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Lancet study finds U.S. has, by far, the world’s most-overpriced medical care

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On September 1st, Gallup headlined “50% in U.S. Fear Bankruptcy Due to Major Health Event” and reported that last year only 45% did. Both percentages are the world’s highest. One of the world’s leading medical journals had just published a study which explains why it’s the case.

The medical journal, The Lancet, is one of the world’s Big Three scientific journals of medicine; that’s the triumvirate of authorities for physicians worldwide, and the other two are the Journal of the American Medical Association, and the New England Journal of Medicine. On August 27th The Lancet published “Measuring universal health coverage based on an index of effective coverage of health services in 204 countries and territories”. Here is the visual that’s in it, which shows the United States as having, by far, the world’s costliest medical care, at around $9,000 per person per year, and yet as having lower quality of health care than virtually all other industrialized nations do:

Here is another such study, showing the same thing, and calculating it more simply:

What explains this?

Quite simply, the United States is the world’s most corrupt nation, and medical care is such an extreme necessity when a citizen needs it, so that they’ll pay whatever the system charges them for it — and investing in healthcare products and services is therefore enormously profitable in the United States. Actually, the only other market-sector that competes with it for providing simultaneously high returns and low risk (the combination that offers the best of both worlds to investors) is consumer staples, such as foods, which likewise are necessities of life. When people are desperate, they’ll pay, whatever the cost, because these are things they don’t just want — they need. Here, from Maksim Papenkov’s award-winning 6 February 2020 paper, “An Empirical Asset Pricing Model Accommodating the Sector-Heterogeneity of Risk”, is his sector-specific calculation of stock-market profitability during 2000-2018, showing that “HC” Health Care, and “CS” Consumer Staples, were the best at combining low risk with high returns, during that 19-year period: 

(“CD” there is Consumer Discretionary and includes Automobiles and Hotels. It’s the only sector that has higher returns than Health Care, but those returns are twice as risky. The S&P500 have lower returns than Health Care and slightly higher riskiness. At the opposite end, “IT” Information Technology is both the riskiest and the least profitable; and “F” Financials are the second-worst sector for investors. The most-profitable sectors are the necessities, the sectors that take the most from the most-desperate.)

In May 2017, Axene Health Partners published their actuary, Chris Slaybaugh’s, study, “International Healthcare Systems: The US Versus the World”, which stated:

The United States is the only industrialized country in the world that does not have Universal Health Coverage for all citizens. … Rather than one system, United States citizens and residents are insured under a variety of sometimes overlapping systems. The United States is also the only developed country where a significant number of citizens are permitted to be uninsured and where a person’s employment can determine whether they have insurance and what insurance they have. … The extent to which medical bills contribute to bankruptcy is hard to tease out from other factors, but even those who are skeptical of the claim that medical costs cause the majority of bankruptcies concede that they are a significant contributor.13

In the rest of the developed world, by contrast, medical costs are rarely or never cited as a driver behind personal bankruptcy.

In fact, CNBC headlined on 11 February 2019, “This is the real reason most Americans file for bankruptcy” and reported that, 

Two-thirds of people who file for bankruptcy cite medical issues as a key contributor to their financial downfall.

While the high cost of health care has historically been a trigger for bankruptcy filings, the research shows that the implementation of the Affordable Care Act [“Obamacare”] has not improved things.

What most people do not realize, according to one researcher, is that their health insurance may not be enough to protect them.

While Barack Obama was running for President in 2008, he was promising to provide Americans with a “public option” in order to reduce profits for health insurance companies and thus lower costs, but he dropped that proposal immediately when he won the 2008 election, and he never pushed for it (not even to use as a bargaining chip with the Republicans in shaping his Obamacare). (In fact, Obama chose the conservative head of the Senate Finance Committee, Democratic Senator Max Baucus, to draft his Obamacare, because Baucus was against there being a public option, and because the progressive Democratic Senator Ted Kennedy’s Health, Education & Labor Committee had just drafted an Obamacare with a public option — Obama refused to have Kennedy draft his healthcare legislation. Obama was actually against there being a public option; only his public rhetoric was for it. Joe Biden is apparently now following the same tactic, of lying promises to the public, and true promises to his billionaire backers, to win the White House.) Obama promised the public “universal coverage”, which means 100% of the population covered, like in all other advanced economies, and his Obamacare increased the percentage insured from 84.5% when he came into office in 2009, to 87.7% two years after Obamacare started in 2013 — around 3%, by 2015 (which was after two years). That was still far short of the promised 100%. He was lying through his teeth in order to win election, and the ‘news’-media still hide (instead of expose) the fact that he did, and that he was actually an agent of the billionaires. He’s now the big hero among Democrats, because maybe Trump is even worse. Trump is up-front about his fascism. And Trump’s opponent now is another hypocrite (after Obama), Obama’s V.P., Joe Biden, who was the U.S. Senate’s leading Democratic Party segregationist and won his nomination by claiming to have been instead a civil-rights champion. Everything in U.S. politics is bait-and-switch. That’s the reality in America’s ‘democracy’: a bait-and-switch ‘democracy’, which serves actually only the wealthiest few. The politicians who are elected serve only the wealthy and well-connected.

America is the most libertarian, or “neo-liberal,” of the advanced industrial nations, and this is why it has the world’s most overpriced medical care. It provides the most liberty for the billionaires.

One of the few extremely bold Americans who rose high in the U.S. healthcare system and tried to tell the public how intensely corrupt it is, has been Marcia Angell, M.D, who held numerous prestigious posts in the U.S. medical system, and she was for a while the Editor-in-Chief of the New England Journal of Medicine. On 15 January 2009, Dr. Angell headlined “Drug Companies & Doctors: A Story of Corruption”, and wrote:

Conflicts of interest pervade medicine. … It is simply no longer possible to believe much of the clinical research that is published, or to rely on the judgment of trusted physicians or authoritative medical guidelines. I take no pleasure in this conclusion, which I reached slowly and reluctantly over my two decades as an editor of The New England Journal of Medicine. … So many reforms would be necessary to restore integrity to clinical research and medical practice that they cannot be summarized briefly. Many would involve congressional legislation and changes in the FDA, including its drug approval process. But there is clearly also a need for the medical profession to wean itself from industry money almost entirely. … Breaking the dependence of the medical profession on the pharmaceutical industry will take more than appointing committees and other gestures. It will take a sharp break from an extremely lucrative pattern of behavior. But if the medical profession does not put an end to this corruption voluntarily, it will lose the confidence of the public. … 

She had said, nine years earlier:

If we had set out to design the worst system that we could imagine, we couldn’t have imagined one as bad as we have. … Our health care system is based on the premise that health care is a commodity like VCRs or computers and that it should be distributed according to the ability to pay. … That market ideology is what has made the health care system so dreadful, so bad at what it does. … That is a fundamental mistake in the way this country, and only this country, looks at health care. … The only way to both reduce cost and increase access and quality is to change the system, to scrap it and start over. … I would pay for health care in a single payer system, and what goes into that pot can vary. In Germany, employers have to contribute to that pot. I don’t think that’s a good idea. I would rather see it come straight out of tax revenues.

Experts who are that public-spirited and knowledgeable about the system should be appointed by U.S. Presidents to lead the FDA and the Department of Health and Human Services, but the billionaires prevent that (of course).

On June 27th, NPR headlined “After Pushing Lies, Former Cigna Executive Praises Canada’s Health Care System”, and interviewed a retired PR executive for America’s health insurance companies, who said that maybe the work that he had done smearing Canada’s socialized health insurance — “to spread misinformation about Canada or use cherry-picked data and anecdotes” so as to deceive Americans to accept America’s existing medical system — was partly to blame for America’s having performed significantly worse than Canada had done on the coronavirus crisis. (As of 29 August 2020, Canada had 3,378 cases per million and was the 76th worst out of 215 countries, whereas U.S. had 18,522 cases per million and was the 9th-worst. On deaths, Canada was the 27th-worst at 241, whereas U.S. was the 11th-worst at 564.) 

America’s billionaires derive the vast majority of their net worth from stocks (capital gains and dividends), and from interest that’s paid to them; and, since nothing does this for them better than healthcare investments, the current for-profit system in health care is terrific for them; and these few hundred people, billionaires, extract this wealth from the hundreds of millions of Americans, the general public, and want to continue doing so, and they consequently finance politicians such as Joe Biden and Donald Trump (and their predecessors, such as Bush and Clinton), and they also set up ‘charitable’ foundations, and donate to medical schools, so as to inculcate this libertarian belief, not just into the public, but especially into the students and professors, who receive that trickle-down from them, as employees and future employees. While many in academe are against it, they’re not the ones who get advanced to the prestigious and high-paid positions. “He that pays the piper calls the tune.” It’s top-down (aristocracy), and it only pretends to be bottom-up (democracy). And, so, the corruption continues, and Americans die younger, and poorer, because of this aristocratically controlled system. It’s the American way. It’s the American system. Of corruption. Americans call it “capitalism.”

Of course, another area in which the U.S. Government is extraordinarily corrupt is its Military-Industrial Complex; and, on August 28th, a former top official of the NSA, Bill Binney, provided, online, an in-depth description of what he personally knows about that. His personal knowledge is enormous concerning within the Government itself, but not outside it — i.e., not regarding the corporations and billionaires who control the economic rewards system that the top public officials, who typically are agents of  the “Deep State” (the billionaires), are serving. However, what he says there is informative and highly reliable regarding the way that the Government’s bureaucracy itself functions, and he is extraordinarily honest about the intense corruption within the official Government. He makes clear that the U.S. Constitution is being systematically and routinely violated by top U.S. officials; so, the U.S. Government routinely violates the U.S. Constitution, in this ‘democracy’, where the system functions like clockwork, for the billionaires.

Author’s note: first posted at Strategic Culture

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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Indictment of Trump associate threatens UAE lobbying success

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This month’s indictment of a billionaire, one-time advisor and close associate of former US President Donald J. Trump, on charges of operating as an unregistered foreign agent in the United States for the United Arab Emirates highlights the successes and pitfalls of a high-stakes Emirati effort to influence US policy.

The indictment of businessman Thomas  J. Barrack, who maintained close ties to UAE Crown Prince Mohammed bin Zayed while serving as an influential advisor in 2016 to then-presidential candidate Trump and chair of Mr. Trump’s inauguration committee once he won the 2016 election, puts at risk the UAE’s relationship with the Biden administration.

It also threatens to reduce the UAE’s return on a massive investment in lobbying and public relations that made it a darling in Washington during the last four years.

A 2019 study concluded that Emirati clients hired 20 US lobbying firms to do their bidding at a cost of US$20 million, including US$600,000 in election campaign contributions — one of the largest, if not the largest expenditure by a single state on Washington lobbying and influence peddling.

The indictment further raises the question of why the Biden administration was willing to allow legal proceedings to put at risk its relationship with one of America’s closest allies in the Middle East, one that last year opened the door to recognition of Israel by Arab and Muslim-majority states.

The UAE lobbying effort sought to position the Emirates, and at its behest, Saudi Arabia under the leadership of Crown Prince Mohammed’s counterpart, Mohammed bin Salman, at the heart of US policy, ensure that Emirati and Saudi interests were protected, and shield the two autocrats from criticism of various of their policies and abuse of human rights.

Interestingly, UAE lobbying in the United States, in contrast to France and Austria, failed to persuade the Trump administration to embrace one of the Emirates’ core policy objectives: a US crackdown on political Islam with a focus on the Muslim Brotherhood. UAE Crown Prince Mohammed views political Islam and the Brotherhood that embraces the principle of elections as an existential threat to the survival of his regime.

In one instance cited in the indictment, Mr. Barrack’s two co-defendants, a UAE national resident in the United States, Rashid Al-Malik, and Matthew Grimes, a Barrack employee, discussed days after Mr. Trump’s inauguration the possibility of persuading the new administration to designate the Muslim Brotherhood as a designated foreign terrorist organization. “This will be a huge win. If we can list them. And they deserved to be,” Mr. Al-Malik texted Mr. Grimes on 23 January 2017.

The unsuccessful push for designating the Brotherhood came three months after Mr. Barrack identified the two Prince Mohammeds in an op-ed in Fortune magazine as members of a new generation of “brilliant young leaders.” The billionaire argued that “American foreign policy must persuade these bold visionaries to lean West rather than East… By supporting their anti-terrorism platforms abroad, America enhances its anti-terrorism policies at home.”

Mr. Barrack further sought to persuade America’s new policymakers, in line with Emirati thinking, that the threat posed by political Islam emanated not only from Iran’s clerical regime and its asymmetric defence and security policies but also from the Brotherhood and Tukey’s Islamist government. He echoed Emirati promotion of Saudi Arabia after the rise of Mohammed bin Salman as the most effective bulwark against political Islam.

“It is impossible for the US to move against any hostile Islamic group anywhere in the world without Saudi support…. The confused notion that Saudi Arabia is synonymous with radical Islam is falsely based on the Western notion that ‘one size fits all,’ Mr. Barrack asserted.

The Trump administration’s refusal to exempt the Brotherhood from its embrace of Emirati policy was the likely result of differences within both the US government and the Muslim world. Analysts suggest that some in the administration feared that designating the Brotherhood would empower the more rabidly Islamophobic elements in Mr. Trump’s support base.

Administration officials also recognized that the UAE, Saudi Arabia, and Egypt constituted a minority, albeit a powerful minority, in the Muslim world that was on the warpath against the Brotherhood.

Elsewhere, Brotherhood affiliates were part of the political structure by either participating in government or constituting part of the legal opposition in countries like Kuwait, Iraq, Yemen, Bahrain, Morocco, Jordan, and Indonesia.

The affiliates have at times supported US policies or worked closely with US allies like in the case of Yemen’s Al Islah that is aligned with Saudi-backed forces.

In contrast to UAE efforts to ensure that the Brotherhood is crushed at the risk of fueling Islamophobia, Nahdlatul Ulama, one of, if not the world’s largest Muslim organization which shares the Emirates’ rejection of political Islam and the Brotherhood, has opted to fight the Brotherhood’s local Indonesian affiliate politically within a democratic framework rather than by resorting to coercive tactics.

Nahdlatul Ulama prides itself on having significantly diminished the prospects of Indonesia’s Brotherhood affiliate, the Prosperous Justice Party (PKS), since the 2009 presidential election. The group at the time successfully drove a wedge between then-President Susilo Yudhoyono, and the PKS, his coalition partner since the 2004 election that brought him to power. In doing so, it persuaded Mr. Yudhoyono to reject a PKS candidate as vice president in the second term of his presidency.

Nahdlatul Ulama’s manoeuvring included the publication of a book asserting that the PKS had not shed its links to militancy. The party has since failed to win even half of its peak 38 seats in parliament garnered in the 2004 election.

“Publication of ‘The Illusion of an Islamic State: The Expansion of Transnational Islamist Movements to Indonesia’ had a considerable impact on domestic policy. It primarily contributed to neutralizing one candidate’s bid for vice president in the 2009 national election campaign, who had ties to the Muslim Brotherhood,” said militancy expert Magnus Ranstorp.

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Biden Revises US Sanctions Policy

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Official White House Photo by Adam Schultz

In the United States, a revision of the sanctions policy is in full swing. Joe Biden’s administration strives to make sanctions instruments more effective in achieving his political goals and, at the same time, reducing political and economic costs. The coordination of restrictive measures with allies is also seen as an important task. Biden is cautiously but consistently abandoning the sanctions paradigm that emerged during Donald Trump’s presidency.

The US sanctions policy under Trump was characterised by several elements. First, Washington applied them quite harshly. In all key areas (China, Iran, Russia, Venezuela, etc.), the United States used economic and financial restrictions without hesitation, and sometimes in unprecedented volumes. Of course, the Trump administration acted rationally and rigidity was not an end in itself. In a number of episodes, the American authorities acted prudently (for example, regarding sanctions on Russian sovereign debt in 2019). The Trump-led executives stifled excess Congressional enthusiasm for “draconian sanctions” against Russia and even some initiatives against China. However, the harshness of other measures sometimes shocked allies and opponents alike. These include the 6 April 2014 sanctions against a group of Russian businessmen and their assets, or bans on some Chinese telecommunications services in the United States, or sanctions blocking the International Criminal Court.

Second, Trump clearly ignored the views of US allies. The unilateral withdrawal from the nuclear deal with Iran in 2018 forced European businesses to leave Iran, resulting in losses. Even some of the nation’s closest allies were annoyed. Another irritant was the tenacity with which Trump (with Congressional backing) threw a wrench in the wheels of the Nord Stream 2 pipeline project. Despite the complicated relations between Moscow and the European Union, the latter defended the right to independently determine what was in its interests and what was not.

Third, concerns about sanctions have emerged among American business as well. Fears have grown in financial circles that the excessive use of sanctions will provoke the unnecessary politicisation of the global financial system. In the short term, a radical decline in the global role of the dollar is hardly possible. But political risks are forcing many governments to seriously consider it. Both rivals (Moscow and Beijing) and allies (Brussels) have begun to implement corresponding plans. Trade sanctions against China have affected a number of US companies in the telecommunications and high-tech sectors.

Finally, on some issues, the Trump administration has been inconsistent or simply made mistakes. For example, Trump enthusiastically criticised China for human rights violations, supporting relevant legislative initiatives. But at the same time, it almost closed its eyes to the events in Belarus in 2020. Congress was also extremely unhappy with the delay in the reaction on the “Navalny case” in Russia. As for mistakes, the past administration missed the moment for humanitarian exemptions for sanctions regimes in connection with the COVID-19 epidemic. Even cosmetic indulgences could have won points for US “soft power”. Instead, the US Treasury has published a list of pre-existing exceptions.

The preconditions for a revision of the sanctions policy arose even before Joe Biden came to power. First of all, a lot of analytical work was done by American think tanks—nongovernmental research centers. They provided a completely sober and unbiased analysis of bothха! achievements and mistakes. In addition, the US Government Accountability Office has done serious work; in 2019 it prepared two reports for Congress on the institutions of the American sanctions policy. However, Joe Biden’s victory in the presidential election significantly accelerated the revision of the sanctions instruments. Both the ideological preferences of the Democrats (for example, the emphasis on human rights) and the political experience of Biden himself played a role.

The new guidelines for the US sanctions policy can be summarised as follows. First, the development of targeted sanctions and a more serious analysis of their economic costs for American business, as well as business from allied and partner countries. Second, closer coordination with allies. Here, Biden has already sent a number of encouraging signals by introducing temporary sanctions exemptions on Nord Stream 2. Although a number of Russian organisations and ships were included in the US sanctions lists, Nord Stream 2 itself and its leadership were not affected. Third, we are talking about closer attention to the subject of human rights. Biden has already reacted with sanctions both to the “Navalny case” and to the situation in Belarus. Human rights will be an irritant in relations with China. Fourth, the administration is working towards overturning Trump’s most controversial decisions. The 2020 decrees on Chinese telecoms were cancelled, the decree on sanctions against the International Criminal Court was cancelled, the decree on Chinese military-industrial companies was modified; negotiations are also underway with Iran.

The US Treasury, one of the key US sanctions agencies, will also undergo personnel updates. Elisabeth Rosenberg, a prominent sanctions expert who previously worked at the Center for a New American Security, may take the post of Assistant Treasury Secretary. She will oversee the subject of sanctions. Thus, the principle of “revolving doors”, which is familiar to Americans, is being implemented, when the civil service is replenished with personnel from the expert community and business, and then “returns” them back.

At the same time, the revision of the sanctions policy by the new administration cannot be called a revolution. The institutional arrangement will remain unchanged. It is a combination of the functions of various departments—the Treasury, the Department of Trade, the Department of Justice, the State Department, etc. The experience of their interagency coordination has accumulated over the years. The system worked flawlessly both under Trump and under his predecessors. Rather, it will be about changing the political directives.

For Russia, the revision is unlikely to bring radical changes. A withdrawal from the carpet bombing of Russian business, such as the incident on 6 April 2018 hint that good news can be considered a possibility. However, the legal mechanisms of sanctions against Russia will continue to operate. The emphasis on human rights will lead to an increase in sanctions against government structures. Against this background, regular political crises are possible in relations between the two countries.

From our partner RIAC

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Sea Breeze 2021: U.S. is worryingly heading closer to conflict with Russia in the Black Sea

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On July 10th, the 2021 iteration of the joint military exercise, Sea Breeze, concluded in the Black Sea. This exercise, which began on June 28th was co-hosted by the Ukrainian Navy and the United States Navy’s Sixth Fleet. According to the U.S. Navy, the annual Exercise Sea Breeze consists of joint naval, land, and air trainings and operations centered around building increased shared capabilities in the Black Sea.

This year’s Sea Breeze included participation from 32 countries, including NATO members and other countries that border the Black Sea, making it the largest Sea Breeze exercise since its inception in 1997. All other countries bordering the Black Sea were included in participating in the joint drills, except Russia.

Russia’s exclusion from these exercises is not unsurprising, due to its current tensions with Ukraine and its historical relationship with NATO. However, it signals to Moscow and the rest of the world that the NATO views Russia as an opponent in a future conflict. At the opening ceremony of Sea Breeze 2021 in Odessa, it was made clear that the intention of the exercise was to prepare for future conflict in the region when the Defense Minister of Ukraine, reported that the drills “contain a powerful message – support of stability and peace in our region.”

These exercises and provocations do anything but bring peace and stability to the region. In fact, they draw the United States and NATO dangerously close to the brink of conflict with Russia.

Even though Sea Breeze 2021 has only recently concluded, it has already had a marked impact on tensions between NATO countries and Moscow. U.S. Navy Commander Daniel Marzluff recently explained that the Sea Breeze drills in the Black Sea are essential deterrents to Russian assertions in region. However, these drills have consisted of increasingly provocative maneuvers that ultimately provoke conflict in the region.

These drills have done anything but act as a deterrent for conflict in the Black Sea. In response to the Sea Breeze drills, Russia conducted its own drills in the Black Sea, including the simulation of firing advanced missile systems against enemy aircraft. As the Black Sea is of utmost importance to Russia’s trade and military stature, it follows that Russia would signal its displacement if it perceives its claims are being threatened.   

Sea Breeze followed another rise in tensions in the Black Sea, when just a week prior to the beginning of the exercise, a clash occurred between Russia and Britain. In response to the British destroyer ship, the HMS Defender, patrolling inside Crimean territorial waters, Russia claimed it fired warning shots and ordered two bombers to drop bombs in the path of the ship. When asked about the HMS Defender, Russian President Vladimir Putin described the ship’s actions as a “provocation” that was a “blatant violation” of the 1982 UN Convention on the Law of the Sea. Putin also went on to claim that Moscow believes U.S. reconnaissance aircraft were a part of the operation as well. Despite this, British Prime Minister Boris Johnson responded with a denial of any wrongdoing.

Russia’s actions to provocations by the United States-led Sea Breeze and interaction with the HMS Defender in the Black Sea signal its resolve to retaliate if it feels as its sovereignty and its territorial claim on Crimea is being impeded on. Despite Russia signaling its commitment to defending its territorial claims in the Black Sea, the United States still willingly took actions during Sea Breeze that would bring the United States closer to a clash with Russia.  

Provoking conflict in the Black Sea does not align with the national security interests of the United States. In fact, it only puts the United States in the position to be involved in a costly clash that only would harm its diplomatic relationships.  

As Russia has signaled its commitment to its resolve and scope of its military response in a possible conflict, any potential conflict in the Black Sea would be costly for the United States. Over the past few years, Russia has increased the size and capabilities of its fleet in the Black Sea. Two of these improvements would especially pose a challenging threat to the U.S. and NATO – Russia’s drastically improved anti-access/area-denial capabilities and its new Tsirkon hypersonic cruise missile. This would mean any conflict in the Black Sea would not be a quick and decisive victory for U.S. and NATO forces, and would instead likely become costly and extensive.  

A conflict with Russia in the Black Sea would not only be costly for the U.S. and its allies in the region, but could irreparably damage its fragile, but strategically valuable relationship with Russia. If the United States continues to escalate tensions in the Black Sea, it risks closing the limited window for bilateral cooperation with Russia that was opened through increased willingness to collaborate on areas of common interests, as evidenced by the recent summit that took place in Geneva. After a period of the highest levels of tension between the U.S. and Russia since the Cold War, this progress made towards improving bilateral relations must not be taken for granted. Even if the U.S. and NATO’s maneuvers in the Black Sea do not ultimately materialize into a full-scale conflict with Russia, they will most likely damage not just recent diplomatic momentum, but future opportunities for a relationship between the two powers.

In such a critical time for the relationship between the United States and Russia, it is counterproductive for the United States to take actions that it can predict will drive Russia even further away. Entering into a conflict with Russia in the Black Sea would not only engage the U.S. in a costly conflict but would damage its security and diplomatic interests.  

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