August 7th, 2014
11:42 AM ET

How Saudi Arabia can avoid an energy crisis

By Maha Hosain Aziz, Special to CNN

Editor’s note: Maha Hosain Aziz is a professor of politics (adjunct) in NYU's Graduate School of Arts and Sciences and a senior analyst at geopolitical consultancy Wikistrat. The views expressed are her own.

Ask most Americans which country is the world’s largest oil producer is, and you will likely hear some familiar names – Saudi Arabia, Iran and Iraq. Some might suggest Russia, which produces more than 10 million barrels a day. Yet according to recent numbers from the International Energy Agency and Bank of America, it’s another country has taken the lead in global production – the United States. And this new reality raises an interesting question: Is this the beginning of the end of former number one Saudi Arabia’s global oil dominance?

In recent years, everyone from Citigroup to Chatham House has suggested Saudi Arabia – the world’s biggest oil exporter – could face oil shortages in the next 10 to 15 years, prompting many to ask whether the country and its heavily oil-dependent economy are prepared for the potential crisis.

The answer is yes, and no. Local energy demand has skyrocketed, and could increase by 250 percent by 2028, largely due to a population boom that has seen the Kingdom’s population jump from six million in 1970 to over 29 million today. This in turn has prompted the state to explore oil alternatives for domestic energy use. Indeed, in June, Saudi Arabia and the United Arab Emirates reportedly signed an accord to jointly develop renewable energy and clean technology. In addition, Saudi Arabia has indicated it hopes to become a key market for renewable energy by 2032, with a projected third of the country’s power to come from this source. FULL POST

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Topics: Economy • Energy • Oil • Saudi Arabia
July 22nd, 2014
11:28 AM ET

A rival to the World Bank?

For more What in the World watch Sundays at 10 a.m. & 1 p.m. ET on CNN

By Global Public Square staff

World leaders came together in Brazil last week to celebrate. And no, this had nothing to do with the World Cup. We’re talking about the 6th annual BRICS summit.

The leaders of all the BRICS nations – that is Vladimir Putin, Narendra Modi, Dilma Rousseff, Xi Jinping and Jacob Zuma – all gathered in Fortaleza, Brazil. And on Tuesday they sent a shot across the bow by announcing a $50 billion bank meant to rival the World Bank, and a $100 billion crisis fund to replace the IMF.

It’s clear why they made this move.

You see, these five nations – Brazil, Russia, India, China and South Africa – now account for more than 40 percent of the world's population, almost 20 percent of the world's total GDP and 17 percent of global trade. Yes, growth in the emerging markets has slowed recently, but these countries have still become a large enough force in the global system that they want a seat at the table.


July 19th, 2014
11:07 PM ET

Krugman: It's starting to look like a recovery

Fareed speaks with New York Times columnist Paul Krugman about the state of the U.S. economy. Watch the full interview on GPS this Sunday at 10 a.m. & 1 p.m. ET on CNN.

So, Paul, the quick take on the U.S. economy.

Things are getting better, finally. It's starting to look, finally, like a real recovery. But it's not a boom. And this is after many, many years of terrible performance. So, relative to the way things have been for the last few years, we're feeling pretty good. Relative to anything anyone could have imagined, the worst down side you could have imagined seven years ago, it's terrible.

So I would say it's half full, half empty. More half empty than half full, because we should be doing much better than this.

And lots of people argue the only reason we're doing as well as we are is that the Federal Reserve has maintained these extraordinarily, very low rates, other kinds of programs that pump cash into the system.

Well, certainly keeping rates low – there's no rational reason not to keep them low. Basically, business doesn't see a lot of investment opportunities, people aren’t ready to buy houses in large numbers yet. So you have to have a cheap money environment.And at least, thankfully, the Fed has been doing its job.

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Topics: Economy • GPS Show
July 15th, 2014
11:33 AM ET

The danger of America's 'economic drone'

For more What in the World watch Sundays at 10 a.m. & 1 p.m. ET on CNN

By Global Public Square staff

We’re sure you heard about the Paris-based bank, BNP Paribas, which fell afoul of Washington's regulators and agreed to plead guilty to a felony and pay a staggering $8.9 billion fine – larger than its annual profits.

So it must have violated a slew of laws, right? Actually, no. It hadn't violated French law, or EU law, or any of its obligations under the WTO or the United Nations. It hadn't even violated a French-American treaty.

What in the world?

BNP Paribas violated a set of unilateral American sanctions, passed by Congress, that were never affirmed or followed by the European Union or France.And neither the buyers nor the sellers in any of the transactions BNP was involved in were Americans.

So what was Washington's hold on BNP? It all centers on the central role that the dollar plays in today's globalized economy. You see, even if two foreign companies want to do a deal, assuming it’s a large transaction, the deal is likely to be denominated in dollars – the currency that everyone has access to, is available in ample supply, is a symbol of stability and, as a result, remains the world's reserve currency.


July 7th, 2014
04:51 PM ET

Why the Export-Import Bank matters

For more What in the World watch Sundays at 10 a.m. & 1 p.m. ET on CNN

By Global Public Square staff

You know countries don't always play by the rules of international trade, especially countries where the government and large companies are really all part of the same team.

Take, for example, China – the most notorious player who hasn't read the rule sheet. The government of China lavishes subsidies on its companies to make their products more competitive in the global marketplace.

And it's not just subsidies that help Chinese companies. Last year, China's government gave its domestic companies $111 billion in guarantees, loans and insurance to help them sell their various products overseas.

And China is just one example – Japan's companies got $33 billion worth of such treatment, South Korea $24 billion. And by contrast, the U.S. total was just $15 billion. Keep in mind that South Korea's economy is less than 1/10th the size of America's!


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Topics: China • Economy • United States • What in the World?
June 28th, 2014
10:58 PM ET

Where America Works: A closer look at Houston

Watch"Fareed Zakaria GPS," Sundays at 10 a.m. and 1 p.m. ET on CNN

Houston was the first city to regain all of the jobs it lost in the 2008 recession. In fact, it actually created more than two jobs for every one that it lost.

That job creation has been a driving force behind the changing face of Houston, which in the words of current Mayor Annise Parker has been trying to fill those jobs by attracting “some of the best and the brightest from around the world.”

Today, one in five Houstonians was born in another country. To find out more about how Gulfton has been at the center of the changes in the city, watch the video clip and tune into a new segment starting this Sunday on GPS: Where America Works.

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Topics: Economy • United States
June 24th, 2014
10:28 AM ET

A smarter way to tackle poverty

For more What in the World watch Sundays at 10 a.m. & 1 p.m. ET on CNN

By Global Public Square staff

The economic buzzword of the year is inequality – it has sparked protests around the world, it’s a centerpiece of President Obama's agenda now, and it has even inspired an unlikely bestseller.

People watch the growing inequality around the world and in the United States and despair about what to do. One of the most popular fixes is raising the minimum wage – and that’s not just on the left. Germany's Chancellor Angela Merkel has recently supported a new wage increase, as has Britain's Chancellor of the Exchequer the Conservative Party’s George Osborne.

In the United States, President Obama proposed boosting the federal minimum wage to $10.10 an hour at the beginning of the year. That's a 39 percent increase over the current wage minimum of $7.25. Republicans have, of course, made it clear that they will never pass this in Congress.

Last week, the International Monetary Fund weighed in and urged the U.S. to raise the wage floor, saying it is low by both historical and international standards. The federal minimum wage in America was about 38 percent of the median wage in 2011, which is one of lowest percentages among the rich countries of the world.


How the World Cup has already changed Brazil
June 12th, 2014
12:37 PM ET

How the World Cup has already changed Brazil

By Peter Schechter, Special to CNN

Editor’s note: Peter Schechter is director of the Adrienne Arsht Latin America Center at the Atlantic Council, which has released the new policy brief Will Brazil get what it expects from the World Cup? The views expressed are his own.

As Brazilians prepare for the opening game of this year’s World Cup, the public can be expected to engage with their wonderful soccer team and perhaps look forward to some celebrating – after all, Brazil is a firm favorite with the bookmakers. But the doubts about the tournament – visible in protests, newspaper editorials, NGO activism on stadium cost overruns, strikes, and increasingly strident criticism of President Dilma Rousseff – speak to important questions about Brazil's future.

In fact, whatever happens over the next month, one thing is clear: Brazil is at a moment of profound transition. The "model" is in doubt.

Over the past decade, Brazil flourished partly due to the fast flow of high-priced commodities sold to China and the rest of the world. The government of President Luiz Inácio Lula da Silva brought innovative social experiments that raised millions from poverty. But Brazil neglected to prepare for the down cycle by reforming its economy and improving services. Now, reduced demand for exports and lower commodity prices are exposing the burdens of a vast state of 200 million citizens.


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Topics: Brazil • Economy
June 10th, 2014
08:59 AM ET

Why we should care about teeth whitening

For more What in the World watch Sundays at 10 a.m. & 1 p.m. ET on CNN

By Global Public Square staff

All eyes will be on the U.S. Supreme Court this month as it issues its final decisions before recessing for the summer. When it comes back in session (on the first Monday of October), it will likely hear a critical case. But the case is not about money in politics or affirmative action or the powers of the presidency – it's about whether you can get your teeth whitened at a kiosk in the mall.

What in the world?

You see, teeth whitening services have been in high demand since 1989. And, as with any billion-dollar business, people are keen to capitalize on the trend. In 2003, non-dentists in North Carolina started to provide peroxide whitening at significantly lower prices than dentists.

Not surprisingly, the dentists started complaining.


June 9th, 2014
12:28 PM ET

How the market can undermine terrorism

By Jay Cohen and Barry Blechman, Special to CNN

Editor’s note: Jay Cohen (RADM, USN, Ret.) is a principal at Chertoff Group. Barry Blechman is a distinguished fellow at the Stimson Center. They are chair and vice chair, respectively, of Stimson’s Partners in Prevention Task Force, which released its final recommendations on May 29. The views expressed are their own.

On October 29, 2010, airplanes carrying two unremarkable packages left Yemen. Were it not for an eleventh-hour intelligence tip, the bomb inside each parcel, disguised by al Qaeda in the Islamic Maghreb as a printer cartridge, likely would have continued to evade standard security checks and detonated over the eastern United States.

Despite its frantic search for a quick fix to prevent similar incidents in the future, the U.S. government surprised many by foregoing immediate regulatory action. Instead, it collaborated with the major express air delivery companies to enhance sharing of security information without hampering legitimate trade.

The result of those discussions – the Air Cargo Advance Screening regime – highlights one of the many ways government and industry can work together to create a successful solution to the challenge of maintaining security in a global economy. At once, globalization has opened opportunities for billions of people, but it has also empowered criminals and terrorists on a worldwide scale. Unfortunately, nearly four years after the cargo plane plot, many critical security gaps that take root in modern global trade remain.


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Topics: Economy • Terrorism
June 4th, 2014
04:58 PM ET

Should U.S. measure the black market?

For more Last Look, watch GPS, Sundays at 10 a.m. and 1 p.m. ET on CNN

The government announced last week that the U.S. economy shrank in the first quarter. That's the first quarter in the red in three years. It's certainly not catastrophic, but it got me wondering whether the mafia might be able to help on this one. No, I'm not suggesting that organized crime make offers that American CEO can't refuse. Instead, I'm suggesting that the U.S. might want to take a page from Italy's book. Let me explain.

Italy's GDP has essentially the opposite track record of the U.S. until recently. The fourth quarter of 2013 was the first time Italy's economy grew in two years. So Italy dipped into the shadows this past week, the shadow economy, that is.

Starting in 2014 and going retroactively, Italy has said it will add the mafia's dealings to its GDP. And not just like Cosa Nostra, but anyone who makes money in the black market, drug dealing, prostitution, smuggling. Analysts expect this accounting change to boost Italy's GDP a good percentage point or two.


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Topics: Economy • Last Look
May 16th, 2014
12:45 PM ET

Geithner: Financial crisis strategy was 'dramatically different'

Fareed speaks with former U.S. Treasury Secretary Tim Geithner about criticism of the Obama administration's response to the financial crisis. Watch the full interview on "Fareed Zakaria GPS," this Sunday at 10 a.m. and 1 p.m. ET on CNN

So critics would say that this is the weakest recovery since the Great Depression, so in 60 or 70 years. That much of that weakness has to do, The Wall Street Journal editorializes often, because of all the burdens that the Obama administration has put on it – regulatory burdens from Obamacare, from Dodd-Frank, the re-regulation of the financial industry. What do you say to them?

I've been exposed to that view and it’s true that we definitely brought some substantial changes to the economics of the financial system. And those were disruptive and they definitely changed the economics of it.

But that was a necessary, just thing to do. And this recovery, if you look at our experience against the record of the last hundred years of recoveries following bad finance crises is it's a moderate recovery. But it looks pretty good in relative terms.

And if you look at the American economy today, you're going to see a gradually strengthening economy, and we should see not just unemployment fall further, but we should see income growth improve for a broader fraction of Americans.  And that's again, I believe, because we adopted a dramatically different strategy into our crisis than had been the pattern of governments really across decades and decades.

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Topics: Economy • GPS Show
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