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How a Free Market Inevitably Produces Dictatorship

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Who rules the land? A deeper and truer version of this question is: What rules the land? Is it the money (the aristocracy), or is it the people (the public, the residents on that land)? (For the interest of paleoconservatives, the issue of residents’ citizenship will come later here, as “immigrants” instead of as “citizenship”; but our basic focus is not ethnicity/nationality; it’s class: the money, versus the voters; not the natives, versus the foreigners.)

In a democracy, the public rule — the people do — and it’s on authentically a one-person-one-vote basis, and anyone who is a resident in that land can easily vote, just like anyone else who lives there, because only the residents there, during the specific time-period of the voting, are the ultimate decision-makers, over that land, and over its laws. This is what a democracy is: it’s one-person-one-vote, and, in the political sense, it’s total equality-of-rights and total equality-of-obligations — real and total equality-by-law: equal rights, and equal obligations, for all residents. A democracy applies the same requirements to everyone.

This does not mean that individuals are equal in their abilities and in their needs, and so it’s not a statement about the economy; it is purely a statement about the government — a political question. The economy is a separate matter, though it’s highly dependent upon the government — the laws that are in place and enforced. Many people confuse these two fields, and mistakenly think that the economy is basic to the government.

So: the economy is dependent upon the government; the government determines the economy, which, in any land, is highly dependent upon the laws that are in place and that are enforced — the government.

That’s only “natural persons” who control a democracy — no collectives of any type, corporate or otherwise, can vote, because, if it were otherwise, it would be an easy way to establish a dictatorship there: persons with the financial means could create any number of “artificial persons” who could vote, or could buy votes (such as by purchasing news-media to slant ‘reality’ selling politicians and political positions to the voters), and this money could produce a country controlled more by dollars, than by owners (i.e., than by actual persons, votersnot by artificial “persons” such as the wealth-collections that are known as corporations). If wealth-collections could vote, that would invite control over the land to be by wealth (the number of dollars) instead of by actual residents (the number of persons). It could even produce control by foreign wealth. Foreigners could end up controlling the country if the number of dollars is a bigger determinant of who rules than is the number of voters.

Obviously, no democracy will allow foreigners to control the land. Imperialism is inconsistent with democracy; any empire is dictatorial, by its very nature. It entails dictatorship over the residents in its colonies, even if not necessarily over the residents in the imperial land that had conquered the colonial area.

Empire is consistent with a free market, but it is inconsistent with democracy. No empire is democratic, because each colony is ruled by non-residents. (If the colony were ruled by its residents, it wouldn’t be a colony, and there wouldn’t be an empire.)

A federation is not an empire. The difference between them is that, whereas in a federation, the right of self-determination of peoples takes precedence over the federation’s interest in maintaining the status-quo; in an empire, there is no such right — an empire is a dictatorship. In political matters, no empire has a right to be an empire; just as, in economic matters, no person can actually own another (notwithstanding any ‘slave’-‘owner’ — or ‘seller’ — falsely believing to the contrary).

The propaganda for a free market is funded very heavily by billionaires such as the Koch brothers and George Soros, because control over countries naturally devolves into control by wealth, instead of into control by people (and certainly not by residents), if a free-market economy exists there. Billionaires do whatever increases their power; and, beyond around $100,000-per-year of income, any additional wealth buys no additional happiness or satisfaction, but only additional status, which, for individuals who are in such brackets, is derived from increases in their power, because, at that stage of wealth, money itself is no longer an object, only status is, and additional status can be derived only from additional power. All of the empirical findings in the social sciences are consistent with this; and, whereas the income-point in most of those studies, beyond which additional dollars produce no additional happiness for the owner, has been $75,000 per year, there has been inflation since those studies were performed, and one might more accurately say today that $100,000-per-year is the income-point beyond which only status is increased by additional income; happiness or satisfaction is not increased by income above that point. This is a statement about nature; it is the reality in which any market — free or otherwise — exists. It is “human nature,” and that’s basic to all of the social sciences which pertain to humans, including political science, and economics.

In economic theory, the phrase that has been traditionally used to refer to this reality, even before recent empirical studies showed the reality to be this way, was “the declining marginal utility of money.” Beyond around $100,000/year, additional “bucks” are for status, not for happiness. Anyone who has no addiction to status, doesn’t care about having more money coming in beyond that amount. Beyond that amount, the additional marginal utility of each dollar received is actually zero. The wealth-addict might crave more, but it won’t do him-or-her any actual good; it won’t make the person happier. That’s the reality, now proven in numerous empirical studies.

This reality has major political consequences. One is that a country with highly concentrated wealth (the bottom 50% own almost nothing) is serving the addictions of a few, not the needs of the many — and therefore concentrated wealth cannot be sustained in a democracy, but only in a dictatorship: a dictatorship of wealth, where what determines power isn’t the voters but the dollars.

An important philosophical champion of free markets is the libertarian philosopher Hans-Hermann Hoppe. In 2001, Hoppe published his DEMOCRACY: The God that Failed, which was considered a libertarian masterpiece. Hoppe unapologetically argued there that libertarianism and conservatism are one and the same — and that he wanted it, passionately: he hated democracy. Unlike many libertarians, who falsely allege that democracy is impossible without there first being libertarianism (a free market), Hoppe acknowledged and argued for the mutual inconsistency between libertarianism and democracy. Although I don’t share his preference for a rule by the wealth instead of a rule by the residents, and thus he is an ideological opponent — the opposite of a supporter of my own position, as it’s being set forth here (and far more briefly than his tome) — I consider him to be the fullest and most internally consistent libertarian philosopher, and perhaps the most significant libertarian political philosopher in this Century, thus far. Whereas lots of people call themselves “libertarian,” he actually is — fully — that. Of course, some libertarians don’t agree with Hoppe’s view; but, on 30 August 2011, Michael Lind at salon.com headlined “Why Libertarians Apologize for Autocracy: The experience of every democratic nation-state proves that libertarianism is incompatible with democracy,” and he empirically found that Hoppe was correct about this incompatibility.

Hoppe argues not only for an aristocracy, but for a hereditary one, and he even opposes immigration; so, if he were a democrat, at all, then he’d be excluding immigrants from voting. But he’s not even that much of a democrat. And he especially approves of hereditary monarchy. His reason for that preference is traditional libertarianism, which favors the private over the public: “Hereditary monarchies represent the historical example of privately owned governments, and democratic republics that of publicly owned governments.” Libertarianism opposes public ownership, favors private.

Like any philosopher, Hoppe has ignored crucial issues in order to sell his case (after all, it’s a philosophical, not a scientific, case; it is ideological propaganda alleging that libertarianism is good — instead of being anything scientific); and the most interesting thing that he has avoided discussing in it is anti-trust, anti-monopoly, anti-oligopoly — the issues about concentration of power. He ignores those issues. For example, whenever he uses the term “monopoly,” he is referring solely to “government,” never to the economy (he assumes that in a free market there can’t be any oligopolies or monopolies). He is, after all, a crank (a free-market political theorist and therefore someone who implicitly denies that government is basic to an economy, and who assumes the converse, that the government is instead built upon the economy), though he’s an erudite one and thus acceptable to his fellow-scholars. Erudition doesn’t mean, nor necessarily include, being scientific. And the (scientific) reality is that the political issue isn’t ‘the government’s monopoly on power’, but instead it’s simply any concentrations of power — both monopolies and oligopolies — which unequalize both rights and obligations in the society, such that whereas a few people (the aristocracy) have many rights and few (if any) obligations, most people (the public) have few rights and many obligations. The latter type of society is called a “dictatorship.” The more that it exists, the more that it comes to exist — and, consequently, the less that there can exist democracy.

The basic issue in political science is not “freedom” versus “slavery” (two concepts in economics); it is “democracy” versus “dictatorship” (two concepts in politics).

Power precedes the economy; it directs the economy, if and where an economy even exists.

Democracy is natural where wealth is nearly-evenly distributed. Dictatorship is natural where wealth is extremely-unevenly distributed. The latter is true because no nation can maintain a democracy if the wealth is highly unequal. If the wealth is highly equal, then the possibility for democracy to emerge is substantial. But if the wealth is highly unequal, then the possibility for democracy even to exist to any extent, is low. All of the extremely wealthy people would have to be honest in order for them to tolerate rule by the majority. Otherwise, they’d simply be using their news-media to deceive instead of to inform the public: that’s what the ‘news’-people would be paid to do, cover-up real problems, and manufacture ‘reality’ — manipulate the public, instead of inform the public. If the distribution of wealth is highly unequal, the ‘news’people will be paid to deceive the public, instead of to inform the public. This (and it includes the ‘charitable’ foundations) is why the majority of the public have come to believe the profoudly false assertion that “having a rich class is a benefit” to the public. They’ve been deceived.

Most of the world is dictatorial. That’s because, almost everywhere, wealth, and even income, is extremely unevenly distributed. The laws and their enforcement determine the distribution of wealth and of income. The natural tendency is toward dictatorship, because a free market produces increased economic concentration. Democracy is not natural. Dictatorship is natural. What’s natural for a body-politic is to fulfill addictions, not to fulfill needs.

As inequality of wealth increases, corruption also increases. Empirical studies find that successful people tend to be bad: it’s natural for the scum and not the cream to rise to the top in organizations. So, the wealthier a person is, the worse the person tends to be. And it’s not just that, but success itself tends to make a person worse than the person was before the success. So, it’s natural that at the very top, tend to be the very worst people. Good government is not natural; bad government is natural. Good government is unnatural.

Corruption is rule by deceit. An example of how that works at the federal-government level is here. An example of that in more detail is here. Another such detailed example, but at the state-or-local government level, is here. And an example of it within academia, and at the federal regulatory agencies, is here. So, in a country that has extreme wealth-inequality, the way in which the public’s ‘consent’, to the billionaires’ rule, is manufactured, is by means of deceit — a rot that’s throughout the entire body-politic and society. This is how an extreme inequality of wealth is produced. It cannot be done honestly. Transparency International has reported that corruption and “social exclusion” or bigotry tend to go together, but has ignored the possible relationship between corruption and the economic distribution of either wealth or income. Perhaps the billionaires who fund TI don’t want such correlations to be pointed out, if they exist; so TI doesn’t investigate this.

The reason why a free market inevitably increases dictatorship, is that dictatorship is natural, just as a free market itself is natural, and power pre-exists everywhere to upset and overturn any equality that might exist in either sphere. Power is natural. No economy exists but that power pre-exists. The political sphere pre-exists the economic sphere. The basic reality, in any society, is power.

Thus, the question has always been: What rules? Is it the wealth? Or is it the people? The natural condition is for wealth to rule, because money (especially all excess money, all income above $100,000 per year, and certainly all income above $1,000,000 per year — what can truthfully be called 100% political money, because it can be ‘given away’ with no real loss to the current owner) is power. Although wealth isn’t the only source of power, it is a major source of power. (It can even be the major source of power.) And power rules everywhere. By definition, power rules in politics; and, by nature, the wealthy tend to rule not only in the economy, but also in the government.

That’s what’s natural. Democracy isn’t natural, but a free market, and an aristocratic government, are both natural. And the political reality determines the economic reality.

PS: You have just read here an entire online book. This article, including all of its sources that are linked-to, and the sources that are linked-to in those sources, constitute more than an ordinary book. The complete case and its documentation are fully presented in it. Anyone who finds this book valuable, might also find valuable, as a follow-up to it, a book of the traditional sort: Marjorie Kelly’s The Divine Right of Capital. Her Introduction there says, “The problem is not the free market, but the design of the corporation.” The first clause is false, but the second clause is true, and her book focuses in on that and gets it right. Any solution to either problem would need to be based on an accurate understanding of both of them. The bigger of the two problem-areas is the one that has been addressed in the present book-article. The second area is maybe 10% as large, but it too is significant, and what she says about it is true.

PPS: If you like this article, please pass it along to your friends, if only to get their feedback on it. They’re not likely to have encountered elsewhere the information it contains.

Author’s note: first posted at strategic-culture.org

Investigative historian Eric Zuesse is the author, most recently, of They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010

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Americas

Interpreting the Biden Doctrine: The View From Moscow

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Official White House Photo by Carlos Fyfe

It is the success or failure of remaking America, not Afghanistan, that will determine not just the legacy of the Biden administration, but the future of the United States itself.

The newly unveiled Biden doctrine, which renounces the United States’ post-9/11 policies of remaking other societies and building nations abroad, is a foreign policy landmark. Coming on the heels of the U.S. withdrawal from Afghanistan, it exudes credibility. Indeed, President Biden’s moves essentially formalize and finalize processes that have been under way for over a decade. It was Barack Obama who first pledged to end America’s twin wars—in Iraq and Afghanistan—started under George W. Bush. It was Donald Trump who reached an agreement with the Taliban on a full U.S. military withdrawal from Afghanistan in 2021. Both Obama and Trump also sought, albeit in strikingly different ways, to redirect Washington’s attention to shoring up the home base.

It is important for the rest of the world to treat the change in U.S. foreign policy correctly. Leaving Afghanistan was the correct strategic decision, if grossly overdue and bungled in the final phases of its implementation. Afghanistan certainly does not mean the end of the United States as a global superpower; it simply continues to be in relative and slow decline. Nor does it spell the demise of American alliances and partnerships. Events in Afghanistan are unlikely to produce a political earthquake within the United States that would topple President Biden. No soul searching of the kind that Americans experienced during the Vietnam War is likely to emerge. Rather, Washington is busy recalibrating its global involvement. It is focusing even more on strengthening the home base. Overseas, the United States is moving from a global crusade in the name of democracy to an active defense of liberal values at home and Western positions abroad.

Afghanistan has been the most vivid in a long series of arguments that persuaded Biden’s White House that a global triumph of liberal democracy is not achievable in the foreseeable future. Thus, remaking problematic countries—“draining the swamp” that breeds terrorism, in the language of the Bush administration—is futile. U.S. military force is a potent weapon, but no longer the means of first resort. The war on terror as an effort to keep the United States safe has been won: in the last twenty years, no major terrorist attacks occurred on U.S. soil. Meantime, the geopolitical, geoeconomic, ideological, and strategic focus of U.S. foreign policy has shifted. China is the main—some say, existential—challenger, and Russia the principal disrupter. Iran, North Korea, and an assortment of radical or extremist groups complete the list of adversaries. Climate change and the pandemic have risen to the top of U.S. security concerns. Hence, the most important foreign policy task is to strengthen the collective West under strong U.S. leadership.

The global economic recession that originated in the United States in 2007 dealt a blow to the U.S.-created economic and financial model; the severe domestic political crisis of 2016–2021 undermined confidence in the U.S. political system and its underlying values; and the COVID-19 disaster that hit the United States particularly hard have all exposed serious political, economic, and cultural issues and fissures within American society and polity. Neglecting the home base while engaging in costly nation-building exercises abroad came at a price. Now the Biden administration has set out to correct that with huge infrastructure development projects and support for the American middle class.

America’s domestic crises, some of the similar problems in European countries, and the growing gap between the United States and its allies during the Trump presidency have produced widespread fears that China and Russia could exploit those issues to finally end U.S. dominance and even undermine the United States and other Western societies from within. This perception is behind the strategy reversal from spreading democracy as far and wide as Russia and China to defending the U.S.-led global system and the political regimes around the West, including in the United States, from Beijing and Moscow.

That said, what are the implications of the Biden doctrine? The United States remains a superpower with enormous resources which is now trying to use those resources to make itself stronger. America has reinvented itself before and may well be able to do so again. In foreign policy, Washington has stepped back from styling itself as the world’s benign hegemon to assume the combat posture of the leader of the West under attack.

Within the collective West, U.S. dominance is not in danger. None of the Western countries are capable of going it alone or forming a bloc with others to present an alternative to U.S. leadership. Western and associated elites remain fully beholden to the United States. What they desire is firm U.S. leadership; what they fear is the United States withdrawing into itself. As for Washington’s partners in the regions that are not deemed vital to U.S. interests, they should know that American support is conditional on those interests and various circumstances. Nothing new there, really: just ask some leaders in the Middle East. For now, however, Washington vows to support and assist exposed partners like Ukraine and Taiwan.

Embracing isolationism is not on the cards in the United States. For all the focus on domestic issues, global dominance or at least primacy has firmly become an integral part of U.S. national identity. Nor will liberal and democratic ideology be retired as a major driver of U.S. foreign policy. The United States will not become a “normal” country that only follows the rules of realpolitik. Rather, Washington will use values as a glue to further consolidate its allies and as a weapon to attack its adversaries. It helps the White House that China and Russia are viewed as malign both across the U.S. political spectrum and among U.S. allies and partners, most of whom have fears or grudges against either Moscow or Beijing.

In sum, the Biden doctrine does away with engagements that are no longer considered promising or even sustainable by Washington; funnels more resources to address pressing domestic issues; seeks to consolidate the collective West around the United States; and sharpens the focus on China and Russia as America’s main adversaries. Of all these, the most important element is domestic. It is the success or failure of remaking America, not Afghanistan, that will determine not just the legacy of the Biden administration, but the future of the United States itself.

From our partner RIAC

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AUKUS aims to perpetuate the Anglo-Saxon supremacy

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Image credit: ussc.edu.au

On September 15, U.S. President Joe Biden worked with British Prime Minister Boris Johnson and Australian Prime Minister Scott Morrison together to unveil a trilateral alliance among Australia-U.K.-U.S. (AUKUS), which are the major three among the Anglo-Saxon nations (also including Canada and New Zealand). Literally, each sovereign state has full right to pursue individual or collective security and common interests. Yet, the deal has prompted intense criticism across the world including the furious words and firm acts from the Atlantic allies in Europe, such as France that is supposed to lose out on an $40-billion submarine deal with Australia to its Anglo-Saxon siblings—the U.K. and the U.S.

               Some observers opine that AUKUS is another clear attempt by the U.S. and its allies aggressively to provoke China in the Asia-Pacific, where Washington had forged an alliance along with Japan, India and Australia in the name of the Quad. AUKUS is the latest showcase that three Anglo-Saxon powers have pretended to perpetuate their supremacy in all the key areas such as geopolitics, cybersecurity, artificial intelligence, and quantum computing. In short, the triple deal is a move designed to discourage or thwart any future Chinese bid for regional hegemony. But diplomatically its impacts go beyond that. As French media argued that the United States, though an ally of France, just backstabs it by negotiating AUKUS in secret without revealing the plan. Given this, the deal among AUKUS actually reflects the mentality of the Anglo-Saxon nations’ superiority over others even if they are not outrageously practicing an imperialist policy in the traditional way.

               Historically, there are only two qualified global powers which the Europeans still sometimes refer to as “Anglo-Saxon” powers: Great Britain and the United States. As Walter Mead once put it that the British Empire was, and the United States is, concerned not just with the balance of power in one particular corner of the world, but with the evolution of what it is today called “world order”. Now with the rise of China which has aimed to become a global power with its different culture and political views from the current ruling powers, the Anglo-Saxon powers have made all efforts to align with the values-shared allies or partners to create the strong bulwarks against any rising power, like China and Russia as well. Physically, either the British Empire or the United States did or does establish a worldwide system of trade and finance which have enabled the two Anglo-Saxon powers to get rich and advanced in high-technologies. As a result, those riches and high-tech means eventually made them execute the power to project their military force that ensure the stability of their-dominated international systems. Indeed the Anglo-Saxon powers have had the legacies to think of their global goals which must be bolstered by money and foreign trade that in turn produces more wealth. Institutionally, the Anglo-Saxon nations in the world—the U.S., the U.K, Canada, Australia and New Zealand—have formed the notorious “Five eyes alliance” to collect all sorts of information and data serving their common core interests and security concerns.

This is not just rhetoric but an objective reflection of the mentality as Australian Foreign Minister Payne candidly revealed at the press conference where she said that the contemporary state of their alliance “is well suited to cooperate on countering economic coercion.” The remarks imply that AUKUS is a military response to the rising economic competition from China because politics and economics are intertwined with each other in power politics, in which military means acts in order to advance self-interested economic ends. In both geopolitical and geoeconomic terms, the rise of China, no matter how peaceful it is, has been perceived as the “systematic” challenges to the West’s domination of international relations and global economy, in which the Anglo-Saxon superiority must remain. Another case is the U.S. efforts to have continuously harassed the Nord Stream 2 project between Russia and Germany.

Yet, in the global community of today, any superpower aspiring for pursuing “inner clique” like AUKUS will be doomed to fail. First, we all are living in the world “where the affairs of each country are decided by its own people, and international affairs are run by all nations through consultation,” as President Xi put it. Due to this, many countries in Asia warn that AUKUS risks provoking a nuclear arms race in the Asian-Pacific region. The nuclear factor means that the U.S. efforts to economically contain China through AUKUS on nationalist pretexts are much more dangerous than the run-up to World War I. Yet, neither the United States nor China likes to be perceived as “disturbing the peace” that Asian countries are eager to preserve. In reality, Asian countries have also made it clear not to take either side between the power politics.

Second, AUKUS’s deal jeopardizes the norms of international trade and treaties. The reactions of third parties is one key issue, such as the French government is furious about the deal since it torpedoes a prior Australian agreement to purchase one dozen of conventional subs from France. Be aware that France is a strong advocate for a more robust European Union in the world politics. Now the EU is rallying behind Paris as in Brussels EU ambassadors agreed to postpone preparations for an inaugural trade and technology council on September 29 with the U.S. in Pittsburgh. European Commission President Ursula von der Leyen declared in a strong manner that “since one of our member states has been treated in a way that is not acceptable, so we need to know what happened and why.” Michael Roth, Germany’s minister for European affairs, went even further as he put it, “It is once again a wake-up call for all of us in the European Union to ask ourselves how we can strengthen our sovereignty, how we can present a united front even on issues relevant to foreign and security policy.” It is the time for the EU to talk with one voice and for the need to work together to rebuild mutual trust among the allies.

Third, the deal by AUKUS involves the nuclear dimension. It is true that the three leaders have reiterated that the deal would be limited to the transfer of nuclear propulsion technology (such as reactors to power the new subs) but not nuclear weapons technology. Accordingly, Australia remains a non-nuclear country not armed with such weapons. But from a proliferation standpoint, that is a step in the direction of more extensive nuclear infrastructure. It indicates the United States and the U.K. are willing to transfer highly sensitive technologies to close allies. But the issue of deterrence in Asia-and especially extended deterrence-is extremely complicated since it will become ore so as China’s nuclear arsenal expands. If the security environment deteriorates in the years ahead, U.S. might consider allowing its core allies to gain nuclear capabilities and Australia is able to gain access to this technology as its fleet expands. Yet, it also means that Australia is not a non-nuclear country any more.

In brief, the deal itself and the triple alliance among AUKUS will take some years to become a real threat to China or the ruling authorities of the country. But the deal announced on Sept. 15 will complicate Chinese efforts to maintain a peaceful rise and act a responsible power. Furthermore, the deal and the rationales behind it is sure to impede China’s good-will to the members of AUKUS and the Quad, not mention of their irresponsible effects on peace and prosperity in the Asia-Pacific region.

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Was Trump better for the world than Biden, after all?

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Joe Biden
Official White House Photo by Adam Schultz

Joe Biden and the State Department just approved a major deal with the Saudis for 500mln in choppers maintanance. Effectively, the US sold its soul to the Saudis again after the US intelligence services confirmed months ago that the Saudi Prince is responsible for the brutal killing of journalist Jamal Khashoggi. The Biden administration is already much more inhumane and much worse than Trump. Biden doesn’t care about the thousands of American citizens that he left behind at the mercy of the Taliban, the Biden administration kills innocent civilians in drone strikes, they are in bed with the worst of the worsts human right violators calling them friendly nations. 

Biden dropped and humiliated France managing to do what no US President has ever accomplished —  make France pull out its Ambassador to the US, and all this only to go bother China actively seeking the next big war. Trump’s blunders were never this big. And this is just the beginning. There is nothing good in store for America and the world with Biden. All the hope is quickly evaporating, as the world sees the actions behind the fake smile and what’s behind the seemingly right and restrained rhetoric on the surface. It’s the actions that matter. Trump talked tough talk for which he got a lot of criticism and rarely resorted to military action. Biden is the opposite: he says all the right things but the actions behind are inhumane and destructive. It makes you wonder if Trump wasn’t actually better for the world.

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