Israel’s war crimes in Gaza are by design, not default

Energy News Beat

The gruesome scenes of death and destruction in Gaza are a reminder that for Israel, violence is not incidental, accidental or coincidental. It is part and parcel of its colonial DNA.

Like the French in Algeria, the Dutch in Indonesia and South Africa, the Belgians in the Congo, the Spaniards in South America and the Europeans in North America, the Zionists have also dehumanised the natives of the land as a precursor to or justification for guilt-free repression and violence. But colonialism must not be conflated with Judaism. If anything, the Jews have historically been the victims of racism for centuries, rendering many of them anti-colonialists.

In 1948, Israel was established on the ruins of another people, the Palestinians. It was made into a Jewish majority state through the deliberate ethnic cleansing of the land’s 750,000 Palestinian inhabitants. Since then, Israel has maintained security through state repression, military occupation, bloody wars and countless massacres against civilians.

Nazareth, the city of my birth, was one of the few to be spared from ethnic cleansing but only because a military commander named Benjamin Dunkelman, a Canadian Jew who led the 7th Brigade of the Israeli army, refused to carry out his superiors’ evacuation order for this Christian majority city, as he later wrote, mainly out of fear of the international repercussions.

About 400 other Palestinian towns and villages were not so lucky. They were all depopulated, and a majority was entirely decimated. Their inhabitants were either killed or kicked out. The properties in them were either demolished or confiscated. They were given new Hebrew names. Those Palestinians who tried to return to their homes were either shot or forcibly sent to neighbouring countries.

In his book, Sacred Landscape: The Buried History of the Holy Land Since 1948, Meron Benvenisti, an Israeli political scientist, writes: “Not since the end of the Middle Ages had the civilised world witnessed the wholesale appropriation of the sacred sites of a defeated religious community by members of the victorious one.”

Since then, Israel has set its eyes on the people per se, regardless of its leadership or theirs. Palestinians are seen by Israel either as an enemy from within that must be eradicated or as a demographic threat that needs to be removed. It is no coincidence that since its inception, Israel has established an oppressive regime of “Jewish superiority”. This regime was extended after the 1967 war and occupation to the entirety of historic Palestine, from the Jordan River to the Mediterranean Sea. Hence the Palestinian cry, “From the river to the sea, Palestine will be free.”

For decades, Israel has used disproportionate force and carried out countless massacres against Palestinian civilians as a form of revenge, punishment and deterrence. Last month, the Palestinians commemorated the 70th anniversary of the massacre of Qibya, where, in retaliation for a Palestinian attack on an Israeli settlement that killed three people, including two children, Israeli forces under the leadership of Ariel Sharon attacked the West Bank village of about 2,000 inhabitants, killing 69 Palestinians, mostly women and children.

That same vengeful mindset has been applied 70 years later in Gaza. It is a deterrence strategy, deliberately aimed at harming civilians to distance them from their leaders and the groups fighting in their name. Today, the Israeli propaganda machine is busy collating desperate and angry cries, real and manufactured, from Gaza residents projecting blame on Hamas for bringing Israel’s wrath upon them.

Israel never accepts an “eye for an eye” in its confrontations with the Palestinians. It insists on a ratio of 1 to 10 or 20 when it comes to its civilian casualties vs Palestinian civilian casualties. Hence, the Palestinian civilian must pay a heavy price in each and every clash, regardless of any moral or legal consideration.

Nowhere is the dissymmetry more pervasive than in Israel’s 56-year military occupation of the West Bank and Gaza, which by its very nature is a perpetual system of violence against civilians. Generation after generation of Palestinians have had to endure a racist, gruesome and illegal military occupation that has included daily humiliations, collective punishment, land confiscations, and the destruction of lives and livelihoods. For Gaza, this has meant a 17-year siege of the strip through a dreadful and inhumane military blockade, military incursions, bombings of civilian infrastructure and more.

Although Israel claims it has “no choice”, its occupation is in fact driven by strategy, not by necessity. Throughout the past six decades, Israel has controlled the Palestinian territories in part to colonise them through hundreds of illegal settlements on stolen Palestinian lands, in part to hold their population hostage until their leaders accept its political dictates, which is by definition a form of state terrorism, which means using violence against civilians for political ends.

Another important factor behind Israel’s violence against Palestinian civilians, as I explained here, is hatred – hatred that is propelled by fear, envy and anger.

Israel fears all that is Palestinian steadfastness, Palestinian unity, Palestinian resistance, Palestinian poetry and all Palestinian national symbols. Such fear generates hatred because a state that is always afraid cannot be free. Israel is angry at the Palestinians for refusing to give up or give in, for not going away – far away. They refuse to cede their basic rights, let alone concede defeat. Israel is also envious of Palestinian inner power and outward pride. It is envious of their strong beliefs and readiness to sacrifice.

In short, Israel hates the people of Palestine for impeding the realisation of the Zionist utopia over all historical Palestine. And it especially hates those living in Gaza, as I wrote last year, for turning the dream into a nightmare.

But the answer in Gaza and the rest of Palestine cannot be more killing and more occupation. In fact, Israel’s ongoing industrial-scale slaughter and nationwide repression of the Palestinians, in retaliation of Hamas’s gruesome October 7 attacks in southern Israel, is both utterly criminal and terribly foolish. Israel has tried to live by the sword for the past 75 years, but it has sowed more of the same insecurity, infamy and anger. Repeating the same strategy again and again and expecting different results is indeed stupid. If it continues to deny the Palestinians a life and a future, Israel also will end up with no life or future worth living in this Arab region.

 For Israel, violence is not incidental, accidental or coincidental. It is part and parcel of its colonial DNA.

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Colombia’s ELN rebel group free father of Liverpool footballer Luis Diaz

Energy News Beat

The Colombian government says the National Liberation Army (ELN) rebel group has released the father of Liverpool footballer Luis Diaz after kidnapping him nearly two weeks ago.

In a statement on Thursday, a Colombian delegation that has been negotiating with the ELN in pursuit of a peace deal welcomed the release of Luis Manuel Diaz but said his kidnapping “should never have happened”.

Local television channels showed Diaz’s father at an airstrip in the city of Valledupar on Thursday after exiting a helicopter. The Liverpool and Colombian national football team striker had implored the kidnappers to release his father, who was taken hostage at gunpoint in northern Colombia on October 31.

Manuel Diaz’s wife, Cilenis Marulanda, was also taken hostage but was rescued several hours later. The Colombian government had pressured the ELN to release Manuel Diaz, whose kidnapping set back efforts to negotiate a lasting peace with the rebel group.

“The current process with the ELN has advanced like no other until today. Regardless, our delegation considers that the kidnapping of Luis Manuel Diaz has placed our dialogue in a critical situation, and because of it, the time has come to take decisions to eliminate kidnapping,” the statement from the government delegation said.

A six-month ceasefire between the government and the ELN had been reached in August as Colombia tries to move away from a military-focused approach to armed groups like the ELN that helped fuel a civil conflict that killed more than 450,000 people over a 60-year period.

“Long live peace and freedom,” Colombian President Gustavo Petro, who has remained committed to his strategy of seeking “total peace”, said in a social media post after the release of Manuel Diaz.

The government’s statement said all remaining hostages held by the ELN must be freed, but it did not offer an estimate of how many people are still being held.

After news of his father’s kidnapping, Luis Diaz received statements of support from fellow footballers and fans around the world.

Colombian authorities had launched a search for Manuel Diaz, and the head of the ELN had acknowledged that his kidnapping was a “mistake”.

In his first appearance for Liverpool since the kidnapping of his father, Diaz scored an equalising goal against Luton in the Premier League and lifted up his shirt to reveal the message “Libertad Para Papa”, or “freedom for papa”.

In a social media post after the match, Diaz pleaded for his father’s release.

“Today the footballer is not speaking to you. Today Lucho Diaz, the son of Luis Manuel Diaz, is speaking to you. Mane, my dad, is a tireless worker, a pillar in the family, and he has been kidnapped,” it read.

“I ask the ELN for the prompt release of my father, and I ask international organizations to work together for his freedom.”

Striker’s father had been taken captive by the guerrilla group in northern Colombia last month.

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Analysis: How would Israel find, map, take and keep Gaza’s tunnels?

Energy News Beat

A week after Israeli troops encircled Gaza City and cut it off from the southern part of the Gaza Strip, there seems to be no evidence of a serious attack towards the centre.

On Wednesday, a select group of Israel-based foreign reporters was taken to a section of the battlefield, which journalists described as “the fringes of Gaza City”. Nearly every building was destroyed or heavily damaged by aerial bombardment, artillery fire or advancing tanks and infantry.

Videos show Merkava tanks grouped in an encampment surrounded by tall sandy berms, almost certainly constructed by the armoured combat bulldozers routinely deployed with advance units. The defensive sand walls are likely to deny Hamas fighters the opportunity for hit-and-run attacks.

To an analyst, the position and posture of that 401st Brigade company show more than the Israelis probably wanted to. It tells us the advance will be slow, street by street rather than block by block.

It also proves that Gaza City’s hardest battle, the underground one, has not begun in earnest. Some tunnels may have been identified and destroyed as troops advanced, but that is likely a tiny part.

The 34 Israeli soldiers whom Israel has admitted have been killed so far were apparently killed individually or in small groups – when tunnel war begins, the numbers are likely to jump in bigger groups.

To enter the tunnels, Israeli forces will have to resort to military practices decades old and long forgotten to get around the challenges of fighting underground.

Identifying entrances

To gain a position to fight in the tunnels, Israel has to identify as many entrances as possible. For a system believed to be up to 500km (310 miles) long, those probably number in the tens of thousands.

Most are hidden, inside residential buildings, garages, industrial facilities, warehouses, under rubbish dumps and, after more than a month of bombardment, under heaps of rubble.

But Israel has been preparing to tackle the tunnels since the 2014 incursion into Gaza. Incessant surveillance by drones, using sophisticated software that analyses movement patterns and can recognise individual faces and match them to a database of known Hamas members, revealed hundreds or thousands of entrances.

Informants probably added more, and I would not be surprised if the Weasels (Samur) specialised Israeli tunnel-warfare unit, knows half the tunnel access points.

Mapping the tunnels

Knowing the entrances is useful, but even if all known ones were attacked, that would not make the tunnels unusable for Hamas. Most tunnels have several entrances at each end so some would always remain open.

The tunnel builders, Hamas, have a huge advantage as they know the network. Israeli software might offer hints connecting patterns of movement to reveal that two points are probably connected, but it does not reveal the underground routes, directions, or junctions.

To map the tunnels with whatever degree of accuracy, commandos must get inside, facing huge dangers and difficulties. The first is technical: Down there, GPS positioning devices are useless as satellite signals cannot penetrate the soil.

The solution will most probably use devices that combine magnetic sensors, not affected by going underground, and movement sensors like those used in step counters. A crude and imprecise system, but better than nothing.

Getting around

Once inside, the Weasels will most likely operate with night-vision goggles rather than give away their position using lights. They will not be able to use radios to communicate with units on the surface, so they will have to use field telephones, technology from over 100 years ago.

Soldiers will unroll wires, connecting them on the move, further slowing the advance. Even if they do not meet Hamas resistance, they must stop at every junction and assess where the branches lead.

A small force will have to be left at every side tunnel to defend from counterattacks. Every time they find a vertical shaft, which are almost always used for entrances, they will have to pause, map the position and relay it back to units on the surface.

Surface units will have to find the opening and secure it; if it is in territory not controlled by the Israeli army, they will either have to take it or tell the tunnellers to stop or go around it. This will repeat hundreds of times. In the past, Samur released videos of its tunnel-capable robots that might be useful as trailblazers, reconnoitring passageways and sending back night-vision videos. But they can be used on one level only, as they cannot climb ladders or obstacles.

Surviving inside

For practical purposes, everything has been analysed so far assuming that there is no opposition in the tunnels. That is completely unrealistic: Hamas has surely prepared to put up fierce resistance.

Most tunnels are probably booby-trapped with pre-positioned improvised explosive devices (IEDs). Those can be wired to remote detonators, but they can also be triggered by specialised detonators that react to light, vibration, noise, movement, and even increased carbon dioxide concentration when people are present.

The tunnels are laced with wires and cables that carry electricity, internet, telephones and military lines. Hamas may have observation and detection devices that would let them know where the Israelis are so they can remotely explode charges in that exact spot.

Israelis cannot simply cut all the wires because, like in movies, some detonators might be triggered when their electrical supply is severed. As everyone with a connection to mining knows, explosions in confined tunnels are far deadlier than on the surface. They spread further and suck out oxygen so those who survive the initial blast often suffocate.

Hamas may also ignite incendiary compounds that deprive occupants of oxygen and spread as high-speed flash fires or create thick, often toxic smoke. This would keep the tunnels mostly undamaged, allowing the Palestinian fighters to use them after they force the enemy out.

The Weasels will almost certainly have breathing apparatuses but wearing cumbersome masks and air tanks makes communication and combat more difficult.

An Israeli mobile artillery unit is seen in a position near Gaza, October 28, 2023 [Tsafrir Abayov/AP Photo]

Forcing Hamas out

Every commander, on both sides, prefers to avoid fighting in tunnels. Hamas probably cannot prevent Israelis from entering some tunnels but can try to deny them the freedom to operate in them.

Israeli command knows that its advantage in technology and weapons is considerably higher on the ground than under it, so it would prefer to flush Hamas out and fight on the surface. To do so, it may use chemical agents such as teargas, a little of which goes a long way in tight tunnels.

It is likely Hamas does not have enough protective gear for its tunnel fighters, so any gas-based agent could be effective. Even though Israel does not feel constrained by international conventions, as it does not regard Hamas as a legal combatant, I do not think it would use lethal gasses. That would cause additional international accusations that would be hard to deny.

Water has often been used in the past to flood tunnels and force their occupants out but there is simply not enough water in Gaza. But there may be other options. Egypt is said to have poured sewage into smuggling tunnels from Gaza.

Fighting

Urban fighting is difficult, requiring specific knowledge and equipment; tunnel combat is even more challenging and specialised. As military tunnellers found years ago, ordinary weapons are too big and cumbersome to use in confined spaces.

American Tunnel Rats in Vietnam often only used pistols but found that, when they fired, the flash destroyed their night sight for a long time. When using night vision goggles the problem is even worse, so it is likely that Israelis will carry smaller calibre weapons with sound suppressors, not so much to decrease noise as to prevent muzzle flashes.

Whatever firearms they choose, tunnel fighters will have limited firepower as only two can fire at a time, one kneeling, the other standing over them, blocking the field of fire for the rest of the team.

Hand and rifle grenades are almost certainly out, as well as any kind of rocket launchers. Stun and flash grenades might give the Weasels an advantage by rendering the enemy temporarily deaf and blind, but it is questionable if those can be used without danger to their own side.

In line with centuries-old practice, they will certainly be equipped with combat knives or machetes, as hand-to-hand fighting is certain to happen. There has been much talk about Israeli tunnelling attack dogs, but a military and police canine expert I talked to dismisses the idea.

Dogs are far too unpredictable in conditions of extreme combat stress and there were many cases when under flashes and noise of a firefight they turned against their own side, he explained.

Smoke rises after an Israeli air raid in Tel al-Hawa, in the southern part of Gaza City, November 9, 2023 [Ali Jadallah/Anadolu]

Destroying tunnels

Hamas needs the tunnels and might only want to block some of them tactically but not destroy them altogether using small explosions to prevent the enemy from using a particular tunnel.

Digging under combat conditions is impractical and makes the diggers vulnerable the moment the obstacle is removed, so a blocked tunnel is likely to remain so for the duration of conflict. Israeli combat engineers had announced that they were testing a “sponge bomb”, a device containing two chemical substances that create rapidly expanding foam.

The idea is to instantly create a concrete-hard plug to block the tunnels, but there were mishaps in use, and it is not certain if the sponge bomb is ready for deployment. Rather than just block it, Israel wants to destroy every tunnel it takes, so it will have to make sure that the entire structures are caved in, not just the entrances.

In most cases, this cannot be done by simply placing explosives inside tunnels. For more permanent demolition, it is usually necessary to dig deep holes in tunnel walls and ceilings, fill them with blasting dynamite and detonate so that deep structure is shaken and soil caves in to fill it.

It looks quite implausible to embark on such a massive engineering undertaking during fighting, so Israel might see its task as first destroying Hamas fighters and then demolishing their entire underground network.

To get to the latter part might take Israel months and it must win the underground war first, something that will also take time.

To enter Hamas tunnels, Israel will have to resort to military practices decades old and long forgotten.

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Deadly assault on Jenin refugee camp as West Bank raids intensify

Energy News Beat

At least 10 Palestinians have been killed and 20 others injured during a raid by Israeli forces in Jenin city and refugee camp in the occupied West Bank, the Palestinian Ministry of Health has said.

Intense fighting was reported in the camp on Thursday. Black smoke was seen rising over the city amid multiple explosions and gunfire.

“Occasionally, you can hear gunshots, there are explosions, and you can listen to an Israeli military drone overhead,” Al Jazeera’s Bernard Smith reported from Jenin. “It all started in the early hours of this morning with a raid on the camp. Nothing unusual about that – raids are a fact of life in the occupied West Bank, particularly here in Jenin.”

“But we’re told the military came in and left behind special forces who were looking for Palestinian fighters. Once they were spotted, the special forces called for backup, and this major gun battle has been going on since then,” Smith said.

Israel’s military said it was conducting counterterrorism raids in Jenin, but gave no further details.

“The Israeli army will always say they are going after what they call ‘Palestinian terrorists’, and that’s the purpose of these raids. But since October 7, they have stepped up operations. While they’re happening all over the occupied West Bank, most of them are here in Jenin, where there are different armed groups,” according to Smith.

Palestinian news agency Wafa reported that a large number of Israeli troops entered the camp, accompanied by a bulldozer. Snipers positioned themselves on rooftops as the bulldozer proceeded to destroy roads and infrastructure.

Palestinian news outlet Quds Network posted footage of the moments after Israeli forces bombed a house in the Jenin camp.

In the video posted to social media, smoke can be seen billowing out of a building after it was hit by what the network says was an Israeli drone. Live shots were fired in the ensuing clashes.

“Israeli raids in the occupied West Bank have intensified in the last three hours,” Al Jazeera’s Mohammed Jamjoom reported from Ramallah.

“Witnesses in Jenin are reporting explosions, at least five in the last half hour alone, and attribute them to armed Israeli drones,” he added.

“Israeli forces have also dropped leaflets saying that the raids will only intensify.”

The Palestine Red Crescent Society (PRCS) said a paramedic was injured with live bullets when an ambulance came under fire during the raid.

Hamas, which governs the Gaza Strip, has condemned the deadly raid on the densely populated camp, where about 14,000 people live.

“The occupation that suffers defeat in Gaza will also suffer defeat in Jenin and will not succeed in breaking the will of our people from Gaza to the West Bank,” the group said in a statement.

Dozens of Palestinians have been killed in recent months by Israeli forces in Jenin, particularly in the city’s refugee camp where armed groups are present alongside tens of thousands of residents.

Since the war began on October 7, Israeli forces have arrested more than 2,000 people across the West Bank, according to the Palestinian Prisoners’ Club advocacy group.

The Israeli military has put the figure at more than 1,000 and said most are affiliated with Hamas.

At least 174 Palestinians and three Israelis have been killed across the West Bank since October 7, when Hamas launched an attack on southern Israel that killed more than 1,400 people, mostly civilians.

Since then, Israel has launched an air and ground assault on Gaza that has so far killed at least 10,812 Palestinians, including more than 4,400 children. At least 1.5 million Palestinians in Gaza are now internally displaced, according to UN estimates, as large swaths of the besieged territory lie in ruins.

At least 10 Palestinians have been killed and 20 wounded, including a paramedic, as Israeli army steps up raids.

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Israel to begin daily four-hour ‘pauses’ in fighting in north Gaza, US says

Energy News Beat

Israel has agreed to begin daily four-hour pauses in fighting in northern Gaza to allow people to flee hostilities, the White House has announced, in what it called a step in the right direction.

US National Security Council spokesperson John Kirby said the first humanitarian pause would be announced on Thursday, adding that Israel had committed to announcing each four-hour window at least three hours in advance.

“We’ve been told by the Israelis that there will be no military operations in these areas over the duration of the pause, and that this process is starting today,” Kirby said.

US President Joe Biden told reporters that he had asked Israel for a “pause longer than three days” during negotiations over the release of some captives being held by Palestinian group Hamas, but he ruled out the chances of a general ceasefire.

Kirby made clear that there would be no ceasefire between Israel and Hamas, saying it would help the Palestinian group “legitimise what they did” on October 7, “and we simply are not going to stand for that at this time”.

Biden had asked Israeli Prime Minister Benjamin Netanyahu to institute the daily pauses during a call on Monday.

Biden, when asked if he was frustrated by Netanyahu over the delays in instituting humanitarian pauses, said, “It’s taken a little longer than I hoped.”

‘No ceasefire’

Meanwhile, Israel said it has not agreed to any ceasefires, but will continue to allow brief, localised pauses to let in humanitarian aid.

“There’s no ceasefire, I repeat there’s no ceasefire. What we are doing, that four-hour window, these are tactical, local pauses for humanitarian aid,” Israeli military spokesperson Richard Hecht said.

Taher al-Nono, a political adviser to Hamas leader Ismail Haniyeh, said on Thursday that unspecified negotiations were continuing and no deal had been reached with Israel so far.

He gave no more detail in a statement posted on the group’s Telegram channel.

Reporting from Washington, DC, Al Jazeera’s Kimberly Halkett said these pauses “will allow for the potential release of captives that Hamas is currently holding … and for medicine and food to get in and for those living inside Gaza who have dual nationality to get out”.

“The United States also said it aims to get 150 aid trucks in Gaza daily,” she added.

At least 10,812 Palestinians have been killed in Israeli attacks on Gaza since October 7. In Israel, the death toll over the same period stands at more than 1,400.

A spokesperson for UN Secretary-General Antonio Guterres said any humanitarian pauses should be done in coordination with the United Nations to be most effective.

Stephane Dujarric added that “obviously, in order for this to be done safely for humanitarian purposes, it would have to be agreed with all parties to the conflict to be truly effective.”

‘Pause is meaningless’

Marwan Bishara, Al Jazeera’s senior political analyst, called the US announcement a distraction.

“There’s an unravelling genocide in Gaza and we’re talking about some humanitarian pause, which is absolutely meaningless. [What] we should be focused on is the ongoing genocide, the ongoing killing, the ongoing expulsion, the ongoing ethnic cleansing, the mass slaughter of children,” Bishara said.

“This is the thing that’s going on while Mr Biden [is] and Mr Netanyahu is wasting everyone’s time about some four-hour humanitarian pause.”

Bishara added that the discourse has highlighted how unable – and unwilling – the Biden administration has been to pressure the Israeli government to end the conflict.

“I think it doesn’t have the will and I think it doesn’t want to seem like, in Washington, there’s daylight between the United States and Israel,” he said. “And because this administration has widely and foolishly, in my opinion, boxed itself in behind Netanyahu, and now is finding it difficult to distance itself without looking foolish.”

The US announcement has fallen woefully short of the needs in Gaza, Abdel Hamid Siyam, a Middle East expert at Rutgers University, told Al Jazeera.

“Pauses are not a solution,” he said, adding that what is needed is a “ceasefire so that humanitarian aid can come in uninterrupted, that foreigners can leave the country, and maybe negotiations can take place”.

“If this is only a pause to allow people to move from the north to south, it did not work in the past, it will not work in the future,” he said. “In four hours, people cannot come. They don’t have cars, they don’t have fuel. It’s not going to work.”

“There is mounting pressure on Israel now to open up for a real ceasefire, a real truce for a day or two or three. I think that is coming in the next few days,” he said.

Negotiations over captives

Indirect talks were taking place in Qatar – which also played a role in the freeing of four captives by Hamas last month – about a larger release of hostages.

CIA Director William Burns was in Doha on Thursday to discuss efforts to win the release of captives in Gaza, with the Qatari prime minister and the head of Israel’s Mossad intelligence agency, according to a US official.

Burns met Mossad chief David Barnea and Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani, said the official, who talked to The Associated Press on the condition of anonymity to discuss sensitive matters. Qatar is a frequent go-between in international dealings with Hamas.

White House says Israel commits to announcing each window at least three hours in advance.

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New Zealand crush Sri Lanka to put one foot in Cricket World Cup semifinals

Energy News Beat

New Zealand have returned to their winning ways at the Cricket World Cup following a four-match slump as they defeated Sri Lanka by five wickets at the M Chinnaswamy Stadium in Bengaluru and all but secured their place in the semifinals.

Opening batsmen Devon Conway (45) and Rachin Ravindra (42) got fourth-placed New Zealand’s chase of 172 off to a fast start, and Daryl Mitchell (43) took them close before they crossed the finish line in 23.2 overs on Thursday.

Victory left New Zealand on 10 points – in pole position to claim the last semifinal spot and join India, South Africa and Australia. Pakistan will now need to beat England by an almost impossible margin to leapfrog New Zealand on net run rate.

Afghanistan, who also had slim hopes of qualifying for the knockouts, find themselves in a similar position as their Asian neighbours before their clash with South Africa.

“Really good performance,” New Zealand skipper Kane Williamson said. “The early wickets and spin was a challenge through those middle overs. The pitch really slowed down later.

“The guys showed some good intent later with the chase, so great performance overall. We thought there was going to be some weather later, but there wasn’t any. Hard to read such things.”

Earlier, seamer Trent Boult and off-spinner Mitchell Santner landed timely blows as Sri Lanka limped to 171 all out after an early blitz by Kusal Perera (51) and a defiant late effort by Maheesh Theekshana (38 not out).

“Nice to get a bit of success at the top. A must-win game, the pleasure is about getting the result,” said man-of-the-match Boult, who went past 600 international wickets.

Barring an unlikely miracle in Pakistan’s last game, New Zealand will take on hosts India in the first semifinal in Mumbai on Wednesday while South Africa will play Australia in the second semi in Kolkata on November 16.

“Everyone wants a piece of the strong home nation,” Boult said. “We’re looking forward to it. It’ll be exciting to face India in the semifinals. They’re playing phenomenal cricket.”

Williamson’s decision to bowl after winning the toss paid off early as Boult (3-37) and Tim Southee (1-52) tore through the Sri Lanka top order to leave them in some trouble at 32-3 inside five overs.

Perera, who was dropped on zero by Tom Latham in the second over, punished New Zealand with a 22-ball fifty but lost another partner when Boult trapped Charith Asalanka LBW to turn up the heat on the 1996 champions.

A fit-again Lockie Ferguson (2-35) struck in his second over to dismiss the aggressive Perera as Sri Lanka collapsed to 70-5  and eventually folded in the 47th over for a modest total after Santner (2-22) and Ravindra (2-21) joined the party.

Santner curtailed Sri Lanka during a crucial phase of the innings and removed Angelo Mathews (16) and Dhananjaya de Silva (19) before Theekshana and Dilshan Madushanka (19) frustrated New Zealand with a 10th-wicket stand of 43.

Sri Lanka’s hopes of securing qualification for the 2025 Champions Trophy were dealt a blow. They needed a win to boost their chances of finishing in the top eight at the World Cup but finished ninth after completing nine league games.

Sri Lanka are equal on four points with England, Bangladesh and the Netherlands but are ahead of the Dutch only on run rate and will now depend on the last matches of those three sides to qualify.

The top eight teams in this World Cup – including hosts Pakistan – will qualify for the Champions Trophy.

“In the first 10 overs, we lost three, four wickets and struggled with the bat,” Sri Lanka captain Kusal Mendis said.

“If we had a good partnership in the middle overs, we could have had 300-plus on this wicket.”

 Trent Boult picks up 3-37 as the Kiwis win by five wickets and edge closer to the last remaining semifinal spot.

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Hillary Blasted For Comparing Trump To Hitler (Again!)

Energy News Beat

Authored by Steve Watson via Summit News,

Presidential loser Hillary Clinton was slammed online Wednesday after once again lazily claiming that Donald Trump is like Hitler.

Clinton cackled along with the women on The View like a coven of witches, before turning her attention to Trump, who it seems still lives rent free inside her head.

“Hitler was duly elected, right?” Hillary declared, adding “And so all of a sudden, somebody with those tendencies, the dictatorial, the authoritarian tendencies would be like, ok, we’re gonna shut this down, we’re gonna throw these people in jail and they usually don’t telegraph that.”

She continued, “Trump is telling us what he intends to do! Take him at his word! The man means to throw people in jail who disagree with him! Shut down legitimate press outlets! Do what he can that literally undermine the rule of law and our country’s values!”

WATCH:

Elsewhere the witches and Clinton salivated over locking Trump up to stop people voting for him, with Hillary declaring “I think it would be the end of our country as we know it” if Trump were reelected:

The backlash was swift and stinging:

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Why Latin America’s ‘pink tide’ is taking a stand against Israel

Energy News Beat

Bogota, Colombia – As Israel’s bombardment of Gaza enters its second month, world leaders have increasingly voiced concern over the rising death toll and suspected human rights violations in the Palestinian territory.

But in the West, few have been as vocal — or as severe in their criticism — as the leftist leaders in Latin America, many of whom came to power as part of a progressive wave known as the “pink tide”.

On October 31, Bolivia severed its diplomatic relations with Israel, citing “the aggressive and disproportionate Israeli military offensive taking place in the Gaza Strip”. Colombia and Chile echoed that criticism, recalling their diplomats from Israel the very same day.

“If Israel does not stop the massacre of the Palestinian people, we cannot be there,” Colombian President Gustavo Petro posted on the social media platform X.

His message came minutes after his Chilean counterpart, Gabriel Boric, denounced the Israeli offensive as a “collective punishment on the Palestinian population in Gaza”.

Analysts said these acts of censure send a powerful signal from Latin America, a region that has largely maintained close, if sometimes tense, ties with Israel.

“It speaks to a Latin America that is not willing to tolerate such obvious violations of human rights and international humanitarian law,” said Mauricio Jaramillo, an international relations expert.

Colombian President Gustavo Petro has denounced the ‘massacre’ of Palestinians in Gaza [Marco Ugarte/AP Photo]

The Latin American leaders’ sharp rhetoric, he added, stood in stark contrast with statements from other Western leaders, like United States President Joe Biden, who have been more circumspect in their criticism of Israel.

In response to Latin America’s diplomatic backlash, the Israeli Ministry of Foreign Affairs called on Colombia and Chile to support its right “to protect its citizens”. To do otherwise, Israel suggested, would be to align “with Venezuela and Iran in support of Hamas terrorism”.

It also called Bolivia’s decision to cut relations altogether “a surrender to terrorism”.

Bolivia, Chile and Colombia were not alone in their criticism. By Friday, the leftist government in Honduras had likewise pulled its ambassador from Israel for “consultations”. And after last week’s bombing of Jabalia, Gaza’s largest refugee camp, more left-leaning leaders from Latin America spoke out against the Israeli violence.

The Ministry of Foreign Affairs in Argentina, for instance, home to the largest Jewish community in Latin America, condemned the attack in a statement: “Nothing justifies the violation of international humanitarian law.”

Leaders from across the western hemisphere, including Colombia’s Gustavo Petro and Chile’s Gabriel Boric, gather at the White House on November 2, 2023 [Andrew Harnik/AP Photo]

Cold War legacy on left-wing politics

The current conflict in Gaza, however, is not the first time Latin America’s leftist leaders have taken a stand against Israel.

Jaramillo pointed out that Cuba’s Fidel Castro became the first Latin American leader to break relations with Israel back in 1973.

Announced in the midst of the Cold War, Castro’s decision served as a rebuke both to Israeli aggression in the Middle East and to its biggest ally, the US — Cuba’s adversary at the time.

The legacy of the Cold War has primed Latin America’s leftist leaders to be sympathetic to the Palestinian cause, according to Jehad Jusef, the vice president of the Palestinian Union of Latin America, an association of Palestinian diaspora groups.

During the Cold War, the US backed military dictatorships in Latin America that suppressed leftist movements, Jusef said.

That history, he argued, serves as a parallel for the modern-day situation in Gaza, where the US is supporting Israel in a campaign that has raised grave human rights concerns.

Israel played its own role in Latin America’s Cold War period, serving as a major arms dealer to the US-backed military dictatorships in places like Guatemala and Argentina.

“Imperialism in Latin America is the same as imperialism in the Middle East,” Jusef said.

Protesters in Bogota, Colombia, hold a candlelight vigil for Palestinian civilians amid the ongoing war in Gaza [Ivan Valencia/AP Photo]

Experiences with displacement

Experts said Israel’s settlement of Palestinian territories has also fostered a sense of recognition among Latin American leaders.

Hundreds of thousands of Palestinians faced displacement during the 1948 establishment of the state of Israel after a period of prolonged Western involvement in the region. The UN continues to denounce the expansion of Israeli settlements in Palestinian territories like the West Bank as illegal.

That history resonates in Latin America, where an estimated 42 million people identify as Indigenous. They too continue to grapple with a legacy of dispossession from their ancestral lands and racial discrimination, as part of European colonisation.

“Progressive movements in Latin America approach the Palestinian cause as one of decolonization,” said Manuel Rayran, an expert in international relations. “They identify with that cause because [many of the inequalities] seen in Latin America today are inherited from colonialism.”

Some political analysts like Cecilia Baeza have noted that Indigenous groups have even taken a leadership role in supporting Palestinian causes.

“In Chile and Bolivia, where this political convergence is particularly strong, it is not unusual to see Palestine solidarity protests called by both Palestinian diaspora organizations and Indigenous movements,” Baeza wrote in a 2015 article.

Bolivian President Luis Arce severed relations with Israel in response to the ‘aggressive and disproportionate’ violence in Gaza [File: Mike Segar/Reuters]

Political divides shape Israel relations

Support for the Palestinian cause also falls along stark ideological lines in Latin America.

In the case of Bolivia, the country’s first Indigenous president — the socialist Evo Morales — was also the first to sever relations with Israel in 2009.

But his successor, the right-wing Jeanine Áñez, decided to renew ties within weeks of taking office.

The country’s current president, Luis Arce, is considered part of the present-day “pink tide”.

This leftward trend began with the election of President Andrés Manuel López Obrador in Mexico in 2018 and continued with leftist victories in Argentina, Bolivia, Peru, Honduras and Chile.

In Colombia, the 2022 swing to the left was particularly historic: Never before had a left-wing president taken office.

But Petro’s victory in Colombia has shown some of the weakness of the latest “pink tide” movement.

A demonstrator shows support for Israel outside the country’s embassy in Bogota, Colombia, on October 9 [File: Ivan Valencia/AP Photo]

Breaking ties comes at a cost

Only a year into his term, Petro’s approval ratings have plummeted to 32 percent, as he struggles to implement his domestic platform against a strong right-wing backlash.

While opposition leaders in Colombia have accused Petro of using the crisis in the Middle East to divert attention away from his domestic troubles, Elizabeth Dickinson, a senior analyst for the think tank Crisis Group, questioned that logic.

She argued that — instead of winning public opinion points at home — Petro’s decision to take a stand against Israel could come at a cost.

After Petro compared remarks made by the Israeli defence minister to those made by Nazis, Israel suspended its military exports to Colombia, including the sale of planes and machine guns used in the government’s efforts against rebel forces.

Actions and comments from other Latin American leaders could lead to similar repercussions, Dickinson warned. Israel’s defence exports alone are a $12.5bn industry.

“This is not an easy or obvious decision,” she said. “It’s clearly a political choice that these leaders have made despite the possible risks to their own interests.”

The diplomatic rebuke from countries like Colombia, Chile and Bolivia is unlikely to deter Israel from escalating the war, she added.

“These are countries that don’t have a definitive economic or political relationship [with Israel] that could shift the conflict in one way or another,” Dickinson said.

It does, however, build pressure on the US, Israel’s closest ally, to call for a ceasefire.

Dickinson said she suspected that the South American countries timed their actions to coincide with an international summit in Washington last Friday. Both Petro and Boric used the meeting to encourage their US counterpart to condemn Israeli actions.

“It’s a point of entry for Latin American leaders to push this forward with the United States,” Dickinson said.

Leftist leaders like Colombia’s Gustavo Petro and Chile’s Gabriel Boric have condemned Israeli violence in Gaza.

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Rubino: Are There Too Many People Or Too Few?

Energy News Beat

Via John Rubino’s Substack,

With financial collapse and global war inching closer every day, you’d have to be an anxiety junkie to worry about distant things like demographic trends.

Still, the population debate is interesting, with economists, statisticians, and techies disagreeing over whether the world of 2100 will have too many people, too few, or just the right number. To summarize the three scenarios:

Too many people. We already exceed the Earth’s carrying capacity and developing country populations will continue to increase for at least the next half-century, leading to mass extinctions, degradation of farmland and aquifers, and widespread famine. Meanwhile, automation will eliminate millions of jobs, causing mass unemployment, civil unrest, and bankrupt governments. This is “negative feedback loop” all the way down.

Too few people. Birth rates are plunging and by mid-century there won’t be enough young workers to support a growing number of retirees, resulting in a global inflationary depression and/or massive cuts in social programs that leave millions of retirees destitute.

Just the right number. The workforce shrinks while automation eliminates jobs, keeping labor markets more or less in balance. Productive capacity expands, retirees are supported, and the environment starts to heal.

It really does matter which of these actually happens.

How we got here

The human population has exploded thanks to industrialization, fossil fuels, and better public health:

But now birth rates are plunging. A population is stable when the typical woman has 2.1 kids. During the past few millennia, that number was obviously a lot higher (see above). But lately, birth rates have plunged, with the “replacement rate” threshold just a few years off.

Here in the US, we’re tracking the global rate pretty closely:

Why the sudden fertility collapse?

The short answer is urbanization. In agricultural societies, children are free labor so people have lots of them. When people move from farms to cramped apartments in crowded cities, kids are more trouble than they’re worth, so families shrink. Today’s world is rapidly urbanizing, so fertility rates are plunging.

Some populations, including big ones like Germany and China, are already declining. But Italy is leading the way in Europe. From Reuters:

Births in Italy hit record low in 2022, population shrinks further

Births in Italy dropped to a new historic low below 400,000 in 2022, national statistics bureau ISTAT said on Friday, as the population continued to shrink.

Italy’s dearth of babies is considered a national emergency, and fixing the problem was a prominent policy pledge by Giorgia Meloni ahead of last year’s election which saw her become the country’s first woman prime minister.

Last year Italy recorded more than 12 deaths for every seven births and the resident population fell by 179,000 to 58.85 million, ISTAT said in its annual demographic report.

Italy recorded 392,600 births in 2022, down from 400,249 the previous year, ISTAT said, the 14th consecutive fall and the lowest number since the country’s unification in 1861.

The fertility rate edged down to 1.24 children per woman from 1.25 in 2021. Italy’s overall population has been falling steadily since 2014, with a cumulative loss since then of more than 1.36 million people, equivalent to the residents of Milan, the country’s second biggest city.

ISTAT predicted in September that Italy could lose almost a fifth of its residents, with the population set to decline, under a baseline scenario, to 54.2 million in 2050 and 47.7 million in 2070.

Japan, meanwhile, offers a glimpse of Asia’s future:

Japan’s Population Projected to Fall to 87 Million in 2070

(Nippon) – Japan’s population, which stood at 126.2 million in 2020, will drop below 100 million by 2056 and to 87 million or around two-thirds of the current figure by 2070, according to reported projections by the National Institute of Population and Social Security Research.

Japan’s population grew continuously after World War II, surpassing 100 million for the first time in 1967, during a period of rapid economic growth. After peaking at 128.1 million in 2008, however, the figure has been falling ever since. The 87-million projected population for 2070 is almost the same level as it was in 1953 when the country was still recovering from the aftermath of the war.

A breakdown of the population composition in 2070 shows 33.7 million people or 38.7% are predicted to be seniors aged 65 or over. In contrast, the working-age population (aged 15 to 64) will be 45.4 million, meaning that the number of workers supporting each senior will decrease from 2.1 to 1.3. The working generation, who normally drive both production and consumption, may become overwhelmed by the extra burden of social security. The population of children, aged 0 to 14, is predicted to fall to 8.0 million by 2070, representing less than 10% of the total population, leading to concern that Japanese society will not be sustainable.

Can a single worker support both themself and a retiree? That doesn’t seem mathematically possible, hence the financial doomsday predictions.

Immigration to the rescue?

Fertility stats for individual countries don’t include the several billion poor, desperate people who would happily move to Europe, the US, or Japan. From the previously quoted Reuters article on Italy:

[Italy’s falling births were] offset by immigration, with immigrants exceeding emigrants by 229,000 last year compared with a net inflow of 160,000 in 2021. Foreigners made up 8.6% of the country’s population in 2022, for a total of 5.05 million.

So shrinking countries can, if necessary, just import new workers to maintain their population. But this risks the replacement of their culture with an alien one, thus defeating the purpose of the program. Better, perhaps, to stay Japanese or Italian to the bitter end than commit cultural suicide half a century early. For developed countries, this might be the central political debate of the next few decades.

Automation: savior or existential threat?

Goldman Sachs predicts that AI will automate 46% of administrative jobs, 44% of legal jobs, and 37% of architecture and engineering. In developed countries, this would mean 28% of workers being replaced by machines. In a sign of things to come, IBM recently announced plans to replace almost 8,000 jobs with AI, with human resources professionals being the first to go.

But Goldman notes that emerging technologies also create new jobs, so the net impact isn’t clear.

(Yahoo) – While speaking at the U.K.’s inaugural A.I. Safety Summit last week, serial founder, investor, and CEO Elon Musk predicted that AI would inevitably remove the need for all jobs.

“It’s hard to say exactly what that moment is, but there will come a point where no job is needed,” Musk told U.K. Prime Minister Rishi Sunak. “You can have a job if you want to have a job, or sort of personal satisfaction, but the AI will be able to do everything.”

That may sound alarming to many, and even Musk joked that he wasn’t sure “if that makes people comfortable or uncomfortable.” But Musk’s perspective was apparently more positive, describing his vision as a “protopian” future with AI.

“I think everyone will have access to this magic genie, and you’re able to ask any question. It’ll be certainly bigger for education. It’ll be the best tutor,” he said. “And there will be no shortage of goods and services. It will be an age of abundance.”

He also suggested AI will lead to a “universal high income,” an apparent superior to universal basic income, which other Silicon Valley figures like Sam Altman and Mark Zuckerberg have advocated for. “We won’t have universal basic income. We’ll have universal high income,” Musk said, without clarifying how the two differ. “In some sense, it’ll be somewhat of a leveler, an equalizer.”

Totally manageable transition

The deeper one digs into the population issue, the less scary it becomes. For every demographic threat, there’s a solution. But since the (always preferable) laissez-faire approach won’t work in cultures where free individuals are choosing not to reproduce, this might be an issue where even libertarians will have to hold their noses and accept major government interventions. Some examples:

Low birth rate countries can create immigration programs that actively recruit adults with useful skills, and/or young people from compatible cultures (emphasis on “compatible”). Then eschew multiculturalism and encourage/demand assimilation. The work gets done and the culture survives.

Low birth rate countries can also just pay people to breed. As with most other things, there’s a number that gets results, and a coordinated policy of tax breaks, direct cash payments, and subsidies for daycare, education, housing, etc., might make parenting an attractive job. Ideally, the extra kids thus produced would more than cover their cost by working and paying taxes.

If automation is eliminating too many jobs, tax the robots’ owners and use the proceeds to finance new private sector opportunities, institute mandatory national service, and/or beef up the social safety net. This is a version of Elon Musk’s “post-scarcity” techno-utopia, and the sudden emergence of AI brings it into sight.

Assuming we get through this decade’s immediate threats, it might be a relief to confront some problems that have actual solutions.

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Watch Live: ‘Hawkish’ Powell Hints At Firmer Policy Position, Warns Of Inflation “Head-Fakes”

Energy News Beat

Joining Powell in the discussion are the IMF’s Gita Gopinath, Bank of Israel Governor Amir Yaron, and Kenneth Rogoff, chair of international economics at Harvard University.

Thank you for the opportunity to participate in today’s panel discussion. My assigned topic is U.S. monetary policy in the current global inflation episode. I will briefly address the U.S. outlook and then turn to three broader questions raised by the historic events of the pandemic era.

U.S. inflation has come down over the past year but remains well above our 2 percent target (figure 1). My colleagues and I are gratified by this progress but expect that the process of getting inflation sustainably down to 2 percent has a long way to go. The labor market remains tight, although improvements in labor supply and a gradual easing in demand continue to move it into better balance. Gross domestic product growth in the third quarter was quite strong, but, like most forecasters, we expect growth to moderate in coming quarters. Of course, that remains to be seen, and we are attentive to the risk that stronger growth could undermine further progress in restoring balance to the labor market and in bringing inflation down, which could warrant a response from monetary policy. The Federal Open Market Committee (FOMC) is committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation down to 2 percent over time; we are not confident that we have achieved such a stance.

We know that ongoing progress toward our 2 percent goal is not assured: Inflation has given us a few head fakes. If it becomes appropriate to tighten policy further, we will not hesitate to do so.

We will continue to move carefully, however, allowing us to address both the risk of being misled by a few good months of data, and the risk of overtightening. We are making decisions meeting by meeting, based on the totality of the incoming data and their implications for the outlook for economic activity and inflation, as well as the balance of risks, determining the extent of additional policy firming that may be appropriate to return inflation to 2 percent over time. We will keep at it until the job is done.

With that, I will turn to three questions that have arisen from the receding but still elevated inflation we are experiencing today.

The first question is, with the benefit of 2‑1/2 years to look back, what we can say about the initial causes and ongoing policy implications of the current inflation.

After running below our 2 percent target over the first year of the pandemic, core PCE (personal consumption expenditures) inflation rose sharply in March 2021. Economic forecasters generally did not see this coming, as shown by the February 2021 Survey of Professional Forecasters, which showed core PCE inflation running at or below target over the subsequent three years.3 The real-time questions for policymakers were what caused the high inflation and how policy should react. At the outset, many forecasters and analysts, including FOMC participants, viewed the sudden upturn in inflation as mostly a function of pandemic-related shifts in the composition of demand, a disruption of supply chains, and a sharp decline in labor supply. The resulting supply and demand imbalances led to large increases in the prices of a range of items most directly affected by the pandemic, especially goods. In this view, as the pandemic abated, our dynamic and flexible economy was likely to adapt fairly quickly. Supply disruptions and shortages would diminish. Labor supply would rebound, aided by the arrival of vaccines and the reopening of schools. Elevated demand for goods would shift back to services. Inflation would ease reasonably quickly without the need for a significant policy response.

Indeed, although monthly core PCE inflation spiked in March and April of 2021, beginning in May it declined for five consecutive months, providing some support for this view (figure 2). But in the fourth quarter of 2021, the data clearly changed amid waves of new COVID-19 variants, with only gradual progress in restoring global supply chains, and relatively few workers rejoining the labor force. That lack of progress, combined with very strong demand from households, contributed to a tight economy and a historically tight labor market, and more persistent high inflation.

The Committee signaled a change in our policy approach, and financial conditions began to tighten. A new shock arrived in February 2022, when Russia invaded Ukraine, resulting in a sharp increase in energy and other commodity prices. When we lifted off in March, it was clear that bringing down inflation would depend both on the unwinding of the unprecedented pandemic-related demand and supply distortions and on our tightening of monetary policy, which would slow the growth of aggregate demand, allowing supply time to catch up. Today, these two processes are working together to bring inflation down. The FOMC has raised the federal funds rate target range by 5-1/4 percentage points and reduced our securities holdings by more than $1 trillion. Monetary policy is in restrictive territory and putting downward pressure on demand and inflation.

The unwinding of pandemic-related supply and demand distortions is playing an important role in the decline of inflation. For example, wage growth has steadily fallen by most measures since mid-2022 (figure 3), despite continued robust job gains, reflecting a resurgence in labor supply thanks to higher labor force participation and a return of immigration to pre-pandemic levels.

While the broader supply recovery continues, it is not clear how much more will be achieved by additional supply-side improvements. Going forward, it may be that a greater share of the progress in reducing inflation will have to come from tight monetary policy restraining the growth of aggregate demand.

Turning to my second question, for many years, it has been generally thought that monetary policy should limit its response to, or “look through,” supply shocks to the extent that they are temporary and idiosyncratic. Many argue as well that, in the future, supply disruptions are likely to be more frequent or more persistent than in the decades just before the pandemic.7 A second question, then, is what we have learned about the standard “looking through” approach.

The idea that the response to the inflationary effects of supply shocks should be attenuated arises, in part, from the tradeoff presented by those shocks. Supply shocks tend to move prices and employment in opposite directions, whereas monetary policy pushes each in the same direction. Therefore, the response of monetary policy to higher prices stemming from an adverse supply shock should be attenuated because it would otherwise amplify the unwanted decline in employment.8 In addition, supply shocks have most frequently come from the volatile food and energy categories and have passed quickly. While food and energy prices critically affect the budgets of households and businesses, the policy tools of central banks work more slowly than commodity markets move. Responding aggressively to quickly passing price increases could exacerbate macroeconomic volatility without supporting price stability.

Our experience since 2020 highlights some limits of that thinking. To begin with, it can be challenging to disentangle supply shocks from demand shocks in real time, and also to determine how long either will persist, particularly in the extraordinary circumstances of the past three years. Supply shocks that have a persistent effect on potential output could call for restrictive policy to better align aggregate demand with the suppressed level of aggregate supply. The sequence of shocks to global supply chains experienced from 2020 to 2022 suppressed output for a considerable time and may have persistently altered global supply dynamics. Such a sequence calls on policymakers to use policy restraint to limit inflationary effects.

Policy restraint in this case is also good risk management. Supply shocks that drive inflation high enough for long enough can affect the longer-term inflation expectations of households and businesses. Monetary policy must forthrightly address any risks of a potential de-anchoring of inflation expectations, as well-anchored expectations help facilitate bringing inflation back to our target. The sharp policy tightening during 2022 likely contributed to keeping inflation expectations well anchored.

My third question is the level where interest rates will settle once the effects of the pandemic are truly behind us. By 2019, the general level of nominal interest rates had declined steadily over several decades (figure 4). As the pandemic arrived, many advanced economies had below-target inflation and low or mildly negative policy rates, raising difficult questions about the efficacy of interest rate policy when constrained by the effective lower bound (ELB). Over two decades, an extensive literature had identified a number of possible changes to the widely used inflation-targeting regime, including negative policy rates, nominal income targeting, and various forms of makeup strategies under which persistent shortfalls in inflation would be followed by a period of inflation running moderately above 2 percent.9 Today, inflation and policy rates are elevated, and the ELB is not currently relevant for our policy decisions. But it is too soon to say whether the monetary policy challenges of the ELB will ultimately turn out to be a thing of the past.

The prolonged proximity of interest rates to the ELB was at the heart of the monetary policy review and the changes we made to our framework in 2020. We will begin our next five-year review in the latter half of 2024 and announce the results about a year later. Among the questions we will consider is the degree to which the structural features of the economy that led to low interest rates in the pre-pandemic era will persist. With time, we will continue to learn from the experience of the past few years, and what implications it may hold for monetary policy.

These are just three of the many questions raised by these challenging times, and we are far from a complete understanding of the answers. I appreciate the opportunity to discuss these issues with you today and look forward to our conversation.

We would imagine it will be hard for him to navigate that Q&A without some market-moving comment on where we are in the monetary-policy cycle (especially given the dramatic loosening of financial conditions in the last week)…

During his press conference last week, Powell did everything possible to maintain policy optionality, but most Fed watchers and market participants believe the Fed’s tightening cycle is complete (90.5% odds that Fed stays on hold in Dec).

EY Chief Economist Gregory Daco.

While next week brings the economic data deluge back (most notably CPI), there’s still a chance that Powell can gently jawbone back the dramatic ‘easing’ that the market has created in the days since the last press conference… and will anyone ask him about the collapse of liquidity in the US Treasury market…

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