Clueless and immoral

TO UNDERSTAND how far South Africa has strayed from Nelson Mandela’s legacy, one need only peruse the latest foreign-policy paper drafted by grandees of the ruling African National Congress (ANC). The fall of the Berlin Wall, it reads, marked not the freeing of captive nations in Europe but a regrettable triumph of Western imperialism. The pro-democracy protests in Tiananmen Square in China were an American-backed counter-revolution. Russia’s invasion of eastern Ukraine is a conflict “directed from Washington”. America’s policies in Africa and the Middle East have “the sole intention” of toppling democratic governments. As “part of the international revolutionary movement to liberate humanity from the bondage of imperialism”, South Africa should seek to have American military bases thrown out of Africa.

If this were a spoof, it might be amusing. Yet the document is entirely serious: its contents are to be debated at the ANC’s policy conference in October. Its authors include several serving and retired cabinet ministers, including a former foreign minister. South Africa risks becoming a laughing-stock, not least in Africa itself.

When...

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Costly cash

SUPPOSE there were a way of getting money to some of the world’s poorest people precisely when they need it. Suppose, too, that the flow hardly ever diminished, even during a global financial crisis. Finally, suppose the cash could not be creamed off by corrupt local officials. Surely every right-minded government in the world would want to encourage this and make it as cheap and easy as possible?

Alas, no. Remittances, the packets of money sent home by migrant workers from India, the Philippines and elsewhere, are individually tiny but collectively enormous. The World Bank estimates that flows to developing countries will be worth $440 billion this year—more than twice as much as foreign aid. And that is just the payments the bank can track.

The money earned from feeding toddlers, sweeping floors or writing code in richer countries brings all sorts of benefits when it returns home (see article). It eases poverty and boosts consumption. When poor families begin to receive remittances, they tend to yank their children out of menial jobs and send them to...

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Merkel the bold

ANGELA MERKEL may be the most powerful politician in Europe, but she has rarely shown much inclination for bold leadership. Both in domestic politics and, especially, during the euro crisis, the German chancellor’s style has been one of cautious incrementalism. She has eschewed sweeping visions, put off decisions whenever possible and usually reflected, rather than shaped, public opinion. The European Union has paid a heavy price for her small-bore instincts, not least because they made the euro-zone crisis deeper and more protracted than it needed to be.

Against that background, Mrs Merkel’s approach to Europe’s migrant crisis is remarkable. As throngs of Africans and Arabs turn Italian and Greek islands, and eastern European railway stations, into refugee camps (and are found dead in Austrian lorries), the chancellor has taken a brave stand. She has denounced xenophobes, signalled Germany’s readiness to take more Syrian refugees and set out a European solution to a politically explosive problem.

On August 31st Mrs Merkel issued a dramatic call to arms, warning that today’s refugee misery will have graver consequences for the future...

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Trump’s America

“THIS country is a hellhole. We are going down fast,” says Donald Trump. “We can’t do anything right. We’re a laughing-stock all over the world. The American dream is dead.” It is a dismal prospect, but fear not: a solution is at hand. “I went to the Wharton School of Business. I’m, like, a really smart person,” says Mr Trump. “It’s very possible”, he once boasted, “that I could be the first presidential candidate to run and make money on it.”

When Mr Trump first announced that he was running for president, he was dismissed as a joke. A wheeler-dealer with lots of experience of reality TV but none whatsoever of elective office wants to be commander-in-chief? Surely, sophisticates scoffed, no one could want this erratic tycoon’s fingers anywhere near the nuclear button. But for weeks now he has led the polls for the Republican nomination, despite saying things that would have torpedoed any normal campaign. Americans are waking up to the possibility that a man whose hobby is naming things after himself might—conceivably—be the nominee of the party of Lincoln and Reagan. It is worth spelling out why that would be a terrible thing. Fortunately, the...

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All fall down

PLENTY of countries run deficits. And when recessions occur, loosening the public purse strings makes sense for many of them. But Brazil is not most countries. Its economy is in deep trouble and its fiscal credibility is crumbling fast.

The end of the global commodity boom and a confidence-sapping corruption scandal, after years of economic mismanagement, have extinguished growth. Brazil’s GDP is expected to contract by 2.3% this year. Fast-rising joblessness, together with falling real private-sector pay and weak consumption, are squeezing tax receipts. Meanwhile rising inflation, allied to a free-falling currency, means investors demand higher returns on government debt. The result is a budgetary disaster. This year a planned primary surplus (ie, before interest payments) has vanished. Once interest payments are included, the total deficit this year is projected to be 8-9% of GDP.

Faced with the prospect of public finances slipping out of control, Brazil’s policymakers have stuck their heads in the sand. The 2016 draft budget sent to Congress this week by the president, Dilma Rousseff, builds in a primary...

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It’ll cost you

GETTING divorced? Going to the doctor? Flushing a loo? If so, you are increasingly likely to receive a bill from the government. As cash-strapped Western countries try to balance their books without raising unpopular taxes, they are charging higher fees for everyday services. American cities tap their residents for around a quarter more in such charges than they did at the turn of the century. Half the countries in the EU have increased health-care charges since the financial crisis. In Britain, where a severe fiscal squeeze is under way, new fees are popping up in unexpected places, from the criminal courts to municipal pest-control agencies (see article).

Pay-as-you-go government has advantages. Charging for services helps allocate resources efficiently, deterring overconsumption, just as parking meters stop people hogging spaces. And far from being uniformly regressive, fees can be fairer than general taxation. Selling water by the litre, as Ireland controversially began to do in...

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Lots of heat but not much light

THE intensity of the argument in Washington, DC, over the nuclear pact between Iran, America and five other powers is in some ways impressive. Such an important agreement merits close scrutiny. Sadly, much of the talk has been wildly misleading (see article). For example, Ted Cruz, a Republican presidential hopeful, says the deal would make the Obama administration “the leading global financier” of Islamic terrorism, “sending billions to jihadists who will use that money to murder Americans”. Some critics seem motivated more by loathing of Barack Obama than by the flaws of the accord itself. Yet the White House has hardly been blameless, either. Mr Obama’s insistence that rejection of the pact would put America on a path towards war with Iran is cynically calculated to play on voters’ fears.

The fate of the deal will be decided over the next five or six weeks. Given Republicans’ hostility, Mr Obama knows that he will probably have to use his presidential veto following a first vote in...

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Let them in and let them earn

ISLAMIC STATE (IS) does not hide its brutality. When it burns men alive or impales their heads on spikes, it posts the videos online. When its fighters enslave and rape infidel girls, they boast that they are doing God’s will. So when fugitives from IS-occupied Syria or Iraq say they are frightened to return home, there is a good chance they are telling the truth.

The European Union is one of the richest, most peaceful regions on Earth, and its citizens like to think that they set the standard for compassion. All EU nations accept that they have a legal duty to grant safe harbour to those with a “well-founded” fear of persecution. Yet the recent surge of asylum-seekers has tested Europe’s commitment to its ideals, to put it mildly (see article). Neo-Nazi thugs in Germany have torched asylum-seekers’ hostels. An anti-immigrant group is now the most popular political party in Sweden. Hungary’s prime minister, channelling his inner Donald Trump, warns that illegal migrants,...

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Awaiting its iPhone moment

IS IT vividly realistic—or is it still just vapid razzmatazz? Virtual reality (VR), a technology that flopped in the 1990s, is making a glitzy comeback. The dream of a headset that can immerse you in a detailed, realistic 3D world is now being pursued in earnest by a gaggle of startups and the giants of technology alike. Last year Facebook bought Oculus, the most prominent VR fledgling, for $2 billion. Mark Zuckerberg, Facebook’s boss, says “immersive 3D content is the obvious next thing after video.” Google supports VR in several of its products and is backing a secretive new company called Magic Leap. Microsoft, having missed the boat on smartphones, has developed an impressive VR system named HoloLens. Tech leaders have decided that VR could be the next big thing after the smartphone (see article). Are they right?

The VR devices appearing in the next few months will focus on video-gaming, where VR is a natural fit. But the technology will eventually have many other uses: in data visualisation...

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The Great Fall of China

ONCE the soundtrack to a financial meltdown was the yelling of traders on the floor of a financial exchange. Now it is more likely to be the wordless hum of servers in data centres, as algorithms try to match buyers with sellers. But every big sell-off is gripped by the same rampant, visceral fear. The urge to sell overwhelms the advice to stand firm. 

Stomachs are churning again after China’s stockmarket endured its biggest one-day fall since 2007; even Chinese state media called August 24th “Black Monday”. From the rand to the ringgit, emerging-market currencies slumped. Commodity prices fell into territory not seen since 1999. The contagion infected Western markets, too. Germany’s DAX index fell to more than 20% below its peak. American stocks whipsawed: General Electric was at one point down by more than 20%.

Rich-world markets have regained some of their poise. But three fears remain: that China’s economy is in deep trouble; that emerging markets are vulnerable to a full-blown crisis; and that the long rally in rich-world markets is over. Some aspects of these worries are overplayed and others are misplaced. Even so, this...

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The resistible rise of Jeremy Corbyn

THE opposition Labour Party is about to inflict grave damage on Britain. If it picks Jeremy Corbyn, a veteran far-left MP, as leader on September 12th, Labour will consign itself to the wilderness. Worse, by wrecking opposition to the governing Tories, Mr Corbyn will leave Britain open to bad government.

The sudden vogue for populist leftists like Mr Corbyn echoes the earlier rise of parties such as Syriza in Greece and Podemos in Spain. Similar enthused crowds have been greeting another grizzled old socialist, Bernie Sanders, in America (see Lexington). All of them have energised new, mainly young supporters who fret about globalisation and inequality.

Yet even in such dubious company Mr Corbyn stands out as a throwback. For him no policy is too dog-eared, no intellectual dead-end too futile. Public spending? Yes, please. Higher taxes? Soak the capitalists and the landlords. State ownership? Nationalise the railways and utilities, get the private sector out of public services and...

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Better ways to pay for college

HARD as it may be to believe with Donald Trump hogging the headlines, America’s presidential primary campaigns are proposing serious ideas for how to deal with real economic problems. High among them is how to fix the country’s broken system of university finance. Hillary Clinton has come up with intriguing plans, but the ideas of Marco Rubio are the more radical. And radicalism is what the system badly needs.

America is home to the world’s best universities. But taken as a whole, its higher-education system is marred by soaring costs, stratospheric student debt and patchy performance. Tuition fees have doubled in real terms in the past 20 years. Student debt has trebled in the past decade, to $1.2 trillion. A recent study of academic achievement at college found that 45% of America’s students made no discernible academic progress in their first two years. Sorting out this mess demands three things: reforms that bear down on costs, that encourage students to make more informed choices about their future and that match repayments to borrowers’ ability to pay.

Mrs Clinton’s plan meets the third of those aims, and nods at...

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Pummelling the little platoons

EARLIER this year the Chinese government arrested five women who were campaigning against sexual harassment on buses. This was not because China’s leaders believe that groping is a good thing, or that it is acceptable if perpetrated on public transport. It was because the Communist Party is wary of any organisation it does not control. The five feminists were entirely peaceful, and they were not advocating anything subversive like democracy. But they were organised and demonstrating in public, and that made them seem dangerous. After a month in detention they were released on bail, but they remain under police surveillance and could still be hauled back to face elastic charges such as “picking quarrels and provoking trouble”. Such are the hazards of working for a non-governmental organisation (NGO) in China.

Now the party proposes to squeeze NGOs even harder, particularly those with foreign connections. A new draft law bars any Chinese NGO from receiving foreign funding (see article). It also sets...

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Editing humanity

THE genome is written in an alphabet of just four letters. Being able to read, study and compare DNA sequences for humans, and thousands of other species, has become routine. A new technology promises to make it possible to edit genetic information quickly and cheaply. This could correct terrible genetic defects that blight lives. It also heralds the distant prospect of parents building their children to order.

The technology is known as CRISPR-Cas9, or just CRISPR. It involves a piece of RNA, a chemical messenger, designed to target a section of DNA; and an enzyme, called a nuclease, that can snip unwanted genes out and paste new ones in. Other ways of editing DNA exist, but CRISPR holds the promise of doing so with unprecedented simplicity, speed and precision.

A dizzying range of applications has researchers turning to CRISPR to develop therapies for everything from Alzheimer’s to cancer to HIV (see article). By allowing doctors to put just the right cancer-hunting genes into a patient’s...

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An affair to remember

THE slogan of Ashley Madison, a website that arranges extramarital liaisons, is “Life is short. Have an affair.” Its home page shows a woman holding a finger to her lips. So much for promising to keep secrets. Last month a group of hackers called Impact Team stole the site’s user database and transaction history going back to 2007, and this week they released it online: more than 30m users’ names, addresses and personal details, along with GPS co-ordinates and sexual preferences. This trove of data is fiddly to download and search, but already users of the site are being outed, as journalists and activists comb through the records looking for celebrities, business leaders and politicians. A deluge of revelations seems likely in the coming days, as websites pop up that allow easy searching.

The hackers’ motives are unclear. In their statements they denounce the “fraud, deceit and stupidity” of both Ashley Madison’s parent company, Avid Life Media, and the site’s users. Their complaint against Avid Life is supposedly that the site is a scam, because the vast majority of its users are men, who have to buy credits to access its services. But...

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Inverted logic

IT IS the corporate equivalent of burning the American flag. A “tax inversion” is a manoeuvre in which a (usually American) firm acquires or merges with a foreign rival, then shifts its domicile abroad to reap tax benefits. A spate of such deals last year led Barack Obama to brand inversions as “unpatriotic”. The Treasury formulated rules to stamp out the practice.

That stemmed the flow of inversions for a while. Now a flurry of deals has put them back in the spotlight (see article). This month alone, Terex, a cranemaker, has announced a deal with Konecranes that will move its headquarters to Finland; and CF Industries, a fertiliser-maker, and Coca-Cola Enterprises, a bottler, have unveiled transactions in which they will redomicile in Britain. Policymakers are talking about making inversions even harder. The perverse consequence would be to make it more likely that taxes and jobs will leave America.

The boardroom case for inversions stems from America’s tax exceptionalism....

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Stuck in the middle

TURMOIL has become a commonplace of financial markets in recent summers. This one is no different. An unexpected devaluation of the yuan this week fuelled fears about the state of China’s economy, setting off falls in commodities and emerging-market currencies. Stockmarkets in Europe and America wobbled. Copper hit a six-year low; oil is below $50 a barrel; Malaysia’s currency is at its lowest level since the Asian crisis in 1998. Even Canada is flirting with recession.

No single factor can explain everything that is going on. But two countries, and the relationship between them, provide a framework for understanding these gyrations. America is still the world’s biggest economy and sets the tone for interest rates and currencies globally. China has been the fastest-growing big economy by a distance. These two behemoths are pulling in different directions. America’s recovery is gradually gathering pace, while China’s economy is slowing sharply. This divergence is causing trouble, particularly for those emerging markets which have lived the high life on China’s investment boom and on a flood of cheap credit from America. And there is...

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Rulers of time

NORTH KOREA will go back in time on August 15th, turning back its clocks by half an hour to establish its own time zone. It seems appropriate for a country that venerates its past: the hermit kingdom already has its own calendar, with years counted from 1912, the birth year of its founder and “eternal president”, Kim Il Sung. Its time-travelling is the latest example of a long tradition of expressing political power by adjusting clocks and calendars. Doing so alters a fundamental aspect of daily life, literally at a stroke. And what better illustration could there be of a ruler’s might than control over time itself?

Not all such changes stand the test of time: think of France’s failed attempt to introduce a ten-hour clock and an entirely new calendar after the revolution of 1789, to emphasise the break with its monarchist past, or the Soviet Union’s experiments with five- and six-day weeks during the 1930s. But those changes that do...

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Xi’s history lessons

IN EARLY September President Xi Jinping will take the salute at a huge military parade in Beijing. It will be his most visible assertion of authority since he came to power in 2012: his first public appearance at such a display of missiles, tanks and goose-stepping troops. Officially the event will be all about the past, commemorating the end of the second world war in 1945 and remembering the 15m Chinese people who died in one of its bloodiest chapters: the Japanese invasion and occupation of China of 1937-45.

It will be a reminder of the bravery of China’s soldiers and their crucial role in confronting Asia’s monstrously aggressive imperial power. And rightly so: Chinese sacrifices during that hellish period deserve much wider recognition. Between 1937, when total war erupted in China, and late 1941, when the attack on Pearl Harbor brought America into the fray, China fought the Japanese alone. By the end of the war it had lost more people—soldiers and civilians—than any other country bar the Soviet Union.

Yet next month’s parade is not just about remembrance; it is about the future, too. This is the first time that China is...

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A new chapter

THIS newspaper does not like to dwell on itself. We are proud of our heritage of editorial and commercial independence, serving no master save the liberal credo of open markets and individual freedom. But we publish no masthead listing our staff, no bylines for our journalists—and in our weekly edition no letter from the editor.

This week’s issue is an exception, because it is an exceptional moment in The Economist’s history. On August 12th we announced the most important change to our shareholding structure in almost 90 years. Pearson, the owner of the Financial Times, which has had a non-controlling 50% stake in us since 1928, is selling. Three-fifths of those shares will go to an existing shareholder—Exor, the holding company of the Agnelli family. The rest will be bought back by our parent company, The Economist Group.

A change in ownership is an important event for any newspaper, even ...

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