On the blink

By failing to face up to its difficulties, the European Union only makes them worse

Seventy years ago this month Robert Schuman, the French foreign minister, proposed a European “coal and steel community”.

Somehow, the eu muddled through. The pandemic in Europe is fast becoming a political and constitutional crisis. This is solvable in principle, but the eu’s members cannot agree on what is needed to make their union more resilient, nor on how to bring about reform.

Instead the pandemic is testing the bonds of membership,

• One example is the single market. This is governed by strict rules limiting subsidies, but they have been suspended as governments pour €2trn ($2.2trn) into saving businesses from collapse.
• Another example is the single currency. As countries cushion the effects of lockdowns, their debts are rising sharply.
• A third example is the status of eu law. The euis built on law. If the stresses of the pandemic weaken the ecj’s foundations, the entire union will shake.

All these problems can be solved with vision, compromise and reform. But such sentiments crumble before countries’ different views of what the eu should be for. Even before the first death from covid-19, they struggled to forge common policies on defence, Russia, migration and much more besides.

Ominously, the mechanism of reform is also broken. Leaders have not dared to put through a significant amendment since 2007.

If the eu is to thrive, it will have to be a lot more ambitious than the northerners admit. Successful treaty change entails a broader acknowledgment that different countries want different things from the union and that such a “multi-speed Europe” can be more resilient than today’s unmet aspirations.

So long as the eu remains a conduit for spreading crises, the risk of collapse will be high. Bigger transfers and significant debt mutualisation would be hard, but as a down payment to avert catastrophe and to set the eu on the path to stability, they would be worth it.

Words:

bumpy, beacon, exemplar, loggerheads, fortify, crumble, mutualise, ominously, one-off, stagnate, taboo, unmet, doomster, wobbly, conduit.

Goodbye globalisation - The world economy

A more nationalistic and self-sufficient era beckons. It won’t be richer—or safer

Even before the pandemic, globalisation was in trouble. Now it is reeling from its third bodyblow in a dozen years as lockdowns have sealed borders and disrupted commerce. As economies reopen, activity will recover, but don’t expect a quick return to a carefree world of unfettered movement and free trade.

Since January a new wave of disruption has spread westward from Asia. Factory, shop and office closures have caused demand to tumble and prevented suppliers from reaching customers.

The underlying anarchy of global governance is being exposed. Around the world, public opinion is shifting away from globalisation.

This is just the start. Although the flow of information is largely free outside China, the movement of people, goods and capital is not.

Trade will suffer as countries abandon the idea that firms and goods are treated equally regardless of where they come from. Governments and central banks are asking taxpayers to underwrite national firms through their stimulus packages. And the push to bring supply chains back home in the name of resilience is accelerating.

The flow of capital is also suffering, as longterm investment sinks.

Poorer countries will find it harder to catch up and, in the rich world, life will be more expensive and less free. Moreover, a fractured world will make solving global problems harder, including finding a vaccine and securing an economic recovery.

Wave goodbye to the greatest era of globalisation—and worry about what is going to take its place.

Words:

Sino-American trade war, reel, carefree, unfettered, lurch, enfeeble, autocratic, chauvinism, contempt, savage, anarchy, squabble, prestige, curtail, drum up, moot, underwrite, repatriate, venture-capital, domesticate, forfeit, fractured

First, do no harm - Escaping the lockdown

Governments pinning their hopes on contact-tracing apps should tread carefully

Medicine’s history is full of promising treatments that, when tested, turned out not to work or even to cause harm.

Many governments hope salvation can come sooner, with contact-tracing apps on smartphones.

Yet contact-tracing apps are also an untested medical invention. Inaccurate information can mislead health offcials and citizens in ways that can be as harmful as any failed drug:

• Coverage is one complication. Epidemiologists reckon that apps might be useful if around 60% of people use them.
• Accuracy is an issue, too. Yet the strength of the radio signals used to do this is affected by all sorts of things besides distance.
• That could make it hard to calibrate the system. Too sensitive, and you risk a deluge of “false positives”. Too forgiving, and genuine cases of viral transmission will go undetected.
• Moreover, the apps themselves might change behaviour: spur people to go out before it is safe; Privacy must be weighed against transparency.

The efforts of some governments have been complicated by Apple and Google. The firms have made privacy
a priority

In a pandemic, experimenting with novel public-health responses such as mass surveillance should be done carefully, in case it subsequently turns out to have nasty side-effects.

Words:
agonise, salvation, keep tabs, impede, deluge, homophobic invective, infuriate, surveillance, pills and potions.

Reopen and shut - Unemployment

Freezing labour markets for too long will cost too much and impede the recovery

Never before have governments erected safety-nets as generous as those they have created during the pandemic.

Yet governments need to prepare an exit strategy not just from lockdowns, but also from their emergency policies.

Yet it seems increasingly likely that economies will instead be permanently changed. Consumers may emerge from lockdown with new habits and fears about mixing, spending less on restaurants, cinemas and travel, and spending more on deliveries, home-improvement and video-streaming. Four in ten American jobs lost in the pandemic will not return, according to one estimate based on surveys, historical patterns and stockmarket signals.

In America roughly three-quarters of recipients of unemployment insurance are receiving more than they did in work. That blunts the incentive to seek new jobs.

Governments thus face a difficult balancing act: withdraw support too readily, and many people will suffer; withdraw it too late, and the economy will ossify.

Schemes should also encourage flexibility. Idled workers should be allowed to return to their companies part-time.

Finally, governments should help people find new jobs. That means boosting support for training, tearing down barriers to opportunity such as unnecessary licensing rules, and cutting payroll taxes to encourage hiring.

Words:
trebling, so claims, indispensable, avert, revive, subside, elbow-to-elbow, starve, entice, blunt, fend, ossify, lavish, forcibly, stand in the way, grease.

Water torture - Hydropower in Asia

China should tell its neighbours what it is doing on the rivers they share

They have built big dams on the Brahmaputra and the Mekong, which pass through several more countries on their way to the sea.

If the countries nearest the source suck up too much of the flow, or even simply stop silt flowing down or fish swimming up by building dams, the consequences in the lower reaches of the river can be grim: parched crops, collapsed fisheries, salty farmland.

Tension and recrimination have been the order of the day for China and its neighbours, alas:

• Last year, during a drought, the river ran so low that Cambodia had to turn off a big hydropower plant.
• Even when rainfall is normal, the altered flow and diminished siltation are causing saltwater to intrude into the Mekong delta, which is the bread-

China has long resisted any formal commitment to curb its construction of dams or to guarantee downstream countries a minimum allocation of water:

• The problem is not just that China gets huffy about anything that could be construed as foreign interference in its “internal affairs”.
• The country’s leaders are also mesmerised by big engineering projects and seldom show much concern for the people displaced or disadvantaged by them, even when the victims are their fellow citizens.

They could do plenty more to reassure their neighbours. Sharing data on water levels routinely, without interruption, would be a good start. By the same token, downstream countries would love to know when Chinese hydro- power plants plan to retain or discharge water, to allow farmers and fishermen in the lower reaches time to prepare.

Words:
cascade, slosh, twitchy, grim, parched, riparian, bicker, recrimination, tributary, contemplate, diminish, siltation, deplete, huffy, mesmerised, tantalising, fetish, alleviate, gratitude.

Free at last - France leaves lockdown

After eight weeks of confinement, France was supposed to resume work this week.

Much of the complexity of organising this is not unique to France.

One is the adversarial nature of labour relations, combined with the French state’s enduring
appetite for bureaucracy.
In preparing déconfinement, bosses report vastly more such consultations.

Furthermore, both company bosses and elected o!cials are criminally liable while in their jobs.

Still, many people are itching to go back to work.

Yet there is an underlying fearfulness, links to a “particular lack of trust in French society”
towards institutions, employers and government.

The balance between safety and prosperity is perilous.

Words:
estuary, hand gel, scrub, acquit, itch, anxiety, layoff, assuage.

The Swedish way - Controlling covid-19

Sweden shunned a hard lockdown. Was that wise?

Sweden chose this path because it looked at the longer term, Full lockdowns are stop-gap measures, and European governments rushed to put them in place without plans for what would replace them.

Swedes have been sensible.

On first glance, Sweden seems to have paid a heavy price for choosing less stringentmeasures to keep people apart. Even so, Sweden’s mortality rate has been much lower.

Time will tell whether Sweden chose a better strategy than other countries,

• because the costs of lockdowns—interms not only of economic damage but also harm to people’s mental health—are yet to be tallied.
• Stockholm will reach “herd immunity”, the 40-60% rate of infection needed to halt the spread of the coronavirus, by June. When European countries count deaths a year from now their figures will be similar, regardless of the measures taken and the numbers now. The economic damage in Sweden, however, may be smaller.

Words:

bleary-eyed, squint, stop-gap

Northern fights - Naval strategy

America and Britain mount a show of force in the Arctic

On May 1st a flotilla of two American destroyers, a nuclear submarine, a support ship and a long-range maritime-patrol aircraft, plus a British frigate, practised their sub-hunting skills in the Norwegian Sea.

The decision to dispatch destroyerswas a bold one. One aim was to show that covid- 19 has not blunted swords, Another was to assert freedom of navigation in the face of Russia’s imposition of rules on the Northern Sea Route (nsr).

More broadly, the Arctic is a growing factor in nato defence plans.

The main task of Russian subs is defensive: to protect a “bastion”. But nato admirals worry that, in a conflict, some might pose a wider threat to the alliance.

For much of the cold war, nato allies sought to bottle up the Soviet fleet in the Arctic by establishing a picket across the so-called giuk gap, But defence in depth may not su”ce.The challenge is a familiar one. ce. A new generation of Russian ship-based missiles, capable of striking nato ships or territory from far north of the giuk gap, represents “a dramatically new and challenging threat”, concludes the iiss.

Words:
blot out, snoop, beastliness, flotilla, destroyer, patrol, frigate, blunt, think-tank, bottle up, picket, bastion, lair.

The jobless market - Welfare and work

Unemployment is at levels last seen during the Great Depression.
The welfare system is creaking

Millions have found themselves in a similar position, pushing America’s unemployment rate to an 80-year high. As elsewhere, New York’s computer systems could not handle the rush of applications for unemployment insurance (UI).

So rapid a rise in unemployment would stress any country’s UI system. America’s long economic expansion left its system woefully underfunded. So although the weekly $600 top-up that Congress approved in late March is nominally generous, millions of people have not had their money.

UI is intended to replace a share of lost wages while a recipient looks for work. But overall, prepandemic America had perhaps the rich world’s stingiest system. The average payout in 2019 was equivalent to about 40% of previous earnings.

Now America may have the world’s most generous system. Goldman Sachs, a bank, estimates that three-quarters of laid-o! workers are in line to receive benefits that exceed their former wage.

Giving some workers more money than they had earned in a job may not be the best use of public resources, but the people who benefit most are likely to be among America’s poorest.

Regulations are designed to foil people who quit a job in order to pick up an unemployment cheque.

Some economists want the government to do more to encourage employers to reduce working hours rather than laying people off.

Another option would be to prolong the more generous unemployment system past July. But at some point such payouts will hinder the economic recovery.

Most probably, the unemployment system will return to its pre-pandemic ways sooner rather than later. The economy is reopening and bosses are looking for workers.

Words:

woefully, nomimally, loom, stingy, hefty, archaic, fiscal, foil

Craics in the business model - Irish pubs

NEW YORK
Surviving covid could be harder than surviving Prohibition

On the eve of one of the most profitable weeks of the pub year, in an attempt to stop covid-19 from spreading, City Hall closed down Irish pubs, along with other bars and restaurants. Some will never reopen.

Even before the lockdown, the structural problems causing the decline of the Irish pub were already in place. Increases in rents and the minimum wage were eating into profits. And drinking habits have changed.

Some neighbourhood bars have a chance of surviving the lockdown. It helps that they often own the building. They have lower overheads than those catering to tourists and the corporate-worker crowd. Their customers tend to be regulars. But it won’t be easy.

Still, many owners are confident that customers will be back. Mr Dolan thinks it will be impossible to stop young people socialising.

Historically, the Irish pub was the place where business was done, jobs were found and favours were traded, a very important social function.

Words:

boozy, overtly, coveted, catering, bustling, rejig.

Mike Pompeo’s followership

The secretary of state is confusing global leadership with barking for his master

For a man acknowledged to be highly intelligent, Mike Pompeo has a long history of talking nonsense. His recent insistence that covid- 19 probably emerged from a Chinese laboratory—a conclusion American spies appear not to share—was of this pattern.

Hardly anyone else outside the Republican base seems to have taken his allegation all that seriously. The other half of America discounted it on the basis that Mr Pompeo said it.

His China-baiting, an obvious effort to distract from Mr Trump’s struggles with the pandemic, was a case in point.

Two particular reasons seem to explain Mr Pompeo’s flexibility.

One is personal. Yet his subsequent climb is mainly due to Mr Trump’s need for fresh faces for an administration that many Republicans were unwilling to join or, because of past criticism of the president, unwelcome in. No one in the administration owes Mr Trump more than he does.

The other explanation is that Mr Pompeo represents a broader politicisation of foreign policy. Yet it has accelerated under Mr Trump, in part because blaming the other side is the easiest way for establishment Republicans to justify his protectionism and other o”ences against conservative orthodoxy.

He will be remembered for undercutting the world’s reasonable case against China’s handling of the virus by throwing mud for his boss in the midst of a pandemic. That is not American leadership.

Words:

complicit, evangelical, allegation, mediocrity, articulation, sceptically, grudge, tsar, nonentity, harangue, annexation, capitulation, hasty, nuanced, bullish, baiting, abhor, seepage, partisanship, orthodoxy.