December 2, 2022: Global News Roundup
Protests, strikes, walkouts call attention to government repression and rising cost of living
This post was originally published on IPEwithSBB.org.
The Global News Roundup collects news stories from entirely international (non-US) media sources on variety of pressing global issues and events.
It was a chaotic and turbulent week with a lot of moving parts. The Economist Intelligence Unit’s annual Worldwide Cost of Living report showed annual inflation of over 8% in local currency terms across the world’s major cities, the highest inflation rate recorded since the survey began twenty years ago. New York City topped the list for the first time ever, with Atlanta and Boston also among the top movers upward in the rankings (the report cites the “strengthening dollar” as a major cause). The table below from the EIU below shows the world’s most expensive cities to live in.
(Image: “Top Ten Positions”, World Cost of Living 2022, Economist Intelligence Unit, p. 2; in the original here).
With Los Angeles and San Francisco so high on the list, it is perhaps unsurprising that massive strikes by academic workers in the University of California system are entering their third week. “Around 48,000 academic employees – almost 18% of the entire faculty – have joined the action, which is calling for improvements in salaries and living conditions,” reported El País. One newly-hired professor interviewed for the article was “shocked” to learn that “there are doctoral students living in their cars or spending 85% of their salaries in rent”.
US railway workers were also preparing to strike this week, and shipments of some critical materials would have been halted beginning this weekend. But the US House voted on Wednesday to approve a bill to block the strike, and the Senate followed suit on Thursday. President Biden has said he will sign the bill. The “rail strike [would have frozen] almost 30% of U.S. cargo shipments by weight, stoke already surging inflation and cost the American economy as much as $2 billion per day, and strand millions of Amtrak and commuter rail passengers”, reported Reuters. Many workers were angry at Congress and the Administration for sidestepping the union negotiating process and imposing a deal, which “could undermine future collective bargaining…”.
Korean subway workers went on strike on Wednesday, walking off the job in refusal of “management’s plan to downsize”. They joined truckers who had been striking since last week. Also on Wednesday, the South Korean government took “the unprecedented step of invoking tough strike-busting laws to end [the] six-day stoppage by truck drivers it says is hurting the economy”, though “the strike’s organizers said they would defy the order and accused Yoon’s conservative government of suppressing their labor rights and ignoring what they described as worsening work conditions and financial strain caused by rising fuel costs and interest rates”. Referring to Korea’s “labor crisis”, the Straits Times additionally reported that railway workers are expected to join the strikes today (Friday).
But it wasn’t just labor unrest. In China—where worker protests over a covid outbreak at Apple’s Foxconn plant, and the brutal crackdown that followed, had just made headlines last week—a fire at a residential building in Urumqi, the capital of the Xinjiang region, spurred residents to take the streets in protest of strict covid-19 lockdown policies (residents claim that emergency responders were prevented from rescuing people in the building because of the lockdown protocols, though the government denies this; 10 people were killed, and 9 more injured). The protests quickly spread across other Chinese cities, with demonstrators holding up blank sheets of paper to protest censorship of covid-19 information (see image below), and some even calling for President Xi to step down. The South China Morning Post noted that, “Open defiance is rare in China, especially directed at the central government and the ruling Communist Party.” In response, the government has made minor changes to some covid policies, and also launched a police crackdown on the protestors. There were also reports out of the UK that BBC reporters were assaulted by Chinese police. Al Jazeera reported that the government's response pleased financial markets.
(Image: People gather for a vigil and hold white sheets of paper in protest of Covid-19 restrictions in Beijing, as they commemorate the victims of a fire in Urumqi, on Nov 27, 2022. Photo from Reuters, courtesy of the Straits Times, here.)
In other economic news, crypto lender BlockFi filed for bankruptcy, citing its significant exposures to the FTX collapse. Concerns about the global semiconductor industry are mounting, partly owing to new policy changes in the US, which are complicating the ongoing rout in the tech sector. And, in Europe, high oil and gas prices continued to take big bites out of living standards. On Monday, the UK’s National Grid warned households and businesses to reduce electricity consumption “to fill a potential gap in supply” and avoid blackouts, following many weeks of social unrest across Europe related to the rising cost of living.
The EU ban on seaborne Russian crude oil, passed in June, goes into effect on December 5, along with a ban on the provision of maritime insurance for ships carrying Russian crude to third countries. “No one can say how disruptive these measures will be”, noted the Financial Times, “Sanctions imposed on Russia since Putin ordered troops across Ukraine’s border on February 24 have barely dented the country’s oil exports or the Kremlin’s oil income.” What is certain is that the European gas cap proposal, the one that’s been floated several times since the Ukraine war began last February and that officials hope to impose by December 5 when the Russian crude ban goes into effect, is driving a wedge between EU member states. “Russia will not supply oil to countries that back this anti-Russian confrontational initiative,” said Russian Foreign Ministry representative Maria Zakharova about the proposed cap on Wednesday.
Continuing on, riots broke out in Belgium and the Netherlands this week after Morocco beat Belgium in a World Cup match. Iran, which has been embroiled in massive protests for months after a woman died in police custody, lodged a complaint with FIFA against US Soccer officials over their modifications to images of the Iranian flag in social media posts. Twitter rolled back it’s restrictions on posts containing covid-related information. The New York Times, Le Monde, Der Speigel, El País, and The Guardian—the outlets that originally published the Wikileaks documents which exposed human rights violations and other malfeasance by the US military in Iraq, Afghanistan, and Guantanamo Bay—wrote an open letter demanding that the US drop its prosecution of Julian Assange (journalist, whistleblower, and Wikileaks co-founder), who is facing extradition from the UK to the US. “Publishing is not a crime”, noted the open letter. Longtime Assange advocate and Brazilian president-elect Lula da Silva, a former political prisoner himself, expressed his hopes that “Assange be released from his unjust prison”.
And, Deng Qingming, a Chinse astronaut who spent the last 25 years as a backup, finally got his chance to travel to space. “Twenty-five years is a long journey. Every time I missed my chance [to go into space], I felt lost and sometimes I cried, but I’ve never hesitated or given up”, Deng told reporters. He departed for the Tiangong space station on Tuesday.
Things I’m keeping an eye on:
1. The new race for space: The US also had big space news this week, with NASA’s Orion space capsule breaking the distance record for a human-rated spacecraft. NASA also entered into a partnership this week with a Texas company to build structures on the moon.
2. China protests: In the midst of the protests in China this week, former CCP leader Jiang Zemin died at age 96. How his death may factor into the protests, i.e., whether it will serve as a rallying point and help to unify the Chinese public, is unclear.
3. Oil politics: OPEC+ meets on Sunday. There’s a lot of speculation about whether or not they’ll lower production levels. The EU’s ban on Russian crude and on maritime insurance goes into effect on Monday. EU officials are trying to get the price cap in place before the ban begins.
4. De-dollarization: The BRICS website reported that Russia and India are deepening mechanisms for settling India-Russia trade in rupees, and also posted news on the creation of a new BRICS reserve currency. Dollar dominance and efforts to undermine it, an issue I’ve been discussing in my posts for some time now, is getting more and more coverage internationally. See also here for a good recent discussion that includes some useful historical context.