While vote counting continues in the UK’s referendum on its membership of the European Union, UKIP leader Nigel Farage has declared a victory for Brexit. The pound meanwhile has been sent tumbling to its lowest level since 1985.

Farage seemed to concede defeat earlier in the night when a ‘Remain’ win looked likely. He has now backtracked in a speech in the early hours of Friday morning, declaring Thursday’s referendum “a victory for ordinary people, a victory for decent people.”

His comments come as the ‘Leave’ vote has a 52 percent to 48 percent advantage over the ‘Remain’ vote.

“We have fought against the multinationals, against the big merchant banks, against big politics, against lies, corruption and deceit and today honesty and decency and belief in a nation I think now is going to win,” Farage said.

“We will have done it without having to fight, without a single bullet having been fired.”

Farage also branded the EU a “failed project” and said Thursday’s vote would “go down in our history as our independence day.”

Farage has also called on David Cameron to resign as Prime Minister “immediately” in light of a likely win for the ‘Leave’ campaign.

Not long after Farage’s speech, as votes continue to be counted and ‘Leave’ maintains its 4 percent advantage over ‘Remain,’ UK broadcasters BBC, Sky and ITV have all forecast a Brexit.

The so-called Islamic State (IS) has just released its first newspaper in the Malay Language, and declared in it a wilayah (province) in the Philippines. The publication of a Malay-language IS newspaper would have implications not only on Malay-speaking IS fighters in Iraq and Syria but also the Malay-speaking world in Southeast Asia.

By Jasminder Singh and Muhammad Haziq Bin Jani*

On June 20, 2016, Furat Media – an IS-affiliated media agency – published the first edition of Al-Fatihin, a newspaper meant for speakers of the Malay Language who have migrated and joined the terrorist group, dedicated to the creation of Daulah Islamiyah (IS) in Southeast Asia. According to its tagline, “Surat Kabar Bagi Muhajirin Berbahasa Melayu Di Daulah Islamiyyah”, Al-Fatihin would serve the existing Southeast Asian “foreign fighters” who are mostly from Indonesia and Malaysia. Although the choice of spelling and vocabulary reveals that Al-Fatihin is written in Bahasa Indonesia, it is comprehensible to all those who speak various dialects and forms of the Malay language.

The first edition of Al-Fatihin was well-timed to appear in the holy month of Ramadan, carrying a range of news and reports on the caliphate as well as features on religion. The 20-page edition focused heavily on the significance of Ramadan, jihad and the rituals of fasting. In fact, the first three pages contain advice from the Egyptian ideologue Abu Hamzah al-Muhajir, aka Abu Ayyub al-Masri, calling on IS fighters to continue their jihadist activities, search for martyrdom and kill and crucify the polytheists, disbelievers, oppressors and transgressors. The newspaper also carries a feature on a Syrian martyr Abu Bilal al-Himshi (dubbed a “Media Warrior”) and various news excerpts from Raqqa to the Philippines, information and statistics on military operations, a map of the world showing IS provinces, and zakat collection and distribution statistics in Syria.

Implications of a Malay Language Newspaper

Other than to serve the Malay-speaking readers in Syria and Iraq, the newspaper for “muhajirin berbahasa Melayu (Malay-speaking migrants)” could also serve the larger Malay-speaking audience in the Philippines, Indonesia, Malaysia, Singapore, Brunei and Thailand. With the exception of “Jayl al-Malahim” – an ISIS video depicting Indonesians and Malaysians burning their passports – IS articles and videos have largely been translated into Bahasa Indonesia and featured mostly Indonesians.

Even Al-Fatahin’s twitter account posted content in Bahasa Indonesia from Indonesian versions of the A’maaq News Agency, IS announcements and Nashir (IS’ caliphate updates). Marketing Al-Fatihin as a Malay-language newspaper is a strategic move to reduce the Indonesian flavour of IS propaganda and thereby appeal to a larger Malay audience, uniting all Malay-speaking jihadists and IS supporters with a common language that is more accessible than Arabic.

Invoking a broader Malay language and identity not only helps in disseminating IS propaganda, it also reinforces IS’ ideology and efforts to unite all jihadists. Al-Fatihin buttresses IS messages calling on militant groups in Indonesia and the Philippines to unite and pledge their allegiance to Abu Bakr Al-Baghdadi. These calls are often made in IS media such as the video production entitled “Bersatulah: Jangan Berpecah Belah” (Unite: Don’t be divided) released by al-Furat Media Foundation. In the latest video entitled “Al-Bunyan Al-Marsus” (A Solid Structure) released by IS on 22 June 2016, IS fighters from Indonesia, Malaysia and the Philippines called on all groups in Southeast Asia to unite.

Al-Fatihin’s tagline drives the point that, no matter the differences and nuances in language, identity and origins, Southeast Asian jihadists have a common logos and as such, all Malay-speaking jihadists should act as one. IS cleverly exploits the notion of Nusantara or archipelago used by Nadhlatul Ulama (in their version of “Islam Nusantara” – Islam in Indonesia), and radical and terrorist groups such as Darul Islam and Jemaah Islamiyah.

Significance of Timing

It is significant that there was no earlier attempt by Southeast Asian foreign fighters (who trained and fought during the Soviet-Afghan war) to publish a Malay newspaper or newsletter despite their intention to establish an Islamic state (Daulah Islamiyah) after their return. The publication of Al-Fatihin is possibly the prelude to the declaration of the Philippines as an IS ‘wilayah’.

IS probably hoped that Southeast Asian jihadists in Syria, Iraq, and the Philippines, and their supporters all around the world, would see Al-Filibin (The Philippines) as a province of the far-flung self-declared caliphate. Publication of Al-Fatihin would also enable IS fighters and supporters in Southeast Asia to feel that they are part of the caliphate, especially when they receive special greetings and messages that begin with “O, my mujahid comrade”, and reading jihadist news from Southeast Asia as well as news from Baghdad, Mosul, Raqqa, Damascus, Khurasan and Bangladesh.

As Benedict Anderson argued, in Imagined Communities, that nationalism was made possible with “print capitalism”, where books and media are printed in the vernacular instead of “exclusive script languages” such as Latin, Al-Fatihin serves that precise purpose, by using the Malay Language, and the conception of a Malay Nusantara to underline a common ideology and nationality.

Conceiving the Caliphate

The Al-Fatihin map showing the spread of IS territories worldwide helps readers see the far reaches of the caliphate from the Middle East and Africa to South, Central and Southeast Asia, even though IS does not administratively control most of these territories. Al-Fatihin provides a platform for Malay-speaking IS-affiliated jihadists to have a common identity and feel part of a community within a Daulah Islamiyah.

This sense of identity and purpose may motivate IS supporters to act militantly as is happening in Southern Philippines and Poso. In the video “Al-Bunyan Al-Marsus”, Abu ‘Aun al-Malizi, a Malaysian IS fighter, called on jihadists in Southeast Asia who could not afford to make the journey to IS territories in the Middle East, to either migrate to the Philippines or to kill IS enemies wherever they may be found, even using vehicles to cause their deaths. IS-related groups have to be neutralised or eliminated in Southeast Asia for Al-Fatihin to lose its potency and relevance, along with its plans for a caliphate.

*Jasminder Singh is a Senior Analyst and Muhammad Haziq Jani a Research Analyst with the International Centre for Political Violence and Terrorism Research (ICPVTR), at the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University, Singapore.

Einstein is often paraphrased as saying “everything should be made as simple as possible, but not simpler.”

These are words to live by when it comes to company strategy, which is often explained in terms that are either too simple or too complex.

There is no shortage of definitions of strategy, but there is often a gap between its theory and its practice. This is because the theory of strategy attempts to explain why companies succeed or fail, whereas the practice of strategy seeks to identify specific courses of action to solve problems and take advantage of opportunities on the ground.

Carlos Rey of UIC Barcelona and Joan E. Ricart, IESE’s holder of the Carl Schroeder Chair of Strategic Management, seek to narrow the gap. In an article titled, “The Practice of Strategy,” they propose a model to help harmonize business model innovation and company principles while meeting market demands.

The Big Three

Strategy is all about the logic behind making choices. But while logic may seem intrinsic to an individual, it often comes from very distinct areas, which can cause friction in company strategy. The authors have identified three types of strategic logic: analytical, institutional and systemic:

1. Analytical logic deals with cause and effect. For example, “an increase in customer satisfaction of 10 percent leads to a 6 percent increase in market share.”
2. Institutional logic considers a company’s values, and applies them to the situation to make a decision. While it might be expected that analytic logic would play a far greater role in strategy, thinking about appropriateness and the organizational identity is also very significant in practice.
3. Systemic logic employs a mixture of experience and intuition. It can fly in the face of hard data, but it is also often used by professionals with many years’ experience in the sector. An example would be the idea that “the key to success in the automotive sector is having a strong brand.”

These three logics go a long way to understanding how three experts in a company, based on the same facts and figures, can arrive to three entirely different conclusions about a strategy going forward.

It also explains how star companies may have taken vastly different roads to reach their success.

Logic and Perspective

Google’s immense success can be seen as a product of analytical logic, Johnson & Johnson’s as coming from their values (institutional logic) and Ikea’s as an example of systemic logic taking a central role.

Each of the three logics pertains to a larger strategic perspective, which represent how the practice of strategy develops.

1. Analytical perspective is developed deliberately through reasoning and is based on hard data, economic trends and market forces. The strategies derived from this perspective are simple, specific and prescriptive. The analytical perspective, broadly speaking, has two dimensions: external — business environment, sector, market, threats — and internal — resources and capabilities.
2. The institutional perspective is usually expressed through tools such as the company’s mission statement, but this is just a symbolic representation of it. This is largely a subconscious perspective and becomes a default when the company does not explicitly define its own strategy. It is the institutional perspective, moreover, which inspires people to place the company’s interests ahead of their own. It also fosters a long-term view.
3. The systemic perspective is developed through a profound knowledge of the real world of any given business. It often develops in an uncontrolled or unplanned way as events unfold, and influences strategy in the business model.

No one perspective is enough to make a company successful, even the examples above of Google, Johnson & Johnson and Ikea. In fact, while each can be seen to excel at a certain perspective, it is the integration of all three that creates strong businesses. The authors explain this integration with their SIA — for Systemic, Institutional, Analytical — model.

Take Ikea: its innovative business model has been accompanied by an ambitious business plan and solid institutional values. Ikea’s primary competitive advantage lies in the alignment and combined excellence of the three types of strategic logic.

SIA Model

In the SIA model, consistency between the three strands of logic is also important. A company that performs well in one logic, but contradicts itself in another, is unlikely to triumph overall.

Examples of such inconsistencies might be a low-price strategy at a company with a premium business model, repeated lay-offs at a company with values that emphasize trust, or a mission statement of “exceeding client expectations” at a low-cost company.

Practice What You Preach

Moving from theory to practice, the authors worked with a management team within a multinational energy company applying their SIA model as a means to reflect on strategy. They defined the company’s business model and those of its main competitors, then redefined the mission and values and reviewed objectives and budgets. By the time the process was complete, appetite for change and evolution was high in the management team.

The speed and agility in implementing the planned changes surprised both the authors and the participating managers. The difference had arisen from the method: rather than just defining strategy and informing the team, the strategy had been defined taking the different skill sets and strategic logics within the company into account.

In one company, at least, the gap between strategic thinking and action had narrowed dramatically.

The Center for Constitutional Rights (CCR) filed Thursday a brief in support of animal rights activists challenging Utah’s so-called “ag-gag” law, which punishes whistleblowing and undercover investigations inside of animal agriculture facilities. The law was enacted in 2012, over widespread public opposition. During legislative hearings, lawmakers expressed that the goal of the bill was to hinder animal rights activism.

“Utah legislators were transparent about their disdain for animal rights activists,” said Center for Constitutional Rights Senior Managing Attorney Shayana Kadidal. “If only they had the same appreciation for transparency when it comes to the violence the activists are documenting and exposing.”

Utah’s ag-gag law punishes recording images or sounds within an animal agricultural facility or gaining access to such a facility under false pretenses. Attorneys say the law is a response to undercover investigations inside animal farms and slaughter plants by animal rights activists. During hearings on the law, the bill’s sponsor referred to animal rights activists as “terrorists” and made clear the ag-gag law was aimed at “the vegetarian people” who “are trying to kill the animal industry.” Other legislators argued that investigations inside animal agricultural facilities should be criminalized because they are used “for the advancement of animal rights nationally, which, in our industry, we find egregious.”

Amy Meyer, a plaintiff in the case, was the first person charged under the law, after she filmed slaughter plant workers pushing a sick cow with a bulldozer. The Utah law applies to filming within facilities, but Meyer was on public property. The charges were dropped within 24 hours after independent journalist Will Potter broke the story. Four other activists from Farm Animal Rights Movement were charged under the Utah ag-gag law after filming a hog farm from a public roadway. Those charges were also dropped.

In the past decade, animal rights activists have conducted more than 80 undercover investigations inside of animal agricultural facilities. The investigations have resulted in animal cruelty prosecutions, plant closures, and the largest meat recall in U.S. history. In response, industry groups began an aggressive effort to pass state-level ag-gag legislation, prohibiting the documentation of practices on farms and in slaughter plants and efforts to gain access to animal facilities.

In August, a federal judge struck down a similar law in Idaho as a violation of the First Amendment.

Ag-gag laws are part of a broader pattern of legislation aimed at the repression of animal rights activists, which also includes the federal Animal Enterprise Terrorism Act (AETA). CCR is currently challenging the AETA on behalf of activists charged as terrorists for releasing animals from fur farms.

Global markets buckled, with stocks plunging from Tokyo to London and Chicago, after results from Britain’s referendum on membership of the European Union put the “Leave” campaign ahead. The pound fell the most on record, while haven assets jumped.

Sterling tumbled as much as 9.5 percent, the euro slid by the most since it was introduced in 1999 and the yen surged to its strongest level since 2013. South Africa’s rand led losses among the currencies of commodity-exporting nations, sliding more than 5 percent as oil sank below $48 a barrel and industrial metals slumped. Gold soared with U.S. Treasuries as investors piled into haven assets. Futures on the FTSE 100 Index plunged with S&P 500 Index contracts as benchmark stock gauges slid across Asia.

June 23rd marks the official breaking up of the European Union, a broken, dictatorial and corrupt Union that should have never existed in the first place.

While vote counting continues in the UK’s referendum on its membership of the European Union, UKIP leader Nigel Farage has declared a victory for Brexit. The pound meanwhile has been send tumbling to its lowest level since 1985.

Farage seemed to concede defeat way too early in the night when a ‘Remain’ win looked likely, not realizing the tide would turn. He has now backtracked in a speech in the early hours of Friday morning, declaring Thursday’s referendum “a victory for ordinary people, a victory for decent people.”

His comments come as the ‘Leave’ vote has a 52 percent to 48 percent advantage over the ‘Remain’ vote.

“We have fought against the multinationals, against the big merchant banks, against big politics, against lies, corruption and deceit and today honesty and decency and belief in a nation I think now is going to win,” Farage said.

“We will have done it without having to fight, without a single bullet having been fired.”

Farage also branded the EU a “failed project” and said Thursday’s vote would “go down in our history as our independence day.”

Not long after Farage’s speech, as votes continue to be counted and ‘Leave’ maintains its 4 percent advantage over ‘Remain,’ UK broadcasters BBC, Sky and ITV have all forecast a Brexit.

With only one hour driving distance from Baghdad, scene to constant ISIS terror attacks, Fallujah is a strategic tumor in Iraq’s neck that must be brought under control sooner or later, which is why the Iraqi government has wisely decided to liberate the city from the ISIS murderers before focusing on Mosul some 400 kilometers away.

But, instead of lending Iraq full and unconditional support in its anti-terror campaign, the US officials have been airing their misgivings about the Fallujah campaign, falsely claiming that it would divert precious resources for the Mosul campaign and cause massive refugee problems, and now adding to their initial criticisms with a blunt contradiction of Baghdad’s claim of near victory by stating that only a third of Fallujah has been liberated and the rest is still “contested.”

The US claim flies in the face of Iraqi operation commanders who just yesterday issued a clear statement claiming that with the exception of “a few areas” the city is now under the control of government forces. This is in correspondence with the earlier statement by the Iraqi government officials that some 80 to 90 percent of Fallujah including the city center and the main government buildings and hospitals are fully controlled by the Iraqi forces.

Even assuming that the government’s claim is somewhat exaggerated, this is no cause for the supposed ally to so publicly contradict its partner fighting a common enemy in the middle of the battle. That is tantamount to delivering a psychological blow to the Iraqis fighting the ISIS menace and a manna from heaven for those blood-thirsty terrorists who have committed so many atrocities deserving trial at international criminal tribunal.

By all indications, the US claim that two third of Fallujah is still contested territory does not seem accurate by the stream of reports in the Iraq media, confirmed by the international media embedded with the Iraqi forces, that various neighborhoods and sections of the city have increasingly come under the government’s control. Perhaps a more accurate estimate is that only about a third of the city is still in the ISIS’s hands, with so many of them shaving their hair and long beard and trying to mix with the civilian refugees and flee the scene, some apprehended in women’s clothes.

In turn, this raises serious questions about US’s intentions. What is behind Washington’s decision to openly contradict the Iraqi government and, in effect, undermining their efforts, by depicting a less than successful campaign to root out the ISIS from Fallujah? Is it because the Fallujah campaign is regarded as an Iranian preference, with direct advisory role played by Iran? Or is it because of the US’s aversion toward the Shiite militias, who have been sidelined in the Fallujah campaign solely as a result of the US’s objections so far? If the conflict in Fallujah drags on much longer, there is no doubt that the Shiite militias will play a more prominent role in order to bring it to a speedy closure, much to US’s chagrin.

Instead of choosing the wrong time to undermine the confidence of the Iraqi forces, the US ought to be extending military support, which is exactly what the Iraqi head of Parliament, Salim a-Jabouri, has requested in his meeting with the US officials. If this were the Israeli government, the US would be expeditiously shipping out billions of dollars of sophisticated military hardware and, yet, when it comes to Iraq Washington is deliberately stingy, thus raising questions about the scope of its anti-ISIS commitments.

Those commitments are somewhat melted due to pressure by Saudi Arabia, which has been publicly reeling at Iraqis’ advance against ISIS in Fallujah, thus making a mockery of its anti-ISIS pretensions.

Still, no matter what the US counterproductive gestures and shortcomings in helping the Iraqi government, the battle for Fallujah is destined to result in government’s favor, albeit at a high price in terms of the mass refugees and physical destruction of the city, and the sooner the US adjusts its policy toward achieving this necessary outcome, the better.

By Rustam Ali Seerat*

Over the course of the last month a series of abductions passenger’s buses have happened in the northern city of Kuduz, the city which last year fell into the hands of the Taliban. The Taliban has claimed the responsibly and have told that they have singled out and shot dead ex-members of the Afghan Army. In these incidents more than 200 passengers are abducted which 26 passengers have been shot dead, some others were released while some are still in their captivity. The Afghan President, Ashraf Ghani in his statements besides condemning these abductions by the Taliban called the group “Quta-0-Tariqs”, an Arabic word which means bandits (literally meaning road cutters). Categorizations as such have been consistent in the Afghan official language when addressing insurgencies, but given the general reference that it is attached to, the specificities of issues that Taliban contributes to have continued to elude the grasp of those who are seeking to deal with it.

There is no clear agreement among the Afghans on what to call the Taliban. The disagreements on what to name the group have stroke strong controversies among Afghans as well as people-governments. Hamid Karzai was calling the Taliban Baradaran Narazi (Unhappy brothers). Despite being heavily criticized, the president kept insisting on calling them brothers. He sometimes divided the Taliban into different binaries; as the good Taliban-Bad Taliban, Pakistani Taliban-Afghani Taliban. President Ghani, however, in his statement in his first days in office was calling the insurgent group as ‘political opposition’, which set a new controversies among the Afghan analysts. Some interpreted the newly president in office in positive and functional way. They reasoned the president by elevating the status of the group from “unhappy brothers” to the “political opposition” was aiming to convert the insurgencies to a politically organized political force, hopping it facilitate his way to start negotiating and finally integrating them in the government. In contrary some others pessimist of his approach saw this as a plotting act of the president who wants to empower the group and create it as a political force parallel to the Afghan government, because of his ethnic ties with the group.

After a deadly attack on the office responsible for providing ministerial and VIP protections in Kabul which resulted the deaths of more 60 guards in the early morning of March 19, 2016 ,the president in his speech in the parliament house moderated his use of term and called “some of the Taliban as the enemy of the Afghan people”. The use of the conjunction “some” again did not satisfy many Afghans who were waiting for the president to give a clear definition of Afghan friends and foes.

The Afghan people, social media users and social activists believe behind these friendly and soft terminologies and names in calling the Taliban is hidden the lack of political will on the side of the Afghan officials to fight the group. People want the government to declare the Taliban as the enemy of Afghan people. Some analysts believe, not defining the insurgent group in concrete words have affected the determination of the Afghan Army and weaken their morals in fighting the group which have led to strengthening the Taliban. These analysts also believe the use of un-concrete terminologies have distorted the understanding of the group, what it stands for and what it demands.

*Rustam Ali Seerat is a post-graduate in International Relations from South Asian University. He can be reached at: rustamali_seerat@yahoo.com

By Matt Hadro and Adelaide Mena

A meeting with Donald Trump in New York City on Tuesday was intended to answer the questions that some Christian leaders have about the presumptive Republican nominee.

But after the event, those in attendance had mixed reactions, with some saying it only raised further concerns.

“Donald Trump definitely won over the room, but the bigger story to me was why weren’t the big leaders there?” asked Christopher Hale, executive director at Catholics in Alliance for the Common Good, who attended the meeting.

“I think it’s important that a lot of the leaders within the Christian community are refusing to support him,” he told CNA, noting the absence of Christian leaders like Dr. Russell Moore, and adding that “I think they have the same concerns I do.”

The billionaire-turned-politician has run a presidential campaign brimming with controversy. He has drawn criticism for what many consider inflammatory rhetoric and derogatory comments aimed at women and minorities. His supporters say they find his blunt approach to politics refreshing.

Prominent Christian leaders, as well as influential members within the Republican Party, have been split on whether to support Trump, despite the fact that he has secured enough delegates to clinch the party’s nomination.

On Tuesday, he met with around 1,000 conservative and Christian leaders – mostly evangelicals – at his Manhattan hotel. He answered pre-selected questions from the audience on various issues like the family, abortion, guns, and foreign policy.

Some Christian leaders were noticeably absent from the meeting. Dr. Robert George, former chair of the U.S. Commission on International Religious Freedom, “declined to attend,” the Washington Post reported. Dr. Russell Moore, president of the Ethics and Religious Liberty Commission of the Southern Baptist Convention, was not there.

One evangelical pastor in attendance, Dr. Jeremy Roberts, said that he entered the meeting with “skepticism” but came out “more optimistic.”

The candidate was “receptive” and “very conversational,” he said, and the meeting was not a “photo-op” but rather a “genuine conversation between Evangelical leaders and Donald Trump, for him to hear the gospel of Jesus Christ.”

But according to another person in attendance, who wished to remain anonymous, the meeting was more a chance for Trump to say what he wanted rather than answer tough questions.

“There was a lot of teeing up,” the attendee told CNA, calling the questions asked of Trump “softball” and adding that he still “barely answered them.” Yet at the meeting Trump was compared to figures like Moses and David “who had great sins in their lives who turned out to be great leaders.”

On the family, “the only thing Trump said was that he told his kids not to do drugs, get in trouble,” the attendee continued, saying he “barely talked about abortion.”

“Going in my expectations were – I was open minded, but they were very low. But there was little of substance,” the attendee said, concluding that the meeting was “an enormous waste of time.”

Marjorie Dannenfelser, president of the pro-life Susan B. Anthony List, told supporters in an email that Trump “related well, coming across confident and comfortable in such a large crowd of thought leaders whose opinions and actions will be so critical as we approach November.”

She said that she was encouraged when Trump reiterated a commitment to appoint pro-life justices to the Supreme Court.

Hale said that he did not doubt that Trump believes in pro-life policies, but added that “he doesn’t sound like someone who this is a bread-and-butter issue for.”

On religious liberty, which was also brought up at the meeting, Trump didn’t sound as if “he knows the specifics of religious liberty concerns” that are talked about by Catholics today, Hale continued.

He pointed to one incident, in which a photo of Trump with Jerry Falwell, Jr. – the president of Liberty University who endorsed Trump and has been named to his evangelical advisory committee – made headlines because of a Playboy magazine cover hanging on the wall of Trump’s office in the background of the photo.

“I think that image epitomizes the difficult dance a Christian has supporting Donald Trump,” Hale said, voicing his agreement with Dr. Robert George who said that Trump is “manifestly unfit to be President of the United States.”

“Nothing he said yesterday changes my opinion of that,” Hale said.

Another Catholic in attendance, Joshua Mercer, co-founder of CatholicVote.org, said it was “good” that Trump met with Christian leaders, but recommended that he meet with Catholic leaders as well to “get advice” from them.

Eric Teetsel, who was the director of faith outreach for Marco Rubio’s presidential campaign, protested the meeting with a sign saying that various practices like torture, racism, misogyny, and murdering the children of terrorists were “not pro-life,” implicitly accusing Trump of supporting or condoning these practices at some point in his life.

Teetsel “wasn’t invited” to the meeting, he later tweeted, but said if he had gone he would have asked Trump the following question:

“Mr. Trump, you are a very wealthy man. You claim to be a Christian. You say you are pro-life, pro-religious liberty, and pro-marriage. There are many fine organizations working on life, marriage and religious liberty. Which ones do you personally support financially?”

Brian Burch, president of CatholicVote.org, was in attendance at the meeting. He told TIME magazine that Trump “came across as reasonable, not reckless.”

“Probably the biggest takeaway was not what Trump will do for them as president, but what Christians can do if they throw off the perception that they are a significant minority that are not relevant,” he added.

By Tridivesh Singh Maini

During South Korean Trade Minister Joo Hyunghwan’s recent visit to India, not only was the Comprehensive Economic Partnership Agreement (CEPA) reviewed, but a platform for promotion of South Korean Investment in India, ‘Korea Plus’ was also inaugurated. Representatives from both sides have been included in this platform. While there is one representative each from the South Korean Ministry of Industry, Trade and Energy and Korea Trade Investment and Promotion Agency (KOTRA), there are three officials from Invest India. Both sides have also agreed that the issue of India’s trade deficit needs to be addressed. India also sought access to sectors like agriculture, marine, IT and healthcare.

South Korea is important for India because it was amongst the first countries to have responded to India’s economic reforms in 1991. Its investments in India have witnessed a steady increase with brands like Hyundai, Daewoo, Samsung and LG becoming household names in the past two decades. India, however, does not figure amongst South Korea’s top 10 Foreign Direct Investment (FDI) destinations. Bilateral trade has been in the range between USD 15 Billion and 19 Billion USD in recent years. The Indian External Affairs Minister, Sushma Swaraj during a visit to South Korea in 2015 had rightly made the point, that this (figure of trade) is way below the true potential.

The realization that India-South Korea economic relations need to be given a strong fillip has been there for some time. It is for this reason that the two countries signed the CEPA in 2009 and both sides during the Korean Trade Minister’s recent visit to India sought to address some of the obstacles that limit full economic cooperation between them.

Apart from the economic sphere, strategic ties have also witnessed an upswing in recent times. During South Korean President Park Guen-hye’s visit to India in 2014, a number of issues such as, sharing classified military information, including proliferation activities by Pakistan and North Korea was shared. During Indian Prime Minister Narendra Modi’s visit to South Korea in 2015, a MoU was signed for cooperation between the National Security Council Secretariat (India) and Office of National Security (Republic of Korea). During Modi’s visit, Seoul had also expressed support for India’s entry into the Nuclear Suppliers Group, Missile Technology Control Regime, Australia Group and Wassenaar Arrangement.

Where avenues for cooperation between India and South Korea are galore, there are issues that continue to hamper the ties between these two nations.

To begin with, a number of India watchers in Korea are naturally disappointed after the scuttling of the POSCO project. A number of Korean companies which would have chosen India are now instead looking at Vietnam due to the improvement in investment conditions and its strategic location.

Second, on the Korean side too there is a realization within the business community that the bureaucracy in South Korea too is to blame, and that the political leadership needs to take charge and invest more in the relationship. While PM Modi during his visit in 2015 raised a number of important economic issues and even during January 2016, a business summit was held in India on issues which affect Korean businessmen, the political leadership on both sides is required to invest more in the relationship. Where CEPA and the Double Taxation Avoidance Agreement (DTAA) are certainly going to benefit the trade ties between the two countries, but both India and South Korea have to look beyond these measures and also try and overcome the negatives such as the persisting prevalence of Non-Tariff Barriers (NTB) in areas like agriculture.

Third, there is also a realization that South Korean businessmen need not restrict their investments to India to automobiles, infrastructure or in contentious areas where natural resources are at stake. Insteadm they can explore other areas once NTB’s are removed. A good beginning could be made by Korean investments in sectors like food processing.

Finally, South Korean investors need to reach out directly to more state governments. Currently, they have strong economic ties with Tamil Nadu, Telangana, Andhra Pradesh, Maharashtra, and Haryana and are seeking to build ties with other states. The onus is on state governments to reach out more pro-actively and explore possible areas of cooperation.

If one were to look beyond economics, there are strategic convergences between both countries which are not just bilateral. Both countries are trying to expand their global footprint and an article in Global Asia (March 2016) ‘South Korea’s drive for Middle Power influence’ by Yul Sohn strongly articulates how South Korea has been seeking to its Middle Power status by being part of Free Trade Areas (FTA) like Trans-Pacific Partnership (TPP) and Regional Comprehensive Economic Partnership (RCEP), and trying to promote a middle-power network of countries like Mexico, Indonesia, Turkey, South Korea and Australia. This East Asian country has begun to articulate its stand on key security and environmental issues in direction.

India too has been imaginative in its engagement and the focus has been on strengthening connectivity not just with South East Asia, but also in the Middle East and bolstering not the Act East Policy on the one hand and deftly strengthening India’s ‘Look West Policy’. Both , South Korea and India can look beyond just the bilateral relationship and explore cooperation in East and West. While in Iran, India has recently signed an agreement for developing the Chabahar Port during the PMs recent visit. Korean companies like Korean Electronic Power Company (KEPCO) are already investing jointly with the Iranians. Korea, in turn, can explore the possibility of helping India in infrastructural development in the Northeast. This will help in enhancing connectivity with Southeast Asia. Both countries need to find these convergences for strengthening their economic and strategic relationship.

While there is no doubt, that the past few governments have invested heavily in strengthening ties with East Asia, it is important that expectations are realistic, and basic issues which are preventing the second big-bang (post 1991) from occurring are addressed.

*Tridivesh Singh Maini is a New Delhi based policy analyst associated with The Jindal School of International Affairs, Sonipat. He can be reached at: tsmaini@jgu.edu.in

By Sinisa Jakov Marusic

In an address to the nation on Wednesday, after the parliament majority rejected the opposition motion for his impeachment, President Gjorge Ivanov defended his decision in May to pardon top politicians, saying it was either that or an internal conflict that would have prompted him to bring the army on the streets.

“The first option was to act reactively. That envisaged me standing on the side and waiting until conditions escalated. Then I would have had to activate the army to calm the situation. But that would have left the southern border [with Greece] unprotected and open for illegal migration. It would have been a signal for millions of potential migrants that the Balkan route is re-opened. Macedonia would have been flooded with migrants,” Ivanov said.

He said that the second option, which he chose, was to pardon 56 top politicians and their associates, mostly from the main ruling VMRO DPMNE party, which he said “was preventive. This envisaged me imposing new rules over the imposed game in Macedonia; to take control over the game and provide an advantage for Macedonia.”

In his address, Ivanov insisted that Macedonia was a target of a “special war” being waged by enemies which he did not name “as part of strategies for causing tensions and establishing permanent political crises,” so that his country could not handle threats and so that it became subordinated to foreign interests.

Ivanov said that he obtained information that the ongoing anti-government protests, dubbed the “Colourful Revolution”, which started in May, after he pardoned the politicians, would have started anyway as part of the “special war” against Macedonia.

He accused the opposition Social Democrats, SDSM, and the junior ruling party, the Democratic Union for Integration, DUI, of being part of the scenario to destabilize and weaken the country.

He also said that the EU-brokered Przino accord, reached last summer between the leaders of the four main political parties, had only worsened the crisis.

The accord envisaged a set of reforms and an interim government before the country could hold early elections.

However, the election date was postponed twice since the year started after the EU, the US and all main political parties but one, the main ruling VMRO DPMNE party, said the reforms needed for truly fair elections were not yet in place.

“The rule of law was breached by the leaders of SDSM [Zoran Zaev], and of DUI [Ali Ahmeti] because constitutional order was not enough for them to meet me and to make a deal. Instead they rushed to the foreign embassies. These two irresponsible politicians endangered the rule of law, sovereignty and independence,” he claimed.

Ivanov also slated the Special Prosecution, SJO, which was formed last autumn as part of the political agreement and tasked with investigating high-level crime.

He said that this institution was deliberately targeting only the ruling VMRO DPMNE party, which backed Ivanov’s presidential run.

“Instead of a Special Prosecution we got a selective prosecution that works strictly for the sake of the opposition,” Ivanov insisted.

“Of all the millions of files that they say they have, they choose only those that involve representatives of the government, of the VMRO DPMNE. The selective prosecution of SJO has created an atmosphere of nausea in society,” he said.

Ivanov further said that his country this year faced extraordinary security challenges, that the opposition knew about and yet pursued with its plan for destabilization.

He said that one of them was the infiltration of a group of 40 militants from the northern border, presumably from Kosovo, who were in the country to retaliate for the May 2015 Kumanovo shootout between the police and a group of armed gunmen which left 18 dead.

Ivanov did not discuss this matter further, not revealing how this threat was handled.

Ivanov made his address after the ruling majority in parliament rejected an opposition motion for his impeachment.

The opposition said Ivanov should be held accountable for pardoning the politicians, which they said had escalated the political crisis and practically blocked the work of the SJO.

In early June, Ivanov withdrew all 56 of the controversial pardons after facing pressure from protesters but also from EU and US who said that his decision breached the rule of law and undermined crisis-resolving efforts.

Britain’s looming exit from the European Union is another huge setback for negotiations on a massive US-EU free trade deal that were already stalled by deeply entrenched differences and growing anti-trade sentiment on both continents.

The historic divorce launched by Thursday’s vote will almost certainly further delay substantial progress in the Transatlantic Trade and Investment Partnership (TTIP) talks as the remaining 27 EU states sort out their own new relationship with Britain, trade experts said on Friday.

With French and German officials increasingly voicing skepticism about TTIP’s chances for success, the United Kingdom’s departure from the deal could sink hopes of a deal before President Barack Obama leaves office in January.

“This is yet another reason why TTIP will likely be postponed,” said Heather Conley, European program director at the Center for Strategic and International Studies, a think tank in Washington.

“But to be honest, TTIP isn’t going anywhere, I believe, before 2018 at the earliest,” she said.

Both the U.S. Trade Representative’s Office and the trade office of the European Commission, the EU’s executive body, declined to comment on the implications of the “Brexit” vote.

TTIP negotiators are still expected to meet in Brussels in mid-July as scheduled, but those talks were aimed at focusing on less controversial issues while leaving the thorniest disagreements for U.S. and EU political leaders to resolve. And it is unclear when Britain will launch formal separation proceedings, which will take at least two years.

But analysts said both sides have been reluctant to put their best offers on the table with a new U.S. president due to take office in January and French and German leadership elections nearing in 2017.

The Brexit also will preoccupy EU officials in coming months as they launch their own negotiations with London over the future terms of UK-EU trade, and sort out their post-Brexit priorities, said Hosuk Lee-Makiyama, director of the European Centre for International Political Economy, a Brussels-based think tank.

Britain’s departure could leave U.S. negotiators facing a European side that is more dug-in on some issues, said Chad Bown, a senior fellow at the Peterson Institute for International Economics, a think tank in Washington.

“As the UK is part of the coalition of liberal trading economies in the EU, the U.S. is losing one of the more like-minded countries from the group in Brussels sitting on the other side of the negotiating table,” said Bown, a former World Bank economist.

However, Lee-Makiyama, who also sees little chance of a deal before 2018, said Britain’s departure could eliminate one source of disagreement because the UK has insisted on a financial services chapter in the trade deal.

“The only real proponent of banking regulation in TTIP is the UK. Germany and France are probably willing to let it go,” he said. “It still leaves about 20 outstanding issues at nearly the same level of difficulty.”

The TTIP negotiations, which started three years ago, have unable to settle major differences over agriculture, where the EU side has shown little willingness to alter food safety rules that prohibit American beef raised with hormones or genetically modified foods, or open its closely guarded geographical food naming rules, such as for Asiago and feta cheeses.

European negotiators have complained that the United States has offered too little to open up its vast federal, state and local government procurement markets to European vendors with “Buy American” preferences in place.

Europe also wants access to key U.S. sectors such as maritime transport and aviation, while American negotiators have been frustrated over lack of access to some 200 European sectors ranging from healthcare to education.

The two sides also are far apart on how to resolve disputes. The U.S. side favors a traditional binding arbitration approach, while the Europeans want a court-like system that allows for appeals.

More progress has been made on harmonizing regulations for things like car seat belt anchors, clothes labeling and pharmaceutical inspections.

Last week I attended a wonderful conference in the university town of Tübingen, Germany, on “Debt: The First 3500 Years,” to bring ancient historians together to discuss David Graeber’s book Debt: The First 5000 Years.

I was enlightened by two papers in particular. Doctoral fellow Moritz Hinsch from Berlin collected what Socrates (470-399 BC) and other Athenians wrote about debt, and the conference’s organizer, Prof. John Weisweiler, presented the new view of late imperial Rome as being still a long way from outright serfdom. The 99 Percent were squeezed, but “the economy” grew – in a way that concentrated growth in the hands of the One Percent. In due course this bred popular resentment that spread in the form of debtor revolts, not only in the Roman Empire but that of Iran as well, leading to religious reforms to limit the charging of interest and self-indulgent greed in general.

I had not been in Tübingen since 1959, and it was my first chance to meet with David Graeber since he moved to England to teach at the London School of Economics after being hounded out of his apartment in New York City in the wake of the police and FBI crackdown against Occupy Wall Street. Our mutual German publisher, Klett-Cotta, sent its senior editor from nearby Stuttgart to discuss their German translation of my Killing the Host, to appear in November, as Der Sektor: Warum die Globale Finanzwirtschaft uns Zerstört.

Socrates’ views on whether bad debts should be paid

In Book I of Plato’s Republic (380 BC), Socrates discusses the morality of repaying debts. Cephalus, a businessman living in the commercial Piraeus district, states the typical ethic that it is fair and just to pay back what one has borrowed or received.[1] Socrates replies that it would not be just to return weapons to a man who has turned into a lunatic. Because of the consequences, paying back the debt would be the wrong thing to do.

At issue is not the micro-economic morality of paying a debt, but how this act affects society. If a madman is intent on murder, returning his weapon to him will enable him to commit unjust acts. The morality of paying back all debts is not necessarily justice. We need to take the overall consequences into account.

A similar logic may apply to today’s debate over whether Greece should pay back the IMF and European Central Bank (ECB) for the money that they have provided since 2010 to save bondholders from losses on loans (largely by French and German banks). The terms oblige the Greek government to pay in full instead of writing down debts to reflect the actual ability to pay.

The IMF staff calculated repeatedly that Greece had no way of paying off these debts, so the IMF violated its own articles of agreement (and its “No More Argentinas” rule) that it should not lend to countries which, in the judgment of its research staff, have no foreseeable means to pay.[2] IMF board members also protested to the bondholder bailout – all to no avail.

The morality of paying off the IMF and ECB is analogous to paying off the madman discussed by Socrates. At issue is what should be saved: wealthy creditors from loss (and the morality that all debts should be paid), or the overall economy from unemployment and misery leading to emigration, worse health and shorter lifespans. They have used their debt leverage to demand that Greece impose austerity, increase unemployment (now running at an enormous 25 percent for IV-2015 – I-2016), scale back pensions to retirees, and privatize public infrastructure to pay creditors – while running a budget surplus to suck even more money out of the economy.

When the Greek people voted in 2015 to reject these demands, the ECB and European Union insisted that referendums didn’t matter. Shifting economic policy from voters to bankers already had led Frank Schirrmacher to write an article in the Frankfurter Allgemeine Zeitung, “Democracy is Junk.”

What really is at issue is the selfish and abusive behavior of creditors. Later in the Republic (Book VIII, 555d-556b), Socrates talks with Glaucon, pointing to the “negligence and encouragement of licentiousness in oligarchies.” Their greed, Socrates explains, inserts the parasitic “sting of their money into any of the remainder who do not resist.” The effect is to burden many Athenians with debt, to suffer foreclosure on their land and disenfranchisement, fostering “the drone and pauper element in the state.” This leaves the people (the demos) to “conspire against the acquirers of their estates and the rest of the citizens, and be eager for revolution.”

The way to quench this disaster in the making, Socrates suggests, is to enact “a law prohibiting a man from doing as he likes with his own, or in this way, by a second law that does away with such abuses.”

“What law?” asks Glaucon.

“The law that is next best … commanding that most voluntary contracts should be at the contractor’s risk. The pursuit of wealth would be less shameless in the state and fewer of the evils of which we spoke just now would grow up there.”

This obligation of creditors to share in the risk of non-payment is precisely what the IMF staff and other critics of the European Central Bank’s pro-creditor line are now belatedly insisting. It is the principle that American bank reformers urged after the 2008 crash: Banks that made junk mortgage loans beyond the ability of debtors to pay should have their reckless and often fraudulent “liars’ loans” downsized to reflect reasonable rental values and real estate prices instead of being allowed to foreclose and push the U.S. economy into debt deflation.

Concentration of wealth by Rome’s One Percent leads debtors to revolt

Roman emperors sponsored a market economy that aimed at producing a fiscal surplus, which was used largely to pay mercenaries. Wealth and political power were concentrated in the imperial bureaucracy, army leaders, and their suppliers and provisioners. The tax reform of Diocletian (ruled 284-305), enacted in 297, taxed the hitherto exempt wealthy landowners as well as the rest of the economy. His successor, Constantine (ruled 306-337), enacted a monetary reform in the 310’s, basing the military-fiscal state on the gold solidus.

The effect was monetary deflation. “Like the gold standard of the nineteenth and twentieth centuries,” Prof. Weisweiler explained in his paper on the Late Roman economy, “the introduction of the solidus was a golden age for capital-owners but a dark period for lower strata of the population.” Yet Medium-sized farms survived without being reduced to serfdom, and wage labor was available for hire at harvest time. The proportion of Italy’s population enslaved is now deemed to have been around 15 percent.

There were no slave revolts, but debtors rebelled or defected to invaders, as they had done earlier in antiquity. Prof. Weisweiler described how, when a Gothic army defeated that of Rome at Adrianople (eastern Turkey) in 378, local guides brought the victors “to the villas of great landowners, who were then plundered by a coalition of Gothic soldiers and local residents. When in 408 the Romano-Gothic military leader Alaric for the first time besieged the city of Rome, his forces were swollen by many debtors who left the imperial capital to join his army.”

Richard Payne of the University of Chicago gave a paper explaining how peasant revolts against Persia’s Sasanian rulers a century later sought to “restore” an egalitarian Zoroastrian order as a protest against the extreme polarization that widened the gap between luxury and poverty. The new morality of economic balance rejected silk garments, silver wine vessels and other status symbols of the elites. Interest was condemned, as it had been under Christianity and would be under Islam. All religious urged mutual aid and warned about abusive wealth-seeking by the elites. What occurred culturally was a revulsion against luxury and hubris – a Greek word that connoted not only arrogance, but arrogance that took the form of injuring others.

Ideology and antiquity

Creditors were the typical class singled out as oppressive and destructive of society. Their self-centered wealth addiction was seen as stripping society to serve their own compulsive drives. It was to praise moderation and even to prefer a poverty of equality to indulgence in luxury that Christianity, Islam and other religious movements of the early first millennium AD took root.

By the 14^th century the great Tunisian Islamic philosopher of history, Ibn Khaldun, described societies gaining prosperity through “group feeling,” only to lose it within about 120 years as the ruling dynasty succumbed to self-indulgence and greed – paving the way for their land to be conquered from without or taken over from within.

My own paper for the conference described how Ibn Khaldun’s “rise and fall” view of history in The Muqaddimah was echoed in Giambatisto Vico’s The New Science (1725), and later by the French and Scottish Enlightenment by writers such as Adam Ferguson, who endorsed Montesquieu’s statement in Spirit of the Laws (1748): “Man is born in society, and there he remains.” To survive, people need to cooperate in a system of mutual aid. “Man is, by nature, the member of a community; and when considered in this capacity, the individual appears to be no longer made for himself. He must forego his happiness and his freedom, where these interfere with the good of society.”[3]

All this teaches the opposite of today’s two guiding economic premises: “Greed is good,” and “There is no such thing as society.” Economics used to be called moral philosophy, but it has succumbed to individualistic extremism. Homo economicus has replaced zoon politikon. Debts are supposed to be paid without concern for how this impoverishes the economy.

It was to resist personal gain-seeking at the expense of the body politic and group solidarity that the world’s major philosophies and religions for the past two thousand years urged self-control, generosity, care for the weak and poor, and rules to limit the luxurious self-indulgence and anti-social egotism it bred in ruling elites. Excluding this intellectual legacy from the curriculum has paved the way for inverting today’s moral attitude upholding creditor claims against the rest of society.

It should not be surprising that modern financial elites are fighting back against democratic moves to limit their wealth, adopt progressive taxation, write down debts by bankruptcy reform, and shift control of government away from landed aristocracies and banking centers. These vested interests are behaving exactly as Ibn Khaldun described the terminal decadent generation of dynasties as acting with anti-social selfishness.

Ferguson described how prosperity lay the groundwork for undermining the commercial stage: “man is sometimes found a detached and a solitary being: he has found an object which sets him in competition with his fellow creatures, and he deals with them as he does with his cattle and his soil, for the sake of the profits they bring. The mighty engine which we suppose to have formed society, only tends to set its members at variance, or to continue their intercourse after the bonds of affection are broken.”[4]

The financial takeover of government is not new. Ibn Khaldun described how what today is called the “deep state” (often run by foreigners or other interlopers) gains control of dynasties. Lacking traditional royal authority, they must work outside or behind the scene of politics, as finance does today:

In gaining control, he does not plan to appropriate royal authority for himself openly, but only to appropriate its fruits, that is, the exercise of administrative, executive, and all other power. He gives the people of the dynasty the impression that he merely acts for the ruler and executes the latter’s decisions from behind the curtain. He carefully refrains from using the attributes, emblems, or titles of royal authority. He avoids throwing any suspicion upon himself in this respect, even though he exercises full control. … He disguises his exercise of control under the form of acting as the ruler’s representative.[5]

Today’s Treasury Secretaries, central bank heads, IMF economists and client academics serve the world’s cosmopolitan financial ideology that money and credit, debt and taxes are purely technocratic, and hence beyond the sphere of voters or the politicians they elect to “interfere” with. We are back with the Thatcherite financial Taliban (the Arab word for “students”): There Is No Alternative.

That is the protective myth that elites have wrapped around themselves and their privileges from time immemorial. To succeed, it must erase knowledge of history and live in a highly censored “present” in which the financial class takes the land, public infrastructure and government into its own hands.

It has all happened before – and so have revolts by debtors and other exploited victims of such “economism.”

Notes:
[1] Plato, Republic, 331c-d. The term for justice is dikaiosyne, meaning “right behavior,” from dike, cognate to dexterous. I am indebted to Moritz Hinsch of Berlin for drawing my attention to this passage in his paper on “Private Debts in Classical Greece,” delivered to the international conference on “Debt: The First 3500 Years” in Tübingen, Germany, June 11, 2016.

[2] I review the IMF staff protests and Board complaints about the Greek loan in Killing the Host (2015), pp. 303-306, 310, 319f. and 335f.

[3] Adam Ferguson, Essay on the History of Civil Society [1767], 8^th ed. (1819), Section IX: Of National Felicity, p. 105. He adds (pp. 4f.): “both the earliest and the latest accounts collected from every quarter of the earth, represent mankind as assembled in troops and companies; and the individual always joined by affection to one party, while he is possibly opposed to another.”

[4] Ferguson, History of Civil Society, p. 34.

[5] Ibn Khaldun, Muqaddimah, : An Introduction to History [1377] translated by Franz Rosenthal (Princeton, 1967 [first ed. 1958]), pp. 377-79.

In December 2015, President Nicolás Maduro immediately recognised the opposition Democratic Unity (MUD) coalition’s resounding legislative election victory. For the first time in over sixteen years, the prospect arose of political cohabitation between the alliance led by the ruling United Socialist Party of Venezuela (PSUV) and its opponents, and with it a unique opportunity to resolve the protracted political crisis by peaceful and democratic means.

The government, however, has chosen confrontation, using control of the judiciary and other nominally autonomous branches of state to neutralise the opposition’s control of the National Assembly. The MUD seeks a recall referendum, which the constitution allows after the mid-point of any elected term of office. With battle-lines drawn, both sides treat many of the other’s decisions as legally and practically null and void. The government should cease efforts to block the referendum, and the international community should insist on a timely and effective dialogue with facilitators acceptable to both sides.

The conflict of powers is all the more damaging because the economic and social crisis has worsened significantly. The World Bank estimates that 2016 GDP will decline by over 10 per cent, and the International Monetary Fund (IMF) that inflation will approach 500 per cent in 2016 and more than 1,500 per cent in 2017. With no wage indexation, the population below the poverty line is growing fast. Food and other basic goods are scarce, and most Venezuelans cannot afford to buy enough if they can find them. The health service is close to collapse, with most vital medicines unavailable and hospitals experiencing a sharp increase in patient deaths. Most citizens spend hours every day queueing for price-controlled goods, with no guarantee of success. The government has refused to allow donors, private or public, to send food or medical aid, arguing that pressure to do so is a cover for foreign intervention so as to damage its reputation and ultimately remove it.

It has been apparent for some time that without some form of international engagement the crisis is unlikely to end peacefully and constitutionally. The government is doing all it can to hinder the MUD’s efforts to cut short the Maduro presidency by legal means. If a recall referendum is not held this year, it would lose much of its effectiveness, since the constitution provides for the vice president to take over if the president leaves office in the last two years of his term, which ends in January 2019. If, however, Maduro was removed by referendum in 2016, a presidential election would be required in 30 days. If it produced a MUD successor, the response of Chavista loyalists might pose serious governability problems.

The secretary general of the Organization of American States (OAS) has called for application of the Inter-American Democratic Charter, which provides for diplomatic initiatives, including good offices, in the event of an interruption of the democratic order in a member state. Simultaneously, two former Latin American presidents and a former Spanish premier, at the request of the Union of South American Nations (UNASUR) and endorsed by the June 2016 OAS General Assembly are seeking to promote a government-opposition dialogue. The former Spanish premier, José Luis Rodríguez Zapatero, briefed the OAS Permanent Council on 21 June on the exploratory stage of those efforts. No agreement has been reached on when that dialogue might actually start, and the MUD has described it as “thus far non-existent” and “convened by only one side”. The Council is scheduled to meet on 23 June to discuss the secretary general’s report.

To prevent an undemocratic, possibly violent outcome and facilitate an immediate solution to the rapidly worsening humanitarian crisis:

The government should

• declare a humanitarian emergency and permit delivery of external food and medical aid and its distribution by non-governmental agencies;

• refrain from using the Supreme Court to neutralise the elected legislature and permit a peaceful electoral solution to the political crisis by allowing the National Electoral Council (CNE) to exercise its constitutional role; and

• free all political prisoners, allow political exiles to return without reprisals and engage in direct, effective, and timely dialogue with the opposition.

The MUD and National Assembly leadership should

• prioritise national interest over partisan objectives;

• maintain their declared commitment to peaceful, constitutional resolution of the crisis; and

• make every effort to pursue an effective dialogue with the government.

The regional community should

• insist that the government permit emergency food and medical aid and prepare a thorough assessment of principal humanitarian needs and how to meet them;

• examine the crisis in the framework of the Inter-American Democratic Charter and urgently assist in restoration of constitutional norms and rule of law; and

• support efforts to pursue a structured, timely dialogue between the two sides and press the CNE to follow the constitutional timetable for a 2016 recall referendum.

The entire report may be read here (PDF)

Previous exposure to the dengue virus may increase the potency of Zika infection, according to research from Imperial College London.

The early-stage laboratory findings, published in the journal Nature Immunology, suggests the recent explosive outbreak of Zika may have been driven in part by previous exposure to the dengue virus.

The study, which included scientists from Institut Pasteur in Paris and Mahidol University in Bangkok, suggests the Zika virus uses the body’s own defences as a ‘Trojan horse’, allowing it to enter a human cell undetected. Once inside the cell, it replicates rapidly.

Professor Gavin Screaton, senior author of the research and Dean of the Faculty of Medicine at Imperial, said: “Although this work is at a very early stage, it suggests previous exposure to dengue virus may enhance Zika infection. This may be why the current outbreak has been so severe, and why it has been in areas where dengue is prevalent. We now need further studies to confirm these findings, and to progress towards a vaccine.”

A second study by the same team, published in Nature, suggests an antibody that works against the dengue virus may also neutralise Zika – providing a potential target for a vaccine.

Dengue fever has risen dramatically over recent decades and the virus is thought to cause around 390 million infections each year – with 40 per cent of the world’s population living in areas of risk.

The dengue virus is similar to the Zika virus – they belong to the same viral family, called the Flaviviridae, and both are transmitted by the Aedes mosquito.

In the new Nature Immunology paper, supported by the Wellcome Trust and the Medical Research Council, the researchers used antibodies that recognise the dengue virus collected from individuals who had been infected with dengue. The team, who were also supported by the National Institute for Health Research Imperial Biomedical Research Centre, added them to human cell cultures, together with the Zika virus.

Their results suggest dengue antibodies can recognise and bind to Zika, due to the similarities between the viruses. Crucially, they also suggest that pre-existing dengue antibodies can amplify a Zika infection through a phenomenon called antibody-dependent enhancement (ADE).

This has been previously identified in dengue fever, and is thought to be why a second infection with dengue is often more serious than the first.

When dengue first infects the body, the immune system makes antibodies against the virus. Antibodies are large proteins that latch onto invading bacteria or viruses, neutralising them and enabling the immune system to destroy the pathogens. The antibodies are then primed to recognise the same invaders should another attack occur.

However, there are four different types of dengue virus. If someone is infected a second time by a different strain, the antibodies from the first attack can only partially bind to the virus, and are unable to prevent infection.

The antibody, with the virus loosely attached, then shuttles into an immune cell. This immune cell would normally then kill the virus, but because the virus is not properly attached, it breaks free once it gains entry to the human immune cell. Here it hijacks the immune cell’s machinery to replicate more viral particles, enhancing the infection.

The new study suggests the same phenomenon occurs when a person who has previously been exposed to dengue encounters Zika. The existing dengue antibodies latch onto Zika, due to similarity between the viruses. However the antibodies are unable to latch onto Zika securely, and so the antibody simply facilitates entry of Zika into the human immune cells, where it replicates.

“We now need to investigate whether the phenomenon of ADE may aid transfer of Zika across the placenta,” explained Dr Juthathip Mongkolsapaya, co-author from the Department of Medicine at Imperial.

She added that the team also found that a type of antibody may help protect against the phenomenon of ADE, and prevent the virus from hijacking the immune cells. Previous work from the team has shown the immune system generates different types of antibodies to dengue that bind to various areas of the virus. In the current study, the team found a group of antibodies that bind to a certain site on the dengue virus – called EDE1 antibodies – were able to prevent the Zika virus from entering the immune cell.

In a second study, published in Nature and co-authored by Professor Felix Rey from the Institut Pasteur and Professor Screaton from Imperial, the team confirmed that EDE1 antibodies bind efficiently to the Zika virus and potently neutralise infection. The team are now working hard to use these findings to develop new vaccines to dengue and Zika.

Dr Jeremy Farrar, Director of the Wellcome Trust, said, “Zika and dengue come from the same family of viruses and we know they share many similarities in their genetic make-up, transmission pattern and in the immune response they trigger. These new studies suggest that prior infection with dengue doesn’t offer any protection against Zika, and may in fact predispose people to a more severe infection. We can’t say yet whether this interaction is playing a role in the current outbreak, but if confirmed it’s likely to have important implications for the control and global spread of Zika, and for the development of any vaccine for the virus. There are still more questions than answers about Zika and this group of viruses including dengue. We know that Zika has been present in Southeast Asia and Africa for many years and yet has not taken off there as it has in South America. This is what the international research effort needs to work out, and quickly.”

Mercedes-Benz said that never before has Mercedes‑AMG packed so much motorsport technology into a production vehicle than into the new AMG GT R.

The company said the front-mid-engine concept with transaxle, the twin-turbo V-8 engine rated at 430 kW/585 hp, the extensively modified suspension, the new aerodynamics and the intelligent lightweight construction all lay the foundations for an especially dynamic driving experience.

According to Mercedes-Benz, even from afar, the exclusive “AMG green hell magno” special paintwork leaves no doubt as to the sports car’s origin, having spent most of its development time in the “Green Hell” of the Nurburgring racetrack.

Additionally, wider front and rear wings allow an increased track width for optimum grip and even higher cornering speeds. The new front fascia with active elements, the large rear aerofoil and the new rear fascia with double diffuser enhance aerodynamic efficiency and help ensure optimum grip, according to the company.

Mercedes-Benz said the lightweight forged wheels shod with cup tyres as standard are likewise designed for maximum driving dynamics. The same applies to other new features such as the active rear-wheel steering, the nine-way adjustable traction control system and the adjustable coil-over suspension with additional electronic control.

“What is more, the new AMG Panamericana grille emphasises the unique standing of the AMG GT R. Its characteristic form with vertical fins celebrated its world première on the Mercedes‑AMG GT3 customer-sport racing car and now for the first time features on an AMG production vehicle,” Mercedes-Benz said.

(Civil.Ge) — Georgian PM Giorgi Kvirikashvili said that U.K.’s referendum decision to leave the EU “cannot change the fact that the European Union is the most important and the strongest political and economic union in the world.”

“Yesterday the majority of the British people voted to leave the EU. This is a democratic decision, which has to be respected, but personally I join those leaders across our continent, who expressed regret at such development,” the Georgian PM said in a written statement released on Friday evening.

“It is important to remember that there is no alternative to the European project of peace and cooperation and it will definitely continue.”

“This referendum cannot change the fact that the European Union is the most important and the strongest political and economic union in the world, whose strength will further grow,” he said.

“Now it’s time for self-reflection, as well as for consolidation and renewal,” the PM said.

“I am convinced that this process will give an opportunity to the European Union to make use of its strongest points, to become even stronger, and to move forward.”

“Therefore, over the coming months I look forward to seeing the EU play a strong leadership role in its neighbourhood, in line with its rightful place in the world,” PM Kvirikashvili said.

The antidote to the rise of populist politics based on distrust is in how we describe the disease itself. To view Trump simply as an aberration, a metaphysical monstrosity – which undoubtedly he is in some sense – is profoundly inadequate. We must see him as the symptom of a general disease; a disease which is global in nature, and which bears witness to the contradictions and antagonisms of the democratic capitalistic order.

By Dr. Sam Ben-Meir*

Donald Trump’s obscene demagoguery; his contemptuous regard for the first amendment, his desire to expand the authorities of the presidency (the awesome power of which has never been equal to what it is now), his belligerent and threatening attitude towards the judiciary, his shameless blurring of private and public agendas, his cynical exploitation of the fears of millions of Americans concerning Muslims in the wake of the nation’s deadliest mass shooting in Orlando, his nationalist, anti-immigrant, racist politics, and finally, his endorsement of violent outbursts against dissenters, have all served to raise the specter of a new fascism on the political landscape.

But to what extent is fascism an appropriate name for what Trump represents? By fascism, I simply mean a militaristic regime that is characteristically authoritarian, anti-immigrant, and extremely nationalistic. We must use the term carefully, as it is all too often a sign of intellectual laziness and a lack of conceptual clarity. To complicate matters, we are witnessing Trump’s political rise while at the same time extreme right-wing parties are making startling gains in many countries, including Austria, which had not seen such a development since the end of World War II. This is important because it indicates that Trump is not an isolated phenomenon. He should be thought of primarily as a symptom – a symptom of the decay of the democratic form of global capitalism.

Trump and his European counterparts are symptomatic of the fact that capitalism’s need for democratic institutions and processes has been steadily diminishing. The most efficient administrators of capitalism are arguably turning out to be non-democratic, authoritarian regimes, including nominally communist regimes such as China and Vietnam. When Trump says there is no democracy, that the whole system is rigged, what is most frightening is not that it may be true or that so many believe it to be true – in fact, his very ascendance demonstrates that there is still an irreducible element of contingency in politics.

We are witnessing all over the world the dissolution of the marriage between democracy and capitalism. It can be seen in the corrupt pseudo-communism of China, or the authoritarianism of Putin’s Russia and Erdogan’s Turkey, and it may take the form that we are seeing here: where the rule of law, integrity of our governing bodies, and voices of dissent are treated with contempt and mockery by the leader of a major political party.

Trump’s fascism is especially on display in his endless assurances that he intends for Mexico to finance a massive wall along the US-Mexican border. This promise – a fixture of each Trump rally – should not be answered by giving reasons as to why it is a bad idea, impractical, etc. Once you begin to provide arguments, you’ve already lost – this is because the proposal is not meant to be rational at all, but instead it is precisely meant to mock the use of reason in politics. Trump is treating his followers not as rational agents; rather, they are bundles of repressed, violent energy which Trump has expertly manipulated to his advantage.

Countless Americans are now more or less ready to deny the basic rights of millions of immigrants under the threat of forcible deportation, and to refuse hundreds of thousands of refugees seeking shelter and asylum. The way to address this xenophobic hysteria is certainly not through the liberal discourse of tolerance and respect for the other. On the contrary, the language of tolerance is totally misplaced here and counterproductive. More appropriate, rather, is a fidelity to human rights and an emphatic refusal to allow any group of people to be denied the fundamental conditions in which to live and thrive. Refugees don’t need sympathy and tolerance from us, and they don’t need us to open our hearts: they need us to open our borders and provide food, shelter, and work.

What Trump has effectively demonstrated is that political correctness, and the liberal insistence on rules of correctness, has served only to regulate hatred and racism while reproducing the subjective conditions that can give rise to violent racial outbursts. The miserable failure of political correctness lies in its attempt to impose what should be spontaneous; in mocking its inherent fakeness, Trump has managed to create the perception that he is somehow honest and authentic. The problem is that in place of political correctness, he’s given us a more or less open mixture of racism, misogyny, and nationalism.

Trump’s campaign has been a sustained attempt to obliterate the distinction between politics and mass entertainment; to stupefy the masses of uneducated lower-income whites who are transfixed by his apparent wealth and celebrity, his unabashed greed and contempt for anything that cannot be marketed and sold. So should we regard Trump as a kind of new fascist, using a mixture of kitsch, obscenity, and bombast to keep his followers rapt? Liberating the repressed, unconscious wishes of his supporters who are implicitly encouraged to enact symbolic and even physical violence against the perceived other?

The new fascism we are witnessing today should not be confused with the fascism of yesteryear. But perhaps it is no less dangerous in the long run, and conventional political wisdom is no more able to halt its progress. The antidote to the rise of populist politics based on distrust is in how we describe the disease itself. To view Trump simply as an aberration, a metaphysical monstrosity – which undoubtedly he is in some sense – is profoundly inadequate. We must see him as the symptom of a general disease; a disease which is global in nature, and which bears witness to the contradictions and antagonisms of the democratic capitalistic order.

*Dr. Sam Ben-Meir is professor of philosophy at Eastern International College. His current research focuses on environmental and business ethics.

The views expressed in this article do not necessarily reflect the views of TransConflict.

Brexit creates new opportunities and new risks for the British and EU financial markets. If policymakers react optimally, both could benefit. However, a more likely outcome is a fall in the quality of financial regulations, more inefficiency, more protectionism, and less protection. Systemic risk could increase, with a systemic vicious feedback loop a possibility.

By Jon Danielsson, Robert Macrae and Jean-Pierre Zigrand*

The UK vote on Thursday to leave the European Union will have widespread consequences for financial markets, creating both opportunities and problems. Much depends on how policymakers and market participants react, and there will be much to learn about the resiliency of financial markets and their regulation.

There is of course the potential for Brexit to increase financial stability.  Heterogeneity of financial markets and economic systems increases financial stability, as discussed here on Vox in 2013 (Danielsson 2013).  It makes financial shocks less likely to amplify into a systemic crisis, with the visible risk resulting from heterogeneous systems damping the growth of endogenous risk and the many minor fault lines helping to prevent system-wide fractures.

With the UK leaving the integrated European financial markets and its uniform regulatory structure, it could increase heterogeneity and efficiency of the financial markets on a global scale by making the British regulatory system more different from the European.

However, this may be optimistic. ‘Leave’ campaigners trumpeted Britain’s ability to design its own regulatory system as a major benefit of Brexit. But this has probably been exaggerated because most participants will need to trade in Europe and so will in effect be bound by both sets of rules, and because to some extent European regulations already reflect the UK’s approach due to London’s importance in European cross-border financial trade.

New risks

Markets are reflecting a substantial shock, and their initial reaction indicates both weak sterling and UK asset markets overall. The depreciation of sterling may well lead to inflation, particularly if the fall is sustained because insularity makes the pound less attractive to non-UK entities.

Does that matter from a systemic point of view?  It is tempting to say no – that markets are merely doing their job of discounting news, good or bad, and that the system will adapt and move on.  However, it is not that clear-cut and, while unlikely, the probability of a consequent systemic crisis is certainly not zero.

The stability of the British financial system and its rather fragile economic growth are dependent on the near-zero interest rates to the extent of this being an addiction.

The government is highly indebted; pension funds are underfunded; and the financial system has limited willingness to fund the small businesses likely to generate economic growth.  All this at a time when loan books are underpinned by real estate that has all been valued on the basis of a very depressed yield curve.

Under these circumstances it is not hard to imagine a bond buyers’ strike echoing that of the ‘Gnomes of Zurich’ who in the 1960s declined to entrust their assets to the UK. Given the very high sensitivity of bond values to inflation, as we will discuss in a forthcoming VoxEU column, a vicious feedback loop could ensue between a falling sterling, rising inflation, increasing yields, and falling bond prices. This could happen slowly over many years, or very quickly indeed if current bond holders are assuming they can insure their portfolios by selling as prices fall.

What options would the Bank of England have in this scenario?  Fund banks on ever-more generous terms, in the Chinese model, to maintain nominal real estate valuations and accept the resulting inflation?  Or refuse, triggering a collapse in real estate and widespread bankruptcies, followed by rather similar largesse spread among the survivors?

Europe

European policymakers have disliked three things about Britain’s financial sector: its objection to many European regulatory initiatives such as Mifid II, FTT, and bonus regulations; its insistence on remaining outside of the euro; and its size.  If the sector were small the other issues could be ignored, but it is not.

All of that will change, leaving Europe free to design the regulation it wants.

It seems obvious it will do so with an eye to competition from the City of London and will seek to enhance the roles of Frankfurt and Paris in European finance. It easily do so by crafting regulations that force certain activities to move to Europe and this temptation may prove hard to resist.

If EU strategies were to attract UK-based financial business that lead to different and larger risk-taking under the watch of regulators who have had insufficient time to develop the appropriate expertise, then systemic risk may increase.

Those contracts would not be written under UK law and would not have been tested or have the legal certainty they currently have. Finally, if the trading of those new securities and their clearing move out of the UK to the EU, CCP arrangements change, which may lead to new risks. Meanwhile, the transmission network of shocks changes also in unknown ways.

Furthermore, without a passporting-type arrangement, Brexit would curtail the sharing of financial information on a European level (e.g. Emir), making it impossible to construct a picture of Europe-wide risk exposures taken by financial institutions.

There is also a risk that the European financial system will be less able to play its role of efficiently allocating resources from savers to companies. Clearly CMU, for example, will lose a key advocate.

The UK, supported by smaller like-minded countries, has been a major proponent of a more liberal and diverse financial system in which banks’ overwhelming dominance can be reduced. The end result seems likely to be a more highly regulated and inefficient European financial market, freed from the discipline imposed by competition and relying on protectionism to maintain barriers to entry.  This does not bode well for European savers or for entrepreneurs, and the fact that asset prices fell across all of Europe is reflective of that fear.

The homogeneity of the European financial system will likely be increased.  If combined with more red tape and more protectionism it will lead to higher costs to consumers and also may increase systemic vulnerability.

Britain

Britain and Europe have fundamentally different approaches to regulation.  British regulation is based on common law, assumes that regulations should be applied only where a clear need has been demonstrated, and relies to a substantial extent on transparency and self-regulation.  The European approach, by contrast, is based on civil law and assumes that as much conduct as possible should be regulated in a prescriptive way.

The greater flexibility of the British approach has played a key role in London being the dominant cross-border financial centre within Europe.

Many British voters have a strikingly negative image of European regulation as over-prescriptive and impractical, but the record is in fact rather more mixed.  British policymakers have successfully opposed some areas of regulation that appeared excessive, for instance within Mifid II, but have also been largely responsible for regulations that appear to create new systemic risk where it did not exist before, such as the Solvency II insurance regulations.

If the UK policymakers are able to reach an agreement with the EU that allows continued access to the single market that somehow does not require the British exporters to stick to EU rules – a rather unlikely outcome – the hope is that they could craft a lightweight and nimble regulatory structure that would allow the British financial sector to continue to prosper with the European passport and be even more successful in winning over new markets.

A more likely looking outcome, though, is that policymakers achieve very little. The legislative and regulatory workload required to shift the entire legal basis of financial regulation from Brussels back to London is immense, so for many years, regulators will have to run to keep still.

Given the level of thoughtfulness of the arguments advanced prior to the referendum, it seems unlikely that the pro-Brexit camp and its lawyers have spent much time thinking about or preparing for this phase, despite having pushed for Brexit for many years.

Even when this workload subsides, obeying EU regulations will be the likely price of access to the European markets, and so for all but the purely domestic entities (which tend to be small) the landscape will change little.

At the same time, Britain will lose any ability to influence European regulations from the moment it invokes Article 50. It may well be that the best the UK can hope for is an EEA-type arrangement, where it is allowed access to the European markets at the expense of having to adopt European regulations without the ability to influence them.

If the UK does lose some of its financial sector to Europe, that will reduce its dependence on finance.  This obviously comes at substantial economic cost, but also has the potential to increase the resilience of the British economy, reducing systemic risk.  However, the UK banking system will remain very large compared to the rest of the UK economy.  The country’s overwhelming dependence on this single sector suggests the UK will continue have a substantial financial sector risk exposure.

Conclusion

In theory, the Brexit vote Thursday creates an opportunity for the UK to improve the resiliency, efficiency, and the quality of service of its financial markets. Unfortunately, it is more likely to induce regulatory paralysis due simply to the vast workload that has been created, so it is doubtful whether policymakers will be able to take this opportunity.

The likely scenario is for UK regulation to become more onerous, both due to what will effectively be dual regulation from both UK and EU, and also to the UK having to adopt much European regulation without the ability to influence it.

The City of London may also see a substantial erosion of its place as a major international finance centre.

In a worst case scenario, a vicious systemic feedback loop for the UK could ensue.

Europe, with its most liberal large country gone, is likely to sharply increase its regulatory intensity, with the focus on politics and protectionism rather than efficiency, resulting in a more costly, more homogenous and consequently less safe financial system.

All lose.

*About the authors:
Jon Danielsson, Director of the ESRC funded Systemic Risk Centre, London School of Economics

Robert Macrae

Jean-Pierre Zigrand, Associate Professor of Finance and Co-Director of the Systemic Risk Centre, LSE

References:
Danielsson, J. (2013), “Towards a more procyclical financial system”, 6 March.

Yes, Britain has decided to exit from EU, making the slogan ‘Brexit’ a reality. .

In a referendum, Britain voted to leave the European Union, forcing the resignation of Prime Minister David Cameron who sought Britain to remain in the European Union, and dealing the biggest blow to the European project of greater unity since World War –II. An emotional Cameron led the “Remain” campaign to defeat, losing the gamble he took when he called the referendum three years ago. EU chiefs said they expected the UK to begin negotiations to leave “as soon as possible, however painful that process may be”.

The UK PM had urged the country to vote ‘Remain’ but was defeated by 52% to 48% despite London, Scotland and Northern Ireland backing staying in. The referendum turnout was 71.8% – with more than 30 million people voting – the highest turnout at a UK-wide vote since 1992. “The British people have voted to leave the European Union and their will must be respected,” said Cameron. “The will of the British people is an instruction that must be delivered.” Speaking outside 10 Downing Street, he said “fresh leadership” was needed.

UKIP leader Nigel Farage hailed the historic vote as the UK’s “independence day”, while Boris Johnson, the ex-London mayor and public face of Vote Leave who is now a frontrunner to be next prime minister, said there was “no need for haste” about severing the British ties, he said the result would not mean “pulling up the drawbridge”. He is now widely tipped to seek his job. He said voters had “searched in their hearts” and the UK now had a “glorious opportunity” to pass its own laws, set its own taxes and control its own borders. Labor’s Gisela Stuart said the UK would be a “good neighbor” when it left the EU. Farage – who has campaigned for the past 20 years for Britain to leave the EU – told cheering supporters “this will be a victory for ordinary people, for decent people”. Labor leader Jeremy Corbyn, who called for the UK to remain in the EU but was accused of a lukewarm campaign, said poorer communities were “fed up” with cuts and felt “marginalized by successive governments”.

Following the victory of Brexit campaign, the United Kingdom itself could now break apart, with the leader of Scotland – where nearly two-thirds of voters wanted to stay in the EU – saying a new referendum on independence from the rest of Britain was “highly likely”. The British people have made the very clear decision to take a different path and as such I think the country requires fresh leadership to take it in this direction,” David Cameron said in a televised address outside his residence. “I do not think it would be right for me to be the captain that steers our country to its next destination,” Cameron added, appearing to choke back tears before walking back through the black door of No. 10 Downing Street with his arm around his wife Samantha. Cameron said he had informed the Queen of his decision to remain in place for the short term and to then hand over to a new prime minister by the time of the Conservative conference in October.

The vote led to crash of financial markets. The pound fell to its lowest level against the dollar since 1985 as the markets reacted to the results. Global financial markets plunged on June 24 as results from a referendum showed a near 52-48 percent split for leaving a bloc that Britain joined more than 40 years ago. The pound fell as much as 10 percent against the dollar to touch levels last seen in 1985, on fears the decision could hit investment in the world’s fifth-largest economy, threaten London’s role as a global financial capital and usher in months of political uncertainty. Also, world stocks headed for one of the biggest slumps on record, and billions of dollars were wiped off the value of European companies. Britain’s big banks took a $130 billion battering, with Lloyds (LLOY.L) and Barclays (BARC.L) falling as much as 30 percent at the opening of trade. Bank of England governor Mark Carney said UK banks’ “substantial capital and huge liquidity” allowed them to continue to lend to businesses and households. The Bank of England is ready to provide an extra £250bn of support, he added.

Johnson left his home to jeers from a crowd in the mainly pro-EU capital. He spoke to reporters at Leave campaign headquarters, taking no questions on his personal ambitions. “We can find our voice in the world again, a voice that is commensurate with the fifth-biggest economy on Earth,” he said. They wanted to make immediate changes before the UK actually leaves the EU, such as curbing the power of EU judges and limiting the free movement of workers, potentially in breach of the UK’s treaty obligations.

There was euphoria among Britain’s eurosceptics forces, claiming a victory over the political establishment, big business and foreign leaders including US President Barack Obama who had urged Britain to stay in. “Dare to dream that the dawn is breaking on an independent United Kingdom,” said Nigel Farage, leader of the eurosceptic UK Independence Party, describing the EU as “doomed” and “dying”. “This will be a victory for real people, a victory for ordinary people, a victory for decent people … Let June 23 go down in our history as our independence day.”

European politicians reacted with dismay. “It looks like a sad day for Europe and Britain,” said German foreign minister Frank-Walter Steinmeier. “Please tell me I’m still sleeping and this is all just a bad nightmare!” former Finnish Prime Minister Alexander Stubb tweeted. The shock hits a European bloc already reeling from a euro zone debt crisis, unprecedented mass migration and confrontation with Russia over Ukraine. Anti-immigrant and anti-EU political parties have been surging across the continent, loosening the grip of the center-left and center-right establishment parties that have governed Europe for generations. French National Front leader Marine Le Pen called for a similar referendum in France changed her Twitter profile picture to a Union Jack and declared “Victory for freedom!”

Quitting the EU could cost Britain access to the EU’s trade barrier-free single market and means it must seek new trade accords with countries around the world. The EU for its part will be economically and politically damaged, facing the departure not only of its most free-market proponent but also a member with a U.N. Security Council veto, a powerful army and nuclear capability. In one go, the bloc will lose around a sixth of its economic output. “It’s an explosive shock. At stake is the break up pure and simple of the union,” French Prime Minister Manuel Valls said. “Now is the time to invent another Europe.” The result emboldened eurosceptics in other member states, with populist leaders in France and the Netherlands demanding their own referendums to leave.

Britain is set to be the first country to leave the EU since its formation – but the Leave vote does not immediately mean Britain ceases to be a member of the 28-nation bloc. The EU referendum seems to have revealed an ancient, jagged fault line across the United Kingdom. It is a scar that has sliced through conventional politics and traditional social structures, and it is far from clear whether the kingdom can still call itself united

The government will also have to negotiate its future trading relationship with the EU and fix trade deals with non-EU countries. In Whitehall and Westminster, there will now begin the massive task of unstitching the UK from more than 40 years of EU law, deciding which directives and regulations to keep, amend or ditch.That process could take a minimum of two years, with Leave campaigners suggesting during the referendum campaign that it should not be completed until 2020 – the date of the next scheduled general election.

The vote will initiate at least two years of divorce proceedings with the EU, the first exit by any member state. Cameron – who has been premier for six years and called the referendum in a bid to head off pressure from domestic eurosceptics – said it would be up to his successor to formally start the exit process.

There will be job consequences as a result of this decision. EU Parliament president Martin Schulz called for a “speedy and clear exit negotiation”.

In Paraguay, religious culture consisting of rites and customs of the past, such as the notion of “ñande mboriahu” (we the poor), imposes a fatalistic mentality of mystic thinking, which employs the power of saints, fortune and progress, and ignores the values of self-esteem and intellectual potential of every individual as well as underestimates the incentive and efforts of rural Paraguayans. The search of land without evil (“maraney”) of the indigenous culture perhaps explains the tendency of abandoning places, in search of a better opportunity, that does not depend upon the individual’s potential but on the imaginary and mystic powers that one encounters spiritually.

According to Archbishop Sinforiano Bogarín “in a nation with a mentality of special perseverance, before anything else its people prefers good assurances” so that Paraguayans should proceed as Neufeld would state in his book, “fortiter et suaviter,” therefore God has destined these people to stay at home, work and obey. Neufeld raises a legitimate question, whether this statement is not even oriented towards some variations of slavery, apparently not only the miscegenation had its effects in the conduct of Paraguayans, but it was also reinforced through the kind of thinking from proper institutional leadership that is typical of closed and dominated societies.

Paraguayans in their tribal culture always link the image of the leader with power, this explains many of their leadership style showcased in a working environment, including relations with their superiors, and in relation to their subordinates, embodying a strong culture influenced by popular religion and folklore shaped by myths, superstitions, that impose a perception of fatalistic resignation and of permanent dependency.

Tribal culture recognized only a single authority, the “mburuvicha” or the leader, which carries the role of being the father or namely “ru” in Guarani. Such an environment perhaps highly generates the great dependence of Paraguayans and instills in them a significant lack of initiative, lack of “entrepreneurship” or entrepreneurial capacity.

In Paraguay’s tribal culture all are considered equal, but there is one “mburuvichá”; no one can give an order to his subordinates, with the only exception of the recognized leader, the President, therefore we see strong ties between the leader and his potential to exert a recognized set of powers. Tribal Culture has a number of disadvantages in the present world.

1. No one understands the moral dimension of a government entity. The government for the tribesman is absolutely unnecessary, the law is in force, but what matters is the usual customs, this produces ignorance towards knowing the laws. Therefore it is valuable to mention the strongman’s law, known in Paraguay as “la ley del mbareté” (The law of the strongest).
2. The fact that tribesmen are uncomfortable to act upon their own and always depend on the procedural guidelines ordered by their chief, is a recipe that prevents innovation, forward looking attitude and one’s vision for the future. The leadership authority in a tribe resides in personality and not in a structure itself.
3. Tribal life is overall much simple, frugal, without any other aspirations besides living in peace and with basic amenities and clothes. This includes the tendency of contemplation, conformity with limited resources, and the inertia of the past in the Paraguayans’ attitudes.
4. Team work and dialogue is almost impossible to effectively implement in Paraguay’s government offices or in any other hierarchical environment. The only one who has the status of being unequal to the rest of the population is the “mburuvicha” (Commander in Chief); in today’s context is the President of the Republic. Everyone else owns its own actions, and difficult to work in a team.

Paraguayan society is not only a tribal oriented society but also it is known to be a closed society. As Karl Popper has noted, “closed societies are restrictive, intellectually starving, and most of their people excert authoritarian attitude.”

This is why the Paraguayan society is of great concern towards fostering its messianic leaders of the XXI century that ought to reinforce the magic thinking of solving problems and instant practical thinking. Eradicate the attitude of dependence, and promote intellectual innovation – thinking of how to become an active participant and not simply a follower; to be the owners of each ones’ present and control the fate of their future.

Social welfare and dependence on overall government assistance, brings back the ideas of Victor Emil Frankl, the architect of logo therapy, who said that “he who depends on government support and gratuities, cannot be free, on the contrary, he depends on others and neither owns his future nor his present.

The analysis of a study conducted by Alejandro Vial (2006) “Political culture and democratic governance. Tension and uncertainty between the gaps of old and new dreams” shows the adherence of 86 percent of Paraguayans who trust the Catholic Church, and only 27.2 percent trust the National Government.

These statistics, may explain that Paraguayans are tired of long lasting negligence, deception and broken promises by their previous governments and in the ballots of April 21st, 2013, general elections entrusted a person who is not a typical politician, indeed he is the wealthiest man of Paraguay; and this magical thinking makes you elect a president whose origins are rooted in spiritualism, religious worshiping and in employing over five thousand Paraguayans in his family of companies.

Almost three years after President Horacio Cartes swore in as president of Paraguay, Asuncion continues to experience serious challenges on its struggle against corruption and organized crime as well as in its efforts to promote a transparent, ethical justice system and rescue the national education system.

The Toro Kandil of Paraguay must confront head on the rising poverty levels, poor education infrastructure system, poor training of its educators and human talent. Additionally, Asuncion should gather all its energies in order to make Paraguay a premier logistical hub of South America therefore crushing its mindset and stop being a prisoner of geography. The presidential palace named after the son of Carlos Antonio Lopez (Paraguay’s first constitutional president), Francisco Solano Lopez, the emblematic office of President Cartes; has to improve its effectiveness on public policy programs that have been ignored during the last twenty six years of democratic governments, in order to uphold and evoke the admirable economic progress that Paraguay had accomplished during the administration of President Lopez in the 1850s.