UK

Labour would need to build 3,000 new wind turbines to meet its net zero targets

Ben Riley-Smith
Sun, July 16, 2023 

Offshore wind turbines near Redcar, England - Abstract Aerial Art/Digital Vision

Labour would need to oversee the creation of up to 3,000 new onshore wind turbines in its first term in office to hit the party’s ambitious net zero targets, The Telegraph can reveal.

Sir Keir Starmer has pledged to more than double the amount of power generated from onshore wind from the current level of 15GW to around 35GW by 2030.

Analysis for The telegraph by RenewableUK, the British wind energy trade body, estimates that between 2,000 and 3,000 new wind turbines on UK soil would be needed to achieve that ambition.

That could mean an increase of around one-third from the current total of 8,600, and it would be delivered by Sir Keir ending the effective ban on new onshore turbines being built in England.


A Labour Party spokesmen did not dispute the accuracy of the estimate.

The construction of wind farms on the UK mainland has proved much more politically sensitive than building turbines offshore.
Boosting energy output

Climate campaigners insist onshore wind is one of the quickest, cheapest ways to boost the UK’s green energy output, but some past projects have received criticism for being eyesores.

New wind turbines tend to be much taller than past models. One wind farm in Scotland recently replaced 1990s era 50-metre tall turbines with ones that were 200 metres in height.

Labour frontbenchers are looking at offering incentives to communities to back nearby energy projects, such as cash payouts, energy bill discounts or investment in local groups.

Ed Miliband, Labour’s shadow climate change secretary, will publicly signal his interest in incentive schemes on Wednesday at an event hosted by the Conservative think tank Onward.

A Conservative Party spokesman said: “Decisions on onshore wind should be for local people and new developments must have the support of local communities.

“We recently consulted on improving the rewards and benefits offered to communities which back onshore wind farms but Keir Starmer wants to discard all of that and impose thousands of turbines on areas where people don’t want them.”
Energy bill crisis

Ed Miliband said: “Opposing cheap, clean power for our country has left us at the mercy of fossil dictators like Putin which has given us the worst energy bills crisis in memory.

“Labour would end the ban by bringing onshore wind into line with other local infrastructure so the British people can reap the benefits of cheaper power and we would ensure direct benefits for the communities that host clean power.”

Labour has estimated that the effective onshore wind ban in England has added £180 onto annual household energy bills, given how much wind power would have increased without one.

The wind power target is part of Sir Keir’s push to make the UK a “clean energy superpower”, named earlier this year as one of his five central drives for government.

A document detailing his plans if Labour wins the next general election included aiming for a “cheaper, zero carbon electricity system by 2030”, arguing the lack of progress has kept household bills high.

Specific targets were announced to hit that ambition, including quadrupling offshore wind power, tripling solar power and backing new nuclear modular reactors.
Effective wind farm ban

Successive Conservative governments have long had in place an effective ban on new onshore wind farms in England, with planning rules so tight that any local objection can effectively block a project.

On taking office, Rishi Sunak said he would block new windfarms, reversing plans by Liz Truss to make onshore turbines easier to build. But he was forced to backdown by Tory rebels and in December announced a consultation on loosening the restrictions that effectively ban new projects.

Boris Johnson had been preparing to unveil a similar expansion in onshore wind as the one that Sir Keir is proposing in his energy security strategy last year, but he backed off at the last minute.

The vast majority of current onshore wind turbine projects seeking permission are in Scotland, Wales and Northern Ireland, rather than England, due to windier conditions and looser planning rules.

James Robottom, RenewableUK’s head of onshore wind, said: “Onshore wind is one of the UK’s cheapest sources of electricity and we can build it much faster than other power sources.

“So at a time when we need to strengthen Britain’s energy security as a matter of urgency and protect billpayers against volatile international gas prices, we should be accelerating the roll-out of projects in areas where they have community support.”

As asylum-seekers struggle while waiting for work permits, Chicago businesses can’t fill jobs










Armando L. Sanchez/Chicago Tribune/TNS

Laura Rodríguez Presa, Talia Soglin, Nell Salzman, Chicago Tribune
Sun, July 16, 2023 at 4:00 AM MDT·11 min read

Huberth Espinoza, 65, sat on a bench outside the 5th District police station in Pullman on a Wednesday in late June, waiting to be picked up for work.

An asylum-seeker from Venezuela, Espinoza said he came to Chicago to work but could not immediately get a job permit. So he worked for about two weeks for a man who would take him and other migrants to do odd jobs — construction, painting and yardwork — but he had not been picked up or paid in a week.

Espinoza said he was owed about $600.

“He told us he’d be back at 9 a.m., but he never came. We don’t know if he’s going to pay us,” he told the Tribune.

For most migrants, finding work is volatile and sometimes dangerous because they lack work authorization permits. And while many migrants work under the table, leaving them vulnerable to exploitation, Illinois business owners say they have open jobs they can’t fill. Business leaders, along with Gov. J.B. Pritzker and other political leaders, have urged the federal government to expedite the process.

Last month, more than 100 employers and business group leaders from more than a dozen states, including Illinois, signed an open letter coordinated by the American Business Immigration Coalition asking the White House to allow states to sponsor work permits for new migrants and longtime undocumented workers.

Signatories include leaders of the Chicagoland Chamber of Commerce, the Illinois Restaurant Association and the Illinois Manufacturers’ Association.

On Friday, U.S. Rep. Jesús “Chuy” García began circulating a letter urging President Joe Biden to provide and expedite work permits to both new migrants and long-term contributing immigrant workers — including DACA-eligible, farmworkers and essential workers — as “one of the more sensible solutions, which are key to addressing America’s labor shortages and lowering inflation.”

“The solution to labor shortages is right here at hand,” he said. “In addition to that, it helps to address the cost of migrants and providing them with food and shelter because if they can gainfully work with authorization, then we won’t be scrambling to find funding for New York, Chicago and LA, or other cities, because it’s having a real impact on those budgets.”

In a statement, a spokesperson for Pritzker said the governor had met with White House officials “urging them to expedite work authorizations so that those who wish to live and work in Illinois can do so with dignity and respect.”

More than 10,000 asylum-seekers, mostly from Venezuela, have arrived in Chicago since August, when Texas Gov. Greg Abbott began busing refugees to cities led by Democrats. Many migrants are living in harsh conditions in city-run shelters or police stations; the Chicago Police Department said earlier this month it was investigating alleged sexual misconduct by at least one officer against a migrant or migrants, potentially including a minor, housed at a West Side police station.

Many migrants have left the shelters to find work and a place to live, even if it could affect their chances of getting asylum, or if the pay is low and the job conditions are poor, Kalman Resnick, an immigration lawyer, said during a panel with the Neighborhood Building Owners Alliance on how the real estate industry can help the new arrivals.

The timeline to file for asylum and subsequent job authorization depends on each migrant’s case and several factors including their way of entry to the U.S. and what policies were in place at the time, said Katherine Greenslade, director of the Resurrection Project’s legal clinic, a nonprofit that provides services for migrants. “It’s complex and lengthy; that’s why we recommend legal counsel,” she said.

In most cases, asylum-seekers cannot apply for permits to work legally in the U.S. until five months after they’ve submitted their asylum applications, something many are not able to do until they’ve already been in the country for months.

“Many of them are in shelters or in various unstable housing situations where getting a legal screening is just not the first or even the fifth thing on their mind,” said Megan Davis, the director of legal services at Erie Neighborhood House, a nonprofit that provides legal aid and other help to migrants.

It can take more than six months, on average, for a person to receive a work permit after they file an application, Greenslade said.

The backlog of applications at U.S. Citizenship and Immigration Services has slowed processing times even further, meaning some applicants for work permits must wait up to 15 months from the time they apply, according to García’s letter.

In the meantime, many migrants work under the table. Their work can be precarious, leaving them with unpredictable schedules, earnings and at higher risks of exploitation, wage theft and abuse. And working illegally, especially if they do so by using fake documents or documents that belong to U.S. citizens, can ultimately have adverse impacts on migrants’ immigration cases, legal aid attorneys said.

In Venezuela, 30-year-old Patricia Moyeja was four months away from getting a degree in nursing when she came to the United States. Twenty-three-year-old Julianna Ovalles was studying to be a police officer, and her sister Alexa, 22, was studying business management.

The women, who now live in city-run shelters, waited for work in late June in the parking lot of a Home Depot in the Chatham neighborhood, where hundreds of people were looking for jobs.

“We’ve been coming here for a week. We are looking for jobs cleaning houses, painting, whatever we can find,” said the younger Ovalles sister.

The job search would be easier if she had a work permit, said her older sister, Julianna. For now all they can do is wait and hope for the best, she said. The women said they make $120 to $150 a day if they’re lucky.

“We are good, we’re safe here. I like the city of Chicago, but we need more opportunities to work. We came here to work,” she said.

Day laboring has become a common way for migrants in Chicago to find work. Like the two sisters, many go stand by hardware stores, waiting to be approached and offered a job. They work as contractors and get paid in cash, typically by the day.

Even migrants who have college educations or have worked in skilled professions including accounting, teaching, nursing or the law have to take on precarious jobs that in the long run won’t allow them the opportunity to learn English, said Laarni Livings, a head volunteer with a network of volunteers in the South Loop area.

Legal aid workers in Chicago said they believed very few of the new asylum-seekers have received work permits.

The Resurrection Project has assisted a “handful” of new arrivals who are far enough along in the legal process to apply for work permits, but most of their applications are still pending, Greenslade said. Only one asylum-seeker whom the group has worked with has received a work permit; that person was able to submit their asylum application last fall, she said.

At Centro Romero, an organization that provides social services for the immigrant community, the legal department has screened over 2,000 new arrivals since last fall, said Diego F. Samayoa, associate director. Of those, fewer than 5% have been approved so far, he said, adding that they are concerned many applicants may be denied because their parole has expired.

Most asylum-seekers are paroled into the country, which means they are allowed in temporarily to process their asylum case. U.S. Citizenship and Immigration Services could, at its discretion, grant a parolee temporary employment authorization, if it is not inconsistent with the purpose and duration of their parole.

That, however, is rare, Greenslade said. Most people paroled in are given a year or just a few months in the country, so they won’t get the permit on time, or if it arrives, it’ll be expired.

When a mother from Venezuela, who declined to give her name, arrived in the Chicago area last September, she sent out her application for employment authorization with the help of Centro Romero. But her parole ended at the end of November, which means that even if she gets approval from USCIS, the permit could be expired by the time it arrives.

Most of the asylum-seekers in shelters may not have even started the process, as they wait to be connected with legal counsel, Greenslade said. But the number of migrants in need of legal services surpasses existing nonprofit legal capacity, and most cannot pay for a private attorney, she said.

But as migrants wait for work permits, Chicago businesses want to hire them.

“Everybody’s short on workers right now,” said Brad Tietz, vice president of the Chicagoland Chamber of Commerce. Migrants looking for work, he said, would be a welcome “pool of talent” to enter the area workforce.

There are upward of 1,800 open hotel jobs in the Chicago area, according to Indeed.com. The hotel industry, which has struggled to fill positions after losing workers during the pandemic, has lobbied in Washington for a bill that would shorten the time migrants must wait for work permit eligibility to one month after they apply for asylum.

Michael Jacobson, president of the Illinois Hotel & Lodging Association, said the labor shortage is present across the hotel industry, but the need is particularly acute for culinary workers.

“When there’s a banquet for 1,000 people at one of our big hotels downtown, just imagine how many people are needed to service that meal,” he said. Most city hotels now pay over $23 an hour as a starting wage, Jacobson said.

“There are people who are living in hotels who have applied for asylum and they are not allowed to work in the hotel,” said Chirag Shah, executive vice president of the national hotel association. “In a lot of circumstances, the hotels have open jobs.”

Sam Sanchez, who owns Chicago bars and restaurants including Old Crow Smokehouse and Moe’s Cantina, said he exchanged phone numbers with migrants hoping to find work when he volunteered at a food distribution in the spring.

Sanchez, who also owns a construction company, said some migrants who were skilled plaster finishers pulled up images of their work to show him on their phones.

“I got their number, I can’t wait,” Sanchez said.

The restaurant industry, like the hotel industry, took a beating during the pandemic and has struggled to fill jobs even as consumer demand has bounced back.

“A lot of people went to work construction, and they never came back,” Sanchez said. “People just moved on.”

Sanchez, who is also chair of governmental relations for the Illinois Restaurant Association, referenced the funding Chicago has allocated to help migrants. In May, the City Council approved $51 million for spending on migrant care, which mostly covered the expenses of agencies contracted to run city-run shelters, according to Mayor Brandon Johnson’s deputy chief of staff, Cristina Pacione-Zayas.

“If we would allow them to have work visas, the city of Chicago would not be spending that kind of money,” Sanchez said. “Allowing them to come in and not allowing them to work becomes a burden on the city, the state and the federal government. They don’t want to be a burden. They want to work. And we need workforce.”

Brayan Lozano, an asylum-seeker from Colombia, echoes the leaders’ plea. He’s been in the city for nearly three months. With the help of volunteers, he has found an apartment to rent, which he pays for with money he earns as a self-employed contractor.

“We come here to work, we want to contribute to society at the same time that we help our families,” Lozano said in Spanish.

“We don’t want to be a burden to the government,” he said.

Shelly Ruzicka, a workers’ rights advocate with Arise Chicago, said it is important for migrants to know they have the same rights as any other workers, regardless of their immigration status, whether working in factories, for companies or as day laborers.

Ruzicka urges migrants to keep written documents of the work agreement, including pay, type of labor and work. But even after submitting a complaint, getting their money back from wage theft does not happen immediately, if at all.

In his native country, Lozano worked as a social worker and human rights organizer, he said, which is why he sought asylum. In Chicago, he is also a key member of the volunteer network in the South Loop, looking out for fellow migrants and connecting them with resources.

He said he often communicates the possible negative consequences of working illegally, but also watches after those who take a job. Most share their locations with him, and he accompanies them to inspect the space. If he suspects exploitation or wage theft, he informs the volunteers and asks for guidance.

When the volunteer group learns of someone experiencing wage theft, they first talk to the employer and attempt to get their money. Other times, the only thing they can do is warn other migrants of the employers that could potentially exploit them.

Unfortunately, Livings said, “there is little to nothing we can do for them.”

WAGE THEFT

Hamas unable to pay salaries in Gaza after Qatari aid delay, officials say





Sun, July 16, 2023 
By Nidal al-Mughrabi

GAZA (Reuters) - The Gaza Strip's Hamas rulers have been unable to pay salaries for 50,000 public sector workers, with officials in part blaming a delay in a monthly payroll grant from Qatar, a crucial aid donor to the impoverished Palestinian enclave.

The salary crisis has sparked an unusual amount of criticism on social media in Gaza, including by some of Hamas' own employees. A drop in tax revenue and a jump in spending has made the situation even more difficult.

Most of Gaza's 2.3 million residents live in poverty, and the economy is dependent on foreign aid. Qatar has paid hundreds of millions of dollars since 2014 for construction projects. It currently pays $30 million per month in stipends for families, fuel for electricity, and to help pay public sector wages.

Hamas officials say no salary aid has been received since just over half of a $5-million grant to support the May payroll. The reason for the delay was not clear.

In Doha, Qatar’s International Media Office did not immediately respond to a request for comment.

"The government is going through a stifling and escalating financial crisis, with a continuous increase in the deficit month after month, which led to the delay of salaries this month," Awni Al-Basha, the Hamas-appointed deputy minister, told Hamas Aqsa radio.

"We are making significant efforts to pay the salaries, and we hope to do so at the end of this week," he said.

Monthly payroll costs Hamas 125 million shekels ($34.5 million) per month, said Basha.

On Sunday, Salama Marouf, chairman of the Hamas government media office, said there has also been an increase in spending, particularly for the ministry of health and repayment of bank debts. He called on Qatar to increase the salary grant to $7 million.

Gaza has been under an Israel-Egyptian blockade since 2007 when Hamas, which opposes peace with Israel, took control. Public sector employees have not received full salaries since 2013.

"With 60% (of salaries) we used to meet the basics of our needs at home. What happens when the salary is completely cut off?" said Mahmoud Al-Farra, an employee at the Hamas government media office. "This a big disappointment."

Some took to social media, questioning whether the crisis was authentic.

"Where are the taxes they collect and the grants that enter Gaza go?" one resident posted on Facebook.

(Additional reporting by Andrew Mills in Doha; Reporting and writing by Nidal Almughrabi; Editing by Emelia Sithole-Matarise)

How Tsingtao's IPO in Hong Kong turned on the tap for 30 years and US$1 trillion of Chinese offshore listings

South China Morning Post
Sat, July 15, 2023

Three decades ago today, a Chinese brewery founded by German settlers offered an unusual toast on the trading floor of the Hong Kong stock exchange.

Instead of the typical flutes of champagne for cheering stock debuts, Tsingtao Brewery handed out glass mugs filled with its namesake beer for guests to celebrate its HK$889 million (US$114 million) initial public offering (IPO), the very first offshore share sale by a China-domiciled company.

Hong Kong had never seen anything like this. The trading floor turned into "bedlam," as dozens of journalists, photographers and TV camera crew jostled with up to 100 regulators, company executives and government officials in a "melee," according to the Post's 1993 report on Tsingtao's debut.

Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.

The IPO was a success, with investors outbidding the number of available shares by more than 110 times, lifting Tsingtao's stock price by 29 per cent on debut day. The triumph paved the way for China's subsequent financial reforms in the following decades, using Hong Kong as the stepping stone in each critical step of the capital market's growth.


Guests at the Hong Kong Stock Exchange after the successful listing of Tsingtao Brewery on July 15, 1993. Photo: SCMP alt=Guests at the Hong Kong Stock Exchange after the successful listing of Tsingtao Brewery on July 15, 1993. Photo: SCMP>

Tsingtao's IPO "reflected the rapid development of the mainland's economy over the past 30 years, and the thriving growth of Hong Kong's financial market," said Kenny Ng Lai-yin, a strategist at Everbright Securities International.

Designated with the stock code 168 - an auspicious number that rhymes with the homonyms for "continuous prosperity" - Tsingtao has done well in Hong Kong. The stock has risen 24-fold since its debut, from HK$2.80 to HK$71.25 on Friday, turning the brewery into a HK$127.76 billion behemoth.

If each of the dividends Tsingtao has paid out since 1993 were reinvested in the stock, the total return would be 42 times, according to Bloomberg's analytics. Put another way: HK$5,600 paid in 1993 for one board lot (2,000 shares) of Tsingtao would overflow to HK$117,440.

Tsingtao Brewery's listing on the cover of Business Post on Friday, July 16th, 1993. alt=Tsingtao Brewery's listing on the cover of Business Post on Friday, July 16th, 1993.>

It is not just Tsingtao and its investors that have had cause to raise a glass. Regulators, investment banks, industry professionals and the local markets have all benefited from so-called H-share listings over the past 30 years. Since Tsingtao's IPO, 389 such listings have raised a total of HK$2.08 trillion.

"H shares" originally referred to the Hong Kong-listed shares of mainland Chinese companies owned or backed by the state, though today it is often used to refer to any mainland firm trading on the city's stock exchange. The term "red chip" was used to denote overseas-incorporated firms with mainland-backed parent companies.

When red chips and private enterprises are included in the mix, more than 1,400 Chinese companies have raised HK$8.2 trillion in Hong Kong in the last 30 years, accounting for about two thirds of the total. They represent 80 per cent of market capitalisation and turnover today, according to stock exchange data.

Charles Lee Yeh-kwong, who hosted Tsingtao's listing ceremony in his capacity as stock exchange chairman at the time, was the mastermind who talked to then-Premier Zhu Rongji to raise the idea of Chinese companies listing their shares in Hong Kong in the early 1990s.

"It was Premier Zhu Rongji who chose the name H shares to represent Hong Kong," Lee told the Post. "We submitted a list of proposed names to him including W shares for world shares, and I shares for international shares. Premier Zhu chose H shares, as he considered that the best name to represent Hong Kong. And it is."


Workers stick labels on bottles of Tsingtao at a brewery in the eastern Chinese city of Qingdao, in August 2000. Photo: AFP alt=Workers stick labels on bottles of Tsingtao at a brewery in the eastern Chinese city of Qingdao, in August 2000. Photo: AFP>

Without H-share listings, Hong Kong would not have attained its current status as an international financial centre, Lee said in a briefing on Friday on the eve of the 30th anniversary of Tsingtao's listing.

"Hong Kong is among the top four IPO markets in the world in the past 14 years, mainly due to the listings of mainland companies," he said, adding that credit is due to Premier Zhu for insisting that H shares adopt international standards of disclosure and governance. "The listing reform forced all mainland firms to improve their management and disclosure. It is vital to the development of the Chinese economy."

Laura Cha Shih May-lung, chairwoman of Hong Kong Exchanges and Clearing, was among the regulators to usher in H-share listing when she was with the Securities and Futures Commission.

"H shares fuelled the growth aspirations of ambitious Chinese companies, helping them to raise funds and elevating their role and visibility on the international stage," Cha told the Post.

"They also cemented Hong Kong as the go-to market for international capital seeking opportunities in the region, allowing investors around the world to tap the incredible China growth story of the last three decades. I am honoured to have played a part in this journey."

Tsingtao Brewery was established by German and British merchants in Qingdao, Shandong province, in 1903 as Germania-Brauerei Tsingtao - when the penultimate emperor Guangxu was still on the throne.

Its former company secretary, Lucy Yuen Lu, who handled the listing, said the brewer's reputation as a well-known international brand helped it to become the first to list in Hong Kong.

"The Hong Kong and mainland regulators wanted the first China company listing in Hong Kong to be successful. And it was. We had a 110-times oversubscription," she said in an interview with the Post in 2007.

Teresa Ko, Hong Kong and China chairman of law firm Freshfields Bruckhaus Deringer, has been involved in many H-share listings. She recalled the challenges of the early days.

"Many mainland executives had no concept of due diligence but they were very helpful with our verification exercise and lined themselves up with supporting documents to show to us," she said.

"Back in those days, there were no mobile phones - only one line that could make international calls on a black telephone locked in a box . The box was in a hotel room which was locked every night at 9pm and we had to queue to make a phone call."

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2023 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2023. South China Morning Post Publishers Ltd. All rights reserved.

UK

NOT EVEN A RED TORY BUT A PINK ONE

SIR Keir Starmer  says he’s happy to be branded a ‘fiscal conservative’ as he refuses to commit to greater public spending

JEREMY CORBIN THOU SHALL BE AVENGED

Adam Forrest
Sun, July 16, 2023 

Sir Keir Starmer has said he is happy to be branded a “fiscal conservative” as he repeatedly refused to commit to greater spending on the NHS and other public services.

The Labour leader was called “delusional” by the Labour left – but Sir Keir insisted that he did not mind “ruffling feathers” and argued that his party could not win power by offering reckless spending pledges.

Sir Keir is also facing a row over his party’s benefits policy, after he revealed that a Labour government would keep the controversial two-child cap on benefits devised by austerity architect George Osborne.

His shadow work and pensions secretary Jonathan Ashworth had signalled an end to the two-child benefit cap only last month, calling the policy “heinous” and arguing that it was “absolutely keeping children in poverty”.

But asked on the BBC’s Sunday with Laura Kuenssberg if he would scrap the cap, which means support is only provided for the first two children in a family, Sir Keir said: “We’re not changing that policy.”

The Labour leader repeatedly refused to say whether his party would spend more on public services in government, stating only that “a Labour government always will invest in our public services. The way to invest in our public services is to grow our economy.”

Urging “reform” of the NHS rather than committing to providing it with more money, Sir Keir said: “If all we do is simply patch up and keep going, then we won’t fix the fundamentals, and that’s why reform is so important.”

Asked if he was happy to be known as a “fiscal conservative”, Sir Keir said: “I don’t mind what label people put on me.”

Sir Keir is thought to want a Labour government to follow the Tories’ tax and public spending levels until growth returns to Britain’s juddering economy.

The Labour leader has acknowledged frustration with his plan for fiscal restraint. “Taking seriously the foundations of economic responsibility may not set people’s pulses racing – but the new country we can build on top of them will do,” Sir Keir wrote in The Observer.

Keir Starmer is under pressure to spend more on public services (PA Wire)

Andrew Fisher, who was policy chief for Jeremy Corbyn when he was leader of the party, said it was “delusional” to refuse to commit to extra spending on the NHS and public services. “Reforms are necessary, but they’re not an alternative to spending more,” he tweeted.

Mick Lynch, the firebrand leader of the Rail, Maritime and Transport (RMT) union, said people cannot “spot the difference” between Labour and the Tories. “He’s got to show that he’s on the side of working people,” he told Sky News’s Sophy Ridge on Sunday.

“Keir Starmer and his team have got to show some clear water, some red water, between themselves and the Daily Mail, the Telegraph, and themselves and the Conservatives.”

The left-wing campaign group Momentum said Sir Keir was “siding with the Daily Mail” when it comes to the “cruel” two-child benefit cap, and called for “real investment” in public services and infrastructure.

But Sir Keir took on his critics on economic policy. “Frankly, the left has to start caring a lot more about growth, about creating wealth, attracting inward investment and kickstarting a spirit of enterprise,” he said – calling it “the only show in town”.

Keir Starmer with Keir Mather, the Labour candidate in next week’s Selby by-election (Getty)

Grilled on deselections, suspensions, and the blocking of left-wing candidates – including the North of Tyne mayor, Jamie Driscoll – Sir Keir said he “rejects” the idea that he is ditching people and policies.

Asked by Laura Kuenssberg if he is happy to “ruffle feathers” in order to win power, Sir Keir said: “Of course” – before suggesting that he would be happy with even a one-seat Labour majority in 2024.

“The biggest danger is complacency,” he said on the chances of a Labour government. “I remind myself every day ... that to get from where we landed in 2019 to a one-seat majority at the next election will be a bigger swing than Tony Blair got in 1997.”

Deputy leader Angela Rayner said a Labour government will not nationalise industries if it will cost “a load of money” to do so. She told The Observer: “With the rail companies, we have said that once their contracts are up we’d bring them back into public ownership, and that’s a way of doing it. It’s pragmatism, not ideology. It’s about asking, ‘Will it improve people’s lives?’”

Asked about Sir Keir’s treatment of figures on the left of the party, she insisted that Labour needs to remain a broad church. “It has to be, because it’s not just about the party, it’s about voters,” she said.

Meanwhile, Sir Keir wouldn’t say if he would keep negotiating on current public-sector pay disputes, describing it as “the government’s mess” in his BBC interview. He also refused to put an “arbitrary” target on housebuilding – saying only that he wants to see “hundreds of thousands more houses” built.

Sir Keir did not rule out changing the Bank of England’s 2 per cent inflation target under a Labour government. Asked if he would look at changing the target, he said: “That’s something, I think, for us to address closer to the election.”

Starmer Faces UK Labour Backlash Over Bid for Fiscal Restraint



Alex Wickham
Mon, July 17, 2023

(Bloomberg) -- UK opposition leader Keir Starmer faced criticism from across his own Labour party over a pledge to keep a controversial limit on child benefits brought in by the governing Conservatives.

Four Labour mayors, including London’s Sadiq Khan, are opposing Starmer’s announcement that he would keep the two-child cap on benefits, according to people familiar with their thinking. They add to several members of Starmer’s top team who strongly criticized the Tory policy before their own leader’s reversal on the matter.

The push-back highlights the tricky balance Starmer is trying to strike as he bids to lead Labour back to power after more than 13 years in opposition. The Labour leadership is seeking to convince voters that the party will not be reckless with public spending if it wins a general election due by January 2025. But that comes at the price of abandoning previous Labour promises of largess and riling both the party’s members and its traditional supporters.

The Child Poverty Action Group charity estimates that scrapping the current Conservative policy that prevents parents from claiming universal credit or child tax credit for their third child would cost the exchequer some £1.3 billion ($1.7 billion) a year — while lifting 250,000 children out of poverty and benefiting another 850,000 children still in poverty. But Starmer told the BBC’s Laura Kuenssberg that Labour was “not changing that policy” if it gets into power.

Traditionally, the Conservative Party has sought to portray Labour as reckless with the public finances during election campaigns, a charge Starmer is determined to counter. But that also risks alienating his own party.

Khan, along with Liverpool City Mayor Steve Rotheram, West Yorkshire Mayor Tracy Brabin and Marvin Rees, the Mayor of Bristol, all think the cap should be scrapped, the people familiar said.

The backlash extends further than that, from lawmakers who are concerned that Labour’s focus on fiscal restraint means they are not offering voters enough hope or change from the status quo.

Scottish Labour leader Anas Sarwar told the Daily Record newspaper Monday that his regional party will “continue to oppose the two child limit.” Meanwhile, Rosie Duffield, a Member of Parliament on the right of the party, and Zarah Sultana, a left-wing MP, both opposed Starmer’s position on Twitter.

Several members of Starmer’s Shadow Cabinet, including Deputy Leader Angela Rayner, and Shadow Work and Pensions Secretary Jonathan Ashworth, have previously strongly condemned the two-child cap.

Separately, Jamie Driscoll, another regional mayor who is also on the left of the party, resigned from Labour on Monday after he was blocked from standing for the party.

--With assistance from Kitty Donaldson and Emily Ashton.

70% of UK's most popular domestic flights 'are faster and cheaper by train'


Ellen Manning
Sun, July 16, 2023 

Some of the most popular domestic flights in the UK could be completed quicker, cheaper and more environmentally friendly by train, a new report has found. (Stock image: Getty)

Most of the nation’s most popular domestic flights and some short-haul European destinations could be completed cheaper and faster by train, according to a new report.

Of the 23 most popular flights to UK and Europe destinations, 70 per cent were faster by rail and 57 per cent were cheaper or the same price, research by the Campaign for Better Transport (CBT) found.

On top of the time and money savings, switching just a quarter of those domestic flights for rail journeys would save 171,377 tonnes of carbon emissions - equivalent to taking 117,900 cars off the road, researchers found, while switching half of the flights would equate to taking 283,000 cars off the road.

Public transport lobby the CBT is calling for airlines to provide "realistic travelling times" for domestic flights as part of its Fewer Flights Charter aimed at reducing aviation’s carbon emissions.

The CBT is calling for various measures to encourage people to travel by train and to reduce flights. (Stock image: Getty)

Its research showed that flying from London Heathrow to Edinburgh costs between £60 and £300 by air versus £24.90 to £145.70 by rail.

Accounting for travel and processing time in the station or airport, taking the train to the Scottish capital would be 20 minutes quicker than via plane, it found, while the carbon emission for the flight per passenger was 132.35kg versus 14.53kg by train.

Read more: How the pay rise for public sector workers compares to people in the private sector

It took less than half the time of a flight to catch a train from Heathrow to Manchester - at two hours and six minutes versus four hours 30 minutes, while each rail passenger would emit 54.94kg less carbon emissions, at just 7.02kg.

In addition, travelling from the same airport to Brussels would take four hours 35 minutes by air but just one hour 53 by rail, with carbon emissions at 54.04kg versus 1.57kg.

The CBT is calling for airlines to publish 'realistic' travel times. (Stock image: Getty)

Silviya Barrett, from Campaign for Better Transport, said: “Travelling by rail within the UK and to the near continent is much more environmentally friendly than flying but also, as our report proves, in many cases cheaper, faster and more economically productive. Yet people simply aren’t aware that this is the case.

"To help incentivise train travel more and reduce carbon emissions from transport, we need to see government policies which ensure rail is always the easier and cheaper option so that more people can choose the train over the plane."

The CBT's report, ‘Plane speaking: moving from journeys from air to rail’ calls for a reduction on the number of flights to cut aviation emissions.

The group’s ten-point manifesto calls on government to require airlines to give passengers realistic travelling times for domestic flights, and force them to publish carbon emissions for domestic flights and the equivalent rail option.

They also want airlines to offer free rail tickets to the airport for passengers taking international flights, to introduce a domestic flight reduction target, set up a tax on domestic aviation fuel, and reverse the cut in Air Passenger Duty for domestic flights.

On top of that, the CBT is calling for a new rate of Air Passenger Duty for all private jet passengers, and for VAT to be applied every private jet flight, as well as penalties for airlines flying empty aircraft unnecessarily, as well as investment in more railway lines and stations and improvements to fares and ticketing.

War, Debt Distress, Inflation: G-20 Finance Chiefs Spar in India

Ruchi Bhatia
Fri, July 14, 2023 


(Bloomberg) -- The finance and central bank chiefs of the world’s largest economies will debate the risks of Russia’s prolonged war in Ukraine and yet another shift to resuming interest rate hikes in meetings next week in Gandhinagar, India.

The discussions among the Group of 20 nations come as the war drags on for nearly 17 months, slowing the global economy and keeping policymakers on edge over resurgent inflation and stuttering growth. G-20 chiefs are also examining regulations for cryptocurrencies and ways to access more climate financing.

There will be demands on the World Bank and the International Monetary Fund to shore up their balance sheets and address the impact of climate change and future pandemics. The G-20 meetings will build on discussions in Paris last month involving 40 world leaders who made commitments for easier access to cash for poorer countries facing debt stress.

Here are the major themes at play for the key meetings next Monday and Tuesday:

War Language

As the G-20 president this year, India struggled to get countries to agree to language around the war and is trying to achieve a chair summary at the end of next week’s meetings. That’s a tall order given India failed to secure a statement in the last finance ministers’ meeting in April.

China and Russia had objected to language describing the conflict even as Western leaders condemned Moscow and pledged further support for Ukraine. It’s expected it will remain tough for India to negotiate language that is palatable to all the G-20 members ahead of the leaders’ summit in September.

“On all items in core agenda, common ground was found, except for the impact of war between Russia and Ukraine on the world economy,” India’s Economic Affairs Secretary Ajay Seth said on Thursday.

Interest Rate Conundrum

Global monetary policymakers are increasingly diverging on policy stances, particularly when it comes to inflation. While elevated price gains are keeping US and European central banks in tightening mode, the prospect of deflation is compelling China to consider further easing.

Central bankers will also discuss threats posed by the banking sector turmoil that shook investors worldwide earlier this year. The failure of two mid-sized US lenders and a near-collapse of European banking giant Credit Suisse Group raised fears of a contagion, complicating the growth trajectory for the world that’s also dealing with the after-effects of the war in Europe.

Multilateral Reforms

An overhaul of the World Bank and the IMF will be on the table with Treasury Secretary Janet Yellen leading the charge. She has urged the development lenders to work harder to mobilize private capital as global challenges mount.

An expert panel headed by economists Lawrence Summers and NK Singh suggested both lenders ramp up annual loans to developing countries while tapping sovereign donors and the private sector for further funds, according to people familiar with the matter.

The panel has also advocated boosting market-linked financing to $300 billion annually by 2030, they said. In comparison, the volume of financing resources committed by multilateral organization stood at $162 billion in 2016, according to an Organisation for Economic Cooperation Development report.

A spokesperson for India’s finance ministry didn’t respond to requests for comment.

The G-20 countries are also exploring ways for the lenders to deliver loans with special provisions to protect developing nations from climate risk.

Debt Distress

The proportion of countries in debt distress, or at high risk of one, has doubled to 60% from 2015 levels, according to International Monetary Fund data. However, there are tentative signs of debt breakthroughs.

Countries like Zambia, which has been waiting for debt resolution for years, secured a deal with official creditors, including China under the G-20’s Common Framework.

The development could lead the way for other nations such as Ghana, Sri Lanka and Ethiopia, which are locked in negotiations with creditors and bondholders to restructure debt.

Crypto Regulations

Bankrupt FTX Trading Ltd. and other high-profile failures in crypto-asset markets over the past year have pushed regulators including the Financial Stability Board and the IMF to find ways to implement global standards.

“We must avoid a globally fragmented system of regulation that would allow crypto-asset activities to flow to the areas where regulation is less stringent,” said FSB Chair Klaas Knot in a letter to G-20 Finance Ministers ahead of the meeting. “This will require a further strengthening of cross-border cooperation and information sharing.”

Digital currencies issued by central banks are gaining more traction as global trade expands after the pandemic.

More than half of the world’s central banks are exploring or developing digital currencies, according to the IMF. India’s Central Bank Digital Currency has 1.3 million customers since its launch and is aiming for a million transactions a day by end-2023.

--With assistance from Erica Yokoyama, Michelle Jamrisko and Anup Roy.

Bloomberg Businessweek

NATO NATION BUILDING
Libya’s security forces release ex-minister whose detention prompted oil closure, tribal elder says

Associated Press
Sat, July 15, 2023 

CAIRO (AP) — Security authorities in the Libyan capital of Tripoli released a former minister Saturday less than a week after his detention which had prompted his tribesmen to shut down crucial oil fields, a tribal elder said.

Former Finance Minister Faraj Bumatari, who hails from the al-Zawi tribe in southeastern Libya, walked free Saturday afternoon from detention in Tripoli, said al-Senussi al-Zawi, one of the tribe's elders.

“I spoke with him by phone, and he is awaiting a flight to the east” of Libya, al-Zawi told The Associated Press by phone.

Bumatari was detained earlier this week by the Tripoli-based Internal Security Agency which is allied with the government of Prime Minister Minister Abdul Hamid Dbeibah, according to local media.

His detention was prompted by his bid to replace Sadiq al-Kabir as governor of the Central Bank of Libya, according to al-Zawi. Al-Kabir, a divisive figure in Libya, is a close ally of Dbeibah.

Dbeibah’s government didn’t comment on Bumatari’s detention.

To force his release, Bumatari’s tribe shut down crucial oil fields, which produce hundreds of thousands of barrels per day.

Al-Zawi didn’t say when they would allow the resumption of oil production. Local media, however, said technical teams were working to restart production from the closed fields.

Libya’s prized oil output has been subjected to repeated closures for different political reasons and local protesters’ demands during the chaotic decade since the 2011 NATO-backed uprising against former leader Muammar Gaddafi.

The North African country has been divided between two rival governments, each backed by international patrons and numerous armed militias on the ground.

THE WAR IS OVER

Iraqi PM visits Syria in first trip since Syrian war



Sun, July 16, 2023 
By Timour Azhari

BAGHDAD (Reuters) - Iraqi Prime Minister Mohammed Shia Al-Sudani began an official visit to Syria on Sunday, the first by an Iraqi premier since the outbreak of the Syrian war in 2011, in a trip aimed at securing their shared border and bolstering economic ties.

Iraq and Syria, which have close economic, military and political ties to regional heavyweight Iran, maintained relations throughout Syria's civil war even as other Arab states withdrew their ambassadors and closed their embassies in Syria.

Baghdad and Damascus, along with Shi'ite armed groups backed by Iran, cooperated in the fight against militant group Islamic State, which spread from Iraq into Syria and at one point controlled more than a third of both countries.

Farhad Alaaldin, foreign affairs adviser to the prime minister, said Sudani was set to discuss combatting the flow of drugs, especially the amphetamine Captagon, and preventing the infiltration of Islamic State militants over their shared 600km border.

The prime minister would also discuss trade and economic cooperation and possibilities for reopening an oil export pipeline in the Mediterranean, which could help Iraq diversify its export routes, he said.

Sudani's visit comes as other countries, including Saudi Arabia, rebuild relations with Damascus after years of tensions.

Syria was suspended from the Arab League in 2011 over Assad's brutal crackdown on protests and several Gulf states supported the armed opposition to his rule.

But Assad has regained control of most of Syria with military and economic support from Russia and Iran, Syria was readmitted to the Arab League in May, and regional countries are seeking dialogue with him to end drug smuggling and return millions of refugees.

Syria has agreed to help end drug trafficking across its borders with Jordan and Iraq.

Top Syrian officials and relatives of Assad have been put on sanctions lists in recent months in the United States, United Kingdom and European Union over their alleged ties to the trade.

The Syrian government denies involvement in the drug trade.

(Reporting by Timour Azhari; Editing by Alexandra Hudson)

Iraqi premier in Syria for first visit in over a decade to discuss boosting cooperation

In this photo released by the Syrian official news agency SANA, Syrian President Bashar Assad, right, welcomes Iraq's Prime Minister Mohammed Shia al-Sudani during a welcome ceremony in Damascus, Syria, Sunday, July 16, 2023. Iraq's prime minister held talks Sunday with Syrian President Bashar Assad in Damascus during the first such trip by an Iraqi premier to the war-torn country since the 12-year conflict began. 

(SANA via AP)

SAMAR KASSABALI and ABDULRAHMAN ZEYAD
Updated Sun, July 16, 2023 

DAMASCUS, Syria (AP) — Iraq’s prime minister held talks Sunday with Syrian President Bashar Assad in Damascus during the first trip of its kind to the war-torn country since the 12-year conflict began.

The two leaders told reporters that they discussed fighting drugs, the return of Syrian refugees and the imperative of lifting Western sanctions imposed in Syria. They also talked about Israel's strikes on the war-torn country and water shortages in the Euphrates River that cuts through both countries because of projects in Turkey.

Iraq and Syria have had close relations for years even after many Arab countries withdrew their ambassadors from Damascus and Syria’s membership in the 22-member Arab League was suspended because of the crackdown on protesters in 2011.

Assad received Mohammed Shia al-Sudani, who was heading a high-ranking delegation, at the presidential palace in Damascus. They discussed mutual relations and cooperation between the two neighboring countries among other issues, according to the office of Syria’s president.

Al-Sudani’s office said in a statement that talks revolved around ways of expanding cooperation in the fields of trade, economy, transportation, tourism, how to combat climate change and collaboration to fight terrorism.

Security cooperation against extremist groups was likely to top the agenda for the two-day visit. The two countries, where Iran enjoys wide influence, have a joint 600 kilometer-long (373-mile) border. In June 2014, the Islamic State group declared the establishment of a self-styled “caliphate,” a traditional model of Islamic rule, in wide areas under its control in Iraq and Syria.

After a yearslong campaign that left tens of thousands dead in both countries, IS was defeated in Iraq in 2017 and in March 2019 in Syria. In recent years, Syrian government forces regained control of much of Syria with the help of Russia and Iran.

Earlier this year, Syria’s membership in the Arab League was reinstated and Assad attended the Arab summit that was held in Saudi Arabia in May.

Assad referred to Turkey without naming it as being behind the “theft” of Iraq and Syria's shares in the Eurphrates River in what is affecting agriculture in both countries. Assad also said that they discussed cooperating on fighting drugs, a scourge he said is "no different from terrorism as it can destroy the society the way terrorism does.”

Syria's conflict that started in March 2011 has killed half a million people and displaced half the country's pre-war population of 23 million, including more than 5 million who are refugees.

“We are interested in working through official and government channels to solve the issue of refugees and guarantee a safe return for them as soon as the situation becomes stable in places where they reside,” al-Sudani said. Iraq is hosting about 250,000 Syrian refugees.

Al-Sudani was invited to visit Damascus during a trip by Syria’s Foreign Minister Faisal Mekdad to Baghdad last month.

The Iraqi prime minister said countries around the world that have citizens in Syria's al-Hol camp, home to tens of thousands of mostly women and children linked to IS, should start working on repatriating them as Baghdad is doing.

Al-Hol camp in northeast Syria near the Iraqi border holds about 51,000 people, including the wives, widows and other family members of IS militants. Most are Syrians and Iraqis. But there are also around 8,000 women and children from 60 other nationalities who live in a part of the camp known as the Annex. They are generally considered the most die-hard IS supporters among the camp residents.

Many countries are refusing to repatriate their citizens out of concern that they might be a security threat. Iraq has repatriated hundreds of families over the past months where they undergo rehabilitation programs.

The U.S. has a presence in both Syria and Iraq and Syrian officials have been calling for the withdrawal of American troops from the country who first arrived in 2015.

On any given day there are at least 900 U.S. forces in Syria, along with an undisclosed number of contractors attempting to prevent the resurgence of the Islamic State group. U.S. special operations forces also move in and out of the country but are usually in small teams and are not included in the official count.

U.S.-led coalition forces have officially ended their combat mission in Iraq, but continue to play an advisory role to Iraqi forces in the fight against the Islamic State extremist group.

____

Zeyad reported from Baghdad. Associated Press writer Bassem Mroue contributed from Beirut.

Welcome to the Dollar War — the global battle that will decide the fate of America's economy

Phil Rosen
Sun, July 16, 2023 

While the US dollar won't be replaced as the world's favorite currency overnight, a concerted effort to eat into its dominance has the chance to erode the greenback's place in the world.

Chelsea Jia Feng/Insider

A global battle over cash will decide who rules the world economy

The US dollar isn't just for Americans — every country in the world relies on it.

The greenback has been facilitating the flow of money and goods around the world for over a century. Buying or selling oil? Usually done with dollars. Countries issuing government debt? Usually the price of those bonds is in US dollars. For generations, the greenback has been the safe haven for investors when markets crash and systems go haywire. The US even reminded everyone just how influential the buck is when it effectively froze Russia out of the global financial system with sanctions last year.

But if you listen to certain corners of the financial world and internet, the dollar's reign as the world's financial instrument of choice could be coming to an end. Motivated by a mix of politics and economics, countries from Israel and France to Russia and China have signaled they're looking to start doing more business in a currency other than the US dollar. Central banks have also started to tiptoe away from the dollar, with currencies like the Chinese yuan, Japanese yen, and euro taking up a growing portion of global reserves.

These doom-and-gloom scenarios are overblown, financial experts told me, but in classic conspiracy fashion there's a kernel of truth to the freak out if you look hard enough. The percentage of financial transactions done in US dollars has slipped over the past few decades, and the percentage of countries' cash reserves that are held in dollars has been sliding.

These shifts, while notable, don't mean the US dollar's dominance is going to end anytime soon. There may be changes around the edges, but as the Stanford finance professor Chenzi Xu told me, there's still no viable alternative to cold, hard American cash.

"What currency would those countries hold instead?" Xu said. "We need something that looks like money, that will act like money. If you don't hold dollars, there's no alternative because everything else is too small or subject to the same risks as the dollar but worse."

While the US dollar won't be replaced as the world's reserve currency overnight, a concerted effort to eat into its dominance has the chance to erode the greenback's place in the world and cause real shifts in the financial system. If America wants to stay on top, the US can't take the dollar's status for granted.

The long arm of the dollar

Over the past five centuries, only a handful of countries have issued the bills the world uses to conduct financial transactions — the globe's reserve currency. Becoming the issuer of the global reserve currency is about trust. Whether it was the Dutch guilder, the French franc, or the British pound sterling, people trusted that the value of that currency — backed by the country's government — would stay steady enough to be the benchmark for a transaction. Political instability or prolonged economic downturns can chip away at that trust, until one day the currency is supplanted by cash from a country that is more powerful, more economically stable, and therefore more trustworthy.

For the past 102 years, the US has sat atop of the currency heap. And the globalized nature of the world's economy means the US dollar has achieved a more powerful status than previous reserve currencies. This so-called "exorbitant privilege" places America on top of an asymmetric financial system, grants the US major trade benefits, and mutes the blowback of other nations' economic fluctuations. This dynamic also means that the Federal Reserve — which is responsible for printing and controlling the supply of US dollars — is closely watched around the globe. The rest of the world pays far more attention to its policy decisions than, say, the European Central Bank or the People's Bank of China. Ron Temple, the chief market strategist at Lazard, told me that the US dollar achieved this vaunted status thanks to more than a century's worth of rule of law and stable markets, which helped earn the confidence of investors.

"People in any country around the world can be found with $100 bills tucked away for safety," he said. "That especially became true after World War II, when the US dominated manufacturing and trade while other countries were still rebuilding after the war. The US was just an economic powerhouse, with robust institutions that could withstand partisanship and conflict."

The US has controlled the global reserve currency for 102 years — giving it a special status in the world economy.

CFOTO/Future Publishing via Getty Images

Today, nearly 60% of international reserves are held in dollar-denominated assets, according to the International Monetary Fund, and it's by far the most-used currency for trade. Data from the Bank of International Settlements shows the dollar is involved in about 88% of all international trade transactions. A good litmus test to see exactly how much sway a reserve currency has is to look at what happens during financial crises. And for the past century, investors always rush to assets they can convert to dollars.

Countries like China or Saudi Arabia are doing what they can to "thumb their nose in the direction of the US," Gregory Brew, an analyst at the consultancy firm Eurasia Group, told me, but until American assets are no longer viewed as the best option in times of catastrophe, the dollar won't lose its seat at the head of the table anytime soon. Still, given that the country controlling the global reserve currency holds that status of an average of 94 years, history seems to indicate it's high time for a successor. So while the timeline may be long, talks of de-dollarization are proof that there may be a new movement afoot.

Threats to hegemony

The global economic order as we know it will end with Operation Sandman.

When Operation Sandman is launched, the emerging theory goes, 100 countries from around the world will sell off trillions of dollars worth of US government debt in a coordinated effort to undermine the value of the dollar and break America's dominance over the world's economy. The move will be calamitous for America and the global order, but in time, the effort to break the US dollar's hold on the world will open the door to a new hierarchy of economic superpowers.

If that all sounds a little far-fetched, that's because discussion of Operation Sandman is mostly confined to chatter on economic and currency conspiracy accounts on Reddit and TikTok. This "mother of all dollar conspiracies," as one Reddit user called it, would certainly be a momentous start to a new chapter, but there's little real-world indication that it could come to fruition.

"I think we live in a conspiratorial time," Eurasia's Brew said. "There's an abiding interest in certain online communities in the idea that the global economy — and specifically the world of fiat currency — is teetering on the brink of some kind of systemic collapse."

Despite the crackpot inclinations of Operation Sandman's biggest fans, they do get one thing right: There's clear evidence the world is de-dollarizing.

Stephen Jen, the chief executive of Eurizon SLJ Capital and a former economist at the IMF, caused a stir in economic circles with an April note to clients that declared the "erosion of the dollar's reserve currency status has accelerated in recent years at an alarming pace." By Jen's calculations, the share of global reserves held in dollars saw a sharp decline in 2022, eroding at nearly 10 times the average annual pace of the past two decades. In 2003, the dollar accounted for roughly two-thirds of global reserves, but Jen said his data shows that's fallen to about 47% — a much lower mark than the IMF's 60% estimate. Other groups have failed to detect as steep a drop, he told me, because they don't account for fluctuations in the underlying value of the dollars in central banks' coffers.

Jen told me that while countries beyond the US are still frequently using dollars, the appetite for the currency has cooled recently. "We've seen a sharp decline in global interest in US dollars," he said. "After 15 years of very gradual declines, we've seen a plunge, an absolute plunge in the past year."

Most shifts away from the dollar can be chalked up to politics. The world is waking up to just how America-centric the financial world has become, Jen explained — a far cry from the multipolar nature of the cultural and political landscape. And the economies in developing countries have grown larger and more sophisticated over the past few decades, which means there are fewer reasons to stay embedded in a financial landscape that hinges on the dollar and the Fed.

"There is a legitimate argument to ask the question of whether other countries should cope with a unipolar currency world," Jen said. "There's a disconnect between the two — the financial world and the real world."

It's an interesting line of thinking. Why shouldn't the financial world resemble something closer to the mosaic of cultures, politics, and nations that exists today? Naturally, it's something other world powers, such as Russia and China, would want. When the US froze hundreds of billions of Moscow's dollar reserves, it reminded other countries that the buck can indeed be weaponized.

Stanford's Xu told me that other countries are thinking: "Well, if I end up in Russia's shoes, where all my dollar assets are unusable, then it makes sense to go back to our own domestic currency." While it would make every transaction more difficult, Xu added it could "shield you from bigger shocks of not being able to use your savings."

China, for one, has made a concerted effort to promote its currency — the yuan — for international trade as a way to shield itself during a time of heightened geopolitical tensions with the US. While China's yuan comprises less than 3% of global reserve currencies, it's seen its slice of the pie grow at the fastest rate of any currency since 2016. Meanwhile, Saudi Arabia, France, Brazil, India, Pakistan, Bolivia, Iraq, and others have either completed trades using yuan or expressed a willingness to participate in yuan-denominated trade in the future. These make up a tiny fraction of total dollar transactions, but the trend is emerging.

"There's a very strong political element to this, particularly with US-China relations worsening," Eurasia's Brew told me. "From China's point of view, de-dollarization reduces their exposure to US influence and potential future sanctions. It's becoming clear the two will compete economically and diplomatically, and the yuan is becoming a political driver for other countries interested in improving their relations with China."

Meanwhile, BRICS nations — Brazil, Russia, India, China, and South Africa — have indicated that they want to launch a shared currency to directly rival the dollar. "Every night I ask myself why all countries have to base their trade on the dollar," Brazil's leftist president Luiz Inácio Lula da Silva said in April. "Why can't we do trade based on our own currencies?"

There are plenty of other threats to the dollar too: digital currencies, unexpected backlash to US sanctions, even the Fed. Josh Lipsky, the senior director at the Atlantic Council, said that the Fed's aggressive interest-rate hikes over the past year and a half have widened the gap in exchange rates between many developing nations and the US. As a result, other countries' debt gets more expensive.

"Other economies have felt the pain from the dollar very acutely," Lipsky said. "Evidence of de-dollarization is small but growing."

Small shifts, long ripples

For most people whose financial lives consist of paying bills, buying gas, and getting a mortgage, the idea of de-dollarization may seem a world away. It's not as if the average American is going to settle a cross-border oil contract or that the grocery store is going to refuse dollars anytime soon. The experts I talked to agreed: Unless you regularly transact at an institutional- or country-level, Americans probably won't notice the direct effects in their everyday lives.

But for firms that do transact at the institutional level, a weaker buck — one possible consequence of de-dollarization — could gradually crimp demand for dollars and diminish its standing as the go-to currency for big deals.

JPMorgan strategists Alexander Wise and Jan Loeys told clients they only expect marginal de-dollarization over the next decade. If the dollar's status does wane beyond that, it's possible US assets could see a hit — lower stocks, higher bond yields, pricier imports. The biggest threat, Wise and Loeys said, is if the US's geopolitical standing takes a hit.

"De-dollarization per se probably has little impact on growth and inflation, but the adverse events which could catalyze de-dollarization would probably worsen both," Wise and Loeys wrote in June.

If being the reserve currency is about trust, then any shift away from the US dollar would indicate an erosion of trust in America — its government, its economy, its financial system. The events that would cause that decline in faith would clearly be a negative for both our economy and society. A politically fueled debt default or a sudden divestment from American assets (albeit in a less coordinated fashion than Operation Sandman), would erode that faith — though neither have historical precedent.

The most likely path forward, according to the JPMorgan team, is partial de-dollarization that takes place over several decades, with the Chinese yuan the most likely candidate to cut into the dollar's share of trade and reserves. But shifting to the yuan would come with a host of new issues, from China's rules around cash leaving the mainland to the country's own economic problems. It's not even clear Beijing wants its currency to take on the reserve role.

To Stanford's Xu, de-dollarization fears are largely moot given the sheer number of greenbacks sloshing around the global financial system. It's estimated that half of all international loans and trade invoices are denominated in dollars, and the more companies and governments that use dollars as their benchmark, the more that liquidity deepens. For de-dollarization to happen, a very large stockpile of safe, low-risk debt backed by another currency would have to materialize, and Xu said that would probably require a crisis-level scenario where everyone dumps their dollars all at once. And, again, the odds of either happening remain slim.

"Having the reserve currency is unambiguously a good thing for the US," Xu said. "Part of maintaining that does require having some amount of goodwill in the world, and if the US can do that, it's going to keep providing safe assets for the international economy."

The panic is overdone, but the trend is real

It's easy to scoff at conspiracies on Reddit, but there is truth behind the whispers of de-dollarization. It is real, and it is happening — but at a far slower clip than the recent headlines may suggest.

Rather than shrugging it off entirely, however, America's leaders — from Congress to the Fed — should take all of the talk as a reminder not to take the coveted status for granted. Fooling around with Fed policy, threatening to default on US debt, or hastily imposing financial sanctions, Lazard's Temple said, isn't doing America any favors. A century of having the top currency shouldn't lead anyone to believe we'll have a century longer.

"We should always recognize we get tremendous benefits from maintaining the dollar's status," Temple said. "I don't think anything is permanent, and other countries could be ready to use something other than the dollar at some point. The 'exorbitant privilege' that we've had for decades is not a birthright."

Phil Rosen is a senior reporter for Insider covering markets and the economy.