Economist 1/12/15

1. NEARLY 22m people took a cruise in 2014, according to the Cruise Lines International Association, an industry body. It reckons around 200 people die each year on cruise ships. According to the Telegraph, it all starts with an announcement. “Operation Bright Star”, for example, signals a medical emergency. “Operation Rising Star” means a passenger has passed away. Every cruise ship is legally required to include a morgue, and these must be away from food storage areas.Bodies are removed discreetly, often at the next port, and repatriated.A behind-the-scenes documentary profiling British Airways last year was revealing on the subject. Where possible, the dead are upgraded. According to the person in charge of training BA’s cabin crew, if there is a spare seat in first class, the body is strapped into that, covered to the neck with a blanket, and the passengers around it are informed.If there are no spare seats at the front of the plane, room is made in the economy section and a flight attendant has the dubious pleasure of sitting next to the corpse for the remainder of the flight.
2. So it seemed after German officials leaked to Der Spiegel, a weekly, their assessment that Grexit would not only be bearable but might even make the euro stronger.On January 5th Steffen Seibert, Mrs Merkel’s spokesman, insisted that German policy had not changed: it still aimed to hold the euro zone together. Yet all sides are now debating Grexit.Carsten Nickel at Teneo Intelligence, a risk consultancy, thinks Mrs Merkel is trying to “send a strong signal to Athens” that aid would still be tied to reforms, but that she will be flexible. A deal with Mr Tsipras could include lower interest or longer maturities for Greek debt. But politics limit her room for manoeuvre.This is the tightrope Mrs Merkel must walk after January 25th. Until then, she is likely to keep quiet.
3. Over 1m people, and perhaps as many as 2m, took to the streets for a peaceful “republican march”, after three days of terror in and around Paris that left 17 innocents and three terrorists dead.Leaders from across the world joined François Hollande, the French president, on the march.Equally important, the march was a moment in which France, a country marked in recent years by self-doubt, seemed to rediscover national pride. Now that the march is over, however, questions will start to crowd in. In particular, there are concerns about the capacity of French intelligence services to cope with radical Islamists, given the scale of the networks they are now facing. There are also doubts that Mr Hollande, the most unpopular president under the Fifth Republic, has either the political strength or the credibility to curb the rise of anti-Semitism and Islamophobia.
4. At yesterday’s vast demonstration in Paris of world leaders and ordinary folk, there was no top-level representative of the Obama administration, and on both sides of the pond, some people regretted that.One of the first American responses to the Paris shootings was something like: the Europeans brought this on themselves through their weak-minded appeasement of Islam, and their unwillingness  to defend free speech in a robust way.s evidence of hypocrisy and softness, it is recalled that only a few years ago, President Jacques Chirac put heavy pressure on Charlie-Hebdo not to republish cartoons of Muhammad. But the American administration faced a broadly similar dilemma, and made a broadly similar response, when Pastor Terry Jones was threatening to burn copies of the Koran. Constitutional principles like free speech and church-state separation made it impossible to prevent Mr Jones from doing as he planned; but he came under massive pressure to desist from his plans, from such figures as General David Petraeus (not usually seen as an appeaser) who said the act would endanger American lives.n one instant, and on balance correct response to the Paris shootings, a respected American observer of religious freedom, Nina Shea, argued that Europe must not respond to the atrocity by succumbing to its already entrenched habit of  curbing free expression through “hate-speech” laws.
5. On November 17th United Airlines, one of the three giant American carriers, and Orbitz, an online travel agency, filed a federal lawsuit demanding damages “in excess of $75,000” against Aktarer Zaman, a recent college graduate and the creator and owner of the website Skiplagged. The service enabled users to discover cheap airfares that did not appear on competing engines’ searches by utilising a tactic known as “hidden-city ticketing”, which takes advantage of occasional anomalies in airlines’ pricing algorithms.Ever since America deregulated air travel in 1978, the leading carriers have developed “hub-and-spoke” route networks, which require passengers to connect through a few strategically located airports en route to most destinations.A side effect of this model is that each carrier tends to dominate the market at its hubs, which gives it significant pricing power. Delta, for example, transports three-quarters of passengers at Cincinnati/Northern Kentucky International, a big reason why that airport is the most expensive to fly through in America.In contrast, non-hub cities, as well as markets so big that no airline can afford to ignore them, such as New York and Los Angeles, tend to offer much more competitive fares.Seeing a problem that called out for automation, Mr Zaman set up Skiplagged, which listed hidden-city options alongside conventional fares (with a “NO CHECKED BAGS” disclaimer), and linked to Orbitz to reserve them.

Economist 5/15/14

1. Summary execution is a common fate for Kenyan criminals.Even criminals who make it to court may still face an extrajudicial death. Bail is easy to get and court dates often missed. But victims can pay corrupt policemen to bring fugitives back—to be shot on arrest. The UN, whose agencies have a large presence in the capital, reckon the number of burglaries in Nairobi doubled to 300 from the last quarter of 2013 to the first quarter of this year. Private security companies, who are reckoned to employ more than 100,000 people in Nairobi, are thriving.Political violence is rising, too. Though Kenya avoided bloodshed during last year’s elections, it has since experienced a rash of terrorism and clumsy counter-measures by the police. The main problem is that the police are underpaid and phenomenally corrupt, with little respect for the law. The lowliest guards working for private security companies are far better paid than their counterparts in the police. Traffic police, for instance, routinely stop drivers for spurious reasons, expecting a bribe in return for letting them proceed.Kenya does not even have a public telephone number for people to ring in an emergency. Kenya is one of the world’s five leading countries in terms of the funds it gets from the United States for combating terrorism. Last year it got $8m.
2. Egypt’s economy is a mess. Tourism, a mainstay before the “revolution” in 2011, collapsed. Abdul Fattah al-Sisi, an ex-field-marshal who is almost certain to win the presidential election on May 26th, is likely to end Egypt’s brief experiment with non-military rule. Yet foreign firms, though wary, have not abandoned Egypt. With about 90m people, it is the region’s most populous country and still a cultural trendsetter in the Arab world. Dove soap and Pantene shampoo sell well. Procter & Gamble, a consumer-goods giant, reckons that its products reach nine out of ten homes. Carrefour has more than 20 stores in Egypt. After much delay, IKEA opened a furniture store at the end of 2013.  Coca-Cola, which already exports to more than 40 countries from Egypt, said in March that it would invest a further $500m there.In April the government enacted a new investment law, mainly to stop people from challenging contracts that investors signed with the pre-revolutionary government. But Egypt must do more if it wants to woo investors. It ranks 128th out of 189 countries in the World Bank’s league table for ease of doing business.
3.  In London, house prices are already 25% above their 2008 peak, and are now rising at a rate of about 18% a year. The average home in the capital costs more than £450,000 ($760,000); in some neighbourhoods the average house price is more than ten times the average income.One cause is financial. Thanks to government subsidies, 95% loan-to-value mortgages (for which the buyer needs a deposit worth only 5% the value of the house) have reappeared. Meanwhile, thanks to the policies of the Bank of England, interest rates are low, meaning people can afford to borrow large amounts.The London phenomenon is due to a restriction of supply at a time of soaring demand.n London and the south east, by contrast, tight planning rules and a shortage of land mean that relatively little new housing is being built, even as a booming economy and spectacular population growth create lots of demand for it. Tight “green belts”—areas in which most new construction is banned—surround London and small.
4. China National Offshore Oil Corporation towed a $1 billion oil rig into waters just 120 nautical miles (220 kilometres) off central Vietnam’s coast. To make that perfectly clear, it sent a flotilla of ships, which Vietnam says included armed vessels. This is all taking place not far from the Paracel islands, which China seized from the American-backed South Vietnamese regime in 1974. Vietnam is indignant. On May 11th, at a meeting of the Association of Southeast Asian Nations in Myanmar, the prime minister, Nguyen Tan Dung, vowed to protect his country’s sovereignty.Vietnam has a modest navy and little hope of sending the oil rig packing, let alone retaking the Paracels. Also on May 11th an unusually large demonstration against China took place in Hanoi; similar demonstrations happened in other big cities. Popular anti-China sentiment will be a delicate issue for the Vietnamese government.
5.  The ballot for elections to the European Parliament is from May 22nd to 25th. Many of those who do will back populists and extremists. Broadly anti-European parties may take well over a quarter of the seats. The French National Front, the Dutch Party of Freedom and the UK Independence Party are likely to win their highest vote ever.o. The last crisis may be over, but it has exacerbated a deep contradiction at the heart of Europe—between euro-zone economies’ need for integration and the voters’ rejection of it. The last crisis may be over, but it has exacerbated a deep contradiction at the heart of Europe—between euro-zone economies’ need for integration and the voters’ rejection of it. . Unemployment remains horrific: as many as 26m people in Europe are now out of work. Almost everywhere debt is dangerously high. With banks fragile, credit is hard to come by, and parts of Europe are on the verge of deflation.If the EU is to gain democratic legitimacy, it will do so not through the European Parliament but through national parliaments. That means giving powers back to them wherever possible, including greater fiscal flexibility and more national control over social policy and employment rules. It also means that national leaders must take responsibility for economic reform, rather than hiding behind the convenient fiction that painful choices are being forced on them by bad people in Brussels or Berlin.