HOT AIR BALLOON FLIGHT

View this email in your browser 

Insights, analysis and must reads from CNN's Fareed Zakaria and the Global Public Square team, compiled by Global Briefing editor Chris Good

Seeing this newsletter as a forward? Subscribe here.

December 10, 2021

Fareed: Elon Musk Has It Wrong on Tech Subsidies

"In the United States, we tend to listen with rapt attention to the wisdom of people who have succeeded in the private sector," Fareed writes in his latest Washington Post column. "Alas, what came out of [Elon] Musk's mouth this week was a series of self-serving and ill-informed comments about President Biden's spending plans."
 
Musk panned tech subsidies, but Fareed notes that Tesla buyers get federal and often state tax credits, Musk's solar-panel endeavor SolarCity has been helped by subsidies and credits, and Musk's SpaceX does business with government agencies. What's more, Fareed writes, Musk ignored some important history.
 
"The federal government's investment in green energy is very similar to what it did in the 1950s with computer chips—paying more for a new technology so that the price could later come down for everyone," Fareed writes. "It resembles the investments government made in the 1960s to develop ARPANET, the first, rough version of the Internet, and, later, the Global Positioning System. Those policies, incidentally, created the digital infrastructure that made possible companies such as PayPal, the original source of Elon Musk's billions."

Should Older People Worry More About Omicron?

Early studies suggest the Omicron variant of Covid-19 can infect the vaccinated, but real-world data show it has not produced more-serious illnesses or more deaths in South Africa, where it was discovered. (Vaccine booster shots, meanwhile, seem to help a lot according to research conducted so far.) 
 
At The New York Times, Zeynep Tufekci writes that this means Omicron could be dangerous for the elderly. "In younger people who have been vaccinated or were infected earlier," Tufekci writes, "the immune system can still potentially prevent progression to serious illness by mounting a 'memory response'—essentially remembering that it encountered a similar virus before and unleashing more action. As we age, this response is less robust because our immune system becomes weaker. Even common colds can cause fatal outbreaks in nursing homes." As we figure out what to do about Omicron, Tufekci suggests older people should take care and that efforts should be made to protect nursing homes, for instance.

Russia Is Already Doing Damage

Calls continue for the West to stand against Russia's threatening military buildup near Ukraine's border—most recently from Ukrainian Foreign Minister Dmytro Kuleba, in a Foreign Affairs essay. But Russia's buildup is already harming Ukraine, Elisabeth Braw writes for the Financial Times: "Russia doesn't have to send troops in to harm its south-western neighbour. The presence of soldiers is already spooking foreign investors—and has become in itself an excellent tool of aggression that Kyiv can do nothing to prevent. ... For an economy as fragile as Ukraine's, the spectre of war is a massive blow."

Time to Raise Interest Rates?

No one knows when America's inflation problem will recede, The Economist writes, as it's a "fool's errand" to predict when the pandemic (and its attendant consumer-buying patterns) will lift. The mere expectation of inflation, meanwhile, can prolong it, as workers could demand higher wages, adding inflationary pressure, if they think prices will continue to rise.
 
The Federal Reserve is bound by previous promises not to raise interest rates before it stops buying bonds, which injects money into the economy. "The good news is that the Fed can taper [those purchases] fast enough to let it raise interest rates in March," the magazine writes. "If between now and then the pandemic greatly worsens, consumers slash their spending on goods or many missing workers return to the labour force, monetary policymakers can change course again. But they must give themselves the option of raising rates soon. In an ideal world it is an option that would already be on the table."

Portrait of an Illiberal Democracy

Hungarian Prime Minister Viktor Orbán has proudly declared his country an "illiberal democracy," and at Der Spiegel, Jan Puhl and Walter Mayr depict what that looks like. Like other populists, Orbán has aligned his political vision with the will of the people and has opposed migration and any change to the national culture—but his rule has also been accompanied by rampant "cronyism" and political patronage, Puhl and Mayr write. 
 
The motivation seems to relate to ideas of national greatness. "The trauma of Trianon"—the 1920 peace treaty that broke up the Kingdom of Hungary—"deeply rooted in the national psyche, is the underlying narrative for Orbán's nationalism and anti-EU propaganda," Puhl and Mayr write. "He has the feeling 'that they want to take our country away from us, not with the stroke of a pen like 100 years ago in Trianon,' Orbán's daring comparison goes, but with the help of migrants 'who don't speak our language and don't respect our culture, our laws and our way of life.'"