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Sensemaker: A bug in the system

Sensemaker: A bug in the system

What just happened

Long stories short

  • The US House of Representatives adjourned again without a Speaker after 11 votes.
  • Prince Harry wrote in his memoir that he lost his virginity to an older woman behind a pub as a teenager (more below).
  • Brazil’s Marco Freire died surfing the NavarĂ© Canyon break in Portugal.

A bug in the system

On 8 January 2020, reports emerged that Chinese researchers had identified a new coronavirus that had caused 59 people in Wuhan to fall ill with mysterious, pneumonia-like symptoms. The disease, Covid-19, shut down the world. On Sunday, exactly three years later, China will become the last major economy to reopen its borders.

So what? China started shaking off its draconian zero-covid measures last month following unprecedented protests that directly challenged Xi Jinping’s authority. Since then cases have spiralled. It’s unclear exactly by how much (see below) but China’s reopening could be the gamble of Xi’s life.

Exit wave. Millions of people in China are catching Covid-19 every day. Chinese hospitals are overwhelmed, with many of the patients elderly and not fully vaccinated. Reuters reports that at a hospital in Shanghai’s suburban Qingpu district yesterday, patients lined the corridors of emergency treatment areas and the main lobby as police patrolled outside a nearby crematorium where mourners waited to collect the ashes of their relatives.

Pretence. Official data on cases, hospitalisations and deaths aren’t made public. On Wednesday, China reported one new covid death; its official total death toll stands at 5,264. Celebrity obituaries online are becoming unofficial noticeboards as citizens anonymously add details of dead relatives.  

Reality. Dr Louise Blair, head of vaccines and epidemiology at Airfinity, a London-based data analytics firm, estimates that, in reality, around two million people in China are catching covid every day, and around 15,000 are dying. She predicts that the number of daily cases will peak later this month at about 3.7 million, but that another, higher, peak of infections will follow as covid spreads from big cities to rural areas (some local governments are asking people not to travel for the Lunar New Year holiday later this month, when millions usually visit family).

In response, more than a dozen countries including Britain have imposed restrictions on travellers from China. Morocco has banned entry outright. Even the WHO, long criticised for being too soft on Beijing over covid, has said that Beijing is underrepresenting the “true impact of the disease”. Only Chinese vaccines are permitted – offers of free, more effective jabs from Europe tailored to target the Omicron variant have been rejected.

Grow, baby, grow Xi hopes the human cost of a quick relaxation of his covid rules will be obscured by a dramatic economic recovery, but right now the economy is sick:

  • Across industry, truck drivers and factory workers have fallen ill, causing short-term staffing shortages. China’s factory activity shrank at the sharpest pace in nearly three years in December, according to a survey of manufacturers.
  • Restaurants and other service sectors have also seen a fall in demand as people stay home, either sick or scared.
  • China is also facing a property market slump, high youth unemployment and low overseas demand for its goods as western consumers tighten spending.
  • China’s economy is expected to miss Xi’s 5.5 per cent growth target – economists predict full-year growth of 3 per cent in 2022.

Many are willing to bet on a stronger performance in the second half of this year, with growth expected to pick up to around 5 per cent through 2023. A sharp rebound, says the Economist, could power global growth – good for exporters to China and overseas travel locations, but bad if it keeps global inflation high and forces Europe to pay higher prices next winter for gas.

Will Xi’s gamble pay off politically? Having stacked the country’s top positions with his allies, there are few limits on his power. But he is also uniquely vulnerable to the consequences of his mistakes.


CAPITAL ECONOMY, BUSINESS AND FINANCE

Sad crypto

2023 has already been rough for crypto. Wyre, a crypto payments platform once valued at $1.5 billion, told employees it’s shutting down. Then, on 3 January, a prominent crypto influencer and serial entrepreneur known as DNP3 said “I’m sorry”, after gambling all his and his customers’ money away. Coinbase, a US-based crypto exchange, agreed to a $100 million settlement with the New York State Department of Financial Services over charges that it violated anti-money laundering laws by performing insufficient background checks on users. And yesterday the New York State Attorney General sued Celsius – a crypto lender with nearly $12 billion under management until it went bankrupt – for defrauding investors, after hundreds of thousands of investors were told their deposits belonged to Celsius and not to them. Bitcoin is down 55 per cent since last January.


TECHNOLOGY AI, SCIENCE AND NEW THING

Heavy metal

Germany has at last agreed to send armoured military vehicles to Ukraine, after ten months of waiting for the US and France to take the lead. They did so yesterday. The Pentagon said 50 Bradley Fighting Vehicles – like tanks but with smaller guns – will form part of its latest military aid package, and France said it would send an unspecified number of AMX-10 RCs, which have bigger guns than Bradleys but wheels instead of tracks. Germany said it would send Marder fighting vehicles. Bradleys and Marders are sometimes called light tanks but what Ukraine really wants is heavy ones. So far, no dice. To note: most richer Nato members don’t have many full-size battle tanks, but Greece does; 1,365 to Germany’s 266 and the UK’s 227.


The 100-year life health, education AND GOVERNMENT

mRNA possibilties

A big thorn in Xi Jinping’s side when it comes to controlling Covid-19 infections is the stark difference in effectiveness between China’s domestic vaccines and the Western mRNA vaccines (see above). mRNA vaccines, which “teach” cells to produce antigens of a virus rather than introducing a dead piece of the virus itself, have been shown to offer greater protection. Now, fast-tracked by the pandemic, researchers and big pharma are pumping time and money into finding out what else mRNA tech can do. Pfizer and Moderna are developing vaccines for RSV, HIV, Zika, malaria, shingles, flu and Epstein-Barr, but mRNA’s most exciting potential use is against cancer. Early results from a Moderna trial for a skin cancer vaccine have already shown promise and today the UK announced a partnership with BioNTech to accelerate research into mRNA cancer vaccines. It’s trickier and more expensive than developing a vaccine for viruses, but there is still “huge potential” for changing the way certain cancers are treated.  


Our planet CLIMATE AND geopolitics

Mountain glaciers

A new paper in Science uses two decades’ worth of satellite data to measure glacial retreat with more precision than ever. It finds that glaciers outside Greenland and Antarctica are on track to disappear 23 per cent faster than earlier models predicted. Half the planet’s glaciers will be gone by 2100 if warming is kept to 1.5 degrees; 68 per cent if it rises to 2.7 degrees. The smallest will go first – from the Alps, the Rockies, the Pyrenees and the lower Tien Shan – and they tend to be the most important in terms of summer water storage for irrigation and people living lower down. Bare rock summits are also worse than ice for biodiversity.


CULTURE soCIETY, IDENTITY AND BELONGING

Human hand grenade

What follows requires a preamble. Nobody voted for these people. They’re all quite comfortable thanks to accidents of birth and in Meghan’s case her talent as an actress. The worst that could possibly happen is the collapse of the British royal family, the opening of its palaces to the public and the continuation of a century-long British identity crisis. With that: according to Prince Harry’s Spare and related interviews, he took cocaine aged 17, was encouraged by William and Kate to wear a Nazi uniform to a costume party aged 20, spoke to his dead mother through a medium, killed 25 people on combat missions in Afghanistan and implored his father not to marry his “wicked stepmother” Camilla. He is clearly cross with his family – a human hand grenade, says Tina Brown – and determined to earn back his book advance. Few celebrity authors are as honourable. Spare is out next week.


Thanks for reading. Please tell your friends to sign up, send us ideas and tell us what you think. Email sensemaker@tortoisemedia.com.

Jessica Winch
@jswinch

Additional reporting by Giles Whittell, Phoebe Davis and Sebastian Hervas-Jones.

Photographs Getty Images


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