La Repubblica, Rome, August 6: President George W. Bush declared on Monday that he remains optimistic about the American economy, but the more he repeats these statements, the more ineffectual they become. The International Monetary Fund has lowered its projections for American growth, and America is on the verge of a relapse into recession.
These nine hundred days of falloff in the market approaches the record of the Great Depression. There are fundamental differences between then and now, but there are also similarities: the risk of war, protectionist tensions that could slow down globalization, xenophobic reactions to immigration, an imbalance of the funds accumulated during the boom.
Gravity of the crisis
Another cut in the interest rate by the Federal Reserve to its lowest level in 40 years only confirms the gravity of the crisis. When the interest rate approaches zero and business investments remain constant, the economy is imprisoned in that which Keynes called "the snare of liquid assets." As in the 1930s, naturally.
O Estado de Sao Paulo, Sao Paulo, August 6: Banks in Montevideo will have returned to normal work when U.S. Treasury secretary Paul O'Neill visits Uruguay this week. Besides supporting an agreement between the International Monetary Fund (IMF) and Uruguay, the United States advanced a dlrs 1.5 billion emergency loan to allow banks to restart operations. Is Washington policy regarding Latin America changing?
If there was a change, it was prompted by the perception of two facts: First, the economic crisis in Argentina was not confined to that country; second, the price of a financial disaster in Brazil would be too high, with repercussions probably all over Latin America.
President George W. Bush's administration in the past few days might have found that Latin America's southern-most region is more important than Washington had thought, but the help to Uruguay came only when that country was on the verge of a deep financial crisis.
O'Neill's main test will be in Argentina, where the U.S. government has contributed to restrict the crisis affecting South America's second largest economy. It is not clear yet if Washington will continue dealing with Argentina as an exceptional case deserving an exceptional punishment. The lack of good will toward Argentina greatly reflects a pretension to give lessons to the world.
Unluckily for the Argentines, their neighbors and perhaps the United States, that attitude produces not only a cruel sacrifice but also a useless one. It is with its policy regarding Argentina that Washington will demonstrate up to what point it has changed the way it deals with South America.
Le Figaro, Paris, August 7: The Salt Lake City Olympics skating scandal is pushing the sport into the dangerous sphere of influence of organized crime. And not just any organized crime since, if one believes the FBI's sleuths, a certain Alimzhan Tokhtakhounov, who allegedly "fixed" the medals, is supposed to be a figure in the Russian mafia.
Organized crime seems to have set its heart on professional sport.
In the face of this transnational dimension to crime, the sporting world is powerless. The national federations on't have the means to flush out the Mafia's stratagems. As for the international federations, judging by the lack of zeal they show when fighting the scourge of doping, it is difficult to imagine them arming themselves against organized crime. In Russia, the few sporting authorities who have dared to stand in the way of the gangsters have died in the attempt.
The Guardian, London, August 7: No one pretends that the Baghdad government is other than an illegal and immoral regime run by a despot. Saddam may be planning more evil deeds. But his is not the only such state with ambitions to arm itself with weapons of mass destruction.
For one country or two countries to appear to launch an attack purely because it satisfies their own self-interest would be immoral, and would create a dangerous precedent. Unlike the expulsion of Iraq from Kuwait, an invasion of Iraq -- as matters stand now -- is unlikely to have unambiguous U.N. backing.
If Prime Minister Tony Blair, the most religious of recent prime ministers, ignores groups politically allied to him and the strong moral guidance of religious leaders, he could land himself in a political and moral morass from which he may never escape.