[Wed, 30 Mar 2022]

• The world this week
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The world this week

Politics

Volodymyr Zelensky, Ukraine’s president, said there was “nothing left” of Mariupol after three weeks of indiscriminate Russian shelling. The 100,000 remaining residents are desperately short of food. The Pentagon said that Russian soldiers had entered part of the port city. But defenders continued to resist. More than 3.5m people have fled Ukraine since Vladimir Putin’s invasion began.

Elsewhere Russia struggled. NATO estimated that it had lost more than 7,000 soldiers in a month. Ukrainian troops went on the offensive in parts of the country, attempting to retake Kherson, a southern city. Russian forces near Kyiv, the capital, have not advanced for two weeks, though missiles continue to strike the city.

Mr Zelensky said that any peace deal with Russia would have to be approved by a nationwide referendum. He has also insisted on a meeting between himself and Mr Putin. Talks have so far made little progress. Russia wants Ukraine to declare itself neutral, give up Crimea and Donbas and largely disarm. It also wants the West to end sanctions. Ukraine fears such a deal would leave it nearly defenceless, and notes that Russia has broken previous promises to pull back its troops.

Jens Stoltenberg, NATO’s secretary-general, said the alliance would send four new battle groups to eastern Europe, doubling its military presence there. NATO currently has around 40,000 troops stationed on its eastern flank between the Baltic Sea and the Black Sea.

North Korea test-launched what appeared to be its largest intercontinental ballistic missile ever, according to South Korean officials. Japan called the launch “reckless”.

Rishi Sunak, Britain’s chancellor, announced giveaways including a cut in fuel duty, a higher threshold at which people pay national insurance (a payroll tax) and a lower standard rate of income tax from 2024. But living costs are soaring and Mr Sunak’s new measures offset only around a sixth of previously announced tax increases as a share of GDP.

Madeleine Albright, the first woman to serve as America’s secretary of state, died aged 84. An immigrant from Czecho slovakia, she served in the post from 1997 to 2001 during Bill Clinton’s presidency. In 1999 she led calls for the NATO bombing campaign that helped end ethnic cleansing in Kosovo.

Canada’s prime minister, Justin Trudeau, looks likely to stay in power until 2025, after his Liberal party struck a “supply and confidence” deal with the New Democratic Party. The Liberals will continue to govern as a minority, with support from the other left-leaning party, whose goals on social issues, the environment and housing the Liberals promise to advance.

Judge dread

Erika Aifán, a Guatemalan judge, resigned and fled to the United States after attempts to strip her of immunity appeared close to success. Ms Aifán, who also faced death threats and lawsuits, was overseeing a case involving alleged corruption by the president.

Brazil’s Supreme Court blocked Telegram, a messaging app, for several days. The court argued that the app had ignored its orders over battling disinformation ahead of October’s presidential election. Separately YouTube said it would remove videos peddling lies about fraud in the 2018 election. President Jair Bolsonaro has claimed his margin of victory would have been bigger were it not for vote-rigging.

A trip to the Caribbean by the Duke and Duchess of Cambridge, intended to strengthen the British monarchy’s links with Commonwealth countries after Barbados removed the queen as head of state, sparked protests. A group of Jamaican politicians, business leaders and activists called on the royal family to apologise for colonialism, and demanded reparations for slavery. The couple cancelled another engagement in Belize, which also saw demonstrations.

On March 23rd, when Afghan girls were supposed to go back to school, the Taliban said that female secondary-school pupils would have to stay at home. Officials said the girls’ uniforms were immodest, and so violated Islamic law. When the Taliban previously ran the country, girls’ education was entirely banned.

Imran Khan, Pakistan’s prime minister, is facing a no confidence motion as early as next week. Coalition partners as well as lawmakers from his party say they have lost faith in Mr Khan, owing to his economic mismanagement. His relationship with the armed forces, without whose blessing no Pakistani leader can survive, has deteriorated.

At least eight people were killed in Mogadishu, Somalia’s capital, in an attack by suspected jihadists near the international airport complex. The complex houses foreign embassies and the headquarters of an African peacekeeping force.

After a decade of isolation from his fellow Arab rulers, President Bashar al-Assad of Syria came in from the diplomatic cold by visiting the United Arab Emirates. America expressed “profound disappointment” at his reception.

Spain shifted its position on Western Sahara, its former possession, by backing Morocco’s plan to give the territory limited autonomy. Algeria, which backs Polisario, the indigenous guerrilla movement that has been seeking independence for nearly half a century, was furious. Polisario said Spain had made “a grave error”.

China battled to keep a wave of the Omicron variant of covid-19 under control. The country reported its first two covid deaths in over a year. Shenyang, a north-eastern city of some 9m people, has locked down and Shanghai Disneyland has closed until further notice.

New Zealand will scrap some vaccine mandates and ease other covid-19 restrictions. Jacinda Ardern, the prime minister, called it “a new beginning”. Meanwhile New York’s mayor, Eric Adams, announced plans to end a school mask mandate for children under the age of five.

The world this week

Business

Moscow’s stock exchange resumed partial trading nearly a month after it closed. The phased reopening began with trading in local bonds, followed by 33 equities including state lenders Sberbank and VTB. Russia’s central bank said foreigners would be barred from selling local stocks or rouble treasury bonds until April 1st. It also banned short selling.

Western companies continued to cut ties with Russia. Nestlé, the world’s biggest food company, pulled brands such as KitKat and Nesquik from Russia but said it would continue to sell essential items. BNP Paribas and Crédit Agricole became the latest banks to pull out. Renault, a carmaker, suspended operations at its Moscow plant and unveiled plans to exit its Russian venture, AvtoVaz. TotalEnergies said it would stop buying oil from Russia by the end of this year, though it stopped short of joining its peers in divesting its oil and gas assets in the country.

Big oil’s comeback

Saudi Aramco, the world’s biggest oil producer, said it would invest up to $50bn a year to boost production after more than doubling its annual net income in 2021 to $110bn. Aramco and its peers have profited from a sharp rise in oil prices, which topped $120 a barrel on March 23rd.

Gas prices surged by nearly a third after President Vladimir Putin ordered Russia’s central bank to push for rouble payments for natural-gas purchases from countries it deems hostile, including America, Britain and members of the European Union. The decision comes as the Biden administration and European Union explore a deal to slash Europe’s dependency on Russian gas.

The Securities and Exchange Commission (SEC), a financial regulator, proposed new rules forcing public companies in America to disclose climate-related risks and greenhouse gas emissions. If finalised, the rules would mark the first mandatory disclosures required by the SEC on climate risk.

Inflation in Britain rose to a 30-year high, pushed up by soaring global prices for energy, petrol, food and durable goods. Consumer prices were 6.2% higher in February compared with a year earlier, making it the fastest annual increase since 1992.

The International Monetary Fund said Egypt has asked for support as the war in Ukraine pushes wheat and oil prices higher. Egypt, the world’s biggest wheat importer, is heavily reliant on supplies from Russia.

Evergrande, an indebted Chinese developer, delayed the publication of its annual results following a disclosure that lenders had seized around 13.4bn yuan ($2.1bn) of deposits from the group. The property giant, which has more than 1.97 trillion yuan ($305bn) in liabilities, said it had launched an independent investigation into the matter.

Share prices in Boeing, an American aircraft manufacturer, fell after one of its 737-800 jets crashed in southern China with 132 people on board, renewing concerns about the company’s safety record. China Eastern Airlines said it would ground its 737 aircraft and India’s aviation regulator placed the country’s entire fleet of 737 jets under enhanced surveillance.

Credit Suisse, a Swiss bank, said it could be forced to pay more than $500m in damages in a lawsuit brought by the former Georgia prime minister, Bidzina Ivanishvili. The ruling will be decided in a Bermudan court. Credit Suisse will announce its first-quarter results on April 27th.

Alibaba, a Chinese e-commerce giant, increased its share buyback programme to a record $25bn after slowing growth and a crackdown by Beijing on the tech sector. China’s tech stocks have been weighed down by volatile trading. Alibaba’s share price has fallen by around half in the past year.

Warren Buffett sent Berkshire Hathaway’s share prices soaring following an $11.6bn cash acquisition of Alleghany, an insurer, in the conglomerate’s largest deal in six years. The purchase will dip into Berkshire’s $147bn cash pile.

Ferretti Group, an Italian yacht maker, launched an initial public offering on the Hong Kong stock exchange to raise up to $300m. The company downplayed the potential fallout from sanctions against Russian oligarchs.

Kohl’s, one of America’s largest department stores, said it was reviewing offers from potential buyers following activist pressure to sell itself. The company previously rejected bids from investment firms that valued it at $9bn.

Two private islands that were owned by the late, disgraced financier, Jeffrey Epstein, went on sale for $125m. Proceeds will go towards resolving outstanding lawsuits and other costs incurred by the Epstein estate.

The world this week

KAL’s cartoon

Dig deeper into the subject of this week’s cartoon:
For all America’s success in helping Ukraine, hard times lie ahead
In Ukraine, Biden must relearn Truman’s lessons from the cold war
The EU’s unity over Ukraine has given it surprising heft
The friendship between China and Russia has boundaries

KAL’s cartoon appears weekly in The Economist. You can see last week’s here

Geopolitics and energy

Why energy insecurity is here to stay

ENERGY AND commodities lie at the dark heart of Vladimir Putin’s regime and the threat it poses to the world. Four trillion dollars of oil and gas exports over the two decades of his rule have paid for the tanks, guns and Grad missiles now killing Ukrainians. Natural-resource earnings have entrenched a rent-seeking elite that has created an offshore archipelago of yachts, nightclubs and Caribbean front companies, stifled representative politics and indulged Mr Putin’s megalomaniacal fantasies.

As Russia supplies 10-25% of the world’s oil, gas and coal exports, many countries, especially in Europe, are vulnerable to coercion by it. For them, the war in Ukraine has been a shock that adds urgency to the creation of an energy system which depends more on sun, wind and nuclear reactors than on derricks and rigs. Yet don’t fool yourself that this new era will allow an easy escape from the curse of energy crises and autocrats.

Weeks of chaos in energy markets are beginning to hurt consumers. Petrol prices in Los Angeles are over $6 a gallon for the first time. As sanctions on Russia bite, traders predict, Europe will run short of diesel. Germany is preparing to ration natural gas next winter, in case Russia cuts off supplies. In Asia, oil importers are bracing for a balance-of-payments hit. In a tight market, shocks are hard to absorb. Oil spiked at $122 per barrel this week after a pipeline from Central Asia to the Black Sea suffered storm damage and Iranian-backed Houthi rebels attacked Saudi energy facilities.

The immediate reaction of governments everywhere has been to scramble to find more fossil fuels, however polluting to the environment or painful to their pride. With Western encouragement, Saudi Aramco, the world’s biggest oil firm, is raising investment to $40bn-50bn a year. At one point, the Biden administration buttered up Nicolás Maduro, Venezuela’s dictator, perhaps to get more oil from a state which in 2005 supplied 4% of the world’s crude.

The longer-term question being asked by many is: how fast can they abandon fossil fuels altogether? The energy strategy announced this month by the EU envisages independence from Russia by 2030—in part by finding new sources of gas, but also by doubling down on renewables. As the folly of relying on Russia becomes clear, nuclear power is back in fashion. France plans to construct six new plants and is aiming for “total energy independence”. On March 21st Britain said it would build a new generation of reactors at “warp speed”. A redesigned energy system that will belch out less carbon also promises an escape from the 20th century’s great game of relying on energy from despots.

Yet although geopolitics will hasten the climate-driven energy transition, they will not make it risk-free. The transition will disrupt some economies and cause new dependence on others. To gauge this we have simulated spending on a basket of ten natural resources, including oil and coal, and the metals used in power generation and the electrification of industry and transport. As the world decarbonises, spending on this basket will fall from 5.8% of GDP to 3.4% by 2040. Yet in our simulation over half of that will still go to autocracies, including new electrostates that provide green metals such as copper and lithium. The top ten countries will have a market share of over 75% in all our minerals, which means production will be dangerously concentrated.

Two problems therefore stand out. First, the geopolitics of shrinking the oil industry are fraught. As Western firms withdraw for environmental reasons and in response to high costs, the market share of OPEC plus Russia will rise from 45% to 57% by 2040, giving them more clout. Higher-cost producers such as Angola and Azerbaijan face a shock as they are squeezed out. The world map will be peppered with distressed ex-petrostates.

Second, the emerging electrostates face their own battle with the resource curse. Spending on green metals will surge amid a two-decade-long build-out of electric infrastructure. The windfall may be worth over $1trn a year by 2040. Some beneficiaries, such as Australia, are well-equipped to deal with this. More fragile states, including Congo, Guinea and Mongolia, are not. Mountains of cash distort economies and feed grievances. Mining was a source of discord in recent elections in Chile and Peru. Global mining firms are nervous that their property rights will be buried. A resulting lack of investment has sent the price of a basket of green metals up by 64% in the past year. All this is compounded by China, which is hunting for the same resources, but is more tolerant of bad governments.

As with all commodities, soaring prices will eventually trigger a market response. Tight supply gives firms a huge incentive to step up recycling and to innovate. New kinds of small-scale nuclear reactors are emerging. Tesla, which uses minerals to make electric cars, is developing new battery designs. It has also struck a supply deal with New Caledonia, a Pacific territory of 277,000 people you will hear more about because it has a tenth of the world’s nickel reserves. This month Barrick, a Canadian firm, took a deep breath and agreed to develop a $10bn copper mine in Pakistan.

High-voltage rewiring

Yet even as markets respond, governments must also redouble their efforts. Because self-sufficiency is rarely an option, diversification is the goal. That means new partnerships. On March 20th Germany began talks with Qatar for gas. The invigoration of the rich world’s nuclear industry is key, not least because it frees everyone else from relying on Chinese and Russian technology. Governments must catalyse mining investment. Firms should not be free to blow up sacred caves or endanger workers, but the transition requires more mining projects in high-risk countries at a cost to the local ecology. Governance rules in wealthy countries need to acknowledge the trade-off. Finally, rich-world governments should help electrostates prepare by, for example, helping design model contracts for a fair split of revenues and establishing sovereign-wealth funds to save the bounty.

Building a cleaner and safer energy system is an epic, risky and daunting task. But whenever resolve flags, ask yourself: would you rather rely on Mr Putin’s Russia? ■

Read more of our recent coverage of the Ukraine crisis.

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Escaping zero-covid

China must eventually learn to live with the coronavirus

AN OUTBREAK OF covid-19 on the scale China is experiencing would barely register in most countries. Much of the world has decided to live with the virus. Not China, though. So far in March it has recorded around 27,000 new local symptomatic cases—and each one is viewed as a threat to the government’s “zero-covid” policy. For two years China has smothered outbreaks using mass-testing, strict lockdowns and by tracking its people in ways that would make Mark Zuckerberg blush.

Chinese leaders think their policy a huge success. The Economist estimates that the country’s death rate from covid is 5% of America’s. The Chinese economy has expanded by 10.5% in the past two years, compared with 2.4% in America and 0.4% in advanced economies generally. China’s covid controls “demonstrate the advantages” of the Chinese Communist Party’s leadership and the socialist system, boasts Xi Jinping, the president. All the signs are that his people tend to agree.

Yet the party hid the start of the pandemic, and seemingly failed to anticipate the difficulty of crushing a highly transmissible variant like Omicron. China’s leaders have acted as if they could close off their country until covid went away. Instead, sketchy preparation for an Omicron-type outbreak has put China at risk of a catastrophe.

The experience of Hong Kong shows what could happen. Like the mainland, Hong Kong once boasted a very low case-count. But Omicron has overwhelmed the city, which now has the highest daily death-rate in the world from the virus. Hospitals have left patients waiting in loading bays and car parks. The vast majority of the dead have been unvaccinated old folk. When the outbreak began, around 65% of over-80s had not been jabbed.

The risks are similar on the mainland. Among those 80 and older, only 51% have received two jabs, and less than 20% have had a booster. Many Hong Kongers were given Western vaccines. The Chinese government, apparently for political reasons, refuses to allow these on the mainland. Three doses of the home-grown kind do offer some protection against severe disease and death, but it seems to wane more quickly than the protection provided by Western vaccines.

For now, China has little choice but to stick with its covid controls. The problems go beyond vulnerable old people. China’s skimpily funded health system is ill-equipped to handle a big wave. Using Hong Kong’s mortality rates as a guide, a large outbreak on the mainland would result in millions of deaths. The lingering trouble is that Chinese officials lose their jobs if an outbreak occurs on their watch. Fear of the sack creates incentives to invent sometimes cruel and irrational local rules.

In the longer term, though, change is inevitable. More transmissible variants like Omicron make the cost of enforcing zero-covid very high. Today tens of millions of people are locked down. Morgan Stanley, a bank, thinks China’s GDP may not grow at all this quarter compared with the last. That could affect the global economy. Restrictions in Shanghai and Shenzhen, accounting for more than 16% of China’s exports, raised alarm once again about supply chains.

China needs to help its people live with covid. It has made a start by allowing at-home tests, and sending patients with mild symptoms to isolation centres, not hospital. Mr Xi has urged officials to cut the economic impact of covid controls. More must be done. The elderly and vulnerable need vaccinating and boosting, fast. China has approved an antiviral pill, Paxlovid, from an American firm, Pfizer: why not use Western vaccines, too?

But Mr Xi still seems attached to zero-covid in the longer term. Having staked its legitimacy on keeping cases near zero, the party is loth to change strategy. Soon it will have no choice. Even if China succeeds in seeing off this wave, another will follow. The government needs to devote as much energy to charting a path out of the zero-covid policy as it has to enforcing it. ■

Ukraine’s backers

For all America’s success in helping Ukraine, hard times lie ahead

VLADIMIR PUTIN’S epoch-changing miscalculation over Ukraine was the outcome of a trio of mission-defining misjudgments. One was that Ukraine’s government would collapse quickly. Another was that his modernised army would be dominant. The last was that America, in irreversible decline, was no longer capable of leadership. For Ukraine to be defeated, Mr Putin had only to get one premise right.

The first two misjudgments have caused general surprise. The third has stirred up general interest, among allies and foes alike. In recent years America has seemed less committed to the institutions it created after the second world war, largely as a result of its own disastrous occupation of Iraq following the attacks of September 11th 2001. Barack Obama chose to “reset” relations with Russia after it invaded Georgia in 2008 and failed to enforce a red line against the use of chemical weapons in Syria. Donald Trump accused his allies of duping America and called NATO “obsolete”. After America’s humiliating flight from Kabul last summer, Mr Putin seemed to have concluded that Joe Biden would be unable or unwilling to do much for Ukraine.

Today, as Mr Biden lands in Europe for NATO, G7 and EU summits, it is clear that America has confounded Mr Putin by being innovative, agile and resolute. It understands that the security of Europe is at stake in Ukraine. The question is whether that success can survive the tests that lie ahead. At home, destructive political partisanship is once more rearing its head. In Europe, the coalition that America so carefully stitched together is beginning to fray.

America’s innovation began before the war, with the unprecedented release of intelligence. Along with Britain, the Biden administration issued detailed, up-to-the-minute warnings about Russian troops massing on Ukraine’s borders, would-be provocations, the plan of attack and a blueprint for a puppet government. This robbed Mr Putin of the power to disorientate that served him so well in the seizure of Crimea in 2014. The supply has continued in battle. Information from intercepted communications, NATO aircraft and satellites is rapidly given to Ukrainian forces, who use it for targeting.

The agility was on display when America changed course in the opening phase of the war. Mr Putin was not alone in thinking that Kyiv would fall within days. The Biden administration offered Volodymyr Zelensky safe passage out of the capital. Ukraine’s president vowed to stay even as his forces repelled Russian paratroopers. America and its allies responded with more weapons and fresh sanctions.

And NATO has demonstrated resolve. In 2019 Emmanuel Macron, France’s president, warned that it was suffering “brain death”. Today it is reinforcing its eastern flank. Germany, its second-wealthiest member, has overturned decades of timid defence policy by agreeing to give Ukraine arms and pledging to increase spending. In its wholehearted leadership of NATO, American diplomacy has recovered from the lows of the Trump years.

The fact that the war has lasted so long is an endorsement of Mr Biden’s support. But, as it drags on, sustaining that support is becoming harder. At home some Republicans have taken to blaming Mr Biden for the war, arguing however implausibly that the real cause of the invasion was Kabul and American acquiescence over a German gas pipeline coming from Russia. They accuse Mr Biden of being weak.

In the long run, partisanship is a grave threat to American influence abroad. Mr Biden’s best riposte to his critics is to throw his efforts into dealing with the other, far more urgent political problem, which lies in Europe. This is the first sign of weariness in the coalition helping Ukraine withstand the Russian army.

Ukraine says it is short of arms. There have been pledges, including this week from Britain, but supplies could arrive too late. Ukraine also complains that NATO’s distinction between defensive weapons, such as anti-tank missiles, and offensive weapons, such as aircraft, is meaningless when the invader is bent on destruction. Diplomatic sources accuse Germany and Hungary, in particular, of standing in the way of extra sanctions.

All this is becoming an urgent problem. Mariupol, a city with a population of 400,000 before the invasion, is being razed to the ground by Russian artillery. Civilians, including children, have been deported to Russia. Mr Biden has warned that Mr Putin may be about to order the use of chemical or biological weapons. As Russian atrocities mount, Ukraine will need more help. When Mr Biden meets European heads of government he will have to stiffen their resolve. If he fails to unite his allies, his good work will have been squandered. ■

Read more of our recent coverage of the Ukraine crisis

When duty falls

Cutting fuel taxes is a bad idea

GOVERNMENTS THAT are trying to shield voters from soaring energy and fuel costs are coalescing around a simple idea: help people buy petrol. This week Rishi Sunak, Britain’s chancellor, cut fuel duty by 5p ($0.07) per litre, a 9% reduction, for a year—the most ever in cash terms. From April 1st France will rebate 15 cents ($0.16) per litre of fuel for four months. Many other European countries including Italy and Sweden have also announced cuts. Last year Japan introduced a fuel subsidy of ¥5 ($0.04) a litre, which was recently raised to ¥25. In America two states have suspended their petrol taxes and a bill has been introduced in Congress to do the same to the federal levy.

These tax cuts are a mistake. They will waste money and make it harder to wean the rich world off fossil fuels. There are better ways to help people cope with rising energy prices.

Petrol taxes, like all levies on transactions, affect both buyers and sellers. When taxes fall, buyers pay a lower total price. As a result they demand more fuel, which encourages sellers to push pre-tax prices higher. The exact division of the benefits between consumers and producers is debated, but one study of a petrol-tax holiday in Illinois and Indiana in 2000 found that consumers enjoyed only 70% of the upside.

That means today’s fuel-tax cuts are wasteful. Governments could spend the same amount of money on other policies to help households without suffering a 30% leakage. It also makes the policies perverse, because the producers who benefit include Russia, whose oil Europe continues to buy, despite its invasion of Ukraine. Although the tax policies of any one small country are unlikely to affect global oil prices much, many countries cutting fuel levies at once will boost demand on a global scale, helping to fill Russia’s coffers.

Governments should be trying to reduce the demand for fuel, not stoke it. The price of petrol tends not to have a rapid effect on how much people drive, because many trips are unavoidable. But that may be changing as working from home has given many people a daily choice about whether to commute to the office. In the short term, maintaining fuel taxes would help wean Europe off Russian oil, starving Russia’s economy of foreign currency. Even with sanctions as they are, the energy industry is warning that Europe may soon need to ration diesel, which is becoming scarce.

In the long term fuel duties lead people to switch to electric cars or public transport, reducing carbon emissions. They also mean that driving bears more of the other costs it imposes on society, such as congested roads and dirty air. These goals are less pressing than the energy crisis, and today’s cuts are presented as temporary. But fuel duties are notoriously difficult to raise because they are so unpopular, meaning that the cuts may become permanent. Nobody believes that Mr Sunak will implement the big rise he has pencilled in for a year’s time. In 2011 Britain put off a planned rise in fuel duty for seven months. It was repeatedly postponed and now Mr Sunak has cut instead. America’s federal tax on petrol has been 18.4 cents per gallon since 1993.

In both cases the tax has stayed constant even as inflation has eroded its real value and the increasing fuel-efficiency of cars has made driving cheaper. In January motor fuel accounted for little more than $1 in every $50 the American consumer spent. Adjusted for today’s higher price at the pump, the share of spending is still lower than the average since records began in 1959. Drivers notice dearer fuel, and American consumer-confidence is its lowest in over a decade. But today’s high oil price will not hurt motorists as much as the oil embargoes of the 1970s.

There are better ways to help struggling households than to lean against the price mechanism. Governments should temporarily support the income of the poor in ways that do not encourage the consumption of fuel. Mr Sunak has cut taxes on low and middle earners, which is a start, but he should also have made universal credit, Britain’s stingy main welfare benefit, more generous (see Britain section).

Calories and joules

What is more, support for incomes, unlike tax cuts for motorists, helps offset the full spectrum of forces that are eroding living standards. The biggest blow to Europe’s wallets is coming not at the pump, but through the cost of heating and electricity. Food prices have soared, too. Not everyone drives, but everyone needs warmth and sustenance. ■

Read more of our recent coverage of the Ukraine crisis

Long walk to free trade

Africa’s ambitious trade plan needs to speed up

IN 1963, AS decolonisation swept through Africa, politicians heady with pan-African ideals called for a common continental market. They saw it as a way to transcend colonial economic models based upon extracting and exporting natural resources. Sadly there has been all too little progress since. Intra-African trade remains small compared with the continent’s external trade. Primary commodities account for more than 70% of Africa’s exports. Just 18% of exports by African countries are to others on the continent—a lower share than equivalent figures for Asia (58%) and Europe (68%).

The African Continental Free Trade Area (AfCFTA) is meant to help change this. This ambitious pact has been ratified by 41 of Africa’s 55 countries. Making it easier for them to trade with one another should boost manufacturing, incomes and growth. The World Bank estimates that, if implemented, by 2035 the AfCFTA would enable an additional 30m people to escape extreme poverty, increase intra-African exports by 81% and boost wages by 10%. Although the AfCFTA has in theory been operational since the beginning of this year, in practice no trade has happened under its terms because of continued political wrangling. Africa’s leaders risk squandering the promise of freer trade.

Some of the potential benefits of the AfCFTA come from lower tariffs. To realise these, the continent’s trade negotiators still have work to do in agreeing on rules of origin, the bedrock of any trade area. They need to get their skates on.

The biggest prize, however, will come not from lower tariffs but from lower “non-tariff barriers”—by pulling down more of the other obstacles that make it hard for, say, a Ugandan farmer to export chickens to Kenya or for a Beninese weaver to sell fabric to Nigeria. These barriers include corruption, shoddy infrastructure, red tape at border crossings, sloth-like customs bureaucracies and expensive logistics. Because of them, transporting goods within Africa can be three to four times as costly as in other parts of the world. In 2017 it took an average of 251 hours to ensure paperwork was in order when importing goods into sub-Saharan Africa, versus nine hours in rich OECD countries.

Many of these problems can be fixed. Potholes could be filled; ports expanded. Paperwork could be digitised and sent in advance of time. More countries could build one-stop border posts, instead of making lorry drivers queue separately for migration, road taxes, vehicle inspection and customs clearance. In east Africa such streamlining has cut crossing times from 12 hours to four. Not requiring covid-19 tests would let lorries spend more time ferrying and less time tarrying. Countries should make it easier to establish logistics startups, such as firms that cut costs by matching loads with empty vehicles. Cheaper transport means cheaper goods in shops.

Yet all this is easier said than done. One obstacle is that vested interests, such as trucking cartels and customs bureaucracies, profit from inefficiency. Ghana has shown that these can be weakened. Another problem is that for all their homilies about free trade, many African politicians are protectionists at heart. No country seems to want to move first in ongoing talks about implementing the free-trade deal. Even though they stand to benefit the most, the largest economies in each region—Egypt, Kenya, Nigeria and South Africa—are proving pitifully slow to embrace the trade pact.

A third political challenge relates to outsiders, including America, China and the European Union. Though they say they want to support the AfCFTA, they often undermine it by signing bilateral deals which then complicate Africa’s efforts to harmonise its own trade rules.

Each of these problems requires the sort of leadership that has so far been in scant supply. But if politicians seize the opportunity, the AfCFTA can help the continent climb out of the economic slump it has been pushed into by the pandemic and the war in Ukraine. It would also send a message to the rest of the world. At a time when protectionist noises are growing louder, Africa has a chance to be an inspiring outlier. ■

Letters

• Letters to the editor: On Vladimir Putin and the West, private equity, Richard Nixon, company cults

On Vladimir Putin and the West, private equity, Richard Nixon, company cults

Letters to the editor

Letters are welcome via e-mail to letters@economist.com

The war is not the West’s fault

Russia is not an innocent victim of NATO’s expansionist policy, as John Mearsheimer claims (By invitation, March 19th). On the contrary, it is the Kremlin’s policy that forces Russia’s neighbouring countries to seek effective alliances. The problem with Mr Mearsheimer’s argument is the assumption that had NATO not expanded, Russia would be a different place today. The historical evidence does not support that.

Moreover, his arguments deprive Ukrainians of any agency. He consistently ignores the possibility that Ukrainians might choose democracy and seek membership of the European Union of their own free will (in this, he echoes Kremlin talking points). He draws a false equivalence between a liberal, wealthy economic bloc on the one hand and an authoritarian gas station run by a mafia on the other. Mr Mearsheimer should consider the distinct possibility that Russia’s long history of attempted dom inance over Ukraine, and other central and eastern European countries, is what helped drive many Ukrainians, and Poles, towards the EU.

PIOTR ARAK
Director
Polish Economic Institute
Warsaw

Mr Mearsheimer’s attempt to understand the root causes of the conflict suffers from a deeply flawed methodology: he does not understand that world politics are made by real people, rather than figments of abstractions. Thus, Russia’s security concerns are ultimately defined by Vladimir Putin, and his pre-eminent security concern is about staying, and surviving, in power. What threatens that is not NATO expansion but a “colour revolution” in Russia. A prosperous, democratic Ukraine would surely encourage popular opposition to the Putin regime in Russia, and therefore in his view it must be prevented at all costs.

Amazingly, Mr Mearsheimer suggests that Ukraine’s Maidan uprising in 2014 and the flight of Viktor Yanukovych was a “coup”. This is not only a morally murky statement because it airily dismisses the concerns and the dignity of the vast majority of 44m Ukrainians who do not want to be ruled by Mr Putin’s Russia. It also fails to understand that sometimes it is not only leaders who shape politics but also ordinary people. If Mr Mearsheimer were right, European and German unification should never have happened.

Western institutions may well have put Mr Putin “into a rage”, as Mr Mearsheimer says. NATO enlargement is not, however, at the root of the war. What happens in Ukraine is not a “direct threat to Russia’s future”: it is a direct threat to Mr Putin’s future.

PROFESSOR HANNS MAULL
Senior distinguished fellow
German Institute for International and Security Affairs
Berlin

Having grown up in communist Romania I take particular offence at Mr Mearsheimer’s notion that eastern European countries are merely a buffer zone or some kind of geopolitical pawn. Russia does not own eastern Europe. These are sovereign countries who desire nothing more than to relinquish their ties to Russia and join the free world. Eastern Europeans asked, begged, to join NATO having made enormous strides towards political reform. Should we have allowed Russia to drag them back into the abyss?

MONICA FRIEDLANDER
Cambria, California

Mr Mearsheimer writes: “The mainstream view in the West is that he [Putin] is an irrational, out-of-touch aggressor bent on creating a greater Russia in the mould of the former Soviet Union. Thus, he alone bears full responsibility for the Ukraine crisis.” That mainstream view is absolutely correct.

NICK DEYCHAKIWSKY
Brighton, Michigan

Clarity in private equity

One way to rein in private equity’s predatory behaviour (Special report, February 26th) would be to pass the Stop Wall Street Looting Act, revived in the Senate last year by Elizabeth Warren. This is far from the only campaign for more transparency in the industry.

Leaked documents show that the opacity that defines the private-equity industry, including investors’ identities, source of funds and often even the assets under owner ship, has the FBI deeply concerned that the industry is a soft target for money launderers. Anti-corruption campaigners are calling for the Financial Crimes Enforcement Network at the Treasury to finalise a stalled rule from 2015 requiring investment advisers to establish effective anti-money-laundering programmes.

No less than national security and the integrity of elections is at stake. In 2015 a software company that managed much of Maryland’s voter-registration system was bought by a private-equity fund in which a Russian oligarch with close ties to Vladimir Putin was the largest investor (the fund no longer owns the voter system).

Bringing more transparency to private equity would also be a good investment in safeguarding future public spending in a crisis. Our analysis has identified more than $1.2bn in loans for small businesses that went to companies backed by private funds. Most of these can be written off. The legislation that left open this loophole should be counted as another “dividend” of the industry’s extensive lobbying operation.

If private equity is coming into the mainstream and out of the shadows it should be prepared to play by mainstream rules and stop operating under a shroud of secrecy.

DAVID SZAKONYI
Co-founder
Anti-Corruption Data Collective
Washington, DC

Tricky Dick

The attempt to defend or exonerate Richard Nixon by Dwight Chapin, an aide to the former American president, (“Watchdog barking”, February 26th) brought to mind Hunter S. Thompson’s obituary, which, as it happens, I read whenever I feel a little blue. But that is besides the point; what isn’t, is that Mr Chapin’s book sounds like a terrible casting of the past. For a more reasonable and balanced view, I feel a refresher of what Mr Thompson wrote about Nixon is in order:

If the right people had been in charge of Nixon's funeral, his casket would have been launched into one of those open-sewage canals that empty into the ocean just south of Los Angeles. He was a swine of a man and a jabbering dupe of a president. Nixon was so crooked that he needed servants to help him screw his pants on every morning.

The recently departed Mr Thompson had many more things to say, but I believe that will suffice.

MATT TURNER
Hope, Canada

You will conform

Bartleby’s column on the common characteristics of cults and companies (March 5th) brought back fond memories of my time working for Ross Perot’s Electronic Data Systems (better known as EDS) back in the late 1980s. Company indoctrination started with a ten-week electronic boot camp with rules such as “no facial hair” and “no tassels on your shoes”. It continued after through motivational trinkets, like fluorescent erasers emblazoned with the words “rub out non-conformance”.

ANDREW VANBERKEL
Toronto

By Invitation

• Russia and Ukraine: Sir Adam Roberts rebuffs the view that the West is principally responsible for the crisis in Ukraine

Russia and Ukraine

Sir Adam Roberts rebuffs the view that the West is principally responsible for the crisis in Ukraine

WHY IS IT that John Mearsheimer, a distinguished American exponent of international relations, has reached such an apparently perverse conclusion about Russia’s “special military operation” in Ukraine? It is a “special military operation” indeed—one whose initiation and conduct have been condemned as violating the most fundamental rules and norms. Yet he argued in an article for The Economist’s By Invitation section on March 19th that “the West, and especially America, is principally responsible for the crisis which began in February 2014.”

Professor Mearsheimer does not let Vladimir Putin off the hook entirely: “There is no question that Vladimir Putin started the crisis and is responsible for how it is being waged,” he writes. But Professor Mearsheimer’s central argument is that the crisis began at NATO’s Bucharest summit in April 2008, when President George W. Bush, along with the other NATO member states, ostensibly committed the alliance to the future membership of Ukraine and Georgia. The Russian leadership was deeply opposed to the prospect of NATO extending its reach so close to the heartland of Russia.

It’s questionable whether Mr Putin was right to say NATO posed a threat to Russia’s sphere of influence. From the start in 2008 there were different interpretations of what was meant by “will become members”. For some these words, with no time-frame specified, were there to enable President Bush to return home from Bucharest with something to show for his trip. Other member states, all of whose votes would have been essential for any formal offer of membership, remained doubtful. But Mr Putin took the phrasing seriously.

Professor Mearsheimer’s argument has some strength in suggesting that the 2008 Bucharest summit declaration was a disaster. He has shown consistency in this matter. He practically invented a school of international relations called “offensive realism”, based round the idea that systems in which there are several great powers are prone to manage their mutual relations with deep rivalry and a high risk of war. One conclusion that follows from his world-view is that states are bound to take seriously the concept of “spheres of influence”, an old-fashioned term for a phenomenon that is still very much alive. However much spheres of influence may challenge the idea of the sovereign equality of states, they have by no means disappeared in international relations.

Take the 1962 Cuban missile crisis. In demanding the withdrawal of Soviet nuclear-armed missiles from Cuba, America was, in effect, defending the Monroe Doctrine of 1823. The doctrine sought to exclude European colonial rule and military presence from the western hemisphere. As for the Soviet Union, throughout the cold war it regarded virtually all of eastern Europe, where it imposed client regimes, as its sphere of influence under the euphemistic label of “commonwealth of socialist nations”.

There is no dispute now that Mr Putin wants to defend Russia’s sphere of influence. Right at the start of his speech on February 24th, as his forces invaded Ukraine, he criticised the “expansion of the NATO bloc to the east, bringing its military infrastructure closer to Russian borders”. He embarked on a tirade against the actions of the Western powers and of the Ukrainian government. He infamously claimed, without a shred of evidence, that there was an ongoing “genocide against the millions of people” in the Donbas region.

However, for Professor Mearsheimer to reduce the causes of Russia's invasion to the Bucharest declaration is simplistic and wrong. Other, more important factors were at play. For a start, there were some obvious frustrations, fears and mistakes. The continuing American strategic partnership with Ukraine, which Professor Mearsheimer mentions, may indeed have played a part, rubbing salt in the wound of NATO’s projected expansion. Ukrainian defiance in response to Russia’s huge military exercise on its border last year would have been hard for Mr Putin to tolerate. A successful and democratic Ukraine undermines the Russian leader’s own authoritarianism at home. And there was a faulty understanding of the situation on the ground: both America in Iraq and Russia in Ukraine have launched wars on terrible “intelligence”.

Alongside these proximate causes there are three other factors that help to explain the current crisis in Ukraine. The most important, and the most neglected, is that the break-up of empires is often messy and traumatic. Often foreign military intervention of some kind follows. The end of European colonial empires, and the collapse of the Soviet and Yugoslav empires in the 1990s, forced new or re-constituted states to make fateful decisions. Is citizenship based on ethnicity or simply residence? Should kin living outside the state have a right to citizenship? What frontiers does the state have? What friends and allies? What constitution? What language? Such questions have been at the heart of most of the political crises and armed conflicts of the past 100 years or more. The dozens of UN peacekeeping missions established since 1945 have all had the task of addressing post-colonial and post-imperial crises.

Both Georgia and Ukraine faced many if not all of these quandaries in the 1990s—and faced them long before the question of NATO membership arose. From the very beginning of their new existence the status of Russian minorities in Georgia and Ukraine was particularly difficult. In Georgia two breakaway republics provided a basis, or at least a pretext, for Russian intervention on occasion. In Ukraine, too, defending the rights of its two Russian-supported breakaway republics was the ostensible reason for Russian military interventions there. And in these pro-Russian republics there were forced expulsions, of Georgians and Ukrainians respectively, leading to calls that they should be enabled to return to their homes.

Second, the existence of nuclear weapons outside of Russia necessitated a degree of Western involvement in security matters. An array of nuclear weapons remained in Ukraine (and also in Belarus and Kazakhstan) following the collapse of the Soviet Union. The problem of what to do with this arsenal was addressed in the Budapest Memorandum on Security Assurances of December 5th 1994. The three post-Soviet states agreed to hand these nuclear weapons over to Russia. In return, they received security assurances from Russia, Britain and America, which all undertook to respect the sovereignty, independence and existing borders of Ukraine and the other two states. This provision was violated by Russia’s takeover of Crimea in March 2014. The breakdown of the Budapest Memorandum left Ukraine in an awkward situation. It was unable to trust Russia’s word, but also had reason to doubt Western security guarantees. The idea of full-blooded membership of NATO appeared increasingly attractive but not necessarily more attainable.

The third factor is colour revolutions—the popular revolutions that occurred in many countries in the former Soviet Union in recent decades. They must have reminded Mr Putin of the movements in eastern Europe in 1989 that precipitated the collapse of one communist regime after another. Mr Putin was deeply suspicious of the revolutions, such as the Rose revolution in Georgia in November 2003. It was the first successful assault in the former Soviet Union against the corrupt strongmen who had come to power in the immediate aftermath of communist party rule. It was followed within a year by the Orange revolution in Ukraine that threw out another such strongman, Viktor Yanukovych.

It suits Mr Putin to treat civil resistance movements as parts of a grand international conspiracy. I have been studying such movements for more than 50 years. In that time all kinds of accusations have been made that such movements are the pawns of outside forces. There is little evidence to support such theories. Professor Mearsheimer, in a lecture on “The Causes and Consequences of the Ukraine Crisis” at Chicago University in 2015, actually lent some credence to the idea that such movements verge on being an American instrument. “Our basic strategy is to topple regimes all over the world.” Evidence for this generalisation was not presented. Throughout his analysis Professor Mearsheimer pays remarkably little attention to the ideals and political desires of people in countries that have experienced “people power” revolutions.

These factors suggest that the 2008 proposal to expand NATO to include Georgia and Ukraine is just one among many developments that have made the current crisis so acute. It is arguable, indeed likely, that the NATO expansion proposal made matters worse, as may some other Western actions, but to assert that “the West is principally responsible for the Ukrainian crisis” goes too far.

Sir Adam Roberts is an emeritus professor of international relations at the University of Oxford.

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Russia and Ukraine

Jason Bordoff and Meghan O’Sullivan on maintaining energy supply while still hitting climate-change goals

AS RUSSIA’S INVASION of Ukraine becomes more violent, the world is on the cusp of what may become the worst energy crisis since the 1970s. Whereas those crises only involved oil, Russia is one of the world’s largest producers of nearly every form of energy—oil, natural gas, coal, and even the fuel used in nuclear power plants. The unfolding energy calamity demands an immediate response to keep cars moving, homes powered and heated, and to prevent a global recession induced by high energy prices. But as policymakers look for quick fixes, there is also the urgency of weaning the world from fossil fuels, as a major United Nations report made clear last month. In the long run, doing so benefits not just the climate, but also energy security for large consumers of fossil fuels. Pragmatic policies are needed that ensure secure and affordable energy today, and that help to bring about a lower carbon future.

Even though American and EU policymakers initially designed sanctions to exclude energy, the International Energy Agency (IEA) predicts nearly half of Russia’s oil exports will be off the market by April as buyers steer clear—although some of that will still flow to market at steep discounts in under-the-radar transactions with countries like China and India. Natural gas continues to flow into Europe, but Russian leaders have threatened to cut off those supplies in retaliation for sanctions. Even before the invasion of Ukraine, energy markets were tight after years of underinvestment as a result of social pressures to curb fossil-fuel spending, the pandemic and the industry’s poor recent returns. As a result, energy prices soared, before falling slightly.

In the short term, there are few options to offset lost Russian supply. For oil, they all involve complex geopolitical trade-offs with Iran, Saudi Arabia, the United Arab Emirates or Venezuela.

American production was already going to grow this year, but there are limits to what the government can do to boost that further. Governments need to be ready to authorise the release of more oil from strategic stockpiles. But even a historically large release of, say, 100-200m barrels (roughly equivalent to 1-2 months’ worth of the Russian oil that the IEA expects will soon be off the global market) will not be a panacea as the crisis worsens, and as sanctions and the stigma of doing business with Russia increase.

Replacing lost Russian natural gas, which supplies 40% of Europe’s needs will be even harder. Europe can fire up existing coal plants, import more liquefied natural gas, and dial down the thermostat, but it will take years to fully wean Europe from its dependence on Russian gas. And the urgency of climate change means the options to curb gas use are more constrained than in the 1970s, when one of the primary ways G7 countries tried to reduce oil use was to build new coal facilities.

The most meaningful options to bolster energy security require longer timeframes, and are also often the same actions needed to curb carbon emissions. As this crisis with Russia makes painfully clear, a continued dependency on fossil fuels can lead to serious geopolitical vulnerability. While clean energy sources bring their own geopolitical risks, a decarbonized energy system will also be a more electrified one, and since most clean electricity is locally produced, one with far less energy trade across borders.

Yet the world cannot ignore more immediate energy security needs in the process of making this transition. To do so emboldens petro-states like Russia and risks undermining climate action itself. If energy security and climate ambition come into conflict with one another, it is the climate that will lose out.

How can leaders better manage the gap between energy needs and green goals, particularly since the gap between the two is growing, not shrinking. A transition that meets all our energy policy goals—security, affordability and sustainability—requires three elements.

First, we must double down on the clean-energy transition. Most countries today are a long way from fulfilling their pledges to reduce carbon emissions. In America, passing the clean-energy components of President Biden’s “Build Back Better” plan–such as tax credits for clean electricity, electric vehicles, and home energy efficiency–would be a good place to start. Similarly, the European Commission’s recently announced REPowerEU plan would reduce Europe’s dependency on Russian gas by boosting energy efficiency, frontloading investments and speeding up permitting for renewable energy. Some countries are accelerating clean energy plans to reduce Russian dependence. Germany has announced that it will phase out combustion-engine cars by 2035 and speed up renewables deployment. Britain has decided to expand offshore wind “to protect national security”. And Belgium is reconsidering its plan to phase out zero-carbon nuclear power.

Second, we need to invest in enough hydrocarbon infrastructure to meet today’s energy needs, while minimising the extent to which such investments hinder a transition over the longer term. In Europe, for example, that will require investing in terminals and storage for liquefied natural gas and pipelines to import more sources of natural gas, as Germany recently announced it would do after abandoning the Nord Stream 2 pipeline project to import more Russian gas. The European Commission will struggle to achieve its goal of getting off Russian fossil fuels entirely before 2030 if it relies solely on existing infrastructure.

The problem is that in the best-case scenario, these investments in oil and gas will become obsolete before many investors can see a reasonable return on their investment. Today’s energy crisis thus throws into sharp relief the need to reconsider governments’ role in energy infrastructure and whether to designate certain projects specifically as “transition assets”. For those, governments might lower the cost of capital and long-term risk in exchange for agreements to wind the assets down sooner than companies typically would. Or it may require that such assets be built, at additional cost, to be “transition friendly”, such as equipped to eliminate methane leaks, ready to be retrofitted for carbon-capture technology, or built to accommodate other low-carbon fuels like hydrogen.

Third, in the messy process of transition to clean energy, we need more, not fewer, tools to mitigate inevitable energy-market volatility. To smooth the jagged path to net-zero carbon emissions, America, the EU and their allies should increase strategic stockpiles; avoid prematurely retiring existing energy assets, such as nuclear power plants; expand programmes to curb consumer usage in periods of peak energy demand; and develop more mechanisms to insulate consumers from periodic extreme energy prices shocks (such as triggers for subsidies to low-income consumers).

As households struggle to pay their energy bills, and Europe attempts to ensure it can keep the heat and lights on next winter if Russian gas flows are slashed, today’s energy crisis should be a wake-up call. We need to ensure adequate supplies of energy, including fossil fuels, to meet today’s needs while dramatically accelerating a transition to clean energy and building new policy tools to facilitate investments that achieve both goals. ■

_______________

Jason Bordoff is co-dean of Columbia University’s Climate School. Meghan O’Sullivan is director of the Geopolitics of Energy Project at Harvard University’s Kennedy School of Government.

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Briefing

• The war in Ukraine: An uncertain outlook

The war in Ukraine

An uncertain outlook across Ukraine

IN GEOPHYSICS, an epicentre is the place on the surface of the Earth closest to the point in its depths where intolerable pressure has triggered an earthquake. In war-torn Ukraine, the Epicentr hypermarket in Zaporyzhzhya is the rallying point in government-held territory closest to the intolerable pressure Russian forces have imposed on Mariupol, some 220km away.

Many of those fleeing the violence—some on foot, some in wheelchairs—have nothing but the shopping centre’s address to guide them. Some make it only to intervening villages. But 2,000-5,000 a day are reaching the hastily organised gathering point, as shocked as the survivors of earthquakes and tsunamis. More shocked, perhaps: the destruction they escaped was not some sudden act of God, but a protracted, deliberate and horribly human assault.

You can sense the arrival of a new convoy before you encounter any of the survivors on board—they carry the smoky smell of the burning city even after days of travel. On arrival they get soup and bread—which they hold to their noses before devouring—fresh clothes and first aid delivered by local volunteers. They fight back tears, not always successfully, as they work out if friends and relatives have managed to escape. They are the lucky ones, they keep saying; the ones who found cars and petrol. They are not still trapped in basements. They are not the old women begging for a lift on the edge of town, money in one hand and icons in the other.

Mariupol, once a city of 400,000, was surrounded by Russian forces from Crimea and Donbas in the first week of the war. It has fared far worse since than the other cities around which the Russians are encamped, in part because of its strategic importance—it is crucial to the establishment of a land bridge from Donbas to Crimea—in part because, unlike Kharkiv or Kyiv in the north, it is entirely encircled.

The Russian forces close to Kyiv have been held at bay for the past two weeks. Kira Rudik, a member of the Ukrainian parliament, says the capital is the “best defended place in Ukraine”. No one in the city now believes that Russian forces have the fighting power needed to take and occupy it. There are even some areas where Ukrainian troops are reported to have pushed back the invaders, though at least some of those reports have turned out not to be true. In Makariv, 50km west of the capital, the Ukrainian authorities claimed the Russians had been “driven back”. When your correspondent tried to visit he found a different situation. Fierce fighting made it impossible to get into the town. The local mayor said the Russians had seized 15% of it at the end of February and had neither advanced or been pushed back since then.

In the centre of Kyiv, however, life is improving. Petrol is no longer rationed, and there is more traffic on main roads than at any time since the invasion began on February 24th. Bread is back on supermarket shelves. Trains enter and leave the city.

But the signs, sounds and horrors of war persist. Every day since around March 14th the capital has been struck by a handful of missiles, with the north-west hit particularly badly. Late in the evening of March 20th a Russian missile pulverised a gym, a shopping centre and an office building, hurling debris for hundreds of metres. According to the Russian Ministry of Defence, which produced a video to support its claim, there were Ukrainian missile launchers in a parking area underneath the gym. If true, their detonation in the blast could explain the force of the explosion.

Oleksiy Arestovych, an adviser to Volodymyr Zelensky, Ukraine’s president, says that of every four incoming missiles one is intercepted, one hits a military target and two hit civilian targets. “I can’t say that in Kyiv they are trying to hit civilians on purpose but a lot of times they miss,” he says, adding that elsewhere residential areas have been knowingly targeted.

Mariupol exemplifies that savagery. On March 10th Russian aircraft started to bomb the city; unlike Kyiv, it has no air defences. Soon a few bombs a day became a few dozen bombs a day. On March 16th Russian missiles fell on a swimming pool, a cinema and a theatre; all three were being used for shelter by civilians. The theatre contained over 1,000 people, according to an eyewitness there the day before; the word “children” was written in large letters on the pavement outside the theatre, but did nothing to prevent the attack. No one currently knows how many survived, nor how many may remain buried alive.

In nine other towns and cities talks between Russia and Ukraine have established humanitarian corridors through which civilians can escape. Such talks have not worked for Mariupol. As things have worsened the escape routes, already dangerous, have become more deadly. Oleksandr Horbachenko, a welder, says that when he left on March 18th the city was in a state of collapse, with no municipal services, no drinkable water and no food. He says at least 80% of buildings are bombed out. “The whole of the centre is in ruins, with wires and glass everywhere. The worst thing is seeing the corpses strewn across the street. There are hundreds of them rotting away near the central market.”

On March 20th a Russian bomb hit a school on the eastern side of the city, where 400 people were reportedly sheltering. Later that day, Russia delivered an ultimatum: surrender the city by 5am the following morning. The Ukrainian government refused. But it has no way of breaking the blockade. On March 19th Mr Arestovych said the nearest available forces were more than 110km away. To reach the city they would have to traverse terrain on which they would be completely exposed to Russian air attacks.

Many interpreted the ultimatum as a warning of worse crimes to come, and fighting intensified in the days that followed; ships are currently adding to the bombardment. The city is close to falling. On March 20th Andriy Biletsky, the founder of the Azov regiment, a paramilitary outfit fighting alongside elite Ukrainian forces from the 36th Marine Brigade, confirmed that street-to-street fighting was under way in the east of the city. With 3,500 Ukrainian soldiers facing 14,000 invaders, around a tenth of the total estimated Russian force in the country, their prospects look daunting, even though attackers are generally reckoned to need a large numerical advantage.

The carnage in Mariupol and the success in Kyiv have both strengthened Ukrainian resolve. But the country continues to pursue negotiations with the invaders. And Russia’s requirements from such talks, though still beyond what Ukraine says it is willing to give, are much more modest now than they would have been when the invasion was launched in expectation of an easy and near total victory. The four principal ones are: a declaration of Ukrainian neutrality; Ukrainian demilitarisation; formal acceptance that Crimea, which Russia seized in 2014, is Russian territory and that the Donbas region, some of which was controlled by separatists backed by Russia before the war, is independent; and relief for Russia from Western sanctions.

Ukraine appears ready to agree to some of these demands. It has stated publicly that it will make no concessions on territorial integrity with regard to Crimea and Donbas, but behind closed doors there appears to be more willingness to experiment with different formulas. However its negotiators see no willingness to move on the other side. “They’re not as confident and self-assured as they used to be in the first days,” Dmytro Kuleba, Ukraine’s foreign minister, said in an interview with The Economist. “But on all big issues they are still where they were [when the negotiations began].”

If there is something Russia clearly wants, it is relief from sanctions. “Almost every tenth sentence [Russian negotiators] say is about sanctions,” Mr Kuleba said. “It’s a pain for them.” As a result Ukraine is pressing its Western supporters to turn up the pressure. A cost the Russians do not talk about is their mounting death toll. According to a NATO estimate, 7,000-15,000 Russians have died; the organisation puts the total number of those dead, injured and captured at around 40,000. If casualties are indeed in that sort of range then almost a quarter of the original invasion force is out of action.

But the Ukrainians are not sure that the Russian negotiators know how bad the situation is. The team is “second tier”, according to an intelligence official in Kyiv; Mr Kuleba says they do not appear empowered to resolve issues such as the nature of the security guarantees Ukraine wants.

Mr Putin’s failure to provide better negotiators could well reflect a lack of interest in seeing the negotiations bear fruit, perhaps because he thinks time is on his side. Though many Russian advances have stalled, there are quite a few places where it could increase its bombardments. A security official in Kyiv says that Ukrainian intelligence has had several warnings that a massive, sustained rocket attack on the capital is imminent. For unknown reasons, no such attack has materialised. But it remains a possibility. And Ukraine does not yet have the resources for decisive counterattacks.

Yet Mr Putin has been wrong about this war before. He may be again. Ms Rudik, the MP, says time is of the essence. She just doesn’t know who it favours. “The Russian economy is collapsing but we are dying. The question is who falls first.” ■

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Reactionary, obscurantist and having a day in the sun

The new Russian cult of war

ON MARCH 22ND, in a penal colony 1,000km north-east of the front lines around Kyiv, Alexei Navalny, the jailed leader of Russia’s opposition, was sentenced to another nine years imprisonment. To serve them he will probably be moved from Vladimir, where he has been kept for more than a year, to a yet harsher maximum-security jail elsewhere.

The crime for which he was sentenced is fraud. His true crime is one of common enterprise with that for which the people of Ukraine are now suffering collective punishment. The Ukrainians want to embrace many, if not all, the values held dear by other European nations. Mr Navalny wants the same for Russia. Vladimir Putin cannot countenance either desire. As Dmytro Kuleba, Ukraine’s foreign minister, told The Economist, “If Russia wins, there will be no Ukraine; if Ukraine wins, there will be a new Russia.” That new Russia is as much a target of Mr Putin’s war as Ukraine is. Its potential must be crushed as surely as Mr Navalny’s.

This crusade against a liberal European future is being fought in the name of Russkiy mir—“the Russian world”, a previously obscure historical term for a Slavic civilisation based on shared ethnicity, religion and heritage. The Putin regime has revived, promulgated and debased this idea into an obscurantist anti-Western mixture of Orthodox dogma, nationalism, conspiracy theory and security-state Stalinism.

The war is the latest and most striking manifestation of this revanchist ideological movement. And it has brought to the fore a dark and mystical component within it, one a bit in love with death. As Andrei Kurilkin, a publisher, puts it, “The substance of the myth is less important than its sacred nature…The legitimacy of the state is now grounded not in its public good, but in a quasi-religious cult.”

The cult was on proud display at Mr Putin’s first public appearance since the invasion—a rally at the Luzhniki stadium packed with 95,000 flag-waving people, mostly young, some bused in, many, presumably, there of their own volition. An open octagonal structure set up in the middle of the stadium served as an altar. Standing at it Mr Putin praised Russia’s army with words from St John’s gospel: “Greater love hath no man than this, that a man lay down his life for his friends.”

His oration, delivered in a $14,000 Loro Piana coat, made much of Fyodor Ushakov, a deeply religious admiral who, in the 18th century, helped win Crimea back from the Ottomans. In 2001 he was canonised by the Orthodox church; he later became the patron saint of nuclear-armed long-distance bombers. “He once said that the storms of war would glorify Russia,” Mr Putin told the crowd. “That is how it was in his time; that is how it is today and will always be!”

A cathedral dome 19.45 metres across

In both his broad appeals to religion and his specific focus on the saintly Ushakov Mr Putin was cleaving to Stalin’s example. After the Soviet Union was attacked by Germany in 1941, the sometime seminarian turned communist dictator rehabilitated and co-opted the previously persecuted Orthodox church as a way of rallying the people. He also created a medal for outstanding service by naval officers called the order of Ushakov and arranged for his remains to be reburied.

This was not a mere echo or emulation; there is a strand of history which leads quite directly from then to now. Links between the church and the security forces, first fostered under Stalin, grew stronger after the fall of Communism. Whereas various western European churches repented and reflected after providing support for Hitler, the Moscow Patriarchate has never repented for its collusion with Stalin in such matters as the repression of Ukrainian Catholics after 1945.

The allegiance of its leaders, if not of all its clergy, has now been transferred to Mr Putin. Kirill, the patriarch of the Russian Orthodox church, has called his presidency “a miracle of God”; he and others have become willing supporters of the cult of war. An early indication of this possibility was seen in 2005, when the orange and black ribbons of the Order of St George, a military saint venerated by the Orthodox church, were given a new pre-eminence in commemorations of the 1941-45 struggle against Germany, known in Russia as the “great patriotic war”. Its garish culmination can be seen in the Main Cathedral of the Russian Armed Forces in Kubinka, 70km west of Moscow, which was inaugurated on June 22nd (the day Hitler launched his invasion) in 2020 (the 75th anniversary of the war’s end) with Mr Putin and Kirill in attendance.

The cathedral is a Byzantine monstrosity in khaki, its floor made from melted-down German tanks. But it is not devoted solely to the wars of the previous century. A mosaic commemorates the invasion of Georgia in 2008, the annexation of Crimea in 2014 and the country’s role in Syria’s civil war: angels smile down on the soldiers going about their holy work.

In keeping with this attitude Kirill has declared the current war a Godly affair and praised the role it will play in keeping Russia safe from the horrors of gay-pride marches. More zealous churchmen have gone further. Elizbar Orlov, a priest in Rostov, a city close to the border with Ukraine, said the Russian army “was cleaning the world of a diabolic infection”.

As the cathedral shows, the Russian people’s sacrifice and victories in the great patriotic war, which saw both the loss of 20m Soviet citizens and the creation of an empire greater in extent than any of the Tsars’, are central to Mr Putin’s new ideology of the Russian world. Today, though, the foes and allies of the 1940s have been shuffled around, allowing the war to be reframed as part of an assault on Russia’s civilisation in which the West has been engaged for centuries. The main culprits in this aggression are Britain and America—no longer remembered as allies in the fight against Nazis, but cast instead as backers of the imaginary Nazis from which Ukraine must be saved.

Project Russia

More important to the cult even than the priests are the siloviki of the security services, from whose ranks Mr Putin himself emerged. Officers of the FSB, one of the successors to the KGB, have been at the heart of Russian politics for 20 years. Like many inhabitants of closed, tightly knit and powerful organisations, they have a tendency to see themselves as members of a secret order with access to revealed truths denied to lesser folk. Anti-Westernism and a siege mentality are central to their beliefs. Mr Putin relies on the briefs with which they supply him, always contained in distinctive red folders, for his information about the world

In this realm, too, a turn towards the ideology now being promulgated was first seen in 2005, when a faction within the FSB produced an anonymous book called “Project Russia”. It was delivered by courier services to various ministries dealing with security and Russia’s relationship with the world, warning them that democracy was a threat and the West an enemy.

Few paid much heed. Though Mr Putin’s ascension to the presidency in 2000 was helped by his willingness to wage war in Chechnya, his mandate was to stabilise an economy still reeling from the debt crisis of 1998 and to consolidate the gains, mostly pocketed by oligarchs, of the first post-Soviet decade. His contract with the Russian people was based not on religion or ideology, but on improving incomes. Only dedicated Kremlin watchers, astute artists such as Vladimir Sorokin and a few political activists paid much attention to the new ideology of isolationism appearing in some of the darker corners of the power structure. At a time of postmodernist irony, glamour and hedonism it seemed marginal at best.

Two years later the new way of thinking became much more obvious to the outside world. In his Munich speech in 2007 Mr Putin formally rejected the idea of Russia’s integration into the West. In the same year he told a press conference in Moscow that nuclear weapons and Orthodox Christianity were the two pillars of Russian society, the one guaranteeing the country’s external security, the other its moral health.

After tens of thousands of middle-class city dwellers marched through Moscow and St Petersburg in 2011-12 demanding “Russia without Putin” the securocrats and clerics started to expand their dogma into daily life. A regime which sustained, and was sustained by, networks of corruption, rent extraction and extortion required religion and an ideology of national greatness to restore the legitimacy lost during the looting. As Mr Navalny remarked in a video which revealed Mr Putin’s palace in Sochi, covering up things of such size requires a lot of ideology.

Broken destinies

At that point it was still possible to see the ideology as a smokescreen rather than a product of real belief. Perhaps that was a mistake; perhaps the underlying reality changed. Either way, the onset of the covid-19 pandemic two years ago brought a raising of the ideological stakes. At the time, the most discussed aspect of the constitutional changes that Mr Putin finagled in July 2020 was that they effectively removed all limits on his term in office. But they also installed new ideological norms: gay marriage was banned, Russian enshrined as the “language of the state-forming people” and God given an official place in the nation’s heritage.

Mr Putin’s long subsequent periods of isolation seem to have firmed up the transformation. He is said to have lost much of his interest in current affairs and become preoccupied instead with history, paying particular heed to figures like Konstantin Leontyev, an ultra-reactionary 19th-century visionary who admired hierarchy and monarchy, cringed at democratic uniformity and believed in the freezing of time. One of the few people he appears to have spent time with is Yuri Kovalchuk, a close friend who controls a vast media group. According to Russian journalists they discussed Mr Putin’s mission to restore unity between Russia and Ukraine.

Hence a war against Ukraine which is also a war against Russia’s future—or at least the future as it has been conceived of by Russia’s sometimes small but frequently dominant Westernising faction for the past 350 years. As in Ukraine, the war is intended to wipe out the possibility of any future that looks towards Europe and some form of liberating modernity. In Ukraine there would be no coherent future left in its place. In Russia the modernisers would leave as their already diminished world was replaced by something fiercely reactionary and inward looking.

The Russian-backed “republics” in Donetsk and Luhansk may be a model. There, crooks and thugs were elevated to unaccustomed status, armed with new weapons and fitted with allegedly glorious purpose: to fight against Ukraine’s European dream. In Russia they would be tasked with keeping any such dream from returning, whether from abroad, or from a cell. ■

Read more of our recent coverage of the Ukraine crisis

United States

• Great-power politics: Ukraine and the lessons of the cold war

Great-power politics

In Ukraine, Biden must relearn Truman’s lessons from the cold war

JOE BIDEN entered the White House last year styling himself on Franklin Roosevelt. The better model today might be Harry Truman. His words to Congress 75 years ago this month—“It must be the policy of the United States to support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures”—girded America for the cold war. Those words have a new resonance as Ukraine, helped by the West, battles to resist Russia’s month-old invasion.

As in the 1940s and 50s, the world is separating into distinct blocs. The Eurasian giants, Russia and China, are again making common cause. America is seeking to counter them by mustering allies around their periphery, from Europe to Japan. Truman’s America was engaged in a fight against communism; Mr Biden sees a global contest against autocracy. The cold-war strategy of “containment” is being studied for the current age.

This arouses dread, but also hope. Dread, because of the return of war in Europe, renewed big-power confrontation and the increased risk of nuclear conflict. Hope, because Russia’s military incompetence, Ukraine’s valour and the West’s newfound unity raise confidence that the American-led liberal order can prevail. Writing in American Purpose, an online magazine, Francis Fukuyama of Stanford University, who in an earlier bout of optimism coined the notion of the “end of history” about the demise of the Soviet Union, goes so far as to predict that Ukraine will inflict “outright defeat” on Russia and make possible a “new birth of freedom”.

Mr Biden’s strategy will become clearer in the coming days. On March 24th he was due to take part in a trio of summits in Brussels with the leaders of NATO, the European Union and the G7. The signs are he will steel the allies for a long struggle. “This war will not end easily or rapidly,” said Jake Sullivan, his national security adviser, on March 22nd. The West would stand by Ukraine “for as long as it takes”.

Another signal will be the president’s request for more defence spending in the coming financial year, expected to be sent to Congress next week. A succession of formal strategy documents—for national security, defence and nuclear posture—will follow after hurried redrafting. For Robert Gates, a former American defence secretary, the war “has ended Americans’ 30-year holiday from history”. Ahead lies a two-front contest, against both Russia and China. “A new American strategy must recognise that we face a global struggle of indeterminate duration against two great powers that share authoritarianism at home and hostility to the United States,” he wrote in the Washington Post.

Strategists are reaching for the annals of the cold war. Is Vladimir Putin’s invasion akin to the Soviet Union’s blockade of Berlin in 1948, the start of the Korean war in 1950 or the Cuban missile crisis of 1962? Some are re-reading George Kennan, the American diplomat whose “long telegram” from Moscow in 1946 set the intellectual foundation for containment. American “unalterable counterforce”, Kennan argued in a later essay, could hasten “either the break-up or the gradual mellowing of Soviet power”. In practice containment involved more than the high-minded means Kennan imagined, such as the Marshall plan to rebuild Europe. It also involved coercive instruments: military alliances and build-ups, nuclear standoffs, proxy wars and much else short of a direct conflict.

Dean Acheson, Truman’s secretary of state, wrote that America’s task after 1945 was “just a bit less formidable than that described in the first chapter of Genesis. That was to create a world out of chaos; ours, to create half a world, a free half, out of the same material without blowing the whole to pieces in the process.”

Mr Biden’s burden is to prevent the world from reverting to chaos, and to preserve as much of the free portion as possible. Russia today may be a lesser foe than the Soviet Union, “a wounded empire” rather than a superpower with a global ideology and a semi-autarkic economic hinterland, as Eliot Cohen of Johns Hopkins University notes. Yet China is a greater challenger, not least in economic terms. Its navy is already larger than America’s, and it is fast expanding its nuclear arsenal.

To judge Mr Biden, then, consider three measures: first, how he deals with Russia; in the longer term, how he confronts China; and, throughout, how he carries his profoundly polarised country.

Vladimir the terrible

Team Biden had no illusions about Russia. Its early warning about the invasion of Ukraine, and its release of intelligence about the Kremlin’s plans, were innovative and prescient. It denied Mr Putin a pretext, and primed allies to respond forcefully, both by arming Ukraine and by imposing severe sanctions on Russia. Like Mr Putin, however, Mr Biden may have underestimated Ukraine. On the eve of war America seemed to think that, at best, Ukraine might become another Iraq or Afghanistan, easy to invade but hard to control. Instead Russia has found it surprisingly arduous to take Ukraine’s cities, even as it pulverises them. The longer the horrors go on, the greater the cries for the world to stop them.

At their summits in Europe, the Western allies will resolve to strengthen NATO’s defences, provide more weapons to Ukraine and increase economic pressure on Russia. Above all, American officials say, they will stiffen their sinews for a long contest as economic pain spreads.

How far dare the allies go in waging a proxy war against a nuclear power? The answer keeps shifting. In 2014, when Russia took a first chunk of Ukraine, America declined to provide weapons. It later began to deliver anti-tank missiles. Now it is shipping small anti-aircraft weapons and drones. Soon it may facilitate the supply of longer-range air-defence missiles.

Yet there are limits. When Mr Biden vows that America will defend “every inch” of NATO’s territory he declares, in effect, that American forces will not defend any inch of Ukraine’s. To get involved directly, says Mr Biden, would be “World War III”. He has refused calls to impose a no-fly zone over Ukraine, act as the intermediary for Polish MiG-29 jets or even supply American-made Patriot anti-aircraft batteries.

The point at which America becomes a “co-combatant” will not be decided by lawyers but, ultimately, by Russia. The Kremlin has given notice that arms convoys to Ukraine would be legitimate targets. It has bombed sites close to Poland.

History suggests the boundaries of proxy conflicts can be dangerously fuzzy. Chinese “volunteer” forces fought against American troops in the Korean war of 1950-53, when America considered using atom bombs against them. Russians manned anti-aircraft batteries and, perhaps, flew missions against American aircraft in the Vietnam war of 1955-75.

“During the cold war the United States and the Soviet Union were at daggers drawn but usually did not stab each other directly,” explains Richard Fontaine of the Centre for a New American Security, a think-tank in Washington. Mr Putin has rattled his nuclear sabre, but American officials say they have detected no change in Russia’s nuclear posture, nor have they changed theirs.

Mr Biden’s caution in Ukraine contrasts with his almost careless talk about defending Taiwan against China. Last year Mr Biden said America had a “commitment” to defend the island. America’s “strategic ambiguity”, whereby it promises to help Taiwan defend itself but will not say whether it would intervene directly, has become less ambiguous.

Nobody can say quite why America seems readier to risk “World War III” for Taiwan than for Ukraine. Perhaps the danger in Ukraine is concentrating minds. Some note that America has no alliance with Ukraine, a non-NATO country, whereas it has a semi-obligation to Taiwan. The island’s important semiconductor industry is a consideration. The main reason is that America considers China, not Russia, to be the greatest danger.

“Russia is the acute threat. But China is the pacing challenge, the only country able to challenge the United States systemically,” says a senior American official. “Nothing about the crisis in Ukraine has changed that.” Or, as one diplomat puts it, “Ukraine is the tsunami; China is climate change.” America’s response in Europe contributes to alliance-building, says the envoy; it will expect Europeans to help in Asia.

The fact that Australia, Japan and other Asian countries have imposed sanctions on Russia is a sign of their fears about the war’s wider repercussions. American military chiefs have warned that a Chinese invasion of Taiwan could happen before the end of the decade. A successful Russian attack on Ukraine might have emboldened China. Now that Russia is bogged down, the danger may have receded.

Russia and China have declared that their friendship has “no limits”. America is hoping that Xi Jinping, China’s leader, will now have second thoughts. In a video summit on March 18th Mr Biden issued a threat to impose sanctions on China if it came to Russia’s aid. One aim of Mr Biden’s trip this week is to push Europeans to deliver the same message at the EU-China summit on April 1st. China maintains the fiction that it is neutral, so could in theory distance itself from Russia. Few in Washington think Mr Xi is prepared to let Mr Putin fail. But America now sees “an opportunity to deal a strategic blow to Russia, and an opportunity to make Russia increasingly a strategic burden for China,” the official says.

Home alone

On the home front, foreign-policy types give Mr Biden high marks for his handling of the crisis. Opinion polls suggest his actions are in line with the public’s views: support Ukraine and impose sanctions on Russia, but don’t send American troops or shoot down Russian planes.

Yet Mr Biden is not enjoying much of a “rally round the flag” bounce. A YouGov poll for The Economist, conducted on March 19th-22nd, found that 41% of those surveyed approved of his foreign policy, whereas 49% disapproved. Asked about his ability to handle an international crisis, just 33% said they were confident and 48% were uneasy. Such views are highly skewed by party affiliation. Plainly, Mr Biden has failed to restore confidence after his chaotic withdrawal from Afghanistan.

A moment of bipartisanship over Ukraine is dissipating. Republicans accuse Mr Biden of being “weak”. Some advocate a no-fly zone. Most say Mr Biden should not have blocked the delivery of MiG-29s to Ukraine. Much of this criticism looks like posturing. In what promises to be a long global struggle, America’s extreme polarisation will be an enduring vulnerability.

The left wing of the Democratic Party has long wanted to shrink the defence budget to make room for ambitious social spending. Mr Biden has favoured continuity, and accepted a nominal increase in the current fiscal year. He may have to change his priorities. Defence spending, now some 3.3% of GDP, is close to its post-war low—down from a high of 13.8% during the Korean war and an average of 7.2% during the cold war (see chart).

Hal Brands, author of a book about the lessons of the cold war, argues that the figure should increase to about 5% of GDP to enable America to cope with trouble in both Europe and Asia. “One parallel between Harry Truman and Joe Biden is that both dramatically under-resourced defence in the early part of their presidencies. The question is whether the Ukraine war will play the role that the Korean war did in convincing the country to increase defence spending.”

The gruelling Korean war did much to destroy Truman’s presidency. That is a lesson in the need for caution. But even if Mr Biden shows skill and sound judgment in the new cold war, he, like Truman, may not get much credit for it until decades later. ■

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Madeleine Albright

America’s first female secretary of state has died of cancer, aged 84

MADELEINE ALBRIGHT, who died in Washington, DC, on March 23rd, served under Bill Clinton as UN ambassador before becoming America’s first woman secretary of state. She recalled America’s failure to stop the Rwandan genocide as her greatest regret. NATO’s eastward expansion was among her successes—and personal, given her history. Born in Prague in 1937, with her family she fled Nazism, then communism. Mrs Albright had thought that her family was Catholic. Only after she was secretary of state did she learn that she was born Jewish and lost three of her grandparents in the Holocaust.■

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Symbols in sports

The debate about Native American-themed team names goes local

WHAT DO GUARDIANS and Commanders have in common? Both project enough moxie for sports fans to rally behind, and neither is offensive. The Commanders are the former Washington Redskins, an American-football team; the Guardians are the baseball team once known as the Cleveland Indians. They are the latest examples of the scrubbing of Native American imagery from organised sports. In a video voiced by Tom Hanks, the Cleveland name change is portrayed as the forward march of history, from racism towards justice. For some Native Americans, it’s not that simple.

Brenda Bremner, former general manager of the Confederated Tribes of Siletz Indians, has a closet full of Warriors and Braves shirts. Her parents met at the Chemawa Indian School in Salem, Oregon, and her father played for the Chemawa Braves. “We wore Indian-type logos proudly,” she says. In 2017 it became illegal for Oregon public schools to have Native American mascots, logos or team names, but an exception—petitioned for by Ms Bremner—allowed schools to retain their mascots by entering into agreements with local tribes. Eight school districts did so.

A similar law is now in the Massachusetts Senate, and the town of Dartmouth is wondering what to do with its high-school team, the Indians. Is the Indian logo racist (causing “shame, horror and harm”, as critics said at a school-committee meeting this week)? A non-binding referendum is scheduled for April 5th.

The Pocasset Wampanoag Tribe, which was living in this area when the pilgrims landed in 1620, is divided on the issue. The Mashpee Wampanoag Tribe opposes the Dartmouth Indian logo. But 22 members of the Aquinnah Wampanoag Tribe signed a letter defending it. The image was drawn by a tribal member. “The symbol is not disrespectful,” the Aquinnah’s Sean Carney said at a previous school-committee meeting, on March 8th. In a separate letter, the Aquinnah chairwoman said the ban attempts to eliminate Native people from “today’s culture and society”.

Mr Carney has no love for the Redskins or for Chief Wahoo, the cartoonish mascot of the Cleveland Indians. The damaging effects of this kind of imagery on students have been well documented, which is why Maine banned such mascots in 2019, and why a new Colorado law will fine any public school with an unacceptable Native-themed team name or logo $25,000 a month from June. But the Dartmouth Indian is not Chief Wahoo.

Statewide bans are a crude instrument. What many tribes want above all is meaningful consultation on decisions ostensibly made in their name. The local approach has worked. Athletes at the University of Utah continue to call themselves Utes, with the approval of the real Utes, in exchange for lesson plans and scholarships for tribal members. It is similar with Florida State University’s Seminoles. Prejudice is the problem, says Ms Bremner, “and you don’t get rid of prejudice without education”.

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Drug pricing

A new drug for Alzheimer’s is struggling to justify its price

JAY REINSTEIN remembers where he was when he heard that the Food and Drug Administration (FDA) had approved Aduhelm (aducanumab), a new Alzheimer’s drug. It was last June, and he was at Kohl’s, a department store, when he started getting news alerts on his phone. He asked a stranger outside the shop to take a picture of him jumping into the air, which he promptly posted on Facebook to share the news with family and friends. “It was an awesome feeling because it really felt like there was hope for me and so many others,” he says. “I remember going home, and my wife was crying.”

After being diagnosed with Alzheimer’s disease four years ago at the age of 56, Mr Reinstein thought the wait for treatment was finally over. “I was all ready to roll,” he recalls. Alzheimer’s is a brutal and relentless degenerative disease that gradually robs patients of their memories—and devastates families. But in January the Centres for Medicare & Medicaid Services (CMS) proposed that only patients who are enrolled in clinical trials would have their drug costs covered. If the CMS confirms this decision in April, it will greatly limit who can have the drug.

Despite Aduhelm being billed as the first treatment to modify the course of Alzheimer’s, payers of all kinds have been cool on the drug. Weak evidence of efficacy, problematic side-effects and a sky-high price are all to blame. The drug has also had a chequered history. In early 2019 Biogen, the biotech firm behind it, halted its development, saying that it did not work. Months later, the firm did a U-turn and said a new analysis showed that the drug did work after all.

Scientists disapproved of the way the data had been reanalysed. And sceptics pointed out the massive financial gains approval would bring the company. A scientific advisory panel to the FDA said the drug should not be approved. But the agency overruled its committee.

To complicate matters further, the firm then slapped a price of $56,000 a year on the drug. The Institute for Clinical and Economic Review calculates the drug should be priced at somewhere between $3,000 and $8,400 a year if it works (something that has not been proved). Although the list price has since been cut to $28,200 a year, so far payers have been extremely reluctant to meet it. Many private health insurers have said they want more proof of efficacy before paying for it, and there are concerns about adverse effects such as brain swelling and bleeding.

Biogen badly needs the government to buy the drug. It emerged recently that the struggling company is cutting about 1,000 jobs (more than 10% of its workforce). In January, during a call with investors, Biogen’s boss, Michel Vounatsos, pressed Aduhelm’s supporters to fight the CMS’s decision. And UsAgainstAlzheimer’s, an advocacy group that receives funding from Biogen, recently launched a large advertising campaign with the aim of swaying the final decision.

“When we got the CMS’s decision, we were really sort of shocked. I used a lot of curse words,” Mr Reinstein says. Like most patients, he cannot afford to pay for the drug out of his own pocket. Patients argue that the CMS has overstepped its authority by denying coverage for an FDA-approved drug. Some also worry that the decision will restrict the market for other drugs in development that work in the same way but might prove to be more effective.

Patients argue that Aduhelm is far cheaper than costly cancer or gene therapies. However, the prevalence of Alzheimer’s, which afflicts 6m people in America, means that the use of such an expensive drug on a yearly basis will quickly become unaffordable. One study calculated that if 1m patients were to be given Aduhelm, the annual cost would be $73bn by 2028. Although Biogen has cut its price since this analysis was done, broad use of this drug presents a profound challenge to Medicaid and Medicare.

While the arguments continue, those who are missing out on the treatment worry that it may become too late for them to benefit from the drug. “I’m 60. I want to spend time with my grandkids and my family,” explains Mr Reinstein. “And the more they delay, the more time that this [disease] can progress. I’m the perfect candidate for this. You wait another two years, I may not be.” ■

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The United States of Amazon

What happens when Amazon comes to town

FOR NEARLY a century Birmingham, Alabama, was synonymous with steel. The suburb of Bessemer was named after Henry Bessemer, a British inventor who transformed steelmaking. Workers moved from as far away as southern Europe to toil in the Birmingham area’s mines and factories, says Henry McKiven, a historian at the University of South Alabama.

The steel industry around Birmingham shrank as manufacturing moved overseas. Bessemer’s unemployment rate reached 35% in the early 1980s. Another vestige of steelmaking disappeared from Bessemer in 2018 when US Steel sold its land to Amazon, which had chosen the town as the site for its first warehouse in Alabama. The sale symbolised Bessemer’s metamorphosis from industrial powerhouse to wannabe logistics hub, a transformation that is being mirrored in cities across America.

Amazon’s business depends on getting goods to consumers fast, which means opening fulfilment centres—as it calls its huge warehouses—near big population areas. MWPVL, a Canadian consultancy, reckons Amazon will have opened about 400 of these in America by 2024 (see top chart). As well as warehouses, it is opening sorting centres and delivery stations—the last stop before a customer’s doorstep. The company is now America’s second-biggest private employer, after Walmart. At the end of 2021 it had 1.1m “Amazonians” working in the country, and plans to hire at least 125,000 more.

Amazon’s relentless expansion is not just revolutionising shopping. It is also affecting towns, such as Bessemer, that wooed it in the hope of revitalising their economies. Many cities that were snubbed in the frenetic competition to become Amazon’s second headquarters (after Seattle) were brought into the firm’s orbit anyway as a regional tech hub, such as Phoenix and Nashville, or as a home for a fulfilment centre. Holly Sullivan, Amazon’s vice-president for economic development, says that when picking a warehouse site her team considers factors such as transport infrastructure, workforce and availability of industrial land. Bessemer ticked the boxes.

But what happens once Amazon arrives? It can change a place in several ways. Start with wages. Warehouse workers in counties where Amazon operates made about $41,000 a year in 2017, 10% less than those in counties without Amazon. When Amazon instituted a $15 minimum wage in 2018, workers’ fortunes rose, but not faster than for warehouse workers as a whole (see bottom chart). Amazon says this is not a fair comparison. Workers elsewhere may belong to unions or be trained to use equipment such as forklifts, boosting their pay. Most workers in Amazon’s fulfilment centres, the firm says, are younger and come without any training, often after being unemployed. Employing these workers may depress average wages in the industry, but boost earnings across the economy as a whole.

The effects of Amazon’s wage floor were felt beyond its own workforce. A paper published in 2021 by Ellora Derenoncourt, now of Princeton University, and colleagues found that a 10% increase in Amazon’s average hourly wages led other companies in the same region to raise wages by an average of 2.3%. Walmart, Target and Costco caused similar spillover effects.

A forthcoming study by Vikram Pathania and Serguei Netessine, economists at Amazon who have posts at the University of Sussex and the University of Pennsylvania respectively, found that Amazon’s presence boosts a county’s economy. Comparing counties with Amazon warehouses with similar counties without them, the researchers found that in the first three years after opening a fulfilment centre jobs were created beyond Amazon’s hires, poverty declined and household income rose.

It is no surprise that a study co-produced with Amazon highlights such benefits. Still, logistics experts and local officials in Alabama describe a positive “Amazon effect”. Marc Wulfraat, the president of MWPVL, says logistics firms tend to cluster: if Amazon picks a town because of its highways and workers, it may make sense for parcel carriers such as FedEx to be there.

Amazon was not the first big firm to come to Bessemer. Dollar General opened a distribution centre there in 2011. But netting Amazon is “a Good-Housekeeping seal of approval”, says Ron Kitchens, until recently boss of the Birmingham Business Alliance. “If you get Amazon, others are coming.” Kenneth Gulley, the mayor of Bessemer, saw wooing Amazon as a way to buck the trend of small-town decline. Bessemer’s poverty rate is still around 26%, much higher than the state average of 15%.

Signed, sealed, delivered

The process of persuading Amazon to choose one town over another comes with its own costs, however. Good Jobs First, an economic-development watchdog, estimates that Amazon has been given at least $4.2bn in subsidies from state and local governments for its facilities. Critics of such incentives suggest that towns are doling out subsidies to Amazon when it would settle there anyway to serve its customers quickly. Timothy Bartik, of the W.E. Upjohn Institute for Employment Research in Kalamazoo, Michigan, reviewed 30 studies of incentives in 2018, and found that at least 75% of firms analysed would have made a similar decision without a subsidy.

That does little to deter local officials. “You’re competing not only with cities in other states, you’re competing with cities right here in the state of Alabama,” says Mr Gulley. “You’re going to have to incentivise or you’re not going to be able to secure the companies.” Even if Amazon had chosen another town near Birmingham for its fulfilment centre, Bessemer probably would have benefited. The warehouse employs about 6,000 people—more jobs than Bessemer’s 26,000 residents could fill alone.

Workers in Bessemer complain that Amazon’s focus on efficiency and its use of performance-tracking algorithms feel like surveillance, and that bathroom breaks are too short and security checks onerous. Injuries at fulfilment centres are more common than at other warehouses and employee turnover is high. In his book “Fulfilment”, Alec MacGillis, a journalist, relates several stories of Amazon employees hurt on the warehouse floor, fired for encouraging unionisation or, simply, unfulfilled by the work of picking and packing orders.

Last year discontent in Bessemer led to a union drive. It failed, but the National Labour Relations Board said Amazon had pressed workers into opposing the union, and ordered a new election. Votes will be tallied on March 28th, two days before Amazon workers at a Staten Island warehouse in New York finish their own union drive.

Around Bessemer, red posters in residents’ front yards shout “Vote union yes!” and “This home supports Amazon workers”. Jennifer Bates, one of the leaders of the union drive and a native Alabamian, doesn’t think Bessemer has changed much since Amazon arrived, but she does have one observation: “The only thing I see is more businesses coming.” ■

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Lexington

American energy innovation’s big moment

T HE OPPORTUNITY to make the covid-19 recovery green has been squandered. A new analysis of over $14trn in pandemic stimulus, injected by 19 countries and the European Union, finds that just 6% went on programmes likely to cut emissions. America did particularly badly: hardly any of its $6trn splurge was climate-friendly. Perhaps the best that can be said for the catastrophe in Ukraine is that the ensuing energy crisis has provided an opportunity to reverse that failure.

The early responses, it is true, have been somewhat discouraging. As European countries cast around for substitutes for Russian oil and gas, short-term fixes are the need of the hour, leading to a higher oil price and probably more oil and gas production. Joe Biden’s administration, which branded itself the greenest ever, is urging producers to drill, baby, drill. Its signature climate policy is meanwhile snarled up in Congress. Mr Biden said as much about diabetes as climate change in his recent state-of-the-union message. Yet there is also cause for hope—in America especially.

Its clean-tech sector is in ferment. The administration used one of the world’s biggest energy confabs, held in Houston this month, to broadcast its plea for more hydrocarbons. Less publicised, notes Daniel Yergin, an energy guru and one of CERAWeek’s organisers, was the fact that the summit’s energy-innovation section drew bigger crowds than the main event. Clean tech attracted over $87bn of investment from venture-capital and private-equity firms alone in the year to June 2021. And there is little expectation, even as interest rates rise, of the boom petering out. It is being driven by three forces that seem likelier to grow: society’s fear of climate change, long-term corporate commitments to decarbonisation, and the underappreciated impact of shrewd legislation.

The last includes the bipartisan Energy Policy Act of 2020, which hugely expanded the Department of Energy’s role in research and development, and the infrastructure law of 2021, which amplified that effort. The climate components of the stalled Build Back Better bill are better known and indeed essential to Mr Biden’s time frame for decarbonising the economy. Yet they are largely dedicated to accelerating the deployment of mature technologies such as solar and wind energy. The two earlier laws were focused more on developing the breakthrough technologies on which most of the world’s decarbonisation effort will depend.

The Department of Energy, hitherto best known for looking after the country’s nuclear weapons, has been restructured for the task. One of its under-secretaries has been dedicated to innovation. Among its new clean-tech programmes are three climate “Earth-shots”—the first in what looks like a promising series. One aims to reduce the production cost of hydrogen by 80% in a decade; another to cut the cost of grid storage by 90%; and a third to develop affordable ways to suck carbon from the atmosphere.

Scepticism is warranted about how far such efforts will go. The department’s network of 17 national labs has always been excellent. Yet America’s record in commercialising their inventions is abject. Having invented photovoltaic cells, America left it to Japan, Germany and then China—where over 70% of panels are now made—to bring them to market. Having poured public money into electric vehicles, notably after the oil shock of 1973, it let Japanese, Chinese and European firms commercialise them.

The problem, suggests Nikos Tsafos of the Centre for Strategic and International Studies, is that whereas politicians share an almost ideological belief in America’s genius for innovation, those on the right, especially, struggle to understand that it involves deployment as well as invention. To deploy clean tech rapidly requires two things that America still mostly lacks. One is a national climate policy to raise the cost of pollution, thereby creating demand. The other is an industrial policy sufficient to boost supply.

The optimistic case for the energy crisis is that it could help deal with both these shortages. It is already boosting European demand for American clean tech. And it might conceivably persuade Congress to expend more political and public capital on accelerating America’s ability to meet that demand: most pressingly by passing the climate portions of Build Back Better; and by thinking more creatively about industrial policy in the bills that members of both parties are drafting.

In eastern Europe, fear of Vladimir Putin had recast the energy transition as a geopolitical imperative even before he invaded Ukraine. Poland and Romania are among the countries keenest on small modular nuclear power stations, an unproven technology, in which American companies are experimenting. The war has made its promise of faster, cheaper, safer nuclear energy seem more attractive—and the existing nuclear-tech leaders, Russia and China, less appealing. Even as Germany and others make hurried plans to invest in new fossil-fuel infrastructure, moreover, they are promising to adapt it to non-fossil alternatives. In committing to build two new LNG import terminals, for example, Olaf Scholz, Germany’s chancellor, suggested they would later be converted to green hydrogen, another potential American strength.

Having exhausted all the alternatives…

This represents a clear opportunity to connect the world’s most advanced clean tech with the continent with the most advanced climate policies. The Biden administration claims to be seized by it. “The whole government now wants to accelerate the energy transition on the basis of energy security, as well as climate,” says one of its senior members. “Even foreign-policy experts, who generally don’t talk about climate change, are obsessed with this.”

The question is whether at least a little of the spirit will arise in Congress. Don’t hold your breath. But don’t count it out, either. The politics of national security, supply chains, energy and climate are in flux, deeply interconnected and capable of inspiring surprising coalitions even there. ■

Read more from Lexington, our columnist on American politics:
The embarrassing Mrs Thomas (Mar 19th)
Joe Biden’s indispensable leadership (Mar 12th)
The end of the Putin delusion (Mar 5th)

For more coverage of climate change, register for The Climate Issue, our fortnightly newsletter, or visit our climate-change hub

The Americas

• Guyana: Invest or squander?

Invest or squander?

Guyana’s tiny population braces for a gusher of petrodollars

IT USED TO be a disused sawmill surrounded by fields of sugar cane. But since oil was discovered off Guyana’s coast in 2015 the 52-hectare site in Georgetown, the capital, has been transformed into the biggest logistics hub in the country. From this waterfront spot, Guyana Shore Base serves ExxonMobil, an American oil giant, and other foreign firms drilling for oil off the Caribbean coast. At two big berths along the Demerara river ships pull up to offload equipment for maintenance and pick up supplies for hundreds of workers toiling away on offshore rigs.

The buzz at the shore base hints at how a rush of petrodollars could transform one of South America’s poorest countries. Autarkic policies introduced under socialist rule in the 1970s left Guyana struggling with unsustainable debts and sluggish growth. Many of the country’s 800,000 people make ends meet doing the same things their grandparents did: farming rice, chopping timber or mining gold.

But since the discovery of light, sweet crude in its waters, Guyana’s fortunes have begun to turn. The country has received a surge of foreign investment and built a sovereign-wealth fund to store its share of the oil money. As a result, it was the world’s fastest-growing economy during the covid-19 pandemic. Now it stands to gain as the war in Ukraine sends oil prices soaring past $100 per barrel and countries that rely on Russian fuel scramble for alternatives.

I’ll oil wells need you

The rising price of oil comes at an important moment for Guyana. The government could get its hands on the oil money for the first time in the coming weeks: it can withdraw a total of $600m from the sovereign-wealth fund this year. But it is unclear how the bonanza will affect the country. Will a sudden injection of petrodollars boost much-needed infrastructure and pull thousands out of poverty? Or will it be squandered or stolen?

ExxonMobil has found over 10bn barrels of recoverable resources in Guyana. Exploration could soon begin in other areas of the seabed. Even if all the new wells turn out to be dry holes, more than 1m barrels of oil per day will be gushing out of Guyanese seas by the end of the decade, says Schreiner Parker of Rystad Energy, a consultancy. That would make it one of the world’s largest offshore producers. Relative to its population, its output will be colossal. Whereas Saudi Arabia pumps less than a third of a barrel, per person, per day, Guyana could be pumping nearly four times that by the end of the decade. The speed at which production has started is “unprecedented”, says Alistair Routledge, president of ExxonMobil Guyana.

Oil has already boosted Guyana’s tiny economy. Multinationals are setting up shop. Local workers are making money driving taxis, working as waiters or toiling on building sites. The economy grew 20% last year and 44% in 2020 (see chart). The current-account balance, which reflects whether a country is a net borrower or lender to the rest of the world, is expected to turn positive this year.

The government is talking big about channelling petrodollars into development. The latest budget, announced in January, promised to raise government spending 44% this year. There are plans to build roads, schools and hospitals. With a new pipeline and 300MW power plant, Guyana could use the gas produced offshore to reduce the cost of electricity and jumpstart manufacturing. New call centres promise to create jobs in the region’s only English-speaking country.

However, Guyanese people need not look far to see how things could go wrong. To the west is Venezuela, where oil has bankrolled a corrupt socialist dictatorship that has impoverished its people. (Indeed, oil exploration in Guyana was delayed for years by a territorial dispute with Venezuela, and anxious types still mutter that its despot might one day try to invade.) To the north, in Trinidad & Tobago, an oil boom brought social discontent and crime. Indeed studies show that, if a country has strong institutions, oil can foster growth, as in Norway and Canada. But a “resource curse” often blights countries with weak institutions, where rent-seekers gobble up the proceeds.

Ashni Singh, Guyana’s finance minister, talks about economic “diversification”. But there is no doubt the country is growing dependent on one industry. By the government’s own estimates, the economy will expand 48% this year. Take out oil, and it will grow by less than 8%.

It is far from clear how much of the oil money will reach ordinary people. Offshore oil rigs do not hire many workers. The drilling happens thousands of metres underwater; machines do most of it. The small number of maintenance staff on the oil platforms need special training. ExxonMobil employs just over 180 people in the country. The company reckons its operations have created jobs indirectly for about 6,000 more. About 60% of them are Guyanese. But not many Guyanese have the skills needed to run an offshore oil operation safely. High-skilled workers are being brought in from other oil-producing countries instead.

Local firms are not winning many big contracts. Only a few companies in the world can produce the pipes or widgets used on high-tech oil platforms. New rules pushed through parliament in December require energy companies to buy certain basic goods and services from Guyanese businesses, such as laundry and catering. But it is an uphill struggle. Multinational oil companies require internationally recognised quality and safety certifications, which few local firms have. ExxonMobil says it spent $220m with local suppliers last year—a large sum relative to Guyana’s GDP, which in 2021 was $6bn. But it is small relative to the company’s overall expenditure on the project in the period, which Rystad Energy reckons was over $900m.

Meanwhile the economy may be overheating. Georgetown Chamber of Commerce and Industry, a business lobby, says local firms are losing their best workers to the oil industry and struggling to get hold of basic goods, like sand for construction. Global supply-chain problems and geopolitical instability have not helped. Consumer prices in Georgetown rose 1.5% in January alone, taking annual inflation to 5.8%, its highest in 20 years.

Perhaps the biggest risk is corruption. The two largest ethnic groups in Guyana are those of African and Indian descent. They do not trust each other much. Successive governments, under the largely Indo-Guyanese People’s Progressive Party and the Afro-Guyanese People’s National Congress Reform, have favoured their own. Cronyism is rife. Local businessmen complain it is only those with friends in high places who win big deals and top jobs in the oil industry. (Presumably this is not true of jobs requiring technical skills that are hard to fake.) Analysts worry there is little transparency surrounding the sovereign-wealth fund, the rules that dictate how much the government can withdraw and where the money is spent. In February Vice News, a website, accused the vice-president of accepting kickbacks from Chinese businessmen. He denies this.

Outside the capital some remain sceptical of black gold’s potential. Gary Grant, the 55-year-old estate manager at the Pomeroon Trading coconut farm, has been alive almost exactly as long as Guyana has been independent, and seen ethnic and political divisions repeatedly hold his country back. He is enraged by rising inflation and glaring inequality. “When Guyana found oil I was optimistic,” he says. “But I’m not so optimistic any more.” ■

Bowling maidens over

Why cricket is gaining popularity in Brazil

A SPA TOWN in the foothills of coffee country may not be the likeliest place to find a cricket revolution. But at a crumbling country club in Poços de Caldas, a city of 170,000 people, the Brazilian national team is in full swing. Funk music blasts as women in brightly coloured shirts spin balls into nets. They stop only to laugh, to check on a teammate’s baby and, when the clouds start to swell, to duck out of the summer rains. It is a far cry from the kind of cricket first played in Brazil in the 1850s. Then it was the pastime of British railway workers. Today it is for Brazilians.

Brazil’s embrace of cricket began two decades ago, when Matt Featherstone, a club player from Britain, noticed that there was a street version of cricket called taco. He began swapping bottles for stumps, and encouraging kids to bowl overarm not under. By 2009 it had become a regular programme under the banner of Cricket Brasil, which is partly funded by the International Cricket Council.

It was not an instant hit. “I’m not going to play that shit,” was Renata de Sousa’s response when invited to play as a teenager. But the camaraderie of the game won her and others over. Today a scholarship scheme puts the best players through university and into coaching. There are teams for the blind and disabled. In Poços more children now hit balls with bats than boots, with over 5,000 playing in total.

This is remarkable not only because they are playing cricket, but because they are playing anything at all. Brazil may be known the world over for football and beach bodies, but a lot of Brazilians are conspicuously unsporty. In a recent survey of exercise habits, Brazilians puffed in last out of 29 countries, devoting half the global average time to physical activity. A study in 2016 found that six in ten state schools had no exercise area. In Poços the cricketers are allowed to use a few of the town’s derelict sport centres. But the rest has been done, quite literally, off their own bats—made by a local carpenter. The balls are imported from Bangladesh.

Unusual too is that women are in the vanguard. Brazil remains cleft by gender stereotypes, but they never infiltrated the pavilion. Today all 14 of the country’s professional cricketers are women, including Ms Sousa. In Poços they are local celebrities. Brazil’s team dream of becoming “the next Thailand”, says Ms Sousa. It too is not a traditional cricketing country, but has rapidly improved and now boasts the world’s tenth-best women’s team in the one-day format (Brazil lags behind at 28th). The hope is that cricket one day becomes an Olympic sport, for then the flow of money and interest would increase.

Within the next five years, Cricket Brasil wants to have 30,000 players in the region around Poços. It is building a federation of teams playing in Salvador, Brasília and São Paulo. “I have no doubt that soon it will arrive in the whole of Brazil,” says Sérgio Azevedo, the mayor of Poços. He sometimes cuts ribbons in a cricket jersey.

Cricket may never receive as much money or adoration as the Seleção, Brazil’s famous football team. But in Poços, at least, it has already hit football for six. ■

Bello

Cuba’s dictatorship has a cultural opposition that it can’t tolerate

WHEN YUNIOR GARCÍA, a dramatist, was still living in his home city of Holguín, in eastern Cuba, the local secretary of the Communist Party, Miguel Díaz-Canel, came to see two of his plays. “We talked,” says Mr Garcia. “He seemed open and more modern. He liked the theatre.” Since 2019 Mr Díaz-Canel has been Cuba’s president. “He has stopped smiling. He reads out everything he says. He has acted as a despot.”

Mr García, one of whose plays has been staged at the Royal Court theatre in London, has suffered from that despotism. He was a founder of the San Isidro movement, a group of artists and writers based in Havana. In 2020 they staged a protest against censorship outside the culture ministry. “It began with 20 people and grew to 500,” he recounts. It was the biggest gathering of its kind in decades. A senior official agreed to meet the artists, though talks got nowhere. But it was a turning point, Mr García thinks.

In its more than 60 years of rule, Cuba’s Communist Party has been adept at isolating dissidents, branding them stooges of the United States. In its early decades the regime enjoyed public support, thanks to free education, health care and housing and the charisma of Fidel Castro. The first crack came with the collapse of the Soviet Union and the end of its largesse to its Caribbean client, later partially replaced by Venezuela.

Now Venezuela’s government has little money, Mr Castro is dead and his brother and successor, Raúl, has retired. Mr Díaz-Canel and the military-bureaucratic complex he heads face unprecedented difficulties. While Donald Trump was president of the United States he intensified sanctions barring most tourism and remittances to the island. This compounded the inefficiencies of Cuba’s centralised economy.

The pandemic kept tourists away and highlighted the parlous state of Cuba’s health service. Hospitals were overwhelmed and oxygen ran short. The economy is still 11% smaller than in 2018. In January 2021 the government devalued the peso, to try to cut subsidies and inefficiencies. As a result inflation was almost 300% last year, according to the Economist Intelligence Unit, our sister organisation. On the black market the peso is worth less than a quarter of the official rate. Many shops have empty shelves, except those that sell in dollars, which many Cubans lack.

Frustration boiled over in spontaneous protests across the island on July 11th 2021, in which there were isolated incidents of violence. This social explosion was fanned by mobile phones and the internet, to which the government granted access in 2018. It was probably the biggest public challenge to the regime since the 1960s. The response was harsh: almost 800 people were charged over the protests and more than a hundred have so far received long prison sentences, some of up to 30 years, in summary trials.

On July 11th Mr García and his movement, now called Archipelago, demanded 15 minutes on television to explain their view of the events. They were arrested and he spent a night in jail. Cracks showed in the normally monolithic façade of the regime. Silvio Rodríguez, a prominent singer-songwriter and a pillar of the revolution, met Mr García. “He’s conscious of the situation,” says the playwright. “But he’s devoted his life to a Utopia and can’t admit that he’s wrong.”

Archipelago sought official permission to organise a peaceful protest last November 15th to call for the release of the prisoners. In response the regime ordered military mobilisations on that day. So the protesters switched to November 17th. The security police told Mr García he would go to jail for 27 years. He said he would march alone carrying a white rose. But in the days beforehand his home was surrounded by a mob of 200 people. Rather than face long jail terms, he and his wife, Dayana, escaped to Madrid. The regime seemed content to let them go, its usual expedient with troublemakers. Dozens of other activists, artists and journalists have left the island since July, many of them ending up in the Spanish capital.

The government has shut Mr García’s theatre group. Archipelago is dispersed. But it has already achieved something. It has shown that the regime faces not just a disgruntled populace but also an intellectual opposition it does not know how to handle and which is hard to brand as the creation of the CIA. By repressing such voices, the regime can doubtless stay in power. But other voices may pipe up, reminding the world that Cuba is like Russia, only sunnier.

Asia

• The Indian Premier League at 15: Beyond the boundary

Beyond the boundary

How the IPL reflects India’s strengths—and weaknesses

IN AUGUST THE Board of Control for Cricket in India (BCCI), a sports-administration body, invited sealed bids for two new franchises in the Indian Premier League (IPL), an annual domestic tournament of the world’s greatest sport. Two months later, at an event in Dubai, it opened the envelopes. The BCCI had set a confident minimum price of $270m for each team. The largest bid was an eye-popping $940m. The next biggest stood at $750m—more than the total price of all eight franchises when the league started in 2008.

The 2022 tournament, which begins on March 26th, is only the 15th season of the IPL. In that time it has not only turned cricket upside down, but “completely revolutionised the Indian mindset and how the world looks at India”, says Boria Majumdar, an academic who studies cricket.

The idea for the IPL came along in 2007, a propitious time for Indian enterprise. Like the e-commerce platform Flipkart, the ticket-booking firm redBus and the ride-hailing company Ola, all of which emerged in roughly the same period, the IPL took an American idea and gave it a local twist. Lalit Modi, a mid-ranking BCCI official, saw the creation of Twenty20 cricket, a made-for-television, three-hour version of the game, as an opportunity to create a lucrative, city-based competition.

Mr Modi persuaded members of India’s business and entertainment elite to stump up a combined $723m for the ownership of eight franchises. Despite a name that pays homage to English football, he borrowed liberally from American sports. A small number of teams and a short fixture list were designed to make every game feel important. Matches were played at the same time every evening to encourage families to tune in regularly. The lack of promotion or relegation protected the value of investors’ assets from a sudden depreciation. A team salary cap prevented the richest franchises from dominating. Sony, which runs a network of channels in India, paid $1bn for broadcast rights to the first ten editions. When that contract ended Star India, another broadcaster, paid two and a half times as much for half as many years.

The league was an immediate hit. The cricket was fast-paced and exciting. The grounds were packed with celebrities. Imported cheerleaders added an exotic twist. By broadcasting in regional languages and opening fan zones for people to watch matches on big screens in remote parts of the country, the IPL made cricket more accessible and reflected the diversity of India. The acceptance of players from other states and even countries in teams named after a city or a state promoted the idea of Indian tolerance and cosmopolitanism.

Sponsors, too, began to wake up to the tournament’s heterogeneous audience. By 2017 the Kings XI Punjab team jerseys bore the logo of Lotus Herbals, a make-up and skincare brand. Women were 43% of the IPL’s television audience in 2020; plans for a women’s league are gaining momentum. Alec Scheiner, a partner in RedBird Capital which bought a stake in Rajasthan Royals last year, believes the popularity of the IPL “is like the NFL [an American-football league] and the NBA [America’s basketball league] combined” (see chart).

The tournament has also promoted social mobility. Though cricket has long been a national preoccupation, it was an elite pursuit (a former national captain’s childhood nickname was maharajah; another was literally a prince). The beginnings of India’s economic liberalisation in 1991 led “to an explosion of the middle class and the empowerment of small towns everywhere”, says Amit Varma, a writer based in Mumbai. Within a decade some of India’s finest players, such as M.S. Dhoni (pictured), a former captain who once worked as a ticket inspector for Indian Railways, were emerging from places and families with no cricketing pedigree.

By expanding opportunities in the sport, the IPL supercharged this trend. League contracts alone offer a very good living, but success there has become a springboard for a place in the national team. Mohammed Siraj, a fast bowler and the son of a rickshaw-driver, won a contract to play in the IPL for Sunrisers Hyderabad and now represents India in Twenty20 cricket and in Test matches, the most prestigious form of the game.

The IPL has also made a mark outside India, becoming a big cultural export and prompting nearly every other cricketing nation to copy its format. Some, such as the Caribbean Premier League, have succeeded in establishing themselves. Others have imploded amid corruption or financial scandals. Mr Majumdar believes the replication of the IPL around the world “has given a rising India a sense of confidence that it is possible to create a brand that goes on to achieve global dominance”.

Yet if the league holds up a mirror to all the things India likes about itself, it also reflects some of its weaknesses. Two separate match-fixing scandals emerged in 2013. Two teams were banned for two seasons, but the credibility of the league and the reputation of its brand were tarnished. Players from Pakistan, cricket’s second-biggest market, remain unwelcome. And the BCCI still maintains a highly protectionist attitude towards Indian players. Although set numbers of foreigners are welcome in the IPL, Indian cricketers are banned from playing in franchise tournaments abroad. Unmukt Chand, who led India to victory in the Under-19 World Cup in 2012, was forced to retire from all cricket in India to take up contracts to play in America and Australia.

The IPL is now sufficiently dominant within cricket that it can do whatever it likes. No national boards want to compete by scheduling matches against it. A new domestic broadcasting-rights deal is imminent, which is expected to double in value to at least $1bn a year, conferring yet more power. But there are reasons for the BCCI to be cautious. Increasing the number of teams risks reducing the quality of the cricket, and longer seasons could bore viewers. In its first decade and a half the IPL has shown that, by borrowing ideas from elsewhere and adapting them to the local market, Indian entrepreneurs can dominate at home and abroad. Its next 15 years will reveal what kind of leadership it wants to project. That applies to India itself as much as to the Indian Premier League. ■

Horrible histories

A new film on Kashmir has found a fan in Narendra Modi

INSIDE CINEMAS, “The Kashmir Files” starts with a disclaimer: “This film... does not claim accurateness or factuality of historic events.” Outside the cinema, in contrast, the relentlessly violent drama is being promoted with what might be called a very big claimer. Narendra Modi himself, India’s prime minister, has hailed the film for exposing long-buried truths. So keen to share these is his Bharatiya Janata Party (BJP) that states it runs have scrapped local entertainment taxes for the movie.

High-powered promotion is not the sole reason why “The Kashmir Files” has bagged over $25m since it opened on March 11th, a post-pandemic record. The film also provokes strong emotions. Its story revolves around the very real tragedy of the Kashmiri Pandits, an ancient community of high-caste Hindus who were once perhaps 5% of the population of the Kashmir Valley.

Pandits were targeted by Islamists backed by Pakistan during a cataclysmic surge in violence in the 1990s. Police protection was scant. All but a few fled, never to return. Official reports and scholarly research suggest that more than 200 were murdered, among the 14,000 civilians, 5,000 Indian soldiers and 22,000 militants killed during the past three decades of strife in the valley.

These other casualties get no mention in the film. Instead, within its first 15 minutes we see Muslims betraying Hindu neighbours, chanting “Convert or die!”, beating Pandit children and visiting unspeakable (but apparently not unfilmable) acts of savagery upon women. By the end of the film it is not just the awfulness of Muslims that is doggedly bludgeoned into viewers. So is the perfidy of whiny leftists, intellectuals and politicians who dare suggest that Muslims, who are 95% of the Kashmir Valley’s population, might be victims of a sort, too. Small wonder that in cinemas across India hot-headed youths, many of whom appear to belong to extreme Hindu-nationalist groups, are making rousing sectarian speeches.

In the Kashmir Valley itself the film has been met with silence. This is partly because cinemas there closed in the 1990s. Zayd Hanief, a 22-year-old law student who watched the film on a visit outside the valley, says he was revolted. “It simply confirms the worst stereotypes about Muslims.” To some, the boosting of the film by Mr Modi, whose government in 2019 imposed direct rule on the once semi-autonomous state of Jammu and Kashmir, and has cracked down fiercely on dissent, feels ominous. “Kashmiris see it as a prelude to more serious oppression,” says Sheikh Showkat Hussain, a legal scholar and political analyst based in the valley. “The movie will be used as justification for whatever the government is doing or will do here.”

Silent Stans

The Stans want nothing to do with Vladimir Putin’s invasion of Ukraine

IT WAS ONCE part of the Soviet Union, shares a long border with Russia and counts among its citizens a large ethnic-Russian minority. Russian nationalists lay claim to swathes of its territory and President Vladimir Putin has in the past cast aspersions on its statehood. Gennady Zyuganov, the leader of Russia’s Communist Party, has accused it of Russophobia and the oppression of Russian-speakers. Little wonder then that Kazakhstan is watching Mr Putin’s invasion of Ukraine with apprehension verging on horror.

The war has set nerves jangling across Central Asia. The “Stans”, as the region’s five post-Soviet states are known, are, broadly speaking, allies of Russia. But the aggressive expansionism of their former colonial master is testing that friendship to the limit. None of the countries has condemned the invasion. But nor has any offered public support or succumbed to pressure to follow Mr Putin’s lead and recognise the breakaway regions of Luhansk and Donetsk in eastern Ukraine. At a vote in the UN General Assembly deploring the invasion, on March 2nd, three abstained and two simply did not show up.

Kazakhstan, the biggest and richest of the lot, has long cultivated warm relations with Russia. It is a member of a collective-security treaty with its bigger neighbour, along with a handful of other countries including Kyrgyzstan and Tajikistan. In January, when protests in several cities turned violent and threatened to destabilise the country, Kassym-Zhomart Tokayev, Kazakhstan’s president, invoked the treaty’s mutual-defence clause and asked for help from Mr Putin, who duly delivered. But the country also enjoys good relations with the West and has no desire to join Russia as an international pariah. Mr Tokayev has said that his priority is to safeguard Kazakhstan’s “security, sovereignty, territorial integrity”. He is the only Central Asian leader to have spoken to Volodymyr Zelensky, Ukraine’s president, since the invasion began. (He has regular chats with Mr Putin.) He has offered to mediate.

Most countries are treading a fine line. Authorities in Almaty, Kazakhstan’s largest city, have allowed anti-war protests—though only once—and Kazakh police have fined drivers displaying the letter Z, a symbol of Mr Putin’s invasion. Yet two bloggers known for anti-Russian rhetoric have been jailed, too. Uzbekistan has supported Ukraine’s territorial integrity and declined to recognise the breakaway republics. But it has also leant on journalists who are noisily sympathetic to Ukraine.

Kyrgyzstan, which hosts a Russian military base, has come closest to offering (muted) support for Russia. Mr Putin’s recognition of Luhansk and Donetsk may have been “a necessary measure to protect the civilian population”, mused Sadyr Japarov, the president, on Facebook. But that was before the invasion. Since then his public stance has been one of neutrality. Uppermost in his mind may be the position of millions of Kyrgyz migrants working in Russia. That is also a concern for remittance-dependent Tajikistan, which has maintained a studied silence. So has isolationist Turkmenistan, which barely acknowledges what is happening in the outside world and is in any case busy establishing a political dynasty as Serdar Berdymukhamedov, its new president, assumes power from his father, Gurbanguly.

Whatever their leaders’ diplomatic manoeuvres, it will be hard for the Stans to avoid the economic fallout. The rouble’s collapse has dragged down their currencies. The Kyrgyzstani som has plunged by 15% since the invasion started and the Kazakhstani tenge by 14%. In part, that is because remittances from Russia are likely to slump, too: by a third in Kyrgyzstan and a fifth in Tajikistan, reckons the World Bank. That will hurt. Remittances are worth nearly a third of GDP in Kyrgyzstan and over a quarter of GDP in Tajikistan.

Kazakhstan, Turkmenistan and Uzbekistan are energy-rich and may hope to cash in on buoyant oil and gas prices. But even that can be held hostage. Russia says a pipeline, which crosses its territory to the Black Sea and carries most Kazakh oil, may close for repairs for two months. The move is seen by many as a response to sanctions, with Kazakhstan as collateral damage. “There is this famous saying that if Russia sneezes, Kazakhstan gets a cold,” says a senior Kazakh official. “This will be not a sneeze but perhaps pneumonia, and we will get covid or something.” ■

Palace politics

South Korea’s president-elect starts with an unpopular personal project

ARRANGED IN TWO straight lines as if in formation, protesters outside South Korea’s defence ministry pumped their fists in time with a martial beat. “How many livelihoods are going to be killed by this move?” one demonstrator shouted. Ordinarily they would be found in Gwanghwamun, a wide plaza a few hundred metres from the presidential palace, known as the Blue House after the azure tiles on its soaring roof. But news that Yoon Suk-yeol, the president-elect, wants to move the administration to the ministry complex, a few miles south, had brought them to its gates.

Mr Yoon revealed his decision at a press conference two days earlier, on March 20th. He described the Blue House, nestling at the foot of an imposing mountain and sequestered behind security barricades and a long driveway, as an “isolated royal palace” and a “symbol of imperial power”. Instead, the man from the conservative People Power Party plans to bring power closer to said people upon his inauguration on May 10th. An existing building within the defence ministry’s grounds is to be converted into the presidential office (a residence has yet to be decided). A new park will be built around it, giving citizens a view of their government hard at work. It is meant to be in keeping with Mr Yoon’s victory-speech promise to “listen to the valuable opinions of the people”.

The people’s opinion is that it is a waste of money and a risk to national security. Mr Yoon’s transition team estimates the price tag at just under 50bn won ($40m). But that does not include the cost of moving defence officials currently in situ, which Mr Yoon’s own party estimates at another 120bn won. And while the defence ministry is already amply fortified, bunker and all, putting the president there would allow a missile strike to wipe out both military and political leadership in one fell swoop. A petition opposing the move quickly reached the 200,000 signatures needed to trigger an official reply.

My Yoon’s new neighbours are not thrilled either. In Samgakji, a dense, low-rise district next to the defence ministry, some business-owners welcomed the prospect of increased footfall. But many more seemed concerned about what else might come along with it: more traffic, annoying new security rules and the disruptive rabble of demonstrators and accompanying police officers that frequently fill Gwanghwamun. “Where do you think they’re going to protest?” grumbles the owner of a local dry-cleaner. “They’re going to protest in front of my shop.”

Moon Jae-in, the outgoing president, tried to make a similar move before admitting defeat in the face of logistical problems. His Minjoo party argues that a president-elect lacks the authority to move a government building or to allocate funds for such a move.

South Koreans complain that Mr Yoon promised on the campaign trail that his top priority would be addressing the economic damage caused by covid-19. Instead he has decided to spend political capital forcing through a personal project. With his popularity already at a historic low for an incoming president, Mr Yoon may find that his attempt to bring the people closer actually drives them farther away. ■

Banyan

Joko Widodo is considering extending his term in office

WHO CAN forget that moment, eight years ago, when a slight former furniture salesman with a winning grin rose to the presidency of Indonesia? Joko Widodo, known as Jokowi, had a modest upbringing in the small city of Solo in Central Java. He had become that city’s mayor, from where his reputation for rolling up his sleeves and fixing problems had propelled him to the governorship of Jakarta, the country’s sprawling capital, and then to the presidential palace. A man of the people, he connected with voters in the markets and back alleys. For the first time, a ruler did not hail from the army or the country’s elites. And so, in the story of Indonesia’s democratisation, Jokowi’s election in 2014 marked a decisive break from the era of Suharto, the dictator whose regime had crumbled in 1998.

And who can fail now to notice ominous parallels emerging with the late strongman, who in effect abolished politics, co-opting the army along the way? Jokowi’s second term ends in 2024, after which he has to step down. Yet Jokowi’s powerful henchmen, if not yet the man himself, muse aloud about his staying on by altering the constitution to extend his term by three years. Why, asks Luhut Panjaitan, a minister and sidekick, go to the unnecessary expense of elections? Why risk (unspecified) election violence? Besides, argues the former general of the Suharto era, calls for Jokowi to stay abound on social media. Mr Luhut says he and others are merely “trying to accommodate the aspirations of the public from this big data”.

Presidential hopefuls who cry foul, such as the governor of Jakarta, Anies Baswedan, are dismissed as self-serving. The views of the main political parties are more consequential: the support of two-thirds of parliament is required to amend the constitution. Gerindra, the third-largest party, says it opposes an amendment. So do members of the Indonesian Democratic Party of Struggle, or PDI-P, to which the president belongs.

But Jokowi’s talents for co-option are legend. Gerindra’s leader, another former general, Prabowo Subianto, twice ran for president against Jokowi, but is now defence minister. Two weeks ago Jokowi invited PDI-P’s boss, Megawati Sukarnoputri, to his palace in Bogor, west of the capital. She knows it well, both as a former president herself and as a daughter of Sukarno, the country’s independence leader. She is nothing if not a dynast, and the president could offer her daughter, Puan Maharani, parliament’s speaker, the vice-presidency. Democratic norms, says a former minister, are hanging by a thread.

Power has changed Jokowi. Explanations for his quest to extend his rule include the fact that the non-dynast has turned dynast himself. He is known to be keen to see his son, who has followed in his footsteps as mayor of Solo, become governor of Central Java, a province of some 37m people.

Another is Jokowi’s grand scheme to carve a new capital, Nusantara, out of the jungle of East Kalimantan province on the island of Borneo. The justification is that the current capital is gridlocked, sinking and flood-prone. But as Mr Anies argues, Jakarta is fixing its problems by cutting groundwater extraction and building sea walls. Bureaucrats and their families hate the idea of moving. The main boosters—from the political and business elite around Jokowi—have land and other interests around the site. If Jokowi loses power it is much less likely the $35bn white elephant will get built.

Strolling in the garden of the palace in Bogor, Jokowi once rehearsed Suharto’s qualities for Banyan’s benefit: the dictator got stuff done. Jokowi’s obsession, too, is for building things—roads, ports, power plants and more. The difference, says a former ally, is that Suharto had a team of technocrats to set economic priorities; he then got his business cronies to carry out the plan. By contrast, Jokowi’s cronies set the priorities.

In the end cronyism, corruption and economic crisis did for an out-of-touch Suharto. A whiff of economic crisis is in the air again, exacerbated by the war in Ukraine. Jokowi frets that sharp increases in the price of cooking oil are distressing poorer households. Prices of fuel, wheat and other foodstuffs are rising, too. That may be just the beginning. Yet Jokowi seems less attuned to the anger building among the middle class over the possibility of a power grab. The risks of a twin economic and political backlash are clear. If Jokowi is not careful, the man whom popular acclaim brought to power may yet be confronted by raging popular discontent.

Read more from Banyan, our columnist on Asia:
A debate about nuclear weapons resurfaces in East Asia (Mar 19th)
It is getting harder for small states to balance great powers (Mar 12th)
Ukraine has changed how Taiwanese see themselves (Mar 5th)

China

• Chinese politics: Xi’s stormy year

Xi’s hard year

In a crucial year politically, Xi Jinping wants stability

NO DATE HAS been set for it yet, not even a month. But for every official, the orders are clear. Their work must focus on making sure that a crucial Communist Party congress, to be held in the second half of the year, goes smoothly. The conclave is widely expected to herald the start of at least another five years of rule for Xi Jinping. From the police to economic policymakers, all are trying to minimise untoward events that might overshadow his moment of political glory. “The word ‘stability’ is the key,” leaders intone about the coming year at official gatherings.

It will be a far bumpier ride than they would like. In recent weeks the rapid spread of Omicron, a highly transmissible variant of the virus that causes covid-19, has posed an unprecedented challenge to China’s much-vaunted “zero-covid” policy. Widespread lockdowns have added to the wobbles of an already shaky economy. Just this month Mr Xi contrasted the party’s rule with “Western chaos”. He was referring, in part, to China’s two years of success (after a botched initial response) at crushing covid. If officials relax the policy to protect the economy they would risk a surge of cases that could overwhelm China’s fragile public-health system.

Russia’s invasion of Ukraine is another severe headache. The war began less than three weeks after Mr Xi and his Russian counterpart, Vladimir Putin, signed a joint statement in February declaring “no limits” to the two countries’ friendship. Chinese diplomats are now struggling to balance a desire to preserve what they see as this crucial relationship against a risk of even greater tension between China and the West, which could compound China’s economic difficulties.

Public opinion is hard to gauge, but there is little sign that the party’s policies on covid, Ukraine or the economy are widely resented. Many Chinese express support for the tough zero-covid approach. On social media, however, some grumbling circulates—despite censors’ efforts to stifle it. Even in the state-controlled press there have been occasional hints of disagreement over the party’s economic strategy, which last year included a regulatory clampdown on tech firms and a call by Mr Xi for “common prosperity” that scared entrepreneurs by raising the spectre of big redistributive schemes. Intriguingly, the prime minister, Li Keqiang, mentioned common prosperity only once in his state-of-the-nation speech to the national legislature on March 5th.

Among China-watchers, there is much speculation about the extent of opposition to Mr Xi within the elite, and the impact it might have on his political grip. But there is no convincing evidence that his plans could be derailed for the party congress and a meeting immediately afterwards of the Central Committee, which will announce the leadership line-up (including his own likely appointment to a third term as party chief, violating recent norms). Indeed, history suggests that for all the party’s preoccupation with stability in the build-up to party congresses, which normally are held every five years, the power of paramount leaders can survive enormous buffeting.

Mao Zedong, for example, ruled China for nearly 27 years, despite the deaths of millions in a famine of his own making, bitter political struggles within the party and at least one attempted coup. Deng Xiaoping retained authority well after his retirement, despite public resentment of his bloody suppression of the Tiananmen Square protests of 1989 and open criticism of his policies by conservatives in the party who saw them as a catalyst of the unrest. Similarly Jiang Zemin, who had overseen mass lay-offs from state-owned firms (angering millions of workers as well as conservatives), wielded much power long after he retired from his last post in 2004.

Mr Xi’s bid for an extension of his rule must anger some in the party. Cai Xia, a former academic at the party’s most prestigious training centre for officials (she now lives in America), has accused Mr Xi of forcing the party to “swallow dog-shit” by ordering the Central Committee in 2018 to approve a constitutional revision to facilitate his bid. But there is little sign today of the kind of turbulence in elite politics that marked the build-up to Mr Xi’s anointment as party chief in 2012. That year saw near-open feuding involving a prominent political rival, Bo Xilai, a member of the Politburo whom Mr Xi later accused of being involved in a plot to seize power.

Purges have continued. An 18-month “rectification” campaign of the domestic security forces ended late last year, aimed in part at rooting out those disloyal to the party and Mr Xi. Its most powerful targets included a deputy minister of public security, Sun Lijun, who was accused of leading a “political cabal” within the police (he was formally charged with corruption in January), as well as Fu Zhenghua, a former minister of justice. On March 21st it was announced that a former vice-president of the supreme court, Shen Deyong, was under investigation for unspecified crimes.

But there is no sign of any open campaigning for power of the type that Mr Bo engaged in. Mr Xi’s relentless onslaught against corruption—sometimes a smokescreen for attacking his political enemies—has sown such fear within the party hierarchy that it is hard to imagine any such challenge today. Barriers to organising against him are “near insurmountable”, wrote Richard McGregor and Jude Blanchette in a report on post-Xi succession scenarios that was published last year by the Centre for Strategic and International Studies in Washington and the Lowy Institute in Sydney.

On his management of the pandemic, Mr Xi is showing no sign of wavering. “Perseverance is victory,” he said at a meeting on March 17th of the Politburo’s seven-member Standing Committee. He called for a “step-up” in mobilisation and “unremitting efforts” to combat the current wave of outbreaks. Mr Xi also said that “maximum” effort should be made to minimise harm to the economy and society. But similar phrases have been used by officials before over the past two years.

Crucially, there has been little sign of any let-up in the punishment of officials for letting covid spread on their watch. The South China Morning Post, a newspaper in Hong Kong, has counted more than 70 who have been sacked or reprimanded during this wave. The experience of Hong Kong may encourage mainland officials to stay vigilant. The number of cases detected daily in that city far surpasses the total on the mainland. Daily deaths in Hong Kong have risen to about 200 compared with a handful, if that, in the rest of China. As they see it, Hong Kong’s plight is the result of not pursuing a zero-covid policy thoroughly enough. They note that it lacks the kind of manpower the mainland deploys to ensure compliance.

At this month’s parliamentary meeting Mr Li, the prime minister, admitted the going would be tough. This year, he said, China faced an “obvious increase in dangers and challenges”. But he ended his speech with his usual injunction: “We must unite ever closer around the party centre with Xi Jinping at its core.” It would take daring to do otherwise. ■

Lockdown legions

The extraordinary manpower behind China’s zero-covid strategy

THE THIRD fall was the one that finally put Gao Ying in the hospital. As a community health worker, she had been helping Hangzhou, her home city, fight a surge in covid-19 cases. She had not slept in her own bed for two weeks. She was exhausted. Still, on March 18th she set off for a meeting on local covid-control measures. That’s when she collapsed three times in a lift, the third time smacking her head on the wall. Video of the incident was captured by a CCTV camera and shared on social media.

Ms Gao’s tireless efforts were in response to an outbreak that most countries would consider trivial. Hangzhou, with 12m people, had recorded just 54 symptomatic cases of covid in the two weeks before her fall. (Ten more were asymptomatic.) Overall, China has logged around 27,000 new local symptomatic cases in March, fewer than America recorded most days this month. Still, it is the biggest outbreak in China since the early days of the pandemic (see chart). And it is straining the country’s “dynamic zero-covid” policy, which aims to stamp out the virus with mass testing, extensive contact tracing and strict lockdowns. Those efforts involve millions of workers like Ms Gao.

Technology, such as tracking software, helps. But much of the work involves clipboards, telephones and barricade tape. An important role is played by some 110,000 neighbourhood committees—legacies of the Mao era, when they helped China’s Communist Party keep order. Each committee has between five and nine members, as well as many volunteers. Today they keep tabs on residents, help enforce lockdowns and organise testing.

A neighbourhood committee member might, for example, ask a person who has just travelled from another city to take a test or stay inside for a few days. During targeted lockdowns of, say, a housing compound, they control who gets to go where. (Security guards and China’s 7.7m food-delivery workers are also important during these times.) Smaller cities, of 5m people or fewer, are supposed to be able to test everyone in just two days. That involves a lot of door-to-door visits by committee members, as well as volunteers who organise people in queues.

Contact tracing, in particular, is labour-intensive. The city of Shanghai alone has 3,000 workers devoted to the effort. Most are public-health officials. During outbreaks they can be on call 24 hours a day. Some sound a little worn out. “In a week of continuous battle with the virus, everyone stayed up all night several times, pushing our bodies to the limit,” says one. “So please can everyone who receives a call be patient and co-operate.”

If some people are frustrated with the state’s zero-covid footsoldiers, it is perhaps because there are so many of them—and they don’t always co-ordinate. A person might receive a call from several different officials: one from where they work, another from where they live and yet another from where they have been recently. The police, neighbourhood committees and businesses work the phones, too, checking on people’s whereabouts. Scammers have tried to take advantage of the situation. Real contact tracers will not ask for your bank details, warns an official guide to the process.

Before the pandemic, neighbourhood committees did not have much power. Now, though, they can confine people to their houses for weeks. Invasions of privacy are common. Cameras are often placed outside flats to ensure compliance with isolation protocols. A person might receive a visit after buying drugs that suggest he has a fever. Some high-profile abuses have left people outraged. Health workers in the central city of Xi’an beat up a young man who violated lockdown to buy a steamed bun. Local officials in some provincial cities killed the cats and dogs of quarantined residents out of fear that the animals might spread the virus.

But for the most part the public has been supportive of those implementing the zero-covid policy. For many Chinese, the country’s relatively low number of cases and deaths justifies the overall strategy. If anything, they feel sympathy for the workers involved. The video of Ms Gao attracted much attention. “It’s the third year of the epidemic. Can’t we find a way to slowly reduce the burdens on front-line workers?” said one commenter.

The highly transmissible Omicron variant will make that difficult. Provinces have tended to share workers, depending on where there is an outbreak. But with Omicron spreading across the country, resources are limited. Chinese doctors hint that changes to the zero-covid policy are coming and that the state’s most stringent measures will eventually be lifted. For now, though, China’s politicians are merely tweaking the strategy. “From beginning to end” China must “put lives above all else”, President Xi Jinping told the Politburo’s seven-member Standing Committee on March 17th. The footsoldiers of zero-covid will remain busy. ■

Dig deeper

All our stories relating to the pandemic can be found on our coronavirus hub. You can also find trackers showing the global roll-out of vaccines, excess deaths by country and the virus’s spread across Europe.

Salvation through selfie

How narcissistic youth might help struggling Chinese booksellers

IN 1993, AFTER 14 years of imprisonment, one of China’s most prominent dissidents, Wei Jingsheng, was taken on a tour of Beijing. Authorities hoped that the dazzling new architecture and bustling roads would convince him that the Communist Party he so stubbornly opposed had done great things. Mr Wei admitted to being impressed, but asked to see a bookshop before drawing any firm conclusions.

His tour guides obliged, and later he recounted his “eye-opening” visit. Chinese bookshops remained too conservative, he wrote. They were managed by old officials who didn’t even like books and displayed staid party literature. Bureaucrats would “rather build tall skyscrapers and purchase fancy limousines than…allow the book and culture markets to really open up,” wrote Mr Wei.

Some of China’s state-run stores remain the kind of dull, dusty places described by Mr Wei. Others have spruced up nicely, though. China also now has thousands of independent bookstores, serving coffee and tea and hosting events.

But like their counterparts elsewhere, China’s bricks-and-mortar bookshops are struggling. Their share of book sales declined from 85% to 20% between 2010 and 2020. Online sellers are luring bookworms out of bookshops. In a survey published in November, 80% of bookshop-owners said revenues were falling.

Chinese proprietors have unique problems, too. Only titles that have been cleared by state censors can be placed on shelves. Even the hippest shops feel compelled to display the ponderous works of Xi Jinping, China’s leader. Attempts at edginess carry risks. In February a bookstore in the city of Hangzhou featured works related to the well-known case of a trafficked woman found chained by the neck in a village outhouse. The display, with books about feminism, was decorated with a metre-long metal chain. But the authorities deemed it too controversial, and the store took it down after a few days.

Some sellers are finding other ways to attract potential customers. Bookshops have become a popular destination for Chinese internet celebrities, known as wanghong, and those who aspire to such heights. In pursuit of followers, clicks, sponsorship deals and modelling contracts, they post photos of themselves at attractive locations, which also include museums and amusement parks.

It is easy to find online listings of the hottest wanghong bookshops. Some have big windows with views of famous landmarks. One favourite, part of the Zhong Shu Ge chain, is in north-western Beijing. It features dizzying Escheresque staircases and a mirrored hall. The walls are lined partly with books—and partly with wallpaper that looks like books.

On a recent weekday morning the shop had an ample flow of people browsing and buying. But there were no wanghong in sight. “They all come on the weekends,” said a clerk, “and we just hope they’ll buy something while they’re here. Even if it’s only coffee.”

Chaguan

China has honed its justifications for taking Russia’s side

A MONTH AFTER Vladimir Putin plunged Europe into war, China is ready to explain why it sees no urgent need to stop Russia—its closest strategic partner—from killing Ukrainians. After fine-tuning arguments and propaganda lines for weeks, China’s Communist Party bosses and their envoys now have talking points for every audience.

The most common argument is built on deflection and anti-Americanism. This is used for Chinese domestic consumption and in public contacts with Western governments. As Chinese officials tell it, Russia is defending itself against American aggression and a long campaign of encirclement by NATO. Chinese officials think it is unfair of Western leaders to ask their government to intervene, because only American concessions to Mr Putin can bring lasting peace. Moreover, if the war is going slowly, that is because American interests profit from drawn-out agonies, Chinese diplomats charge. Spelling out the accusation, a deputy foreign minister, Le Yucheng, told a gathering at Tsinghua University that “arms dealers, bankers and oil tycoons” from a certain big country (ie, America) are making “highly immoral” fortunes out of the war, while Ukraine suffers. This hard line comes from the top. China’s supreme leader, Xi Jinping, has given instructions that Russia is to be defended and America held responsible for Ukraine’s woes, leaving underlings to “backfill a foreign policy” around that decision, a foreign diplomat based in Beijing explains. To dramatise America’s obligations, Mr Xi reached for a Song-dynasty saying during a two-hour video call with President Joe Biden on March 18th, declaring: “He who tied the bell to the tiger must take it off.”

Mr Xi’s scolding, literary tone is striking because, according to American briefings given to foreign ambassadors in Beijing, Mr Biden used the call to convey his concerns that Russia may be contemplating attacks with chemical or biological weapons in Ukraine. His warnings were not a surprise to the Chinese. A few days earlier Mr Biden’s national security adviser, Jake Sullivan, shared American intelligence about Russia’s possible intentions with China’s foreign-policy chief, Yang Jiechi, during a seven-hour meeting in Rome. Mr Sullivan told Mr Yang that Chinese support for Russian aggression would have a lingering impact on bilateral ties and on Mr Xi’s legacy. Mr Yang, it is related, responded with anger and complaints about America’s support for Taiwan, the democratic island that China claims as its own. Other officials have since copied that same rhetorical pivot to Asia. Mr Le called the crisis in Ukraine and NATO enlargement a mirror for observing American alliance-building in Asia and the Pacific, a trend which if unchecked would push the region “into a pit of fire.”

To Europeans, it might seem a bit parochial for China to draw parallels between a war under way in Ukraine and long-standing Chinese resentments of American alliances in Asia. But seen from Asia, there is a logic to China’s framing of the war in Ukraine as the latest example of global disorder provoked by the West, with a special emphasis on the sanctions being imposed on Russia. In their video call Mr Xi told Mr Biden that intensifying sanctions may gravely disrupt food and energy markets and global supply chains. After meeting African and Asian foreign ministers, China’s foreign minister, Wang Yi, spoke of a common disquiet among developing nations at being asked to take “black or white” moral positions on complex international questions.

Such ultra-pragmatic talking points, crafted to woo countries from the global South, reflect a Chinese horror of being isolated. But they also resonate with many governments, says a foreign diplomat in Beijing, describing meetings at which ambassadors from non-aligned countries swallow Chinese arguments “like candy”. China has a keen sense of countries with long-standing grievances about the West, or that have been placed under sanctions themselves for rights abuses, notes the diplomat. Against that, some South-East Asian governments, from Singapore to Cambodia, have voiced concerns about the dangerous precedent set by Russia’s attack. China’s growling about alliances cuts both ways, says a second diplomat. “China is worried about an Asian NATO. The only player that could make it happen, guaranteed, is China. Just invade a neighbour and see what happens,” he suggests.

Guarding each other’s backs, against the West

A final talking point is offered more discreetly by Chinese officials and scholars. This coldly realist argument asserts that China’s interests are simply not served by breaking with Russia. Zhou Bo, a retired senior colonel in the People’s Liberation Army, now at the Centre for International Security and Strategy and its China Forum at Tsinghua University, insists that China is taking a balanced approach to the war. But he predicts that if China were to condemn Russia’s actions, Western governments would pocket the concession and call it China merely doing the right thing. There is little chance that broader, long-term American pressure on China will ease, because China is not about to change its political system, adds Mr Zhou. As a result, “If China ditches Russia, it is only a matter of time before America comes after China once more.”

Wu Xinbo, dean of the international-studies institute at Fudan University, calls it natural that in his conversation with Mr Biden, Mr Xi stressed Chinese concerns about American support for Taiwan. “Russia may worry about Ukraine joining NATO, but Ukraine is an independent sovereign country. Taiwan is part of China. So in this sense, the Taiwan issue is far more important to China than Ukraine is to Russia,” he says.

Western governments are frustrated that China calls itself a peace-loving giant but will not condemn Mr Putin. That is to misread China, a country at once certain that its rise is unstoppable, and sure that America is bent on stopping it. China has ambitions to bestride the world one day. But it remains exceptionally self-absorbed. Suffering in faraway Ukraine will not change that. ■

Read more from Chaguan, our columnist on China:
Omicron is changing China’s covid strategy (Mar 19th)
Xi Jinping places a bet on Russia (Mar 12th)
Vladimir Putin is an imperialist, but China does not care (Mar 5th)

All our stories relating to the pandemic can be found on our coronavirus hub. You can also find trackers showing the global roll-out of vaccines, excess deaths by country and the virus’s spread across Europe.

Middle East & Africa

• African economies: Trade flaws

Trade flaws

Why it costs so much to move goods around Africa

IF TIME IS money, then Beitbridge must be a most expensive place. Late last year lorries carrying, among other things, cobalt from Congo, copper from Zambia and tea from Malawi snaked for miles as they waited to cross the Limpopo river into South Africa. Many were there for days. Some drivers bribe their way to the front; 1,000 rand ($68) is the going rate. Others cannot. In 2020 four drivers are said to have died in their vehicles while waiting.

African politicians say they want to end such bottlenecks. The African Continental Free Trade Area (AfCFTA), so far ratified by 41 of Africa’s 55 countries, could boost the region’s economies by making it easier to trade among them. In 2020 just 18% of exports were to other African countries (see chart), lower than the equivalent shares in North America (30%), Asia (58%) or Europe (68%). More trade within the region could lead to more jobs, higher wages and less poverty.

The AfCFTA pledges to grease the wheels of trade in two ways. The first is by reducing tariffs, especially between countries in different regional blocs, such as the Southern African Development Community and the East African Community. This could boost intra-African trade by 15-25%, reckons the IMF. But double that effect would come from reducing “non-tariff barriers”, the grit that really gums up trade.

Poor infrastructure is one such barrier. Africa’s land area is big enough to accommodate China, India, the contiguous United States and much of Europe. Yet its railway network is not very much bigger than France’s and Germany’s combined. Many lines were built by colonial companies to link mines to ports, rather than countries to one another. And existing tracks are struggling. South Africa’s state network operator was eviscerated by corruption under Jacob Zuma, a former president. Newer Chinese-built railways in Kenya and from Djibouti to Ethiopia are under-used, either because they struggle to compete with road freight or because they lack ancillary infrastructure such as storage yards.

Ports are small and slow. Cargo waits for more than two weeks on average, as against less than a week in Asia, Europe and Latin America, says CDC Group, a British development-finance institution. Handling costs are around 50% higher than in other parts of the word, reckons the African Development Bank (AfDB).

Some 80-90% of freight goes by road, of which there are not enough. Road density is among the world’s lowest. And just 800,000km of the total of 2.8m in sub-Saharan Africa are paved, says a report from 2018 by the Export-Import Bank of India. Many roads are badly placed. Some duplicate colonial railways; too many are built in the areas of powerful ethnic groups.

The IMF reckons that if the quality of Africa’s infrastructure were brought up to the global average this would increase continental trade by 7%. Surprisingly, though, even bigger gains could be made by improving how trade flows—unblocking the existing pipes, if you will, rather than installing bigger ones. It reckons that if the quality of Africa’s logistics rose to the global average, it would mean a boost of 12%. The gains are large because the cost of logistics in Africa is three to four times higher than the world average, notes a recent paper by Patrick Plane, a French economist. Such costs can add 75% to the price of goods, estimates the AfDB. So long as this is the case, Africans will not feel the full benefits of globalisation and freer trade.

Why are logistics so costly in Africa? Partly it is because of a paradox. Those who want to move merchandise complain that they cannot find lorries. Those with lorries moan that their vehicles spend too long sitting idle. One reason for this is that African countries typically buy more goods than they sell. It can cost twice as much to send cargo from the South African port of Durban to Lusaka than the other way, says Mark Pearson, a consultant based in the Zambian capital. This is because the transporter cannot assume a “backhaul” journey. So he charges double. Others wait around. Lorries taking goods from Lagos to Kano, in the Nigerian north, can spend weeks until there are enough cattle or vegetables to pay for the return journey. When they do head south they often overload the vehicle, damaging the truck and the roads.

Small fleets make things worse. Roughly 80% of transporters own fewer than five lorries. These microbusinesses depend on the cash from one trip to fund the next and can be crippled by a punctured tyre. Sigma Feeds, on the outskirts of Nairobi, once organised its own lorries. No longer. It was too stressful. “Drivers who needed money for school fees might siphon off fuel to sell,” says Vandan Shah, the CEO.

Putting idle lorries to work

Another problem is a lack of information. In much of the world large firms can buy space on trains or lorries in logistics spot markets. But in Africa, where these do not exist, miners or brewers have to sign long-term contracts with larger logistics firms such as Bolloré or South Africa’s Imperial Logistics, in which they agree to pay for capacity, whether they use it all or not. “There is no visibility between supply and demand,” explains Wale Ayeni of the International Financial Corporation, the private-sector arm of the World Bank.

Startups such as Lori Systems, founded in Kenya, and Kobo360, a Nigerian rival, hope to solve this problem by matching traders and transporters in digital marketplaces. This promises not only to reduce wasted journeys, but also to reduce the price-gouging power of trucking cartels. Startups also check paperwork, vet drivers, provide cash upfront to truckers and help with maintenance in case of breakdowns. “If a tyre falls off a driver can go on our app and order a new one,” points out Ife Oyedele, a co-founder of Kobo360.

“Infrastructure is still a massive headache,” says Uche Ogboi, the boss of Lori Systems. “But our mentality is that this is a government thing and we will have to deal with it until they fix it.” Lori, she reckons, can help to improve more than half the obstacles that lead to high transport costs, such as by enabling drivers to forward paperwork to border posts.

“A big part of business in Africa is reliability,” says Mohammed Akoojee, the boss of Imperial, which last year bought a stake in Lori. His clients would rather pay more to know that their goods will arrive on time than for journeys to be cheaper and late. Imperial hopes to use Lori’s software to develop spot markets for freight.

The deal is part of a broader trend of consolidation in African logistics. This month DP World, a Dubai-based port operator, bought Imperial, which should create a ship-to-shop company across much of Africa. Last year DP World and CDC Group teamed up to develop African ports, including in Egypt, Senegal and Somaliland. Another firm, Arise Ports & Logistics, incorporated in 2020, is partly owned by an investment fund affiliated with Maersk, a Danish shipping giant, and Olam, a Singaporean trader. And Chinese entities are involved in the running or building of at least 46 ports in sub-Saharan Africa, according to CSIS, an American think-tank.

Logistics firms, as well as the businesses with goods to move, hope that the long-mooted idea of “trade corridors” will come to fruition. These are a mix of hard and soft infrastructure linking countries. Corridors would allow a container sealed in Shanghai to reach Lagos or Mombasa, with its paperwork all approved for it to travel right on to, say, Niger or Uganda.

The AfCFTA is meant to encourage such trade-easing efforts. This year it helped start a scheme to allow traders in one country to pay for goods in another using their domestic currency, rather than dollars, thus cutting foreign-exchange costs. But in general progress has been slow. Though the AfCFTA has had more launches than NASA, no trade has actually happened under the terms of the deal. “There is a lack of urgency,” says David Luke of the London School of Economics (LSE).

The current stumbling block is over rules of origin, the foundations of any trading area. In contrast to the EU, where large countries such as Germany and (pre-Brexit) Britain were advocates of liberalisation, Africa’s largest economies—Egypt, Nigeria, South Africa and, to a slightly lesser extent, Kenya—are all run by governments with protectionist leanings. Outsiders do not help either: the EU has many different types of trade deals with African countries, making it harder for those countries to harmonise their own rules.

Disputes between countries can clog up trade for months. Rwanda and Uganda closed their border for three years, only opening it recently. For most of last year Kenya banned imports of Ugandan chicken and eggs because its farmers complained about their neighbours’ prodigiously productive poultry. In 2020 a dispute between transport unions in the Gambia and Senegal made it difficult to get goods from Banjul to Dakar. And so on.

Stalled talks over rules of origin have also stopped progress on other issues. Many countries still rely on paper customs forms. Few border crossings have “one-stop windows”. Truckers need to queue separately for immigration, customs, car tax and covid tests. Such things add to the costs of getting things across borders; it is $2,000 to ship a container from China to Beira in Mozambique, but a further $5,000 to ship it 500km inland to Malawi.

The political obstacles within countries can be just as tough as those between them. Overhauling ports and border posts is difficult partly because of vested interests. African states often rely heavily on customs duties to fill their state coffers, a practice going back to the extractive model of colonial regimes. An individual inspector at the port of Toamasina in Madagascar, for instance, is responsible for collecting 1.3% of all taxes in the whole country.

Such power opens the door to rent-seeking and corruption. Sandra Sequeira and Simeon Djankov, both of the LSE, found that about 15 years ago more than half of shipments going through Maputo, and more than a third via Durban, involved bribes. Digitisation and higher wages do not seem to reduce corruption. When Ghana raised salaries for police controlling borders, bribe-taking increased.

Businesses are far from blameless, adds Gaël Raballand of the World Bank. Powerful oligopolies can collude in corruption, whether to get their goods moving or, as odd as it may seem, to keep them in port—a way to raise the costs of entry for would-be competitors, notes Mr Raballand.

“The problem is still at the borders,” grumbles a Kenyan fleet owner. Even if drivers send paperwork in advance, they can still wait behind others who do not. “We pay for drivers to skip the lines. You have to. This is Africa.” ■

Springtime for Bashar

Syria’s outcast dictator returns to the Arab world

BASHAR AL-ASSAD has few occasions to fish out his passport. The Syrian tyrant has been largely confined to his own country since 2011, when he set out to crush a string of peaceful protests calling for reform. As civic unrest turned into civil war, he became a pariah. His few foreign forays have been to Russia and Iran, wartime allies to whom he owes his survival.

On March 18th Mr Assad emerged from isolation. He landed in the United Arab Emirates (UAE) for the sort of visit afforded to any head of state. There was an honour guard and a series of meetings with bigwigs. State media in the UAE published photos of Mr Assad with Muhammad bin Zayed of Abu Dhabi (pictured above), the country’s de facto ruler, and grinning with the leader of Dubai, the flashiest Emirate.

Mr Assad’s first trip to an Arab country since 2011 was both predictable and shocking. Predictable, because the UAE has spent years pursuing a rapprochement with him. In 2018 it reopened its embassy in Syria, which (like many others) was shut in the uprising’s early days. Abdullah bin Zayed, the Emirati foreign minister, flew to Damascus last year and met Mr Assad. The Emiratis had long been less eager than many of their partners to defenestrate Syria’s dictator. They had feared that regime change in Syria would bring Islamists, whom they abhor, to power.

It was the timing that shocked. March 18th was the 11th anniversary of the first Friday protest in the southern city of Deraa, a date many Syrians see as the start of their revolution. The symbolism was not lost on them. The visit also came as Russia waged war in Ukraine, using tactics honed over seven years backing Mr Assad. Syria was one of five countries to vote against a UN resolution damning Russia’s invasion.

The UAE feels that isolating Mr Assad has not worked: making him a pariah not only failed to depose him but left him reliant on Iran. Russia has been a bulwark against Iranian hegemony in Syria, but, with its army tied down in Ukraine and its economy hobbled by sanctions, its influence there is likely to ebb. Emiratis argue that they (and other Arab states) should fill the void. “The terrain changes, and we have to adapt to the new terrain,” says a foreign-policy official. The UAE has called for Syria to be reinstated in the Arab League, from which it was suspended in 2011.

Western powers are not happy. Their policy remains to isolate the man whose war killed perhaps 500,000 people and displaced 13m. Asked if giving Mr Assad a warm welcome helps bolster his regime, Emiratis respond with a list of Western failings in Syria, chief among them Barack Obama’s decision in 2013 to ignore his own “red line” against Mr Assad’s use of chemical weapons. That he remains in power, they argue, is a choice at least partly of the West’s own making.

That charge is not meritless. Western governments called for Mr Assad’s ouster in 2011, but their support for the rebels trying to eject him was half-hearted. Painful sanctions imposed by America and Europe have not compelled Mr Assad to change. Some anti-regime Syrians now argue that they only deepen the country’s misery.

If the Emiratis can explain why they welcomed Mr Assad, however, they struggle to articulate what their welcome might achieve. He wants trade and aid to rebuild his shattered country. Much of Syria looks like a terrible place to invest in, but a few projects could be lucrative for Emirati firms. DP World, the Dubai ports giant, is keen to invest in Tartous, a Mediterranean harbour in a relatively calm part of Syria.

Whether that will buy Mr Assad’s favour is another matter. Like his father Hafez, who ruled from 1971 to 2000, he is adept at playing off Iran and Arab states against each other. The Syrian regime has no love for Gulf rulers: Assad fils once called them “half men” for their failure to support Hizbullah, the Lebanese Shia militia, during its war against Israel in 2006. There is no reason to trust that a pot of reconstruction aid will persuade Mr Assad to toss out his Iranian saviours, or that his corrupt, vicious dictatorship will be a force for stability in the Levant.

In decades past it would have been difficult to imagine a Gulf state breaking so publicly with its American protector. But the UAE, like several of its neighbours, has grown exasperated with America. It is not that the latter is leaving the region. Tens of thousands of American troops are still deployed in Iraq, Syria and the Gulf. After an Iranian-backed group fired missiles and drones at Abu Dhabi in January, America sent a squadron of F-22 fighters and a guided-missile destroyer to the UAE.

Sorry, snoozy Uncle Sam

America is not absent, but it seems incoherent. It wanted Mr Assad gone but allowed him to stay. Its Iran policy does an about-face every four years. President Joe Biden vowed to make Saudi Arabia a “pariah”, until he needed its help to lower oil prices; both the Saudi and Emirati crown princes now duck his phone calls. The UAE feels little need to follow America’s line when it seems so meandering.

Three days after his embrace with the Syrian dictator, Prince Muhammad flew to Sharm el-Sheikh to meet the Israeli and Egyptian leaders, his first such tripartite meeting. This surprise summit touched on everything from food prices to Iran’s nuclear programme. All three participants are close to America, yet all three have sharp disagreements with it. Syria is a case in point. Abdel-Fattah al-Sisi, Egypt’s president, restored ties with Mr Assad soon after he took power in 2014. Many Israeli security people opposed Mr Assad’s ouster, fearing a failed state on their border. America may complain about their positions on Syria and other issues. But its Arab allies feel ever less need to listen. ■

The sands they are a-swirling

Morocco scents victory in Western Sahara

THE BATTLE over Western Sahara has long felt as sluggish as the region’s barely shifting sand dunes. It is almost half a century since Morocco claimed sovereignty over the slice of desert, previously a Spanish possession, that runs 900km (560 miles) along the Atlantic coast, south of Morocco proper. The Polisario Front, an indigenous guerrilla group backed by Morocco’s rival, Algeria, is still fighting for independence. For several decades the rest of the world has looked away, parking the dispute with the UN and promising the mirage of a referendum on self-determination to settle the issue. In fact, it has been frozen in the baking desert, seemingly for ever. But of late the sands have been swirling.

On March 18th Spain abandoned its long-held neutrality and tilted in favour of Morocco. Its prime minister called Morocco’s plan to give the Saharans autonomy within the kingdom “the most serious, realistic and credible”. The EU gave a cautious thumbs-up to Morocco, too. (The Americans had already recognised the kingdom’s claim in the last days of Donald Trump’s presidency.) Morocco cheered the latest shift. Algeria fumed.

Morocco’s diplomatic success is partly thanks to its mischief-making. In the past year it has repeatedly let migrants from Morocco and elsewhere in Africa pour into Spain’s north African enclaves, Ceuta and Melilla, upping illegal migration into Spain by 40%. A BBC poll of young Moroccans in 2019 suggested that 70% wanted to emigrate—and that was before the rains failed, tourism slumped under covid-19 and the prices of basics like flour soared after Russia invaded Ukraine. In addition, Morocco, seizing a chance to squeeze Europeans harder, reduced intelligence co-operation, boycotted Spanish ports and exports, and withdrew its ambassadors from several European countries. Once a bulwark of pro-Western solidarity in forums such as the UN, this month it failed to vote when the UN General Assembly castigated Russia over Ukraine.

Polisario, meanwhile, is drooping. Its forces have been hammered. Israel has aided Morocco militarily, passing on tanks seized in wars with other Arab armies and helping build a defensive wall through the Sahara modelled on its Sinai fortifications. Its supply of combat drones, soon to be made in Morocco, has turned the tables on Polisario and its backer, Algeria.

The energy crisis should have given Algeria some leverage. It is southern Europe’s closest big source of hydrocarbons. Pipelines link it to Spain and Italy. Europeans worry that Russia may use its influence in Algeria and eastern Libya to gain control over supplies to southern as well as eastern Europe. But Algeria is in a bind. It needs European revenue and Western finance to expand production. And its ageing generals are paralysed by infighting. Algeria recalled its ambassador from Spain, while Morocco’s returned to her post.

Still, the struggle is not over. Spain stopped short of fully recognising the kingdom’s sovereignty over Western Sahara. Though Morocco has agreed to stop the flow of migrants for now, relations with Spain are still dogged by rows over Morocco’s port expansion along its Mediterranean coast and the pittance the EU pays Morocco for fishing off its Atlantic coast.

Meanwhile the kingdom continues to create “facts on the ground”. Its settlers now outnumber local Saharans three to one. Officials from the north often get the best land. A motorway will soon run south to the border with Mauritania. The Moroccans hope that the huge port they are building at Dakhla, the territory’s second city, will enhance trade with sub-Saharan Africa, while cables may bring energy from solar and wind farms to Europe. And if pesky locals still demand independence? One of Dakhla’s largest new developments is a towering prison on the edge of town. ■

The resilience of rhinoplasty

Plastic surgeons make a bundle despite Lebanon’s economic crisis

RHINOPLASTY HAS long been a rite of passage in Lebanon. Teenage girls want a dainty new nose in time for their graduation parties, celebrated in selfies. Lebanon’s many woes have not hindered the habit. Plastic surgeons are apparently making as much as or more than they did before an economic crisis, starting in 2019, that the World Bank has ranked as the third-worst anywhere, ever.

The World Health Organisation reckons that Lebanon’s economic meltdown prompted nearly 40% of the country’s doctors to leave. But for those who have stayed, the pickings, especially for nose jobs, may have increased. The pool of patients has stayed the same. There are fewer dexterous doctors to paddle in it.

If fewer Lebanese can afford cosmetic surgery, the gap has been filled by patients from abroad. Mostly of Lebanese descent, they provide 70% of the country’s bidders for beauty, reckons Chadi Murr, a plastic surgeon. That is a notably higher share than before the financial crisis, he says.

Beautifying a beak in Beirut is cheaper than in the West. The average Lebanese nose job costs $2,500, less than half the going rate in America. And while the hooter recovers, customers can visit grandparents and cousins. Some say that Lebanon’s diaspora is 15m-strong, twice as big as the beleaguered country’s resident population.

Lebanon’s beauty aficionados are a resilient and resourceful lot. When angry protesters blocked the roads in 2019, hoping to get rid of Lebanon’s government, those bent on cosmetic improvements simply headed for the clinic on foot. While the country lamented a lack of basic medicines, plastic surgeons stocked up on Botox and flesh-fillers. With the electricity supply regularly conking out, Saad Dibo, a plastic surgeon, moved stock into his flat, where his own generator kept the fridges cool.

For about half a year after an explosion in the port of Beirut killed more than 200 people in 2020, many visitors were afraid to come, says Dr Murr. Locals were “not in the mood” for nips and tucks either, he admits. His practice languished. But soon he was busy treating scars and burns from the blast.

“It’s weird” how well his business has managed, he concedes. Bleaker times may return, so he has opened a surgery in Cyprus, where he spends one week in eight. In a country so disaster-prone, you need a fallback. But as long as Lebanese ladies like to tweak their noses, Beirut’s beauty business seems likely to survive.

Europe

• War in Ukraine: The concert of Europe

The concert of Europe

The EU’s unity over Ukraine has given it surprising heft

IT MAY BE called the European Union, but it has often struggled to live up to its name. Not in recent weeks. Ever since the invasion of Ukraine by Russia on February 24th, the 27 member states of the EU have acted as one. Cohesive in its aims and co-ordinated in its actions, Europe has basked in its novel role as a first-rate power. Yet the unifying effects of the original jolt are starting to wear off. Ukraine’s demand that Europe should now do much more to help it is an early test of whether it can stay united as the war grinds on.

The speed and determination with which Europe initially acted startled even old hands in Brussels. Previous crises—whether the euro-zone miasma a decade ago or the bloc’s response to covid-19—had shown it could take months if not years for the union to work effectively. The sight of Russian bombs slaughtering civilians on the bloc’s doorstep, in contrast, shocked the EU into action.

Differences of emphasis remain, inevitable in a club of democracies. But repeated meetings of leaders—the third in a month was under way on March 24th as The Economist went to press, with America’s President Joe Biden in attendance—have resulted in Europe making decision upon momentous decision. Funds were found to supply arms to Ukraine. Any Ukrainian seeking safe haven in the EU can walk in. Perhaps most important, tough sanctions were agreed as war broke out. Given that neither America nor Europe is willing to intervene militarily, this was to be the main tool. Few had expected much, given that any of the 27 member states could have vetoed sanctions.

Europe reached consensus, rather than total agreement, before moving forward. Unity was forged despite divisions over how tightly to isolate Russia. “Sanctionistas” have pushed for a stricter embargo, including a ban on importing oil and gas. Countries such as Poland and the Baltic states worry that Russia might attack them next; they say they would be willing to live by candlelight if it means stopping money flowing to Moscow. A more hesitant bloc, including Germany and Italy, has been more reluctant to cut off the Russian energy supplies they depend on.

In part thanks to outraged public opinion, the hesitant group found themselves swept along into tougher measures than anyone had thought feasible—though still falling short of an energy embargo. Sergei Lavrov, Russia’s foreign minister, this week admitted the extent of the measures had taken the Kremlin by surprise.

But the old divisions linger. Poland is calling for a total ban on trade with Russia. Germany remains firmly opposed to doing more. “Sanctions should not hurt European states harder than the Russian leadership,” said Chancellor Olaf Scholz on March 23rd. (As often happens in EU debates, other countries agree but are glad not to have to make the case in public.) A familiar sense of gridlock now looms.

As a result Ukrainians who once lauded the benefits of European unity are now questioning it. “What we saw in the beginning of the war was the rise of the European Union as a powerful player that can bring change,” says Dmytro Kuleba, Ukraine’s foreign minister. “What I see in the last ten days in the European Union is backsliding back to its normality where it cannot decide on strong and swift action.”

Mr Kuleba, speaking to The Economist from an unspecified location in Ukraine, sees early signs of “sanctions fatigue” in Europe. Some of the measures agreed upon look less effective now that loopholes have been found. The freezing of Russian central-bank reserves held overseas, for example, has come with carve-outs that have allowed Russia to continue servicing its debt and stave off technical default.

There are other bones of contention. Ukraine has applied for EU membership. Eastern countries are keen to let it in. But founding members such as France and Germany have insisted that the bloc offer only woolly assurances about Ukraine being in “the European family”.

The EU could yet be forced into more sanctions—if Russia used chemical weapons, say, or committed some other battlefield outrage. Member states, and the bloc as a whole, are working to get arms to Ukraine (Mr Kuleba, unsurprisingly, would like more and faster). Regardless of how the war evolves, the security situation in Europe is likely to remain tense. Hence all sides are doing what they can to defuse fights that could sour the mood of unity.

Some will need answers soon. More than 3m Ukrainians have already sought refuge in the EU, for example. Nearly two-thirds of them are in Poland, which will struggle to cope. A smaller influx of Syrian and Afghan refugees caused long and bitter spats in 2015. This time Poland will receive help, one way or another.

Other disagreements are bubbling up. Many are about money, made worse by sagging economic prospects. France was among those suggesting that the cost of sanctions and stronger defence should be met through a joint fund of the sort the EU raised to deal with covid-19; “frugal” northerners are sceptical. At some point a fight will occur about when to reinstate austere EU budget rules suspended during the pandemic. Poland is demanding the release of EU funds withheld over concerns it has hobbled its judiciary. Many national capitals are keen to uphold “rule of law” principles, war or no war.

Long-standing policies that seemed settled may be seen in a new light after the war. Can Europe afford to cut carbon emissions so rapidly, given the war’s shock to energy supplies? France is keen to push its idea of “strategic autonomy”, a nebulous concept that includes Europe relying less on NATO for its defence. Eastern Europe still views the alliance, and thus America, as the guardian of its borders.

Mr Kuleba’s frustration that fresh waves of European sanctions are not forthcoming is understandable. But the disagreements at the heart of the EU today reflect legitimate differences of opinion, not pointless squabbling. Europe’s spurt of unity gave it a hard-power relevance it has rarely enjoyed. One month into the war, the union has served its purpose well. But it must now strive to do more. ■

Read more of our recent coverage of the Ukraine crisis

Seeds of discontent

Voters seek an alternative to Macron in blighted France

THE LAST pit in this northern French village closed in 1974, but the silhouettes of its slag heaps still rise in the distance across flat farmland. They bear witness to the muscular past of the mining basin, which a century ago employed 130,000 people. Today its jobless rate is ten points above the national average, and one in five of its people live below the French poverty line of €1,100 ($1,200) a month. Once a week Ma P’tite Epice Rit, a voluntary food truck, stops by the church in Auchy-les-Mines to sell discounted food near its expiry date to those living on less than €10 net a day. The truck serves some 100 residents. “People here are asphyxiated by daily life,” says a local shopkeeper.

Bypassed by high-speed trains and breezy ambition, Auchy belongs to what analysts call “peripheral” France. Peggy Belicki, who a year ago set up the food truck, filled with apples, potatoes, cabbages and chocolate tarts, says she caters to all sorts, from pensioners to single parents: “We offer a sort of moral-support service.” For years, this working-class town looked to the Communist Party to supply social assistance and ideological answers. The mayor, Jean-Michel Legrand, is from the Communist Party, as were his predecessors reaching back over half a century.

Yet in 2017, at the previous presidential election, the nationalist-populist Marine Le Pen topped first-round voting in Auchy. In the run-off, 65% of its voters backed her; just 35% backed Emmanuel Macron. Ahead of the two-round election on April 10th and 24th, polls say she is the most popular choice for blue-collar voters nationally, and again the most likely to face Mr Macron in the run-off. Promising to keep out immigrants and ease the cost of living, Ms Le Pen has built a stronghold in the northern rustbelt, especially among voters who once leaned to the far left. She represents a northern seat in parliament. And, since 2014, her party has run the town hall in nearby Hénin-Beaumont, where this week she took her campaign bus.

Other candidates are also tapping into the yearning in blighted corners like this for an alternative to the sitting president. One is Jean-Luc Mélenchon, a razor-tongued 70-year-old from the hard left who is on his third presidential run. He came second in first-round voting in the village in 2017. Another is Eric Zemmour, a far-right polemicist whose latest wheeze is “re migration” to send 1m immigrants “home”.

On a recent weekday, Emmanuelle Danjou, a sales manager, was slipping leaflets for Mr Zemmour into letter boxes on an estate of neat two-storey homes. His programme “is really focused on a reconquest of our country. We’ve lost our values; we’re dismantling our country, our history”, she says; “He says out loud what many French people think in private.” Frédéric Dewitte, from a nearby village, joins her leafleting. He used to back Ms Le Pen but now finds her “too left-wing”, and not Eurosceptic enough. Mr Zemmour, he says, is a “man of culture” who could “possibly save France”.

Dislike of Mr Macron is not universal in Auchy. “Excusez-moi, he hasn’t had an easy task,” says a 70-year-old standing in his garden in plastic slippers. On the high street, where the “Best Kebab” joint sits near a boarded-up insurance agency, another man agrees that it is “unfair” to judge the president too harshly, what with the pandemic and war in Ukraine. Yet there is little love for him. He “values globalisation and Europe more than France”, declares Mr Dewitte. Many locals think he has governed for the rich, not for people like them.

This matters for Mr Macron. Not because he needs their votes: polls suggest that he would easily beat any potential rival in the run-off. But if he is re-elected, Mr Macron will have to govern a discontented and volatile country which readily takes its unhappiness to the streets. Some of his campaign proposals, unveiled on March 17th, would be vigorously contested, notably his promise to raise the pension age from 62 to 65. Mr Macron may be well placed to win the presidency, and possibly even a new majority at parliamentary elections in June. But, as Auchy-les-Mines suggests, governing a fractured France may be even harder the second time around. ■

For more coverage of the French election, visit our dedicated hub

From the third Rome to the second

Istanbul has become a refuge for thousands of Russians escaping Putin

ARSENY, A FASHION photographer, and his boyfriend Vova, a film director, woke up in Moscow on the day Russia invaded Ukraine and realised their country had reached a point of no return. “We had been living a lie,” Arseny says. A few days later, after seeing the streets choked with riot police, they boarded a plane to Istanbul. They and many of their fellow passengers had decided to leave Russia, with little hope of return.

Turkey’s biggest city has been a favourite among Russian tourists for decades. It has now become a temporary haven for Russians escaping Vladimir Putin’s dictatorship. They have few other places to go. All EU countries have banned flights from Russia. Turkey has not, and lets Russians in without a visa.

At least 14,000 Russians are estimated to have moved to Turkey since the war started, according to Turkish media. Most are young professionals: lawyers, bankers, journalists, programmers and artists. Hundreds turned up at a recent anti-war benefit concert by Miron Fyodorov, otherwise known as Oxxxymiron, a Russian rapper. On Telegram, a messaging app, the newcomers are exchanging tips on setting up Turkish bank accounts and applying for permanent residence.

They are following a path beaten by Russian exiles a century ago. In the 1920s some 200,000 Russians, Ukrainians, Azeris and Georgians fleeing Bolshevik rule reached Istanbul on crowded steamships. They included White Russian aristocrats, the novelist Vladimir Nabokov, and Fyodor Fyodorovich Tomas, a black impresario born in Mississippi who had run a music club in Moscow and who went on to introduce Istanbul to jazz. A visiting French princess spotted a Russian baron polishing shoes and recognised a waitress as a fellow princess she had seen at a ball in St Petersburg.

In the 1920s nearly all the émigrés moved on to Europe. Most of the new ones do not plan to stick around either. Arseny has applied for an American visa, Vova for a German one. But as long as Mr Putin wages war on Ukraine and on anyone who opposes his invasion, Istanbul will remain a way-station for many of Russia’s best and brightest.

Io, robot

Italy’s digitisation minister has big goals and a big budget

THE HOMELAND of Galileo and Marconi has proved unexpectedly resistant to digital technology. Many Italians adopted mobile phones while they were still a rarity in other countries, including America. Yet the share who regularly use the internet is no higher than in Turkey.

That partly reflects Italy’s elderly population: it has the EU’s highest median age. But Riccardo Luna, formerly his country’s representative in the European Commission’s Digital Champions Expert Group, says other factors have also played a role. For eight of the ten years from 2001 to 2011, Italy’s prime minister was Silvio Berlusconi, a TV magnate for whom the internet represented a commercial danger. Telecom Italia, the country’s dominant land line operator, had an interest in slowing the introduction of broadband to maintain the value of its main asset, a copper cable network. In 2020 the share of Italian adults who had used the internet in the previous three months was just 78%—the second-lowest in the EU.

The man charged with changing that is Vittorio Colao, once the boss of Vodafone. Last year Mario Draghi, the prime minister, recruited Mr Colao to be his minister for digital transition. Thanks to the EU’s colossal post-pandemic recovery fund, Mr Colao has more than €40bn ($44bn) to work with. One goal is to help industry digitise. Another is to bring extra-fast broadband to schools and health clinics, as well as providing broadband and 5 G mobile networks to remote areas. Mr Colao also wants to help the 3m or so Italians who have been left behind by the digital revolution acquire basic computer skills, and to streamline public access to government, largely through smartphone apps.

In that realm, Italy has made impressive progress. Matteo Renzi, a techno-evangelist who was prime minister in 2014-16, launched several projects that have been implemented under his successors. Mr Colao flourishes his smartphone and points to an app called Io (“I”): “I can now pay my social-security contributions for my domestic help directly from this. I showed it to a German politician. He was open-mouthed with astonishment.”

Io and a clutch of similar apps appeared just as covid-19 was spreading in Italy, confining Italians to their homes and encouraging them to become more digitally savvy. The pandemic has helped in other ways too. “We were not a nation of e-shoppers,” says Mr Colao. “And yet [e-commerce] has now become absolutely normal.”

One of his biggest challenges, he says, is convincing businesspeople to invest in digital initiatives. The other is getting officials to integrate systems and harmonise procedures. Digitisation in the public sector has been haphazard. There are an estimated 11,000 databases spread across national, regional, provincial and municipal government. “We spend our time arguing with other ministries and local authorities,” says Mr Colao. “Digital does not need to be centralised, but it does need to be homogenous.”

The rewards are potentially immense. Two of the biggest reasons why the Italian economy has stagnated since the turn of the century have been low productivity and a stubbornly inefficient bureaucracy. Tens of billions of euros will help to tackle both. As Mr Colao admits, ensuring they are spent wisely can be frustrating. “But I always say that if I weren’t frustrated I wouldn’t be doing my job.” ■

Charlemagne

Weaning Europe off Russian energy will mean making changes

AT LAST, the spring. For months Europeans have lived with the threat of losing the Russian gas that keeps their homes warm. The prospect seems less daunting now that daffodils are blooming. But despite the seasonal serenity, a wrenching energy transition is under way. Europe wants to cut imports of gas from Russia by two-thirds within a year. Behind the scenes, politicians and companies are already scrambling to work out how to cope next winter. The obvious upshot, one might expect, would be a change in consumer behaviour not seen since the 1970s, when dizzying oil prices caused a rethink of how the West lived. Not so. While European leaders exude an air of war-time concern, the public is living as if nothing were amiss in a continent at peace.

Energy prices, whether of petrol, gas or electricity, have rocketed in Europe. Some people might barely have noticed. In France, the authorities have essentially capped electricity and gas bills. Italy on March 18th added €4.4bn ($4.8bn) in subsidies to limit power-price rises for companies and consumers, on top of the €16bn already agreed in recent months. Several countries have cut petrol duties, a much-needed source of tax income. European leaders meeting in Brussels as The Economist went to press were due to discuss new state largesse to households and industry. This is the “whatever it takes” approach at work. As with covid-19, government is paying first and will ask questions later.

What is startling is how little is being asked of Europeans. Even simple measures that might barely inconvenience people are treated as taboo. Earlier this month the International Energy Agency (IEA), which advises rich-country governments, suggested that Europeans might consider turning down the thermostat by just one degree centigrade. What might seem like mere virtue-signalling greenery would actually cut consumption by 10bn cubic metres of natural gas over a year. That is roughly one month’s worth of Russian imports. This modest appeal was relayed by precisely nobody in office.

Some EU governments want to ban Russian oil, the Kremlin’s biggest money-spinner. Yet no one is seriously considering the obvious way of using less of it. Lowering motorway speed limits by 10kph would trim fuel use in the rich world by around 15%, not to be scoffed at when Europe is scrambling for any hydrocarbons it can get. Throw in subsidies to boost the use of public transport, a plea to work from home one day a week where possible and a ban on car use in cities on Sundays, and Europe could save perhaps a fifth of the Russian oil it imports, according to IEA figures and Charlemagne’s guesswork. These may or may not be sensible ideas. The point is that they are not being discussed.

Why is Europe not rediscovering the spirit of the 1970s? Back then the European public was expected to accept some discomfort and inconvenience. Speed limits went from the exception to the norm (except on German autobahns, of course). Dutch and German cities were among those that went pedestrian one day a week. France decreed public buildings should be no warmer than 20°C, two degrees lower than today’s European average. Television broadcasting was shut off at 11pm, an idea that could usefully be revived for social media. Daylight-saving schemes adopted during the world wars were soon revived across the continent. “Whatever it takes” involved people donning jumpers.

Lots of ideas to cut back energy use tomorrow are being mooted. But few Europeans are even being nudged to use less energy today. One reason may be that the rich world has changed in 50 years. Past crises have helped make modern economies more energy efficient. The current oil and gas shock is not so painful, especially since the world has become used to seesawing crude prices. But recent history outside Europe suggests that rapid change is possible. After Japan shut down its nuclear plants in the aftermath of the Fukushima disaster in 2011, a public-information campaign beseeched people to cut back energy use. Trains were slowed, air-conditioners were turned down and employers moved shifts to save power. A similar campaign is nowhere to be seen in Europe.

Keep cool

The absence of such measures reflects three factors. The first is that Europe may not truly be committed to weaning itself off Russian hydrocarbons. More storage of gas at EU level, as looks likely to be agreed, could dent Russia’s stranglehold on Europe. Some might think that will solve the problem, at least if the war ends soon. Keeping the option, if not the necessity, of importing Russian gas would avoid a painful pivot away from cheap power.

Second, energy is a politically toxic topic. The mere mention of speed limits or dearer petrol triggers accusations of urban politicians ignoring the plight of car-dependent provincial folk. Spanish farmers are protesting about energy prices. France’s president, Emmanuel Macron, wants no more gilets jaunes protests ahead of an election next month. Europe is on a glide path to “net zero” emissions, to which the Ukraine crisis has given fresh impetus. Sensible long-term policy might be derailed by rash short-term measures in reaction to transient (albeit traumatic) events.

The third, and most depressing, possibility is that politicians now think their electorates are incapable of sacrifice. Two years of pandemic-era nagging has tested the public enough. The end of covid-19 restrictions (if not the virus itself) was meant to presage a new Roaring Twenties. That is no time for hair-shirt preachiness. “A Europe that protects” is a recent Brussels mantra: citizens must not be inconvenienced by a changing world.

This is a shame. Ukrainians are daily making sacrifices on an extraordinary scale. A growing number of Europeans are opening their homes to them and making donations. The public mood in Europe is of defiance towards Vladimir Putin. Nobody needs a politician’s blessing to lower the thermostat or skip a flight. But it is depressing that none of them has even thought to ask. ■

Read more from Charlemagne, our columnist on European politics:

Europe is doing a good job helping refugees from Ukraine (Mar 12th)
With war at its doors, Europe discovers a capacity for action (Mar 5th)
Europe is the free-rider continent (Feb 26th)

Our recent coverage of the Ukraine crisis can be found here

Britain

• The public finances: Spring in his step

The spring statement

Rishi Sunak wants to be known as a tax-cutting chancellor

WITH BRITISH households facing a cost-of-living crunch, the “spring statement” on March 23rd, an occasion for the chancellor to course-correct between autumn budgets, offered several eye-catching giveaways. Fuel duty will be cut immediately. From July national insurance, a payroll tax, will kick in at a higher income threshold. And in 2024 the standard rate of income tax, paid by 30m Britons, will fall by one percentage point. As Rishi Sunak spoke at the despatch box, Conservatives brayed their support. But the measures add up to less than billed.

Alongside the spring statement came a new set of forecasts for the public finances, produced by the Office for Budget Responsibility (OBR), an official fiscal watchdog. Those supported the case for some kind of relief for hard-pressed households. Since October, when such figures were last published, inflation had increased by more than expected, eating into household budgets. As incomes fell behind rising prices, the OBR predicted that disposable income per person would fall by over 3% in real terms over the coming year, unless policies changed to mitigate the impact. That would have constituted the biggest annual drop since records began in 1956.

The worsening economic outlook has not pinched the public finances, however. Revenues from taxes on incomes and corporate profits have been buoyant. This is partly because in March 2021 Mr Sunak froze income-tax thresholds. Since then earnings have risen faster than expected in cash terms. The resulting fiscal drag means that more people are paying tax, and at higher rates. Last October the OBR expected that 0.9m more people would be caught by the higher 40% marginal rate in the 2023-24 fiscal year; it now thinks that 1.3m will.

As revenues have risen, public spending has not kept pace. Economic developments such as higher inflation have pushed up projected spending at the end of this parliament by only about two-thirds of the expected rise of £37bn in revenues. Most of that is higher benefits and debt-interest payments. (More than a fifth of government gilts are linked to the retail-price index, a measure of inflation.) A change to the terms for student loans announced in February will save around £5bn in the same year. Costs have also been contained by Mr Sunak’s refusal to increase the budgets of government departments beyond what was agreed last October, even though they will be pummelled by rising energy costs, just as households will. In times of high inflation, chancellors are able to make stiff spending cuts by stealth.

Had Mr Sunak chosen to do nothing, then, expected borrowing would have been about £20bn lower in 2024-25 than previously forecast. Instead he opted to cut taxes—compared with what had previously been pencilled in, that is. He soothed motorists upset about rising petrol prices by lowering fuel duty from £0.58 to £0.53 per litre. In three months’ time the threshold for starting to pay national-insurance contributions will be aligned with that for paying income tax—a welcome simplification and a political promise fulfilled. The marginal standard rate of income tax will fall from 20% to 19% in April 2024. The more immediate of these measures should offset around a third of the expected hit to incomes in the fiscal year starting in April 2022, limiting it to a drop of 2.2% (see chart 1).

The moves placated the right wing of the Conservative Party, which has fretted about Mr Sunak’s tax-and-spend ways, such as a big planned increase in the rate at which workers and employers pay national insurance, which is intended to help fund social and health care. But if what matters politically is the gap between voters’ incomes and outgoings, they should wait before cheering. In 2024 the fact that income-tax thresholds have been frozen for years will offset the gains of a lower income-tax rate for anyone earning less than £49,000 a year. More broadly, the policies revealed on March 23rd offset only around a sixth of previously announced increases in tax as a share of GDP between 2019-20 and 2026-27. Even after taking them into account, the tax take as a share of GDP is expected to increase by 3.3 percentage points, bringing it to 40.1% by the end of that period, the highest in four decades.

Mr Sunak will doubtless face further calls to keep shaving away at planned tax increases. But some caution is warranted when it comes to the public finances. Fallout from the conflict in Ukraine could start to erode tax revenues, if a sustained increase in energy prices drags down GDP. The OBR noted that a new vaccine-resistant strain of covid-19 could yet emerge, which could damage the economy and push borrowing higher.

The decision not to do more to soften the blow of rising living costs for the poorest voters is itself a gamble, however. Of every £3 in extra support the chancellor announced, £2 will go to the richest half of households, according to analysis by the Resolution Foundation, a think-tank (see chart 2). Households reliant on benefits will be pinched by incomes that increase by just 3.1%, even as inflation rips above 7%. The real value of benefits is expected to fall by £11bn in the coming year, meaning that an extra £500m in the Household Support Fund, a pot of money from central government that councils can use to help people who are struggling, will not go far.

Mr Sunak appeared resolute, making it clear that any further giveaways would go on lower taxes, not higher spending. He promised that this autumn he would increase incentives for business investment. Perhaps he is hoping to fight the next election (one is due in 2024) vindicated, and crowned the king of tax reliefs. But with such a large hit to incomes looming—and such big tax increases still to come—that seems optimistic. ■

All in a lather

Machines are once again doing the car-washing in Britain

WHAT WARM weather is to ice-cream vans and popcorn is to dentists, Saharan dust storms are to car washes. A big dust cloud like the one that reached Britain on March 16th boosts revenues by about a quarter, according to Kevin Pay of Wilcomatic, which runs about 800 automatic car washes in Britain. “You love to see it,” he says, as a dusty red Ford Ka joins the queue in Hove in East Sussex, on the south coast.

Until recently Britain’s drivers usually took their dirty motors to car parks and disused petrol stations, where eastern European immigrants had at them with sponges. In 2018 a parliamentary committee was informed that Britain had 10,000-20,000 hand car washes, compared with 2,000 automatic “rollover” machines and about 4,000 do-it-yourself jet washes. Hand car washes were more convenient—drivers simply handed money through the window rather than traipsing into a petrol station to buy a six-digit code—and often cheaper than machines. The industry was a rare example of de-automation.

It is now re-automating. Mr Pay says that Wilcomatic’s car-washing revenues in 2021 were 15% higher than in 2019, before covid-19 arrived. “It’s starting to turn,” agrees Chris Scott of Istobal, another car-washing firm, who says that sales of the chemicals used by machines are higher than they were before the pandemic. At Parkfoot Garage in Kent, David Charman says his four jet washes have been “absolutely flat out” since the dust storm. He has acquired another car-wash site and is seeking a third.

Automatic car washes and jet washes have improved, with contactless payment, superior brushes and theatrical foam. But the main reason for their popularity is that hand car washes are disappearing. The informal ones can be lousy employers: in 2016 a study of Leicester by two academics, Ian Clark and Trevor Colling, found that many paid less than the legal minimum wage. Car washing is a typical first job for an unskilled immigrant. And Brexit means that Britain has fewer newly arrived unskilled immigrants these days.

Covid-19 further tilted the market towards machines. The government shut down hand car washes for longer than automated ones, on the ground that they posed a higher infection risk. The pandemic also discouraged drivers (and everyone else) from paying with cash. That hurt informal car washes, which love cash in part because it allows them to dodge tax.

Alexander Russell of the Car Wash Association, a trade group, says that the industry has gone in a circle. Some petrol stations are now putting automatic car-washing machines into bays that were originally built for them, but were then occupied by hand car washes. Car washing has been in a lather, but it is emerging cleaner.

Prayers answered

Hong Kongers are boosting Britain’s church numbers

WHEN INHABITANTS of Sutton, then a parish of Surrey, gathered for the opening of Trinity Wesleyan Church in 1907, they surely never imagined that a century later its pews would be filled by colonial subjects from the Far East. They would have been baffled by sermons in a strange tongue, and texts in a foreign script. But “everything is guided by God”, says Jimmy, one of the new worshippers. “He led us to settle down here.”

Jimmy is one of around 300 Hong Kongers who have recently joined the Sutton Hongkongers′ Fellowship, which worships at what is now called Trinity Church Sutton. Last year nearly 100,000 visas were granted for the British National Overseas (BNO) immigration route for residents of the territory opened in January 2021. Sutton, now a London suburb, has been a popular destination: Hong Kongers are attracted by the low crime rates and local schools. Although only 16% of Hong Kongers are Christians, the share among BNO arrivals seems to be higher. One survey by UKHK, a faith-based project set up to welcome them, suggests that nearly half are Christians, mostly Protestants (the sample, reached via UKHK’s website, may have been biased towards believers).

The new arrivals have been a boon for Britain’s churches, which were struggling to recruit new members. Between 2009 and 2019 attendance at Church of England services fell by 15-20%. But most Cantonese-speaking congregations in Britain doubled or trebled in size last year, according to the Chinese Overseas Christian Mission, a charity based in Milton Keynes. One congregation, the Manchester Chinese Alliance Church, has quadrupled in size to 600 worshippers.

Christians are particularly likely to feel persecuted in Hong Kong. Although there is still more religious freedom than in mainland China, restrictions on worship are only likely to tighten. Many Christians were vocal in support of the pro-democracy movement that preceded the Chinese Communist Party’s crackdown on the city. After the introduction in June 2020 of a draconian national-security law, which has been used to punish people retrospectively for their involvement in the pro-democracy protests, they feared that they would be in trouble, says Richard Choi, a community organiser in Sutton.

Churches are hoping that their embrace of Hong Kongers can make the new arrivals feel more welcome than previous cohorts of immigrants. UKHK has worked with hundreds of churches to help make them “Hong Kong ready”, for example by recruiting Cantonese-speaking volunteers. This was in part motivated by a desire not to repeat the “terrible job” that churches did in welcoming the Windrush generation—people from the Caribbean who came to Britain from the late 1940s—says Krish Kandiah, UKHK’s director. The influx of former colonial subjects from Hong Kong was a chance to ensure that, when it came to offering help, Christians would be “at the front of the queue”.

That help has manifested in various ways. Trinity Church now holds services in Cantonese once a fortnight; nearby Hope Church is offering English-language lessons specifically for Hong Kongers. Segregated services mean that the Trinity worshippers have yet to integrate fully with the wider Christian community. But services in their own tongue are much needed, says Stephen Lam, another Trinity member who arrived from Hong Kong last year. “You use your heart’s language to pray.” ■

Correction (March 28th, 2022): An earlier version of this article said that the Hong Kongers were part of Trinity Church Sutton. In fact they are part of a new fellowship that worships at Trinity Church.

Close quarters

Anti-infection measures kept British prisoners safe during the pandemic

WHEN COVID hit, Britain’s ageing prisons could have been sites of mass infection and death. Many of the 118 in England and Wales were built during the Victorian era and are poorly ventilated. Seventy-two were holding more prisoners than their theoretical maximum capacity. Prisoners were often doubled up in cells meant for one—typically three metres by two metres. A trend towards longer sentences meant a growing number of inmates were older, and therefore more at risk of severe illness. Officials estimated that without rigid anti-infection measures, most of the 83,000 they held might catch the disease, and more than 2,000 could die.

Prisons immediately locked down. For the early months of the pandemic, prisoners spent an average of 22 and a half hours per day in their cells. Gym sessions, in-person education, worship and libraries were halted. Family visits were suspended.

As far as limiting infections and deaths was concerned, the lockdowns worked. The most recent figures, published in February, show that only 189 prisoners died for reasons related to covid. Over 35,000 had tested positive. But even as Britain re-opens, prisoners’ lives are not back to their pre-pandemic normal. In some facilities, says Charlie Taylor, Chief Inspector of Prisons, they are still in their cells for up to 22 hours each day.

The Ministry of Justice now permits prisons to remove all but the least intrusive covid restrictions—quarantining new arrivals, separating the most vulnerable inmates from the rest of the population and limiting mixing in large groups. But by March 7th just two adult prisons had done so. The rest were still operating restrictions that complicated access to education, gyms, worship, libraries or family visits, either because some facilities were closed or because of limits on how many prisoners could use them at one time.

Many prisoners without a cellmate have just spent two years in de facto solitary confinement. The harm done to mental health can be permanent after just two weeks locked up alone, says Peter Dawson of the Prison Reform Trust, a campaigning charity. And the continuing restrictions make it less likely that prisoners will receive family visits, which are known to reduce recidivism. According to research by the Ministry of Justice, prisoners who are visited by their family are 39% less likely to offend again.

Many prisons installed in-cell telephones and provided video calls for inmates during the pandemic—both welcome upgrades. But they are no substitute for an in-person visit, says Mr Taylor. And where restrictions make visits more inconvenient—some prisons allow them only on weekdays, when working family members or schoolchildren cannot come—prisoners have missed out. A troubling pattern is developing of visitor slots going empty, says Mr Taylor, possibly because of inconvenience or because families have lost the habit of visiting.

Austerity measures under the coalition government of 2010-15 saw the number of prison staff fall from nearly 25,000 to a total of just 18,000. That has since rebounded to just over 22,000. But the number will have to rise further if prison life is to return to something closer to normal. Moving prisoners around in smaller groups requires extra supervision, as does keeping gyms, libraries and chapels open for longer so that anti-crowding measures do not reduce access overall.

Another difficulty is high staff turnover. Nearly a third of officers have less than three years’ experience, and a substantial number have never worked in a prison without covid restrictions. A report from the prisons inspectorate in September 2021 on Wandsworth Prison found that a quarter of officers had been there for less than a year. The facility was so short-staffed and prisoners allowed so briefly out of their cells that they needed to choose between showering, ordering necessities and getting some exercise.

The Ministry of Justice has launched a recruiting scheme at short-staffed sites. But on top of high turnover and continuing covid restrictions, a further problem is that the prison population is expected to rise—to 98,500 by 2026, according to official predictions. As criminal trials came to a halt during the pandemic, the flow of new prisoners slowed and the total behind bars fell: in February it stood at around 80,000. Courts are now working through a massive backlog in hearings, which is sure to lead to more custodial sentences. A government plan to hire 20,000 new police officers may also lead to an increase in criminal charges—and convictions. ■

Dig deeper

All our stories relating to the pandemic can be found on our coronavirus hub. You can also find trackers showing the global roll-out of vaccines, excess deaths by country and the virus’s spread across Europe.

Copy, paste, repeat

Britain’s next nuclear plant will be identical to one under construction

BRITAIN’S FIRST new nuclear plant in 30 years, by the Bristol Channel in Somerset, is one of Europe’s largest construction sites. With accommodation for 7,000 workers who run shifts around the clock, it is an open-air factory for making one of the most complex objects on the planet. When Hinkley Point C is switched on in 2026, its two identical reactors will produce 3,200 megawatts of electricity, making it capable of supplying 7% of Britain’s needs.

Overseeing it all is Sarah Williamson, the lead engineer for BYLOR, a joint venture between Bouygues Travaux Publics and Laing O’Rourke, French and British construction firms respectively. Her immediate task is to keep the Hinkley “delivery machine” running at peak capacity. Her next will be to copy it for Britain’s next planned nuclear plant, Sizewell C in Suffolk.

The government already regarded nuclear power as an important element of Britain’s energy mix before Russia invaded Ukraine, and oil and gas prices soared. When the prime minister, Boris Johnson, met industry bosses on March 21st, he talked of the need for a “thriving pipeline” of nuclear plants. Whether he gets his wish will depend, in part, on how successful Ms Williamson and her team are in copying Hinkley at Sizewell—and, perhaps, beyond.

Nuclear plants are pricey, and much more so if they are bespoke. Reusing plans, suppliers and people to crank out identical ones should make construction cheaper. One way forward is to design so-called small modular reactors, which can be made in factories and then assembled on site. Rolls-Royce, a British engineering firm, is among those interested in doing this, and the government seems keen. But, at the moment, this is unproven technology.

In the meantime, EDF, the French utility with ultimate responsibility for both Hinkley Point C and Sizewell C, says that making construction more predictable will cut the cost of financing—which at Hinkley accounted for 60% of the total. Investors are more likely to offer capital at reasonable rates if they believe a plant will start pumping out electricity on schedule.

Three other plants of the same kind have already been built, in Finland, France and China. Ms Williamson has visited all three, and brought what she learned back to Britain. At Flamanville in France, for instance, the metal casing that shields the nuclear-reactor vessel was assembled outdoors, which meant poor-quality welds and hold-ups during bad weather. So welders at Hinkley manoeuvre components inside vast temporary structures, something like tents crossed with cathedrals, with the help of the world’s largest crane.

The copy-paste process between Hinkley’s reactors similarly yielded incremental improvements. The average time saved on each task has been 20-30%, says Nigel Cann of EDF. Ms Williamson says she and her team think of Sizewell C’s two reactors as “Unit 3 and Unit 4”—not merely identical to those at Hinkley, but a continuation of the same build. Efficiency gains are kicking in even before construction starts, as most of the paperwork is the same. She hopes for time savings at least as great as those between the Hinkley reactors.

Just how much money all this will save is as yet unclear, since financing for Sizewell C is still under discussion between EDF and the government. Currently, consumers are supposed to foot the bill as soon as construction starts—an attractive proposition for investors, since it offloads the risk of delay. The government is looking for ways to enhance energy security by pushing out Chinese investment, perhaps by taking a stake in the plant itself. Russia’s invasion of Ukraine has made reliance on authoritarian states for energy look even more untenable, both politically and in terms of guaranteeing supply.

Regardless of whose money is spent, Ms Williamson’s efforts are crucial to ensuring that both Hinkley and Sizewell go to plan, and that consumers pay as little as possible for Sizewell before the electricity starts flowing. New nuclear plants are central to weaning Britain off Russian oil and gas and reducing carbon emissions. Making construction faster, cheaper and more predictable will be the difference between success and failure. ■

Snitches and witches

How activists and charities embed contested ideologies on campus

IN LATE 2020 administrators at Cambridge University tried to update its free-speech policy to say that faculty and students must be “respectful” of the views and identities of others, rather than merely “tolerating” them. Fearing a chilling effect on research and debate, several scholars succeeded in getting a secret vote on the change. Fully 87% of faculty rejected it.

Six months later the university proposed a scheme, “Change the Culture”, which encouraged reporting of “micro-aggressions”, such as turning your back on or raising an eyebrow at someone. Information left anonymously on a website called Report and Support (R&S) would be held by the university and potentially shared with funding bodies. Opponents dubbed it the “snitch portal”.

Again they mobilised—and again successfully. Within days “Change the Culture” was withdrawn and a few months later the vice-chancellor, Stephen Toope, said he would leave his post two years early. The retreat was welcome, says James Orr, a philosopher who led the charge against the scheme, but should not be taken as evidence of a wider shift away from campus censoriousness. In fact, Cambridge was going against the tide. A report in July by Civitas, a think-tank, found that around 60% of British universities have an anonymous reporting tool, and a similar share are members of an external diversity and inclusion benchmarking scheme.

Supporters see reporting and benchmarking as essential to improving life for marginalised faculty and students. “There is a really clear pattern of systemic inequality right across the sector,” says David Bass of Advance HE, an education charity. Black students make up less than 4% of students in the elite “Russell Group” universities, he points out, compared with an average for all universities of 8%. Ethnic-minority students gain fewer first and upper-second degrees, and just 1% of professors are black. Benchmarking, says Mr Bass, is about “creating an environment where there is inclusion for everyone”.

But for critics, such schemes impose a contested ideological outlook and silence dissent. Not everyone agrees, for example, that micro-aggressions play any significant role in minority disadvantage on campus. Encouraging their reporting means universities are not only tacitly endorsing one side in an ongoing debate, but making it risky for staff or students to take the other, since doing so would probably count as a micro-aggression.

The point of a benchmarking scheme, meanwhile, is to shift norms to bring about a specific outcome. Typically, universities pay to be benchmarked, and pay again for training in how to do better. The result is that the external partner’s view of the world becomes institutionalised—even if that impinges on academic freedom. “What an ‘inclusive’ environment really means for these proponents of institutional reform is to silence dissenting views that do not accept their understood notion of justice,” says Jim McConalogue, one of the authors of the Civitas report.

Culture club

Among the most popular benchmarking schemes is Athena Swan, which is run by Advance HE and was set up to boost women in science and technology. In 2015 it recommended collecting data on the basis of self-declared “gender identity”, rather than sex. To join, a university must commit to narrowing the gap between men’s pay and women’s—a commitment blunted by the replacement of sex by gender identity, since that meant male academics being recorded as female if that was how they identified. And since some funding was linked to Athena Swan membership, academics who disagreed with the new, contested definition either had to remain silent or potentially suffer financial detriment.

After criticism, the connection between funding and membership of Athena Swan was dropped, and its charter was rewritten to acknowledge that biological sex is protected under equality law. But those were not the only changes. Now, rather than committing to “tackling the discriminatory treatment often experienced by trans people”, universities must commit to “fostering collective understanding that individuals have the right to determine their own gender identity”. That “opens the door to institutional thought-policing”, says Arif Ahmed, a Cambridge philosopher. (Mr Bass demurs, and says the charter is consistent with academic freedom.)

Similar problems arise with a “diversity champions” scheme run by Stonewall, a charity that campaigns on gay and trans issues. It requires members use its definition of terms such as “transphobia”, which it says means “denying [someone’s] gender identity or refusing to affirm it”. That leads universities to ignore legal provisions that permit single-sex spaces and instead tell students that they may use whichever toilets or changing facilities they feel match their identity. Dissent must be silenced, since any public indication that students or staff oppose the loss of single-sex spaces is likely to lead to being marked down.

A third diversity scheme to which a majority of universities have signed up is Advance HE’s Race Equality Charter. In 2021 Imperial College in London was awarded a bronze medal for having, among other things, brought in an R&S anonymous-reporting tool and helped the engineering department launch a training video about micro-aggressions. Critics of the charter do not dispute that racial inequality exists, disagreeing only about whether it should always be understood as evidence of present-day discrimination—and therefore, whether such measures can do any good.

A planned Higher Education (Freedom of Speech) bill is supposed to help. Universities will be fined if they fail in their legal responsibility to foster free speech on campus, and a “free-speech champion” will be added to the board of the Office for Students, a regulatory body.

But when universities have outsourced their thinking about discrimination and inclusion, and encouraged anonymous reporting of dissent, such policies will not do much to change campus culture. Major legal clashes are coming, predicts Mr Orr. Universities that sign up to manifestos that commit staff and students to hold specific views on race, gender and equality—or at least to speak and act as if they do—cannot also uphold their duty to ensure free and open dialogue, he says. “There is going to be a lot of legal turmoil for higher-education institutions when it comes to working out which of those two needs to be subordinated to the other.” ■

Bagehot

To appreciate the SNP’s dominance, look at what it has done to the Tories

TALK TO A Scottish Conservative for five minutes, and you will hear that he or she lives in a one-party state, gripped by what their leader, Douglas Ross, terms the “dead hand of nationalism”. Nicola Sturgeon, the first minister, has been in office for seven years; her Scottish National Party (SNP) has been in power continuously for nearly 15. On the sidelines of the Scottish Conservative Party’s annual conference in Aberdeen on March 18th and 19th, Tories warned darkly that universities, charities and businesses are either run by nationalists or too cowed to dissent. They lament expansive new laws inhibiting free speech and meddling in family life. It is a vision of East Germany without the naturists.

There is a crumb of truth in these complaints. Yet if nationalists dominate Scotland, nowhere is that more obvious than in the Scottish Conservative Party. Just as securing independence has been the SNP’s purpose since its founding in the 1930s, so stopping it has become the raison d’être of the Scottish Conservative and Unionist Party, to give its full name.

Scottish unionism has a long history: before 1965 the country’s Tories had a separate Unionist Party, with the union flag as its symbol. Yet a decade ago Scottish Conservatives were a marginal force, mocked and loathed. Their recovery is thanks to the 2014 referendum in which Scots voted to stay in the United Kingdom, and the polarisation that followed as the SNP pursued a second vote. Scots vote according to their constitutional preference: 96% of Scottish Tory voters say they would vote against independence, while 90% of SNP voters would back it. The Conservatives have scooped up unionist voters with a simple slogan: “No to Indyref2”.

Publicly, senior figures decry the constitutional stalemate. Privately, they admit they must prolong it. In his speech in Aberdeen Mr Ross declared that Scotland needed to junk the “referendum obsession” and “move on from this toxic debate”. Afterwards he declared he would continue to speak out for the union. Any decision to hold a second referendum lies with the prime minister—and the incumbent, Boris Johnson, has found nationalism a useful bogeyman, warning that voting Labour in England will result in a repeat vote. Just as spy agencies can sometimes inflate threats to sustain their budgets, the party of the union has an interest in warning of break-up. The SNP could not ask for better propaganda.

Scottish Tories used to deride the monomania of nationalists, for whom no issue was too grave or too trivial to serve as a proxy for independence. Now they imitate it. Nationalists saw covid-19 as evidence that Scotland is better governed alone; Tories cite it as proof of the union’s might. Ludicrously, the SNP’s president drew parallels between Russia’s invasion of Ukraine and Scotland’s quest for self-determination; Tories exult that the war showcases the importance of Britain’s nuclear weapons, NATO membership and oil reserves, all of which would be thrown into flux by separation. If Russian missiles obliterated Edinburgh, the survivors would crawl from the rubble to explain why it proved them right.

The SNP and Tories have feasted on the Scottish Labour Party, which has seen its voters split on the constitution. That has transformed both. SNP members, once known as the Tartan Tories for their stuffy small-statism, have embraced left-wing economics and social liberalism. Scottish Tories, once a genteel bunch in tweeds and red corduroys, court working-class unionists in former mining and steel towns battered by Thatcherism. Like Brexit, the constitutional question has become a gateway for unlikely new voters: less Range Rovers, more Rangers Football Club.

In his recent book “Standing up for Scotland”, David Torrance, an academic, argues that for more than a century the Scottish Tories have practised “nationalist unionism”, according to which the union can be defended only by those who are proudly Scottish and stick up for the country. Under the SNP’s dominance the Tories’ Scottishness has become more ostentatious, but the strategy harder to execute. They must demonstrate that they are no mere branch office of the national party and can be relied upon to stand up to Mr Johnson’s unpopular government. But that inevitably lends credence to the notion that Scotland is a land apart in which London has no legitimate role. Either way, the SNP wins.

The result is endless, fruitless debate about rebranding and restructuring—and, on occasion, farce. The Scottish Tories disliked Brexit, but now must defend it. Mr Ross called for Mr Johnson to resign over parties in Downing Street, then declared he should stay during the war in Ukraine, but now refuses to say whether he should fight the next election. It is hard to defend your country’s territorial settlement when your party is a mess.

In elections, competition for voters is supposed to force parties to produce better candidates and policies. But when communities vote as blocks, that process fails. If nationalists can continue to hold half the electorate, no matter what, there is no punishment for Scotland’s failing schools or hospitals. And because nothing can be allowed to undermine the cause of independence, risky reforms are avoided.

Market failure

At his party’s conference, Mr Ross lamented how the promise of an independence referendum was enough to sustain a “hollowed-out shell of a government”, bereft of ideas and lacking ambition. He hopes to widen the Tories’ appeal with social-care reforms and tough measures against sex offenders. But privately his colleagues admit that the permanent campaign against independence has squeezed out any distinctive policy agenda. Nationalist policies—free university tuition and “shooting galleries” for heroin addicts—have been embraced. The result is a party that is wholly unionist, but with precious little conservatism. If Ms Sturgeon were suddenly to announce that the SNP had abandoned the idea of a referendum, says a senior Scottish Tory, “we’d say, my God, what do we do now?” ■

Read more from Bagehot, our columnist on British politics:
Does Rishi Sunak have the stomach for what he must swallow? (Mar 19th)
The Conservatives are planning to overhaul the Human Rights Act (Mar 12th)
The rise and fall of Londongrad (Mar 5th)

International

• Geopolitics: New cold war, new compromises

New cold war, new compromises

How Vladimir Putin provokes—and complicates—the struggle against autocracy

THE STRUGGLE between autocracy and democracy is “the defining challenge of our time”, President Joe Biden said in December at a virtual “Summit for Democracy”. Vladimir Putin’s invasion of Ukraine offers evidence he was right. With missiles and tanks, an autocrat is trying to snuff out a freely elected government.

Further, the core of the coalition against Mr Putin, consisting of America and most of Europe, is solidly democratic. In short, the pushback against Mr Putin would seem to fit Mr Biden’s framing—a “battle between democracy and autocracy”, as he said in his state-of-the-union speech. But geopolitics is never so neat.

Though Mr Putin’s most important backer, China, is authoritarian, several democracies are ambivalent. India, a big buyer of Russian arms, refuses to condemn him. South Africa, whose ruling party had a long friendship with the former Soviet Union, lays some blame for the war on NATO. Brazil’s president, whose “masculine qualities” Mr Putin once praised, professes neutrality. Israel says it is temporising in hopes of playing mediator.

And Mr Biden is also seeking help from authoritarian regimes, provoking worries that, just as the West overlooked abuses by anti-communist allies during the cold war, it will make ugly compromises now to counter Mr Putin. Doing so would pose diplomatic and political challenges. Compared with claiming compromise was necessary to resist the spectre of communism, it may prove trickier to argue—to allies abroad and voters at home—that one should curry favour with autocrats in order to confront autocracy.

Consider Turkey, a country of vast strategic importance where democracy is under siege. Western criticism of Turkey’s strongman, Recep Tayyip Erdogan, has gone quieter since the war began.

While sympathising with Ukraine and selling it remarkably effective combat drones, Mr Erdogan has opposed sanctions against Russia and kept his airspace open to Russian planes. He has also thrown Mr Putin a financial lifeline, suggesting that trade between Turkey and Russia be carried out using roubles or gold. Ordinary Russians fleeing persecution at home have found a haven in Turkey. Yet so have Russian oligarchs fleeing Western sanctions. Two superyachts belonging to Roman Abramovich, a billionaire friend of Mr Putin, have docked there.

Western officials are urging Turkey to take a tougher line on Russia. Turkish democrats fear Mr Erdogan will demand a steep price, such as Western leniency towards his habit of locking up his critics and muzzling the media. On March 1st Mr Erdogan suggested that Turkey be given a fast track to European Union membership. A week later, he urged Mr Biden to lift sanctions against Turkey’s defence industry, imposed after Mr Erdogan bought an S-400 air-defence system from Russia. America has since offered a way out, suggesting that Turkey send the S-400s to Ukraine. That is unlikely to happen for technical and political reasons, not least Turkey’s fear of retribution from Russia. But America may yet cut a bargain with Mr Erdogan. America put up with an undemocratic Turkey during the first cold war because it was an ally. It may do so in the new cold war, too.

Among the Western countries, liberal ones face a version of this dilemma. Poland is a lot more democratic than Turkey, but in the past few years its government has interfered with judges and harassed opposition media. Because of this, the EU froze €36bn ($40bn) in pandemic-recovery funds earmarked for Poland.

Today, however, Poland has welcomed the largest share of Ukrainian refugees and allows weapons for the Ukrainian resistance to cross its territory. Facing the threat that Russia, its oldest foe, could be on its border, it is keen to reconcile with the EU. That could spur the ruling Law and Justice party to temper its judge-nobbling and press-stifling. But the opposite is also possible. Poland’s Western partners may overlook abuses because of the essential role it is playing over Ukraine. “It would be very odd to be pressuring the Polish government on the rule of law right now,” says an analyst close to the Biden administration. “But Warsaw should understand that countering autocrats requires strengthening our own democracy.”

For their part, critics fear that Law and Justice will use the spectre of further Russian aggression to wrap itself in the flag, tighten its grip over Polish institutions, and step up attacks against “enemies” within, such as liberals, feminists and gay people. “Perhaps we need to change our approach even more thoroughly,” a presenter on Polish state TV recently mused. “Can a frontline state allow itself to tolerate attacks on its system of values?”

The war has caused energy prices to soar, prompting the West to reconsider its relations with autocratic petrostates. (Of the 13 members of OPEC, a club of oil exporters, 11 are rated “not free” by Freedom House, an American watchdog; two are rated “partly free”.) Unlike his predecessor, Mr Biden has infuriated Gulf rulers by stressing human rights. He once promised to make the Saudi regime “the pariah that they are”. Now he is asking it to pump more oil—a message reinforced by Boris Johnson, Britain’s prime minister, who visited Riyadh on March 16th. Mr Biden may have to go further to make nice with Muhammad bin Salman, the Saudi crown prince, whom he has accused of ordering the dismemberment of a Washington Post columnist in 2018. The prince is cosying up to China to demonstrate he has options. He is considering pricing oil sales to China in yuan instead of dollars, the Wall Street Journal reports. The prince wants more help with his ill-fated war in Yemen and immunity from prosecution in America.

Another oil-fuelled autocracy, Venezuela, hopes the war in Ukraine will help it escape an embargo. Many democracies refuse to recognise Nicolás Maduro, an election-rigging despot, as president. Mr Putin has propped up Mr Maduro with planeloads of weapons and cash, plus some troops, largely to show he can meddle in America’s backyard. But now everyone’s calculations are changing.

Mr Maduro can no longer count on Mr Putin, who is cash-strapped and far more concerned about conquering Kyiv than coddling Caracas. Mr Biden cares more about stopping Mr Putin than unseating Mr Maduro. Hence the extraordinary scene on Venezuelan television on March 7th, when Mr Maduro described meeting a White House delegation two days before. “The two flags looked beautiful,” he gushed, “united, as the flags of the United States and Venezuela should be”.

The Biden administration says the main aim of the visit was humanitarian. Mr Maduro released two imprisoned Americans. He also promised to return to talks he abandoned last year with the much-persecuted Venezuelan opposition. But the two sides talked about oil, too. The delegation to Caracas reportedly made any sanctions relief contingent on Venezuela exporting some oil to the United States.

Both sides are wary. But a limited rapprochement seems possible, and would surely strengthen Mr Maduro’s grip on power. His meeting with American officials was “de facto recognition” that he is in charge, says Temir Porras, a former chief of staff to Mr Maduro. The strongman has “got something that he always wanted”. Republicans accuse Mr Biden of showing weakness by reaching out to despots. Marco Rubio, a senator from Florida, said that the meeting “did tremendous damage” to the opposition.

Sympathy for the devils

Democracies have a long history of deals with nasty regimes. Some were plainly necessary. To defeat Nazi Germany the West worked with Josef Stalin, prompting Winston Churchill to remark: “If Hitler invaded Hell, I would make at least a favourable reference of the Devil in the House of Commons.” Others seem shameful. America’s cold-war support for anti-communist kleptocrats in strategically peripheral places, such as Mobutu Sese Seko in Zaire (now Congo), finds few defenders today.

The struggle against Mr Putin will force the West to reconsider many of its ties with lesser malefactors. But the new cold war is different from the old one. Communism was a universal ideology that inspired revolutions in Africa, Asia and Latin America. Putinism is a howl of nationalist and reactionary rage. Neither Russia nor China offers “a compelling worldview capable of attracting mass popular support worldwide”, notes Stewart Patrick of America’s Council on Foreign Relations. This makes them less of an existential threat to the free world than the Soviet Union was, and so reduces the incentive, or rationale, for making bargains as distasteful as those made to keep communism at bay.

As sanctions crush Russia’s economy, the Kremlin’s support for its own autocratic clients may wither. Strongmen in Mali and the Central African Republic may survive, since the Russian mercenary operations that protect them appear to be self-financing. (The CAR has a lot of diamonds.) But Bashar al-Assad in Syria and Alexander Lukashenko in Belarus may be wobblier. Mr Putin has saved both tyrants in the past, sending troops to crush Syrian rebels in 2015, and goons to help Mr Lukashenko put down protests against a stolen election in 2020. Both men are keen to keep Mr Putin in their corner. Mr Assad, who is seeking to end his isolation from his fellow Arabs, is said to have sent Syrian “volunteers” to help Russia in Ukraine.

Mr Lukashenko helped Mr Putin by letting Russia launch its southwards push for Kyiv from Belarusian soil. Belarusian troops were supposed to join in, but the Belarusian opposition says they are reluctant to follow orders from an unpopular despot to attack blameless fellow Slavs. Belarusian rail workers have reportedly sabotaged rail links with Ukraine to stop supplies from reaching the invaders.

So far, the war itself is demonstrating some of democracy’s strengths and autocracy’s drawbacks. Ukraine’s fighters have astonished their adversaries, and its people’s commitment to their freedom has inspired the world. For his part, Mr Putin was able to start his ruinous war on a whim. His flunkeys are scared to bring him unwelcome news. He seems sincerely to have expected many Ukrainians to welcome his troops. And his regime, like most autocracies, is corrupt, rendering his army weaker in the field than on paper. Budgets have been looted; Russian kit is breaking down for lack of maintenance or spare parts.

Yet the result of the war is unpredictable, and so too will be its effect on global democracy. If Mr Putin achieves something resembling a victory, that could inspire strongmen everywhere. If he loses, that could inspire those who stand up to them. When Mr Biden reconvenes his democracy summit later this year, much will depend on the courage of Ukrainians, and the support they receive from democracies, with all their flaws. ■

Read more of our recent coverage of the Ukraine crisis

Business

• Corporate travel: The return of the road-warrior

The future of business travel

A guide to your next business trip

SHARP ATTIRE and a purposeful stride. The left-hand turn on the plane away from the cheap seats. Skipping the in-flight film to refine a presentation. Over the past two pandemic years these obvious giveaways of the globetrotting executive became a rare sight. According to the Global Business Travel Association (GBTA), a trade body, worldwide spending on flights, hotels, car hire, restaurants and other expensable services fell from $1.4trn in 2019 to $660bn in 2020 as a result of covid-19 lockdowns and tough limits on cross-border movement.

Despite fresh disruptions, from coronavirus outbreaks and a tragic plane crash in China to Russia’s war in Ukraine, many places are relaxing travel restrictions. America and Europe are mostly open for business. On March 21st Hong Kong said it would admit vaccinated arrivals from nine countries, including America and Britain, from April 1st and relax onerous hotel-quarantine requirements. Business travellers are once again visible at airports, on aeroplanes and in hotels. The GBTA expects corporate travel to rebound sharply this year and return to its pre-pandemic peak by 2024 (see chart 1).

That is a relief to full-service airlines, which counted on business travellers for 30% of revenues and a higher proportion of profits, and big global hotel chains, which earned two-thirds of their sales from executive guests. For corporate road-warriors the news is more mixed. Remaining covid-19 measures, readjusted travel budgets, changing work patterns, heightened risk awareness by companies and individuals: all are changing business travel in profound ways. Some of the changes will make travelling for work a more pleasant experience. Others will not.

Throwing your laptop, mini-toiletries and clothes into a wheelie bag used to be a pretty universal corporate ritual. Henceforth whether or not you do will depend more on whom you work for, your role, where you are going and the purpose of your trip. Scott Davies, boss of the Institute of Travel Management, another industry body, explains that overall travel budgets used to be set annually, often against broad commercial objectives. As they are rebuilt after the covid lull, he expects many trips to be considered on a case-by-case basis. Many marginal jaunts won’t clear the hurdle (see chart 2), especially as companies get serious about reducing their carbon footprints, which swell with every air mile.

Some trips will be quick to return. Indeed, even at the height of the pandemic essential business travel continued; managing and maintaining remote oil wells, large infrastructure or factories far from the head office is impossible over the internet. The share of travel spending by manufacturing, utilities or construction firms edged up from 48% in 2019 to 51% in 2020, according to the GBTA. Companies for which face-to-face client meetings are desirable to maintain relationships and vital to drum up new business, such as finance and professional-services firms, have been swift to get workers back on the road. Anecdotal evidence suggests that as soon as one company heard that a competitor was out pressing the flesh (or at least bumping fists) it followed suit.

If you do pack that suitcase, your destination is likelier to be domestic. As with leisure travel, long-haul trips for work are recovering more slowly. A poll of over 450 companies by the GBTA in February found that two in three had restarted domestic trips but fewer than one in three had done so for cross-border journeys.

Domestic trips in America, which accounted for nine in ten American corporate excursions in 2019, according to Bernstein, a broker, will increasingly go ahead. So will short-haul hops between European cities, which in 2018 made up two-thirds of EU business trips. Until the latest covid flare-ups the same looked true for flying in China, where business-travel spending fell by far less than the global average in 2020 and was recently forecast to grow by double the global average in 2021 (though Chinese borders remain impregnable to most outsiders).

Your fellow passengers will disproportionately work for smaller companies. American Airlines reckons that travellers from smaller firms are back to 80% of their pre-covid numbers. The comparable figure for big firms is 40%. One reason is that small businesses mostly send people on those popular domestic routes. Another is that they may be a bit more relaxed about their workers’ wellbeing. Vik Krishnan of McKinsey, a consultancy, says that the pandemic has prompted travel managers at big companies to feel a heightened sense of their duty of care to employees.

Fight for flight

Getting a trip approved is, then, getting harder than before. A recent survey of 170 North American corporate-travel managers by Morgan Stanley, a bank, shows that budgets in 2022 are expected to be 31% below the level of 2019. In the short run approval may get harder still. On March 15th Ed Bastian, chief executive of Delta Air Lines, told the Financial Times that the war-induced spike in the oil price “will no question” raise ticket prices on both domestic and international routes. Other airline bosses doubtless have similar designs.

Even if your supervisor signs off on your trip, you will find it harder to plan. The world’s airlines are running at around two-thirds of their pre-covid capacity. That means less choice on times and fewer direct flights, notes Richard Clarke of Bernstein. The problem is not confined to flying. The scrapping of the 5.40am Eurostar train from London to Paris forces executives to arrive the night before in order to strike that morning deal over a croissant and café au lait.

Once on the road, the experience isn’t what it used to be, either. With many executive lounges yet to reopen, the weary manager must seek refuge at a noisy restaurant—or worse, since plenty of eateries, too, remain shut, on a bench in the concourse within earshot of a disaffected infant. At many airports you will also still need to wear a mask. Although London’s Heathrow and a few other airports have lifted mask requirements, America’s federal mask mandate has been extended until at least April 18th. In the past year the Transportation Security Administration has fined nearly 1,000 unmasked travellers, so you ignore the rule at your peril (and good luck expensing that fine).

On board the plane you may find yourself in economy class more often, and not merely because of the rising air fares. Some climate-conscious airlines are already reconfiguring planes with fewer business-class seats (whose emissions per occupant are three times those of an economy seat). CEOs of large companies will be sad to hear that first-class seats, which are even dirtier, may disappear for good.

In the air, expect to be served by cabin crew draped in personal protective equipment (especially in Asia, which remains more concerned than the West about hygiene). You, too, must keep your mask on, unless you are consuming food or drink (of the non-alcoholic variety on American Airlines, which will only restart in-flight booze sales in mid-April). At least hot meals are back; as recently as last month even first-class passengers on American and Delta had to do without such sustenance on domestic flights.

Over the longer term, the news for the itinerant executive isn’t all bad. The introduction of touchless technology and online check-in for flights and hotels should speed up travel a little (at least once pandemic paperwork such as passenger-locator forms and vaccine certificates no longer needs verifying). With many planes sitting idly on the tarmac as a result of covid-related cancellations, some airlines used the opportunity to spruce them up. Australia’s Qantas has, for example, modernised its fleet of A380 superjumbos by installing comfier seats for premium passengers. Singapore Airlines has updated the cabins on some of its short-haul fleet.

The few who get to hitch a ride on a corporate jet are also becoming a bit less select. Business-jet traffic has recovered much more swiftly than commercial aviation. According to WINGX, a consultancy, January was the busiest month ever, with the number of flights 15% higher than in January 2019. In a survey by Morgan Stanley, 11% of respondents said their firms would be more liberal with the use of business jets in 2022 than they were in 2021.

Chronic jet-lag may become a thing of the past. With long-haul travel still constricted, firms are reportedly opting to send executives on fewer trips that stretch to more days. Unseemly displays of corporate machismo, such as flying half way across the world for one short meeting, may never return, no doubt pleasing everyone concerned.

And many of those longer trips are combining work and play. Morgan Stanley sees evidence at American hotel chains that Thursdays and Sundays are becoming more popular with guests, suggesting that some workers may be moving trips towards the start of the week or its end, to blend work with pleasure. Such trips have become common enough to earn an ugly moniker, “bleisure”. Danny Finkel of Trip Actions, a firm which helps others manage business travel, says this could appeal to those who approve expenses, too: weekend flights are often much cheaper, offsetting the cost of extra nights at a hotel.

Perhaps the best news for the bedraggled business traveller is that some trips simply won’t happen. Jarrod Castle of UBS, a bank, notes that 40% of business trips are to meet clients and another 40% involve internal meetings. Conferences, exhibitions and the like make up the rest. He reckons that perhaps half of the intra-company jaunts, especially for training or get-togethers between non- C-suite executives, are expendable. That means a fifth fewer trips overall. No grumbling there. ■

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Surge pricing

How companies use AI to set prices

FEW AMERICAN business tactics are as peculiar in a freewheeling capitalist society as the manufacturer’s suggested retail price. P.H. Hanes, founder of the textile mill that would eventually become HanesBrands, came up with it in the 1920s. That allowed him to use adverts in publications across America to deter distributors from gouging buyers of his knitted under garments. Even today many American shopkeepers hew to manufacturers’ recommended prices, as much as they would love to raise them to offset the inflationary pressures on their other costs. A growing number, though, resort to more sophisticated pricing techniques.

A seminal study from 2010 by McKinsey, a consultancy, estimated that raising prices by 1% without losing sales can boost operating profits by 8.7%, on average. Getting this right can be tricky. Set prices too high and you risk losing customers; set them too low and you leave money on the table. Retailers have historically used rules of thumb, such as adding a fixed margin on top of costs or matching what competitors charge. As energy, labour and other inputs go through the roof, they can no longer afford to treat pricing as an afterthought.

To gain an edge, shopkeepers have been turning to price-optimisation systems. These predict how customers will respond to different pricing scenarios, and recommend those that maximise sales or profits. At their core are mathematical models that use oodles of transaction data to estimate price elasticities—how much demand increases as the price falls and vice versa—for thousands of products. Price-sensitive items can then be discounted and price-insensitive ones marked up. Merchants can fine-tune the algorithms to prevent undesirable outcomes, such as double-digit price surges or larger packages costing more by unit of weight than smaller ones.

These systems are becoming cleverer thanks to advances in artificial intelligence (AI). Whereas older models used historical sales data to estimate price elasticities for individual items, the latest crop of AI-powered ones can spot patterns and relationships between multiple items. Makers of pricing software are incorporating new data sources into their models, from customers’ tweets to online product reviews, says Doug Fuehne of Pricefx, one such firm. The cloud-based platform developed by Eversight, another provider, allows retailers to test how slight increases or decreases in the price of, say, Heinz ketchup at different stores affect sales not just of that specific condiment but across the category. It is used by big manufacturers such as Coca-Cola and Johnson & Johnson, as well as some supermarkets (Raley’s) and clothes-sellers (JCPenney).

All this makes pricing systems “much more three-dimensional”, observes Chad Yoes, a former executive at Walmart who oversaw pricing at the retail behemoth. Retail bosses are keen to promote this sophistication to investors, who value firms’ pricing power at a time of high inflation. In February Starbucks, a chain of coffee shops, boasted about its use of analytics and AI to model pricing “on an ongoing basis”. US Foods, a food distributor, has touted its pricing system’s ability to use “over a dozen different inputs” to boost sales and profits.

Price-optimisation may make prices more volatile. “Retailers are pricing faster today than they ever have before,” says Matt Pavich of Revionics, another pricing-software firm. That is especially true in the fast-moving world of e-commerce. But even Walmart reviews the prices of many items in its stores 2-4 times a year, says Mr Yoes, up from once or twice a few years ago.

What pricing systems do not do is lead inexorably to higher prices. Mr Pavich calls this misconception “one of the biggest myths” about products like his. Sysco, a big food distributor which rolled out new pricing software last year, is a case in point. The firm says the system allows it to lower prices on “key value items”—as price-sensitive bestsellers are known in the trade—and raise them on other products. It can thus increase profits by expanding sales while maintaining margins. That keeps investors content and shoppers sweet. ■

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Food fight

Packaged-food firms are running out of room to raise prices

THE MARKET for packaged foods is a competitive one, where price rises by one firm risk pushing shoppers into the arms of rivals. Companies in the industry deal with soaring costs by hedging against spikes in commodity markets using forward contracts, reformulating products so they contain less of the pricier foodstuffs or, failing that, surreptitiously making packages a bit smaller while keeping the ticket price the same.

Amid pandemic-related supply-chain bottlenecks, labour shortages and crop failures, food firms have repeatedly done all that. Even so, they have had to raise prices, often less judiciously than is ideal. The invasion of Ukraine, known as Europe’s breadbasket thanks to its rich soil, by Russia, the world’s top exporter of wheat, is forcing their hand once again. Together the two countries account for 29% of international wheat sales and nearly 80% of sales of sunflower oil. Disruptions to those critical supplies are pushing up food companies’ costs just as energy costs are also sky-high as a result of the war.

It will be harder for European food companies to pass price rises to consumers than for American firms. Supermarkets in Europe are more concentrated than in America, and drive a harder bargain with suppliers. Walmart, America’s biggest, controls 17% of the domestic market. Its British and German opposite numbers, Tesco and Edeka, respectively, have nearly 30% of theirs. Moreover, cost-conscious Europeans shop more at discounters such as Aldi or Lidl. They are also less fussy than Americans about branded products and buy more of the retailers’ own labels.

On March 23rd General Mills, the American maker of Cheerios and Wheaties, among other sugary fare, reported healthy margins and quarterly sales that were higher than in the same period in 2019, before the pandemic (though flat compared with last year). The firm insisted that demand for packaged food should remain strong all year as many people continue to work from home at least some of the time. Robust appetite for its products will, the firm says, allow it to raise prices to offset the rising costs of commodities.

That may be optimistic. Shoppers’ patience with inflation is wearing thin on both sides of the Atlantic. Investors expect margins to narrow. The share prices of big American, European and Chinese food firms alike took a knock after Russian tanks rolled onto Ukrainian fields on February 24th (see chart). ■

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The Zoom lift

Botox and other injectable cosmetics are booming

COSMETIC PROCEDURES used to be the preserve of middle-aged women and often involved surgery. Today they are increasingly sought by girls who want the photoshopped faces of their favourite social-media influencer, and by a growing number of men wishing for fewer wrinkles, fuller lips and sharper jawlines. Globally, more than 14m nonsurgical procedures were conducted in 2020, even amid the pandemic, up from fewer than 13m two years earlier. Increasingly, scalpels are giving way to syringes.

Research and Markets, a firm of analysts, reckons that the global sales of non-invasive aesthetic treatments, currently around $60bn, could more than triple by 2030. A large part of that growth will come from injectables. These include Botox and other substances that freeze facial muscles, as well as dermal fillers which plump softer tissue. Demand has been fuelled by the proliferation of selfies and, during the pandemic, high-resolution video-calls. Snapchat and Instagram filters give users a glimpse of what they could look like with a filler-generated “liquid facelift”. The contrast with what they see on unadorned Zoom can be stark.

In America 2.4m injectable procedures were carried out in covid-hit 2020, roughly one for every 100 American adults. About 700,000 such treatments were performed on Germans, not renowned for an obsession with looks. Brazilians, who are famously beauty-obsessed but much poorer, subjected themselves to around 500,000. Demand for “prejuvenation” work is especially strong in Asia, where younger patients (for, despite the convenience these are still medical procedures) want to pre-empt a craggy visage before any lines actually appear. Since injectables have to be topped up every few months, they guarantee producers of the substances and clinics that administer them a source of recurring revenue. The younger the customer starts, the better for business.

According to a report by McKinsey, a consultancy, over 400 aesthetics clinics, which administer injectable treatments (among others including things like laser fat removal) raised more than $3bn from investors over the past five years. In 2020 AbbVie, an American pharmaceutical firm paid an eye-popping $63bn for Allergan, which has controlled nearly half the market for injectables since it launched Botox for aesthetic use two decades ago and Juvederm, a dermal filler, a few years later.

New products are beginning to threaten Allergan’s dominance. Hugel, a South Korean company, now has a rival offering that is half the price of Botox. It is eyeing the Chinese market, where the stuff is still less common than dermal fillers. Ipsen, a French drugmaker, and Merz Pharma, a German one, also make Botox-style injectables. Ipsen’s Dysport has done well in Turkey and Russia. Merz’s sales are growing briskly in the emerging economies of Asia and Latin America.

Some modern dermal fillers, meanwhile, are formulated with ingredients such as hyaluronic acid that are typically found in mild skincare products. That is less offputting to potential customers than Botox, which is derived from a toxin that occurs naturally in spoilt sausages. Other new treatments are dispensing with foreign substances entirely—though this doesn’t always seem all that more appealing. Certain cosmetic clinics offer to inject stem cells from a patient’s own fat into their face, or platelets from their blood to rejuvenate the skin.

There is a wrinkle. The injectables craze, especially among youngsters, worries regulators. Botox is a prescription drug in most places but many dermal fillers are not. “Treatments are often trivialised on social media and people don’t understand the full ramifications of what can go wrong,” says Tijion Esho, a cosmetic surgeon in Britain. Misplaced injections can lead to abscesses or, in some cases, necrosis. An outcry from doctors and victims of botched procedures forced the British government to announce in February that it would require a licence for people administering nonsurgical treatments. England has already banned them for under-18s. ■

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Shark attack

What “Shark Tank” says about Indian capitalism

SPEAK TO THE bankers and industrialists at the top of India’s economic pyramid and you hear a common refrain. All Indians, they contend, are at heart socialists—themselves included. The popularity of the Indian version of “Shark Tank”, a TV celebration of capitalism (similar to “Dragons’ Den” in Britain) in which ordinary people seek funding for their business ideas from a gaggle of successful entrepreneurs, suggests that this conventional view may be out of date. The show’s 36-episode run, wrote the Hindustan Times, shifted the topic of dinner conversations throughout the vast country from cricket to business plans. Terms like “gross profit” and “TAM” (total addressable market) have entered common parlance among its 1.4bn people.

Shows with star judges awarding talent (and panning its absence) have long had a place on Indian television. But they have historically involved song and dance, not spreadsheets. Sony Entertainment received 85,000 applications for “Shark Tank”. These were whittled down to 198 pitches presented to juries of five judges, themselves chosen to reflect India’s new business elite (rather than being scions of industrial conglomerates they had founded firms peddling everything from cosmetics and drugs to a matchmaking app and electronic payments).

The enterprising hopefuls’ televised presentations were heavier on enthusiasm than polish. Rather than being a liability, this resonated with viewers who, as many blogs and social-media posts attested, saw themselves in the contestants. For “Shark Tank” was, in its effervescent diversity, not unlike Indian society. Of the 67 startups that secured some money from the judges, three-fifths were run by first-time entrepreneurs. More than two-fifths had female co-founders and a third were co-founded by someone from a small city rather than a business hub like Bangalore, Delhi or Mumbai. Only nine of the winning businesses had a founder who boasted a degree from the prestigious engineering and business schools that are the traditional pathway into India’s economic aristocracy.

Some of the winning pitches seemed humdrum (banana crisps). Others were ingenious (an engineer whose family had been devastated by the abrupt death of their cow developed an electronic ear clip to monitor bovine health). Some were both (a bicycle-mounted pesticide sprayer). Even some losing proposals won recognition. Reversible dresses (good for a day in the office and a night on the town) were dismissed by one of the judges as suitable for a mop; his wife subsequently appeared wearing one on TV.

“Shark Tank” may have struck a chord because it came at a time when Indians as a whole were becoming more enterprising. Indian entrepreneurs have registered over 310,000 new businesses in the past two years, up from 250,000 or so in the previous two (see chart). The ranks of retail stockpickers doubled between March 2019 and November 2021, to 77m. Some of this happened out of necessity: the pandemic up-ended lives and led millions to seek new opportunities. But some was probably by choice. The number of candidates sitting India’s exacting civil-service exam appears to have peaked in 2016. Some eggheads who would once have become bureaucrats may have opted to become capitalists instead. ■

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Bartleby

What an honest leaving-do speech would sound like

WHEN HARRY told me that he was leaving the company, one of the first things he said to me was that he didn’t like sentimental goodbyes. I have decided to take him at his word. Everything you will hear me say tonight is unvarnished and to the point, just like the man himself.

Harry has been in the finance department for seven years. In that time he has not done anything remotely funny. I asked several people if they had anecdotes about him, and the best they could come up with is that he once accidentally changed a formula in the annual budget spreadsheet. Since the mistake was quickly spotted and fixed, it had no impact at all. I asked Charlotte, who has worked with you closely for three years, if she had anything to share. She was silent for what seemed like hours, and then said that she thinks you like walnuts. (Ah, I see you shaking your head, so that is neither funny nor true.)

No matter. We do not hire people because they have an amusing habit of getting stuck in lifts (yes, Brian, I do mean you) or promote them because they can recite pi as a party trick. It is true that a mediocre colleague who happens to have some eccentric habits (and yes, Brian, I still mean you) would have produced a much more enjoyable leaving event than this painfully stilted affair. But that should not obscure more important things. Harry has been a diligent, competent and well-liked employee. He has been a good manager. Every job he has done for us he has done well.

Not so well that he is indispensable, of course. We did offer him a raise when we found out he was planning to leave, but we opted against throwing in a sabbatical. In the end we recognised that he wanted to go and decided that we would cope just fine. There is no shame in that. Everyone is dispensable; it’s just a question of how quickly people come to that realisation. In Harry’s case, it was neither all that slow nor embarrassingly fast.

Since then, we have all been waiting for him actually to leave. Once it is known that a person is moving on from their role, everyone immediately prices it in. People with ambition start writing memos about what they would do if they had that job. Rebecca’s pitch arrived the day after we announced your departure. I can see now that you didn’t know that, and that she didn’t expect me to mention it.

Meetings quickly start to disappear from calendars. Decisions are deferred or simply taken elsewhere. It’s like the period between an election and an inauguration: there is someone in office but no one in power. By the time we get to this point, holding a glass of Prosecco and staring at you as if you are an endangered species, it’s something of a surprise to find that you still exist.

Will Harry be forgotten? Not at all, though for reasons that he may not fully grasp. This is an evening in which the person who is leaving receives presents (as well as a card from people whose names you don’t recognise but who just loved working with you). But the exchange goes both ways. The leavers have a parting gift of their own to bestow: a convenient scapegoat.

When someone dies, the convention is not to speak ill of the departed. When an employee exits a company, it’s the opposite. Things that don’t work as well as they should can be laid at the door of someone who won’t answer back. Frustrations that have been suppressed can finally be blamed on someone. When we speak of you, we will say things like “Harry had many strengths but…”, and we will persuade ourselves that you held us back a bit. This will not be true, but it will be convenient. I’d like to take this opportunity to tell you that we are grateful for this final act of service, which can last for as long as a year after someone has actually left the building.

After that, memories tend to fade. I wish I could promise you that you are part of company folklore, or that your role in banning plastic straws from the office will reverberate through the ages. Instead, the only guarantee I can give is that no one here will ever read your exit-interview notes.

This may all seem a little sad. You have spent many years at the company, and yet will probably leave comparatively little trace. But you should still feel pride in your time here. To have done your work well and to leave at a time of your choosing are achievements that are beyond most people (and on both scores, Brian, I am still thinking of you). So please raise your glasses to Harry. He has been an excellent colleague and won’t really be missed.

Read more from Bartleby, our columnist on management and work:
Why loafing can be work (Mar 19th)
The return of the crowded office (Mar 12th)
Company or cult? (Mar 5th)