10 April 2018

Do higher interest rates lead to lower growth?

Economists rarely agree on anything. Ask 10 economists to explain why the Indian economy is functioning the way it is, and you will hear varied explanations ranging from tight monetary conditions and banking crisis to ineffective fiscal policy and global economic conditions. Economics has a long list of “major” schools of thought: classical, neoclassical, Keynesian, Neo-Keynesian, monetarist, new classical, Marxist, Austrian, behavioural and many others. Many of these schools disagree with each other, even on basic assumptions like “human decision making is rational” or “utility can be measured”.

Peace In The Himalayas? A tale of war, colonisation, and rather dubious legality

Anirudh Kanisetti

Far from being eternally peaceful pilgrimage sites, the Himalayas have seen centuries of brutal conflict, religious divides, wily entrepreneurship, and intellectual and cultural flourishing on par with any place in the world. The 17th and 18th centuries were particularly momentous years for the scattered, warring peoples who lived in the world’s highest mountains. Gushi Khan, the founder of the Mongol Dzungar Khanate that politically united Tibet and established the primacy of the Dalai Lama. Tibet, at the time, was very much the politico-cultural center of the Himalayan peoples, and was torn by conflict between the great noble houses and ambitious monastic schools. Appealing to Mongol aid, the Dalai Lamas eventually emerged from the chaos into the political and spiritual role through which they would rule the Tibetans until the present day. Meanwhile, a certain lama fleeing powerful rivals in Tibet had subdued most of Bhutan’s tribes, turning it into a united kingdom for the first time. From Tibet, also, came a family, supposedly descended from another great monk, who united Sikkim and extended it up to the Chumbi Valley, where it was contested with the new state of Bhutan.

India’s approaches to the South China Sea Balancing priorities and prioritising balance

India must play a careful game as it balances its security, economic development and relationship with China, writes Ulises Granados.During the last four years, India has advanced its Act East Policy, an upgraded version of the 1990s Look East Policy. The new approach now encompasses a more robust political and security engagement with Asia, an area spanning from the Indian Ocean Region (IOR) to Southeast Asia and the Pacific Ocean. As its economic and geopolitical importance has grown, India’s pursuit of economic security has moved beyond the country’s immediate geographic realm (the subcontinent and the IOR). New Delhi is now increasingly fostering economic, political and diplomatic bonds with selected East Asian states and the US.

US-China tariff war may be a boon for India, say experts

With the US and China reducing their engagement in the area of trade, India could seize the opportunity to increase its presence in the two markets, say trade experts. “Because of their growing disengagement as they slap tariffs on one another, it gives India a platform to engage more with both the countries and increase presence,” said a Delhibased trade analyst. This means investment-led trade with China and more strategic engagement with the US in terms of defence, technology and space, among others. China has already extended the olive branch to India by expressing interest in investing here and addressing the huge trade deficit that India has with it. “India will become a very important player as the two largest economies of the world deny each other market access,” said another trade expert.

Pakistan seeks bailout from China and Saudis, rather than the IMF


A Pakistani currency dealer counts Chinese yuan for a customer at his shop in Quetta on January 3. But officials now want to use the Pakistani rupee to pay for imports for a massive Chinese project. Pakistan plans to seek financial assistance from China and Saudi Arabia to get out of the grave financial crisis it faces to bridge the country’s external account deficit ahead of budgetary proposals for the 2018-19 fiscal year.A well-placed source in the Ministry of Finance told Asia Times that instead of approaching the International Monetary Funds (IMF) for a bailout, officials have proposed that the government ask wealthy friends such as China and Saudi Arabia to help Pakistan overcome its dire economic situation.

Careful What You Wish For—Change and Continuity in China’s Cyber Threats

By Elsa Kania

Although there’s been a discernible reduction in the magnitude of Chinese cyber intrusions in the past few years, the threat has been transformed, not diminished. While U.S. diplomacy has helped reshape Chinese cyber activities during this period, the reorganisation and professionalisation of Chinese cyber forces constitute a greater long-term challenge. [N]either country’s government will conduct or knowingly support cyber-enabled theft of intellectual property, including trade secrets or other confidential business information, with the intent of providing competitive advantages to companies or commercial sectors. This agreement was initially hailed as a ‘significant step’ despite strong skepticism about its prospects for success. Initially, reports and assessments pointed to a distinct decrease in the operations of Chinese advanced persistent threat (APT) groups, although a range of factors other than U.S. pressure likely accounted for the change.

If There’s a U.S.-China Trade War, China May Have Some ‘Unconventional Weapons’

By Neil Irwin
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ImageUnloading imported soybeans at a port in Nantong, Jiangsu Province, China, on Wednesday. China has said it will raise tariffs on American soybeans, among other products. Until Thursday afternoon, there had been a reassuring sense of restrained, tit-for-tat reciprocity in the trade skirmish between the United States and China. But if this spirals into a bigger conflict between the world’s two biggest economies — something that seemed to become more likely Thursday evening with President Trump’s threat to add $100 billion more in tariffs — it’s worth keeping something in mind: In a trade war, the usual rules of commerce may not apply.

Why China Is Confident It Can Beat Trump in a Trade War


The state news media has depicted him as a reckless bully intent on undermining the global trading system, while presenting the Chinese government as a fair-minded champion of free trade. And China’s leader, Xi Jinping, has used the standoff to reinforce the Communist Party’s message that the United States is determined to stop China’s rise — but that it no longer can. China is already too strong, its economy too big. “China is not afraid of a trade war,” the vice minister of finance, Zhu Guangyao, declared at a news conference to discuss possible countermeasures. More than once, he cited the history of the “new China” — which began its extraordinary economic revival four decades ago — as evidence that it would “never succumb to external pressure.”

How China Ends Wars: Implications for East Asian and U.S. Security

by Oriana Skylar Mastro

How would China end wars? In the major wars it has fought since 1949, Beijing exhibited problematic tendencies in the three factors key to timely war resolution. Since those conflicts, changes in China are likely to magnify Beijing’s pernicious war termination tendencies further. How should the United States adjust?


We unearthed thousands of internal documents that help explain how the Islamic State stayed in power so long. On five trips to battle-scarred Iraq, journalists for The New York Times scoured old Islamic State offices, gathering thousands of files abandoned by the militants as their ‘caliphate’ crumbled.By Rukmini Callimachi Photographs by Ivor Prickett April 4, 2018 MOSUL, Iraq — Weeks after the militants seized the city, as fighters roamed the streets and religious extremists rewrote the laws, an order rang out from the loudspeakers of local mosques. To make sure every government worker got the message, the militants followed up with phone calls to supervisors. When one tried to beg off, citing a back injury, he was told: “If you don’t show up, we’ll come and break your back ourselves.”
RUKMINI CALLIMACHI, a New York Times foreign correspondent, has covered ISIS since 2014. She has tracked the group's rise around the world from their encrypted, online chatrooms to on-the-ground reporting on four continents. Her new audio series, Caliphate, launches later this month.

Al-Qaeda’s Long Game

Islamist fighters from the al-Qaida affiliate in Syria wave their movement’s flag at the Yarmuk Palestinian refugee camp, south of Damascus, in July 2014. A new propaganda video from a resurgent al-Qaeda shows its leader, Ayman al-Zawahiri, positioning himself as the unifier of a fragmented jihadi movement. But it also echoes the group’s laser focus on its historical arch-enemy: the United States. ISIS’s propaganda machine is going dark as the group is cleared from its final strongholds in Iraq and Syria. Quietly in the shadows, accompanying ISIS’s territorial demise has been an equal and opposite resurgence by its jihadi rival, al-Qaeda.

The Cities With The Most Five Star Hotels

by Niall McCarthy

A long list of luxurious hotels can say a lot about a city from the quality of its shopping opportunities to the number of upmarket attractions it can offer. Indeed, when it comes to planning a luxurious getaway, some places offer more options than others with London standing out in particular. The UK's capital has 75 five star hotels according to a report from Knight Frank which used Five Star Alliance data, the most five star hotels of any city in the world. The extensive list of luxurious listings does push up hotel prices across the board, however, with HRS reporting that a room averages $217 per night, placing London among the top-5 cities with the most expensive hotels worldwide.

Civilizations: Past, Present, and Future

by Frank Li

As a species, we must compete for survival. We compete against not only nature, but also other species. Additionally, we also compete among ourselves. At the center of this competition is the notion of a nation-state (e.g. Make America Great Again or Make China Great Again), or more broadly, "civilization" (The Clash of Civilizations).

1. What is a civilization?

Trump Makes American Coal Great Again — Overseas

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President Donald Trump vowed to make U.S. energy dominance a cornerstone of his foreign policy, and, sure enough, the United States this year is producing and exporting record amounts of oil and natural gas. More surprising, though, is the huge resurgence in U.S. exports of coal to countries all over the world, from Argentina to Ukraine. It’s a big silver lining for the beleaguered coal sector that has seen production and exports steadily dwindle in recent years.


by Tod Lindberg

The U.S. military has created a new precedent for how to counter Russian “hybrid war.” Set in a murky clash of arms in Syria in early February, and one averted in March, this precedent—you might even call it a “red line”—will reverberate from the Middle East to the Black and Baltic seas. The problem is the appearance on your territory of what defense-policy wonks call “little green men.” They come heavily armed and dressed for combat. They operate at the direction of a government, Vladimir Putin’s Russia. Yet they wear no insignia, and their sponsors deny any control over them. Operating outside the laws of war, they pursue Russian political ends such as the illegal takeover of Crimea and the dismemberment of Ukraine. Via a Russian mercenary paramilitary company called Wagner Group, they have turned up to support Russian ends in Syria as well.

The new communists In Budapest and Warsaw, nationalist governments are stealing pages from their predecessors’ playbooks.


In the weeks ahead of Hungary’s parliamentary election on Sunday, postboxes across the country delivered some welcome news — courtesy of the prime minister. One letter informed households that due to a one-time action by the government, their next gas bill would be reduced by roughly €38. Another, delivered to each of the country’s more than 2 million pensioners, contained about €32 in gift vouchers. Much has been written about the assaults on press freedom and civil society by Central European governments in Budapest and Warsaw. Far less attention has been paid to a fact their critics prefer to elide: They keep winning elections.


Justin Lynch and Lauren Fish

Just to survive, our formations, whatever the wire diagram looks like, will likely have to be small. They will have to move constantly. They will have to aggregate and disaggregate rapidly.

When the US military prepares to fight its next major war, it won’t be planning to fight the insurgents it has faced over the last fifteen years. As China and Russia begin to aggressively project their military might and revisionist ideas, the Pentagon must develop operational concepts aimed at outpacing technologically sophisticated nation-states.

Russia Develops a New Ideology for a New Cold War

By: Pavel Felgenhauer

It has become increasingly common to proclaim the present standoff between Russia and the West as a “new cold war,” and one possibly worse and potentially more dangerous than the first because of a lack of agreed rules of play or crisis management. But until now, one important feature seemed to be lacking—a basic ideological conflict. This had been the axis of the previous confrontation: free market economy and democracy versus rigid Marxist/Leninist ideology and totalitarian rule.

Is Russia on the Doorstep of the Seventh Military Revolution?

By: Sergey Sukhankin

Army General Valery Gerasimov, the chief of the General Staff of the Russian Armed Forces, presented his reflections on future conflicts, on March 24. Notably, he argued that “the enemy’s economy and command-and-control system (C2) will be priority targets [for potential Russian attacks].” And aside from traditional warfighting domains, Russian forces will increasingly operate in the information sphere and outer space (Tvzvezda.ru, RIA Novosti, March 24; see EDM, April 3).

The Smartphone War

by Lindsay Palmer 

Every few seconds my iPhone lights up with new posts on a WhatsApp group linking doctors in the Damascus suburb of eastern Ghouta to journalists in the outside world. News of Russian and Syrian government bombardment comes more or less in real time: “Before three hours in Ghouta, Russian plane tracked ambulances and hit both ambulances and hospitals.” “Dr Hamza: I have treated twenty-nine cases so far, the majority are children.” Visuals are captioned in Arabic and English: “Photos of shelters that local residents dug under their homes.” The journalists, who include correspondents from The New York Times, The Washington Post, and other international newspapers, use the group to clarify the numbers of casualties and check locations of attacks, while broadcast media request Skype interviews from inside the war zone. 

History isn't a 'useless' major. It teaches critical thinking, something America needs plenty more of


Since the beginning of the Great Recession in 2007, the history major has lost significant market share in academia, declining from 2.2% of all undergraduate degrees to 1.7%. The graduating class of 2014, the most recent for which there are national data, included 9% fewer history majors than the previous year's cohort, compounding a 2.8% decrease the year before that. The drop is most pronounced at large research universities and prestigious liberal arts colleges.

Is a Free Society Stable?

by Milton Friedman

Editor’s note: This essay is an excerpt of the new Hoover Press book Milton Friedman on Freedom, edited by Robert Leeson and Charles G. Palm. It originally appeared in the “New Individualist Review” in 1962. There is a strong tendency for all of us to regard what is as if it were the “natural” or “normal” state of affairs, to lack perspective because of the tyranny of the status quo. It is, therefore, well, from time to time, to make a deliberate effort to look at things in a broader context. In such a context anything approaching a free society is an exceedingly rare event. Only during short intervals in man’s recorded history has there been anything approaching what we would call a free society in existence over any appreciable part of the globe. And even during such intervals, as at the moment, the greater part of mankind has lived under regimes that could by no stretch of the imagination be called free.

A History of Fake News

By George Friedman
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The term “fake news” entered American political discourse during the 2016 election with both Democrats and Republicans charging each other and the media with generating fake news. Ever since, there have been countless stories about how public opinions are manipulated for political gain. Last month, it was revealed that a consulting firm called Cambridge Analytica acquired Facebook user data and used it to try to influence voters in the run-up to the election. This week, lawmakers in Malaysia approved a law making it a crime to spread fake news, punishable by up to six years in prison. Fake news has become a global issue that affects the core of contemporary information technology. It has gone from a charge hurled during an American political campaign to an issue shaping global political discourse.

Facebook Says Cambridge Analytica Harvested Data of Up to 87 Million Users

By Cecilia Kang and Sheera Frenke

WASHINGTON — Facebook on Wednesday said that the data of up to 87 million users may have been improperly shared with a political consulting firm connected to President Trump during the 2016 election — a figure far higher than the estimate of 50 million that had been widely cited since the leak was reported last monthMark Zuckerberg, the company’s chief executive, also announced that Facebook would offer all of its users the same tools and controls required under European privacy rules. The European rules, which go into effect next month, give people more control over how companies use their digital data.

When artificial intelligence goes wrong

Anirban Sen

As the use of artificial intelligence (AI) grows, researchers warn of bias creeping into algorithms such as Beauty.AI, which chose beauty pageant winners based on skin colour Even as artificial intelligence and machine learning continue to break new ground, there is enough evidence to indicate how easy it is for bias to creep into even the most advanced algorithms. Bengaluru: Last year, for the first time ever, an international beauty contest was judged by machines. Thousands of people from across the world submitted their photos to Beauty.AI, hoping that their faces would be selected by an advanced algorithm free of human biases, in the process accurately defining what constitutes human beauty.

How Cambridge Analytica’s Facebook targeting model really worked – according to the person who built it

Matthew Hindman

The researcher whose work is at the center of the Facebook-Cambridge Analytica data analysis and political advertising uproar has revealed that his method worked much like the one Netflix uses to recommend moviesIn an email to me, Cambridge University scholar Aleksandr Kogan explained how his statistical model processed Facebook data for Cambridge Analytica. The accuracy he claims suggests it works about as well as established voter-targeting methods based on demographics like race, age and gender. If confirmed, Kogan’s account would mean the digital modeling Cambridge Analytica used was hardly the virtual crystal ball a few have claimed. Yet the numbers Kogan provides also show what is – and isn’t – actually possible by combining personal data with machine learning for political ends.

What will space exploration look like in the future?

Nayef Al-Rodhan

The process of assembling the International Space Station (ISS) started in 1998 and was completed in 2011, with five partners involved: Canada, Europe, Japan, Russia and the United States.It was initially planned to operate only until the year 2020, but in 2014 the US decided to extend its life until 2024. Since then Russia has proposed to extend further the life of the ISS to 2028, and the US space agency NASA seemed ready to accept this new extension. However, major space policy changes happened in the US in 2017, with the revival of a high-level White House body, the National Space Council (NSpC), chaired by the Vice President. The new priority of the White House is a return to the Moon in the 2020s, as a step towards Mars in the 2030s.

Will the U.S. Ever Switch From Cyber Defense to Offense?

By John Breeden II
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One of my favorite lyrical quotes from music is “It's not the end of the world, but I can see it from here,” by the Welsh rock band Lostprophets, from their hit song of the same name. It’s a deep statement on many levels, simultaneously assuring listeners that the end of the world is not directly upon us, but that we need to be careful because we are moving in that direction.

The U.K.'s 'Fusion Strategy' Warfare Doctrine Looks Familiar

by Leonid Bershidsky

Modern warfare is, in part, about marketing. So, in its National Security Capability Review , the U.K. government chose a glitzy, tech-sounded new-age name: "fusion strategy." That may have part been to avoid the term "hybrid warfare" often applied to today's Russian warfighting. The difference is subtle but important. "Call it non-linear war (which I prefer), or hybrid war , or special war , Russia’s operations first in Crimea and then eastern Ukraine have demonstrated that Moscow is increasingly focusing on new forms of politically focused operations in the future," British Russia expert Mark Galeotti wrote in the blog post that launched (to the author's lasting regret) the inaccurate term "Gerasimov Doctrine." He was referring to the 2013 speech by General Valery Gerasimov, chief of the Russian General Staff. In it, Gerasimov dissected a purported Western war strategy, employing propaganda and economic warfare to soften up the adversary for military action by special forces aided by private military companies and domestic opposition. He argued that Russia should preempt these efforts, rather than copy them. 


Gen. Tony Thomas

1. At your first meeting with your first platoon sergeant:

Shut the door, tell him or her, “I think I’ve had a pretty good preparation to be a PL, but before I do anything, how about you tell me what you expect of me?” If they are good, and most of them are very good—and you aren’t the first or last PL they’ll have the privilege of serving with—they’ll say, “Be our leader, make the tough decisions, don’t try to be our buddy (we may eventually like you, but that’s not the objective), enforce the standards.” (And, while they may never say it, you can take to the bank that they will strive to never let you fail). You may be an LT, but you are their LT.