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19. april 2005
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Larry Kudlow is deeply worried about the current China-Japan conflict, as we all should be. But he also chastises some Republicans for threatening to launch a currency- and trade war with China.
The threat of a currency war could be an unnoticed factor in the recent U.S. stock market plunge. A much slower China economy would take a percentage point or two off U.S. economic growth, especially in areas like commodities, cyclical industries, tech, transportation, shipping, and trucking. These are the exact market sectors that are getting hammered on Wall Street.
Have the U.S. Treasury, the G-7, and the IMF forgotten the recent history of misbegotten currency manipulation? When several Asian currencies were forced to de-link from the U.S. dollar in the 1990s, world deflation followed. Floating exchange rates were a big mistake then, and could be a big mistake now.
China is currently a locomotive for the world's economy, and nobody wants to pay the price for slowing it down. The Chinese leaders certainly don't want that to happen, either, so their escalation of the Japanese-Chinese trouble is somewhat puzzling. Maybe it makes sense in the short term to channel public discontent towards the hated enemy in the east, but it is perhaps not wise if the public gets a taste for voicing dissent in this disorderly manner. China's massive economic growth is going to hit a hitch sooner or later. Growing differences between urban and rural areas are already a source of frustration. History teaches us, however, that while a distressed underclass sometimes pose a threat to unpopular rulers, a middle-class fearing the loss of its prosperity in times of economic turmoil is a much more potent threat.
So what will the Chinese autocrats do when they start feeling the heat from their own people? Will they choose the "Argentine junta" solution and start a military adventure, even at the cost of the country's economy? This is the kind of questions that probably keep people awake in Japan and Taiwan.
11:22:28 PM 
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The cardinals have elected a new pope. Who it is will be announced Real Soon Now.
Update: The favourite, Joseph Ratzinger the "Panzer-Cardinal" has been elected pope. The 78-year old ultra-conservative will take the name Benedict XVI.
So much for nobody expecting the holy inquisition.
Update 2: WaPo was soon out with a long article. Here is what Ratzinger said last Monday in a sermon:
"To have a clear faith according to the church's creed is today often labeled fundamentalism," he said, "while relativism, letting ourselves be carried away by any wind of doctrine, appears as the only appropriate attitude for the today's times. A dictatorship of relativism is established that recognizes nothing definite and leaves only one's own ego and one's own desires as the final measure."
Unlike a dictatorship of fundamentalism, which leaves, eh, only one's own ego and one's own desires as the final measure. It's just a question of whose values and egos make the decision, not?
It's more useful to define "fundamentalism" as a refusal to acknowledge the mere possibility that your own values and beliefs may not be universal and absolutely true. It's hardly "relativism" to have different values than those thought up by some old men several centuries ago.
Update 3: So what does it tell us that the new pope chose the name Benedict?
St Benedict (d. 543) was the occasional hermit who is credited with inventing the western monestary system.
Pope Benedict XIV (d. 1758) is mostly known as a scholar-pope, being considered well-read and intelligent. He was. however, opposed to the litugical reforms of his predecessor, and was deeply conservative. This was in contrast to his more reconciliatory line on the conflicts caused by the reformation.
Pope Benedict XV was pope during World War I.
His pontificate was dominated by the war, which he termed "the suicide of Europe", and its turbulent aftermath. His early call for a Christmas truce in 1914 was ignored, and though he organised significant humanitarian efforts (establishing a Vatican bureau, for instance, to help prisoners of war from all nations contact their families) and made many unsuccessful attempts to negotiate peace, his effectiveness even in Italy was undermined by his pacifist stance. The best known was the seven-point Papal Peace proposal of August 1917, demanding a cessation of hostilities, a reduction of armaments, guaranteed freedom of the seas, and international arbitration. Only Woodrow Wilson responded directly, declaring that a declaration of peace was premature; in Europe each side saw him as biased in favour of the other and were unwilling to accept the terms he proposed. This resentment resulted in the exclusion of the Vatican from the Paris peace conference of 1919; despite this, he wrote an encyclical pleading for international reconciliation, Pacem Dei munus.
Maybe even more relevant for the choice of name, Benedict XV was known for his opposition to the rising modernists within the Roman Catholic Church.
I am pretty impressed that the Wikipedia article is already updated to say more or less what I intended to write in my conclusion:
Thus, when Cardinal Joseph Ratzinger was elected pope in 2005, his choice of the title Benedict XVI was intended to convey a promise of humanitarian diplomacy and a firm stance against modernism.
6:35:44 PM
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Moussaoui is now planning to plead guilty to involvement in the 9/11-01 terror attacks:
Zacarias Moussaoui has notified the government that he intends to plead guilty to his alleged role in the Sept. 11, 2001, terror attacks and could enter the plea as early as this week if a judge finds him mentally competent, sources familiar with the case said yesterday.
Moussaoui's plan to plead guilty comes over his attorneys' objections and still has several obstacles -- including Moussaoui's own whim. The French citizen, the only person charged in the United States in the attacks on the World Trade Center and Pentagon, tried to plead guilty in 2002, claiming an intimate knowledge of the plane hijackings. But he rescinded his plea a week later. His mental state has been an issue in the case ever since, and U.S. District Judge Leonie M. Brinkema in Alexandria is scheduled to meet with Moussaoui this week to determine if he has the mental capacity to enter a plea now, the sources said.
I'm pretty convinced the guy is a fruitcake who was more a danger to the terrorist group than an asset to them.
12:55:37 PM
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The head of the Hamas political bureau, Khaled Mash'al, gave a speech at a convention in Egypt, stating that the current "calming down" is just a trick to avoid a Palestinian implosion, and giving the terrorists chance to regroup. MEMRI brings the translation.
"We have made an achievement in the Palestinian arena... We wanted to avoid the internal Palestinian implosion that Sharon wanted. He [Sharon] wished for dissent [among us] so that he [could] pressure Abu Mazen to confront the resistance... [With our consent] we avoided it. Our second goal was to send a message to the international community that the problem does not lie with the Palestinian people or the Palestinian resistance, [but rather] with the occupation... Our third goal was to give a chance and headspace to set the Palestinian house in order... Fourth, we strived to achieve, through the temporary initiative of Tahdiah, a chance to fulfill the Palestinian peoples' direct interests, such as releasing prisoners...
"... Every term has a special meaning, and our choice [of the term] Tahdiah is not incidental. A Hudna [cease fire] is an agreement whose terms are acceptable to both sides, but in the current situation there are no such terms. The Palestinian side is the weak one... we treat this Tahdiah as a Palestinian initiative conditional to the other side fulfilling the terms...
"… Hamas controls its military wing... and despite that fact that it is one of the largest factions of the resistance, it is highly capable of keeping its men disciplined. Tahdiah means Tahdiah [and when you talk of] escalation, there is escalation. There is a commitment and it is honored... In the eyes of Hamas, Tahdiah is a trick within the resistance plans, [but] in the eyes of the [Palestinian] Authority, Tahdiah is a step on the way out of the resistance plan... but we still give it a chance... we can be patient and suffer, but not from the perspective of those who want to be free of the Intifada..."
He doesn't have high opinions of the Palestinian Authority, either.
12:18:29 PM
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© Copyright 2005 Jan Haugland.
Last update: 01.05.2005; 01:55:45.
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