SYDNEY, Australia — All across the Asia-Pacific region, the countries that led the world in containing the coronavirus are now languishing in the race to put it behind them.
While the United States, which has suffered far more grievous outbreaks, is now filling stadiums with vaccinated fans and cramming airplanes with summer vacationers, the pandemic champions of the East are still stuck in a cycle of uncertainty, restrictions and isolation.
In southern China, the spread of the Delta variant led to a sudden lockdown in Guangzhou, a major industrial capital. Taiwan, Vietnam, Thailand and Australia have also clamped down after recent outbreaks, while Japan is dealing with its own weariness from a fourth round of infections, spiked with fears of viral disaster from the Olympics.
the new outbreak in southern China will affect busy port terminals there. Across Asia, faltering vaccine rollouts could also open the door to spiraling variant-fueled lockdowns that inflict new damage on economies, push out political leaders and alter power dynamics between nations.
The risks are rooted in decisions made months ago, before the pandemic had inflicted the worst of its carnage.
blocked the export of 250,000 doses of the AstraZeneca vaccine meant for Australia to control its own raging outbreak. Other shipments were delayed because of manufacturing issues.
“The supplies of purchased vaccine actually landing on docks — it’s fair to say they are not anywhere near the purchase commitments,” said Richard Maude, a senior fellow at the Asia Society Policy Institute in Australia.
with the United States and Europe.
In Asia, about 20 percent of people have received at least one dose of a vaccine, with Japan, for example, at just 14 percent. By contrast, the figure is nearly 45 percent in France, more than 50 percent in the United States and more than 60 percent in Britain.
Instagram, where Americans once scolded Hollywood stars for enjoying mask-free life in zero-Covid Australia, is now studded with images of grinning New Yorkers hugging just-vaccinated friends. While snapshots from Paris show smiling diners at cafes that are wooing summer tourists, in Seoul, people are obsessively refreshing apps that locate leftover doses, usually finding nothing.
“Does the leftover vaccine exist?” one Twitter user recently asked. “Or has it disappeared in 0.001 seconds because it is like a ticket for the front-row seat of a K-pop idol concert?”
keep its borders closed for another year. Japan is currently barring almost all nonresidents from entering the country, and intense scrutiny of overseas arrivals in China has left multinational businesses without key workers.
The immediate future for many places in Asia seems likely to be defined by frantic optimization.
China’s response to the outbreak in Guangzhou — testing millions of people in days, shutting down entire neighborhoods — is a rapid-fire reprise of how it has handled previous flare-ups. Few inside the country expect this approach to change anytime soon, especially as the Delta variant, which has devastated India, is now beginning to circulate.
has threatened residents with fines of around $450 for refusing vaccines. Vietnam has responded to its recent spike in infections by asking the public for donations to a Covid-19 vaccine fund. And in Hong Kong, officials and business leaders are offering a range of inducements to ease severe vaccine hesitancy.
Nonetheless, the prognosis for much of Asia this year is billboard obvious: The disease is not defeated, and won’t be anytime soon. Even those lucky enough to get a vaccine often leave with mixed emotions.
“This is the way out of the pandemic,” said Kate Tebbutt, 41, a lawyer who last week had just received her first shot of the Pfizer vaccine at the Royal Exhibition Building near Melbourne’s central business district. “I think we should be further ahead than where we are.”
Reporting was contributed by Raymond Zhong in Taipei, Taiwan, Ben Dooley in Tokyo, Sui-Lee Wee in Singapore, Youmi Kim in Seoul and Yan Zhuang in Melbourne, Australia.
In less polarized times, Dr. Shi was a symbol of China’s scientific progress,at the forefront of research into emerging viruses.
She led expeditions into caves to collect samples from bats and guano, to learn how viruses jump from animals to humans. In 2019, she was among 109 scientists elected to the American Academy of Microbiology for her contributions to the field.
“She’s a stellar scientist — extremely careful, with a rigorous work ethic,” said Dr. Robert C. Gallo, director of the Institute of Human Virology at the University of Maryland School of Medicine.
The Wuhan Institute of Virology employs nearly 300 people and is home to one of only two Chinese labs that have been given the highest security designation, Biosafety Level 4. Dr. Shi leads the institute’s work on emerging infectious diseases, and over the years, her group has collected over 10,000 bat samples from around China.
Under China’s centralized approach to scientific research, the institute answers to the Communist Party, which wants scientists to serve national goals.“Science has no borders, but scientists have a motherland,” Xi Jinping, the country’s leader, said in a speech to scientists last year.
Dr. Shi herself, though, does not belong to the Communist Party, according to official Chinese media reports, which is unusual for state employees of her status. She built her career at the institute, starting as a research assistant in 1990 and working her way up the ranks.
Dr. Shi, 57, obtained her Ph.D. from the University of Montpellier in France in 2000 and started studying bats in 2004 after the outbreak of severe acute respiratory syndrome, or SARS, which killed more than 700 people around the world. In 2011,she made a breakthrough when she found bats in a cave in southwestern China that carried coronaviruses that were similar to the virus that causes SARS.
There were two weeks left in the Trump administration when the Treasury Department handed down a set of rules governing an obscure corner of the tax code.
Overseen by a senior Treasury official whose previous job involved helping the wealthy avoid taxes, the new regulations represented a major victory for private equity firms. They ensured that executives in the $4.5 trillion industry, whose leaders often measure their yearly pay in eight or nine figures, could avoid paying hundreds of millions in taxes.
The rules were approved on Jan. 5, the day before the riot at the U.S. Capitol. Hardly anyone noticed.
The Trump administration’s farewell gift to the buyout industry was part of a pattern that has spanned Republican and Democratic presidencies and Congresses: Private equity has conquered the American tax system.
one recent estimate, the United States loses $75 billion a year from investors in partnerships failing to report their income accurately — at least some of which would probably be recovered if the I.R.S. conducted more audits. That’s enough to roughly double annual federal spending on education.
It is also a dramatic understatement of the true cost. It doesn’t include the ever-changing array of maneuvers — often skating the edge of the law — that private equity firms have devised to help their managers avoid income taxes on the roughly $120 billion the industry pays its executives each year.
Private equity’s ability to vanquish the I.R.S., Treasury and Congress goes a long way toward explaining the deep inequities in the U.S. tax system. When it comes to bankrolling the federal government, the richest of America’s rich — many of them hailing from the private equity industry — play by an entirely different set of rules than everyone else.
The result is that men like Blackstone Group’s chief executive, Stephen A. Schwarzman, who earned more than $610 million last year, can pay federal taxes at rates similar to the average American.
Lawmakers have periodically tried to force private equity to pay more, and the Biden administration has proposed a series of reforms, including enlarging the I.R.S.’s enforcement budget and closing loopholes. The push for reform gained new momentum after ProPublica’s recent revelation that some of America’s richest men paid little or no federal taxes.
nearly $600 million in campaign contributions over the last decade, has repeatedly derailed past efforts to increase its tax burden.
Taylor Swift’s back music catalog.
The industry makes money in two main ways. Firms typically charge their investors a management fee of 2 percent of their assets. And they keep 20 percent of future profits that their investments generate.
That slice of future profits is known as “carried interest.” The term dates at least to the Renaissance. Italian ship captains were compensated in part with an interest in whatever profits were realized on the cargo they carried.
The I.R.S. has long allowed the industry to treat the money it makes from carried interests as capital gains, rather than as ordinary income.
article highlighting the inequity of the tax treatment. It prompted lawmakers from both parties to try to close the so-called carried interest loophole. The on-again, off-again campaign has continued ever since.
Whenever legislation gathers momentum, the private equity industry — joined by real estate, venture capital and other sectors that rely on partnerships — has pumped up campaign contributions and dispatched top executives to Capitol Hill. One bill after another has died, generally without a vote.
An Unexpected Email
One day in 2011, Gregg Polsky, then a professor of tax law at the University of North Carolina, received an out-of-the-blue email. It was from a lawyer for a former private equity executive. The executive had filed a whistle-blower claim with the I.R.S. alleging that their old firm was using illegal tactics to avoid taxes.
The whistle-blower wanted Mr. Polsky’s advice.
Mr. Polsky had previously served as the I.R.S.’s “professor in residence,” and in that role he had developed an expertise in how private equity firms’ vast profits were taxed. Back in academia, he had published a research paper detailing a little-known but pervasive industry tax-dodging technique.
$89 billion in private equity assets — as being “abusive” and a “thinly disguised way of paying the management company its quarterly paycheck.”
Apollo said in a statement that the company stopped using fee waivers in 2012 and is “not aware of any I.R.S. inquiries involving the firm’s use of fee waivers.”
floated the idea of cracking down on carried interest.
Private equity firms mobilized. Blackstone’s lobbying spending increased by nearly a third that year, to $8.5 million. (Matt Anderson, a Blackstone spokesman, said the company’s senior executives “are among the largest individual taxpayers in the country.” He wouldn’t disclose Mr. Schwarzman’s tax rate but said the firm never used fee waivers.)
Lawmakers got cold feet. The initiative fizzled.
In 2015, the Obama administration took a more modest approach. The Treasury Department issued regulations that barred certain types of especially aggressive fee waivers.
But by spelling that out, the new rules codified the legitimacy of fee waivers in general, which until that point many experts had viewed as abusive on their face.
So did his predecessor in the Obama administration, Timothy F. Geithner.
Inside the I.R.S. — which lost about one-third of its agents and officers from 2008 to 2018 — many viewed private equity’s webs of interlocking partnerships as designed to befuddle auditors and dodge taxes.
One I.R.S. agent complained that “income is pushed down so many tiers, you are never able to find out where the real problems or duplication of deductions exist,” according to a U.S. Government Accountability Office investigation of partnerships in 2014. Another agent said the purpose of large partnerships seemed to be making “it difficult to identify income sources and tax shelters.”
The Times reviewed 10 years of annual reports filed by the five largest publicly traded private equity firms. They contained no trace of the firms ever having to pay the I.R.S. extra money, and they referred to only minor audits that they said were unlikely to affect their finances.
Current and former I.R.S. officials said in interviews that such audits generally involved issues like firms’ accounting for travel costs, rather than major reckonings over their taxable profits. The officials said they were unaware of any recent significant audits of private equity firms.
No Money Owed
For a while, it looked as if there would be an exception to this general rule: the I.R.S.’s reviews of the fee waivers spurred by the whistle-blower claims. But it soon became clear that the effort lacked teeth.
Kat Gregor, a tax lawyer at the law firm Ropes & Gray, said the I.R.S. had challenged fee waivers used by four of her clients, whom she wouldn’t identify. The auditors struck her as untrained in the thicket of tax laws governing partnerships.
“It’s the equivalent of picking someone who was used to conducting an interview in English and tell them to go do it in Spanish,” Ms. Gregor said.
The audits of her clients wrapped up in late 2019. None owed any money.
The Mnuchin Compromise
As a presidential candidate, Mr. Trump vowed to “eliminate the carried interest deduction, well-known deduction, and other special-interest loopholes that have been so good for Wall Street investors, and for people like me, but unfair to American workers.”
wanted to close the loophole, congressional Republicans resisted. Instead, they embraced a much milder measure: requiring private equity officials to hold their investments for at least three years before reaping preferential tax treatment on their carried interests. Steven Mnuchin, the Treasury secretary, who had previously run an investment partnership, signed off.
McKinsey, typically holds investments for more than five years. The measure, part of a $1.5 trillion package of tax cuts, was projected to generate $1 billion in revenue over a decade.
credited Mr. Mnuchin, hailing him as “an all-star.”
Mr. Fleischer, who a decade earlier had raised alarms about carried interest, said the measure “was structured by industry to appear to do something while affecting as few as possible.”
Months later, Mr. Callas joined the law and lobbying firm Steptoe & Johnson. The private equity giant Carlyle is one of his biggest clients.
‘The Government Caved’
It took the Treasury Department more than two years to propose rules spelling out the fine print of the 2017 law. The Treasury’s suggested language was strict. One proposal would have empowered I.R.S. auditors to more closely examine internal transactions that private equity firms might use to get around the law’s three-year holding period.
The industry, so happy with the tepid 2017 law, was up in arms over the tough rules the Treasury’s staff was now proposing. In a letter in October 2020, the American Investment Council, led by Drew Maloney, a former aide to Mr. Mnuchin, noted how private equity had invested in hundreds of companies during the coronavirus pandemic and said the Treasury’s overzealous approach would harm the industry.
The rules were the responsibility of Treasury’s top tax official, David Kautter. He previously was the national tax director at EY, formerly Ernst & Young, when the firm was marketing illegal tax shelters that led to a federal criminal investigation and a $123 million settlement. (Mr. Kautter has denied being involved with selling the shelters but has expressed regret about not speaking up about them.)
On his watch at Treasury, the rules under development began getting softer, including when it came to the three-year holding period.
Monte Jackel, a former I.R.S. attorney who worked on the original version of the proposed regulations.
Mr. Mnuchin, back in the private sector, is starting an investment fund that could benefit from his department’s weaker rules.
A Charmed March
Even during the pandemic, the charmed march of private equity continued.
The top five publicly traded firms reported net profits last year of $8.6 billion. They paid their executives $8.3 billion. In addition to Mr. Schwarzman’s $610 million, the co-founders of KKR each made about $90 million, and Apollo’s Leon Black received $211 million, according to Equilar, an executive compensation consulting firm.
now advising clients on techniques to circumvent the three-year holding period.
The most popular is known as a “carry waiver.” It enables private equity managers to hold their carried interests for less than three years without paying higher tax rates. The technique is complicated, but it involves temporarily moving money into other investment vehicles. That provides the industry with greater flexibility to buy and sell things whenever it wants, without triggering a higher tax rate.
Private equity firms don’t broadcast this. But there are clues. In a recent presentation to a Pennsylvania retirement system by Hellman & Friedman, the California private equity giant included a string of disclaimers in small font. The last one flagged the firm’s use of carry waivers.
The Biden administration is negotiating its tax overhaul agenda with Republicans, who have aired advertisements attacking the proposal to increase the I.R.S.’s budget. The White House is already backing down from some of its most ambitious proposals.
Even if the agency’s budget were significantly expanded, veterans of the I.R.S. doubt it would make much difference when it comes to scrutinizing complex partnerships.
“If the I.R.S. started staffing up now, it would take them at least a decade to catch up,” Mr. Jackel said. “They don’t have enough I.R.S. agents with enough knowledge to know what they are looking at. They areso grossly overmatched it’s not funny.”
TRAPPES, France — It all began when a high-school teacher warned that Islamists had taken over the city. The teacher went on TV, issuing alarms from inside what he called a “lost city” of the French Republic. In Trappes, he said, he feared for his life.
“Trappes, it’s finished,” the teacher said. “They’ve won.”
The mayor, a strong believer in the Republic, saw the teacher on television and didn’t recognize the city he described. He knew his city, west of Paris and with a growing population of immigrants and Muslims, had problems but thought it was being falsely maligned. The mayor also happened to be a Muslim.
“The truth doesn’t matter anymore,” he said.
For a few weeks this winter, the fight pitting the mayor, Ali Rabeh, 36, against the teacher, Didier Lemaire, 55, became a media storm that, beneath the noise and accusations, boiled down to a single, angry question that runs through the culture wars rippling through France: Can Islam be compatible with the principles of the French Republic?
Lupin.” But Trappes also saw about 70 of its youths leave for jihad to Syria and Iraq, the largest contingent, per capita, from any French city.
article about Mr. Lemaire, who said he was quitting because of Islamists.
Within a few hours, a conservative politician eyeing the presidency tweeted her support for Mr. Lemaire and “all those hussars on the front line in the fight for the Republic.” Next, the far-right leader, Marine Le Pen, attacked “certain elected officials” for failing to protect the teacher from Islamists.
That the words of a virtually unknown teacher resonated so much was a sign of the times. A few months earlier, an extremist had beheaded a middle-school teacher for showing caricatures of the Prophet Muhammad in a class on free speech. President Emmanuel Macron was now pushing a bill to fight Islamism even as he pledged to nurture an “Islam of France.”
Mr. Lemaire’s words also resonated because of the outsized role in France of public schoolteachers, who are responsible for inculcating in the young the nation’s political values and culture. In the Republic’s mythology, teachers are the “hussars” — the light cavalry once used for scouting by European armies — fighting to preserve the nation’s sanctity.
In the article, Mr. Lemaire said he had been under police escort for months. Trappes’s mayor, he said, had called him an “Islamophobe and racist.” He said he was waiting for an “exfiltration” from deep inside “a city lost for good.”
Overnight, the soft-spoken, longhaired teacher, who said he preferred curling up with Seneca than going on Facebook, was issuing dire warnings on top television news shows.
“We have six months to a year,” he said, “because all these youths who are educated with the idea that the French are their enemies, they’ll take action one day.”
Mr. Lemaire arrived in Trappes, a banlieue, or suburb, in the outer orbit of Paris, two decades earlier. Once a village that grew around a millennium-old Roman Catholic parish, Trappes is now a city of 32,000.
Mr. Lemaire’s high school, La Plaine-de-Neauphle, stands at the heart of an area built to accommodate immigrant workers from France’s former colonies in the 1970s — a mixture of rent-subsidized high-rises, attractive five-story residences and a constellation of parks. The mosque is nearby. So is a market where vendors offer delicacies from sub-Saharan Africa and halal products.
Parti républicain solidariste, which espouses a hard line on France’s version of secularism, called laïcité. He now favors taking girls away from their parents, after a second warning, if the children violate laïcité rules by putting on Muslim veils during school field trips.
“We have to protect children from this manipulation,” of being used “as soldiers or as ideologues,” he said.
‘I See Myself In Them’
remarks to the newspaper Le Monde, the local préfet, the top civil servant representing the central government, praised Mr. Rabeh’s administration for its “total cooperation” in combating Islamism. The préfet also refuted the teacher’s claim to having been under a police escort.
The teacher’s story began wobbling. He admitted to the French news media, as he did to The Times, that he had “not received explicit death threats.” He had also accused the mayor of calling him a “racist and Islamophobe” in an interview with a Dutch television network.
But the network denied the mayor had said any such thing.
‘France Really Doesn’t Like Us’
letter to the students at the teacher’s high school.
“Don’t let anybody ever tell you that you’re worth nothing and that you’re lost to the Republic,” he wrote.
debate was scheduled that evening between Ms. Le Pen and Gérald Darmanin, the interior minister leading the government’s crackdown on Islamism. Hours before the debate, he announced that the teacher would be granted police protection.
That evening, Jean-Michel Blanquer, the national education minister, issued a statement supporting the teacher. He also accused the mayor of trespassing into the high school to distribute tracts — the letter — that morning. “Political and religious neutrality is at the heart of the operation of the School of the Republic,” the minister said.
The city officials at the school that morning told The Times that no copies were distributed inside. The regional education office and Mr. Blanquer’s office refused to make the school principal available for an interview. The minister’s office declined to comment.
The trespassing accusations led to such an avalanche of threats against the mayor that he, too, was put under police protection — a shared destiny, for a while, for the two men of Trappes, who had each lost something.
The teacher was forced to leave the school where he had taught for 20 years and, despite his criticisms of Trappes, said “you really feel you’re on a mission.” He said he should have been more careful with the facts and had made “many mistakes,” but stuck by his interpretation of Trappes as “lost.”
His words, he said, had led to a “clarification of positions today in France.”
The mayor questioned the very Republic that once inspired him. He had believed that “the people who embody the Republic will come, the government will eventually express its solidarity with me.”
“Stunned,” he said, “I find that’s not the case.”
He declined his worried father’s request to resign.
“For a moment during the crisis, I told myself, well, if this is the Republic, I’m abandoning the Republic, just as it’s abandoned me,” Mr. Rabeh said. “But the truth is they’re not the Republic. The kids of Trappes are the Republic.”
BELFAST, Northern Ireland — The pandemic was hard on David Milliken, who sells drums, flags and pro-British banners from his brightly-colored shop in Sandy Row, a loyalist stronghold in Belfast. But now, he said, “things have started to open up again,” especially since “the unrest is back.”
Two months ago, Sandy Row exploded in flames as masked demonstrators hurled stones and gasoline bombs at the police to protest what they call the “Brexit betrayal.” With the loyalist marching season kicking off next month, there are fears that the eruption of violence was only a warm-up act.
Like others in Sandy Row, Mr. Milliken, 49, said he did not want a return to the Troubles, the bloody 30-year guerrilla war between Catholic nationalists, seeking unification with the Republic of Ireland, and predominantly Protestant loyalists and unionists, who want to stay in the United Kingdom.
iconic military victory over a Catholic king, James II, in 1690.
the 1998 Good Friday Agreement, which ended decades of sectarian strife, in part by tamping down Northern Ireland’s identity politics. Brexit has reawakened those passions, and they could flare further next year if, as polls currently suggest, the main Irish nationalist party, Sinn Fein, becomes the biggest party in a field of divided, demoralized unionists.
the Northern Ireland Protocol, a post-Brexit legal construct that has left the North awkwardly straddling the trading systems of Britain and the European Union. The protocol grew out of a deal between London and Brussels to avoid resurrecting a hard border between Northern Ireland and the Republic of Ireland. The catch is, it requires checks on goods flowing between the North and the rest of the United Kingdom, which carries both a commercial and psychological cost.
“It has hit the community here like a ton of bricks that this is a separation of Northern Ireland from the rest of the United Kingdom,” said David Campbell, chairman of the Loyalist Communities Council, which represents paramilitary groups that some say are stirring up unrest.
Mr. Campbell said that the paramilitaries actually tried to keep people off the streets. But he warned that unless the protocol was either scrapped or radically rewritten, violence would break out again during the marching season.
bitter divorce with the European Union.
Jonathan Powell, a former chief of staff to Tony Blair, the British prime minister at the time of the Good Friday Agreement, acknowledged that, “Biden could be important on the protocol.”
“Britain is rather friendless outside the E.U., so there is a limit to how far they can go against what the administration wants,” Mr. Powell added.
Until now, Mr. Johnson has taken a hard line in negotiations over the protocol. His senior aide, David Frost, says it is up to the European Union to propose remedies to the disruptions of the border checks. If it does not, Britain could abandon the protocol — a move the European Union says would breach the withdrawal agreement, though the bloc’s officials briefly threatened to scrap the protocol themselves in January.
the Democratic Unionists, a Northern Irish party that supported Brexit and has now fallen into disarray because of the fierce blowback from Mr. Johnson’s deal.
The party recently deposed its leader, Arlene Foster, and is squabbling over how to prepare for elections to the Northern Irish Assembly in May 2022. That has opened the door to something once thought inconceivable: that Sinn Fein could emerge as the largest party, with the right to appoint the first minister.
With Sinn Fein’s vestigial links to the paramilitary Irish Republican Army and bedrock commitment to Irish unification, an Assembly led by the party could prove far more destabilizing to Northern Ireland’s delicate power-sharing arrangements than the post-Brexit trading rules, which are difficult to explain, let alone use as a rallying cry.
But Sinn Fein’s leaders say that, with a growing Catholic population and the fallout from Brexit, momentum is on their side. The unionist parties supported Brexit, while they opposed it. They view the campaign against the protocol as a futile effort that only lays bare the costs of leaving the European Union.
“You have a very stark choice,” Michelle O’Neill, the party’s leader and the deputy first minister of Northern Ireland, said in an interview. “Do you want to be part of inward-looking Brexit Britain or outward-looking inclusive Ireland?”
Another question is how the authorities will deal with further unrest. In April, the police moved carefully against the rock-throwing crowds, treating them as a local disturbance rather than a national security threat. But if the violence escalates, that could change.
Monica McWilliams, an academic and former politician who was involved in the 1998 peace negotiations, said, “Loyalist threats, or violent actions, against a border down the Irish Sea may no longer be seen as a domestic problem.”
But the greater challenge, she said, is reassuring unionists and loyalists at a time when politics and demographics are moving so clearly against them. While there is little appetite in the Irish Republic for a near-term referendum on unification, Sinn Fein is within striking distance of being in power on both sides of the border — a development that would put unification squarely on the agenda.
In Sandy Row, the sense of a community in retreat was palpable.
Paul McCann, 46, a shopkeeper and lifelong resident, noted how real-estate developers were buying up blocks on the edge of the neighborhood to build hotels and upscale apartments. The city, he said, wants to demolish the Boyne Bridge — a predecessor of which William of Orange is said to have crossed on his way to that fateful battle with James II — to create a transportation hub.
“They’re trying to whitewash our history,” Mr. McCann said. “They’re making our loyalist communities smaller and smaller.”
For Gordon Johnston, a 28-year-old community organizer, it’s a matter of fairness: loyalists accepted the argument that reimposing a hard border between the north and south of Ireland could provoke violence. The same principle should apply to Northern Ireland and the rest of the United Kingdom.
“You can’t have it both ways,” he said. “You either have no borders or you have violence in the streets.”
SAN ANTONIO HUISTA, Guatemala — An American contractor went to a small town in the Guatemalan mountains with an ambitious goal: to ignite the local economy, and hopefully even persuade people not to migrate north to the United States.
Half an hour into his meeting with coffee growers, the contractor excitedly revealed the tool he had brought to change their lives: a pamphlet inviting the farmers to download an app to check coffee prices and “be a part of modern agriculture.”
Pedro Aguilar, a coffee farmer who hadn’t asked for the training and didn’t see how it would keep anyone from heading for the border, looked confused. Eyeing the U.S. government logo on the pamphlet, he began waving it around, asking if anyone had a phone number to call the Americans “and tell them what our needs really are.”
soared in 2019 and is on the upswing once more.
have risen, malnutrition has become a national crisis, corruption is unbridled and the country is sending more unaccompanied children to the United States than anywhere else in the world.
That is the stark reality facing Ms. Harris as she assumes responsibility for expanding the same kind of aid programs that have struggled to stem migration in the past. It is a challenge that initially frustrated her top political aides, some of whom viewed the assignment from Mr. Biden as one that would inevitably set her up for failure in the first months of her tenure.
Her allies worried that she would be expected to solve the entire immigration crisis, irked that the early reports of her new duties appeared to hold her responsible for juggling the recent surge of children crossing the border without adults.
linked to drug traffickers and accused of embezzling American aid money, the leader of El Salvador has been denounced for trampling democratic norms and the government of Guatemala has been criticized for persecuting officials fighting corruption.
Even so, Ms. Harris and her advisers have warmed to the task, according to several people familiar with her thinking in the White House. They say it will give her a chance to dive squarely into foreign policy and prove that she can pass the commander-in-chief test, negotiating with world leaders on a global stage to confront one of America’s most intractable issues.
critics denounced as unlawful and inhumane. Moreover, members of the current administration contend that Mr. Trump’s decision to freeze a portion of the aid to the region in 2019 ended up blunting the impact of the work being done to improve conditions there.
But experts say the reasons that years of aid have not curbed migration run far deeper than that. In particular, they note that much of the money is handed over to American companies, which swallow a lot of it for salaries, expenses and profits, often before any services are delivered.
Record numbers of Central American children and families were crossing, fleeing gang violence and widespread hunger.
independent studies have found.
“All activities funded with U.S.A.I.D.’s foreign assistance benefit countries and people overseas, even if managed through agreements with U.S.-based organizations,” said Mileydi Guilarte, a deputy assistant administrator at U.S.A.I.D. working on Latin America funding.
But the government’s own assessments don’t always agree. After evaluating five years of aid spending in Central America, the Government Accountability Office rendered a blunt assessment in 2019: “Limited information is available about how U.S. assistance improved prosperity, governance, and security.”
One U.S.A.I.D. evaluation of programs intended to help Guatemalan farmers found that from 2006 to 2011, incomes rose less in the places that benefited from U.S. aid than in similar areas where there was no intervention.
Mexico has pushed for a more radical approach, urging the United States to give cash directly to Central Americans affected by two brutal hurricanes last year. But there’s also a clear possibility — that some may simply use the money to pay a smuggler for the trip across the border.
The farmers of San Antonio Huista say they know quite well what will keep their children from migrating. Right now, the vast majority of people here make their money by selling green, unprocessed coffee beans to a few giant Guatemalan companies. This is a fine way to put food on the table — assuming the weather cooperates — but it doesn’t offer much more than subsistence living.
Farmers here have long dreamed of escaping that cycle by roasting their own coffee and selling brown beans in bags to American businesses and consumers, which brings in more money.
“Instead of sending my brother, my father, my son to the United States, why not send my coffee there, and get paid in dollars?” said Esteban Lara, the leader of a local coffee cooperative.
But when they begged a U.S. government program for funding to help develop such a business, Ms. Monzón said, they were told “the money is not designed to be invested in projects like that.”
These days, groups of her neighbors are leaving for the United States every month or two. So many workers have abandoned this town that farmers are scrambling to find laborers to harvest their coffee.
One of Ms. Monzón’s oldest employees, Javier López Pérez, left with his 14-year-old son in 2019, during the last big wave of Central American migration to the United States. Mr. López said he was scaling the border wall with his son when he fell and broke his ankle.
“My son screamed, ‘Papi, no!’ and I said to him, ‘Keep going, my son,’” Mr. López said. He said his son made it to the United States, while he returned to San Antonio Huista alone.
His family was then kicked out of their home, which Mr. López had given as collateral to the person who smuggled him to the border. The house they moved into was destroyed by the two hurricanes that hit Guatemala late last year.
Ms. Monzón put Mr. López in one of her relatives’ houses, then got the community to cobble together money to pay for enough cinder blocks to build the family a place to live.
While mixing cement to bind the blocks together, one of Mr. López’s sons, Vidal, 19, confessed that he had been talking to a smuggler about making the same journey that felled his father, who was realistic at the prospect.
“I told him, ‘Son, we suffered hunger and thirst along the way, and then look at what happened to me, look at what I lost,’” Mr. López said, touching his still-mangled ankle. “But I can’t tell him what to do with his life — he’s a man now.”
LONDON — The top economic officials from the world’s advanced economies reached a breakthrough on Saturday in their yearslong efforts to overhaul international tax laws, unveiling a broad agreement that aims to stop large multinational companies from seeking out tax havens and force them to pay more of their income to governments.
Finance leaders from the Group of 7 countries agreed to back a new global minimum tax rate of at least 15 percent that companies would have to pay regardless of where they locate their headquarters.
The agreement would also impose an additional tax on some of the largest multinational companies, potentially forcing technology giants like Amazon, Facebook and Google as well as other big global businesses to pay taxes to countries based on where their goods or services are sold, regardless of whether they have a physical presence in that nation.
Officials described the pact as a historic agreement that could reshape global commerce and solidify public finances that have been eroded after more than a year of combating the coronavirus pandemic. The deal comes after several years of fraught negotiations and, if enacted, would reverse a race to the bottom on international tax rates. It would also put to rest a fight between the United States and Europe over how to tax big technology companies.
has been particularly eager to reach an agreement because a global minimum tax is closely tied to its plans to raise the corporate tax rate in the United States to 28 percent from 21 percent to help pay for the president’s infrastructure proposal.
EU Tax Observatory estimated that a 15 percent minimum tax would yield an additional 48 billion euros, or $58 billion, a year. The Biden administration projected in its budget last month that the new global minimum tax system could help bring in $500 billion in tax revenue over a decade to the United States.
The plan could face resistance from large corporations and the world’s biggest companies were absorbing the development on Saturday.
“We strongly support the work being done to update international tax rules,” said José Castañeda, a Google spokesman. “We hope countries continue to work together to ensure a balanced and durable agreement will be finalized soon.”
said this month that it was prepared to move forward with tariffs on about $2.1 billion worth of goods from Austria, Britain, India, Italy, Spain and Turkey in retaliation for their digital taxes. However, it is keeping them on hold while the tax negotiations unfold.
Finishing such a large agreement by the end of the year could be overly optimistic given the number of moving parts and countries involved.
“A detailed agreement on something of this complexity in a few months would just be lighting speed,” said Nathan Sheets, a former Treasury Department under secretary for international affairs in the Obama administration.
The biggest obstacle to getting a deal finished could come from the United States. The Biden administration must win approval from a narrowly divided Congress to make changes to the tax code and Republicans have shown resistance to Mr. Biden’s plans. American businesses will bear the brunt of the new taxes and Republican lawmakers have argued that the White House is ceding tax authority to foreign countries.
Representative Kevin Brady of Texas, the top Republican on the House Ways and Means Committee, said on Friday that he did not believe that a 15 percent global minimum tax would curb offshoring.
“If the American corporate tax rate is 28 percent, and the global tax rate is merely half of that, you can guarantee we’ll see a second wave of U.S. investment research manufacturing hit overseas, that’s not what we want,” Mr. Brady said.
At the news conference, Ms. Yellen noted that top Democrats in the House and Senate had expressed support for the tax changes that the Biden administration was trying to make.
BAGHDAD — The United States is grappling with a rapidly evolving threat from Iranian proxies in Iraq after militia forces specialized in operating more sophisticated weaponry, including armed drones, have hit some of the most sensitive American targets in attacks that evaded U.S. defenses.
At least three times in the past two months, those militias have used small, explosive-laden drones that divebomb and crash into their targets in late-night attacks on Iraqi bases — including those used by the C.I.A. and U.S. Special Operations units, according to American officials.
Gen. Kenneth F. McKenzie Jr., the top American commander in the Middle East, said last month that the drones pose a serious threat and that the military was rushing to devise ways to combat them.
Iran — weakened by years of harsh economic sanctions — is using its proxy militias in Iraq to step up pressure on the United States and other world powers to negotiate an easing of those sanctions as part of a revival of the 2015 nuclear deal. Iraqi and American officials say Iran has designed the drone attacks to minimize casualties that could prompt U.S. retaliation.
a Defense Intelligence Agency assessment published in April. In the last year, a proliferation of previously unknown armed groups have emerged, some claiming responsibility for rocket attacks on U.S. targets.
thousands of American military contractors operate.
MQ-9 Reaper drones and contractor-operated turboprop surveillance aircraft are stationed in an attempt to disrupt or cripple the U.S. reconnaissance capability critical to monitoring threats in Iraq.
The United States has used Reapers for its most sensitive strikes, including the killing of Iran’s top security and intelligence commander, Maj. Gen. Qassim Suleimani, and Abu Mahdi al-Muhandis, a senior Iraqi government official and a leader of Iraq’s militia groups, in Baghdad in January 2020.
While the United States has installed defenses to counter rocket, artillery and mortar systems at installations in Iraq, the armed drones fly too low to be detected by those defenses, officials said.
Shortly before midnight on April 14, a drone strike targeted a C.I.A. hangar inside the airport complex in the northern Iraqi city of Erbil, according to three American officials familiar with the matter.
No one was reported hurt in the attack, but it alarmed Pentagon and White House officials because of the covert nature of the facility and the sophistication of the strike, details of which were previously reported by The Washington Post.
talks between them in Baghdad in April, the Saudis demanded that Iran stop those attacks, according to Iraqi officials.
While visiting northeastern Syria last month, General McKenzie, the top American commander for the region, said military officials were developing ways to disrupt or disable communications between the drones and their operators, bolster radar sensors to identify approaching threats more rapidly, and find effective ways to down the aircraft.
In each of the known attacks in Iraq, at least some of the drones’ remnants have been partially recovered, and preliminary analyses indicated they were made in Iran or used technology provided by Iran, according to the three American officials familiar with the incidents.
These drones are larger than the commercially available quadcopters — small helicopters with four rotors — that the Islamic State used in the battle of Mosul, but smaller than the MQ-9 Reapers, which have a 66-foot wingspan. Military analysts say they carry between 10 and 60 pounds of explosives.
Iraqi officials and U.S. analysts say that while cash-strapped Iran has reduced funding for major Iraqi militias, it has invested in splitting off smaller, more specialized proxies still operating within the larger militias but not under their direct command.
American officials say that these specialized units are likely to have been entrusted with the politically delicate mission of carrying out the new drone strikes.
Iraqi security commanders say groups with new names are fronts for the traditional, powerful Iran-backed militias in Iraq such as Kataib Hezbollah and Asaib Ahl al-Haq. Iraqi officials say Iran has used the new groups to try to camouflage, in discussions with the Iraqi government, its responsibility for strikes targeting U.S. interests, which often end up killing Iraqis.
The Iraqi security official said members of the smaller, specialized groups were being trained at Iraqi bases and in Lebanon as well as in Iran by the hard-line Islamic Revolutionary Guards Corps — which oversees proxy militias in the Middle East.
American and Iraqi officials and analysts trace the increased unpredictability of militia operations in Iraq to the U.S. killing of General Suleimani and the Iraqi militia leader.
“Because the Iranian control over its militias has fragmented after the killing of Qassim Suleimani and Abu Mahdi Muhandis, the competition has increased among these groups,” said Mr. Malik, the Washington Institute analyst.
Jane Arraf reported from Baghdad and Eric Schmitt from Washington. Falih Hassan contributed reporting.
CARACAS, Venezuela — From within his presidential palace, President Nicolás Maduro regularly commandeers the airwaves, delivering speeches intended to project stability to his crumbling nation.
But as the Venezuelan state disintegrates under the weight of Mr. Maduro’s corrupt leadership and American sanctions, his government is losing control of segments of the country, even within his stronghold: the capital, Caracas.
Nowhere is his weakening grip on territory more evident than in Cota 905, a shantytown that clings to a steep mountainside overlooking the gilded halls from which Mr. Maduro addresses the nation.
policing, road maintenance, health care and public utilities, to pour dwindling resources into Caracas, home of the political, business and military elites who form his support base.
Hunkered down in his fortified Caracas residences, Mr. Maduro crushed the opposition, purged the security forces of dissent and enriched his cronies in an effort to eliminate challenges to his authoritarian rule.
In remote areas, swathes of national territory fell to criminals and insurgents. But gang control of Cota 905 and the surrounding shantytowns, which lie just two miles from the presidential palace, is evidence that his government is losing its grip even on the center of the capital.
Across the city, other armed groups have also asserted territorial control over working-class neighborhoods.
“Maduro is often seen as a traditional strongman controlling every aspect of Venezuelans’ lives,” said Rebecca Hanson, a sociologist at the University of Florida who studies violence in Venezuela. “In reality, the state has become very fragmented, very chaotic and in many areas very weak.”
As the government’s reach in Caracas’s shantytowns withered, organized crime grew, forcing Mr. Maduro’s officials to negotiate with the largest gangs to limit violence and maintain political control, according to interviews with a dozen residents, as well as police officers, officials and academics studying violence.
In the process, the most organized gangs began supplanting the state in their communities, taking over policing, social services and even the enforcement of pandemic measures.
Police officers say the gang that controls Cota 905 now has around 400 men armed with the proceeds from drug trafficking, kidnapping and extortion, and that it exerts complete control over at least eight square miles in the heart of the capital.
Gang members with automatic weapons openly patrol the shantytown’s streets and those of the surrounding communities, and guard entry points from rooftop watchtowers. The first checkpoint appears just a few minutes’ drive from the headquarters of Mr. Maduro’s secret police.
As the Venezuelan economy went into a tailspin, the Cota gang began offering financial support to the community, supplanting Mr. Maduro’s bankrupt social programs, which once offered free food, housing and school supplies for the poor.
After monopolizing the local drug trade, the Cota 905 gang imposed strict rules on the residents in return for stopping the once endemic violence and petty crime. And many residents welcome its hard line on crime.
“Before, the thugs robbed,” said Mr. Ojeda, a Cota 905 resident who, like others in the community, asked that his full name not be published for fear of crossing the gangsters. “Now, they are the ones who come to you, without fail, with anything that goes missing.”
During his tenure, Mr. Maduro has veered from brutal suppression of organized crime groups to accommodation in an attempt to check rising crime.
In 2013, he withdrew security forces from about a dozen troubled spots, including Cota 905, naming them “Peace Zones,” as he tried to placate the gangs. Two years later, when the policy failed to check crime, he unleashed a wave of brutal police assaults on the shantytowns.
The police operations resulted in thousands of extrajudicial killings, according to the United Nations, earning Mr. Maduro charges of committing crimes against humanity and the hatred of many shantytown residents. Faced with the onslaught, the gangs closed ranks, creating ever larger and more complex organizations, according to Ms. Hanson and her colleague, the researcher Verónica Zubillaga.
Unable to defeat the Cota gang, Mr. Maduro’s government returned to negotiations with its leaders, according to a police commander and two government officials who held talks with the gang and worked to put the agreements in place.
Security forces are once again banned from entering the community, according to the police commander, who is not authorized to discuss state policy and did so on condition of anonymity.
Under the deal with the government, the Cota gang has reduced kidnappings and murders, and began carrying out some state policies. During the pandemic, gang members strictly enforced lockdown rules and mask wearing, local residents said. And the gang is working with the government to distribute the scant remaining food and school supplies to the residents, residents and the two officials said.
“The gang is focused on the community,” said Antonio Garcia, a shantytown resident. “They make sure we get our bag of food.”
Mr. Ojeda said he received $300 from the gang the last Carnival season to buy toys and sweets for his family, a fortune in a country where the minimum monthly wage has collapsed to about $2. Residents said young people in the community are offered jobs as lookouts or safe house guards for between $50 and $100 a week, more than most doctors and engineers make in Venezuela.
Taking these jobs is easier than leaving them. Soon after the oldest son of Ms. Ramírez — who did not want to give her full name out of fear of the gang — began serving as a lookout in Cota 905, he discovered that his life now belonged to the gang.
“He had new clothes, new shoes, but he couldn’t stop crying,” Ms. Ramírez said. “He wanted to go back and couldn’t.”
Anti-government protests are banned in the shantytown, and gang members summon residents to the polling stations on elections, said the residents.
The members “tell us that if the government is toppled, we would be affected too, because the police would return,” said Ana Castro, a Cota resident. “The ‘Peace Zone’ would end, and we would all suffer.”
In private, some government officials defend the nonaggression pacts with the biggest gangs, saying the policy has drastically reduced violence.
Violent deaths in Caracas shantytowns have halved since the mid-2010s, when the Venezuelan capital was one of the world’s deadliest cities, according to figures from a local nonprofit, Mi Convive.
But academics and analysts studying crime in the city say the drop in homicides points to the growing power of Caracas’s gangs against an increasingly weak government. The imbalance, experts said, puts the government and the population in an increasingly dangerous and vulnerable position.
The power shift was evident in April, when the Cota gang shot up a police patrol car and took over a section of highway running through Caracas. The area was a five-minute drive from the presidential palace, and the blockade paralyzed the capital for several hours.
But the government stayed silent through it all. The security forces never came to retake the highway. Once the gang left, officers quietly cleared out the blasted patrol car.
The music should be pumping and the burgers and jerk chicken wings flying out of the kitchen this holiday weekend at the Rambler Kitchen and Tap in the North Center neighborhood of Chicago.
To wash it down, patrons might go with a mixed drink or one of the 20 craft beers the bar sells. But many will order a hard seltzer. The Rambler expects to sell close to 500 cans in flavors like peach, pineapple and grapefruit pomelo.
“We’ll sell a lot of buckets of White Claw and Truly seltzers,” said Sam Stone, a co-owner of the Rambler. “It’s going to be a big summer for hard seltzer.”
The Memorial Day weekend kicks off what many hope will be a more normal summer, when kids start counting down the number of days left in school, people head back to the beach and grills heat up for backyard parties that went poof last year because of the pandemic. And for the hard seltzer industry, it’s the start of a dizzying period when dozens of old and new competitors vie to be the boozy, bubbly drink of the season.
ad campaign with the British pop singer Dua Lipa. This spring, the hip-hop star Travis Scott released Cacti, a seltzer made with blue agave syrup, in a partnership with Anheuser-Busch. It quickly sold out in many locations.
“People were lining up outside of the stores to buy Cacti and share pictures of themselves with their carts full of Cacti,” said Marcel Marcondes, the chief marketing officer for Anheuser-Busch.
Also this spring, Topo Chico Hard Seltzer was released. A partnership between Coca-Cola and Molson Coors Beverage, it hit shelves in 16 markets across the country, chasing the cult following of Topo Chico’s seltzer water in the South.
“I feel like I can walk into a party saying, ‘Oh, yeah, I brought the Topo Chico,’” said Dane Cardiel, 32, who works in business development for a podcast company and lives in Esopus, N.Y., about 60 miles south of Albany.
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How flavored bubbly water with alcohol became a national phenomenon is partly due to social media videos that went viral and clever marketing that sold hard seltzers as a “healthier” alcohol choice.
White Claw’s slim cans prominently state that the drinks contain only 100 calories, are gluten free and have only two grams each of carbohydrates and sugar. The brand is owned by the Canadian billionaire Anthony von Mandl, who created Mike’s Hard Lemonade.
“The health and wellness element is front and center in terms of the visual marketing,” said Vivien Azer, an analyst at the Cowen investment firm. “Every brand’s packaging features its relatively low carb and sugar data.”
On top of that, the alcohol content in most hard seltzers, about 5 percent, or the same as 12 ounces of a typical beer, is less than a glass of wine or a mixed drink. That makes it easier for people to sip at a party or while watching a game without getting intoxicated or winding up with the belly-full-of-beer feeling.
“It’s a nice drink for an afternoon on the patio,” said Shelley Majeres, the general manager of Blake Street Tavern in downtown Denver. “You can drink four or five of them in an afternoon and not have a big hangover or get really drunk.”
Blake Street, an 18,000-square-foot sports bar, started selling hard seltzers two years ago. Today, they make up about 20 percent of its can and bottle sales.
The industry has also neatly sidestepped the gender issue that plagued earlier, lighter alcoholic alternatives like Zima, which became popular with women but struggled to be adopted by men.
“I’ve got just as many men as women drinking it,” said Nick Zeto, the owner of Boston Beer Garden in Naples, Fla. “And it started with the millennials, but now I have people in their 40s, 50s and 60s ordering it.”
That kind of broad appeal is attractive to beer, wine and spirits companies.
“We view ourselves as the challenger brand,” said Michelle St. Jacques, the chief marketing officer of Molson Coors, which has been making beer since the late 1700s but hopes to end this year with 10 percent of the hard seltzer market.
Last spring, the company released Vizzy, a hard seltzer that contains vitamin C. Top Chico came this spring. “We feel like we’re making great progress in seltzer by not trying to bring me-too products, but rather products and brands that have a clear difference,” Ms. St. Jacques said.
While grocery and liquor stores have made plenty of space available to the hard seltzer brands that people drink at home, the competition to get into restaurants and bars is fierce. Most want to offer only two or three brands to their customers.
“Oh, my god, I get presented with new hard seltzer whenever they can get my attention,” said Mr. Stone, who sells six brands at the Rambler. The crowd favorite, he said, is the vodka-based High Noon Sun Sips peach, made by E.&J. Gallo Winery. “Everybody, from the big brands to small, new ones, are getting into the hard seltzer game.”