The phrase “I hate to say I told you so” is annoyingly insincere. Normally, there is nothing people love more than saying, “I told you so.” So I will simply admit to mixed feelings in pointing out, that I wrote a column three months ago, suggesting that Italy would be sucked into the euro crisis. There were two crucial facts that led me to that conclusion. First, Italy’s debt-to-GDP ratio at 120% was already higher than that of Greece, Portugal and Ireland, at the point where they were forced to apply for help. Second, Italy’s financial position was only sustainable in a climate of very low interest-rates. And that would not last forever. Read more
A lot has changed in the Middle East since the Arab uprisings began. But one thing that remains constant is the obsession of international diplomats with the Israeli-Palestinian “peace process”. Monday saw yet another effort to drag the unwilling parties back to the negotiating table. A meeting of the Quartet (the US, the UN, the European Union and Russia), held in Washington, was expected to call for talks to restart, as a matter of urgency.
The space shuttle is in its last ever flight, and Washington is locked in debt talks that now resemble a Samuel Beckett play on which someone has forgotten to bring down the curtain. A good time to recall one of the fiscal follies from the heady spending days of the 2000s boom: George W. Bush’s idea of putting a man on Mars.
As plans go, the Mars programme was a particularly mad one: it would have cost about a trillion dollars, (over many years, admittedly, so the net present value would have been a lot lower) in an agency notorious for cost overruns. Best quote at the time came from the redoubtable Charles Schultze, former White House economist under Jimmy Carter: the price of keeping an astronaut safe in space means every crewed mission becomes a flying Ming vase. Read more
The newspapers today are obsessed by the threat to the Murdoch empire. But I wonder whether the gloating over the sight of the media mogul laid low is slightly diverting attention from a potentially more dramatic angle to the phone-hacking story - the threat to the entire Cameron government. Read more
Africa’s largest country has been divided into two and the world has its 193rd new nation. With luck, the partition of Sudan and the creation of the new country of South Sudan will mark the final close of a decades-long civil war that has, directly and indirectly, claimed millions of lives. Even the new nation of south Sudan is a vast country – bigger than Kenya, Uganda and Rwanda combined. Read more
Syria, DSK, Yingluck Shinawatra
In this week’s podcast: Are there signs that the crisis in Syria is coming to an end? Can former IMF boss Dominique Strauss-Kahn really make a political comeback in France? And, Thailand’s first female prime minister – what challenges will she face?
Presented by Gideon Rachman with David Gardner, Ben Hall and Serena Tarling in London and Tim Johnston in Bangkok. Read more
One of the unusual aspects of the Bahrain uprising in February and March this year was the fact that it did not dominate the broadcasts of Qatar’s al Jazeera (the Arabic language channel) and Saudi Arabia’s al-Arabiya.
In the name of Gulf solidarity – and given the dispatch of Saudi and other Gulf troops to bolster the ruling al-Khalifa family – highlighting a youth awakening among Bahrain’s Shia against the Sunni monarchy was out of the question. Read more
I spent last weekend in Helsinki, where the “political class” are deeply troubled by the rise of the populist and nationalistic “True Finns” party, which is riding a wave of anti-European sentiment. Alex Stubb, who has just lost his job as Finland’s foreign minister and is now minister for Europe and trade, noted that the True Finns are still rising in the polls – and are now at 23%, up four points from the general election earlier this year. Olli Rehn, Finland’s man at the European Commission (with the unenviable portfolio of looking after the euro), said that he longs to take on Timo Soini, the leader of the True Finns, in a direct debate. Read more
Want to see what an IMF managing director’s contract looks like? Here. Put out on Monday to mark Christine Lagarde’s first day in the job. (The public circus starts with her first press conference, which comes on Wednesday.) In case you wondered: $467,940 after tax and an annual after-tax allowance of $83,760 “to maintain … a scale of living appropriate to your position as Managing Director,” for which readers are invited to make their own judgments.
Couple of notable changes from previous versions, including that of Dominique Strauss-Kahn. 1. Tighter rules on ethics, including attendance at internal IMF ethics training (not a course for the half-hearted, by the sound of it) 2. Ban on political activism including attending party meetings. Read more
The US is down but not out in Bahrain. Back in March, the Obama administration was frustrated by the regime’s crackdown against a Shia uprising and the sudden arrival of Saudi troops in the kingdom in support of the Sunni monarchy. The Saudi message to the Americans at the time was this: stay out of Bahrain, the royal family and Iran’s attempts to exploit the Shia protests are red lines.
The protests were crushed, as had been expected, amid cries of widespread human rights abuses that further embarrassed the US, for whom Bahrain is a close ally and home of the Fifth Fleet. Read more
In Washington they are arguing about a debt ceiling; in Brussels they are staring into a debt abyss. But the basic problem is the same. Both the US and the European Union have public finances that are out of control and political systems that are too dysfunctional to fix the problem. America and Europe are in the same sinking boat.
As part of the FT’s guide to the best books to read over the coming months, I contributed the following:
On The State of Egypt: What Caused the Revolution, by Alaa Al Aswany, Canongate, RRP£9.99, 208 pages
Al Aswany, an acclaimed novelist, is also a prolific journalist (and a dentist). In the years preceding the Egyptian revolution, he was a fierce critic of the Mubarak regime. This collection of his newspaper columns focuses on Al Aswany’s characteristic concerns – corruption, illiberal fundamentalism, autocracy, torture and the mistreatment of women. It is the authentic voice of Egyptian liberalism. Read more
Good luck to Yingluck, she is going to need it. The electoral victory of Thailand’s Pheu Thai party, led by Yingluck Shinawatra, could bring to an end a turbulent phase in Thai politics. If the Thai establishment and the Bangkok middle-classes accept the opposition’s victory, then the country’s first female prime minister might be able to break the cycle of coups, riots and instability that has plagued Thailand for the first five years. Read more
The revelation that the case against Dominique Strauss-Kahn appears to be unravelling raises an obvious question – is is too late for DSK to resurrect his presidential ambitions? If this were a novel or a TV mini-series, the next step would clearly be for him to return to France, a vindicated man, and to be swept to the presidency. However, reality is likely to be a bit more complicated. Le Figaro are running a poll of their readers, asking whether DSK could yet become president – by roughly two-t0-one, they feel that the answer is No. And that, surely, must be where the odds lie. Read more
Welcome to the live blog where we are covering developments in the case of Dominique Strauss-Kahn (DSK), the former head of the International Monetary Fund.
All times are London time; New York is five hours behind. By Peggy Hollinger and James Boxell in Paris, Esther Bintliff in London and Barney Jopson and Johanna Kassel in New York.
21.22: Barney Jopson says DSK is still in New York and at lunch, apparently, at the TimeWarner Centre at Columbus Circle, which happens to be home to CNN.
Hang on, whispers that he’s now on his way back. Read more
I don’t know whose bright idea it was to schedule peace talks with the Taliban in Munich. But somebody with a sense of history might have avoided that location. Ever since Chamberlain and Daladier signed over the Sudetenland to Hitler there in 1938, the phrase “Munich agreement” has had an unfortunate ring to it. Read more