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China has Stepped In as World’s New Bank

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Photo Credit: Bloomberg View Thanks to China, Christine Lagarde of the International Monetary Fund, Jim Yong Kim of the World Bank and Takehiko Nakao of the Asian Development Bank may no longer have much meaningful work to do.

Beijing’s move to bail out Russia, on top of its recent aid for Venezuela and Argentina, signals the death of the post-war Bretton Woods world. It’s also marks the beginning of the end for America’s linchpin role in the global economy and Japan’s influence in Asia.

What is China’s new Asian Infrastructure Investment Bank if not an ADB killer? If Japan, ADB’s main benefactor, won’t share the presidency with Asian peers, Beijing will just use its deep pockets to overpower it. Lagarde’s and Kim’s shops also are looking at a future in which crisis-wracked governments call Beijing before Washington.

China stepping up its role as lender of last resort upends an economic development game that’s been decades in the making. The IMF, World Bank and ADB are bloated, change-adverse institutions. When Ukraine received a $17 billion IMF-led bailout this year it was about shoring up a geopolitically important economy, not geopolitical blackmail.

Chinese President Xi Jinping’s government doesn’t care about upgrading economies, the health of tax regimes or central bank reserves. It cares about loyalty. The quid pro quo: For our generous assistance we expect your full support on everything from Taiwan to territorial disputes to deadening the West’s pesky focus on human rights. (Read more about the world’s new bank HERE)

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Public Sector Unions Are Very Different From Private Sector Unions

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Photo Credit: Washington Examiner A strike in Chicago and New York City; rallies of tens of thousands in Wisconsin; politician walkouts in Indiana; attempts to change the constitution in Michigan — these events and more featured government unions and their leaders at the forefront of the recent battles over public policy.

As a recessed economy dragged down state expenditures, governors and legislatures increasingly looked to trim from the fattest part of government: Public-sector employees. Salaries and pensions that saw government workers being compensated far more generously than their private-sector counterparts were finally beginning to be addressed.

While it would be easy to classify this battle as between those who are “pro-union” or “anti-union,” a distinction should be made between unions in the private-sector versus the public-sector counterpart. Historically and in modern-day practice, these are two very different things.

Under the National Labor Relations Act, private-sector unions are allowed to extract dues and fees from workers if the employer is a unionized workplace. The NLRA, passed in 1935 during Franklin D. Roosevelt’s first term, does not, however, apply to public-sector employees, including state and federal workers, because the thinking was that this would over-politicize government and cause a conflict of interest between unions and politicians.

Read more from this story HERE.

Cyberattacks: Major Iranian Threat

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NEW YORK (CNNMoney) — Iran’s quest for a nuclear weapon has been the subject of much debate this election season, but the presidential candidates rarely discuss the most imminent danger Iran poses to the United States: cyberwarfare.

Iran is believed to be behind a slew of massive attacks in September that took down a string of U.S. banks’ websites. The country is also thought to have launched a devastating cyber time bomb on Saudi Oil company Aramco in August and to have coordinated a similar attack on Qatar’s RasGas, an Exxon Mobil (XOM, Fortune 500) subsidiary.

The bank attacks were 10 to 20 times bigger than a typical denial of service attack, and doubled the previous record for traffic maliciously directed at a particular site, according to CrowdStrike, a security firm that investigated the attacks. The Aramco attack, set to go off on an Islamic holy night, unleashed a virus that destroyed about 30,000 corporate computers — three-quarters of the company’s PCs.

It’s a show of muscle the United States and its allies are unaccustomed to seeing from Iran. Cyberespionage and online identity theft are common tactics of Russian mafiosos and Chinese hackers, but Iran is relatively new to this playing field. After a series of painful economic sanctions levied on the country by the United States and Europe, cybersecurity experts say they’re not surprised that Iran is fighting back.

“Iran is trying to demonstrate that it has a capability to disrupt life in the West,” said Roger Cressey, senior vice president at security consultancy Booz Allen Hamilton. “Its argument is: ‘Whatever you in the West may do to us, know that it will not be a pain-free operation.'”

Read more from this story HERE.