As we continue our analysis of the financial instability in the West, we would be remiss to not highlight the ripple effect it has had on emerging economies that threatens global growth. In news about the war in Ukraine, Xi Jinping and Vladimir Putin have been making headlines following the Chinese president’s visit to Moscow. While the visit was publicly regarded as part of China’s efforts to mediate the conflict in Ukraine, we take a look at articles this week that assess China’s underlying interests. Another news headliner we take a look at this week is the massive protests in Israel against Netanyahu’s push for judicial reform. Finally, after 20 years, we explore the Iraq War’s lasting impact on American society.

Emerging Economies on the Edge

World Bank warns global economy at risk of lost decade of growth

Chris Giles, Financial Times

Another Western Financial Crisis Puts Emerging Economies on the Edge

Alexander Clarkson, World Politics Review

The global economy is on a precipice. The recent failures of Silicon Valley Bank and Credit Suisse show the fragility of the global financial system in the face of rising interest rates. While those events bear bad news for developed economies, emerging economies may face even worse fates. As global rates rise, investors flee towards more stable markets in the West, thereby inducing a sell-off in riskier emerging market assets. Decades of corruption and authoritarian rule in many developing countries have rotted away their ability to handle such a crisis. The US dollar’s strength combined with supply disruptions from the Russia-Ukraine war have massively increased the price of energy and foodstuffs. All of this, combined with Covid-19’s lasting negative effects on investment and education, threaten to undermine efforts to improve global living standards, reduce poverty, and address climate change. Experts advise the best way to fend off this fate would be an international policy effort to raise investment levels and induce higher levels of labor force participation.

China’s Russia Strategy

Putin and Xi Are Making the War in Ukraine a Global Contest

Judy Dempsey, Carnegie Europe

Xi’s Visit to Russia Was About China’s Interests, not Ukraine

Yena Lee, World Politics Review

The outcome of the war in Ukraine will inevitably alter the shape of the world order. As Russia has become more isolated from the rest of the world its dependence on China has grown. This dynamic has reshaped the two’s relationship, relegating Russia to a junior partner. While China hasn’t directly given Russia arms to prosecute its invasion, President Xi found a warm welcome at the Kremlin when he visited recently. Beijing has also begun its attempt to posture as a peacemaker, releasing a 12-point position paper on the war in Ukraine. This stems from China’s desire to be taken seriously as a world power, and it would also allow China credit when it claims neutrality.Beijing is determined to put an end to the current world order and to be the shaper of the next. Western values – human rights, democracy, rule of law, sovereignty, and international rules of trade are at stake. Any Russian victory or Chinese success in facilitating the breakdown of the current world order would put these in great jeopardy. If the West fails to meet this challenge it will forfeit decades of progress toward a better global society. 

Israeli Judicial Crisis

Israel’s Genius, and Its Bad Shepherds

Bernard-Henri Lévy, Tablet

Israel Boils as Netanyahu Ousts Minister Who Bucked Court Overhaul

Patrick Kingsley, The New York Times

A Win for Israel’s Protesters

German Lopez & Claire Moses, The New York Times

Israel has averted a crisis for the time being as Prime Minister Benjamin Netanyahu has delayed the vote on his coalition’s highly controversial judicial reform package until later this year, signaling a victory for protesters. Protests erupted into civil unrest upon the firing of Israel’s defense minister, Yoav Gallant, after he spoke out against moving the bill forwards. Gallant indicated that the controversial bill was creating tension and protest within the IDF (Israel Defense Forces), a concern shared within the military itself. According to some analyses, armed force readiness, particularly among reserve units, was set to degrade as soldiers prepared to refuse service. With the Histadrut labor union threatening a general strike, hospitals and universities shutting down, some Mossad commandos and other military professionals threatening mutiny, and many of the general populace in Tel Aviv taking to the streets, Israeli civil and military society came together against the bill in force, prompting Netanyahu’s decision to delay the legislation. While the crisis has been averted to date, it is not clear what the future holds and whether Netanyahu’s razor-thin coalition will be able to hold on to power moving forwards, especially if he is prepared to move forwards with the bill later this year.

Iraq, 20 Years Later: A Changed Washington and a Terrible Toll on America

Robert Draper, The New York Times

The White House, Congress, the military, and the Intelligence Community see the war in Iraq as a failure of US policymaking, with ramifications ongoing today. For instance, the war, initially billed as costing only a few billion, has left the US with a tab of $2 trillion over two decades and a readiness deficit in the US military at a time when China is increasingly modernizing its military forces. In addition, as many as 8,500 American soldiers and contractors died, with 300,000 suffering from PTSD and the harmful impacts of war. Iraqi casualties in totality are steeper, with as many as 500,000 deceased. Moreover, politicians ranging from Nancy Pelosi to Donald Trump have profited from running against the war in Iraq, with Republican isolationism growing as an outcropping of the war among the two frontrunners for the 2024 nominations, Trump and DeSantis. With recruitment numbers for the army down as much as 25% this year and intelligence politicization, as seen in Trump’s rejection of the community assessment regarding Russian interference in the 2016 election and Republican embrace of the Department of Energy’s low confidence lab leak assessment, the Iraqi legacy has left a weaker American military force and a political class that has yet to learn some of its most pivotal lessons.