This week’s edition covers issues spanning economics, geopolitics, and global climate change. We start by reviewing the continuing fight against inflation from the United States to Europe. Then, we move into looking at the significance of the coup that recently occurred in Niger. Thereafter, we examine Netanyahu’s problems with his far-right partners and how an American Middle East deal may upset this dynamic. We end this week’s newsletter by assessing global responses to climate change, as recent weeks have seen some of the hottest recorded temperatures ever.

The Fight Against Inflation Proceeds

Europe’s Monetary Over-Tightening Trap

Lucrezia Reichlin, Project Syndicate

A US Recession Is Still Possible

Michael R. Strain, Project Syndicate

Over the past year, the US Federal Reserve and European Central Bank (ECB) have both hiked interest rates to fight sticky inflation. Yet the two institutions could soon diverge in strategy. For the US, further hikes may prove warranted as the core personal consumption expenditures price index has remained stuck above the 2% target for 2023, indicating that prior rate hikes have been insufficient. The downside is that the longer inflation remains and the higher rates go, the less likely the US economy makes a soft landing, ending in a recession instead.

The ECB, on the other hand, may be better served holding off on further interest rates to give space for the economy to correct. Europe, unlike the US, has been hit with both an energy supply shock and higher energy costs thereafter as gas markets rerouted to Europe at a premium. Rather than hiking aggressively and risk undermining the economy, the ECB ought to wait for price adjustments to kick in and stabilize the market without harming consumption, employment, and financial stability. 

Niger’s Coup Spells Trouble for the Region

Coast to Coast, a Corridor of Coups Brings Turmoil in Africa

Declan Walsh, The New York Times

Niger coup: Military takeover is a setback for democracy and US interests in West Africa

Leonardo A. Villalón, The Conversation

The recent military coup in Niger that toppled the country’s democratically-elected president, Mohamed Bazoum, makes Niger the latest African nation to fall under military rule. These countries include Guinea, Mali, Burkina Faso, Niger, Chad, and Sudan, forming a stretch of land from the Atlantic to the Red Sea ruled by military juntas. There is a common factor between these six countries: jihadist violence. The Sahel, a region spanning the dry land south of the Sahara desert, has become the global epicenter of jihadist violence, accounting for 43% of deaths in 2022 compared to 1% in 2007. This, and other factors such as widespread corruption and weak state capacity, has created conditions in which military leaders are incentivized to take power from a fragile civilian government.

The coup in Niger is particularly notable for the country’s significance to its region. Niger has, in recent years, been a relatively stabilizing force in the region and a key ally for Western countries to combat terrorism. President Bazoum’s election marked the country’s first-ever democratic transfer of power. Additionally, Niger has been a strategic partner in the region, especially after Mali and Burkina Faso turned to Russia for security assistance. It is still unclear which power the coup leaders will turn to, or how this development will play out for the still-democratic countries of the region.

Israel’s Far-Right May Be Difficult for Netanyahu to Rein In

A blow against Israel’s Supreme Court plunges the country into crisis

The Economist

Biden Is Weighing a Big Middle East Deal

Thomas L. Friedman, The New York Times

Israel’s parliament, the Knesset, recently passed highly-controversial laws aimed at significantly curtailing the powers of the country’s Supreme Court. The country’s ruling far-right coalition presented its plans almost eight months ago, leading to massive protests from civil society, which argued that the reforms would undermine democracy and implement majoritarian rule. Prime Minister Netanyahu and his defense minister sought to delay the vote as a last-minute attempt to find compromise. His failure signals that he has little control over his far-right coalition partners. However, a potential deal between the United States, Saudi Arabia, and Israel may upend the balance of power in Israel’s government.



The Biden administration is considering pursuing a U.S.-Saudi mutual security agreement that would involve Saudi Arabia normalizing its relations with Israel – only if Israel were to make concessions to the Palestinians that would ensure the possibility of a two-state solution. Such an agreement would mark a significant change in the Muslim world’s relationship with Israel, opening the possibility of other countries, even Indonesia or Pakistan, to normalize relations as well. The potential deal would face significant challenges, however. The Saudis want security assurances from the U.S., as well as a civil nuclear program. Prime Minister Netanyahu would have to curb his right-wing coalition partners’ power in order to agree to any concessions to Palestinians, and the Palestinians would have to endorse the deal. Additionally, the Biden administration will have difficulty selling any such deal to Congress. While success would be a long shot, this would be one of the most significant peace-building measures ever undertaken in the region.

‘Era of global boiling has arrived,’ says UN chief as July set to be hottest month on record

Betsy Reed, The Guardian

United Nations Secretary General Antonio Guterres has come out stating that “the era of global boiling has arrived.” The Secretary General’s call for immediate and drastic action comes as July is on track to be the hottest month on record due to a rise in global average temperatures driven by CO2 pollution in Earth’s atmosphere. The heat wave, which saw dangerously hot temperatures across Southern Europe, North America, and China, is one of many examples of extreme weather events to come as the Earth continues to heat up, with estimates that human emissions amplified temperatures by 2.5C, 2C, and 1C on the three continents respectively. In response, world leaders are set to meet in the United Arab Emirates in November to determine a path forwards to stop human-induced planetary heating, adapt to extreme weather events, and pay for the damage.