Last videos
Australian economy Crisis
Australia is facing a suite of troubling economic trends. Growth is slowing, prices are rising and people’s living standards are slipping. Despite a headline unemployment rate that remains around 4.3 %, officials warn that the economy may be trapped in a slow‑growth, high‑inflation environment unless investment and productivity improve. Households are feeling the strain as wages fail to keep pace with costs and the housing market becomes increasingly inaccessible.Official national accounts show that the economy grew by only 0.6 % in the June 2025 quarter and by 1.3 % over the year; the terms of trade fell and the household saving ratio slid to 4.2 %. Living cost indexes rose between 0.6 % and 1.5 % in the September quarter, with housing and recreation costs making the biggest contribution. Consumer prices increased 1.3 % in the September quarter and 3.2 % over the year, while wages grew only 0.8 % in the June quarter and 3.4 % annually. The resulting squeeze on household budgets is causing real incomes to stagnate.Underlying inflation has accelerated to around 3 %, reflecting higher electricity, fuel and services prices. The September inflation pulse overshot forecasts and dashed hopes of a quick rate cut; electricity prices jumped 9 % in the quarter, holiday travel costs rose 2.5 % and local government charges climbed 6.3 %. Analysts note that real wages are unlikely to regain their 2011 purchasing power until the latter part of this decade.Housing is the most visible symptom of the malaise. About one‑third of households rent, and median advertised rents have increased by roughly 48 % over the past decade; they rose 5.5 % between the first quarter of 2024 and the first quarter of 2025. More than 1.26 million low‑income households spend over 30 % of their disposable income on housing, including 44.5 % of mortgage holders and 20.5 % of renters. Median house prices have risen by 8.6 % in the past year, far outpacing incomes, and home values rose 1.1 % in October alone. Investor lending now accounts for two in every five new home loans, with the value of these loans rising 17.6 % and calls emerging for regulators to curb landlord credit growth. A government scheme allowing first‑home buyers to borrow with a 5 % deposit effectively grants buyers the equivalent of a $120 000 deposit on an $800 000 home; critics warn that this incentive fuels investor speculation and pushes up prices.Mortgage stress is spreading. Research shows that 27.9 % of mortgage holders were at risk of stress in the three months to August 2025, with 17.9 % extremely at risk. Nearly one million Australians now work two or more jobs – 6.6 % of the employed population – because rising living costs and inflation are outpacing wage growth. Taking on additional employment has become a coping strategy for households trying to meet mortgage repayments and other bills.Young Australians are particularly pessimistic. A national survey found that 85 % of young people experienced financial difficulty in the past year and almost four‑fifths believe they will be worse off than their parents. Fewer than half expect to own a home, and about 44 % have experienced unemployment while 60 % have endured underemployment. Poverty is widespread: more than one in seven people (14.2 %) and one in six children live below the poverty line, defined at 50 % of median after‑tax household income, and more than 57 % of low‑income renters are in housing stress. Rents in major cities have risen between 34 % and 41 % since 2021, deepening financial hardship.Beneath the veneer of a modestly strong labour market lie deepening structural problems. Per‑capita economic output has contracted at various points over the past two years, and productivity growth has slowed. Officials acknowledge that without a revival of investment and productivity, the country risks a prolonged period of sluggish growth and persistent inflation. Rising housing costs, real wage stagnation, mortgage stress and youth pessimism all point to an economy that is leaving many behind. Unless these issues are addressed with urgency, something terrible will indeed continue to happen in the Australian economy.
Europe’s power shock
On 28 April 2025, an unprecedented power failure plunged most of Spain and Portugal into darkness. Within seconds the Iberian Peninsula lost around 15 gigawatts of generation—roughly 60 % of demand. Flights were grounded, public transport stopped, hospitals cancelled routine operations and emergency services were stretched. Spain’s interior ministry declared a national emergency, deploying 30 000 police officers, while grid operators scrambled to restore power. The outage, thought to have originated in a failed interconnector with France, highlighted the fragility of Europe’s interconnected grids. An industry association later reported that it took 23 hours for the Iberian grid to return to normal capacity.Energy analysts noted that the blackout was not only a technical failure but also a structural one. Spain and Portugal depend heavily on wind and solar power, which provide more than 40 % of Spain’s electricity and over 60 % in Portugal. These sources supply little rotational inertia, so when the France–Spain interconnector tripped the system lacked the flexibility and backup capacity to stabilise itself. Reliance on a single interconnector also left the peninsula “islanded” and unable to import power quickly.A continent on edgeThe Iberian blackout came against a backdrop of soaring energy prices, economic malaise and rising electricity demand from data centres and electrified transport. Europe has spent the past two years grappling with the fallout from Russia’s invasion of Ukraine, which cut cheap gas supplies and forced governments to scramble for alternative fuels. Germany’s Energiewende, once a model for the energy transition, has been strained. After shutting down its last three reactors on 15 April 2023, Germany shifted from being a net exporter of electricity to a net importer; by November 2024 imports reached 25 terawatt‑hours, nearly triple the 2023 level. About half of the imported electricity came from France, Switzerland and Belgium—countries whose power systems are dominated by nuclear energy. Germany’s gross domestic product shrank 0.3 % in 2023 and was expected to contract again in 2024, and a survey of 3 300 businesses found that 37 % were considering reducing production or relocating because of high energy costs; the figure was 45 % among energy‑intensive firms.The collapse of domestic nuclear generation has increased Germany’s reliance on coal and gas. In the first half of 2025 the share of fossil‑fuel electricity rose to 42.2 %, up from 38.4 % a year earlier, while power from renewables fell by almost six percent. Coal‑fired generation increased 9.3 % and gas‑fired output 11.6 %; weak winds cut wind output by 18 %, even as solar photovoltaic production jumped 28 %. The result has been higher emissions and greater dependence on imports.Yet Germany’s grid remains resilient: the Federal Network Agency reported that power disruptions averaged 11.7 minutes per customer in 2024—one of the lowest figures in Europe—and the energy transition has not compromised supply security. Nevertheless, researchers warn that unexpected shocks like the Iberian blackout could occur if investment in grid flexibility and storage does not keep pace.Nuclear renaissance across EuropeThe energy crisis has prompted many European governments to re‑examine nuclear energy. Belgium has repealed its nuclear‑phase‑out law and plans new reactors, arguing that nuclear power provides reliable, low‑carbon electricity. Denmark, Italy, Poland, Sweden and Spain have all signalled interest in building new plants or extending existing reactors. Italy intends to bring nuclear power back by 2030, while Denmark and Sweden are exploring small modular reactors. The European Union already has about 100 reactors that supply almost a quarter of its electricity. Nuclear plants emit few air pollutants and provide round‑the‑clock power, making them attractive for countries seeking to cut emissions and reduce reliance on gas. Critics remain concerned about waste disposal and the possibility that investment in nuclear could divert resources from renewables.This shift is visible at the political level. In September 2025, France and Germany adopted a joint energy roadmap that recognises nuclear energy as a low‑carbon technology eligible for European financing. The roadmap aims to end discrimination against nuclear projects and represents a departure from Germany’s long‑standing opposition. It does not alter national policies but signals a shared stance in forthcoming EU negotiations.Germany’s political U‑turnGermany’s nuclear exit has become a central issue in domestic politics. Surveys show that two‑thirds of Germans support the continued use of nuclear energy, and more than 40 % favour building new plants. A 2024 report argued that there are no significant technical obstacles to restarting closed reactors and that three units could be back online by 2028 if decommissioning were halted, adding about 4 gigawatts of capacity. The same report noted that a moratorium on dismantling reactors and amendments to the Atomic Energy Act are urgent prerequisites.During the February 2025 election campaign, conservative leader Friedrich Merz pledged to revive nuclear power and build 50 gas‑fired plants to stabilise the grid. His party’s manifesto proposed an expert review on restarting closed reactors and research into advanced technologies such as small modular reactors. In a surprising political shift, Merz’s government subsequently stopped blocking efforts at the European level to recognise nuclear power as a sustainable investment. At a Franco‑German summit in Toulon, he and French president Emmanuel Macron agreed on the principle of non‑discrimination for nuclear projects in EU financing.However, the internal debate is far from settled. Katherina Reiche, Germany’s economy and energy minister, ruled out a return to conventional nuclear plants, saying that the phase‑out is complete and that companies lack the confidence to invest. She argued that the opportunity to extend the last three reactors during the crisis had been missed and emphasised the government’s focus on developing a domestic fusion reactor and potentially small modular reactors. Reiche also insisted on a “reality check” for renewable expansion and called for up to 20 gigawatts of new gas‑fired backup capacity. Her position reflects caution within the coalition, and some experts note that restarting closed reactors may face legal and economic hurdles.Industrial relief and future challengesHigh energy costs continue to burden German industry. In November 2025 the ruling coalition agreed to introduce a subsidised power price of five euro cents per kilowatt‑hour for energy‑intensive companies until 2028, pending EU approval. The plan aims to ease the competitive disadvantage faced by manufacturers and includes tendering eight gigawatts of new gas‑fired capacity. Critics argue that subsidies are a stop‑gap and that longer‑term competitiveness requires affordable, low‑carbon baseload power and streamlined permitting for renewable projects.The Iberian blackout served as a warning that Europe’s future grid must be flexible and resilient. Analysts emphasise the need for more interconnectors, battery storage and demand‑side management to accommodate variable renewables. Germany’s grid reliability remains among the best in Europe, yet the country’s growing dependence on imports and fossil fuels raises concerns about security and climate targets. The energy crisis has revived nuclear energy as a serious option across Europe, forcing policymakers to balance decarbonisation with security of supply. Whether Germany fully embraces nuclear again remains uncertain, but the debate underscores a broader realisation: the energy transition requires a diversified mix of technologies, robust infrastructure and pragmatic policies rather than dogma.
New York’s lost Luster
New York City long prided itself on drawing the world’s brightest minds and deepest pockets. Yet the past decade has brought a slow ebb in the pool of people who power its economy. Population figures show the city’s ascent faltering: after years of growth, the number of residents began to decline in 2017 and then plunged by nearly half a million between April 2020 and July 2022. A modest rebound of about 120 000 people since 2022, largely through international migration, has not fully offset the losses. Domestic migration patterns reveal that most leavers initially head to suburbs around New York, but the states that gain the most are low‑tax, fast‑growing destinations such as Florida and Texas. High costs and quality‑of‑life concerns are recurring themes among those who leave.Recent estimates released in 2025 show that New York’s pandemic‑era population decline is reversing. The city added about 87 000 residents between July 2023 and July 2024, lifting its total population to roughly 8.478 million. The state as a whole gained around 130 000 residents over the same period, recouping one‑third of the half‑million people lost between April 2020 and July 2022. These two consecutive years of growth reflect improved counts of international migration and shelter populations. Nevertheless, net domestic outmigration remains substantial—around 121 000 people in 2024—though that figure marks the lowest level since 2013 and is largely driven by low‑ and middle‑income households.Millionaires and high‑earners: shrinking share of the nation’s wealthNew York’s public services depend heavily on a small number of wealthy residents. In 2022 millionaires represented less than 1 % of tax filers yet provided 44 % of state and 40 % of city personal‑income tax revenue. That reliance is threatened by a marked decline in the city’s share of national wealth. From 2010 to 2022 New York’s share of the United States’ millionaire households fell from 12.7 % to 8.7 %, dropping the state from second to fourth place behind California, Florida and Texas. While the number of millionaires in New York almost doubled during that period, comparable households more than tripled in California and Texas and quadrupled in Florida. Had New York retained its 2010 share of millionaires, the state and city would have collected about US$13 billion more in personal‑income tax in 2022.The erosion is visible in migration data. Between 2019 and 2020, tax filings show that the number of city residents earning between US$150 000 and US$750 000 fell by nearly six percent, while those making more than US$750 000 dropped by almost ten percent. A study of address‑change data compiled by the state’s tax department found that in 2020 and 2021 more than six percent of millionaire households updated their addresses to locations outside New York; by 2023 that rate had fallen to below three percent, but it remains higher than before the pandemic. Meanwhile, high earners pay a combined state and city marginal tax rate that can exceed 13.5 %, a national high. Moving to nearby Connecticut can save a household earning US$1 million more than US$70 000 a year in state and local income taxes, and a US$5 million property can attract roughly US$23 000–48 000 less in annual property taxes. Such disparities give affluent households incentives to move without losing access to New York’s cultural attractions.The pull of the Sun Belt and other competitorsThe magnetism of Florida and Texas rests not only on their sunny climates. Neither state levies an income tax, and both boast lower living costs. Census data released in January 2025 show that Florida gained around 64 000 residents from other states between July 2023 and July 2024, while Texas added more than 85 000. During the same period New York recorded a net domestic migration loss of roughly 121 000 people. A report tracking wealth flows found that between 2013 and 2022 New York lost about US$517.5 billion in cumulative resident income as households moved away, while New Jersey lost US$170.1 billion; Florida on the other hand gained over US$1 trillion. Average incomes of people relocating from New York to Florida’s Miami‑Dade and Palm Beach counties exceeded US$266 000 and US$189 000 respectively.Low taxes are not the only attraction. A detailed look at job trends reveals that New York is slowly losing ground in industries it once dominated. Since 1990 the share of city workers employed in finance and insurance has slipped from 11.5 % to 7.7 %. Of the 233 000 finance jobs created nationwide over the past five years, the state captured only 19 000. Major firms have been shifting managers and back‑office staff to lower‑cost markets such as Dallas, Salt Lake City, Alpharetta (Georgia) and Charlotte. New York’s combined state and local corporate tax rate can exceed 18 %, according to business associations; regulatory mandates on hiring practices and the high cost of compliance further add to operating expenses. These pressures encourage both start‑ups and established institutions to look elsewhere.Lifestyle factors compound the economic calculus. Median monthly rent in the city now exceeds US$3 600, more than twice the US$1 700 average across the 50 largest U.S. cities. Annual nursery‑care fees average about US$26 000 and basic car insurance costs roughly US$1 729—both among the highest in the country. The federal cap on state‑and‑local tax deductions introduced in 2017 has increased effective tax rates for wealthy residents. High costs of living and limited deductions are cited by some of the city’s billionaire investors, including Paul Singer and Carl Icahn, who moved to Florida in recent years.Business relocations and the corporate dripConcerns over the city’s direction intensified after proposals for higher income and corporate taxes gained traction in the 2025 mayoral election. In the weeks following the vote, state records in Florida show that at least 27 firms registered by New York owners applied to expand operations there, while nine filed to relocate entirely. The mayor of Boca Raton reported that four corporate headquarters are already planning moves to his city, and he has received “too many to count” inquiries since the election. Local economic‑development officials in South Florida confirm that investment bankers and hedge‑fund managers are increasingly scouting office space. Civic leaders have responded by offering targeted incentives and promising to address growing pains such as housing and transport.At home the city’s business landscape is changing. A moving‑industry report based on 24 million recorded moves found that from May 2024 to October 2025 New York lost 8 400 jobs in finance and more than 1 200 chain retail stores closed. While the data do not capture every corporate decision, they suggest that the losses are concentrated in high‑paying sectors that underpin the city’s tax base. Job growth since the pandemic has been skewed toward lower‑paid fields such as home healthcare and social assistance. Inflation‑adjusted private‑sector wages in New York fell 9 % between January 2020 and August 2025, whereas national wages rose 3 %.Not just the wealthy: the middle‑class exodusThe narrative of billionaires fleeing masks a broader challenge. Data from the same moving‑industry report reveal that households earning between US$51 000 and US$200 000 account for the largest number of departures from New York City. People making US$51 000–100 000 recorded 66 158 outflows, followed closely by the US$101 000–200 000 group with 62 209. In contrast, departures among high‑income residents fell after the 2025 primary election. The report also notes that 88 % of newcomers earn under US$200 000, signalling a shift toward a lower‑income demographic. Working‑class and middle‑income households cite rising housing costs and the cost of raising children as primary reasons for leaving.Research by an independent fiscal institute offers further nuance. After analysing eight years of migration records, the institute found that high earners typically move out of New York State at about one‑quarter the rate of other residents. The surge in wealthy departures during 2020 and 2021 was largely a temporary response to pandemic‑induced remote work. Migration rates for high earners returned to pre‑pandemic levels by 2022, and the state gained 17 500 millionaire households from 2020 through 2022 despite losing about 2 400. Statistical analysis showed no significant evidence that recent tax increases prompted high‑income migration; when affluent New Yorkers do move, they often choose other high‑tax states. Independent fact‑checkers note that working‑class New Yorkers, particularly Black and Hispanic residents and families with young children, leave at much higher rates than wealthy households.Policy debates and social costsDespite an improving population count, structural pressures remain. New York spends US$9 761 per resident on welfare and education—72 % more than Texas and 130 % more than Florida. Low‑income renters now devote 54 % of their income to rent, up from under 40 % in 1991; even a well‑paid professional must earn at least US$151 600 annually to ensure that rent on a studio consumes only 30 % of income. Without a rebound in finance or a dramatic housing boom, business leaders warn that New York could devolve into an “economically ordinary” US city, burdened by high rents and expanding welfare obligations.Political debates have sharpened these tensions. The 2025 mayoral frontrunner, Zohran Mamdani, proposes adding a two‑percentage‑point surcharge on incomes above US$1 million and raising the corporate income‑tax rate to 11.5 % to fund universal childcare and free buses. Experts point out that tax‑induced mobility among high earners is small: studies by Northwestern University, the EU Tax Observatory and the Fiscal Policy Institute indicate that wealthy households rarely move solely because of tax differentials. Nevertheless, policy analysts caution that imposing the nation’s highest marginal rates could gradually erode the tax base.Statistics from the Citizens Budget Commission show that more than 125 000 New Yorkers relocated to Florida between 2018 and 2022, carrying nearly US$14 billion in adjusted gross income. Such figures fuel both sides of the debate: proponents of higher taxes argue that migration flows are limited, while opponents warn that revenue losses could accelerate. The city’s 2025 “City of Yes” zoning reforms spurred construction of about 34 000 apartments in a single year, but housing supply remains tight. The interplay between taxes, housing costs and public services will determine whether New York regains its footing or continues to lose ground to lower‑cost competitors.A city at a crossroadsNew York’s appeal has always rested on its ability to offer unmatched cultural life, economic opportunity and diversity. The recent outflows of wealth, talent and businesses threaten this model. With millionaires comprising less than one percent of residents yet contributing nearly half of personal‑income tax revenue, the departure of even a few thousand people can blow a hole in public finances. The value proposition for middle‑income families is equally in jeopardy as housing and childcare costs soar. Meanwhile, the definancialisation of the local economy and the relocation of corporate headquarters erode the city’s job base. Taken together, these trends give credence to the image of a city that is “sinking” under the weight of its own costs.Yet the picture is not one of unrelenting decline. International migration, natural population growth and inbound investment continue to sustain New York. Surveys show that residents still value the city’s parks, cultural institutions and transit network despite concerns about safety and affordability. The challenge for policymakers is to balance progressive social aims with economic competitiveness: to improve public services and housing affordability while keeping tax rates and business costs from driving away the very people and companies who fund them.
Hidden Cartel crisis in USA
Organised crime in the Americas is dominated by drug‑trafficking cartels that have grown ever richer and more violent. Public debate often focuses on border security and cross‑border smuggling, yet there are deeper, largely unspoken dynamics that underpin the cartel problem. These include the international supply chain for synthetic drugs, sophisticated money‑laundering networks, cybercrime operations and the complicity of domestic gangs. Understanding these hidden dimensions is essential for any realistic attempt to stem the flow of drugs and violence.A lethal wave of synthetic drugsThe most pressing concern in the United States is the synthetic opioid fentanyl, which has become the deadliest drug in the country. In 2023 fentanyl‑related overdoses claimed around seventy‑five thousand lives and the economic cost of opioid deaths and addiction was estimated at about $2.7 trillion. A dose of two milligrams can kill an adult, and a single gram can be lethal to five hundred people. Despite increased seizures at ports and border crossings, the drug is usually trafficked in small consignments; the median fentanyl seizure in 2024 was just over a kilogram, but each packet holds tens of thousands of lethal doses.China banned the manufacture of fentanyl variants in 2019, but Chinese companies remain the primary suppliers of the precursor chemicals needed for fentanyl production. These substances are shipped from ports such as Hong Kong to Mexican ports like Lázaro Cárdenas and Manzanillo, where cartel groups collect them. Two Mexican organisations, the Sinaloa cartel and the Jalisco New Generation cartel, dominate the production of fentanyl for the U.S. market. U.S. law enforcement notes that four‑fifths of individuals arrested for fentanyl trafficking are American citizens, which underscores the domestic dimension of the crisis.Money laundering and Chinese networksCartels rely on complex financial operations to move billions of dollars in proceeds. Recent enforcement actions reveal a growing partnership between Mexican cartels and Chinese money‑laundering organisations. These brokers offer low commissions and anonymity through the use of social‑media apps and cryptocurrencies; they settle transactions via WeChat and blockchain without leaving paper trails, making it harder for authorities to interdict funds. Payments to Chinese companies for drug precursors have reportedly risen by roughly 600 percent between 2022 and 2023. Investigations show that a vast majority of Chinese precursor manufacturers accept cryptocurrency, mainly Bitcoin and Tron, and there has been a significant increase in the use of Ethereum for these payments.Chinese money‑laundering cells are typically small, family‑run operations that nonetheless handle enormous sums. They now provide services not only to Mexican cartels but also to European mafia groups. The cross‑border flow of funds is thus both global and decentralised, using technology to hide transactions from law enforcement. This reality challenges the common narrative that cartel profits are mainly funnelled through traditional banking systems.Corruption and heavy armsAnother overlooked element is the source of the cartels’ weaponry. It is widely assumed that American firearms fuel cartel violence, but much of the heavy arsenal used by cartels—machine guns, rocket‑propelled grenades and shoulder‑launched missiles—is not sold in U.S. gun shops. Intelligence experts report that these weapons are acquired through corruption in Mexico’s security forces. The diversion of military stockpiles in Mexico and Central America gives cartels access to war‑grade arms, amplifying their firepower while complicating efforts to demilitarise the conflict.Corruption also permeates government institutions. Former Mexican defence minister Salvador Cienfuegos and ex‑security chief Genaro García Luna were accused of aiding the Sinaloa cartel. This corruption allows cartels to operate with impunity, undermines public trust and complicates international cooperation. It also explains why direct military intervention by the United States is fraught with risks; any operation would have to distinguish between reliable partners and corrupt officials who may leak intelligence to the enemy.The rise of cyber‑cartelsBeyond drug smuggling and violence, cartels increasingly exploit digital technologies. Organised crime groups in Mexico have embraced cybercrime, buying malware kits and network access from the burgeoning “cybercrime‑as‑a‑service” marketplace. These so‑called cyber‑cartels use dark‑web markets and cryptocurrency to launder money and sell drugs anonymously. One group hacked banking systems to steal over $15 million, proving that cartels are no longer confined to street violence.The threat extends to personal security. Investigative reports describe how cartels access government intelligence platforms, such as a database that aggregates voter records, phone logs and credit‑bureau data. Cartels allegedly purchase this access on the black market, enabling them to geolocate rivals and disappear them without leaving traces. Such capabilities highlight the convergence of organised crime and cyber espionage, suggesting that cartel violence could be complemented by doxxing campaigns or attacks on critical infrastructure if provoked.Cartels and domestic gangsWithin the United States, the cartel problem is not restricted to border areas. Federal investigations reveal that transnational criminal organisations have formed alliances with domestic gangs. More than six thousand active gang investigations are under way, and there are roughly 6,000 cases targeting cartel leadership. Groups such as the 18th Street gang, the Mexican Mafia, the Bloods and the Crips partner with cartels to distribute drugs, launder money and carry out acts of violence. These partnerships underscore that the cartel business model relies on local networks for sales, enforcement and logistics, making it as much a domestic issue as an international one.Government responses and enduring challengesThe U.S. government has responded to cartel expansion with new institutions and sanctions. The formation of the Counter Cartel Coordination Centre and the creation of Homeland Security task forces have led to thousands of arrests and significant drug seizures. Financial sanctions, such as designating the La Línea organisation under anti‑narcotics authorities, aim to disrupt the revenue streams of violent cartels. Moreover, Washington has pressed Beijing to curb precursor exports; cooperation resumed in late 2023 after a period of diplomatic strain.Despite these efforts, experts caution that enforcement alone will not solve the crisis. Sustainable solutions require reducing domestic demand through addiction treatment and education, as well as investing in economic opportunities in Mexico to offer alternatives to the illicit economy. Without addressing root causes, a heavy‑handed approach risks sparking retaliation; cartels could use their cyber capabilities to sow panic or target critical infrastructure in response.Towards a nuanced understandingThe cartel problem no one talks about in the United States is not a single issue but an interlocking system. It begins with precursor chemicals shipped from East Asia, is financed through crypto‑laundered transactions and relies on corrupt officials and domestic gangs. Cartels have adapted to the digital age, developing cyber‑crime capabilities and exploiting government databases to intimidate rivals and undermine public trust. While American political debates often focus on building walls and militarising the border, the more difficult task is confronting the underlying networks that make cartels resilient.To address this hidden crisis, policy must extend beyond border security. It should encompass international cooperation to control chemical precursors, financial regulation to disrupt crypto‑based laundering, measures to root out corruption within security services and cyber‑security initiatives to prevent cartels from acquiring sensitive data. Above all, demand reduction through treatment and economic development both in the United States and Mexico remains indispensable. Recognising these unseen dimensions is the first step toward crafting a strategy that can stop the lethal tide of fentanyl and weaken the cartels’ hold on the hemisphere.
Argentina's radical Shift
Argentina is in the middle of a historic experiment. When libertarian economist Javier Milei took office on 10 December 2023, he inherited an economy gripped by triple‑digit inflation, a fiscal deficit equal to around 15 % of GDP, negative foreign‑exchange reserves and a country risk premium that made external financing almost impossible. Weekly price jumps were eroding purchasing power and nearly half of Argentines lived in poverty. In the 1990s a reform wave under President Carlos Menem introduced a currency board, privatized state companies and liberalised trade; those changes briefly stabilised prices but unravelled after persistent fiscal deficits led to a sovereign default in 2001. Milei argues that this earlier programme did not go far enough and has promised “the largest structural reform in Argentine history,” which he says is eight times larger than Menem’s and will transform the country into “the freest nation on the planet”.Shock Therapy and AusterityWithin days of taking office, Milei unleashed a package of policies that he called shock therapy. His finance minister devalued the peso by more than 50 %, set a crawling peg for the currency, halved the number of ministries and announced a fiscal adjustment of around 5 % of GDP. Government ministries were slashed from 18 to nine, thousands of public‑sector contracts were terminated and many public works projects were cancelled. A plan to shrink the state by roughly a third included closing state‑owned news agencies and eliminating subsidies for culture and the arts. Energy and transport subsidies — which had cost the treasury US$12 billion in 2022 — were cut sharply, while a tax amnesty was introduced to lure dollars stashed abroad back into the banking system. Import and export restrictions were lifted, price controls removed and the central bank stopped financing the treasury, ending a practice that economists blame for Argentina’s chronic inflation.The “chainsaw” approach shocked a society accustomed to state intervention. Public sector workers, construction employees and pensioners were hit hard. Tens of thousands lost their jobs or saw salaries and pensions lag behind prices. Construction activity collapsed after public works were frozen, costing an estimated 200,000 jobs, and austerity measures reduced funding for universities and hospitals. Unemployment and poverty surged in early 2024; some surveys reported poverty peaking at around 53 %. Milei acknowledged the pain but insisted that “there is no money” and that the alternative was hyperinflation.Early Results and Second‑Year ProgressThe shock therapy delivered results faster than many economists expected. After spiking briefly, monthly inflation plunged from roughly 25.5 % in December 2023 to 2.7 % by October 2024. Fiscal austerity and the elimination of money printing produced Argentina’s first budget surplus in more than a decade. By mid‑2024 the economy ran a trade surplus and improved its trade balance by more than US$18 billion, reflecting a decline in imports and an export boom driven by agricultural products and the Vaca Muerta shale field. Country‑risk indicators fell to their lowest levels in years, bonds rallied and the gap between official and parallel exchange rates narrowed sharply. A tax‑amnesty programme drew some US$19 billion back into the banking system, boosting reserves. Monthly inflation continued to fall into 2025, reaching around 2 %, a deceleration described by analysts as unprecedented.Second‑Year ProgressBy the middle of 2025 the government began to point to clear signs of economic turnaround. Output data show that GDP grew by 6.3 percent and investment by 32 percent year‑on‑year in the second quarter of 2025 after contracting early in Milei’s term. International institutions forecast overall growth of 4.7–5.5 percent for 2025. Annual inflation, which had reached 289 percent early in his administration, fell to 34 percent, equivalent to roughly 2 percent per month, and the poverty rate dropped from 53 percent to 32 percent, lifting more than 11 million people above the poverty line. Consumption and exports recovered, and employment started to grow.The administration attributes these gains to aggressive cuts and deregulation. It claims to have reduced the federal budget by 30 percent, balancing it by Milei’s second month in office. Public debt fell by about 12 percent, and the president vowed never again to run a deficit. A new ministry dedicated to deregulation abolished ten ministries, merged agencies and fired over 53,000 public employees. As of August 2025, the government had enacted 1,246 deregulations, roughly two per day, cutting red tape in energy, agriculture, real estate and health. The programme also repealed 22 taxes and reduced export duties, scrapped import licences and raised the limit on duty‑free purchases. These measures lowered prices for many goods — for example, home appliances fell 35 percent after import licences were abolished — and allowed livestock producers to import vaccines at a third of the previous cost. Rental deregulation tripled housing supply and cut real rents by around 30 percent, and mortgage lending has surged from a handful of loans in 2023 to a tripling of new mortgages in 2024. Together these changes are intended to create the freest economy in Argentina’s history.Milei used this momentum to claim that his government was “the best in history” and that his fiscal adjustment was the largest ever attempted. In an interview he declared that his administration had already executed a structural reform eight times larger than Menem’s and that his deregulation ministry was scrapping “between one and five regulations every day,” with more than 3,200 reforms still pending. The reforms have propelled Argentina up 90 places in an international economic‑freedom index, the president bragged, and he vowed to keep pushing until the country surpasses Ireland, Switzerland and New Zealand.Social Costs and Rising DissentDespite the improvement in macro indicators, the social consequences of Milei’s programme are severe. Real wages have fallen, and poverty, though down from its peak, still affects almost half of the population. Retirees have seen the real value of pensions eroded, with the average minimum pension hovering around US$300. Cuts to university budgets have left some campuses struggling to pay electricity bills. High interest rates — imposed to defend the peso — have frozen bank lending and provoked a steep drop in economic activity, especially in construction and manufacturing. Critics argue that opening the economy too quickly exposes local industries to cheap imports and risks deindustrialisation. Protests by pensioners, students and public‑sector unions have become more frequent, and opposition politicians warn that the recession will deepen if austerity continues unabated.Milei dismisses such criticisms as coming from the “political caste” he has vowed to defeat. He believes the temporary pain is a necessary price for eliminating structural distortions. To mitigate hardship, the government doubled the universal child allowance and increased food assistance, but for many households the support has not offset the effects of subsidy cuts and high inflation.Midterm Mandate and Reform BlitzArgentina’s October 2025 midterm elections turned into a referendum on Milei’s policies. The libertarian alliance La Libertad Avanza (LLA) captured more than 40 percent of the vote and more than doubled its share of seats in Congress. Preliminary results show the party winning 13 of the 24 Senate seats up for election and 64 of the 127 seats contested in the lower house, while the main Peronist coalition fell to second place. This landslide, combined with a turnout of 67.9 percent — the lowest since Argentina’s return to democracy — handed Milei the political capital he needs to advance reforms. Analysts say the midterm win “raised the prospect of structural change on a scale Argentina has not seen in decades”, and investors see it as a positive sign that a more market‑friendly Congress will back his agenda.U.S. support played an important role. In the weeks before the vote Washington offered a twenty‑billion‑dollar currency swap line and another twenty‑billion‑dollar loan facility to shore up Argentina’s reserves. After the election, analysts noted that U.S. backing of up to US$40 billion would encourage longer‑term investment in Argentine assets. Investors anticipate that Milei will now pursue sweeping labour and tax reforms that could unlock billions of dollars in foreign investment. Plans under discussion include simplifying the tax system, making labour contracts more flexible and reducing pension costs. A simplified tax regime, flexible labour laws and lower pension obligations are seen as prerequisites for Argentina’s competitiveness and will be key components of Milei’s “Pacto de Mayo” programme.The election also cemented investor confidence in the government’s Régimen de Incentivos para Grandes Inversiones (RIGI). Under this scheme, companies investing more than US$200 million receive 30‑year guarantees of legal and tax stability and a reduced corporate income tax of 25 percent, down from the standard 35 percent. Observers say the combination of a strengthened Congress and the RIGI regime will attract more foreign capital to mining, energy and infrastructure projects.International investors have taken note. Improved fiscal accounts and the promise of structural reform have attracted pledges of major investments. Energy companies have committed US$25–30 billion to build a liquefied natural gas terminal at Vaca Muerta, a project expected to create 50,000 jobs and generate US$300 billion in exports over two decades. Mining firms plan a US$15–17 billion copper and gold project in San Juan, described as the largest private investment in Argentine history. A technology consortium led by a U.S. artificial‑intelligence company has announced a US$25 billion data‑centre project in Patagonia. The United States has signalled support with a US$20 billion swap line and potential additional financing. Analysts believe that a simpler tax regime, flexible labour laws and lower pension costs could unlock billions in mining, energy and infrastructure investment.Yet Milei must still build alliances to turn proposals into law. Even after the midterms his party lacks a majority in both houses, and he needs support from centrist and provincial parties to enact reforms. Some lawmakers remain cautious; one Peronist congressman suggested the government must seek consensus rather than impose a programme unilaterally. Allies warn that fiscal discipline is non‑negotiable, but labour reforms could face resistance from unions and courts. Failure to build durable coalitions could stall the reform blitz and undermine investor confidence.Comparing with the 1990sThe last time Argentina attempted such sweeping changes was during the early 1990s. Hyperinflation in 1989–90 forced a political consensus for reform, and the government introduced a Convertibility Plan in 1991 that fixed the peso at par with the U.S. dollar and privatised most state enterprises. The package included trade liberalisation, tax reforms, and the replacement of the pay‑as‑you‑go pension system with private capitalisation. For a time the economy boomed and inflation collapsed, but the plan’s rigid exchange‑rate peg and lack of fiscal discipline eventually contributed to the devastating 2001 crisis. Milei argues that those reforms were incomplete and financed with debt. His programme goes further by eliminating monetary financing, balancing the budget, liberalising currency controls and aggressively deregulating markets. By claiming that his reforms are eight times more extensive than Menem’s, he positions his agenda as the largest structural change since the 1990s.Outlook: Promise and PerilMilei’s experiment has altered Argentina’s economic narrative. A year of aggressive austerity has stabilised inflation and restored fiscal discipline, leading to cautious optimism among investors. Massive energy, mining and technology projects could transform the export mix and relieve Argentina’s perennial foreign‑exchange constraint. Support from the United States and multilateral lenders provides a financial cushion while reforms take root. If labour, tax and pension bills pass, Argentina could enjoy a more competitive tax code, flexible labour market and sustainable social‑security system, changes that companies say are necessary for long‑term investment.But risks are substantial. Despite the fiscal surplus and lower inflation, Argentina remains in a deep recession; output fell 3.4 percent in the first half of 2025 and is expected to decline almost 4 percent for the year. Consumer demand has collapsed and unemployment has risen to about 8 percent, while nearly half of workers lack formal contracts and social security. Tens of thousands of public‑sector jobs have been cut, and many households now rely on multiple jobs because wages lag behind inflation. The peso remains overvalued: after an initial devaluation, the government has maintained a 2 percent per month crawling peg, causing the gap between the official and unofficial exchange rates to widen again. Import taxes of 17.5 percent and licensing requirements make trade unpredictable, and the administration plans to reduce the levy to 7.5 percent only gradually. These barriers, together with currency controls that limit citizens to changing US$200 of currency per month, continue to discourage investment and could prolong the recession.High interest rates and a strong peso threaten to squeeze exporters, while rapid import liberalisation risks deindustrialisation. Poverty remains high and social unrest could erupt if growth fails to materialise or if reforms are seen as benefiting only elites. Analysts warn that the currency remains vulnerable; mismanagement could reignite inflation or force a disorderly devaluation. Politically, Milei must shift from a confrontational approach to consensus‑building. Although the midterm strengthened his hand, he still lacks an outright majority and needs to negotiate with provincial governors and centrist lawmakers to pass labour, tax and pension bills. His ability to convert ambitious reforms into enduring state policy will determine whether Argentina’s new era becomes a sustainable success or another aborted experiment.
Al-Qaida’s growing ambitions
In recent years, Al‑Qaida has quietly restructured and expanded key elements of its network — from training camps and regional affiliates in Afghanistan and beyond, to renewed focus on propaganda and recruitment through modern communications. This resurgence, though still fragmented, increasingly suggests that Al-Qaida is laying groundwork not only for sporadic terror attacks, but for establishing durable footholds which could evolve into de facto zones of control — a development that should alarm European security institutions.Once seen as largely diminished with the removal of high-profile leadership, Al-Qaida has demonstrated remarkable resilience. Its decentralized “network of networks” model enables local affiliates and loosely connected cells to operate with considerable autonomy, while still drawing ideological coherence and logistical support from the core. This model lowers entry barriers for local militant groups inspired by its ideology — a subtle but potent evolution from the classic “top-down” terror organization.Moreover, Al-Qaida’s adoption of new technologies complicates detection. Terrorist actors increasingly rely on encrypted platforms, the dark web, and even generative-AI tools to recruit, radicalize and coordinate operations. This digital shift enables remote radicalization and planning, reducing the need for physical sanctuaries — but also masking activities from traditional intelligence and law-enforcement scrutiny.Regions of instability — such as parts of the Middle East, North Africa, and the Sahel — have become fertile ground for Al-Qaida’s expansion. These zones, often neglected in public discourse, now serve as incubators for networks that may aim to export influence, operatives, or refugees toward Europe. Historical experience shows that even small cells — when radicalized, organized, and motivated — can inflict damage beyond their geographical origins.For Europe, the threat lies not only in headline-grabbing terror attacks, but in the gradual erosion of security through infiltration, radicalization, sleeper-cells, and covert networks. Should Al-Qaida succeed in consolidating territories or safe havens, the challenge would shift from reactive counterterrorism to a strategic struggle over long-term stability.Now more than ever, European governments and institutions must treat Al-Qaida as a dynamic, evolving network — not a relic of the past. Proactive, coordinated efforts in intelligence-sharing, deradicalization, monitoring of migration flows, and disruption of online propaganda are crucial. Ignoring the signs of Al-Qaida’s silent reorganization would be a dangerous gamble: the consequences could redefine Europe’s security landscape for decades.
Saudi shift shakes Israel
Saudi Arabia has initiated a series of strategic decisions that are quietly but fundamentally altering the balance of power in the Middle East. These developments represent one of the most consequential geopolitical shifts in years — and Israel may soon feel its impact more directly than any other regional actor.Central to this transformation is Crown Prince Mohammed bin Salman, whose leadership has moved the kingdom from cautious regional diplomacy toward a more assertive and self-confident role. Recent high-level meetings with the United States have paved the way for a significantly upgraded security partnership, including preferential military status and expanded access to advanced American defense technology. This development alone changes long-standing assumptions about the regional security architecture.At the same time, Saudi Arabia’s long-discussed normalization with Israel remains theoretically possible — but under conditions that have changed dramatically. Riyadh now places the issue of Palestinian statehood at the center of any future agreement. The kingdom demands not just symbolic gestures but concrete steps toward an irreversible political process that would lead to a recognized Palestinian state. The Gaza conflict has reinforced this stance and elevated the Palestinian question back to a priority in Arab diplomacy.For Israel, this shift generates several strategic concerns:1. Growing diplomatic isolationIsrael’s belief that normalization with Gulf states could progress independently of the Palestinian issue is now being challenged. Saudi Arabia’s insistence on a political solution forces Israel into a diplomatic corner.2. Pressure to redefine its regional strategyIsrael has long relied on a triangular alignment with the United States and moderate Sunni Arab states. The new U.S.–Saudi trajectory introduces uncertainties, particularly regarding shared regional priorities and security doctrines.3. Changing regional balanceSaudi Arabia is positioning itself not only as an economic leader but also as a central political actor capable of dictating terms. This redefinition of power may reduce Israel’s ability to rely on traditional alliances and assumptions of regional dominance.4. Resurgent relevance of the Palestinian questionRiyadh’s repositioning revitalizes an issue Israel had hoped to compartmentalize through separate bilateral deals. Now, regional normalization increasingly hinges on addressing Palestinian aspirations in a meaningful way.Analysts warn that these changes are not temporary. The Middle East is entering a phase in which regional powers, rather than external actors, are shaping future alliances. Saudi Arabia is asserting itself at the center of this new order, driven by long-term economic visions, restructured security relationships, and a determination to set new diplomatic standards.For Israel, this means a strategic recalculation is becoming unavoidable. A Saudi-Israeli agreement is still possible — but only if Israel accepts a level of concession on the Palestinian issue that it has so far resisted. Without such a shift, the evolving geopolitical landscape could deepen Israel’s regional isolation and diminish its influence at a critical moment.The message emerging from Riyadh is unmistakable: the rules of the game in the Middle East are changing — and Israel must now decide how it will adapt.
BRICS-Dollar challenge
The BRICS countries are quietly mobilizing economic forces that could destabilize the US dollar’s long-standing dominance — at a time when the dollar appears increasingly vulnerable. Over the past months a clear shift has emerged: the grouping of major emerging economies is focusing on decreasing dollar dependency through bilateral trade in national currencies, while strengthening independent payment systems.Under its 2025 rotating presidency, one of the flagship initiatives is the expansion of BRICS PAY — a payment messaging platform designed to allow member states to settle transactions without using the dollar or traditional Western-dominated banking rails. This development signals a subtle, yet significant, attempt to reshape international trade and finance.Although plans for a single unified “BRICS currency” have been shelved for now — according to recent statements by officials from the presidency country — the strategic pivot toward local-currency settlements and alternative systems for cross-border payments remains very much alive. The goal appears to be less about instant replacement of the dollar, and more about gradual erosion of its monopoly.The motivations are manifold. Many BRICS governments view the dollar’s status not simply as an economic norm, but as a lever of political pressure. Given recent sanctions regimes, trade wars, and sharp swings in US fiscal and monetary policy, trusting a currency so tightly linked to US geopolitical decisions has become increasingly unpalatable. The emerging economies behind BRICS are leveraging their growing share of global trade, commodities, and population to assert greater independence — both economic and political.Analysts warn that while the dollar will likely remain dominant for the foreseeable future — due to its deep liquidity, global acceptance, and entrenched role in reserves and trade — the erosion of its role could have ripple effects. A sustained move by a major bloc of countries to settle trade in local currencies may gradually reduce demand for dollar-denominated reserves, alter global asset flows, and weaken the influence of US financial leverage.For countries and investors around the world, the underlying message is: the financial order may be entering a period of structural transition. While immediate displacement of the dollar seems unlikely, the steady developments within BRICS hint at a future where global transactions are more multipolar, diversified and less US-centric.In short: A large-scale challenge to the USD hegemony is being built not through bold proclamations, but through practical infrastructure and shifting economic habits — and its effects may unfold quietly, yet profoundly.
Trap laid, Ukraine walked in
The geopolitical landscape surrounding the war in Ukraine has shifted dramatically in recent weeks, leading many to argue that a trap was set — and Ukraine stepped straight into it. As pressure mounts around a new peace initiative promoted by former 45. and now 47. U.S. President Donald J. Trump, the debate is intensifying over whether Ukraine has been cornered and whether European nations share a shameful responsibility for the current predicament.The proposed peace framework circulating since late November presents a stark reality: Ukraine would be required to make painful territorial concessions, scale back parts of its military capabilities, and abandon long-term ambitions for deeper integration with Western defence structures. The rationale behind the proposal is packaged as a “pragmatic” path to ending the war, yet the implications would cement strategic gains for Russia and fundamentally weaken Ukraine’s sovereignty.European governments reacted with unease and internal division. Publicly, they emphasise the need for adjustments and caution against any agreement that reshapes borders under pressure. Privately, however, several capitals fear being left alone to shoulder long-term financial and military support should the United States pull back. Some European leaders recognise that approval of the plan could stabilise parts of the continent in the short term, yet at the cost of undermining the very principles they have defended since the war began.For Kyiv, the situation is even more delicate. Ukraine’s leadership has signalled willingness to examine the proposal, but throughout the country the sentiment is overwhelmingly hostile. Soldiers, civil society, and much of the population view the plan as nothing short of a surrender. After years of devastating losses, the idea of codifying territorial fragmentation and weakening national defence is seen as a direct threat to the nation’s survival.To many observers, the timing and structure of the proposal appear intentional. By presenting a plan that heavily favours Russian interests while portraying it as the “only realistic path forward,” Trump effectively places Ukraine under immense diplomatic pressure. If Kyiv rejects the plan, it risks losing political support; if it accepts, it risks losing the country it has fought to preserve.This dynamic also places Europe in an uncomfortable spotlight. While European nations have repeatedly voiced support for Ukraine, the reality is that they have long relied on U.S. leadership for strategic direction, intelligence coordination, and military supplies. Critics argue that Europe’s inability to develop a cohesive and independent defence posture has left Ukraine vulnerable to geopolitical gambits. Now, as the United States reshapes its stance, Europe must confront its shortcomings.The central question is no longer whether Ukraine wants to resist, but whether it still can — and whether Europe will meaningfully help. A peace agreement that weakens Ukraine risks redefining the security architecture of an entire continent, emboldening aggressive revisionism, and eroding confidence in the West’s commitment to defending democratic nations under threat.Whether this moment becomes the beginning of Ukraine’s political end or a turning point in Europe’s strategic awakening depends on the choices made now. What remains clear is that Ukraine cannot afford to be treated as a bargaining chip — and Europe cannot pretend that its own security is separate from Ukraine’s fate.