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Opinion | The Red Wave Didn't Just Vanish - The New York Times - 0 views

  • On Election Day, a small but crucial percentage of Republican voters deserted their party, casting ballots for Democratic nominees in several elections that featured Trump-backed candidates at the top of the ticket. These Trump-driven defections wrought havoc on Republican ranks.
  • at key battleground states that were critical to continued Democratic control of the Senate. In Arizona, Nevada, Pennsylvania and New Hampshire, party-line voting among Republicans consistently fell below the party’s national average, according to exit poll data.
  • In New Hampshire and Pennsylvania, the Republican vote for the Republican Senate candidate was seven percentage points below the national average, and the Republican vote for the Democratic Senate candidate increased by the same amount; in Arizona, support for the Republican Senate nominee fell among Republicans by six points, and support for the Democratic candidate rose by the same amount again; in Nevada, the drop in support for the Republican candidate was two percentage points, and the increase for the Democratic nominee was once again the same.
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  • the major finding of the survey “is that democratic norm violations of the sort many Republicans ran on are an electoral loser.”
  • Republican candidates, Westwood added, “running on platforms that supported democratic norm violations were standing behind a policy that seems to only resonate with Trump and a small minority of Republican voters.
  • A publicly released post-election analysis by Neil Newhouse and Jim Hobart, partners at the Republican polling firm Public Opinion Strategies, found, for example, that a far higher percentage of Democrats, 81 percent, believe “Republicans represent a threat to democracy that, if not stopped, will destroy America as we know it,” than Republicans (69 percent) believe the same thing about Democrats
  • the election outcomes are consistent with the interpretation that the candidates most closely associated with Trump suffered a penalty. Voters rejected all the Trump-endorsed secretary of state nominees in important swing states. Republicans unexpectedly lost seats in districts where Republican incumbents who supported Trump’s impeachment had been denied renomination. Republicans closely linked to Trump lost elections in winnable swing states
  • Both Democrats and Republicans, Westwood said,overestimate the extent to which the other side supports democratic norm violations by up to five times. There is a real risk that damage to our country could occur not because of support for norm violations but as a pre-emptive strike based on the faulty assumption that the other side has abandoned democracy.
  • abortion, which worked to the advantage of Democrats, “was more of a factor than the pre-election polls indicated,” with almost as many voters, 31 percent, saying it was a high-priority issue as the 32 percent who identified rising prices and inflation, an issue that benefited Republicans
  • Almost identical percentages identified concern over democratic backsliding, at 25 percent, a pro-Democratic issue, as the 26 percent who identified jobs and the economy, a pro-Republican concern.
  • through 2020, a larger percentage of Republicans considered themselves “to be more a supporter of Donald Trump” than “a supporter of the Republican Party.” That came to an end in January 2021, and by this month, 67 percent said they were “more a supporter of the Republican Party,” more than double the 30 percent who said they were “more a supporter of Donald Trump.”
  • Crime, Greenberg wrote,was a top issue for many Democratic base voters. A quarter of Blacks and half of Hispanics and Asians voters trusted Republicans more than Democrats to address the issue. With Democrats trailing Republicans by 10 points on crime, Democrats have a lot of work to do.There is another word of caution for Democrats. The party’s single most important achievement in 2022 was to maintain control of the Senate, preventing Republicans from blocking Biden’s judicial and executive branch appointments.
  • n 2024, however, 23 seats in the Democratic caucus will be up for grabs — including two independent seats (Angus King in Maine and Bernie Sanders in Vermont) — making it that much harder for Democrats to keep their thin majority. Eight of these Democratic seats are in purple or red states (Montana and West Virginia, for example), offering multiple opportunities to the Republican Party
  • In contrast, all 10 of the Republican-held seats up for election in 2024 are in solidly red states.
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Health Experts Warily Eye XBB.1.5, the Latest Omicron Subvariant - The New York Times - 0 views

  • Most recombinant SARS-CoV-2 viruses have dwindled away in a matter of weeks or months, unable to outcompete other lineages. XBB, on the other hand, got a winning ticket in the genetic lottery.
  • From one parent, it gained a set of mutations that helped it evade antibodies from previous infections and vaccinations. From the other parent, it gained a separate set of mutations that made it even more evasive.
  • “XBB literally picked up the most possible mutations that it could possibly pick up from those two parents,” said Thomas Peacock, a virologist at Imperial College London. The new combination made XBB one of the most evasive Omicron subvariants in existence last summer.
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  • Recent experiments suggest that XBB paid a steep price for its power to evade immunity. The mutations allow it to escape antibodies by altering the shape of the protein, called spike, that covers its surface. But some of those mutations also make it harder for XBB spike proteins to grab tightly to cells — the first step required for an infection.
  • That loose grip may have lessened XBB’s advantage against other forms of the virus. In late 2022, it jostled alongside a number of other Omicron subvariants. In Singapore, XBB caused a surge in October, for example, while remaining rare in many other parts of the world.
  • As XBB multiplied, it continued to mutate into new forms. The earliest samples of XBB.1.5 were isolated in October in New York. The new subvariant gained one crucial mutation, known as F486P.
  • Yunlong Cao of Peking University and his colleagues tested out XBB.1.5 in dishes of cells, comparing how it fared against earlier forms of XBB. The researchers found that the F486P mutation allowed XBB.1.5 to grab tightly to cells again. But the new subvariant could still evade antibodies as well as earlier forms of XBB.
  • In Connecticut, for example, Nathan Grubaugh at Yale University and his colleagues found that by mid-December, other Omicron subvariants were falling. Only XBB.1.5 cases were growing. Dr. Grubaugh estimates that it is about 20 percent more transmissible than BQ.1, which had been the dominant form.
  • How severe XBB.1.5 infections are compared with other forms of the coronavirus is not yet clear. “It’s serious,” Dr. Grubaugh said. “I just don’t necessarily know if it’s really more serious than some of the other Omicron lineages in terms of the overall impact.”
  • XBB.1.5 has already spread to other countries, and is growing rapidly in Germany, Denmark and elsewhere in Europe
  • Scientists are already scanning new sequences being uploaded to an international database called GISAID in the hopes of spotting an upgraded version of XBB.1.5. But their job is getting harder because governments are pulling back on sequencing efforts. “Worldwide, sequencing has taken a real hit,” Dr. Peacock said.
  • The United States, which once lagged behind other nations, has managed to maintain a fairly strong sequencing effort. Without it, Dr. Peacock said, XBB.1.5 might have stayed below the radar for much longer. If XBB.1.5’s next generation is evolving somewhere with little sequencing, it may go undetected for some time to come.
  • Dr. Lemieux said that paring back on sequencing was a mistake, given how many infections and deaths the virus is still causing. “This is a part of public health,” he said.
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Opinion | America, China and a Crisis of Trust - The New York Times - 0 views

  • some eye-popping new realities about what’s really eating away at U.S.-China relations.
  • The new, new thing has a lot to do with the increasingly important role that trust, and its absence, plays in international relations, now that so many goods and services that the United States and China sell to one another are digital, and therefore dual use — meaning they can be both a weapon and a tool.
  • In the last 23 years America has built exactly one sort-of-high-speed rail line, the Acela, serving 15 stops between Washington, D.C., and Boston. Think about that: 900 to 15.
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  • it is easy to forget how much we have in common as people. I can’t think of any major nation after the United States with more of a Protestant work ethic and naturally capitalist population than China.
  • These days, it is extremely difficult for a visiting columnist to get anyone — a senior official or a Starbucks barista — to speak on the record. It was not that way a decade ago.
  • The Communist Party’s hold is also a product of all the hard work and savings of the Chinese people, which have enabled the party and the state to build world-class infrastructure and public goods that make life for China’s middle and lower classes steadily better.
  • Beijing and Shanghai, in particular, have become very livable cities, with the air pollution largely erased and lots of new, walkable green spaces.
  • some 900 cities and towns in China are now served by high-speed rail, which makes travel to even remote communities incredibly cheap, easy and comfortable
  • Just when trust has become more important than ever between the U.S. and China, it also has become scarcer than ever. Bad trend.
  • China’s stability is a product of both an increasingly pervasive police state and a government that has steadily raised standards of living. It’s a regime that takes both absolute control and relentless nation-building seriously.
  • For an American to fly from New York’s Kennedy Airport into Beijing Capital International Airport today is to fly from an overcrowded bus terminal to a Disney-like Tomorrowland.
  • China got an early jump on A.I. in two realms — facial recognition technology and health records — because there are virtually no privacy restrictions on the government’s ability to build huge data sets for machine learning algorithms to find patterns.
  • “ChatGPT is prompting some people to ask if the U.S. is rising again, like in the 1990s,”
  • “I understand your feeling: You have been in the first place for a century, and now China is rising, and we have the potential to become the first — and that is not easy for you,” Hu said to me. But “you should not try to stop China’s development. You can’t contain China in the end. We are quite smart. And very diligent. We work very hard. And we have 1.4 billion people.”
  • Before the Trump presidency, he added: “We never thought China-U.S. relations would ever become so bad. Now we gradually accept the situation, and most Chinese people think there is no hope for better relations. We think the relationship will be worse and worse and hope that war will not break out between our two countries.”
  • A lot of people hesitated when I asked. Indeed, many would answer with some version of “I’m not sure, I just know that it’s THEIR fault.”
  • t was repeated conversations like these that got me started asking American, Chinese and Taiwanese investors, analysts and officials a question that has been nagging at me for a while: What exactly are America and China fighting about?
  • the real answer is so much deeper and more complex than just the usual one-word response — “Taiwan” — or the usual three-word response — “autocracy versus democracy.”
  • Let me try to peel back the layers. The erosion in U.S.-China relations is a result of something old and obvious — a traditional great-power rivalry between an incumbent power (us) and a rising power (China) — but with lots of new twists
  • One of the twists, though, is that this standard-issue great-power rivalry is occurring between nations that have become as economically intertwined as the strands of a DNA molecule. As a result, neither China nor America has ever had a rival quite like the other.
  • in modern times, China, like America, has never had to deal with a true economic and military peer with which it was also totally intertwined through trade and investment.
  • Another new twist, and a reason it’s hard to define exactly what we’re fighting about, has a lot to do with how this elusive issue of trust and the absence of it have suddenly assumed much greater importance in international affairs.
  • This is a byproduct of our new technological ecosystem in which more and more devices and services that we both use and trade are driven by microchips and software, and connected through data centers in the cloud and high-speed internet
  • so many more things became “dual use.” That is, technologies that can easily be converted from civilian tools to military weapons, or vice versa.
  • no one country or company can own the whole supply chain. You need the best from everywhere, and that supply chain is so tightly intertwined that each company has to trust the others intimately.
  • when we install the ability to sense, digitize, connect, process, learn, share and act into more and more things — from your GPS-enabled phone to your car to your toaster to your favorite app — they all become dual use, either weapons or tools depending on who controls the software running them and who owns the data that they spin off.
  • As long as most of what China sold us was shallow goods, we did not care as much about its political system — doubly so because it seemed for a while as if China was slowly but steadily becoming more and more integrated with the world and slightly more open and transparent every year. So, it was both easy and convenient to set aside some of our worries about the dark sides of its political system.
  • when you want to sell us ‘deep goods’ — goods that are dual use and will go deep into our homes, bedrooms, industries, chatbots and urban infrastructure — we don’t have enough trust to buy them. So, we are going to ban Huawei and instead pay more to buy our 5G telecom systems from Scandinavian companies we do trust: Ericsson and Nokia.”
  • as we’ve seen in Ukraine, a smartphone can be used by Grandma to call the grandkids or to call a Ukrainian rocket-launching unit and give it the GPS coordinates of a Russian tank in her backyard.
  • So today, the country or countries that can make the fastest, most powerful and most energy efficient microchips can make the biggest A.I. computers and dominate in economics and military affairs.
  • As more and more products and services became digitized and electrified, the microchips that powered everything became the new oil. What crude oil was to powering 19th- and 20th-century economies, microchips are for powering 21st-century economies.
  • When you ask them what is the secret that enables TSMC to make 90 percent of the world’s most advanced logic chips — while China, which speaks the same language and shares the same recent cultural history, makes zero — their answer is simple: “trust.”
  • TSMC is a semiconductor foundry, meaning it takes the designs of the most advanced computer companies in the world — Apple, Qualcomm, Nvidia, AMD and others — and turns the designs into chips that perform different processing functions
  • TSMC makes two solemn oaths to its customers: TSMC will never compete against them by designing its own chips and it will never share the designs of one of its customers with another.
  • “Our business is to serve multiple competitive clients,” Kevin Zhang, senior vice president for business development at TSMC, explained to me. “We are committed not to compete with any of them, and internally our people who serve customer A will never leak their information to customer C.”
  • But by working with so many trusted partners, TSMC leverages the partners’ steadily more complex designs to make itself better — and the better it gets, the more advanced designs it can master for its customers. This not only requires incredibly tight collaboration between TSMC and its customers, but also between TSMC and its roughly 1,000 critical local and global suppliers.
  • As the physics of chip making gets more and more extreme, “the investment from customers is getting bigger and bigger, so they have to work with us more closely to make sure they harvest as much [computing power] as they can. They have to trust you.”
  • China also has a foundry, Semiconductor Manufacturing International Corporation, which is partly state-owned. But guess what? Because no global chip designers trust SMIC with their most advanced designs, it is at least a decade behind TSMC.
  • It’s for these reasons that the erosion in U.S.-China relations goes beyond our increasingly sharp disagreements over Taiwan. It is rooted in the fact that just when trust, and its absence, became much bigger factors in international affairs and commerce, China changed its trajectory. It made itself a less trusted partner right when the most important technology for the 21st century — semiconductors — required unprecedented degrees of trust to manufacture and more and more devices and services became deep and dual use.
  • when American trade officials said: “Hey, you need to live up to your W.T.O. commitments to restrict state-funding of industries,” China basically said: “Why should we live by your interpretation of the rules? We are now big enough to make our own interpretations. We’re too big; you’re too late.”
  • Combined with China’s failure to come clean on what it knew about the origins of Covid-19, its crackdown on democratic freedoms in Hong Kong and on the Uyghur Muslim minority in Xinjiang, its aggressive moves to lay claim to the South China Sea, its increasing saber rattling toward Taiwan, its cozying up to Vladimir Putin (despite his savaging of Ukraine), Xi’s moves toward making himself president for life, his kneecapping of China’s own tech entrepreneurs, his tighter restrictions on speech and the occasional abduction of a leading Chinese businessman — all of these added up to one very big thing: Whatever trust that China had built up with the West since the late 1970s evaporated at the exact moment in history when trust, and shared values, became more important than ever in a world of deep, dual-use products driven by software, connectivity and microchips.
  • it started to matter a lot more to Western nations generally and the United States in particular that this rising power — which we were now selling to or buying from all sorts of dual-use digital devices or apps — was authoritarian.
  • eijing, for its part, argues that as China became a stronger global competitor to America — in deep goods like Huawei 5G — the United States simply could not handle it and decided to use its control over advanced semiconductor manufacturing and other high-tech exports from America, as well as from our allies, to ensure China always remained in our rearview mirror
  • Beijing came up with a new strategy, called “dual circulation.” It said: We will use state-led investments to make everything we possibly can at home, to become independent of the world. And we will use our manufacturing prowess to make the world dependent on our exports.
  • Chinese officials also argue that a lot of American politicians — led by Trump but echoed by many in Congress — suddenly seemed to find it very convenient to put the blame for economic troubles in the U.S.’s middle class not on any educational deficiencies, or a poor work ethic, or automation or the 2008 looting by financial elites, and the crisis that followed, but on China’s exports to the United States.
  • As Beijing sees it, China not only became America’s go-to boogeyman, but in their frenzy to blame Beijing for everything, members of Congress started to more recklessly promote Taiwan’s independence.
  • Xi told President Biden at their summit in Bali in November, in essence: I will not be the president of China who loses Taiwan. If you force my hand, there will be war. You don’t understand how important this is to the Chinese people. You’re playing with fire.
  • at some level Chinese officials now understand that, as a result of their own aggressive actions in recent years on all the fronts I’ve listed, they have frightened both the world and their own innovators at precisely the wrong time.
  • I don’t buy the argument that we are destined for war. I believe that we are doomed to compete with each other, doomed to cooperate with each other and doomed to find some way to balance the two. Otherwise we are both going to have a very bad 21st century.
  • I have to say, though, Americans and Chinese remind me of Israelis and Palestinians in one respect: They are both expert at aggravating the other’s deepest insecurities.
  • China’s Communist Party is now convinced that America wants to bring it down, which some U.S. politicians are actually no longer shy about suggesting. So, Beijing is ready to crawl into bed with Putin, a war criminal, if that is what it takes to keep the Americans at bay.
  • Americans are now worried that Communist China, which got rich by taking advantage of a global market shaped by American rules, will use its newfound market power to unilaterally change those rules entirely to its advantage. So we’ve decided to focus our waning strength vis-à-vis Beijing on ensuring the Chinese will always be a decade behind us on microchips.
  • I don’t know what is sufficient to reverse these trends, but I think I know what is necessary.
  • If it is not the goal of U.S. foreign policy to topple the Communist regime in China, the United States needs to make that crystal clear, because I found a lot more people than ever before in Beijing think otherwise.
  • As for China, it can tell itself all it wants that it has not taken a U-turn in recent years. But no one is buying it. China will never realize its full potential — in a hyper-connected, digitized, deep, dual-use, semiconductor-powered world — unless it understands that establishing and maintaining trust is now the single most important competitive advantage any country or company can have. And Beijing is failing in that endeavor.
  • In his splendid biography of the great American statesman George Shultz, Philip Taubman quotes one of Shultz’s cardinal rules of diplomacy and life: “Trust is the coin of the realm.”
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Opinion | A Simple Fix for the Antisemitism Awareness Act - The New York Times - 0 views

  • it’s necessary to understand the legal ambiguities that now exist on campus. “No person in the United States,” Title VI of the Civil Rights Act of 1964 states, “shall, on the ground of race, color or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving federal financial assistance.” There is no corresponding federal prohibition on discrimination on the basis of religion.
  • The problem is immediately obvious. Jewishness doesn’t fit neatly into any of those three categories. Israelis of all races, religions and ethnicities are protected because of their national origin, but what about American Jews? Judaism is a religion, and religion isn’t covered. Jewishness is more of an ancestry than a “race” or a “color” — there are Jews of many races and colors.
  • There is an answer to the problem. Congress should pass legislation clearly stating that antisemitism is included in the scope of Title VI.
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  • Biden’s Department of Education has interpreted Title VI to apply when students “experience discrimination, including harassment,” on the basis of their “shared ancestry or ethnic characteristics.”
  • these statements — even if fairly rooted in the text of Title VI — are not a solution
  • Executive orders and administrative regulations are more ephemeral than federal statutes. The next president (or one elected in 2036 or 2052) may choose to interpret Title VI differently. Biden’s interpretation is broader than Trump’s, for example. Courts will also have their own say, and they are now less deferential to presidential interpretations of the law than they’ve been in decades.
  • The definitions don’t just implicate the First Amendment, they also breed confusion around the very concept of harassment itself. Hearing unpleasant or even hateful thoughts or ideas isn’t “harassment.”
  • The best parts of the Antisemitism Awareness Act explicitly incorporate discrimination based on “actual or perceived shared ancestry or ethnic characteristics” into federal statutory law, elevating the legal protections well beyond the executive orders and guidance letters of previous administrations.
  • If the law had stopped there — or even if it had gone further and explicitly stated that discrimination on the basis of actual or perceived Jewish identity is by definition discrimination on the basis of shared ancestry, then it would be a vital addition to federal law.
  • But the law did not stop there. It goes on to require schools to consider the International Holocaust Remembrance Alliance’s working definition of antisemitism when determining whether there has been a violation of Title VI
  • This is a serious mistake. The alliance’s definition includes examples of antisemitism that encompass a broad range of statements that are protected by the First Amendment.
  • Both the Trump and the Biden administrations attempted to solve the problem by interpreting Title VI to apply to antisemitism, at least in some circumstances. The Trump administration issued an executive order stating that “discrimination against Jews may give rise to a Title VI violation when the discrimination is based on an individual’s race, color or national origin.”
  • That’s an inescapable part of life in a free, pluralistic nation
  • Harassment is something else entirely.
  • In a 1999 case, Davis v. Monroe County Board of Education, the Supreme Court defined student-on-student harassment under Title IX (the federal statute prohibiting sex discrimination in federally funded education) as conduct “so severe, pervasive and objectively offensive, and that so undermines and detracts from the victims’ educational experience, that the victims are effectively denied equal access to an institution’s resources and opportunities.”
  • Harassment doesn’t depend so much on the content or viewpoint of the objectionable speech as where, when and how it happens.
  • If students chant, “Globalize the intifada,” at a lawful public protest, then that’s protected
  • If they shout down Jewish students in class using the same phrase, or chant it outside the dorm rooms of Jewish students at 3 a.m., then they’re engaging in harassment. Jewish students can’t study or sleep on an equal basis with other students.
  • In both of those circumstances, the actual content of the words is less important than the timing and the targets. A person can commit an act of antisemitic harassment if he targets Jewish students with words that have nothing to do with ancestry or ethnicity
  • For example, if someone stands outside a Jewish student’s room night after night yelling, “Michael Jordan is the GOAT” relentlessly so that the student can’t sleep or targets her Jewish roommate with constant interruption and distraction then she’s engaging in antisemitic harassment not because of the content or viewpoint of the words, but rather because of the identity of the target and the time and manner of the speech.
  • I’d like to humbly offer a better way. Strip the problematic incorporation of the alliance’s antisemitism definition and examples from the bill entirely. Instead, simply amend Title VI itself to make it explicit that discrimination based on “actual or perceived shared ancestry or ethnic characteristics” is prohibited by the statute and that antisemitic discrimination meets that definition.
  • by revising Title VI to clearly prohibit discrimination against Jews without any further amplification or definition, antisemitic harassment will fit neatly into existing case law that has longed harmonized free speech principles and nondiscrimination law
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Opinion | Germany Has Finally Woken Up - The New York Times - 0 views

  • German democracy is not well. The problem is not just the rise of the AfD, which has become strong enough in some regions to aspire to positions of power or at least to seriously disrupt the process of forming stable governments.
  • It’s that in many parts of the country, a general sense of discontent has tipped over into disdain. People now reject not just the current government but the whole political system.
  • it is true that Germans have had to deal with a lot: the war in Ukraine, an energy crisis, inflation and, most recently, the painful fallout from war in Gaza. Even though immigration is rising, we still lack skilled labor — teachers, plumbers, I.T. specialists — and public infrastructure is crumbling. Add in an ambitious government green transition agenda hamstrung by brutal infighting and you get a grim picture. Everything, it seems, is changing — and not for the better.
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  • Anecdotally, it seems like everybody knows someone who has dropped out of the mainstream, vowing to vote for the AfD or talking about emigrating
  • What has started to dawn on us in recent months, and what the meeting in Potsdam laid bare, is that the far right is not about having horrific ideas — it is about enacting horrific ideas.
  • Germany’s far-right adherents really mean it. With funding, support and a very real chance of winning federal states this year, they are closer to power than they have ever been in the nearly 75-year history of post-Nazi Germany.
  • In his recent book “Triggerpunkte,” or “Trigger Points,” Steffen Mau, a sociologist at Humboldt University in Berlin, rejects the notion that German society is polarized neatly in two. In Germany, he argues, divisions instead run through several areas such as climate, migration and social justice. You can be moved by some issues, indifferent to others
  • In recent months, those motivated by their opposition to migration or climate policies were the most vocal and visible. Now those who care about democracy, minority rights and the rule of law have reached their trigger point, too.
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Dilemma on Wall Street: Short-Term Gain or Climate Benefit? - The New York Times - 0 views

  • team of economists recently analyzed 20 years of peer-reviewed research on the social cost of carbon, an estimate of the damage from climate change. They concluded that the average cost, adjusted for improved methods, is substantially higher than even the U.S. government’s most up-to-date figure.
  • That means greenhouse gas emissions, over time, will take a larger toll than regulators are accounting for. As tools for measuring the links between weather patterns and economic output evolve — and the interactions between weather and the economy magnify the costs in unpredictable ways — the damage estimates have only risen.
  • It’s the kind of data that one might expect to set off alarm bells across the financial industry, which closely tracks economic developments that might affect portfolios of stocks and loans. But it was hard to detect even a ripple.
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  • In fact, the news from Wall Street lately has mostly been about retreat from climate goals, rather than recommitment. Banks and asset managers are withdrawing from international climate alliances and chafing at their rules. Regional banks are stepping up lending to fossil fuel producers. Sustainable investment funds have sustained crippling outflows, and many have collapsed.
  • In some cases, it’s a classic prisoner’s dilemma: If firms collectively shift to cleaner energy, a cooler climate benefits everyone more in the future
  • in the short term, each firm has an individual incentive to cash in on fossil fuels, making the transition much harder to achieve.
  • when it comes to avoiding climate damage to their own operations, the financial industry is genuinely struggling to comprehend what a warming future will mean.
  • A global compact of financial institutions made commitments worth $130 trillion to try to bring down emissions, confident that governments would create a regulatory and financial infrastructure to make those investments profitable. And in 2022, the Inflation Reduction Act passed.
  • What about the risk that climate change poses to the financial industry’s own investments, through more powerful hurricanes, heat waves that knock out power grids, wildfires that wipe out towns?
  • “If we think about what is going to be the best way to tilt your portfolios in the direction to benefit, it’s really difficult to do,”
  • “These will probably be great investments over 20 years, but when we’re judged over one to three years, it’s a little more challenging for us.”
  • Some firms cater to institutional clients, like public employee pension funds, that want combating climate change to be part of their investment strategy and are willing to take a short-term hit. But they aren’t a majority
  • And over the past couple of years, many banks and asset managers have shrunk from anything with a climate label for fear of losing business from states that frown on such concerns.
  • On top of that, the war in Ukraine scrambled the financial case for backing a rapid energy transition. Artificial intelligence and the movement toward greater electrification are adding demand for power, and renewables haven’t kept up
  • All of that is about the relative appeal of investments that would slow climate change
  • If you bought some of the largest solar-energy exchange-traded funds in early 2023, you would have lost about 20 percent of your money, while the rest of the stock market soared.
  • There is evidence that banks and investors price in some physical risk, but also that much of it still lurks, unheeded.
  • “I’m very, very worried about this, because insurance markets are this opaque weak link,” Dr. Sastry said. “There are parallels to some of the complex linkages that happened in 2008, where there is a weak and unregulated market that spills over to the banking system.”
  • Regulators worry that failing to understand those ripple effects could not just put a single bank in trouble but even become a contagion that would undermine the financial system.
  • But while the European Central Bank has made climate risk a consideration in its policy and oversight, the Federal Reserve has resisted taking a more active role, despite indications that extreme weather is feeding inflation and that high interest rates are slowing the transition to clean energy.
  • “The argument has been, ‘Unless we can convincingly show it’s part of our mandate, Congress should deal with it, it’s none of our business,’”
  • a much nearer-term uncertainty looms: the outcome of the U.S. election, which could determine whether further action is taken to address climate concerns or existing efforts are rolled back. An aggressive climate strategy might not fare as well during a second Trump administration, so it may seem wise to wait and see how it shakes out.
  • big companies are hesitating on climate-sensitive investments as November approaches, but says that “two things are misguided and quite dangerous about that hypothesis.”
  • One: States like California are establishing stricter rules for carbon-related financial disclosures and may step it up further if Republicans win
  • And two: Europe is phasing in a “carbon border adjustment mechanism,” which will punish polluting companies that want to do business there.
  • at the moment, even European financial institutions feel pressure from the United States, which — while providing some of the most generous subsidies so far for renewable-energy investment — has not imposed a price on carbon.
  • The global insurance company Allianz has set out a plan to align its investments in a way that would prevent warming above 1.5 degrees Celsius by the end of the century, if everyone else did the same. But it’s difficult to steer a portfolio to climate-friendly assets while other funds take on polluting companies and reap short-term profits for impatient clients.
  • “This is the main challenge for an asset manager, to really bring the customer along,” said Markus Zimmer, an Allianz economist. Asset managers don’t have sufficient tools on their own to move money out of polluting investments and into clean ones, if they want to stay in business,
  • “Of course it helps if the financial industry is somehow ambitious, but you cannot really substitute the lack of actions by policymakers,”
  • According to new research, the benefit is greater when decarbonization occurs faster, because the risks of extreme damage mount as time goes on. But without a uniform set of rules, someone is bound to scoop up the immediate profits, disadvantaging those that don’t — and the longer-term outcome is adverse for all.
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Opinion | Belgium Shows What Europe Has Become - The New York Times - 0 views

  • In Brussels, the seat of the European Union, rising crime, pollution and decaying infrastructure symbolize a continent in decline. With unusual clarity, Belgium shows what Europe has become in the 21st century: a continent subject to history rather than driving it.
  • For a long time, Belgian politicians and citizens hoped that European integration would release them from their own tribal squabbles. Who needed intricate federal coalitions if the behemoth in Brussels would soon take over? Except for the army and the national museums, all other levers of policy could comfortably be transferred,
  • The upward absorption has not come to pass. The European Union remains a halfway house between national government and continental superstate. There is no E.U. army or capacious fiscal apparatus. Consequently, Belgium has been put in an awkward position. Unable to collapse itself into Europe, it is stuck with a ramshackle federal state
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  • As the ideological glue that allows Belgians to cohabit has come unstuck, the traditional parties of government have found it difficult to retain public backing. Amid a wider fracturing of the vote, Flemish and Walloon voters are now lured by adventurers on right and left
  • Belgium serves as a stern reminder that there are few bulwarks against the trends that ail European nations. The country is no Italy or Netherlands, where the far right is already in government, and party democracy and its postwar prosperity survive only as faint memories.
  • Yet even with Belgium’s lower inequality rates, higher union membership and comparatively stronger party infrastructure, the march of the far right has also proved eerily unstoppable.
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