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What Happened Today: September 16, 2022
World Bank warns of “devastating” global recession; Putin finds limits in “no-limit” pact with China; King Ye moves out of Gap castle
The Big Story
A new World Bank report said on Thursday that the consistent and aggressive interest-rate hikes by the world’s largest central banks have significantly increased the chances of a “devastating” global recession, just three years after the previous worldwide recession. Though the central banks aren’t explicitly coordinating their monetary policies, they’re all attempting to tame inflation and have followed the lead of the U.S. Federal Reserve, which is expected to bump rates by 75 basis points for the third consecutive meeting next week. Collectively, the central banks have undertaken what the World Bank described as the “most intentionally synchronous episodes of monetary and fiscal policy tightening of the past five decades.”
With some nations already in a recession, and most raising interest rates at an accelerated pace, the monetary policies have begun to amplify one another, and they are slowing the global economy far faster than some central bankers previously anticipated. “By simultaneously all going in the same direction, they risk reinforcing each other’s policy impacts without taking that feedback loop into account,” said Maurice Obstfeld, the former top economist at the International Monetary Fund. Already, “global growth is slowing sharply, with further slowing likely as more countries fall into recession,” according to David Malpass, president of the World Bank. The ongoing durability of the U.S. dollar might mean the United States will see some improvement to inflation, but abroad, the rapid weakening of other currencies combined with higher interest rates on debt will increase already-mounting pressure on their economies.
In the Back Pages: Weekend Reads
→ The so-called “no-limit” friendship that Russian President Vladimir Putin and China’s president, Xi Jinping, announced in February apparently has a limit after all. In his first trip abroad since the beginning of the COVID-19 pandemic, Xi met with Putin on Thursday during a regional summit attended by Chinese allies, and it seems that the Chinese leader was none too pleased with his Russian counterpart. “We highly appreciate the balanced position of our Chinese friends in connection with the Ukrainian crisis,” Putin said in a televised statement during the meeting. “We understand your questions and concerns in this regard.” The high-profile admission that Beijing did not unconditionally back Russia revealed that there were, in fact, “forbidden zones” to its alliance with Russia, specifically the growing impact that Russia’s disastrous invasion of Ukraine has had on China’s access to Western money, markets, and technology. In their own state media coverage of the gathering, Chinese news outlets did not broadcast Putin’s “questions and concerns” comment, instead quoting Xi that Russia and China will continue their support of each other’s “core interests.” Xi made no mention of the Ukraine conflict.
→ Map of the Day:
Record-breaking monsoons in Pakistan along with unprecedented levels of glacial melt in the Himalayas have left much of the country inundated with water, so far killing 1,500 people and leaving many in this impoverished country without shelter. July and August saw 190% more rain than the 30-year average, while Sindh Province in the country’s southwest saw 466% more rain than usual. The total damage to crops and livestock in a country already struggling with a hunger crisis is more than $30 billion, according to Reuters, and some 30 million people have been displaced by the floods.
→ Thread of the Day:
In a new recording obtained by The Logic, a top Amazon lobbyist reveals that the company could pull its third-party e-commerce business out of Canada all together if it were to adopt anti-trust laws similar to those now being considered by the U.S. Congress. In the thread about the Logic article, journalist Matt Stoller points out that “tens of thousands of merchants in Canada depend on Amazon, so do millions of consumers. It is core infrastructure.” But the lobbyist says that, just as in Canada, if the U.S. legislation were to go through, Amazon might shut down its U.S. merchant marketplace, which at the moment is where roughly 25 cents of every U.S. dollar is spent online. Threatening to take down what amounts to one-fourth of the U.S. e-commerce business is a significant escalation from Big Tech platforms’ previous ultimatums issued to nations, but even if just a bluff, it points to the growing influence Big Tech executives have over essential national infrastructure.
→ Number of the Day: $700 million
The amount Yvon Chouinard, the founder and CEO of Patagonia, will save in taxes because of his recent decision to transfer 98% of his company to a nonprofit dedicated “to fighting the environmental crisis and defending nature”—a move The New York Times celebrated, adding “that the family received no tax benefit for its donation.” But as Bloomberg noted upon reviewing the details of the transaction, Chouinard has in fact structured a deal that allows “him and his family [to] keep control of Patagonia while shielding them from tax bills that could have totaled hundreds of millions of dollars.” And when Republican megadonor Barre Seid made a nearly identical move in August, the Times was quick to describe the “cash infusion” of “dark money” as the result of an “unusual series of transactions that appear to have avoided tax liabilities.”
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→ San Francisco is rolling out a new program to combat its homelessness crisis, with California Gov. Gavin Newsom signing a bill on Wednesday that will allow the state’s courts to order individuals to “submit to treatment plans,” as The Mercury News puts it, noting that “if the patient does not comply, they could be referred to a more restrictive form of treatment in a locked facility or they could be jailed if they have a pending criminal case.” The program, called CARE Court, comes following recent revelations from city officials about the skyrocketing cost of caring for the city’s homeless population—for instance, that five people had racked up a $4 million bill by using ambulance services to cycle in and out of hospitals, psychiatric facilities, and the streets—a problem that court-mandated trips to “locked facilities” are aimed at alleviating.
→ Quote of the Day:
Everyone knows that I’m the leader, I’m the king … A king can’t live in someone else’s castle. A king has to make his own castle.
Two years ago, Gap enjoyed the largest single jump to its stock in more than four decades on the news of its long-term apparel relationship with Kanye West. Gap anticipated its Yeezy Gap line could net $1 billion in sales and anchor the opening of new Yeezy stores. But those stores never happened, only two expensive clothing items were released, and now King Ye has scuttled the deal, arguing in a letter on Thursday that Gap has been too slow to produce his clothes and “abandoned its contractual obligations.” Gap confirmed it was walking away from the partnership, which doesn’t surprise many who suspected from the jump that there would be creative conflicts in an intense collaboration between the mercurial artistic savant and a buttoned-up publicly traded corporation.
→ Prosecutors in the case of Adnan Syed, the subject at the center of “Serial”—the true-crime podcast that investigated a Baltimore murder and that remains the most downloaded podcast of all time—are recommending that his murder conviction be vacated after new evidence was discovered tying two other defendants to the crime. Syed was charged in the murder of his ex-girlfriend, Hae Min Lee, and sentenced to life in prison plus 30 years. The state’s attorney’s office for Baltimore City, however, filed a motion stating it “no longer ha[d] confidence in the integrity of the conviction” after a yearlong investigation found that the state’s prosecutors had not shared crucial evidence connecting other suspects to the murder. However the state did not disclose—for those curious “Serial” fans out there—who those suspects were.
→ Image of the Day
Pablo Picasso’s 1919 “Guitar on a Table,” which is part of a collection of paintings and sculptures long on loan to the Museum of Modern Art in New York City that will be auctioned off so the institution can expand its holdings of digital art and its offerings of digital content. “We’re growing our digital audience,” the museum’s director, Glenn Lowry, said. “So we realize we need to increase our capacity off-site and online.” Last year the museum’s website, social media platforms, and YouTube channel saw more than 35 million people—5 million more than prior to the pandemic. With attendance still lower than it was before the pandemic, and with digital engagement growing, the museum is considering offering even more ways for visitors to explore the collection virtually, from creating its own streaming channel to partnering with a university to offer a graduate degree. “We’re just beginning to dream,” Lowry said.
Additional reporting and writing provided by The Scroll’s associate editor, David Sugarman
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→ Duke volleyball player Rachel Richardson accused BYU fans of hurling racial slurs at her throughout a recent game at the Utah school. Several national news outlets picked up the story, and representatives from BYU issued extensive apologies to Richardson, with promises to do better. It was a major media event about the ongoing moral failings of our bigoted legacy institutions. But then local news outfits, including a BYU campus paper, did the reporting that their national competitors had not, and discovered no one at the game shouted any racial slurs at all. As Jesse Singal explains in a recent piece for Common Sense, “This is all Journalism 101—but the big guys couldn’t be bothered.”
For millions of people watching this story unfold, this was yet another example of the ineradicable stain of American racism, of just how little progress we’ve really made.
Except it didn’t happen.
There is no evidence that the chain of events described by Richardson and her family members occurred. There isn’t even evidence a single slur was hurled at her and her teammates, let alone a terrifying onslaught of them.
All the journalists who credulously reported on this event were wrong—and it was an embarrassing kind of wrong, because the red flags were large, numerous, and flapping loudly. Richardson and her family members reported that racial slurs had been hurled with abandon, loudly and repeatedly, in a crowded gym filled with more than 5,000 people. But the journalists covering this incident never stopped to notice how odd it was that none of these vile slurs were captured by any of the thousands of little handheld cameras in the gym at the time, nor on the bigger cameras recording the match. Nor did they find it strange that in the days following the incident, not a single other eyewitness came forward—none of Richardson’s black teammates, and none of the players for either team.
→ Four non-governmental organizations spent almost $10 billion on fighting the spread of COVID-19 and developing vaccines, according to a new report from Politico and the German newspaper Die Welt, adopting “roles often played by governments—but without the accountability of governments.”
Helmed by the Bill and Melinda Gates Foundation, and joined by three organizations with deep ties and deep debts to the Gates Foundation, the four NGOs met with heads of state, CEOs of pharmaceutical companies, and the leadership at the World Health Organization (especially after a $1.4 billion donation, a larger contribution than that of the European Union or the United States) as they situated themselves at the center of global decision-making.
This inevitably led to conflicts surrounding the priorities of these all-powerful NGOs and whether those priorities should rule the day:
Civil society organizations active in poorer nations, including Doctors Without Borders, expressed discomfort with the notion that Western-dominated groups, staffed by elite teams of experts, would be helping guide life-and-death decisions affecting people in poorer nations. Those tensions only increased when the Gates Foundation opposed efforts to waive intellectual property rights, a move that critics saw as protecting the interests of pharmaceutical giants over people living poorer nations.
Working with the WHO, the four NGOs were central in the development of Access to COVID-19 Tools Accelerator, or ACT-A, which laid out the WHO’s targets for procuring and delivering tests, treatments, and vaccines for low-income countries.
The ACT-A diagnostics team set a target of making 500 million tests accessible to low-and middle-income countries by the middle of 2021. It procured just 84 million tests by June 2021, only 16 percent of its target, according to the report. The therapeutics team originally set a goal of delivering 245 million treatments to low- and middle-income countries by 2021 but later changed the target to 100 million new treatments by the end of 2021. As of June of that year, the therapeutics team had allocated only about 1.8 million treatments. [They] set the aim of delivering 2 billion vaccine doses by the end of 2021. By September of that year, it had only delivered 319 million doses.
→ Following the announcement of Roger Federer’s retirement from professional tennis this week, The New York Times writer Jesus Jiménez attempts to wrap up Federer’s career in a series of seven videos. All seven clips could have been just about his backhand, or his inside-out forehand, but these do still give a crude estimation of his range and ability to evolve over his decades on the court.
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