Civil War in Libya | Global Conflict Tracker

Libya has struggled to rebuild state institutions since the ouster and subsequent death of former leader Muammar al-Qaddafi in October 2011. Libya’s transitional government ceded authority to the newly elected General National Congress (GNC) in July 2012, but the GNC faced numerous challenges over the next two years, including the September 2012 attack by Islamist militants on the U.S. consulate in Benghazi and the spread of the Islamic State and other armed groups throughout the country.

The United States, European allies, and the United Nations continued to express concern over the permanent fracture of Libya as armed militant groups have tried to divide the country along political and tribal lines. Moreover, in the absence of a primary governing body, migration and human trafficking have remained problematic.

Source: Civil War in Libya | Global Conflict Tracker

WeWork Acquires Spacious, Continues Consolidation Spree | Fortune

Look out, world—WeWork is showing no signs of slowing their plans for industry-wide domination.

“WeWork is still in growth mode—they need to hit those growth numbers post-IPO, and a couple acquisitions would help them do that,” says Matthew Kennedy, senior IPO market strategist at Renaissance Capital, a provider of institutional research and IPO ETFs.

“It’s clear that WeWork is trying to expand beyond its traditional office space model. Spacious attempts to utilize underutilized properties as office space, like restaurants, and [WeWork] has a demonstrated ability to create premium work stations, so it does seem like a logical fit.”

Source: WeWork Acquires Spacious, Continues Consolidation Spree | Fortune

Live coverage: House Judiciary to vote on impeachment after surprise delay | TheHill

The House Judiciary Committee is expected to vote Friday on two articles of impeachment against President Trump after delaying the vote late Thursday.

The decision to delay angered Republicans, who said Democrats had pulled a surprise on them with the last-second change.

Democrats said they did not think the votes should happen in the middle of the night.

Lawmakers had debated the articles all day and night before wrapping the panel’s work after 11 p.m.

The panel is now set to resume Friday at 10 a.m. A party-line vote on the two articles is expected.

Source: Live coverage: House Judiciary to vote on impeachment after surprise delay | TheHill

For Ukraine, War in Eastern Ukraine, Putin Are Problems That Require U.S. Support

It might have been tempting to think so with the summit this week in Paris between Ukrainian President Volodymyr Zelensky and Russian President Vladimir Putin. It was only a few months ago, after all, that Putin and Zelensky had their first phone call, which led to Russia and Ukraine swapping dozens of prisoners and agreeing to consider reopening talks over the political future of the breakaway Donbas region.

Yet despite some progress in Paris, a détente is still far off. Until Russia backs off its demand that Zelensky deal directly with the Russian-backed separatists in eastern Ukraine, the sustainability of any deal will be in doubt. Moreover, unless and until Russia makes room at the negotiating table for the United States, movement toward a negotiated settlement will be incremental at best.

By all accounts, the talks Monday mediated by French President Emmanuel Macron and German Chancellor Angela Merkel resulted in modest wins all around.

Source: For Ukraine, War in Eastern Ukraine, Putin Are Problems That Require U.S. Support

Is Alexa Always Listening? How Amazon, Google, Apple Hear, Record | Bloomberg

The recordings she and her co-workers were listening to were often intense, awkward, or intensely awkward. Lonely sounding people confessing intimate secrets and fears: a boy expressing a desire to rape; men hitting on Alexa like a crude version of Joaquin Phoenix in Her. And as the transcription program grew along with Alexa’s popularity, so did the private information revealed in the recordings.

Other contractors recall hearing kids share their home address and phone number, a man trying to order sex toys, a dinner party guest wondering aloud whether Amazon was snooping on them at that very instant.

“There’s no frickin’ way they knew they were being listened to,” Slatis says. “These people didn’t agree to this.” She quit in 2016.

In the five years since Slatis first felt her skin crawl, a quarter of Americans have bought “smart speaker” devices such as the Echo, Google Home, and Apple HomePod.

Source: Is Alexa Always Listening? How Amazon, Google, Apple Hear, Record – Bloomberg

Australia investing $715 million in northern port that hosts US Navy warships | Stripes

Upgrades worth $715 million to naval facilities in Australia’s Northern Territory will mean more support for visiting U.S. warships, according to an Australian defense expert.

The improvements are being made to an Australian naval base, HMAS Coonawarra, and the Larrakeyah Defence Precinct in Darwin, the Australian Department of Defence said in a Dec. 11 email.

Source: Australia investing $715 million in northern port that hosts US Navy warships – Stripes

The United States Needs a Competitive Approach to Countering China

The verdict is in on U.S. President Donald Trump’s trade war with China. Regardless of whether U.S. negotiators soon reach a deal with Beijing, the administration’s initial gambit has run aground.

After wreaking havoc on portions of the U.S. economy with his trade policies, the president is now angling to freeze or roll back tariffs on Chinese products in exchange for almost nothing.

Deal or no deal in the coming days, it is clear that the United States needs a fundamentally different approach to economic competition with China—one that bolsters U.S. technological and financial power while countering Beijing’s malign activities directly.

Tariff hikes haven’t forced Beijing to capitulate. Chinese negotiators are reportedly making only vague commitments to assuage U.S. concerns about currency manipulation and intellectual property theft.

Decoupling—particularly if unilateral and without requisite investments at home—is more likely to isolate the United States than China, engendering a world in which Beijing has control over leading technologies, data, and standards and sets global trade and investment rules in its favor. Fortunately, such an outcome is readily avoidable, but only if Washington focuses on outpacing China with a more competitive strategy.

Such a strategy should begin with ambitious U.S. investments in scientific, technological, and financial innovation, supercharging research and development (R&D) in critical areas where China has gained or is gaining a competitive edge. But it must go beyond that, sustaining ties with China where commercial exchange benefits the U.S. economy while at the same time developing more powerful safeguards to protect and advance vital U.S. technological advantages.

This should include, among other things, building a coalition of allies to design and create new rules and institutions for trade, technology, and investment that level the playing field and erode Beijing’s ability to profit from anticompetitive practices.

An effective strategy for competing with China should start with innovation at home. The United States should boost U.S. R&D spending, nurture and recruit talent, and provide public goods to support U.S. research. China is on track to surpass the United States in total R&D spending as early as 2019.

To sustain its technological advantage, the United States should increase federal R&D spending from 0.7 percent of GDP last year to 1.2 percent of GDP and strive to bring combined public and private spending to four percent of GDP by 2030.

But investing in innovation isn’t enough. China continues to prey on American openness and to exploit U.S. technology for malign purposes. The United States should therefore adopt more powerful measures to counter systematic intellectual property theft and forced technology transfer. The U.S. government has already stepped up screening of foreign investments and increased counterespionage investigations.

But the State Department, Federal Bureau of Investigation, and intelligence community should work together to develop enhanced visa-screening criteria to identify espionage risks. The FBI should also increase its collaboration with universities in order to combat academic espionage, while seeking wherever possible to preserve academic and research exchanges that enable “brain gain” for the United States.

To that end, the FBI should bring back the National Security Higher Education Advisory Board, which facilitated communication between universities and the national security community on counterintelligence threats, among other issues, until the FBI dissolved it in 2018.

The United States also needs stronger guardrails to prevent the transfer of U.S. technology to China for illicit or repressive purposes.

With these protections in place, U.S. companies could more securely engage with China on many dual-use emerging technologies. But stricter export controls are still necessary for certain critical technologies. To protect its competitive edge in artificial intelligence, Washington should coordinate with allies such as Japan and the Netherlands to prohibit the export to China of semiconductor manufacturing equipment and design tools.

At the same time, the United States should diversify and secure its own sources of key technology inputs, including those related to semiconductor manufacturing and rare earth minerals, to mitigate the risk of disruption to U.S. supply chains.

Similar competitive measures are needed in the world of finance, where China is increasingly challenging the United States as well. Alongside technological advantages, financial power is among the United States’ greatest sources of international influence.

It generates enormous U.S. wealth, provides the basis for sanctions authority, and allows the United States to set rules and norms on investment, state subsidies, market distortions, and trading practices. To sustain this power, the United States must ensure that its financial system remains a transparent, stable, and attractive market for the world to create and store wealth.

China does its best to exploit what opacity exists in the system and to further muddy the waters when doing so serves its interests. Congress should therefore legislate an end to anonymous corporations and shed light on shell games and illicit operations by requiring those who control companies to declare themselves.

Congress should also require foreign companies—including Chinese ones—that list securities on U.S. exchanges to comply with the same audit and disclosure requirements that apply to U.S. firms. This will help investors assess risk and support market stability.

At the same time, the United States should discourage the development of alternative, foreign payments or clearing mechanisms that seek to evade U.S. jurisdiction. China has launched its own payments facility and seeks opportunities to internationalize its currency—both fiat and virtual—to erode the dominance of the U.S. dollar.

The United States should work to beat out foreign cross-border payment mechanisms by promoting U.S.-based or U.S.-linked alternatives that improve efficiency, lower costs, offer privacy, and have full digital functionality.

The United States should also encourage European payment mechanisms for humanitarian trade with Iran or other sanctioned countries so long as they do not violate U.S. sanctions. This will diminish growing sanctions-busting sentiment abroad.

With China making aggressive investments in financial technology, the U.S. administration should support a regulatory posture that provides more active support, flexibility, and guidance to U.S. developers. Through such an approach, regulators can help U.S. firms better compete against foreign firms, including Chinese ones.

In particular, the United States should look to support financial technology development for domestic and cross-border insurance, lending, payments, settlement, clearing, and tokenized assets applications, all of which will help make the U.S. financial sector more competitive, efficient, and reliable.

Leading the field in these areas will also help U.S. firms beat out the competition to capture billions of new financial sector entrants across Asia, Africa, and Latin America.

Additionally, the United States should pursue new multilateral agreements with Asia-Pacific and European nations that set high standards for trade and investment. These agreements will grow the U.S. economy while also helping U.S. partners reduce their economic dependence on China. They will also expand the portion of the global economy committed to free and fair trade rules on labor, the environment, currency, and intellectual property.

China is a formidable challenger, but the United States can still compete favorably against it. Doing so will require a fundamental rethink of U.S. strategy.

Source: The United States Needs a Competitive Approach to Countering China

What Elizabeth Warren, Bernie Sanders, AOC, and Neosocialists Get Wrong About Capitalism

We are living, so we are told, in a neosocialist moment. From politicians such as the Briton Jeremy Corbyn and the Americans Alexandria Ocasio-Cortez and Bernie Sanders leading the charge, to celebrated academics inveighing against the sins of capitalism, to the hipster chic of the Jacobin crowd, a growing movement on the far left is trying to revive and rehabilitate a long-dormant ideological tradition.

The movement’s obsession is the pursuit of greater equality, expressed primarily through punitive leveling. Things that contribute to inequality, such as income or profit or wealth, are considered public harms that need to be controlled—by taxes, regulation, and other government policies. The consequences for other priorities, such as sustainable revenue, economic growth, technological innovation, and individual freedoms? Not part of the equation.

Capitalism has strengths and weaknesses, and critiques of it are familiar—they’ve circulated widely ever since market-based economic systems started gaining ground in the eighteenth century.

The neosocialist movement is something different, however. Its roots lie not in social democracy but in democratic socialism, which seeks less to reform capitalism than to end it. And if its policies were ever put into practice, they would lead to disaster.

The neosocialists are descended from Rousseau. They downplay poverty and fetishize equality, focus on wealth distribution rather than wealth creation, and seem to care as much about lowering those at the top as raising those at the bottom.

The movement’s signature policy proposal is a wealth tax, an annual levy on household assets. Touted by economists such as Thomas Piketty, Emmanuel Saez, and Gabriel Zucman, all associated with the Paris School of Economics, the concept has been embraced by both Sanders and Elizabeth Warren, U.S. senators from Vermont and Massachusetts, respectively, who are running for the Democratic presidential nomination.

The radicalism of this approach is often underestimated. Many people conflate wealth taxes with higher income taxes or see them as mere extensions of a similar concept. But wealth taxes are fundamentally different instruments with much broader ramifications for economic dynamism and individual liberty.

The main effect of a wealth tax would be to discourage wealthy individuals from holding demonstrable assets. Any individual or household within shouting distance of the threshold would have to get its assets valued annually, imposing costs and creating a permanent jobs program for tax lawyers and accountants, whose chief responsibility would be to figure out ways around the law, including moving assets abroad.

The war against climate change, that is, will ultimately be fought and won in large part by an army of Schumpeterian entrepreneurs large and small, deploying their mage-like powers for humanity’s collective defense. Unless the neosocialists have their way, and turn off the engines of innovation just when they are needed the most.

Source: What Elizabeth Warren, Bernie Sanders, AOC, and Neosocialists Get Wrong About Capitalism

How America and China Are Competing Over the Future of Capitalism

Capitalism rules the world. With only the most minor exceptions, the entire globe now organizes economic production the same way: labor is voluntary, capital is mostly in private hands, and production is coordinated in a decentralized way and motivated by profit.

There is no historical precedent for this triumph.

Even as recently as 100 years ago, when the first form of globalized capitalism appeared with the advent of large-scale industrial production and global trade, many of these other modes of production still existed. Then, following the Russian Revolution in 1917, capitalism shared the world with communism, which reigned in countries that together contained about one-third of the human population. Now, however, capitalism is the sole remaining mode of production.

In the states of western Europe and North America and a number of other countries, such as India, Indonesia, and Japan, a liberal meritocratic form of capitalism dominates: a system that concentrates the vast majority of production in the private sector, ostensibly allows talent to rise, and tries to guarantee opportunity for all through measures such as free schooling and inheritance taxes.

Alongside that system stands the state-led, political model of capitalism, which is exemplified by China but also surfaces in other parts of Asia (Myanmar, Singapore, Vietnam), in Europe (Azerbaijan, Russia), and in Africa (Algeria, Ethiopia, Rwanda). This system privileges high economic growth and limits individual political and civic rights.

These two types of capitalism—with the United States and China, respectively, as their leading examples—invariably compete with each other because they are so intertwined.

Capitalism now has no rival, but these two models offer significantly different ways of structuring political and economic power in a society. Political capitalism gives greater autonomy to political elites while promising high growth rates to ordinary people. China’s economic success undermines the West’s claim that there is a necessary link between capitalism and liberal democracy.

Liberal capitalism has many well-known advantages, the most important being democracy and the rule of law. These two features are virtues in themselves, and both can be credited with encouraging faster economic development by promoting innovation and social mobility. Yet this system faces an enormous challenge: the emergence of a self-perpetuating upper class coupled with growing inequality. This now represents the gravest threat to liberal capitalism’s long-term viability.

At the same time, China’s government and those of other political capitalist states need to constantly generate economic growth to legitimize their rule, a compulsion that might become harder and harder to fulfill. Political capitalist states must also try to limit corruption, which is inherent to the system, and its complement, galloping inequality. The test of their model will be its ability to restrain a growing capitalist class that often chafes against the overweening power of the state bureaucracy.

While the current system has produced a more diverse elite (in terms of both gender and race), the setup of liberal capitalism has the consequence of at once deepening inequality and screening that inequality behind the veil of merit. More plausibly than their predecessors in the Gilded Age, the wealthiest today can claim that their standing derives from the virtue of their work, obscuring the advantages they have gained from a system and from social trends that make economic mobility harder and harder.

The last 40 years have seen the growth of a semipermanent upper class that is increasingly isolated from the rest of society. In the United States, the top ten percent of wealth holders own more than 90 percent of the financial assets.

The formation of a durable upper class is impossible unless that class exerts political control.

The system of political capitalism has three defining features. First, the state is run by a technocratic bureaucracy, which owes its legitimacy to economic growth. Second, although the state has laws, these are applied arbitrarily, much to the benefit of elites, who can decline to apply the law when it is inconvenient or apply it with full force to punish opponents. The arbitrariness of the rule of law in these societies feeds into political capitalism’s third defining feature: the necessary autonomy of the state.

In order for the state to act decisively, it needs to be free from legal constraints. The tension between the first and second principles—between technocratic bureaucracy and the loose application of the law—produces corruption, which is an integral part of the way the political capitalist system is set up, not an anomaly.

Hierarchy produces greater efficiency and higher wages.

“Technique is the boundary of democracy,” the French philosopher Jacques Ellul wrote more than half a century ago. “What technique wins, democracy loses. If we had engineers who were popular with the workers, they would be ignorant of machinery.” The same analogy can be extended to society as a whole: democratic rights can be, and have been, given up willingly for higher incomes.

The key question is whether China’s capitalists will come to control the state and if, in order to do so, they will use representative democracy.

What does the future hold for Western capitalist societies? The answer hinges on whether liberal meritocratic capitalism will be able to move toward a more advanced stage, what might be called “people’s capitalism,” in which income from both factors of production, capital and labor, would be more equally distributed.

This would require broadening meaningful capital ownership way beyond the current top ten percent of the population and making access to the top schools and the best-paying jobs independent of one’s family background.

Source: How America and China Are Competing Over the Future of Capitalism

Norway’s Telenor picks Ericsson for 5G, abandoning Huawei | Reuters

Telenor has picked Sweden’s Ericsson as the key technology provider for its fifth-generation (5G) telecoms network in Norway, it said on Friday, gradually removing China’s Huawei [HWT.UL] after a decade of collaboration over 4G.

Fearing high-tech espionage, and battling with China over trade, the United States has pushed NATO allies such as Norway to exclude Huawei from lucrative 5G deals, and Norwegian security services also warned against the firm.

Source: Norway’s Telenor picks Ericsson for 5G, abandoning Huawei – Reuters