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Barack Obama knows a thing or two about winning elections and having pressed Italy’s Mario Monti into running for prime minister in next month’s elections, the US president is also lending some advice.
Mr Monti, long-time economics professor and former EU commissioner who was appointed technocrat prime minister in late 2011, has never run for elective office in his life, and it shows.
Enter David Axelrod, Mr Obama’s two-time campaign strategist, who responding to a report in Turin’s La Stampa, confirms to my FT Washington colleague Richard McGregor that his old firm AKPD Message and Media has been hired by Mr Monti. Mr Axelrod says he had been retained “to take a look and come in for a day to meet with Monti and his team, which I did.” He adds for transparency’s sake: “I no longer have an interest in AKPD.” Read more
The future of the UK in the EU is, of course, already a subject of fierce debate. Everybody can see that the chances of a British departure have increased. The question is by how much.
I was interested to discover from a private conversation with a very senior continental official that his worry is that the rest of the EU really does not need this diversion of attention from its immediate concern, which is the reform of the eurozone.
He referred to two specific risks.
First, he is worried that the very fact that the UK may be on the way out will shake confidence in the future of the eurozone. As he noted, people in Asia or the Americas do not understand the details. They will just regard this British decision as calling into question the vitality of the European project, partly, no doubt, because the UK has deep relations with these parts of the world. Read more
The financial panics are over. Now we must deal with the longer-term aftermath.
I advanced this thesis at a private dinner last night and, to my surprise, Nouriel Roubini agreed with me. More precisely, he agreed that “tail risk” had been sharply reduced.
The big change of the last 12 months has, of course, been in the eurozone. This has something to do with policy improvements in vulnerable countries, particularly Italy and Spain. It has even more to do with the willingness of the European Central Bank, under the redoubtable Mario Draghi, to use its power to reduce break-up risk and offer potentially unlimited liquidity to banks and sovereigns under stress. Read more
By Jasmine Whitbread, chief executive of Save the Children
David Cameron’s speech yesterday was a source of much speculation, interpretation and voicing of opinions here at Davos, even though delivered in London. This is hardly surprising when so much hangs in the balance, not just for the future of the UK but for Europe too.
A lot is also at stake in the UK prime minister’s next speech, starting soon here. Some 2.3 million children’s lives each year, 20 percent of earning power and up to 3 percent of countries’ GDPs. This is the impact of global malnutrition on today’s children and tomorrow’s workforce.
During the height of Olympic fever last year, Cameron hosted a Hunger Summit where global leaders pledged to reduce the number of children left stunted by malnutrition by 25 million by the next Olympics in 2016. I’m hoping Cameron will keep the momentum going by announcing today a follow-up meeting in advance of the G8. This hidden issue needs the attention of the G8 and G20. Read more
By Jasmine Whitbread, chief executive of Save the Children
The funny thing about the whole concept of the World Economic Forum bringing together all these different people from different countries and sectors, is that I’m not sure they actually talk to each other.
At a lunch on East vs (sic) West the packed room looked pretty thin on non-anglos, while a series of men offered mono focal views of just Europe, just China and just the US (and at the end a prominent FT journalist pronounced that he had never heard such outrageous claims).
I noticed today (prompted by a trek out of town to meet the Ethiopians) that different continents hang out in different hotels. An exception would be my hotel where there are fellow Brits plus Koreans – but we never talk and breakfast is conducted in earie silence. Read more
As our colleagues in the mountains don boots, bobble hats and gloves for day two of Davos, here’s some reading material from the comfort of the FT’s London office to help you limber up for Thursday’s talk-fest.
David Cameron’s speech yesterday on Britain’s future in Europe provided much fodder for journalists – with reaction from leaders across the continent and further. Le Monde’s Marc Roche takes the theme of tact to interpret his speech, while in Der Spiegel Christoph Scheuermann argues that Cameron “missed an opportunity on Wednesday to haul Britain back to the centre of Europe“. The New York Times’ Andrew Higgins writes that “while the acute phase of the financial crisis has passed, the challenge to Europe’s mission and even its membership has not”. Cameron will be taking to a podium again this morning, this time in Davos. Read more
Coverage of Thursday’s highlights at the World Economic Forum will include contributions from Angela Merkel, David Cameron and Henry Kissinger, brought to you by the FT’s team of reporters and columnists in Davos and by Ben Fenton, Claire Jones and Lina Saigol in London.
18.00: The Davos live blog is closing down for Thursday. For more reading and insight on today’s events, please visit the FT’s in-depth page on the World Economic Forum. We will be back with Friday’s highlights, including world wide wisdom from Sir Tim Berners-Lee and central forethought from Mario Draghi.
17.30: Gillian Tett reports on her own Davos session this morning and its compelling insights into China’s future:
One of the big guessing games in Davos this year is whether China will be able to maintain a growth rate of 8 per cent a year. But today I had a chance to interview Li Daokui, the renowned Chinese economist and former central bank official – and he insisted during the Davos event that the 8 per cent growth debate is entirely the wrong thing to worry about.
In the short to medium term, Li argued, there is every reason to expect China to keep expanding at a healthy pace since the economy is still “catching up” with other countries and it is rebalancing away from export-lead growth towards domestic consumption at a much faster pace than most Western observers recognise. And while many Western economists argue that the official statistics overstate the pace of growth, Li thinks that the data is pretty accurate: even if some state activity is inflated, that is being balanced by the fact that swathes of the “informal” Chinese economy are being under-recorded.
However, Li argued that the really big issue now is what model China will want to emulate in the future: will it be more “capitalist” like America, or more state-controlled like Singapore (or, a cynic might suggest, something more wild, like Russia). Unsurprisingly, perhaps, Li thinks that Singapore is the best option. But he stressed that it remains unclear whether the new leadership will be ready to embrace the radical reforms that he thinks will be needed in China over the next decade; it is also unclear whether public opinion in China will permit this. And while the citizens are not expressing their views via the ballot box, Li says it is a mistake to think that popular views do not count. Whereas America relies on democracy to test public views, China is now using Twitter, he argues: the social media forum has become such a crucial weather vane of public sentiment that it is being closely watched by top Chinese officials, and influencing policy. And it is not just politicians who are Twitter-focused: Li himself currently has some 5m Twitter followers, who are eagerly reading his economic tweets.
It is a fan club that even Beyoncé would be excited about; let alone any of the Western economists who are in Davos this week.
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Gideon Rachman is away until September 1st, working on a special project.