- The Only Way Out Of The Qatar Crisis
Authored by Ahmed Chari via The Strategic Culture Foundation,
Qatar has been known for years as a small peninsula nation that punches far above its weight. Its immense oil wealth and enormous influence, through its English- and Arabic-language Al Jazeera channels, have given it diplomatic clout across the Arab world. Its soft power has been felt in negotiations in Darfur, Tripoli, Sanaa and elsewhere. Everywhere it has been either admired or envied.
Now Qatar is on its back feet, fighting off criticism from all sides. Qatar’s candidate to run UNESCO is now almost certain to lose; a few months earlier, he was the frontrunner. Activists are pressing FIFA to bar Qatar from hosting the World Cup. Pressure is mounting to close the U.S. air base in Qatar; U.S. Air Force general Charles Wald, who opened the base in 2001, is now, in retirement, publicly calling for its closure. A coalition of thirty-four thousand predominantly African American churches protested Qatar in Washington, DC, on June 28, citing Qatar’s persecution of Christians, Jews and other religious minorities. (Qatar bans crosses on the outside of churches and bars public prayer by Christians, even though there may be more Christians in the country than the three hundred thousand native Qataris.) The protest, outside Qatar’s embassy at Twenty-Fifth and M Streets, is the first-ever public demonstration against Qatar in Washington. It won’t be the last.
Even more dramatically, Qatar’s neighbors and allies have turned against it. Saudi Arabia, Egypt, Bahrain and the United Arab Emirates have cut diplomatic ties with Qatar and closed their air and sea ports to Qatar’s planes and ships. The Arab-language media is full of venom directed at Qatar. Now it is either pitied or feared.What happened? Qatar was found to be funding the enemies of America and its Arab allies. Washington policymakers are concerned that Qatar has funded, according to the U.S. State department, Al Qaeda affiliates in Syria as well as elements of ISIS—the very groups America is bombing in its campaign to liberate northern Iraq. It also supports Hamas, which both the United States and EU have designated as a terrorist organization. Bahrain believes that Qatar is supporting armed opposition groups against its royal family. The Saudis fault Qatar’s financial support to the Yemen-based Houthi rebels (opposed to the Saudi regime) as well as Qatar’s backing for violent opposition groups in the Saudi province of Al Qatif, which is mostly Shia.
Meanwhile, Qatar has offered a sanctuary to the Muslim Brotherhood and known terrorists. The oil sheikhdom also shelters the Muslim Brotherhood’s spiritual guide, Yusuf al-Qaradawi; Khaled Meshal, who was until recently the leader of Hamas; and Abbassi Madani, an Algerian Islamist leader—as well as many Taliban leaders. Nor was Qatar simply giving these extremists a roof and a cot. It gave them a platform, through Al Jazeera, to raise funds, woo followers and boost their prestige.
All of this duplicity and support might have been tolerable, as it too often was before the September 11 attacks, were it not for the Arab world’s confrontation with Iran. The Islamic Republic is already engaged in both a direct and a proxy war against the Sunni states. Iran’s state-run broadcasts refer to Bahrain as Iran’s “eighteenth province,” even though Persians have not ruled there for some three centuries, and call on believers to end Saudi control over the Muslim holy places in Mecca and Medina. The UAE has a bitter territorial dispute with Iran. And let’s not forget that Iran is developing atomic weapons and the missiles to carry them; it may be planning to settle its religious and regional arguments with a Hiroshima-style blast.In contrast with its neighbors’ conflicts with Iran, Qatar is in business with the Islamic Republic. It shares with Iran the Pars Sud gas field, one of the world’s largest.
While Iran was under embargo, Qatar continued to sell Iranian natural gas to Europe. The shared gas field gave Qatar the perfect cover to help its partner in crime, Iran. Yet shipping by sea is slow, costly and risky. Qatar proposed a pipeline across Syria to move Iran’s energy products (as well as its own) to the power-starved European market. A pipeline would have cut costs while strengthening Qatar’s hand. The Syrian dictator soon put an end to this pipe dream.
In short, Qatar’s support for Iran was the last straw for its neighbors. The U.S. State Department is trying to be neutral, and is asking for evidence of Qatar’s transgressions. Meanwhile, President Donald Trump has been far clearer: he has demanded that Qatar stop funding America’s enemies.
Clearly, Qatar must stop opening the money spigot for groups designated as terrorists by its allies, and it should turn over the terror leaders it is hosting to face justice in their native lands.
The U.S. State Department should also invite Morocco to help. Iran, and indirectly Qatar, is backing armed uprisings by minority Shia groups across the Sunni-majority Arab world. Morocco’s king, Mohammed VI, is also his kingdom’s supreme religious ruler. His words and moderate religious teachings have calmed restive Shia populations and inspired them to oppose violence. Under the king’s leadership, Morocco is now enjoying a new influence in Africa. Mohammed VI, as a spokesman for political and religious moderation, is an important voice to combat Shia uprisings and Sunni reprisals.
Qatar must stop fanning the flames of Islamic division, and Morocco and the Gulf Arabs should be given a real chance to head off a religious civil war between Sunnis and Shia, which could cost millions of lives in a war that could drag on for decades.
We have come to a time when confrontation with Qatar will produce peace, and compromising will lead to war. Trump’s instincts are right. If Qatar doesn’t change, the world around it will.
- Illinois House Approves Historic 32% Tax Increase, Governor Vows Veto
With Illinois, which on Saturday morning entered its third fiscal year without a budget, facing a catastrophic downgrade, late on Sunday evening the Illinois House approved the most controversial element of a budget package, a tax hike which will increase the income tax rate by 32% from 3.75% to 4.95%, and the corporate income tax rate from 5.25% to 7%, to try and end a historic budget impasse. The bill passed 72-45. The House also approved a $36 billion spending plan minutes later on a 81-34 vote. According to the Sun Times, it cleared an initial hurdle on Friday with 23 Republicans voting “yes.”
“While no one could say this was an easy decision, it was the right decision,” House Speaker Mike Madigan said after the spending bill vote. “There is more work to be done.” Dems said they would work with Republicans on other resolution of other issues on table.
The proposed tax increase will now head back to the Illinois Senate, which approved a revenue bill on May 23 with all Democratic votes as part of its “grand bargain” package. But Governor Bruce Rauner has said he’ll only support an income tax hike if it’s limited to four years and paired with a four-year property tax freeze. He’s also still seeking changes in workers’ compensation and pensions.
Commenting on the just passed House bill, Rauner said he’ll veto the revenue bill.
“I will veto Mike Madigan’s permanent 32% tax hike. Illinois families don’t deserve to have more of the hard-earned money taken from them when the legislature has done little to restore confidence in government or grow jobs,” Rauner said.
“Illinois families deserve more jobs, property tax relief and term limits. But tonight they got more of the same.” He also said in an emailed statement that “if the legislature is willing to pass the largest tax hike in state history with no reforms, then we must engage citizens and redouble our efforts to change the state.”
Some commentators promptly countered that Rauner’s veto will likely be overriden.
The tax bill passed with some essential Republican support: it needed 71 votes. But Illinois House Republican Leader Jim Durkin questioned how it will address the state’s $14 billion backlog. Durkin is seeking to get Rauner the “balanced budget package,” he wants, which includes spending reductions and “meaningful reforms.”
“I am disappointed that we’re taking this up at this moment when there has been significant, significant progress to address the priorities of the governor and also the priorities of this caucus,” Durkin said.
There are, of course, political ramifications to supporting a tax hike, on both sides of the aisle. Some House Democrats were expected to vote no to try to shield themselves from Illinois Republican Party attacks in next year’s election. But some House Republicans, knowing they’d too be targeted for supporting it. said there’s no other choice.
Others were even more fatalistic: “If I lose my seat so be it,” state Rep. Michael Unes, R-Pekin said, adding the state shouldn’t have gotten so close to a financial collapse. “Without this, we will lose thousands of lives and thousands of jobs and the alternative is so much worse. I don’t like this. This is not easy. This is really, really difficult,” Unes said. “But the alternative is much worse than this. The alternative is literally taking our state off the cliff.”
David Harris was among the Republicans who supported the bill, while also urging the governor to sign the revenue and spending bills if passed: “Have the courage to do what is right and bring this madness to an end.”
“I was not elected as a state legislator to help preside over the financial destruction of this great state,” Harris said. “I respect my colleagues who are voting no. But to me, enough is enough.”
Meanwhile, changes made by House Democrats from the original Senate bill include the removal of streaming and satellite fees. It also closed corporate tax loopholes, increased the earned income tax credit, and restored the research and development and manufacturers’ tax credit to attract more businesses.
House Democrats filed amendments to both the tax and spending measures on Sunday, which included nearly $400 million more in cuts. Although some House Republicans voiced frustrations over changes, House Democrats said they were reflective of topics discussed during negotiations.
It is unclear if the passed tax increase will be sufficient to placate S&P. Recall July 1 was the date when the credit agencies said they would drop the state to “junk” status without a budget. Ultimately, the fate of Illinois’ credit rating is now in the hands of Rauner, and whether and how fast his imminent veto is overriden.
Ultimately, Illinois faces a lose-lose dilemma: get junked and see its funding costs soar, or save its lowest possible investment grade rating, and watch as what is already the worst metropolitan exodus (recently the population of Chicago shrank the most of any US city), go into overdrive as tens of thousands more scramble to escape the state’s soaring tax rates.
- The Crash Of 1929: "Somewhere, Deep Down, They Knew The Party Was Over"
Via Jesse's Cafe Americain blog,
History may not repeat… but it sure ryhmes…
"…people believed that everything was going to be great always, always. There was a feeling of optimism in the air that you cannot even describe today."
"There was great hope. America came out of World War I with the economy intact. We were the only strong country in the world. The dollar was king. We had a very popular president in the middle of the decade, Calvin Coolidge, and an even more popular one elected in 1928, Herbert Hoover. So things looked pretty good."
"The economy was changing in this new America. It was the dawn of the consumer revolution. New inventions, mass marketing, factories turning out amazing products like radios, rayon, air conditioners, underarm deodorant…One of the most wondrous inventions of the age was consumer credit. Before 1920, the average worker couldn't borrow money. By 1929, "buy now, pay later" had become a way of life."
"Wall Street got the credit for this prosperity and Wall Street was dominated by just a small group of wealthy men. Rarely in the history of this nation had so much raw power been concentrated in the hands of a few businessmen…"
"One of the most common tactics was to manipulate the price of a particular stock, a stock like Radio Corporation of America…Wealthy investors would pool their money in a secret agreement to buy a stock, inflate its price and then sell it to an unsuspecting public. Most stocks in the 1920s were regularly manipulated by insiders "
"I would say that practically all the financial journals were on the take. This includes reporters for The Wall Street Journal, The New York Times, The Herald-Tribune, you name it. So if you were a pool operator, you'd call your friend at The Times and say, "Look, Charlie, there's an envelope waiting for you here and we think that perhaps you should write something nice about RCA." And Charlie would write something nice about RCA. A publicity man called A. Newton Plummer had canceled checks from practically every major journalist in New York City… Then, they would begin to — what was called "painting the tape" and they would make the stock look exciting. They would trade among themselves and you'd see these big prints on RCA and people will say, "Oh, it looks as though that stock is being accumulated. Now, if they are behind it, you want to join them, so you go out and you buy stock also. Now, what's happening is the stock goes from 10 to 15 to 20 and now, it's at 20 and you start buying, other people start buying at 30, 40. The original group, the pool, they've stopped buying. They're selling you the stock. It's now 50 and they're out of it. And what happens, of course, is the stock collapses."
"The pools were a little like musical chairs. When the music stopped, somebody owned the stocks and those were the sufferers. If small investors suffered, they would soon be back for more. They knew the game was rigged, but maybe next time, they could beat the system. Wall Street had its critics, among them economist Roger Babson. He questioned the boom and was accused of lack of patriotism, of selling America short."
"Roger Babson warned of the speculation and said, "There's going to be a crash and the aftermath is going to be quite terrible." And people jumped on Babson from all around for saying such a thing, so that people who were cautious about their personal reputation, who did not want to call down on themselves a lot of calumny, kept quiet."
"Politicians came and went, but in the 20s, the businessman was king."
"With everyone trying to borrow money to cover the falling value of their stocks, there was a credit crunch. Interest rates soared. At 20 percent, few people could afford to borrow more money. The boom was about to collapse like a house of cards."
"…the National City Bank would provide $25 million of credit…immediately, the credit crisis was alleviated. In fact, within the next 24 hours, call money went from 20 percent to eight percent and that stopped the panic, then, in March [1929]"
"Everything was not fine that spring with the American economy. It was showing ominous signs of trouble. Steel production was declining. The construction industry was sluggish. Car sales dropped. Customers were getting harder to find. And because of easy credit, many people were deeply in debt. Large sections of the population were poor and getting poorer."
"Just as Wall Street had reflected a steady growth in the economy throughout most of the 20s, it would seem that now the market should reflect the economic slowdown. Instead, it soared to record heights. Stock prices no longer had anything to do with company profits, the economy or anything else. The speculative boom had acquired a momentum of its own."
"It was this nature of mass illusion. Prices were going up, people bought. That forced prices up further, that brought in more people. And eventually, the process becomes self-perpetuating. Every increase brings in more people convinced of their God-given right to get rich."
"The 20s was a decade of all sorts of fast money schemes. Three years earlier, everyone was buying Florida real estate. As prices of land skyrocketed, more people jumped in, hoping to make a killing. Then, overnight, the boom turned to bust and investors lost everything."
"On September 5th, economist Roger Babson gave a speech to a group of businessmen. 'Sooner or later, a crash is coming and it may be terrific.' He'd been saying the same thing for two years, but now, for some reason, investors were listening. The market took a severe dip. They called it the "Babson Break." The next day, prices stabilized, but several days later, they began to drift lower. Though investors had no way of knowing it, the collapse had already begun."
"…the market fluctuated wildly up and down. On September 12th, prices dropped ten percent. They dipped sharply again on the 20th. Stock markets around the world were falling, too. Then, on September 25th, the market suddenly rallied."
"Reuben L. Cain, Stock Salesman, 1929: I remember well that I thought, "Why is this doing this?" And then I thought, "Well, I'm new here and these people" — like every day in the paper, Charlie Mitchell would have something to say, the J.P. Morgan people would have something to say about how good things were — and I thought, "Well, they know a lot more about this market than I do. I'm fairly new here and I really can't see why it's going up." But then, when they say it can't go down or if it does go down today, it'll go back tomorrow, you think, "Well, they really are like God. They know it all and it must be the way it's going because they say so."
"As the market floundered, financial leaders were as optimistic as ever, more so. Just five days before the crash, Thomas Lamont, acting head of the highly conservative Morgan Bank, wrote a letter to President Hoover. "The future appears brilliant. Our securities are the most desirable in the world."
"Practically every business leader in American and banker, right around the time of 1929, was saying how wonderful things were and the economy had only one way to go and that was up."
"There came a Wednesday, October 23rd, when the market was a little shaky, weak. And whether this caused some spread of pessimism, one doesn't know. It certainly led a lot of people to think they should get out. And so, Thursday, October the 24th — the first Black Thursday — the market, beginning in the morning, took a terrific tumble. The market opened in an absolutely free fall and some people couldn't even get any bids for their shares and it was wild panic. And an ugly crowd gathered outside the stock exchange and it was described as making weird and threatening noises. It was, indeed, one of the worst days that had ever been seen down there."
"There was a glimmer of hope on Black Thursday…About 12:30, there was an announcement that this group of bankers would make available a very substantial sum to ease the credit stringency and support the market. And right after that, Dick Whitney made his famous walk across the floor of the New York Stock Exchange…. At 1:30 in the afternoon, at the height of the panic, he strolled across the floor and in a loud, clear voice, ordered 10,000 shares of U.S. Steel at a price considerably higher than the last bid. He then went from post to post, shouting buy orders for key stocks."
"And sure enough, this seemed to be evidence that the bankers had moved in to end the panic. And they did end it for that day. The market then stabilized and even went up."
"But Monday was not good. Apparently, people had thought about things over the weekend, over Sunday, and decided maybe they might be safer to get out. And then came the real crash, which was on Tuesday, when the market went down and down and down, without seeming limit…Morgan's bankers could no longer stem the tide. It was like trying to stop Niagara Falls. Everyone wanted to sell."
"In brokers' offices across the country, the small investors — the tailors, the grocers, the secretaries — stared at the moving ticker in numb silence. Hope of an easy retirement, the new home, their children's education, everything was gone."
"At the end of 1929, as they celebrated New Year's Eve, all that lay in the future. Nobody knew that the Great Depression was coming — unemployment, bread lines, bank failures — this was unimaginable. But the bubble had burst. Gone was that innocent optimism, the confidence, the illusion of wealth without work. One era had ended. They toasted the coming of the 30s, but somewhere, deep down, they knew the party was over."
- "I'm Concerned For My Friend The President… They Are Going To Find Something"
Authored by Mac Slavo via SHTFplan.com,
Robert Kiyosaki is the well known author of the widely popular Rich Dad, Poor Dad series. As an outside-the-box thinker Kiyosaki has recently suggested that the U.S. economy is under so much pressure that it is in real danger of collapse. He is also a long-time advocate of gold and silver as a way to protect wealth during times of financial calamity. Kiyosaki happens to be a very good friend of President Donald Trump, with whom he has written two books.
In the following interview with Infowars.com, he says that America is not only in serious trouble because of a poor education system, corrupt bureaucrats and socialist-leaning government employees, but that entrenched Deep State elites are feverishly working to take down the President.
In dealing with Donald… he’s straight… he listens… he makes decision quickly…
And I think that’s his Achilles heel… You know, because bureaucrats, all they want is to keep their jobs… they’re not here to get the job done.
So I feel for my friend Donald… he is a great man.. he has the same disease I have… foot and mouth… or Tweet and mouth…
I’m so politically incorrect… that’s what he is… it’s so unfortunate… everybody says ‘well, stop Tweeting.”
Well, it’s Donald… People look at that covfefe he Tweeted… but at the same time he went to NATO and he said to NATO, “pay up… you guys are not paying your bills.”
Then he went to Saudi Arabia and said “let’s kick ISIS’ butt.”
That’s the kind of leader he is… but the press never covers that…
…
Our whole system is suspect right now… it’s all these bureaucrats and people with their hands in pockets… why does a politician go into office poor and leave rich?
How does it happen? That’s corruption… but nobody says anything about that.
…
My concern for my friend the President… they are going to find something… it doesn’t make a difference what they find… they will find something.
Just this week we learned that Democrats in Congress, reportedly with the support of some Republicans, are spearheading a new law that would create an “Oversight Commission on Presidential Capacity.” The committee would be a bi-partisan panel designed specifically to investigate President Trump’s mental health and to oust him under the 25th Amendment of the U.S. Constitution. Considering that non-conformity has now been identified by psychiatrists as a mental disorder, it should be clear, as Robert Kiyosaki warns, that finding a reason, any reason, to get rid of Trump would be a fairly straightforward process with the right people involved in the investigations.
Coupled with a variety of investigations and accusations involving everything from Russian collusion to alleged blackmailing of MSNBC hosts Joe Scarborough and Mika Brzezinski about an Enquirer article, if the Deep State wants to find something, they absolutely will.
- Government Forces Murder 4 More Protesters In Venezuela, Bringing Death Toll To 80
As the oppressive regime of leftist autocrat Nicolas Maduro intensifies its crackdown on anti-government protesters who have been gathering daily in the streets of Caracas and other Venezuelan cities to demand regime change, the government’s body count continues to climb. Last week, one such government-sanctioned killing was caught on video. The chilling footage shows Venezuelan soldiers shooting a 22-year-old rioter in the chest after he hurled rocks at them.
The Associated Press reports that at least four people were killed and eight injured during anti-government protests in central Venezuela on Saturday. The deaths brought to at least 80 the number of people killed since anti-government protests erupted three months ago.
“Chief prosecutor Luis Ortega Diaz confirmed that four deaths occurred Friday in clashes in Barquisimeto. The city’s mayor blamed the deaths on armed militias that support Venezuela’s socialist government.”
The deaths occurred as Ortega Diaz – who has had the temerity to stand up to Maduro and question his late-March decision to dissolve the opposition-controlled National Assembly – asked the Inter-American Commission on Human Rights for protection Friday, days after Venezuela’s Supreme Court barred her from leaving the country and ordered her bank accounts froze, according to the Associated Press.
Ortega Diaz is one of the few remaining Maduro critics who haven’t already been removed from power, challenging Maduro’s push to rewrite the constitution and pressing charges against officers responsible for deaths during anti-government protests.
Her latest crime? Her office announced this past week that it would summon the chief of Venezuela’s feared Sebin intelligence agency, Gustavo Gonzalez, to appear on suspicion of “committing grave and systemic violations of human rights.”
Maduro responded to Ortega Diaz’s decision by promoting Gonzalez to head of the nation’s army.
Here’s more on that from the AP:
Prosecutors said they are investigating incidents of illegitimate detentions, arbitrary raids and cases in which people have remained imprisoned despite court orders that they be freed.
Maduro responded hours later by promoting Gonzalez to head the nation’s army. He called Gonzalez and Antonio Benavides Torres, another high-ranking official under investigation by the state prosecutor, “brave patriots.”
“They have defended the peace of the republic and have all my support,” Maduro said.
Maduro has tightened his grip on power and cracked down on his political opposition as the collapse in oil prices – the Venezuelan government’s primary source of revenue – coupled with years of economic mismanagement by Maduro precipitated an unprecedented economic crisis in the country. The collapse of Venezuela’s currency, the bolivar, which trades on the black market at a rate of nearly 8,000 to the dollar, triggered hyperinflation that has made bare essentials like flour, meat, medicine and toilet paper unavailable to the general population.
- The Real Threat Of Artificial Intelligence – Keynesian Dystopia
Authored by Kai-Fu Lee, originally posted at The New York Times,
What worries you about the coming world of artificial intelligence?
Too often the answer to this question resembles the plot of a sci-fi thriller. People worry that developments in A.I. will bring about the “singularity” — that point in history when A.I. surpasses human intelligence, leading to an unimaginable revolution in human affairs. Or they wonder whether instead of our controlling artificial intelligence, it will control us, turning us, in effect, into cyborgs.
These are interesting issues to contemplate, but they are not pressing. They concern situations that may not arise for hundreds of years, if ever. At the moment, there is no known path from our best A.I. tools (like the Google computer program that recently beat the world’s best player of the game of Go) to “general” A.I. — self-aware computer programs that can engage in common-sense reasoning, attain knowledge in multiple domains, feel, express and understand emotions and so on.
This doesn’t mean we have nothing to worry about. On the contrary, the A.I. products that now exist are improving faster than most people realize and promise to radically transform our world, not always for the better. They are only tools, not a competing form of intelligence. But they will reshape what work means and how wealth is created, leading to unprecedented economic inequalities and even altering the global balance of power.
It is imperative that we turn our attention to these imminent challenges.
What is artificial intelligence today? Roughly speaking, it’s technology that takes in huge amounts of information from a specific domain (say, loan repayment histories) and uses it to make a decision in a specific case (whether to give an individual a loan) in the service of a specified goal (maximizing profits for the lender). Think of a spreadsheet on steroids, trained on big data. These tools can outperform human beings at a given task.
This kind of A.I. is spreading to thousands of domains (not just loans), and as it does, it will eliminate many jobs. Bank tellers, customer service representatives, telemarketers, stock and bond traders, even paralegals and radiologists will gradually be replaced by such software. Over time this technology will come to control semiautonomous and autonomous hardware like self-driving cars and robots, displacing factory workers, construction workers, drivers, delivery workers and many others.
Unlike the Industrial Revolution and the computer revolution, the A.I. revolution is not taking certain jobs (artisans, personal assistants who use paper and typewriters) and replacing them with other jobs (assembly-line workers, personal assistants conversant with computers). Instead, it is poised to bring about a wide-scale decimation of jobs — mostly lower-paying jobs, but some higher-paying ones, too.
This transformation will result in enormous profits for the companies that develop A.I., as well as for the companies that adopt it. Imagine how much money a company like Uber would make if it used only robot drivers. Imagine the profits if Apple could manufacture its products without human labor. Imagine the gains to a loan company that could issue 30 million loans a year with virtually no human involvement. (As it happens, my venture capital firm has invested in just such a loan company.)
We are thus facing two developments that do not sit easily together: enormous wealth concentrated in relatively few hands and enormous numbers of people out of work. What is to be done?
Part of the answer will involve educating or retraining people in tasks A.I. tools aren’t good at. Artificial intelligence is poorly suited for jobs involving creativity, planning and “cross-domain” thinking — for example, the work of a trial lawyer. But these skills are typically required by high-paying jobs that may be hard to retrain displaced workers to do. More promising are lower-paying jobs involving the “people skills” that A.I. lacks: social workers, bartenders, concierges — professions requiring nuanced human interaction. But here, too, there is a problem: How many bartenders does a society really need?
The solution to the problem of mass unemployment, I suspect, will involve “service jobs of love.” These are jobs that A.I. cannot do, that society needs and that give people a sense of purpose. Examples include accompanying an older person to visit a doctor, mentoring at an orphanage and serving as a sponsor at Alcoholics Anonymous — or, potentially soon, Virtual Reality Anonymous (for those addicted to their parallel lives in computer-generated simulations). The volunteer service jobs of today, in other words, may turn into the real jobs of the future.
Other volunteer jobs may be higher-paying and professional, such as compassionate medical service providers who serve as the “human interface” for A.I. programs that diagnose cancer. In all cases, people will be able to choose to work fewer hours than they do now.
Who will pay for these jobs? Here is where the enormous wealth concentrated in relatively few hands comes in. It strikes me as unavoidable that large chunks of the money created by A.I. will have to be transferred to those whose jobs have been displaced. This seems feasible only through Keynesian policies of increased government spending, presumably raised through taxation on wealthy companies.
As for what form that social welfare would take, I would argue for a conditional universal basic income: welfare offered to those who have a financial need, on the condition they either show an effort to receive training that would make them employable or commit to a certain number of hours of “service of love” voluntarism.
To fund this, tax rates will have to be high. The government will not only have to subsidize most people’s lives and work; it will also have to compensate for the loss of individual tax revenue previously collected from employed individuals.
This leads to the final and perhaps most consequential challenge of A.I. The Keynesian approach I have sketched out may be feasible in the United States and China, which will have enough successful A.I. businesses to fund welfare initiatives via taxes. But what about other countries?
They face two insurmountable problems. First, most of the money being made from artificial intelligence will go to the United States and China. A.I. is an industry in which strength begets strength: The more data you have, the better your product; the better your product, the more data you can collect; the more data you can collect, the more talent you can attract; the more talent you can attract, the better your product. It’s a virtuous circle, and the United States and China have already amassed the talent, market share and data to set it in motion.
For example, the Chinese speech-recognition company iFlytek and several Chinese face-recognition companies such as Megvii and SenseTime have become industry leaders, as measured by market capitalization. The United States is spearheading the development of autonomous vehicles, led by companies like Google, Tesla and Uber. As for the consumer internet market, seven American or Chinese companies — Google, Facebook, Microsoft, Amazon, Baidu, Alibaba and Tencent — are making extensive use of A.I. and expanding operations to other countries, essentially owning those A.I. markets. It seems American businesses will dominate in developed markets and some developing markets, while Chinese companies will win in most developing markets.
The other challenge for many countries that are not China or the United States is that their populations are increasing, especially in the developing world. While a large, growing population can be an economic asset (as in China and India in recent decades), in the age of A.I. it will be an economic liability because it will comprise mostly displaced workers, not productive ones.
So if most countries will not be able to tax ultra-profitable A.I. companies to subsidize their workers, what options will they have? I foresee only one: Unless they wish to plunge their people into poverty, they will be forced to negotiate with whichever country supplies most of their A.I. software — China or the United States — to essentially become that country’s economic dependent, taking in welfare subsidies in exchange for letting the “parent” nation’s A.I. companies continue to profit from the dependent country’s users. Such economic arrangements would reshape today’s geopolitical alliances.
One way or another, we are going to have to start thinking about how to minimize the looming A.I.-fueled gap between the haves and the have-nots, both within and between nations. Or to put the matter more optimistically: A.I. is presenting us with an opportunity to rethink economic inequality on a global scale. These challenges are too far-ranging in their effects for any nation to isolate itself from the rest of the world.
- The World Is Questioning Trump's Leadership
According to a new study from Pew Research which polled 40,000 people in 37 nations, Donald Trump's presidency has had a "major impact on how the world sees the United States".
You will find more statistics at Statista
As Statista's Niall McCarthy notes, three quarters of those polled had little to no faith in the U.S. president doing the right thing for world affairs compared to an unimpressive 22 percent who have a great deal of confidence in him. Broken down on a country by country basis, majorities of respondents in Israel and Russia were confident about Trump's leadership abilities but nearly every other nation displayed a high degree of skepticism.
Across the board, Obama's perfomance on the world stage is generally held in higher regard than Trump's. People were polled at the end of Obama's eight-year term and 88 percent of Germans, 83 percent of Canadians and 79 percent of people in the UK were satisfied with his global leadership.
When asked about Trump's presidency, on the other hand, only 11 percent of Germans and 22 percent of those in Canada and the UK had faith in his global leadership.
- Gunmen Open Fire On Crowd Outside Mosque In Avignon, France
A shootout erupted around 10:30pm on Sunday night in Avignon, southern France, when two gunmen opened fire on a crowd outside the Arrahma mosque leaving either people injured, La Provence newspaper reports.
Gunmen open fire on crowd outside mosque in France leaving eight injured – Mirror Online https://t.co/dLQ6GMVRpA
— Tommy Robinson ???????? (@TRobinsonNewEra) July 2, 2017
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According to initial reports, two hooded men were seen arriving aboard a Renault Clio. One was armed with a handgun, the second a rifle. As a crowd oe people were leaving the mosque, one of the armed men, who had got out of his vehicle, opened fire.
La Provence adds that at least four people were injured at the time, while subseqeuent reports said the number is at least eight. About fifty meters away, a family of four who was in her apartment on the second floor of a building also received shrapnel. A 7-year-old girl was slightly injured.
Police in Avignon are now searching for the suspects who fled the scene.
The police have said they do not suspect terrorism is a motive behind the attack. The permanent magistrate at the Avignon parquet, Laure Chabaud, said the working hypothesis is a settling of accounts or a quarrel between young people.
- Make It Liquid, Please
By Chris at www.CapitalistExploits.at
Most of you know the story of Africa’s great jewel.
Zimbabwe, presided over by the charming, charismatic, democratically elected leader Robert Mugabe.
So great is the country that under his leadership it has reached dizzying heights. The highest inflation in Africa, the highest unemployment in Africa, and, of course, the highest rates of poverty, which on the dark continent is really quite something.
Think about it, your neighbouring nations are themselves doing such a sterling job of raping and pillaging the populace and destroying wealth even before its past incubation point that in order to beat them you’d be forced to work so hard you’d probably have to quit drinking on the job.
It was under this backdrop that in late 2009 I, together with a bunch of mining engineers from South Africa and some ex-military gents, sensed opportunity.
You see, Zim had been running a government program which released its white citizens of the cumbersome obligations of ownership of all sorts of assets – things like farms, factories, land, and mines. And THIS was what we were interested in – gold mines to be precise. Many, but not all, of these assets had landed up in the hands of Mugabe’s henchmen. Many “whities” with a strongly held desire to keep their heads attached to their shoulders while simultaneously being mad as hell realising that all they’d worked for was to go to some illiterate thug with a panga and an IQ of 70 essentially had two options.
A small number actually took to a scorched earth policy. They sold what they could and destroyed everything they’d worked for as they were unwilling to see it go to thieves.
Others went the legal route of transferring land titles to blacks. In doing so, they got to choose the new land owners and so typically handed the assets over to longtime loyal employees, farm managers, mine managers, and so forth. The assets, now in the hands of black Zimbabweans, were that much safer from roaming thugs targeting white owned assets. The previous owners (those who could) fled to wherever they could. Amazingly, even previously war torn Mozambique received an influx of white talent though many went to Europe or South Africa. Pretty much anywhere looked better. Some had no options (no foreign passports) and either died or still eek out a living in the country today.
What’s the Liquidity on an Asset No Sane Person Would Want?
That’s the question we asked ourselves… figuring it to be near zero.
As a white non-Zimbabwean citizen (actually white Zim citizens were and are in the same boat) you really didn’t want to “own” these assets. You wanted to control them but you sure as hell didn’t want to own them.
The black guys who ended up with the assets couldn’t quite figure this out, the mindset being that they now had gone from having few assets to owning massive operations which were only a few years prior worth tens or hundreds of millions of dollars. So they just wanted to cash in and sell them.
It’s worth mentioning that most of these poor guys had no financial acumen at all, and when we explained to them that we placed the assets in the liability column on the balance sheet (they needed to be maintained, which costs money) we drew blank stares. A balance sheet wasn’t something they knew too much about but when it sunk in that we believed the assets to be worthless unless we could go through an extraction of product, they realised that they’d have to go back to work (producing on a revenue share) they weren’t overjoyed. Visions of big houses, Land Cruisers, and holidays in Europe seemed further out of reach.
Those assets in Zimbabwe can’t be easily bought or sold due to Mugabe and his minions creating all sorts of headaches requiring copious bottles of Klipdrift (a South African brandy) and a certain amount of hard currency changing hands with “officials”. That’s if they don’t just simply take what they want outright. The impact on liquidity of assets is typically like that of a safe being dropped on your guts. Oofff!
Now, this is where it gets interesting.
Liquidity should have been zero. After all, what white guy would want to buy something that could and probably would be stolen from under him within a few years, if not months, and could quite easily involve the removal of his head from his shoulders?
But It Wasn’t…
Enter some other gents going by the names of Ivan, Anatoly, and Vsevolod.
These guys descended on Zimbabwe in waves. Perhaps there was a flyer in Moscow. Our own “soldier of fortune” explained to us where these guys came from and even some of their history, which was fascinating to me since he knew so much from just watching them across a table at a restaurant.
Any dope could see they were well dressed thugs who could snap you in two without taking their attention off their lunch but it turns out that tattoos reveal a lot. Apparently when you leave the employ of the KGB or Spetznaz your employment options are somewhat limited. Mercenary work in 3rd world hell holes looks and pays a lot better than licking stamps at the post office and smiling at Babushkas.
Anyway, the Russkies, after enjoying the collapse of the Soviet Union had a template on how to deal with such opportunities. You roll into town, use overwhelming muscle, and secure assets, then strip them and sell them. Hey, it worked in the ex-USSR, so why not Zim?
Indeed, why not?
Ivan and his mates were working for whatever “brains” had employed them, and they actually just went in and paid cash for all sorts of stuff. No need for any limbs to get snapped. This, as it turns out, was an excellent example of a truly terrible idea, and Ivan and most of his buddies have since departed, their tails between their legs. A few still hold onto assets (because nobody will buy them) which they paid waaaay too much for and to which their particular “skillsets” are not well suited.
It became patently clear that these guys firstly had money to burn (presumably “acquired” by conducting other “business”)and didn’t seem to have a plan as to what to do once they’d bought the new assets. Clearly they wanted to just sell them on, and in the beginning, many “Ivans” approached our group with this in mind. Perhaps not giving thought to why on earth we, for our part, would pay a premium price on an asset which would could just as easily have bought (and indeed passed on) ourselves.
The point here is that even though liquidity of the assets should have been rock bottom it wasn’t… yet.
There is a solution here to all of this which we found, though it still had liquidity issues. How do you go about creating value in such a setup? The ultimate answer I think lies in code. Yup, computer code.
Now, keep that story in mind because later this week, I’ll explain to you another weird thing that happened in Mugabe’s paradise. Both of these are important due to an entirely new technology that you’ve probably heard about but perhaps haven’t given much thought to.
– Chris
“Focus on the movement of liquidity… most people in the market are looking for earnings and conventional measures. It’s liquidity that moves markets.” — Stanley Druckenmiller
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