Latest Covid-19 Omicron BA.5 variant has landed Malaysia! Understanding the Omicron BA.5 subvariant

Five things we've learned about the BA.4 and BA.5 Omicron variants

 

Malaysia entering new Covid-19 wave as Omicron BA.5 variant hits

Malaysia is entering a new Covid-19 wave, with the Omicron BA.5 variant already present in the country.

Health Minister Khairy Jamaluddin said the ministry had already detected five BA.5 variants through genomic sequencing as of June 30.

"This means that BA.5 is already present in the country. These cases were found through genomic sequencing on positive cases between May and June.

"There is a big possibility that BA.5 has already spread widely in Malaysia," he told a press conference at Parliament today.

Meanwhile, Khairy said the country has seen a 31 per cent increase in Covid-19 cases from July 3 to 7.

He informed that hospitalisations had also increased by 13.7 per cent, from 835 patients last week to 968 patients this week.

"A majority of the cases are in categories one and two. This is something that we have expected," he said.

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KUALA LUMPUR: Five cases of the fast-spreading Covid-19 Omicron BA.5 variant have been detected in the country, says Health Minister Khairy Jamaluddin.

He warned the public that the ministry expected the number of Covid-19 cases to rise in the next few weeks as the newer Omicron variants spread easily.

ALSO READ: KJ: We may issue compounds if cases spike

Apart from these five cases, other cases of Omicron sub-lineage variants that have been detected were six cases of BA.2.12.1 and two incidents of BA.5.2.

“All these cases were detected between May and June. However, there are no cases of sub-lineage Omicron BA.4 recorded so far.

ALSO READ: Bracing for another wave of Covid-19 infections

“We are expecting that new infections will increase due to Omicron BA.4 and BA.5, especially the BA.5. This is because Omicron BA.5 spreads easily compared with previous Omicron variants BA.1 and BA.2,” he told a press conference here yesterday.

Khairy said the new Covid-19 wave should not be taken lightly as 4,020 cases were reported just on July 7.

ALSO READ: Many having second thoughts on second booster

From July 3 to 7, the ministry had already recorded 14,967 cases, which is an increase of 31% compared with the previous week’s 11,394 cases, he added.

There was also a 13.7% increase in hospital admissions to 968 patients during this period from the 835 patients in the previous week. Ten deaths were recorded.

He added that those who have completed their Covid-19 vaccination or had been infected previously could also be infected with this variant.

“Those who have not taken their booster, especially senior citizens and people who have comorbidities, should get their booster shot, as it is vital against the new wave of Omicron BA.5.

“A total of 7,393,199 (31.40%) people have not taken their first booster shot while 151,018 (6.06%) individuals have received their second booster shot as at July 7,” he said.

Khairy also said that the ministry’s technical committee was still looking into the need for a second booster shot among those aged 60 and below without any illnesses, while vaccination for those aged five years and below was still not recommended.

However, he said there were some people who used a loophole with the excuse of travelling to get a second booster shot.

The second booster is available free of charge at registered private vaccination centres listed at https://vaksincovid.protecthealth.com.my/find.

For those aged 18 to 59 in the immunocompromised category, Khairy advised they undergo an evaluation first before getting the second booster shot.

He also said that as at July 3, 4,001 patients who have taken the Paxlovid antiviral medicine showed no serious side effects. 

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Understanding the Omicron BA.5 subvariant

 

Malaysia is seeing a wave of new Covid-19 infections ever since two Omicron sub-lineage variants were first detected in the country last month.

The Omicron BA.5 sub-lineage has been pushing up cases everywhere from the United States to nearby Singapore.

According to the World Health Organisation (WHO) in its weekly epidemiological update on July 6, the BA.5 is present in 83 countries.

“Although BA.4 is also rising globally, the rate of increase is not as high as that of BA.5.

“BA.4 has been detected in 73 countries, and now accounts for 12% of all sequences submitted during week 25 (up from 11% in the previous week).

“BA.4 and BA.5 share similar mutations in SARS-CoV-2 spike but have different mutations in non-spike regions,” it said.

There is no evidence yet regarding any change in severity with BA.4, BA.5 or BA.2.12.1 as compared to BA.2. StarPicks APU grads are media and communication experts of the future

However, the rise in the prevalence of these three sub-lineages had coincided with an increase in cases in several WHO regions.

“In some countries, the rise in cases also resulted in a surge in hospitalisation, ICU admissions and deaths,” WHO said.

While studies are still being conducted, early data has shown that the BA.5 could be the most contagious variant so far.

A study in the New England Journal of Medicine, published on July 7, found that the three subvariants substantially “escape” neutralising antibodies from vaccination and infection.

“Moreover, neutralising antibody titers against the BA.4 or BA.5 subvariant and (to a lesser extent) against the BA.2.12.1 subvariant were lower than titers against the BA.1 and BA.2 subvariants, which suggests that the SARS-CoV-2 Omicron variant has continued to evolve with increasing neutralisation escape,” according to the study titled “Neutralisation Escape by SARS-CoV-2 Omicron Subvariants BA.2.12.1, BA.4, and BA.5”.

Reports suggest that the variants’ ability to evade immunity vaccines may cause a surge in infections.

Fever, runny nose, cough, sore throat, headaches, muscle pain and fatigue are some of the symptoms.

Health Minister Khairy Jamaluddin said on Friday that Covid-19 infections could increase, especially those caused by BA.5.

BA.5 was first detected in South Africa in February.

It has since become the dominant variant in driving infections up in the United States and most parts of Europe.

Last week, the Centers for Disease Control and Prevention said that BA.4 and BA.5 were estimated to make up a combined 70.1% of the variants in the United States as of July 2.

In Singapore, its Health Minister Ong Ye Kung said on July 5 that about half of the new cases in the republic were due to the BA.4 and BA.5 subvariants. He estimated that this could go up to 80% this week.

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Financial literacy and bankruptcy

 

Stretching your ringgit: The importance of knowledge in this space cannot be more timely, especially when Malaysians are doing their level best to stretch their ringgit in order to cope with the increasing cost of living from inflationary pressures, which are spiralling out of control.

It is not enough to be good at your job. Managing your money well is as important as having good hygiene.

Lack of financial discipline reasons for bankruptcy

Using a credit card or apps wisely to accumulate points for future spending, waiting for bargains such as free shipping options or vouchers on ecommerce platforms on special days of the months to purchase necessities are just a few examples of being financially aware. 

FINANCIAL literacy is an important agenda for a country’s economic well-being.

Most governments around the world would like for their citizens to be financially literate, be it entrepreneurs, working professionals, white collar or blue collar workers.

It is not enough to be good at your job. Managing your money well is as important as having good hygiene.

Recently, the Malaysia Department of Insolvency (MDI) reported that 287,411 people in the country have been declared bankrupt as of March 2022.

Between 2018 and May 2022, there was an increase of 46,132 new bankruptcy cases.

Of this number, 59% (amounting to 27,365) of the bankrupt were aged below 44.

This led to the Prime Minister highlighting his concern on youth bankruptcy and requesting for the relevant authorities to look into this matter including potentially revamping the laws on insolvency.

It is important to note that due to the pandemic, our government has in fact raised the threshold of bankruptcy from RM50,000 to RM100,000 in 2020.

Many legal actions against defaulters of loans were also postponed due to the effects of the pandemic.

Personal loan main reason for default

Diving into the MDI’S statistics, I realised that the main reason for bankruptcy was due to default of personal loans with an overwhelming percentage at 42%, followed by hire-purchase loans (15%) and business loans (13.5%).

Personal loans have often been touted to charge exorbitant interest rates, especially credit card schemes.

A simple illustration: when month end comes, there are often three options to settle your credit card bill, namely statement balance, outstanding sum or minimum sum.

The right thing to do would be to settle the statement balance. Settling the outstanding sum in full means that the credit card user is paying down the credit card debts which isn’t yet due, which defy the purpose of utilising credit card in the first place.

Paying only the minimum sum, which many people often do, would lead to one incurring high interest on the outstanding credit card debt.

This would snowball to levels which are highly exorbitant.

The statistics above is telling because it shows that excess consumption pattern is a key reason for bankruptcy.

In terms of youth bankruptcy, it makes sense especially with social media propagating binge spending, splurging on luxury goods and the shallow mindset of keeping up with the Joneses.

Living beyond one’s means owing to social pressure simply isn’t going to go out of fashion, more so in today’s digital age.

Proliferation of get-rich-quick schemes and scams

There is no doubt the lack of financial discipline and bad spending habits are reasons which contribute to this social issue.

However, I believe another major contributing factor is the increasing number of scams and get-rich-quick schemes. These schemes often tap on the most vulnerable segment of the society, namely those who are greedy, desperate or naive.

Greed is one of human nature’s biggest weaknesses. Despite the evolution of mankind, this primal instinct has continued to flow through the DNA of mankind. I do not doubt the importance of greed as a driver for progress, but too much and it becomes fatal.

Desperation, especially in the case of hardcore poverty or extreme emergency without anyone to rely on, there is hardly any choice to seek help.

We have seen this episode played out, especially in the times of economic recession, high unemployment not unlike the period of pandemic we have all been through recently.

Of the three, the most addressable would be the one who is naive, in short, one who lacks the necessary knowledge.

Stretching your ringgit

The importance of knowledge in this space cannot be more timely, especially when Malaysians are doing their level best to stretch their ringgit in order to cope with the increasing cost of living from inflationary pressures, which are spiralling out of control.

I would like to put it on record: Accumulating financial knowledge does not mean becoming an investment prodigy. It can be as simple as understanding the various options for people to stretch their money.

One of the most common savings hacks would be to channel your monthly salary to a “flexi” or “semi-flexi” home loan account. This simple gesture every month automatically lowers the interest on the loan to be incurred.

Your unused funds will be utilised to further reduce the principal and interest while you have the option to withdraw the excess amount if you require to use the funds.

Using a credit card or apps wisely to accumulate points for future spending, waiting for bargains such as free shipping options or vouchers on ecommerce platforms on special days of the months to purchase necessities are just a few examples of being financially aware.

Of course, the best thing to do is to be prudent in spending, in essence practicing delayed gratification at all times.

The best investment is knowledge

It is a good sign that there is an increasing number of licensed financial professionals such as Chartered Financial Analysts and Certified Financial Planners out there today.

We also do see many more collaborative efforts between industry professionals working hand in hand with regulators in adopting social media to reach out to the masses.

With the advent of social media, it is also crucial to sift out genuine financial literacy advocates. After all, there are many free resources online today.

It is not to say the smartest people from the top of their professions cannot be hoodwinked. We have seen how 34-year-old Ng Yu Zhi of Envy Asset Management and Envy Global Trading swindled prominent people like the general counsel for Temasek Holdings Pek Siok Lan, criminal lawyer Sunil Sudheesan, ex-president of the Law Society Thio Shen Yi, chairman of Vickers Capital Group Finian Tan and CEO of Chuan Hup Holdings Terence Peh, among others.

This purported nickel trading scheme amounting to S$1bil (Rm3.2bil) was the largest fraud or Ponzi scheme in Singapore’s history. The best part, red flags were obvious where both of the perpetrator’s entities above were not licensed by Monetary Authority Singapore and he was promising 15% returns in three months to his clients.

Ultimately, it comes down to the individual and a good sense of financial awareness when managing one’s own hard-earned money.

The best investment is in yourself. Whether it is learning a new skill or advancing your education, self enrichment gives the best return on investment.

As Benjamin Franklin once said, “An investment in knowledge pays the best interest”. He can’t be wrong considering his face is literally on the US dollar bill even till today. - StarBiz,

Ng Zhu Hann, the CEO of Tradeview Capital. He is also a lawyer and the author of “Once Upon A Time In Bursa”. The views expressed here are the writer’s own.

 

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BANK NEGARA RAISES OPR TO 2,5% , Still a good hedge against inflation

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MALAYSIA Upbeat GDP forecast between 5.3% and 6.3%, Inflation to hover between 2.2% and 3.2% in 2022

 

 

 

 

BANK NEGARA RAISES OPR TO 2,5% , Still a good hedge against inflation

 

 

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PETALING JAYA: The Monetary Policy Committee (MPC) of Bank Negara has increased the overnight policy rate (OPR) by 25 basis points to 2.25% amid positive growth prospects for the local economy.

“For the Malaysian economy, economic activity continued to strengthen in recent months.

“Exports and retail spending indicators affirm the positive growth momentum, supported by the transition to endemicity, “ the central bank said in a statement yesterday.

The ceiling and floor rates of the corridor of the OPR are correspondingly increased to 2.5% and 2%, respectively.

The OPR, which is a benchmark rate that allows banks to determine their lending and deposit rates, had been reduced by a cumulative 125 basis points during the course of the Covid-19 pandemic, bringing it to a historic low of 1.75%.

Yesterday’s increase was a second consecutive one after a 25-basis-point hike in May, which was also the first time the OPR was raised since the onset of the pandemic.

OCBC Bank economist Wellian Wiranto said the fact that the central bank had not gone more “ballistic” with a 50-basis-point hike yesterday speaks of a “heavy preference for a gingerly approach in tightening.”

“That is a prudent thing, given how global recession fears are on the rise,” he said.

Going forward, he said he expects at least one more 25-basis-point hike this year that will be seen as a further normalisation of policy rate rather than outright tightening.

“It might then pause in the last meeting of the year in November to assess the balance between inflation and recession risks before undertaking any action thereafter,“ he added.

In its statement, the central bank said the extent of upward pressures on inflation will remain partly contained by existing price controls, fuel subsidies and the continued spare capacity in the economy.

“The inflation outlook continues to be subject to global commodity price developments, arising mainly from the ongoing military conflict in Ukraine and prolonged supply- related disruptions, as well as domestic policy measures,“ it said.

Year-to-date, headline inflation averaged 2.4%.

 

.In its statement, the central bank said the extent of upward pressures on inflation will remain partly contained by existing price controls, fuel subsidies and the continued spare capacity in the economy.

“While it is projected to remain within the 2.2%-3.2% forecast range for the year, headline inflation may be higher in some months due mainly to the base effect from electricity prices.

“Underlying inflation, as measured by core inflation, is expected to average between 2% and 3% in 2022, as demand continues to improve amid the high-cost environment,” it said.

Bank Negara said that in recent months, the unemployment rate had declined further, with higher labour participation and improving income prospects.

“Looking ahead, while external demand is expected to moderate, weighed by headwinds to global growth, economic growth will be supported by firm domestic demand.

“Additionally, the reopening of international borders since April 1 would facilitate the recovery in tourism-related sectors.”

Nevertheless, the central bank warned of downside risks to growth that continue to stem from a weaker-than-expected global expansion, further escalation of geopolitical conflicts and worsening supply chain disruptions.

“Even as it continues to project a strengthening economic recovery, things are likely to turn less rosy from here,” OCBC’s Wiranto said.

Bank Negara said that at the current OPR level, the stance of monetary policy remained accommodative and supportive of economic growth.

“The MPC will continue to assess evolving conditions and their implications on the overall outlook to domestic inflation and growth.

 

Rakuten Trade head of equity sales Vincent Lau told StarBiz yesterday’s hike was a reflection of confidence in the continued growth of the Malaysia economy.

“Any adjustments to the monetary policy settings, going forward, would be done in a measured and gradual manner, ensuring that monetary policy remains accommodative to support a sustainable economic growth in an environment of price stability.”

Meanwhile, Rakuten Trade head of equity sales Vincent Lau told StarBiz yesterday’s hike was a reflection of confidence in the continued growth of the Malaysian economy.

“With the increase in our benchmark rate, this may also stem the outflow of foreign money, which will technically see higher returns alongside the higher rate,” he said.

That said, the stock market fell over 20 points at the close yesterday after the hike was announced.

“It was probably a knee-jerk reaction as the hike had more or less been priced in already,” Lau said.

Bursa Malaysia’s fall was also in line with most regional markets as the fear of a global recession continued to rear its ugly head.

Nevertheless, at the close of the market yesterday, lenders like Malayan Banking Bhd and CIMB Group Holdings Bhdfinished higher as investors bought the stocks, banking on a higher OPR that could likely boost the lenders’ earnings. 

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Still a good hedge against inflation 

 

 https://www.thestar.com.my/business/business-news/2022/07/07/still-a-good-hedge-against-inflation

 

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US seeks China's help to ease inflation in latest interaction

The US looks at reducing China tariffs amid soaring inflation in the country 

 

US and China Discuss Trump-Era Tariffs Biden May Ease

Yang Jiechi (center), a member of the Political Bureau of the Communist Party of China Central Committee and director of the Office of the Central Leading Group for Foreign Affairs, criticizes human rights issues in the US at the opening session of US-China talks in Anchorage, Alaska on March 18, 2021. Photo: AFP

 

The US is seeking help from China to ease its economic pressure, hinting that it may ease tariffs on Chinese goods and engage in dialogue with senior Chinese officials more often. However, analysts said Beijing will approach Washington's overtures with caution, as it is still trying to use the tariffs as bargaining chips rather than sincerely correcting its mistakes that have harmed both sides.

Chinese Vice Premier Liu He, a member of the Political Bureau of the Communist Party of China (CPC) Central Committee and chief of the Chinese side of the China-US comprehensive economic dialogue, held a conversation via video link with US Secretary of Treasury Janet Yellen at the latter's request on Tuesday morning, according to the Xinhua News Agency.

As agreed by China and the US, Chinese State Councilor and Foreign Minister Wang Yi will meet with US Secretary of State Antony Blinken during the meeting of G20 foreign ministers, Chinese Foreign Ministry announced on Tuesday. In June, the defense chiefs of both sides met in Singapore on the sidelines of the Shangri-La Dialogue, and Yang Jiechi, member of the Political Bureau of the CPC Central Committee and director of the Office of the Central Commission for Foreign Affairs, met with US National Security Advisor Jake Sullivan in Luxembourg.

Such frequent communications between senior officials of the two sides show that China and the US are making efforts to manage the differences and competition to prevent escalation caused by miscalculations, while at the same time, the US is trying to seek China's help to ease the serious inflation the US is being confronted with, analysts said.

Chinese analysts said on Tuesday that although its economy is in disarray, the US is still being provocative in geopolitical issues to contain China. This means the US should not expect China to provide significant support for it to solve its domestic problems. The US tariffs have turned out to have a limited impact on the Chinese economy, and these are just part of the mistakes that the US must correct to bring bilateral ties back on track.

Heavy pressure

During the Liu-Yellen conversation on Tuesday, the two sides had a pragmatic and candid exchange of views on such topics as the macroeconomic situation and the stability of global industrial and supply chains. Their exchanges were constructive, the Xinhua reported on Tuesday.

The two sides agreed that as the world economy is facing severe challenges, it is of great significance to strengthen macro-policy communication and coordination between China and the US. Jointly maintaining the stability of global industrial and supply chains is in the interests of both countries and the whole world. The Chinese side expressed its concern about issues including the lifting of additional tariffs on China and sanctions by the US side, and fair treatment of Chinese enterprises, the Xinhua reported.

Lü Xiang, a research fellow at the Chinese Academy of Social Sciences, told the Global Times on Tuesday that the US has been forced to engage with China because of its dreadful domestic economic situation.

"Joe Biden now is having a big headache as his approval rating is even lower than his predecessor Donald Trump at the same stage of presidency, which is a great humiliation. The pressure to win the midterms is heavy and serious, so he must find solutions to at least make some changes," Lü said.

Biden's approval rating was 39 percent as of June 30, according to an analysis by poll tracker FiveThirtyEight, while 56.2 percent of Americans disapproved of the way the president is handling his job, according to the Newsweek.

Trump's approval rating on July 1, 2018 was 41.8 percent, while 52.3 percent of Americans disapproved of him, figures from FiveThirtyEight show.

In 2018, Republicans suffered a major defeat in the midterm elections and lost 40 seats in the House of Representatives, handing control to the Democrats and allowing Nancy Pelosi to return as speaker.

Experts said the main factor that could influence the midterms later this year is the economy, so if the Biden administration cannot deliver some positive changes to ease inflation and gas prices and stop the economic decline, the Democrats are likely to repeat the failure of the Republicans in 2018.

Far from easing tension

According to Bloomberg on Tuesday, Biden may announce as soon as this week a rollback of some US tariffs on Chinese consumer goods - as well as a new probe into industrial subsidies that could lead to more duties in strategic areas like technology.

Although decreasing tariffs on Chinese goods has become an option for the US to solve some of its economic problems, it is still not clear what measures the US government will take next, experts said.

According to one estimate by the New York Federal Reserve, US tariffs imposed on Chinese goods through the middle of 2019 cost the American household an average of $831 per year.

"Decreasing tariffs on Chinese goods is a way to decrease inflation without the danger of hurting economic growth, but the US is not sure about the extent to which the tariff cuts would be effective in controlling price hikes. Therefore, the US government is still worrying about gains and losses and can't make up its mind," Gao Lingyun, a trade specialist with the Chinese Academy of Social Sciences in Beijing, told the Global Times on Tuesday.

Bai Ming, deputy director of the international market research institute at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times on Tuesday that "under the US' general strategy of containing China's rise, which is unlikely to change in the short term, the US might adjust some of the punitive tariffs on Chinese consumer goods, but at the same time intensify pressure on China, such as increasing sanctions on Chinese tech firms."

Lü said that judging from the US' failed COVID-19 pandemic response, Afghanistan withdrawal, inflation and the Ukraine crisis, we found "the US system of command is problematic, and the coordination between White House staff and cabinet officials is desperately wanting. Therefore, in the future, we have to be prepared for many uncertainties and even some overnight contingencies." He added that it is caused by the problematic decision-making system of the US side.

What should China do?

Gao said that China should insist on an reciprocal tariff policy with the US, meaning cutting the same amount of tariffs on US goods if the US reduces tariffs on Chinese products. China should also insist that tariff reductions should bring benefits to both countries, he said.

Bai noted that China should stick to its dual circulation policy, especially focusing on internal circulation so external policies would not affect China's economy to a great extent.

Chen Jia, a research fellow at the International Monetary Institute of the Renmin University of China, said that market data show that the US economy is deeply bogged down in stagflation, while recessionary risks are increasing, which means the US is still far from reaching a turning point to stop its economic situation from worsening.

On the other hand, the US is not making even small concessions in global strategies, rather it is showing an inclination to toughen the strategic encirclement of China, such as the recent Partnership for Global Infrastructure to target the China-proposed Belt and Road Initiative.

"If the US is willing to seize the opportunity to restart China-US high-level communication on the basis of economic cooperation, and move to repair the damage it has caused in the past, China would of course welcome and support those moves. But if the US continues to treat its global partners arrogantly, then it won't get any help from developing countries including China," Chen told the Global Times. 

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Whither the international rules-based order?

 

 

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 The United States’ so-called rule-based order is  gangsterism while its sanctions on other countries are illegal, a renowned Canadian lawyer has said a recent interview. Christopher Black, a veteran Canadian lawyer who has been involved in a number of high-profile cases, including defending former Yugoslav President Slobodan Milosevic, strongly condemned actions from the U.S. and the U.S.-led North Atlantic Treaty Organization (NATO), which have repeatedly accused other countries of destroying postwar international orders, portraying themselves defenders of international order. The lawyer believes that U.S. sanctions on other countries are illegal and are a ploy to defend its economic wars against other countries.

 

 

 China's challenge to the rules-based order 

 

 

Top priority: The moral principle that we all should live peacefully on one planet should over-ride sovereign nations fighting over power and ego from turf to space, when humanity could be burned by climate warming or nuclear war. — AFP

 

EVERYDAY, we are told we must defend the rules-based order. But whose order? What rules? Why should we defend an order if we did not have a say in shaping?

All this is in the realm of politics and geo-politics. The biggest thinker who shaped the current neoliberal order was Austrian philosopher Friedrich Hayek (1899-1992), whose ideas of classical liberalism of freedom, democracy and self-order of markets dominated global relations.

Neoliberalism was put into practice in the 1980s, when US President Ronald Reagan and British Prime Minister Margaret Thatcher pushed through the free market philosophy that swept away Keynesian state intervention of the 1950-1970s.

The deeper thinker on the whole question of constitutional law, politics and international order was German jurist Carl Schmitt (1888-1985), whose influence on conservative political circles in almost all the Big Powers has been growing.

I only became aware of Schmitt’s work when Noema magazine wrote an editorial on Schmitt’s Nomos of the Earth (1950).

Schmitt is controversial, because he essentially wrote the legal basis for Nazism in the 1920s, which accounts for his ostracisation (in today’s language “cancelled”) from academic circles for decades.

 

Main priority: A demonstration calling on the German government not to intervene in the ongoing conflict in the Ukraine, in Berlin. The moral principle that we all should live peacefully on one planet should over-ride sovereign nations fighting over power and ego from turf to space, when humanity could be burned by climate warming or nuclear war. — AFP

Schmitt was a brutally realist thinker who explored the legal foundations of European political theory. Schmitt argues that no order can function without a sovereign authority. A state is legally constituted when the politics distinguishes between friend and enemy and when the citizens are willing to fight and die for its identity. The state alone is given the power of violence (and enforcement) by the citizens to enforce the law.

Schmitt is considered an authoritarian supporter, because he saw sovereign power resting ultimately in the Executive (rather than the Legislature or Judiciary) because the sovereign (i.e. the President) decides on the exceptional situation, where he/she must suspend the law because of war or assume emergency powers in order to restore order.

Decisions by the Executive are either bound by law or bounded by his or her moral bearings.

The world is today watching on TV whether former President Trump is morally culpable for causing the Jan 6, 2021 riots, or legally culpable.

The Ukraine war is being supported by the North Atlantic Treaty Organisation or Nato on a matter of moral principle for a non-member, but if the war escalates to nuclear global destruction that kills all, how do we trade off the individual rights with the collective right of everyone else to survive?

Schmitt dissected the European constitutional laws and international order, dividing them into three phases: pre-1500, 1648 to 1919 (World War I) and thereafter.

Before the discovery of America, European powers fought each other under a religious cloak, since the Pope decided on disputes of rights on moral grounds.

Indeed, it was the Papal Bulls of 1455 and 1493 that authorised the Portuguese and Spaniards to conquer all lands and seize and enslave Saracens and non-Christians in the Americas, Africa and Asia.

The religious rationales comprised the Domination Code whereby Christians can rule over non-Christians and possess their property, as well as the Discovery Code, whereby land owned by non-believers are treated as terra nullius (empty land), meaning non-Christian indigenous peoples do not have rights.

But when the Dutch and English started fighting with the Portuguese and Spaniards over overseas territories, what was the legal justification?

Dutch jurist Grotius (1583-1645) provided the secular rationalisation that discovery alone is not enough, but since there was freedom in the seas, occupation by a sovereign state confirms rights seized through war.

Schmitt argued that Jus Publicum Europaeum (European Public Law) emerged after the 1648 Treaty of Westphalia to allow sovereign countries to have the right to go to war based on their own judgement of justice and necessity without interference in each other’s domestic affairs.

This changed after the end of the First World War, when the 1919 Treaty of Versailles treated the losing side as criminals, with their rights cancelled or confiscated.

While the Europeans were busily fighting each other, the United States rose in global power and imposed its 1823 Monroe Doctrine that asserted that it has its own sphere of influence, with the right to intervene in Central and South American states.

That sphere of influence would spatially cover cultural, economic, military, political and today technology exclusivity beyond legal sovereign borders.

Schmitt was prescient in seeing that where war is fought on the basis of “good versus evil”, in which all rights of the other side are “cancelled” (like the foreign exchange assets of Afghanistan and Russia are frozen or seized), the situation may be an unstable equilibrium.

The unstable European security architecture was settled decisively by the United States in two World Wars because of her overwhelming military, economic and industrial power.

But in today’s multipolar situation, who decides on the rules of the international order? If both sides accuse the other side as evil and illegitimate, who decides other than the use of arms?

To cut a complex story short, the Nato military alliance, comprising nearly one billion people and 47.3% of the world’s gross domestic product or GDP (2020) assumes its status quo role as the final arbiter of the “rules-based order”.

The problem is that BRICS countries (Brazil, Russia, India, China and South Africa), plus Indonesia have 3.5 billion population with one quarter of world GDP in market terms (25.6%).

However, on GDP PPP terms, they are near parity with Nato and therefore may have their own views on the international order. What if the larger non-Western countries want their own version of the Monroe Doctrine?

The moral principle that we all should live peacefully on one planet should over-ride sovereign nations fighting over power and ego from turf to space, when humanity could be burned by climate warming or nuclear war.

For Nomos (or order) of the Planet, rather than the Earth, we should all rationally cooperate. If we truly believe in democracy, can the eight billion people in the world vote on the rules-based order, or do we still leave it to G-7?

No order is stable without true legitimacy on democratic principles. How to achieve that order remains a truly open question.

Andrew Sheng writes on global issues from an Asian perspective. The views expressed here are the writer’s own. 

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