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      Rowing Together to Tackle Inequality

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      Beyond the health consequences of the pandemic, evidence shows that the COVID-19 crisis may result in increasing the levels of poverty and inequality for years, if not generations. This outcome is not inevitable. However, insufficient responses to the crisis have deepened inequalities both between and within countries and intensified public discontent, paving the way to “social turmoil and unrest,” says research Bruno Valerio.

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      The costs of the pandemic are being borne disproportionately by poorer categories of society since low-income households are more exposed to health risks and more likely to experience job losses and sharp declines in wellbeing. At the same time, the pandemic has been a boon for the wealthy. In response to the economic collapse in March and April 2020, central banks injected enormous amounts of liquidity into financial markets, keeping asset prices high while economic activity slowed down. Some of the biggest winners were those with high stakes in the technology sector.

      Against this background, Kara Tan Bhala, the founder of the Seven Pillars Institute for Global Finance and Ethics, suggests using the Gini coefficient as a measure of how close a country or the world is to economic upheaval. “The Gini coefficient gauges the income inequality of a region, where 0 corresponds with perfect equality and 1 corresponds with perfect inequality,” she says. “Perhaps nations begin seriously reforming economic policies when their Gini coefficients are above 0.4 (United States) and red lights start flashing trouble when a country scores above 0.5 (South Africa, Brazil).”

      But how do we tackle inequality? According to economist Etienne Perrot, “the adequate responses must … address both property [ownership] rights through anti-trust regulations to counter the abuse of a dominant position, policies through redistributive taxes and education so as not to confuse emulation and competition.” Other policy responses may include “reforms of the transparency and other features of firm governance, broader acceptance of countries’ right to control cross-border capital movements,” as Andrew Cornford points out.

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      To implement these policies, the first condition is that inequalities should be on the political agenda, which is not the case everywhere, as professor Yuriy Temirov illustrates with the case of Ukraine. But policy measures alone are not sufficient to reduce inequalities. They have to be complemented by a cultural, transformative process for learning to “row together” (Fratelli tutti), as Domingo Sugranyes of the Pablo VI Foundation says, to increase our socioeconomic resilience.

      By Virgile Perret and Paul Dembinski

      Note: From Virus to Vitamin invites experts to comment on issues relevant to finance and the economy in relation to society, ethics and the environment. Below, you will find views from a variety of perspectives, practical experiences and academic disciplines. The topic of this discussion is: Inequalities seem to accelerate in every part of the world due to COVID-19 and other issues. Unlike the climate debate, in social issues, we do not have a proper threshold for catastrophe. This leads to a possible overestimation of social resilience and leaves the issue as such largely untackled. Drawing on the particularities of your region or on your area of expertise, what should/can be done?

      “… perfectly predictable socioeconomic inequalities … ”

      “The pandemic only reveals perfectly predictable socioeconomic inequalities. Pope Francis had alerted the international community as soon as the first vaccines appeared. The causes of these glaring social inequalities mix the institutional side through the right of property, the politics increasingly tempted by nationalism, and the spiritual bathed in the materialistic individualism of modernity. The adequate responses must therefore address both property right through anti-trust regulations to counter the abuse of a dominant position, policies through redistributive taxes and education so as not to confuse emulation and competition, distinguishing between the elite and the financial success.”

      Etienne Perrot — Jesuit, economist and editorial board member of the Choisir magazine (Geneva) and adviser to the journal Etudes (Paris)

      “… the Gini coefficient as a measure of how close a country is to economic upheaval… ”

      “In the global climate crisis, anything over 2°C above the average pre-industrial temperature leads to unmitigated disaster. In a similar vein, I suggest we use the Gini coefficient as a measure of how close a country or the world is to economic upheaval. The Gini coefficient gauges the income inequality of a region, where 0 corresponds with perfect equality and 1 corresponds with perfect inequality. Perhaps nations begin seriously reforming economic policies when their Gini coefficients are above 0.4 (United States) and red lights start flashing trouble when a country scores above 0.5 (South Africa, Brazil). Of course, these watershed levels need further research, but it would be enlightening to have an idea of the income inequality thresholds of social disaster.”

      Kara Tan Bhala —president and founder of the Seven Pillars Institute for Global Finance and Ethics

      “… public support will be essential to act to avert a total catastrophe … ”

      “Despite its importance, GDP as an indicator should no longer be the only way we measure economic success. Fairer economy would mean tackling health inequalities and getting to grips with issues that prevent individuals from certain ethnic or socioeconomic backgrounds meeting their full potential. We need to embrace means of improving wellbeing and advancing social mobility, build on promoting social inclusion as well as addressing poverty. New plans must be put in place to achieve a more sustainable economy in a more equal and socially just society, and this cannot just be an aspiration — it must be seen as critical to our survival. In recognizing the profound challenges, public support will be essential to act to avert a total catastrophe. The coronavirus is still alive, and risk lies in whether this will be possible.”

      Archana Sinha — head of the Department of Women’s Studies at the Indian Social Institute in New Delhi, India

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      “… rowing together (Fratelli tutti) …”

      “I don’t see a theoretical answer to this extremely vast question. My reaction can only be in terms of (modest) action-oriented commitment: ‘rowing together’ (Fratelli tutti), i.e., trying to identify social projects of high solidarity value, which help people to emerge from poverty on their own capabilities, and look for means — money, goods, time — in order to increase the scope and impact of such communities. We need business and people in business to get much more decidedly involved in these kinds of projects. This is, among many other organizations, what we try to do with The Voluntary Solidarity Fund (VSF International) and VSF Spain. Everybody is welcome to join.”

      Domingo Sugranyes — director of a seminar on ethics and technology at Pablo VI Foundation, former executive vice-chairman of MAPFRE international insurance group

      “… an effective wealth tax and a global minimum corporate tax … ”

      “With the COVID-19 pandemic, the gap between the rich and the poor, in particular the income gap, has increased as Pope Francis, among others, has stated on several occasions. It is undeniable that the trend had already started several decades ago. However, with COVID-19, inequalities have reached record levels that do necessitate strong internal reforms. If no actions will be taken, such as an effective wealth tax and a global minimum corporate tax, the possibility of social turmoil and unrest will be inevitable. In Italy, political parties are literally unable to agree and set the slightest kind of agenda for a proper patrimoniale (wealth tax or asset tax), preferring to keep the country in an extremely dangerous status quo.”

      Valerio Bruno —researcher in politics

      “… fiscal measures, transparency, control of cross-border capital movements … ”

      “Much attention has been given to the wealth as well as the income dimension of the inequalities — the associated rents of the minority at one end, and the much lower and often stagnating incomes of the remainder. The latter comprises not only the working class, but also parts of the middle class. Much commentary has also concerned the opportunities to hide wealth — and thus reduce tax exposure — provided by cross-border financial liberalization and offshore financial centers. Policy responses to the inequalities should include fiscal measures, including improved taxation of the wealth of individuals and firms, reforms of the transparency and other features of firm governance, broader acceptance of countries’ right to control cross-border capital movements, and changes in legal definitions designed to facilitate controls over firms’ domestic and cross-border access to different economic activities and industries and thus to restrict regulatory arbitrage and opaqueness in firms’ operations.”

      Andrew Cornford — counselor at Observatoire de la Finance, former staff member of the United Nations Conference on Trade and Development (UNCTAD), with special responsibility for financial regulation and international trade in financial services

      “… imaginative countermeasures of income … ”

      “The fundamental dynamic of any economy is summed up in the dictum, ‘To those who have shall be given and they shall have more than they can use, and from those who have not shall be taken even what they have.’ COVID also has set it in motion. Where the effects are beneficial — e.g., the reduction in travel by air — it should be encouraged. Further good news is that the deprivation inflicted by COVID on the deprived has been met — at least in places like Geneva — not by the usual blame, scorn and exclusion, but by imaginative countermeasures of income support and new forms of communication like Zoom.”

      Edouard Dommen — specialist in economic ethics, former university professor and researcher at the UNCTAD and president of Geneva’s Ecumenical Workshop in Theology.

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      “… first we have to think about youth … ”

      “The social deprivation problems are persistent, and this fact routinizes somehow their existence and hinders the definition of a social resilience threshold. Differentiated priorities emerged in South/Eastern Europe after the successive waves of crisis, but first we have to think about youth since no country can sustain without giving hope to its members through a micro/macro strategy that includes: i) an immediate recovery plan with emergency income support for the vulnerable groups; ii) long-lasting work-related policies and investments on youth employment (work-based training, tax reliefs for innovative enterprises); iii) strategies of sharing the risks with interregional cooperation and job retention schemes; and iv) protection and support of childhood integrity (tackling invisible work and poverty with financial benefits for low-income families and proper child/health-care, along with future-centered support, such as home learning environment and early schooling interventions).”

      Christos Tsironis —associate professor of social theory at the Aristotle University of Thessaloniki

      “… in Ukraine, social inequality will not become a priority soon … ”

      “In Ukraine, social inequality has two primary sources: the legacy of the ‘socialist’ totalitarian past and deformed oligarchic capitalism. At the same time, the initial period of transformation with the exacerbation of the problems of social inequality has dragged on dangerously. From 1991 to 2014, the domination of the interests of oligarchic groups over national interests acted as a brake on reforms. After the Revolution of Dignity, there was a political will to implement unpopular reforms, but they had to be carried out in conditions of the population’s fatigue from reforms, in the realities of Russian aggression. The promotion of reforms by servants of the people is complicated by populism. In Ukraine, social inequality will not become a priority soon. At this stage of transformation, this issue cannot be a priority; the authorities do not have a correct understanding of the hierarchy of priorities, and society’s perceptions of equality/inequality are distorted by collectivism and paternalism.

      Yuriy Temirov —associate professor, dean of the Faculty of History and International Relations at Vasyl Stus Donetsk National University

      *[An earlier version of this article was published by From Virus to Vitamin before the Ukraine War began.]

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      India’s Reasons For Abstaining in the UN on Russia’s Invasion of Ukraine

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      On February 26, the United Nations Security Council voted on a resolution proposed by the United States. Of the 15 members of the Security Council, 11 voted in favor and Russia unsurprisingly used its veto to kill the resolution. China, India and the United Arab Emirates abstained. Two days later, India abstained on a vote at the UN Human Rights Council in Geneva that set up an international commission of inquiry into Russia’s actions in Ukraine. The country also abstained at the UN General Assembly, which voted 141-5 to condemn the Russian invasion of Ukraine.

      India’s abstentions have led to much heartburn in the US and Europe. One high-flying national security lawyer in Washington argued that India was wrong to ignore Russia tearing down Article 2(4) of the Charter of the United Nations. Like many others, he took the view that India has sided with an aggressive autocrat, weakened its democratic credentials and proved to be a potentially unreliable partner of the West. The Economist has called India “abstemious to a fault.”

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      In particular, serving and retired American and British diplomats have been wringing their hands at India’s reticence to vote against Russia. For many Americans, this is a betrayal of the good faith that the US has reposed in India by giving the country a special nuclear deal in 2008 and designating India as a “major defense partner” in 2016. In 2018, the US elevated India to Strategic Trade Authorization tier 1 status, giving India license-free access to a wide range of military and dual-use technologies regulated by the Department of Commerce, a privilege the US accords to very few other countries. On Capitol Hill, India’s abstention is further viewed as an act of bad faith because many members of Congress and senators worked hard to waive sanctions against India. These were triggered by the Countering America’s Adversaries Through Sanctions Act when India bought Russian S-400 missile systems. 

      Many Western business leaders are now wondering if India is a safe place to do business after the latest turn of events. For some in the West, this is yet another example of India slipping inexorably down the slippery slope of authoritarianism under the ruling Bharatiya Janata Party (BJP) government of Prime Minister Narendra Modi.

      Two Unfriendly Nuclear Neighbors

      Such fears are overblown. India remains a thriving democracy. Elections just took place in five states after colorful political campaigns. Infrastructure development in India is going on at a record pace and growth remains high amidst inflationary pressures. Despite some blunders such as the 2016 demonetization of high-denomination currency notes and the botched 2017 rollout of the goods and services tax, the Modi-led BJP has become more market-friendly.

      As per the World Bank’s Doing Business 2020 report, India ranked 63 out of the surveyed 190 countries, a marked improvement from the 134 rank in 2014 when Modi came to power. Like the US, India is a fractious and, at times, exasperating democracy, but it is a fast-growing large economy. Even as US manufacturers Chevrolet and Ford exited the Indian market, Korean Kia and Chinese MG Motor India have achieved much success.

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      India is also proving to be a major force for stability in the region. After “America’s Afghanistan’s fiasco,” India has been picking up the pieces in an increasingly unstable region. The country is now providing humanitarian assistance to the Afghan people even as the US has abandoned them. Thousands of trucks roll out daily from India to Afghanistan via Pakistan as part of India’s effort to feed millions of starving Afghans. India is delivering 50,000 tons of wheat to a country led by the Taliban. Earlier, India sent 500,000 coronavirus vaccines as well as 13 tons of essential medicines and winter clothing to Afghanistan. Despite its reservations about the new regime in Kabul that offered refuge to hijackers of an Indian plane in 1999 and sent jihadists to Kashmir, a government branded as anti-Muslim by The New York Times is behaving magnanimously to help millions of Afghans facing starvation.

      Despite its thriving democracy and growing economy, India remains a highly vulnerable nation in an extremely rough neighborhood. To its west lies an increasingly more radical Pakistan that, in the words of the late Stephen Philip Cohen, uses “terror as an instrument of state policy in Kashmir.” To its east lies an increasingly aggressive China led by President Xi Jinping assiduously using salami-slicing tactics to claim more Indian territory. In sharp contrast to the US, India has two nuclear-armed neighbors and faces the specter of a two-front war given what Andrew Small has called the China–Pakistan axis.

      National security that occupies much headspace in Washington is a constant headache for New Delhi. Multiple insurgencies, street protests, mass movements, foreign interference and the specter of nuclear war are a daily worry. During the Cold War, Pakistan was an ally of the US and benefited greatly from American funding of the Afghan jihad against the Soviet Union. A 1998 report by Stockholm International Peace Research Institute (SIPRI) tells us India was among the top three recipients of Soviet/Russian weapons from 1982 to 1996. 

      More recently, India has diversified its arms imports. A 2021 SIPRI fact sheet makes clear that India is now the biggest importer of French and Israeli arms. From 2011-15 to 2016-20 Russian arms exports to India dropped by 53%, but the country still remained the top importer. In 2016-20, Russia, France and Israel’s share of India’s arms imports comprised 49%, 18% and 13% respectively. A retired assistant chief of the integrated staff estimates that around 70% of India’s military arsenal is of Russian origin.

      Given Indian dependence on Russian military hardware, it is only natural that New Delhi cannot afford to annoy Moscow. Critical Russian spares keep the defense forces combat-ready. For high-tech weaponry, which has the added advantage of coming at affordable prices, India relies on Russia. Moscow has also shared software and proprietary interaction elements for weapons delivery systems with New Delhi. Furthermore, Russia allows India to integrate locally-made weapons into its fighter jets or naval vessels unlike the US or even France. 

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      From New Delhi’s point of view, the India–Russia military-technical cooperation is even more valuable than Russian military kit. Unlike the West, Russia has been willing to transfer technology, enabling India to indigenize some of its defense production. This began in the 1960s when India moved closer to the Soviet Union even as Pakistan became a full-fledged US ally. Since then, Moscow has shared critical technologies over many decades with New Delhi. India’s supersonic anti-ship missile BrahMos that the Philippines recently bought is indigenized Russian technology as is India’s main battle tank.

      As a vulnerable nation in a rough neighborhood, India relies on Russia for security. Therefore, New Delhi decided it could not upset Moscow and abstained at all forums.

      The China Factor

      There is another tiny little matter worrying India. It is certain that Xi is observing and analyzing the Russian invasion of Ukraine. As a revisionist power, China seeks to overturn the postwar order. Beijing has designs on Taiwan and territorial disputes with many of its neighbors. Its most recent armed confrontation occurred with India though. Since that June 2020 clash, Indian and Chinese troops are locked in a stalemate that repeated rounds of talks have failed to resolve.

      More than anyone else, India fears a Russia–China axis. If Moscow threw in its lot with Beijing, India — deprived of technology and critical spares — might face a military catastrophe. If Russia sided with China in case of a conflict between the two Asian giants, India would face certain defeat.

      Recent military cooperation between Russia and China has worried India. A few months ago, a flotilla of 10 Russian and Chinese warships circumnavigated Japan’s main island of Honshu for the very first time. This joint exercise demonstrated that Russia and China now have a new strategic partnership. Despite their rivalry in Central Asia and potential disputes over a long border, the two could team up like Germany and Austria-Hungary before World War I. Such a scenario would threaten both Asia and Europe but would spell disaster for India. Therefore, New Delhi has been working hard to bolster its ties with Moscow.

      In December 2021, Russian President Vladimir Putin flew to India to meet Modi. During Putin’s trip, both countries signed a flurry of arms and trade deals. Apart from declarations about boosting trade and investment as well as purchasing various military equipment, Russia transferred the technology and agreed to manufacture more than 700,000 AK-203 rifles in India’s most populous state of Uttar Pradesh where the BJP has just been reelected. In the words of a seasoned Indian diplomat Ashok Sajjanhar, Putin’s visit “reinvigorated a time-tested strategic partnership between India and Russia.”

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      Sajjanhar left unsaid what astute Indian diplomats say in private. India’s close relationship with Russia is insurance against China. New Delhi wants Moscow to act as a moderating influence on Beijing and act as an honest broker between the two Asian giants. India believes that there is no power other than Russia that could act as its bridge to China.

      The Weight of History

      When Sajjanhar was speaking about a time-tested relationship, he meant decades of close India–Russia ties. During World War II and in the run-up to independence in 1947, the US earned much goodwill because Franklin D. Roosevelt championed the Atlantic Charter, promising independence to the colonies. However, relationships soured soon after independence because India chose socialism under its first prime minister, Jawaharlal Nehru.

      When the US conducted a coup against the democratically elected Iranian government of Mohammad Mosaddegh in 1953, India came to view the US as a neocolonial power. It is easy to forget now that Washington backed the interests of the Anglo-Iranian Oil Company over those of the government of Iran, triggering trepidation among Indian leaders who remembered clearly that their country was colonized by the British East India Company. The coup gave both capitalism and the US a bad name and pushed New Delhi closer to Moscow.

      In the following years, India’s ties with the Soviet Union strengthened. As Pakistan became a firm Cold War ally of the US, India embraced socialism ever more firmly and became a de facto Soviet ally, claims of non-alignment notwithstanding. In 1956, the Soviet tanks crushed the Hungarian Revolution. Nehru censured Moscow in private but refused to condemn Soviet action even as he railed against the Anglo-French intervention in the Suez. As per Swapna Kona Nayudu’s well-researched paper for the Wilson Center, New Delhi now became “a crucial partner in international politics for Moscow.”

      In 1968, the Soviets crushed the Prague Spring, an uprising in then-Czechoslovakia that aimed to reform the communist regime. Nehru’s daughter, Indira Gandhi, was prime minister, and she publicly called for the Soviets to withdraw their troops. In the UN Security Council, though, India abstained in the vote on the Czechoslovakia matter, attracting widespread condemnation from the American press.

      Three years later, India went to war with Pakistan to liberate Bangladesh. This did not go down well in the US, despite the fact that the military dictatorship of Pakistan was inflicting murder, torture and rape in a genocide of horrific proportions. During the 1971 India–Pakistan War, Richard Nixon called Gandhi a “bitch” and Henry Kissinger termed Indians as “bastards.” Indian diplomats repeatedly point out that Nixon and Kissinger ignored their own diplomats like Archer Blood who valiantly spoke truth to power about Pakistani atrocities, a story chronicled superbly by Princeton professor Gary J. Bass in “The Blood Telegram.” Instead, they sent vessels from the Seventh Fleet to intervene on Pakistan’s behalf. It was the Soviets who came to India’s rescue by sending their naval vessels to counter the American ones.

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      India repaid Moscow’s 1971 favor when Soviet troops invaded Afghanistan. In 1980, India refused to condemn this invasion at the UN. During the decade that followed, the US funded the mujahideen in Afghanistan through Pakistan. Relations between the US and Pakistan became closer than ever at a time when General Zia-ul-Haq launched Operation Tupac to “bleed India through a thousand cuts” by championing insurgencies within India. First Punjab and then Kashmir went up in flames. Terrorism became a feature of daily life for India, but the US turned a Nelson’s eye to the phenomenon until the grim attacks of September 11, 2001.

      Since those attacks, India and the United States have moved closer together. Thousands of Indian students study in the US every year, American investment has flowed into India and defense cooperation has steadily increased. The US views India as a valuable partner to contain the rise of an aggressive China, and New Delhi cares more about Washington than any other capital on the planet.

      Even as US–India ties have deepened, New Delhi has retained close ties with Moscow. Russia continues to build nuclear power plants in energy-hungry India. Plans to import more Russian oil and gas have also been in the works. Because of these ties, India did not condemn Russian action against Crimea in 2014. The left-leaning government in power at that time went on to say that Russia had “legitimate” interests in Ukraine.

      It is important to note that no opposition party has criticized the government’s position. Shashi Tharoor, a flamboyant MP of the Indian National Congress party who said that India was on “the wrong side of history,” got rapped on the knuckles by his bosses. The opposition and the government have almost identical views on the matter. Neither supports Russian aggression against Ukraine, but no party wants to criticize an old friend of the nation.

      Political Factors, Domestic and International

      War in Ukraine is obviously not in India’s interest. India imports energy, and rising oil prices are going to unleash inflation in an economy with high unemployment. This worries both political and business leaders. In its statement at the UN, India called for peace and diplomacy. In official statements, India has also expressed support for Ukraine’s sovereignty and territorial integrity. India does not in any way support Russian aggression but cannot criticize Moscow for a host of reasons described above as well as often overlooked political factors.

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      Indian leaders have also been preoccupied with elections in five critical states. Political analysts consider these elections to be a dress rehearsal for the 2024 national elections. With stakes so high, the ruling BJP was under pressure to bring home thousands of Indian students studying in Ukraine safely. For this, India relied on Russia. While some might say this necessitated a Faustian silence, 18,000 Indian lives were at stake.

      India also had reservations about Ukraine. Reports of Indian students facing racism in Ukraine have been doing the rounds on social media. These may be info ops by Russians, but they have touched a chord among the masses. Press reports of fleeing Indian students facing racism and segregation at the Ukrainian border have not helped, nor have memories of Ukrainian arms deals with Pakistan, which have triggered Indian suspicions. Even though India is against the conflict, New Delhi does not want to forsake an old friend and support a potentially hostile power.

      India also suspects the motives of the West in taking on Putin. There is a strong feeling across nearly all political parties that the US would not show the same concern for a non-white nation in Asia or Africa. Left-leaning parties point out that the US and the UK based their 2003 invasion of Iraq on a pack of lies. A popular Indian television anchor has railed against the “racist reportage” of Western media that treats blue-eyed, blonde Ukrainian refugees differently to Syrian or Afghan ones.

      There is also another matter driving India’s hesitation to go along completely with the US in targeting Russia. An increasing trust deficit between the Democrats and the BJP is harming US–India relations. For years, The New York Times and The Washington Post have relentlessly criticized the BJP, accusing the party of being authoritarian, if not fascist. Even food aid to the impoverished citizens in Taliban-led Afghanistan did not get any recognition from the papers of record in New York and Washington.

      Billionaires like George Soros who support Democrats have been vocal against the BJP and Modi. Their foundations have also funded Indian organizations opposed to the BJP. Americans see this funding as an expression of idealism that seeks to promote civil society and democracy. On the other hand, many Indians see American funding as a sinister ploy to weaken the nationalist BJP and replace them with weak, pliant leaders. Indians are also irked by the fact that Democrats rarely give credit to the BJP for winning elections, the democratic proof of its platform’s popularity.

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      Democrats have also been pressuring India to legalize gay marriage, forgetting that the issue is pending before the Indian Supreme Court. Indians point out that it was the British who decreed “unnatural” sexual acts” as not just illegal but also imprisonable during Queen Victoria’s heyday. The BJP has already come out in favor of legalizing homosexuality but has no power to intervene in a matter pending before the court. The failure of Democrats to recognize this reeks of a white savior complex that destroys trust between Washington and New Delhi. 

      Many BJP leaders are convinced that the Democrats are plotting some sort of a regime change in the 2024 elections. They believe there is an elaborate game plan in place to discredit Modi and the BJP. In this worldview, the Democrat establishment is manipulating discourse and peddling narratives that could lead to some version of the Orange Revolution in India. They are convinced that once Putin goes, Modi might be next. Even though India is opposed to a war that is severely hurting its economy, this fear of Western interference in domestic political matters is one more reason for India to abstain from turning on its old friend Russia.

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      Industrialization and Innovation Could Make the Indian Economy Takeoff

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      Labor-intensive manufacturing has historically been the best-known recipe for driving economy-wide productivity enhancement. Over time, several countries, notably those in East Asia, managed to move unskilled workers from farms in rural areas to factories in urban settings. This transition increased both individual incomes and national GDPs, ultimately boosting productivity.

      Not all countries have taken to manufacturing, though. Some of them have experienced premature deindustrialization, which economist Dani Rodrik has analyzed extensively. India’s manufacturing sector never reached full potential because of this phenomenon.

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      Instead, India ended up with the “premature servicization” of its economy. This diminished its capacity to create enough well-paying jobs for its large population and did not allow for increased productivity.

      India’s Drive to Industrialization and Innovation

      Services now comprise more than half of India’s GDP. As alluded to above, services do not deliver productivity growth in the same way as industry. Those who argue for free trade believe this does not matter. India can import industrial goods like cars and cellphones while exporting software writing and call center services.

      Such arguments for a trade-based economy fail to recognize, or in many cases deliberately omit, increasing trade deficits when a country has poor manufacturing. In a volatile and uncertain world, these deficits can become a geopolitical liability for any nation because manufacturers can shut off access to the most basic of goods. Manufacturing does not only increase productivity and enhance security, but it also creates jobs and lowers inequality. For these reasons, India has recently embarked on a reindustrialization program. 

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      The new Production Linked Incentives (PLIs) seek to attract the more reputed global manufacturers, the best brains in industry and high-quality, long-term investments to India. Under PLIs, participants can manufacture for the domestic and/or export markets. The government applied these incentives to 14 sectors, of which telecoms, cellphones, electronic equipment and automobiles are benefiting already.

      Many manufacturers station their Global Capability Centers (GCCs) in India, which has become a global base for services operations. A June 2021 report by Deloitte and NASSCOM states that 1,300 GCCs employed more than 1.3 million professionals and generated $33.8 billion in annual revenues in the financial year starting April 1, 2020, and ending March 31, 2021. Another report estimates that GCCs are likely to grow by 6-7% per year and rise to over 1,900 by 2025. It also says that these GCCs are evolving from back-office destinations to global hubs of innovation.

      Digitization is aiding this transformation of GCCs. Now, industrial design is no longer a monopoly of a headquarters in Michigan or Munich. Thanks to fast-speed internet and powerful computers, research, design and development of new machines, goods and consumption articles can take place anywhere in the world. Software is playing an increasingly bigger role in creating new hardware, driving additive manufacturing and automating factories. A process of disintermediation of manufacturing is under full swing, leading to what can be called a “servicization of manufacturing.”

      This trend gives India a unique opportunity. Global businesses need rapid, at-scale and cost-effective innovation. With its cost advantages and services ecosystem, India can provide that innovation to the world. Conventionally, innovation is associated with creating something new such as an iPhone or a Tesla. However, innovation occurs in less flamboyant ways as well. Any change in design or development that creates new value for the firm or provides an operational competitive advantage is an innovation too.

      A Unique Opportunity to Takeoff

      Global companies aiming to operate faster, cheaper and better are increasingly operating in India. The country has become more innovative over the years. India granted 28,391 patents in the financial year 2020-21, up from 9,847 in 2016-17 and 7,509 in 2010-11. Last year, the press reported that India registered as many trademarks in the past four years as in the previous 75. India’s rank on the global innovation index has moved up from 81 in 2015 to 46 in 2021. The World Intellectual Property Organization also recognized India as the second most innovative low and middle-income economy after Vietnam.

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      India missed out on the first and second industrial revolutions. The first one took place in Europe between the mid-18th and mid-19th centuries when India was fragmented and undergoing colonization by the British East India Company. The Second Industrial Revolution occurred in the 20th century, but India was ruled by the British government directly, which had no interest in industrialization. London’s incentive was to use India as a provider of raw materials and as a captive market for finished British industrial goods.

      After independence in 1947, India failed to industrialize unlike its East Asian counterparts. It chose a Soviet-style planned economy that was closed and protectionist. Only in 1991 when the Soviet Union collapsed did India embrace market reforms and liberalized its economy.

      Today, India is growing at 9% and its GDP is about to touch the $3-trillion mark. With strong global tailwinds, India can embrace industrialization and innovation, and finally enter what American economist Walt Rostow has termed the takeoff stage of economic growth.

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      Finding a Way to Diss Information

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      On March 11, at the United Nations, Russia accused the United States and Ukraine of collaborating on developing chemical and biological weapons. Russian officials claimed to have documents proving an attempt to destroy evidence of this illegal activity. None of the coverage reveals whether the documents published on the Russian Defense Ministry’s website make a credible case. In other words, the Russian accusations may or may not be true. Whether such activity is likely or not is another question, but even if it were considered likely, that does not make it true.

      The US and Ukraine have consistently and emphatically denied any even potentially offensive operations. The debate became complicated last week when at a Senate hearing, US Under Secretary of State Victoria Nuland admitted that the laboratories exist and were conducting research that might have dangerous consequences if it fell into Russian hands. She revealed nothing about the nature of the research. Various US officials explained that the research existed but aimed at preventing the use of such weapons rather than their development. That disclaimer may or may not be true.

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      At the United Nations meeting, the US ambassador to the UN, Linda Thomas-Greenfield categorically denied any activity with these words: “I will say this once: ‘Ukraine does not have a biological weapons program.’” As The Guardian reports, the ambassador then “went on to turn the accusation back on Moscow” when she accused Russia of maintaining a biological weapon program. That may or may not be true. In fact, both accusations have a strong likelihood of being true.

      ABC News summarized the issue in these terms: “Russia is doubling down on its false claims that the U.S. and Ukraine are developing chemical or biological weapons for use against invading Russian forces, bringing the accusation to the United Nations Security Council on Friday.”

      Today’s Weekly Devil’s Dictionary definition:

      False claims:

      Hypotheses that are likely enough to be true but difficult to prove conclusively

      Contextual Note

      The basic claim made by ABC News is true, at least if we reduce the message to the incontestable fact that the Russians brought the “accusation to the United Nations Security Council on Friday.” What may or may not be true is the reporter’s assertion that these are “false claims.” As noted above, the Russian claims may or may not be true, meaning they may or may not be false.

      Embed from Getty Images

      For news reporting in times of war, propaganda becomes the norm. It trumps any form of serious inquiry, that the legacy media in the US bases its reporting on two complementary suppositions: that everything US authorities tell them is true and that most everything Russians claim is false. Those same reporters who suppose their side is telling the truth and the other side is lying also suppose that their readers share the same suppositions. In times like these, propaganda is the most effective and especially the most marketable form of communication.

      The second sentence in the ABC News article adds a new dimension to the assertion. It complains that a “web of disinformation, not only from Russian state media but also Chinese propaganda outlets and even some American voices, have increasingly spread the conspiracy theory this week.” The metaphor of a spider’s web conveniently brings back the sinister logic of the McCarthy era, when certain Americans were accused of being witting or unwitting vectors of communist propaganda. And it inexorably links with the idea of spreading a “conspiracy theory.”

      It’s worth stopping for a moment to note that each sentence in the ABC News article is a paragraph. Single-sentence paragraphing is a journalistic technique designed to make reading easier and faster. Subtle writers and thinkers, such as Al Jazeera’s Marwan Bishara, can sometimes employ the technique to create a percussive effect. But in times of heightened propaganda, the popular media resorts to the practice to short-circuit any temptation on the reader’s part to think, reason, compare ideas or analyze the facts. In journalistic terms, it’s the equivalent of aerial bombing as opposed to house-to-house combat.

      The third sentence in the ABC News article delivers a new explosive payload, this time with appropriately added emotion (“heightened concern”) and a horrified hint at sophisticated strategy (“false flag”). It speaks of “heightened concern among U.S. and Ukrainian officials that Russia itself may be planning to deploy chemical or biological weapons against Ukrainian targets or as part of a so-called ‘false flag’ operation.”

      In just three sentences, the article has mobilized the standard web of associations journalists use for propaganda masquerading as news. The vocabulary may include any of the following terms: “disinformation,” “fake news,” “false flag,” “conspiracy theory,” “propaganda,” “misinformation,” and, on occasion, the more traditional pair, “deception and lies.”

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      The article’s fourth sentence is a quote from Ukrainian President Volodymyr Zelensky: “This makes me really worried because we’ve been repeatedly convinced if you want to know Russia‘s plans, look at what Russia accuses others of.” That is a trope the Biden administration has been using throughout this controversy. Zelensky has read the script and the journalist is there to transcribe it.

      Historical Note

      The still-developing history of COVID-19 that has been with us for nearly two and a half years should have taught us at least two things. Governments have a penchant for presenting a unique version of the truth that insists no other version is possible. They also excel at putting in place a system that suppresses any alternative account, especially if it appears to approach an inconvenient truth. Whether you prefer the wet market or the lab leak theory is still a matter of debate. Both narratives have life in them. In other words, either of them may or may not be true. For a year, thinking so was not permitted.

      The second thing we should have learned is that the kind of experimentation done in biological and chemical research labs will always have both a defensive and an offensive potential. From a scientific point of view, claiming that research is strictly limited to defensive applications makes no sense. Even if the instructions given to research teams explicitly focus on prevention, the work can at any moment be harnessed for offensive purposes. Victoria Nuland appeared to be saying just that when she expressed the fear that Russians (the bad guys) might seek to do something the Ukrainians and Americans (the good guys) would never allow themselves to do.

      Or would they? That is the point Glenn Greenwald made in citing the history of the weaponized anthrax that created a wave of panic in the days and weeks following the 9/11 attacks in 2001. George W. Bush’s White House, followed by the media, clearly promoted the idea that the “evidence” (a note with the message “Allah is Great”) pointed to the Middle East and specifically at Iraq’s Saddam Hussein. Even before 9/11, Bush’s White House had told the Pentagon to “accelerate planning for possible military action against Iraq.” In January 2002, the president officially launched the meme of “the axis of evil” that included Iraq, Iran and North Korea.

      In retrospect, even though no legacy news media will admit this, the most credible interpretation of the anthrax attacks that killed five Americans was as a failed false flag operation designed to “prove” that Iraq was already using biological weapons. As the White House was preparing for war in Afghanistan, it sought a motive to include Iraq in the operations. The plan failed when it became undeniable that the strain of anthrax had been created in a military lab in the US.

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      Years later, the FBI “successfully” pinned the crime on a scientist at Fort Detrick called Bruce Ivins, the Lee Harvey Oswald of the anthrax attacks. The FBI was successful not in trying Ivins but in pushing him to commit suicide, meaning there would be no review of the evidence or reflection on the motive for the attacks. This at least is the most likely explanation because it aligns a number of obvious and less obvious facts. Nevertheless, even this narrative accusing the Bush administration of engineering what was essentially a more lethal version of a Watergate-style crime may or may not be true. 

      The moral of all these stories is that in times of conflict, everything we hear or read should be reviewed with scrutiny and nothing taken at face value. And just as we have learned to live with unsolved — or rather artificially solved — assassinations of presidents, prominent politicians and civil rights leaders, we have to live with the fact that the authorities, with the complicity of an enterprising media skilled at guiding their audience’s perception, will never allow us to know the truth.

      *[In the age of Oscar Wilde and Mark Twain, another American wit, the journalist Ambrose Bierce, produced a series of satirical definitions of commonly used terms, throwing light on their hidden meanings in real discourse. Bierce eventually collected and published them as a book, The Devil’s Dictionary, in 1911. We have shamelessly appropriated his title in the interest of continuing his wholesome pedagogical effort to enlighten generations of readers of the news. Read more of The Fair Observer Devil’s Dictionary.]

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      American Hypocrisy and Half-Measures Damn Ukraine and Help Russia

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      Shortly after Russian forces invaded Ukraine, the government in Kyiv floated the idea of a no-fly zone to help protect civilians and soldiers. The West gave a swift and decisive refusal: threatening to shoot down Russian planes could set off World War III.

      And yet, three weeks into the war, the no-fly zone proposal just won’t die. Ukrainian President Volodymyr Zelensky begs for air support almost daily. In protests and social media posts, millions of ordinary people around the world ask NATO to #closethesky. 

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      Here in America, a nationwide poll showed that 74% of Americans support a no-fly zone. And earlier this month, 27 foreign policy experts published an open letter requesting a limited no-fly zone over humanitarian corridors. 

      If a no-fly zone is so obviously impractical, why are we still talking about it? The answer — which is conspicuously missing from mainstream Western discourse — lays bare the fundamental problem in the US response to the war. 

      A False Dichotomy

      Politicians and the media offer a single simplistic argument against protecting Ukraine’s airspace: Russia’s nuclear arsenal. Almost every official statement, article and op-ed can be summarized in one sentence: A no-fly zone would start World War III.

      Embed from Getty Images

      But here’s the part no one says out loud: What happens if the West doesn’t institute a no-fly zone? Will such a move keep us safe from nuclear Armageddon? Can the US manage to stay out of this war and out of Russia’s crosshairs? 

      Vladimir Putin’s rhetoric — and his actions — offer a clear answer. The US can avoid direct confrontation but at a price: handing the Russian leader an absolute, total victory. In Ukraine, of course, but also in Moldova and Georgia and perhaps the Baltics, and who knows where else? And, of course, carte blanche to commit whatever atrocities he’d like worldwide (à la Syria). 

      If Putin cannot win, he will lash out against enemies real and imagined. At that point, it won’t matter whether those enemies have instituted a no-fly zone. Putin has already likened sanctions and weapons deliveries to declarations of war on Russia, creating a ready excuse for retaliation. He’s set up a false narrative about Ukraine building a nuclear bomb, building a rationale to use his own nuclear weapons. 

      America’s Choice 

      The real question before the US government isn’t whether to institute a no-fly zone. It’s whether America is ready to help Ukraine win or prefers to stand by and watch the rise of a new Russian empire. 

      If not, we must stand up to Putin now. There are multiple viable policy options for doing so. One is arranging a no-fly zone administered by the United Nations rather than NATO. Another is sending Ukraine decommissioned Western fighter jets and several dozen volunteer air force vets who would be granted Ukrainian citizenship. Yet another would be to send only jets — Ukrainian fighter pilots have confirmed that they can, in fact, learn to fly Western jets in just a few days. 

      The specific mechanism matters less than the political will — the decision to send Putin a clear message that the US will not let him take Ukraine, backed up by sufficient military support. This option is not risk-free. But it’s impossible for Ukraine to prevail without angering Putin. 

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      Is the risk worth it? Ukrainians believe so because they see something most Americans haven’t yet figured out: World War III has already started. Putin’s grand ambitions are reminiscent of a certain German dictator 80 years before him, as is the US strategy of appeasement. In the end, US involvement is inevitable, so why not be strategic and proactive rather than reacting years later when the human and economic costs of Putin’s empire-building are too high to be ignored? 

      Of course, the US government may disagree with this perspective and opt for appeasement 2.0. Maybe this time around, the unstable dictator will be more reasonable?

      If this is the case, and the US government is not ready to stand up to Putin, it’s essential to make it clear that Zelensky is on his own. If we cannot make a commitment to let Ukrainians win, we should let them lose. Ukraine’s government deserves an honest understanding of what it can and can’t expect from the US so it can make decisions accordingly.  

      The Worst of Both Worlds

      So far, American politicians have spurned both of these options. Instead, they’re pursuing an immoral, dangerous fantasy, waiting for someone to stop Putin without America getting its hands dirty. To this end, they offer half-measures that drag out the conflict and cost thousands of lives. They wear blue and yellow, they send aid and enact sanctions, but they consciously steer clear of any support that could lead to a Ukrainian victory. 

      This brings us back to the absurd situation we started with: ongoing calls for an impossible no-fly zone, which we can now see are absolutely logical. Let’s review.

      America: Ukraine, we support you in your brave fight for freedom!

      Ukrainians and their friends abroad: Great! So, the one thing we need is support with our airspace.

      America: No can do. But believe us — we’re on your side here and we’re ready to help! 

      Ukrainians: Thank you. We’re dying here and we can’t win without air support. 

      America: Once again, no. But we stand with you.

      This hypocrisy goes well beyond the debate over the no-fly zone. For instance, on March 6, Secretary Blinken gave the green light for Poland to donate its fighter jets to Ukraine. When Poland agreed to cede the jets to the US for immediate transfer to the Ukrainian army, American officials backpedaled in a truly impressive display of doublespeak. 

      Embed from Getty Images

      Ukraine cannot win this war without the US taking tangible steps to protect Ukrainian airspace. Pretending otherwise and willfully extending the bloodshed with partial measures is the worst possible option for the United States. 

      The US government doesn’t owe Ukraine support. But it does owe Ukraine an immediate end to the falsehoods and the empty words — a bullshit ceasefire, if you will. An admission that, no matter how many civilian deaths, no matter what kind of banned weapons Russia uses or how many war crimes it commits, no matter if Russia drops a nuclear bomb on Kyiv, the US will not step in. 

      Until then, Russia pushes new boundaries every day with impunity, Ukraine holds out hope for help that will never come and Joe Biden wavers while children die. 

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      The War in Ukraine Threatens Global Food Security

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      Russia’s war against Ukraine directly impacts agricultural markets. First of all, the conflict impedes the delivery of existing stocks and the upcoming sowing of many types of grains. Due to the occupation and destruction of major ports, exports will continue to collapse. Agricultural exports from Russia are currently still possible on the main transport route via ports on the Black Sea. 

      However, shipping companies report limiting their transport due to the perceived danger and concerns about loss of business. Recently, Ukraine announced that it would restrict its own exports to secure domestic supply.

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      Ukraine and Russia have become key players for the export of both grain and sunflower (oil) in the post-Soviet era. For quite some time, their crop yields have influenced international volumes and prices, with Ukraine providing on average 10% of the world’s wheat export supply, and Russia as much as 24%; for maize, Ukraine supplied 15% of the staple feed and fodder. 

      The international market for fertilizer is even more concentrated. With trade shares of individual fertilizer components reaching up to 50%, Russia dominates the market for ammonium nitrate and Belarus, at 16%, for potash fertilizer.

      Wartime Uncertainty

      Due to general business uncertainty, the financial sanctions of numerous states and the EU against Russia currently affect agricultural exports indirectly while specific sanctions directly target respective exports. For example, last year, in response to the crackdown on the opposition in Belarus, the EU imposed sanctions on the market-dominating Belarusian potash producer Belaruskali, extending them last week.

      Prices for many agricultural products determined by the Food and Agriculture Organization of the United Nations currently already exceed the historic highs during the food price crises of 2007 and 2011. Fertilizer prices have also been rising to record levels for months. In addition, shortages due to reduced or canceled supplies of grain and fertilizer from Russia, Ukraine and Belarus are driving up prices. 

      Embed from Getty Images

      Since the beginning of the COVID-19 pandemic, Russia, like many countries, has been using export restrictions on agricultural products to secure its own supplies despite international warnings against these price-increasing measures. Just last week, the government recommended that Russian companies also limit fertilizer exports.

      Besides Ukraine, crop and supply shortfalls initially affect countries that import agricultural products from the war-affected region and are currently looking for readily available alternative sources. This drives up prices on global markets, thereby burdening all importers worldwide but hitting low-income countries and people the hardest. Egypt has an import share of 60% of Russian grain and 20% of Ukrainian grain. 

      To date, other countries that are already vulnerable to supply insecurity, such as Lebanon, Libya, Yemen, Bangladesh and Turkey, also purchase the majority of their grain from the region. Chad and Niger imported up to 80% of their fertilizer and raw materials from Russia and Belarus; Europe, as well as many countries in Latin America, also purchased large shares.

      Options for Adjustment 

      Affected countries have different options for adjustment. Egypt still has limited but probably sufficient grain stocks of its own for the time being, despite strong supply dependence vis-à-vis the region. In Lebanon, on the other hand, the 2020 explosion at the port of Beirut destroyed wheat warehouses, reducing storage capacity from six months to one month, necessitating a continuous flow of supplies.

      The remaining supply gaps that cannot be solved in importing countries by means of shifts in consumption toward more food rather than energy use require both food and fertilizer support. However, these are becoming more expensive as a result of rising prices for procurement and delivery. Transport and delivery must be additionally protected when sourcing from the region along vulnerable routes.

      Embed from Getty Images

      Trade must remain open and possibly protected on routes perceived as dangerous by shipping lines. Typical crisis-induced but price-pushing export restrictions must be avoided, both within the EU and internationally. Failing supplies from the major agricultural region will show their full effects in the coming autumn crop season, which may only be offset to a certain extent by crops from other major producers such as Australia, the US and the EU.

      Large agricultural countries could pursue forward-looking, coordinated market relaxation in order to quickly identify food supply potentials. However, in order to avoid symbolic politics or protectionist reflexes to support domestic production, the volume and price effects of possible approaches — suspension of set-aside programs, reduced use of agro-fuels or land rededication from fodder to food production — need to be assessed accurately. If a contribution to market relaxation is to be expected, corresponding measures should be quickly initiated for the upcoming crop year as a temporary crisis measure. 

      Similarly, the US is discussing the suspension of the conservation reserve program to allow farmers to bring set-aside areas into production. Price-driving sanctions with regard to fertilizers and agricultural goods should be avoided — or at least be accompanied by aid concepts to absorb linked supply risks.

      As during the onset of the COVID-19 crisis, the Agricultural Market Information System (AMIS) — a monitoring mechanism developed by the G20 in response to past food price crises — should be used for an international information campaign to prevent price-pushing export restrictions by means of appeals. However, more important than appeals would be the adoption of strict criteria and deadlines for these measures that are enforceable at the World Trade Organization level.

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      In the future, AMIS should cover not only agricultural products, fertilizers and energy sources but also the conditions of and access to trade infrastructure. Here, restrictions heavily influence supply and price and should be included in a comprehensive warning system for international supply potential.

      Furthermore, a future international political offensive for fertilizers and their raw materials is needed. Not only must the market situation be monitored and, in the event of shortages, be accompanied by aid early on. Technologies to make their use more efficient and to increase fertilizer production capacities as well as approaches to their substitution, whether technologically or by cultivation, are also needed.

      *[This article was originally published by the German Institute for International and Security Affairs (SWP), which advises the German government and Bundestag on all questions related to foreign and security policy.]

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      No, the Ban on Russian Athletes Should Not Be Lifted

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      In a recent article, Ellis Cashmore raised the provocative question of whether or not we should lift the ban on Russian sport instituted as a result of the invasion of Ukraine. Cashmore advances a number of sensible arguments, most importantly that this ban might turn out to be counterproductive. Instead of coaxing the Russian population to question the neo-imperialist delusions of its “great leader,” President Vladimir Putin, it might provoke an in-your-face backlash, reinforcing rather than weakening the despot’s grip on the minds of his subjects. 

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      Furthermore, Cashmore maintains, experience shows that sports bans largely failed to have a significant impact on regime policies in the past. South Africa is a case in point. There are good reasons to believe that the bans and boycotts the country was subjected to did little to hasten the collapse of apartheid. The same could, of course, be said about sanctions in general, as Peter Isackson has recently noted in these pages. Cuba is probably the most prominent example of the failure of prolonged sanctions to undermine a regime; Iran is another. 

      This could also be said about resolutions passed by the United Nations General Assembly condemning acts of aggression. The most recent vote following Russia’s attack on Ukraine has demonstrated once again the futility of symbolic gestures, even if supported by the vast majority of the international community. The reality is that for despots and autocrats, the only thing that counts is brute force. After all, what brought Nazi Germany to heel was not boycotts and sanctions but the overwhelming military might of the allies. 

      The Importance of Sport

      Should we, then, lift the ban on Russian sport? In fact, should we lift all sanctions imposed on Russia, given the fact that, empirically, sanctions more often than not turn out to be counterproductive? The answer to the second question is obvious, at least to me. Sanctions might not be particularly effective in their impact on regime behavior, but they serve as an expression of moral revulsion, a signal that we don’t want to have anything to do with you, or at least as little as possible. This involves all areas, not only economics — and particularly sport.

      Embed from Getty Images

      It is easy to state, as Cashmore does, that “it would be foolish to hyperbolize the importance of sport; obviously it is not as serious as war, or a million other things. So, why hurt people who are not responsible for the original sin?” Anyone who has ever watched Leni Riefenstahl’s 1938 film “Olympia,” which documented the 1936 Olympic Games in Berlin, is likely to get a sense of the importance of sport to autocratic regimes. 

      The Berlin Games were supposed to demonstrate the superiority of Adolf Hitler’s Aryan race. But a black athlete from the United States, Jesse Owens, had the audacity to steal the show, making HItler’s sport warriors — “swift as greyhounds, tough as leather, hard as Krupp steel” — literally eat dust. The Führer was not amused; he hastily left the stadium so not to have to bear witness to the Aryan humiliation.

      A famous German strategist once characterized diplomacy as war by other means. The same could be said about sport, particularly during the Cold War period. This was certainly true in the case of the SED regime in the former German Democratic Republic (GDR). For the regime, sport was more than a competition, it was a Systemfrage — a question of system, socialism vs. capitalism. Sport victories, particularly against West German athletes, meant confirmation of the superiority of the socialist system and, of course, of the Soacialist Unity Party. 

      At the same time, sport provided the regime with the international visibility it so desperately craved. For this, no price was high enough, including the health of the athletes. Starting in the early 1970s, the regime embarked on a broad-based systematic doping program. Already at a young age, promising athletes were pumped full of drugs, designed to enhance their performance and competitiveness. Many of them still suffer from the long-term consequences.

      Embed from Getty Images

      The East German case is extreme but hardly exceptional. Anyone who has ever visited Rome can attest to that. Rome hosts an Olympic stadium that dates back to the late 1920s, initially forming part of the larger Foro Mussolini. In the 1930s, the stadium was expanded, in preparation for the 1940 Olympics. The games were ultimately canceled because of the war, depriving Mussolini of the opportunity to showcase his Fascist revolution: the massive obelisk at the entrance of the Foro, with its “Mussolini Dux” inscription, the mosaics leading up to the stadium, glorifying the Fascist takeover, the granite blocs bearing excerpts of Mussolini’s speeches. 

      Mussolini’s reign ended in April 1945 at a gas station in Milan’s Piazzale Loreto. Yet at the centennial of Mussolini’s March on Rome, later on this year, the obelisk is still there, in Rome, in front of the Olympic stadium, together with the mosaics and the granite blocs — a silent testimony to a dictator’s hubris and the role of sport in it.

      Get Real

      One of the most often heard arguments these days on the subject of the sport ban is that it is the “innocent” athletes who are most directly affected by it. “I only feel sorry for the athletes” has been an often repeated mantra by those commenting on the ban. Let’s get real. Compared to the suffering and anxieties of millions of Ukrainian civilians subjected to Russian terror bombing, the chagrin of Russian athletes deprived of the opportunity to compete internationally is of little consequence — except, of course, for those, like Daniil Medvedev, who lose money. But then, the ATP has so far refused to follow other sports and ban Russian players. 

      Finally, one last thought. Before FIFA banned Russia from its World Cup competition, Poland, followed by Sweden and the Czech Republic, made it clear that they would not play Russia in the playoffs for the World Cup at the end of this year. Robert Lewandowski, Bayern München’s star forward and winner of the Best FIFA Men’s Player title two years in a row, was particularly adamant in his refusal to play against Russia. 

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      I am quite curious to know what would have happened had FIFA not banned Russia. Would Poland, Sweden and the Czech Republic have been sanctioned for refusing to play the Russian national team? What would have it done to FIFA’s already dismal image if, as a result, Vladimir Putin’s aggression against his neighbor had been compensated with Russia’s automatic World Cup qualification? 

      The reality is that international competitions in certain sports, such as football and ice hockey, are more than just sports. They are sources of national pride and national prestige, particularly for countries with autocratic regimes, with star athletes as national icons who are more often than not close to the regime. Alexander Ovechkin, arguably the best hockey player at the moment, has a long history of supporting Putin, including the 2014 annexation of Crimea. 

      As Czech hockey great Dominik Hasek has put it, this is not a personal matter: “Every athlete represents not only himself and his club, but also his country and its values and actions. That is a fact.” It is for this reason that the ban on Russian sport was imposed. It should not be lifted.

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      Try This Game to Evaluate Levels of Disinformation in Times of War

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      Although during her three-decade-long career as a US Foreign Service officer Victoria Nuland has done many things, mostly in the shadows, she has had two moments that projected her into the headlines, both related to crucial events in Ukraine. It is worth noting that on both of those occasions, her superiors expected her to remain in the shadows. In other words, it is merely by chance that she has now become a household name in US foreign policy.

      Nuland has loyally served every administration, Democrat and Republican, since Bill Clinton, with a single exception. Donald Trump most likely refused to exploit her acquired competence on the grounds that she had been tainted by working for Barack Obama’s State Department under Hillary Clinton and John Kerry. Or perhaps Trump felt she had become too embedded in the culture of the deep state he claimed to abhor.

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      Nuland’s closest direct collaboration with a luminary of American politics occurred between 2003 and 2005 when she held the position of principal deputy foreign policy advisor to Vice-President Dick Cheney. That enabled her to hone her skills as an aggressive agent of US power while playing an influential role in promoting the Iraq War. After that stint, she became George W. Bush’s ambassador to NATO. In January 2021, President-elect Joe Biden named her under secretary of state for political affairs, the fourth-ranking position in the State Department.

      According to Foreign Policy, who quotes Bill Clinton’s Deputy Secretary of State Strobe Talbott, Nuland “has a high degree of self confidence and an absolute dedication to working for the administration she is working for, whatever administration that is.” In other words, she is a reliable tool of anyone’s policy decisions, however generous, cynical or perverse they may be. That is what she proved when sent to Kyiv in February 2014 to pilot the operations around the peaceful protests that were then taking place that the State Department judged could then, with the appropriate level of management, be turned into a revolution.

      Embed from Getty Images

      The hacked recording of a phone call between the US ambassador to Ukraine, Geoffrey Pyatt, and Nuland sealed the otherwise discreet diplomat’s place in history. In the recording, Nuland’s voice can be heard giving Pyatt orders about who the United States had selected to be Ukraine’s new prime minister. Countering Pyatt’s suggestion of the popular former boxer, Vitali Klitschko, Nuland selected Arseniy Yatsenyuk. After the pro-Russian President Viktor Yanukovych fled the country and Yatsenyuk struggled to lead a new government, an anti-Russian billionaire, Petro Poroshenko, won the presidency in September 2014. He immediately appealed to the Obama administration for military assistance to counter Russia, but President Obama kept him at bay, reasoning that “Ukraine is a core interest for Moscow, in a way that it is not for the United States.”

      In other words, not only did the CIA work to overthrow the elected president, Yanukovych, but Nuland managed to manipulate Ukrainian politics from within and thus contribute to what was to evolve into a notoriously corrupt regime under Poroshenko. At the same time, her commander-in-chief, Barack Obama, chose to limit the US involvement in Ukraine by defining a prudent arm’s length relationship with the fiasco that was unfolding, even after Russia seized Crimea from the Ukrainians.

      Back in the News in 2022

      The events around the 2014 Maidan revolution provided the only occasion for the general public to become aware of Nuland’s name until last week when she appeared before the Senate where Florida Senator Marco Rubio questioned her about the current situation in Ukraine. That exchange should have been routine, but Rubio felt it was important to use Nuland’s testimony to refute accusations by Russia and China that the US was funding the development of chemical weapons in laboratories in Ukraine. 

      Nuland could have simply denied that any such laboratories existed and Rubio would have been satisfied. Instead, she uncomfortably explained not only that “biological research facilities” exist, but that the State Department is worried the Russians might effectively gain control of the labs, creating the risk of “research materials … falling into the hands of the Russian forces.” Some attentive observers deduced that the worry Nuland expressed concerned the possible revelation of illicit research funded and encouraged by the United States.

      The scandal that exploded after this exchange provoked two reactions. The first was a firm and over-the-top denial by the Biden administration. It was accompanied by a defensive counter-accusation claiming somewhat absurdly that the Russians were only making the accusation to cover up their own intention to use chemical weapons against Ukraine. The second more serious reaction was Rubio’s attempt to clarify the ambiguity of Nuland’s revelation by interrogating Director of National Intelligence Avril Haines and CIA Director William Burns.

      Rubio counted on Haines not to make the same mistake as Nuland. Clearly, he expected her to give just enough perspective to dismiss any suspicions that the US may be involved in illegal military research. Claiming that “the best way to combat disinformation is transparency,” to make sure Haines would understand the type of response he hoped to hear to dispel the negative effect of Nuland’s testimony, Rubio spent three full paragraphs framing his question and insisting “it’s really important … to understand what exactly is in these labs.” Haines offered this astonishing response: “I think medical facilities — that I’ve been in as a child, done research in high school and college — all have equipment or pathogens or other things that you have to have restrictions around because you want to make sure that they’re being treated and handled appropriately. And I think that’s the kind of thing that Victoria Nuland was describing and thinking about in the context of that.”

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      Haines tells Rubio not what she knows but what she “thinks,” a verb she uses three times in two sentences. What she describes is nothing more than a subjective memory from her personal past and a vague generalization about medical security. It contains zero information of any kind. The next part of her answer, concerning nuclear power plants, is not only irrelevant but also a vague generalization about the possibility of “damage … or theft.” Her answer clarifies nothing. But Rubio is satisfied and concludes with three words: “All right, thanks.”  

      In his subsequent questioning of CIA Director Burns, Rubio takes four paragraphs to frame his question, again intended to clarify Nuland’s testimony. In the last two paragraphs, however, he veers away from the question of Nuland’s revelation and instead asks Burns about Russian President Vladimir Putin’s strategy concerning negotiations. Burns jumps on the opportunity to avoid answering the initial question about the Ukrainian biolabs. From Rubio’s point of view, the case is closed.

      Growing Curiosity Outside the Circles of Power

      Whereas most news outlets were happy to repeat the Biden administration’s adamant denials that any kind of biochemical research was taking place in Ukraine, various commentators, including Glenn Greenwald, picked up the issue and raised further questions. Greenwald took the time to remind his public of the troubling precedent of the anthrax attacks following 9/11 in 2001. Only months after killing five people did Americans learn that the anthrax originated in the Fort Detrick military lab in Maryland and not in Saddam Hussein’s Iraq. (I have written elsewhere on Fair Observer about my own interrogations and investigation of that affair.)

      Nuland’s testimony was seriously embarrassing. Rubio’s follow-up failed to put the scandal to bed. It was time for the White House to go into full denial mode. Predictably, presidential Press Secretary Jan Psaki stepped up with the intent to kill all debate by peremptorily tweeting: “This is preposterous. It’s the kind of disinformation operation we’ve seen repeatedly from the Russians over the years in Ukraine and in other countries, which have been debunked, and an example of the types of false pretexts we have been warning the Russians would invent.”

      We may be justified in asking whether, in times of armed conflict, anything is more preposterous — and indeed more dangerous — than seeking to kill debate on a serious topic that might permit a better understanding of the context of the war. The refusal of debate would be especially preposterous concerning a war in which one’s own nation is theoretically not involved. (In reality, the Ukraine War is a showdown between the United States and Russia.) But now that fighting on the ground is real, preposterous discourse of any kind from either side becomes dangerous as the perspective of using weapons of mass destruction, either chemical or nuclear, has clearly become part of the equation. Since the Cuban missile crisis in 1962, the prospect of nuclear war has never been so evident.

      In this case, unfounded speculation about evil intentions cannot be considered an appropriate response. After all, the Russian contention expressed at the United Nations that the Ukrainian “regime is urgently concealing traces of a military biological program that Kiev implemented with support of the US Department of Defense” was at least partially confirmed by Nuland in her response to Rubio. It was met at the UN by a simple denial: “Ukraine does not have a biological weapons program. There are no Ukrainian biological weapons laboratories supported by the United States — not near Russia’s border or anywhere.”

      Unique Insights from 2,500+ Contributors in 90+ Countries

      The Russian accusation, citing purported facts, should require at least a consideration of those facts rather than a blanket denial or a counter-accusation. Nuland never walked back her statement. Haines mentioned only what she “thinks” and Burns was spared even answering the question.

      Psaki is nevertheless right to bring to the public’s attention the criterion of preposterousness. That is something worth focusing on in times of massive propaganda. Reading the news in all the legitimate press today, it should be clear that, as always, preposterousness becomes the dominant feature of public discourse in times of conflict. Psaki’s tweets themselves are wonderful examples of preposterous blathering.

      A Game for Spectators in Times of War

      It may be time to propose an instructive game for anyone interested in paring down the level of preposterousness in public discourse and even news reporting. Anyone can play the game, but it requires forgetting about the beliefs and reflexes our various authorities expect us to acquire.

      The game simply consists of ranking, on a scale of one to 10 in terms of the degree of apparent preposterousness, any official statement or authoritative-sounding opinion made about the conflict, whether pronounced by political authorities or the news media. In other words, it requires accepting as a default position that every simple assertion one sees or hears is as likely as not to be preposterous. 

      The first criterion is to weigh the amount of emotional force in the assertion in relation to informational content. If emotion is clearly present and dominant, three or more points should be added to the potential preposterousness score.

      The inclusion of some authentic context, real information, can, on the other hand, make the proposition potentially less preposterous, bringing the score proportionately back down. The score can be improved by the inclusion of serious context, including facts drawn from historical background, reducing the level of preposterousness. On the other hand, citing purported trends from the past, what are presented as reflexive patterns of behavior or supposed “playbooks” will add points, pushing the preposterousness level further upward. A simple denial or the categorizing an opposing comment as “disinformation” will add two or more points to the preposterousness.

      An important consideration is the identity of the source of the statement. If the author of the proposition is clearly associated with one or the other of the two opposing sides, five points will be added to the level of perceived preposterousness. Those points can only be reduced by the citation of facts. Neutral sources, unaffiliated with one side or the other, receive no preposterousness points but they may still say preposterous things. 

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      This neutral or non-neutral identity of the source can become complicated by other considerations, some of which may themselves prove preposterous. For example, anyone aware of the track record on controversial events of Glenn Greenwald, cited above, knows that he has no loyalty to either Vladimir Putin or Joe Biden. That fact can be easily proved. But because he is American and criticizes American leaders and pundits who demonize Russia, some preposterously believe he is favorable to Putin. This phenomenon of seeing nuance as opposition is a direct consequence of a longstanding trend in US culture that consists of believing that those who are not for us (i.e., those who do not automatically endorse all our actions) are against us.

      Another important rule of the game is that an identical counter-accusation, of the kind Psaki has made, should automatically add six points to the preposterousness index. In some cases, the counter-accusation may be true, so it cannot be assumed to be totally preposterous. If that can be established, some of the points can be canceled. The reason for adding so many points for an identical counter-accusation is simple. It is almost always an attempt not to clarify but to avoid addressing the evidence that exists. It goes beyond simple denial, which is worth only two or three points at best. A truthful counter-accusation should be accompanied by some form of concrete evidence other than vaguely reputational. If not, the six points should stand.

      Another rule is that citing sources for whom the suspicion of preposterously lying has become part of a standard mindset merits two supplementary points of preposterousness. This is a standard trick of lawyers in criminal cases who conduct research to impugn a witness who may have lied on another occasion. They want the jury to believe that lying on one occasion means lying on all occasions. Case dismissed.

      Two other significant factors of preposterousness that often go together are, first, the attempt to account for the psychology of the adversary by reducing to a particular (and generally ignoble) cause, and, secondly, predicting bad behavior to come. This last is often a clever gamble to the extent that the predictor may have some ability to provoke the predicted bad behavior. Depending on the odds, such predictions are worth two to four points. 

      Finally, repetition of stereotypes — often cited accusations or memes built up by past propaganda to provoke a predictable reflex in the public — may be worth from three to five points, depending on the status of the stereotype in the ambient culture.

      Those are the basic rules. Now, let’s look at a practical example to see how the game can be played. Jan Psaki provided another tweet that can serve that purpose: “Now that Russia has made these false claims, and China has seemingly endorsed this propaganda, we should all be on the lookout for Russia to possibly use chemical or biological weapons in Ukraine, or to create a false flag operation using them. It’s a clear pattern.”

      Psaki has accomplished a lot in this tweet to achieve a high score in preposterousness. “False claims” and “propaganda” are gratuitous assertions that need to be supported by evidence, which she has no intention of providing. This indicates the presence of a strong emotion of indignation. Citing China is an example of discrediting anything a witness has to say as being unreliable. The suggestion of being “on the lookout” appeals to the reflex of fear. The “false flag” accusation repeats a meme that has occurred so often in recent weeks that it deserves being compared to the boy crying wolf.

      And finally, Psaki uses the idea of a “pattern,” with the intention of making the public believe there is no reason to explore the facts, since the discourse is a simple repetition of predictable behavior. 

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      Psaki has a reputation for making preposterous statements sound reasonable, unlike, for example, Donald Trump’s former spokesperson, Kelly-Anne Conway, who excelled in sounding preposterous. In all fairness to Psaki, the state of war she is commenting on admits of so much ambiguity and uncertainty, even concerning basic facts, that the preposterousness level of her tweet should not be considered to have attained the maximum of 10;  seven or eight may be a more fitting appraisal.

      Other Applications of the Game

      Those interested in this game might try applying it to British Prime Minister Boris Johnson’s latest stab at being preposterous on the same issue in this clip from Sky News. In videos like this, body language and speech cadences can add a significant element to the score, two factors that became evident to observers in the Nuland hearing. 

      Of course, the same game can be played with Russia’s or any other country’s official discourse. War is not only an assault on people, infrastructure and property. It is always an assault on dialogue, curiosity and truth itself. Commenting on the “1984” communication atmosphere that we are now subjected to, Matt Taibbi notes that a “healthy person should be able to be horrified by what’s happening in Russia and also see a warning about the degradation that ensues from using “pre-emptive” force, or from trying to control discontent by erasing expressions of it.” Preposterous statements are just one way of disqualifying and erasing discontent. They may also seek to stir up the kinds of emotions that could trigger a nuclear war.

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More