America's Extraordinary Economic Gamble
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The ascent of Elon Musk Germany’s miserable coalition Winter Olympics: slope-a-dope Guerrilla drones FEBRUARY 10TH–16TH 2018 Running hot America’s extraordinary economic gamble Only 1 in 10 organizations can deliver all of their strategic initiatives successfully! See what Leaders are doing at www.brightline.org/eiu-report Strategy has little value until it is implemented. In a world where disruption can happen overnight, moving rapidly from strategy design to delivery is critical. To understand why many organizations fail to bridge the gap between strategy design and delivery, Brightline Initiative commissioned The Economist Intelligence Unit (EIU) to conduct a global multi-sector survey of 500 senior executives from companies with annual revenues of $1 billion or more. Contents The Economist February 10th 2018 5 8 The world this week United States 33 The economy Leaders The great experiment 11 America’s economy 35 Politics and the FBI Running hot Against the law 12 Germany 35 Wildfire and fraud Reheating the GroKo Insult to injury 12 Philanthropy 36 Politics in South Dakota The billionaires and the Plains speaking Falcon Heavy 37 The Great Lakes German politics A new 13 Telecoms Mind-bending stuff government at long last. Next-generation thinking 38 Lexington Honest Injun Unfortunately, it will look very 14 Drugs in sport like the old one: leader, page On the cover Dope on the slopes 12. Germany’s main parties America is about to test the The Americas conclude a coalition deal, merits of running an economy Letters 39 Venezuala page 48 hot. Expect more bumpy 16 On Honduras, Italy, tech Lights out for democracy weeks: leader, page 11. The companies, walking, The 40 Ontario decision to stimulate an Darkness Double-wage trouble already pacy economy is less illogical than it seems, page 40 Americans in Mexico 33. After a long period of Briefing Trump supporters welcome calm, investors get a shock, 19 Elon Musk’s futures 42 Bello page 63. Recent market The impact investor Political decay ructions highlight the role of instruments that bet against 22 The Boring Company Middle East and Africa volatility, page 64. Central Tunnel vision banks must occasionally 43 Egypt’s economy gamble that faster Asia The price is wrong productivity growth is 25 Insurgency in the 44 Israel and its neighbours Egypt What fuel, bread and possible: Free exchange, Philippines The guns of February water reveal about how the page 68 Peace without dignity 45 Saudi Arabia’s nukes country is mismanaged, page 43 26 Digital spin in Asia An unenriching debate #TechSavvyPols 45 Ethiopia’s new railway The Economist online 26 Politics in Bangladesh Danger, camels crossing Daily analysis and opinion to Condemned 46 Africa’s energy drink supplement the print edition, plus Bacchus goes bananas audio and video, and a daily chart 27 Gangs in New Zealand Economist.com Bigger than the army 46 South African politics Long waltz to freedom E-mail: newsletters and 28 The Winter Olympics mobile edition Frosty South Koreans Economist.com/email 28 Bathing in Japan Europe Print edition: available online by Ink stink 47 Spanish politics 7pm London time each Thursday 30 Banyan Ciudadanos on the march Economist.com/printedition A tempest in the Maldives 48 The Berlin Wall Sports doping Performance- Audio edition: available online Still healing enhancing drugs are still to download each Friday China 48 Germany rampant in sports. There are Economist.com/audioedition A loveless marriage ways to reduce their use: 31 Population policy leader, page 14. Why no one Gilding the cradle 49 French education seems to want to do so, page 55 32 Hong Kong’s democrats Back to bac Three men and a vote 49 Russia’s opposition The approved challenger Volume 426 Number 9078 50 Romania Nobbling the nobblers Published since September 1843 to take part in "a severe contest between 51 Charlemagne intelligence, which presses forward, and History wars an unworthy, timid ignorance obstructing our progress." Editorial offices in London and also: Beijing, Berlin, Brussels, Cairo, Chicago, Madrid, Mexico City, Moscow, Mumbai, Nairobi, New Delhi, New York, Paris, San Francisco, São Paulo, Seoul, Shanghai, Singapore, Tokyo, Washington DC 1 Contents continues overleaf 6 Contents The Economist February 10th 2018 Britain Science and technology 52 The politics of trade deals 70 Guerrilla drones Not so global Britain Buzz, buzz, you’re dead 53 Brexit, trade and the EU 71 Fossil spiders The wheat and the chaff When doctors disagree 54 Bagehot 72 Diet and health Meritocracy and its Bitter fruits discontents 72 Satellite prospecting Lithium in Cornwall International 73 Amelia Earhart The ambition of Elon Musk French culture wars 55 Doping in sport Mystery solved? He is trying to change more Emmanuel Macron’s bid to Whatever it takes worlds than one. Despite his enlarge French culture has gifts, failure is most definitely Books and arts caused controversy—and not an option, page 19. The mega- Business 74 French culture wars as he might have expected, rich have grand plans to shape 57 Mobile telecoms The river and the sea page 74 humanity’s future. Should that The forces of 5G 75 A chilling Russian film be a cause for celebration or 58 Samsung Only disconnect concern? Leader, page 12 Subscription service Get out of jail free 76 Border patrol For our full range of subscription offers, Walking the line including digital only or print and digital 59 Airbus combined visit Changing the pilots 76 New American fiction Economist.com/offers Divas in New York You can subscribe or renew your subscription 60 Mining in Congo by mail, telephone or fax at the details below: They don’t dig it 77 The war in Afghanistan Telephone: +65 6534 5166 Digging a hole in the Facsimile: +65 6534 5066 60 The unwinding of HNA Web: Economist.com/offers Flight of fancy ocean E-mail: [email protected] Post: The Economist 61 Industrial property Subscription Centre, Bigger in Nevada 80 Economic and financial Tanjong Pagar Post Office 62 Schumpeter indicators PO Box 671 Singapore 910817 Tata’s next chapter Statistics on 42 economies, plus our monthly poll of Subscription for 1 year (51 issues)Print only Australia A$465 forecasters China CNY 2,300 5G Building a single, shared Finance and economics Hong Kong & Macau HK$2,300 wireless network is not such a India 10,000 63 Markets Japan Yen 44,300 stupid idea: leader, page 13. Obituary Boo! Korea KRW 375,000 Whizzy wireless technology 82 Ingvar Kamprad Malaysia RM 780 64 Betting on volatility New Zealand NZ$530 has everything going for Self-made man Singapore & Brunei S$425 it—except a strong business Vexed about Vix Taiwan NT$9,000 Thailand US$300 case, page 57 64 Digital currencies Other countries Contact us as above Crypto-correction 65 Buttonwood Principal commercial offices: Index-tracking The Adelphi Building, 1-11John Adam Street, 66 Insider trading London WC2N 6HT In the know Tel: +44 (0) 20 7830 7000 Rue de l’Athénée 32 67 Wells Fargo 1206 Geneva, Switzerland If the cap fits Tel: +4122 566 2470 67 South-to-South 750 3rd Avenue, 5th Floor, New York, NY 10017 investment Tel: +1212 5410500 Developing ties 1301Cityplaza Four, 12 Taikoo Wan Road, Taikoo Shing, Hong Kong 68 Free exchange Tel: +852 2585 3888 Central banks and Guerrilla drones Home-made productivity Other commercial offices: and home-modified drones are Chicago, Dubai, Frankfurt, Los Angeles, now a threat to conventional Paris, San Francisco and Singapore armies and navies, page 70 PEFC certified This copy of The Economist is printed on paper sourced from sustainably managed forests, recycled and controlled sources certified by PEFC PEFC/01-31-162 www.pefc.org © 2018 The Economist Newspaper Limited. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of The Economist Newspaper Limited. Published every week, except for a year-end double issue, by The Economist Newspaper Limited. The Economist is a registered trademark of The Economist Newspaper Limited. Publisher: The Economist. Printed by Times Printers (in Singapore). M.C.I. (P) No.057/09/2017 PPS 677/11/2012(022861) Is there still opportunity in China? Where will growth come from? As China moves beyond manufacturing and be- comes a leader in innovation, it creates new oppor- tunities. And new risks. Identifying the businesses How would it affect my investments? and technologies that will flourish, isn’t easy. With the local knowledge and insights we’ve built from being the first foreign bank in China, backed by our global resources and expertise, we help you invest wisely in a market with huge potential. For some of life’s questions, you’re not alone. Together we can find an answer. © UBS 2018. 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