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CIA Chief William Burns called to reassure Kremlin after Wagner mutiny: Russia’s spy boss was told the US had no role in the uprising. WSJ
+ Burns’s phone call with Sergei Naryshkin, the head of Russia’s foreign-intelligence service, is believed to be the highest-level contact between the two governments since the attempted mutiny.
+ The outreach by Burns, a former diplomat often tapped to convey sensitive messages to Russia and other nations, is part of a wider White House strategy to signal to Putin and his inner circle that the US had no role in Prigozhin’s move and isn’t seeking to stoke tensions in Russia.
+ The message from the chief of the Central Intelligence Agency was: “The US wasn’t involved. This is an internal Russian matter,” one official said.
+ US Ambassador to Russia Lynne Tracy relayed the message to Russian officials in Moscow on Saturday, the State Department said.
What’s next for Russia: The Wagner rebellion that briefly sent tanks toward Moscow exposed damaging rifts within the regime, and the turmoil isn’t over. How a weakened Putin responds has huge stakes for Ukraine and the US. WSJ
West to Putin: We hate you. Don’t go. The reactions to a warlord’s aborted mutiny showed how countries value Russia’s internal stability above a disorderly fall of its strongman leader. Politico
FT: Putin seeks to show Russian elite he is ‘strong emperor’
Putin thinks he’s still in control. He’s not. Mikhail Zygar
Z Generation — Russia’s brainwashed youth: Historian Ian Garner offers a disturbing account of how Putin’s ‘cleansing war’ has enhanced his fascist project. FT
Ukraine aims for comeback in shattered Bakhmut after Wagner revolt: Russian forces took ten months to seize the city, and now Kyiv aims to strike a demoralizing blow after Prigozhin turned on Moscow. WSJ
Ukraine’s top general, Valery Zaluzhny, wants shells, planes and patience WP
+ For Ukraine’s counteroffensive to progress faster, Gen. Valery Zaluzhny, the top officer in Ukraine’s armed forces, says he needs more — of every weapon.
+ Zaluzhny expressed frustration that while his biggest Western backers would never launch an offensive without air superiority, Ukraine still has not received modern fighter jets but is expected to rapidly take back territory from the occupying Russians. American-made F-16s, promised only recently, are not likely to arrive until the fall — in a best-case scenario.
+ Zaluzhny also pointed to NATO forces’ own doctrine — which parallels Russia’s, he said — that calls for air superiority before launching ground-based deep-reaching operations.
Curbing reliance on China needs an army of workers: $1 million of subsidies per giga-factory job says a lot about where the most urgent manufacturing shortage lies. Lionel Laurent
Reuters: Xi Jinping to attend, deliver speech at SCO summit via video link, China's foreign ministry says
Can China’s charm offensive with business ease US tensions? At this week’s ‘Summer Davos’ summit, officials tried to dispel thoughts of ‘decoupling.’ But geopolitical friction was never far away. FT
+ At a summit in Tianjin this week, the Chinese premier Li Qiang took the opportunity to make the foreign executives in attendance feel welcome.
+ Li, seen as the most business friendly member of President Xi Jinping’s inner circle, wrapped up a talk at the World Economic Forum’s New Champions meeting with a play on words in Chinese — mixing the word “laowai”, which means foreigner, with the term “laoxiang”, which means “townspeople.”
+ Li’s charm offensive at the meeting — nicknamed the “Summer Davos,” in reference to the far larger WEF event held in Switzerland in January — was intended to make attendees from overseas abandon all thoughts of “decoupling” and “de-risking.”
+ Inside China, anxiety is running deep. “This is the first time in 40 years that the Chinese public are not sure if things are going to get better,” says one Chinese commentator on the economy, who did not want to be named.
+ “This is my first time in China. I thought I should be a little bit nervous,” says JD LaRock, president of the Network for Teaching Entrepreneurship, a New York-based non-profit organisation.
+ Frank Bournois, dean of China-Europe International Business School (CEIBS), which has campuses in several large Chinese cities, praises the “spirit of entrepreneurship” at the event.
+ The property sector, a growth engine of the economy, is locked in a long slump. After steadying briefly this year, it began to slip again in recent months, threatening consumer confidence. China’s exports and manufacturing sectors are also struggling.
+ Some believe there is a risk of a “balance sheet recession”, when the indebted focus on paying down debt, as happened in Japan in the 1990s after its bubble burst.
+ “I think some of the challenges the Chinese are facing are equal to or perhaps more challenging than the Japanese faced 30-something years ago,” says Richard Koo, chief economist at the Nomura Research Institute, who coined the term.
+ He says the only way to fix a balance sheet recession is a very large fiscal response. The government needs to borrow the money that individuals and corporates are saving and recirculate it in the economy, Koo says, otherwise GDP will contract.
+ Few are expecting anything at the scale of the $570bn fiscal rescue package China unleashed in 2008. The Chinese economy is working through important structural changes that will take time, said economist Zhu Min at a WEF panel on the country’s rebound.
BBC: China tightens Xi Jinping's powers against the West with new law
New Chinese law raises risks for American firms in China, US officials say: US counterintelligence officials say revised Chinese law potentially turns normal business activities into espionage. WSJ
+ A bulletin issued Friday by the National Counterintelligence and Security Center warns that the revised law is vague about what constitutes espionage and gives the government greater access to and control over companies’ data, potentially turning what would be considered normal business activities into criminal acts.
+ The amended counterespionage law, which takes effect Saturday, has unsettled foreign businesses in China. The publication of those revisions this spring came amid a wave of raids, inspections and other acts by Chinese authorities against foreign, chiefly American businesses, as tense U.S.-China relations deteriorated further.
+ The revised law expands the definition of espionage without defining terms in a way that is “deeply problematic for private sector companies,” said Mirriam-Grace MacIntyre, who leads the counterintelligence center.
US spies issue warnings over risks of doing business in China Bloomberg
+ A bulletin issued by the National Counterintelligence and Security Center on Friday warns executives that an update to China’s counterespionage law, which comes into effect on July 1, has the “potential to create legal risks or uncertainty” for companies doing business in China.
+ It adds that the law broadens the scope of China’s espionage law and expands Beijing’s official definition of espionage. “Any documents, data, materials, or items” could be considered relevant to the law due to its “ambiguities,” the bulletin says.
+ The revisions to China’s counterespionage law have raised further concerns for US companies, which already find themselves in caught in the middle of an increasingly fraught US-China relationship. The law is just one of a slew of measures taken by Xi Jinping to strengthen state power and clamp down on foreign influence.
Pentagon to filmmakers: We won’t help you if you kowtow To China: DOD will no longer work with directors if their movie will be censored by Beijing. Politico
+ If you’re a filmmaker and you want the Pentagon’s help, from now on you’ll have to guarantee that you won’t let China censor your movie first.
+ On Wednesday, the Defense Department updated its rules for working with movie studios to prohibit any assistance to directors who plan to comply or will likely comply with censorship demands from the Chinese government in order to distribute their movie there.
Nikkei: Netherlands unveils chip tool export curbs in fresh blow to China
Reuters: Companies rather than countries must de-risk relations with China, Scholz says
EU softens China strategy by adopting ‘de-risking’ approach: Decision agreed quickly at Brussels summit of leaders as bloc highlights the vulnerability of supply chains. Guardian
+ EU leaders have launched a policy towards China of “de-risking”, a softening of its unofficial “decoupling” approach that reflects concerns over the economic damage of cutting off the world’s second-biggest economy or trade wars.
+ “The EU will continue to reduce critical dependencies and vulnerabilities, including the supply chain and will de-risk and diversify where necessary and appropriate,” the commission said in a formal policy position adopted by the bloc. “The EU does not intend to decouple or to turn inwards.”
+ The EU’s six-paragraph text on China is designed to protect its own economic interests but at the same time give it a wide berth on diplomatic issues.
+ “Diplomatic derisking is also important because we want to keep open communication lines with China on issues where we agree”
+ The bloc will pursue new barriers including guards against what one diplomat called “technological leakage” and reducing dependency on materials for products, including electric vehicles.
+ The position is considerably softer than that of the US, which is itself trying to repair relations with Beijing.
South Korea turns up heat on Kim Jong Un with hawkish pointman: Bloomberg reports South Korean President Yoon Suk Yeol on Thursday appointed political science professor Kim Yung-ho as the head of the Unification Ministry. This steps up an assertive approach to North Korea that includes tit-for-tat responses to military provocations, closer cooperation with its sworn enemies, the US and Japan, and condemning Pyongyang’s record on human rights.
Le Monde: More police, armored vehicles will be deployed to contain riots in France
FT: French riots plunge Macron into fresh crisis
+ @NewsHour: French President Emmanuel Macron is urging parents to keep teenagers at home to quell rioting spreading across France and says social media are fueling copycat violence.
Europe swings right — and reshapes the EU: Italy, Finland, Greece have recently moved. Spain could be next. The shift will affect everything from climate policy to migration. Politico
+ Across Europe, governments are shifting right. In some places, far-right leaders are taking power. In others, more traditional center-right parties are allying with the right-wing fringes once considered untouchable.
+ And with the EU set to elect a new European Parliament next year, the rightward drift could also produce a more conservative Brussels for years to come — a period that will feature critical decisions on things like expanding the EU eastward, trading with China and policing the rule of law in EU countries.
+ A strong conservative showing may also turn the farther-right European Conservatives and Reformists (ECR) group — featuring Meloni and Poland’s nationalist Law and Justice party — into kingmakers, with centrist and center-right lawmakers courting its votes to push their agenda.
Cuban boy castaway Elián González becomes a lawmaker: AP reports now 29, González is stepping into Cuban politics. He recently entered his country’s congress with hopes of helping his people at a time of record emigration and heightened tension between the two seaside neighbors.
The man who pictured Ghana’s rise at home and abroad: James Barnor, Ghana’s first photojournalist and an influential fashion photographer in London, stars in a major survey at the Detroit Institute of Arts. NYT
+ The exhibition’s more than 170 pictures chronicle Barnor’s crucial role representing an emerging nation and its people’s sense of self. He became Ghana’s first photojournalist in the 1950s, according to historians. He worked in London in the swinging ’60s, capturing the fashion and lives of Ghanaian expats and celebrities. In 1969, he returned to Accra to set up what is considered the country’s first color photography lab. (He returned to London permanently in 1994.)
Court votes to bar Bolsonaro from running for office: WP reports Brazil’s top elections court voted Friday to bar Jair Bolsonaro from running for office for eight years — a period that covers the next presidential election — for making what members of the panel said were claims he knew to be false about the integrity of the country’s voting systems.
AP: Brazil court votes to bar Bolsonaro from elections until 2030
+ @PKurzin: #BREAKING: Brazils fmr President #Bolsonaro has been barred from politics for 8+ years. The Supreme Court voted 5-2 after he was found guilty of abusing his power as head of state.
UNESCO votes to readmit the United States: Le Monde reports in 2017, the Donald Trump administration withdrew the US from the United Nations' scientific, educational, and cultural organization, citing anti-Israel bias.
Biden administration failed to foresee Afghanistan mayhem, review finds WP
+ The State Department redacted large portions of the report, releasing 23 of its 87 pages, citing security concerns. The analysis focused primarily on actions and reforms inside the agency, rather than at the White House or the Pentagon, each of which already has produced accounts of the 20-year war’s calamitous final chapter.
+ The analysis takes aim at failings on multiple levels. At the top, officials gave “insufficient senior-level consideration of worst-case scenarios and how quickly those might follow” after Biden affirmed Trump’s decision to pull the U.S. military from Afghanistan.
+ Once the Taliban drew near Kabul and the United States began the full withdrawal, the Biden administration’s communications made the evacuation more chaotic and dangerous than it would have been otherwise, the report found.
+ “Constantly changing policy guidance and public messaging from Washington” about who was eligible to be relocated from Afghanistan “added to the confusion and often failed to take into account key facts on the ground,” it said.
+ There were lower-level problems, too. A June 2021 coronavirus breakout at the embassy led to a strict lockdown there, confining many personnel to their quarters in the bunkerlike facility, and making it harder to collaborate and receive classified briefings as the military pullout intensified, the report noted.
Plainly...
State Department report on Afghanistan exit urges ‘worst case’ thinking: NYT reports the department said it should better prepare for unexpectedly dire scenarios and ensure that a wide range of views are considered in its planning.
The military recruiting crisis: Even veterans don’t want their families to join: Pentagon scrambles to retain the main pipeline for new service members as disillusioned families steer young people away. WSJ
+ The US Army in 2022 had its toughest recruiting year since the advent of the all-volunteer military in 1973 and missed its goal by 25%. This year, it expects to end up about 15,000 short of its target of 65,000 recruits.
+ The Navy expects to fall short by as many as 10,000 of its goal of nearly 38,000 recruits this year, and the Air Force has said it is anticipating coming in at 3,000 below its goal of nearly 27,000. The Marine Corps met its target last year of sending 33,000 to boot camp, and expects to meet its goals this year, but its leaders described recruitment as challenging.
+ Only 9% of young people ages 16-21 said last year they would consider military service, down from 13% before the pandemic, according to Pentagon data.
+ Today, nearly 80% of all new Army recruits have a family member who has served in uniform, according to the service.
+ The Department of Defense said 77% of American youth are disqualified from military service due to a lack of physical fitness, low test scores, criminal records including drug use or other problems. In 2013, about 71% of youth were ineligible.
Win or lose, Chris Christie is running the best campaign against Trump: Not only is Chris Christie the only Republican who understands he is running against Trump, he’s the only candidate who comes close to matching him as an entertainer. Matt Lewis
Republican candidate Chris Christie: ‘Trump wants to be Putin in America’: The former New Jersey governor on his mission to stop the ex-president from returning to power. FT
+ “The majority of Republicans know two things,” says Christie. “One that Trump has proved himself too self-consumed to be an effective president, and two that he has been a failure politically. We keep losing. What I’m saying to them [fellow Republicans] is ‘stop whispering’. To me they’re literally whispering, even when it’s just the two of us talking. My point to all of them is, ‘It’s OK, he doesn’t have an army of his own, he’s not somebody to be afraid of.’”
+ Do you think Trump would be different as president a second time round, I interrupt. “Oh, he’d be much worse,” says Christie. “When he first got in, he was scared. He would bluster a lot, he didn’t know what government was like and didn’t know how to manoeuvre it. He would be a lot more of a problem as president this time. He’s about increasing his own power and lashing out at those people and institutions that he’s felt wronged by.”
Republican opposition to LGBTQ rights erupts in backlash to Pride Month: Throughout June, many Republicans, including presidential hopeful Ron DeSantis have sharply criticized Pride celebrations, and some have resurfaced fights over same-sex marriage. WP
+ Many conservative strategists and activists attribute the openly critical postures during Pride Month to a perception that the LGBTQ+ rights movement has gone too far, particularly with programming for children and public displays of Pride symbols.
+ As the Republican presidential primary has collided with Pride Month, some of the candidates have vocally opposed the celebrations and emphasized their opposition to expressions of LGBTQ+ identity.
MI-SEN: Former House Intelligence Chair Mike Rogers (R) “is seriously weighing a campaign for Michigan’s open Senate seat.
Supreme Court strikes down Biden’s student debt relief plan: Politico reports in a 6-3 decision, the court’s conservative majority ruled that Biden’s effort to erase roughly $400 billion of student debt was an illegal use of executive power.
AP: An inflation gauge tracked by the Federal Reserve falls to its lowest point in 2 years
CNBC: Apple’s market cap tops $3 trillion
+ Apple’s market cap topped $3 trillion on Friday, passing the $190.73 share price required to hit the milestone, according to CNBC’s most recent share count.
+ Apple was the first company to hit a $3 trillion market cap during intraday trading in January 2022, but it failed to close at that level. It has another shot to do that on Friday.
Goldman is looking for a way out of its partnership with Apple: WSJ reports American Express is in talks to take over Goldman’s card deal and other ventures with the tech giant.
Virgin Galactic finally flies its first commercial space tourism mission: WP reports the flight commissioned by the Italian government comes nearly 20 years after Richard Branson started the company.
Harvard fraud claims fuel doubts over science of behavior: Field that includes ‘nudge’ theory has gained broad traction within businesses, but some findings are contested. FT
+ “What I found was that almost anyone who had read Nudge had a licence to set up as a behavioural scientist,” said Nuala Walsh, who formed the Global Association of Applied Behavioural Scientists in 2020 to try to set some standards.
+ Advocates of behavioural science say recent controversies are exceptions and that the field can be a valuable corrective to unfounded forecasts about behaviour.
+ Katy Milkman, a professor at the Wharton School of business, said: “I’ve had more conversations in the last week about how we can make our science more robust and fraud-proof than I’d had in the past year. So I anticipate very positive side effects of these revelations for those of us who study nudging.”
We have a dopamine problem: The neurochemical has become a boogeyman for people worried about addiction and indulgence. But the real story is a lot more complex. NYT
+ “We’ve transformed the world from a place of scarcity to a place of overwhelming abundance,” Dr. Anna Lembke, a Stanford psychiatrist, wrote in her best-selling book “Dopamine Nation.” Consequently, we’re all at risk for “compulsive overconsumption.”
+ “It’s an important part of why we’re here today,” said Kent C. Berridge, a professor of psychology and neuroscience at the University of Michigan. “We wouldn’t have evolved and we wouldn’t have survived, our ancestors, without dopamine.”
+ Dopamine is also essential for learning. In this context, the key element that causes dopamine neurons to fire is surprise, regardless of whether the outcome is rewarding or disappointing.
+ Dr. Berridge put it, “dopamine is our friend, not just our enemy.”
Gutenberg’s lessons in the era of AI Azeem Azhar + Jeff Jarvis
Big Tech has a troubling stranglehold on artificial intelligence: Nvidia and Microsoft are reaping the profits of the AI boom, but their grip won’t last forever. Parmy Olson
+ GPUs — graphics processing units — are special chips that were originally designed to render graphics in video games, and have since become fundamental to the artificial intelligence arms race. They are expensive, scarce and mostly come from Nvidia Corp., whose market value breached $1 trillion last month because of the surging demand.
+ To build AI models, developers typically buy access to cloud servers from companies like Microsoft Corp. and Amazon.com Inc. — GPUs power those servers.
+ During a gold rush, sell shovels, goes the saying. It’s no surprise that today’s AI infrastructure providers are cashing in.
+ The price of building AI models is rising because purchasing a GPU today is like trying to buy toilet paper during the COVID-19 pandemic.
+ Nvidia’s A100 and H100 chips are the gold standard for machine-learning computations, but the price of H100s has climbed to $40,000 or more from less than $35,000 just a few months ago, and a global shortage means Nvidia can’t make the chips fast enough.
+ When Sam Altman traded 49% of OpenAI for Microsoft’s $1 billion investment in 2022, that seemed like a remarkable amount of equity to give up — until you consider that hitching to a major cloud vendor might be the safest way for AI companies to stay in business.
+ Makers of AI models, meanwhile, face a constant migration of talent between their companies, making it difficult to maintain secrecy and product differentiation.
+ And their costs are never-ending; once they’ve spent the money on cloud credits to train their models, they also have to run those models for their customers, a process known as inference.
+ AWS has estimated that inference accounts for up to 90% of total operational costs for AI models. Most of that money goes to cloud providers.
NYC Explorers Club used global reach for doomed Titan rescue Bloomberg
Are you a wine geek? It’s a trendy term, but what does true geekery entail? To find out, our wine columnist consulted sommeliers, oenophiles, and even an AI chatbot. Lettie Teague
Bloomberg: Taylor Swift is making more than $13 million a night on her tour
Guardian: Tour de France bolsters security amid fears of protests and civil unrest
+ Race director says of concerns: ‘We will adapt if needed’
+ Disruption expected after three nights of rioting across France
ESPN cutting on-air talent as it seeks additional cost savings: THR reports about 20 on-air personalities are expected to be cut Friday, including Jeff Van Gundy, Suzy Kolber, Max Kellerman, and Jalen Rose.
Guardian: Wimbledon bans its merchandise from being sold in Russia and Belarus
+ All England Club will not ship products to two countries
+ News comes after a ban on Russian and Belarusian players lifted
Vermont Green FC: The fourth-tier US soccer team out to save the world: The Burlington club in America’s fourth division is the only US sports team with climate justice as a driving principle, putting it at the vanguard of a burgeoning movement. Guardian
+ Unlike at other stadiums, the messages the team projects are overwhelmingly climate-centric. Throughout the evening, the PA system boomed with tips on how recycling can help fans reduce their carbon footprints and the benefits of riding a bike to the game.
+ The ads ringing the pitch hawked a solar installer, a green energy investment firm, and a company selling kelp-based nutritional products, among others.
+ Near the food stands there was a bin where fans could drop unwanted T-shirts that will be turned into new clothing – including the merchandise that the Green sells.
+ The team’s social justice and community initiatives feature prominently as well.
Soccer’s next big thing is buying in bulk: Networks of clubs help top teams streamline their scouting, methods, and player acquisition. But who do they really serve? Rory Smith
+ Over the last few years, the concept of building a stable of clubs has become de rigueur in soccer.
+ “multiclub” = Owning multiple teams across disparate leagues has become so commonplace that it is now a noun.
+ Owning a network of teams should allow owners to share best practices more easily while reducing risk and increasing efficiency in the transfer market.
+ A network should, if constructed correctly, function as a two-way talent pipeline: The best players rise to the top of the pyramid, while those who fall by the wayside have landing spots farther down, meaning there is far less waste.
+ The trend represents something significantly more troubling: not so much an inevitable conclusion to the sport’s flirtation with high finance but something far closer to an existential threat.
Enjoy the ride + plan accordingly.
-Marc
Marc A. Ross | Chief Communications Strategist @ Caracal
Caracal produces ITK Daily.
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