Globalaffairs

Issue 13/ February-March 2009
By Neha Rajan

26 November 2008 cited the day of the Mumbai terrorist attacks. The onslaught was conducted tenfold, violence striking the Chhatrapati Shivaji Terminus, the Oberoi Trident, the Taj Mahal Palace and Tower Hotel, Leopold Café, Cama Hospital, the Nariman House, Metro Cinema, a lane behind the Times of India building, the Mazagaon Docks, and Vile Parle (1). For fifteen years Mumbai has been the target of terrorist hostility, while India has experienced terrorism for decades (1). The former Chinese ambassador to the United States, Hu Shih, has been credited with saying: “India conquered and dominated China culturally for twenty centuries without sending a single soldier across her border”. The nonchalance and cleverness with which India has controlled other countries, mindful and intangible, has survived until today. Why is this military strategy not quid-pro-quo?

India has been controlled by the British, invaded by Persians, Dutch, French, and Chinese alike, and has warred with Pakistan and Bangladesh. Foreign soldiers have infringed on Indian soil on many occasions, whereas Indian forces have seen the sun rise at the same time for centuries. This incongruity lives, courtesy the inconsistencies and shortcomings that are housed by the Indian government. The Indian subcontinent, despite lax military policy and permissive border patrols, has achieved phenomenal economic success in the past decade. If the pacifism is to be reciprocated, if there is to be a dearth of foreign military influence in India, the indiscretion in its legislative system must be resolved. The problem areas lie in the two global arenas: the intercontinental and the domestic.

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Issue 13/February-March 2009
By Andrea Bonzanni

On 11th September President Evo Morales declared the Ambassador of the United States in La Paz, Philip S. Goldberg, “persona non grata” [1]. Five days later he announced a $ 4.5 million agreement with the Russian national energy giant, Gazprom, and said he regrets not having strengthened ties with Russia years ago [2]. At the end of the month it was the Russian Ambassador who spoke and told the world that the government of Bolivia had purchased five civil defence helicopters as a “first step” of deepening ties [3]. It has been a tough September for the United States in the Andean country. The first Indian president in the history of the country, after almost three years of incendiary anti-Yankees rhetoric, seems to have started putting his words into practice, while Russia is eager to restore its sphere of influence without restraining itself to the so-called ‘near abroad’, as it had initially appeared the case.

The attention of all the observers and policy-makers has of course concentrated on the super-power level and speculations about the vanished American hegemony in Latin America, the mistakes of the United States in the continent since the end of the Cold War are countless. Likewise, analysts are debating on whether or not the current awakening of Russia and its unscrupulous international activism will bring about a new version of the Cold War. I will rather focus in this article on the dynamics that have led a country like Bolivia to take such risky moves. Most of the accounts have hitherto concentrated on idealistic and quasi-personalistic motives, arguing that the political program of Evo Morales and its Movement Towards Socialism (MAS) have led to a necessary confrontation with the United States.

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Issue 13/ February-March 2009
By Glen Ruffle

Governments should allow banks to fail and endure short-term pain in order for them to be long-term gain

As predicted, the governments of the developed world are falling over themselves trying to stop what is inevitable. In acts of gross stupidity, they are borrowing more and more money, nationalising more and more banks, and making the state ever bigger at a time when the exact opposite is needed. In Britain, every new-born baby instantly inherits a share in the national debt of ₤17,000; an outrageous sum that will only grow bigger as the government continues to pursue the economically flawed policies it has used for the past decade.

Had Milton Friedman still been alive, he would probably have looked sadly at the policies being put forward and notice the amazing similarities between today and the 1930s crisis. In both cases, a dramatic cut in the supply of money has helped cause a meltdown of the system. Desperate to restore the flow of money, governments have thrown billions at the markets in order to try and restart the cycle of investment and production that is essential for capitalism’s survival.

Yet they have missed a key point: the good times at the beginning of the 21st century necessitated the collapse now. Bankers came to believe their own doctrines of endless growth; they actually thought that house prices could endlessly increase.

The Spanish example is a case in point. Vast swathes of Spanish land was bought up and built on, and sold to those with money from northern Europe. The idea of a place in the sun caught on, and more and more people wanted a piece of Spain. Prices rose as companies realised they could make a large profit.

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Issue 13/ February-March 2009
By Priya Nandita Pooran

The past several months have produced a range of challenges for financial institutions and regulatory authorities throughout the international financial system. For the first time since the proliferation of the new range of financial instruments, global regulators have had to confront the weaknesses in these techniques and seek an effective regulatory solution, both nationally and at a system-wide level.

The crisis is almost unprecedented. It is potentially unprecedented in two significant ways. First, in financial terms, the crisis is unprecedented in the difficulties of quantifying the exact losses, the extent and location of risk transfer, the cross-border nature of the transactions at play and the lack of a cross-border mechanism for governing and assessing such transactions (including the extent of risk transfer) on an institution-wide level. Second, the crisis presents unprecedented regulatory challenges. It seriously challenges and questions the efficacy of existing regulatory approaches, requirements, frameworks and institutions. The failures of financial institutions in the months following the difficulties of Lehman Brothers, the fourth-largest investment bank in the US, on Sept. 15, 2008 will inevitably lead government authorities, regulators and law-makers to closely question to the causes of this crisis. They are already injecting liquidity and provide support to institutions. They will also review the role of regulation in the modern global financial system. Although these developments are inevitable and valuable, (in the terms of government support, to a more limited extent), the real value of this crisis lies in the reforms it will force in cross-border commercial transactions, that correct the failures of the present system of regulation and strengthen the international financial architecture to promote stability on institutional, national, regional and global levels.

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Issue 13/ February-March 2009
By Erica L. Green

These days when we think of cholera we may think of Gabriel Garcia Marquez’s epic novel about love and seduction or we may think of it as one of those diseases reminiscent of the plague that wreaked havoc in Europe during the 14th century. However, in recent years cholera has been making an unwelcome comeback in Zimbabwe and people point to the President Robert Mugabe as the person to blame.

Although, cholera has been out of the media spotlight as a threat for quite some time, the disease was never eradicated. It has always remained at bay with greater prevalence in developing countries such as Zimbabwe where poor sanitation is high and over crowding is common (1). Cholera is an intestinal bacteria infection that effects both young and old and is spread by fecal contaminated food or water. With a rapid onset, extreme cases include diarrhea, vomiting, and dehydration. If left untreated one may experience death within a matter of hours (1). Research suggests that 80% of those who contract the disease will have mild symptoms of diarrhea while the remaining 20% will suffer high levels of dehydration which can lead to death (8). Generally in developing countries, the casualties from such an outbreak only effect one percent of those infected with the disease, but Zimbabwe’s most recent outbreak now reaches a record five percent (2). Health officials state that cholera levels have reached epidemic proportions with a staggering total of 3000 deaths and over 57,000 people infected (3).

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Issue 13/ February-March 2009
By Sebastian Tapia

Each winter seems to be tougher than the previous one. And this boreal winter is not the exception to this rule. Today, eastern Europeans homes have adequate heating systems, most of them depending on natural gas. However, a few days ago, the cold sweeping across the region couldn’t be fought, since there was no gas.

Gazprom, the biggest Russian energy company, had announced that it would stop the gas supply to Ukraine by January 1st 2009, if the debt wasn’t settled. And that threat was real, just like in 2006. Again it seemed the Eurasian giant was behaving like a bully, pressing on a “young democracy” to get a higher price on gas. However, the situation was quite different.

Russia’s need to increase the price on gas for former members of the Soviet Union does not come from the economical sphere, but from the political one. To get the support of the European Union to enter the World Trade Organization, Russia needs to level internal gas prices to market prices before 2010 (1). Hence, it will level the export prices to market prices.

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Issue 13/ February-March 2009
By Mazen Raydan

Not even the Mediterranean waves that melt on Gaza shores could carry hope or the breeze of freedom they dream to breathe, with Israel controlling the strip’s airspace and territorial waters, beside the wired borders on the northern –eastern side.

The Egyptian borders became the breathing apparatus that pump life to this isolated sector, but even this side closed in March 2006, after the free election of Hamas starting a blockade, isolating Gaza from the rest of the world.

For two years people of Gaza asking the same Question why? Why they have to suffer for a choice they have made, meanwhile lessons of democracy were playing in their regions; why the fuel and water pump, electricity, and Rafah borders should be closed.

The answer was the rockets Hamas is firing, but why we don’t suppose that these rockets were the voice of the suffocating people inside of Gaza, raising their voices, that we are still alive.

The siege suffocated Gaza for two years and the world shut its ears and watched in silence, they watched 3900 factories closed, 65 thousand employees losing their jobs, 1million dollars loss each day, forcing 90% people to rely on the humanitarian aids to survive.

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Issue 13/ February-March 2009
By Kim Young

In memory of Rohinton Maloo

At the time of writing, President Barack Obama has just taken the oath of office and is officially the President of the United States this 20th day of January 2009. To a sea of hopeful and joyous people, Obama promised to uphold the constitution and declared the hand of peace and friendship to all Nations while also reminding those of preferred terror that the United States would “defeat them”. These words are not lost on those who are looking for a new direction in foreign policy from the United States especially after eight years of the Bush Administration, which included a decline in the US’ reputation worldwide, a failed war in Iraq and another one waged in Afghanistan. The import of this statement was also etched in the mind of one Briton business executive who walked away physically unscathed but probably emotionally scarred from the terror that gripped Mumbai, India in November 2008.

Personally, this writer noticed a familiar face but it could not be, or could it? Looking relieved and slightly shaken, (yet unbelievably composed) and covered with what looked like soot, indeed it was the face of Alex Chamberlen. He was on the BBC recounting the horror of the attacks just a few weeks ago in Mumbai (formerly known as Bombay), India. He escaped alive but tragically his good friend did not.

Worried for his safety and that of my fellow British citizens, Westerners, Indians and indeed anyone caught in this cowardly act of terrorism, I remained glued to the BBC and CNN to watch in horror as I heard of more and more people being murdered in cold blood, hostages taken and bombs and rockets going off in the affluent areas of Mumbai that houses the world famous Taj Hotel, The Oberoi and the Trident next door.

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