What I'm reading

By Fareed Zakaria

“That tacit decision to accept all Russian money at face value has come home to roost in the past week,” writes Anne Applebaum in Slate. “Some of the general European reluctance to apply economic sanctions to Russia is of course directly related to the Russian investments, interests, and clients of European companies and banks. But in fact, the laundering of Russian money into acceptability, in both Europe and the United States, has had far more important consequences in Russia itself.”

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“Many Venezuelans are still unable to connect the dots between Chavez's policies and the economic difficulties they face every day,” writes Raul Gallegos for Bloomberg. “Enough people continue to believe that their former leader’s benevolent redistribution plans were somehow only botched by state inefficiency.”

“Chavez’s version of social inclusion set a low bar. It never gave the poor the tools to achieve sustainable development through viable long-term employment in a thriving private sector. But nurturing people’s ambition has never been the Chavista way.”

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“The developing world promised spectacular riches. But on average the return on capital multinational firms are making in emerging markets has been mediocre – no higher than the global average. Many firms are not getting adequate reward for the risks they are taking. Some have lost a ton of money,” the Economist says.

“So what went wrong? In their enthusiasm to get into emerging markets, plenty of companies did not take the risks involved seriously enough. Russia’s move into Crimea may have been a shock, but – after a similar move into Georgia in 2008—it was hardly a surprise. Governments tend to play rougher in emerging markets. A Spanish oil firm, Repsol, had its assets in Argentina expropriated (on February 26 it agreed to a compensation package). India’s tax officials have tried to kneecap Vodafone, Nokia and IBM, among others.”

“Mostly, though, bad management was to blame.”
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