that — contrary to US and UK trends for a century and a half — don’t make the very poor jump through hurdles to qualify for government assistance, which seems to get better and less corruptible results on poverty:

In uplifting the very poorest, direct cash transfers with only simple conditionality are highly effective. A program […] costs only a couple of percent of GDP – far less than massive infrastructure schemes.

Yet, it reaches the poorest in society effectively – and, unlike infrastructure projects it cannot be gamed by economic elites – via shady corruption deals that are often part and parcel of large-sized public investment projects.

Denmark’s fast food wages

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Despite no minimum wage law but because of very strong unions and bargaining arrangements, Danish workers make more than twice as much money per hour working for US chains there as most of our workers make working for them here. And that’s on top of their generous government programs and universal healthcare. Curiously, the companies still make a profit (a smaller one, but it’s still there) and retain employees better, and those fast food employees don’t need to be on public assistance like half of ours are.

You’ve got to have one or the other (if not both) — a good minimum wage law or a labor union capable of negotiating against an array of vast corporate entities — to stand a chance of achieving a situation like this. Yes it means the corporate profits are slightly reduced and the prices are slightly raised, but the workers aren’t forced to live in poverty with food stamps and little to no healthcare, and instead they can pay for housing and consumer goods and move themselves and the wider economy up in the world.

Either way, we end up paying the bill somehow, whether at the point of sale or in taxation. Shouldn’t the goal, even for conservatives, be for the market to provide workers with a living wage and the dignity that comes with that, so taxes and government spending aren’t even involved?

Links to our past coverage of comparisons between US and European labor market systems are below. Read more

South Africa making headway in Lesotho crisis talks

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South Africa’s government is continuing efforts to mediate between the competing political factions in the Lesotho crisis, and is now trying to resolve the military instability and leadership dispute by directly talking to the still dangerous and disaffected supporters of the unsuccessful power grab. Here’s the AFP report:

South Africa’s deputy president has held secret talks with a renegade Lesotho military commander, a defence official told AFP on Thursday [October 23], as an offer of partial amnesty is floated in the hope of ending a destabilising post-coup stand-off.

 
General Kamoli remained at a secret hideout with a small but heavily armed band of supporters after fleeing there following his attempted coup d’état at the end of August.

Any amnesty deal would relate to the crimes of the attempted coup itself, but might also include various incidentals:

Lesotho police are investigating him for two crimes linked to the 30 August assault: high treason and murder.
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Mohasoa said authorities would be willing to provide the suspected coup leader his full retirement package “though we aren’t obliged to for a dismissed official.”

But more sensitive is the amnesty – perhaps for high treason, but not for murder.

“We can discuss possible amnesty for politically motivated reasons,” he said. “But not for what’s considered purely criminal actions.”

Whether Kamoli will accept the offer – which may include prosecution and perhaps jail-time – “That’s the million-dollar question,” said Mohasoa.

 
The other big thing, besides amnesty and clearing up where the military’s rank and file has placed its loyalties, will be trying to persuade the country’s police force to go along with it. They supported the prime minister and his ruling party against the failed coup and are understandably angry about the consequences of that, which continued to play out a month afterward:

Kamoli aside, Ramaphosa will also have to try to re-build trust between the country’s two most important security services – the Lesotho Defence Force and Lesotho Mounted Police Service.

In just the latest in a series of clashes on 30 September, a night-time shoot-out between soldiers and police on the outskirts of the capital Maseru left two more officers shot and wounded.

A top Lesotho police official told AFP he saw no major obstacle to rebuilding ties with the military if the coup leader and his allies, who have stymied criminal probes into transgressions by troops, are removed.

 
The South African mediation has also been making progress on the political front to resolve the critical, underlying factors that spurred the coup attempt:

Ramaphosa, mediating on behalf of the Southern African Development Community, has already reached a deal that allowed the re-opening of parliament – which had been shuttered for four months. As part of the agreement elections have been moved up two years to February 2015.

 
The ongoing closure of parliament was the main complaint held up by General Kamoli as justification for his purported goal of “disarming” the police and “escorting” the prime minister to the King of Lesotho to force parliament to be called back into session. The real reason, of course, was the prime minister’s decision to fire him as head of the armed forces the night before.

Update for Clarity, 10/28/14: According to the AFP’s Michael J. Jordan, who wrote the story I quoted above, the partial deal described above was signed late last week with the various co-conspirators and targets all in a room together (which must have been quite uncomfortable!). Kamoli will leave the country for a while and leave the military, while his police counterpart will also step down. But the unresolved details outlined in the post above remain a problem. Jordan believes the crisis is not finished yet.

Map of Lesotho's location in southern Africa. (CIA World Factbook)

Map of Lesotho’s location in southern Africa. (CIA World Factbook)

Baghdad’s stalling of oil revenue talks is pushing Kurds out

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The New York Times published an article on the latest efforts by the Kurdish Regional Government to go their own way from central Iraqi control on oil production and sales, in light of continued failure to negotiate new terms for revenue sharing.

The current arrangement is an 83/17 revenue split, with the national government in Baghdad on the high side, which hardly seems reasonable. I think it’s somehow derived from 17% of the reserves being in Kurdistan, but even that doesn’t make much sense (especially when so much of the past couple years’ rise in Iraqi production and new development contracts have been on Kurdish land and via the regional government). And the article suggests that the resistance by Baghdad to changing the arrangement is fueling a rapidly accelerating cycle of mutual non-cooperation that will probably end in an independence attempt:

The more Kurdish officials developed their oil industry, the more Baghdad balked. The more the central government restricted the Kurds, the more they felt like they had no choice but to press forward.

“Their policy is actually backfiring,” said Howri Mansurbeg, a professor of petroleum geosciences at Soran University in Kurdistan, said of Iraqi officials. “They want to prevent a Kurdish state, and now the exact opposite is happening.”

 
Maybe there would be a case for such an unbalanced ratio if Baghdad provided tons of services and defense to the Kurdistan Region, but they’ve done jack for them … and then have demanded everything from them, after the national security forces literally threw their weapons on the ground and ran away.

At the point Maliki handed Kirkuk to the Kurdish Regional Government to take care of, and their forces held it successfully, I think they earned the right to a lot more revenue. (And — as the Times points out, matching my analysis at the time in June — at the point he handed them Kirkuk, he also handed them enough oilfields to become independent.)

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