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Peace Talks in Wartime Are Tough: Why Do They Begin So Late in Battle?

Fighting for the peace in the 1949 (1)
Fighting for the peace in the 1499 Swabian War (left) and negotiating for the peace at the end of that war (right).Public Domain[i]

By Joseph Mazur 

The only way wars end is either by mutual agreement or by overwhelming death and destruction.

We no longer live in an age of tribal isolation. Our global connections call for skilled leaders to get us through years of wars that have ultimately become mutual agreements of how much death and destruction is affordable. The countless challenging problems we face can be solved only by alliances and partnerships in recognition of conflicting governmental systems. Belligerencies between and within states may be how the world works, but they also damage the essentials of keeping the planet alive. With so many think tanks focusing on military and war-negotiating government strategies, why do we not have the intelligence to know how to stop wars before they start? And why do our long wars so often continue in battle without significant negotiations for peace? Without serious offers at balanced peace tables, wars, deaths, and destruction will continue serving no one.

War appears to be, or threatens to be, not so much a contest of strength as one of endurance, nerve, obstinacy, and pain. It appears to be and threatens to be, not so much a contest of military strength as a bargaining process dirty, extortionate, and often quite reluctant bargaining on one side or both nevertheless a bargaining process. – Thomas Crombie Schelling[2]

How can two enemy countries find ways to follow their opposing governmental systems and still find their ways to peace? When negotiations work, they tend to do so at a cost far lower than war. Going back in the history of civilization, we learn that more wars are stopped than started because there were influential people, diplomats, ambassadors, religious and nongovernmental leaders wise enough to counterbalance difficult belligerencies through intelligent negotiations. The Punic Wars (Rome vs. Carthage) had a de jure (legally recognized) duration that continued for two millennia and were finally settled in 1985 by the smart mayors of modern Rome and the Municipality of Carthage, who signed a peace treaty and accompanying pact of friendship.[3] Yay! And wow! Finally, reconciliation! The two cities are officially making peace through the sensibility of a symbolic end.

Stopping a war faces gusts of arms-dealing headwinds; sometimes the diplomacy battle must be stronger than the war itself because, as I pointed out in my WFR article “Why Are There So Many Wars, Especially Now? An Obscure Brilliance of Arms Dealing Keeps Wars Coming”, that arms production, sales, and trade rise to sustain wars that go well for one side or another.[4] The people and companies that benefit from wars – the arms dealers, manufacturers, politicians, and public investors – are the tempests battling negotiations. Wars happen and continue for longer periods than planned, partly because of a profitable weapons industry supported by powerful influence.

The wars in Vietnam, Afghanistan, and Iraq did not go as planned. Deaths and injuries were higher than war planners approximated as “worth it” numbers. Some weapons then were mostly conventional, yet sophisticated and available from terrorist states and black markets. More than 3.1 million civilians and fighters were killed in the Vietnam War. But the number of casualties in subsequent wars (in Afghanistan and Iraq) is far smaller, though more difficult to estimate. From 1964 to 1968, Vietnam War diplomacy was a cycle of discussions about adding another round of endless talks. The first secret talks between the United States and North Vietnam began in 1968, with no agreements before 1973. Diplomatic intent was the veneer of meetings for peace, mostly talking about talking. President Lyndon Johnson told reporters at a press conference in 1965, “We are ready now, as we have always been, to move from the battlefield to the conference table. I have stated publicly many times, again and again, America’s willingness to begin unconditional discussions with any government, at any place, at any time. Fifteen efforts have been made to start these discussions with the help of 40 nations throughout the world, but there has been no answer.”[5] Regrettably, Hanoi and the U.S. could not agree on the plans of peace talks, so neither side was willing to bargain. Even at that preliminary stage, as brutal fighting continued, the “battle of the tables” was world news for ten weeks; the delegates on both sides could not agree on how the meeting would be held, the shape of the conference table, whether there would be more than one table and, if so, where they should be. After weeks of deliberation between round and triangular, the shape became circular.

The Afghanistan war went on for 17 years before any serious negotiations were in place. Sure, there were on-and-off negotiations in peace deals all that time, and meetings to amplify agendas for more meetings. But it was not before 2018 that serious high-level talks began when the U.S. offered a ceasefire and a withdrawal of troops in exchange for Taliban commitments to block international terrorist groups from operating in Afghanistan. After the U.S. announced an agreement with the Taliban, who were committed to the agreement, just six months after being inaugurated, President Trump abruptly called off the peace talks.[6] Finally, on February 29, 2020, an agreement for bringing peace to Afghanistan was signed to give “guarantees and enforcement mechanisms that will prevent the use of the soil of Afghanistan by any group or individual against the security of the United States and its allies,” with a commitment to a later-date negotiation for a ceasefire.[7]

One should ask why a modern war should go on for almost two decades without much interest in peace negotiations. One must question: How can military conflicts continue without the peace-table arguments behind the reasons for combat? Even families know that their disputes are better handled by conflict-resolution therapy. I am going all out to answer. As I pointed out in my TWFR article “Why Are There So Many Wars, Especially Now?”, wars happen partly because of a profitable weapons industry supported by powerful influence. More than ever, “battlefield performance is a sales convention where weapons are on display.” [8]

These days, weapons can be bought wholesale from dealers and terrorist states. Drones are made and sold by unlicensed civilians who manufacture their goods in hidden garages. The collapse of the Soviet Union left only one superpower in charge of the limited conflicts between small coalitions of states and non-states. The sudden rise of terrorism shortly before and after 9/11 brought us the “war on terror” that built shadow wars with almost no diplomatic contact between enemies. Major wars were about terrorism, not entirely about territory expansions or regional influence, though some were surely about ideologies and political theater.

Then came Russia’s invasion of Ukraine, dramatically reshaping global foreign affairs by limiting direct negotiations for peace and inspiring Iran to support the Hamas terror attack on Israel, which in turn brought on the massive reaction loops of destructive revenge and thereby broadened the reprisals between multiple states and non-state combatants. WWI brought collaborations between countries with serious intentions for peace, not tight alliances for wars. In the Soviet Union days, the world took solace in knowing there was a hotline between the nuclear superpowers; two of the most powerful leaders, we believed, were rational enough to agree on a diplomatic solution to save the world from its most feared ending. My most optimistic senses tell me that that old hotline still exists – as it did during the 1962 Cuban missile crisis – but I have no confidence that the folks on the line now care about anything other than themselves (especially now that Donald Trump is the U.S. President-Elect). Though I hope the hotline is real, it stands metaphorically as an exit to the risk of spiraling conflicts, a de-escalating trigger that keeps each side of a conflict from crossing dangerous brinks.

Letter from Nikita Khrushchev to John F. Kennedy in 1962
Public Domain

Are wars avoided through negotiations of appeasement?

Wars of the past were more problematic than those happening now. Think of WWII, when Hitler, following diplomatic rules when they suited him, signed treaties and heedlessly broke them. These days, treaties are bargained through the United Nations, which has charge of the International Criminal Court and the International Court of Justice. When the British Prime Minister, Neville Chamberlain, signed an agreement that permitted Germany to annex the Sudetenland part of Czechoslovakia, that too was diplomacy but leaning on capitulation. Comparing Hitler’s Fall Grün (Case Green – the Nazi Party plan to invade Czechoslovakia) with Putin’s Special Military Operation, we find remarkably tight similarities. Fall Grün was partly an excuse for war, starting with an invasion of the Sudetenland, a portion of Western Czechoslovakia with close to three million inhabitants, many of whom spoke German or were of German descent, some following Konrad Henlein, a Sudeten-German, who organized the Sudeten-German Home Front that called for the German annexation of Czechoslovakia.

German Federation Archives Bild 146-1970-052-24
Creative Commons Attribution ShareAlike 3.0 (Generic)
Benito Mussolini, Adolf Hitler, Paul Schmidt (Liaison interpreter), Neville Chamberlain at the 1938 Munich Agreement.

Putin’s “Special Military Operation” excuse centered on freeing Russian inhabitants in Crimea, who were Russian organizers and agitators planted in eastern Ukraine to disrupt political activities. An emergency diplomacy meeting of representatives in Munich went well for Hitler. Sudetenland, a mountainous natural defense borderland for Czechoslovakia’s protection against the Germanic States, was given to Germany by a capitulating agreement signed by France, Britain, and Germany.  

Figure 1: 

Czechoslovakia 1930: linguistic map.
Blue represents German-speaking communities.
Source: Wikimedia Commons. Author: Henry Mühlpfordt / Czechoslovakia 1930 linguistic map – en.jpg Mariusz Pazdziora

Sudetenland was Czechoslovakia’s protection against Germany, comparable to what would later become the Soviet Union’s protective border, the Eastern Bloc countries of Europe that were aligned strategically, economically, militarily, and politically with the Soviet Union before its collapse. It also compares with smaller reasons for the Russian invasion of Ukraine to rebuild the Eastern Bloc. 

It is well-known history that tells us that Chamberlain believed that war would be avoided if Czechoslovakia’s Sudeten geographical block were transferred to Germany. For Hitler, it was a gain, under the optimistic belief that war would be avoided if Germany’s condition of bringing ethnic Germans back to German dominion would appease the Third Reich. Some of the most expert critics of the “Chamberlain Appeasement,” including Churchill, argued that WWII could have been avoided had Britain prevented the German buildup of armaments in 1936.

Laying the blame for World War Two goes back to World War One.

Few wars are won only by a total defeat of one side. Most end with diplomatic packages ordering ceasefires, armistices, or overwhelming political fatigue. Others, excluding internal hot ones after WWII, have ended in ceasefires or backing out. In the last three decades, there were at least “2,202 ceasefires across 66 countries in 109 civil conflicts involving 4,091 declarations by 469 different governments and non-state armed groups” arranged through unilateral, bilateral, and multilateral agreements.[9] It follows that diplomacy can play a role in preventing wars. Ceasefires, though, do not always hold for long, because the end of one war connects to reasons for another. WWII had links to WWI. The Korean and Vietnam Wars both have tentacles stretching from WWII. Wars are not simple. They are not easily stoppable, even with the best intentions on both sides. World War II never seriously negotiated a settlement less than unconditional surrender, partly because everyone involved knew that Hitler could not be trusted.

A.J.P. Taylor, a British historian, journalist, and broadcaster to millions through his television lectures, was a specialist in European diplomacy. In his book The Origins of the Second World War, published in 1961, he wrote that diplomatic mistakes on both sides caused WWII to explode the way it did. Most modern historians differ from Taylor’s reasoning, which downplays Hitler’s antisemitism and Nazi ideology while putting some blame on the Allied powers. In Taylor’s view, the war would have ended differently had America not intervened; that is certainly true. The problem, the way some historians saw it, along with Taylor, was the U.S. policy of permission for Hitler to rearm and build a successful propaganda machine that took in luminaries such as Charles Lindbergh and many Berlin-paid Nazis in the U.S. Congress (see Rachel Maddow’s podcast Ultra)[10]. Taylor wrote, “No one is to blame for this. It is very hard for a democracy to make up its mind: and when it does so, often makes it up wrong.”[11],[12],[13]

The secret message

In 1938, U.S. President Franklin D. Roosevelt sent a message of concern about Hitler and Mussolini to Neville Chamberlain. He offered an agreement on disarmament, treaties, and access to raw materials for Germany and Italy in exchange for protecting countries that were likely to be taken over by invasions. Imagine how the world would have changed had Roosevelt’s offer been accepted. We know that it would not have been accepted, because we also knew that Hitler would never have stood by his word. Roosevelt’s offer to Chamberlain was a powerful concern for Europe. Chamberlain trusted Hitler and “feared that Roosevelt’s proposed initiative would offend [Hitler and Mussolini] and cause Chamberlain’s policy of appeasement to collapse.” So, he rejected Roosevelt’s offer. But Hitler planned the war, probably not expecting it to be another world war. There was no alternative, either to appease or go to war. Hitler would accept both war and any gifts of territory that could go along with a signed agreement. Appeasers could claim that concessions would have been wise and could have been successful “if it had not been for the unpredictable fact that Germany was in the grip of a madman.”[14]

Shortly after the rejection of Roosevelt’s offer, Hitler invaded Austria. And soon after Chamberlain signed the Munich Agreement, permitting German annexation of the Sudetenland, Hitler invaded Czechoslovakia, and later Poland, and Mussolini invaded Albania. Not yet by definition a world war, Britain and Germany were at war. The world would be drawn in later. Would Roosevelt’s offer work to avoid a world war? No one can say. However, history tells us that letters with novel ideas can change the world. At this moment, I can think of none.[15], [16] “The greatest charge against Chamberlain has been that he always thought that he was right and that those who disagreed with him were wrong.” Kenneth Harris, a British journalist working for The Observer wrote those words in a 1985 New York Times article.[17] It is a tricky assessment of a leader. In a democracy, we elect leaders who we trust to have all the answers to avoid bad conditions for their constituency. Regrettably, there are no such leaders and never have been. We do not elect robots, yet, and in almost every instance of history, despots in authoritarian countries care less about their legacies than their personal gain. They certainly do not have the answers for keeping their countries safe and prosperous. “If valid,” Harris continues, “it was tragic that a man cursed by such myopia decided to deal with monsters like Hitler and Mussolini single-handed.”

Now, why do I dwell on Chamberlain’s regrettable mistake? In this long article about diplomacy, it is just one diplomatic error among many. But it was a mistake that cost more lives than any other, including the WWI mistakes that could have avoided that war.

History gives us the stories that we need so we can learn or relearn what we should have remembered to solve future problems. We render our versions as awareness of the past. Some as hearsay, some as tales with a spin to favor a side. Others are narratives that fall into the archives without verification. We absorb and mix them into the chowder of our opinions. We tend to believe chronicled histories, especially when sanctioned by the renowned among us, whoever they may be. I say this with an awareness that we now live in an age when truth is taken lightly with a hedge on compelling evidence. As a writer, I spend my time searching for evidence in thoughts and in storytelling that dominates all the documents I comb. I am not a historian, so all the truthfulness I search for must be corroborated by multiple sources.

There are calls for Ukraine to negotiate a ceasefire with Russia – lessons learned after Chamberlain’s 1938 blunder dampened Western Europe’s thoughts of peace through diplomatic negotiations. Currently, there are no peace negotiations in place. However, ever since the Ukrainian military advanced into Kursk, inside Russian territory, peace talks may have a peace table foothold. Will negotiated diplomacy satisfy Putin, or does he have a “Sudeten-like” plan to go after more territory in Latvia or Estonia? We don’t know; the conflict shows no signs of slowing down, and with no peace table set for negotiations at this date, there is little hope for peace.

If we go back further, history tells us of how diplomacy works or doesn’t. There were many diplomatic accords surrounding trade and industry. The Organization of Oil Producing Countries (OPEC) is just one. Diplomacy of military buildups and war are central to my theme. So, taking us back in time, far before our world wars, we come to a stage of civilization that, by the historical record, founded the relatively late idea of diplomacy. In Egypt and Mesopotamia, the diplomacy trick was to use marriages as peace-protection alliances. Diplomatic marriages were expedient peace opportunities. The pharaohs of Egypt cleverly used diplomatic marriages with other dominions. Ramesses II had eight wives, two of them Hittite princess sisters to unite an alliance and to form a peace treaty in 1258 BCE with the Hittite Empire (modern Turkey).

Behold then, Khetasar, the great chief of the Hittites, is in treaty relation with Ramses II, the great ruler of Egypt, beginning with this day, in order to bring about good peace and good brotherhood between us forever, while he is in brotherhood with me, he is in peace with me; and I am in brotherhood with him, and I am in peace with him, forever.[18]

Going back another millennium, say to the 24th century BCE, we come to the Cone of Entemena, a cone-shaped terracotta cuneiform treaty agreement describing a generation-long struggle over that land along the Tigris and Euphrates and setting a prescribed boundary between Lagash and Umma. The Cone is what historians believe to be the first legal diplomatic document in recorded history.[19] As the clay tells us, a peace treaty marked an established brotherhood between two ancient city-states, Lagash (today called Al-Hiba) and Uruk (today called Warka). Here is an extract from the inscription translated from Sumerian cuneiform.

For Inanna and Lugal-emus Entemena ruler of Lagas the E-muš, their beloved temple, built and ordered (these) clay nails for them. Entemena, who built the E-muš, his god is Shul-utula. At that time, Entemena, ruler of Lagaš, and Lugal-kineš-dudu, ruler of Uruk, established brotherhood.[20]

The foundation nail of Entemena, the oldest known diplomatic document[21]
Public Domain
The cuneiform foundation nail was inscribed with the peace treaty between Lagash and Uruk: “Those were the days when Enmetena, ruler of Lagash, and Lugal-kinishe-dudu, ruler of Uruk, concluded a treaty of fraternity”. (English)

Cone of Entemena mentioning the alliance with Lugal-kinishe-dudu This file is made available under the Creative Commons CCO 1.0 Universal Public Domain Dedication My source: https://commons.wikimedia.org/wiki/File:Cone_of_Entemena_mentioning_the_alliance_with_Lugal-kinishe-dudu.jpg

States then were relatively small in population and geography, so secure relationships with neighbors were critical for survival and steady connections were essential for fruitfulness. That said, I found little evidence regarding war diplomacy between the 12th century BCE. cuneiform tablets written in Akkadian close enough to the era of Ramesses II and the 7th century AD, when there is far more evidence of peace treaties signed on parchments.

Later, Mesopotamian peace treaties were negotiated through marriages. Diplomatically arranged marriages were common in the ancient Near East in the Bronze Age. Later still, the Greek city-states had diplomats, as did the Roman Republic. Diplomacy then was mostly through representatives who carried gifts, works of art, jewelry, and innovative tools to bribe rulers into alliances, peace treaties, or trade agreements. Greek and Roman alliances happened a long way back in time. Countries are too big and powerful these days when allegiances work only by collective security. Of course, diplomacy erratically continued for 26 centuries, sometimes by dynastic marriages, gift-giving, or simply by messengers traveling on foot or by donkey.

Collective security

Ten years after the United States won its war of independence from Great Britain, under a diplomatic pull into potential European wars, President George Washington declared his country to be a neutral nation. Ten years after that proclamation, the Napoleonic Wars were in full force. With neutrality being a bit lopsided toward France, the United States slipped into its first war since being independent. Few Americans know about that war because there is a tendency to know about wars occurring in one’s lifetime. I was a very young child when WWII ended and certainly knew nothing about WWI before reading Barbara Tuchman’s The Guns of August in my late adulthood. The college students I taught 20 years ago knew nothing about the war in Vietnam, and many high school students today know nothing about the wars in Afghanistan and Iraq but do know a great deal (though confused by misinformation) about the current wars involving Ukraine and Israel. 

Let’s go back a bit to the War of 1812. It did not last long. Wars in the nineteenth century were fought in hand-to-hand combat using small arms, muskets, pistols, sabers, and short-range cannons that had to be reloaded in the face of an ongoing battle with little body protection from cloth uniforms. Soldiers on both sides were battle-worn and fatigued by suffering, pain, and misery. So, yes, combat was brutal, though disease was the primary cause of death.

It was British impressment, the blocking of U.S. trade lanes with France, and Britain’s support of Native Americans that started the war, but the treaty that ended the war, the Treaty of Ghent, recognized that the war was a tie, at least in territorial procurement, and so it established that the war was status quo ante bellum (a stalemate restoring the pre-war borders). Prisoners of war were released and territory captured by one side was returned to the other. From that end, and from that treaty, the United States won a commercial boom from the reopening of trade lanes and better relations with Britain and Canada that lasted for over 200 years. One might say that the Treaty of Ghent, and possibly the war itself, was a gift to all by diplomacy.

Pierre Berton, a twentieth-century Canadian historian specializing in nineteenth-century wars wrote:

“It was as if no war had been fought, or to put it more bluntly, as if the war that was fought was fought for no good reason. For nothing has changed; everything is as it was at the beginning save for the graves of those who, it now appears, have fought for a trifle… but without the gore, the stench, the disease, the terror, the conniving, and the imbecilities that march with every army.”[22]

The Treaty of Ghent was a diplomatic adeptness that turned the United States into a significant economic and political powerhouse of American expansion at the expense of indigenous extirpation. In the early decades following the War of 1812, wars, purchases, and diplomacy enriched the country through a bonanza of new territories, Florida, Louisiana, and Texas.[23]

Diplomacy in the form of peace talks almost always happens eventually in war. Some talks are pretenses for public acceptance of war; others are more genuine. The Korean War was in full battle for a year before any agreement of peace talks. It took eight years for Iran and Iraq to sit at a peace table to finally resolve the First Gulf War in 1980. Successes are measured historically by outcomes. A ceasefire, armistice, recognized stalemate and, more rarely, an estimated recognition of risk, as in the number of deaths and loss of equipment at stake.  Or we can hope that future peace talks will model the brilliance of the “Pig War”, a military conflict between the U.S. and Britain (1859) “over a squabble of a pig” in which there were no human casualties on either side.[24] The Pig War was over almost before it started, but diplomatic envoys, at their tasks of preventing or ending wars in the second half of the nineteenth century, were overwhelmed by territorial and rebellion conflicts involving intolerable numbers of combat deaths that continued through the nineteenth century.

Intolerable, yes. But nowhere near the numbers that would follow in the next century.  

“We declared war because we were bound by treaty to declare war… We began to fight because our honour and our pledge obliged us; but so soon as we are embarked upon the fighting, we have to ask ourselves what is the end at which our fighting aims.” – H.G. Wells, The War That Will End War.[25]

The roughly 20 million WWI deaths dramatically changed diplomacy. Agreements that were strictly between nations were broken at will and circumstance. The world war brought new ideas for peace settlements that were flimsy at best and biased at worst. The League of Nations, a dream of peace after a world fatigue of war, began as a glorious collective security organization with virtually no enforcing body able to answer complaints of the Geneva Conventions of 1864 and 1906. The International Committee of the Red Cross, a neutral medical force, was the enforcer and protector of the sick and wounded combatants. The League, a negotiating body to prevent future wars through a collective security surveillance group, became a negotiating body encompassing 43 founding states in 1920. Conceptually, it was a new idea spawned from the massive numbers of WWI deaths (between 15 and 22 million).

Take the 1919-20 Paris Peace Conference, which started near the Quai d’Orsay in Paris and moved to the Royal Palace of Versailles for the signing of the Treaty of Versailles. The conference was a meeting to settle the international peace after World War I. Starting on January 18, 1919, before any organized collective alliances, it followed several armistices in Salonika (Thessaloniki), Bulgaria, Turkey, Austria-Hungary Germany. It ended as an authentic treaty, later called the Treaty of Versailles, a collective security grouping of 30 nations, including the UK, the U.S., France, and Italy. The Paris Conference created six dovetailed treaties, starting with Versailles and ending with the Treaty of Sèvres, the treaty that dismantled the Ottoman Empire by distributing its territory by mandates to France, the UK, Greece, and Italy, thereby drawing new national boundaries. The unfortunate result was a section of the treaty that blamed Germany for starting the war and held Germany accountable for reparations.

Signing of Peace in the Hall of Mirrors, Versailles 1919
Heads of state sitting and standing before a long table.
Front Row: Johannes Bell (Germany) signing with Herr Hermann Muller leaning over him.

The gathering in the picture above makes peace treaties seem simple. However, the 30 delegates to the signing did not give an impression as to how many dignitaries were involved in working out the agreement and wording of the final treaties at the end of the war. Hundreds were involved. Not an easy outcome for either side.

Misguided negotiations, especially collective security ones, can cause serious problems. The Paris Peace Conference’s formula for the final treaties that ended the war blamed Germany and did nothing to help it recover. Military historians push the notion that anger brought the Nazi Party to right-wing power and the next world war.

In hope of world peace

On January 8, 1918, U.S. President Woodrow Wilson delivered a speech to a joint session of Congress intended as an outline for peace negotiations once World War I was ready for its dénouement. His speech included 14 points drafted by over 150 political and social scientists who analyzed thousands of maps and documents involving economic and political data to present to the peace conference. The fourteenth point proposed a radical idea: the League of Nations, a politically independent collective security organization with a mission of world peace.

Kaiser_Wilhelm_considers_Wilson’s_14 points
Public Domain

Point 14. A general association of nations must be formed under specific covenants for the purpose of affording mutual guarantees of political independence and territorial integrity to great and small states alike. [26]

However, the Treaty did not accept Wilson’s Fourteen Points, which some historians agree to be “the most powerful expression of the idealist strain in United States diplomacy.”[27] Let’s remember that the U.S. became a superpower only after committing itself to fight on the side against Germany, demonstrating that its industrial weight was significant and, therefore, its influence on the world stage of diplomacy. Wilson’s speech was not just a spark for the idea of the League of Nations; it led to a remapping of Europe that bore inventive notions of U.S. foreign policy, international relations, national sovereignty, trade agreements, and diplomacy.

One must ask: How is it that the assassination of one man – even if Archduke Franz Ferdinand of Austria was the presumptive heir to the Austro-Hungarian throne – led to the war? The other Central Powers on the German side signed separate treaties. That war, the war that was to end all wars, brought us the League of Nations, the United Nations, the Paris Peace Conference, the Camp David Accords, the Oslo Accords, the 1968 Paris Peace Talks, the 1995 Dayton Accords, and now the hope for peace talks over the wars in Ukraine and Gaza. 

The wars of this century. How could endings be negotiated, or will one side have to capitulate?

The big wars of the world explode just about every hundred years. For twelve and a half years, starting on May 8, 1803, Europe went through the Napoleonic wars. Two world wars exploded a century later. For exactly six years, starting on September 1, 1939, Hitler’s wars devastated Europe and significant parts of the world’s continents. Today, a century later, we are at it again with Eastern Europe and Middle East wars. Yet we now have the United Nations as our collective security that has enormous legal powers and few enforcement powers to bring to peace the most volatile excuses for war. The United Nations was chartered to, as it says, “save succeeding generations from the scourge of war.” As General David Petraeus wrote in the first chapter of his notably insightful book Conflict, “the hope of mankind was that invasions and warfare might be abandoned as a way of solving international disputes. The universal cry of ‘Never Again’ applied as much to the practice of invading countries as to the monstrous crimes of the Nazi era. It was as noble as it was naïve.”[28]

Let’s not forget that even after the end of the war that killed 60 million people and the slogan “Never again,” we continued to have multiple cross-border warfare, not just skirmishes that have lasted for almost 80 years, since the British partitioning of the Indian subcontinent and the Palestinian Mandate. In those 80 years, there have been close to a hundred serious diplomatic attempts to settle “again and again” disputes.

Diplomatic miscalculations

Less than a week after the U.S. began bombings targeting military camps in Taliban-ruled Afghanistan, the Taliban offered to hand over Osama bin Laden in return for an end to the bombings. According to the Public Papers of the President of the United States, George W. Bush, there was an exchange between reporters and the President as they returned to the South Lawn at the White House from Camp David on October 14, 2001.[29] In the exchange, the President is referring to Osama bin Laden as “him”, leader of the al-Qaeda terrorist organization.

Q: Mr. President, there’s a new offer from the Taliban to turn over bin Laden. What’s your response to that, sir?

President: Turn him over. Turn him over; turn his cohorts over; turn any hostages they hold over; destroy all the terrorist camps. There’s no need to negotiate. There’s no discussions. I told them exactly what they need to do. And there’s no need to discuss innocence or guilt. We know he’s guilty. Turn him over. If they want us to stop our military operations, they’ve just got to meet my conditions. Now, when I said no negotiation, I meant no negotiation.

Q: You reject his offer?

President: I don’t know what the offer is. All they’ve got to do is turn him over, and his colleagues and the stocks he hides, as well as destroy his camps, and the innocent people being held hostage in Afghanistan.

Q: They want you to stop the bombing and see evidence.

President: There’s no negotiation – they must have not heard – there’s no negotiation. This is non-negotiable. These people, if they’re interested in us stopping our military operations – we will do so if they meet the conditions that I outlined in my speech to the United States Congress. It’s as simple as that. There’s nothing to negotiate about. They’re harboring a terrorist, and they need to turn him over – and not only turn him over, turn the al-Qaeda organization over, destroy all the terrorist camps – actually, we’re doing a pretty good job of that right now – and release the hostages they hold. That’s all they’ve got to do, but there is no negotiation, period.

In 2001, when the Taliban controlled Afghanistan and sheltered al-Qaeda after the 9/11 attacks, a U.S.-led military coalition attacked the Taliban. After the first 10 years of war in Afghanistan, the U.S. decided it was time to negotiate peace. An Afghan High Peace Council was established with a U.S. understanding that dealing with the Taliban would go nowhere, though significant gains from a surge and backing from the tribal elders made a timely peace deal possible. But 10 years?! There had been replicas of peace negotiations, but not with the advisory players. In 2010, NATO held a summit suggesting a transition of all areas to Afghan control, but that summit was never meant to offer a serious peace proposal. Diplomatic hopes and reach-outs were ready for action at the beginning of the big wars of the mid-twentieth century. As for the Afghan war, there were neither preparations nor feelers for a peace table for the first 10 years. But the hopes for negotiations died when news surfaced that Pakistani officials were not part of the plan. Because of that, the Taliban suspended the talks. On-and-off preliminaries to consolidating members for a peace table continued for two years before the Afghans took over the provinces between 2012 and 2014 with NATO and U.S. forces, and when then-President Obama announced a withdrawal of U.S. troops but leaving a relatively small security force. The full withdrawal took six more years, bringing the total Afghan soldier death account to more than 66,000. In February 2020, the U.S. signed an agreement with the Taliban to withdraw international forces from Afghanistan by May 2021. The NATO Allies had already decided to withdraw their troops. They did so a few months later. In the end, the Afghans could not hold their territory and, as NATO and the U.S. pulled out, the Taliban returned. In the almost 20 years of that war, the longest war in the military history of the U.S., 3,621 NATO soldiers died and 20,769 were wounded in action. What was it all for? Wars are like that. They are sometimes fought for good reason, sometimes for revenge, and sometimes by misunderstandings that could be resolved diplomatically. When a war continues for almost 20 years, it obligates leaders to offer off-ramps from the first assault to the last, because people die or lose body parts, to say nothing of the mental damage that comes with witnessing combat. 

In 2020, U.S. officials and representatives of the Taliban began having direct talks in Doha with Afghan officials for a U.S. exit in agreement that Afghan territory would not be used by terrorists or foreign militants posing security threats to the world. It was phase one of an uncertain and thorny process that one year later resolved the conflict peacefully by permitting the Taliban to succeed. But it was the beginning of the end of America’s longest war. In February 2020, the U.S. and the Taliban signed an agreement on the withdrawal of international forces from Afghanistan by the following May. A few months afterward, NATO forces withdrew. The agreement was between the Islamic Emirate of Afghanistan (a state not recognized by the U.S. as a state) and guaranteed, along with enforcement mechanisms, the prevention of “the use of the soil of Afghanistan by any group or individual against the security of the United States and its allies.”[30]

For almost 20 years of struggling through deals with the Taliban, the U.S. was hooked on a purely military solution to the war. Negotiating a peace agreement with terror organizations misses opportunities for peace. Regrettably, the U.S. was never serious about a peace process until it was too late. It had a chance for peace talks when it achieved offerings early on, since the Taliban offered to surrender in exchange for amnesty.  The U.S., focused on a decisive military victory against the Taliban, rejected the offer. An openness to that rare diplomatic opportunity could have narrowed two decades of war to one and saved countless lives.

After over $2 trillion spent in Afghanistan – a cost that researchers at Brown University estimated would be over $300 million a day for 20 years in Afghanistan – for two decades – yes, the American people should hear this: $300 million a day for two decades. So, what is the cost of having a continuous peace negotiation for 20 years? [31] 

Department of State Congressional Budget Justification (in thousands)
Appendix 1, Fiscal year 2023.32

Was it smart to not negotiate at the 10-year mark of the war? A report from the Costs of War project at Brown University’s Watson Institute for International and Public Affairs shows us that the U.S.-led post-9/11 wars killed over 900,000 people and cost the U.S. an estimated $8 trillion, not just $2 trillion if we add the opposition fighters, civilians, journalists, and humanitarian aid workers.

“The deaths we tallied are likely a vast undercount of the true toll these wars have taken on human life,” said Neta Crawford, a co-founder of the project and a professor of political science at Boston University. “It’s critical we properly account for the vast and varied consequences of the many U.S. wars and counterterror operations since 9/11, as we pause and reflect on all of the lives lost.”[33]

Given that report, one wonders if it was wise not to accept negotiations at a time when so much killing and destruction could have been avoided. And as for cost, taking the Project’s estimate of $8 trillion, it was $1.2 billion per day, a staggering amount! At a daily diplomatic negotiating cost of far, far less, the war would have ended early in its first 20 days, rather than years after achieving its goal. My estimated cost of negotiations is less than $100 thousand per day; that’s eight-thousandths of one percent of the daily cost of that war. However, 20 days would not have been enough for NATO’s gamble with, on the one hand, its calculated odds of victory and, on the other, a winning bargaining position.  

With so many think tanks linked to government-awarded contracts for war-related intelligence think tanks, we must wonder how we still lose the battle between peace and war when many of those tanks are research institutes focusing on political, military, and war-negotiating government strategies. Some government strategies work. We know that many truces in this century came through unilateral, bilateral, and multilateral agreements. Larger countries at war, though, are troubled by locked ideals that are not so easily negotiated.

The newest brutal wars of attrition

According to the Geneva Academy of International Law and Human Rights, there are at this moment more than 42 wars and so-called “armed conflicts”[34] on four continents happening at the expense of an average of 166,000 deaths per year and 3,287,478 cumulatively for just six of the more than 40 ongoing wars.[35] The actual numbers are much higher. The International Committee of the Red Cross counts over 120 ongoing armed conflicts worldwide.[36] The Sudanese and Myanmar civil wars are the most brutal internal ones, with no impending resolutions. They are complex, as all civil wars are. Here, we concentrate on the two most recent explosive international wars.

Europe and the Middle East are missing opportunities for peace as they fall into the typical strategic war games of diplomacy shaping, with each side waiting for the best time advantage for the best peace offer.

Kyiv after a Russian missile strike in 2022.
File licensed under the Creative Commons Attribution 4.0 International license.
Taken from https://en.wikipedia.org/wiki/Russian_strikes_against_Ukrainian_infrastructure_(2022%E2%80%93present)#11%E2%80%9331_October

Five peace talks between Russia and Ukraine in the first year of the war were extraordinary in that the later ones happened as face-to-face meetings between high-level ministers of Russia and Ukraine. Most peace talks go through diplomatic paths facilitated by third-party states. Meetings did happen in March 2022, when the Russian advance was waning. Meetings began in Belarus and Turkey, with a framework for a settlement drafted with the hope of a treaty signing, partly because the war was not going so well for Russia.[37] Two months later, battlefield conditions realigned, and Western weapons support gave Ukraine enough confidence to believe it could win the war. So, as almost always happens with imbalanced belief in odds, the talks broke down. It was the last face-to-face meeting, offering no agreements to end the fighting.[38]

The Belarus / Turkey (then called the Istanbul Communiqué) meeting came close to a signed treaty that would have ended the fighting. Officially, it was called the Treaty on Ukraine’s Permanent Neutrality and Security Guarantees. That treaty, drafted on April 15, 2022, was never implemented because it put heavy obligations on the West. Seven states would act as guarantors required to assist Ukraine. It was “in the event of aggression, any armed attack on Ukraine or any military operation against Ukraine, each of the Guarantor States” will assist Ukraine, taking whatever action necessary. The problem was that necessary action included the possibility of closing airspace over Ukraine, providing weapons, and using armed forces “to restore and subsequently maintain the security of Ukraine as a permanently neutral state.”[39] Surely, it was a non-starter. First, it obligated the U.S. to go to war with Russia in the event of another Russian invasion of Ukraine. Second, the Russians would not accept wording in the treaty giving Ukraine “the right to individual or collective self-defense recognized by Article 51 of the Charter of the United Nations.” Third, the Ukrainians objected to the wording that guarantors would decide independently whether to come to Ukraine’s defense. The Russian view was to subvert the article based on agreements between all guarantor states. Even now, two years later, Putin does not want to negotiate a ceasefire agreement because he needs to show his country that his costly invasion has a purpose, “to destroy Ukraine as a nation.”[40] For that to happen, he cannot negotiate peace. Ukrainians remember the 2015 ceasefire under capitulation after Russia invaded and annexed the Crimean Peninsula from Ukraine, which broke in the 2022 full-scale Russian invasion. So, for a peace treaty to succeed, Its articles must include tight security guarantees that would force a ceasefire to hold. Such a treaty could happen as battle fatigue lingers another year. As for now, though, there is no deal. And so it goes: Ukraine will not sign a peace agreement that does not guarantee its security, and Russia will not sign if it does.

New meetings have been stalled for 32 months since the last unsigned April 2022 treaty, with no suitable approaches for a settlement, even though it seems clear that that war, like so many others, will end in negotiations. If the war continues without significant battlefield advantages on one side or the other, neither side will talk of peace while hoping for some gain for a settlement. Samuel Charap, Senior Political Scientist at the RAND Corporation, and Sergey Radchenko, Research Director of the European Council on Foreign Relations, wrote in Foreign Affairs, “What happened on the battlefield is relatively well understood. What is less understood is the simultaneous intense diplomacy involving Moscow, Kyiv, and a host of other actors, which could have resulted in a settlement just weeks after the war began.”[41]

Ukraine President Volodymyr Zelenskyy honored the memory of the warriors who gave lives defending their homeland.
Public Domain

In a recent Ukrainian radio interview, President Zelenskyy said, “From our side, we must do everything so that this war ends next year and ends through diplomatic means.”[42] A few days before, Vasily Nebenzya, Moscow’s ambassador to the UN in Geneva, said that Russia would be open to negotiations to end the war if Ukraine would acknowledge “realities on the ground.” [43] Does that open another peace talk? That is not likely if realities on the ground force Ukraine to give up 20 percent of its territory with no permanent security guarantees. And so, as of this writing, the war in Ukraine war continues open-endedly with no open bilateral or multilateral negotiations in the face of more than one million casualties from both sides. [44] Still, there is new hope for an imminent settlement because each sees the delicate business of negotiating with what it might have of value to craft somewhat of a win and save face.

Differently, the other international hot war, the Israeli-Hamas War, the fifth and largest one between Israel and Hamas that has been raging on and off for the last 15 years, has negotiated now and then dismissively from almost the beginning, with just one ceasefire and hostage release talk sponsored by independent state mediators. Qatar has been playing a sensitive role in multilateral negotiations ever since October 2023, when the war in Gaza began. It is strikingly unusual for peace negotiations to begin so near a war’s start. A month later, Qatar brokered a temporary ceasefire that released 105 of the 251 civilian hostages taken on October 7, 2023.

As of this writing, Qatar has withdrawn as the mediator for the conflict because both sides refused to negotiate in good faith. In mid-October, during an earlier round of peace talks in Doha, Hamas held its position for negotiation as a complete end to the war and a full withdrawal of Israeli troops from Gaza, with no short-term ceasefire. For more than a year, the U.S., Egypt, and Qatar have tried to broker a ceasefire, all unsuccessful because one or the other combatant states has not been ready. It is a show of strength that must emerge on one side for the other to agree to negotiate in good faith when the odds are not high for victory but best for avoiding heavy losses. Israel has also rejected deals. In November, Benjamin Netanyahu rejected a peace deal because he would not consider a ceasefire if talks aimed against Israeli control of Gaza’s border with Egypt. So, with two sides unwilling to sit down together because of the overwhelming obstinacy of agreements, peace cannot happen. 

The good news is that negotiations can work to bring wars to peace. While writing this column, a ping on my laptop called me to read an announcement that Israel and Lebanon have agreed to a U.S.-brokered ceasefire deal. The Israeli security cabinet voted in favor of ending the fight between Israel and Hezbollah, at least temporarily, since, as with every battle in the Near East, nothing is certain. It is a remarkable achievement, though – five stars for the persistent negotiating spirit.

Still, the Israeli wars with its Palestinian adversaries will continue for as long as Benjamin Netanyahu is the Israeli Prime Minister and Mahmoud Abbas remains the president of the Palestinian Authority. Both leaders are corrupt and ineffective in winding down the constant aggressions that only serve to hurt their people. A move closer to stopping the Gaza war and freeing the hostages is unlikely. A lasting peace is hopeless under the obstacles of Netanyahu and Abbas’s counter-position leaderships and impossible with their disregard for the lives and needs of Israelis and Palestinians and without the creation of a Palestinian state. For the sake of the Israeli / Palestinian future in peace, there must be a change in leadership.

States at war tend to continue their battles without seriously considering negotiated settlements. Once a war is active, the fight becomes a bargaining contest, with each side in mutual mistrust of the other, hoping to get a favorable peace agreement. The fate of war is a high gamble, but so is the timing of negotiations. Killing and wounding are costly war concerns, partly because they spark a persistent cycle of revenge that swells the expense and partly from mistakes on the battlefield or early estimates of achievements. Active wars always have reasons to continue with strategic diplomacy plans as soon as the other side seems ready to make an acceptable offer to open communications. Negotiating is difficult when both sides are optimistic that their odds of winning are high enough for an advantage. Battlefield engagements measure true odds based on relative strength, as revealed in battlefield successes. Negotiation is often just a waiting match. Punishing the other side enough to cede a few bargaining chips is a wise strategy, especially when there is an opportunity for bargaining for peace. Suspicion of inclination to talk is often seen as a weakness of resolve, even a form of surrender. So, negotiation settlements are strategic games of timing that weigh between the price of war and the odds of winning. Without serious offers and a balance of determination, both sides wait for the best time to accept a seat at the peace table. Nations at war want victory without destruction, which translates to bargaining power; yet when negotiations are too late to favor one side or another, war and all its death and destruction end, having served no one other than weapons dealers and manufacturers.

About the Author

Joseph MazurJoseph Mazur is an Emeritus Professor of Mathematics at Emerson College’s Marlboro Institute for Liberal Arts & Interdisciplinary Studies. He is a recipient of fellowships from the Guggenheim, Bogliasco, and Rockefeller Foundations, and the author of eight acclaimed popular nonfiction books. His latest book is The Clock Mirage: Our Myth of Measured Time (Yale).

Follow his World Financial Review column at https://worldfinancialreview.com/category/columns/understanding-war/. More information about him is at https://www.josephmazur.com/

References

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  2. [2] Thomas C. Schelling, Arms and Influence (New Haven: Yale University Press, 2020) 7.
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Argo Navis School: Boosting Your Wealth with Financial Literacy Basics

Person sitting while holding a newspaper
Photo by Adeolu Eletu on Unsplash

Financial literacy encompasses a wide range of skills that help individuals manage their money, make informed financial decisions, and plan for the future. Without a foundational understanding of how finances work, people are more likely to make decisions that can lead to debt, financial stress, and an inability to build wealth. On the other hand, those who are equipped with essential financial knowledge and skills are better positioned to avoid common pitfalls and make choices that contribute to long-term well-being.

Whether it’s learning how to budget, mastering the art of saving, managing credit, or exploring investment opportunities, these skills are critical for anyone hoping to secure their financial future. In the following sections, Argo Navis School, delves into the core aspects of financial literacy, offering insights and guidance on how individuals can improve their financial status and build wealth over time.

Essential Financial Skills

Budgeting is one of the most important financial skills that everyone needs to master. It involves tracking your income and expenses, ensuring that you aren’t spending more than you earn. Many people underestimate the importance of sticking to a budget, but it creates a clear roadmap for where your money is going.

Saving is another pillar of financial literacy. Whether it’s building an emergency fund or setting money aside for future goals, developing a habit of saving can provide a safety net. Different types of savings accounts, such as high-yield savings or certificates of deposit, can offer a range of options depending on your needs and goals. Consistent saving, no matter the amount, can make a considerable difference over time, and it prevents the need to rely on credit when unexpected expenses arise.

Debt management is equally important. Understanding how to manage debt, especially high-interest debt, can prevent financial stress and help individuals maintain financial flexibility. People who effectively manage their debt are in a better position to take advantage of opportunities, such as purchasing a home or investing in education, without being weighed down by financial burdens.

Amassing Wealth Through Smart Financial Decisions

Accumulating wealth doesn’t happen overnight, but making smart financial decisions can accelerate the process. By tracking your spending and cutting unnecessary expenses, you can free up more money to put toward savings or investments. Over time, even small contributions to an account can grow significantly, thanks to the magic of compound interest. It’s a slow yet effective pathway to financial freedom.

Investing is one of the best ways to make your money work for you. Whether it’s through stocks, bonds, or mutual funds, the potential for returns can often outpace the growth sitting in a traditional savings account. The earlier you start investing, the more time your money has to grow. This is why understanding the basics of investing is a cornerstone of wealth-building.

Compound interest plays a pivotal role in wealth accumulation. When you earn interest on your initial investment and the interest it generates, your funds can grow exponentially over time. This is particularly true for long-term investments, where the effects of compounding become more pronounced the longer you leave your money invested. Many people underestimate the power of compound interest, but it can turn small, regular contributions into a substantial sum over several decades.

Managing Credit and Debt

Credit plays a major role in one’s financial health. A good credit score can open doors to lower interest rates on loans, better credit card offers, and even favorable insurance rates. On the other hand, a poor credit score can be a barrier to financial opportunities. Monitoring credit and making timely payments is crucial in ensuring that your score stays healthy, as even a few missed payments can have long-lasting adverse effects.

Improving and maintaining good credit requires a blend of discipline and planning. Paying off outstanding balances, keeping credit utilization low, and avoiding unnecessary loans or credit inquiries are all effective ways to boost your score. People often overlook the importance of their credit report until something goes wrong. Regularly checking your report can help you catch any errors or signs of fraud early, which can prevent financial setbacks.

If not appropriately managed, debt can become overwhelming. High-interest debt, such as credit card balances, can quickly spiral out of control if left unchecked. Paying off debt, starting with the highest interest rates first or consolidating loans, can help one regain control over one’s financial situation. By staying on top of debt payments and avoiding unnecessary borrowing, individuals can avoid the cycle of stress that often comes with overextending credit.

Avoiding Financial Pitfalls

Impulse spending can seriously disrupt a budget, leaving little room for savings or investments. It’s easy to justify small purchases, but over time, they add up and can prevent people from reaching their larger financial goals. A lack of financial planning is another pitfall that many fall into. Ignoring debt is another mistake. When individuals let debt accumulate without addressing it, interest rates can balloon, making it even harder to pay off.

Recognizing these pitfalls early and taking proactive steps to avoid them can make all the difference. Creating a financial plan and sticking to it is one way to steer clear of these common mistakes and maintain financial health. Practical strategies like setting aside funds for savings before allocating for discretionary spending can help avoid these traps. Additionally, automating bills and savings contributions can ensure that payments aren’t missed, helping individuals stay on top of their finances without the stress of managing every little detail.

Tools for Financial Growth

There are countless resources available to help individuals improve their financial literacy, from books to online courses to financial management apps. Many of these tools can simplify the process of tracking expenses, setting savings goals, or learning more about investing. People who take advantage of these resources are often better equipped to make informed decisions that contribute to long-term financial growth. Staying informed and using the right tools can make the difference between struggling and success.

Navigating Rental Income and Tax Deduction: Guide for Landlords in 2025

Flat lay of real estate

Owning investment property is a perfect way to build wealth. However, it comes with many tax implications for landlords as well. As a landlord, you should be familiar with how you are taxed for income generated on rental properties. Keep reading below as we share more details on how rental income is taxed and how landlords can navigate this and benefit from it in return.

How is Rental Income Taxed?

When you collect rent from tenants, that money is considered taxable income by the IRS and state tax authorities. You must report all rental income you receive during the tax year and pay appropriate taxes on it. This income is typically reported on Schedule E of your Form 1040.

There are two main components for calculating taxes on rental income:

Gross Rental Income

Any income you generate from renting out your property is considered taxable. This includes not just the monthly rent checks but could also include other fees like security deposits you keep, key fees, or move-in fees. The total cash and value you collect for allowing tenants to use your property is your gross rental income that must be reported.

Expenses & Deductions

Once your gross rental income is determined, you calculate your net taxable rental income by factoring in allowable deductions and expenses. Allowable expenses typically include mortgage interest, property repairs, management fees, utilities, property taxes, and depreciation. By deducting these expenses, you can lower your net taxable rental income and lower your tax burden. The key is to keep detailed records of all your rental income sources and expenses. This allows you to calculate net rental income accurately and ensure you get all the deductions you are entitled to. The next section will provide more details on allowable rental property tax deductions.

Common Deductions For Landlords

Young couple going through their finances

One of the best parts of owning investment property is getting to take advantage of tax deductions to reduce your rental income tax burden. When you operate your rental property like a business, you open up deductions for rental expenses. Let’s take a look at some of the most common and valuable tax deductions landlords should know.

Property Taxes

Any state, local, or real estate taxes you pay on your rental property can be deducted from your federal return. This includes property tax bills as well as specialty district taxes. Be sure to deduct the portion of your property tax that applies to the rental portion if you live in part of the property.

Repairs & Maintenance

Expenses for any repairs and routine maintenance done on your rental property can be deducted in the year paid. This includes things like painting, appliance repairs, handyman services, lawn care, pest control, and snow removal. Just ensure the expenses are reasonably necessary rental expenses, not upgrades or improvements.

Depreciation

One of the largest deductions landlords can take is depreciation on their rental property. This allows you to deduct a portion of your rental property value each year to account for decreasing value from aging and use. For residential properties, this deduction is taken over 27.5 years. So, if you bought a $300,000 rental property, you could deduct around $10,900 per year.

Travel

Believe it or not, some travel expenses related to your rental can be deductible. Gas, mileage, airfare, lodging, and 50% of meals associated with time spent working on or evaluating your rental can potentially be written off. For example, a trip to meet a contractor doing renovations or visiting your rental for a walkthrough of issues to address. This is one of the lesser-known property investment tips that you shouldn’t ignore.

Rental Management Fees

Do you pay a property management company? These fees are deductible rental expenses. You can write off what you pay the management company for collecting rent, finding tenants, handling repairs and upkeep, or overall administering your rental property. Be strategic in deducting expenses using write-offs and take advantage of tax benefits as a landlord.

By fully using these and other eligible rental property deductions, landlords can realize significant tax savings each year. Be sure to consult the latest IRS rules and regulations around claiming rental deductions each tax year. Work with an active rental manager in Northern Virginia for proper documentation of your property-related expenses. With proper documentation and reporting, you may be able to deduct more expenses than you realized were available as a landlord.

Taking the Proactive Approach to Understand Tax Changes

As a landlord, one of the worst things you can do is get caught unprepared when tax laws change. Being blindsided by a new tax rule that limits one of your deductions could take a toll on your rental property profits. That’s why it’s critical to be proactive each year in understanding upcoming changes to rental property tax codes—before filing your tax return.

Follow Industry Publications

Publications like Landlord Magazine, Rental Property Reporter, and Fit Small Business offer great rental property tax updates each year. Subscribe to a few leading industry blogs, newsletters, or print magazines. This can clue you into major changes being proposed or finalized by the IRS that could impact your tax scenario.

Consult Your CPA

Schedule a consultation with your CPA at the beginning of each year—before you file taxes. Ask them specifically if there are any major rental property tax changes in effect that may alter your past filing approach. Maybe certain deductions were capped for the current tax year, or new schedule requirements will apply to depreciation claims. Keep your CPA in the loop on your rental activities so they can best advise you.

Continuing Education

Consider taking a continuing education tax course annually that is tailored specifically to rental property taxes. Even a short 4-hour online class can get you up to speed on the latest IRS rules around reporting income, taking deductions, record-keeping requirements, and flags to avoid. Both local colleges and national providers offer accredited continuing education around taxes.

Final Words

While staying on top of evolving rental property tax codes does require some time investment, it’s well worth it. The small effort you put into understanding changes proactively will pay off exponentially in tax savings and avoidance of issues with the IRS down the road. Make it a priority to check in on any new rental tax laws each year. Then, you can stay away from tax complications while enjoying the income generated by your rental properties.

China Warns Trump Over Fentanyl Tariff Threats, Cautions Against Trade War

trade war and economic strain

China’s state media issued a stern warning to U.S. President-elect Donald Trump on Tuesday, cautioning that his pledge to impose additional tariffs on Chinese goods over fentanyl trafficking could trigger a damaging trade war between the world’s two largest economies. Trump, who is set to take office on January 20, announced on Monday that he would impose a 10% tariff on Chinese imports until Beijing curbs the flow of chemical precursors used to produce fentanyl, a deadly drug.

Chinese editorials in China Daily and Global Times rejected Trump’s rationale, stating that using fentanyl as a pretext for further tariffs was “farfetched” and warning that no one benefits from a tariff war. Economists have already begun downgrading China’s growth forecast for 2025 and 2026, anticipating that Trump’s tariff threats could further strain the global economy. With a history of trade tensions, China’s industrial sector, which sells over $400 billion worth of goods annually to the U.S., is bracing for more economic pressure.

While Chinese officials remain confident in long-term economic growth, the threat of escalating tariffs has rattled markets and left businesses on edge.

Related Readings:

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USA and china

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Why the New Administration’s Plan to Force Feds Back to the Office Could Lead to Meltdown

Employees over American flag

By Dr. Gleb Tsipursky

The Trump administration’s initiative to mandate a full-time return to the office for federal employees has ignited heated debate over its practicality and implications for government efficiency. Spearheaded by entrepreneur and former presidential candidate Vivek Ramaswamy, who has been tapped to lead the newly proposed Department of Government Efficiency (DOGE), the plan seeks to reduce the federal workforce through a strategy designed to prompt mass resignations. In an interview with Tucker Carlson, Ramaswamy described the policy as a means of “streamlining bureaucracy” by making federal jobs less appealing to those who value flexible work arrangements. However, critics argue that this approach would squander taxpayer money, disrupt essential government functions, and undermine the quality of public service delivery, as highlighted in a recent Office of Management and Budget (OMB) report.

Ramaswamy’s vision hinges on eliminating telework options and enforcing strict in-office attendance as a mechanism to drive attrition. He estimated that roughly a quarter of federal employees would voluntarily leave their positions if such measures were imposed, reducing payroll costs without direct layoffs. This “radical idea,” as Ramaswamy called it, was pitched as a way to shrink a federal workforce that he characterized as bloated and overreaching. However, Carlson raised concerns about the plan’s feasibility, pointing to the robust job protections afforded to federal employees, which make involuntary terminations notoriously difficult. Ramaswamy brushed off these concerns, maintaining that revoking remote work privileges would naturally compel resignations.

Proponents of the plan argue that cutting the federal payroll, which stands at $110 billion annually, would lead to a leaner and more efficient government. They contend that reducing headcount will eliminate inefficiencies and curb excessive regulation. Ramaswamy portrayed the move as a necessary step to dismantle bureaucratic inertia, asserting that many unelected federal employees create regulatory burdens that undermine legislative authority. “If you simply require them to show up at the office Monday through Friday,” Ramaswamy stated, “a significant portion would choose to leave, simplifying government processes and reducing overhead.”

Despite these claims, the proposal appears economically shortsighted and operationally hazardous. The federal workforce of 2.2 million employees oversees a $6.1 trillion budget, meaning salaries account for just 1.8% of expenditures—a remarkably low overhead for such a vast operation. These employees perform critical functions across agencies like Homeland Security, the Department of Education, and the Federal Reserve. Forcing resignations at scale would create a talent vacuum in roles requiring specialized knowledge and skills. The resulting need for recruitment, onboarding, and training of replacements would not only delay a return to full operational capacity but also generate significant costs that could eclipse any perceived savings. Furthermore, the abrupt loss of experienced personnel would disrupt ongoing projects, diminishing the efficiency and quality of public services.

This approach also disregards the proven success of remote work in the federal sector. During the COVID-19 pandemic, telework enabled government agencies to sustain productivity while reducing operational expenses tied to physical office spaces. OMB findings indicate that flexible work arrangements enhanced efficiency and cost-effectiveness. Reversing these gains would necessitate substantial reinvestments in office infrastructure, including utilities, maintenance, and security, potentially nullifying anticipated payroll savings. Taxpayers would ultimately bear the burden of these avoidable expenses.

Ramaswamy has framed the initiative as part of a broader agenda to overhaul federal regulations. He suggested that cutting workforce numbers could invalidate up to 50% of existing rules, many of which he claims are crafted by unelected officials. While this rhetoric may appeal to critics of federal bureaucracy, it overlooks the intricacies of governance and the essential role of institutional expertise. Federal employees do more than draft regulations; they implement policies enacted by Congress, ensuring the smooth delivery of programs and services that millions of Americans depend on, from Social Security to disaster relief.

The human and economic costs of this policy extend beyond the immediate federal workforce. Morale among remaining employees would likely deteriorate under increased workloads and eroded institutional knowledge, leading to further attrition and a self-perpetuating cycle of inefficiency. Industries reliant on federal oversight would face delays and disruptions, imposing costs on businesses and state governments alike. These cascading effects would exacerbate waste and inefficiency rather than alleviate them.

Rather than resorting to a blunt-force approach aimed at workforce reduction, the government should pursue nuanced reforms that balance efficiency with service quality. Modernizing outdated systems, embracing digital transformation, and leveraging the proven benefits of remote work are far more effective strategies for achieving cost savings and operational excellence. Ramaswamy’s presumption that fewer employees automatically equate to better governance oversimplifies the complexity of federal operations and risks undermining critical public programs.

In forcing federal employees back to the office under the guise of driving resignations, this policy sacrifices functionality for optics. Instead of creating a streamlined government, it threatens to dismantle the institutions that underpin national stability and public trust. Clinging to outdated workplace paradigms in an era of demonstrated telework success is not just inefficient—it is economically reckless and a disservice to taxpayers.

About the Author

Dr. Gleb TsipurskyDr. Gleb Tsipursky was named “Office Whisperer” by The New York Times for helping leaders overcome frustrations with hybrid work and Generative AI. He serves as the CEO of the future-of-work consultancy Disaster Avoidance Experts. Dr. Gleb wrote seven best-selling books, and his two most recent ones are Returning to the Office and Leading Hybrid and Remote Teams and ChatGPT for Thought Leaders and Content Creators: Unlocking the Potential of Generative AI for Innovative and Effective Content Creation. His cutting-edge thought leadership was featured in over 650 articles and 550 interviews in Harvard Business Review, Inc. Magazine, USA Today, CBS News, Fox News, Time, Business Insider, Fortune, The New York Times, and elsewhere. His writing was translated into Chinese, Spanish, Russian, P olish, Korean, French, Vietnamese, German, and other languages. His expertise comes from over 20 years of consulting, coaching, and speaking and training for Fortune 500 companies from Aflac to Xerox. It also comes from over 15 years in academia as a behavioral scientist, with 8 years as a lecturer at UNC-Chapel Hill and 7 years as a professor at Ohio State. A proud Ukrainian American, Dr. Gleb lives in Columbus, Ohio.

The Decline of the West and Shifting Dynamics in the Global Political Economy 

symbols of countries on the chessboard against against the background the political map of the world.

By Dr Kalim Siddiqui 

I. Introduction 

By the end of the Second World War, the limitations of free-market and non-interventionist economic policies had become apparent. In response, a Keynesian interventionist approach was adopted by major capitalist countries, ushering in a period of economic prosperity. Over the following quarter-century (i.e. 1945-1972), these policies spurred growth in employment and incomes across leading economies. However, international developments—including the Cold War, decolonization, and rising inflation—introduced new challenges for global capitalism (Siddiqui, 2023a). And by the mid-1970s, the Keynesian model was struggling to address the deeper structural crises of monopoly capitalism. In its place, neoliberal “free market” policies began to emerge across major economies and were later imposed on developing nations in the 1980s as they grappled with debt crises and external repayment pressures. 

Colonial capitalism, in its earlier forms, tolerated some level of dissent within its colonies. Leaders of independence movements—such as Mahatma Gandhi, Jawaharlal Nehru, Maulana Abul Kalam Azad, Sardar Patel, Sukarno, Mossadegh, Ben Bella, Nkrumah, and Nelson Mandela-advocated for social equality, freedom, and independence. Despite facing oppression and undemocratic policies, they were not eliminated by colonial authorities. However, contemporary instances, such as Israel’s treatment of Palestinians, reflect a harsher approach toward occupied populations and their leaders. 

Since 1948, Israel has implemented policies that have systematically undermined Palestinian rights, with actions including ethnic cleansing and land expropriation. This settler-colonial project, initially supported by Britain and later by the United States (US), has allowed Israel to pursue expansionist policies—displacing populations and controlling land and water resources. For years, Israel has imposed a blockade on Gaza, tightly controlling its contact with the outside world through military means. The recent conflict in Gaza has highlighted the extent of Israel’s actions, with reports of targeted destruction of hospitals, schools, playgrounds, mosques, and refugee shelters. The humanitarian situation in occupied Palestine underscores the global community’s failure to address the ongoing violence and the continued displacement of Palestinians in Gaza and the West Bank (Siddiqui, 2024a). 

II. Capitalism, Imperialism, and Hegemony 

Capitalism is a system in which private owners control production and resource distribution, with economic activities driven by market competition. At its core, capitalism is founded on private property rights, encouraging efficiency as resource owners seek to maximize the value of their assets. Profit serves as the primary motivation for individuals to engage in economic exchanges, with the expectation of mutual benefit. 

Imperialism marks a phase in capitalism characterized by monopolistic control and dominance of financial capital. In this stage, European powers divided the world among themselves, extending their influence over other countries and territories to benefit their own economies. This imperialist expansion led to significant global economic inequalities and the restructuring of colonized economies to serve metropolitan capital. (Siddiqui, 2023b) 

The concept of hegemony, explored by Paul Kennedy in The Rise and Fall of the Great Powers (1987), has been central to discussions of global power dynamics. Hegemony describes periods in which one power exerts dominance over others, shaping international policies. Following World War II, this idea gained prominence in the context of the decline of European colonial empires and the rise of a postwar liberal international economy under US leadership. Economic historians and theorists such as Immanuel Wallerstein and Charles Kindleberger expanded on the concept, with Kindleberger’s analysis of the Great Depression of 1930s sparking the “hegemonic stability theory” debate among neorealist and liberal scholars. 

While Britain and other European powers pursued direct military control over overseas territories, the United States adopted a model of informal empire after World War II. Although the US did not engage in traditional colonialism, it exerted considerable influence over other countries through economic and military means. Countries, particularly in Latin America, gained political independence but remained economically subordinated to foreign powers. The neocolonial approach enabled metropolitan powers to maintain economic dominance, fostering global inequalities and regional tensions even after the formal end of empire. 

The US hegemony has been sustained through its economic, political, and military leadership, along with the cooperation of allies and economic rivals. The 1944 Bretton Woods Agreement exemplified the US vision for a postwar economic order, establishing frameworks that would enable it to lead the global economy. 

More recently, Fukuyama (2021) observed that the peak of American hegemony spanned less than two decades—from the fall of the Berlin Wall in 1989 to the 2007–2009 financial crisis. During this period, the United States held significant power across military, economic, political, and cultural domains. The height of this influence was marked by the 2003 invasion of Iraq, in which the US aimed not only to reshape Iraq and Afghanistan but also to remake the broader Middle East (Fukuyama, 2021). 

The European Union could have countered US hegemony by opposing NATO’s eastward expansion, potentially mitigating tensions with Russia and averting the Ukraine conflict. However, collective EU action failed to align with its long-term interests. The Ukraine war has subsequently drawn the EU closer to the US, both economically and in terms of defence. As a result, the EU’s reduced trade and cooperation with Russia has led to energy crises, inflation, and economic instability within Europe (Siddiqui, 2022a). 

III. Decline of the West as an Economic Power 

The decline of Western economic dominance and the waning of US hegemony is a subject of ongoing debate. Some scholars argue that emerging economies in the Global South, particularly China, will succeed the US in leading the world economy, potentially dominating future cycles of capitalist accumulation. Others suggest that this shift will be fraught with challenges and may not unfold peacefully (Siddiqui, 2022b). 

The decline of manufacturing in the US and UK began in the 1980s due to economic factors, and globalization and trade liberalization since the 1990s accelerated this shift, moving manufacturing bases from the US and EU to East Asia, China and India. East Asian economies, by contrast, achieved remarkable growth starting in the 1980s, with substantial increases in per capita incomes, exports, and living standards driven by expanded trade and the influx of foreign capital and technology. After the collapse of the Soviet Union in 1991 and the global spread of neoliberal policies, a new cycle of economic growth and prosperity was anticipated. Instead, inequality and economic crises deepened in advanced capitalist economies. The prolonged wars in Afghanistan and Iraq, followed by the 2008 global financial crisis, further exposed the signs of US decline, reflected in slowed productivity, stagnant wages, growing trade deficits, and mounting foreign debt. (Siddiqui, 2019)  

Historically, the West’s economic dominance has shifted. From 1814 to 1914, British hegemony, or Pax Britannica, relied on superior naval power and technology to control colonies and exploit their resources, often through force. This era was marked by significant violence, two World Wars, and the Great Depression. After World War II, the US emerged as the new global hegemon, with its rivalry with the Soviet Union resulting in the Cold War (1947–1990). In the aftermath of the Cold War, the US stood as the sole superpower, ushering in a unipolar world order. 

IV. Major Theories of International Geopolitics 

Various influential theories address the dynamics of international geopolitics. The first, Hegemonic Competition Theory, often referred to as the “Thucydides Trap,” draws on the work of classical political theorist Thucydides (c. 460–400 B.C.E.), who examined the moral questions surrounding the Peloponnesian War (431–404 B.C.E.) between Athens and Sparta. According to proponents of this theory, China’s rise is likely to lead to a confrontation with the US, echoing Athens’ challenge to the dominant power of Sparta. Currently, the US is seen as weakened both economically and militarily, diminishing its role in global affairs and creating instability. This situation mirrors the decline of Britain after World War I, when it shifted from being the world’s top creditor and capital exporter to becoming one of the largest debtor nations (Siddiqui, 2019). 

The second, Realist Theory posits that geopolitics is shaped by power politics, with emerging economies like China, Russia, and India expected to play increasingly significant roles. Realists view states as the main actors on the international stage, prioritizing national security, self-interest, and power. Realism also tends to be sceptical about the influence of ethical norms in international relations. Growing superpower tensions have revitalized the realist-idealist debate, sparking renewed interest in the realist approach. Realists consider maintaining a balance of power essential during shifts in global economic and military capability. For instance, in 1908, Germany’s GDP surpassed Britain’s, while Russia’s rapidly growing economy reached a GDP on par with Germany’s by 1880, leading Britain to view these rising powers as potential threats to its dominance. 

The third theory, Marxist Theory, offers a distinct critique of geopolitics, examining it through the lens of global financial capital. Academics such as Samir Amin and Immanuel Wallerstein, with his core-periphery model, contribute to this perspective. Marxist theory approaches geopolitical economy through historical-materialist analysis, examining the trajectory of capitalism from its origins to the current era of global financial capitalism and imperialism (Siddiqui, 2023b). Marx’s critique of political economy emphasizes production over exchange, value over prices, and classes over individuals. In contrast, mainstream economic theories often depict the economy as isolated from broader social realities, adopting an ahistorical and abstract approach. 

Following the Second World War, the US emerged as the dominant economic power. Economist Angus Maddison estimated that in 1950, the US produced 27.3% of global output despite comprising only 6% of the world’s population. In comparison, the Soviet Union, the second-largest economy, produced only a third of the US output, with China producing around one-sixth. However, US economic supremacy began to wane in the 1950s as Western European and Japanese economies gained ground in terms of productivity, skills, and growth. 

V. The Rise of China in the Global Economy

Neoliberalism emerged in the late 1970s in the UK and US as a new framework of contemporary capitalism, arising from the perceived failures of post-war Keynesian policies. Under neoliberalism, the state’s role in resource allocation, particularly between consumption and investment, diminished, while capitalists gained greater control over production and finance across national borders. This control has been systematically bolstered by globalized financial corporations, operating with minimal state oversight. 

Since the early 1990s, financialization has further solidified US economic dominance. Neoliberalism imposed strict social and fiscal disciplines, such as adherence to austerity policies, reduced welfare spending, and deregulation of the financial sector (Siddiqui, 2017). These policies have led to increased job insecurity, declining real wages, a reduced share of wages in national income, and growing inequality within many countries. The collapse of the Soviet Union in 1991 and the subsequent global expansion of markets, known as globalization, was seen as solidifying a US-led world order underpinned by free markets and finance.  

Over the past three decades, China’s rise has fundamentally reshaped global politics. Economic reforms initiated in 1987 led to a gradual opening of China’s economy to investment and trade, culminating in its accession to the World Trade Organization in December 2001. Since then, China has transformed from a low-cost manufacturing hub into a global leader in advanced technologies. This shift has restructured global supply chains and altered international diplomacy, establishing China as a key trade and development partner for emerging economies across Asia, Africa, and Latin America. (Siddiqui, 2024d) 

In 1978, China began opening its economy to market forces, initiating a period of unprecedented growth that defied expectations. Between 1990 and 2022, China’s GDP (in constant US dollars) expanded by 14.2 times. By 2022, the IMF estimated that China’s GDP (in constant 2017 US dollars) was 18% larger than that of the US Additionally, China’s GDP per capita rose from 3.8% of the US level in 1990 to nearly 28% by 2022. Over this period, China has made significant advancements in high technology, skill development, innovation, and quality education, challenging both the US and the EU in these areas. 

Today, China represents 20% of the global population and produces one-sixth of global GDP. In comparison, the US, with 6% of the world’s population, generates one-fifth of total global output. When measured in purchasing power parity (PPP) terms, China’s share of global output stands at 19%, compared to 16% for the US and 15% for the EU, marking a substantial shift towards Asia in a single generation. Thirty years ago, China’s share of the global economy was a modest 5%, while the US and EU each represented 20% (IMF, 2024)  

China’s rapid economic rise and the relative decline of US and Western dominance have reshaped the global economic landscape. The shift of manufacturing to East Asia has boosted economic growth but also widened global inequalities. The legacy of colonialism and the ongoing disparities between the Global North and South highlight the complexities of today’s global economy. As emerging economies continue to grow and challenge traditional powers, the future of global economic leadership is uncertain, likely marked by challenges and potential conflicts. 

Following the September 11 attacks, the Bush administration’s decision to invade Afghanistan and Iraq marked a significant shift in US foreign policy. These military interventions, combined with domestic and global economic challenges, contributed to a gradual erosion of US economic dominance. The global financial crisis of 2008 further exacerbated these issues, resulting in lower investments and slower growth. The mainstream economists believed that a free-market system led by the US would ensure long-term prosperity.  

In 2024, the global economic landscape is defined by the following top five economies: The US remains the largest economy with a GDP of approximately $26 trillion (as shown in Table 1). Its economic growth rate was 2% in 2023. The US economy is diverse, with strong sectors in finance, manufacturing, technology, and services. The US dollar’s role as a global reserve currency enhances its international economic influence (Siddiqui, 2024b). The statistics underscores the significant shift in global economic power over recent decades (See Figure 1a and Figure 1b), particularly the rise of Asia as a dominant economic force and the evolving roles of established and emerging economies (IMF, 2024). 

China is the second-largest economy, with a GDP approaching $18.53 trillion in 2023 and an annual growth rate of 4.6%. China’s economic success is driven by its manufacturing sector, technological advancements, and a growing consumer market. China’s rise has significantly impacted global supply chains and international diplomacy (Siddiqui, 2024d). 

Germany, as the third-largest economy, excels in export-oriented industries such as engineering, automotive, chemicals, and pharmaceuticals. Known for its precision and quality, Germany leads in exporting automobiles, machinery, and chemicals, playing a crucial role in global trade. Japan, the fourth-largest economy, is characterized by its innovations and high technology. With a strong emphasis on research and development, Japan excels in high-tech industries including automotive, electronics, and robotics. Its annual GDP growth rate is 0.9% (Siddiqui, 2024c). 

India has emerged as the fifth-largest economy with a GDP exceeding $3.94 trillion in 2024. The country’s rapid economic advancement is driven by key sectors such as information technology, services, agriculture, and manufacturing. India benefits from a large domestic market, a skilled labour force, and a growing middle class.

Real GDP growth Annual Percent Change
Source: IMF, 2024.

Figure 1a: Real GDP growth Annual Percent Change. 

Shift of World Output Towards Asia, 1990-2024Figure 1b: Shift of World Output Towards Asia, 1990-2024.   

Rank  Country  GDP (trillion US$)  Annual Growth Rate (2023) 
US  $26.00  2% 
China  $18.53  4.6% 
Germany  $5.84  1.8% 
Japan  $5.19  0.9% 
India  $3.94  6.1% 
UK  $3.07  1.4% 
France  $3.32  1.6% 
Brazil  $2.28  2.3% 
Italy  $2.13  1.2% 
10  Canada  $2.10  2.0% 

Source: IMF data, July 1, 2024. 

Table 1: The Top Ten Largest Economies in the World in 2024 

It is estimated that world top economies will change. According to IMF (2024) study in 2050 Chinese economy will emerge as the top in terms of PPPs, followed by India, US, Indonesia, Brazil, Russia and so on (See Figure 2) This would mean these emerging economies share contribution to the world economy will greatly change (See Figure 3). All these economic changes will lead to change in their participation in international trade and their spending in R & D. Indeed, their struggle for greater power share in the world body and making rules to favour their economies and enhancing their position and influence on global sphere.   

World’s Top 10 Economies in 2050 as estimated by IMF, GDP at PPPs
Source: IMF, 2024.  

Figure 2: World’s Top 10 Economies in 2050 as estimated by IMF, GDP at PPPs.  

Share of World’s GDP (PPPs) Changes from 2016 to 2050, as estimated by IMF
Source: IMF, 2024. 

Figure 3: Share of World’s GDP (PPPs) Changes from 2016 to 2050, as estimated by IMF.  

Those developing countries that have proved most adept at learning, absorbing, using and enhancing such knowledge are in East Asia, China and South Asia. Asia including China has half of the world’s population. Moreover, Asia continues to be the world’s fastest-growing region. Region ability to learn and increase productivity is outstanding. It is clear from the past decades experience of economic expansion, the centre of gravity of the world economy is continuing to shift in the direction of these regions. As a result, it is expected that economic rise of the region will inevitably create political shifts. Indeed, it is already happening. For instance, China’s rapid economic rise is the big geopolitical fact of our era. In recent decades, China has become the worlds’ manufacturing hub and the largest investor in Africa. China has been recently involved in bringing Iran and Saudi Arabia in peace negotiations and reducing conflicts in Middle East. 

It is predicted that China, India, Indonesia and Turkey will account for the majority of the region’s expected GDP in 2050. The fastest growing economies in Asia during the 2050s will be India (more than 3.1 annual growth), and Bangladesh (3% annually). These countries are expected to thrive thanks to their high population growth rates and would be able to take advantage of larger workforce. Latin America will account for a relatively small 7% of global GDP in 2050.  

However, growth always does not mean expansion of employment. For example, we need to draw a distinction between “a mere increase in production” and “a large remuneration of labour”. A high GDP growth, it is argued, would raise the rate of growth of employment, which would reduce the relative size of the labour reserves, create tightness in the labour market, and raise the real wage rate. But, under neoliberal policy and free market regime, agriculture and petty producers are squeezed on the name of global competition. Therefore, the agricultural growth depends on the international market and to the consumption demands of the consumers in the rich countries. The employment in agriculture is getting reduced thanks to increased automatization and innovations. Even high rates of GDP growth under neo-liberal globalisation generate very little employment growth which is often referred to as “jobless growth”.  

With a worsening distribution of income, that is, a rise in the share of economic surplus, an ex- ante slowing down of the growth of aggregate demand relative to income growth becomes inevitable. The economist Mikhail Tugan-Baranovsky had contested this proposition by highlighting the possibility of a rise in investment growth to compensate for the decline in consumption growth. However, this is possible, but there is no reason to believe that investment under capitalism would change, since capitalists invest only when there are prospects of finding a market and expecting higher profits. The government can intervene to undermine the adverse impact of neoliberal policy, but the global finance opposes any move towards government control and to a larger fiscal deficit or higher taxes on the rich, which are the only means of financing larger government expenditure that would increase aggregate demand.  

VI. Conclusion 

From early colonialism to modern capitalism, economic growth among colonizers has often occurred at the expense of other nations. Colonizers violently occupied foreign lands, creating an artificially cheap supply of resources from their colonies and semi-colonies. While these processes generated significant wealth and economic development in Europe and the United States, but they exacerbated poverty, hunger and economic inequality in the colonized regions, fostering tension and potential conflict (Siddiqui, 2022b). 

The structural inequalities in production, reproduction, and global finance continue to perpetuate the divide between the Global North and South. This stratification, deeply rooted in colonialism and slavery, has left lasting imprints. For instance, the average annual income in the Congo is $785 per capita, whereas in Belgium—the Congo’s former colonizer—it stands at $47,400 in 2023, according to World Bank data (World Bank, 2024). 

The study concludes that a significant economic and power shift is gradually taking place, with the Western economy facing steep decline. Many emerging countries are assuming larger roles in the global economy, warranting closer scrutiny of their rise. Notably, China’s re-emergence as a great power is unprecedented in both scale and speed, contributing significantly to the relative decline of US economic power.

About the Author

Dr. Kalim SiddiquiDr Kalim Siddiqui is an economist specialising in International Political Economy, Development Economics, International Trade, and International Economics. His work, which combines elements of international political economy and development economics, economic policy, economic history and international trade, often challenges prevailing orthodoxy about which policies promote overall development in less-developed countries. Kalim teaches international economics at the Department of Accounting, Finance and Economics, University of Huddersfield, UK. He has taught economics since 1989 at various universities in Norway and the UK. 

References 

  1. Fukuyama, F. (2021) “On the end of American hegemony”, Economist, 18th August, London.  
  2. IMF (2024) World Economic Outlook, International Monetary Fund, Washington DC. 
  3. Siddiqui, K. (2024a) “Palestine, Imperialism and the Settler Colonial Project”, World Financial Review, Feb-March, pp.16-32. 
  4. Siddiqui, K. (2024b) “Deepening Economic Crisis in the Advanced Capitalism”, World Financial Review, April-May, pp.28-38. 
  5. Siddiqui, K. (2024c) “Revisiting the Japan’s Economic Stagnation”. World Financial Review, Feb-March. 
  6. Siddiqui, K. (2024d) “The BRICS Expansion and the End of Western Economic and Geopolitical Dominance”, World Financial Review, November. pp.3-14. 
  7. Siddiqui, K. (2023a). “The New Cold War: Struggle for Global Domination” (Part 1 & Part 2) World Financial Review, June-August. 
  8. Siddiqui, K. (2023b) “Marxian Analysis of Capitalism and Crises”, International Critical Thought, 13(4):525-545. 
  9. Siddiqui, K. (2022a) “Ukraine-Russia War and the Impact on the Global Economy” World Financial Review, Nov-Dec, pp.22-35. 
  10. Siddiqui, K. (2022b) “Capitalism, Imperialism, and Crisis”, European Financial Review, June/July, pp.16-32. 
  11. Siddiqui, K. (2019). “The US Economy, Global Imbalances under Capitalism: A Critical Review” Istanbul Journal of Economics, 69(2):175-205. 
  12. Siddiqui, K. (2017). “Austerity as a Tool of Fiscal Consolidation: Theoretical and Empirical Perspective” (edi) S. Owsiak, Public Finance, and the New Economic Governance in the European Union, 116 – 166, Warsaw: Wydawnictwo Naukowe. 
  13. World Bank (2024) Global Economic Prospects, Washington DC.  

China’s Growth Miracle and Development Strategy Since the 1980s. 

China global insights

By Dr Kalim Siddiqui 

I. Introduction 

Over the past four decades, China has undergone a remarkable economic transformation, often called a “Growth Miracle.” In less than two generations, it has evolved from a low-income, agrarian society into a productive, manufacturing-driven, middle-income nation. During this period, improvements in income, education, and healthcare have been substantial. Since 1978, economic reforms have lifted hundreds of millions of Chinese citizens out of poverty, leading to a rapid enhancement in living standards—an achievement unparalleled in human history. The World Bank study (2013) estimates that these changes have moved over 800 million people out of poverty. 

This article provides an overview of China’s economic development since 1978, examining the political economy of its growth, its global implications, and the extent of its economic progress. Understanding China’s unique developmental path is especially critical for international business, given its rapid ascent as an industrial powerhouse and one of the world’s largest consumer markets, with significant impacts on the global economy. China’s modernization was orchestrated and supported by the Communist Party of China, distinguished by two notable aspects: First, unlike other developing economies, including Russia, China managed its transition from a planned to a mixed-market economy without substantial economic disruption, while maintaining high growth rates. Second, China’s gradual approach to deregulation has avoided the entrenched interest-group politics that have often hindered similar efforts elsewhere. (He and Wang, 2024) 

China’s pro-market reforms, initiated in 1978, included significant changes to agriculture and rural sectors, notably the de-collectivization of agriculture. The country opened to foreign investment, allowed individuals to start businesses, and lifted price controls in 1985. While these reforms were gradual, and privatization was limited to some state-owned industries, the government retained control over key strategic sectors. As regulations eased, market forces of supply and demand played a larger role in shaping the economy. (Siddiqui, 2015)  

These reforms attracted foreign investment and promoted international trade. The primary drivers of growth were large-scale capital investments—stemming from both foreign capital and domestic savings—and rapid productivity gains. These factors worked in tandem, as economic reforms enhanced efficiency, boosted output, and created resources for reinvestment. (Siddiqui, 2024) 

Mainstream economists highlight productivity gains (i.e., increased efficiency) as another major factor in China’s economic expansion. Productivity improvements were achieved largely through reallocating resources to more productive uses, especially in sectors previously under strict government control, such as agriculture and trade. Rural reforms increased agricultural output, enabling many farmers to migrate to cities, where they found better opportunities in manufacturing. Decentralization encouraged private enterprises and individuals to pursue new opportunities outside the state sector. Additionally, exposure to competitive forces in the export sector and foreign investment introduced new technologies and management practices, significantly enhancing efficiency. 

II. Modernization and Global Capitalism 

Modernization, in recent history, often refers to the transformation of a society from an agrarian base to a technologically advanced, industrialized economy with high productivity. Under capitalism, this process began with Britain’s Industrial Revolution in the late 18th century, when capitalists hired wage labour to produce goods and services. Over time, these industries evolved into large-scale mechanized enterprises, producing goods for broader markets. Driven by the capitalist imperative to control resources and expand markets, improvements in transportation and communication helped broaden trade networks and stimulate global trade. However, the worldwide expansion of capitalism has not always yielded positive outcomes for all communities. (Siddiqui, 2020a) 

Britain’s path to industrialization, for instance, relied heavily on exploiting its colonies, from which it accumulated “surplus” wealth to reinvest in its own industries. While capitalism has undeniably led to the development of modern infrastructure and expanded markets, it has also been linked to widespread poverty, crime, and even slavery. The bourgeoisie, or capitalist class, has historically exploited workers while amassing considerable profits. Beyond the core capitalist countries, the pursuit of raw materials and markets for surplus goods often turned many regions into colonies or semi-colonies, frequently through coercion, reducing these areas to targets of exploitation and control. 

Historically, China, too, endured foreign military interventions that led to significant political and social upheaval during the late Qing dynasty. European powers, along with Russia and Japan, seized Chinese territories, subjecting the country to what is now known as the “Century of Humiliation” (1839–1949). This period began with Britain’s invasion of China in 1839 to open Chinese ports for the opium trade, marking the start of the First Opium War (1839–1842). This conflict stemmed from the illegal opium trade, which had escalated sharply since the 1820s. The Second Opium War (1856–1860) saw British and French forces invade China again, culminating in the plundering and burning of Beijing’s Summer Palace in 1860. Japan also attacked China in the 1910s and again in the 1930s, occupying large portions of Chinese territory. These interventions triggered widespread civil strife and suffering within China throughout the 19th century, resulting in the deaths of tens of millions of Chinese people. (Siddiqui, 2020b) 

III. Opening of China’s Market to Foreign Investors 

In the mid-1970s, Western economies faced stagflation, partly due to declining profit rates as former colonies gained independence, driving up raw material prices and reducing profit margins. The opening of China’s market offered Western economies an opportunity to export capital and technology to a low-wage economy, with hopes of restoring profitability. Additionally, during the 1980s, the United States grappled with a balance of payments crisis, exacerbated by Japan’s high productivity growth and export boom. In response, the U.S. pressured Japan to sign the Plaza Accord in 1985, which led to a significant appreciation of the yen. This shift incentivized Japanese companies to invest and produce overseas, particularly in China. (Siddiqui, 2009a) 

When the Communist Party came to power in 1949, China was one of the world’s poorest nations, plagued by widespread illiteracy, poverty, and malnutrition. Soon after, the government enacted radical land reforms, dismantling land monopolies and fostering rural equality, which led to an increase in agricultural output. Compulsory primary education and rural healthcare initiatives were also introduced, laying the groundwork for China’s modernization. In 1978, under the leadership of Deng Xiaoping, China began gradually opening its economy to foreign investment, marking the start of a new era of economic transformation. (He and Wang, 2024) 

IV. Industrialization in China 

In its early stages of industrialization, China imposed high tariffs on imports, recognizing this as a necessary step to foster its nascent industries. However, these high tariffs were kept in place only temporarily—not to protect weak or uncompetitive companies but to attract foreign industries and technology to China. The aim was to create favourable conditions for technology transfer and modernization. (He and Wang, 2024) This policy of encouraging domestic industries to modernize and become internationally competitive, even after tariffs were removed, has been one of China’s most effective industrial strategies in recent times. (Jian and Nie, 2024) 

During the height of the Cold War, as the United States sought to counterbalance the Soviet Union, Henry Kissinger made a secret visit to Beijing in 1971, paving the way for President Nixon’s historic visit in 1972. These groundbreaking diplomatic efforts encouraged China to gradually open its markets to foreign capital and trade. In doing so, China negotiated favourable terms with foreign corporations, gaining access to advanced technology and business expertise. The United States further solidified this economic opening by granting China most-favoured-nation status in 1980, spurring a significant surge in capital inflows and exports (See Figures 1 and 2). (Siddiqui, 2019a) 

The influx of foreign capital enabled China to rapidly accumulate capital, which allowed the country to establish a modern industrial base in a relatively short period. (UNCTAD, 2023) The Chinese government actively promoted foreign investment in manufacturing. As Yu (2024:42) notes, “The Chinese government has implemented policies to support domestic capital, welcome foreign investment, and commit to restoring intellectual property rights in international trade negotiations, despite their monopolistic nature. At the same time, the government has not reinstated private land ownership or permitted landlords to reclaim authority. Public ownership remains central to the economy, with the state-owned sector playing a leading role in policy implementation, thereby providing stability and regulatory oversight in domestic economic development.” 

Figure 1
Source: UNCTAD, 2023.

Figure 1: Foreign Capital Inflows into China between 1990 and 2022. 

Figure 2
Source: World Bank, national accounts data, 2023; OECD, 2023. 

Figure 2: China’s Exports of Goods and Services (% of GDP), 1960-2023. 

V. China’s Economic Resilience and High Savings Rate 

When the 1997 financial crisis struck East Asian economies, China remained largely insulated, thanks to its relatively closed financial sector. This insulation helped China maintain economic stability, enabling both domestic and foreign businesses to expand their global market share, while other East Asian countries faced economic setbacks and scaled back from international markets. (Siddiqui, 2009b) 

Historically, China has maintained a high savings rate. When economic reforms began in 1978, domestic savings represented 32% of GDP, much of which stemmed from the profits of State-Owned Enterprises (SOEs). These savings were directed by the central government into domestic investments. Subsequent reforms, including the decentralization of production, boosted household and corporate savings, sustaining China’s high domestic investment levels. 

Between 1980 and 2010, China’s domestic savings rose steadily, supporting an exceptionally high savings rate (see Figure 3), which the government channelled into investments—particularly after the 2008 global financial crisis. As global demand declined and exports faltered, China pivoted inward, focusing on domestic investments to stimulate employment. (Siddiqui, 2009c) It is projected that China’s average investment growth will remain around 10%, with private consumption growth at 9%, government expenditure growth at 12%, and net exports growth at -1%. By 2023, following gradual structural changes, China’s GDP composition was expected to be approximately 40% investment, 42% private consumption, 15% government expenditure, and 3% net exports. (Wolf, 2023) 

Figure 3
Source: IMF

Figure 3: China’s Investments and Savings as a % of GDP, 1980-2028. 

Figure 4
Source: IMF

Figure 4: Gross Saving Rate of the World’s Major Economies as a % of GDP in 2023. 

In 2023, China’s share stood at about 18.75%. China also maintains the world’s highest gross savings rate (see Figure 4), which peaked at 52% of GDP in 2008. Even in 2019, when COVID-19 struck, China’s gross savings rate remained robust at 44%, with nearly a fifth of these substantial savings contributing to the current account surplus.  

VI. China’s Remarkable Economic Transformation and Future Challenges 

According to World Bank data, the percentage of Chinese people living below the poverty line dropped from 80% in 1978 to just 9% by 2013. While China’s per capita GDP was comparable to India’s in 1978, it had risen to more than five times higher than India’s by 2022. Over the last 44 years, an unprecedented number of Chinese citizens have witnessed substantial improvements in living conditions. To eradicate poverty by 2021, the Chinese government launched targeted initiatives in 2014, identifying 100 million people below the poverty line and implementing programs to improve their incomes. (World Bank, 2024) 

China’s average life expectancy in 1978 was 64 years—remarkable compared to India’s 51 years, although still lower than the U.S. at 73 years. By 2023, life expectancy had risen to 77 years in both China and the U.S. China’s infant mortality rate also dropped significantly, from 37 deaths per 1,000 live births in 1978 to just 5.4 per 1,000 in 2023, surpassing the U.S. rate of 5.7 per 1,000. China experienced an unprecedented period of steady growth over four decades, culminating in substantial gains in per capita income (See Figure 5). (Wolf, 2023) 

However, sustaining rapid economic growth is becoming increasingly challenging. China currently accounts for 15% of global exports, and, as noted in a World Bank report, its dominance in various sectors may face resistance from trading partners. To mitigate a potential medium-term growth slowdown, China will need to focus on economic diversification and expanding its domestic market. (World Bank, 2024) 

Figure 5
Source: https://www.statista.com/statistics/263775/gross-domestic-product-gdp-per-capita-in-china/ 

Figure 5: China’s Gross Domestic Product (GDP) Per Capita at current prices, 1985-2029. 

Figure 6
Source: The 2000–2022 data were obtained from China Statistical Yearbook 2023.

Figure 6. China’s Economic Growth in the 21st Century, 2000–2023. 

Figure 7
Source: World Bank database

Figure 7. Comparison of Economic Aggregates of China and the United States in the 21st Century, 2000–2023. 

Table 1

Table 1: The GDP Growth of the Chinese and US (in trillions of US$) between 2014 and 2023.  

China’s economic growth has been remarkable, reaching a peak of 14.2% in 2007. Although the global economy was later disrupted by the COVID-19 pandemic, China’s growth rate remained consistently faster than that of the United States, as illustrated in Figures 6 and 7. Today, China plays a pivotal role in the global economy, contributing over 10% of international trade, approximately 18% of global GDP (at market exchange rates), around 16% of world oil demand, and more than a quarter of the world’s broad money supply. 

Despite both the U.S. and China experiencing GDP growth, China’s rate has been significantly higher (see Table 1). The Figure 7 indicates China’s share in global GDP, adjusted for purchasing-power-parity, up to 2023, with projections through 2029. (World Bank, 2024) This rapid expansion has substantially increased China’s share of global output, propelling the country to middle-income status. Alongside economic growth, China has made significant strides in education, healthcare, social welfare, housing, and overall living standards. 

VII. Conclusion 

China’s economic transformation began in 1978 with reforms in the agricultural sector, incentivizing rural households to boost agricultural output. These reforms later expanded to the urban industrial sector, introducing policies like the dual-price system, which reduced supply shortages, and opening select sectors to private businesses in a competitive, market-led environment. The Communist Party initiated these pro-market reforms, gradually expanding foreign investment opportunities across sectors. By liberalizing trade in the 1980s and welcoming foreign capital, technology, and access to Western markets, China leveraged its vast labour resources for rapid economic growth. This shift to an open-door policy marked the beginning of China’s era of high growth. 

A crucial aspect of China’s rise has been its impressive trade expansion. Since 1980, China’s exports and imports have grown at an annual rate of 15%, outpacing the global average of 7%. For instance, trade with the U.S. surged from $5 billion in 1980 to $670 billion in 2022, making China the U.S.’s largest merchandise trading partner and its largest source of imports. (World Bank, 2024) Many U.S. companies have operations in China, benefiting from its competitive labour costs and access to its booming market. China’s remarkable growth from 1978 to 2010, averaging around 10% annually, has indeed justified the “Chinese economic miracle.” As a key driver of global growth, China has contributed nearly a third of worldwide growth over the past four decades. Policies of “reform and opening up” have gradually integrated China into the global economy, with the country’s competitive wages, infrastructure, and government support policy playing a crucial role. Additionally, China’s entry into the WTO in 2001 facilitated global market access and accelerated technology transfer. 

China’s rise from a developing nation to a global economic power in just four decades is remarkable. From 1980 to 2018, its GDP grew at an average annual rate of over 10%. The World Bank study (2024) highlights China’s “fastest sustained expansion by a major economy in history,” which has lifted over 800 million people out of poverty. Today, China is the world’s top economy in purchasing power parity (PPP) terms and leads in value-added manufacturing, merchandise trade, and foreign exchange reserves. 

Since the 1990s, China’s growth, averaging over 9% annually, has garnered extensive interest from economists. By 2010, China became the world’s second-largest economy by nominal GDP, and by 2016, it surpassed the U.S. in GDP (PPP). Over this period, nearly 800 million people have been lifted out of poverty, with significant improvements in healthcare, education, and social services. 

Yet, China’s rise has raised concerns in the U.S., with accusations of unfair trade practices, currency undervaluation, subsidies to Chinese producers, and inadequate protection of intellectual property rights (IPR) that allegedly impact American jobs and competitiveness in IP-intensive industries. In response, the U.S. has recently implemented high-tech restrictions to curb China’s economic rise. (Siddiqui, 2018) 

China has become a prominent global player, especially in infrastructure and economic policy. Its Belt and Road Initiative (BRI) is an ambitious project financing infrastructure across Asia, Europe, Africa, and beyond. If successful, the BRI could significantly expand China’s influence, especially in the Global South, and create new markets for Chinese exports and investments. (Siddiqui, 2019b) 

Looking forward, China faces several challenges that could hinder its future growth, including its heavy reliance on fixed investment and exports, a weak banking sector, widening income disparities, and significant environmental concerns. Expanding social safety nets, promoting cleaner industries, and curbing official corruption are critical reforms that could sustain China’s growth trajectory. The success of these reforms will likely determine whether China can maintain its rapid growth or face a gradual slowdown.

About the Author

Dr. Kalim SiddiquiDr Kalim Siddiqui is an economist specialising in International Political Economy, Development Economics, International Trade, and International Economics. His work, which combines elements of international political economy and development economics, economic policy, economic history and international trade, often challenges prevailing orthodoxy about which policies promote overall development in less-developed countries. Kalim teaches international economics at the Department of Accounting, Finance and Economics, University of Huddersfield, UK. He has taught economics since 1989 at various universities in Norway and the UK. 

References 

  1. He, Z. and Wang, C. (2024) “Understanding the Unique Characteristics and Essential Requirements of Chinese Modernization” International Critical Thought, 14(1):1-17. 
  2. Jian, X. and Nie, C. (2024) “Clarifying Several Misjudgements regarding China’s Economic Trends” World Review of Political Economy, 15(2):166-184. 
  3. Siddiqui, K. (2024) “China’s Trade and Growing Economic Influence with East Asia” World Financial Review, April-May, pp.2-14. 
  4. Siddiqui, K. (2020a). “A Comparative Political Economy of China and India: A Critical Review” (edi.) Young-Chan Kim. China-India Relations: Geo-Political Competition, and Economic Cooperation, pp.31-58, Switzerland:  Springer. 
  5. Siddiqui, K. (2020b) “Britain’s Trade with China in the Eighteenth and Nineteenth Century: A Review of the Opium Wars” Asian Profile, 48(3):206-221, September. 
  6. Siddiqui, K. (2019a). “The US Economy, Global Imbalances under Capitalism: A Critical Review” Istanbul Journal of Economics 69(2): 175 – 205, December. 
  7. Siddiqui, K. (2019b) “One Belt and One Road, China’s Massive Infrastructure Project to Boost Trade and Economy: An Overview” International Critical Thought. 9(2):214 – 235. 
  8. Siddiqui, K. (2018) “U.S. – China Trade War: The Reasons Behind and its Impact on the Global Economy” World Financial Review, November-December, p.62 – 68. 
  9. Siddiqui, K. (2015). “Perils and Challenges of Chinese Economic Development” International Journal of Social and Economic Research, 5 (1):1-56.  
  10. Siddiqui, K. (2009a). “Japan’s Economic Crisis” Research in Applied Economics, 1(1):1-25.  
  11. Siddiqui, K. (2009b) “The Current Financial Crisis and its Impact on the Emerging Economies: China and India” Research in Applied Economics, 1(2):1-28.   
  12. Siddiqui, K. (2009c) “The Political Economy of Growth in China and India” Journal of Asian Public Policy 1(2):17-35. 
  13. UNCTAD (2023) World Investment Report – global foreign direct investment (FDI), https://unctad.org/data-visualization/global-foreign-direct-investment-flows-over-last-30-years 
  14. Wolf, M. (2023) “How China can avoid Japan Trap” Financial Times, 26/9/23, London. https://www.ft.com/content/156c092a-4313-48cc-8103-79bb26c0faaa 
  15. World Bank (2024) National Accounts Data, https://data.worldbank.org/indicator/NE.EXP.GNFS.ZS?locations=CN 
  16. World Bank (2013) China at 2030: Building a Modern, harmonious, and Creative society. https://www.worldbank.org/content/dam/Worldbank/document/China-2030-complete.pdf 
  17. Yu, B. (2024) “A Political Economy Analysis of Chinese Modernization” International Critical Thought, 14(1):34-47. 

Trump Appoints Massad Boulos as Middle East Adviser

middle east and US

President-elect Donald Trump on Sunday named Lebanese American businessman Massad Boulos as his senior adviser on Arab and Middle Eastern affairs. Boulos, father-in-law of Trump’s daughter Tiffany, played a key role in securing Arab and Muslim American support during the campaign, particularly in Michigan, where Trump won a narrow victory.

Boulos’ deep ties to Lebanon’s political factions, including Hezbollah allies and opponents, as well as his outreach to Arab American leaders, position him to influence Trump’s Middle East policies. Analysts note his ability to navigate Lebanon’s political complexities, but his connections could spark controversy.

The announcement follows Trump’s decision to appoint Charles Kushner, father of his son-in-law Jared, as U.S. ambassador to France.

Lebanese observers expressed cautious optimism, hoping Boulos might advocate for policies benefiting Lebanon’s fragile economy and politics. “We’re optimistic,” said Hamdi Hawallah, a retiree. “It’s a rare opportunity.”  

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Dubai’s Sustainable Investment Scene is Booming — It’s Time European Investors Joined the Party 

By Dr. David von Rosen

Once a haven for oil and defense investing, Dubai has since shaken off the shackles of its old reputation and emerged as a leading location for green investment opportunities.   

In the US and throughout Europe, green investors are walking on shaky ground. The future of ESG in the US is more uncertain than ever, with Donald Trump set to return to the White House. In Europe, aspirations seem to outweigh capability, with EU Member States lagging behind international competitors when it comes to sustainable innovation and green technologies (European Commission).  

It’s a different story in Dubai. From sustainable construction practices to the development of green technology, responsible and sustainable opportunities are thriving.   

But too many European investors are stuck on the idea that Dubai has nothing to offer the eco-driven investor. And in the fast-paced, competitive world of private investment, their continued hesitancy is putting them at risk of missing out on key responsible investment opportunities in the Emirati city. 

It’s time European investors set aside their outdated conceptions about Dubai, and double their investments in the city’s exciting sustainable opportunities. 

It’s no secret that Dubai is a haven for international investors. With an economy that’s going from strength to strength, Dubai has earned itself a reputation as a hotbed for innovative, future-proof investment opportunities – many promising strong prospective returns. The real estate industry in particular is white hot, with a frenzy of international investors all clamoring to cash in. 

Dubai’s investor-friendly atmosphere makes the prospects of investing in the city that bit sweeter. From zero taxes on capital gains and rental income, to the investor-friendly FDI regulations, Dubai is committed to adapting and evolving into an international hub for foreign investment. It’s a stark contrast to the high tax rates and sense of stifled innovation that courses through Europe (Sifted).   

With Dubai’s ongoing property boom (Economy Middle East), and government-led initiatives designed to stimulate and encourage growth, the UAE economy is forecasted to grow by 4.8% in 2025 (ZAWYA). It’s time European investors double their current investments in Dubai and cash in on its glimmering future – or risk being beaten to the chase by competitive, opportunity-hungry investors from around the globe.  

Investment opportunities in Dubai’s leading industries aren’t merely profitable – they’re governed by sustainability targets and environmentally responsible regulations. 

One of Dubai’s most promising, future-focused sectors is its green tech industry. As the United Arab Emirates has made the transition away from oil dependence, Dubai has chiseled itself out a nice spot in the global renewable energy sector.  

Its status has been boosted in part by the city’s clean energy strategy, which aims to convert Dubai into a global clean energy hub by 2050. In the process, Dubai has visions to construct a state-of-the-art innovation center, where all clean energy R&D efforts will be housed (Invest in Dubai). With over $12 billion already invested in renewable energy nationwide (Fast Company), the UAE’s market is expected to register a compound annual growth of around 8% between 2024 and 2029 (Mordor Intelligence). 

Dubai’s mission to find viable alternatives to oil and fossil fuels has seen the city transform into a hotbed for exciting ‘cleantech’ startups, opening up a realm of opportunities for foreign investors. 

It’s a striking contrast to the current climate in Europe, where aspirations for a world-leading green tech sector are being put to rest by an ongoing decline in manufacturing capacity. With high production costs driving out firms, cleantech companies are relocating elsewhere (European Commission), and for many of these firms, Dubai has proven an especially inviting location (Sifted). And that’s without mentioning president-elect Donald Trump’s proposed tariffs for European imports (LSE), which is adding fuel to the fire of corporate Europe’s fears. 

Alongside the pivot to clean energy and its work on tech-driven climate solutions, the city has begun to place an emphasis on sustainable infrastructure. Through the Dubai 2040 Urban Master Plan, responsible investment opportunities have opened up throughout Dubai’s construction and real estate sectors.   

Foreign investment opportunities in Dubai meld responsible principles with real, tangential benefits. Dubai has a lot to offer investors. It promises profitable and future-focused investment opportunities, governed by sustainable practices; but it equally promises an investor-friendly environment, with regulations that both enable and encourage investment and entrepreneurship.  

With a promising future of growth and innovation as wind in their sails, it’s time European investors move on from the beaten ground of Europe and the US and look towards the promising shores of Dubai. With its economy-defining industries and innovative, sustainability-driven sectors, the city packed full of opportunities that are waiting to be explored by European investors.

About the Author

David von RosenDr. David von Rosen is an international investor and entrepreneur. Through the VONROSEN family office, he invests in businesses across the world with a particular focus on renewable energy, gaming, nutrition and technology. He has also founded and scaled several businesses, including lottery platform Lottoland, super-prime property developer 25 Degrees and fashion label VONROSEN.    

He was born and raised in Germany and currently splits his time between Dubai and Switzerland. He studied economics and business at the European Business School and later gained a PhD in Economics from the University of Economics in Prague in 2007. 

The Evolving Role of CIOs in Managing Digital Employee Experience

By Dr. Gleb Tsipursky

In today’s fast-paced digital workplace, the success of any organization hinges on more than just advanced technology and streamlined operations. As Bob Grazioli, CIO of Ivanti, reveals in an interview with me, the concept of Digital Employee Experience (DEX) is reshaping the role of CIOs and influencing productivity, cybersecurity, retention, and organizational culture. DEX is how employees interact with their organization’s digital environment. This encompasses the hardware and software they use to perform their daily tasks, as well as the level of access and support they receive. From understanding employee frustrations with tech tools to using AI to elevate digital experiences, Grazioli shares insights from Ivanti’s latest research on DEX, highlighting the imperative for CIOs to manage DEX effectively and strategically.

The Challenges and Importance of Managing DEX

For CIOs, managing DEX is both a necessity and a formidable challenge. DEX isn’t simply about having functioning technology; it’s about creating a seamless, frustration-free digital environment that supports productivity and satisfaction. Grazioli notes that the stakes are high: “Our research shows that 55% of office workers report that poor digital experiences impact their overall mood and morale,” he says. This correlation between overall employee experience and DEX means that poor technology experiences can erode not only productivity but also retention and overall job satisfaction.

By establishing a clear, data-backed connection between DEX improvements and business outcomes, CIOs can demonstrate that DEX is not just an operational concern but a driver of business performance.

However, creating a cohesive understanding of DEX data is difficult. Organizations frequently lack the metrics to quantify and improve DEX, which hinders CIOs from advocating for necessary investments. “CIOs need to track DEX metrics effectively to prove the value of investments in this area,” Grazioli explains. By establishing a clear, data-backed connection between DEX improvements and business outcomes, CIOs can demonstrate that DEX is not just an operational concern but a driver of business performance.

DEX and Cybersecurity: A Strategic Connection

One of the lesser-discussed benefits of improving DEX lies in its ability to strengthen cybersecurity. Frustrated employees often resort to risky workarounds to bypass cumbersome security practices or inefficient tools. According to Ivanti’s research, 61% of employees have used unsafe shortcuts at work due to dissatisfaction with their tech tools. Grazioli notes that this behavior introduces critical security risks, as employees bypass secure protocols in favor of ease of access.

To combat this, 93% of security professionals surveyed by Ivanti agree that prioritizing DEX positively impacts an organization’s cybersecurity posture. By addressing the underlying causes of frustration, CIOs can help reduce risky behavior, thereby fortifying cybersecurity defenses. “DEX isn’t just a productivity tool; it’s a security measure,” Grazioli emphasizes, pointing out that by providing tools that are user-friendly and efficient, CIOs can help mitigate these risks and protect sensitive data.

Overcoming Skepticism Within IT Teams

While leadership may recognize the importance of DEX, Grazioli points out that IT teams are often skeptical of its benefits. “Our research shows that 60% of IT workers view DEX as just a buzzword,” he explains. This skepticism stems from a combination of high workloads, the demands of hybrid work, and a perception that DEX doesn’t translate into practical improvements for the IT department itself.

To counter this, CIOs can take concrete steps to ensure IT workers have the tools they need to succeed, especially in remote settings. Currently, 23% of remote IT workers report that their tools are less effective when working outside the office. By improving DEX for IT professionals, CIOs can create a more supportive environment, reducing burnout and helping IT staff see the practical benefits of DEX. Grazioli highlights the potential of AI to support this shift, explaining, “Integrating DEX with AI allows employees to proactively address minor tech issues on their own, freeing up IT’s time for high-value work.”

Elevating the Role of CIOs Through DEX

For CIOs, managing DEX can be a career-defining responsibility that positions them as strategic leaders within their organizations. Ivanti’s research reveals that 75% of executives believe that strong DEX management can elevate the CIO role, as DEX impacts key performance indicators such as retention, productivity, and employee satisfaction. Grazioli explains that by automating processes, anticipating potential issues, and proactively resolving tech obstacles, CIOs can play a visible role in enhancing the employee experience and driving productivity.

High-quality DEX isn’t just an operational efficiency; it’s a contributor to talent retention and job satisfaction. Ivanti’s data shows that 90% of leadership-level executives recognize the role of DEX in improving employee retention, while 97% see its positive impact on productivity. For CIOs, this means that effectively managing DEX can help secure their position as a central figure in strategic business discussions, demonstrating how technology investments directly impact organizational goals.

Addressing Budget and Resource Barriers to DEX

Although DEX is highly valued, Ivanti’s report identifies cost and budget as major barriers. Despite 65% of executives indicating that DEX budgets are increasing, only 49% of IT teams currently use DEX management tools. Grazioli explains that many organizations struggle with aligning their budget priorities to include comprehensive DEX solutions. Without the right tools in place to measure and track DEX performance, CIOs face significant challenges in justifying these investments to other organizational leaders. “The lack of access to key metrics, such as DEX scores and device analytics, makes it difficult for CIOs to demonstrate the value of DEX and secure the necessary resources,” Grazioli notes. He suggests that organizations can overcome these challenges by investing in DEX management tools that provide actionable insights into employee technology experiences. By tracking the right metrics and understanding the data, CIOs can make a stronger case for continued investment in DEX and its impact on business outcomes.

How DEX Drives Productivity, Security, and Retention

The connection between DEX and productivity is undeniable. Grazioli highlights the fact that 60% of office workers report frustration with their tech tools, which can significantly impact their work efficiency. Slowdowns, technical glitches, and inefficient tools not only reduce productivity but also decrease morale. Ivanti’s research shows that nearly 100% of leadership executives agree that improving DEX enhances productivity and job satisfaction. By providing employees with the right tools and ensuring that their technology is functioning optimally, CIOs can help mitigate these frustrations and increase overall workplace efficiency.

DEX also plays a key role in reducing security risks. When employees are dissatisfied with their tech tools, they may bypass security protocols in favor of quicker, more convenient solutions. Ivanti’s research reveals that 61% of employees admit to using unsafe shortcuts in their workflows. By improving DEX, organizations can reduce these security risks by ensuring that employees have tools that work well and meet security standards. A seamless digital experience can help minimize the temptation to take shortcuts, ultimately improving cybersecurity posture across the organization.

In addition to enhancing productivity and reducing security risks, DEX is also critical for attracting and retaining top talent. Grazioli emphasizes the importance of addressing the technology needs of IT teams, as they are responsible for implementing and managing DEX initiatives across the organization. IT workers are often overwhelmed with the demands of hybrid work and may experience burnout due to inefficient tools. By prioritizing DEX for IT teams, CIOs can help improve employee satisfaction and reduce turnover, ultimately supporting the organization’s long-term success.

The Future of DEX: AI and Consolidation

Looking ahead, Grazioli envisions a future where DEX and AI converge to revolutionize IT workflows and reduce burnout. “AI-powered DEX solutions will transform how organizations manage employee experiences,” he predicts. By leveraging AI, organizations can proactively address tech issues before they affect employees, freeing up IT teams to focus on more strategic tasks. Additionally, AI can provide valuable insights into employee technology experiences, helping organizations make data-driven decisions to improve digital workflows.

As organizations continue to implement DEX strategies, Grazioli also sees a growing need for consolidating fragmented IT tech stacks. Without a streamlined, unified tech environment, organizations will struggle to gain meaningful insights into how employees interact with their digital tools. By consolidating their tech stacks and ensuring that DEX tools work seamlessly together, organizations can gain a clearer view of employee experiences and make more informed decisions.

Furthermore, Grazioli suggests that Chief Information Security Officers (CISOs) will play an increasingly important role in DEX strategy moving forward. “CISOs will need to be closely involved in DEX initiatives, ensuring that security considerations are embedded within digital experiences,” he explains. By working together, CIOs and CISOs can create a more secure and efficient digital workplace, where technology works for employees rather than against them.

The Impact of Cognitive Biases on DEX Strategy

In developing and implementing a Digital Employee Experience (DEX) strategy, CIOs must navigate several cognitive biases that can cloud judgment and lead to ineffective decision-making. Two cognitive biases particularly relevant in this context are status quo bias and optimism bias, each of which can subtly undermine DEX initiatives and impede meaningful change.

Status Quo Bias—the tendency to prefer current states and resist change—can significantly hinder the adoption of new DEX solutions. This bias is often seen within IT teams and among leadership, who may prefer existing systems and processes, even if these are not optimal for the organization. Given the already high demands of hybrid work, many IT professionals may feel hesitant to embrace new DEX tools, viewing them as yet another addition to an already complex tech landscape. Status quo bias can lead to a reluctance to invest in new DEX technologies that could ultimately reduce employee frustrations, boost productivity, and ease IT workloads. To counteract this bias, CIOs should present compelling, data-backed evidence that illustrates how specific DEX improvements address current pain points, making it clear that the potential benefits outweigh the comfort of the familiar.

Optimism Bias—the tendency to overestimate positive outcomes and overlook potential risks—can also play a role in shaping DEX strategies, especially in terms of cybersecurity. Leaders with optimism bias might underestimate the consequences of employee frustration with technology or believe that employees will naturally adhere to security protocols. However, research shows that 61% of employees have taken unsafe shortcuts to circumvent inefficient tools, which poses a significant security risk. Optimism bias may also lead leaders to assume that employees are generally content with existing technology, missing early signs of dissatisfaction or disengagement that could impact retention. CIOs who are aware of this bias can adopt a more realistic, data-driven approach to DEX, using employee feedback and technology usage data to gauge true satisfaction and identify areas for improvement.

Managing Digital Employee Experience is no longer a luxury or a “nice-to-have” for CIOs—it is a mission-critical component of business success.

By acknowledging these cognitive biases, CIOs can foster a more objective, flexible approach to DEX. Addressing status quo and optimism biases not only paves the way for better technology adoption and security practices but also enables CIOs to implement DEX strategies that more accurately reflect the needs of their employees, boosting both satisfaction and productivity.

Conclusion: DEX as a Strategic Imperative for CIOs

Managing Digital Employee Experience is no longer a luxury or a “nice-to-have” for CIOs—it is a mission-critical component of business success.

As Bob Grazioli highlights, a seamless and effective DEX strategy can have far-reaching implications for productivity, employee satisfaction, cybersecurity, and retention. CIOs who prioritize DEX not only enhance the work experience for their employees but also elevate their role within the organization as strategic leaders.

However, the journey to successful DEX management is not without its challenges. Overcoming skepticism from IT teams, navigating budgetary constraints, and addressing the complexities of managing multiple tech tools require a thoughtful and proactive approach. As AI and other innovative technologies continue to shape the future of work, CIOs must remain agile and committed to enhancing the employee experience through the right combination of technology, data, and strategic leadership.

In the years to come, the organizations that effectively manage DEX will not only improve their internal operations but will also set themselves apart in a competitive talent market. By focusing on the digital experiences that shape employees’ day-to-day work lives, CIOs can drive long-term success and position their organizations for continued growth and innovation.

About the Author

Dr. Gleb TsipurskyDr. Gleb Tsipursky was named “Office Whisperer” by The New York Times for helping leaders overcome frustrations with hybrid work and Generative AI. He serves as the CEO of the future-of-work consultancy Disaster Avoidance Experts. Dr. Gleb wrote seven best-selling books, and his two most recent ones are Returning to the Office and Leading Hybrid and Remote Teams and ChatGPT for Thought Leaders and Content Creators: Unlocking the Potential of Generative AI for Innovative and Effective Content Creation. His cutting-edge thought leadership was featured in over 650 articles and 550 interviews in Harvard Business Review, Inc. Magazine, USA Today, CBS News, Fox News, Time, Business Insider, Fortune, The New York Times, and elsewhere. His writing was translated into Chinese, Spanish, Russian, Polish, Korean, French, Vietnamese, German, and other languages. His expertise comes from over 20 years of consulting, coaching, and speaking and training for Fortune 500 companies from Aflac to Xerox. It also comes from over 15 years in academia as a behavioral scientist, with 8 years as a lecturer at UNC-Chapel Hill and 7 years as a professor at Ohio State. A proud Ukrainian American, Dr. Gleb lives in Columbus, Ohio.

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