TIME Iran

These 5 Facts Explain the State of Iran

Secretary of State John Kerry, Iranian Foreign Minister Javad Zarif and others wait for a meeting at the Beau Rivage Palace Hotel on March 27, 2015 in Lausanne, Switzerland.
Brendan Smialowski—Reuters Secretary of State John Kerry, Iranian Foreign Minister Javad Zarif and others wait for a meeting at the Beau Rivage Palace Hotel on March 27, 2015 in Lausanne, Switzerland.

Sanctions, demographics, oil and cyberwarfare

As leaders in the United States and Iran maintain laser focus on the ongoing nuclear negotiations, it’s valuable to take a broader look at Iran’s politics, its economy, and its relations with the United States. Here are five stats that explain everything from Iran’s goals in cyberspace to its views of Western powers.

1. Sanctions and their discontents

Sanctions have taken a heavy toll on the Iranian economy. According to the Congressional Research Service, Iran’s economy is 15 to 20% smaller than it would have been without the sanctions that have been enacted since 2010. They leave Iran unable to access nearly four-fifths of the $100 billion in reserves the country holds in international accounts. Iran’s oil output has fallen off a cliff. Four years ago, Iran sold some 2.5 million barrels of oil and condensates a day. Over the last year, the country has averaged just over a million barrels a day. Even as the exports have fallen and the price has plummeted, oil still accounts for 42% of government revenues. Iran’s latest budget will slash spending by 11% after accounting for inflation.

(Bloomberg, The Economist)

2. Cyber-spending spree

But despite the belt-tightening, Tehran has been willing to splurge in one area. Funding for cyber security in the 2015/16 budget is 1200% higher than the $3.4 million allotted in 2013/14. Up until 2010, Iran’s chief focus in cyberspace was managing internal dissidents. But after news of the Stuxnet virus—a U.S.-led cyberattack on Iran’s nuclear program—went public in 2010, Iran’s leaders shifted gears. According to one estimate, Iran spent over $1 billion on its cyber capabilities in 2012 alone. That year, it conducted the Shamoon attack, wiping data from about 30,000 machines belonging to Saudi oil company Aramco. In 2013, the Iranian Revolutionary Guard publicly declared that Iran was “the fourth biggest cyber power among the world’s cyber armies.”

(Global Voices, Wired, Strategic Studies Institute, Wall Street Journal)

3. New generation and old leadership

The median age in Iran is 28, and youth unemployment in the country hovers around 25%. Nearly seven out of ten Iranians are under 35 years old, too young to remember the Iranian revolution of 1979. But the country is controlled by older men, many of whom had an instrumental role in the revolution. Supreme Leader Ayatollah Ali Khamenei is 75 years old; there have been concerns about his health and Iran’s eventual succession plan. Iran’s Assembly of Experts is an opaque institution with huge symbolic importance: it is tasked with selecting and overseeing Iran’s Supreme Leader. The Assembly’s Chairman passed away in October at the age of 83. His replacement? Ayatollah Mohammad Yazdi, who is…83 years old.

(New York Times, CIA World Factbook, BBC)

4. The feeling is mutual

Over 70% of Iranians view the United States unfavorably—and 58% have “very unfavorable” views. On the flip side, more than three-quarters of surveyed Americans have unfavorable views of Iran. But that’s a more modest stance than some other European powers: 80% of French and 85% of Germans have unfavorable views of Iran. According to recent polls, Iran is no longer considered “the United States’ greatest enemy today.” In 2012, 32% of those polled chose Iran, good for first place. In 2015, just 9% selected Iran, placing it fourth behind China, North Korea and Russia, respectively.

(Center for International & Security Studies, Pew Research Center, Vox)

5. Support for a deal?

Negative views of Iran haven’t undermined Americans’ desire to try and cut a deal: 68% of Americans favor diplomacy with Iran. It’s a bipartisan majority: 77% of Democrats and 65% of Republicans are in favor of talks. Iranians have mixed expectations: only 48% think that President Rouhani will be successful in reaching an agreement. But if we do see a final deal, a lot more than Iranian oil could open up. Western businesses would love to break into a country that is more populous than Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Oman, Israel, Bahrain, Lebanon and Jordan combined.

(Center for International & Security Studies, CNN survey, CIA World Factbook)

TIME Globalization

These Are the 7 Challenges of Globalization

What happens as the world becomes even more interconnected…and even more leaderless?

Some argue that globalization is grinding to a screeching halt. In a world of increased conflict and turmoil, where major powers jockey for influence, financial sanctions have become a go-to weapon and even the Internet threatens to splinter, then surely the cross-border flow of money, ideas, information, goods and services will begin to slow—or even reverse.

Others argue that globalization is really just Americanization by other means. After all, the United States still dominates the international financial system. Information hurtling through cyberspace promotes the democratization of information, because it creates demand for still more information and forces autocrats to care more about public opinion. As developing countries develop, aren’t they becoming more like America?

Not anymore. If globalization has promoted the American dream over the past quarter century, it’s only because the United States has been a dominant power. There is nothing inherently American or Western about globalization itself. And times are changing.

Globalization isn’t going away—in fact, it will continue apace. But the U.S.-led world order is deteriorating. An inconsistent, war-weary United States is no longer willing and able to provide global leadership—and no other country is stepping up to take its place: the rest of the West is distracted with problems at home, and allies are looking to hedge their bets.

Meanwhile, developing countries have become powerful enough to start dismantling the U.S.-led international system; China, Russia, Turkey, and a host of other emerging markets have more ability to ‘veto’ global initiatives that they disagree with. But they are not yet synchronized or influential enough—and their values and interests are too divergent—to offer adequate alternatives of their own. The result is a regionalized world where Americanization and globalization are no longer one and the same.

This unprecedented combination will generate a lot of new risks and opportunities. I recently helped the World Economic Forum’s Global Agenda Council on Geoeconomics with a report that outlines the seven major challenges to globalization in an interconnected, de-Americanized world.

My piece in the report focuses on one particular challenge: weaker underdogs. With a widening leadership vacuum at the very top, we are seeing regional heavyweights with more room to operate. Think: Russia’s intrusions in its backyard, Germany’s firm control over Eurozone policy, or China’s rapid rise in the Asia-Pacific. These major countries are consolidating power, often at the expense of the smaller countries around them. This ‘hollowing of the peripherals’ will accelerate in a world that is becoming rudderless at the global level.

This is just one of the seven trends we’ve highlighted. Read the full “Seven Challenges to Globalization” report here: http://www.weforum.org/reports/geo-economics-seven-challenges-globalization

 

TIME Venezuela

How Opening Cuba Helped Isolate Venezuela

Nicolas Maduro, Cilia Flores
Fernando Llano—AP Venezuela's President Nicolas Maduro, center, in Caracas, Venezuela, on Feb. 28, 2015.

President Obama’s decision to reopen relations with Cuba is having an interesting side effect: it’s helping isolate Latin America’s other hard-line leftist regime in Venezuela.

On Monday, Obama signed an Executive Order freezing the U.S. assets of seven midlevel Venezuelan officials over their handling of protests last year. In years past, many Latin American officials would have viewed it as more of the same from America, whose policy of punishing Cuba with sanctions was widely seen as anachronistic at best.

Now, thanks to the ongoing rapprochement between the U.S. and Cuba, Washington is less easy to ignore, especially on matters of morality and fair play. So it was that Monday’s executive order naming Venezuelan security officials turned out to be aiming what U.S. officials called “a spotlight” onto a government that other Latin American nations are also watching with concern.

“Until very recently, most countries in the region were reluctant to say anything about Venezuela,” says Daniel Wilkinson, managing director of the Americas division at Human Rights Watch. “If this is just U.S. sanctions, and the U.S. is doing it on its own, then it’s much easier for Venezuela to play the victim card. That’s why it’s really important for the U.S. government to be working with other democratic governments in the region to make this more of a collective.”

On Friday, the President of Colombia publicly despaired over Venezuela, even though he has staked his legacy on peace talks being hosted by Maduro’s strongest ally in the region, Havana. “It interests, hurts and worries us, all what’s going on in Venezuela,” President Manuel Santos said in a speech.

What’s going on in Venezuela is a mess. The collapse in oil prices last autumn sent the economy into free fall, 95% of its export revenue flowing from petroleum sales. President Nicolás Maduro, who was elected after his mentor Hugo Chávez died in office two years ago, is struggling to remain in control amid economic chaos and shortages of heavily subsidized staples. The cascade of indignities includes a shortage of necessaries that led the government to take over a toilet-paper factory — and the Prime Minister of Trinidad and Tobago to offer an oil-for-toilet-tissue deal.

Maduro, in what economists call a strategy of diversion, blames the U.S. for waging “economic war” on the country. He has ordered most U.S. diplomats out of the country — the ambassador was expelled five years ago — and abruptly required visiting Americans to obtain visas. None of which was lost on the White House, which took pains to emphasize that the new sanctions were aimed at individual officials, and not “the people or the economy of Venezuela.”

“The point of these sanctions or policies is really to shine a light,” a senior Obama Administration official said Monday, speaking in a not-for-attribution conference call shortly after the Executive Order was released. Obama’s actions went beyond the law passed by Congress, the Venezuela Defense of Human Rights and Civil Society Act of 2014, to draw attention to the abuses of Venezuelan officials who authorized surveillance of opposition leaders, “hundreds of forced entries and extrajudicial detentions,” and the use of excessive force, including sexual assault and using live ammunition, against protesters and journalists. Prosecutor Katherine Nayarith Haringhton Padron is named for charging a former lawmaker and the mayor of Caracas with conspiracy “based on implausible — and in some cases fabricated — information.”

“You go back a year ago, when there was this wave or protests that was met with very aggressive and violent response by the government,” says Wilkinson, who was expelled by Venezuelan authorities in 2008. “This was a sustained process over more than a month of nonviolent protesters being severely beaten, in some cases tortured, being shot point-blank range with rubber pellets … Protesters would be held for two days without access to a lawyer, then summoned to a hearing in the middle of the night, with a lawyer having five minutes to prepare.”

Whether the sanctions will work remains to be seen. Under the Executive Order, U.S. financial institutions have 10 days to report any holdings controlled by the seven officials, and longer still to see if freezing them alters the behavior in what Transparency International calls the most corrupt country in the western hemisphere. But in diplomatic terms, the effects might be felt sooner. Before Obama and Cuban President Raúl Castro announced their plans to reconcile, the Summit of the Americas, set to convene April 10 in Panama City, was sizing up as an awkward occasion for the U.S. leader. Instead, it may be Maduro who draws the sideways glances.

TIME russia

Russia Says It Would Consider Financial Help for Greece

Russian Federation Council member Anton Siluanov delivers a speech as Russian Federation Council deputy chairman Ilyas Ukhmanov, Russian Federation Council chairperson Valentina Matviyenko, Russian Federation Council deputy chairmen Evgeny Bushmin and Yuri Vorobyov (L to R, background) look on at a plenary meeting of the Russian Federation Council on Jan. 28, 2015.
Pitalev Ilya—ITAR-TASS Photo/Corbis Russian Federation Council member Anton Siluanov delivers a speech as Russian Federation Council deputy chairman Ilyas Ukhmanov, Russian Federation Council chairperson Valentina Matviyenko, Russian Federation Council deputy chairmen Evgeny Bushmin and Yuri Vorobyov (L to R, background) look on at a plenary meeting of the Russian Federation Council on Jan. 28, 2015.

Finance minister says Russia hasn't yet received a request for assistance

Russia’s finance minister said his country would consider providing financial support to Greece, raising the stakes for the European Union as it confronts the new Euroskeptic reality in Athens.

Anton Siluanov told CNBC that Russia has not received a request from Greece for assistance, but his comments come days after the anti-E.U. party Syriza won parliamentary elections, vowing to renegotiate aid packages from the bloc that are tied to strict austerity measures.

“We can imagine any situation, so if such petition is submitted to the Russian government, we will definitely consider it,” he said, “but will take into account all the factors of our bilateral relationships between Russia and Greece, so that is all I can say.”

The Greek government’s clash with the E.U. over its debt risks cutting the country off from euro zone lenders and private investors. That could create an opening for Russia to expand its influence in Greece—an ugly prospect for the E.U. as it engages in a sanctions battle with Russia over the conflict in Ukraine.

E.U. foreign ministers agreed on Thursday to impose a new round of sanctions, according to the Associated Press, apparently overcoming for now concerns from the new Greek government about expanding the rift between the EU and Russia.

[CNBC]

TIME U.S.

Watch How the AK-47 Came to Be ‘Made In America’

In early 2015, a U.S.-based company got the green light to start producing what is perhaps the world's most recognizable assault rifle

TIME White House

White House Chief of Staff Reaffirms ‘Deep and Abiding’ U.S.-Israel Ties

Meet the Press - Season 68
William B. Plowman—NBC/Getty Images Denis McDonough White House Chief of Staff appears on "Meet the Press" in Washington D.C. on Jan. 25, 2015.

Amid reports of a rift with Israeli Prime Minister Benjamin Netanyahu

White House Chief of Staff Denis McDonough repudiated reports of a widening rift between the Obama administration and Israeli Prime Minister Benjamin Netanyahu on Sunday’s morning talk shows.

An unnamed administration official was quoted by Israeli newspaper Haaretz as saying Netanyahu “spat in our face publicly” when he agreed to accept an invitation to speak to the United States Congress in March without President Obama having been consulted first.

But McDonough said on NBC’s Meet the Press that the alliance between the U.S. and Israel remained strong. “Our relationship with Israel is many-faceted, deep and abiding,” he said. “It’s focused on a shared series of threats, but also, on a shared series of values that one particular instance is not going to inform overwhelmingly.”

The White House Chief of Staff said he could not “guarantee” that an administration official hadn’t made the remarks about Netanyahu, but said he had no idea who might have said them. “It’s not me. It’s not the President,” McDonough told interviewer Chuck Todd.

House Speaker John Boehner invited Netanyahu to deliver an address to a joint session of Congress when he visits the U.S. in March, without informing the White House first. The trip coincides with negotiations between the U.S. and others with Iran on their nuclear capabilities, which are strongly opposed by Israel and by some in Congress.

The White House said President Obama would not be meeting with Netanyahu during his visit, out of concerns that it might influence the Israeli elections due to take place two weeks after his trip.

The decision has been portrayed as a snub by the Israeli media, though McDonough said on Meet the Press that the principle would be the same for any other ally. “We think as a general matter we in the U.S. stay out of internal politics of our closest allies,” he said.

In a separate interview on ABC’s This Week Sunday, McDonough urged Congress not to pass new sanctions on Iran while the nuclear negotiations are ongoing.

“We’ve asked Congress for forbearance, for some time to allow us to run these negotiations so that it is we who are, united with our allies, maintaining Iran isolated, rather than going with some kind of premature action up there on the Hill that would risk really splintering the international community, making it we, not the Iranians, who are isolated,” he said.

TIME Innovation

Five Best Ideas of the Day: January 12

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

1. On the fifth anniversary of the Haiti earthquake, political strife is still the greatest obstacle to recovery.

By Jacqueline Charles in the Miami Herald

2. The U.S. uses economic sanctions because they don’t require a global coalition to work. But they may inflict damage beyond the intended target.

By Paul Richter in the Los Angeles Times

3. With deepening partisanship becoming the norm, don’t look to the states for new ideas.

By Aaron Chatterji in the New York Times

4. Juries could use virtual reality headsets to ‘visit’ crime scenes.

By Jessica Hamzelou in New Scientist

5. A new waterproof solar lantern is helping reduce deaths from burning fuel indoors for the world’s 1.2 billion living without electric light.

By Michael Zelenko in the Verge

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

TIME Innovation

Five Best Ideas of the Day: December 18

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

1. By breaking with the Cuba lobby, President Obama could massively disrupt American interest group politics.

By Noah Feldman in the Salt Lake Tribune

2. Sony can take a stand against the hackers whose threats have forced them to pull “The Interview” by giving the movie away online.

By Bryan Bishop in the Verge

3. Could the West help save the ruble without throwing Putin a lifeline?

By Juliet Johnson in the Globe and Mail

4. By tracking rising global temperatures, satellites can predict cholera risk.

By Dr. Kiki Sanford in BoingBoing

5. After the Taliban’s shocking attack on a school in Pakistan, the military there understands “the Frankenstein that it helped to create must now be killed.”

By Peter Bergen at CNN

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

TIME europe

German Chancellor Says Russia’s Actions Are Unjustifiable

Chancellor Angela Merkel in the lower house of parliament Bundestag in Berlin, Nov. 26, 2014.
Stefanie Loos—Reuters Chancellor Angela Merkel in the lower house of parliament Bundestag in Berlin, Nov. 26, 2014.

Angela Merkel appears to be taking a tougher stance against Vladimir Putin

German Chancellor Angela Merkel Wednesday suggested she is prepared for a drawn-out confrontation with Russian President Vladimir Putin over the Ukraine crisis

“We need patience and staying power to overcome the crisis,” Merkel told German lawmakers in a speech to Berlin’s parliament. She added that economic sanctions on Russia “remain unavoidable” as long as government forces continue to battle pro-Russian separatists in eastern Ukraine, Bloomberg reports.

Merkel continued that while the crisis may have been triggered by Russia’s concerns over the impact of Ukraine’s free trade agreement with the European Union, “none of this justifies or excuses Russia’s annexation of Crimea.”

Russia’s actions, she said, interrupt “the peaceful international order and breach international law.”

MORE: Russia wants a “100% guarantee” that Ukraine won’t join NATO

The German chancellor’s speech to parliament follows an address Merkel made in Australia Monday, during which more openly critical of Putin than in the past, suggesting her patience with Putin is running out after months of negotiations. Merkel and Putin met during the G20 conference, but that reportedly did not go well for either leader.

[Bloomberg]

TIME russia

Russia’s Lackluster Economy Means Putin Simply Can’t Afford a New Cold War

Vladimir Putin
Alexander Zemlianichenko—AP Russian President Vladimir Putin prepares to toast with ambassadors in the Alexander Hall after a ceremony of presentation of credentials by foreign ambassadors in the Grand Kremlin Palace in Moscow, Russia, Wednesday, Nov. 19, 2014.

Moscow needs the West

One of the axioms of global geopolitics is that a country can project power only as far as its economic might allows. There is good reason why the United States, by far the world’s largest economy, has been the dominant force in all things political and military for the past 60 years. And we can see China now rising to superpower status on the back of its spectacular economic ascent.

Vladimir Putin should take note. As Russia’s president attempts to reassert his nation’s clout in Europe, he is doing so on an ever shakier economic foundation. The question for Putin going forward is whether his stumbling economy can support his geopolitical ambitions. The answer is anything but clear.

Russia’s economy was struggling even before Putin’s adventurous foray into Ukraine. The country had been one of the high-fliers of the developing world, so much so that Goldman Sachs included Russia in its BRICs — the emerging economies that would shape the economic future — along with Brazil, India and China. But a feeble investment climate, endemic corruption and excessive dependence on natural resource exports eventually laid Russia low. Growth last year sunk to only 1.3%, down from the 7% to 8% rates experienced a decade ago.

Since Putin’s intervention in Ukraine, Russia’s economic situation has worsened severely. GDP inched upwards only 0.7% in the third quarter from a year earlier, and the International Monetary Fund is forecasting mere 0.2% growth for all of 2014. Sanctions imposed by the U.S. and European Union in the wake of Putin’s intervention in Ukraine have blocked some major Russian banks and companies from accessing financing in the West, starving them of much-needed foreign capital. As a result, the value of the Russian currency, the ruble, has deteriorated by 30% against the dollar so far this year, routinely hitting new record lows along the way.

In a recently released study, the European Bank for Reconstruction and Development predicted that Western sanctions would help push Russia into a mild recession in 2015. Sanctions, the bank noted, “negatively affected business confidence, limited the ability of companies and banks to access international debt markets and contributed to an increase in private capital outflow.”

Meanwhile, Putin’s countermeasures have made matters worse. His decision to ban the import of some foodstuffs from the West has caused prices for fresh produce and other necessities to rise. Combined with the weakening ruble, that’s pushing up inflation, which bites into the pocketbook of the average Russian family. Moscow’s economy minister recently said that he expects inflation to exceed 9% by early 2015. The nasty mixture of a depreciating currency and escalating prices have forced the central bank to hike interest rates, which will act as a further drag on growth.

Headwinds from the global economy are making matters even worse. Tumbling oil prices spell bad news, both for overall growth and the financial position of the government, which is reliant on tax revenues from its energy industry to fund the budget. In 2013, oil and gas accounted for 68% of Russia’s total exports, while duties on those exports, combined with taxes on mining, accounted for 50% of the federal government’s revenue.

Putin so far hasn’t flinched. Instead, he has been scrambling to evade Western sanctions and find new sources of exports and investment in Asia. On the sidelines of the Asia-Pacific Economic Cooperation summit, held in Beijing this month, Russia agreed to a deal to supply even more natural gas to China, on top of a $400 billion pact inked earlier this year.

That “pivot” to Asia will take time to bear fruit, however. Right now, none of the negative factors damaging Russia’s economic prospects look likely to turn positive any time soon. “We expect the stagnation trend to continue and potentially accelerate next year, exacerbated by lower oil prices, tighter monetary policy and continued uncertainty on the geopolitical front,” noted Barclays economist Eldar Vakhitov in a recent report.

Still, Putin’s economic woes haven’t yet translated into political problems. The Russian public appears to be patriotically rallying around Putin’s aggressive foreign policy and setting aside concerns about the economic fallout. In the latest poll conducted by the Levada Center, a Moscow-based independent research organization, an amazing 60% of the respondents said they believed that Russia was heading in the right direction, up significantly from 40% a year earlier. Putin’s approval rating stands at an even more astronomical 88%.

What the future may hold is another issue. A good part of Putin’s political success has been based on his record of improving people’s welfare, but with no relief in sight for Russia’s economic troubles, it may only be a matter a time before the general populace begins to feel the pinch more sharply. Nor can Putin ignore his economy’s need for foreign investment and technology to upgrade industry and create jobs. He may eventually find himself facing a critical choice — maintaining his foreign policy goals or softening his stance towards the West out of economic necessity.

Recall that the Soviet Union collapsed, after all, because its economy could not sustain its international policies. Putin has to watch that history doesn’t repeat itself.

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