FT: World Bank warns global economy on ‘razor’s edge’ of recession

“The risks that we warned of six months ago have materialised and our worst-case scenario is now our baseline scenario,” said Ayhan Kose, the World Bank economist responsible for the report. “The world’s economy is on a razor’s edge and could easily fall into recession if financial conditions tighten.”


RT: EU becomes world’s top LNG importer

Purchases of liquified natural gas (LNG) made by countries of the European Union in 2022 soared 58% versus the previous year, making the bloc the world’s number one importer of the fuel, FT reported Monday, citing data from Refinitiv.

Last year, the EU’s imports of LNG amounted to 101 million tons, having outpaced purchases made by China, Japan and South Korea.

Counterpunch: The Political Hubris of Long-Term Plans

Few sights are more absurd or unreal than political leaders announcing their long-term plans for radical changes benefitting millions or their intention to reform giant institutions in a year or two. Grandiose pledges to create a better world trip off the tongue and they pretend to have a degree of control over events that they must know they do not possess.

I always liked the caustic remark of French Prime Minister Georges Clemenceau when told in 1918 about President Woodrow Wilson’s Fourteen Points for ending the First World War and for establishing a lasting peace. “Why does he need 14 points?” asked Clemenceau derisively. “Even the Good God only had 10.”

I remembered Clemenceau’s jibe when watching Prime Minister Rishi Sunak proudly unveil his five promises to the British people this week. These are to halve inflation; to grow the economy; to reduce debt; to cut hospital waiting lists; and to stop migrants crossing the Channel.

As exasperated journalists swiftly pointed out, the first three promises cover developments already underway and there is no date by which the last two tasks are to be accomplished. To be fair, Sir Keir Starmer struck back by producing similar guff about devolving government powers from the centre and doing many other good things without spending any money.

Reuters: Britain’s groundbreaking satellite launch ends in failure

Britain’s attempt to become the first European nation to launch satellites into space ended in bitter disappointment early on Tuesday when Virgin Orbit said its rocket had suffered an anomaly that prevented it from reaching orbit.

FT: Amazon plans closure of three UK warehouses as group cuts costs

Amazon is closing three UK warehouses this year, a move that will affect 1200 staff, as the internet retailing giant cuts costs following a squeeze in consumer spending.

Reuters: Belgium to extend life of two nuclear reactors by 10 years

The Doel 4 and Tihange 3 reactors - the newest of Belgium’s seven reactors - were due to close for good in 2025, but will now restart in November 2026 after necessary work and will continue operating for 10 years.

RT: German property market plummets

The real estate sector in Germany dropped in the last three months of 2022 due to the surging costs of financing and to record inflation in Europe’s largest economy, a report published on Monday by BNP Paribas showed.

FT: German carmakers signal easing of supply chain woes

Sales at BMW and Mercedes-Benz jumped in the final months of 2022 as the premium German car brands signalled supply chain problems that have plagued the industry were easing.

Carmakers around the world have been struggling with a lack of parts since the pandemic, particularly semiconductors, leaving many with large fleets of unfinished vehicles that cannot be delivered to customers.

Both BMW and Mercedes said full-year car deliveries slid last year by 4.8 per cent and 1 per cent, respectively, because of supply chain bottlenecks as well as lockdowns in China and the war in Ukraine.

East Asia and Oceania

Reuters: Taiwan calls on Germany to help maintain ‘regional order’

Taiwan President Tsai Ing-wen called on Germany on Tuesday to help maintain “regional order” during a meeting with senior German lawmakers who are visiting the island on a trip that Beijing has condemned.

Reuters: China retaliates against South Korea’s COVID curbs

TeleSUR: China’s COVID-19 Situation is Not a Threat to Europe: WHO

On Tuesday, the World Health Organization (WHO) does not expect the increase in COVID-19 cases in China to significantly affect Europe. It called for the epidemiological measures to be non-discriminatory and based on science.

But what if the Chinese variants are more evil and authoritarian than the nicer, more democratic variants that Europeans are constantly infected with? What then?

WSWS: Japan’s health care system pushed to collapse by COVID-19 cases

Japan is currently experiencing one of its worst COVID-19 surges since the pandemic began three years ago. Total official cases have now exceeded more than 30 million while deaths reached 60,000 on Sunday. Both are underestimates of the real figures and the overall toll of the pandemic. None of this gives the government of Prime Minister Fumio Kishida pause as it presses ahead with the removal of remaining mitigation measures.

WHTC: India’s inflation likely remained steady at 5.90% in December

Reuters: Indonesia rattled by 7.6 magnitude quake, tsunami warning lifted

Indonesia was struck by a 7.6 magnitude earthquake on Tuesday off the Tanimbar islands, prompting panicked residents in the area to flee their homes, although a tsunami warning was lifted after three hours and initial reports indicated limited damage.

WSWS: Sri Lankan president demands more austerity

Sri Lankan President Ranil Wickremesinghe called on public sector employees to work longer hours in his new year address to presidential secretariat staff on January 2.

“Each person’s duties cannot be limited to eight hours a day and five days a week. Let’s all work with commitment. By the end of 2023, I hope to take this country forward with the support of all of you, and to restore normalcy,” he declared.

Wickremesinghe’s message further underscores his determination to impose the burden of the deepening economic crisis gripping Sri Lanka on the working class and the poor.

Central Asia and the Middle East

People’s Daily: Iranian speaker holds Trump legally accountable for killing top commander

MEE: Israeli spyware sold to Bangladesh despite export ban

MEMO: Lebanon says Israel violated territorial waters, airspace

MEMO: Saudi Arabia to increase investments, deposit in Pakistan

Saudi Arabia will boost its investments in Pakistan to reach $10 billion and raise its deposits in Pakistan’s Central Bank to $5 billion, official media reported on Tuesday, Anadolu News Agency reports.


MEMO: Egypt: Inflation up to 22% in December

Asia Times: S Africa lends China-Russia a helping naval hand

China, Russia and South Africa are scheduled to hold naval exercises, a military flex known as Ex Mosi that will carry geopolitical weight for the former two allies’ vision of an emerging new multipolar world opposed to US dominance and the latter’s aspirations for leadership on the African continent.

Last week, Naval News reported that China, Russia and South Africa have agreed to conduct trilateral naval exercises between February 17-24 off the coast of South Africa’s KwaZulu-Natal province in the Indian Ocean.

North America

Reuters: U.S. banks get ready for shrinking profits and recession

U.S. banking giants are forecast to report lower fourth quarter profits this week as lenders stockpile rainy-day funds to prepare for an economic slowdown that is battering investment banking.

Common Dreams: ‘The Sheer Greed Is Obscene’: Moderna Plans 4,000% Markup for Covid Vaccine

Reuters: Deere & Co. will allow farmers to repair their own equipment

RT: Biden declares emergency in US state

Biden announced the decision on Monday, noting that federal assistance had been approved to respond to “severe winter storms, flooding, and mudslides” in California and to “lessen or avert the threat of a catastrophe” in the worst-affected areas. Disaster relief efforts will be coordinated under the Federal Emergency Management Agency (FEMA) and the Department of Homeland Security (DHS).

South America

Reuters: Argentina and China formalize currency swap deal

Argentina and China have formalized the expansion of a currency swap deal, allowing the South American country to increase its depleted foreign currency reserves, the Argentine central bank said on Sunday.

Argentina’s government needs to rebuild reserves to cover trade costs and future debt repayments, and more reserves are a key objective of a major debt deal with the International Monetary Fund (IMF).

TeleSUR: Peru Bans Entry of Evo Morales and Other Bolivian Nationals

TeleSUR: Brazilian Organizations Mobilize in Defense of Democracy

Several social organizations in Brazil took to the streets on Monday to mobilize in defense of democracy and rejection of the attacks carried out the day before by pro-Bolsonaro groups.

The call was made by popular movements and unions from different areas, who shouted slogans such as “no amnesty for fascists” regarding the people who assaulted the headquarters of the Planalto Palace (seat of the Executive), the Congress and the Supreme Federal Court (STF) in Brasília (capital).

Common Dreams: 1,500 Bolsonaro Backers Detained After Far-Right Coup Attempt in Brazil

Brazilian Justice Minister Flávio Dino said Monday that “about 1,500” people have been arrested since supporters of Brazil’s far-right former President Jair Bolsonaro attacked government buildings in Brasília the previous day.

The Ukraine Proxy Conflict

RT: EU taxpayers’ money invested in cluster munitions industry

A heavily indebted pension fund serving the European Parliament has been found to have used taxpayer money to purchase shares in various arms, tobacco, mining and fossil fuel companies, EUobserver reported on Tuesday.

The news outlet claims to have obtained “a detailed breakdown” of the fund’s investments between 1994 and 2010. According to the documents, MEPs held tens of thousands of shares in several arms manufacturers known for producing cluster munitions, which have been banned by the EU since 2008.

RT: Poland to create new eastern infantry division – defense minister

The division’s main area of operations will be the Podlasie Province, bordering fellow NATO member Lithuania and also Belarus, which is a close ally of Russia.

According to the minister, the division will comprise four brigades, separated into four battalions. A division is a military formation, consisting of between 6,000 to 25,000 troops.


Retrospectives, History, Theory, and Technology

Counterpunch: Contrary to the NYT, the Problem in An Aging Society is Income Distribution

The New York Times had a major article reporting on how many people in South Korea, Hong Kong, and Japan are being forced to work well into their seventies because they lack sufficient income to retire. The piece presents this as a problem of aging societies, which will soon hit the United States and other rich countries with declining birth rates and limited immigration.

While the plight of the older workers discussed in the article is a real problem, the cause is not the aging of the population. The reason these people don’t have adequate income to retire is a political decision about the distribution of income.

If the issue was simply that too few people were working in these aging societies, we should expect to see slower per capita growth than in countries where aging is less of a problem. That is not the case. The figure below shows real per capita income in these three countries from 2014, along with projections to 2027, as well as France, which has maintained a relatively high birth rate.

As can be seen, both Korea and Hong Kong have been seeing more rapid per capita GDP growth than France and are projected to continue to do so, with Japan’s growth rate virtually identical over this period. Korea is projected to maintain a 2.4 percent growth rate, while Hong Kong is projected to have a 1.4 percent annual growth rate. By comparison, France is projected to have a 0.94 percent growth rate, only slightly higher than Japan’s 0.9 percent rate.

The conventional story of a country facing problems due to aging would be that it stops seeing per capita income growth, and could even see declines, as the ratio of workers to total population falls. Two of the three countries highlighted are sustaining considerably more rapid per capita growth than a country that is less affected by an aging population. In the third case, the growth is essentially identical.

This means that the reason older people are unable to retire in these countries is not the aging of the population, but the political decision to not provide adequate support for the elderly population. In short, the problem is political, not demographics.

The Left and the Right

Monthly Review: The right turns anti-LGBTQ hate up to 11

Inside the Imperial Core

Naked Capitalism: Washington Has Trouble Refilling the Strategic Petroleum Reserve After 220 Million Barrel Draw

Originally at Oil Price, with foreword from Yves:

Oil experts had warned that the 2022 Strategic Petroleum Reserve drawdown would be bullish for oil in 2023, since replenishing the stocks would boost oil demand. The Biden Administration acted as if that would not be an issue by setting a $70 a barrel target on its purchases. But the Administration has not made much progress since Mr. Market is not cooperating.

And mind you, the Administration is having trouble with its price targets even as the Chinese economy continues to flounder thanks to its botched ending of Covid restrictions. Most experts expect oil prices to increase once Chinese demand rebounds.

Botched ending, indeed. Once again, I must denounce Xi Jinping for not drawing up a treaty with the leader of the coronaviruses to stop infecting Chinese citizens once the lockdowns ended.

Responsible Statecraft: Hawks blow a lot of hot air over proposed budget cuts

Writing for the Washington Post on Monday, Jennifer Rubin charged that the potential Freedom Caucus proposal to freeze federal spending at 2022 levels, which, if implemented across the board, could wipe out $75 to $100 billion in increased Pentagon spending included in the recent budget bill, could have “serious national security ramifications.”

She then quoted American Enterprise Institute budget hawk Mackenzie Eaglen, who said such a proposal “makes only authoritarians, despots and dictators smile,” adding, “it completely ignores the troops and is entirely divorced from strategic thought or the many and varied threats the country faces.”

Across-the-board cuts are never the best way to reduce government spending. They mean cutting effective and wasteful programs in the same proportions instead of making smart choices about what works and what doesn’t. But the idea of cutting up to $100 billion or more from the Pentagon, one way or another, should be up for discussion.

And the idea that dictators worldwide are basing their decisions on whether the Pentagon budget is an enormous $750 billion or an obscenely enormous $850-plus billion is ludicrous. What counts is having a clear strategy and a wilingness to carry it out, not how many dollars one can spend (or, too often, waste).

AntiWar: When Federal Interest Payments Come To Exceed the Military Budget: Time To Stop Defending the Rest of the World

A new year dawns bright, with the US hurtling over the fiscal cliff. The lame duck Congress voted for a pork-packed $1.7 trillion budget bill. As the saying goes, it’s only money!

At a time of enormous domestic need, Republican Senate leader Mitch McConnell pushed an extra $45 billion for Ukraine, declaring that Washington’s “number one priority” was supporting that nation. Kentuckians might wonder if their Senator had moved to Odesa, Kharkiv, or Lviv over the holidays.

Alas, this appropriation was small change compared to the overall “defense” (in fact, mostly for offensive operations) budget. Congress hiked military outlays to record levels, topping off the already-bloated Biden spending program at $858 billion. American taxpayers remain stuck subsidizing prosperous, populous Europeans, superfluous Middle Eastern monarchs, and cheap-riding Asian defense dependents.

Unwilling to raise taxes as it also shovels ever-more cash into social programs old and new, Congress simply borrows additional money as if loans need not be repaid. The publicly held national debt hit 100 percent of GDP and is heading toward the record of 106 percent set in 1946, at the conclusion of the worst war in human history. Within a decade the US faces trillion-dollar deficits for as far as government analysts can budget. By mid-century the Congressional Budget Office expects the debt/GDP ratio to run around 185 percent. And that assumes policymakers don’t do anything stupid, like approve massive new spending programs without paying for them. Which, unfortunately, is as certain as the rising of the sun.

Endless borrowing isn’t cheap. Over the last decade interest payments as a share of GDP jumped about a quarter. And the era of (almost) free money is over as the Federal Reserve pushes up rates to wring inflation out of the economy. The budget agency’s estimates are daunting: “Combined with rising interest rates, large and sustained primary deficits cause net interest outlays measured as a percentage of GDP to more than quadruple over the period: They rise from 1.6 percent of GDP in 2022 to 7.2 percent in 2052.”

Climate Change

Climate Change News: Hurricanes and floods bring $120bn in insurance losses in 2022

Hurricane Ian in the United States and floods and Australia helped to make 2022 one of the insurance industry’s costliest years on record for natural disasters, Munich Re said on Tuesday, warning that climate change was making storms more intense and frequent.

Losses from natural catastrophes covered by insurance totalled around $120 billion last year, similar to 2021, though short of 2017’s record damages, Munich Re, the world’s largest reinsurer, said.

Naked Capitalism: Textbooks Are Falling Behind on Climate Change

Originally at The Hechinger Report.

Evidence is mounting fast of the devastating consequences of climate change on the planet, but college textbooks aren’t keeping up. A study released last month found that most college biology textbooks published in the 2010s contained less content on climate change than textbooks from the previous decade, and gave shrinking attention to possible solutions to the global crisis.

The study, conducted by researchers with North Carolina State University, was based on an analysis of 57 college introductory biology textbooks published between 1970 and 2019. The researchers found that coverage of climate change increased over the decades, to a median of 52 sentences in the 2000s.

But that figure dropped in the 2010s, to a median of 45 sentences. That’s less than three pages, according to Jennifer Landin, an associate professor of biological sciences at North Carolina State University and a co-author of the study.

The study identified other trends, too. Coverage of climate solutions dropped to just 3 percent of the total content on climate change, from a peak of about 15 percent in the 1990s. Information on climate change was increasingly left to the final pages of textbooks; in books from the 2010s, that material didn’t appear until readers had made it through nearly 98 percent of the text, compared with 85 percent in books from the 1990s.