The Economist - Can anyone stop Narendra Modi? Part 4

Investment in Cuba: Strait talk Elections in Quebec: The s-word Scandal in Mexico: A trashy tale Bello: A political FUTbol Investment in Cuba Strait talk As Cuba eases investment rules, many Cuban-Americans turn against the embargo Apr 5th 2014 | MIAMI | From the print edition AT THE outset of Tom Wolfe's latest novel, "Back to Blood", the muscled hero, a 25-year-old Cuban-American cop called Nestor Camacho, seethes when his fat and disdainful Americano (Anglo) colleagues stereotype him as a Cuban. He has never set eyes on the island, he says. His Spanish is poor. At home, his parents' hatred of Fidel Castro flies over his head. His world revolves around Miami, not Cuba.

Unsurprisingly, the book is not universally liked in Miami (it skewers everyone, from Anglos to Cubans to Haitians to Russians). But in at least one respect it is spot on. Younger Cuban-Americans are less obsessed with Cuba than their exiled elders. Like other Americans, pollsters say, they now think more pragmatically; Cuba is not the only voting issue that they care about.

In fact, they are more likely to be pouring money into Cuba than shunning it. Remittances, as well as travel, have risen since President Barack Obama eased restrictions in 2009 and 2011 (see chart). Much of the money has found its way into restaurants (known as paladares), hairdressers or other small businesses run by relatives in Cuba. That has given Cuban-Americans an increasing, albeit hidden, stake in the island's economic future.

The laws of both the United States and Cuba have forbidden such money to be treated as investment. But on March 29th Cuba's parliament approved a new foreign-investment law that for the first time allows Cubans living abroad to invest in some enterprises (provided, according to Rodrigo Malmierca, the foreign-trade minister, they are not part of the "Miami terrorist mafia"). The aim is to raise foreign investment in Cuba to about $2.5 billion a year; currently Cuban economists say the stock is $5 billion at most.

The law, which updates a faulty 1995 one, is still patchy, says Pavel Vidal, a Cuban economist living in Colombia. It offers generous tax breaks of eight years for new investments. However, it requires employers to hire workers via state employment agencies that charge (and keep) hard currency, vastly inflating the cost of labour. It enhances the right to establish fully owned foreign businesses, although existing private firms, such as paladares, are still forbidden from taking foreign capital. Much, including whether or not Cuban-Americans can invest, will depend on how the government implements the law. "It's still very discretionary," Mr Vidal says.

Despite their failings, Cuba's new rules are a reminder of how inflexible United States law remains. Because of the 53-year-old embargo against Cuba, some Cuban-Americans fear they will be left behind as investors from Brazil, China, Russia and Europe move in. Already Tampa, on Florida's west coast, is vying for a greater share of Cuban business when the embargo is lifted. "Every day we're missing opportunity," says Bob Rohrlack, head of the Greater Tampa Chamber of Commerce.

In Miami people talk of a tipping point. Alberto Ibargen, a former publisher of the Miami Herald, says demographic trends that began decades ago have finally softened the mood towards Cuba (though "absolutely not" towards the Castro regime). If American restrictions on all tourism to the island were lifted, "you'd get a couple of letters to the editor."

Some Miami Cubans have managed to squeeze through cracks in the embargo. Hugo Cancio, who left the island in the Mariel boatlift of 1980, owns a website and magazine, OnCuba, written mostly by Cubans, which plays down repressiveness and plays up commerce and culture. He has a newsroom in Havana but despite his entreaties, American law forbids him from paying its staff. Tony Zamora, a semi-retired Miami lawyer who was jailed in Cuba for taking part in the 1961 Bay of Pigs invasion, has also recast himself as a promoter of investment in the island. After 40 trips to Cuba, he calls the embargo "almost a total failure".

Many Cuban-Americans put their faith in Mr Obama to soften the embargo, even if Congress will not lift it. They note that more than 60% of Miami-Dade County, where they predominate, voted for the president in 2012, many more than in the previous election, even after he eased policy towards Cuba. If Charlie Crist, a Republican-turned-Democrat who is running for a second turn as Florida governor and supports lifting the embargo, wins in November, it will help their cause.

Even so, the old guard cares more about keeping the embargo than younger Cuban-Americans do about getting rid of it. Most Cuban-American congressmen in Was.h.i.+ngton, DC, remain avid backers of it. Mauricio Claver-Carone, who heads a pro-embargo lobby group, argues that all foreign investment still goes to monopolies run by the Castro regime, which helps prop it up. The stakes have been raised by the jailing of Alan Gross, an American citizen convicted in Cuba of smuggling communications equipment to dissidents. Few believe the Obama administration would risk a bold move without his release.

The embargo's days are nonetheless numbered, not least because Ral Castro, the 82-year-old president, and his brother Fidel, 87, will not live for ever. In the meantime, it increasingly seems like a relic, as outdated as the Castros' Cuba.

Elections in Quebec The s-word The ruling PQ has badly misjudged Quebeckers' appet.i.te for sovereignty Apr 5th 2014 | OTTAWA | From the print edition WHEN Pierre Karl Peladeau (pictured) raised a clenched fist in the air on March 9th and declared he wanted Quebec to be an independent country, Quebeckers took notice. Unfortunately for the ruling Parti Quebecois (PQ), for whom the multimillionaire media baron is a star candidate in the April 7th election, it was the wrong kind of attention. Independence, or sovereignty as the PQ likes to call it, might be the party's raison d'etre but the majority of Quebeckers do not want another divisive referendum after failed votes in 1980 and 1995. The PQ was slightly ahead of the second-place Liberals when Mr Peladeau's candidacy was unveiled. It has been sliding downward ever since.

Why Pauline Marois, who is trying to turn the PQ minority government of September 2012 into a majority, did not see this coming is a bit of a mystery. Until Mr Peladeau thrust independence to the forefront, Ms Marois a.s.siduously avoided talk of a referendum, preferring to focus on a proposed secular charter that would prohibit civil servants from wearing overt religious symbols such as a hijab or turban. Opponents expected the separatist party would tap the latent xenophobia of rural and elderly Francophone voters in order to secure a majority, and then pick fights with the federal government to bolster separatist feeling before calling a referendum.

That option no longer looks possible. Polls indicate the federalist Parti Liberal, led by Philippe Couillard, is most likely to form the next Quebec government. A hint of panic has crept into the PQ's attempts to redirect public attention away from talk of independence. The PQ has claimed that foreign students attending Quebec universities were registering to vote in order to steal the election. Electoral authorities investigated and found the claims to be groundless. Another scare story, told at a PQ event attended by Ms Marois, about the threat of Muslims commandeering an apartment swimming pool in Montreal and preventing elderly women from doing aquafit exercises, provoked accusations of xenophobia from Mr Couillard.

After making a splash at his debut, Mr Peladeau has retreated to the background, although not before a second incident where Ms Marois was seen physically shoving him away from a microphone. She must wish she had done that sooner.

Even if the PQ were to squeak in, the campaign has shown how foolhardy the party would be quickly to push for independence. The problem for the PQ is that biding its time is not much of a strategy either. Young Francophones used to be the bedrock of support for the separatist cause, but now sovereignty appeals largely to ageing baby-boomers (see chart).

Claire Durand, a sociologist at the University of Montreal, speculates that the sovereignty issue has been defused for younger Francophone voters because of measures taken by successive governments to boost protection of the French language at school and in the workplace, and to acquire more control over the economy and immigration. Maurice Pinard of McGill University, who conducted the first poll on support for sovereignty in Quebec in the early 1960s, sees separatism as a social movement taken up by one generation and dropped by the next. If so, the question for the PQ is what it really stands for.

Scandal in Mexico A trashy tale s.e.x, politics and a headache for the PRI Apr 5th 2014 | Mexico City | From the print edition IT DIDN'T take long for Mexico's ruling Inst.i.tutional Revolutionary Party (PRI) to react to the seriousness of the s.e.x scandal erupting around it on April 2nd. Just hours after Cuauhtemoc Gutierrez de la Torre, the party's president in Mexico City, publicly denied a report that he kept a network of prost.i.tutes on the party payroll for his personal use, the PRI put him on leave and called for a police investigation.

The story by MVS News, one of Mexico's most influential radio programmes, is colourful and the allegations it makes are potentially very sordid. Mr Gutierrez, as heavy-set as an ox, comes from a family that made a fortune on Mexico City's rubbish tips. His murdered father (a former PRI stalwart) was known as the "King of Rubbish". Heading the PRI in Mexico City is the highest office he has held, although the party has not ruled there since 1997. His office issued a statement saying the MVS report was "deceitful, ill-intentioned and slanderous" and that Mr Gutierrez himself wanted an investigation.

According to MVS, the women at the heart of its report are known as edecanes, or hostesses. In their short skirts and high heels, they are a common feature of political and business gatherings in Mexico. Mostly their job is to hand out brochures or accompany people to their seats.

MVS said that after a tip-off, a female reporter answered an advertis.e.m.e.nt for a hostess job in Mr Gutierrez's office at PRI headquarters in Mexico City. It aired what it said were secretly taped recordings in which a woman it claims worked for Mr Gutierrez can be heard telling the undercover reporter the job requires her to provide s.e.x-"oral or v.a.g.i.n.al"-when her boss asks for it, as well as more normal hostess duties. The tape recordings include discussion of salary-11,000 pesos ($850) a month, tax-free, plus tips-and the reporter is told she will be on the PRI's payroll. "It's absolute discretion, because obviously he protects his image," the female voice tells the reporter.

Speaking on air to MVS News, Mr Gutierrez described the report as "false as all falseness" and said there were no hostesses on the PRI payroll. He was not asked whether the woman on the tape was his employee.

The scandal immediately lit up the airwaves and social-media sites. It puts the PRI in an awkward spot. The party, which ruled Mexico for much of the 20th century, often according to rules it set for itself, returned to power nationwide in 2012 with the election of President Enrique Pena Nieto. It is keen to put its sleazy past behind it. But given the murky relations.h.i.+p between politics and justice in Mexico, investigations often lack credibility. People believe what they choose.

Bello A political FUTbol Mich.e.l.le Bachelet's struggle to combine equity and growth in Chile Apr 5th 2014 | From the print edition "CHILE has only one great enemy and it's called inequality," declared Mich.e.l.le Bachelet on March 11th as she returned to La Moneda, the presidential palace, just four years after leaving it. Following an interlude of rule by the centre-right, Ms Bachelet won by a landslide in last year's presidential election on the most left-wing programme the country has seen since the ill-fated Marxist government of Salvador Allende more than 40 years ago. She argued that for all Chile's economic success of the past three decades, unless the state intervenes to foster a fairer and better-educated society, the country will moulder in what economists call "the middle-income trap", never making the leap to developed status.

Her campaign platform contained three big proposals. The first was an education reform inspired by the notion that the state should offer free and equal education to all. Second was a new const.i.tution to replace the existing one, which, though much amended, dates back to the dictators.h.i.+p of General Pinochet. And the third proposal was a tax reform aimed both at raising revenue to pay for the education reform and at making the tax system fairer.

Ms Bachelet is no mad populist. Chile is not Venezuela, nor even Argentina. In the humdrum reality of a Latin American liberal democracy, achieving the magical combination of greater fairness and greater prosperity means marrying political imperatives with complex technicalities.

The first test will be the tax-reform bill, which the president sent to Congress this week. It aims to raise an extra $8.2 billion (or almost 3% of GDP). It contains some sensible measures, including fuel taxes and one on sugary drinks. It proposes a gradual rise in corporate-income tax from 20% to 25% and a corresponding reduction in the top rate of personal-income tax from 40% to 35%. Chile has an integrated tax system in which shareholders receive a credit for corporate-tax payments; aligning the two rates more closely is intended to discourage individuals from setting up sh.e.l.l companies.

The bill also abolishes a mechanism known as the Taxable Profits Fund (FUT), under which shareholders do not pay tax on reinvested company profits. The FUT's detractors complain, correctly, that the system has been abused, via corporate credit cards and sh.e.l.l companies in tax havens, to allow the rich to evade taxes on profits that have actually been used for personal consumption-the skiing holidays and Ferraris of urban legend in Santiago. But the FUT's defenders point out, equally correctly, that the system has been a key factor behind Chile's investment-led economic growth.

As compensation for abolis.h.i.+ng the FUT, the bill allows instant depreciation of machinery and equipment. That may help miners and manufacturers, but not service businesses. Unless it is amended, the bill is likely to have two bad outcomes. Retained earnings are a big source of financing for corporate investment in Chile: companies may now have to rely on more borrowing, which for small firms costs up to 15% a year. Second, shareholders will now be taxed on profits they do not receive as dividends.

It would be remarkable if the tax changes did not prompt some reduction in investment and share prices. The fact that the bill envisages ending the FUT only in 2018 suggests Ms Bachelet's economic team realises this. To make matters worse, Chile's economy is now slowing sharply in tandem with a falling copper price (this week's offsh.o.r.e earthquake, which killed at least six people, seems to have spared local mines). More government spending could give the economy a boost, but not if it comes at the expense of private investment.

The new government could have chosen to close the loopholes in the FUT, rather than abolish it. That it didn't says much about the way politics is now conducted in Ms Bachelet's coalition, whose main parties governed Chile from 1990 to 2010. Abolis.h.i.+ng the FUT was proposed by a rival of Ms Bachelet's in last year's coalition primary election, and the policy was instantly adopted by all the parties in the grouping. In the past party leaders would have heeded their technical experts on such matters. In Chile's more populist political climate, that is no longer so.

The tax reform is simple compared with the government's plans for education. As for the task of replacing the const.i.tution, no wonder the president has kicked this issue forward until later in the year. Ms Bachelet is right that Chile is in many ways an unfair country that needs to change. But she will need all her considerable political skills if she is not to sacrifice sound public policy on the altar of populism.

Asia.

Indonesia's elections: Democracy's big bang Filthy India: Mucking it up.

j.a.panese whaling: Harpooned Gays in Central Asia: Criminal relations Banyan: Don't count on it Indonesia's elections.

Democracy's big bang.

A parliamentary poll next week has much bearing on the presidential one in July Apr 5th 2014 | JAKARTA | From the print edition AS ORGANISED human efforts go, it is a big one. Nearly 190m Indonesians out of a population of about 250m are eligible to go to the polls on April 9th to elect a new parliament. The election commission has printed 775m ballot papers and s.h.i.+pped them to 550,000 polling stations scattered across the sprawling archipelago's 900-odd settled islands. It is the fourth election since protesters, led by students, ousted Suharto, Indonesia's long-ruling dictator, in 1998.

At stake are 560 seats in the House of Representatives or DPR, the lower house, along with 132 seats in the upper house. In addition, under Indonesia's highly decentralised system of government since Suharto, voters will be electing 2,112 a.s.semblymen in 33 provinces and almost 17,000 legislators at the district level. But in truth, for all the gargantuan nature of the undertaking, all eyes will be on just one result: how well the main opposition party, the Indonesian Democratic Party of Struggle (PDI-P), does in parliament.

For it is the parliamentary polls that decide who may be nominated in the presidential election to be held on July 9th. Last month the PDI-P's matriarchal head, Megawati Sukarnoputri, daughter of Indonesia's first president and herself president over a decade ago, stood aside, anointing the capital's popular governor, Joko Widodo, as her party's chosen candidate for president.

According to all the opinion polls, Jokowi, as he is widely known, has a seemingly una.s.sailable lead over all the other likely candidates to succeed Susilo Bambang Yudhoyono, who is coming to the end of his second and final term. But before it may enter Jokowi in the presidential race, the PDI-P must secure 25% of the popular vote in the legislative elections, or 20% of the seats in the DPR. Should the party fail to reach the nominating thresholds, it will have to strike an alliance with at least one other party, and perhaps give up the chance to choose Jokowi's running-mate for vice-president.

Such coalitions are commonplace in Indonesian politics, but the PDI-P hopes that Jokowi's popularity will help push the party over the thresholds. According to an opinion poll published this month by the Centre for Strategic and International Studies, a Jakarta think-tank, 20.1% of those surveyed would put their mark beside the PDI-P's fiery-eyed buffalo. Suharto's old party, Golkar, had the support of 15.8% of respondents, while 11.3% say they would vote for Gerindra, led by a former special-forces general, Prabowo Subianto.

Mr Yudhoyono's own Democrat Party is likely to be the biggest loser on April 9th. It won 21% of the vote at the 2009 election but now enjoys only single-digit support. This reflects widespread disenchantment with the corruption scandals and the drift in Mr Yudhoyono's government.

There have been moments of colour during the campaigning. At a military-themed spectacle inside Jakarta's main stadium, Mr Prabowo rode on a bay steed and bl.u.s.tered against those who would sell the country to foreigners. In eastern Java, at a rally organised by a small Islamic party, a hip-swinging performance by a 67-year-old crooner of dangdut songs, Rhoma Irama, reportedly caused 14 women to swoon. Many parties have enlisted the support of soap-opera stars, swimsuit models and similar attractions to tickle voters' interest.

Behind the razzmatazz of the election, a bit more is at stake than how well Jokowi's party fares. The lower house is not the rubber-stamp inst.i.tution it was under Suharto. Indonesia's next president will have to work with it, not least to pa.s.s a $160 billion-odd budget. And lately it has got pus.h.i.+er, says Douglas Ramage of Bower Group Asia, a consulting firm. In February it pa.s.sed a law giving itself power to veto trade treaties, for example. It often gets its way over the executive, most recently in relation to mineral exports.

Whatever the outcome on April 9th, Indonesia's parliamentary parties are not going to propose wildly different policies on tax, welfare or indeed any of the issues that define parties in Western democracies. In Indonesia they command a broad cross-party consensus. Some observers see the parties merely as political vehicles for individual politicians and their families, but Marcus Mietzner of the Australian National University points to parties' distinctive cultural and political ident.i.ties. Indonesia is the world's most populous Muslim-majority country, and as soon as parliamentary debates touch on things like sharia law or religious minorities party differences start to count.

This year will be the last in which the parliamentary and presidential elections are held on different days. Indonesia's const.i.tutional court has ruled that holding the presidential election three months after the parliamentary one encourages horse-trading in ways that undermine the checks and balances of democracy. It decided that both elections should be held on the same day, though not until 2019. That will be an even bigger bang.

Filthy India Mucking it up The capital's battle with rubbish shows the recalcitrance of the informal economy Apr 5th 2014 | From the print edition Migrants and Milvus migrans: supreme scavengers THE view from Rajat Chaurasia's place of work is spectacular. A steaming mountain of rubbish, it rises 30 metres (about 100 feet) above the Okhla industrial district, providing a view over much of south Delhi. With rats, kites and, during the monsoon, clouds for company, Mr Chaurasia spends days and nights there, salvaging sc.r.a.ps of plastic and metal from the detritus of India's capital.

He is one of around 200 ragpickers working the Okhla dump, one of India's biggest, with around 7m tonnes of rubbish. Most of them live at the foot of the mountain, in a shanty of iron and plastic. They scavenge for about ten hours a s.h.i.+ft-enough, says Mr Chaurasia, a 19-year-old with a decade of experience on the dump, to earn 40-100 rupees (67 cents-$1.67). It is a traditional system-the ragpickers are Dalits, members of Hinduism's ancestral undercla.s.s-but it has helped a.s.sure India of one of the world's highest rates of recycling: anything from 50-90% of the waste stream. Still, it is inefficient. Indian streets are filthy and landfills a health hazard. And for the ragpickers the work is wretched.

Wading through rubbish gives the pickers skin diseases and infections. Methane emitted by the dump makes them nauseous. A decade ago, people say, when the dump was more unstable than it is today, several ragpickers were buried alive. Officials from the Delhi government, which runs the dump, are a more quotidian peril, shaking the ragpickers down for five or ten rupees a time. "NGOs are always coming here and expressing concern, but this is how we earn our living," Mr Chaurasia shrugs. "Nothing changes in India."

It is easy to see how he would think that. Solid-waste management is the responsibility of India's munic.i.p.al governments, yet with few exceptions they discharge it execrably. The World Bank blames apathy, ignorance and a lack of money for this failure. It could add Hindu tradition and an inexhaustible supply of dest.i.tute ragpickers, 100,000 in Delhi alone.

Some fast-growing cities have attempted to clean up the mess. Ahead of the 2010 Commonwealth games in Delhi, private waste-management firms were made responsible for half the city's dozen zones. The government also announced plans to integrate the ragpickers into the formal waste system, by giving out protective clothing and training. To ease the pressure on the capital's three main landfill sites, including Okhla, all of which are hopelessly overfilled, the government established two composting plants and a waste-to-energy power station, able to consume around 1,900 tonnes of rubbish a day. At the time, this looked like a striking turnaround. Yet outside Delhi's rich suburbs, where local residents' a.s.sociations have taken matters into their own hands, the city is not obviously cleaner.

Perhaps that is not surprising. Greater prosperity generates more rubbish, and in Delhi, one of India's richest places, non-industrial waste has grown by nearly a third in a decade. It appears too much for several of the private contractors to cope with. Meanwhile, Delhi's shortage of landfill capacity is becoming an emergency.

The city government's efforts to secure new sites have been blighted by myriad legal challenges, from irate local residents and champions of ragpickers, to the unhelpfulness of neighbouring states. After over a decade of looking, it has secured a single site, in western Delhi. This is bad news for the capital, and India's 7,000-odd other towns and cities are likely to fare worse. Only those in relatively well-managed Gujarat-where an outbreak of pneumonic plague in 1994 spurred a major clean-up-are getting much better.

What will turn back the muck? The usual hope is that middle-cla.s.s taxpayers will, after the fas.h.i.+on of Delhi's residents' a.s.sociations, demand more hygienic streets from increasingly capable governments. Yet it will take a while-not least because of India's enormous supply of ragpickers and paucity of alternative livelihoods for them.

Wherever ragpickers have been retrained for the formal economy, says Suneel Pandey of the Energy and Resources Inst.i.tute in Delhi, a horde of replacements emerge from the countryside to replace them on the dumps. Mr Pandey has first-hand experience of their tenacity. A research project he was running to measure methane emissions from the Okhla dump became a battle with ragpickers who stole the plastic pipes he sank into it. The guards Mr Pandey installed to protect the pipes were stabbed. Peace of sorts broke out only after one of his boreholes caught fire-allowing guards and ragpickers alike to boil their tea over it. If India's informal sector is unproductive, it is also ingenious.

j.a.panese whaling Harpooned At last, it looks like curtains for the country's "scientific" slaughter Apr 5th 2014 | TOKYO | From the print edition Bad science IN ONE of Tokyo's oldest whale restaurants, Kujiraya, the whiff of resentment lingers along with the cloying smell of fried whale meat as customers digest unwelcome news from The Hague. On April 1st the International Court of Justice legally skewered j.a.pan's "scientific" whale hunts to the Antarctic Ocean. The hunt is partly paid for by the sale of meat to high-end restaurants such as this one, which is why opponents brand it as illegal commercial whaling in disguise.

To the surprise of j.a.pan's small band of whale-meat lovers, the court agreed. Twelve of its 16 judges sided with Australia, which brought the case, saying that j.a.pan had no scientific reason to cull about 1,000 Antarctic whales each year. The court noted that the research had produced just two peer-edited papers in a decade, in effect tugging away the figleaf used to keep j.a.pan's whaling programme alive since the international moratorium in 1986 which ended commercial hunts.

The government has long argued that whaling is an ancient j.a.panese tradition. Maintaining the argument has been costly. A report by the International Fund for Animal Welfare says j.a.pan has in effect nationalised its whaling programme, subsidising it to the tune of $400m since 1988. Ever fewer j.a.panese eat whale meat. For the middle-aged diners, a visit to Kujiraya is an expensive culinary trip down memory lane (industrial whaling expanded after 1945, when a ravaged country was desperate for fresh sources of protein). Over 5,000 tonnes now sits unsold in deep freezes.

The Hague decision comes at a key moment. Rising oil prices and extra security to protect the whaling fleet from attacks by militant environmentalists have pushed the cost of each annual Antarctic cull to over $10m, says Atsus.h.i.+ Is.h.i.+, an expert on j.a.pan's environmental politics. The whaling industry is so desperate for funds-and so politically connected-that it managed to claim $28m from tsunami relief funds in 2011, causing an international outcry. The whaling fleet badly needs a new mother s.h.i.+p, at a cost that would spark a domestic debate about the point of the campaign.

A spokesman for the fisheries agency says j.a.pan will abide by the decision but continue "scientific" whaling in the western North Pacific, a cull that yields about half that of the Antarctic catch. That will almost certainly trigger another legal challenge. And scaling down the size of j.a.pan's scientific study to meet the court's new legal requirements could mean a cull of barely ten whales-hardly worthwhile.

j.a.pan has another option. It could follow Norway (which taught j.a.pan industrial whaling a century ago) and Iceland by ignoring demands to stop killing whales. But unlike those countries, j.a.pan withdrew its objection to the 1986 moratorium. Snubbing it now would also mean flouting several international sea treaties, with diplomatic consequences. j.a.pan seems to have swallowed this week's lump of news and will keep its fleet at home.

Gays in Central Asia Criminal relations Rulers take a page out of Russia's intolerant playbook Apr 5th 2014 | BISHKEK | From the print edition CENTRAL ASIA's republics are no bastions of tolerance. But now even the most liberal of the region's countries is moving to restrict gay life. Rulers in these ex-Soviet states seem to be inspired by Russia's growing anti-Westernism.

Kyrgyzstan is considered the region's most open and democratic country, despite grinding poverty and recent experience of revolutions and pogroms. Yet a bill introduced into the legislature on March 26th proposes jailing anyone who spreads information about gay rights. The bill is a stricter version of Russia's recent ban on gay "propaganda". It must now pa.s.s several readings before going to the pro-Russian president. There have been calls for similar legislation in next-door Kazakhstan, where a deputy from the ruling Nur Otan party said last year that gays should be considered "criminals against humanity".

Civil-society activists in Bishkek, Kyrgyzstan's capital, fear that Russia, still the dominant economic force in the region, is pus.h.i.+ng an anti-liberal ideology on its neighbours. But Russia may have simply provided a legislative model to reinforce existing conservative att.i.tudes. Either way, with Russian media dominating Central Asians' television screens, gay, bis.e.xual and transgender rights have become synonymous with a degenerate West. At a recent anti-gay rally outside the American emba.s.sy in Bishkek, angry young men burned a picture of a young blogger, equating his support for the pro-European movement in Ukraine with gay rights.

Exaggerating malign Western forces helps the Kremlin concoct enemies and distract from domestic problems. In Kyrgyzstan lawmakers are doing the same. While ignoring failing schools, corruption and poverty, some have pushed for anti-NGO legislation almost identical to a Russian law that labels not-for-profit organisations underwritten by Western money as "foreign agents".

h.o.m.ophobia runs deep across Muslim Central Asia. In Turkmenistan gay s.e.x earns up to five years in a labour camp (going up to 20 years for repeat offenders). In Uzbekistan the sentence is three years in jails rife with tuberculosis. In all five Central Asian republics, anti-gay attacks go unpunished.

Challenges to h.o.m.ophobia are seen as Western meddling. In January Human Rights Watch, an NGO, detailed how Kyrgyzstani police use violence and blackmail to extort money from gay men. In response, the country's chief Muslim cleric issued a fatwa condemning same-s.e.x relations as well as groups, such as NGOs, that "disseminate social discord".

Banyan Don't count on it Myanmar's course is leading in the wrong direction Apr 5th 2014 | From the print edition ONE of the world's good-news stories, Myanmar is known as an uplifting saga of the transformation of a poverty-stricken military dictators.h.i.+p into a liberal democracy with a fast-emerging economy. Of late, however, it is drawing some ugly headlines. The immediate cause is an ill-conceived census, counting for which began on March 30th. It threatens potentially disastrous consequences for communal relations in a country of bewildering ethnic diversity. The more fundamental worry, ahead of a pivotal election next year, is whether the army really intends to cede power. A remarkable revolution, with no bloodshed and no losers, is beginning to look less like a revolution at all.

In principle nothing is wrong with a census. Myanmar has not had one since 1983, so estimates of the population (rough guess: 60m) are based on projections. It makes a nonsense of government planning. But the census's 41 questions stray far beyond the basics of name, age and occupation into the minefield of ethnicity. On the face of it, that is also reasonable. A common a.s.sumption is that the largest ethnic group, the Burmans, make up about 60% of the population. But Aung San Suu Kyi, the leader of the opposition, has suggested that the minorities make up 60%. The many conflicts between the government and the various ethnic groups in the border areas pose perhaps the biggest threat to Myanmar's future peace and stability. Numbers would be handy.

The trouble is that the census uses an eccentric list of 135 recognised nationalities, inherited from the British colonialists and incorporated into a 1982 citizens.h.i.+p law. Of its many inaccurate or debatable features, the most egregious is the exclusion of a group known as the Rohingyas-of whom Myanmar has about 1m. Muslims of South Asian descent, Rohingyas live mostly in the western state of Rakhine (once Arakan), which borders Bangladesh. Most are stateless, regarded by the authorities as illegal Bengali immigrants. Yet many have been in Rakhine for generations. Even Miss Suu Kyi has failed to back their right to citizens.h.i.+p, denting her moral stature overseas. Repeated bouts of murderous violence between them and the Buddhist, ethnic-Rakhine, majority in the state have left tens of thousands, mostly Rohingyas, in crowded camps, and much of the state under a form of apartheid. Shopkeepers who sell to Rohingyas risk reprisals.

Rohingyas were a.s.sured that they could identify themselves as such in the census, by telling the census-taker to write it in. Predictably, this prompted a backlash from the Rakhines, who believed that the Rohingyas' unwelcome presence would become permanent and worried about a new influx from Bangladesh. The tension has even led to attacks on foreign and local NGOs working with the Rohingyas. Late last month nearly 700 aid workers had to be evacuated from Rakhine. The NGOs now worry about how the Rohingyas in camps will be kept supplied.

In response to pressure from Rakhines, the government has backtracked on commitments to the census's foreign sponsors-the UN Population Fund and governments including Britain's-and decreed that Rohingyas could not after all identify themselves as such. They are still "Bengalis". Instead of being a small step on the road to the integration into Myanmar of a persecuted minority, the census will become another brick in the wall that excludes them.

This is not the only way in which the government of a supposedly reformist president, Thein Sein, has been pandering to Buddhist zealotry, and to anti-Muslim prejudice. Stoked in part by a group led by a rabble-rousing monk, known as As.h.i.+n Wirathu, the prejudice has encompa.s.sed other Burmese Muslims as well as the Rohingyas. Parliament is to consider a law that would ban Buddhist women from marrying non-Buddhists. Mr Thein Sein has argued this is needed to "preserve race and religion".

For all sorts of reasons, the West has given Mr Thein Sein the benefit of the doubt. The former general's changes have already transformed Myanmar into a far more relaxed, open country than the one he took over in 2011. Political prisoners have been released, the press freed and the ubiquity of day-to-day tyranny ended. Myanmar is a better, happier place. Moreover, the country remains a great strategic prize, s.n.a.t.c.hed from China's...o...b..t, and one of the last great untapped markets and resource suppliers. The world, as Miss Suu Kyi has remarked, loves a happy ending.

The end of the rainbow But when she said that two years ago, she observed that there was a long way to go. And the census controversy draws attention to the stalling of other reforms, notably to the const.i.tution, an army-imposed charter. It can only be amended with the agreement of more than three-quarters of the parliament, a quarter of whose seats are reserved, as it happens, for the army. A parliamentary committee has just decided not to lower the threshold needed to pa.s.s an amendment. Instead, the army's parliamentary quota is to be reduced. But no timetable is given. Nor, as things stand, will Miss Suu Kyi, Myanmar's most popular politician, fulfil her wish to be a presidential candidate next year. The const.i.tution, with her in mind, bars those with foreigners in the family, and her late husband was British, as are her two sons. Her demand to change this has not been backed by the government, which is divided about how far and how fast to change.

The unlikely consensus between Mr Thein Sein and Miss Suu Kyi, forged at a meeting in 2011, where they decided to trust each other, has broken down. The consensus was the basis of Myanmar's transformation since. But now, before next year's election, Burmese politics is in a dangerous phase. Not all the ex-generals manning the government seem reconciled to giving up power. Anti-Muslim feeling is mounting. Lasting peace with the many ethnic insurgencies remains elusive. And Myanmar's ordinary people, the poor, wonder when all these marvellous reforms they hear about will begin to improve their lives.

China.

Pensions and retirement: Paying for the grey Politics and the mafia: Web of intrigue Abandoned babies: Bundle of tragedy Pensions and retirement Paying for the grey As a pensions crisis looms, China looks at raising the retirement age Apr 5th 2014 | BEIJING | From the print edition IN THE 1950s, when China's civil war was only just over and life expectancy still below 45, setting a relatively young retirement age seemed sensible to China's new Communist Party rulers. But 60 years on, a recent study showed the nationwide average age of retirement is still 53 even though the economy is transformed and the average life expectancy is now 75. With the number of pensioners set to soar, and the number of young workers able to support them unable to keep up, China has been making long-overdue changes at both ends of the demographic spectrum. Late last year it started to ease its restrictive one-child policy. Now it is planning an adjustment to the retirement age.

Allowing people to choose if they want more than one child may prove more popular, but raising the retirement age is likely to bring more economic benefits. Officials at China's Ministry of Human Resources and Social Security (MHRSS) have solicited advice from Chinese and foreign experts, including the World Bank and the International Labour Organisation. Many have advised raising standard retirement ages-currently 50 or 55 for women and 60 for men-by five years each.

The government has clearly signalled its intention to follow this advice. In October an MHRSS official openly supported the idea, and in November, an important meeting of senior party leaders included three "gradual" adjustments in retirement age in its official policy doc.u.ment. State media recently quoted a World Bank official saying the current arrangement is "not sustainable" and an MHRSS official has told Hong Kong media that adjustments are "inevitable". As always, caution is the watchword. Yin Weimin, the MHRSS minister, said last month that officials mean to raise the retirement age and "will definitely introduce the plan before 2020".

It is not hard to see why China feels the need to act. The proportion of China's population over 65 is currently 9%, but is projected to grow to 24% by 2050 (see chart). A report published in December by the Chinese Academy of Social Studies (Ca.s.s) said that without adjustments, pension deficits would appear in 2030, and that by 2050 the acc.u.mulated shortfall would amount to 90% of China's GDP.

Officials claim that earlier predictions of pension deficits were "groundless". They acknowledge that as many as 14 provinces suffer deficits, but insist that, on a nationwide basis, the pension surplus at the end of 2013 stood at 3.1 trillion yuan ($500 billion), including 400 billion yuan in the pension fund for urban workers.

One important landmark on China's drift towards demographic peril came in 2012, when the proportion of working-age people first started falling. Officials announced a decline of 3.5m in the net number of working-age citizens that year. In 2013 there was a further decline of 2.4m. Official projections suggest that trend will continue until the mid-2020s.

Pension penchant Du Peng of Renmin University in Beijing, says the number of pensioners in China will rise from about 200m to 300m in the next ten years, although the size of the active labour force will stay fixed, at 700m. But before adjusting the defined retirement age, he says China must first reform the pension system. Convincing people to work longer, says Mr Du, will require better management of state pension schemes for a population largely sceptical about the fairness, reliability and flexibility of pensions. If people work and contribute for 30 years, "they need a clear idea of what they will get", he says.

Experts also point to the need to deal with the imbalance between rural and urban pension schemes. Ca.s.s recently reported that for 2012, annual pension benefits for retired urban workers stood at 20,900 yuan, compared with just 859 yuan for retired agricultural workers. The government has also announced plans to "unify" urban and rural schemes but here, too, they have provided little detail. Mr Du says that, at a minimum, annual rural pensions must be brought up to the official poverty threshold of 2,300 yuan. A budget report presented to China's legislature last month trumpeted a 10% rise in urban pensions, to 22,800 yuan annually, but made no mention of increases for pensioners in the countryside.

Raising the age of retirement may be necessary but it will surely be unpopular. One survey, conducted in 11 Chinese cities and published in November, found that nearly 70% were opposed to an increase. It is to m.u.f.fle such unease that the government is discussing only vague plans for change, to be brought in gradually over the next two decades. But if they don't stop dithering and get on with it, demography will catch up with them.

Politics and the mafia Web of intrigue The trial of an alleged mobster may hint at the fate of someone more powerful Apr 5th 2014 | BEIJING | From the print edition THE noose appears to be tightening around the neck of Zhou Yongkang, China's former security chief. But the process has been slow and indirect, through the detention of allies and a.s.sociates.

On March 31st the trial began of Liu Han, a billionaire and accused mobster from Mr Zhou's former power base in Sichuan province. Trials began the same day for Mr Liu's younger brother and 34 others. Mr Liu has been accused in official reports of leading a "mafia-style gang" that murdered, extorted, kidnapped and laundered money as he built an empire of mining, property and other interests worth 40 billion yuan ($6.5 billion).

In February Xinhua, the official news agency, published lurid reports about Mr Liu's alleged crimes, and the website of People's Daily, the party mouthpiece, ran a commentary suggesting that senior officials had protected him. Though it did not mention names, the message was clear. Mr Zhou was party chief of Sichuan from 1999 to 2002. From there he became national head of public security and then, in 2007, one of China's nine most powerful men as a member of the Politburo standing committee. He was close to Bo Xilai, a Politburo member who was believed to be manoeuvring for a spot on the standing committee but was jailed for life last year on charges of corruption and abuse of power.

Many others in Mr Zhou's network have been detained in the past two years. Mr Zhou himself is widely believed to be in detention, as is his son, Zhou Bin, caught in an anti-corruption campaign that President Xi Jinping is also using as a means to consolidate his own power. Other former leaders and their families have been rumoured as targets. A high-ranking military official, Lieutenant-General Gu Junshan, was charged on March 31st in what could prove to be a big corruption scandal in the army.

If Mr Zhou were to be put on trial, he would be the first standing-committee member tried for corruption, and it would be a clear signal of Mr Xi's grip on power. Observers will be looking for any hints of such crimes in the trials of Mr Liu and his a.s.sociates.

More clues to Mr Zhou's fate might emerge in the case of another Sichuan billionaire detained for corruption. Deng Hong was the man behind the New Century Global Centre in the city of Chengdu, a cavernous shopping complex (complete with 300-metre indoor beach) that China's media call the world's largest building. Mr Deng was also said to be close to Mr Zhou. China's nexus of power and money can sometimes seem unbreakable. In this case, Mr Xi wants to prove it is not.

Abandoned babies Bundle of tragedy A controversial scheme to deal with unwanted babies proves too popular Apr 5th 2014 | TIANJIN | From the print edition Safe haven "BEFORE abandoning, think carefully about your actions. Home is a child's real safe haven." So reads a sign on a small yellow building attached to an orphanage in Tianjin, a northern city (see picture). It is one of dozens of facilities, called "baby havens" in Chinese, that have been allowing parents of unwanted babies to leave them anonymously in a safe place. Pilot sites opened in 2011 and by last year 25 such buildings had opened around the country.

Each baby haven has an incubator, a cot and a delayed alarm device so that staff can tend to a baby no more than ten minutes after it is left. But amid complaints from orphanages that they cannot cope with the high volume of babies, the policy is getting a second look.