A plan for Haiti Massachusetts stuns Obama New rules for banks Dark days for lawyers and consultants JANUARY 23RD–29TH 2010 Economist.com The psychology of power Stop! The backlash against big government www.storemags.com & www.fantamag.com Njetj{fcvtjofttftbsfuif fohjoftpgbtnbsufsqmbofu/ Xfbsfmjwjohpobwfszejggfsfouqmbofugspnuifpofxf JCNboepvsCvtjofttQbsuofstbsfxpsljohxjui mjwfepofwfobgfxzfbstbhp/Upebz-bmnptubozuijohjo uipvtboetpgnjetj{fdpnqbojftbspvoeuifxpsme uifxpsmedbocfjotusvnfoufe-joufsdpoofdufeboenbef upcvjmebtnbsufsqmbofu/XfÖsfqspwjejohuifjotjhiut joufmmjhfouÒuiftztufnt-qspdfttftboeefwjdftuibu boeuppmtuifzoffeupxpslnpsfqspevdujwfmzboe fobcmfqiztjdbmhppetupcfefwfmpqfe-nbovgbduvsfe- qspßubcmzÒqpxfsgvm-bggpsebcmftpmvujpotuibudbo cpvhiuboetpme<tfswjdftupcfefmjwfsfe<boecjmmjpot ifmqdpnqbojftjnqspwffgßdjfodz-epnpsfxjuimftt- pgqfpqmfupcpuixpslboemjwf/Jotipsu-pvsqmbofujt bddfmfsbufSPJboetfj{fofxpqqpsuvojujftgbtufs/ cfdpnjohtnbsufs/ XfÖsfbqqmzjohpvsdpmmfdujwfefquiboecsfbeuipg fyqfsjfodfxpsljohxjuijoopwbupstpgbmmtj{ft-bdsptt Uijtjtqpttjcmf-jombshfqbsu-cfdbvtfuifjoopwbujpo fwfszjoevtusz-upbeesfttkvtubcpvuboztj{fqspcmfn- esjwjohbtnbsufsqmbofujtpsjhjobujohboeqspmjgfsbujoh ubtlpsxpslmpbe/ gspnnpsfwbsjfetpvsdftuibofwfscfgpsf/Jogbdu-xifo zpvmpplbubmmuifofxpqqpsuvojujftfnfshjoh-zpvnjhiu Btpvsqmbofucfdpnfttnbsufs-njetj{fcvtjofttft uijoluibuuifzpomzbqqmzupmbshfsfoufsqsjtft/Cvu xjmmxjfmenpsfpguifjoàvfodfuibupodfcfmpohfeup josfbmjuz-njetj{fdpnqbojftibwfcffouiffohjoft pomzuifmbshftufoufsqsjtftÒ boeJCNboepvsCvtjoftt esjwjohfdpopnjdhspxuiboebtnbsufsqmbofugpstpnf Qbsuofstbsfqspwjejohuiftvqqpsuboelopx.ipx ujnfopx/ upifmquvsouifjswjtjpojoupsfbmjuzboeuifjsjefbt joupsftvmut/ Njetj{fboetnbmmfsdpnqbojftsfqsftfounpsfuibo:1& pgbmmcvtjofttftboefnqmpzpwfs:1&pguifxpsmeÖt Njetj{fcvtjofttftbsfuiffohjoftpgbtnbsufsqmbofu/ xpslgpsdf/UifzÖsfsftqpotjcmfgpsdmptfup76&pghmpcbm TffuifdpnqbojftJCNboepvsCvtjofttQbsuofst HEQ/Uifzqspevdfnpsfqbufoutboenpsfjoopwbujpot bsfxpsljohxjuibujcn/dpn0fohjoft2/MfuÖtcvjmeb qfsfnqmpzffuibombshfßsnt/ tnbsufsqmbofu/ JCN-uifJCNmphp-jcn/dpn-TnbsufsQmbofuboeuifqmbofujdpobsfusbefnbsltpgJoufsobujpobmCvtjofttNbdijoftDpsq/-sfhjtufsfejonbozkvsjtejdujpotxpsmexjef/Puifsqspevduboetfswjdfobnft njhiucfusbefnbsltpgJCNpspuifsdpnqbojft/BdvssfoumjtupgJCNusbefnbsltjtbwbjmbcmfpouifXfcbuxxx/jcn/dpn0mfhbm0dpqzusbef/tiunm/ªJoufsobujpobmCvtjofttNbdijoftDpsqpsbujpo3121/ www.storemags.com & www.fantamag.com www.storemags.com & www.fantamag.com Contents The Economist January 23rd 2010 5 8 The world this week 37 New president in Honduras Lobo alone Leaders 38 Brazil’s presidential 11 Big government biopic Stop! Lula, sanitised 12 The Massachusetts 38 A Canadian election misunderstanding The man who fell to earth Just history 13 Sri Lanka’s presidential election Asia Between a rock and a hard Massachusetts After the man 39 The war in Afghanistan Democrats’ stunning loss, Bombs and baksheesh Barack Obama has no choice 13 After the earthquake but to move back to the centre: A plan for Haiti 40 Pakistan’s vulnerable On the cover president leader, page 12. How Scott The size and power of the 14 Reforming banks In disrepute Brown swept up the Bay State The weakest links state is growing, and 40 Sri Lanka’s Tamil and stymied health reform in discontent is on the rise: 15 Ukraine’s presidential diaspora Washington, DC, page 27 leader, page 11. The return election Next year in Jana of big government means An orange and two lemons 41 Political scandals in that policymakers must Japan grapple again with some Letters basic questions. They are Ozawa at bay now even harder to answer, 16 On Pakistan, water, 41 China’s assertiveness pages 23-26 bankers, housing, Choppy waters Socrates, global warming, 42 Protest in Hong Kong e-readers On track for confrontation 43 Banyan Brieng Indonesia’s books of Daily news and views: news 23 The growth of the state slaughter and forgetting analysis, online-only columns, Leviathan stirs again blogs on politics, economics and Haiti The government cannot travel, and a correspondent’s Middle East and Africa rebuild the country. A diary United States 44 Israel and Palestine temporary authority needs to be set up to do so: leader, page E-mail: newsletters and 27 The Massachusetts Do get talking again mobile edition shocker 45 Israel’s prime minister 13. The world’s attempt to aid Economist.com/email The unstoppable truck The media get at his wife Haitians stumbles against extraordinary diculties of Research: search articles since 28 Health reform 45 The Muslim Brothers transport and communication, 1997, special reports Rip it up and start again Whither its new leader? Economist.com/research page 35. Insuring against 29 The housing market 46 Ethiopia’s election disaster, page 73 Print edition: available online Still in the cellar Jangling nerves by 7pm London time each Thursday 29 Reforming West Virginia’s Economist.com/print legal system Europe Small steps Audio edition: available online to 47 Ukraine’s election download each Friday. 30 California’s Central Valley Economist.com/audioedition Five years on in Kiev The Appalachia of the West 49 Germany’s government 32 Antitrust law and football Waiting for Angela Out of many, one? 50 Sweden leans left again 32 Pets in the recession Trouble at home Howls for help 50 The Irish economy Volume 394 Number 8666 33 Lexington Green shoots The fat plateau First published in September 1843 51 Greece’s public nances Ukraine Whoever ends up to take part in "a severe contest between Pull the other one intelligence, which presses forward, and leading the country needs an unworthy, timid ignorance obstructing The Americas 52 Charlemagne encouragement from the our progress." 35 Chaos in Haiti Europe and China European Union: leader, page Editorial oces in London and also: A massive relief eort 15. The presidential election Bangkok, Beijing, Berlin, Brussels, Cairo, Chicago, Delhi, Frankfurt, Hong Kong, limps into gear shows that the orange Jerusalem, Johannesburg, Los Angeles, 36 Lessons from the tsunami revolution is out of pu, no Mexico City, Moscow, New York, Paris, matter who eventually wins, San Francisco, São Paulo, Tokyo, Washington Too much of a good thing? 37 Chile’s presidential page 47 election Piñera promises a gallop 1 Contents continues overleaf www.storemags.com & www.fantamag.com 6 Contents The Economist January 23rd 2010 Britain 72 Europe’s co-operatives Mutual respect 53 Manufacturing blues Another one bites the dust 73 Exchange-traded funds Trillion-dollar babies 54 The return of ination A bungee-jump 73 Catastrophe insurance When calamity strikes 55 Defence-spending cuts You can’t ght in here, this 74 Economics focus is the war room Investment in Asia International Science and technology Base camp Basel New rules Next week 57 Spending on education 75 The psychology of power will make the average bank We publish a special report Investing in brains Absolutely safer. But what about the on online social networks. 58 Schools in poor countries 76 Glaciers and the IPCC outliers? Leader, page 14. O-base camp They are changing the way Regulators are trying to make Reaching the neediest people communicate, work Railways and slime moulds banks better equipped to deal 77 and play, and mostly for the A life of slime with catastrophe, pages 66-68. Business better, says Martin Giles A new round of results, page 70 61 America’s car industry Small cars, big question Books and arts 78 War in Georgia Principal commercial oces: 62 Renault and meddling 25 St James’s Street, London sw1a 1hg politicians Ungodly suering Tel: 020 7830 7000 Fax: 020 7839 2968/9 Attempted carjack 79 Mahathir Mohamad 6 rue Paul Baudry, 75008 Paris, France Tel: +33 153 936 600 Fax: +33 153 936 603 62 The business of What the doctor ordered 79 The music of Carlo 111West 57th Street, New York NY10019 dissecting electronics Tel 1212 5410500 Fax 1212 5419378 The lowdown on teardowns Gesualdo Lurid rhythms 60/F Central Plaza 63 Shenzhen’s fading spirit 18 Harbour Road, Wanchai, Hong Kong of enterprise 80 The European Union Tel 852 2585 3888 Fax 852 2802 7638 No longer so special What is it for? Other commercial oces: 80 Henning Mankell Chicago, Frankfurt, Los Angeles, 64 Professional-services San Francisco and Singapore rms Chewing the fat Lawyers and consultants The Laid-o lawyers, cast-o downturn is sorting the best 81 Indian contemporary art consultants professional-services rms Public notices Subscription service from the rest, page 64. The 65 Schumpeter 81 The Royal Society For our latest subscription offers, visit Consultants in the public Like-minded fellows Economist.com/offers public sector has had its ll of For subscription service, please contact by management consultants: sector telephone, fax, web or mail at the details Schumpeter, page 65 provided below: Obituary Telephone: 1 800 456 6086 (from outside Brieng the US and Canada, 1 314 447 8091) 82 Jyoti Basu Facsimile: 1 866 856 8075 (from outside 66 Reforming banking India’s almost-prime the US and Canada, 1 314 447 8065) Base camp Basel minister Web: Economistsubs.com E-mail: [email protected] Post: The Economist Subscription Services, P.O. 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