The A-List

America’s newly minted top diplomat hasn’t yet finished his nine-country, 11-day swing through Europe and the Middle East, his first overseas trip as secretary of state, but the first tough reviews are already in print. It doesn’t help that John Kerry’s most widely reported comment thus far was a boast to German students that Americans “have a right to be stupid” or that, as if to prove his point, he seemed to create a new central Asian republic known as “Kyrzakhstan”. He’s “off to shaky start”, warned one headline. “Kerry hits a bumpy road in world diplomacy” announces another. Read more

The administration is now vigorously blaming the Republicans for the sequestration – but the surprising truth is that from the start of his time in office, the president has planned a steep shrinkage of discretionary spending as a share of national income. Read more

Credibility is seeping away from the Bank of England’s Monetary Policy Committee. The minutes released last week revealed fundamental differences of view at best and muddle at worst within the committee. They showed that three of the nine votes cast were in favour of a change in policy. Read more

Barack Obama might prefer to focus his energies on immigration, gun control and education. But it is the tax and spending wars that still paralyse Washington, and the US is on the verge of a dismal solution – the sequestration. Unless a new budget deal can be agreed within the next few days, almost all forms of so-called “discretionary” spending, departmental budgets that the US Congress sets each year, will be cut equally and indiscriminately – beginning next week. Read more

Today’s world of dysfunctional politics is one that pushes central banks further away from their comfort zone and excludes the best possible responses. The resulting inconsistencies can only be resolved through a more comprehensive policy approach that deals directly with the West’s challenges of too little growth, too much debt, and too polarised a political discourse. In the meantime, central banks will have no choice but to opt for what they perceive as the lesser of two evils – that of maintaining a visibly imperfect policy stance.  Read more

Brussels should request from Paris a serious plan for public spending cuts. The French 2013 budget adjustment was mostly based on tax increases. The government has announced that further consolidations would come from public spending cuts. This is however a rather weak commitment because President François Hollande has not spelt out precise priorities, let alone targets. It is not enough to say that some government spending will be cut. France must say which and when. Read more

The US and Nato are more earnestly than ever trying to speed up peace talks between them, the Afghan and Pakistani governments and the Taliban. But they will falter again, just as they have done in the past until the US is prepared to make a radical break with the past format of negotiations and understand the importance of mediation.

But what we have seen in the on and off talks between the US and the Taliban is essentially that Washington acts as both the most powerful party in the conflict and as a mediator. The result has been that Kabul, Islamabad, the Taliban and others have put demands on the table which they expect the US to reply to as the lead party, but they also expect America to mediate each others’ demands so that both sides can reach a compromise and move forward. Read more

The leaders of the largest economies have tried to talk down the risk of a currency war. This will not necessarily be sufficient to avoid one. The reason is that there is no longer a shared view across leading industrial countries about the role monetary policy should play in the current environment. Read more

The reality is that, despite many commitments by national leaders, the capacity of nation-states to coordinate their responses has dwindled. Problems may have gone global but the politics of solving them are as local as ever. It is hard for governments to devote resources to problems beyond their national borders and to work with other nations to address these challenges – while painful problems at home remain unsolved. Read more

Tokyo should do what it can to rebuild trust with Beijing – not by giving ground on disputed East China Sea islands but by agreeing to put the issue on the shelf. Better to focus on restoring a relationship that can strengthen both economies – and, by extension, the domestic credibility of both governments. Read more