Chippenham & Beyond

Leon Panetta and the state of American intelligence

OUTSIDERS have typically had a hard time running the CIA. So why has Barack Obama chosen 70-year-old Leon Panetta for the top job? Mr Panetta was Bill Clinton’s chief of staff and he ran the budget bureaucracy, but he has no background in spying. Improving the state of America’s intelligence services should be a priority, yet Mr Obama is installing a man whose experience lies in politics and management, not spookery.

A partial answer may be that anybody—even an insider—would have a difficult task heading the agency today. Morale is low after the organisation has lurched from failure to scandal in the past few years. Under George Tenet, the long-time director who was beloved by his staff, the CIA failed to spot the September 11th attacks in the works. Then came intelligence mistakes over weapons of mass destruction and Iraq, followed by controversy over the use of torture and harsh interrogation techniques, such as the “waterboarding” of suspected terrorists (making the detainee believe he is suffocating or drowning). ...

In 2008 America's stockmarkets suffered their second-worst year since 1825

INVESTORS are told that the value of their shares may go down as well as up. Rarely, however, do they plummet as far as they did in 2008. The total return of the S&P 500 index fell by nearly 40% last year, the second-worst performance by America's stockmarket since 1825, according to calculations by Value Square, a Belgian asset-management firm. Comparisons to the Depression are clear: only in 1931 and 1937 were there similarly abysmal losses. The firm looked at various predecessors of the S&P 500 from 1923 onwards, and for earlier years took data from a working paper by Yale Management School on the returns of companies listed on the New York Stock Exchange. Since 1825, 129 years saw rising returns, whereas 55 suffered falls—four of them in this century.

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The Blagojevich saga drags on, embarrassing the Democrats just when they should be celebrating

THE 111th Congress is sworn in on Tuesday January 6th. The 435 representatives will take their places with a minimum of fuss, but the more august chamber, the Senate, is bogged down in the sort of machinations that a writer of political fiction would scarcely dare to dream up.

The main row, concerning the post of junior senator from Illinois, is turning into a great embarrassment for the Democrats just as they ought to be celebrating their assumption of a decisive lock on the Senate. The party may end up with 58 or even 59 of the 100 seats, tantalisingly close to an unblockable supermajority of 60. It gains piquancy from the fact that it is the victory of Barack Obama that made the whole mess possible. ...

Cuba's Raul Castro has made overtures to Barack Obama

In the wake of the 50th anniversary of the Cuban Revolution, President Raul Castro has made overtures to the US president-elect, Barack Obama. Seizing on Mr Obama’s statements on the campaign trail that he would be willing to meet with Cuban officials and consider loosening sanctions, Mr Castro has repeated a recent offer to meet on “neutral ground”. However, though Mr Obama is likely to ease some of the restrictions on US-Cuba economic and family ties, a more substantial revamping of the US’s trade and investment embargo on the island is not likely in the short term.

Cuba's dealings with the US have been on hold during the transition between the outgoing presidency of George W Bush and Mr Obama's inauguration on January 20th. In one of his regular press "Reflections", Fidel Castro—who, though ailing, remains an intellectual force influencing Cuba’s political life—welcomed Mr Obama's election, describing him as "decent". Yet the former president’s language has been cautious. Raul, who took over from his brother in July 2006 and was officially named president in February 2008, has also suggested that expectations of a change in US policy may be too high. ...

The downturn poses new challenges for philanthropy

AMONG the more difficult things to forecast for 2009 is what will happen to giving. On the one hand, the turmoil in financial markets has reduced the assets of many prominent givers, both foundations and individuals. Warren Buffett’s company, Berkshire Hathaway, has lost around one-third of its value in the past year. Sir Tom Hunter, a Scottish entrepreneur who had become one of the leaders in a resurgence of British philanthropy by pledging to give away a billion pounds over his lifetime, has lost a lot of money, and says his foundation will be “scaling back what we are doing this year”. The collapse of Bernie Madoff’s Ponzi scheme has dealt a devastating blow to Jewish philanthropy in particular, as so many wealthy Jews invested their money with him, hitting several charities very hard, including prominent non-profits such as Human Rights Watch.

On the other hand, giving has proven remarkably recession proof, at least in America. During the Great Depression, giving rose. Over the past 40 years there have been several recessions, but just one year in which total giving has fallen in America: 1987, the year of the “Black Monday” stockmarket crash. ...

The downturn poses new challenges for philanthropy

AMONG the more difficult things to forecast for 2009 is what will happen to giving. On the one hand, the turmoil in financial markets has reduced the assets of many prominent givers, both foundations and individuals. Warren Buffett’s company, Berkshire Hathaway, has lost around one-third of its value in the past year. Sir Tom Hunter, a Scottish entrepreneur who had become one of the leaders in a resurgence of British philanthropy by pledging to give away a billion pounds over his lifetime, has lost a lot of money, and says his foundation will be “scaling back what we are doing this year”. The collapse of Bernie Madoff’s Ponzi scheme has dealt a devastating blow to Jewish philanthropy in particular, as so many wealthy Jews invested their money with him, hitting several charities very hard, including prominent non-profits such as Human Rights Watch.

On the other hand, giving has proven remarkably recession proof, at least in America. During the Great Depression, giving rose. Over the past 40 years there have been several recessions, but just one year in which total giving has fallen in America: 1987, the year of the “Black Monday” stockmarket crash. ...

Where paradise and purgatory meet

THIS is a diary of a week in paradise. Not heavenly paradise, or Eden, but a third usage of the term: tropical paradise. Today, I am in Lamu on the north coast of Kenya. This narrow, blistering archipelago has been on the posh end of the hippy trail since the 1970s. For centuries before that, a mongrel mix arrived on the trade winds: Omanis, Yemenis, Persians, Indians, Malays, Comorians, Somalis, Africans from the length of the Swahili coast, Portuguese, Germans, and British. Some added to the rich Sufi traditions of Lamu’s mosques; all played a part in fashioning an urban culture alternately pious and decadent, which even now has no need for cars and is only incidentally electrified. ...

Russia has cut supplies of gas to Ukraine, but a deal will soon be reached

Russian gas supplies to south-eastern Europe have been disrupted by the now customary dispute over pricing between Ukraine and Russia which has led the latter to cut supplies to the Ukrainian domestic market. The two sides were briefly close to an agreement but are now far apart and blaming each other for the cuts. In theory Ukraine has sufficient reserves to hold out for 2-3 months and so the transit problems could rumble on; in practice, the two sides’ mutual dependence argues in favour of an agreement. Yet this depends on Ukraine’s squabbling leaders putting their differences aside and taking responsibility for an arrangement that will see import and domestic prices rise still higher.

In the first two days following the cessation of Russian gas supplies to the Ukrainian market on January 1st, there were no reports of a fall in deliveries of Russian gas to European countries via Ukraine. Since January 3, however, a number have been affected: Poland, the Czech Republic, Bulgaria, Romania, Turkey, Croatia and Greece. Poland has been the most severely effected, with supplies via Ukraine down by 11% compared with a month earlier. ...

Countries with the most, and fewest, doctors

UNSURPRISINGLY access to health care is closely tied to wealth. African countries have the fewest doctors per head of population, with Malawi the worst off. Beyond Africa, Bhutan is particularly short of doctors. Turkmenistan and Cuba have the most doctors to go around, more even than rich countries. Other former communist countries such as Belarus and Georgia are also well endowed with members of the medical profession.

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Fighting continues within the Gaza Strip, as Israeli soldiers push into the territory

ISRAELI forces pushed deeper into the Gaza Strip on Monday January 5th, the second full day of their ground assault. Israeli troops have encircled Gaza City and are gingerly moving against Hamas fighters who are entrenched in built-up areas. For Israel so far the price has been relatively low—one soldier has been killed and over 50 injured. Israel claims that dozens of Hamas men have died in firefights while others have been captured and taken to Israel for interrogation.

On the other side the death toll is far higher. Palestinian and UN sources count more than 530 Palestinian dead since the Israeli aerial bombardment began ten days ago. Civilians make up at least a quarter of the dead. These casualties include the wives and children of two senior Hamas commanders targeted by Israeli airstrikes at the weekend and a family of seven killed, according to Palestinian reports, by an Israeli naval shell on Monday. ...

Which countries produce most coffee?

THERE is indeed an awful lot of coffee in Brazil. And there is quite a bit in Vietnam and Colombia too. But while these three countries produce the most coffee their wares are drunk mainly in places where it would not grow quite so well. Americans drink the most of the invigorating beverage though Brazil gets through quite a bit too. Germany and Japan also outdrink those traditional homes of coffee swilling—France and Italy.

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Big elections, a battle against the economic downturn, the hunt for a deal to replace Kyoto and more

• IN JANUARY America welcomes Barack Obama, its 44th president, to the White House. Americans will hope that he can revive the economy and lift the gloomy mood at home while improving the country’s reputation abroad.

For background, see article ...

Who has a closet without a skeleton?

WHY is a beer better than a woman? Because a beer won’t complain if you buy a second beer. Oops. There go your correspondent’s chances of working for Barack Obama, America’s president-elect.

In November the New York Times reported that anyone wanting to work for Mr Obama must first pass a punishing set of background checks. In itself, that is only ordinary political prudence: any skeletons in a newcomer’s closets will be swiftly dragged out by opposition politicians. ...

Who's afraid of nuclear power—and why?

MY FIRST planned trip to France’s new nuclear-power plant, under construction at Flamanville in Normandy, was cancelled at the last moment. The organisers gave two contradictory reasons: one was that a group of VIPs had taken precedence, the other was that the site had to be closed suddenly for two days.

Naturally, I assumed the worst—that something dreadful had happened up there on the French coast. A bit paranoid, perhaps, but even two decades on from Chernobyl it is hard to forget the dark side of nuclear power. Many European and American politicians have decided to go full-speed ahead on nuclear power, which is carbon-free and offers a route to energy independence, but citizens remain fearful. Indeed, public opinion (along with the expense of building nuclear-power stations) remains the main barrier to widespread resurgence of nuclear energy in the West. ...

Soon Barack Obama will have to explain how he would tackle the problems of Israel and Palestine

ISRAEL continued to strike the Gaza Strip on Wednesday December 31st, and Hamas continued to send rockets into Israel, despite assorted calls for a ceasefire. As the conflict has wound on, Barack Obama has enjoyed the luxury of silence. His aides explain that this is because “there is only one president at a time”, although this convention has not prevented the president-elect from having a fair bit to say since November 4th about bail-outs, stimulus plans and other domestic issues. Still, there is clearly a case to be made that in sensitive matters of foreign policy, more so than the purely domestic, America ought to speak with a single voice.

But in three weeks, on January 20th, that voice will be Mr Obama’s. And the world will then start to discover what approach Mr Obama will take towards the problems of Israel and Palestine, the source of so much tension in the Middle East and beyond. Will he invest the full powers of the presidency in the search for peace there, as Bill Clinton did, in the end to little effect? Will he instinctively shy away from the problem, as George Bush did, at any rate to begin with? Or will he try for something wholly new, which might mean finding creative ways to lessen the perception that America is first and foremost a friend to Israel rather than a wholly dispassionate and honest broker? It is still remarkably hard to be sure, but the chances are that the Middle East will remain, if not on the back-burner, then some way off from the front one. ...

To look ahead, look back to 2002

NO MATTER what happens in 2009, financial markets can surely not be as turbulent as they have been in 2008. The virtual demise of the independent investment bank, the rescue of Fannie Mae and Freddie Mac, the halving of global share prices—these were sufficient shocks to last investors for a decade.

If 2008 was dominated by a financial crisis, 2009 seems likely to be the year when the bad news comes from the economy and from the non-financial corporate sector. All the forward-looking surveys, such as the purchasing managers’ indices, have been gloomy for months. The surprise indicator compiled by Dresdner Kleinwort, an investment bank, indicates that both European and American data have been a lot worse than expected. On the corporate side, everyone expects profits to fall but analysts’ forecasts do not yet reflect that likelihood. And everyone expects the default rate on bonds (and loans) to rise, but nobody yet knows which companies will fail. ...

Bangladesh enjoys a pretty clean election and a decisive result

IT WENT better than anyone dared hope. On December 29th Bangladesh held its first general election for seven years. It was well-attended, with a 70% turnout, well-organised, largely peaceful and, despite some vote-buying and other malpractice, far cleaner than its predecessors. It produced an astonishing, massive landslide for the alliance led by the Awami League of Sheikh Hasina Wajed (pictured above), prime minister from 1996-2001, and daughter of the country’s murdered independence leader.

Yet, as always, the voting was the easy part. After two years under an army-backed “caretaker” government, the return to democratic rule is unlikely to be smooth. The army staged an unannounced coup in January 2007 amid street violence ahead of a scheduled election that the Bangladesh Nationalist Party (BNP), in power from 1991-96 and 2001-06, was rigging. Both the BNP, led by Khaleda Zia, widow of an assassinated former general and president, and the Awami League had run corrupt, inept governments. ...

Israel's assault on Hamas in the Gaza Strip continues for a fourth day

“BY THE time we’re finished,” Israel’s deputy chief of staff, General Dan Harel, told a group of mayors from towns close to the Gaza Strip on December 29th, “there won’t be a Hamas building left standing in Gaza.” They could well believe him. In four days of bombing that began with a massive, sudden raid on December 27th, Israeli jets, unmanned drones and helicopters killed some 350 Palestinians, smashing offices belonging to Hamas, the Islamist movement that has run the strip since booting out its secular Fatah rivals a year-and-a-half ago, as well as police stations, ministry buildings, Gaza’s Islamic university, refugee camps and workshops. In a raid by 40 aircraft on December 28th, dozens of arms-smuggling tunnels under the border with Egypt were destroyed.

The onslaught is meant to stop Hamas firing rockets at Israel. But the general predicted that “the worst is still ahead”. UN agencies said between 50 and 90 of 300-plus killed in the first three days were non-combatants. If tanks and artillery enter the fray, civilian deaths may mount faster. In the past year, before the latest onslaught, 420-plus Gazans had been killed in Israeli raids, at least a fifth civilian, according to B’Tselem, an Israeli human-rights lobby. ...

Demand for mobile phones will grow in 2009

FROM the world's poorest countries to the very richest, the demand for mobile phones will not be derailed by tougher economic times. Globally, subscriptions will swell by 8%, bringing the total to some 4 billion worldwide. In the developed world growth will be spurred by the need to upgrade to ever more powerful, internet-enabled phones, while in emerging economies heavy investment in network infrastructure will mean that virtually anyone, just about anywhere, will be able to get reception. In recession-hit economies, however, customers will delay their upgrades and cut back on pricier usage plans.

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Our correspondents celebrate on four continents

THE Metropolitan tube leaves Baker Street every quarter-hour for the Chilterns. Converted flats in old brick terraces lie mashed together along the track in Marylebone, a bit like the passengers inside who sit three to a bench. The track crosses the Grand Union Canal at Rickmansworth, then heads onward through rolling chalk hills and beech woodland. In this landscape sheep huddle together for warmth and red kites hover over fields, where cold mist rises from wheat stubble.

It is a quiet ride, except for the rumble of the tracks and the very faint hum of the M25, which passes through Chorleywood in its orbit of London. London commuters consider conversation with strangers to be symptomatic of mental instability. More to the point, passengers are too horrified by tales of bank failures and lay-offs in the free daily newspapers these days to speak to each other. ...