Recommended Weekend Reads

May 17 - 19, 2024

Here are our recommended reads from reports and articles we read in the last week. We hope you find these useful and that you have a relaxing weekend.   And let us know if you or someone you know wants to be added to our distribution list. 

Critical Minerals

• Mineral Demands for Resilient Semiconductor Supply Chains CSIS

  The People’s Republic of China (PRC) is the principal strategic competitor of the United States. In addition to antagonism in other domains, this rivalry entails escalating technological competition. No country is technologically self-sufficient, but the United States’ reliance on China’s considerable market share in the critical minerals industry for semiconductor supply chains creates a dependency that turns a trade imbalance into a potential national security threat. Chips are ubiquitous in all modern technology, and their relevance and worth will only expand in the coming years. The countries that are able to secure their own supply chains for critical technologies will be in a position to write the rules of global economic governance for years to come.

  Americas

• The Woman Inheriting AMLO’s Revolution Foreign Policy

  Most Mexicans began to seriously entertain the idea that Claudia Sheinbaum could be Mexico’s first female president in December 2022, when her trademark slicked-back ponytail began to appear on billboards across the country. Paid for by legislators in Sheinbaum’s party, Morena, the signage was intended to make the former climate scientist and then-Mexico City mayor known nationwide.
  

• Mexico’s Post-Election Fiscal Reality Check   Americas Quarterly

  Mexico is three weeks away from one of its most consequential elections in recent history. Much is at play on June 2, as the outcome of this vote is likely to have economic and political implications that will shape the nation’s future for decades. Why is there so much at stake? From an optimistic perspective, the opportunity nearshoring brings to the country is likely to become more evident in the next six years, but only if the new administration manages to tackle the significant bottlenecks Mexico still faces in broad areas such as energy, infrastructure, security, water, human capital, and its regulatory environment. From a less upbeat vantage point, Mexico’s democracy could be at risk if the election results end up in a landslide.  Notwithstanding the result, no matter who wins the presidential race, the post-June 2 party will likely be short, as the current list of challenges—and inherent risks—the next president will face is probably the most fearsome in 25 years.
  

• War Has Changed. We Didn’t.  That Reality Will Cost Us  Hudson Institute’s Arsenal of Democracy Podcast

  War is rapidly changing. Countries like China are already moving force structure and planning toward a new type of conflict. Meanwhile, the United States overspends and delays the production of systems like aircraft carriers that could soon fall into the category of “a weapon that you can’t afford to lose.” The Sagamore Institute’s Dr. Jerry Hendrix joins the show to explain how the US and its industrial base can change course to prepare for future conflicts before a dangerous “comeuppance” shocks us into action.  This episode features Dr. Jerry Hendrix, a Senior Fellow at the Sagamore Institute.

Russia’s War on Ukraine

• “Russia’s Murky Future”  The Foreign Affairs Interview Podcast

  The noted Russian scholar and biographer of Josef Stalin, Steven Kotkin,  gives a fascinating interview on what is going on inside Russia.  When Russia botched its invasion of Ukraine and the West quickly came together in support of Kyiv, Russian President Vladimir Putin’s grip on power appeared shakier than ever. Last summer, an attempted coup even seemed to threaten his rule. But today, Putin looks confident. With battlefield progress in Ukraine and political turmoil ahead of the U.S. election in November, there’s reason to think things are turning in his favor.

Australia

• Australia’s New Gas Strategy Makes for Flawed Foreign Policy The Interpreter

  The latest Australian federal budget, handed down on Tuesday night, pledges unprecedented support to making Australia a “renewable superpower”. Yet a new gas strategy that preceded it promises to keep Australia and its Asian energy partners tethered to this fossil fuel for decades. While fiscal commitments now favor Australia’s greener energy engagement, Canberra should wind back broader regulatory support to gas. This would quicken the timeframe in which Australia might provide for both the energy security needs of Asia and the climate security needs of the Pacific.

China

• China Has Gotten the Trade War it Deserves   The Atlantic

  A global trade war is starting, and China is at the center of it. A reckoning for Beijing’s economic model, which is designed to promote Chinese industry at the expense of the rest of the world, has long been coming. China’s trading partners have had enough. The result will be a wave of protectionism, with potentially dire consequences for both China and the global economy.

Global Financial Markets and Economics

• Emerging Threats to Financial Markets  RAND

  In early 2021, a freewheeling, freethinking group of investors on Reddit decided to flex some collective muscle. They plowed their money into GameStop, a video game retailer that several big hedge funds had bet against. The stock price shot up, some people made millions—and, to the delight of those on Reddit, the hedge funds had some very bad days.

Asymmetric Threats

• Contested Connectivity: Cyber Threats in the Asia-Pacific   International Institute for Strategic Studies

  Asia-Pacific countries are facing increasing numbers of state-backed hacking operations serving geopolitical and economic purposes. They are also getting better at conducting them. Domestic and foreign-policy ambitions are manifesting in the information space, where state-linked actors are contesting state adversaries, political opponents, and world views both overtly through activities such as defacement (hacking a target website and replacing its content with the hackers’ own message), and covertly, via disinformation operations. While basic cyber best practice is still out of reach for the least cyber-capable states, a couple of regional states could be considered amongst the most cyber capable globally. Forging a greater range of international partnerships between governments and industry is likely to boost the region’s resilience in cyberspace. Political will and geopolitical alignments will likely shape how that unfolds.

Demographics

• Birth Dearth or Baby Boom?   American Enterprise Institute

  Writing in the Wall Street Journal earlier this week, Greg Ip and Janet Adamy explored the possibility that the world’s population may peak and begin to fall far sooner than demographers have previously projected: “The world is at a startling demographic milestone. Sometime soon, the global fertility rate will drop below the point needed to keep the population constant. It may have already happened. Fertility is falling almost everywhere for women across all levels of income, education, and labor-force participation. The falling birthrates come with huge implications for the way people live, how economies grow and the standings of the world’s superpowers.”

• Addressing Demographic Headwinds in Japan: A Long-term Perspective OECD

  Japan faces serious demographic headwinds. Under current fertility, employment, and immigration rates, the population would fall by 45% by 2100 and employment by 52%. Given the challenges of a shrinking and ageing population, the government has pledged to “create a children-first economic society and reverse the birth rate decline”. One priority is to strengthen the weak financial position of youth, which leads many to delay or forgo marriage and children. Making it easier to combine paid work and family is also critical so that women are not forced to choose between a career and children.