Signal: Tea Leaves, Bad Dogs, and the Secret of Happiness

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ALL HAIL XI JINKING

I’m back from the indescribably majestic Machu Picchu to review the implications of China’s momentous 19th Party Congress. This is basically an exercise in “Kremlinology,” the art of combing through the details of ruling party ritual to figure out which way the political winds are blowing. What did we learn from this event? 

The era of consensus rule in China is over. The strongman is here. Xi Jinping has now consolidated power in China on a scale we haven’t seen since the death of Deng Xiaoping in 1997. Xi did not designate a successor during the congress; he did not hint at when he might or whether he will. He stacked the seven-member Politburo Standing Committee with reliable political allies. He made plain that the army answers to the party. That’s all clear enough.

From there, things get murkier. We also learned that the Chinese constitution will now include “Xi’s Thought on Socialism with Chinese Characteristics for a New Era,” an honor reserved in the past only for Deng and Mao Tse-tung. The main implication of this seems to be that any criticism of Xi is now criticism of the party itself. We’re told to expect “complete and deep reform,” “new developing ideas,” and "harmonious living between man and nature.”

The bottom-line: China’s international influence continues to grow. In coming years, it’s economy will become the world’s largest. (By some measures, it already is.) None of us has ever lived in a world where the largest economy belongs to a country governed by seven men and dominated by one, one where events we can’t easily interpret move markets in big ways and on a regular basis. If you thought former US central banker Alan Greenspan made cryptic comments, wait until we have to interpret official Chinese reaction to future market shocks inside that still highly secretive country. 

FINDING NEMO’S MESSAGE

Kremlinology takes many forms. Last week, French President Emmanuel Macron was meeting with junior members of his government when first dog Nemo decided to relieve himself in an Elysée Palace fireplace. On camera. In the spirit of interpreting hidden political messages, what might Nemo be trying to tell us?

Is Nemo not a fan of Macron’s Eurozone reform plans? Is he signaling to dogs of other political parties that the Elysée is his territory and that the campaign for re-election starts now? Is this a rescue dog’s instinctive aversion to excessive opulence? Is he trying to tell the Président de la République to stop acting so serious all the time? Or maybe he was just fed up with the Minister of Dog Walking who seems forever stuck in traffic on the Boulevard St. Michel. We’ll keep on this one. 

ELSEWHERE...

Standoffs continued over Kurdish and Catalan independence measures, Thailand held a grand five-day funeral for its widely revered King Bhumibol Adulyadej, Kenya’s voters returned to the polls for another try at a free and fair election, New Zealand’s first cat, known as Paddles, behaved with much greater dignity than did French first dog Nemo, and the legendary Antoine “Fats” Domino Jr. now sits atop that great Blueberry Hill in the sky. 

WANT TO KNOW A SECRET?

What does Signal want for you, our loyal readers? We want you to be informed, provoked, and entertained. More than that, we want you to be happy. In our opinion, "A calm and humble life will bring more happiness than the pursuit of success and the constant restlessness that comes with it.” We know that Albert Einstein agrees with us on this, because he wrote these very words in a letter from Tokyo’s Imperial Hotel in 1922. Someone purchased that letter at auction this week for $1.56 million, but we offer you this wisdom for free. 

WHAT WE'RE WATCHING

Mohammed bin Salman – The soon-to-be king pledged this week to return Saudi Arabia to “a moderate Islam open to the world and all religions.” He blamed the Iranian revolution of 1979 for pushing Saudis in a hardline direction. “Honestly, we won’t waste 30 years of our life combating extremist thoughts. We will destroy them now and immediately.” There are many ways to define ambition. 

Data collection in China – Human Rights Watch reported this week that the Chinese government is now working with a Chinese company that produces speech recognition technology to create a system that can identify individual voices in phone conversations. In other news, a Chinese university is using facial recognition technology to take attendance in class. There are many ways to consolidate power. 

Argentina – Mauricio Macri, fresh off last weekend’s strong midterm elections performance, can now take more steps to rationalize the government’s budget, a big step for a country still slow to fully escape the international financial isolation of recent years. As important, former president Cristina Kirchner finished second behind a little-known opponent in the all-important province of Buenos Aires, though she will still claim a Senate seat on behalf of her party. Macri is now in strong position for re-election as president in 2019. The country’s economic recovery looks set to continue. 

WHAT WE'RE IGNORING

The Republican Party’s majority in the US Senate – There are 52 Republicans now serving in the US Senate. There are 48 senators who are either Democrats or independents who caucus with Democrats. But President Trump has no credible working majority to advance anything beyond a modest tax cut. Moderate Republican Senators Susan Collins (Maine) and Lisa Murkowski (Alaska) won’t support some of the more controversial items that conservatives want. Rand Paul (Kentucky) is a doctrinaire contrarian who won’t support anything he considers a half measure. Senators John McCain (Arizona), Jeff Flake (Arizona), and Bob Corker (Tennessee) have made clear their low regard for Trump. No wonder so little of Trump’s agenda has moved forward.

Somalia’s red bandana protests – It’s easy to understand why Somalia’s long-suffering citizens are fed up with terrorist group al-Shabab. Hundreds were killed or wounded in last weekend’s devastating truck bombing. People in Mogadishu have taken to wearing bits of red cloth around their foreheads to protest al-Shabab’s atrocities. But demonstrations this week included confrontations between protesters and police. If only unity in anger were enough to put an end to cold-blooded murder. 

YOUR WEEKLY BREMMER

THE WORLD IN 60 SECONDS

Watch this week's World in 60 Seconds, live from Tokyo! 

HARD NUMBERS 

66: Some 66% of Americans now view Mexico favorably, up from 54% in 2010. In 2010, 56% of Mexicans viewed the US favorably. Today, that figure is at 30%. #TrumpEffect 

1/3: Just six years after South Sudan was established, more than one-third of South Sudan’s population has been displaced by fighting. 

3417: The number of Russian foreign fighters that have gone to Iraq and Syria. As ISIS loses its grip on those countries, these foreign fighters will return home. #PutinsProblemNow 

25: Happy 25th birthday to REM’s “Automatic for the People,” a landmark American album from the boys from Athens, GA. Don’t stop listening until you “Find the River.” 

WORDS OF WISDOM

“I did say that I thought [Brexit] was the single stupidest thing any country has ever done, but then we trumped it.” 

– Former mayor of New York City Mike Bloomberg, whose two-week old quip was unearthed while he was in London this week to open a new European Bloomberg HQ 

This edition of Signal was written by Willis Sparks, and prepared with editorial support from Kevin Allison (@KevinAllison), Leon Levy (@leonmlevy), Gabe Lipton (@Gflipton), spiritual counsel from Alex Kliment (@saosasha), and video editing by Alex Gibson (@alexedgibson).

If you like what you see, be sure to sign up to receive it in your inbox first thing every Friday morning: eurasiagroup.net/signal.