[news week] october 25 2010
TRANSCRIPT
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u n d e r t h e P a n A m e r ic a n C o n v e n tio n . R e g is te r ed in t he P h il ip p in e s P a te n t O f fi c e .ln t h e U . s. A .: P o s t m a s te r : s e n d a d d r e s s c h a n g e s t o N e w s w e e k I nt e rn a t io n a l, 3 9 5 H u d s o n S tr e et , N e w Y o r k, N Y 1 0 0 1 4 -3 6 6 9 ; s ec o n d -c la s s p o s ta g e p a id a t L o s A n g e le s , C a l i f or n ia , a n d a t a d d i tio n a l
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Daniel Lyons's article states that Android
contains 11million lines of source code
and was written by a "small team of engi-
neers." Either this was the most produc-
tive group of engineers in the world or the
team was not small. I found two different
studies suggesting that no more than 200.
lines of code per month is reasonable.
Even if the Google engineers were five
times as productive, it would still take
11,000 engineer-months (roughly 900
engine~r-y~ars) to generate that code. If
the project took five years, and the team
grew linearly over time, the team would
have grown to $60 software engineers
(not counting supporting workers) at the
time of the first release. I don't know too
many people who would consider that a
small project team.
ERIC ROSENFELD, GLOUCESTER POINT"
VIRGINIA
' I F Y O U B U IL D I T . . . '
Ezra Klein's column noted that the stimu-
Ius may be good for the economy as
well as being a bargain. What he omit-
ted was the best rebutta(to those who
claim that FDR's stimulus during the
Great Depression didn't end the down-
turn: if we didn't have the Tennessee
Valley Authority for power produc-tion and other infrastructure projects,
4 ~mOCTOBER 25, 2010
for the younger Kim. With Jang pulling
the strings, don't expect the new Kim to
bring any change for the better.
MARIANA ESCARZAGA HERRASTI,
MEXICO CITY, MEXICO
O C T O B E R 1 1 , 2 0 1 0
' A N D R O I D I N V A S I O N '
we would all be speaking German now.
DAVID J. MELVIN, CHESTER, NEW JERSEY
'S O R R Y , S U D A N '
In this article (Oct. 4), Kevin Peraino
overplays America's impulse for re-
form. He should have mentioned that
America's story is more one of cold-eyed
pragmatism than crusading moralism.
During the past few decades, presidents
have said sorry not only to the Sudanese,
but also to the Kurds in Iraq and the Tut-
sis in Rwanda, among others.
LEE P. RUDDIN, CHESHIRE, ENGLAND
'A N E W S H E N ZH E N '
At the core of the Kashgar project (Oct.
4) lies China's unswerving ambition to
expand its sphere of influence. Trans-
forming this little-known town into a
Imajor business hub is an example of
how China is trying to broaden its global
infl~ence as never before. The question
is how the country will deal with politi-
cal volatility in the areas surrounding it.
RENJU RAVEENDRAN, KERALA, INDIA
' T H E R E G E N T B E H IN D T H E S O N '
As Jerry Guo explains (Oct. 4), Jang
Song-tack, the brother-in-law of Kim
jong-il, has become the North Koreanleader's right-hand man and the regent
t@
Letterstl) t"eE •W I en am e a nd a dd re ss , s ho uld b e e -m a ile d
to le t [email protected] o r fa xe d to
1-212-445-4120. L ette rs m a y b e e d ite d fo r
r ea so ns o f s pa ce a nd c la rit y.
Subscription inquiries for readers inall countries except Japan and thePhilippines should be sent to:
As a computer geek, Irecognize that Android is great because it
allows people to customize their operating systems. That leads to a
competition in which computer lovers vie to create the best machine.CARLOS ALMERAZ, MEXICO CITY, MEXICO
Pub li sh e rs ' Se rv ic e s Inc .O ~:
, Ph i l ipp ines'8.44-9217 Fax: 02-8.43-8.8.46
ail:Gustomersvc.ph iUppines@neWswee k.co
w.newsweekasia .com
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I WORLD VIEW I
H O W R U S S I A L O S T
I T S M O J OB Y R U C H IR S H A R M A
WHILE ECONOMIC GROWTH IN MOST EMERGING MARKETS
has returned to levels that prevailed during the boom years of
2.003 to 2.007, Russia is struggling to shrug off the "new nor-
mal" ball and chain. Two years after the global financial crisis,
it is one of the few developing countries where growth fore-
casts are still being downgraded.
The country suffered one of the worst declines, with the
economy contracting more than 10percent on a peak-to-troughbasis. Of all the major 'emerging markets, Russia will likely be
the last to recoup itslost output; the economy is set to return to
its pre-crisis peak only by the end of 2.011.
So why has Russia lost its mojo? After all, in the last decade
it grew at the same pace as the average emerging market, off the
back of the global liquidity glut and soaring commodity prices.
Those factors are once again propelling peers like Brazil, but
Russia has yet to partake in the current boom.
It seems Russia's economic model is in need of a major recast
"forthe country to move to the next stage of economic develop-
after their per capita income crossed $10,000 because these
nations created an environment in which small and midsize
businesses could prosper. Russia.iby contrast, has a"smaller
percentage of small and medium enterprises (SMEs) as a share
of overall business than any of the world's major economies.
World Bank surveys rank Russia izoth out of 183 countries
for the ease of doing business. Budding entrepreneurs cite
the maze of bureaucracy, poor contract enforcement, and thelack of access to easy credit as major impediments to growth.
Thanks to an underdeveloped banking system, Russian SMEs
pay interest rates of 15to 2.0percent, and the mortgage market is
virtually nonexistent. Russia's loan-penetration ratios are simi-
lar tothose of countries such as Egypt that have a far lower per
capita income. ,
Indeed, the Russians ran into serious trouble during the
2.008 global financial crisis because many corporates bor-
rowed heavily from overseas between 2.003 and 2.007, result-
ing in a panic in the domestic marketplace when that source
of funding dried up.' Steps to improve the
banking system will go a long way toward
increasing Russia's domestic savings and
investment ratios. With the share of invest-
ment in the economy at a low 2.0percent, the
cracks in infrastructure are only too visible-
witness the jammed roads of Moscow and an
archaic rail network that connects the capital"
city to the hinterland.
It's incredible that even with oil at $80 a barrel, Russia's
government requires help from the private sector and foreign
investors to build out its infrastructure. Nearly two thirds of
government expenditure goes toward social spending, andthe country's budget deficit is currently 4 percent of GDP.
Fortunately, the penny is beginning to drop among some
policymakers that Russia needs a sea change in its economic
direction. One marquee project designed to move the country
up the high-tech ladder is the new science center Skolkovo,
under construction near Moscow, and billed. as the country's
answer to Silicon Valley. Russia certainly has the human capi-
tal to succeed in scientific and medical areas.
However, it is imperative for the authorities to understand
that a richer Russia requires less top-down management and
more individual enterprise. When Russia was a poor country,
abundant in natural resources, it required a strong government.A decade later, a more developed Russia needs a new model.
A heavy-handed, centralized form of
government (the state is 50 percent of the
economy) is thwarting Russia's success.
ment. At the end ofthe 1990S Russia's economy was in complete
chaos, and its per capita income was a poor $1,500. It needed
strong political leadership to stabilize the system, and it got that
from Vladimir Putin, who took over as president in 2.000. Rus-
sia was subsequently able to participate in the wider emerging-market renaissance that followed.
But a decade later,with aper capita income ofmore than $10,000,
the rules of the game have changed. Success carried too far can
become a country's weakness. A heavy-handed, centralized forin
of government (the state's share in the economy is now a massive
50 percent) is thwarting Russia's further economic progress.
An old rule of development economics is that a rich nation
produces rich goods. For Russia to become a fully industrial-
ized country, it needs to move beyond natural.resources and.
into more innovative and tech-savvy industries. To do that, it
must dramatically improve the investment climate by clipping
the government's tentacles at every level.South Korea and Taiwan were able to grow at 6 percent even
6 r n OCTOBER 25, 2010
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I SCOPE II INTERNATIONALIST
R A I TT E N S I O N S S T I L L H O TBY ISAAC STONE FISH
CHINAS RECENT BELLIG-
erence toward Japan has
worried its neighbors, including Taiwan,
which the mainland regards as a prodi-
gal son. China has been drawing Taiwan
closer with improved trade links, and the
June signing of a breakthrough free-trade
agreement between the two entities will
bind Taiwan's economy even tighter to the
mainland's. Yet while both sides speak ofimproved relations, economic ties haven't
led to substantial political improvements.
Infact, military tensions between the two
are increasing. Despite Chinese Premier
Wen jiabao's vague reassurances that his
and 9 percent wanted reunification.)
The Chinese government's aggressive
territoriality, coupled with its refusal to
undertake meaningful political reform,
fosters the deep-seated hesitance .thatcharacterizes Taiwanese views of unifica-
tion: the same poll found that 54 percent
ofTaiwanese residents had negative views
of the Chinese government, Viewing it as
tyrannical and autocratic. Despite decades
of economic reform in Beijing,the differ-
ence between the two government's politi-
cal systems is sharp.
China has long claimed Taiwan as one
of its "core interests"; it has also recently
included the South China Sea on that list,
which also cites Tibet and Xinjiang, andrefers to issues for which it allows no com-
promise. But until China can convince the
Taiwanese that it has their best interest
in mind, it might just have too many core
interests to juggle.
government will withdraw i.eoo-plus
missiles pointing at the island, Taiwan's
deputy defense minister has said that
the mainland military threat is growing.
Taiwanese president Ma Ymg-jeou justannounced that the country will keep
buying arms internationally, and China's
defense minister, in a recent meeting with
his U.S. counterpart, said that Taiwan
remains the main point of contention
between the two superpowers.
Although tensions are much lower than
they were under Ma's pro-independence
predecessor, peaceful reunification-the
holy grail ofChina's Taiwan policy-seems
less and less likely: a study published
in September by the Taiwanese UnitedD a ily N ew s revealed that 16percent ofpar-
ticipants support full independence while
only 5 percent want reunification with
China. (The same study in 2000 showed
that 12 percent supported independence
A F U T U R ER E S T S O N E L E C T I O N SBYJACOB KUSHNER
8 m OCTOBER 25. 2010
FAIR AND INCLUSIVE
elections in Haiti may
prove impossible. When the country
goes to the polls on Nov. 28 to choose a
new president, the post-quake logistics
present huge challenges: some 230;000
dead have to be purged from voter rolls
and 1.3 million more displaced have to
be reregistered .:
But an even greater threat is actu-
ally Haiti's electoral commission itself,
which is under fire for sidelining 15
candidates without explanation and
excluding the Lavalas party, which
stands in opposition to the current pres-
ident, Rene Preval. In this case, shoddy
democracy bears a danger that could
. have long-reaching consequences. If
Haitians don't trust their government,
they could hinder the reconstruction
process b resisting the government's
attempts to evict them through eminent
domain, or relocating to a new displace-.
ment camp. In Haiti's history, lesser
things than mass evictions have sparked
riots and brought the country h) a stand-
still. Furthermore, international inves-
tors and donors are likely to be skittish
about a government tainted by illegiti-
macy. "Flawed elections now will come
back to haunt the international com-
munity later," 45 U.S. representatives
recently wrote to Secretary of State Hill-
ary Clinton. Port-au-Prince may end
up with a strong leader. It also needs a
legitimate one.
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L O N D O N M E D I AT U R N S O N I T S B A R O NBY WILLIAM UNDERHILL
MEDIA BARON RUPERT
Murdoch is once again
setting his sights on London. His
$54 billion News Corp., which already
owns The Times ofLondon and tabloid
TheSun, now plans to shell out $12bil-
lion for a full takeover of broadcaster .
Sky TV. If the deal happens, media
analyst Claire Enders has predicted
that Murdoch will control half of the
UK.'s _newspaper and TV markets
within a decade.
In a rare show of unity, Murdoch's
rivals in the British media are clam-
oring for the government to block
the sale. His papers may have backed
David Cameron's Conservatives
in the election, but Murdoch is not
likely to get the government's bless-
ing now. For one thing, Cameron's
party failed to win an outright vic-
tory despite Murdoch's support. For
another, the decision on whether to
allow the takeover belongs to. busi-
ness secretary Vince Cable, a fiercely
pro-regulation Liberal Democrat
. who recently raised a storm by pub-
licly warning that "capitalism takes
no prisoners, and it kills competition
when it can."
W H I C H C O U N T R Y\ W I ' l l S E E T H E N E X T M IN I N G D I S A S T E R ?
--.,.---w AFTER THE LAST CHIL-
................... ean miner was rescued
from the San Jose mine, rescue worker
Manuel Gonzalez ascended from the
700-meter-deep drill hole, and Presi-
dent Sebastian Piiiera asked what he
was thinking on the way up. Gonzalezreplied: "That hopefully things in Chil-
ean mining will now be different." This
near-tragedy will surely bring about
changes in Chilean mining. But several
other countries are in line for the next
big accident ifthey don't also take a cue.
Topping the list is China, with 2,631
accidental miner deaths last year, fol-
lowed by some former Soviet states
(Kazakhstan, Ukraine, Russia), as well
as Colombia and Turkey. Statistics
vary, as many accidents are not evenreported, but the International Federa-
BYJIMMY LANGMAN
tion ofMine Workers' Unions estimates
that overall, 12,000workers die in acci-
dents each year. Mining has always
been a risky activity,but experts blame
lax laws and enforcement, inadequate
worker training, and low investment.
in technologies for the unusually highaccident rates in some countries.
Workplace accidents are not the only
worry. InJuly, the Chinese mining com-
pany Zijin caused a massive acid-waste
spill in the Ting River that poisoned
drinking water for some 60,000 people.
Zijin has been moving to expand into
other nations, such as Peru, which is
a worrisome trend, says Keith Slack, a
senior policy adviser at OxfamAmerica.
These. countries must push for reform.
The next mining disaster is unlikely tohave such amiraculous ending.
NEWSWEEK.COM m e
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I SCOPE I BUSINESS MATTERS
N O T E N O U G H C H I E F SBY MCKAY COPPINS
A GOOD BOSS IS HARD
to find. Make that very
hard, according to the
annual Manpower labor
survey, which listed
"executive/management"
slots among the five
hardest positions to fill in
2009, even as unemployment topped10percent. Now, with an estimated 10
million baby boomers eligible to retire
by the end of the year, economists
seem more worried than ever about
an impending "corporate-leadership
crisis." Theories abound to explain the
workplace phenomenon, but Stan-
ford business professor Jeffrey Pfeffer
may have cracked the case by observ-
ing his students. "The problem," says
Pfeffer, 'author of the new book Power:
Why Some People Have It-and OthersDon't, "is that ambition has become
unfashionable in the younger seg-
ment of the workforce." Whereas
motivated young professionals used
to slug it out for coveted
promotions, many of
today's B-school gradu-
ates find such interoffice
competition uncouth. Fa-
mously team-oriented,
millennials would rather
collaborate with their co-
workers than compete.Pfeffer blames this attitude on a cul-
ture of coddling, one that allows high
schools to appoint multiple valedicto-
rians and gives trophies to both T-ball
teams, regardless of who wins. Still,
the current climate, where even a little
gumption stands out, could be good
news for go-getters. InPower, Pfeffer
writes about a young Deloitte recruit
who not only insisted on meeting with
the CEO before taking the job, but also
requested a yearly dinner with him(which he got). That kind of audacity
may not make you a lot of friends in
the modern workplace-but it can get
you a corner office.
SOURCE: THESTREET.COM, EMPLOYEE BENEFIT RESEARCH INSTITUTE
10 [3 OCTOBER 25, 2010
C O N V E N T I O N A L W I S D O M
T H IN K A G A I NFinally, world leaders made
headlines that had little to do with
the global fmancial crisis:
P I N E R AAll 33 miners safe,
and the president was
there to greet them
all. A triumph for
Chile-and for Pifiera.
O B A M AIn '08, Dems rode into
Congress on Obama's
coattails. Now he's
hurting their chances
more than helping.
A H M A D l N E J A DFiery Iran leader visits
Lebanon, call~ Israel t V
"mortal." But back
home, his problems
continue to pile up.
Calls on China to
end censorship and
is backed by high-
profile party elders.
Is reform nigh?
S A R K O Z YFrance erupts in
strikes over pension'
reform, but Sarko's
gambling they'll
fizzle out soon.
C H A V E ZWith alleyes on Chile,
signs nuclear deal
with Russia. Trying
to steal the LatAmspotlight?
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I SCOPE I TECHTONIC SHIFTS
G O O G l EI N P R IM E T I M E
BY DANIEL LYONS
FOR THE PAST FEW YEARS, TECH
companies have been trying to, find away to bring the Internet and televi:
sion together, without much success.
Sure, there are lots of little boxes you
can attach to your TV that let you
download content from the Internet, .
but each one gives you a little some-
thing different, and none delivers the
entire Web. Now Google is out to
replace all those crazy little boxes with
Coogle TV. It's software, built right
into some TV sets, and it will basically
turn your TV into a computer.
"We've seen how the Web has
transformed the mobile industry. The,
next device is the TV," says Google's
Rishi Chandra. With the new, prod-
uct, you'll be able to turn on your set
and get a home page from Google TV.
You'll surf the Web and load apps like
Twitter and Pandora the way you do
on a smart phone. You'll view photo
albums stored on your home network
and stream movies from Amazon.And you'll be able to use your smart
phone as a remote control. '
Just as with Android for mobile
phones, Google makes the underly-
ing code available to anyone who
wants to build apps for it. With any
luck, this will start a wave of in-
novation like the one that has hit the
mobile-phone space, where hun-
dreds of thousands of apps have been
created in just the past few years. As
Google says, "The coolest thing aboutGoogle TV is that we don't even know
12 m OCTOBER 25, 2010
also a $299 box from Logitech,. called
Revue, that runs 'Google TV softwareand includes a fancy keyboard.
The problem is that people really
don't want to buy a separate box, as '
Apple CEO Steve Jobs pointed out
a few months ago. Apple has since
updated' its own box, the $99 Apple
TV, but it gives you access only to
Apple's iTunes store and a few part-
net sites. Apple could follow Google's
lead and try to get its software embed-
ded into TVs made by others. But
that isn't the Apple way-Jobs would
sooner develop his own TV. ,
The bottom line is that weare'enter-
ing a new era where the stuff we think
of as "TV" becoines just one channel
alongside all this other stuff from the
Internet Instead 'of a few hundred
channels, we'll now have hundreds '
of thousands. Geeks will love it. But
ifyou're the type who can't program a
DVR, it'll probably be a nightmare.
what the coolest thing about itwill be."
Google gives the software away toany tv maker. Why? To get more peo-
ple using Gmail, YouTube, Google
Maps, and its other' online services,
where they will be exposed to Google's
ads. "People spend five hours a day
watching TV, and we have no way to
distribute our services to those users,"
Chandra says., "We want to have
access to people wherever they are."
The downside to Google TV is that
it comes from Google, a company that
has never been very good with user-
interface design and has little experi-
ence dealing with consumers. My fear
is that the product will have lots of
great features but will be too complex
for the average person.
Over time, though, I believe software
like, this will be standard on all new
sets. Google TV will come preloaded
on some Sony units this fall, and in
more sets over the next year. There's
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'We must prepare
for-them ...theyare
coming back fromthe dead.'LILLIAN RAMIREZ,
the girlfriend of one of the
Chilean miners rescued after 69 days
underground.
'Weboth love our
country. That has tobe the mindset here.'
HILLARY CLINTOl'i!, ,
speaking to students in Sarajevo
and offering her contentious history
, with President Obama-and their
reconciliation-as a model for Bosnia .
.'Freedom of speech
is indispensable for
anycouhtry.'Chinese Premier WEN JIABAO,
,in the latest in a string of increasinqly
bold statements calling for reform
ahead of the Chinese Community
party's annual conference.
'We can havea man like Mr.
Ahmadinejad here
right under their
noses, and they can
do nothing about it.'MOHAMMAD NASR,
a Lebanese carpenter, praising the
president of Iran's visit to his country
as a sign of strength against Israel.
PERSPECTTVEslSCOPEI
'1 think it was my
father who made
the decision ...1 don'tcare at all.'KIM JONG-NAM,
Kim Jong-il's eldest son, who
came out against dynastic succession
in North Korea as his little brother
prepares to take power in the country.
'Awarding the
.'..Nobel Prize to him
is equivalent to
encouraqinq crime.'MAZHAOXU,
a Chinese Foreign Ministry
spokesman, denouncing
international calls to release jaileddissident Liu Xiaobo.
© 20'10 PA, ,-KER-FLORIDA TODA:Y
NEWSWEEK,COM m 13
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Breaking theLaw
Why Russia fetes its criminals.
a defeated country,'
says Gorbachev.
'We try to provethan i'I'unes. Both have we are not.'now been closed down at
the insistence ofthe World Trade Organi-
zation, which Russia hankers to join. But
Russia's proud copyright infringers are
so devoted to the principle of not paying
for music and movies that some have even
formed. a political movement called the
Pirates' Party. The new "party" -which
has little hope of ever being allowed to
stand for office-advocates formalizingRussia's status as a n offshore haven for
copyright violators.
B
IN SOME· COUN-
tries' it's cool to be
an outlaw. In Monte-
negro, for instance,
members of a local
diamond-heist gang
known as the Pink
Panthers are localheroesforrippingoff
posh Western jewelers. Likewise, many
Iranians cheer their bumptious presi-
dent because, as one Iranian friend put
it, "Idon't agree with him, butI like how
he stands up to America." North Korea
bas elevated this kind of rebellion into a
tate philosophy. "If you can't join 'em,
beat 'em" seems to be the guiding prin-
ciple there.
It's sad to see Russia following suit. Mos-
cow may not be building secret nuclear
bunkers. But it does have a disturbing pat-
tern of sheltering law-
breakers from interna-
tional justice. Take
copyright infringement,
for instance. Russia has
been host to two of the
last decade's most notori-
ous pirate sites, torrents
.ru and ' allofmpg.com.
The latter at its heighthad more subscribers
'America
treated us like
18 m OCTOBER 25, 2010
More serious examples of Russian
outlaw worship have included accused
killers, spies, and crooks who have not
only found safe haven in their home-
land but often been treated as heroes.
For instance, Andrei Lugovoi, the ex-
KGB officer who has been accused by
British prosecutors of murdering Alex-ander Litvinenko, a Russian defector,
in London in 2006, became a national
hero and was elected to the State
Duma, thereby giving him immunity
from prosecution. Anna Chapman,
the beautiful Russian agent recently
arrested by the FBI and returned to her
homeland in a spy swap, was feted by
Prime Minister Vladimir Putin, and
also offered a political career in the
same party that adopted Lugovoi.
The latest' in this litany of no-good-
niks 'who enjoy official protection
are 60 officials and
policemen associated
with the false impris-
onment and death in
prison of Hermitage
Fund tax. lawyer Ser-
gei Magnitsky in 2009.
Magnitsky had discov-
ered that companies be-
longing to Hermitagehad been stolen by
crooked cops and used
to defraud the Russian
government of $230 million. Instead
of investigating his accusations, police
threw Magnitsky into jail, where he died
after being denied medical care. Last
week the U.S. Congress, after months
of lobbying from Hermitage, passed the
Justice for Sergei Magnitsky Act, which
forbids entry to the U.S. to individuals
named in court and police documentsrelated . to the Magnitsky case. The
new law, says its cosponsor Sen. John
McCain, is intended to "identify those
responsible for the death ofthis Russian
patriot, to make their names famous for
the whole world to know, and then to
hold them accountable for their crimes."
The Russian response was essentially
that these guys may be sons of bitches-
but they're our sons of bitches. The Rtis-sian Foreign Ministry condemned the
law as being "beyond the standards of
decency," while the Interior Ministry
promoted one of the investigators most
active in imprisoning Magnitsky.
What's behind Russia's rallying
around its outlaws in the face offoreign
attack or criticism? Mikhail Gorbachev
put his finger on one key reason in an
interview with NEWSWEJilK last year:
''America treated us as though we were a
defeated country," he told me. "Now we
try to prove that no, we are not defeated,
we have our own policies, we will not
obey ... even though that sometimes
prevents us from seeing how much we
have in common." Russia stands by its
badasses, to follow Gorbachev's logic,
because it's more important to prove
that Russia is independent than to prove
that it is a member in good standing of
the international community.
There's another, more depressingcause fo~ Russia's behavior: bureau-
crats covering their own backsides
from international scrutiny. Russia as a
country has nothing to gain from pro-
tecting its outlaws,' its killers, and its
corrupt officials. But as the Magnitsky
case and others like it show, Russia's
bureaucrats have a lot to lose if their
own practices come under the scrutiny
of international law enforcement. Then
they would have to face justice=not the
corrupt, back-scratching, politicallymotivated parody, that exists in Russia,
but the real thing.
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The Prepaid NationNew businesses target the 'unbanked.'BY DANIEL GROSS
These business
models have
. THE LIST OF COM-
panies lining up to
sell shares to the
public can tell you a
lot about what trends
are hot in the global
economy. Some re-
cent filings include
First Wind Holdings
(wind farms!), SinoTech Energy (China!
Oil!), and Campus Crest Communities
(fancy housing for rich college students!).
Then there's NetSpend, which is seeking
to raise $200 million.
NetSpend, based in Austin, Texas, is
what you might call an inverted credit-
card company. Its products are pre-
paid debit cards that can be loaded
with cash by employers, or govern-
ment agencies, or retailers-kind of likegift cards for everyday use. Its customers
are the legions of the
"unbanked," people who
don't have bank accounts
or credit card's, but
who earn, receive, and
spend money. Between
2005 and 2009, Net-
types of arrangements are typical of
developing-world countries that lack
financial infrastructure and a culture of
credit. And while the hysterical claims
that the U.S. is losing its First World sta-
tus as a result of the recession are over-
blown, Americans have become more
receptive to business models that might
not have made sense in the credit-fueled
haze of 2005 and 2006.
The debit-card industry isn't the only
large sector that has glornmed on to
business models previously seen only in
places like sub-Saharan Africa, Tracl'one
Wireless-a unit of Mexico's America
M6vil, the largest cell-phone company
in this hemisphere-boasts 15 million
prepaid subscribers in the u.s. In its
most recent quarter, Sprint reported that
profits from its U.S. prepaid wirelessbusiness doubled to $928 million from
469 million a year,
while profits from its
(traditional) postpaid
business fell 7 percent.
Inthe past year, Sprint
has seen its prepaid cus-
tomer rolls more than
double, from 4.7million
to 11million. "Last year
was the year of pre-
paid voice," said CarrieMacGillivray, program
manager at consulting
firm IDC. "And this year we're seeing
more interest in prepaid data services."
A few factors account for the. surge
in prepaid businesses. Lots of people
who need and want phones in the U.S.
don't have the desire to get locked into
a multiyear contract, .or the means to
pass a credit check. In 2010 a bigger
slice of the population falls into that
category than did in 2007. The FederalDep~sit Insurance Corporation says
spend's revenues rose 'their origins infivefold and net income
surged from $700,000 countries with
to $18.2million. Lastjune lowwages, and poorNetSpendreported 2mil- living standards.lion active cards and " "
$8.8 billion in transactions conducted
in the previous 12 months. NetSpend is
following a larger rival, Green Dot, into
the public markets. Green Dot has a
relationship with Walmart-the giant
retailer pays some of its employees by
giving them loaded debit cards. In the
second, quarter; Green Dot says its
business soared 77 percent from the
year before.Welcome to Prepaid Nation. These
that about 60 million adult Americans
are "underbanked" -i.e., lack full access
to financial services. Only 16 percent of
them use prepaid cards.
Some analysts may view the rise of
prepaid as a sign of regress. After all,
these are business models that have
their origins in countries with low
wages, unsophisticated financial mar-
kets, and poor living standards. Life is
a lot easier when you don't have to pay
cash-in advance-for the stuff you
need to get through the day.
But I'd prefer to see the glass as half
full. The swift rise of prepaid shows the
capacity of U.S. businesses to adapt.
Prepaid arrangements are generally
, geared toward bringing new people
into systems. With prepaid mobile serv-
ice, a college student may occasionallytun out of minutes. But she'll never
pay 19 percent interest on the monthly
charge for a plan because she put it on
a credit card. Meanwhile, Sprint doesn't
have to worry about bad debt and
unpaid bills.
Infact, it would be a good thing ifmore
of us prepaid. Prepaid consumers are
more likely to adopt an eat-what-you-
need strategy rather than an all-you-
can-eat one. (At Sprintin the most recent
quarter, the average prepaid customerspent $28, about half what the postpaid
customer spent.)
Prepaid is likely to grow for macro-
economic reasons, as well. In a world .of
high inflation, buying now and consum-
ing later is a very bad idea. In a world of
stable prices, the purchasing power of
today's dollar might rise. Over the last 12
months, the consumer price index-the
main gauge of inflation-s-has risen just
1.1percent. Pay now, buy later.
GROSS is ec ono mic s edito r fo r Y ah oo F inanc e.
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Circle of TrustObama needs some new blood.BY EZRA KLEIN
FIRST PETER ORSZAG
turned in his ID
card. Then Chris-
tina Romer went. In
short order, Larry
SUmmers and Rahm
Emanuel announced
their exits. Jim Jones
is gone, too. Thereare a lot of empty desks in the White
House these days.
But that leaves room for new people
to fill them. So far, President Obama has
hired mostly from within. Thafs a sign
he's happy with the advice he's received.
And in many ways, he's right to be. This
administration entered office with the
economy teetering on the edge of the
abyss. His team has successfully pulled
us onto firmer ground.
The next two years, however, will
see resurgent Republicans and new
problems-not to 'mention continued
slow growth. For that, the administration
needs a new agenda, and new ideas. To get
them, here are four candidates the White
House should hire. (Disclaimer: I didn't
tell these people I'd be mentioning them.
and I'm not close with any of them. This is
about their ideas, not their personalities.)
Karen Kornbluh In. a previous life,
Kornbluh was Senator Obama's policy
director. Now she's serving as ambas-
sador to the Organization for Economic
Cooperation and Development. It's not
exactly hard time; she. gets a house in
Paris. But Obama needs to call her back.
The administration has done impor-
tant work expanding and strengthening
the safety net. Now they need to turn to
the focus of Kornbluh's work: modern-
izing it. Our safety net was developed in
an age when men were the breadwinners,
women stayed home to raise children,single-parent families were rare, and work-
20 m OCTOBER 25, 2010
ers tended to stick with a single employer
for decades. Now it needs to be updated
for a world where families are dependent
on two incomes, have lessjob stability, and
need time off from work to care for sick
parents and young children. Kornbluh is
the right pick to lead that effort.
Mark McClellan McClellan led the
Centers for Medicare and Medicaid Ser-vices for George W.
Bush. He was instru-
mental in implementing
the Medicare prescrip-
tion-drug benefit. That
gives him two things the
administration needs:
credibility with Repub-
licans on health care
and experience making
a major health-care ini-
tiative work
Mcolellan has been
those in power. It's hard to imagine him
playing well with others in the White
House, but then that's the point: he'll say
things they don't want to hear.
Christina Romer Yes,Romer. Shewon't
bring a new perspective, but she brings the
right perspective. In her final speech as
chairwoman of the Council of Economic
Advisers, she offered the full-throated callfor more fiscal stimulus
that the administration
has largely abandoned." " -"Concern about the.defi-
cit cannot be an excuse
for leaving unemployed
workers to suffer;" she
said. "We have tools that
would bring unemploy-
ment down without
worsening our long-run
fiscal outlook, ifwe can
only find the will and
the wisdom to use them."
She's right. The stimulus may not
poll well, but it worked. Unemploy-
ment would\;'e been much higher in
its absence. Was it too small? Yes, and
Romer knew that at the time. She calcu-
lated that we needed $1.2 trillion. We got
a bit more than half that, and then the
economic crisis proved worse than we'd
thought it was when Romer was run-
ning the numbers.
Unemployment is now near 10 per-
cent, and though the stimulus probably
kept it from brushing 12 percent, the
economic misery has discredited the
intervention. The administration can't
hide from this fight, however. The job
situation is too grim for the government
to just leave the 'unemployed to their
fate. Romerrspeaking freely in her final
days in office, had it right. They should
have her and the others say what's ontheir minds more often.
It's hard to imagine
Baker playing well
with others in the
White House, but
then that's the point:
he'll say things they
don't want to hear.
a cautious friend and frequent critic
of Obama's health-care initiatives. He's
complimented the legislation for mak-
ing progress on coverage and payment
changes while criticizing it for falling
short on medical-malpractice reform and
consumer-driven policies. IfRepublicans
fail in their efforts to repeal the legislation
(as they likely will), some might be com-
forted by having a voice on the inside.
Dean Baker Think Obama's eco-
nomic team is too insular? Baker, a
contrarian economist who was among
the first to spot the housing bubble and
who's.been a critic of the administration
(and most everyone else), will fix that.
Baker can be counted on for innova-
tive thinking-How about doing away
with pharmaceutical patents? Or letting
foreclosed owners rent their homes? Or
slapping a transaction tax on Wall Street
to slow it down and reduce our deficit?-and a disinterest in currying favor with
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The Fed's Identity CrisisIts power has given way to doubt.BY ROBERT J. SAMUELSON
Its efforts haven't
stimulated much
borrowing by
anxious households
IT IS WIDELY, AL-
though not univer-
sally, assumed that
the Federal Reserve
will move in early
November to bol-
ster the economy
by trying to nudge
down long-term in-
terest rates on Treasury bonds, home
mortgages, and corporate bonds. Just
how much rates would decline and
how much production and employ-
ment would increase are uncertain.
What's clearer is that the move would
be something of an act of desperation,
reflecting a poverty of good ideas to
resuscitate the economy.
The Fed is suffering an identity cri-
sis. Celebrated under chairman Alan
Greenspan as a guarantor of prosper-
ity, it is now struggling
to regain its exalted
reputation. In the acute
phases of the financial
panic, in late 2008 and
the first half of 2009,
it devised ingenious
ways to provide credit
to parts of the financial
markets (commercial
paper, money-market and cautiousfunds) that were being businesses.abandoned by private
lenders. For almost two years, it's held'
its short-term interest rate near zero.
All this arguably averted a second Great
Depression, but it obviously did not
trigger a vigorous economic recovery.
Chairman Ben Bernanke makes peri-
odic speeches arguing that, despite lower-
ing its short-term interest rate to virtually
zero, the Fed' still has ample policy tools
to revive the economy and reduce theappalling levels of unemployment. The
reality is otherwise; the Fed's remaining
tools are arcane, weak, or both.
What the Fed is expected to authorize
in November is a large purchase of u.s.Treasury bonds with the intent of driv-
ing down their interest rates, and rates
on other long-term debt securities. Ithas
already done this once. In late 2008' the
Fed approved massive bond purchases;
these ultimately totaled $1.725trillion of
mortgage-backed securities, u.s. Treas-ury bonds, and Fannie Mae and Freddie
Mac bonds. Bernanke has said the pro-
gram "made an important contribution"
to the economic recovery.
But the measurable effects were
small. A Fed study estimated that
rates on all lO-year bonds might have
dropped by 0.6 percentage points. The
decline this time might be less, because
starting interest rates are already low
(about 4.g percent for a
go-year mortgage) and
the purchases might be
smaller. Guesses gener-
ally range from $500 bil-
lion to $1trillion.
Economists at Bank
of America think new
purchases would have
"only a modest impact
on the economy" butare "better than doing
nothing." A plausible
program might cut the unemployment
rate by 0.2 percentage points (say, from
9.6 percent to 9-4 percent), says Moody's
Analytics. The stock market would
be slightly stronger, leading people to
spend more, and a depreciated dol-
lar would aid exports. Indeed, because
Bernanke and other Fed officials have
signaled a new round of bond buying,
financial markets may already reflectsome of these effects.
Still, there are dangers. When the
Fed buys Treasury bonds, it pumps dol-
lars into the economy. So far, this hasn't
stimulated much borrowing by anxious
households and cautious businesses.
Outstanding consumer credit has been
dropping since the summer of 2008. In
part, the Fed is "pushing on a string."
Banks have excess reserves of roughly
$1 trillion. But if all the cheap money
eventually spurred much higher eco-
nomic growth, many of these reserves
would turn into loans and raise the
specter of higher inflation-vtoo much
money chasing too few 'goods."
The Fed would then have to with-
draw or neutralize the added money
through higher interest rates. Adding
hundreds of billions more to banks'
excess reserves won't make' the job
easier. As important, there would be
enormous pressure on the Fed not
to raise rates while unemployment
remains high. Economist Allan Melt-
zer of Carnegie Mellon University,
author of a three-volume history of
the Fed, fears that the Fed will-as in
the 1960s and 1970s-wait too long.
"Sooner or later, we'll have a big infla-
tion," he says, "but not right away,
because there's ne demand now."
Economists seem split into twocamps. Some, like Paul Krugman, the
New York Times columnist, believe the
economy is so weak that the government
should do almost anything (bigger deft-
cits, more cheap credit) that might help
slightly; and others, like Meltzer, fear
that expedient measures now will lead
to bigger problems later. Between them,
there's an unstated common assump-
tion that there are no instant cures for
the economy's lethargy. The real Fed, it
turns out, is much less powerful thanthe mythologized Fed.
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High-Tech HogwashWhat's wrong with Silicon Valley libertarianism?BY JACOB WEISBERG
that giving women the vote wrecked the.
country and still be taken seriously, I sup-
pose it helps to hand out $100 bills.
.What differentiates Silicon Valley's
style oflibertarianism from Glenn Beck's
raving-weeping variety is its laissez-faire
attitude toward personal behavior and
the' lack of demagogic instinct. Thiel,
. who is openly gay, wants to flee the mob,
not rally it through
gold-hoarding or flag-
waving. Having given
up hope for the United
States, he writes that
he has decided to focus
"my efforts on new
technologies that may
create a new space for
freedom." Both Theil's
entrepreneurship and
his philanthropy are
animated by techno-
utopianism. With PayPal, he sought
to create a global currency beyond the
reach of taxation or central-bank policy.
He sees Facebook as a way to form vol-
untary supra-national communities.
Offline, Thiel is the lead backer of
Seasteading, a movement to create law-
free floating communes and explore
space, with the avowed aim of creating
new political structures even fartheroffshore. That could take some time,
but Thiel has a plan for that too. He
has given millions to the Methuselah
Foundation, which does research into
life-extension based. on the premise that
humans can live to be 1,000 years old. At
PayPal, he proposed making cryogenic
storage an employee perk.
It should be noted that Thiel has also
supported some good causes, like the
Comm.ittee to Protect Journalists. But
his latest crusade is his worst yet, andmore troubling than the possibility of~ -
an unfrozen-caveman venture capital-
ist awakening in the sznd century and
denianding his space capsule. The Thiel
Fellowship will give entrepreneurs
under age 20 a cash award of sioo.ooo todrop out of school and pursue their busi-
ness ideas. In announcing the program,
Thiel made clear his' contempt for U.S.
universities, which, like governments, he
believes, cost more than
they're worth and get in
the w~)1 of what really
matters in life, namely
tech startups.
Where to start with
this nasty idea? A basic
feature of Thiel's world
view is its' narcissism.
Thiel fellows will have
the opportunity to emu-
late their sponsor by
halting their-intellectual
development around the onset of adult-
hood, maintaining a narrow-minded
focus on getting rich as young as possible
and thereby avoid the siren lure of help-
ing others or pursuing knowledge for its
own sake. Thiel's premise is that' Amer-
ica suffers from a deficiency of entre-
preneurship. In fact, we may be on the
verge of the opposite: a startup bubble in
which too many weak ideas find fundingand every kid dreams of being the next
Mark Zuckerberg. 'I
There is, of course,' another model
of. Silicon Valley politics, which finds
its exemplars in the clean-tech race, in
Google's ~elf.driving cars, wind farms,
and Bill Gates's philanthropy. Zuckerberg
himself shows signs of actually caring
about other people, having just donated
$100 million to support change in New-
ark; N.J.'s blighted public-school system.
Tech prodigies. sometimes grow up late!Here's hoping Thiel will one day as well.
IF YOU'VE SEEN THE
Social Network, you
may have caught
a glimpse of Peter
Thiel. He was the
first outside inves-
tor in Facebook,
putting up $500,000
to finance the site's
original expansion in 2004. Inthe film's
version of events, he connives with
Sean Parker, the founder of Napster, to
deprive Mark Zuckerberg's friend Edu-
ardo Saverin ofhis 30percent stake in the
company. Aaron Sorkin's screenplay dev-
astates the German-born venture capital-
ist in a line: "We're in the offices of a guy
whose hero is Gordon Gekko."
While he clearly enjoys playing Richie
Rich-profilers have commented onhis McLaren supercar, his apartment
in the San Francisco Four Seasons, his
white-jacketed butler='I'hiel fancies
himself more than another self-indul-
gent tech billionaire. He has a vision,
and has lately been spending some of
the millions he has made on Facebook
and PayPal-which he founded-trying
to advance it.
Thiel's belief system is a mixture of
unapologetic selfishness and economic
Darwinism. In a personal statementproduced last year for the Cato Institute,
he announced: "I no longer believe that
freedom and democracy are' compati-
ble." The public, he says, doesn't support
unregulated, winner-take-all capital-
ism, and so he won't support the public
any longer. "Since 1920, the vast increase
in welfare beneficiaries and the exten-
sion of the franchise to women+two con-
stituencies that are notoriously tough fon
libertarians-have rendered the notion of
'capitalist democracy' into an oxymonon,."he writes. Ifyou want to go around saying
Thiel wants to
flee the mob, not
rally it through
gold-hoarding orflag-waving.
22 m OCTOBER 25. 20.10
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~- 2010
10 Big Green
)
AT THE FIRST EARTH DAY PROTEST IN 1970, MARGARET MEAD, THE AMERICAN
anthropologist and proto-environmentalist, issued a call to action: "We have
to learn to cherish this earth and cherish it as something that's fragile, that's
. only one, it's all we have. We have to use our scientific knowledge to correct
the dangers thathave come from sc'ience and technology." Back in those early
days-long before we began driving hybrid cars and politicians started using
words.like "sustainability' and "carbon footprint" to win elections __V1eadand
her Earth Day comrades were on the fringe. Would she be surprisedto see how
mainstream the green movement is today? Probably not.Afterall, she oncesaid,
"Never doubt that a small group of thoughtful, committed citizens can 'change
the world." ANit takes is a great idea. Here we've gathered 10 of those, alongwith the stories of thq thoughtful citizens who are trying to make them a reality.
ILLUSTRATIONS By'GRAFILU
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•AKE A GREENER BURGER
WHO KNEW HAMBURGERS COULD WRECI<' THE PLANET?
That's what environmentalists say is happening, as ranch-
ers raze the Brazilian rainforest and their methane-emitting
cows foul the atmosphere with greenhouse gases. No one has
been more a target ofenvironmentalists' ire than Blairo Maggi.
Though known as a soybean tycoon, Maggi became BigBeef's
best friend as a two-time governor of Mato Grosso, the frontier
state that boasts Brazil's largest herds and has helped make that
nation the world's No.r.beef exporter. But this "developmental-
ista," who in 2005 won Greenpeace's Golden Chainsaw award'
for the havoc he had wreaked on the Amazon, has become Bra-
zil's latest tree-hugger. The talk in Maggi's corral is all about
"sustainable development," "carbon credits," "avoided defores-
tation" -and green beef. After signing on to a 2006 moratorium
on selling soybeans harvested.fromrecently deforested lands,
Maggi last year extended the ban to Amazon beef cattle. He has
urged ranchers and Brazil's giant meatpackers to clean up their
act, and: is even using satellites to monitor illegal clear-cutting
and burning of forests. Why Maggi's change of heart? It's smart
business. "The entire world has come to the conclusion that for-
ests should be worth more standing than cut down;" he often
says. "Farmers should get paid for that." -MAC MARGOLIS .
I NEWSWE:EK,COM [325
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•NVEST
IN THEIMPROBABLE
THEY SAY GREAT RISK BRINGS GREAT REWARD. JUST ASK
Vinod Khosla, the Sun Microsystems cofounder who
became Silicon Valley's most vaunted venture capitalist.
These days, Khosla-is betting on green-tech startups, with
a $1 billion venture-capital fund called Khosla Ventures. "I
'like technologies that have a 90 percent chance of failure,"
he says. "Because a 10 percent chance of making 100 times
your money is better than an 80 percent chance of doubling
your money." He belie es huge breakthroughs begin with
highly improbable ideas-v=blaek swan technologies," he
calls them (a reference to assim Nicholas Taleb's theory
about the randomness and unpredictability of big events).
Khosla's flock includes in estments in battery-technology
startups like Recapping and Pellion, which he describes as
"some really long-shot things on electricity storage, some of
which are really not even batteries." He has also invested in a
company called Solum that's de eloping a measuring tool toenable farmers to use less fertilizer, thus reducing harmful
nitrogen runoff. "These are wa out there, flaky ideas" that
could take 10 to 15years to bear fruit. Luckily, he can afford
to be patient. -DANIEL LYONS
•ET OUTOF THE GULF
BEFORE THIS YEAR'S MASSIvE QIL SPILL, THE U.S. WAS GET-
ting 8 percent ofits oil from the Gulf of Mexico- a number that
translates to 1.6 million barrels each day. That statistic alone
helped oil executives persuade President Obama last week to
reopen the area. Demand, theysaid, is simply too high to keep
the rigs dry. But is it really? Jackie Savitz; a political-policy
26 m OCTOBER 25, 2010
analyst with the ocean-advocacy group Oceana, sees a fairly
simple way to get out of the gulf completely. For starters,
electrify 10 percent of America's cars by 2020 (we're already
at about 1percent). Switch oil-based power plants to clean
electric ones (there are only 105 of them). Update one quarter
of oil-heated homes to electric power (also doable; the num-
ber hasbeen decreasing). And phase in all available non-
feedstock biofuels (much of which are going unused). Total
barrels saved? Yep, 1.6million. The Alliance for Clean Energy
gave Oceana a grant this summer to implement the agenda,
which could be passed in pieces. And during a debate last
month, a senior Interior Department official admitted the
idea wasn't so farfetched. "The oil companies depend on all
of this stuff sounding really difficult," says Savitz. "But really,
it's not that hard." - DANIEL STONE
•CATCH
A WAVE
MORE THAN 70 PERCENT OF THE EARTH'S SURFACE IS COV-
ered by water, most of it in oceans that seethe and crash
around with pent-up energy. What if you could harness that
power? As many green venturers have discovered over the
years, catching a wave is no easy feat because the oceans are
so harsh on equipment and the energy produced is expensive. ,
Now, thanks (ironically) to Big 'Petroleum, the harvest of the
seas is at hand. The quest for oil and gas buried deep beneaththe ocean and the polar icecaps has yielded a new generation
ofmaterials and equipment that can withstand salt, gale-force
winds, giant waves, crushing water pressure, and thermal
shock. In March, 10 energy firms got the green light to set up
wave and tidal farms off the coast of Scotland, with plans to
generate enough electricity to power 750,000 homes by 201$.
Pilot plants have also been set up in Portugal, Indonesia,
Taiwan, and the Northeastern Seaboard of the United States
(insiders speak of the "Gulf of Maine"). The Marine Board of
the European Science Foundation recently concluded that
Europe could draw half its power from the seas by 2050. All
that's needed is for enough public and private investors to
take the plunge. -M.M.
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HUG
A NUKE
ONE OF 'l1HE BIG PROBLEMS WITH NUCLEAR- ENERGY IS
that" to generate power, you first need to enrich uranium.
Enrichment is inefficient-some 92 percent of the original
uranium gets cast aside as "depleted uranium." Worse, once
you.start enriching uranium to make fuel, you can enrich itfurther to make material for bombs. But what if you could
make nuclear power that didn't need enriched uranium?
What about a reactor that runs on depleted uranium? That's
the idea behind TerraPower. "We've shown it can work,
through theoretical calculations and detailed computer sim-
ulations," says Nathan Myhrvold, CEO of Intellectual Ven-
tures, the Bellevue, Wash., "invention lab" where the ideas
behind TerraPower were hatched. Myhrvold was once chief
technology officer at Microsoft, and his longtime friend,
Microsoft cofounder Bill Gates, is among the investors in
TerraPower. The company consults with a network of 12.0
nuclear-power experts, and the plan is to get a test reactorrunning by 2020. Likely countries include China, India, Rus-
sia, Japan, and France. "We've had talks with all of them in
thelast few months," Myhrvold says. -D.L.
TURN SMOKE
7 IN TO ROCK S• 1 . : \
WE TALK A LOT ABOUT REDUCING CARBON DIOXIDE, TAXING
it, eliminating it. But there's a case to be made for keeping
CO2 around. Los Gatos, Calif.- based Calera has developed a
pro-cess that takes CO2
from a power-plant smokestack and
turns it into cement. The technology would reduce CO2 intwo ways-first by slashing power-plant emissions and then
by displacing the existing cement-making industry, which is
one of the biggest generators' of carbon dioxide. "That's the
cool part of this," says Randy Seeker, Calera's chief technol-
ogy officer. "We're getting a twofer." Calera's approach was
dreamed up by Brent Constantz, a Stanford science profes-
sor who studied how coral reefs are formed in nature (car-
bon dioxide mixes with calcium to form calcium carbonate)
and then found a way to mimic the process. Calera has a
pilot plant running in California, and another set to start
up in Wyoming next year; the goal, is 'to have commercial
plants running by 2013 or 2014. There are some big obsta-
cles, though: if the United States doesn't impose legislation
that pushes power plants to reduce carbon emissions, those
plants probably won't pay someone like Calera to keep theirsmokestacks clean. -D.L.
~
•RINK YOUR
GARBAGE
TO SOME, THE SMELL OF A LANDFILL IS SWEET. THAT'S
because the stuff we throwaway could help us save the
planet and turn a profit. Plastic is made of petroleum, so
finding ways to reuse it could make us less dependent on
oil. And the household electronics we discard are loaded
with elements like nickel, copper, and lithium, which one
day could be in short supply. Why not mine our own trash?
That's the plan in Belgium, where a British company,
Advanced Plasma Power, plans to start digging up land-
fill, in part to get at buried metals as well as methane gas
that could generate electricity. Axion international of New
Providence, N.J., has found a way fo craft pilings, beams,
and other building components out of recycled plastic.
How strong is it? At Fort Bragg, the UiS, Army has erected a
bridge for tanks out of railroad ties fashioned from Axion's
beams. Singapore last year-installed a system that turns
sewage into drinking water. But what if this process could
also make money? Mark Shannon .at the University of Illi-
nois is working on a device that can take human sewage and
turn it into fresh water, methane, and minerals that could be
sold on the open market. -MICHAEL KANELLOS
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[fCRO'BES LIVE IN FERMENTATION VATS, FEED ON FILTH,
and at the end of the week you can kill them off. In short, they
are the perfect employees. A raft of startups and established
multinationals have woken up to the power of metabolism-
the interaction that occurs when a living organism ingests
food and chemically converts it into something else. It's not
a new idea. For centuries, humanity has exploited yeast to
produce beer and cheese. But now companies are looking to
microbes to power your car. BioCee of Minneapolis is work-
ing on microbes that can soak up sunlight and carbon dioxide
and convert it into asubstitute forpetroleum. Stanford Uni-
versity has discovered a bug that uses sunlight to split water
into hydrogen and oxygen (which could make the hydrogen
economy touted in the 1990S a reality). Amyris of Emeryville,
Calif., has devised genetically modified yeast that produces
something close to gasoline. "We can engineer microbes to
do our bidding," says Steve Jurvetson, a venture capitalist atDraper, Fisher, jurvetson, which has invested in superbug
startups Genomatica and Synthetic Genomics. The down-
side? Superbugs are hard to create and hard to produce in
large volume, and don't survive well. - M.K.
SHOUT ITOUT LOUD
NEVER UNDERESTIMATE THE POWER OF PROTEST. MA JUN,
a former investigative journalist for the South China Morning
Post, heads the Institute of Pub lie ami Environmental Affairs,
a tinyNGO run out ofa Beijing apartment that has taken on
some of the world's leading corporations. His NGO collects
government data about local suppliers that are violating envi-
28 r n OCTOBER 25, 2010
ronmental standards, and examines which Western multina-
tionals they're connected with. He then works with foreignnonprofits to pressure the likes of Nike, Levi Strauss, Apple,
and GE to clean up their act. In China, speaking up about
sensitive issues can sometimes be more hazardous to your
health than pollution. But Ma has succeeded. His group was
a catalyst behind Wal-Mart's well-publicized demand that its
top 1,000 Chinese suppliers improve their green footprint.
As he points out, the Chinese version oftheEPA has just 230
full-time staff looking after a country of 1.3billion, which is
whyjt's important to continue engaging the West around Chi-
nese environmental issues. "Americans should remember
that we are your backyard-our pol1uted waterways are your
mercury-laced toys. It's all c~9Pected." - RANA iFOROOHAR
LIGHTEN UP
THE BEST GREEN IDEAS ARE ONES THAT SAVE YOU MONEY,
right away, without any kind of government subsidy or legisla-
tion. And there's no better example of that than LED lighting.
Sure, LED bulbs cost more than traditional ones. But they also
save tons of money on electricity by sipping less juice to make
the same amount of light. "If you spend $100,000 to retrofit
a parking garage with LED lights, I, can save you $100,000 a
year ori electricity," says Charles Szoradi, CEO gfLED SavingsSolutions, in Devon, Pa. What's more, those LED bulbs will
last up to 10 years, so that $100,000 initial investment could
deliver $1million in gross savings. No wonder big companies
are jumping on the LED bandwagon, among them Wal-Mart,
which announced plans to put LED lights in 650 stores. That
deal and others like it are fueling a boom for Durham, N.C.-
based Cree Inc., which makes ,the- semiconductors used in
LED lights, as well as some LED bulbs of its own. After sev-
eral years of modest growth, Cree's, revenues have exploded.
Sales in the 2010 fiscal year, which ended in june; grew 53 per-
,cent to $867 million, and analysts expect sales to hit $1.2 billion
in the current year. With numbers like that, no one can deny
that environmentalism is a bright idea. - D.L.
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G R ~ ~ N
R A N K I N G S I F O R A N I N T E R A C T I V E V E R S I O N O F T H E
N E W S W E E K G R E E N R A N K I N G S ,
I N C L U D I N G D A T A O N A L L 5 0 0 U .S . C O M P A N IE S
A N D 1 0 0 G L O B A L C O M P A N I E S , A S W E L L
A S A ~ ~ ~ : ~ ~ ~ ~ ~ ~ ~ ~ ~ . ~ ~ 0 ~ ~ E O E L K ~ g ~ , ~ 0 T O
T H E 1 0 0 G R E E N E S TC O M P A N E S N A M E R C ABY KATHLEEN DEVENY
WHEN JEFF SWARTZ, CEO OF TI {BER-
land, was buying computers for his
footwear-and-apparel company a few
years ago, he had questions for a sales-
man from Dell. "I told him that part of
how we decide is based on environmen-
tal stewardship," recalls Swartz. "The
salesman said, 'Our founder is very
serious about running our business
that way. I'll ask him to call you.' Right,
thought Swartz. M ic hael D ell is go ing to
c all m e ..But that's exactly what happened.
Dell called Swartz. and explained his
theories of environmentalism and fru-
gality: that minimizing waste is good
for the bottom line. "I was impressed,"
Swartz says. So much so that .Timber-
land gave its business to Dell,
It's an example of the kind ofcommit-
ment that helped Dell earn the NO.1spot
in NEWSWEEK'S 2010 Green Rankings.
Dell got high marks for its strong envi-
ronmental policies, including free recy-
cling of products worldwide and a ban
on the' export of e-waste to developing ,
countries. But while feel-good policies
may win the trust of potential custom-
. ers, offering more efficient products
~closes the sale. And Dell has figured out
how to do both, designing desktops and
laptops that consume 25 percent less
energy than systems produced in 2008.
Dell figures these efforts, along with
MSCIESG Research
A L EA D I N G S O U R C E O F E N V IR O NM E N T A L ,
S O C IA L, A N D G O VE R N A N C E R A T IN G S .
others, have saved its customers more
than $5 billion in energy costs over the
past few years.
Tech 'companies dominated this
year's Green Rankings-in part because
they make low-impact products, like
software, that inevitably have a smaller
environmental footprint than, say, a util-
ity (though PG&E did hit No. 20 on the
list, thanks to a commitment to renew-
able energy). But bottom-line consider-
ations are a big part of what's drivingtech companies in the green direction.
Intheir quest to create products that are
cheaper to manufacture and operate,
tech firms are devising solutions that
have the added benefit of saving energy
or reducing waste. Hewlett-Packard,
No.2, says its current IT systems use 66
percent less energy than those designed
in 2005. "A lot of the innovation in this
space is coming out of business pres-
. sure," says Michael Mendenhall, HP's
chief marketing officer.
For many tech companies, cooling
their data centers requires enormous
amounts of energy. Yahoo, NO.9, has
been a leader in designing environmen-
tally sustainable data centers, including
,a new facility in New York that consumes
40 percent less electricity and 94 percent
less water-enough to provide drinking
water for 200,000 people for a year-
than conventional data centers.
NEWSWEEK'S goal in these rank-
ings is to quantify companies' actual
environmental footprint, policies, and
reputation. To accomplish this; we
joined forces with top environmen-
tal researchers: MSCI ESG Research,
which tracks environmental, social, and
governance data; Trucost, which spe-
cializes in quantitative measurements of
environmental performance; and Cor-
porateRegister.com, the world's largest
directory of sustainability and environ-mental reports. Our editorial partner,
ASAP Media, founded by Peter Bern-
stein and Annalyn Swan, coordinated
the project.
We started with the 500 largest pub-
licly traded U.S. companies, as meas-
ured by revenue, market capitalization,
and number of employees. Then we
gave each one of them a Green Score,
.which is calculated using the following
three component scores. The Environ-
mental Impact Score, compiled by Tru-
cost, is based on more than 700 metrics,
including greenhouse-gas emissions,
water use, and solid-waste disposal.
The Green Policies Score is based on
data collected by MSCI ESG Research,
and reflects an, analytical assessment
of a company's environmental policies
and initiatives. The Reputation Score
is based on' a survey of academics,
environmental officers, and CEOs. To
'CorporateRegister.comT H E W O R L D 'S L AR G E S T O N L IN E D IR E C TO R Y O F
C O M P A N Y - I S S U E D E N V IR O N M EN T A L R E P O R T S .S P E C IA L I S T S I N C R EA T I N G M A G A Z I N E ,
B O O K , A N D O N LI N E C O N T E N T ,
M E A S U RE S Q U A N TI T A T IV E E N V I R O N M E N T A L
P E R FO R M A N CE ( TR U C O ST .C O M ) .
ASAP
- ,NEWSWEEK.COM m 29
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calculate a company's overall ranking,
the three component score were stan-
dardized, combined u ing a weighted
average (45 percent for the Environ-
mental Impact core. 45 percent for the
Green Policie core, and 10percent for
the Reputation urvey), and mapped to
a roo-point cale.
e made two important changes to
the methodology this year: we included
a measure of how much data each com-
pany eli closes in its Environmental
Impact core, and for financial-services
firms ~'e considered the environmental
footprint of companies in their invest-
ment and lending portfolios. Because of
the e changes, the scores are not com-
parable to the 2009 rankings.
The methodology was created in
consultation with an advisory panel,whose members served independently of
their respective organizations. Panelists
30 m OCTOBER 25, 2010
include John Elkington, executive
chairman of Volans and cofounder of
Sustain.Ability; Daniel Esty; Hillhouse
professor of, environmental law and
'policy at"Yale University'; Majorie Kelly,
senior associate at the Tellus Institute
and cofounder of Business Ethics; Tom
Murray, a managing' director in the
Environmental Defense Fund's Cor-
porate Partnerships Program; Wood
Turner, executive director of Climate
Counts; David Vidal, research director
of Global Corporate Citizenship at the
Conference Board; and Deborah Wince-
Smith, president anti CEO of the Coun-
cil on Competitiveness.
The companies listed here represent
the 100best performers ranked on their
overall Green Score. For the complete
U.S. 500 ranking and a comprehen-sive explanation of methodology, go to
greenrankings.newsweek.com. 0
Wor ldwide
fo otp rin t, b as ed
on m ore than
700 rnetrics,
I N D U S T R Y C O L O R C O D E
C on su m er P ro du cts , C ars
• • • • 1 1 F inanc ia l Se rv ic e s
lllilllllll Fo od a nd Bev er age
1 1 1 1 1 1 1 1 1 1 1General lndustrials
•••• H ealth Care
1 1 1 . 1 1 1 1 1 1 1 I nd us tr ia l Go od s
•••• O ilandGas
. 1 1 1 1 1 1 Pharmaceut ica ls
•••• R eta il
• • 1 1 1 1 1 Technology
14••1 1 1 1 Transport.Aerospace
A comp r ehens iv e
a sse ssm en t o f
env i ronmenta l
init iat ives.
O v er al l g re e n
p erfo rm a nc e, b as ed
on t he p re v io u s
t hr ee s co re s .
Based on a po ll o f
sustainabil i tyof f icers,
a c a d e m i c s , a n ,e jC E O s .
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98.86
;ogl:es~;iveclimate-change poli-
surpassed itsgoal withfor reducing waste,
Titusville, N . J . , facility.
NEWSWEEK,COM m 31
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T H E L S Tu . s . RANKINGS 11-100
R A N K ' C O M P A N YG R E E N
S C O R E R A N K C O M P A N Y
G R E E N 'S C O R E
FOR THE COMPLETE RANKINGS OF ALL 500 U.S. COMPANIES, GOTO GREENRANKINGS.NEWSWEEK.COM.
FOR MORE ANALYSIS OF EACH COMPANY AND INDUSTRY, BUY A 2010-2011 GREEN RAN KINGS BUSINESS REPORT AT WW
32 m OCTOBER 25, .2010
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R A N K C O M P A N YG R E E N
S C O R E R A N K C O M P A N Y
, ; - : ":.'
_ _ , ~ ;r.~,J, '
G R E E N
. S C O R E
EWSWEEK.COM/GREENREPORT. USE COUPON CODE GR2010NW TO RECEIVE A 10 PERCENT DISCOUNT.
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G L O B A LTHE 25 GREENESTCOMPANIES IN THE WORLDTHI YEAR;EW EK_~;nIT RESEARCH PARTNERS HAVE
expanded the Gre n Rankings to analyze the 100 biggest
companie w. rI "ide. IB~[, with its commitment to reduc-
ina greenhouse-ga emissions, earned the No.1 spot. This
rankine 0 p blic companies in developed and emerging mar-
ket u es the same rigorous methodology as the u.s. rank-ina. But beca e companies are scored relative to each other,
and becaus the composition of this list is different from the
.companies that appear on both lists score differently.
G R E E N
S C O R E
34 m OCT-OBER 25, 2010
FOR THE COMPLETE RAN KINGS OF ALL 100 GLOBAL COMPANIES, GOTO GREENRANKINGS.NEWSWEEK.COM
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T R U E G R E E NG O O D G U I D E 'S M IS S I O N I S T O H E L P S H O P P E R S P I C K T H E G R E E N E S T
S H A M P O O O R T O O T H P A S T E , B U T I S T H A T A B U S I N E S S ?
BY IAN YARETT
ONE SUNNY MORNING IN 2004, DARA O'ROURKE WAS PUTTING
sunscreen on his z-year-old daughter's face when he had a dis-
turbing thought. As a professor of environmental policy at the
University of California, Berkeley, he'd spent years studying the
global supply chains for products like electronics and shoes. But
he had no idea exactly what he was smearing on his daughter.
The thought spurred O'Rourke=who'd made headlines in
1997 for exposing problems with Nike's labor practices-to
action. Back in his lab at Berkeley, he found that the sunscreen-
a top-selling brand-included a hormone-disrupting chemical,
a suspected carcinogen activated by sunlight, and several skin
irritants. "I'm a total nerd+I not only read ingredient lists but
study factories in China, Vietnam, EI Salvador," he says. "Yet I
still didn't know what I was bringing into my house every day."
O'Rourke enlisted the help of some of his students and
launched Good Guide, a Web-based system that rates con-sumer products-personal care, food, household cleaners,
and toys, so far-son their health, environmental, and social
impacts. O'Rourke's idea is to take academic-quality research
and make it accessible to average people, empowering them to
find healthier, greener products. Today the company provides
ratings for more than 75,000 items. Last month 300,000 people
visited its site, and its free iPhone app-which lets consumers
scan bar codes to pull up product ratings-has been down-
loaded half a million times.
TOOTHPASTEBEST BRANDS, ACCORDING TO GOODGUIDE; A PERFECT SCORE IS 10
LA UN DR Y D ETE RG EN TBEST BRANDS, ACCORDING TO GOODGUJDE; A PERFECT SCORE IS 10
Most U.S.consumers say they want environmentally respon-
sible products-soc percent by one recent study. Yet far feweractually buy them, and higher cost isn't the only obstacle. As
the number of "green" products on store shelves explodes-up
72 percent over the last year at a representative group of big-box
retailers, according to the environmental marketing firm
TerraChoice-consumers are increasingly wary of greenwash-
ing. "There's massive confusion about what it means to be
green," says Chuck Maniscalco, the CEO ofSeventh Generation.
GoodGuide's initial challenge was a scientific one: to develop
a useful ratings system based on credible science. The com-
pany's product information-and the software it built to
process it-is highly respected by industry experts. The Good-
Guide system draws data from 300 sources-including firms
that do socially responsible investing research, scientific.insti-
tutions like the EPA, academic studies" company Web sites,
and others-to score produets on up to 1,500 individual crite-
ria. GoodGuide's scientists determine the relative importance
of each of these metrics for evaluating each product category,
and those weightings are used to boil down the raw data into
simple ratings on a lO-point scale. "It's the current state of the
art," says Daniel Goleman, author of E co logi cal In te ll ige nce , a
book about the hidden impacts ofwhat we buy. .
Now GoodGuide's challenge is to turn its science into a
business. O'Rourke is committed to keeping the service free
to consumers, but that means the company, which is sup-
ported by $9.2 million invested by venture capitalists, must
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SPECIAL ADVERTISING FEATURE
find other ways of generating revenue,
GoodGuide has discovered that retailers
and manufacturers are interested in its
data for market and product-develop-
ment research-and about a dozen of
them are already paying to use it.
Experts say that GoodGuide'sratings
are the best available=for now. Wal-
Mart announced in July 2009, that it
plans to assess the ecological footprintof its supply chain and produce a prod-
uct-rating system aimed at consumers.
Green products and transparency are
"not only good for the environment and
society buf a. good business strategy,"
says Matt Kistler, a senior vice president
at Wal-Mart. "The customer of tomor-
row will, seek more information about
.the products they buy, and providing
more information will make manufac-
turers more competitive in the future."
Yet Kistler says Wal-Mart's consumer
ratings are at least two years off.
Meanwhile, GoodGuide has made
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SPECIAL ADVERTISING FEATURE
a splash disproportionate to its small
size. Major manufacturers, including ,
Clorox, have .reaehed out-to G(i)odGuide
to either providedataor t o get a better"
idea of what information consumers
want to know about their company and
products. "We were shocked by how
quickly big companies have realized
the relevance of GoodGuide,'" saysWil-
Ham Rosenzweig, managing director of
Physic Ventures, a GoodOuide investor ..
GoodGuide recently brought In a new
CEO with experience growing Web busi- '
nesses to help guide the company through
its next phase of development. It is add-
ing asocial-networking component that
,will allow users to consider both the hard
, data and opinions oftrusted friends when
making a purchasing decision. And the
company claims thousands of people
have switched.brands as a result of the-~ite and app, Itseems that the company.is
doing goed-sbut.it.remains to be seen if
it can do well. ,D,
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SINCE WINNING THE REPUBLICAN SENATE PRIMARY IN,
Delaware last month, Christine O'Donnell has noLh~dl ! I ; $ + " . . ' " . " . . · ·• . ; , ' 1 , . . . . . . . ' I I ' . '
trouble gett~ng'hnticed.Wnen tn~Y,rreaarty;iGoi1:.almit-
ted to "dabbl[ing]' into witchcraft" as a youngster, the
press went wild. When she revealed that she was "not a
witch" after all, the response was rabid. O'Donnell has
fudged her academic credentials, defaulted on her mort-
gage, sued a former employer, . a . l 1 d campaigned .a'; '··st, . .
masturbation, and her eff6rts h~~¢been rewarde 'th
round-the-clock coverage. Yet few observers seem.to
have given her views on the United States Constitu-
tion the same level of consideration, Which is too bad,
Donnell's Tea party take on our fo,p,nd,-
BY ANDREW ROMANO
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the candidate further back than Beck. The last time
poke to 2,000
a the annual Values
Voter ummi in ashington, D.C. She
wore a b . and pearls, and swept
on stage 10 e sound ofJourney's "Don'tStop Bell . .•• fost of the speech was
unremarkable: a laundry list of conser-
vative pta· des. But near the end she
zeered into tranger-and more reveal-
ing=territory O'Donnell once told voters
that er 0.1" qualification for the Sen-
ate' an eight-day course, she took at a
conservative think tank in 2002.,Now she
asrevisiting its subject: the Constitution.
he Founders' masterpiece, O'Don-
nell said, isn't just a legal document; it's a
"covenant" based on "divine principles."For decades, she continued, the agents of'
"anti-Americanism" who dominate "the
D.C. cocktail crowd" have disrespected
the hallowed document. But now, finally,
in the "darker days" of the Obama admin-
istration, "the Constitution is making a
comeback." Like the "chosen people of
Israel," who "cycle[d] through periods
of blessing and suffering," the Tea Party
has rediscovered America's version of
"the Hebrew Scriptures" and led the
country into "a season of constitutional
repentance." Going forward, O'Donnell
P O L IT I C A L O P P O N E N T S ,
B E C K S A Y S , A I M ' T O
S E P A R A T E U S F R O M
O U R C O N S T I T U T I O N
A N D G O D . '
declared, Republicans must champion
the ''American values" enshrined in our
sacred text. "There are more of us than
there are of them," she concluded.
By now, O'Donnell's rhetoric should
sound familiar. In part that's because her
fellow Tea Party patriots-Glenn Beck, '
Sarah Palin, the guy at the rally in the tri-
, corn hat-also refer to the Constitution
as-if it were a holy instruction manual
that was lost, but now, thanks to them,is found. And yet the reverberations go
40 m OCTOBER 25, 2010
America elected a new Democratic presi-
dent, in 1992,the Republican Party's then-
dominant insurgent group used identical
language to describe the altogether dif-
ferent document that defined their causeand divided them from the heretics in
charge: the Bible. The echoes of the reli-
gious right in O'Donnell's speech-the
Christian framework, the resurrection
narrative, the "us vs. them" motif, the
fixation on "values" -aren't coincidental.
From a legal perspective, there's a case
to be made that O'Donnell's argument is
inaccurate. The Constitution is a relent-
lessly secular document that never once
mentions God or Jesus. And nothing in
recent jurisprudence suggests that the pastfew decades of governing have been any
less constitutional than the decades that
preceded them. But the Tea Party's lan-
guage isn't legal, and neither is its logic.It's
moral: right vs. wrong. What O'Donnell &
Co.are really talking about is culture war.
When Barack Obama took office,
experts rushed to declare an end to
the old battles over race, religion, and
reproductive rights-whether because
of Obama's alleged healing powers, or
the Great Recession, or both. But these
analyses ignored an important reality: at
heart, the culture wars were really never
about anything as specific as abortion or
gay marriage. Instead, as James Davison
Hunter wrote in C u lt ur e W a r s, the book
that popularized the term, the conflicts
of the 1990S represented something big-
ger: "a struggle over ... who we have
been ... who we are now, and ... who we,
as a nation, will aspire" to be. Such con:
flicts, Hunter explained, pit "orthodox"
Americans, who like the way things
were, against their more "progressive"
peers, who are comfortable with the way
things are becoming. '
For the forces of orthodoxy, the elec-
tion of a black, urban, liberal Democrat
with a Muslim name wasn't a panacea
-a t all; it was a provocation. So when
the recession hit, and new economic
anxieties displaced the lingering social
concerns of the Clinton era, politi-
cal fundamentalists sought refuge in amore relevant scripture-one that could
still be made to accommodate the sim-
pler, surer past they longed for but hap-
pened to dwell on taxes and government
instead of sinning and being saved.
The Constitution was waiting. Today,
Tea Party activists gather to recite the
entire document to each other. They
demand that a wayward America return ,
to its Constitutional roots. They even travel
to Colonial Williamsburg and ask the
actor playing George Washington how to
topple a tyrannical government. In short,
they take their Constitution worship
very, very seriously. The question now is
whether the rest ofus should as well.
Contemporary Constitution wor-
shipers claim that they've distilled their
entire political platform-lower taxes,
less regulation, minimal federal govern-
ment-directly from the original text of
the founding document. Any overlap
with mainstream conservatism is inci-
dental, they say; they're simply following
the Framers' precise instructions. If this
were true, it would be quite the politi-cal coup: oppose us, the Tea Party could
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claim, and you're opposing James Madi-son. But the reality is that Tea Partiers
engage with the Constitution in such a
selective manner, and for such nakedly
political purposes, that they're clearly
relying on it more as an instrument of
self-affirmation and political division
than a source of policy inspiration.
I N I I E G A L circles,co~sti~tional~-, L damentalism IS nothing
new. For decades, scholars and judges
have debated how the founding docu-ment should factor into contemporary
legal proceedings. Some experts believe
in a so-called living Constitution-a set
of principles that, while admirable and
enduring, must be interpreted in light
of present-day social developments in
order to be properly upheld. Others
adhere to originalism, which is the idea
that the ratifiers' original meaning is
fixed, knowable, and clearly articulated
in the text of the Constitution itself.
While conservatives generally preferthe second approach, many disagree
o er how it should be implemented-including the Supreme Court's most
committed originalists, Antonin Scalia
and Clarence Thomas. Thomas sym-
pathizes with a radical version of origi-
nalism known as the Constitution in
Exile. Inhis view, the Supreme Court of
the 1930S unwisely discarded the 19th-
century's strict judicial limits on Federal
power, and the only way to resurrect the
"original" Constitution-and regain our
unalienable rights-is by rolling back the
welfare state, repealing regulations, andperhaps even putting an end to progres-
sive taxation. In contrast, Scalia is will-
ing to respect precedent-even though it
sometimes departs from his understand-
ing of the Constitution's original mean-
ing. His caution reflects a simple reality:
that upending post-1937 case law and
reversing settled principles would prove
extremely disruptive, both in the courts
and society at large. As Cass Sunstein, a
centrist legal scholar at the University of
Chicago who now serves inthe Obamaadministration, has explained, "many
decisions ofthe Federal Communications
Commission, the EnvironmentafProtec-
tion Agency, the Occupational Safety and
Health Administration, and possibly the
National Labor Relations Board would
be [ruled] unconstitutional" if Thomasgot his way. Social Security could be
eliminated. Same goes for the Securi-
ties and Exchange Commission and the
Federal Reserve. Individual states might
be allowed to establish official religions.
Even minimum-wage and maximum-
hour laws would be jeopardized.
Tea Partiers tend to sound more like
Thomas than Scalia. Every weekday on
Fox News, Glenn Beck-"the most highly
regarded individual among Tea Party
supporters," according to a recent poll-
takes to his schoolroom chalkboard to
rail against progressives like Wood-
rowWilson and Franklin D. Roosevelt.
"They knew they had to separate us from
our history," he says, "to be able to sepa-
rate us from our Constitution and God."
In Beck's view, progressives forsook the
faithful Christian Founders and forced
the country to adopt a slew of unconsti-
tutional measures that triggered our long
decline into Obama-era totalitarianism:the Federal Reserve System, Social Secu-
T H E C O U N T R Y H A S
E N T E R E D I N T O
' A S E A S O N O F
C O N S T I T U T I O N A L
R E P E N T A N C E /S A Y S O ' D O N N E L L .
rity, the graduated federal income tax.
True patriots, according to Beck, favor
a pre-progressive vision of the United
States. When Nevada Senate nominee
Sharron Angle says we need to "phase
out" Social Security and Medicare; when
Alaska Senate nominee Joe Miller asserts
that unemployment benefits are "uncon-
stitutional"; when West Virginia Senatenominee John Raese declares that the
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minimum wage should "absolutely" be
abolished; when Kentucky Senate nomi-
nee Rand Paul questions the legality ofthe
Civil Rights Act of 1964; when Minne-
sota Rep. Michele Bachmann claims that
Obama's new health-insurance law vio-lates the Constitution; and when various
Tea party candidates say they want to
repeal the amendments that triggered the
federal income tax and the direct election
of senators-this is the vision they're pro-
moting. At times, the Tea Party can seem
like a popularized, politicized offshoot of
the Constitution in Exile movement.
Over the years critics have lodged
dozens of objections to originalism-the
disagreements among the Founders; the
preservation ofslavery in the final product;
the inclusion ofan amendment process-
and they apply to the Tea party's inter-
pretation of the Constitution, too. But at
least originalism is a rational, consistent
philosophy. The real problem with the Tea
party's brand ofConstitution worship isn't
that it's too dogmatic. It's that it isn't dog·
matic enough. In recent months, TeaParty
candidates have behaved inways that belie
their public commitment to combating
progressivism. They've backed measures
that blatantly contradict their originalist
mission. And they've frequently misun-
derstood or misrepresented the Constitu-
tion itself. In May, for example, Paul told
a Russian television station that America
"should stop" automatically granting citi-
zenship to the native-born children ofille-
gal immigrants. Turns out his suggestion
would be unconstitutional, at least accord-
ing to the iath Amendment (1868) and a
pair of subsequent Supreme Court deci-
sions. A few weeks later, Paul said he'd like
T H E C O N S T I T U T IO N
' A C K N O W L E O G [ E S I
T H A T O U R U N A L I E N A B L E
R IG H T S . . . C O M E F R O M
G O O , " P A t i N S A Y S .
42 m OCTOBER 25: 2010
to prevent federal contractors from lobby-
ing Congress-a likely violation of their
First Amendment right to redress. InJuly,
Alaska's Miller told ABC News that unem-
ployment benefits are not "constitutionally
authorized." Reports later revealed thathis wife claimed unemployment in 2002.
The list goes on. In last week's Dela-
ware Senate debate, O'Donnell was asked
to name a recent Supreme Court case she
disagreed with. "Oh, gosh," she stam-
mered, unable to cite a single piece of evi-
dence to support her Constitution in
Exile talking points. "I know that there
are a lot, but, uh, I'll put it up on my Web
site, I promise you." Angle has said that
"government isn't what our Founding
Fathers put into the Constitution" -even
though establishing a federal government
with the "Power To lay and collect Taxes"
to "provide for the common Defence and
general Welfare" is one of the main rea-
sons the Founders created a Constitution
to replace the weak, decentralized Arti-
cles of Confederation. In 2008 Palin-
favorite Founder: "all of them" =told
Katie Couric that the Constitution does,
in fact, guarantee "an inherent right to
privacy," a la Ro e v. W ade, but added that
"individual states ... can handle an issue
like that." Unfortunately, Palin's theory
would only be possible in a world without
the Fourteenth Amendment (again, 1868),
which gaveWashington sole responsibil-
ity for safeguarding all constitutional
rights. And most Tea Partiers claim that
the ioth Amendment, which says "the
powers not delegated" to the federal gov-
ernment are "reserved to the states," is
proof that the Framers would've balked
at today's bureaucracy. What they don'tmention is that James Madison refused a
motion to add the word "expressly" before
"delegated" because "there must neces-
sarily be admitted powers by implication."
Then there are the proposed amendments.
In the current Congress, conservatives like
Michele Bachmann have suggested more
than 40 additions to the Constitution: a
flag-desecration amendment; a balanced-
budget amendment; a "parental rights"
amendment; a supermajority-to-raise-
taxes amendment; anti-abortion amend-ment; an anti-gay-marriage amendment;
and so on. None of these revisions has
anything to do with the document's orig-
inal meaning.
The truth is that for all their talk of
purity, politicians like Palin, Angle, and
Miller don't seem to be particularly con-
cerned with matching their actual posi-J!tions to the Constitution they proress to
worship. For them, the sacred text serves
a higher purpose-and in the end; that
purpose isn't hard to pinpoint.
S I N C E T H E ;:~~~~~c,di~e~ic~~:
have, like the Tea Partiers, spoken of
the Constitution in religious terms. In
1792, Madison wrote that "common
reverence ... should . guarantee, with
a holy zeal, these political scriptures I
from every attempt to add to or dimin-
ish from them." George Washington's
Farewell Address included a plea that
the Constitution "be, sacredly main-
tained." In his Lyceum speech of 1838,
Abraham Lincoln cited the documents the source of "the political religion
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of the nation" and demanded that its
laws be "religiously observed." In 1968,
Supreme Court Justice Hugo Black
called the Constitution his "legal bible,"
and a few years later, during Richard
Nixon's impeachment hearings, Texas
Rep. Barbara Jordan testified that her
"faith in the Constitution is whole." But
the similarity between these figures and
the Tea Partiers ends at the level of Ian-
guage. For leaders like Lincoln and Jor-
dan, the Constitution is a symbol "that.suppl[ies] an overarching sense ofunity
even in a society otherwise riddled with
conflict," as sociologist Robin Williams
once wrote. It is an integrative force-
the cornerstone ofour civil religion.
The Tea Partiers belong to a different
tradition - a tradition of divisive funda-
mentalism. Like other fundamental-
ists, they seek refuge from the
complexity and confusion of modern
life in the comforting embrace of an
authoritarian scripture and the imag-ined past it supposedly represents.
Like other fundamentalists, they see in
their good book only what they want to
see: confirmation of their preexisting
beliefs. Like other fundamentalists,
they don't sweat the details, and they
ignore all ambiguities. And like other
fundamentalists, they make enemies or
evildoers of those who disagree with
their doctrine. In the 1930S,the Ameri-
can Liberty League opposed FDR's
New Deal by flogging its version of
the Constitution with what historian
Frederick Rudolph once described as"a worshipful intensity." In the 1960s,
the John Birch Society imagined a vast
communist conspiracy in similar terms.
In 1992 conservative activists formed
what came to be known as the Constitu-
tion Party-Sharron Angle was once a
member-in order to "restore American
jurisprudence to its Biblical foundations
and to limit the federal government to its
Constitutional boundaries." Today,
Angle asserts that "separation of church
and state is an unconstitutional doc-trine," and Palin claims that "the Con-
stitution ... essentially acknowledg[es]
that our unalienable rights ... come
from God." The point is always the
same: to suggest that the Constitution,
like the Bible, decrees. what's right and
wrong (rather than what's legal andillegal), and to insist that only they and
their ilk can access its truths. We are
moral, you are not; we represent Amer-
ica, you do' not. Theirs is the rallying
cry of culture war.
The Tea Partiers are right to revere
the Constitution. It's a remarkable, even
' G O V E R N M E N T I S N 'T
W H A T O U R F O U N D I N G
F A T H E R S P U T I N T O
T H E C O N S T I T U T I O N , '
A N G L E I N S I S T S .
.mir~cplous document. But there are'
many Constitutions: the Constitution of
1789,of 1864, of 1925,of 1936,of 1970,of
today. Where O'Donnell &Co.gowrong
is in insisting that their imagined, ideal-
ized document is the country's one true
Constitution, and that dissenters are
somehow un-American. By putting the
Constitution front and center, the Tea
Party has reignited a long-simmering
argument over who we are and who
wewant to be. That's great. But to truly
honor the Founders' spirit, they have to
make room for actual debate. As usual,
Thomas Jefferson put it best. In a let-
ter to a friend in 1816,he mocked "men[who] look at constitutions with sancti-
monious reverence, and-deem them like
the arc of the covenant, too sacred to be
touched"; "who ascribe to the men of
the preceding age a wisdom more than
human, and suppose what they did to
be beyond amendment." "Let us-follow
no such examples, nor weakly believe
that one generation is not as capable as
another of taking -care of itself, and of
ordering its own affairs," he concluded.
"Each generation is as independentas the one preceding, as that was of all
which had gone before." Amen. 0
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The neuroscientist and ra tiona lis t bas made h isna f!le attackin
AM HARRIS, A MEMBER
of the tribe known as "the
new atheists," wishes the
headline to this story
said something else.
How about "Sam Harris
Believes in Spirituality,"
he suggests over lunch. Or "Sam HarrisBelieves in ~God,'I'with scare quotes?
In any case" Sam Harris-sa.hero to the
growing numbers of Americans who
check the atheist box on opinion polls-
concedes he believes I in semeshing
certain people would call "God." In a
related thought, he raises the topic of his
next project: a spirituality guide tenta-
tively titled T h e Jll us io n o / th e S el f. Based
on Harris's own "spiritual journey,"Jt
will "[celebrate] the spiritual.aspect of
human existence [and explain] how wecan live moral and spirituah lives with-
out religion," according toa .statement
44'(3 OCTOBER 25, 2010
from his -publisher; Free Press. It's sur-
prising. One hardly expects Harris, a
hyperrational polemicist, to veer into
the realm of spiritual self-help.
Spirituality is not a new interest of
Harris's, however. A careful reader will
have noticed fhat though he's often been
lumped together with the rabble-rousersDaniel Dennett, Richard Dawkins, and
Christopher Hitchens (all ar~ advisers to
his nonprofit grump Project Reason), and
though he continues to insist that reli-
gious faith is possibly the most destruc-
tive force in the' world, he shuns the label
"atheist," Harris placesireasen at the
apex of human abilities and achievement,
but he concedes that there's much that
humans may never: empirically know-
like what happens after death. "Mys- '
tery," he wrote in the concluding chapterof Th e' E nd o f F aith , published in 2004,
"is ineradicable from our circumstance,
BY .LISA MILLER "7-,:-
because however much we know, it
seems like there will always be brute facts
that we cannotaccount for but which
we must rely on to explain everything
else." For Mispraise of the contemplative
experience in T be E nd o f F a ith , Harris has
received criticism from atheists.
!Harris is in town promoting T he Mor a !Landscape, his new book. Bven here, he
briefly explores the connections between
spiritual experience-especially an expe=
rience of selflessness-and human hap-
piness. "I see nothing irrational about
seeking the states of mind that lie at the
core of many rellgionsvCompassion,
awe, devotion and feelings of oneness are
surely among the most-valuable expe-
riences a person can .have," he writes.
Over Iuneh; he says 'with a smile how
much. he 100ks forward to working em
the next :project, which will allow him
te pull.back.rafte« six long years, 'and
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relig iou s faith . W h o knew he w as so sp iritu al?
focus on things that support human
flourishing. "Ecstasy,rapture, bliss, con-
centration, a sense of the sacred-I'm
comfortable with allofthat," says Harris
later. "I think all of that is indispensable
and I think it's frankly lost on much of
the atheist community."
The answer to the question "Do you
believe in God?" comes down to this: It
depends on what you mean by "God."
The God Harris doesn't believe in is, as
he puts it, a "supernatural power" and
"a personal deity who hears prayers and
takes an interest in how people live."
This God and its subscribers he finds
unreasonable. But he understands that
M many people-especially in progres-
~ sive corners of organized religion and
§ 5 among the "spiritual but not religious" -1z often mean something else. They equate~iD God with "love" or "justice" or "singing in
~ chu rch" or "that feeling I get on a w a l k in
the woods," or even "the awesome aspects
of existence I'll never understand."
According to a 2008 study by the Pew
Forum on Religion and Public Life, a
quarter of Americans believe that God
is "an impersonal force." Among Cath-
olics, the Eastern Orthodox, and the
unaffiliated, the number rises to a third.
Among Jews, it's half. In a Gallup study
done' in May, 9 percent of respondents
said they believe.in a God who doesn't
answer prayers.
When polled about God, "people sub-
stitute in their own ideas," says John
Green, senior research adviser at Pew.
"People have a vague, fuzzy notion oftran-
scendence, and they substitute God for
it... When you try to make the defini-
tion more specific, fewer people answer
in the affirmative." Or put another way,
"If you let the concept of God float a
little bit, almost everybody is a theist,"
says Stephen Prothero, author of God
Is Not One. What Sam Harris believes
in-rationality, morality, transcendence,
humility, awe, community, selflessness,
and love-meets a fairly common def-
inition of God.
Harris says he became interested in
spiritual and philosophical questions
while an undergraduate at Stanford
University. At 18,he experimented with
the drug ecstasy and was struck by the
possibility that the human mind-his
own mind-might be able to achieve a
state ofloving unselfishness without the
help of drugs. So he left college and trav-
eled to India and Nepal, where he stud-
ied with Hindu and Buddhist teachers
who could help him attain a kind of
peace and selflessness through medi-
tation. Over the next 10 years, he readreligion and philosophy on his own and
spent weeks and months-adding up to
two years-in silent retreat.
He finally returned to Stanford to
complete a philosophy degree. Though
he prefers the Eastern mystics, he sees
some wisdom in the Western mystical
tradition as well. "If I open a page of [the
13th-century Christian mystic] Meister
Eckhart, I often know what he's talking
about." Harris pursued a doctorate in
neuroscience because he hoped sciencewould give him the tools to rationally
explore human experience.
Harris's true obsession, then, is not
God but consciousness, the idea that the
human mind can be taught-trained,
rationally-to bemore loving, more gener-
ous, less egocentric than it is in its natural
state. And though he knows that he can
sound like a person who believes in God,
he thinks that God is the wrong word to
describe his beliefs. "There's a real prob-
lem with the word," he says, "because it
shields the genuinely divisive doctrines
and believers from criticism. If the God
of the 25 percent is incredibly valuable,
which it is; and it's actually worth real-
izing, which it is; and it's something we
can talk about rationally, which it is; then
calling it 'God' prevents you from criticiz-
ing all the divisive nonsense that comes
with religion." Believing in transcen-
-dence is not the same thing as believ-
ing that you'll get virgins in paradise if
you blow yourself up-and Sam Harris
wants to be clear about that 0
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I RELIGION I RUSSIA
THE WAR LORD
THE K R E M L IN 'S P O S T E R B O Y F O R M O D E R A T E
IS L A M M A Y B E R A D IC A L IZ IN G T H E R E G IO N .
B¥ .f\NNA NEMTSOVA AND OWEN MATTHEWS
PHOTOGRAPHS BYDAVIDE MONTELEONEI
HE VIDEO SHOWS A GUN
barrel jutting from the
rear window of a shiny
black Lada sedan as it
cruises slowly down
, Putin Prospect, a new
boulevard of designer shops in the
Chechen capital, Grozny, Spotting a pair
of young women in long skirts but with-
out headscarves, the vehicle's occupants
open fire. The two pedestrians scream,
but they don't fall. A blot of red paint-ball ink is spreading across one young
woman's blouse. As the vehicle pulls
away, the camera shows the two women
dashing for safety into the nearest shop.
Chechnya's enforcers of supposed
Islamic propriety have struck again. In
the name of combating terrorism, Presi- ,
dent Ramzan Kadyrov has declared war
on what he regards as public indecency.
"My dream is for all our women to wear
scarves, in accordance with Islamic law,"
he told NEWSWEEK recently. To assist
in that fight and correct supposedly un-
Islamic conduct, he established his own
Taliban-style morality police, the Center
for Spiritual and Moral Development
and Education, last year. For backup,
Chechen militias prowl the streets in
black cars' and black uniforms, on the
alert riot onlyfer uncovered hair but for
short-sleeve IF shirts, short skirts, and
public displays of affection. Although
many Chechen women have accused
them of paintball attacks -in the pastfew months, Kadyrov brushes off the
charges, blaming "somebody who wants
to blacken my politics."
Kadyrov, 34, has become the standard-
bearer for the Kremlin's efforts to pacify
the rebellious North Caucasus once
and for all: His bare-knuckle style has
brought at least some degree oflaw and
order to Chechnya, and that crude suc-
cess is why the Kremlin trusts him. The
region has resisted Moscow's control for
centuries, but in the past decade or so,
MEMBER S OF TW O CHECHEN CLANS MEET TO MAKE PEACE -AFTER A 53-YEAR VENDETTA.
46 m OCTOBER '25 ,' 2Q .10
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A CEMETER Y ON THE W AY TO SH ATOI. CHECHNYA H AS BEEN FILLED W ITH CONFLICT FOR CENTUR IES .
the violence has spread and intensified
as Islarnist extremism has flourished
elsewhere in the world. "Our Afghani-stan is inside Russia,"says Masha
Lipman of the Moscow Carnegie Cen-
ter. Hundreds of civilians died after
Chechen rebels seized a Moscow theater
in 2002 and a school in Beslan in 2004.
This year, suicide bombers killed more
than 40 people in the Moscow subway
and more than 150 in a series of attacks
in the North Caucasus. The brutal tac-:
tics of the Russian military and its local
proxies have only boosted support for
the rebels.Now the country's leaders are trying
48 m OCTOBER 25, 201,0
a new approach. The idea is to culti-
vate a different, more docile strain of
Islam among Russia's estimated 20 mil-lion professed Muslims. To that end,
the Kremlin Is spending $300 million
to open seven new Islamic universities
in Russia and sponsoring hundreds of
students to pursue advanced degrees in
approved universities in Syria and Saudi
Arabia. Russian President Dmitry Med-
vedev has moved to boost the author-
ity of accredited imams, affirming that
they have "a special place" in Caucasian
society and calling on them to help the
Kremlin "confront terror through spiri-tuality and high ethical standards." At
the same time, the military is continuing
its efforts to hunt down and kill rebels
and radicals in the Caucasus.At first glance, Kadyrov might seem
to be the perfect tool for the Kremlin's
needs. Russian leader Vladimir Putin
(Kadyrov calls him "my idol") appointed
him president of Chechnya in 2007, as
soon as he became old enough to take the
post legally. His brand ofIslamis far from
the Saudi-derived Wahhabism espoused
by many of the Chechen rebels-sand by
Osama bin Laden. Instead it's an eclec-
tic blend of Sufism (a traditionally paci-
fist, mystical branch of the Sunni sect)and ancient Chechen traditions like the .
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,CHECHEN PRES IDENT KADYR OV HAS SA ID HE W OULD LIKE TO SEE ALL W OMEN IN HEADSCAR VES .
zikr, an all-male hybrid of circle dance
and prayer. His father, Ahmed Kadyrov,
had been Chechnya's chief mufti (spiri-tual leader) when the tiny mountain
republic tried to break Russia's grip in
the 1990S, but he eventually reconciled
with Moscow-and was assassinated in
2004. The younger Kadyrov now casts
himself as his father's spiritual and
political heir, delivering long sermons
to gatherings of religious students and
scholars, wearing the traditional robes
of a Sufi teacher, and proposing recently
that he renounce his title of president
in favor of mekkh-da, a Chechen term
meaning "father of the nation," usually
associated with the legendary imams
who led the resistance to Russian occu-
pation in the ioth century. In person,
he prefers to be addressed as Padisbab,
Farsi for emperor.
True to the Kremlin's wishes, Kady-
rov has set out to promulgate his own
idiosyncratic version of Islamic law in
place of the Wahhabi dictates of Mos-
cow's adversaries. Trouble is, it's not
always easy to see much difference.
"Sisters, we would like to remind you
that every Muslim woman is obliged to
wear a veil!" says a widely distributed
pamphlet issued by the Chechen state
publishing house Put ("The Path" in
Russian, and a pun on "Putin"). "Today
we mark you with paint-do not pro-
voke us to use harsher methods!" He's
poured millions into building mosques
all over Chechnya, tightly restricted the
sale of alcohol, and made the wearing
of Islamic attire compulsory in all Che-
chen schools and universities. The mo-
rality police are under his personal
direction; according to the human-
rights group Memorial, they punish
suspected prostitutes by shaving their
heads and eyebrows and painting their
scalps green, the color of Islam. Kady-
rov has also gone on record defend-
ing honor killings of "loose" women:
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K ADYROV M IGH T S EEM TO BE T H E P ER F ECT TOOL FOR T HE R U SS IA N GOVE R NMENT'S NEE DS ,
"If a woman runs around, and if a man
runs around with her, both of them are
killed," he said last year. And his educa-
tion policies strongly discourage access
to the outside world's "corrupting"
influences, such as the Internet.
Kadyrov's home life is a peculiar mix
of Sufi piety and the extravagant luxu-
ries of an old-fashioned warlord. He
often invites as many as a thousand loy-
alists at a time to his private compound
(it boasts its own mosque, a zoo, and a
park full of llamas) to dance the zikfforas much as five hours at a stretch. And
tears roll down his cheeks as he tells of
the pilgrimage he made to Mecca this
past july, He says Saudi King Abdullah
gave Kadyrov and 27 companions spe-
cial dispensation to enter Islam's holyof
holies, the Kaaba+the sacred black cube
at the heart of the city. Kadyrov says he
was so overcome with "euphoria" and
"absolute happiness" that on his return
he ordered 11 7 Chechen families to aban-
don their decades-old blood feuds andformally reconcile in the name of Allah.
50 m OCTOBER 25, 2010
Kadyrov vigorously promotes his
brand of Islam as an antidote to what
he calls "the evil so-calleddenomina-
tion Wahhabism." He's been lobbying
the Kremlin to place all Russian muftis
under the supervision of'Chechen imams,
who would draft a monthly sermon
covering religious and political issues
to be taught at all Russian mosques. "If
people in Russia do not take the path of
traditional, pure Sufi Islam, Russia will
lose out," says Kadyrov. "All the other
denominations, like Wahhabism, arenew inventions for our country-we have
never had it, and we will never accept
it." But the architect of the Kremlin's
new approach to Islam,' a non-Muslim'
academic named Yuri Mikhailov, warns
that endorsing Kadyrov's Sufism or
any other form ofIslamabove the others
would be a horrendous mistake, sure
to provoke a holy war between the sects.
,Meanwhile, Moscow pursues its
same old brutal policies in the region,
sabotaging its own efforts to encour-age peace and harmony. Well-meaning
Kremlin-funded scholars like Oleg Khi-
makov, deputy director of the Foun-
dation to Support Islamic Culture and
Education, may recruit Sharia legal
specialists from Islamic universities in
Qatar, Egypt, Oman, an~ Malaysia inthe name of weaning Russian Muslims
away from extremism. But in Chechnya
and its neighboring republics there's a
vast reservoir of bad blood from so many
years of relentless oppression. Villagers'
homes continue to be burned, although
now it's done by Chechen militias rather
than by Russian soldiers. And mistreat-
ment in custody is practically univer-
sal.: "Every arrest, every criminal case
opened in North Caucasus, involves tor-
ture, severe beatings in detention," saysOleg Orlov, Moscow director ofthe rights
group Memorial. '
Up in the mountains, no more than a
few miles from the fancy boutiques of
Putin Prospect, the rebellion contin-
ues. Several dozen insurgents attacked
Kadyrov's family village of Tsentroi in
late' August, torching cars and houses
and killing seven police officers who
were serving as his personal security
guards. Kadyrov personally led a retal-
iatory raid .a few days later, but the
rebels got away; he has promised a $3
million reward for information lead-
ing to the commanders of the assault.
Just outside Chechnya's borders, entire
villages in neighboring Dagestan have
been emptied of young men who have
fled to join the rebels in the moun-
tains rather than risk being killed by
Kremlin -backed death squads.
Russian authorities do their best to
suppress the almost daily reports ofclashes and bombings in the region. It's
possible that Kadyrov's version ofIslam,
combined with a continued heavy reli-
ance on extrajudicial disappearances
and torture, may provide the Kremlin
with a temporary means to curb the eth-
nic nationalism of the Caucasus rebels., '
But the cause oflong-term peace may be
ill served if those efforts only radicalize,
Russia's Muslims. Kadyrov, for his part,
seems unfazed. ''As long as Putin backs
me up, I can do everything," he says.''Allahu akbar!" 0
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As Singapore's first H:t1imeminister, Lee Kuan Yew,reflects on, '~'~':,i' t\ ~\
mortality, artists are experimenting with his image in their
BY'SONIA KOLESNIKOV-JESS0P4 '
\
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I CULTURE I ART
The vibrant water-
color shows a gaming table with three
playing cards, each depicting a different
portrait of the same man. Small figures
kneel at the corners pleading, "Papa,
can you help me not be frightened?"
and "Papa; don't YOl!- know I have no
choice?" They are lyrics .from the gay
anthem "Papa, Can You Hear Me?" from
the Barbra Streisand film Yentl; the man
featured on the cards is Lee Kuan Yew,
Singapore's first prime minister, who isoften described as a father figure-albeit
an authoritarian one-to the young
nation. New York-based Singaporean
artist Jimmy Ong incorporated the lyr-
ics to reflect the anxieties of a generation
of gay men in a city-state where homo-
sexual activity remains a criminal act
punishable by up to two years in prison,
while the card motif is a nod to the
much-debated opening of two casinos
earlier this year.
Ong's work is a relatively rare exampleof a contemporary artist incorporating
52 m OCTOBER 25, 2010
Lee's image, even though Lee has domi-
nated Singapore's political landscape
since the young nation's independence
in 1965.Lee stepped down as prime min-
ister in 1990 but has remained involved
in government and holds a cabinet posi-
tion with the title "minister mentor."
His image has the power to evoke strong
reactions, yet unlike Mao Zedong, whose
image has been embraced by legions of
Chinese artists, Lee has remained a dis-
tant, often taboo subject for many Singa-porean artists. "I can only speculate that
it is self-censorship at work," says Ong.
"Even in my artwork I am self-censoring,
like using Yentl's lyrics in: place of my
own voice."
But just as the 87-year-old Lee has
started in recent interviews to contem-
plate openly his own mortality, some
artists are also beginning to reflect on
Lee's life and legacy. Several recent
art exhibitions have used his image
to explore the notion of nationhood,though never too critically. "Reevalu-
ations are part of anyone's legacy, but
to do so while someone is still in office
colors the effort with all the anxiety of
politics," says Jason Wee, a Singaporean
artist also based in New York. "Mao is
no longer in office, and Lee still is."
Wee has been working on a series of
portraits of Lee, using shampoo bottle
caps arranged to create a pixelated effect.
Titled No More Tears, the portraits are
a nod to Lee's rare emotional moment
in 1965, when he cried on televisionannouncing the separation of Singapore
from Malaysia and Singapore's future
looked uncertain. Wee has also gone
beyond mere iconographic representa-
tion, examining how deeply the aging
statesman's influence runs over the city-
state's citizens. In the recent exhibition
Beyond LKY at Singapore's Valentine
Willie Fine Art Gallery, artists were
asked to reflect on a Singapore without
Lee. Wee installed a tall, dark, granite
sculpture in the shape of the numberone, inscribed with the words IN MEM-
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ORY OF MY FATHER, m. _S elf -P o r tr a it ( Y el lo w , G
Lee) , an ink portrai 1
ist looks like Lee.
ongwith
,. Red Mr.
Lee's influence OD
tive and negative, .
use his iconograp .
The British had
promoting Sir
other colonial figurSingapore, and to
statue of the "founder
gapore still stands pro ong the Sin-
gapore River. Surpri inz _, ever since
the city-state gained independence in
1965, it has continued 0 celebrate the
names of colonial pioneers on monu-
ments, streets, and bridges, rather than
embrace new modern-cia: heroes .. Asthe first generation of political pioneers
has begun to pass on, there have been
occasional calls to celebrate them and
their achievements, but the Singapor-
ean government, and in particular Lee,
has always shied away from anything
that could be construed as creating a
cult of personalities.
Few of Asia's other longtime leaders
have hesitated using public art to pro-
mote themselves; Philippine President
Ferdinand Marcos had his own bust
carved into .a hillside in central Luzon,
and Mao's image was so pervasive that
it was not only on official buildings,
but also in every single household. Lee
has preferred the nation building to
be carried out in other media, such as
newspapers and textbooks. "The cult of
personality makes him uncomfortable,"
says Tom Plate, author of Conversat ions
W ith Lee Kuan Y ew . "He thinks it's tacky.
Until very recently, he didn't even want
to talk much about aspects of personal-
ity and his personal life."Gallery owner Valentine Willie points
out that artists have probably been reti-
cent to use Lee's image in their works,
because officially, the use of any cabinet
minister's image requires approval from
the Media Development Authority. Yethe
also acknowledged that at his recent exhi-
bition he did not seek any permission nor
did he encounter any problems. Indeed,
some of the works were reproduced sev-
eral times in the state-controlled media,
which could be considered a subtle
endorsement. "The greatest censorship is
self-censorship," says Willie. "We've lived
for so long under a regime where we can't
do this or that, it's almost ingrained in our
psyche that we don't go there."
That's definitely changing. A finalist
for the 2010 Sovereign Asian Art prize,
whose. winner will be announced early
next year, is an oil painting in the pop-
art style of a young Lee relaxing with his
family. Itis by Ong Hui Har, who tackled
the private side of the political leader in
a one-woman show earlier this year. Thetrue test will be ifand when she and her
colleagues tackle the other side. 0
NEWSWEEK. COM m 53
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I CULTURE I MOVIES
C inaonMyMindIn is latest film, Under the Hawthorn
Tree, Chinese director Zhang Yimou ex-
plores a story of young love in 1970s ruralChina. The movie, which opened the pres-
tigious Pusan International Film Festival
last week, features fresh-faced actors
with no box-office track record. It repre-
sents a departure from Zhang's previous
works, including the 2002 martial-arts hit
Hero, which went on to become one of the
highest-grossing foreign-language films
in America, and last year's A Woman, a .
Gun, and a Noodle Shop, a remake of the
Coen brothers' 1984 film Blood Simple.
With Hawthorn Tree, based on a popu-
lar novel made famous on the Internet,
Zhang, 58, breaks with the norms of
Chinese high eulture,creating a simple
romance that is expected to have mass
appeal. He spoke with NEWSWEEK'sAlex-
andra A. Seno. Excerpts:
What about the novel Under the
Hawthorn Tree compelled you
make this film?
A friend happened to. r ecommend it to.
me. After reading the novel, I was very
moved in a way I had not felt fora long
time. Itspeaks to.my generation, evoking
many memories of those years. Maybe
everyone has their own feelings of an
innocent love,
You set it against the Cultural Revo-
lution. What does that period mean?
The Cultural Revolution is a special
moment, In the modern history of
China, it is .veryImportant. It is, the
memory of my youth, the time when I
was 16to.26 years old.
54 m OCTOBER 25,2010
'Ichoose
projects
based on
the story.
The scope
doesn't
matter
Since your first film, 1987'SRed
Sorghum, how has the audience for
movies in China changed?In China, moviegoers are getting younger,
mainly people born in the 198QS and
199QS. They are definitely different from
the audiences of the past. They have a
variety of tastes, but mainly they like
entertaining films and, of course, they
like Hollywood films.
How does pop culture influence you?
In films, most of us come from tradi-
tional culture and are all facing this
dilemma: how to.deal with pop culture.Moviegoers are mostly from a younger
generation, We want to. guide them
and please them, but we don't want to.
be like old people talking to. ourselves,
There is a Taoist-inspired Chi-
nese saying: "Find art's essen-
tial nature." .
In your lifetime, do you
believe you will see broad
acceptance of Chinese films
in America? I
I don't know when that day
will arrive. Ang Lee's Crouch-
ing Tiger had kind of done
SQ. I hope we will see more
of this. The difficulty with
Chinese films is that we need
subtitles and, so. far, American audi-
ences prefer action movies, So. it may
take some time before our films get
to me.'
wide acceptance in America.
You directed the opening and
closing ceremonies of the 2008
Olympics, designing lavish operas
and light and sound shows. Then
you made two small- budget films,A Woman, a Gun and a Noodle Shop
and Hawthorn Tree. Next you are
making a big-budget film about a
sensitive issue, the Sino-Japanese
War of the 1930S. Why?
I bought the rights to. this novel in 20.0.7,
before the Olympics. I have been plan-
ning to.make The Thirteen Women oflin,
ling for many years, I like it very much
because it gives a different perspective
on the China-Japan issue. It is about
13 Nanjing prostitutes who. protect agroup of schoolgirls. The prostitutes
dress up as the girls and go. to. the Japa-
nese Army camps in their place. It is a
brilliant story, looking at the war from
a woman's perspective. I don't
decide to.make a film depending
on how big or small it is. I choose
projects based on the story, The
scope doesn't matter to.me. This
film will be pretty big, though,
We are hoping to. find a leading
m~n from Hollywood-It will be a
story about.human nature.
In your work, how do you
balance art and government
policy in China?
All filmmakers must deal with
[the censorship regulations], It is a fact
that we cannot change. As, a director, I
do. not pursue politics in my films. I'm
mo.re interested in human nature. I
hope one day censorship will become
more relaxed as China o.pens up, and
artists will have more freedom. D
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I THE GOOD LIFE I
even winds usually create ideal condi-
tion . Kelemen has been kayaking this
teal-blue coastline since the 1970S and
now m\'TIS an adventure-travel company
called Huck Finn, which offers five- and
eight-day kayaking, biking, and hikingitineraries that mix nature and local cul-
ture. "There's much to explore inland as
well, with fortresses, small churches,
and monasteries rich in medieval art
tucked among the green hills," he says .
. Three years ago Kelemen bought a
French-designed ia-meter catamaran
to be used as the mother ship on these
journeys. Itfollowed our group of six in
double and single kayaks along the Cro-
atian coast until we were exhausted and
hungry. We had the option of sleeping
either on the four-bedroom, four-bath
yacht or in private homes with families
along the way. No cares. No clocks. No
meals to prepare. Just the luxury of lei-
surely island hopping. Or so I thought. I
On day one I flipped the kayak as Iwas
pulling away from, shore on a solo test
run in water that barely came up to my ,
knees. Then I got seasick during an open-
water, crossing from Kolocep island toLopud, two of the Elafiti Islands seen
56 t t l OCTOBER 25, 2010
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The goal most days
was to kayak around
one island, and swim
in the sea, bike, or
hike among olive
groves and fig trees.
Almost always,we
were alone as a
group, snorkeling in
hidden bays, then
docking for dinner in
villages unspoiled by
Ii'v;
~:I:
Iz
<i
~w>
ff i:I:
:i
" ':"> -u,
o> -ff i>:
Ii :
~c
ur
z[ from Dubrovnik. A storm was brewing;: : : ;
~ the wind roared, and the waves roiled.
~ "Pick a spot on the island infront of u s and~Ii : keep y0UJ7 eyes on that spot," advised the:J
8 woman behind me in our two-person
g kayak, whom I had just met over lunch that"Ifternoon. "Don't look away. Itwill trick
1 ii your mind into thinking you're on land."
~ I found the strength to look up, but
~ not the energy to thank her. A little
~ while later I stopped paddling and gave
~ her a thumbs-up. "Feeling better'?" she!asked, still concerned. I nodded. ever
~ before had I been so terrified and~i;;
mass tourism.
enchanted by the force of nature.
~ When we reached the sandy beach of
: Lopud, an island 'without cars, it was
~ dinnertime but light enough to see hill·
~ tops of terra-cotta cla roofs and master: : : ;
~' gardens in shades of lavender, pink, and
~ yellow. Grapevines bung over the front
~ gates of the houses. We learned that the
g ; history of gardening in the region dates
~ back centuries. "The leading families~ were spared from war for much of the
CLOSE TO SHORE
Scenic _Sculling
medieval period and, with trade, were
getting rich," says Kelemen, whose
parents .were born in Croatia. ''As the
noble women started competing over
who would have more gold and jew-elry, the wise Senate made a rule: only
prostitutes were allowed to wear gold in
public. So the noble women began com-
peting over who would have the biggest
house and most beautiful garden."
Our route covered 66 stunning,
arduous kilometers. The greatest hits
included the stone-walled city of Ston,
with its limestone cliffs and cobbled
streets, art exhibits and wine tastings,
and an island in the middle of Mljet
National Park, which houses a azth-
century Benedictine monastery. The
'monastery sits near the center of the
Iwine-growing area of the Peljesac pen-
insula, which, recent DNA analysis has
proved, is the source of the grapes that
make California zinfandels.
The goal on most days was to kayak.
to, and around, one island and, if you
were feeling ambitious, swim in the sea,
bike, or hike through hilltops of olive
groves and fig trees. Almost, always,we were alone as a group, snorkeling in
hidden shallow bays Kelemen located,
and then 'docking for dinner in villages
unspoiled by mass tourism,
By the last day, I had mastered the
patience needed to produce an even,
smooth stroke, and to respect the
rhythm of the tide without flipping. The
sea had introduced me to a world that,
in many places, hadn't changed in a
thousand years. Next time, I will have to
learn better balance so I can look up and"take pictures. 0
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ITHE LAST WORD I
KHAL D ESHAAL
' R , E I S S T A N C E IS T H E R E A L O P T IO N '
Few fiqures in the Mid,dle East incite
controversy like Khaled Meshaal, the
54-year-old leader of Hamas. To many
Palestinians, Meshaal embodies justified,
radical nationalism. Israelis, meanwhile,
consider him the architect of bloody sui-
cide bombings and rocket attacks. In a
1997 assassination attempt, Israeli intel-
ligence squirted nerve toxin in his ear.
He survived, rose through the ranks, and
today he caUs the shots from his perch in
Damascus. NEWSWEEK'sBabak Dehghan-
pisheh and Ranya Kadri sat down with him
there last week. Excerpts:
Would you accept a two-state solution
based on the 1967 borders?
I can answer your theoretical ques-
tion, but this is not expected to happen.
There is a position and program that
all Palestinians share: to accept a Pales-
tinian state on the 1967 borders with
Jerusalem as the capital with the right of
return. This state would have real
sovereignty on the land and on the bor-
ders. And no settlements.
What is Hamas's role in the peace
process?
The lesson of negotiation is that without
real pressure on the Israelis, they will
not withdraw to the 1967 borders. Yes,
we are with diplomacy and politics, but
resistance is the real option.
Under what conditions would you
stop using violence? J
I'm a physicist, and I believe in the equa-
tions of physics and mathematics. So,
60 III OCTOBER 25,2010
it's not a vicious cycle with no beginning
and no end. Itbegan with the occupation
and will end with the end of occupation.
The resistance definitely has its victims,
and it's a painful, steep price. But why is
resistance different in Palestine? When
the French fought Hitler and the Nazi
occupation, it was called resistance.
When the Americans fought the Brit-
ish, it was called the independence war.
Hamas has no military activities outside
of Palestine.
How much of this conflict ispersonal?
The conflict with [Israeli Prime Minister
Benjamin] Netanyahu is not personal.
Our calculation is a national issue.
It happened because the American ad-
ministration, the international com-
munity, and, unfortunately, regional
countries refused to recognize the result
[of the 2006 elections]. This is the oppo-
site ofthe principles of America and the
West. We realize this internal dispute
hurts Hamas and the whole Palestin-
ian cause. But we were not the ones who
chose this. Itwas forced on us.
Do you receive money, weapons, and
military training from Iran?
With regard to weapons, this is a ques-tion for the military wing. With regard
to the money, Hamas welcomes finan-
cial support from any party in the world
as long as it's unconditional.
'H AMAS WELCOMES F INANCIAL SUPPORT
FROM ANY PAR TY IN THE WOR LD , AS LONG
AS IT 'S UNCONDIT IONAl.'
Would you sit across a table from
Netanyahu in negotiations?
[Laughs] I'm interested in results: for
the Palestinian people to reach freedom,
to get their rights, to get rid of the Israeli
occupation and the settlements, a_ndto
live freely in a sovereign land with self-
determination.
Do you see improved relations
between Hamas and Fatah anytime in
the near future?
Why did this internal struggle happen?
Does money come from the Iranian
government without conditions?
Of course. There's also money from
other parties around the world, without
conditions.
If there is a two-state solution;
what position do you see for
yourself?
[Laughs] I don't seek positions. And
I can't guarantee that I'll be alive
then. What's important is for my people
to be free.