The Red Folder

Archived from April 15, 2024.

Key stories for the week, brought to you by the distinguished newsman Sasha Morel.

Reading for the sake of reading sucks. Telling yourself to read to win a round is nice but ineffective. This condensed news brief helps you understand current domestic and international issues, analyze the news, and gives you opportunities to read more.

International Stories

3 key international stories for the week:

(ZiG)-Zagging Towards a Brighter Future in Zimbabwe Lindsey Zhao

If you’re any extemper worth your money, you’ll know that Zimbabwe is synonymous with ‘that one country that printed a 100 trillion dollar bank note’. Although that was back in 2008, even now, their economic struggles haven’t gotten much better.

After years of financial mismanagement and corruption by both past and current presidents and the Reserve Bank of Zimbabwe, the country has cycled through 5 different currencies to try and calm down inflation, including the most recent one, the Zimbabwean dollar (it’s also known as the Real Time Gross Settlement Dollar, Zimdollar, etc- about as changing as the currency value itself). That currency lost around 80% of its value compared to the USD, and was so devalued you’d have to trade 28,720 banknotes for a SINGLE dollar.

In response, the Reserve Bank announced last week that they were launching a new currency, Zimbabwe Gold (ZiG) that was backed by foreign currencies, gold, and precious minerals like diamonds. The goal(d) is to make the new currency less volatile because it’s backed by nearly 2.5 metric tons of solid gold (nearly $185 million worth). Zimbabweans have 3 weeks to trade in their old RTGS dollars for this new currency.

Unfortunately, there’s more to this story. People weren’t trying to rely on the Zimbabwean dollar in the first place- longtime mistrust stemming from the 2008 bout of hyperinflation has left nearly 85% of all financial transactions in Zimbabwe done in the US dollar. Zimbabwean locals prefer using the USD as a ‘store of value to protect savings from persistent inflation.’

The real kicker here, though, is that the government is already contradicting itself. Despite proclaiming that the ZiG will be the only legal tender accepted at banks and other places, local magazines have reported that this new currency is unable to buy fuel, which is mostly imported from abroad. Because fuel suppliers in ZImbabwe prefer trading in the USD, the Reserve Bank of Zimbabwe made a sweeping exception to allow fuel trading in foreign currencies. Even further, they’re still requiring tollway fees be paid in dollars too.

This is likely to cause confusion and, in the short term, while Zim Dollar notes still remain legal tender until the end of the transition period, it’s resulting in an unavailability of change, as some vendors continue to accept Zim Dollars and some reject it. Already, this switch is forcing businesses strapped for change to round off prices for services like commuter buses to US$1.

But these all seem to be short-term consequences. Will this truly work in calming inflation? Some locals are hopeful. Yeukai Chiripanyanga, a Harare taxi driver, is hopeful for this currency to work so he no longer has to carry around huge wads of near worthless bills when customers pay their fees in cash. Some are less so- Tino Kapesa, a 23 year old college student, is skeptical that the ZImbabwean government will make any meaningful change to their monetary policy to prevent hyperinflation from occurring even with a gold backed currency.

He may be right. Simply creating a new currency does not create any guarantees that Zimbabwe will end its longtime unofficial policy of simply printing more money when its spending inevitably exceeds the amount they raise from taxes and tariffs. In order to establish a prosperous hyperinflation-free world for Zimbabwe, officials must be aware their overspending is only contributing to the problem.

Read more here:

2) Shadow Wars: Israel v. Iran Rowan Seipp

The old city of Jerusalem is a fascinating cross-section of the world's three major religions. For Islam, the old city holds the Al-Aqsa mosque, where Prophet Muhammad was transported from the Scared Mosque in Mecca to Al-Aqsa during the Night Journey, and then on to heaven. For Jews, the area holds the Western Wall, the only remains of the retaining wall surrounding the Temple Mount, the site of the First and Second Temples of Jerusalem. For Christians, the area is home to the Church of the Holy Sepulcher, where Jesus died, was buried, and rose from the dead. All of these sites were treated to a bit of a light show recently- green rockets. In one of the most provocative moments in the Israeli-Palestinian conflict, Iran fired around 170 drones, 30 cruise missiles, and 150 ballistic missiles toward Israel last night. While all of the rockets were intercepted by Israel’s defense systems in conjunction with the US, UK, and Jordan, this attack is a foreboding warning about the future of the conflict. Regardless of the reader's personal opinion of the conflict, the idea of this already bloody war (I prefer the term massacre) spreading is dangerous.

To put it bluntly, Iran’s foreign policy toward the US and Israel has not been kind. Ideologically, Iran views Israel as a usurper of Muslim lands and a threat to Islam. Tehran also views Israel as an extension of the United States. The Islamic Republic calls the United States the “Great Satan'' and Israel the “Little Satan.” With so much hatred, it then becomes understandable that Tehran views any organization that works in opposition to Israeli interest as a benefit toward Iran’s interest. This means that Hamas and Iran see a mutually beneficial relationship. However, the two's relationship has been rocky. Notably, Iran cut funding in half towards Hamas’s Damascus-based operation after the group criticized the oppressive dictator Bashar al-Assad. Following this debacle, Hamas pivoted toward more Sunni political powers, notably Egypt and Qatar. However, this move failed miserably, particularly with the ousting of Egypt’s Islamist president, Muhammad Morsi. His successor Abdel Fattah al-Sisi adopted a blockade against Gaza.

After this change, it no longer became beneficial for Hamas to align itself with Sunni interests. This meant that Hamas had to turn back toward Tehran. In the wake of their reunification, it appears evident that Iran has been supplying Hamas with weapons in a shadow war against Israel. Principally, there is evidence that Iran helped supply the weapons that led to the attacks on October 7th. Iran's shadow war has had the strategy of supplying weapons to groups like Hamas and Hezbollah. The Islamic Republic's operations have long been conducted in the shadows but this Saturday, that changed. This sudden shift in policy begs the question, why?

It appears that this sudden use of open aggression can be traced to years of prolonged US and Israeli killings. Three events have sent this conflict spiraling open. The first was the 2020 operation that killed the top Iranian commander Qassem Soleimani which was conducted by a United States drone attack.

The second was the late December assassination of another top Islamic Revolutionary Guards Corp commander in Syria, Razi Mousavi, in an Israeli air raid amid the fallout of the war on Gaza.

The third and most direct reason is the Israeli strike on an Iranian consulate in Damascus that resulted in the killing of Iran’s top soldier, Brigadier General Mohammad Reza Zahedi. After this strike, the IRGC began Operation True Promise, which is the most direct conflict the Middle East has seen between two nations since the Iran-Iraq war in the 80s.

With Israel on fire and an aggressive war with Hamas unfolding, Iran's involvement has detrimental consequences for Israel, the US, and the world. With this war quickly spreading past the stage of a proxy war, it is becoming apparent that this was a long time coming, guided by a need to satisfy Iranian strategic interests and pushed to the forefront by provocative Israeli actions.

Read more here:

3) Vietnam’s War on Corruption: Firing Squads and Free Trade Paul Robinson

The nation of China is not known for its human rights. Still, it may come as a surprise to many that China is by far the largest user of capital punishment; its executions account for well more than half of the world total.

The precise number, though, is a closely guarded secret. The World Coalition Against the Death Penalty estimates that at least 8,000 people per year have been executed in China every year since 2007. That is nearly 450 times the number of executions carried out by the United States in 2022 and over nine times the total in the rest of the world combined in the same year. Murder is a capital offense, as it is in most every country which retains the death penalty. Drug trafficking warrants a death sentence too, as it does in many other Asian nations such as Indonesia and Singapore. But what sets China apart from any other country is its use of capital punishment against those who commit corruption or other white-collar crimes.

China had been unique in this regard, until last Thursday when a court in Ho Chi Minh City, Vietnam handed down a death sentence to 67 year old billionaire Truong My Lan. The crime for which the state has decided she needs to die: corruption. Truong has committed one of the biggest financial crimes in all of history, stealing 44 billion dollars from a Vietnamese bank. For context, Bernie Madoff constructed a Ponzi scheme which stole a mere fifth of what Truong had managed to do. Elizabeth Holmes, who constructed an entire fraudulent health company, stole less than two percent of what Truong did. This case is without question the biggest case of fraud in Vietnamese history, and quite possibly the biggest in world history.

^Truong My Lan as her death sentence is pronounced in a courtroom in Ho Chi Minh City

But what is significant about this case is what it shows about the state of Vietnam and its notoriously high corruption. In order for Truong to get away with a fraud this large, hundreds or even thousands of people must have known but looked the other way. The true list of people complicit in this fraud likely ranges from low-level police officers to high-ranking politicians or officials.

The sheer scale of this fraud is unique in its enormity. The fact that something like this can happen is an embarrassment to Vietnam. In its ruling, the court cited not only the damage Truong’s fraud did to her victims, but to the Communist Party. And they’re not wrong. Vietnam has an economy which is growing very rapidly. It is fast approaching a GDP of half a trillion dollars. They are using the same playbook as China, by attracting foreign investment in manufacturing; labor is now cheaper there than in China, potentially attracting many new investors in the country.

However, the fact that one can apparently embezzle the entire GDP of Latvia without anyone noticing is a very obvious reason not to invest in Vietnam. Corruption in Vietnam threatens not just foreign investment, but the security of the Communist Party as well. Outrage over corruption is rapidly growing, and there is a real possibility that it could be enough to entirely topple the Communist government. Nguyễn Phú Trọng, the party’s leader, has announced a nationwide war on corruption, attempting to root it out so that the nation can grow unhindered. The death sentence passed on Truong is a public statement of the gravity of the Party’s position.

No matter how many people Vietnam may put in front of a firing squad, this does not address the issue that economic growth in Vietnam is making corruption more prevalent. With billions of dollars flowing in, the incentives will continue to grow, and a fear-based approach will not solve the problem. The average Vietnamese citizen makes under ten dollars a day, and the prospect of thousands of dollars is well worth the risk of being arrested.

Vietnam is trying to fight corruption without slowing economic activity, which may prove to be an impossible task. As the government becomes more and more involved in the economy, and keeps punishing those who are even suspected of wrongdoing, it will create red tape that may prevent free participation. Whether the CCP admits it or not, free markets were essential to producing China’s growth. As Vietnam attempts to move forward by destroying corruption by brute force, it creates an Orwellian society which is not at all conducive to economic growth. Eventually, the Vietnamese government will have to choose between two evils: looking better by cracking down on corruption, destroying the economy in the process, or letting the economy grow, even if that does mean that corrupt practices are even more prevalent and create even more problems in Vietnam.