Month two

Big protests in Paris are Emmanuel Macron’s severest test yet

Putin couldn’t pass pension reform. Can France’s president do better?

The boulevards of the French capital were filled once again this week with banners and balloons, demonstrators, riot police and tear gas.

A transport strike against pension reform, which began on December 5th and continued throughout the Christmas holidays, has now entered its second month. This week lawyers, teachers, hospital workers and others joined the protests.

Railway workers have now been on strike for longer than during the protests of 1995, which forced a previous government, under Alain Juppé, to shelve its own pension reform. On one day in December, more people took to the streets than at any other time under Emmanuel Macron’s presidency.

How and when this conflict ends matters not only to the commuters struggling daily to reach the capital from remote Paris suburbs. It will also be the measure by which to judge Mr Macron’s claim to be able, unlike his predecessors, to “transform” France.

The French mandatory-pension system, made up of 42 different regimes, consumes 14% of GDP, nearly twice the oecd average. Once in their armchairs, the French receive, on average, 60% of pre-retirement earnings, compared with 49% in the oecd as a whole. Thanks to long life expectancy (now 80 for men, 86 for women), they then spend roughly a quarter of a century in retirement.

Those on “special regimes” retire earlier even than the legal minimum age of 62. Train drivers can stop at 50, a legacy of coal-shovelling times. Because today’s pensions are paid by charges on today’s workers, the system needs constant tweaking.

By 2025, according to the official pensions advisory council, the overall pensions deficit will be somewhere between €8bn and €17bn ($8.9bn-$19.7bn).

With just two years left before the next presidential campaign, and having narrowly survived the gilets jaunes (yellow jackets) protests against costly fuel, Mr Macron might have chosen a mere technical fix. A 0.7-percentage-point increase in pension charges, for instance, would close the financing gap by 2025.

But Mr Macron campaigned for the presidency in 2017 on a more radical promise. He vowed to reshape the labour, training and welfare systems so as to encourage job creation, adapt France for a “post-salary” era, ease mobility and protect people rather than jobs.

To this end, Mr Macron vowed in his manifesto to merge the 42 regimes into a single points-based system, with the same rules for all. This will spell the end of the special regimes, which Mr Juppé did not dare to do 25 years ago, as well as even out calculation rules that favour public-sector workers.

The plan, unveiled last month by Edouard Philippe, the prime minister and a former aide to Mr Juppé, will also introduce a minimum monthly pension of €1,000. Those earning over €120,000 a year will pay mandatory charges at a lower rate above that level, but these will only finance others’ pensions, not their own. The head of the employers’ federation, Geoffroy Roux de Bézieux, calls the new system “very redistributive”.

This is not, however, the way the unions see it. The Confédération Générale du Travail (cgt), with its history of la lutte des classes (class struggle), rejects out of hand the proposed new points-based system. It accuses Mr Macron, “a president of the ultra-rich”, of destroying the pension system.

On strike from day one, the cgt refuses to go back to work until the government abandons its plans. This week its members invaded the Paris office of BlackRock, an American asset manager, insisting (wrongly) that the lower pension charges on high salaries are Mr Macron’s secret gift to private pension providers.

Talks between unions and the government resumed on January 7th. Mr Macron says that he has no intention of shelving his reform. So no compromise will satisfy the cgt. Instead the government hopes to reach a deal with the more moderate Confédération Française Démocratique du Travail (cfdt), now the country’s biggest union.

Its leader, Laurent Berger, backs a points-based system. But he has taken part in the strikes because of the new “pivot age” of 64. Introduced by Mr Philippe last month, the idea is to build incentives around this age, to encourage the French to stay at work longer.

Were the government to drop this, in order to split the unions, it would look like a concession too far. At some point, the French will have to accept the need to work longer, if they are not to leave younger generations with an intolerable financial burden. As it is, Mr Philippe has already given way spectacularly to demands from those on special regimes.

He has promised dancers at the Paris Opera, whose regime dates back to 1698, that the points system will affect only new recruits. Prison wardens, air-traffic controllers, pilots, policemen and firefighters have all been promised exceptions. Even train drivers have been told that the rules will apply only to those born after 1985. Teachers, who are poorly paid in France, have been promised more money.

It may be, however, the only basis for compromise with the cfdt. “Economically the pivot age doesn’t make sense,” says Ludovic Subran, chief economist at Allianz, an insurer. “Under a points-based system you leave it to individuals to decide when they have accrued enough to retire.” Much will depend on the momentum over the next week or so. A big turnout was expected for a one-day protest on January 9th.

But overall participation in the strike by railway workers fell from 32% on December 6th to 6% on January 3rd, and among train drivers from 87% to 31%.

Although most polls show people support the strikes, for the first time, one poll has shown the number falling below 50%.

Yet most of the French are also still against the proposed new system.

Poor communication, flourishing conspiracy theories and hostility to the perennially haughty Mr Macron mean that, even now, few believe his claim that he is trying to preserve France’s pension system rather than destroy it.

China is taking its ideological fight abroad

The goal is to impose a heavy price on anyone who opposes the Communist party’s power

Jamil Anderlini

web_Chinese global threats
© Ingram Pinn/Financial Times

Of the official announcements posted on the website of China’s embassy in Sweden over the past year, nearly two thirds are vituperative attacks on individual Swedish journalists, politicians and other public figures.

“Some people in Sweden shouldn’t expect to feel at ease after hurting the feelings of the Chinese people and the interests of the Chinese side,” was one typical, mildly threatening, outburst.

The embassy in Sweden has been the most aggressive exemplar of China’s new “wolf-style diplomacy” over the past year or so. But it is far from the only one.

The key to understanding this belligerence lies in the policies and priorities that make up “Xi Jinping thought”. In numerous speeches and official documents, the Chinese president describes a bitter struggle between “socialism with Chinese characteristics” and “western anti-China forces” with their “extremely malicious” ideas of freedom, democracy and human rights.

In the 1950s, Nikita Khrushchev famously said the Soviet Union would “bury” western capitalist democracies. Since 2013 Mr Xi has put it this way: “Capitalism is inevitably dying and socialism is inevitably winning . . . This is an irreversible general trend in the development of history.”

This is more a struggle to perpetuate authoritarian rule in China than a pure ideological campaign like that of the cold war and it is primarily being waged on Chinese soil. But the fight is increasingly being exported, too, as Beijing strives to make the world safe for Chinese autocracy.

The goal is to impose as heavy a price as possible on anyone, anywhere who opposes the party’s power or objectives. Western liberal democracies are the main targets.

This overseas push began because the Chinese diaspora, estimated at about 60m people, has grown so much in recent years and is viewed as a potential threat to continued party rule in China. The history of revolution often runs through diaspora communities like the ones that nurtured Vladimir Lenin in Switzerland, Sun Yat-sen in Japan and Deng Xiaoping and Ho Chi Minh in Paris. But attempts to boost China’s influence and control of global narratives goes far beyond public diplomacy and reaches well outside the diaspora.

In November, Australia’s main spy agency said it was investigating “disturbing” allegations that Beijing had tried to install an agent in Australia’s federal parliament. The agent was found dead soon after he reported the plan and police have been unable to determine his cause of death.

In next-door New Zealand, some of the biggest donors to the main political parties are China-based businessmen with close ties to the Communist party. Campaign finance legislation rushed through parliament last month has done little to close off the loopholes that allow this kind of influence-buying.

Astonishingly, a man who spent at least 15 years working for China’s military intelligence apparatus remains an elected member of parliament, even after admitting he was ordered by the party to conceal his past on his New Zealand immigration application.

Tiny New Zealand may seem like a strange target for Communist party infiltration, but the country is attractive to Beijing as the soft underbelly of the “five eyes” intelligence sharing arrangement with Australia, Canada, the UK and, most importantly, the US. A senior intelligence official from one of these countries described New Zealand to the FT as “on the edge of viability as a member” of the grouping, because of its “supine” attitude to China and its “compromised political system”.

China is New Zealand’s biggest export destination. Presumably out of fear Beijing would respond with economic sanctions, Jacinda Ardern, New Zealand’s prime minister, has gone out of her way to avoid even mentioning the topic of Chinese political interference.

Australia’s response has been far more robust. China has threatened economic consequences for Australia’s impudence, although these have mostly proven hollow.

Even as some in Canberra fretted over the poor state of the relationship last year, Australian shipments to China rose to a record high, accounting for nearly 40 per cent of all exports. Political embargoes are often ineffective as they tend to hurt importers as much as exporters by raising prices and disrupting supply chains.

There are justified concerns in some countries about a rise in xenophobia and “reds under the bed” targeting of anyone who is ethnically Chinese. The world must guard against such racism, not least because it would be deeply perverse to punish the very people who have moved to western democracies to get away from a repressive system.

But ignoring China’s bullying behaviour would be an equally egregious form of racism towards ethnically Chinese compatriots since they are the primary targets of Beijing’s intimidation and overseas influence operations.

It would also be foolish. As the recently retired head of Australia’s main spy agency said in November, the Communist party has been very skilful at exploiting the openness of western democratic systems. The “effects might not present for decades and by that time it’s too late”, he said.

“You wake up one day and find decisions made in our country that are not in the interests of our country.”

Davos business leaders discover the value of workers

Talk of putting stakeholders first ignores mistrust among employees

Andrew Edgecliffe-Johnson

web_Davos stakeholder capitalism
© Ingram Pinn/Financial Times

Workers of the world, good news! You have been rebranded as “stakeholders” and your bosses have signed public letters saying that you now matter every bit as much to them as the shareholders on whose returns their bonuses are calculated.

If you had any lingering suspicions that the people who have staked more money than you will ever hold might still have the upper hand, let Davos 2020 dispel them. The theme of the World Economic Forum’s 50th annual meeting, taking place in the sparkling Alpine village this week, is “stakeholders for a cohesive and sustainable world”.

The executives in suits and snow boots will save all talk of buybacks and tax efficiencies until the next earnings call: this week is about a healthier planet, happier customers — and you.

On conference stages, in hotel meeting rooms and at pop-up hospitality venues on the Promenade, business leaders are busy discussing how to make work more inclusive, soothe politicians’ concerns about the gig economy and “upskill” you for whatever career curveballs the robots and artificial intelligence throw your way.

Five months after the Business Roundtable in Washington threw its weight behind an already-emerging shift in corporate priorities — away from equity holders and towards employees, consumers, suppliers, local communities and the environment — this is one item on the stakeholder capitalism agenda the upper echelons are rapidly embracing.

Two years ago, a Deloitte survey found just 12 per cent of top global executives thought they could play much of a role in educating and training their staff. Sharon Thorne, Deloitte’s global chair, says this year’s poll found more than 80 per cent claim to be creating a culture of life-long learning.

The only problem is that their staff don’t trust them to do so. Another survey, conducted across 28 countries by the PR company Edelman, found that less than one-third of people trust employers to retrain workers — or pay decent wages. Yet 83 per cent are worried about losing their jobs as companies turn to freelancers, automation or cheap foreign competition to boost shareholder returns.

“There is a ‘trust but verify’ mood among employees, who are saying ‘show me the training and show me the money’,” says Richard Edelman, the firm’s chief executive.

Showing employees more money sounds like one of the purpose/profit trade-offs that risk getting a CEO fired by the shareholders who still wield that power. Yet at private events in Davos this week, several executives insisted social pressure to pay a living wage and the rising cost of buying in new skills in a tight labour market were changing their calculations about such investments.

Companies including Walmart and JPMorgan Chase have launched splashy reskilling initiatives as more businesses conclude they cannot rely on governments to provide workforces with the training they need. Such investments should generate a more lasting return than any share buyback. But so, too, will more modest investments in listening to what employees say about how companies measure up to their rhetoric.

Dan Schulman, CEO of PayPal, gave an example of what can be done on this front last year.

Having participated in previous Davos discussions about financial inclusion, he decided to find out more about the finances of his own hourly workers and call centre employees. He was shocked to discover that 60 per cent were struggling to make ends meet each month.

PayPal responded by raising wages, cutting the costs of health insurance, giving shares to all employees and offering them financial education. The moves came at an upfront cost, but Mr Schulman is confident that putting employees first will ultimately benefit his other stakeholders.

As the late Herb Kelleher, founder of Southwest Airlines, once put it: “A motivated employee treats the customer well . . . It’s not one of the enduring green mysteries of all time.”

Numerous studies show few things build consumers’ trust in business like treating employees decently. That should reassure investors that this change of focus can benefit them, too, over time. Business leaders who have been told they must treat a multiplicity of constituents as the equals of shareholders can struggle to set priorities.

But employees are those whose future they can most easily improve. Debates about inclusion and improving social mobility at events such as Davos can feel abstract, but paying your employees a living wage and convincing them that you are listening to them is not.

Yet too many at the top seem incurious about the realities of life for people lower down their org charts. YPO, a global network of 28,000 CEOs, found this month that less than 40 per cent of its members had ever measured employee trust within their businesses.

As they recalibrate their priorities, the executives in Davos need to reflect on whether they are putting as much effort into hearing their employees’ voices as they are into engaging with investors.

Then, after setting the world to rights this week, they can start turning their stakeholder pledges into action much closer to home.

Eurozone bankers launch fresh push against negative rates

Executives urge tax cuts and increased spending as favoured path to economic growth

David Crow in Davos

© FT montage

Eurozone bank executives have launched a fresh lobbying push to convince policymakers of the dangers of long-term negative interest rates, warning they will hurt savers and pensioners while fuelling price bubbles in riskier assets.

Bank chief executives have spent the past two years trying to force the European Central Bank to reverse its negative interest rates, which were first introduced in 2014. Other European central banks including Switzerland and Denmark also have negative rates.

Rates below zero have slashed the amount that the region’s lenders earn from bread-and-butter lending and crushed their profit margins.

But bankers’ entreaties have fallen on deaf ears, with policymakers concluding that the benefit to the eurozone economy outweighs the pain for lenders. One of Mario Draghi’s parting acts before standing down as ECB president last autumn was to tell banks to stop “being angry” about negative rates and instead focus on fixing their flawed business models.

Now European bankers are taking a different approach. In a series of private meetings with the region’s regulators and politicians at the World Economic Forum in Davos, bankers have warned of what they see as the broader perils of long-term negative interest rates, according to several people briefed on the discussions.

They pointed to data showing the impact of ultra-loose monetary policy is petering out and urged policymakers to cut taxes and increase spending to boost economic growth.

Ana Botin, executive chairman of Santander, the Spanish bank, praised Mr Draghi for “saving” the euro but said: “From here onwards it is critical to look at data and behaviours.”

“It seems in many [eurozone] countries the pros of negative rates don’t outweigh the cons,” Ms Botin said in an interview with the Financial Times. “People are not taking out more loans, and savers are understandably getting more worried about how they’re going to plan for the future.”

Ralph Hamers, chief executive of ING, the Netherlands-based bank, said that “no industry can live with raw materials that are more expensive than the price of finished goods”.

Mr Hamers also pointed to the impact on pensioners, some of whom are having to put more towards their retirement to offset the loss of income from bond yields — investments that have traditionally been used by fund managers to pay for future liabilities.

He added: “The industry is saying that [ultra-loose monetary policy] doesn’t work any more. It is so detrimental to savers’ confidence that it is having the reverse effect, and consumers are starting to save even more to make up for losses in their pensions.”

Two chief executives of large eurozone banks said they were also working on plans to pass the cost of negative rates on to a much larger chunk of retail savers, setting the stage for a political backlash that the banking industry hopes will lead to wider public awareness of the ECB’s policy.

So far the majority of banks have charged a fee only to corporate depositors and wealthy clients with balances over €1m, but the executives said this could be extended to all customers with more than €100,000, the limit for most deposit guarantee schemes in Europe.

Line chart of Central bank policy rates (%) showing The negative rates policy club

“The whole market is looking at this,” said one of the executives. “Over time, we need to decrease the threshold at which we charge.”

Thomas Jordan, head of the Swiss National Bank, on Thursday defended Switzerland’s five-year policy of negative interest rates and signalled a willingness to keep borrowing costs at minus 0.75 per cent or cut again if necessary. Switzerland needs negative interest rates, the central banker said on the sidelines of the Davos meeting.

But some bankers point to price bubbles in riskier assets such as equities and illiquid investments like private equity and privately held companies, which could tumble in value in the event of a recession.

“Fund managers . . . looking for yield have put their money to work into credit like commercial real estate and leveraged lending,” said Huw van Steenis, an executive at UBS and a former adviser to Mark Carney, the outgoing Bank of England governor.

David Solomon, chief executive of Goldman Sachs, cited the impact of negative rates in the eurozone and low rates in most other developed economies as a factor in the inflated, multibillion-dollar valuations that private companies such as WeWork have been able to attain.

“In an environment where for a long, sustainable period of time interest rates have been zero, and money has basically been free, it pushes people out [along] the risk curve,” he said. “One of the consequences of that is people chase growth, and people start to overvalue growth.”

Meanwhile, bank executives have also been lobbying politicians in countries with budget surpluses — most notably Germany — to loosen fiscal policy in the hope that more public spending and tax cuts will boost growth and inflation, paving the way for the ECB to start raising rates.

One chief executive involved in the effort said it was a “long game” designed to push policymakers to “reflate” the eurozone economy, noting that the ECB had “stopped listening” to complaints about bank profitability.

Jamie Dimon, the chief executive of JPMorgan, said he viewed negative rates with “trepidation”, describing them as “one of the great experiments of all time” and warning “we still don’t know the ultimate outcome”.

“I think it’s very hard for central banks to forever make up for bad policy elsewhere,” Mr Dimon said in an interview with CNBC. “That puts them in a trap. We’re a little bit in that trap today with rates so low around the world.”

Banks have also been supported in their effort by the US administration’s Davos delegation, which has also been urging European politicians to implement a fiscal stimulus.

Larry Kudlow, the White House’s top economic adviser, told a panel that Europe needed to cut taxes and regulation on business — in effect mimicking Donald Trump’s stimulus in the US — rather than keeping rates in negative territory.

“Negative rates are not a good idea, they are really bad for banks, and they are not good for savers,” Mr Kudlow told a panel this week, adding, jokingly, that Mr Trump disagreed with him because he would have benefited from ultra-low or negative rates when he was a real estate developer.

Additional reporting by Sarah Provan

Australia’s Infernal Denial

The greatest horror so far isn't the fires themselves—it's the response to them.

By Aaron Timms

It was in spring that the frightening laugh of the idiot arrived for Rimbaud. Australia’s own season in hell reached its pinnacle of stupidity a little later. Bushfires had broken out across the country’s eastern seaboard—where most of the population is clustered—in September. By October, still in the belly of the southern hemisphere’s spring season, fires to Sydney’s west and south blew out of control, and the cloak of a climate change–stained sky settled over the city.

Sitting in New York, I got regular updates from my brother, who relayed photos of Sydney’s ash-thick atmosphere and its effects on his otherwise robust physiology: the stinging eyes and burning lungs, the need to operate at half-speed in open air.

By the time I arrived back in Sydney, a few days before Christmas, the haze over the city had abated, but the smell of smoke as I exited the airport was both powerful and alarming—alarming because the climate had altered but people’s lives, apparently, had not.

Whether this displayed admirable human adaptability or meek acquiescence before an unconscionable new ecological reality, I couldn’t tell.

I grew up in Sydney and lived here for almost three decades before moving to the United States.

Nothing about this air, this fire season, was normal.

On the way out of the airport, I noticed an Australian flag flying at half-mast.

With a mawkishness that was only a little self-conscious, I took it as an omen for the country’s vital prospects.

In The Biggest Estate on Earth, his account of the sophisticated land-management systems indigenous Australians developed prior to the continent’s colonization by the British, historian Bill Gammage wrote about how Aborigines used fire “to shape the land. It was a major totem, a friend. Like songlines, fire unified Australia.”

Today fire has unified Australia once again but in shared suffering rather than as a tool for thecommon enjoyment of the land. In those first few days back, the stink of the country’s incinerating forests hit me every time I walked outside. The worst fires were hundreds of miles away. Death was in everyone’s nostrils.

To anyone still refusing to accept the connection between anthropogenic climate change and these unprecedented fires, the simple act of breathing offered a powerful rebuttal. But many in the nation’s conservative government remained unpersuaded—asif 2019 being the hottest and driest year on record had little to do with the readiness of the land to ignite.

On December 21, Michael McCormack, the acting prime minister, argued there was “a lot of hysteria about climate change” and that other factors were equally to blame for the bushfires: “There has been dry lightning strikes, there has been self-combusting piles of manure, there has been a lot of arsonists out there causing fire.” Self-combusting piles of manure: With that, Australia’s leaders called—quite literally—bullshit on the fires, and the curtain was raised on a two-week parade of political idiocy almost as monumental and catastrophic as the fires themselves. 

In the space of two weeks, Scott Morrison has laid out the emergency-response playbook for pat-earthers everywhere.

McCormack was acting as prime minister because the real prime minister, Scott Morrison, had skipped off on a family holiday to Hawaii just as the bushfires entered their most destructive phase. Canceling the holiday would have disappointed his daughters, Morrison explained; besides, his family had not enjoyed a vacation since May.

Meanwhile, vast swaths of the country’s southeast were going up in flames: While the prime minister was off doing shakas on the beaches of Hawaii, Australia endured its hottest day ever, with the average temperature across the entire continent, a land mass equivalent in size to the contiguous United States, reaching 41.9 degrees Celsius (107.4 degrees Fahrenheit). On his return, Morrison found a nation engulfed and a population enraged. His response was to carry on as if the fires were nothing out of the ordinary, a bit of summer heat like the heat of any other summer.

Among the many violent spectacles of this fire season—the thousands stranded on beaches and long stretches of country road stacked with torched cattle, the birds dropping dead in the middle of the day, the baby kangaroos immolated on farm fences, the fire tornadoes and bloody skies—perhaps the most hellish has been the march of the pyrocumulus clouds, the product of smoke plumes so big they can generate lightning that spreads fire even further. Just as these fires have created their own weather systems, so too Australia’s political leaders have created their own kind of reality to address the destruction.

First there was a studied prime ministerial silence. Then, on New Year’s Day, came a pantomime of normality: Morrison recorded a message in which he cheerily assured Australians that “we live in the most amazing country on earth.” Later that day, he hosted the cricket teams of Australia and New Zealand at his Sydney residence and posed, amid the smoke haze still choking the city, for a photo with the players.

Those fighting the fires, he said, would be “inspired by the great feats of our cricketers.” Children played in the background on grass turned as gray as a dead man’s teeth. By this point, the bushfires were so ferocious that many of them blew through containment lines built up through back-burning, forest-clearing, and other hazard-reduction methods: One firefighter witnessed a fire in an area that had burned only two weeks previously, but “the burnt leaves were burning again.”

The next day, when Morrison finally toured fire-devastated communities south of Sydney, the scale of the destruction—and the depth of people’s anger at him—was obvious. The most consistent message he heard from people on the front lines of the inferno that day was “Piss off.” Fronting the cameras after he’d run away from the heckles of one town’s inhabitants, Morrison looked genuinely bewildered. What I saw in his eyes was not sympathy or sadness but fear: fear at the full, murderous force of climate change and at the unvarnished fury of those left behind to battle it. Here was a man utterly unsuited to the challenge, with no idea what to do.

Within a day, that bewilderment was gone, replaced by a prime-ministerial horniness for the macho business of disaster recovery. First Morrison gave Australia what it really needed: an ad boasting of the government’s emergencyresponse. Next came some vague concessions to the idea that global warming was a factor in the fires, with the obligatory caveat that now was not the time to play politics.

Finally, the announcement of a 2 billion Australian dollar ($1.4 billion) bushfire recovery fund, with assistance from the Australian military. Morrison could present himself as the nation’s first responder in chief, a man of belated action, while avoiding the messy business of doing anything about the climate change that caused the fires. Short-term action has provided cover for long-term inaction.

Whatever it takes, whatever it costs, we will ensure the resilience and future of this country,” Morrison told the press earlier this week. Whatever it takes, that is, except the action most necessary: shifting Australia’s economy away from fossil fuels and providing global leadership on climate stabilization.

Denial, obfuscation, concession, inaction: In the space of two weeks, Scott Morrison has laid out the emergency-response playbook for pat-earthers everywhere. This is how we should expect conservatives to treat Patient Earth as the climate emergency worsens: as the site of successive wounds to be treated reactively and in isolation, rather than a sick organism in need of urgent, holistic preventive care. These isolated disaster-recovery efforts will continue until, guess what? It will be too late to do anything. And by then, the planet will be lost to us.

All the resources needed for a just transition to a low-carbon economy are staring Australia in the face. But so are the elements keeping the country inert, tied to a planet-wrecking prosperity.

I watched Australia burn from my parents’ house in leafy, untroubled inner Sydney, where I lay on my bed, each day, scrolling through never-ending social media catalogs of human and natural misery with the air conditioning turned down to 19 degrees C (66 degrees Fahrenheit). In this callous way, I contributed to the continuing emissions-borne destruction of the planet. On trips out of the house, I found myself getting pissy at friends, even my best and oldest ones, and becoming the type of too-good-for-it expat I’d always despised. Where was their rage? In the face of climate catastrophe, a smug liberal amiability reigned. A friend working in human rights told me he’d never heard of disillusioned intellectual historian Samuel Moyn or his social justice–oriented critique of the human rights movement.

Another friend, when I mentioned I was thinking of writing about EzraKlein’s forthcoming book on political polarization, questioned why I would ever “dunk” on Ezra, who “seems so nice” and has a “great podcast.” At a house party on New Year’s Eve, at which everyone seemed hungover and unhappy, someone told me that it would be wrong to cancel Sydney’s famous midnight fireworks, whatever the tastelessness of their spectacle in the middle of a national catastrophe, because “they contribute $100 million to the local economy.” Had people here always been this ignorant and unquestioning, or was I simply blinded in the past by affection for those close to me?

Contradiction and absurdity hauntmany countries in the climate change era, but each country has its own flavorof destructive denialism, and Australia is no exception. It’s long astonished and distressed me that a land with so much intelligence, energy, and wit—a place of such charm and easy charisma—could simultaneously be so unadventurous, self-satisfied, and lazy. Clive James, the Australian writer who recently died after a decades-long run as perhaps the English-speaking world’s sharpest and funniest critic, was also a climate change denier.

Paradoxes abound in Australia, especially when it comes to natural resources policy: The country is the largest net exporter of coal in the world but has massive reserves of lithium and solar energy potential, placing it among the prospective powerhouses of a global renewable energy future. Whatever the moral and ecological imperatives for climate change action in Australia today—and they are overwhelming—the economic case is also compelling. However good the country’s present is, the future could be so much better.

All the resources needed for a just transition to a low-carbon economy are staring Australia in the face. But so are the elements keeping the country inert, tied to a planet-wrecking prosperity: a conservative political establishment unconvinced by the need for decarbonization; powerful fossil fuel interests; and a News Corp–saturated media happy to push the poisonous lie that global warming is a libtard con. The country’s promise is vast, like its paralysis.
 Already the talk, even among the conservative grandees wheeled out to pay lip service to anthropogenic climate change, is of the role drought, fuel loads, and arsonists—anything but the changing climate—have played in stoking the fires. Former conservative Prime Minister John Howard said recently that the “quiet Australians”—those undemonstrative middle-class voters who delivered Morrison a surprise win in last May’s federal election, despite polls consistently favoring Labor—want “balance” in the “debate” about bushfire solutions. But the “quiet Australians” who pose the greatest danger to the country are not the ones voting for climate inactivists like Morrison out of ignorance or misinformation.

They are the Australians who should be loud but can’t be bothered to raise their voices—those who know better, who understand the consequences of doing nothing on climate change, but have succumbed to the apathy of prosperity and are content to let a vote for the Labor or Green parties, or the occasional spicy tweet, define the limit of their moral courage. (And to be clear, I count myself among this group: What have I contributed to efforts to combat climate change? To date, essentially nothing.)

Even with months left to run in the Australian summer, thingswill, of course, return to some semblance of what we used to call “normality”: The heat will relent; it will rain, although probably not enough; winter will come. Then, before long, another catastrophe will be upon us.

My hope, like the hope of many around me, is that thesefires will be a catalyst for Australians everywhere—to permanent climaterage, and to an unceasing commitment to rapid, equitable, planetwidedecarbonization. We are in the contest of our lives.

This moment in history is obviously an end. If we are industrious and lucky,it will be merely the end of the fossil fuel era, rather than of human civilization itself. Whether this moment also prefigures a beginning is up to us.

What’s happening to our Earth is not normal and not acceptable. But resisting the temptation to merely recalibrate and go on asbefore will not be easy.

By Monday of this week, as I came to start work on this piece, I pulled my laptop from its place on the desk in my room, where it had sat mostly undisturbed, near an open window, for days.

The laptop was covered in ash. Smoke from the fires was still in the air, but I couldn’t smell it anymore.

Aaron Timms is a writer living in New York.

TurkStream: A New Route to Europe for Russian Gas

By: GPF Staff


(click to enlarge


Earlier this week, Russian President Vladimir Putin and Turkish President Recep Tayyip Erdogan launched the TurkStream gas pipeline at a ceremony in Istanbul also attended by Serbian President Aleksander Vucic and Bulgarian Prime Minister Boyko Borisov.

TurkStream's two strings will deliver Russian gas to two different markets: the Turkish domestic market and countries in southeastern Europe. It will also enable Russia to reduce gas exports through Ukraine and compete with other projects like the Trans-Anatolian pipeline, which will bring Azerbaijani natural gas to Europe through Turkey.

Kyiv has said that it has already felt the impact of TurkStream; Russian gas exports destined for Bulgaria, for example, are now bypassing Ukraine and being delivered through Turkey. According to Ukrainian estimates, the pipeline will decrease gas transit through Ukraine by 15 billion cubic meters in 2020.

Still, Russia’s Gazprom won’t be able to fully realize the benefits of the new pipeline just yet. Exports through the first string will depend on Turkish demand, which may be limited by energy supplies from other sources like Azerbaijan.

And construction of some parts of the second string has been delayed. In addition, the project may be subject to U.S. sanctions, according to the 2020 defense budget passed by Congress last month.