Financial Times Europe - 20.02.2020

Thursday20 February 2020 ★ FINANCIAL TIMES 3

I N T E R N AT I O N A L

C H R I ST I A N S H E P H E R D— BEIJING
K AT R I N A M A N S O N— WASHINGTON

China will expel threeWall Street Jour-
nal eporters in the coming days, mark-r
ing the first time in decades that the
country has cancelled the press cards of
multiple foreign reporters at the same
time.
Beijing said yesterday the move was in
retaliation for a comment piece head-
lined “China Is the Real Sick Man of
Asia” publishedon February 3, which
officials said “smears the efforts of the
Chinese government” in fighting the

coronavirus outbreak. The expulsions

come a day after the US designated five

Chinese media utlets as foreign diplo-o

matic missions, saying their journalists

operated as propaganda agents and

required greater monitoring.

Washington said it would require Xin-

hua, China’s official news agency, China

Radio International, China Global Tele-

vision Network and the distributors of

newspapers China Daily and People’s

Daily — China Daily Distribution Corpo-

ration and Hai Tian Development USA

— to register the names of US employ-

ees, declare any property holdings and

seek approval to add any more.

“The fact of the matter is each and

every one of these entities does work for

the Chinese government,” a senior US

state department officialsaid on Tues-

day, describing them as organs of a one-

party state propaganda apparatus that

“take their orders directly from the top”.

The decision will, in effect, treat the

five organisations as foreign embassies,

and US officialssaid they would not

restrict their work, reporting or access.

But it will not afford them diplomatic

immunity nor force them to reveal any

meetings with US officials or educa-

tional and research institutions.

A Chinese foreign ministry spokes-

man criticised thedecision, accusing

Washingtonof “wantonly restricting

and thwarting Chinese media outlets’

normal operations”. He addedthat Bei-

jing would “reserve the right to take fur-

ther measures in response”.

Two of theWall Street Journal staff ot

be expelled — deputy bureau chief Josh

Chin and reporter Chao Deng — are US

nationals, the paper said. The third,

Philip Wen, is Australian. All three have

reported on Beijing’s mass surveillance

policies and controversial detention of

Uighur Muslims in the region of Xin-

jiang. In August, China refused to renew

the accreditation of anotherWall Street

Journal reporter.

Beijing said the expulsions were pun-

ishment for a February 3 comment arti-

cle by Walter Russell Mead, a professor

at Bard College and a Wall Street Journal

columnist, who strongly criticised Chi-

nese authorities’ response to the coro-

navirus outbreak.

The article sparked an angry backlash

on Chinese social media, with national-

ist tabloids and liberal commentators

alike saying the author had crossed a

line by “insulting” China during a

period of national crisis. The newspaper

said its comment and news reporting

units operated in “strict separation”.

China’s leaders have frequently

tapped into nationalist sentiment in

recent years over perceived slights by

foreign nations, to justify harsh retalia-

tory measures.

But the Foreign Correspondents’ Club

of China saidit was the firstexpulsion of

a foreign correspondent since 1998.

“The action taken against the WSJ

correspondents is an extreme and obvi-

ous attempt by the Chinese authorities

to intimidate foreign news organisa-

tions by taking retribution against their

China-based correspondents,” the club

said in a statement.

Janan Ganesh age 9p

Article backlash

China to expel Wall Street Journal reporters

Beijing claims opinion

piece smeared efforts

to fight virus outbreak

B R O O K E F OX A N D A N N A N I C O L AO U
NEW YORK

Michael Bloomberg as made up for hish
late entry into the Democratic presiden-
tial race with an advertising spending
spree of nearly half a billion dollars that
has caught more conventional cam-
paigns off-guard.
The self-made billionaire and former
mayor of New York City has surged to
19 per cent support in a national poll, up
from only 4 per cent in December. His
strong showing, supported by a flush
self-funded campaign,earned him a
spot n last night’s debate in Las Vegas,i
which put him head to head with the
other candidates for the first time.
“Advertising works,” said Brian Wie-
ser, president of business intelligence
for GroupM, the media buying agency
owned byWPP. “That’s the obvious,
single biggest takeaway.”
Mr Bloomberg’s spending dwarfs any
of his rivals with a serious shot at the
ticket, prompting other candidates to
accuse him of trying to buy the election.
“This is a stark difference from some-
one who can just come in and plop down
a cheque and buy a bunch of ads,” said
Amy Klobuchar, the Minnesota senator
also running for the Democratic nomi-
nation. “I think people are going to see
through it.”
Voters seem less bothered. Mr
Bloomberg, who is worth an estimated
$62bn, came in second place to Bernie
Sanders in an NPR/PBS NewsHour/
Marist poll of Democratic voters nation-
wide, released on Tuesday. That puts
him ahead of rivals Joe Biden, Elizabeth
Warren, Ms Klobuchar and Pete
Buttigieg.
During this year’s Super Bowl, the
most expensive airtime in the US, a
60-secondBloomberg campaign advert
that ran moments before the second-
half kick-off is believed to have cost an
estimated $10m.
The only other candidate to spend
that much money on a Super Bowl ad
was Donald Trump. The US president
spent $65m less for his entire 2016 pres-
idential campaign than the $408m Mr
Bloomberg has shelled out in his first
four months.
M r Bloomberg has flipped traditional

campaign spending on its head. Unfet-

tered by fundraising constraints, he has

bypassed the earliest-voting states to

cast his eye on big, populous states

where he can splash out in proportion to

the number of delegates on offer.

Mr Sanders and Mr Buttigieg devoted

more than $10m each to advertising in

Iowa, the first state to hold a primary —

where they finishedneck and neck

among Democratic candidates — but Mr

Bloomberg spent a measly $160.

Iowa and New Hampshire’s early

contests only offer a small number dele-

gates to support a candidate’s nomina-

tion at the party convention in July, but

campaigns usually focus on spending

there because early wins can help build

momentum.

The Bloomberg campaign has already

forked out $147m on the 14 states that

hold primaries on March 3, often called

Super Tuesday, when 1,357 delegates

are up for grabs.

The other candidates have spent a

combined $46m on Super Tuesday

states so far. His broadcast advertising

budget has focused on California — a sig-

nificant prize with its 415 delegates —

Texas, Florida and New York, according

to data compiled by Advertising

Analytics.

In California, Mr Bloomberg has spent

almost $50m so far, way more than any

candidate — although he has captured

only 4 per cent support in the state,

according to an average of polls from

Real Clear Politics.

New Jersey is a notable exception. It

ranks in the top 10 states for number of

delegates, yet Mr Bloomberg has only

devoted $73,000 to ads there.

It is possible he hopes to have already

secured the 1,990 delegates needed to

win the nomination prior to the state’s

primary, which falls on the last day of

the Democratic race.

The Bloomberg campaign’s extrava-

gance does not stop at advertising. Mil-

lions also went to fund private-jet travel,

pricey rent at the campaign’s Manhat-

tan headquarters in Times Square, high-

powered consultants and Apple laptops

for staff. In December, Mr Bloomberg’s

campaign paid nearly $14,000 to Cow-

girl Catering, a New York deli, and

$16,000 to JL Sushi restaurant. In

November and December it spent more

than $660,000 on Apple computers,

according to FEC filings.

In addition to television, the 78-year-

old is splashing cash on less traditional

forms of advertising such as Instagram

influencers.

Dozens of sponsored adverts for Mr

Bloomberg have recently appeared on

popular meme accounts such as @kale-

salad, @grapejuiceboys and @myther-

apistsays.

“Hello Juice Boys,” an Instagram mes-

sage from Mr Bloomberg begins. “Can

you post an original meme to make me

look cool for the upcoming Democratic

primary?” A screenshot of the exchange

was posted on the Instagram account

@grapejuiceboys, with a disclosure:

paid for by Mike Bloomberg.

Lex age 10p

White House race. emocratsD

Bloomberg unleashes advertising blitz

Lavish spending prompts

some rivals to claim he is

trying to buy the nomination

Meet and greet:

Michael

Bloomberg,

second right,

attends a

campaign event

in Houston,

Texas, last week

Go Nakamura/Reuters

L AU R A P I T E L— ISTANBUL

Turkey’s central bank has cut its

benchmark rate for a sixth time in a

row, despite growing currency volatil-

ity and geopolitical risks.

The bank’s Monetary Policy Committee

lowered its one-week repo rate by 50

basis points to 10.75 per centyesterday,

bringing the bank closer to achieving

president Recep Tayyip Erdogan’s long-

stated aim of having single-digit rates in

a bid to revive the country’s previous

credit-fuelled, fast-paced growth.

The move was smaller than previous

rate cuts but pushes real rates — the

interest rate minus the inflation rate —

deeper into negative territory, dimin-

ishing the premium earned by foreign

and local investors in return for holding

Turkish assets. When annual inflation

of 12.15 per cent in January is taken into

account, the real rate now stands at

minus 1.4 per cent.

The lira was 0.2 per cent lower against

the dollar afteryesterday’s decision,

which was in line with the expectations

of economists surveyed by Reuters.

Turkey’s central bank has been under

pressure from Mr Erdogan, a life-long

opponent of high interest rates and who

has asserted greater control over the

bank in recent years.

The Turkish president, who holds the

unorthodox economic view that high

interest rates cause nflation rather thani

curbing it, has said many times that he

wants interest rates and inflation to fall

to single digits this year.

Speaking hours beforeyesterday’s

decision, Mr Erdogan restated that posi-

tion, telling an audience of ruling party

members: “Our determination to bring

down inflation and interest continues.”

He added that he wanted to see a

“much higher growth rate” in 2020.

Last year the economy suffered a slump

in the aftermath of a painful currency

crisis.

Economists say that a fresh round of

credit-fuelled growth risks stoking infla-

tion, reviving its chronic current

account deficit and putting fresh pres-

sure on the lira — testing the limits of

the authorities’ efforts to control the

currency.

The lira has experienced a fresh bout

of volatility in recent weeks, caused

partly by a stronger dollar but also

fuelled by concerns that Turkey is being

dragged deeper into the conflict in the

Syria province of Idlib.

Responding toyesterday’s decision,

Goldman Sachs economists Clemens

Grafe and Murat Unur said that they

expected the central bank to comply

with Mr Erdogan’s wish for single-digit

rates.

But they anticipated he bankt would

cut in smaller increments of 25 basis

points at a time in the months ahead,

arguing there was now “much less room

for lowering rates” and that lira volatil-

ity remained “a key risk”.

They added: “We think that risks are

skewed towards larger rate cuts as in

our view the authorities continue to

prioritise growth.”

Turkey central bank

Erdogan’s goal

of single-digit

rates edges

closer with

sixth cut

‘Advertising

works.

That’s the

obvious,

single

biggest

takeaway’

‘We think risks are skewed

towards larger rate cuts as

the authorities continue

to prioritise growth’

K A D H I M S H U B B E R— WASHINGTON

When Donald Trump announced on
Tuesday he would commute the sen-
tence of Rod Blagojevich, the disgraced
former Illinois governor, he invoked
the names of former US justice depart-
ment officials he has long denounced.

“It was a prosecution by the same peo-
ple — Comey, Fitzpatrick [sic] — the
same group,” the president said, refer-
ring to James Comey, the FBI director he
fired, and Patrick Fitzgerald, Mr
Comey’s friend who prosecuted Mr
Blagojevich for corruption.
The comments gave a ersonal andp
political tinge to a sweep of clemency for
high-profile, white-collar criminals,
including Michael Milken, the former
junk bond trader, shortly before Mr
Trump’s longtime friend, Roger Stone,
is set to be sentenced in Washington.
The pardons are the latest instance of
Mr Trump granting leniency to famous
defendants. They were also a stark
reminder of the president’s broad
authority to undo federal convictions,
including, potentially, associates who

helped him win the White House.

“I think he’s written the cheque, and

he’s just waiting to put the date on it,”

said Patrick Cotter, a former New York

mob prosecutor.

Mr Trump issued the pardons after

setting off controversy over Mr Stone’s

case with repeated comments and

tweets that attacked the federal prose-

cutors assigned to Mr Stone’s case, a

juror from his trial and Judge Amy Ber-

man Jackson, who will sentence Mr

Stone today for lying to Congress and

witness tampering.

Mr Trump denounced the justice

department’s recommendation that Mr

Stone be sentenced to up to nine years in

prison as unnecessarily harsh. William

Barr, attorney-general, then reversed

that recommendation. The four prose-

cutors who secured Mr Stone’s convic-

tion quit the case in protest.

Mr Stone is just one of several associ-

ates of the president who either languish

in jail or are awaiting sentencing in cases

initially brought by Robert Mueller, the

special counsel who investigated claims

of Russian meddling in the 2016 election

that involve lying to the government

about the events surrounding the presi-

dential race.

Paul Manafort, Mr Trump’s former

campaign manager, is serving seven and

a half years in prison for tax and bank

fraud, false statements and witness

tampering. Michael Flynn, Mr Trump’s

former national security adviser, is still

awaiting sentencing after pleading

guilty to lying to the FBI in 2017. He has

sought to withdraw his plea.

The question of whether Mr Trump

would pardon associates featured in Mr

Mueller’s final report, which concluded

the president and his allies had used the

possibility of clemency to persuade wit-

nesses in the probe not to co-operate.

Mr Trump s far from the first presi-i

dent to attract controversy for his par-

doning decisions. “The history of presi-

dential pardons is hardly pristine or

inviolate,” said Jonathan Turley, a con-

stitutional law professor at George

Washington University, who was called

by Republicans to testify before the

House judiciary committee on Mr

Trump’s impeachment.

Bill Clinton, on his last day in office,

pardoned Marc Rich, the Glencore

founder who was a fugitive from charges

of racketeering, fraud and tax evasion.

Barack Obamapardoned Chelsea

Manning, convicted of leaking military

secrets, in his last week in office. George

HW Bush pardoned six former officials

convicted of crimes in the Iran-Contra

scandal shortly before leaving office.

Presidential leniency

Trump clemency moves raise prospect of further pardons

H E L E N WA R R E L L— LONDON

UN peacekeepers are to start using

mass online conversations to try to

understand what people living in war

zones want from peace agreements.

The new technology, which could be

used in countries such as Yemen,

Afghanistan and Ukraine, has been

developed by UN officials working with

Remesh, a New York start-up, and will

be rolled out within the next year.

People invited to take part in a mass

conversation can answer questions and

respond to polls on their smartphones

and their responses are analysed in real

time to try to present insights to the UN.

Fabrizio Hochschild, the UN under-

secretary-general responsible for digital

co-operation, said he wanted to broaden

negotiations beyond the interests of 10“

men — and usually always they are men

— sitting in a room with a UN mediator

in between”.

He said the aim was to have a new sys-

tem which “really reflects the aspira-

tions of those most affected by conflict”.

While more than $27bn is spent each

year on peacebuilding initiatives,based

on a UN estimate, as many as two-thirds

of these do not lead to any durable reso-

lution. Instead, conflicts are often

resumed two or three times after an

agreement is signed.

Several academic studies have shown

that wider consultation is key to ensur-

ing the success of any peace deal, but

gauging sentiment is difficult because

viewpoints and goals shift as conflicts

evolve.

Remesh said its platform was a “real-

time” dialogue, carried out with simul-

taneous translation.“You could think of

it as just a really, really fancy AI-pow-

ered conversation platform,” said

Andrew Konya, founder of Remesh.

The main challenge will be finding

people to engage with, and persuading

them. The UN said it would issue both

online and physical invitations.

Online chat

UN uses tech start-up to help

war victims design peace deal

Michael Milken: white-collar

criminal was a junk bond trader