Adam Schiff hopes to fight Donald Trump with facts

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ONLY A PARTISAN Republican could describe the congressman for Tinseltown as a “Hollywood liberal”. Though socially liberal, Adam Schiff, a 58-year-old former federal prosecutor, is a fiscally sensible moderate with national-security chops. He is also, despite being the likely next chairman of the House intelligence committee, hardly anyone’s idea of box office.

As the ranking Democrat on a committee that has degenerated to dog-eat-dog partisanship and conspiracy-mongering under Devin Nunes, Mr Schiff has been much provoked in the past 18 months. He remains relentlessly measured and low-key. A look of pained consternation, over his Republican colleagues’ latest attack or intelligence leak, is as animated as he gets. “I think they will have a lot to answer for when this chapter of history is written,” he says, more in sorrow than rage. Yet Mr Schiff, though neither charismatic nor fiery, qualities that some Democrats think indispensable to resisting the president, will soon lead that effort.

He will be responsible for holding Donald Trump to account on the president’s main vulnerability: his dealings with Russia. In part this will mean backing Robert Mueller’s investigation into Russia’s effort to get Mr Trump elected. Mr Nunes has tried to obstruct and discredit the special counsel. Mr Schiff will provide him with testimonies gathered by the committee’s own Russia investigation, which Mr Nunes has refused to release.

He also means to continue the committee’s probe. Indeed, though its Republican contingent prematurely declared the inquiry over, he and his Democratic colleagues never stopped investigating. With control of the committee’s staff and subpoena power, which House committees, unlike the more collegial Senate, reserve for the majority party, their effort will soon be more imposing. “The highest priority will be not to reinvent the wheel but to look at investigating threads the Republicans stopped us looking at,” he says. “There are any number that were in the category of conspiracy or collusion that we were not able to pursue.”

This points to the main danger for House Democrats bent on applying oversight to the administration. It has generated such a lot of sleaze and intrigue—also including the conflicts of Ryan Zinke and Wilbur Ross, the policy blunders at the borders and in Puerto Rico, the president’s attacks on governing norms—that the watchdogs will simply have too much to grapple with. The temptation will be to spread themselves too thinly and lose focus on what matters most. That would also turn off ordinary Americans. Having little interest in the details of 47 different Trump scandals, many would view the Democratic onslaught, however justified, as over-egged and needlessly partisan. Mr Trump, by fulminating against witch-hunts and firing off fictitious accusations against his accusers, would encourage and be strengthened by that.

By the same token, Mr Schiff’s effort to reinvigorate the House investigation, despite Mr Mueller’s ongoing investigation, could look gratuitous to a public that has little interest in the Russian plot. That would be wrong, given the seriousness of Russia’s attack, and worrying, given the likelihood of a repeat. Yet it could happen, and in that case Mr Schiff would end up politicising the special counsel’s more high-powered investigation even more than it already has been. Mr Trump would waste no time in framing Mr Schiff and Mr Mueller as conspirators in a liberal vendetta.

He acknowledges some of these risks: “The president is going to fight oversight tooth and nail, which means we must pick and choose our fights.” He says he will focus his investigation on allegations surrounding Russian payments to Mr Trump’s company before he was elected. Neither the House nor Senate probes looked at this, though many believe it could help explain Mr Trump’s cravenness towards Vladimir Putin. Mr Schiff says the allegations may turn out “more compromising than any salacious videotape”.

He believes the special counsel has not looked at them either, but even if he has, he says there is little danger he will muddy the water between his probe and Mr Mueller’s. Congressional oversight, tarnished by House Republicans, is both important in itself and fundamentally different from the special counsel’s brief, he says. Mr Mueller has a mandate to investigate crimes. Having done so, he could choose not to release his findings. Congressional oversight, by contrast, is as much about bringing the truth to light as miscreants to book: “The public deserves an accounting.”

Mr Schiff’s eagerness to prioritise also suggests he has taken a lesson from his Republican tormentors. He is a veteran of one of the eight Republican investigations into Hillary Clinton’s alleged culpability for the deaths of American diplomatic staff in Benghazi in 2012. It was a bogus charge: she had no direct responsibility. Yet in the process of devoting hours of airtime and millions of dollars to it, the Republicans raised doubts about Mrs Clinton’s integrity which helped deny her the presidency. With so many real scandals to choose from, the Democrats need to focus not only on the most serious but also, as the Republicans did, on what seems most indicative of their opponent’s character. Mr Trump’s alleged malfeasance fits that bill.

You say subpoena

Sticking it to him in this way might placate Democratic activists who want to impeach the president, which the party’s leadership, including Mr Schiff, does not want: “There’s only one thing worse than putting the country through the wrenching experience of an impeachment, and that’s a failed impeachment”. It would also indicate that Mr Trump is better opposed with fact and reason, the grounds he cannot compete on, than fire and nonsense.

This is why Mr Schiff, calm and rigorous, looks like an effective opponent for Mr Trump. It is also why the president’s effort to tar him as “Sleazy Adam Schiff” fell flat. The only association with sin that clings to Mr Schiff, a marathon-running vegan, relates to the fact that his wife is called Eve.

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A new museum captures Austria’s ambivalence about its past

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MODERN AUSTRIA turned 100 on November 12th and, as a present, gave itself a history museum. Its first exhibition includes a towering wooden horse that sports the brown cap of Hitler’s Sturmabteilung (SA). The Waldheim-Pferd, or Waldheim Horse, was first seen at demonstrations in 1986, when Kurt Waldheim ran for the country’s presidency, playing down his role in the Wehrmacht during the second world war and claiming he had never joined any Nazi organisation. His opponents joked that only his horse had been a member of the SA.

Waldheim won the election, but Austria was changed for ever. “It was the end of the era in which Austria only saw itself as a victim of Hitler’s aggression,” says Georg Hoffmann, a curator at the House of Austrian History, the new museum, which occupies a set of rooms in Vienna’s imperial Hofburg palace. “It was the first time Austria openly debated its co-responsibility for Nazi crimes.” Wehrmacht records are on display near the horse, which show that Waldheim had indeed been a member of the same outfit as his mount.

Austria may have changed in the Waldheim era, but not every Austrian changed with it. Views on the country’s past remained divided, which helps explain why it took 20 years for the idea of a national history museum to come to fruition. (This was just the most recent incarnation of the scheme: the first push for a museum began in 1946.) Austria’s Social Democrats secured the founding of the institution in 2016, while in coalition with the centre-right People’s Party. The latter, now in government with the far-right Freedom Party, honoured this commitment, albeit on a temporary basis. State funding is guaranteed only until the end of next year (though Austria’s parliament has suggested that it may stump up some cash beyond that).

In a sense, then, the House of Austrian History is its own best exhibit, and the most fitting 100th-birthday present the country could receive: a project almost as vexed as the story it tells, and as precarious as the statehood it commemorates has sometimes been.

The myth of victimhood

Like several other European countries, the Austrian Republic was born as the first world war ended, formed from the rump of the 600-year-old Habsburg empire that Czechs, Hungarians, Poles and Slovenes had not claimed for their own nation-states. Most Austrians saw Austria as an aberration, cut off from its wheat in the east, its port on the Adriatic and the industry of Bohemia; the Allies denied their wish to join a “greater Germany”. 

These problems of national identity were compounded by severe economic difficulties, and were ultimately followed by the Anschluss of 1938, in which Austria’s own authoritarian government was overrun by Nazi Germany, to the jubilation of millions of its people. Despite the horrors that this greater Germany then inflicted on its neighbours and the world, the Allies in 1943 declared Austria the “first free country to fall victim” to the Nazis. Their hope was to stoke resistance to Hitler, but the revisionism also led to what the post-war Austrian left called the “victim myth”.

“Austria successfully defended this ‘victimhood narrative’ when dealing with the Allies after 1945,” says Anton Pelinka, a political scientist. Victim status enabled the country to differentiate itself from Germany—but it also made it easier for governments to allow former Nazis to take part in the new democracy. “That was the foundation of revelations like those about Waldheim years later,” says Mr Pelinka.

All Austrians were victims; all Austrians were Nazis: these competing simplifications are at the root of Austria’s ambivalence about its past. The museum acknowledges that tension frankly. What, for instance, to call the authoritarian era of Engelbert Dollfuss and Kurt Schuschnigg from 1933 to 1938? The country’s left for years referred to it as Austro-Fascism, the right as the Corporate State. The museum displays these and other terms, and plumps for the “Dollfuss-Schuschnigg Dictatorship”, at least for now.

“We see ourselves as a forum for debate,” says Monika Sommer, the director. “We are quite comfortable with showing that there isn’t always one view on history.” She hopes that exhibits like the Waldheim-Pferd will prove to be “friction points” that galvanise discussion. There are bound to be controversies, she acknowledges. The museum’s aim is to provide a stage on which to air them, perhaps even to forge a new consensus.

As the House of Austrian History documents, the distortions go all the way back to the beginning. The museum shows how “the state nobody wanted”, as Hellmut Andics, a well-known writer, described the republic of 1918, deserved more esteem and, after the disgrace of Nazism and Austria’s post-war recovery, eventually got it. Some of the republic’s first laws made generous provision for the war-wounded, adumbrating modern Austria’s munificent welfare state. Parts of the constitution of 1920 were incorporated into the current version.

A recent preview at the museum was attended by members of Vienna’s Jewish community. One of them, Awi Blumenfeld, a teacher whose parents survived Auschwitz, enjoyed the Waldheim-Pferd, which he saw as a symbol of Austria’s divisions, and a reminder that lies are unsustainable. (The liberal political group that owns the horse has the right to reclaim it if it disagrees with the curators’ approach.) Mr Blumenfeld was sure the museum will secure long-term funding. After all, even the present right-wing government “understands that we need a national narrative that goes beyond Mozart.”

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The next capitalist revolution

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CAPITALISM HAS suffered a series of mighty blows to its reputation over the past decade. The sense of a system rigged to benefit the owners of capital at the expense of workers is profound. In 2016 a survey found that more than half of young Americans no longer support capitalism. This loss of faith is dangerous, but is also warranted. Today’s capitalism does have a real problem, just not the one that protectionists and populists like to talk about. Life has become far too comfortable for some firms in the old economy, while, in the new economy, tech firms have rapidly built market power. A revolution is indeed needed—one that unleashes competition, forcing down abnormally high profits today and ensuring that innovation can thrive tomorrow.

Countries have acted to fuel competition before. At the start of the 20th century America broke up monopolies in railways and energy. After the second world war West Germany put the creation of competitive markets at the centre of its nation-building project. The establishment of the European single market, a project championed by Margaret Thatcher, prised open stale domestic markets to dynamic foreign firms. Ronald Reagan fostered competition across much of the American economy.

A similar transformation is needed today. Since 1997 market concentration has risen in two-thirds of American industries. A tenth of the economy is made up of industries in which four firms control more than two-thirds of the market. In a healthy economy you would expect profits to be competed down, but the free cashflow of companies is 76% above its 50-year average, relative to GDP. In Europe the trend is similar, if less extreme. The average market share of the biggest four firms in each industry has risen by three percentage points since 2000. On both continents, dominant firms have become harder to dislodge.

Incumbents scoff at the idea that they have it easy. However consolidated markets become domestically, they argue, globalisation keeps heating the furnace of competition. But in industries that are less exposed to trade, firms are making huge returns. We calculate the global pool of abnormal profits to be $660bn, more than two-thirds of which is made in America, one-third of that in technology firms (see Special report).

Not all these rents are obvious. Google and Facebook provide popular services at no cost to consumers. But through their grip on advertising, they subtly push up the costs of other firms. Several old-economy industries with high prices and fat profits lurk beneath the surface of commerce: credit cards, pharmaceutical distribution and credit-checking. When the public deals with oligopolists more directly, the problem is clearer. America’s sheltered airlines charge more than European peers and deliver worse service. Cable-TV firms are notorious for high prices: the average pay-TV customer in America is estimated to spend 44% more today than in 2011. In some cases public ire opens the door to newcomers, such as Netflix. Too often, however, it does not. Stockmarkets value even consumer-friendly entrants such as Netflix and Amazon as if they too will become monopolies.

Rising market power helps solve several economic puzzles. Despite low interest rates, firms have reinvested a stingy share of their bumper profits. This could be because barriers to competition keep out even well-funded newcomers. Next, since the turn of the millennium, and particularly in America, labour’s share of GDP has been falling. Monopolistic prices may have allowed powerful firms to eat away at the purchasing power of wages. The labour share has fallen fastest in industries with growing concentration. A third puzzle is that the number of new entrants has been falling and productivity growth has been weak. This may also be explained by a lack of competitive pressure to innovate.

Some argue that the solution to capital’s excesses is to beef up labour. Elizabeth Warren, a possible American presidential candidate, wants to put more workers on boards. Britain’s Labour Party promises compulsory employee share-ownership. And almost everyone on the left wants to reinvigorate the declining power of unions (see Briefing). There is a role for trade unions in a modern economy. But a return to 1960s-style capitalism, in which bloated oligopolies earn fat margins but dole cash out to workers under the threat of strikes is something to be avoided. Tolerating abnormal profits so long as they are distributed in a way that satisfies those with power is a recipe for cronyism. Favoured insiders might do well—witness the gap between coddled workers and neglected outsiders in Italy. But an economy composed of cosy incumbents will eventually see a collapse in innovation and hence a stagnation in living standards.

Far better to get rid of rents themselves. Market power should be attacked in three ways. First, data and intellectual-property regimes should be used to fuel innovation, not protect incumbents. That means liberating individual users of tech services to take their information elsewhere. It also entails requiring big platforms to license anonymised bulk data to rivals. Patents should be rarer, shorter and easier to challenge in court.

Second, governments should tear down barriers to entry, such as non-compete clauses, occupational licensing requirements and complex regulations written by industry lobbyists. More than 20% of American workers must hold licences in order to do their jobs, up from just 5% in 1950.

Third, antitrust laws must be made fit for the 21st century. There is nothing wrong with trustbusters’ remit to promote consumer welfare. But regulators need to pay more attention to the overall competitive health of markets and to returns on capital. America’s regulators should have more powers, as Britain’s do, to investigate markets that are becoming dysfunctional. Big tech firms should find it much harder to neutralise potential long-term rivals, as Facebook did when it acquired Instagram in 2012 and WhatsApp in 2014.

These changes will not solve every ill. But if they drove profits in America to historically normal levels, and private-sector workers got the benefits, real wages would rise by 6%. Consumers would have greater choice. Productivity would rise. That might not halt the rise of populism. But a competition revolution would do much to restore the public’s faith in capitalism.

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How does a leadership challenge work in the Conservative Party?

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AFTER HER proposed Brexit deal triggered a flurry of government resignations, Theresa May’s job is on the line. The British prime minister faces a potential leadership challenge. Speaking to a crowd of gawping journalists and curious tourists outside the Houses of Parliament on November 15th, Jacob Rees-Mogg (also pictured), an influential backbencher, demanded a confidence vote in the prime minister. He is not the only one to have done so. But how would Conservative MPs go about removing Mrs May? And how would they choose her successor?  

Under the Conservative system, a confidence vote is triggered when 15% of Tory MPs send letters of no confidence to the chair of the 1922 Committee, which represents Conservative MPs in parliament. The party has 316 MPs, so 48 have to write in. All Conservative MPs may vote in the ballot, with the result dictated by a simple majority. This can happen quickly: in 2003, the confidence vote came only a day after it was triggered. If Mrs May wins, she stays on as leader. As an added bonus, another challenge cannot be launched for a year. If Mrs May loses, she would no longer be Conservative leader. Selecting a new leader would then involve two rounds. First, the candidates must win the votes of fellow MPs. The candidates stand against each other in consecutive rounds of votes, with the candidate in last place getting eliminated each time, until only two remain. These two names are then put forward to the estimated 130,000 members of the Conservative Party. They are the happy few who would have a direct say on Britain’s next prime minister. 

Britain, then, can change prime minister without the bother of a general election. It is relatively common. Mrs May took over from David Cameron in this way. So did Gordon Brown, who succeeded Tony Blair as leader of the Labour Party and thus prime minister in 2007. The head of the largest political party is asked by the Queen to form a government however they ended up in that position. 

Mrs May might discern some light in the gloom. It is one thing to muster 48 MPs fed up with the prime minister. But it is quite another to persuade 158 to vote against her, with no obvious successor in the wings. Another Conservative prime minister would face exactly the same problems as Mrs May: a divided party, a weak hand in Brussels and a split country. If Mrs May wins the no-confidence vote, her immunity from a future challenge would provide some political leeway. In that time, she may somehow push her deal—or a version of it—through Parliament. Her prospects and those of her party may look better in a year. But MPs may not want to find out. Those who are supportive of the prime minister in public may express a different view in the privacy of a voting booth.

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The trial of El Chapo and the crime-fighting plan of AMLO

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CHIEF AMONG the signs that not all is well in Mexican law enforcement is the trial of the country’s most wanted man. It began this week in New York, because each time Mexican authorities locked up Joaquín “El Chapo” Guzmán, allegedly the boss of the Sinaloa drug gang, he escaped. After his third capture, in 2016, Mexico extradited him to the United States. That has not reduced bloodshed in Mexico. As the accused kingpin stood in the dock, Mexico’s president-elect, Andrés Manuel López Obrador, known as AMLO, unveiled a plan that he said would end a misguided, decade-long war on drugs.

The subject of ballads and gory television series, El Chapo provokes fear even in New York. A juror broke down in tears upon learning of her selection for the trial. Prosecutors accused him of smuggling 150,000kg (330,000 pounds) of cocaine into the United States. But his lawyer insisted that there had been a mix-up. Mr Guzmán was never in charge of Mexico’s biggest drug-trafficking gang, he said.

Instead, he accused Ismael Zambada, another gang member, of running the show, alleging that Mr Zambada paid Mexico’s two most recent presidents, Felipe Calderón and Enrique Peña Nieto, millions of dollars to pursue the Sinaloa gang’s rivals. Both presidents vehemently deny the accusations. Nonetheless most Mexicans, made cynical by corruption, do not have much trouble believing them. But allegations by Mr Guzmán himself, who was captured after boasting to Sean Penn, an American actor, that he was the world’s biggest drug trafficker, may not be reliable.

Many analysts think the capture of Mr Guzmán and other drug bosses made violence in Mexico worse. Large gangs fragmented and trigger-happy lieutenants fought for leadership. Such feuds helped drive the murder rate to a record high in 2017, which is certain to be surpassed this year.

On November 14th Mr López Obrador, who will become president at the beginning of next month, announced his plans to deal with the crisis. His eight-point proposal restates campaign promises to end corruption and poverty and recasts the consumption of drugs as a public-health issue. His much-touted “amnesty” for some criminals appears to include scope for reducing the sentences in exchange for co-operation with authorities and reparations for victims. The plan also contains a vow to abjure torture. It is unclear whether any of this will bring the murder rate down.

Mr López Obrador’s most controversial idea is the creation of a national guard under the control of the army. This would require changing the constitution, under which all public-security institutions are subject to civilian control. In 2006 Mr Calderón deployed the army to fight drug gangs. Mr López Obrador described the deployment as a failure. Now he seems to accept a policing role for the army. “In the end politics is about choosing between inconveniences,” he said at the plan’s unveiling.

Absent from it is any proposal to strengthen the state and municipal police forces that do most of the law enforcement, or any mention of how the next administration might implement a criminal-justice reform that has already begun. More attention to those areas would bolster the state that Mr Guzmán helped undermine.

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The Greek Orthodox Church faces a battle over secularisation

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THERESA MAY is not the only public figure in Europe who is making a rearguard defence of a “historic” agreement about an ultra-sensitive matter that was struck behind closed doors and may not survive open debate among the interested parties.

Earlier this month it was reported that a landmark accord had been reached to secularise the most theocratically governed democracy in Europe, Greece. The bargain was sealed on November 6th between the country’s leftist and atheist (though not especially anti-religious) prime minister, Alexis Tsipras, and the head of the Greek Orthodox church, Archbishop Ieronymos. Today the archbishop was struggling to defend the accord before the bishops who make up his Holy Synod. It has been billed as the hardest moment in the 80-year-old cleric’s ten-year reign, and even a turning point in the 200-year history of the Greek state.

The deal is certainly an intriguing piece of political gamesmanship. One provision dominated the headlines: the country’s 10,000 or so priests would no longer be considered civil servants, with all the job security and pension rights that go with that status. Instead the state would pay the church an annual subsidy of €200m ($230m) a year, a sum that would not be affected by any change in the number of clerics. Over time, the need for such a subsidy would diminish. In what was described as a win-win arrangement, a large portfolio of properties, ranging from land to urban real estate, whose ownership had been disputed between church and state since the 1950s would be jointly managed for the benefit of both parties.

As part of the deal, the archbishop agreed that the church would not oppose some constitutional amendments proposed by the ruling Syriza party which water down, but by no means eliminate, the rights and privileges of the Orthodox religion. In one important change, article 3 of the constitution would begin with a new formula: “The Greek state is religiously neutral.” Yet the remainder of the article will still include plenty of old-time religion; the new text specifies inter alia that:

“The prevailing faith in Greece is the Orthodox Church, which is inextricably united with the Ecumenical Patriarchate of Constantinople and with every other Orthodox church….” 

Even if the mildly secularising amendments (which require approval from 60% of legislators in two successive parliaments) go through, the constitution would still begin with the sonorous words, “In the name of the Holy, Consubstantial and Indivisible Trinity…” These words reflect doctrinal principles about the nature of God, a single Deity in three Persons, which were hammered out by church councils in the fourth and fifth Christian centuries.

Nor would the amendments change the provision that the purposes of state education in Greece must include “the development of national and religious consciousness”. In practice this means celebrating both the glories of ancient Greece and the subtleties of Greek Orthodox teaching. Greece’s Humanist Union has denounced the changes as window-dressing and deplored the fact that humanists in other countries, like Britain, rushed to praise the deal.

The one thing that would definitely alter, under the proposals, is that the Archbishop of Athens would have more power over the church as a whole, and local bishops might have more power over the priests under their sway. But bishops seem untempted by any tactical advantage that the deal might give them. At the Holy Synod session on November 16th, they flatly rejected any change in the system of wage-payments to priests or other employees of the church. They said all other church-state matters (presumably including property and the constitution) could remain under discussion, and a new panel of bishops, priests and legal advisers should be appointed to offer their expertise. Two bishops walked out of the stormy discussion.        

So this was a fairly bad day for the archbishop, who had hoped to get the entire deal approved in principle. Another complication is that Archbishop Ieronymos does not have direct authority over the whole Greek Church. In Crete and the Dodecanese Islands, the church is directly under the aegis of the Istanbul-based Ecumenical Patriarch; across a big swathe of northern Greece, authority is shared contentiously between the Istanbul-based and Athenian hierarchs. Patriarch Bartholomew in Istanbul, who is fighting a separate battle with his Russian counterpart over Ukraine, has told the Syriza government that he must be consulted about any changes that affect clerics and faithful under his sway.        

Like almost everything else in Greece, debates over the future of the church are likely to be embroiled in left-right electoral politics.  Next year there will be a bitter contest between Syriza, presenting itself as the party which guided Greece out of austerity, and New Democracy, the centre-right opposition which includes a deeply traditionalist wing that often makes common cause with the church. Relations between the church and the political right have been strengthened recently as they joined in protesting against a deal made by the government over the name of the country’s northern neighbour. (They insist the government has made too big a concession in allowing the neighbour to call itself Northern Macedonia.)

Already, bishops are playing the patriotic card in opposition to the “secularising” proposals. Seraphim, the ultra-conservative bishop of the port of Piraeus has said church and nation need to stand together at a time when Greece faces geopolitical threats.

If Mrs May had been sitting on today’s episcopal shouting-match, she (a vicar’s daughter) would instantly have empathised with the hapless archbishop’s predicament.

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Obama-Trump voters turn back to Democrats

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AMONG the many ways that Donald Trump has transformed American politics is by rearranging the country’s electoral map. In 2016 he broke through the “blue wall” that the Democrats fancied themselves to enjoy in the upper Midwest, winning three states with large populations of white voters without college degrees—Wisconsin, Michigan and Pennsylvania—that had not supported a Republican for decades. He also set record lows for a Republican presidential candidate’s performance in areas with higher levels of schooling, such as Orange County, California. This proved to be a prudent trade in the presidential race: the higher-education regions that repudiated him were clustered in uncompetitive states like Texas and California, whereas the lower-education ones that embraced him were concentrated in hotly contested battleground states.

In the 2018 mid-terms, however, Mr Trump’s party appears to have been stuck with all of the electoral costs of this strategy and none of the gains. Whites with college degrees still flocked to the Democrats: Orange County, previously home to four House Republicans, is expected to send none to the next Congress. However, many of the regions that defected from the Democrats to support Mr Trump in 2016 returned to their liberal roots this year.

Recently released vote breakdowns of Senate races by county show a clear “boomerang” pattern. The more ground Hillary Clinton lost in a county in 2016 relative to Barack Obama’s performance in 2012, the more ground Democratic Senate candidates picked up in 2018 compared with her vote shares. In many cases, the reversal was nearly complete: on average, counties that “swung” from the Democrats to the Republicans by around ten percentage points from 2012-16 shifted nine points back towards the Democrats from 2016-18. Most of these counties were in the Midwest, which has emerged as America’s most politically fickle region.

Democrats cannot rest on their laurels for long. Even in a “wave” election in which voters flocked to the polls to reject the unpopular president, incumbent senators in Ohio and Michigan were only re-elected by mid-single-digit margins, while those in Indiana and Missouri were defeated handily. In a less favourable political environment for the party—which, barring an economic slowdown, the 2020 presidential campaign is likely to feature—it might be the Democrats’ turn to suffer whiplash from these “swingiest” of counties.

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Why America struggles to sell LNG in Europe

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LAST WEEK Rick Perry, America’s energy secretary, went to eastern Europe to try to sell his country’s liquid natural gas (LNG). In Warsaw he announced a 24-year contract with Poland’s state gas company, PGNiG, under which it will receive 40.95bn cubic metres of gas from an American supplier, Cheniere Energy. Mr Perry said the deal was “a signal across Europe that this is how your energy future can be developed”. In Berlin on the same day Peter Altmaier, Germany’s economy minister, met Alexey Miller, the CEO of Gazprom, Russia’s gas giant. As the two discussed increasing imports of Russian gas to Europe via Nord Stream 2, a controversial pipeline from Russia to Germany that travels through the Baltic sea, they described a very different future from that envisaged by Mr Perry.

European countries are dealing with heightened energy-security worries. Demand for gas in Europe has risen since 2015, thanks in part to the global economic recovery and the favouring of more environmentally friendly gas-fired power plants. According to the International Energy Agency (IEA), an inter-government agency, total demand in Europe (which in the IEA’s definition excludes Russia) reached 613bn cubic meters (bcm) last year. The IEA expects it now to stabilise, and indeed to fall very slightly by 2040. But with gas production dwindling in non-Russian Europe, the region is increasingly reliant on imports, particularly from Russia, which already provides 35% of its supply. The precariousness of the situation was made plain in 2006 and 2009, when Russia temporarily interrupted the transport of gas through Ukraine, causing shortages in several countries. European leaders began looking for alternative gas supplies, including American LNG.

America is the world’s largest producer of natural gas and is on track to become the dominant exporter of LNG, thanks in part to soaring demand from South America and Asia. But the big problem with its LNG, as far as European buyers are concerned, is that it is more expensive than pipelined gas from Russia. American LNG exporters need to sell in Europe for at least $6-7 per million British thermal units (mBTU) to cover the costs of freezing, shipping and re-gasification. By contrast Russia’s long-run marginal cost of supply to Europe is only about $5 per mBTU. American LNG is also more expensive than LNG from Qatar and some African countries because feed gas in America is more costly to extract, and the distances it has to travel to the customer are longer.

Last year, as a result, Europe imported eight times more gas by pipeline than in the form of LNG, according to the US Energy Information Administration. This trend appears to be continuing into 2018. Imports of Russian gas by countries in the European Union hit a record high in the first half of the year, up 8% year-on-year. The threat of competition from America has forced Gazprom to become more efficient and to lower prices. So American LNG is actually more likely to end up in Asia, where Australia and Qatar sell a lot of LNG but are unable to meet growing demand. China, the main driver of that growth, has become a particularly important destination. Ensuring that President Donald Trump’s trade war with China doesn’t close off this market is more important to American LNG suppliers than any deal signed in Europe.

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Britain’s government slides into chaos

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NOBODY CAN accuse Theresa May of an unwillingness to repeat herself. The woman who said, again and again, that “Brexit means Brexit” is now telling Britain that her version of Brexit is the only version worth having. This morning the prime minister spent three hours extolling her deal to the House of Commons. This evening she spent a mercifully shorter period addressing the country via a press conference. Mrs May claims that her version of Brexit does two hard-to-deliver things. It respects the result of the 2016 referendum by taking back control of Britain’s borders, ending the free movement of people. But it does so in a responsible way by ensuring frictionless trade with the EU. 

Mrs May is determined to talk to as many audiences as possible rather than just, as has often been her wont in the past, playing to Conservative MPs. Her speech in Parliament was addressed as much to Labour MPs as to Tories. Her press conference was intended to take the message to the country: her calculation is that the best way to bring wavering MPs onside is to address their constituents who are worried about their jobs and who, more than anything else, want the government to get Brexit over and done with. Mrs May took every opportunity to present herself as the grown-up in the room. Rather than crackpot policies such as leaving without a deal or having a second referendum, Mrs May claims to offer a realistic solution to a difficult problem.

Her press conference came after one of the most dramatic days in British politics in decades. At 9am Dominic Raab, the Brexit secretary, resigned on the grounds that he couldn’t bring himself to sell an agreement with “fatal flaws”. He is the second person in five months to resign from that job. A little later Esther McVey, the work and pensions secretary, quit. She is the eighth cabinet secretary to resign in the past year. During the morning two junior ministers and two parliamentary private secretaries resigned—and most Westminster-watchers expect more to go in the next few days. 

During her three-hour ordeal before the House Mrs May was confronted with opposition to her deal from every shade of opinion. Jeremy Corbyn, the leader of the Labour Party, denounced her deal as a “huge and damaging failure” and an “indefinite half-way house”. Nigel Dodds, the leader in Westminster of the Democratic Unionist Party (DUP), accused her of betraying Northern Ireland and “choosing subjection”. Conservative Leavers were incandescent. Sir Bill Cash accused her of “broken promises”, “failed negotiations” and “abject capitulation to the EU”. But Tory Remainers were equally unreconciled to the deal. Anna Soubry and Justine Greening pooh-poohed it and made the case for a second referendum. At 11.30am Chris Leslie, a Labour MP, noted that “we’ve talked for an hour and no one has offered their support to the prime minister.”

With the Labour Party, the DUP, the Scottish Nationalists, the Lib Dems and a phalanx of Tory MPs ranged against her (84 of them, according to Mark Francois, a Conservative), it is hard to see how she can get her Brexit deal through the Commons. Mrs May can talk over Parliament to the nation as much as she likes. She can raise the spectre of a catastrophic no-deal Brexit or a betrayal of the referendum. She can bribe and bully members of her party. But the parliamentary arithmetic looks impossible. 

At the same time Mrs May faces a growing rebellion within her own party. Shortly after lunch Jacob Rees-Mogg, the leader of the pro-Brexit European Research Group and a man who, hitherto, has always proclaimed that he wants to change the leader’s policy not the leader, said that he was sending in a letter calling for a confidence vote on Mrs May. The Conservative Party’s rules dictate that it must hold a leadership election if Graham Brady, the chairman of the 1922 Committee of backbench Tory MPs, receives letters demanding a leadership election from 15% of the party’s MPs (which currently means 48 of them). Mr Rees-Mogg’s intervention makes it more likely that more Brexiteers will send in letters. And today’s general chaos also makes it more likely that middle-of-the-road MPs might have had enough of Mrs May’s leadership. Everybody agrees that she is a dutiful politician. But she is also an incompetent one who has brought much of this misery upon herself. She triggered the Article 50 exit process before Britain was ready, laid down red lines that turned pink and spent months negotiating a deal that fell apart on its first contact with political reality. 

Mrs May could therefore soon find herself confronted with a leadership challenge. The most likely challengers to are two Leave-voters, Mr Raab and Michael Gove, and two Remain-voters, Sajid Javid and Jeremy Hunt. Messrs Raab and Gove might be able to say that as long-time Leavers they are best positioned to deliver a real Brexit. Mr Raab is probably in the stronger position: he can claim that he resigned on principle as soon as he saw that Mrs May’s Brexit didn’t really mean Brexit, whereas Mr Gove has remained close to the prime minister. Messrs Javid and Hunt can claim that they are hard-headed realists who can bring the two sides of the party together behind Brexit. 

A leadership election would be embarrassing as well as bloody. The party would spend weeks tearing itself apart when it ought to be grappling with the most complicated bit of statecraft in a generation. It would destroy what little credibility it still has with voters. Young people in particular are already furious with the Tory party for dividing the country over Brexit. They will be more furious still if the party abandons itself entirely to civil war. 

It is hard not to despair about the state of British politics. Mrs May’s Brexit deal clearly offers a worse outcome than the status quo, including an obligation to obey the EU’s rules for the foreseeable future without any say over what those rules should be. Yet for all this awfulness, today’s debate in Parliament was surprising. Mrs May gave one of the best parliamentary performances of her career. She laid out the case for her Brexit deal with admirable vigour (indeed, remarkable vigour, given that she spent most of yesterday trying to sell it to a reluctant cabinet). Jeremy Corbyn also gave an impressive speech which combined rare passion with forensic analysis of Mrs May’s proposals (Labour MPs suspect that his speech was written by Sir Keir Starmer, the shadow Brexit secretary, rather than Seumas Milne, his usual wordsmith.) Many other MPs were on impressive form. There was plenty of parliamentary rhetoric of a high order. The pity was that it was all devoted to appraising a deal that has little chance of making Britain a better place. 

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Sanctions on Eritrea are lifted

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ERITREA HAD AN inauspicious start to the year. In January neighbouring Sudan accused it of supporting armed rebel groups and closed its border. Eritrea responded by alleging that Sudan, along with Ethiopia and Qatar, was plotting to overthrow its president, Isaias Afwerki (pictured). Meanwhile, relations with Ethiopia, another neighbour, with whom it fought a bloody war between 1998 and 2000, were stuck in a deep freeze. A UN arms embargo, imposed in 2009, in part over its alleged support for jihadists in neighbouring Somalia, remained in place. Eritrea was Africa’s most isolated dictatorship.

Then everything changed. In July Isaias signed a peace deal with Ethiopia’s new prime minister, Abiy Ahmed, leading to a resumption of relations and an opening of their border. Weeks later Eritrea agreed to restore diplomatic ties with Somalia, after 15 years of animosity, and made progress towards resolving a long-standing border dispute with Djibouti. Last month it was reported that Eritrea and Sudan might also make up. “We are now entering a new era,” said Isaias. Indeed, on November 14th the UN Security Council voted unanimously to lift the arms embargo and the threat of targeted sanctions on Eritrean officials.

The move by the UN seemed unlikely a year ago. Eritrea had blocked the UN’s investigators from examining the country’s ties to foreign rebel groups and suspected violations of the arms embargo. Observers assumed that greater co-operation, and a full rapprochement with Djibouti, would have to precede the lifting of sanctions. Some Western countries also wanted to see improvements in Eritrea’s woeful human-rights record. “Eritrea cannot assume that by saying wonderful things and opening good relations with the neighbours that will automatically lead to sanctions relief,” said Tibor Nagy, America’s top diplomat for Africa, in September. But Somalia and Ethiopia, which has a seat on the Security Council, helped to persuade members to lift the sanctions.

They were not very effective anyway. Arms had been getting in to Eritrea, many smuggled across the border with Sudan. The expansion of a military base in Eritrea belonging to the United Arab Emirates is also thought to have violated the embargo. Eritrea was not under an economic blockade, nor were its officials’ assets frozen. In the mining sector, a big part of Eritrea’s economy, investment actually increased after 2009. The economic sanctions were so narrowly targeted they were “practically toothless”, says Awet Weldemichael of Queen’s University in Canada.

The sanctions may have deterred some foreign investment, but the government’s own policies are most responsible for Eritrea’s woes. The UN likened its system of indefinite conscription to mass enslavement. Foreign firms saw this as a litigation risk. Nevsun, a Canadian mining firm and one of the only big foreign investors in Eritrea, says sanctions have had “no impact” on its work—but it has been taken to court for allegedly using forced labour in the construction of its zinc and copper mine near Asmara, the capital.

The government runs a command economy, making decisions that deliberately “limit the size of the pie”, says Jason Mosley of Chatham House, a think tank in London. In the early 2000s the government started withdrawing business and import licences from Eritrean entrepreneurs, prompting an exodus. The Red Sea Corporation, a conglomerate owned by the ruling party, has a virtual monopoly on public contracts. Since 2006 there has been a total ban on private construction.

Eritrea’s improved relations with its neighbours have raised hopes of a more stable Horn of Africa. But the lifting of sanctions will do little to help ordinary Eritreans. Isaias has ruled the country with an iron fist since independence from Ethiopia in 1993. At the least, he will no longer be able to blame foreign powers for his country’s problems. 

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