Sunday, June 4, 2023
Wildfires spread in eastern Canada, forcing evacuations in coastal Quebec (Reuters) Some 10,000 residents in coastal Quebec were forced to evacuate homes on Friday as wildfires engulf more Canadian provinces, in what is emerging as one of the worst starts to the forest fire season. The mayor of Sept-Iles, a coastal Quebec city, declared a local state of emergency on Friday, as wildfire risk led to evacuation orders in the region. Some 30,000 people across Canada are displaced due to forest fires that are burning in nearly all of Canadian provinces. More than 2.7 million hectares have been scorched so far this year across the country, equal to more than five million football fields, federal Emergency Preparedness Minister Bill Blair has said. That's more than 10 times the average area typically burned by this time of year over the past decade.
Dollar backlash (Bloomberg) All around the world, a backlash is brewing against the hegemony of the US dollar. Brazil and China recently struck a deal to settle trade in their local currencies, seeking to bypass the greenback. India and Malaysia signed an accord to ramp up usage of the rupee in cross-border business. Even US ally France is starting to complete transactions in yuan. Currency experts are leery of sounding like the Cassandras who have wrongly predicted the dollar’s imminent demise on any number of occasions over the past century. And yet, in observing this sudden wave of agreements aimed at sidestepping the dollar, they detect the sort of gradual, meaningful action that was typically missing in the past. For many global leaders, their rationales for taking these measures are strikingly similar. The greenback, they say, is being weaponized, used to push America’s foreign-policy priorities—and punish those that oppose them. “Countries have chafed for decades under US dollar dominance,” said Jonathan Wood, principal for global issues at consultancy Control Risks. “More aggressive and expansive use of US sanctions in recent years reinforces this discomfort—and coincides with demands by major emerging markets for a new distribution of global power.”
The Debt-Limit Deal Suggests Debt Will Keep Growing, Fast (NYT) The bipartisan deal to avert a government default this week featured modest cuts to a relatively small corner of the federal budget. As a curb on the growth of the nation’s $31.4 trillion debt load, it was a minor breakthrough, at best. It also showed how difficult—perhaps impossible—it could be for lawmakers to agree anytime soon on a major breakthrough to demonstrably reduce the nation’s debt load. The fundamental drivers of American politics all point toward the United States borrowing more, not less. The agreement provides clear evidence that the nation’s overall debt load will not be shrinking anytime soon. Republicans cited that mounting debt burden as a reason to refuse to raise the limit, risking default and financial crisis, unless Mr. Biden agreed to measures to reduce future deficits. But negotiators from the White House and House Republican leadership could only agree to find major savings from nondefense discretionary spending. That’s the part of the budget that funds Pell grants, federal law enforcement and a wide range of domestic programs. Base discretionary spending accounts for less than one-eighth of the $6.3 trillion the government spends annually. The deal included no major cuts to military spending, which is larger than base nondefense discretionary spending. Early in the talks, both parties ruled out changes to the two largest drivers of federal spending growth over the next decade: Social Security and Medicare. The cost of those programs is expected to soar.
As legal gambling surges, should schools teach teens about risk? (AP) As a high school senior, Nick was blessed with a deadly accurate jump shot from the three-point range—something he was quick to monetize. He and his gym classmates not far from the Jersey Shore would compete to see who could make the most baskets, at $5 or $10 a pop. Before long, he was gambling staggering sums of money on sports, costing him over $700,000 in the past decade. He hit rock bottom last year when he stole $35,000 from his workplace and gambled it away on international tennis and soccer matches—sports he admittedly knew nothing about. Wagering is now easier than ever for adults—and children—and there’s a growing movement in the U.S. to offer problem gambling education courses in public schools to teach teenagers how easily and quickly things can go wrong with betting. It’s a trend that 27-year-old Nick wishes had existed when his gambling habit took root in high school and led him on a path to financial ruin.
Religious leaders, once mostly spared Haiti’s violence, are now targets (Washington Post) As gangs maraud through Haiti’s cities mostly unchecked, they are now targeting groups that had once been spared such violence—a sign of how the new level of lawlessness here is shattering long-standing taboos. “What we are observing today in terms of attacks on religious is unprecedented,” said Laënnec Hurbon, a Haitian sociologist who studies religion in the Caribbean. “There’s a desacralization of almost everything in Haiti. Everything that could bind the society … is nonexistent.” The violence has shuttered peristyles, churches and mosques, making it difficult for people to worship freely. The victims span different faith groups: an Italian missionary nun who cared for poor children was killed last year. So was a Vodou priest. Seventeen American and Canadian missionaries were kidnapped in October 2021. A Catholic priest was taken hostage in February. Several dozen worshipers were attacked last month after a Vodou ceremony near Canaan, a shantytown controlled by gangs. Haiti’s religious sector is now “directly” targeted in the security crisis, according to the Port-au-Prince-based Center for Analysis and Research in Human Rights.
Argentines grill more steak despite pressures of 109% inflation (Reuters) Argentines are expected to eat the most beef in five years in 2023, extending the country’s reign as the No. 1 steak consumer per capita despite the painful impact of 109% inflation on food prices, a Rosario grains exchange report showed on Friday. The major beef producer, where “asado” barbecues are a key part of the culinary culture and steakhouses dot city streets, has seen in recent years beef consumption dip as prices climbed and diners shifted to cheaper chicken and pork. That, however, seems to be partly reversing, even in the face of one of the world’s highest inflation rates which has badly hurt spending power. Analysts expect inflation could hit 130% by the end of the year. “Despite everything, the traditional asado remains one of the pillars of the local gastronomic tradition, and a must at most Argentine dinner tables,” the exchange said, adding likely beef consumption this year would be 53.1 kilograms per person.
Use of NATO arms for attack in Russia raises doubts about Kyiv’s controls (Washington Post) The Russian fighters aligned against Moscow who launched a cross-border raid from Ukraine into the Belgorod region of Russia last week used at least four tactical vehicles originally given to Ukraine by the United States and Poland, U.S. officials said, raising questions about the unintended use of NATO-provided equipment and Kyiv’s commitments to secure materiel supplied by its supporters. Three of the Mine-Resistant Ambush Protected vehicles, also known as MRAPs, taken into Russia by the fighters were provided by the United States and the fourth was from Poland, according to people familiar with the U.S. intelligence finding, which has not previously been reported. The fighters also carried rifles made by Belgium and the Czech Republic and at least one AT-4 antitank weapon in common use among U.S. and Western troops, according to photos verified by The Washington Post. U.S. and Western officials have insisted that Ukraine carefully track the billions of dollars’ worth of weapons that have flowed into the country. Kyiv’s backers have also largely barred Ukrainian forces from using Western weapons and equipment for attacks on Russian soil. Yet the recent raid into Russia underscores how materiel can change hands in unpredictable ways. At least two MRAPs appear to have been captured by Russian forces after the operation.
As China Risks Grow, Manufacturers Seek Plan B—and C and D (WSJ) For much of the past decade, Western companies have sought an alternative to China to manufacture goods—a shift executives call “China plus one.” Increasingly, the strategy looks more like China plus many. Part of the reason is that no single country can accommodate all the production leaving China. Vietnam is business-friendly, but it doesn’t have enough skilled workers. India has a large labor force, but infrastructure is patchy. Mexico is near the U.S. market, but a long way from China’s component suppliers. The diversification, which some experts call multishoring, also reflects a stark new reality: The world is a far more complicated place to do business than it was a decade ago.
China’s quandary: Bail out debt-laden cities, or risk disruptive defaults? (Washington Post) Across China local governments, whose balance sheets have long been precarious, are struggling to service debts estimated to total as much as $23 trillion. Not only do cities have to make up for nearly three years of paying for costly “zero covid” measures, they also have to contend with a property downturn, slow land sales—a primary source of their income—and a weaker-than-expected economic recovery, which means lower tax revenue. Now they’re having trouble repaying those debts, local governments are floundering around for cash. And that’s being felt on the ground. Teachers say they’re not getting paid. Motorists say they’re paying more for parking. More and more cities are even auctioning off public services like school lunches, shared bicycles and operating rights for vendor stalls and sightseeing carts. As the situation escalates, so too are calls for the central government to step in to defuse the situation. But policymakers in Beijing face a dilemma, analysts say. If they step in too early or with too much support, they risk undermining attempts to improve fiscal responsibility. But doing too little or waiting too long could result in defaults with widespread implications for the already slowing Chinese economy.
Heavy rains continue to hit Japan, suspending some trains (Reuters) Heavy rains caused by Tropical Storm Mawar and a seasonal rain front continued on Saturday morning in a wide swath of the Japan, prompting authorities to issue warnings of damage and stranding many people as train services were suspended. Although Mawar has weakened from super typhoon status, the Japan Meteorological Agency (JMA) urged people to be on high alert for landslides, rising rivers and flooding in eastern Japan, while warning of landslides in western Japan.
UN agency for Palestinian refugees raises just $107 million of $300 million needed to help millions (AP) Despite a dire warning from the U.N. chief that the U.N. agency for Palestinian refugees “is on the verge of financial collapse,” donors at a pledging conference on Friday provided just $107 million in new funds—significantly less than the $300 million it needs to keep helping millions of people. Philippe Lazzarini, commissioner general of the agency known as UNRWA, said he was grateful for the new pledges but they are below the funds needed to keep over 700 schools and 140 clinics open from September through December. UNRWA was founded in the wake of the creation of the state of Israel in 1948 to provide hundreds of thousands of Palestinians who fled or were forced from their homes with education, health care, social services and in some cases jobs. Today, their numbers—with descendants—have grown to some 5.9 million people, most in the Gaza Strip and West Bank, as well as neighboring countries in the Middle East. UNRWA has faced a financial crisis for 10 years, but Lazzarini said the current crisis is “massive,” calling it “our main existential threat.”
