Hunter Biden speaks during the World Food Program USA’s 2016 McGovern-Dole Leadership Award Ceremony at the Organization of American States on April 12, 2016 in Washington, DC.
Kris Connor | WireImage | Getty Images
Whether the politicians in Washington like it or not, the last few weeks of non-stop coverage of the Trump impeachment inquiry has been shining a light on a disturbing practice that’s been in place since long before this president ever took office.
That is, we’re learning just how common it is for the children and other family members of leading U.S. politicians to get lucrative jobs and other positions from foreign state-owned enterprises. It may all be legal, but it certainly seems like a brilliant way to get around U.S. campaign finance laws that prohibit donations from foreigners and foreign governments.
It’s important to emphasize that in this Ukraine scandal, there isn’t any evidence that Hunter Biden or former Vice President Joe Biden broke any laws as the younger Biden received his lucrative state-owned Ukrainian natural gas company board post. But let’s be clear: the fact that getting these high-paying jobs and positions is often 100 percent legal isn’t a reason to be less concerned. It’s a reason to be more outraged.
But let’s be even more clear. It’s not just foreign company boards of foreign-owned investment funds at play. Children of elected officials from both parties have received lucrative jobs from U.S. companies, regardless of their experience or comparable salaries for the same positions.
There’s also the neat trick of getting all those legal American-made campaign donations into the pockets of the candidates’ family members. The easy way to do that is for a candidate to simply hire his or her family members as official staffers on the campaign and pay them whatever salary they like. That’s a long running practice several elected officials from both parties have employed for years.
So many ways to win favor
There are many other ways to at least try to win favor with our top elected officials via their family members that don’t involve actual cash and salaries.
For example, the admission rates for Stanford University (4.8 percent), Yale University (6.3 percent), Harvard University (5.4 percent), and Georgetown Law School (24 percent), are all extremely low. But for each of our last four presidents, the acceptance rate for their children at these schools has been a head-scratching 100 percent.
Either each one of these presidential kids was coincidentally a genius, or someone in academia knows how to use influence to keep those huge endowments untaxed.
Once again, to those journalists and all the legal eagles correctly pointing out that no laws are being broken by any of this, the public has one thing to say:
Yeah, so it’s likely no laws are technically being broken. But the spirit of campaign finance and bribery laws is being trashed thoroughly. Of course the voters are not alone in knowing this has been the case for some time.
Back in 2014, many of the same Democrats who are now defending the Bidens now were decrying the indirect influence lobbyists and corporations were gaining by paying off politicians’ relatives. It would be great if they had the intellectual honesty to be just as outraged by the very appearance of impropriety in the Biden case as they appear to be in response to everything they don’t like about President Trump.
There should be plenty of room for outrage over the deals, legal or not, that Hunter Biden made with foreign-owned companies and whatever President Trump and his aides have done to bring this story into the spotlight. In other words, there’s plenty of room to be angry at both the Bidens and President Trump over this entire matter.
And, there’s plenty of bipartisan reasons to highlight this issue. They include the fact that President Trump’s children continue to run his many businesses while he’s in office. The opportunities to curry undue influence via those business connections are infinite and uncharted territory in U.S. history.
But partisan political hacks are making sure to couch it in an “us vs. them” lens alone.
The pressure to show only selective outrage is abundantly clear on the Democratic campaign trail. For example, Senator Elizabeth Warren would seem to be in the perfect position to make a persuasive argument for herself based on this story.
She even has an anti-corruption plan she began pushing just as this Ukraine corruption story began to break. But when asked whether that very anti-corruption would allow a vice president’s son to make the business deals Hunter Biden did,
Really? Warren’s campaign handlers should know that any plan that doesn’t forbid what Hunter Biden was doing isn’t worth implementing. They should also know that any candidate who can’t be sure if his or her plan bans it doesn’t have the assertiveness to win a tough primary fight or a general election. Outrage works in elections, just ask 2016 Trump campaign staffers how much outrage over illegal immigration helped them win the GOP primaries.
But the Biden story brings up an even more enduring question that transcends the Trump presidency and goes right to the heart of government itself. If the existing federal campaign finance and lobbying laws have only encouraged our current more insidious forms of buying influence, what more can new laws be expected to do? The unintended consequences and clever workarounds people can find to find new and inventive ways to get their cash into the politicians’ hands will likely never end.
So once again, this is really a job for the fairest journalists out there who can find a way to shine a light on these cozy arrangements on both sides of the political aisle. The avalanche of money falling into American politics to gain influence and power is nothing new, and this is not the time to ignore it just because many of us may not like the messenger.
China wants to turn Greece’s Piraeus port into Europe’s biggest
A view of COSCO owned dock and yard in Piraeus on March 4, 2015. China Ocean Shipping Company, known as COSCO (COSCO Group), is the company in charge of transportation services in the biggest Port of Piraeus in Greece. COSCO undertook handles those operations in 2008. The deal between COSCO and the Greek government is one of the most controversial among privatizations that happened during Greece’s debt crisis.
NurPhoto | NurPhoto | Getty Images
China is looking to transform Greece’s Piraeus port into the biggest harbor in Europe — making it the most crucial transit hub for trade between Asia and Europe.
In 2016, China’s shipping firm Cosco purchased a majority stake in Piraeus port. Situated in the Saronic Gulf, Greece’s largest harbor — and Europe’s seventh biggest — is at a strategic location between the Asian and European continents. Chinese President Xi Jinping and Greece’s Prime Minister Kyriakos Mitsotakis announced earlier this week that Cosco would be investing about 600 million euros ($660 million) to develop Piraeus further.
“The objective is to transform it into the biggest transit hub between Europe and Asia and, potentially, the biggest port in Europe,” Kostas Fragogiannis, Greece’s deputy minister for foreign affairs, told CNBC Wednesday.
Rotterdam’s port, in the Netherlands, is Europe’s biggest harbor. It saw more than 8.6 billion containers (incoming and outgoing by sea) in 2018 — an increase from the previous year.
“The geographical advantages of Greek ports can be utilized for facilitating and increasing transfer flows from China and the Far East to the European Union, the Balkans and the Black Sea region, and vice versa,” Fragogiannis told CNBC.
Since the Greek financial crisis, Beijing and Athens have deepened their links. Greece announced in August last year that it was formally joining China’s Belt and Road Initiative (BRI) — the ambitious investment plan of Xi that connects Asia, Africa and Europe.
President of the Republic of China Xi Jinping (L) and Greek Prime Minister Kyriakos Mitsotakis (R) shake hands as they visit the cargo terminal of Chinese company Cosco in the port of Piraeus, Greece, on November 11, 2019.
ORESTIS PANAGIOTOU | AFP | Getty Images
During a visit to Athens earlier this week, Xi said: “We want to strengthen Piraeus’ transshipment role and further boost the throughput capacity of China’s fast sea-land link with Europe,” according to Reuters.
China has made different investments in Greece, including in energy and the real estate markets.
“With his visit in Athens, the Chinese President Xi Jinping reaffirmed his commitment to strategic infrastructure investments in Greece, as part of the Belt Road Initiative,” Athanasia Kokkinogeni, Europe senior analyst at DuckerFrontier, told CNBC via email Thursday.
“Chinese investments have risen quickly, underpinning growth in the energy, telecommunications, and real estate sectors. Western firms should plan for intense Chinese competition in Europe in 2020 across most industries,” she added.
Greece’s Fragogiannis also told CNBC that Greece and China could announce further investment deals.
“The two parts should examine investment prospects for the Chinese companies in port development, operation and combined transport in Greece,” he added.
China is the EU’s biggest source of imports and its second-biggest export market. China and Europe trade on average over 1 billion euros a day, according to the European Commission.
Growth in global oil demand more than doubled in the third quarter
Global oil demand in the third quarter of 2019 grew by 1.1 million barrels a day, more than double the 435,000 barrels a day in the previous quarter, according to the latest report from the International Energy Agency (IEA).
China was the largest contributor, with demand increasing by 640,000 barrels a day year-on-year, and the energy agency’s closely-watched report projected a year-on-year acceleration in global growth of 1.9 million barrels per day for the final quarter of 2019.
Supply grew by 1.5 million barrels per day in October as Saudi Arabian production normalized, while Norway, Canada and the U.S. saw marked increases. OPEC crude production came in at 29.9 million barrels a day, down 2.5 million from the same period last year.
The IEA pointed to sluggish refining activity in the first three quarters of 2019 as contributing to a decline in crude oil demand of 300,000 barrels a day year-on-year, and the agency expects crude demand in 2019 as a whole to decline for the first time since 2009.
Crude futures have rebounded somewhat from a sharp decline in August, and on Friday ICE Brent Crude was trading up 12.9% since the start of the year at around $62.45 per barrel. WTI stood just below $57 per barrel, up around 16.5% in the year-to-date.
The IEA said the latest figures highlighted the “increasing disparity between the calm oil market of today and heightened geopolitical tensions.”
“The calmness is supported by a well-supplied market and high inventories. This may continue into 2020 because non-OPEC countries will grow their production by 2.3 mb/d,” the report said.
“The US will lead the way but there will also be significant growth from Brazil, Norway and barrels from a new producer, Guyana.”
OECD oil consumption fell by 590,000 barrels a day year-on-year in August before rising 540,000 barrels a day in September, the largest year-on-year gain in nearly 12 months. However overall, OECD demand contracted for the fourth straight quarter, with Japan showing the sharpest decline at 145,000 barrels a day.
Global debt surged to a record $250 trillion in the first half of 2019, led by the US and China
Global debt hit a record high of over $250 trillion in the first half of this year, led by a surge in borrowings in the U.S. and China, according to a new report.
The report, released by the International Institute of Finance (IIF) on Thursday, showed that global debt surged by $7.5 trillion in the first six months of 2019. The IIF said the overall number hit $250.9 trillion at the end of this period, and will exceed $255 trillion by the end of 2019.
“China and the U.S. accounted for over 60% of the increase. Similarly, EM debt also hit a new record of $71.4 trillion (220% of GDP). With few signs of slowdown in the pace of debt accumulation, we estimate that global debt will surpass $255 trillion this year,” the IIF said in the report.
Rising debt across the world has been a big concern for investors and has also been flagged as the next breaking point by a number of economists. Record-low interest rates make it extremely easy for corporates and sovereigns to borrow more money.
“However, with diminishing scope for further monetary easing in many parts of the world, countries with high levels of government debt (Italy, Lebanon) — as well as those where government debt is growing rapidly (Argentina, Brazil, South Africa, and Greece) — may find it harder to turn to fiscal stimulus,” the IIF report stated.
The International Monetary Fund (IMF) last month escalated its warnings about high levels of risky corporate debt, which have been exacerbated by persistent low interest rates from central banks. The IMF warned that almost 40%, or around $19 trillion, of the corporate debt in major economies such as the U.S., China, Japan, Germany, Britain, France, Italy and Spain was at risk of default in the event of another global economic downturn.
‘Pretty sustainable picture’
However, central bankers don’t seem very worried by these rising debts. On Thursday, Federal Reserve Chairman Jerome Powell said he does not see signs of any bubbles brewing or immediate dangers being posed by trillion-dollar deficits.
“If you look at today’s economy, there’s nothing that’s really booming now that would want to bust,” Powell said in testimony before the House Budget Committee. “In other words, it’s a pretty sustainable picture.”
However, the report from IIF paints a different picture. It states that global government debt will top $70 trillion in 2019, up from $65.7 trillion in 2019, driven higher by the surge in U.S. federal debt.
“The big increase in global debt over the past decade — over $70 trillion — has been driven mainly by governments and the non-financial corporate sector (each up by some $27 trillion). For mature markets, the rise has mainly been in general government debt (up $17 trillion to over $52 trillion). However, for emerging markets the bulk of the rise has been in non-financial corporate debt (up $20 trillion to over $30 trillion).”
The IIF cites the deepening of global bond markets as the reason for the rise in debt levels. The global bond markets increased from $87 trillion in 2009 to over $115 trillion in mid-2019. The growth was mostly seen in the government bond market — which now make up 47% of global bond markets compared to 40% in 2009.
“The bond universe has grown most rapidly in emerging markets, swelling by over $17 trillion to near $28 trillion since 2009,” the report stated.
Global government bond market, especially the so-called safe-haven assets such as U.S. Treasurys have been very crowded lately as investors rush to safer assets amid uncertainty due to Brexit, a global growth slowdown and President Donald Trump’s impeachment inquiry in the U.S.
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